#1THE INVESTOR'S GUIDE TO THE NEW ZEALAND BEVERAGES INDUSTRY 2017 Part of the New Zealand Food & Beverage Information Project FINAL REPORT; v1.02; June 2017 CORIOLIS MINISTRY OF BUSINESS, INNOVATION & EMPLOYMENT NEW ZEALAND TRADE & ENTERPRISE Ministry for Primary Industries Manatü Ahu Matua research consulting strategy HIKINA WHAKATUTUKI#2STEERING & GUIDANCE This project would not have been possible without the strong guidance of our Steering Committee. In particular, we would like to thank Andrew McCallum of MBIE for his tireless energy in keeping this project on track, while at the same time pushing us forward. Draft versions of parts of this document were distributed to key firms for comment, addition or correction. This was done in the form of emails and phone calls. We thank those who helped us in this process for their time and effort. We also thank those who provided their photos. We are grateful for all of the input we have received, but the report is ours and any errors are our own. Finally, we acknowledge the support of the Ministry of Business, Innovation and Employment (MBIE), New Zealand Trade and Enterprise (NZTE) and the Ministry of Primary Industries (MPI). It is their funding that has made this report possible. CONSTRAINTS & INHERENT LIMITATIONS This work was commissioned by the Ministry of Business, Innovation and Employment (MBIE) and prepared by Coriolis. This work is based on secondary market research, analysis of information available or provided to Coriolis by our client, and a range of interviews with industry participants and industry experts. Coriolis have not independently verified this information and make no representation or warranty, express or implied, that such information is accurate or complete. The report is dated June 2017 and Coriolis accepts no liability for, and has not undertaken work in respect of, any event subsequent to that date, which may affect the report. Key global trade data analysed in all sections of the F&B Information project are calculated and displayed in US$. This is done for a range of reasons: It is the currency most used in international trade. It allows for cross country comparisons (e.g. vs. Denmark) It removes the impact of NZD exchange rate variability It is more comprehensible to non-NZ audiences (e.g. foreign investors) It is the currency in which the United Nations collects and tabulates global trade data Anyone should feel free to call the authors if any of the material cannot be understood or accessed. We always welcome opportunities to discuss our research with our readers and users. Projected market information, analyses and conclusions contained herein are based (unless sourced otherwise) on the information described above and on Coriolis' judgment, and should not be construed as definitive forecasts or guarantees of future performance or results. Neither Coriolis nor its officers, directors, shareholders, employees or agents accept any responsibility or liability with respect to this document. Coriolis wishes to draw your attention to the following limitations of the Coriolis report "New Zealand Beverages Industry 2017" (the Coriolis Report) including any accompanying presentation, appendices and commentary (the Coriolis Commentary): a. Coriolis has not been asked to independently verify or audit the information or material provided to it by, or on behalf of the Client, or any of the parties involved in the project; b. the information contained in the Coriolis Report and any Coriolis Commentary has been compiled from information and material supplied by third party sources and publicly available information which may (in part) be inaccurate or incomplete; c. Coriolis makes no representation, warranty or guarantee, whether express or implied, as to the quality, accuracy, reliability, currency or completeness of the information provided in the Coriolis Report and any Coriolis Commentary, or that reasonable care has been taken in compiling or preparing them; d. the analysis contained in the Coriolis Report and any Coriolis Commentary are subject to the key assumptions, further qualifications and limitations included in the Coriolis Report and Coriolis Commentary, and are subject to significant uncertainties and contingencies, some of which, if not all, are outside the control of Coriolis; and e. any Coriolis Commentary accompanying the Coriolis Report is an integral part of interpreting the Coriolis Report. Consideration of the Coriolis Report will be incomplete if it is reviewed in the absence of the Coriolis Commentary and Coriolis conclusions may be misinterpreted if the Coriolis Report is reviewed in absence of the Coriolis Commentary. Coriolis is not responsible or liable in any way for any loss or damage incurred by any person or entity relying on the information in, and the Recipient unconditionally and irrevocably releases Coriolis from liability for loss or damage of any kind whatsoever arising from, the Coriolis Report or Coriolis Commentary including without limitation judgments, opinions, hypothesis, views, forecasts or any other outputs therein and any interpretation, opinion or conclusion that the Recipient may form as a result of examining the Coriolis Report or Coriolis Commentary. The Coriolis Report and any Coriolis Commentary may not be relied upon by the Recipient, and any use of, or reliance on that material is entirely at their own risk. Coriolis shall have no liability for any loss or damage arising out of any such use. Unless otherwise noted, all photos used in this discussion document were provided by the New Zealand Story resource (www.nzstory.govt.nz), purchased by Coriolis from a range of stock photography providers (as documented where required), or are low resolution, complete product/brand for illustrative purposes used under fair dealing/fair use for both "research and study" and "review and criticism". Our usage of them complies with New Zealand law or their various license agreements. Cover image: Shutterstock (XiXinXing) Where appropriate, this document is Copyright © 2017 Coriolis and MBIE. However, please feel welcome to use, refer to and cite this research. MINISTRY OF BUSINESS, INNOVATION & EMPLOYMENT HIKINA WHAKATUTUKI Ministry for Primary Industries Manatu Ahu Matua NEW ZEALAND TRADE & ENTERPRISE CORIOLIS research consulting strategy#3TABLE OF CONTENTS 01 02 03 04 INTRO Context & Conclusions Market Overview Production Categories Pages 3-10 Pages 11-24 Pages 25-39 Pages 40-49 Growth & Innovation Pages 50-64 05 Firms Performance Pages 65+ + Purpose + Global situation + Wine + Overview + Horizons for growth + Situation summary + Consumption + Beer + Category Segmentation + Emerging export stars + Drivers of success + Import demand + Juice + Exports by product + Investment + Export supply + Alcoholic Spirits + Mega-trends driving change opportunities + Key markets + + Water + SWOT Innovation & new products + Market growth + Production + Supply chain + Regional activity + Key inputs + Growth upside + Enterprises + Employment + Turnover + Ownership + Foreign investors + Acquisitions + Investment + Rebranding + Leadership + Firm Profiles#4PURPOSE Why did the New Zealand government undertake this project? What is the purpose of the project? The project presents a comprehensive, business-focused overview of the total New Zealand food and beverage industry. The project pulls together the available information on the food and beverage industry into one place, in a form which is familiar and useful to business. The reports contain analysis and interpretation of trends and opportunities to materially assist with business strategy and government policy. The information will be of vital use to businesses, investors, government, and research institutions as the industry expands and diversifies. This industry view will be very useful to government, enabling better dialogue and the opportunity to address issues collectively. What benefit will this bring to businesses? - - - - - - - - As support for raising capital As a base of market intelligence to enable business to be much more targeted in their own market research Reviewing and informing offshore market development (including export and investment) strategies Assisting in identifying areas of innovation and R&D for the future Identifying strategic partners and collaborators Enabling a company to benchmark performance with that of its competitors Monitoring industry activity Gaining a better understanding of their own industry sector Identifying internal capability needs or external inputs How will government use the reports? While the government collects large amounts of industry data, little of this has an investor or industry-driven perspective. This information will provide much greater insight into the industry, which is useful for a range of policy developments, from regulatory frameworks to investment in science and skills and facilitating access to international markets. In particular, a single source of factual information will enable government agencies to better coordinate their efforts across the system and be more responsive to addressing industry issues. All project resources are available online at: www.foodandbeverage.govt.nz CORIOLIS 4#5SITUATION SUMMARY: WINE The New Zealand wine industry has shown rapid growth driven by Marlborough Sauvignon Blanc; some diversification into new varieties and new regions is occurring NEW ZEALAND WINE The New Zealand wine industry has achieved spectacular growth over the last 40 years, going from NZ£51 in exports in 1960 to NZ$1.6b in 2016. Today New Zealand competes successfully with major wine producers, both old world (e.g. France, Germany) and new (e.g. Australia). New Zealand has achieved an overall premium price position in-market on par with France (which has been producing wine for ~2,000 years). International success to date has been built almost exclusively on Marlborough Sauvignon Blanc which has become a "must-have" wine for major wine players. However good Marlborough wine area is now almost all used. This may be a good thing as Marlborough now has almost as much area in grapes as Burgundy. Emergent secondary regions are 20 years behind Marlborough in terms of development. Hawkes Bay, Waipara and Central Otago stand out as the next best prospects. However, other than Hawkes Bay/Gimblett Gravels Syrah and Central Otago Pinot Noir most regions have yet to find "their" wine and the experience of Europe suggest this could take some time. Wine production is a fast growing industry for New Zealand, with a number of firms, ranging from very large to very small. Many large wineries are now foreign owned and on-going acquisitions are occurring. As a result foreign ownership now plays a big part in the wine industry, and these global firms with their global sales resources and reach, provide a path-to-market for introducing global consumers to New Zealand wines. That being said, there is a substantial group of successful medium sized New Zealand owned wineries that, in many ways, are the key force driving industry quality and innovation forward (e.g. light wine development). COMPETITORS New Zealand wine competes directly with that from other premium temperate climate countries, particularly France, Germany, cooler parts of the US (e.g. Oregon) and Chile. CONSUMERS/MARKETS Global oversupply has been ongoing, pushing down prices. These falling prices have impacted New Zealand wines. At the same time wine consumption is declining in many EU markets (France, Italy, Spain) for social, lifestyle and economic reasons. These twin forces, falling consumption and falling prices, have in turn triggered a decrease in global wine area and production, particularly in the three largest wine producers (France, Italy & Spain). On-going changes to EU subsidy systems have accelerated the process. New Zealand's success to date in wine has been primarily in the Anglo-Saxon four (USA, Canada, UK & AU). Luckily these markets have had stable-to- increasing consumption. However, it would be in the interest of New Zealand producers to develop new markets to reduce this concentrated reliance on these markets. China is a rapidly emerging growth market for global wine and is now the fourth largest wine importing country in the world by value. China is now New Zealand's sixth wine export destination and growing. Available in-market data suggests - at a high level - that the growth of New Zealand wine is at the expense of French wines (i.e. the two are close substitutes for consumers). Source: Coriolis; interviews CORIOLIS 5#6SITUATION SUMMARY: OTHER BEVERAGES Outside wine, the New Zealand beverage sector is primarily focused on production for domestic consumption; however, exports are growing strongly for many products SPIRITS Prior to 2000 there is a wide range of small spirit ventures, producing small scale niche spirits for the domestic market. At the same time Independent Liquor launched RTD 2 spirit beverages primarily for domestic consumption and export to Australia. Everything changed with the launch, rapid growth and financial success of 42 Below which created global awareness of New Zealand as a super-premium spirits provider. In the wake of 42 Below a large number of new firms have entered the industry with a wide range of products and brands. Independent Liquor, recently purchased by Asahi, is the largest player in spirits. Independent initially developed its business around flavoured RTD drinks, however it is diversifying into other alcoholic beverages. The two main brewers also produce and pack spirits, as well as distribute imported products and brands. There are a range of other smaller firms in spirits achieving strong growth and the sector is well positioned for further growth (see related project 2012 Spirits Opportunity report). BEER been Globally, mainstream beer brewing has dominated by large companies mainly leveraging scale, point-of-purchase control and distribution economics. New Zealand's three mainstream brewers focused on domestic consumption are: DB Breweries (Heineken), Lion (Kirin) and Independent (Asahi). This situation is changing rapidly with the emergence of a burgeoning craft brewing scene. New Zealand now has a range of smaller/micro breweries, rising with the growth of craft beer. Leaders in this space include Moa Brewing, McCashin's, Harrington's and many other smaller, innovative firms. New Zealand is a currently a minor beer exporter¹, and imports more beer than it exports. However, beer exports have surged in the last few years. The country is known for its specialty hops and both uses these domestically and exports them. SOFT-DRINKS/FLAVOURED BEVERAGES Non-alcoholic beverages are relatively consolidated across two international companies that primarily manufacture for domestic consumption: - Coca-Cola Amatil, Australian-listed Asia-Pacific licensee of Coca-Cola; Frucor, former Apple & Pear Marketing Board juice business, now a division of Suntory (Japan); maker of V energy drink and the Pepsi licensee in New Zealand. Smaller innovators emerging outside core soft-drinks. Organic-producer Phoenix (Charlie's/TBDC) owned by Asahi. A large range of premium adult beverages are gaining traction across multiple channels. JUICE New Zealand exports apple and kiwifruit juice, primarily as a secondary product of the fresh fruit industry. However New Zealand imports +20% more juice than it exports and domestic fruit production cost structures suggest a premium/niche strategy. WATER New Zealand has excellent theoretical potential to produce and export premium bottled water. A number of brands and companies have moved into this premium space (e.g. One, Antipodes and Palaeo). However, to date, little of this potential has been realised. 