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Company Profile
GLG Life Tech Corporation January 2012
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Forward-Looking Statements
3
Contents
Company Background
Stevia Ingredient Business
2012 – Year of GLG Opportunities
AN0C Consumer Products Business
Company Financials
4
Company Background
5
GLG Life Tech Corporation
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Complete Seed to Shelf Vertical Integration
Patented Seeds - ease and lower cost in scaling agriculture vs seedling approach, and consistency in taste
Leaf Cultivation - 200,000 farmers contracted across 10 major growing regions in China
Advanced Manufacturing Know-how - patented process and separation methodologies and advanced extraction technology
Innovative Products – comprehensive product line-up including high-purity extracts, turn-key solutions and pre-mix formulations
AN0C Consumer Products – All-natural zero-calorie food and beverage products. Initial products to launch across 6 major beverage categories, plus functional drinks and tabletop sweeteners.
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Stevia Ingredient Business
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At the Leading Edge of Innovation
Already granted or submitted patent applications for:
Huinong One (H1)
60% Reb A content in plant leaf
Huinong Two (H2)
66% Reb A content in plant leaf
22% more leaf per acre (vs H1)
Huinong Three (H3)
76% Reb A content in plant leaf
46% more leaf per acre (vs H1)
Advancing stevia through natural propagation
Seeds & Leafs Patents
Key Product Innovation
RebPureTM (RA) PureSTVTM (STV) Reb C
Process Technology Patents
Already granted or submitted patent applications for: Reb A extraction Reb B separation methodology Reb C separation methodology Reb D separation methodology Steviolbioside separation methodology Process for producing a natural sweetener
composition (BlendSureTM) Production of high-volume, high-purity
STV Environmentally-friendly waste water
treatment Leaf processing extraction device
AN0CTM Dream Sweetener Line BlendSureTM (RA + STV)
GLG has received 4 Letters of No Objection from the FDA on core finished products.
4 key PCT filed in 2010/2011 to further protect GLG intellectual property rights internationally.
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Huinong Series of Non-GMO Patented Seeds
Huinong 3 (H3)
76% rebaudioside A content in the leaf, a 26% increase from the H1 strain
46% more leaf per acre than H1 strain
Available for planting in 2012 growing season
Huinong 4 (H4)
76% rebaudioside A content in the leaf
16% more leaf per acre than H3
Available for planting in 2012 growing season
To play role of parents in the advancement of next generation of seeds
High Reb-A Content High STV Content
Huinong 5 (H5)
70% stevioside content in the leaf
Leaf yield between H2 and H3 strains (between 22% to 46% more leaf per acre than H1 strain)
Believed to be the highest STV seed available in the world today
To help reduce production costs of GLG’s Blendsure™ line of products
Naturally bred for high Reb-A and STV content
GLG Patented High RA Leaf
GLG Patented High STV Leaf Other Stevia Strains on the Market
22.9% 24.2% 28.2%35.7%
61.8%68.0%
76.0% 76.0%70.0%
0%
20%
40%
60%
80%
2009 India Leaf 2009 China
Common Leaf
2009 Paraguay
Leaf
2009 Canada
Leaf
2009 Huinong 1 Huinong 2 Huinong 3 Huinong 4 Huinong 5
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Our Competitive Advantage: Secure Leaf Supply
10% higher rebaudioside A content than the previous generation (H1).
the H2 strain also generates 22% more leaf per acre. GLG has upgraded its varieties company wide and has
utilized Huinong 2 at all 10 of the Company’s growing bases in China for the 2011 crop season.
20% greater processing efficiencies expected 100% of crop expected for harvest in 2011 has been
planted using Huinong 2 seeds.
GLG holds 10- and 20-year agreements in multiple provinces for exclusive and protected stevia growing areas
Growth and supply of 100% own leaf needs using GLG proprietary plant variety – no dependence on common market leaf
Agricultural expansion continues and planting now spans across 10 growing areas
Shandong
Jiangsu
Anhui
Huinong 2 Patented Seeds
76% rebaudioside A content in the leaf, a 26% increase from the H1 strain
estimated 600kg of additional stevia leaf harvested per acre, a 46% increase over H1, which improves land and resource utilization
estimated 40% overall leaf cost improvement expected as a direct result of the increased RA content and increased leaf yield
Greater processing efficiencies expected On track for use in 2012/13
Huinong 3 Patented Seeds
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Our Competitive Advantage: Technology
Patented high-purity stevia extraction (China and International PCT)
Capable of producing all stevia extracts with purity levels up to 99% (RA, STV, RC, etc)
Low cost production
Extraction and Refining
GLG Qingdao Facilities
Annual leaf processing capacity is currently 41,000 metric tonnes. Currently, our Runhai campus has 60 acres and Runyang campus is 80 acres .
Currently our refining and purification facilities have a capacity of 3,000 metric tonnes. Phase I of our Runhao campus occupies 60 acres but is scalable to 215 acres, and our Runde campus currently occupies 70 acres.