1. RTD = ready-to-drink; 2. Mexico, for example, exports 80x as much beer as New Zealand; NZ currently exports about as much beer as the Dominican Republic CORIOLIS 6#7DRIVERS OF SUCCESS New Zealand's success in beverages has three key drivers IDEAL CLIMATE & SOILS EFFICIENT PEOPLE & SYSTEMS LOCATION & MARKETS Low production cost Trusted by consumers High share in key products Temperate climate similar to Italy or France Temperature extremes moderated by surrounding ocean Isolated location protected by natural barriers - Innovative New World wine producer that burst onto the global wine scene in the 1980's Industry highly focused on export success Large pool of skilled people Strong systems and support networks Source: photo credit (NZStory and images under license from shutterstock.com) Well-organised, cohesive industry Excellent proximity to East & South-East Asian markets - CER agreement with Australia NZ was the first developed country to sign a free trade deal with China (2008) CORIOLIS 7#8INVESTMENT OPPORTUNITIES Beverages are a major opportunity for investors; wine has shown rapid growth; opportunities exist in second tier wine regions, cider, premium spirits and other beverages WINE New Zealand Sauvignon Blanc wine is now a "must- have" component of the portfolio for major global wine companies. Three of the top five US wine companies and three of the largest European alcoholic beverage companies are active in New Zealand. In addition, three of the top five Australian wine companies are in New Zealand. There are some opportunities for further investment in Marlborough. However, geographical constraints place limitations on further growth in Marlborough. Large wine firms are either foreign owned by global majors or committed NZ family owners (i.e. Delegat and Villa Maria both have committed owners). Opportunities exist for new investment in next tier down of firms (e.g. Giesen, Allan Scott, etc.). However these firms are looking for smart investment which gives them access to a global salesforce and a route to market. Investors with transferrable skills or those looking to unlock hidden value should investigate emergent secondary regions (i.e. "the next Marlborough"). SPIRITS New Zealand has clear potential in premium alcoholic beverages, building, in part, on New Zealand positioning in premium wine. Peer group countries (e.g. UK, Sweden) suggest strong future growth possible. However, there are limited entry vehicles. At this point in the life cycle, opportunities exist for start-ups into the space. Greenfields entry by global player with a strong transferrable skill set also suits. CIDER New Zealand is a major apple producer and exporter. Recently the cider industry in New Zealand has experienced strong growth, both for domestic consumption and export. Exports have shown strong growth over the past decade, primarily to Australia. While there are a large number of producers, most export volume is produced by the two main brewers (Heineken/DB & Kirin/Lion). BEER New Zealand produces hops and barley and has ~150+ years of beer brewing experience. After a long period of flat exports, beer exports have recently started growing. However to date limited demand for New Zealand beer has been developed in markets beyond Australia. Microbreweries are small and growing, but most currently have a domestic focus. However, Moa Breweries has listed on the NZX and is making an export push. Future export success by New Zealand beer will require a unique or more differentiated product (as was the case with wine). SOFT DRINKS In soft drinks, while both Frucor/V and TBDC/Charlie's/Phoenix are attractive, but both are now Japanese owned. A range of smaller firms exist. WATER There are potential opportunities in exporting bottled water. However, at this late point in the global life- cycle, meaningful success will require global best practice marketing (cf. Lynda Rae Resnick/Fiji Water). Best fit would be for investor with transferrable capability. CORIOLIS 8#9SWOT ANALYSIS The New Zealand beverage industry is well positioned for further growth, but pressures will continue STRENGTHS Islands in the middle of the South Pacific that have the area of Italy, but with only the population of Singapore; therefore relatively unspoilt Strong and growing success in premium/super-premium wine Achieves a strong price premium for wine in key markets (similar to France) New Zealand Sauvignon Blanc now a "must have" for global wine companies Growth in market share in key markets (e.g. USA) Innovative and quality-focused producers (e.g. Chia+Kawa) Closer shipping distances to Asia compared to European competitors Demonstrated capabilities in beverage production On-going growth and success of Frucor/V, and Charlies/Phoenix in non-alcoholic drinks category Emergent success in spirits (e.g. Stolen) OPPORTUNITIES Continued income growth in Asian markets - Rapidly growing demand for premium alcoholic beverages in Asia = - Low share in Europe (two thirds of global wine consumption) outside British Isles Joint in-market activity spreading cost of marketing Strong and growing demand in Asia for premium fortified wines/wine based spirits (e.g. cognac) - Reduction of global "wine ocean" supporting higher prices Leverage success of New Zealand wine industry; build on awareness of New Zealand in wider premium beverages segments Wide range of New Zealand unique plants available as flavouring (e.g. 42 Below Manuka honey) - - WEAKNESSES Large number of small producers with limited economies of scale High debt levels of many small and medium sized producers Highly dependant on four countries (AU, UK, USA and Canada) Increasing exports of bulk wine Lack strong super-premium heritage brands as demanded by brand and status conscious Asian consumers No deep cultural unique "spirits" associated with New Zealand Long shipping distance to traditional western markets Unlike traditional sectors, no major ($1b+) New Zealand owned champion growing and driving New Zealand brand position in beer, wine or other beverages Limited culture of super-premium branding or positioning (e.g. relative to France) Not a major producer of many base ingredients of typical beverages (e.g. oranges) ISSUES/THREATS/RISKS Ongoing consolidation of the industry Difficult finding good distributors to gain access into key markets Continued growth of bulk wine trade reducing the value of wine Continued growth of retail brands/store brands in wine Limited opportunity shipping "water" around the world if it isn't a premium product Changing consumer sentiment or government policy Failure to achieve large scale export traction outside wine Hollowing out of management skills in New Zealand industry due to foreign ownership (relative to Denmark or Holland for example) CORIOLIS 9#10SUPPLY CHAIN The New Zealand beverage industry has a relatively straight forward supply chain that delivers to consumers worldwide SIMPLIFIED MODEL OF NEW ZEALAND BEVERAGE SUPPLY CHAIN Model; 2017 Domestic Imported beverages Grocery wholesale Supermarkets & market other retail Apple/pear growing Soft drink manufacturing Other fruit growing (rem. A013) Cider manufacturing Liquor wholesale¹ Hops/other ingredients/ imports Beer manufacturing Distributor wholesaler Liquor specialists Spirit manufacturing Seafreight Airfreight Beverage/liquor wholesale¹ (in-market) Grape growing Wine making Hospitality/ Foodservice Supermarkets & other retail Hospitality/ Foodservice International markets 1. There may be one or more layers of wholesaling, depending on product or market; some wholesale functions may be captive inside retailers or foodservice operators; Source: Coriolis CORIOLIS 10#11Global Market Overview + Consumption + Global trade + Import demand + Export supply + Key markets + Market growth 01#12New Zealand has a strong position in the growing global beverages trade PRODUCTION Beverages are a huge global market spread across a wide range of products In terms of final litres consumed, the key products are tap water, tea, packaged water, beer and carbonated soft drinks GLOBAL TRADE Global cross-border beverage trade volumes are growing (5.6% CAGR) with moderate price gains across the cycle leading to export value growth DEMAND: PRODUCT CATEGORIES - - Total global cross-border beverage trade is spread across a wide range of products, though bottled wine ($22.7b), beer ($12.7b), Whiskeys ($10.9b) and wider soft drinks ($17.5) stand out for size "Other flavoured beverages," gin, "other alcoholic spirits," soft drinks, beer and mineral water stand out for global growth over the past five years Imports vary in their average beverage price paid per litre, with sparking wine, spirits and bottled wine standing out for achieving high average prices DEMAND: IMPORT MARKETS - - Total global cross-border demand for beverages was US$116b in 2015; Europe (including inter-EU) is the single largest market, followed by E/SE Asia ($20.5b) and the US ($20.3b) China, various other E/SE Asian countries and the USA stand out for beverage import market growth Markets vary in average beverage import price, with Japan, China, much of E/SE Asia and the USA standing out as high value markets SUPPLY: EXPORTERS - - - On the supply side, Europe (including inter-EU) dominates the global beverage trade followed by the US; overall New Zealand is a strong second-tier supplier New Zealand in "on a roll" in beverages and has gained global export share in the past decade; the country appears to be closing in on Ireland and Australia New Zealand achieved a solid growth performance in beverage exports over the past five years, beating Europe and Australia in rate of growth The average export price received for beverages varies among countries, with New Zealand outperforming almost all competitors, including France CORIOLIS 12#13Beverages are a huge global market spread across a wide range of products; however, in terms of final litres consumed, the key products are tap water, tea, packaged water, beer and carbonated soft drinks TOTAL HUMAN FLUID CONSUMPTION Litres; t; 2016 GLOBAL PURCHASED BEVERAGE CONSUMPTION BY FINAL VOLUME Litres; b; 2016 Purchased Tap water 60% 40% Packaged water 19% See dairy report Drinking milk 10% Hot drinks -28% Coffee 6% TOTAL 4.4 trillion litres See processed foods report Carbonated soft drinks 14% Fruit & veg juices 4% Tea 22% Other 10% Packaged Non-Alcoholic Ready-to-Drink (NARTD) ~47% Beer 12% Alcoholic Beverages (On & Off Trade) -15% Wine 2% Spirits 1% Cider RTDs 0% 0% TOTAL 1,800 billion litres Note: Both tea and coffee will use tap water; drinking milk includes dairy-based drinks; tea includes mate and herbal blends Source: UN FAO Aquastat database; UN "Water for People, Water for Life"; OIV; Can Markets; Drinks Business; Kirin Beer University Report; Euromonitor; Statista; Coriolis estimates & analysis CORIOLIS 13#14Global cross-border beverage trade volumes are growing (5.6% CAGR) with moderate price gains across the cycle leading to export value growth GLOBAL EXPORT VOLUME L; b; 2005-2015 AVERAGE GLOBAL EXPORT PRICE US$/1; actual; 2005-2015 GLOBAL EXPORT VALUE US$; b; 2005-2015 10y CAGR 5.6% $120 90.0 $1.80 $140 10y CAGR 4.2% 10y CAGR 80.0 1.3% $1.60 70.0 60.0 $1.40 $1.20 $1.00 $0.60 40.0 $0.80 50.0 30.0 20.0 10.0 . 2011 2010 2009 2008 2015 2014 2013 2012 $0.40 $0.20 $0.00 2005 $100 II $80 $60 2015 2014 2013 2012 2011 2010 2009 2008 2007 2006 Note: data excludes "other [bulk] water" is as reported sender FOB; Source: UN FAO database; Coriolis classification and analysis 2005 2006 2007 $40 $20 $0 2012 2011 2010 2009 2008 2007 2006 2005 CORIOLIS 14#15Total global cross-border beverage trade is spread across a wide range of products, though bottled wine ($22.7b), beer ($12.7b), Whiskeys ($10.9b) and wider soft drinks ($17.5) stand out for size TOTAL GLOBAL BEVERAGE IMPORT VALUE BY PRODUCT OR PRODUCT CATEGORY US$; b; FOB; 2015 $14.1 $31.8 $35.2 Beer $12.7 Wine, bottle $22.7 Wine, bulk $3.2 Sparkling wine $5.8 Cider; other fermented $1.4 Grape must $0.1 Beer Wine Brandy/Cognac $6.1 Whiskeys $10.9 Gin -$0.9 Liqueurs $2.9 Vodka $2.2 Rum $1.0 Other alc. Spirits $4.3 Ethyl Alcohol $7.0 Spirits Note: 2015 is latest available globally; data is as reported sender FOB; Source: UN Comtrade database; Coriolis analysis $14.7 Apple juice $1.7 Apple juice, unsweetened $0.4 Orange juice not-frozen sweetened $1.7 Orange juice not-frozen unsweetened $1.9 Frozen orange juice $1.7 $17.5 Soft drinks $7.2 Total = $116.2 방 Other flavoured beverages $10.3 Other juices $7.4 Juices Soft Drinks Mineral water $2.4 Water Vinegar CORIOLIS 15#16"Other flavoured beverages," gin, "other alcoholic spirits," soft drinks, beer and mineral water stand out for global import growth over the past five years 5Y IMPORT GROWTH MATRIX: 5Y VOLUME VS. 5Y CAGR VALUE VS. VALUE 2015 BY PRODUCT L; b; % of US$; US$b; FOB; 2010 vs. 2015 5Y CAGR value US$; 10- 15 10%- 5%- Brandy/Cognac Sparkling wine Vinegar Other juices Frozen orange juice Gin Other alc. Spirits Cider; other fermented Whiskeys Apple juice, unsweetened Wine, bulk Wine, bottle Orange juice not-frozen unsweetened Grape must Rum Liqueurs 0% - Apple juice Vodka -4%7 -1.00 -0.50 Orange juice not-frozen sweetened 0.00 I 0.50 I 1.00 Other flavoured beverages Ethyl Alcohol Mineral water Soft drinks Beer 1.50 I 2.00 5Y Change in volume (l; b) of beverages imported; 10-15 Note: 2015 is latest available globally; data is as reported sender FOB; Source: UN Comtrade database; Coriolis analysis Bubble size is proportional to beverage import value in 2015; a bubble this size is US$3b $3 I 2.50 3.00 3.50 4.00 CORIOLIS 16#17Imports vary in their average beverage price paid per litre, with sparking wine, spirits and bottled wine standing out for achieving high average prices TOTAL GLOBAL BEVERAGE IMPORT VOLUME VS. AVERAGE PRICE BY PRODUCT/PRODUCT CATEGORY L; m; US$/l; actual; 2015 $14.63 Average import value per kilogram US$/1 2015 $6.84 $7.30 $6.5$5.59 $3.78 $1.24 $1,46 $1.62 $2.11 $3.58 $1.24 224 $1.13 $1.18 $1.180 Other juices $1.00 $$0.85 $0.77 $0.71 Weighted average $1.96 $0.31 Mineral water $0.54 Apple juice, unsw. $0.61 Orange juice not-froz unsw. Ethyl Alcohol Other flavoured bev. Beer Wine, bulk Soft drinks $0.99 Apple juice Cider; other ferm Vinegar Proportional to import volume in 2015 Note: therefore area under chart is proportional to import value (volume x $/1); Source: UN Comtrade data; Coriolis analysis and classifications Wine, bottle Sparkling wine Brandy/Cognac Whiskeys Liqueurs Grape must Frozen orange juice Orange juice not-frozen sw Other alc. spirits Vodka CORIOLIS 17#18Total global cross-border demand for beverages was US$116b in 2015; Europe (including inter-EU) is the single largest market, followed by E/SE Asia ($20.5b) and the USA ($20.3b) GLOBAL BEVERAGE IMPORT VALUE BY RECEIVING COUNTRY/REGION US$; b; FOB; 2015 $2.5 $1.9 Australia $0.3 ZN $31.0 Other Pacific $0.3 USA $20.3 Canada $5.3 Mexico $1.1 Brazil Panama $0.5 $0.8 Other Americas $2.9 Americas $53.0 United Kingdom $8.7 Germany $8.0 Netherlands $5.8 France $4.9 Belgium $3.9 Other Europe $19.5 Belarus Russia $0.2 $1.5 Turkey. $0.5 Europe Note: 2015 is latest available globally; data is as reported sender FOB; Source: UN Comtrade database; Coriolis analysis Australasia $3.2 $4.4 $1.6 $20.5 Total = $116.2 $0.5 $1.1 United Arab Emirates SS Africa $3.2 Singapore $2.2 Vietnam $1.8 Malaysia $0.7 Thailand $0.6 Other SE Asia $2.0 Other S Asia $11 Other NA/ME/CA $3.3 SS Africa NA/ME/CA Japan $3.2 South Korea $1.4 Hong Kong SAR $2.6 S Asia China $4.4 Other E Asia $1.6 E/SE Asia CORIOLIS 18#19China, various other E/SE Asian countries and the United States stand out for beverage import market growth 5Y IMPORT GROWTH MATRIX: 5Y VOLUME VS. 5Y CAGR VALUE VS. VALUE 2015 BY RECEIVING COUNTRY/REGION L; b; % of US$; US$b; FOB; 2010 vs. 2015 18%- Other S Asia 5Y CAGR import value US$; 10- 15 15%- Other Pacific Belarus 10%- Turkey Hong Kong SAR Vietnam Panama United Arab Emirates Brazil Other E Asia Malaysia Singapore South Korea Mexico Australia 5%- Thailand SS Africa 0% -5% Russia -0.5 Japan Other Americas Canada India 0.0 Netherlands UK Germany France I 0.5 Other NA/ME/CA Belgium China Other SE Asia USA Other Europe Bubble size is proportional to beverage import value in 2015; a bubble this size is US$3b $3 I 1.0 1.5 2.0 5Y Change in import volume (l;b) of beverages imported; 10-15 Note: 2015 is latest available globally; data is as reported sender FOB; Source: UN Comtrade database; Coriolis analysis I 2.5 I 3.0 CORIOLIS 19#20Markets vary in average beverage import price paid, with Japan, China, much of E/SE Asia and the USA standing out as high value markets GLOBAL BEVERAGE IMPORT VOLUME VS. AVERAGE IMPORT PRICE BY KEY MARKET L; b; US$/l; actual; 2015 Average import value per kilogram US$/1; 2015 Weighted average $1.42 $1.08 $1.16 $4.40 $1.16 $4.03 $1.17 $3.59 $2.83 $1.18 $1.17 $2.63 22.25252 $2.12 $2.07 Japan $1.98 Other S Asia $1.94 $1.87 $1.84 $1.68 $1.65 $1.50 UK $1.50 Russia $1.22 Panama $1.19 Other Europe South Koreal SS Africa Netherlands Other Americas UAE Canada Brazil Mexico USA Proportional to import volume in 2015 Note: therefore area under chart is proportional to import value (volume x $/1); Source: UN Comtrade data; Coriolis analysis and classifications $1.10 India France Germany $1.05 $0.99 Other Pacific Belgium $0.87 Other SE Asia $0.81 $0.58 Belarus Other NA/ME/CA Australia Thailand Other E Asia Singapore Malaysia Turkey Vietnam Hong Kong SAR China CORIOLIS 20#21On the supply side, Europe (including inter-EU) dominates the global beverage trade followed by the United States; overall New Zealand is a strong second-tier supplier TOTAL GLOBAL BEVERAGE EXPORT VALUE BY SENDING COUNTRY/REGION US$; b; FOB; 2015 $3.3 $22.2 $74.2 New Zealand $1.3 Australia $1.9 Other Pacific $0.1 Australasia USA $8.6 Canada $0.9 France $16.5 United Kingdom $10.0 Italy $8.9 Brazil $3.1 Germany $6.6 $0.8 $2.0 $1.8 Total = $116.2 $12.1 Singapore $2.8 Thailand $2.0 China $2.1 Mexico $4.7 Netherlands $6.6 Hong Kong SAR $1.3 Chile $2.1 Guatemala $0.3 Argentina $1.3 Other Americas $1.3 Americas Other Europe $24.6 Belarus Turkey Russia 10$ $0.5 $0.5 Europe Note: 2015 is latest available globally; data is as reported sender FOB; Source: UN Comtrade database; Coriolis analysis Other E Asia $3.8 CORIOLIS 21#22New Zealand is "on a roll" in beverages and has gained global export share in the past decade; the country appears to be closing in on Ireland and Australia BEVERAGE EXPORT MARKET SHARE: NEW ZEALAND VS. SELECT PEERS % of total global trade value; US$; 2005-2015 20% 3.4% 2.9% 2.9% 2.2% 2.0% 2.2% 2.2% 2.2% 2.0% 10Y Change 1.9% 1.8% 1.8% 1.8% 1.8% 1.8% .1.7% 1.7% Chile 1.7% 1.6% 1.6% 1.6% Australia 0.3% -1.8% 1.6% 1.5% 1.5% 1.6% 1.6% 1.5% 1.5% 1.5% 70% 1.3% 1.3% 1.2% 1.3% 1.2% 1.2% Ireland -0.7% 1.1% 1.1% 1.1% New Zealand 0.4% 1.0% 1.0% 1.0% 0.9% 1.8% 1.0% 0.9% 0.9% 0.9% 0.9% 0.8% 0.8% 0.8% 0.8% Canada -0.6% 0.7% 0.7% 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 CORIOLIS 22 Note: 2015 is latest available globally; data is as reported sender FOB; Source: UN Comtrade database; Coriolis analysis#23New Zealand achieved a solid growth performance in beverage exports over the past five years, beating both Europe and Australia in rate of growth 5Y EXPORT GROWTH MATRIX: 5Y VOLUME VS. 5Y CAGR VALUE VS. VALUE 2015 BY EXPORTING COUNTRY/REGION L; b; % of US$; US$b; FOB; 2010 vs. 2015 5Y CAGR export value US$; 10-15 16% - 14% - India Hong Kong SAR 12% - 10%- Other E Asia Other S Asia Singapore Russia 8%- Guatemala 6%- 4% - 2% - China 0% Canada New Zealand Netherlands Chile Turkey Mexico USA Italy United Kingdom Argentina France NA/ME/CA Brazil Germany -2%- Australia Other Americas SS Africa -0.5 0.0 I 0.5 I 1.0 Thailand Other Europe Bubble size is proportional to beverage export value in 2015; a bubble this size is US$3b $3 I 1.5 I 2.0 I I I 2.5 3.0 3.5 5Y Change in export volume (l; b) of beverages imported; 10-15 Note: 2015 is latest available globally; data is as reported sender FOB; Source: UN Comtrade database; Coriolis analysis CORIOLIS I 4.0 23#24The average export price received for beverages varies among countries, with New Zealand outperforming almost all competitors, including France TOTAL GLOBAL BEVERAGE EXPORT VOLUME VS. AVERAGE EXPORT PRICE BY KEY MARKET L; m; US$/l; actual; 2015 High value re-export $6.07 Average export value per kilogram US$/1 2015 Spirits Whisky & $2.51, $2.85 $3.55 $2.24 $2.03 $2.06 $1.74 999999 $1.55 $1.57 $1.60 $1.54 w $1.24 Mexico $1.33 Canada $1.35 USA India China Australia Netherlands Weighted average $1.96 $0.43 Russia $0.46 Thailand $0.47 $0.53 Other Pacific $0.65 $0.71 Batemala NA/ME/CA $0.81 Brazil $0.82 Turkey $0.96 Other S Asia $0.97 Other Americas $1,08 SS Africa $1.11 Germany Other Europe Proportional to export volume in 2015 Note: therefore area under chart is proportional to import value (volume x $/1); Source: UN Comtrade data; Coriolis analysis and classifications Italy Chile Argentina France Other E Asia New Zealand Singapore Hong Kong SAR United Kingdom CORIOLIS 24#25New Zealand Production + Wine + Beer + Juice + Alcoholic Spirits + Water + Production + Regional activity + Key inputs + Growth upside 02#26New Zealand can continue to to grow beverage production for the foreseeable future WINE PRODUCTION New Zealand is a rapidly emerging New World wine region with significant capacity for future growth and no major production challenges - - - - - - - Wine is New Zealand's largest beverage export - New Zealand grape area and wine production has grown dramatically over the past twenty years in response to growing global demand for New Zealand wine Absolute area growth is coming from Sauvignon Blanc; of other varietals, Pinot Gris and Pinot Noir are achieving traction - New Zealand has wineries spread across the country; however, about two-thirds of grape area is in Marlborough As the largest, most mature region, Marlborough leads in terms of both (1) tonnes per winery and (2) tonnes per hectare While Marlborough is clearly the leading region, a number of the smaller regions are growing, particularly recognised red producers Hawke's Bay (Syrah), Canterbury/Waipara (Pinot Noir), and Central Otago (Pinot Noir) Peer group performance suggests New Zealand has significant potential capacity to increase wine area over the mid-to-long run OTHER BEVERAGE PRODUCTION New Zealand can and does produce a range of other beverages beyond wine, again with few limitations on potential production volumes - - - - New Zealand produces significant volumes of both key beer ingredients (hops and barley); beer production trending down in recent years reflecting the market movement to "less but better quality" New Zealand is a major global producer and exporter of apples and kiwifruit, as well as developing and pioneering a wide range of new varieties and species New Zealand has significant quantities of raw materials available to produce alcoholic spirits New Zealand has an abundant supply of quality natural water and thousands of springs; natural springs are located primarily in two zones (Taupo Volcanic Zone and the Southern Alps Zone) Due to its unique history, New Zealand has a range of unique or signature ingredients and flavours suitable for use in beverages CORIOLIS 26#27New Zealand is a rapidly emerging New World wine region with significant capacity for future growth with no major impediments or capacity constraints WINE OTHER BEVERAGES CORIOLIS 27#28NEW ZEALAND WINE PRODUCTION L; m; 1977-2016 350,000 WINE PRODUCTION New Zealand grape area and wine production has grown dramatically over the past twenty years in response to growing global demand for New Zealand wine NEW ZEALAND GRAPE AREA Hectares; 1977-2016 40,000 35,000 30,000 25,000 20,000 15,000 10,000 5,000 300,000 250,000 2015 2013 2011 2009 2007 2005 2003 2001 1999 1997 1995 1993 1991 1989 1987 1985 1983 1981 1979 1977 1975 1973 1971 1969 1503 1967 NEW ZEALAND GRAPE PRODUCTION Tonnes crushed; 1977-2016 1965 1963 1961 500,000 450,000 400,000 350,000 300,000 250,000 200,000 150,000 100,000 50,000 0 200,000 150,000 100,000 Low year 50,000 2015 2013 2011 2009 2007 2005 2003 2001 1999 1997 1005 1995 1993 1001 1991 1080 1989 1987 1987 1985 1985 1983 1983 1981 1981 1970 1979 1077 וולו Source: MAF/MPI; NZWine Annual Report; UN FAO FAOSTAT database; Coriolis analysis 1975 כולו 1973 1975 1971 1371 1969 1969 1967 1965 1963 1961 0 CORIOLIS 28 2015 2013 2011 2009 2007 2007 2005 2005 2003 2009 2001 2001 1999 1999 1997 1995 1993 1991 1989 1987 1367 1965 1985 1983 1981 1979 1977 1975 1973 1971 1969 1967 1965 1963 1961#29Absolute area growth is coming from Sauvignon Blanc; of other varietals, Pinot Gris and Pinot Noir are achieving traction WINE AREA BY VARIETY Ha; 2006/2016 Excludes unknown 4,063 21,780 623 1,420 773 762 853 531 8,860 3,779 116- 2006 GROWTH MATRIX: WINE AREA BY VARIETY Ha; 2006/2016 10y ABS 10y CAGR 36,192 833 Other red Tonnes 210 1,271 Merlot -149 2.9% -1.1% per ha 5,573 Pinot Noir 0.15- 1,510 3.2% 0.10- Cabernet Sauvignon -248 -6.1% 283 781 Other White 8 0.1% 2,455 Pinot Gris 1,693 12.4% 1 767 Riesling -86 -1.1% 21,016 Sauvignon Blanc 12,156 9.0% 1 Pinot Gris 0.05- Other red Pinot Noir Sauvignon Blanc 0.007 -2,000 Other White 2,000 I 4,000 | 6,000 I 8,000 10,000 I 12,000 I 14,000 Merlot Riesling Chardonnay -0.05- Cabernet Sauvignon Bubble size is proportional to total grape production; a bubble this size is 10,000t 5,000 Muller Thurgau 3,211 Chardonnay -568 -1.6% -0.10- Muller Thurgau 2 -114 -32.7% 2016 Source: NZWine Annual Report (various years); Coriolis analysis Tonnes per winery CORIOLIS 29#30New Zealand has wineries spread across the country; however, about two-thirds of grape area is in Marlborough NUMBER OF WINERIES BY REGION OF NEW ZEALAND Units; 2016 HECTARES OF GRAPES BY REGION OF NEW ZEALAND Hectares; 2016 Gisborne 18 3% Other 5 1% Auck/North 134 20% Central Otago 133 20% Hawke's Bay 76 11% Wairarapa 68 10% Nelson 36 5% Cant/Wai 64 9% Marlborough, 141, 21% TOTAL = 675 wineries Source: NZWine Annual Report 2016; NZW Vineyard Register Report 2015-2018; Coriolis analysis Wairarapa 1,002 3% Gisborne 1,448 4% Auck/North 430 1% Cant/Wai 1,436 4% Central Otago 1,943 6% Hawke's Bay 4,744 13% Nelson 1,169 3% Marlborough, 24,020,66% TOTAL = 36,192 hectares CORIOLIS 30#31NZ: REGIONAL AREA VS. TONNES PER HECTARE Hectares; tonnes/hectare; 2016 13.5 As the largest, most mature region, Marlborough leads in terms of both (1) tonnes per winery and (2) tonnes per hectare NZ: NUMBER OF WINERIES VS. TONNES PER WINERY Units; t/unit; 2016 2,293 Tonnes /winery 886 565 279 Tonnes /hectare 190 74 69 Nelson Hawkes Bay Gisborne Wairarapa Canterbury Otago # of wineries 12 62 11.0 Northland Waikato Auckland Source: NZWine Annual Report 2016; NZW Vineyard Register Report 2015-2018; Coriolis analysis Marlborough 9.1 00 8.5 Marlborough 5.0 3.6! 9 47 1.4 1.1 Waikato Northland Auckland Nelson Canterbury Otago Wairarapa Hawkes Bay Gisborne Area in grapes CORIOLIS 31#32While Marlborough is clearly the leading region, a number of the smaller regions are growing, particularly those recognised red producers Hawke's Bay (Syrah), Canterbury/Waipara (Pinot Noir), and Central Otago (Pinot Noir) GRAPES CRUSHED IN VINTAGE BY REGION T; 2006/2011/2016 PRODUCTION MATRIX: T/WINERY VS. T/HA VS. TOTAL T; 2015/16 182,886 1,814 18,049 10y ABS 10y CAGR 420,356 1,377 15,944 Auck/North Gisborne -437 -2,105 -2.7% -1.2% Tonnes per ha 42,958 Hawke's Bay I 9,671 2.6% 5,049) 10,028 Wairarapa Nelson 2,041 5.3% 4,405 6.0% 324,592 1,626 14,450 35,533 3,598 7,854 33,287 244,893 3,008 3,025 113,436 15 10 Nelson Hawkes Bay Canterbury Auck/North 323,290 Marlborough | 209,854 11.0% Wairarapa Otago Gisborne Marlborough Bubble size is proportional to total grape production; a bubble this size is 10,000t 10,000 9,119 14.8% 9,485 3,051- 4,612 7,104 12,170 9,177 Cant/Waipara Central Otago Other 0 ==== -49- 363 4,565 357 7.1% 0 500 1,000 1,500 2,000 2,500 50.7% 2006 2011 2016 Tonnes per winery Source: NZW Annual Reports various years; NZW Vineyard Register Report various years; Coriolis analysis CORIOLIS 32#33Peer group performance suggests New Zealand has significant potential capacity to increase wine area over the mid-to-long run GROWTH MATRIX OF WINE AREA: % TOTAL AREA VS. M²/PERSON VS. TOTAL WINE AREA % of hectares; hectares/person; hectares; 2015 or 2016 Wine area /person m² 2015 250 200 150 100 50 0.0% New Zealand Greece Romania Bulgaria Hungary Austria Germany 0.5% Source: OIV; NZ Winegrowers; CIA World Fact Book; Coriolis analysis France 1.0% 1.5% Spain Portugal Italy Bubble size is proportional to total wine area A bubble this size is 100,000 hectares 2.0% 100,000 Wine area as a percent of total land area; % of km²; 2015 1 2.5% CORIOLIS 33#34New Zealand can and does produce a wide range of other beverages beyond wine with few limitations on potential production volumes WINE OTHER BEVERAGES CORIOLIS 34#35Ongoing shift to "less but better quality" BEER PRODUCTION New Zealand produces significant volumes of both key beer ingredients (hops and barley); beer production trending down in recent years reflecting the market movement to "less but better quality" NEW ZEALAND HOP PRODUCTION Tonnes; 1977-2014 NEW ZEALAND BEER PRODUCTION Tonnes; 1961-2014 450,000 1,000 900 800 700 600 500 400 300 200 100 1987 1985 1983 1981 1979 1977 1989 1995 1993 1991 2013 2011 2009 2007 2005 2003 2001 1999 1997 NEW ZEALAND BARLEY PRODUCTION Tonnes; 1961-2015 700,000 600,000 500,000 400,000 300,000 200,000 100,000 0 400,000 350,000 300,000 250,000 200,000 www 1989 1989 1987 1985 COOL 1983 1981 1979 1977 1975 1973 1971 1969 1965 1967 1963 1961 150,000 2013 2011 2009 2007 2005 2003 2001 2001 1999 לללו 1997 1337 1995 1555 1993 1991 וללן Source: MAF/MPI; UN FAO FAOSTAT database; Coriolis analysis 100,000 50,000 2013 CORIOLIS 35 2011 2009 2007 2005 2003 2001 1999 1997 1995 1993 1991 1989 1987 1985 1983 1981 1979 1977 1975 1973 1971 1969 1967 1965 1963 1961 0#36FRUIT FOR JUICE & CIDER New Zealand is a major global producer and exporter of apples and kiwifruit, as well as developing and pioneering a range of new varieties and species NEW ZEALAND FRUIT PRODUCTION Tonnes; 1961-2014 1,400,000 1,200,000 1,000,000 800,000 600,000 400,000 200,000 1963 1961 2003 2001 1999 1997 1995 1993 1991 1989 1987 1985 1983 1981 1979 1977 1975 1973 EXAMPLES OF FRUIT DEVELOPED OR PIONEERED IN NZ Select examples; 2017 APPLES KIWIFRUIT OTHER FRUIT Granny Smith* Wine grapes Other fruit Splendour Gala Royal Gala Braeburn Jazz Hayward (dominant global) Feijoa Tamarillo Bruno Alison EnzaGreen EnzaGold Passionfruit Envy Pacific Rose Pacific Beauty Zespri Gold Zespri Sungold Zespri SweetGreen Kiwifruit Pacific Queen KiwiKiss Smitten Maxie Kiwiberries Kiwano Blueberries (various cultivars) Blackcurrants (various cultivars) Apples Sweetie * Appeared in Australia but was developed/improved in New Zealand; Source: MAF/MPI; UN FAO FAOSTAT database; Coriolis analysis CORIOLIS 36#37ALCOHOLIC SPIRITS INPUTS New Zealand has significant quantities of raw materials available to produce alcoholic spirits NEW ZEALAND WHEY PRODUCTION Tonnes; 1977-2014 25,000 20,000 15,000 10,000 5,000 1961 1973 1971 1969 1967 1965 1963 1981 1979 1977 1975 w NEW ZEALAND GRAIN PRODUCTION Tonnes; 1961-2016 1,200,000 1,000,000 Total whey, including whey processed into alcohol 1999 1997 1995 1993 1991 1989 1987 1985 1983 2013 2001 2001 2003 2005 2007 2009 2011 NEW ZEALAND SUGAR REFINING PRODUCTION & IMPORTS Tonnes; 1961-2014 300,000 250,000 200,000 150,000 100,000 50,000 0 1987 1985 1983 1981 1975 1977 1979 1973 1971 1969 1967 Source: MAF/MPI; Statistics NZ; UN FAO FAOSTAT database; Coriolis analysis 800,000 Imported Other grains Barley 600,000 Corn 400,000 200,000 NZ Refined 0 Wheat 2015 2012 2009 2006 2003 2000 1997 1994 1991 1988 1985 1982 1979 1976 1973 1970 1967 1964 1961 CORIOLIS 37#38WATER New Zealand has an abundant supply of quality natural water and thousands of springs; natural springs are located primarily in two zones (Taupo Volcanic Zone and the Southern Alps Zone) AVAILABLE WATER: NEW ZEALAND VS. SELECT PEERS L; m or km³ as given; 2015 Water per person L; m; 2015 80 10 70 60 50- 40- 30- 20 10 333.5 cubic kilometres of renewable water/year New Zealand Fiji LOCATIONS OF SPRINGS IN NEW ZEALAND Presence; known sites; 2017 SOUTHERN ALPS ZONE TAUPO VOLCANIC ZONE Au Ha tong Palmerston North Wellington son Lealand Christchurch Bubble size is proportional Queenstown to renewable water; a bubble this size is 100 km³ 100 France Italy Dunedin T T Invercargill 0 200 400 600 800 1,000 1,200 1,400 1,600 Source: CIA World Fact Book; nzhotpools.co.nz; Coriolis analysis Water per square kilometre L; m; 2015 CORIOLIS 38#39UNIQUE FLAVOURS Due to its unique history, New Zealand has a range of unique or signature ingredients and flavours suitable for use in beverages Manuka Honey Kawakawa (Unique native plant) BELOW MANUKA HONEY IMPORTED HINOS GIN Feijoa PHOENIX Organic SPARKLING FEIJOA kiwi Crush Kiwifruit CLASSIC Gold Kiwifruit Titoki 8TH CORIOLIS 39#40New Zealand Category Performance + + Overview Category Segmentation + Exports by product 03#41New Zealand has a strong position in wine and is emerging across a wide range of other beverages OVERVIEW BY CATEGORY New Zealand has a strong beverages platform and produces all six major categories of beverages; New Zealand has real strength in wine and is growing and emerging in other categories Wine currently accounts for 83% of New Zealand beverage exports, followed by soft drinks (7%) and a range of other minor beverages Average export price varies by category, with wine standing out for high prices; wine is maintaining, but not growing pricing, across greater volumes; most other products shifting to quality New Zealand is growing its share of the global wine trade, but only maintaining share across most other beverages; cider appears to have stalled after solid growth (needs to transition beyond Australia) - - New Zealand has rapidly growing wine exports on the back of Marlborough Sauvignon Blanc, which is now a "must have" varietal across most major markets; Pinot Noir also achieving growing recognition New Zealand has had growing volumes of beer and cider exports, driven by increased interest in authentic, craft & premium; cider, in particular, appears well positioned for growth beyond Australia New Zealand has a fast evolving alcoholic spirits industry that is seeking its "signature" spirit in a large and growing global market New Zealand non-alcoholic beverages growing well, driven by juices and other flavoured beverages; Australia still the largest market, but E/SE Asia emerging (particularly Japan and China) CORIOLIS 41#42New Zealand has a strong beverages platform and produces all six major categories of beverages; New Zealand has real strength in wine and is growing and emerging in other categories HIGH-LEVEL CATEGORIES Ins MOA USHED BELOW LIGHTHOUSE CIN antipodes WINE #1 Global Sauvignon Blanc New Zealand Sauvignon Blanc "owns" the category and is now a "must have" Refreshing/summer afternoon positioning to females (vs. reds) Emerging in Pinot Noir and other reds Strong growth for 30+ years Strong and growing market share across Anglo markets Growing rapidly in Asia Attracting global brand leaders (e.g. LVMH Moët Hennessy Louis Vuitton) BEER/CIDER Focused on Australia Well regarded globally for the quality of its hops Benefiting from global shift to craft/specialty Leveraging long-term NZ strength in hops and apples Growth coming from global multinationals (e.g. Kirin, Heineken, Asahi) and local innovators Cider, in particular, stands out as having clear leverage and good long term growth prospects SPIRITS Focused on Australia Sector in early stages of growth curve Emerging sector driven by strong marketing and unique products Rapid innovation underway Still seeking "unique" position beyond "me-too" spirits JUICES Regionally strong in specific products Building on New Zealand's strength in export fruit, particularly in apples and kiwifruit Pioneer of a range of new fruits and fruit varieties No real leverage to date of existing strong fruit brands (e.g. Zespri, Jazz, Pacific Rose) SOFT DRINKS WATER Focused on Australia Early pioneer in energy drinks ("V") Growing strongly in a "post-CSD" environment [Carbonated Soft Drinks] Good fit with "Brand NZ" and existing strengths in select fruits Strong traction in "natural" positioned carbonated juices Emerging rapidly Huge hypothetical potential for growth Strong fundamentals Wide range of pioneers Second generation firms with strong