All sites are fully third-party (SGS) certified for GMP, ISO, HACCP, HALAL, and Kosher
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Our Competitive Advantage: Capacity
Current Leaf Processing Capacity
Runde Runhao
1,000
2,000
200,000 farmers contracted across 10 major growing regions in China
Primary Processing
Secondary Processing
Leaf Growing
41,000 MT
MT
MT
Intermediate Products,
such as RA60
High-grade Extracts, such as
BlendSure, PureSTV and
RebPure
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Quality control and food safety is our top priority
All facilities meet and exceed global GMP standards
Major multinational agricultural, food and beverage companies conduct regular audits, including Cargill, Nestle, Pepsico, and others
Facilities are certified on scheduled basis for:
ISO9001:2008
Halal
Kosher
SGS, the world’s largest control and inspections authority
Our Trust Providers
“stevioside”
“rebaudioside A”
“RebpureTM”
“PureSTVTM”
“steviol glycosides with rebaudioside A
and stevioside”
“BlendSureTM”
“rebaudioside A” “RebpureTM”
4 FDA Letters of No Objection / GRAS
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Our Facilities
Shandong
Jiangsu
Anhui
Runhao Qingdao, Shandong Purification/Refining
Runde Qingdao, Shandong Purification/Refining
Runyang Dongtai, Jiangsu Primary Extraction
Runhai Mingguang, Anhui Primary Extraction
Bengbu Bengbu, Anhui Plant Research Centre
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Our Facilities
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GLG’s Stevia Extract Products
Steviol Glycoside Content
Reb A +STV Blend Available in
50%-80% Reb A content
Available in ≥95 and ≥ 97% Reb A content
Available in ≥95 and ≥ 97%
STV content
80% Reb A content
30% - 60% Reb A content
Sweetness Factor vs Sucrose *
250x 300x 250x 250x 250x
Heat and pH Stable Yes Yes Yes Yes Yes
Total Steviol Glycosides (TSG)
≥ 97% ≥ 97% ≥ 97% ≥ 95% ≥ 95%
Available Form
Industrial ingredient or formulated
Industrial ingredient or formulated
Industrial ingredient or formulated
Industrial ingredient or formulated
Industrial ingredient or formulated
GRAS / FDA Letter of No Objection
Yes Yes (2) Yes No No
* approximately
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2011 – The Year of Industry Challenges 2012 – The Year of GLG Opportunities
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General Competitive Conditions in the Global Stevia Industry
Main challenge has been the difficulties that food and beverage companies are experiencing in formulating with stevia to develop a good tasting product
Different levels of players entered the industry: Vertically integrated, Partially integrated (primary or secondary processing only), and Distributors/Brokers
Management’s assessment is stevia supply > demand in 2011
As a result, pricing is very competitive on large volume opportunities
Current
European Commission recently approved the use of steviol glycosides as a sweetener in the European market
New markets expected to open up soon (India)
US consumer products sweetened with stevia continue to expand. According to a August 2011 Mintel study, stevia products in the US is expected to reach nearly $1.2 billion in 2013, up from $439 million in 2010.
According to Datamonitor, for the 12 months to September 2011, more than 300 stevia-sweetened products launched in the US and 630 globally
Going Forward
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GLG’s Leadership Position in the Industry
AN0C Stevia Solutions addresses the key issue of formulation challenges experienced by food and beverage companies with stevia
AN0C Stevia Solutions has launched key innovative products to provide complete solutions (Dream Sweetener, Pre-Mixes)
GLG’s long term strategy in agriculture is now paying off with the first successful harvest of our H2 leaf and H3 leaf this year. In 2012, GLG moves to a significantly lower cost structure with its patented H2 and H3 leaf, and will be well-positioned to drive industry pricing
GLG’s new international stevia business sales team established in Vancouver, replacing the US-based sales team which did not perform to expectations in 2011. The new sales and marketing team will drive international sales and support distribution partners in the US, Mexico, South America, Europe, Middle East and India. GLG has doubled the number of their distributors and have added sales agents in some key markets to drive sales.
Low-Calorie Healthy Sugar opportunity in China expected to expand in 2012
GLG is positioned to benefit from the industry’s explosive growth anticipated in 2012
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AN0C Stevia Solutions has solved many of the traditional problems associated with formulating with stevia.