products presentation and marketing (e.g. Antipodes) doing well Premium new comers Palaeo and OnePure EXAMPLE PRODUCTS UNDER THESE CATEGORIES Wine, bottles Beer Whisky/Whiskey Sparkling wine Vodka Bulk wine Gin Apple juice Kiwifruit/other juices Soft drinks Other flavoured beverages Bottled water Other water (e.g. bulk) CORIOLIS 42#43Wine currently accounts for 83% of New Zealand beverage exports, followed by soft drinks (7%) and a range of other beverages NEW ZEALAND EXPORT VALUE BY BEVERAGE SEGMENT US$; b; 2015 NEW ZEALAND EXPORT VALUE BY BEVERAGE SEGMENT US$; b; 2005-2015 Wine $1,073 83% Spirits $24 2% Other 7% Juice $51 4% Soft drinks, $90, 7% Water $7 1% Vinegar $2 0% Beer $26 2% $523 Cider $11 1% $453 $14 Source: UN Comtrade database (from NZ Customs data); Coriolis classifications and analysis $396 $332 $722 $14 $2 $815 $788 $644 $637 $560 $966 $774 $1,135 $28 719 $1,370 $29 $14 $1,290 $1,284 $1,260 $34 26 Beer $15 $1 Cider $45 $14 $1,123 $1,030 $985 $1,073 Wine $895 $44 $32 $29 $45 $24 Spirits $36 $37 $47 $68 $70 $60 $35 $67 $51 Juice $30 $29 $34 $48 $38 $24 $31 $36 $97 $102 $107 $90 $67 $50 $52 $64 $82 Soft drinks $55 $67 $3 $3 Water Vinegar 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 CORIOLIS 43#44Average export price varies by category, with wine standing out for high prices; wine is maintaining, but not growing pricing, across greater volumes; most other products shifting to quality GROWTH MATRIX: 10Y NUMBER VS. 10Y CAGR $/L VS. $/2015 L; US$/1; US$; 2005-2015 6%- Limited growth; shift to quality 10Y CAGR of average Juice NZ export Spirits value per 4%- litre Water Vinegar US$/1 05-15 Low/no price gains, though much greater volumes Weighted average $2.51 NEW ZEALAND EXPORT VOLUME VS. AVG $/L: BY SEGMENT L; millions; US$/l; actual; 2015 Average NZ export value/l US$/1 2015 $3.30 Wine $1.56 $1.20 $1.84 $2.03 Juice $0.97 Cider Vinegar Spirits Soft drinks 2%- Wine Beer 0% Soft drinks $0.64 Water $0.75 Beer Proportional to NZ export volume in 2015 Source: UN Comtrade database (from NZ Customs data); Coriolis classifications and analysis -2%- -4% - at lower prices Bubble size is proportional to Higher total dollars & volumes -6%- Cider export value in 2015; a bubble this size is US$100m $100m -8%7 I I I | -50 0 50 100 150 200 250 10y growth in export volume; l; m; 2005-2015 CORIOLIS 44#45New Zealand is growing its share of the global wine trade, but only maintaining share across most other beverages; cider appears to have stalled after solid growth (needs to transition beyond Australia) 3.4% Wine 3.2% NEW ZEALAND SHARE OF WORLD EXPORT VALUE BY CATEGORY US$; % of US$; 2015 NEW ZEALAND SHARE OF WORLD EXPORT VALUE BY CATEGORY % of US$; 2005-2015 NZ share of total global trade; % of $; 2015 3.4% Wine 0.8% Cider 0.5% 0.3% Soft drinks Juice 1.8% 1.6% 2.2% 2.0% 2.5% 2.8% 2.7% 3.0% 3.0% 10% 1.0% 0.9% 0.9% 0.9% 0.8% Cider 0.6% 0.6% 0.6% 0.6% 0.6% 0.5% 0.5% 0.5% 0.5% Soft drinks 0.4% 0.4% 0.4% 0.4% 0.4% 0.3% 0.4% 0.4% 0.3% Q.3% Juice 0.2% 0.3% 0.3% 8389 3% 0.3% 8 Water 0.3% 0.2% 8.2% 0.2% 0.3% 0.3% 0.2% Beer 02% 0.1% 0.1% 0.1% 0.2% 0.4% 0.1% 0.1% 0.1% 0.0% 0.1% 0.1% Spirits 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Beer Spirits 0.33% Water Vinegar Proportional to total global export value in 2015 Source: UN Comtrade database (from NZ Customs data); Coriolis classifications and analysis CORIOLIS 45#46WINE New Zealand has rapidly grown wine exports on the back of Marlborough Sauvignon Blanc, which is now a "must have" varietal across most major markets; Pinot Noir also achieving growing recognition NZ WINE EXPORT VALUE US$m; 2005-2015 SHARE OF NZ WINE GRAPE AREA BY VARIETAL % of ha; 1992-2016 10Y CAGR 10Y ABS $1,073 -$11- Sparkling wine -8% -$14 CAGR 12% $774 $4 Other red Merlot 8% 8% 8% 8% 8% 6% 7% 8% 7% 8% 8% 8% 10% 9% 10% 9% 9% 8% 8% 10% 11% 16% 16% 15% 15% 15% 15% 16 % 16% 15% Pinot Noir 13% 15% 17% 18% 19% 19% 18% 8% 15% 15% 14% 13% 12% 10% 10% 9% || | Cabernet Sauvignon Other White 7% 7% Pinot Gris 2% 2% Riesling $864 Wine, bottle 11% +$565 14% 15% 15% 17% 20% 23% 24% 24% 25% 25% 28% 30% 34% 36% 41% 43% 50% 53% 53% 53% 58% 58% 57% 57% 58% Sauvignon Blanc $685 $332 $25 22% 22% 23% 24% 26% 26% 28% 29% 29%29% 26% 23% $299 $198 Wine, bulk 38% +$190 22% 20% 18% 16% 12% 10% 8% 6% 4% 3% 2% 21% 19% 17% 16% 14% 13% 12% 12% 9% 9% 10% 10% 9% Chardonnay 60% Muller Thurgau 20% $84 -$8- 2015 2005 2010 AGGREGATE GLOBAL EXPORT GROWTH US$b; 2005-2015 EXAMPLE PRODUCTS: SAINT CLAIR 2017 CAGR 4% $22.7 $15.1 CAGR 8% CAGR 6% CAGR 5% $5.8 $6.1 $3.2 $3.6 $3.0 SAINT CLAIR SAINT CLAIR SAINT CLAIR $1.8 Suvignon Blan Pinot Gri Pinot Noir 05 15 Wine, bottle Wine, bulk Sparkling wine Brandy/Cognac Source: UN Comtrade database; photo credit (fair use; low resolution; complete product/brand for illustrative purposes); Coriolis classifications and analysis CORIOLIS 46#47BEER/CIDER New Zealand has had growing volumes of beer and cider exports, driven by increased interest in authentic, craft & premium; cider, in particular, appears well positioned for growth beyond Australia NZ BEER/CIDER EXPORT VALUE US$m; 2005-2015 CAGR 10% 10Y CAGR 10Y ABS $37 $36 $11 Cider 48% +$11 $10 $14 $0 $26 $26 Beer 7% +$13 $14 2005 2010 2015 AGGREGATE GLOBAL EXPORT GROWTH US$m; 2005-2015 $12.7 CAGR $8.1 5% 2005 Beer NZ BEER & CIDER EXPORT VALUE BY DESTINATION REGION US$m; 2015 $27.2 $3.1 Australia $24.0 USA $2.8 $0.6 United Kingdom $0.9 Other Pacific $3.2 Australasia Canada $0.3 $5.0 Other E/SE Asia $0.9 Other Europe Japan $2.3 China/HK $1.7 EXAMPLE PRODUCTS: MONTEITH'S 2017 AAA AAA MONTEITH'S Black MONTEITH'S Radles MONTEITH'S MONTEITH'S CRUSHED APPLE MONTEITH'S IGHTLY CRUSHED CIDER CIDER MONTEITH'S CREWING CO APPLE & PEAR CAGR 10% beer $1.4 2015 $0.5 2005 2015 Cider, etc. Source: UN Comtrade database; photo credit (fair use; low resolution; complete product/brand for illustrative purposes); Coriolis classifications and analysis CORIOLIS 47#48SPIRITS New Zealand has a rapidly evolving alcoholic spirits industry that is seeking its "signature" spirit in a large and growing global market NZ SELECT ALCOHOLIC SPIRITS EXPORT VALUE US$m; 2005-2015 $26 $47 $28 $24 GLOBAL ALCOHOLIC SPIRITS EXPORT VALUE US$b; 1965-2015 CAGR 9% $22.3 $35.2 $16.2 $14 10Y CAGR 10Y ABS RTD/Other alc. Spirits -3% -$5 $19 $10.4 $9.6 $7 $7.5 Gin -5% -$0 $0 Rum Vodka -2% -$0 $3.8 $3.5 -12% -$2 $7 $0.6 $1.0 $1.9 $6 Liqueurs 16% +$4 $3 $3 Whiskeys 7% +$1 1965 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015 2005 2010 2015 NZ INDUSTRY STRATEGIC DIRECTION Model; 2017 88 VAULT STOLEN ZEALAND BELOW EXAMPLE PRODUCTS: SIMPLY PURE NZ 2017 FUNDLAND BLUE DUCK BARE VODKA NEW ZEALAND BLACK ROBIN RARE GIN REWALAN RTD Beverages Made elsewhere bottled in NZ Conventional spirits made in NZ Conventional spirits made in NZ with NZ flavours New Zealand unique spirits Source: UN Comtrade database; photo credit (fair use; low resolution; complete product/brand for illustrative purposes); Coriolis classifications and analysis CORIOLIS 48#49NARTD* New Zealand non-alcoholic beverages growing well, driven by juices and other flavoured beverages; Australia still the largest market, but E/SE Asia emerging (particularly Japan and China) NZ NARTD EXPORT VALUE BY TYPE US$; m; 2005-2015 NZ NARTD EXPORT VALUE BY DESTINATION US$; m; 2015 $149 10Y CAGR 10Y ABS $92.7 $16.8 $3.5 $41.4 CAGR 7% $7 $10 Mineral water 11% +$5 Soft drinks -14% -$35 Japan $18.0 $110 $4. $80 Other flavoured bev. 30% +$75 Australia $83.7 $77 USA $16.0 $3 $57 China/HK $11.6 $45 $10 $35 Other juices 13% +$24 $6 $24 $10 $14 $14 $17 Apple juice 2% +$3 2005 2010 2015 AGGREGATE GLOBAL EXPORT GROWTH US$m; 2005-2015 $17,528 CAGR 5% $14,715 CAGR 8% $8,764 2005 2015 Juice $8,390 CAGR 3% Soft drinks Other unsweetened $2,402 $1,751 Water Other flavoured carbonated Other Pacific $9.0 Australasia Canada 5 N America $0.8 EXAMPLE PRODUCTS: KARMA COLA Co. 2015 *NARTD = Non-alcoholic ready-to-drink (industry term) Source: UN Comtrade database; photo credit (fair use; low resolution; complete product/brand for illustrative purposes); Coriolis classifications and analysis KARMA 00 5 8709 LEMMY lemonade Other Other E/SE Asia $11.8 E/SE Asia CORIOLIS 49#50New Zealand Growth & Innovation + Horizons for growth + Emerging export stars + Mega-trends driving change + Innovation & new products 04#51New Zealand firms continue to develop a range of innovative new beverage products THREE HORIZONS OF GROWTH - Beyond its mature core export products (Horizon 1), New Zealand has both a strong range of emerging export stars (Horizon 2) and continues to innovate and produce new, viable export options (Horizon 3) HORIZON 2: EMERGING EXPORT STARS - - In Horizon 2, New Zealand is building a range of emerging export products Two beverage products emerge as "growth stars" - cider and other flavoured beverages - from an evaluation of ten years of product- level trade growth Cider exports are growing and the product leverages New Zealand's strengths in apples and other fruit; performance of peers suggest stronger growth is possible in this rapidly developing category "Other flavoured beverages" [OFB] exports are growing and while currently highly reliant on the Australian market are also beginning to achieve strong growth into East and South-East Asia HORIZON 3: NEW, VIABLE OPTIONS - - - - In Horizon 3, New Zealand is creating and nurturing a wide range of viable options for future export success Four broad global consumer mega-trends are driving growth and new product development in the food & beverage industry New Zealand beverage products succeeding on-shelf in export markets are aligned with these trends These trends drive new product development, through (1) packaging, (2) product, (3) category and (4) channel innovation; success, however, often comes down to implementation and execution New Zealand beverage firms are delivering on packaging-driven innovation - New Zealand beverage firms are delivering on product-driven innovation - New Zealand beverage firms are delivering on category and channel innovation CORIOLIS 51#52Beyond its mature core (Horizon 1) export products, New Zealand has both a strong range of emerging export stars (Horizon 2) and continues to innovate and produce new, viable export options (Horizon 3) THREE HORIZONS OF GROWTH FRAMEWORK: NEW ZEALAND BEVERAGE INDUSTRY Model; 2017 FOCUS OF THIS SECTION Strategic Focus Key success factors Key metrics HORIZON 1 Mature export categories & products - Defend and extend profitability of core business - Efficiency & cost control - Process innovation - Scale Supply chain - - HORIZON 2 Build emerging export products Expand and grow emerging businesses & products Customer acquisition Speed & flexibility Execution Resources/funding HORIZON 3 Create viable export options - Develop and discover new options for growth Risk taking Market insight Business model innovation Culture & incentives - Profits, margins, costs - Market share, growth - Milestones Example products - Wine Source: McKinsey & Co.; Coriolis analysis - Soft drinks Cider Packaged water Whisky - Liqueurs CORIOLIS 52#53In Horizon 2, New Zealand is building a range of emerging export products THREE HORIZONS OF GROWTH FRAMEWORK: NEW ZEALAND BEVERAGE INDUSTRY Model; 2017 Strategic Focus Key success factors Key metrics HORIZON 1 Mature export categories & products - Defend and extend profitability of core business - - Efficiency & cost control Process innovation - Scale Supply chain HORIZON 2 Build emerging export products Expand and grow emerging businesses & products Customer acquisition Speed & flexibility Execution Resources/funding HORIZON 3 Create viable export options - - Develop and discover new options for growth Risk taking Market insight Business model innovation Culture & incentives - Profits, margins, costs - Market share, growth - Milestones Example products - Wine Source: McKinsey & Co.; Coriolis analysis Soft drinks Cider Packaged water Whisky - Liqueurs CORIOLIS 53#54Two beverage products emerge as "growth stars" - cider and other flavoured beverages - from an evaluation of ten years of product-level trade growth NZ BEVERAGE EXPORT GROWTH STAR MATRIX: 10Y VALUE GROWTH VS. 10Y CAGR $ VS. VALUE IN 2015 US$; CAGR on US$; 2005-2015 10y CAGR growth in 50%- Cider; other fermented: export 45%- value; US$; 05-15 40%- 35%- 30%- 25%- 20%- ⚫ Vinegar 15%- Other juices Liqueurs Mineral water 10%- Brandy/Cognac Whiskeys. Beer 5%- Mixed juice Apple juice 0% Other alc. spirits Sparkling wine Soft drinks Rum Vodka -5% 0 I 50 Other flavoured beverages I 100 Bubble size is proportional to export value in 2015; a bubble this size is $100.0 US$1b I 150 Wine, bulk Н Wine, bottle I 580 600 10y ABS growth in export value; US$; b; 2005-2015 Note: Data on this page is product level trade codes, not segment level aggregates as presented earlier (e.g. sweetened soft drinks and other flavoured beverages sum to soft drinks category) Source: UN Comtrade database (from NZ Customs data); Coriolis classifications and analysis CORIOLIS 54#55Cider exports are growing and the product leverages New Zealand's strengths in apples and other fruit; performance of peers suggest stronger growth is possible in this rapidly developing category CIDER EXPORT VALUE: NZ VS. SWEDEN US$; m; 2005-2015 $18 $30 $52 +$159m $74 $71' $0 $1 $2 $2 $82 $154 EXAMPLE: NZ PRODUCTS ON-SHELF Select; Feb 2017 $177 $175 Sweden Dan Murphy's LOWEST LIQUOR PRICE Australia GUARANTEE $171 MONTEITH'S $126 MONTEITH'S CRUSHED MONTEITH'S CRUSHED APPLE CIDER PEAR CIDER APPLE &PEAR MONTEITH'S Heritage CIDER $4 +$11m $10 $12 $14 $15 2011 2010 2009 MONTEITH'S CRUSHED SUMMER BERRUES ACIDER MONTEITH'S CRUSHED APRICOTS CCIDER SOTON EXAMPLE: IN-STORE DISPLAY Select; Feb 2017 THE COUNT JASON S EVES ROCHDALE ROCHDALE MONTEITH'S AUIGHTLY CRUSHED CIDER SAXTON SAXTON APPLE PEAR CIDER CIDER CLASSIC CLASSIC APPLE JACKS APPLE JACKS $14 $11 New Zealand OLD MOUT ORCHARD CIDER OLD MOUT CIDER INGER JIVE PAN DRY THIEVES © 2015 479 11.30 1 Singapore CRUSHED GIDER APPLI CIDER CHINER H CADETLE PEAR CIDER Source: UN Comtrade database (from NZ Customs data); photo credit (Coriolis or fair use; low resolution; complete product/brand for illustrative purposes); various published articles; Coriolis analysis CORIOLIS 55#56"Other flavoured beverages" [OFB] exports are growing and while currently highly reliant on the Australian market are also beginning to achieve strong growth into East and South-East Asia "OFB" EXPORT VALUE BY MARKET US$; m; 2005-2015 CAGR 30% $17 $89 $2 $2 $5 $80 EXAMPLE: NZ PRODUCTS ON-SHELF Select; Feb 2017 EXAMPLE: IN-STORE DISPLAY SINGAPORE Jasons Gourmet Grocer; Feb 2017 Singapore $6 E Asia $3 SE Asia $4 Other CHIA CHA CHIA $80 $35 $2 $68 Australia $31 $3 $3 $13 $3 $30 $27 $10 $2 $9 $6 $6 $5 $3 $2 $13 $1 $10 $3 $2 $2 $5 $6 $2 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Australia Australia Charlies FRUIT FIX spirulina SUGARFREE U BARANA ERGY D ENERG 250 HL Hong Kong Singapore Singapore Homegroun FEVER CHIA W-GOLD PRESSE THỊ THA 0 CHICHIA CHIA CHA TO WA LEMON GINGER & HONEY MANUKA HONEY So Sone Sub Source: UN Comtrade database (from NZ Customs data); photo credit (Coriolis or fair use; low resolution; complete product/brand for illustrative purposes); various published articles; Coriolis analysis CORIOLIS 56#57In Horizon 3, New Zealand is creating and nurturing a wide range of viable options for future export success THREE HORIZONS OF GROWTH FRAMEWORK: NEW ZEALAND BEVERAGE INDUSTRY Model; 2017 Strategic Focus Key success factors Key metrics HORIZON 1 Mature export categories & products - Defend and extend profitability of core business - - Efficiency & cost control Process innovation - Scale Supply chain - - - Profits, margins, costs - Example products - Wine Source: McKinsey & Co.; Coriolis analysis HORIZON 2 Build emerging export products HORIZON 3 Create viable export options Expand and grow emerging businesses & products Customer acquisition Speed & flexibility Execution Resources/funding Market share, growth - Develop and discover new options for growth Risk taking Market insight Business model innovation Culture & incentives Milestones - Soft drinks - Cider Packaged water Whisky - Liqueurs CORIOLIS 57#58Four broad global consumer mega-trends are driving growth and new product development in the food & beverage industry FOUR CONSUMER FOOD & BEVERAGE MEGA-TRENDS 13 HEALTH & WELLNESS I am concerned about my health and am trying to live a healthy lifestyle AUTHENTIC & RESPONSIBLE I am mindful of where my food comes from and how it is produced EASY & CONVENIENT I am trying to achieve work-life balance and need quick-and-easy meal solutions SENSORY & INDULGENT I like to indulge in rich and sumptuous living beyond the bare necessities Mid-high income countries experiencing an aging population Spread of Western lifestyle and Western diseases of affluence (e.g. diabetes) Ongoing waves of media hype around fad diets and new "superfoods" flavourings Food and drinks presented and viewed as both the problem and the solution Dramatic global shift to city living; 1800=3%, 1900=14%, 2015=50%; developed nations 75%+; 400 cities 1m+ Loss of attachment to the land and food production Ongoing "rights revolution" now spreading to animals (e.g. non dairy milk demand) Ongoing waves of food scares around contamination, additives Dramatic increase in female participation on the workforce globally Consumers working longer hours to maintain relative income Work hours no longer just "9 to 5"; food needs at all times (e.g. night shift) - Growing income polarisation into "haves and have-nots" Strongly emerging trend to premium (and discount) at the expense of the mid-market Emerging middle class across developing world driving consumption growth Incredible power of food and beverages in many social settings May be addressing specific conditions (e.g. weight management) May target a specific family member (e.g. grandparent, children) May reflect wider "healthy living" worldview May target specific foods perceived as high risk, unethical or visible (e.g. fairtrade coffee) May target a specific family member (e.g. child) May represent a need for an immediate solution (e.g. thirst) May represent an easy solution to a future challenge (e.g. single serve juice boxes for children's lunches) May range from "everyday luxury" to an occasional "treat" May be used to demonstrate social status, taste or style (e.g. top shelf spirit brands) Source: Boston Consulting Group; Datamonitor; Coriolis research and analysis CORIOLIS 58#59New Zealand beverage products succeeding on-shelf in export markets are aligned with these trends LOWEST Dan Murphy's LIQUOR PRICE Australia FTE Dan Murphy's LOWEST LIQUOR PRICE Australia H&W 25g of carbs H&W 5% alcohol H&W Sugarfree H&W Contains B vitamins A&R Sun ripened Nelson apples ZERO A&R Contains guarana A&R 100% New Zealand apples E&C Single-serve bottle U E&C Single-serve can E&C Shelf-stable MONTEITH'S E&C REWING CO STYLE Heritage E&C CIDER 15.0% Shelf-stable Ready-to-drink 500ml size S&I Crafted in a Traditional French Style S&I "Brewer's Series" release E&C Ready-to-drink 250ml size ENERGY ZERO SUGAR S&I A massive hit of energy Source: photo credit (fair use; low resolution; complete product/brand for illustrative purposes); various published articles; Coriolis research and analysis CORIOLIS 59#60These trends drive new product development, through (1) packaging, (2) product, (3) category and (4) channel innovation; success, however, often comes down to implementation and execution CONSUMER FACING INNOVATION IN THE FOOD & BEVERAGE INDUSTRY FROM TREND TO EXECUTION Simplified model; 2017 Source: Coriolis HEALTH & WELLNESS AUTHENTIC & RESPONSIBLE EASY & CONVENIENT SENSORY & INDULGENT CONSUMER FOOD & BEVERAGE MEGA-TRENDS NEW PRODUCT DEVELOPMENT 1. PACKAGING INNOVATION 2. PRODUCT INNOVATION 3. CATEGORY INNOVATION Usage (e.g. ready-to-drink) Shelf-life Convenience (e.g. multi-pack) Appearance (e.g. glass vs plastic) Cost (e.g. plastic vs. glass) Flavour Formulation/recipe New/different ingredients Source/origin Production system Manufacturing process Line extension Creation of new category New temperature state 4. CHANNEL INNOVATION Foodservice offer Non-foods retail offer Vending Internet/Home delivery Own retail stores IMPLEMENTATION & EXECUTION CORIOLIS 60#61New Zealand beverage firms are delivering on packaging-driven innovation 1. PACKAGING INNOVATION SELECT EXAMPLES OF PACKAGING INNOVATION: NEW ZEALAND BEVERAGE FIRMS 2017 COMMENTARY Traditionally water sold in plastic PET containers or bulk containers, expansion of premium waters in glass bottles Unique bottle shapes allow companies and brands to stand out on the shelf and to position themselves as premium Move from water as a commodity to water as a brand with status potential - packaging and messaging vital for this shift As technology such as foil packaging asceptic pouches becomes more available, beverage companies offering range of freezeable juices (e.g. Charlie's orange juice) Low barriers to entry - multiple brands on shelf and ongoing innovation in packaging and branding Traditional PURE Innovative ONEPURE ONEPURC INSIGHTS Unique bottles for water use Glass wine bottles Screwcap wine cap Positions water as a premium product suitable for fine-dining and the dinner table CHARLATAN PINOT NOIR INSIGHTS Misty Cove first New Zealand winery to produce canned wine The Embezzler and Charlatan are an edgy stylish pinot noir and sauvignon blanc Appealing to younger audience Source: photo credit (fair use; low resolution; complete product/brand for illustrative purposes; Blue River); various published articles; Coriolis analysis INSIGHTS Blue River Fresh Sheep milk in copper vacuum insulated bottle (500ml) Keeps cool for up to 48 hours or hot for 12 hrs Reusable and refillable at their store CORIOLIS 61#62New Zealand beverage firms are delivering on product-driven innovation 2. PRODUCT INNOVATION SELECT EXAMPLES OF PRODUCT INNOVATION: NEW ZEALAND BEVERAGE FIRMS 2017 COMMENTARY Small brands are driving ongoing innovation with a constant stream of new beverages on-shelf and in cafes - Products following trends in: Healthy tonics (e.g. Ti Tonic) Unique NZ (e.g. Aotea Native Tonics) Functional ingredients (e.g. Chia, Hopt) Gut health (e.g. Organic Mechanic OM Kombucha) Low sugar options (e.g. V 100% sugar- free) Lifestyle choices (e.g. Villa Maria "Light" wine) Premium (e.g. Garage Project gift wrapped "Touched Wood" beer Brands driving innovation and showing on- going shift into multiple channels and positions EXAMPLE: Phoenix Organics - Juices, Waters, Good Energy organic energy drinks, lemon concentrates, sparkling grape, new range of mixers for cocktails (soda water, lemonade, ginger ale, tonic, cola), recent shift into 750ml bottles Tí TOHICH Ti Ti Τί Ti Ti Ti TONICS INSIGHTS Scientifically developed Ti Tonic Uses New Zealand sourced grape seed and skin as antioxidant; white tea high in polyphenols; stevia and erythritol sweeteners Targeting the health conscious consumer VAAAA CHIAO CHIAO CHIA CHIA CHIAO AWAKA AWAKA INSIGHTS CHIA blended drinks with super-juices, high in nutrients and omega 3 Hydrated chia seeds make up between 75- 90% of the ingredients in the various flavours Targeting health conscious consumer 100% natural, gluten free, vegan, GE Free, No preservatives, No added sugar, 100% NZ owned and made INSIGHTS Villa Maria is a leading NZ wine company launch light wine Lighter in Alcohol (10%) and calories Launches range in Mar 2015 driven by customers demand for healthy lifestyle choices Part of 'Lifestyle Wines' research programme worth $16m over 7 years (PGP*) Source: photo credit (fair use; low resolution; complete product/brand for illustrative purposes); various published articles; Coriolis analysis CORIOLIS 62#63New Zealand beverage firms are delivering on category and channel innovation 3&4. CATEGORY & CHANNEL INNOVATION SELECT EXAMPLES OF CATEGORY & CHANNEL INNOVATION: NEW ZEALAND BEVERAGE FIRMS 2017 McCashin's Palaeo glacial water McCashin's Brewery based in the South Island is the brewer of the iconic Stoke range of beers McCashin's extended its non-alcoholic product range in March 2016 launching Palaeo water (still and sparkling) The water, sourced from a 350m deep bore on their site, is carbon- dated as being between 14,000 and 26,000 years old "Crystal clear and amongst the purest in the world, our Palaeo water comes from one of the oldest aquifers on earth" Palaeo water is distributed in NZ and throughout Asia www.stokebeer.co.nz Giesen's Cider and Wine Giesen Wines known for their premium NZ wines launch Hard Apple Cider and Wine The spritzer-style blend of hard apple cider and white wine all from NZ fruit This is a product extension for Giesen who are a traditional wine company Crafted NEW ZEALAND SPARKLING Garage Project canned beers and cellar door Garage Project a Wellington based craft brewery established in 2011 has successfully repositioned the can PALAEO PALAEO glacial water Healend Garage Project range of cans unique approach to branding includes artists designing labels for their beers; the aim, for the beers to stand out The cans are lighter to ship than glass bottles and recyclable Launched a new "wild" brewery in Wellington central Garage Project opened a cellar door at their brewery in Aro Valley and a Taproom with 18 beers on tap GIESEN HARD. APPLE GESEN HARD APPLE CIDER CIDER WINE WINE 465% Frucor's V-Pure branch into natural products offer Frucor's "V" energy drink is a 20 year success story, the leader domestically and exporting internationally Over the last 10 years V has launched: Berry, Lemon, Double Hit, Energy Blue, Graphite, Iced Coffee, 0% Sugar, Zero, Reactor, Iced Chocolate, Spiked Punch and various limited edition flavours V Pure was launched recognising the need for energy but recognising the shift to natural ingredients V Pure uses only six natural ingredients PURE Source: photo credit (fair use; low resolution; complete product/brand for illustrative purposes); various published articles; Coriolis analysis તેઓ SMOKE & MIRROR PURE Pat Se CORIOLIS 63#64New Zealand beverage firms are supported with access to advice, research facilities and pilot plants across five locations NZFIN New Zealand Food Innovation Network THE LOCATION *FOODBOWL FOODWAIKATO FOCUS Processed/FMCG foods Space/equipment for hire Export registrations ~1000 kg/shift Dairy & Infant Formula ~500 kg/hour Vegetable CAPABILITIES Extrusion & Milling/Blending Liquids/Beverage High pressure processing Freeze drying General processing Multiple packaging styles Product development kitchen Spray dryer Evaporator Other dairy equipment Packing Powder (vegetable) Source: www.foodinnovationnetwork.co.nz; Coriolis HAWKES BAY All Food and Beverage THE FOODPILOT FOODSOUTH Dairy Fruit & vegetables All Food and Beverage Processed/FMCG Foods Space/equipment for hire Export registrations 20-200L batch size Specialist expertise business development direct to other facilities Same equipment as Manukau (1/5th scale) Same equipment as Waikato (1/20th scale) Post harvest technologies Meat and small goods pilot plant Located at Massey University Mixing/Blending/Emulsifying Extrusion Freezing/Cooking/Baking General Processing Product Development Kitchen Technical and Business development expertise CORIOLIS 64#65New Zealand Beverage Firms + Enterprises + Employment + Turnover + Ownership + Foreign investors + Acquisitions + Investment + Rebranding + Leadership 05#66New Zealand has a strong and growing beverage industry that continues to attract investment OVERVIEW FINANCIAL PERFORMANCE - The number of beverage processing firms in New Zealand has grown over the past decade, driven by wine and beer New Zealand has a large and robust beverage products industry with a range of participants of varying sizes KEY METRICS - New Zealand's beverage industry is led by predominantly beer and soft drink focused firms, with a strong second tier of dedicated wine producers - The majority of the large beverage firms have foreign investment; the smaller wineries are predominantly privately owned INVESTMENT - Employment in beverage processing in New Zealand is growing, though slowly, as firms seek productivity gains Beverage processing is spread across the country, though Auckland and Marlborough stand out for absolute size - Employment growth rates vary by region - The wine industry is the major employer in the beverages section, accounting for half of all employees - However, at a firm level two of the three largest employers are primarily soft drink manufacturers - - The New Zealand beverage industry has attracted international investment from a wide range of sources Global firms investment in New Zealand firms is historical; however, new firms continue to invest in the sector More than $400m of acquisitions occurred over the last 18 months; global companies investing in innovative local craft and wineries looking to grow volumes Companies are investing in both land and plant to support strong growth in premium wines and craft beer - Beverage firms are also investing in new and improved marketing - New leadership continues to enter the industry or be promoted from within CORIOLIS 66#67The number of beverage processing firms in New Zealand has grown over the past decade, driven by wine and beer NUMBER OF BEVERAGE PROCESSING ENTERPRISES Enterprises; 2002-2012 375 231 405 261 435 441 468 285 294 321 612 CAGR 6% 588 561 549 528 363 366 10Y CHANGE IN BEVERAGE PROCESSING FIRMS BY TYPE ABS; CAGR; 2005-2015 642 10Y CAGR in enterprises 10%-> 9%- 8%- 10y ABS 10y CAGR 7%- 393 Wine & other 162 5% 384 387 6%- 378 5%- Spirits 4%- 33 Spirits 33 30 30 27 30 27 21 24 30 27 60 99 54 48 45 45 36 39 122 12 5% 3%- Soft Drinks. 2%- 120 Beer 72 10% 108 78 66 1% - 93 90 93 96 75 75 78 81 81 81 87 Soft Drinks, similar 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Source: Statistics NZ business demographics database; Coriolis analysis Beer Bubble size is proportional to firms in 2015; a bubble this size is 100 firms Wine & other 100 21 21 2% 0% T L T I 0 20 40 60 80 100 120 140 160 180 10Y ABS in # of enterprises CORIOLIS 67#68New Zealand has a large and robust beverage products industry with a range of participants of varying sizes LARGE BEER, CIDER & SPIRITS dbreweries INDEPENDENT Liquor CLOUDY BAY LARGER WINE NEW ZEALAND TREASURY WINE ESTATES LARGE SOFT DRINKS & WATER 0 SAINT CLAIR FAMILY ESTATE GİESEN VILLA MARIA CCA NEW ZEALAND COCA-COLA AMATIL NEW ZEALAND frucor BEVERAGES LIMITED Constellation Brands PARTNERS New Zealand indevin Yealands FAMILY WINES MARLBOROUGH NEW ZEALAND LION LION LION MEDIUM/SMALL BEER & CIDER SACRED HILL Pernod Ricard Winemakers DELEGAT N.Z. H 1991 HARRINGTON'S BREWERIES M McCASHIN'S BREWERY MEDIUM/SMALLER WINE KONO Seifried SCOTT P AMISFIELD WINE COMPANY CRAGGY RANGE Babich SOLJANS FAMILY WINEMAKERS ESTATE WINERY COOPERS CREEK NEW ZEALAND FOLEY FAMILY WINES KONO Pure taste of New Zealand MOA BREWING CO. Gibbston Valley HUNTER'S MARLBOROUGH MOUNT RILEY MEDIUM/SMALLER SOFT DRINKS & WATER A Accolade Wines MISSION ESTATE WINERY ENVICTUS NZOW New Zealand Quality Waters Ltd all good JP-NZ JUICE PRODUCTS NEW ZEALAND LIMITED CHIA +AWAKA WAIWERA ARTESIAN WATER EST. 1875 The Just Water BETTER Fist the best! DRINKS CO B PURE BOTTLING TASMAN BAY FOOD GROUP MILLS REEF WINERY PEGASUS BAY FINE WAIPARA WINE WP THE WINE PORTFOLIO NEW ZEALAND'S FINEST INVIVO CORIOLIS 68#69Employment in beverage processing in New Zealand is growing, though slowly, as firms seek productivity gains TOTAL EMPLOYMENT BY BEVERAGE MNFG. ENTERPRISES1 Headcount; as of Feb; 2000-2015 CAGR 1% 9,300 9,090 9,130 9,120 8,860 8,860 8,890. 8,720 8,740 8,420 8,220 10y ABS 10y CAGR 4,890 4,710 Wine & other 5,130 5,130 4,500 380 1% 16 4,640 4,660 4,790 4,710 4,330 4,560 GROWTH IN AVERAGE EMPLOYEES/MANUFACTURER Head/unit; 2005-2015 10Y CAGR in employees 3%- 2% - Soft Drinks 1%- 0% 470 460 420 Spirits -170 -3% -1%- 510 420 590 580 640 590 520 520 1,530 1,700 1,840 1,840 1,830 Beer 430 3% 1,400 1,430 1,400 1,390 1,430 1,460 -2%- -3% - Spirits Beer Wine & other Bubble size is proportional to employment in 2015; a bubble this size is 500 employees 500 1,900 1,850 1,890 1,980 2,050 2,050 2,180 2,080 2,080 2,110 2,160 Soft Drinks, similar 260 1% -4%7 | I I I -200 -100 100 200 300 I 400 | 500 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Note: 2015 data latest available as of February 2017; 1. Defined as C121100 -121400 Beverage Manufacturing; Source: Statistics NZ business demographics database; Coriolis analysis 10Y ABS in # of employees CORIOLIS 69#70Beverage processing is spread across the country, though Auckland and Marlborough stand out for absolute size; growth rates vary by region BEVERAGE PROCESSING EMPLOYMENT BY REGION Headcount; as of Feb; 2016 4,525 2,443 10Y CHANGE IN BEVERAGE PROCESSING EMPLOYMENT BY REGION ABS; CAGR; 2016 total; Headcount; as of Feb; 2006 vs. 2016 9%- 10Y Tasman/WC 321 CAGR 8%- Tasman/WC TMWW 7%- 6%- Auckland/Northland/Waikato 3,205 Marlborough 500 5%- 1,200 4%- 3%- Bubble size is proportional to employment in 2015; a bubble this size is 1,000 people 2%- Auckland/Northland/Waikato Otago/SL Canterbury 550 1%- BOP/Gisb/HB 930 TMWW 390 NI 0%- Marlborough Canterbury Otago/SL 372 BOP/Gisb/HB -1% I | I -10 0 100 200 300 400 SI TMWW Taranake, Manawatu-Wanganui & Wellington super-region; Source: Statistics NZ business demographics database; Coriolis analysis 10Y ABS | 500 CORIOLIS 70#71The wine industry is the major employer in the beverages section, accounting for half of all employees NUMBER OF PEOPLE EMPLOYED: NZ BEVERAGE MANUFACTURING BY INDUSTRY People; 2016 Beer 1,750 18% Soft Drinks 2,510 26% Spirits 440 5% Wine/Cider 4,900 51% COMMENTS/NOTES Beverage manufacturing does not include 100% pure juice or flavoured milk beverages; employee allocation is based on firms predominant activity TOTAL 9,600* * Beverage manufacturing does not include 100% pure juice or flavoured milk beverages; employee allocation based on firms predominant activity. Source: SNZ business demographics (detailed industry for enterprise units); various firm websites; published articles; Coriolis analysis CORIOLIS 71#72However, at a firm level two of the three largest employers are primarily soft drink manufacturers NUMBER OF PEOPLE EMPLOYED: NZ BEVERAGE MANUFACTURING BY KEY FIRM People; 2016 INCLUDES CORIOLIS ESTIMATES Other 4,090 43% Lion Co 1,273 13% Coca-Cola Amatil 1,000 10% Frucor Beverages 702 7% DB Breweries 500 5% Pernod Ricard Winemakers 430 4% Delegat Group 400 4% COMMENTS/NOTES - Lion Co is total New Zealand employees (includes dairy operations) TOTAL 9,600* Villa Maria Estate 300 3% Constellation Brands NZ 240 3% Yealands Wine Group 180 2% Independent Liquor 170 2% Giesen Wine Estate 165 2% Treasury Wine Estate 150 2% * Beverage manufacturing does not include 100% pure juice or flavoured milk beverages; employee allocation based on firms predominant activity. Source: SNZ business demographics (detailed industry for enterprise units); various firm websites; published articles; Coriolis analysis CORIOLIS 72#73New Zealand's beverage industry is led by predominantly beer and soft drink focused firms, with a strong second tier of dedicated wine producers ANNUAL TURNOVER BY TOP 10 FIRMS: NEW ZEALAND BEVERAGE INDUSTRY NZ$; m; FY2016 INCLUDES CORIOLIS ESTIMATES Lion Co Coca-Cola Amatil Frucor Beverages Independent Liquor DB Breweries Delegat Group $254 Treasury Wine $249 Estate Pernod Ricard Winemakers $241 Constellation Brands NZ Villa Maria Estate $170 $227 Source: various company annual reports; NZCO; Coriolis estimates and analysis $393 $366 $429 $532 $561 Actual from AR FY16 estimate from available data CORIOLIS 73#74The majority of the large beverage firms have foreign investment; the smaller wineries are predominantly privately owned ESTIMATED PROPORTIONAL SHARE OF TOTAL INDUSTRY TURNOVER BY OWNERSHIP % of turnover/sales; 2016 INCLUDES ESTIMATES PRO-RATA TO OWNERSHIP Fully INDEPENDENT Liquor doreweries TREASURY WINE ESTATES CLOUDY BAY HEW ZEALAND CRAGGY RANGE Pernod Ricard Winemakers Constellation Brands CCA NEW ZEALAND A Ame THE WINE PORTFOLIO COCA-COLA AMATIL JP-NZ ENVICTUS Partially LION NZQW FOLEY FAMILY WINES WAIWERA ARTESIAN WATER EST. 1875 The frucor BEVERAGES LIMITED BETTER DRINKSC SACRED HILL SILENI ESTATES Foreign 69% Source: New Zealand Companies Office; various annual reports; Coriolis estimates and analysis Public 6% FOLEY FAMILY WINES DELEGAT Just Water Fist the best! MOA BREWING CO. HUNTER'S MARLBOROUGH GIESEN Private 25% VILLA MARIA Yealands = FAMILY WINES MARLBOROUGH NEW TERLAND 0 SAINT CLAIR FAMILY ESTATE (M) MECASHIN'S BREWERY NEW ZEALAND COOPERS CREEK Gibbston Valley NEW ZEALAND N.Z. 1991 ·H· HARRINGTON'S BREWERIES ALLAN Seifried WAIWERA SCOTT ARTESIAN WATER EST. 1875 MILLS REEF WINERY MOUNT RILEY PEGASUS BAY FINE WAIPAKA WINE SACRED HILE SILENI ESTATES AMISFIELD Etc. WINE COMPANY CORIOLIS 74#75The New Zealand beverage industry has attracted international investment from a wide range of sources Asahi Leading beverage firm in Japan Revenue ¥1.8t The BETTER DRINKSC. Leading premium NZ beverage company HEINEKEN Leading global beer company Revenue +€20b bb_ dibreweries Leading NZ beer company SunTORY Leading Japanese food and beverage company frucor BEVERAGES LIMITED Frucor beverage company adding to its NZ based portfolio Constellation Brands Leading US beverage company Revenue $US6.5b NOBILO Leading NZ wine company Sumitomo Corporation One of the world's largest trading Companies (Japan) VVJP-NZ JUICE PRODUCTS NEW ZEALAND LIMITED A South Island fresh juice company Eng Tee Wee Private investor, Singapore NZOW New Zealand Quality Waters Ltd Bottle water company Source: Coriolis analysis CORIOLIS 75#76Global firms investment in New Zealand firms is historical; however, new firms continue to invest in the sector 2011 and earlier 2012-2014 Sumitomo Corporation KIRIN LION Asahi SUNTORY HEINEKEN JEBSEN Pernod Ricard Winemakers Constellation Brands LVMH MOET HENNESSY. LOUIS VUITTON TREASURY WINE ESTATES CCA COCA-COLA AMATIL NEW ZEALAND Giffith (Private, USA) CH A CHAMP PRIVATE EQUITY BELVINO INVESTMENTS 長江和記實業有限公司 CK HUTCHISON HOLDINGS LIMITED challenger 2015+ Ordover Trust (USA) Eng Tee Wee (Singapore) CORIOLIS 76#77More than $400m of acquisitions occurred over the last 18 months; global companies investing in innovative local craft and wineries looking to grow volumes PANHEAD CUSTOM ALES $25m* LION dbreweries TUATARA $10m** -BREWERY. indevin PARTNERS New Zealand Ara GİESEN TODD CORPORATION Marlborough Lines Yealands FAMILY WINES - MARLBOROUGH NEW ZEALAND SAINT CLAIR FAMILY ESTATE LIQUID⚫ ASSETS $250- 300m Lion acquires craft brewer Panhead Custom Ales - launched 2013 in Upper Hutt; following on from acquisition of Emerson's brewery in 2013; July 2016 DB Breweries acquires Kapitai based boutique brewing company Tuatara from Rangatira Ivnestmetns Implied total value of $10m; Jan 2017 Indevin acquires vineyards associated with Winegrowers Ara a total of 1,500 ha in Waihopai Valley; estimated value of $280m; Feb 2016 Giesen acquires Ara wine brand from Winegrowers Ara; production shifts to Giesen's, bottling at Wineworks; additional volume ensures additional growth and presence in premium markets (e.g. USA, UK); June 2106 Peter Yealand sold 80% of company to the NZ-based utility company; July 2017 $89m N/A Saint Clair acquires 50ha of vineyards, distribution network and brand (wine made at Marlborough Vintners); May 2016 LAKE CHALICE THIS IS STOLEN $21m US based VC Liquid Asset Brands and Spirits Investment Partners acquire Stolen Spirits, established in 2010; looking to expand in USA; Oct 2015 * "it was $10million purchase price plus $15million max potential earn out over 4 years" ** Industry estimate; Source: Coriolis CORIOLIS 77#78Companies are investing in both land and plant to support strong growth in premium wines and craft beer EXTENDING WINE CAPACITY +$100m DELEGAT New winery under construction in Hawkes Bay; 13,000 m² building to support new farm vineyards Emerson's $25m Brewery Dunedin $29m - DELEGAT THE BOTTLING COMPANY N/A Yealands FAMILY WINES - MARLBOROUGH NEW ZEALAND $4.35m N/A GIESEN SPY VALLEY WINES $1.2m $30m VILLA MARIA NEW ZEALAND Acquires 838ha farm in Hawkes Bay to meet strong growth in global demand for super premium wines (Oyster Bay) adding 550,000 9L cases a year to portfolio when producing; adjacent to existing vineyard Establishment of a new contract bottling company in Riverlands Industrial Estate, Marlborough; able to process 6,000 bottles/hr Investment in 266ha land adjacent to existing vineyard in Awatere Valley GARAGE ARO ST WELLINGTON PROJECT CCA COCA-COLA AMATIL NEW ZEALAND Expansion of wine production facility at Riverlands Industrial Estate Investment in plant and infrastructure, new wine presses to increase production quality and volume Expansion of Te Awa Estate winery Hawkes Bay Source: annual reports, new articles, company websites, Coriolis estimates INCREASING SCALE Investment by Lion in Emerson's new brewery, tap-room and restuaruant - increasing volume to 8mL/yr N/A New brewery with bStudio in Hawkes Bay to increase volumes N/A Built a 10,000m² Keri Juice plant commissioned Sep '16 CORIOLIS 78#79Beverage firms are also investing in new and improved marketing Hansells INCO 1907 TM Rebranding New Packaging Advertising & Promotion HANSELLS™ EST. 1914 CRANBERRY FINWADA RASPBERRY T MANDA LIME BITTERS OUR ALL NATURAL FRUIT SYRUPS HAVE NO ARTIFICIAL COLOURS, FLAVOURS, PRESERVATIVES OR SWEETENERS, AND ARE AT LEAST 25% LOWER IN SUGAR THAN THE AVERAGE OF THE TOP 10 SELLING CORDIALS IN NZ THE ORIGINAL L&P LEMON & PAEROA SINCE AGES AGO i&P LEMON 4 PAERDA GOOD LEMONISH STOIT &P LIVE חייו NEW SHOW OUT WEEKLY Source: photo credit (various firms or fair use; low resolution; complete product, brand or promotional image for illustrative purposes); various published articles; Coriolis analysis CORIOLIS 79#80New leadership continues to enter the industry or be promoted from within Yang Shen Estate Director Cloudy Bay Vineyards Note: No other firms provided photos Kevin Bowler CEO - NZ Frucor Beverages Simon Towns Managing Director Constellation Brands NZ Adrian Garforth MW CEO Yealands Wine Group Angus McPherson MD-AU & NZ Treasury Wine Estate CORIOLIS 80#81New Zealand Beverages Firm Profiles 05#82ACCOLADE WINES NZ ALLAN SCOTT WINES & ESTATES A Accolade Wines CHAMP PRIVATE EQUITY Jack Glover General Manager DESCRIPTION: Wine producer and marketer; Waipara Hills, Dusky Sounds, Mud House, Nobilo, Drylands, Ta_Ku, Monkey Bay, Haymaker brands; parent company headquartered in Australia, 5th largest wine company in world ALLAN SCOTT FAMILY WINEMAKERS Allan Scott Director DESCRIPTION: Winery and restuarant; Allan Scott, Moa Ridge, Scott Base brands; Marlborough and Central Otago vineyards AMISFIELD A AMISFIELD Craig Erasmus Chief Executive Officer DESCRIPTION: Cellar door and restaurant based in Queenstown; estate vineyard in Central Otago; Amisfield, Lake Hayes brands BABICH WINES LTD Babich Joe Babich Managing Director DESCRIPTION: Family owned wine producer; vineyards in Auckland, Hawke's Bay and Marlborough KEY PRODUCTS: Wine KEY PRODUCTS: Wine KEY PRODUCTS: Wine KEY PRODUCTS: Wine OWNERSHIP: AU; PE (CHAMP (AU) 80%, Constellation Brands (USA) 20%) via Accolade Wines AU COMPANY NUMBER: 4661159 ADDRESS: 22 Liverpool Street, Riverlands Estate, Blenheim PHONE: +64 3 520 6011 WEBSITE: www.accolade-wines.com; www.mudhouse.co.nz YEAR FORMED: 2013 STAFF EMPLOYED: 90 REVENUE: $41m (FY16) COMPANY HIGHLIGHTS: Parent company acquired Lion Australia's premium wine business, Fine Wine Partners, 6 Australian brands, 4 wineries, in Feb '17; $1b+ ASX IPO listing considered but ultimately postponed in early '17 OWNERSHIP: NZ; Private (Scott) COMPANY NUMBER: 608289 ADDRESS: Jacksons Road, Blenheim PHONE: +64 3 572 9054 WEBSITE: www.allanscott.com YEAR FORMED: 1990 STAFF EMPLOYED: 28 REVENUE: $15-20m* COMPANY HIGHLIGHTS: Tasting room opened in Cromwell in '15; Allan Scott released autobiography in '16 OWNERSHIP: NZ; Private (Darby/Kayne) COMPANY NUMBER: 3312291 ADDRESS: 10 Lake Hayes Road, Queenstown PHONE: +64 3 442 0556 WEBSITE: www.amisfield.co.nz OWNERSHIP: NZ; Private (Babich Family) COMPANY NUMBER: 57990 ADDRESS: 15 Babich Road, Henderson Valley, Auckland PHONE: +64 9 833 7859 WEBSITE: www.babichwines.co.nz YEAR FORMED: 1999 STAFF EMPLOYED: 70 REVENUE: $10-15m (FY16) YEAR FORMED: 1916 STAFF EMPLOYED: 65 REVENUE: $30-40m* COMPANY HIGHLIGHTS: COMPANY HIGHLIGHTS: First vintage in new Babich Marlborough winery in '14, 4,000 t processed; acquired 79ha Echelon Vineyard in Waihopai Valley in '14; extensive global PR campaign to celebrate 100 years in '16 * Estimate; Source: various companies annual financial statements (NZ Companies Office or company website); various press releases and news articles; Coriolis analysis CORIOLIS 82#83BEVPAC NEW ZEALAND/ TSL PLASTICS CLOUDY BAY VINEYARDS CLOUDY BAY NEW EALAND LVMH POST HONNEOUS KUNTON COCA-COLA AMATIL NZ CCA COCA-COLA AMATIL NEW ZEALAND CONSTELLATION BRANDS NZ/ NOBILO HOLDINGS Constellation Brands Graham Lundie Managing Director DESCRIPTION: Carbonated beverage manufacturers and contract packers; Jolly brand, house brands; P.E.T bottle manufacturer company Yang Shen Estate Director DESCRIPTION: Wine maker based in Marlborough; Cloudy Bay, Pelorus, Te Koko, Te Wahi; sister company Cape Mentelle in Western Australia Chris Litchfield Managing Director DESCRIPTION: Manufacturer and distributor of soft drinks, juice and water, with some brands under license from Coca-Cola USA; 4 production facilities located in Auckland, Putaruru, Christchurch Simon Towns Managing Director DESCRIPTION: Grower and maker of wines; Nobilo, Kim Crawford, Selaks, Monkey Bay, Drylands, VNO, The People's Wine, Crafters Union, Wild Grace Wines KEY PRODUCTS: Contract beverage filling OWNERSHIP: NZ; Private (Lundie, Simth, Mazur, Borich) KEY PRODUCTS: Wine, cellar door, tourist experiences OWNERSHIP: France; Public (Euronext:MC); (Groupe Arnault 46%, Diageo 34%) KEY PRODUCTS: Soft drinks, juices, water, flavoured dairy, alcoholic spirits, beer, cider, energy drinks, coffee OWNERSHIP: AU; Public (Coca-Cola Amatil Limited (ASX:CCL)) KEY PRODUCTS: Wine OWNERSHIP: USA; Public (Constellation Brands Inc (NYSE:STZ)) COMPANY NUMBER: 803057/286873 ADDRESS: 76 Lady Ruby Drive, East Tamaki, Auckland PHONE: +64 9 914 7180 WEBSITE: www.tslplastics.nz YEAR FORMED: 1996/1986 STAFF EMPLOYED: 50 REVENUE: $15-20m COMPANY NUMBER: 271895 ADDRESS: 230 Jacksons Road, Blenheim, Marlborough PHONE: +64 3 520 9147 WEBSITE: www.cloudybay.co.nz; www.lvmh.com YEAR FORMED: 1985 STAFF EMPLOYED: 50 REVENUE: $52m (FY15) COMPANY NUMBER: 440039 ADDRESS: The Oasis, Mt Wellington, Auckland PHONE: +64 9 570 3000 WEBSITE: www.ccamatil.co.nz; www.ccamatil.com YEAR FORMED: 1907 STAFF EMPLOYED: -1,000 REVENUE: $532m (FY15) COMPANY NUMBER: 1477933 ADDRESS: 45 Station Road, Huapai-Kumeu, Auckland PHONE: +64 9 412 6666 WEBSITE: www.constellationnz.com; www.cbrands.com YEAR FORMED: 2004 STAFF EMPLOYED: 240 REVENUE: $227m (FY16) COMPANY HIGHLIGHTS: COMPANY HIGHLIGHTS: New Estate Director moved from Domain Chandon in China '16 to focus on high quality Sauvignon Blanc, Chardonnay, Pinot Noir and Pelorus Methode; raising the profile of Central Otago Pinot Noir to meet market demand. COMPANY HIGHLIGHTS: Coca Cola Amatil and Beam Suntory distribution partnership in NZ in '15; AON Hewitt Best Employer '16; Rainbow Tick Accreditation '16; Monster Energy Drinks partnership '16; 10,000m2 Keri Juice plant commissioned Sep '16, can produce 800,000 bottles a day * Estimate; Source: various companies annual financial statements (NZ Companies Office or company website); various press releases and news articles; Coriolis analysis COMPANY HIGHLIGHTS: New CEO May '16, from Constellation Brands in San Francisco; Nov '16 acquires 21ha in Central Otago for pinot noir production; opportunities to grow NZ brands in Australia; plans to double Drylands, Marlborough capacity over '17-'18 to fill US demand CORIOLIS 83#84COOPERS CREEK VINEYARD COOPERS CREEK NEW ZEALAND CRAGGY RANGE VINEYARDS DB BREWERIES LTD DELEGAT GROUP DELEGAT Andrew Hendry Managing Director DESCRIPTION: Winery, vineyard and cellardoor; around 130,000 cases of wine sold a year in over 20 countries KEY PRODUCTS: Wine CRAGGY RANGE Michael Wilding Chief Executive Officer DESCRIPTION: Wine makers across five vineyards; sales and distribution subsidiary in Australia; 2 wineries, Gimblett Gravels Winery and Giants Winery; cellar door, restaurant and accommodation; member of Family of Twelve KEY PRODUCTS: Wine divers HEINEKEN Andy Routley Managing Director DESCRIPTION: Manufacturer of beer and cider; Heineken, Tiger, Monteith's, DB Export, Tui, Black Dog, Old Mout, Orchard Thieves, etc.; market leader in cider with 45% share; 60% owned subs. JV in Barworks Group, 23 gastro pubs & events; 100% owned Drinkworks, AU sales & distribution KEY PRODUCTS: Beer, cider, RTDs Jim Delegat Executive Chairman DESCRIPTION: Wine maker; Oyster Bay, Delegat, Barossa Valley Estate; 20 vineyards; sales teams in UK, Ireland, USA, Canada, Australia, Japan, Singapore, China, New Zealand KEY PRODUCTS: Wine OWNERSHIP: NZ; Private (Hendry, Smith 81%, others) OWNERSHIP: AU; Private (Tandom Pty (Peabody) 50%); HK; Private (Chamois Ltd 50%) OWNERSHIP: Netherlands; Public (Heineken N.V (AMS:HEIO)) via Heineken Asia Pacific (Singapore) OWNERSHIP: NZ; Public (NZX:DGL) (Delegat 66%) COMPANY NUMBER: 93470 ADDRESS: 601 State Highway 16, Huapai, Auckland PHONE: +64 9 412 8560 WEBSITE: www.cooperscreek.co.nz COMPANY NUMBER: 912925 ADDRESS: 253 Waimarama Road, Havelock North PHONE: +64 6 873 7126 WEBSITE: www.craggyrange.com STAFF EMPLOYED: 130 YEAR FORMED: 1980 STAFF EMPLOYED: 25 (+5 seasonal) REVENUE: $12-15m* YEAR FORMED: 1997 COMPANY NUMBER: 71013 ADDRESS: 1 Bairds Road, Otahuhu, Auckland PHONE: +64 9 259 3000 WEBSITE: www.db.co.nz; www.dbsustainability.co.nz YEAR FORMED: 1929/1966 STAFF EMPLOYED: 500 REVENUE: $366m (FY16) COMPANY HIGHLIGHTS: COMPANY NUMBER: 523716 ADDRESS: Level 1, 10 Viaduct Harbour Avenue, Auckland PHONE: +64 9 359 7300 WEBSITE: www.delegats.com YEAR FORMED: 1947/1991 STAFF EMPLOYED: +400 REVENUE: $254m (FY16) REVENUE: $29m (FY16) COMPANY HIGHLIGHTS: New World Winery of the Year in '14 by Wine Enthusiast COMPANY HIGHLIGHTS: Parent Asia Pacific now fully controlled by Heineken '13; Redwood Cider amalgamated into business in '14; acquired boutique brewery Tuatara Brewing Company in Jan '17 COMPANY HIGHLIGHTS: $107m in capital expenditure '14/'15; record global case sales of 2.4m, EBITDA of $96.5m in '16; inaugural vintage for new state of the art Hawke's Bay winery in '16; most gold and 90+ ratings in company history in '16 * Estimate; Source: various companies annual financial statements (NZ Companies Office or company website); various press releases and news articles; Coriolis analysis CORIOLIS 84#85ENVICTUS NZ FOLEY FAMILY WINES NZ FOLEY FAMILY WINES FRUCOR BEVERAGES ENVICTUS Neil McGarva Chief Executive Officer Envictus Dairies NZ DESCRIPTION: 72% partner in JV Envictus Dairies NZ, manufacturer of UHT aseptic PET liquids: dairy, juice, alternative dairy and water products; factory in Whakatu; exports to China, Taiwan, Japan, AU; Naturalac Nutrition "Horleys" sports nutrition subsidiary; milk drying outsourced; contract packs KEY PRODUCTS: UHT milk, flavoured milk, pet milk, fruit juice, sports nutrition beverages, weight loss water, coconut milk, almond milk OWNERSHIP: Malaysia; Public (Envictus International Holdings) Mark Turnbull Chief Executive Officer DESCRIPTION: USA wine company; Vavasour, Grove Mill, Te Kairanga, Goldwater, Dashwood, Clifford Bay, Sanctuary, The Pass, Boatshed Bay, Babbling Brook, Walking Birds, Martinborough Vineyard brands; 4 wineries; Lighthouse Gin brand KEY PRODUCTS: Wine, gin OWNERSHIP: NZ; Public (NZX:FFW) (Foley (USA; Private) 66%, NZ Central Securities 17%, others) frucor SUNTORY Kevin Bowler Chief Executive Officer NZ DESCRIPTION: Manufacturer of soft drinks, juices and other beverages; brands include V Energy, Just Juice, Sparkling OH!, Fresh Up, McCoy, OVI, Citrus Tree, Mizone, Simply Squeezed, etc.; 20m cases of drink products/year from South Auckland plant; bottles and distributes Pepsico products in NZ KEY PRODUCTS: Energy drinks, juice, sports drinks, water, carbonated soft drinks OWNERSHIP: Japan; Private; (Suntory Holdings Ltd (Kotobuki Realty 90%, Torii, others)) GIBBSTON VALLEY Gibbston Valley Greg Hunt Chief Executive Officer DESCRIPTION: Winery, restaurant, wine tours; based in Queenstown KEY PRODUCTS: Wine OWNERSHIP: USA; Private (Griffith, Pike) COMPANY NUMBER: 1863590 ADDRESS: 44 Johnston Way, Whakatu, Hastings PHONE: +64 6 650 3000 WEBSITE: www.envictus-intl.com; www.horleys.com YEAR FORMED: 2006 STAFF EMPLOYED: 33 FTE REVENUE: $19m (FY16) COMPANY NUMBER: 307139 ADDRESS: 13 Waihopai Valley Road, Blenheim PHONE: +64 3 572 8200 WEBSITE: www.nzwineco.co.nz; www.ffw.co.nz; www.lighthousegin.co.nz YEAR FORMED: 1986 STAFF EMPLOYED: 65 REVENUE: $35m (FY16) COMPANY NUMBER: 913026 ADDRESS: 86 Plunket Avenue, Manukau City, Auckland PHONE: +64 9 250 0100 WEBSITE: www.frucor.com YEAR FORMED: 1962 STAFF EMPLOYED: 684 REVENUE: $429m (FY15) COMPANY NUMBER: 449621 ADDRESS: 1820 State Highway 6, Gibbston, Queenstown PHONE: +64 3 442 6910 WEBSITE: www.gibbstonvalley.com YEAR FORMED: 1990 STAFF EMPLOYED: 55 REVENUE: $5-10m* COMPANY HIGHLIGHTS: Name change in '14 after Etika's global sale of dairy business; looked to sell Envictus Dairies in Feb '16 for $20m but agreement lapsed; launched RTD sports nutrition beverage, protein drinks, developed non-dairy nut milks and developing drinking yoghurt and real coffee products in '17 COMPANY HIGHLIGHTS: Acquired Lighthouse Gin in '14; invested in new warehouse at Grove Mill, $2.2m in '15; emphasis on selling branded product rather than bulk wine in '16; earthquake damage of over $1m in Nov '16 to Grove Mill Winery COMPANY HIGHLIGHTS: Jun '16 launch "V Pure" using 6 natural ingredients COMPANY HIGHLIGHTS: Original Home Block vineyard certified organic in '14 * Estimate; Source: various companies annual financial statements (NZ Companies Office or company website); various press releases and news articles; Coriolis analysis CORIOLIS 85#86GIESEN WINE ESTATE HARRINGTON'S BREWERIES N.Z. ·H· 1991 HARRINGTON'S BREWERIES BRI HUNTER'S WINES (NZ) LTD HUNTER'S MARLBOROUGH INDEPENDENT LIQUOR INDEPENDENT Liquor GIESEN Theo, Alex and Marcel Giesen Directors (Marcel right) DESCRIPTION: Marlborough centric wine company with grapes throughout NZ; Cellar door in Marlborough; 93% of wine exported; #1 market Australia; Kaiser Brothers Brewery operating out of Head Office in Canterbury KEY PRODUCTS: Wine, cider, beer Carl Harrington Managing Director DESCRIPTION: Beer and cider manufacturer; contract brewing and bottling KEY PRODUCTS: Beer, cider Jane Hunter Managing Director DESCRIPTION: Winery and restaurant; Hunters and Spring Creek brands; output of around 100,000 cases of wine; export approximately 85% of production KEY PRODUCTS: Wine Asahi James Collins Country Manager - NZ DESCRIPTION: Distiller of spirits (Woodstock, Cruiser, Cody's, Boundary Road, Long White, Canterbury Cream, others); brewer of beer (Calsberg, Asahi, NZ Pure, Haagen, Wild Buck, Founders); cider (Somersby, Wild Side, Honesty Box) KEY PRODUCTS: Beer, RTDs, cider, spirits OWNERSHIP: NZ; Private (Giesen) OWNERSHIP: NZ; Private (Harrington) OWNERSHIP: NZ; Private (Hunter) OWNERSHIP: Japan; Public (Asahi Group Holdings (TYO:2502)) COMPANY NUMBER: 1004906 ADDRESS: 46B Halwyn Drive, Hei Hei, Christchurch PHONE: +64 3 344 6270 WEBSITE: www.giesen.co.nz COMPANY NUMBER: 138071 ADDRESS: 6 Tenahaun Place, Wigram, Christchurch PHONE: +64 3 929 0107 WEBSITE: www.harringtons.nz YEAR FORMED: 1991 YEAR FORMED: 1981 STAFF EMPLOYED: 105 (+60 seasonal) REVENUE: $70-80m STAFF EMPLOYED: 21 REVENUE: $10-20m (FY16) COMPANY NUMBER: 140641 ADDRESS: 603 Rapaura Road, Blenheim PHONE: +64 3 572 8489 WEBSITE: www.hunters.co.nz YEAR FORMED: 1979 STAFF EMPLOYED: 25 REVENUE: $7-10m (FY16) COMPANY NUMBER: 354989 ADDRESS: 35 Hunua Road, Papakura, Auckland PHONE: +64 9 298 3000 WEBSITE: www.independentliquor.co.nz; www.asahigroup-holdings.com YEAR FORMED: 1987 STAFF EMPLOYED: 170 REVENUE: $393m (FY15) COMPANY HIGHLIGHTS: Added Barossa Valley's Peter Lehmann Wines, owned by Casella Family Brands into distribution business in '15 along with Mirabeau Rose from Provence; awarded champion pinot noir at the 2016 IWSC in the UK and outstanding medal, plus three champion titles at the Air NZ Wine Awards; Jun '16 purchased Ara brand, UK presence; brewery operational in '16 COMPANY HIGHLIGHTS: Acquired Matson's Brewery in '14; moved operations from Ferry Road into new purpose built premises at Wigram in '16; invested $2m Italian bottling line in '16; exited hospitality and retail side of business in '16; current focus on H&S and lean manufacturing programmes COMPANY HIGHLIGHTS: New winemaking team in '16 * Estimate; Source: various companies annual financial statements (NZ Companies Office or company website); various press releases and news articles; Coriolis analysis COMPANY HIGHLIGHTS: "The Mill" chain sold to Foodstuffs in Oct '15 for $12m CORIOLIS 86#87INDEVIN GROUP LTD indevin PARTNERS New Zealand INVIVO WINES NEW ZEALAND INVIVO JUICE PRODUCTS NZ LTD VVJP-NZ Sumitomo Corporation JUST WATER INTERNATIONAL Just Water Just the beat! Duncan McFarlane Group Chief Executive Officer DESCRIPTION: Integrated wine supply co., owning and operating vineyards and wineries in Marlborough, Gisborne and Hawkes Bay. Largest New Zealand owner of vineyards and vineyard land. Have a large contract grower portfolio. Acquired parts of Lindauer assets from Pernod in 2010. KEY PRODUCTS: Wine Rob Cameron Managing Director DESCRIPTION: Wine makers; vineyards in Marlborough and Central Otago; produce Graham Norton wines Noboru Saeki Chief Executive Officer DESCRIPTION: Manufacturer of fruit and vegetable juices, concentrates, purees, blends; facility in Timaru; export to Asia, USA, AU; processes 70,000t, 70% of NZ carrot crop Tony Falkenstein Chief Executive Officer DESCRIPTION: Water coolers and water distribution to offices and homes; 3 bottling plants OWNERSHIP: NZ; Private (Wallace 88%, others) KEY PRODUCTS: Wine, low alcohol and calorie wine, spritzers OWNERSHIP: NZ; Private (Lightbourne, Cameron, Dark, others) KEY PRODUCTS: Carrot and fruit juice concentrate, fruit and vegetable purees, fruit and vegetable pulp OWNERSHIP: Japan: Public (Sumitomo Corporation (TYO: 8053)) KEY PRODUCTS: Water coolers, drinking water, filters OWNERSHIP: NZ; Public (NZX:JWI) (The Harvard Group 68%, others) COMPANY NUMBER: 3164447 ADDRESS: 17-19 Winefair Close, Blenheim PHONE: +64 3 520 6810 WEBSITE: www.indevin.com COMPANY NUMBER: 1861924 ADDRESS: 55 Te Kauwhata Road, Te Kauwhata PHONE: +64 9 630 6360 WEBSITE: www.invivowines.com YEAR FORMED: 2003 STAFF EMPLOYED: 220FTE+180 seasonal REVENUE: $100m+ YEAR FORMED: 2006 STAFF EMPLOYED: 15-20 REVENUE: $5-10m* COMPANY NUMBER: 1207153 ADDRESS: 55 Sheffield Street, Washdyke, Timaru PHONE: +64 3 687 4170 WEBSITE: www.jp-nz.com; www.sumitomocorp.co.jp YEAR FORMED: 1993 STAFF EMPLOYED: 26 perm. 30 seasonal REVENUE: $27m (FY16) COMPANY NUMBER: 368825 ADDRESS: 103 Hugo Johnston Drive, Penrose, Auckland PHONE: +64 9 630 1300 WEBSITE: www.justwater.co.nz; www.jwi.co.nz YEAR FORMED: 1989 STAFF EMPLOYED: 84 FTE 40 casual REVENUE: $16m (FY16) COMPANY HIGHLIGHTS: Acquired Todd Corporation vineyard holdings in Marlborough '16, 600ha of vines, 900ha of bare land suitable for further plantings, the brand Ara was sold to Giesen Wines COMPANY HIGHLIGHTS: Launched Graham Norton's '16 Sauvignon Blanc and Shiraz, blending session in Ireland to create the wines; '15 vintage sold out in 2,000 stores in Ireland, UK, AU, NZ; acquired 1902 winery in Te Kauwhata in '16 COMPANY HIGHLIGHTS: Acquired by Sumitomo Corp in '14; invested $1.5m on new aseptic production and puree extraction lines in '15; expanding laboratory facilities in '17 COMPANY HIGHLIGHTS: Sold Australian business, Just Water Australia to Waterlogic in '15; acquired bottling plant for $3.3m in '16 * Estimate; Source: various companies annual financial statements (NZ Companies Office or company website); various press releases and news articles; Coriolis analysis CORIOLIS 87#88KARMA COLA KARMA Пор Chris Morrison Co-Founder DESCRIPTION: Manufacturer of Fairtrade organic craft sodas; sale proceeds go back to Sierra Leone cola growers; supply into hospitality and cafes; Karma Cola Pty Ltd (AU); Karma Cola UK (UK/EU); exports to Singapore, Macau, Hong Kong, Japan and Taiwan KEY PRODUCTS: Cola, lemonade, sparkling fruit flavoured waters; Karma Cola, Lemmy, Gingerella, All Good & Sparkling brands OWNERSHIP: NZ; Private (Morrison, Coley, Stewart, others) LION KIRIN LION Rory Glass Managing Director - BSW NZ DESCRIPTION: Lion is New Zealand's largest alcoholic beverage company; also manufactures other beverages and dairy products KEY PRODUCTS: Beer, wine, spirits, RTDs, cider, non alcoholic beverages, dairy OWNERSHIP: Japan; Public (Kirin (TYO: 2503)) MCCASHIN'S BREWERY M MECASHIN'S BREWERY MILLS REEF WINERY MILLS REEF WINERY Dean McCashin Acting General Manager DESCRIPTION: Beverages manufacturer based in Nelson; craft beer brewery, cider and non-alcoholic beverages; contract brewing and bottling; tours, restaurant and beer garden; contract brews for Moa Breweries; branch office in Taiwan, 4 staff; McCashin's Distilling Co; oak barrel operations KEY PRODUCTS: Beer, cider, water; Stoke, Rochdale, Palaeo brands OWNERSHIP: NZ; Private (McCashin) Nick Aleksich General Manager DESCRIPTION: Wine makers; winery and restaurant on 20 acres outside of Tauranga; five vineyards in Hawke's Bay KEY PRODUCTS: Wine OWNERSHIP: NZ; Private (Preston) COMPANY NUMBER: 4458783 ADDRESS: 72 Williamson Avenue, Auckland PHONE: +64 9 360 9691 WEBSITE: www.allgood organics.co.nz; www.karmacola.co.nz YEAR FORMED: 2008 STAFF EMPLOYED: 20 REVENUE: $5-10m ('16) COMPANY NUMBER: 33986/1035696 ADDRESS: 27 Napier Street, Freemans Bay, Auckland PHONE: +64 9 347 2000 WEBSITE: www.lionco.com; www.kirinholdings.co.jp COMPANY NUMBER: 2223762 ADDRESS: 660 Main Road, Stoke, Nelson PHONE: +64 3 547 5357 WEBSITE: www.mccashins.co.nz; www.rochdalecider.co.nz; www.stokebeer.co.nz YEAR FORMED: 2009 STAFF EMPLOYED: 30 REVENUE: $10-15m (FY16) COMPANY NUMBER: 17535 ADDRESS: 143 Moffat Road, Bethlehem, Tauranga PHONE: +64 7 576 8800 WEBSITE: www.millsreef.co.nz YEAR FORMED: 1989 STAFF EMPLOYED: 40 perm. 10 seasonal REVENUE: $12-15m (FY16) COMPANY HIGHLIGHTS: Global soft drink company selling fairtrade and organic carbonated beverages in New Zealand, Australia the UK & EU. Products manufactured in NZ & UK. Raised over US$100k for Karma Cola Foundation supporting cola nut growers in Sierra Leone. YEAR FORMED: 1860/1968/1977 STAFF EMPLOYED: 1,273 REVENUE: $561m Lion - BSW NZ (FY16) $29m Lion - Dairy and Drinks (FY16) COMPANY HIGHLIGHTS: Acquired Morton Estate ($6.8m) Jan '15; acquired Upper Hutt brewery Panhead Custom Ales Jul '16; Emerson's moving to new $25m brewery, tap-room and restaurant to increase production to 8m litres/year in '17; increased focus on mid, low and non-alcoholic options COMPANY HIGHLIGHTS: McCashin's Brewery Kitchen and Bar opened in '15; launched premium brand Palaeo Water, 14,000-30,000 year old water source, in '16; acquired Liquid Alchemy distilling business in Nov '16, incorporated into McCashin's Distilling Company, produces range of spirits incl. whiskey at brewery; acquired Nelson Cooperage, purchasing, reconditioning, selling oak barrels * Estimate; Source: various companies annual financial statements (NZ Companies Office or company website); various press releases and news articles; Coriolis analysis COMPANY HIGHLIGHTS: CORIOLIS 88#89MOUNT RILEY WINES NEW ZEALAND QUALITY WATERS NZQW New Zealand Quality Waters Lid MISSION ESTATE WINERY MISSION ESTATE WINERY MOA BREWING COMPANY MOA BREWING CO. MOUNT RILEY Peter Holley Chief Executive Officer DESCRIPTION: Wine makers; New Zealand's first winery; entertainment, restaurant, accommodation, tourism, cellar door; vineyards in Hawke's Bay and Marlborough KEY PRODUCTS: Wine OWNERSHIP: NZ; Private (Marist Holdings) COMPANY NUMBER: 960152 ADDRESS: 198 Church Road, Greenmeadows, Napier PHONE: +64 6 845 9350 WEBSITE: www.missionestate.co.nz Geoff Ross Chief Executive Officer DESCRIPTION: NZ's only listed craft beer brewer; based in Blenheim; exports to AU, Asia, Canada, USA; brewing in Blenheim and contract brewing at McCashins; planning stages for new brewery KEY PRODUCTS: Craft beer, cider OWNERSHIP: NZ; Public (NZX: MOA); (Pioneer Capital (PE) 25%, The Business Bakery 23%, Alan Scott Wines 7%, others) COMPANY NUMBER: 1528394 ADDRESS: 258 Jacksons Road, Blenheim PHONE: +64 3 572 5146 WEBSITE: www.moabeer.com John Buchanan Managing Director DESCRIPTION: Winery based in Blenheim; Mount Riley, Feather, Savee, Seventeen Valley brands; seven vineyards in Marlborough; export to Australia, Asia, Canada, UK; airlines and cruise lines KEY PRODUCTS: Wine OWNERSHIP: NZ; Private (Buchanan, Murphy) Bruce Sherman General Manager DESCRIPTION: Producers and exporters of premium spring water based beverages; water source is Blue Spring in Putaruru plus artesian water; bottling plant at source: contract bottling service; offices in Australia, Thailand, Hong Kong KEY PRODUCTS: Still, lightly flavoured spring water beverages; NZO Volcanic Spring Water, WAIZ brands OWNERSHIP: Hong Kong; Private (NZO International 51%); Singapore; Private (Wee 49%) COMPANY NUMBER: 869998 ADDRESS: 10 Malthouse Road, Riverlands, Marlborough PHONE: +64 3 577 9900 COMPANY NUMBER: 1886777 ADDRESS: 83 Domain Road, Putaruru PHONE: +64 7 883 8499 WEBSITE: www.nzqw.co.nz WEBSITE: www.mountriley.co.nz YEAR FORMED: 1851 YEAR FORMED: 2003 STAFF EMPLOYED: 80 (inc. restaurant) STAFF EMPLOYED: 19 REVENUE: $10-15m (FY16) REVENUE: $8m (FY16) COMPANY HIGHLIGHTS: COMPANY HIGHLIGHTS: 43% growth in volume sold in '16, 2.5m litres; distribution agreement with Parrot Dog Brewing for Moa to distribute in NZ; institutional placement share offer in '16 for PIE Funds Management to acquire 6.6% interest, $4m in total new equity YEAR FORMED: 1997 STAFF EMPLOYED: 20 REVENUE: $15-20m* COMPANY HIGHLIGHTS: * Estimate; Source: various companies annual financial statements (NZ Companies Office or company website); various press releases and news articles; Coriolis analysis YEAR FORMED: 2006 STAFF EMPLOYED: 21 REVENUE: $6-8m (FY16) COMPANY HIGHLIGHTS: Brand refresh and new packaging in '16; planned expansion of exports to Australia and Singapore; website updated in '17; currently undergoing significant plant re- organisation with expected complete Jun '17 CORIOLIS 89#90PEGASUS BAY LIMITED PEGASUS BAY FINE WAIPARA WINE PERNOD RICARD WINEMAKERS-NZ Pernod Ricard Winemakers SACRED HILL VINEYARDS SACRED HILE SAINT CLAIR ESTATES WINES 0 SAINT CLAIR FAMILY ESTATE Paul Donaldson General Manager DESCRIPTION: Winery and restaurant in Waipara Valley, Canterbury; Pegasus Bay, Main Divide brands KEY PRODUCTS: Wine Jo-Anna Partridge Operations Director DESCRIPTION: Grower and maker of wines; Church Road, Deutz, Brancott Estate, Stoneleigh; Brancott Estate is #1 wine brand in NZ; NZ operations divided into NZ sales & marketing of global portfolio of wine & spirits, and winemaking operation; overarching Management Committee based in AU KEY PRODUCTS: Wine, sparkling wine JEBSEN David Mason Managing Director DESCRIPTION: Five wine brands: Sacred Hill, Gunn Estate, Ti Point, Wild South, White Cliff; 50% interest in Gimblett Gravels Vineyard Ltd KEY PRODUCTS: Wine Neal Ibbotson Managing Director DESCRIPTION: Wine maker based in Marlborough; 6 vineyards throughout Marlborough; Saint Clair Reserve, Pioneer Block, Premium, Vicars Choice brands; restaurant and cellar door; exports to ~70 world markets KEY PRODUCTS: Wine OWNERSHIP: NZ; Private (Donaldson) OWNERSHIP: France; Public (Pernod Ricard SA (Euronext:RI)) via Millstream Finance Ltd OWNERSHIP: NZ; Private (Mason family 65%); HK; Private (Jebsen Beverage Co 30%) OWNERSHIP: NZ; Private (Ibbotson) COMPANY NUMBER: 977770 ADDRESS: Stockgrove Road, Waipara, Amberley PHONE: +64 3 314 6869 WEBSITE: www.pegasusbay.com COMPANY NUMBER: 86020 ADDRESS: 4 Graham Street, Auckland PHONE: +64 9 336 8300 WEBSITE: www.pernod-ricard-winemakers.com STAFF EMPLOYED: 430 YEAR FORMED: 1985 STAFF EMPLOYED: 70 REVENUE: $12-15m* YEAR FORMED: 1961 COMPANY NUMBER: 961615 ADDRESS: 1472 Omahu Road, RD5, Hastings PHONE: +64 6 879 8760 WEBSITE: www.sacredhill.com; www.jebsen.com; www.quenchcollective.co.nz YEAR FORMED: 1986 STAFF EMPLOYED: 35 REVENUE: $43m (FY16) COMPANY NUMBER: 1017340 ADDRESS: 30-32 Liverpool Street, Riverlands Estate, Blenheim PHONE: +64 3 578 8695 WEBSITE: www.saintclair.co.nz YEAR FORMED: 1994 STAFF EMPLOYED: 60 REVENUE: $45-$55m (FY14) COMPANY HIGHLIGHTS: REVENUE: $241m (FY16) (Pernod Ricard Winemakers NZ) COMPANY HIGHLIGHTS: 2.2m cases of Brancott Estate sold worldwide in '16; # 1 NZ Sauvignon Blanc in the UK by volume COMPANY HIGHLIGHTS: Focus on exporting to USA in '16; rebranded Sacred Hill Wine Company, set up in '12 to manage domestic sales and distribution of portfolio of wine, beer and cider, to Quench Collective in '16; launched two new Marlborough wines in '16, high demand in US COMPANY HIGHLIGHTS: NZ Producer of the Year in '16 highlighting a run of success in international wine shows in recent years; purchased Lake Chalice vineyard and brand in '16; 5 gold awards at the Royal Easter Show Wine Awards in '17 * Estimate; Source: various companies annual financial statements (NZ Companies Office or company website); various press releases and news articles; Coriolis analysis CORIOLIS 90#91SEIFRIED ESTATE