Provides technical help on stevia or actual food and beverage formulations to develop zero or low calorie naturally sweetened food and beverage products
Leverages GLG and AN0C’s know-how in creating different types of BlendSureTM to develop the best taste
AN0C Stevia Solutions Providing Formulation Solutions to International Customers
Providing Turnkey Solutions to Partners Worldwide
Stevia Solutions team to drive sales with global customers
AN0C Stevia
Solutions
AN0C Food & Beverage
Formulation Expertise
GLG Stevia Separation/
Extraction Technical Know-how
Formation of AN0C Stevia Solutions
Combining stevia technical know-how
with formulation expertise
Launch of first product “Dream
Sweetener”
Turn-key formulations for zero or low-calorie
products
Sent out samples of Dream Sweetener and AN0C products to F&B companies in US, EU, Mexico, and South America
Demonstrated aftertaste problem solved
Direct F&B company visits
Further product sampling, price
quotes and business discussions
July August September /October
August/ September
Projects and product trials
Product formulation & taste discussions,
and product prototypes submitted
Current
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Tastes like cane sugar, is zero-calorie and has no aftertaste
Provides a consistent sweetness for much easier formulation for a food and beverage company
Easy to handle, unlike typical high-purity stevia extracts which come in a light powder form
Can reduce the time-to-market for food and beverage companies since the major formulation challenges (aftertaste & consistency of taste from batch to batch) with high-purity stevia extracts have been addressed through our innovative formulations
Compares favorably to the cost of cane sugar and is more cost efficient at large volumes
Dream Sweetener™ Advantages
AN0C Dream
Sweetener™ Series *
x10, x30, x60, x100 An all-natural zero-calorie
sweetener available in varying
levels of sweetness
Proprietary blend of natural sweeteners (all FDA GRAS certified)
RA STV
(FDA GRAS certified)
* patent application filed with SIPO in China, with PCT application for International patent protection to follow
The Dream Sweetener™ Product Line
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AN0C Low-Calorie Health Sugar
Advantages
Low-calorie
Tastes like sugar
Easy to directly replace sugar or any other artificial sweetener
Formulating food products much easier
Reduced calorie solution to 1/3 of cane sugar ideal for use in food and beverage products
Benefits
Relieve sugar shortage issue
Ability to bring low-calorie products to the market quickly
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Dream Sweetener Closely Replicates Sugar Taste Profile
AN0C can help make formulating your beverage and food products much easier.
A Comparison of AN0C Dream Sweetener to Sugar
Source:
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How Our Products Fulfill Customer Needs
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AN0C Pre-mixes Our simple to use and fast-to-market pre-mixes contain either a low-calorie or zero-calorie stevia sweetener and a flavour pack that can be easily added to any beverage or food products.
Advantages
Lower or zero calorie Easy to handle and use Turn-key solution for fast-to-market opportunities (complete ready-to-use recipe)
Zero-calorie green tea – AN0C Stevia Solutions will send two packages
AN0C Dream Sweetener
AN0C Green Tea flavour package
Beverage companies just add water and bottle for their own branded product
Low-calorie carbonated cola soft drink – AN0C Stevia Solutions will send two packages
AN0C Low-Calorie Health Sugar
AN0C flavour package for a cola beverage
Beverage companies just add water and carbonate, then bottle for their own branded product
Examples of Pre-mix Solutions Examples of Pre-mix Applications
Customized turn-key solutions, like pre-mix packages that contain a low or zero-calorie sweetener and a flavour package, can be used in a wide variety of beverage and food products:
Foods
Dairy (yogurt, ice cream)
Baked (cookies, biscuits, breads, cakes)
Dressings (salad, condiments)
Canned Foods (fruits, meats)
Candy (gum, chocolate)
Beverages
Teas
Carbonated Soft Drinks
Dairy
Juices
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Leaf Improvements from China Common Leaf Through GLG Proprietary Strains
For both consistency of taste in a stevia extract and cost of stevia extract Leaf accounts for over 60% of the cost of stevia extract products Our patented seeds allow
ease and lower cost in scaling agriculture vs seedling approach consistency in taste of stevia sweetener GLG to offer sustainable lower pricing in the industry
To produce one metric tonne of RA80 the approximate required amounts of different varietal leafs are:
The most important part of the supply chain to control is the Leaf
4.0
2.52.0
1.5
0
1
2
3
4
5
China Common Leaf Huinong 1 Huinong 2 Huinong 3
Metric Tonnes
RA Content in Leaf
30%-40% 60% 66% 76%
Cost Index* 100 62.5 50 37.5
* Index assumes constant cost for leaf and processing
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Growing Global Distribution Network
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AN0CTM Consumer Products Business
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AN0CTM Consumer Products
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Improving Welfare of Farmers
Health
Agriculture Business
Three Important Stakeholders for the AN0C Opportunity in China
Over USD $21+ billion addressable market size across 6 major beverage categories, 2 functional beverages and tabletop products
Growing operations with over 200,000 farmers in 10 growing regions, and expanding
Providing healthy beverage and food
alternatives to 1.3 billion consumers, especially those with diabetes or obesity
31
AN0CTM
National Coverage
As of June 2011, AN0C was in approximately 6,000 KA stores and over 59,000 traditional retail outlets.
AN0CTM
also has 13 regional sales offices
AN0C is the only national all-natural zero calorie beverage brand in China.
According to a recent brand survey: >11% of respondents
recognized the AN0C brand when placed alongside other leading brands
‘zero-calorie’ and ‘non-fattening’ were the key messaging remembered most about the AN0C brand
When given the choice to buy one brand of tea, 11% choose AN0C
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Leverage Success of AN0C Ready-to-Drink Teas and Vitamin Enriched Waters for Future Product Launches
Vitamin enriched waters launched in August into a
relatively new beverage category in China, which
AN0C expects will need more time to grow and gain
traction
New RTD tea bottles redesigned to differentiate and stand out from the pack: New Bottles, New Packaging and an Improved Taste
Zero-calorie tabletop sweetener launched in October
Upcoming products include:
herbal tea children’s drinks carbonated soft drinks functional drinks juice milk
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Key Contacts