Seifried Hermann Seifried Director DESCRIPTION: Winery and restaurant; Aotea, Old Coach Road, Rabbit Island, Seifried, Winemakers Collection brands; 250ha across 9 vineyards; exports 65% to over 20 countries KEY PRODUCTS: Wine SILENI ESTATES LIMITED SILENI ESTATES Nigel Avery Chief Executive Officer DESCRIPTION: Wine producer and exporter; based in Hawkes Bay with vineyards in Marlborough; 800ha, 250ha of contract grape growers; produces 760,000 cases, one of the fastest growing wineries in NZ; in top 10 by production volume; exports to over 80 markets KEY PRODUCTS: Wine SOLJANS ESTATE WINERY SOLJANS ESTATE WINERY Tony Soljan Managing Director DESCRIPTION: Winery, café and functions; based in Auckland; exports to Canada, China, Japan, Pacific, Poland, USA, Malaysia, Taiwan KEY PRODUCTS: Wine THE BETTER DRINK CO LTD The BETTER DRINKSC Asahi BEVERAGES George Gordon General Manager DESCRIPTION: Manufacturer, marketer and distributor of beverages; Charlies, Phoenix, Juicy Lucy, Ti Tonics, Real Iced Tea, Stash Tea brands; production sites in NZ and AU; distribution rights for Sunkist products in NZ, Pacific Islands; exports to over 12 countries KEY PRODUCTS: Juice, iced tea, soft drinks, tea OWNERSHIP: NZ; Private (Seifried) OWNERSHIP: NZ; Private (Avery, Porter, Puvera Pty (AU) 6%, Edmonds) OWNERSHIP: NZ; Private (Soljan) OWNERSHIP: Japan; Private (Asahi Group) via Asahi Holdings (AU) COMPANY NUMBER: 918475 ADDRESS: 184 Redwood Road, Appleby, Nelson PHONE: +64 3 544 5599 WEBSITE: www.seifried.co.nz YEAR FORMED: 1973 STAFF EMPLOYED: 50 perm. 20 seasonal REVENUE: $20-30m* COMPANY NUMBER: 882582 ADDRESS: 2016 Maraekakaho Road, Hastings PHONE: +64 6 879 8768 WEBSITE: www.sileni.co.nz YEAR FORMED: 1997 STAFF EMPLOYED: 40 REVENUE: $50-60m (FY16) COMPANY NUMBER: 658205 ADDRESS: 366 State Highway 16, Kumeu, Auckland PHONE: +64 9 412 5858 WEBSITE: www.soljans.co.nz YEAR FORMED: 1937 STAFF EMPLOYED: 50 REVENUE: $10m (FY16) COMPANY NUMBER: 969423 ADDRESS: Suite 101, 1 Cleveland Road, Parnell, Auckland PHONE: +64 9 837 6740 WEBSITE: www.betterdrinks.co.nz; www.asahi.com.au; www.phoenixorganics.co.nz YEAR FORMED: 1999 STAFF EMPLOYED: 100 REVENUE: $31m (FY15) COMPANY HIGHLIGHTS: COMPANY HIGHLIGHTS: COMPANY HIGHLIGHTS: * Estimate; Source: various companies annual financial statements (NZ Companies Office or company website); various press releases and news articles; Coriolis analysis COMPANY HIGHLIGHTS: "Alliance" with Ti Tonics giving exclusive distribution rights announced in '15; CEO left in May '16 CORIOLIS 91#92THE HOMEGROWN JUICE COMPANY THE WINE PORTFOLIO TREASURY WINE ESTATES (MATUA) LTD VILLA MARIA ESTATE LTD Homegrown Stephen Brownlie Director DESCRIPTION: Manufacturer of raw cold pasteurised (HPP) juices; largest plantings of orange orchards in NZ, located in Gisborne and Hawkes Bay; retail and food service; Homegrown and Grove brands KEY PRODUCTS: Orange, apple, grapefruit, lemon, lime, apple and kale juices, fruit and vegetable blend juices, berry, fruit, feijoa and apple smoothies OWNERSHIP: NZ; Private (Brownlie) THE WINE PORTFOLIO John Coney Owner DESCRIPTION: Winery operations; 5 vineyards in Hawkes Bay and 1 in Marlborough; 13 brands, Cathedral Cove, Mill Road, Nikau Point, Southern Cross, Penny Lane, Mimi, Southern Dawn, Leveret Estate, Falconhead, Coniglio, IQ, The Regent, Mansfield & Mars; exports to China, UK, AU KEY PRODUCTS: Wine MATUA TREASURY WINE ESTATES Angus McPherson Managing Director AU & NZ DESCRIPTION: Wine maker and grower; Matua, Secret Stone, Angel Cove, Squealing Pig brands; 8 vineyards, 339ha planted; 1 winery; 85% of grapes sourced through grower contracts KEY PRODUCTS: Wine VILLA MARIA NEW ZEALAND Sir George Fistonich Founder & Owner DESCRIPTION: Wine maker and grower; Villa Maria, Vidal Estate, Thornbury, Esk Valley, Te Awa Single Estate, Left Field, Kidnapper Cliffs; exports to over 60 countries; Vineyard Plants Nursery KEY PRODUCTS: Wine OWNERSHIP: Canada; Private (Coney) OWNERSHIP: AU; Public (ASX:TWE); (JP Morgan Nominees AU 28%, HSBC Custody Nominees 27%) OWNERSHIP: NZ; Private (Fistonich) COMPANY NUMBER: 4387684 ADDRESS: 407 Williams Street, Mahora, Hastings PHONE: +64 6 878 8140 WEBSITE: www.homegrownjuice.co.nz COMPANY NUMBER: 668538 ADDRESS: 2389 State Highway 2, Katikati PHONE: +64 7 552 0795 WEBSITE: www.wineportfolio.co.nz COMPANY NUMBER: 266340 ADDRESS: 130 St Georges Road, Parnell, Auckland PHONE: +64 9 354 5250 WEBSITE: www.tweglobal.com; www.matua.co.nz YEAR FORMED: 2013 STAFF EMPLOYED: N/A REVENUE: $20-30m* YEAR FORMED: 1995 STAFF EMPLOYED: 50 perm. 30 seasonal REVENUE: $30-40m ('16) YEAR FORMED: 1969/1985 STAFF EMPLOYED: 150 REVENUE: $249m (FY16) COMPANY NUMBER: 291073 ADDRESS: 118 Montgomerie Road, Mangere, Auckland PHONE: +64 9 255 0660 WEBSITE: www.villamaria.co.nz; www.vidal.co.nz www.teawacollection.com; www.eskvalley.co.nz YEAR FORMED: 1961 STAFF EMPLOYED: 300 REVENUE: $160-180m* COMPANY HIGHLIGHTS: COMPANY HIGHLIGHTS: Sold Morton Estate brand and Marlborough vineyard to Lion for $6,775m in '15; developed two new brands, Leveret and Falconhead in '14 COMPANY HIGHLIGHTS: Closed Auckland winery and moved all production to expanded Marlborough facility, loss of 50 jobs in Mar '16; closed Matua packaging plant and cellar door in Waimauku; sold Matua Auckland Winery to Sutton Group Holdings in July '16, $4.3m * Estimate; Source: various companies annual financial statements (NZ Companies Office or company website); various press releases and news articles; Coriolis analysis COMPANY HIGHLIGHTS: Acquired 41ha of neighbour Pask Winery in Gimblett Gravels in '14; Villa Maria's Sauvignon Blanc on North America Starbucks' evening menu since April '15; launched icon wine, Cabernet Sauvignon, RRP $150 in '16; launch of lighter rose, winner of NZ Food Awards, Beverages category in '16; part of MPI PGP programme; NZ Winery of Year '16; highly awarded CORIOLIS 92#93WAIWERA WATER LIMITED WAIWERA ARTESIAN WATER EST. 1875 WINEWORKS LIMITED ☑ WINEWORKS Avi Jayapuram General Manager DESCRIPTION: Bottled water producer and distributor; exports to over 10 countries; co-owned Waiwera Organic Winery spirit maker, Waiwera Thermal Resort; exports to United Arab Emirates, USA KEY PRODUCTS: Bottled still and sparkling water; glass and PET OWNERSHIP: NZ; Private (Khimich 80%); USA; (Ordover Trust 20%) Tim Nowell-Usticke Managing Director DESCRIPTION: Wine bottling, warehousing, transport, distribution service provider; 9 bottling lines at sites in Marlborough, Hawke's Bay, Auckland; 60,000 cases/day capacity; 60m bottles in warehouses; bottles 40% of NZ's wine KEY PRODUCTS: Bulk wine transport, laboratory services, bottling, packaging, warehousing and distribution, certification, freight OWNERSHIP: NZ; Private (Nowell-Usticke 60%, Vintage Investments 40%) YEALANDS WINE GROUP Yealands -FAMILY WINES - MARLBOROUGH AND Marlborough Lines Adrian Garforth MW Chief Executive Officer DESCRIPTION: Vineyard and wine maker; vineyard holdings in Marlborough and Hawke's Bay; Yealand Family Wines, Crossroads, The Crossing, Babydoll, Southbank Estate, Silver Fern Wines, Flaxbourne, Clearwater Cove brands KEY PRODUCTS: Wine OWNERSHIP: NZ; Private (Marlborough Lines Ltd 85%, Yealand 15%) COMPANY NUMBER: 3401174 ADDRESS: 21 Waiwera Road, Waiwera, Auckland PHONE: +64 9 448 2483 WEBSITE: www.waiwera.com; www.waiwera.me COMPANY NUMBER: 3324832 ADDRESS: 26 Liverpool Street, Riverlands, Blenheim PHONE: +64 3 577 8166 WEBSITE: www.wineworks.co.nz COMPANY NUMBER: 5737427 ADDRESS: 139 Quay Street, Princes Wharf, Auckland PHONE: +64 9 920 2880 WEBSITE: www.yealandswinegroup.co.nz YEAR FORMED: 1875 STAFF EMPLOYED: 23 REVENUE: $5-10m* COMPANY HIGHLIGHTS: YEAR FORMED: 1995 STAFF EMPLOYED: 368 REVENUE: N/A COMPANY HIGHLIGHTS: Opened multi-million dollar facility in Onehunga, Auckland in '16 YEAR FORMED: 2006 STAFF EMPLOYED: 180 REVENUE: $100m (FY14) COMPANY HIGHLIGHTS: Peter Yealand sold 80% of business to Marlborough Lines Company July '15 for $89m; acquired 261ha Straight Views farm for $4.35m in '16, plans to convert to 70ha vineyard with first grapes by '20; Hawke's Bay Crossroads vineyard and winery put on market in '16; new CEO in '17 * Estimate; Source: various companies annual financial statements (NZ Companies Office or company website); various press releases and news articles; Coriolis analysis CORIOLIS 93#94Appendices + Industry bodies + Trade codes + Glossary of terms 06#95INDUSTRY ORGANISATIONS New Zealand has a broad range of organisations which support the alcoholic and non-alcoholic beverage industries FG:C NEW ZEALAND FOOD&GROCERY COUNCIL NEW ZEALAND WINE PURC DISCOVERY SPIRITS NZBC BREWERS GUILD OF NEW ZEALAND NZ BEVERAGE COUNCIL B BREWERS ASSOCIATION Brewers Association of Australia & New Zealand Inc Represents the manufacturers and suppliers behind New Zealand's food, beverage and grocery brands www.fgc.org.nz Represent 850 growers and 700 wineries Funded through: a levy on the sale of grapes collected by the Grape Growers Council under the Commodity Levies Act 1991 Levy on the sale of wine collected by the Wine Institute under the Wine Act 2003 www.nzwine.com Represent leading producers, distributors, brand owners, importers and exporters of premium spirits and liqueurs (98% of industry) Represent producers and marketers of beverages, juices, water and non- alcoholic beverages Represents brewing industry in New Zealand Over 163 brewers Funded via members fees Representing the major brewing producers in Australia and New Zealand Four major brewers in NZ and AU; Carlton, Coopers, DB, Lion (95% market) www.spiritsnz.org.nz www.nzbc.nz www.brewersguild.org.nz www.brewers.org.au CORIOLIS 95#96TRADE CODES GLOBAL HARMONISED SYSTEM (HS) TRADE CODES DEFINED AS BEVERAGES HS2002 HS Short Description Code 200911 Frozen orange juice 200912 Orange juice not-frozen unsweet 200919 Orange juice not-frozen sweet 200921 Grapefruit juice. 200929 Grapefruit juice 200931 Other citrus 200939 Other citrus 200941 Pineapple juice 200949 Pineapple juice 200950 Tomato juice 200961 Grape juice 200969 Grape juice 200971 Apple juice, unsweetened 200979 Apple juice 200980 Kiwifruit juice; other fruit juices 200990 Mixed juice 220110 Mineral water 220190 Other water, unsweetened 220210 Soft drinks 220290 Other flavoured beverages 220300 Beer 220410 Sparkling wine 220421 Wine, bottle 220429 Wine, bulk 220430 Grape must 220510 Vermouth 220590 Vermouth 220600 Cider; other fermented 220710 Ethyl alcohol 80% 220720 Ethyl alcohol any strength 220820 Distilled grape wine 220830 Whiskeys 220840 Rum 220850 Gin 220860 Vodka 220870 Liqueurs 220890 Other spirits 220900 Vinegar Longer official description Frozen orange juice, unfermented, not containing spirit Orange juice, not frozen, of a Brix value not >20, unfermented & not cont. added spirit, whether or not cont. added sugar/oth. sweetening matter Unfrozen orange juice, unfermented, not containing added spirit Grapefruit juice, of a Brix value not >20, unfermented & not cont. added spirit, whether or not cont. added sugar/oth. sweetening matter Grapefruit juice (excl. of 2009.21), unfermented & not cont. added spirit, whether or not cont. added sugar/oth. sweetening matter Juice of any single citrus fruit other than orange/grapefruit, of a Brix value not >20, unfermented & not cont. added spirit, whether or not cont. added sugar/oth. sweetener Juice of any single citrus fruit other than orange/grapefruit (excl. of 2009.31), unfermented & not cont. added spirit, whether or not cont. added sugar/oth. sweetener Pineapple juice, of a Brix value not >20, unfermented & not cont. added spirit, whether or not cont. added sugar/oth. sweetening matter Pineapple juice (excl. of 2009.41), unfermented & not cont. added spirit, whether or not cont. added sugar/oth. sweetening matter Tomato juice, unfermented, not containing added spirit Grape juice, incl. grape must, of a Brix value not >30, unfermented & not cont. added spirit, whether or not cont. added sugar/oth. sweetening matter Grape juice, incl. grape must (excl. of 2009.61), unfermented & not cont. added spirit, whether or not cont. added sugar/oth. sweetening matter Apple juice, of a Brix value not >20, unfermented & not cont. added spirit, whether or not cont. added sugar/oth. sweetening matter Apple juice (excl. of 2009.71), unfermented & not cont. added spirit, whether or not cont. added sugar/oth. sweetening matter Juice of other single fruit, unfermented, not containing added spirit Mixtures of juices, unfermented, not containing added spirit Mineral waters and aerated waters, unsweetened Other unsweetened waters; ice and snow Waters (incl. mineral and aerated), with added sugar Other non-alcoholic beverages, nes Beer made from malt Champagne and sparkling wine Wine (not sparkling); grape must with by alcohol holding 2L or less Wine (not sparkling); grape must with alcohol holding <10L Other grape must, nes Vermouth and other wine of fresh grapes, flavours Vermouth and other wine of fresh grapes, flavours Other fermented beverages (for example, cider) Undenatured ethyl alcohol, of alcoholic strength of 80% Ethyl alcohol and other denatured spirits of any strength Spirits from distilled grape wine or marc Whiskeys Rum and tafia Gin and Geneva Vodka Liqueurs and cordials Other spirituous beverages, nes Vinegar and substitutes for vinegar CORIOLIS 96#97GLOSSARY OF TERMS A$/AUD Australian dollar n/a ABS Absolute change ANZSIC AU/NZ Standard Industry Classification NA/ME/CA N. America Not available/not applicable North Africa Middle East / Central Asia North America (USA, Canada) AU Australia Nec/nes Not elsewhere classified/not elsewhere specified Australasia Australia and New Zealand N/C Not calculable b Billion N.H Northern Hemisphere CAGR Compound Annual Growth Rate NZ New Zealand CN China NZ$/NZD New Zealand dollar C/S America Central & South America (Latin America) R&D Research and Development CRI Crown Research Institute S Asia South Asia (Indian Subcontinent) CY Calendar year (ending Dec 21) SE Asia South East Asia E Asia East Asia S.H Southern Hemisphere EBITDA Earnings before interest, tax, depreciation and amortization SS Africa Sub-Saharan Africa FAO Food and Agriculture Organisation of the United Nations T/O Turnover FOB Free on Board UHT Ultra-high temperature FY Financial year (of firm in question) US/USA United States of America GBP British pounds US$/USD United States dollar HK Hong Kong UK United Kingdom IQF Individually quick frozen YE Year ending JV Joint venture YTD Year to date m Million CORIOLIS 97#98AUSTRALIA Coriolis Australia Pty Ltd PO Box 5831 St Georges Terrace Perth, WA 6831 Australia +61 8 9468 4691 NEW ZEALAND Coriolis (New Zealand) Limited PO Box 90-509 Victoria Street West Auckland, 1142 New Zealand +64 9 623 1848 www.coriolisresearch.com Coriolis is the leading Australasian management consulting firm specialising in the wider food value chain. We work on projects in agriculture, food and beverages, consumer packaged goods, retailing & foodservice. In other words, things you put in your mouth and places that sell them. WHERE WE WORK We focus on the Asia Pacific region, but look at problems with a global point-of-view. We have strong understanding of, and experience in, markets and systems in Australia, China, Japan, Malaysia, New Zealand, Singapore, South Korea, Thailand, the United Kingdom and the U.S. WHAT WE DO We help our clients assemble the facts needed to guide their big decisions. We develop practical, fact-based insights grounded in the real world that guide our clients decisions and actions. We make practical recommendations. We work with clients to make change happen. We assume leadership positions to implement change as necessary. HOW WE DO IT All of our team have worked across one-or-more parts of the wider food value chain, from farm-to-plate. As a result, our work is grounded in the real world. Our style is practical and down-to- earth. We try to put ourselves in our clients' shoes and focus on actions. We listen hard, but we are suspicious of the consensus. We provide an external, objective perspective. WHO WE WORK WITH We only work with a select group of clients we trust. We build long term relationships with our clients and more than 80% of our work comes from existing clients. Our clients trust our experience, advice and integrity. Coriolis advises clients on growth strategy, mergers and acquisitions, operational improvement and organisational change. Typical assignments for clients include... FIRM STRATEGY & OPERATIONS We help clients develop their own strategy for growing sales and profits. We have a strong bias towards growth driven by new products, new channels and new markets. MARKET ENTRY We help clients identify which countries are the most attractive - from a consumer, competition and channel point-of-view. Following this we assist in market entry planning & growth. VALUE CREATION We help clients create value through revenue growth and cost reduction. TARGET IDENTIFICATION We help clients identify high potential acquisition targets by profiling industries, screening companies and devising a plan to approach targets. DUE DILIGENCE We help organisations make better decisions by performing consumer and market-focused due diligence and assessing performance improvement opportunities. EXPERT WITNESS We provide expert witness support to clients in legal cases and insurance claims. We assist with applications under competition/fair trade laws and regulations. 98