MARKABLES® Global Top20 Brands 2015

MARKABLES® Global Top20 Brands 2015 1 11

Trademark Comparables AG Bahnhofstrasse 48 CH-6430 Schwyz Switzerland

+41 (41) 810 28 83 [email protected]

The Leading Source for

Trademark Values

MARKABLES® Global Top20 Brands 2015 Schwyz, November 17th, 2016

It goes without saying that brands create value. Strong brands help customers to find orienta-tion and satisfaction. Strong brands also make customers pay higher prices and stay loyal, thus creating financial value for the brand owner. Sometimes such brand value can be even huge, accounting for large parts of the total value of the related business.

Numerous brand value rankings and league tables are published ever year, most notably by

firms like Interbrand, Millward Brown and Brand Finance. Brands like Apple, Google and

Microsoft – among others - fight for the top spot on the podium. All brand values on these rankings have one thing in common: they are no more than personal opinions expressed by the analysts of the issuing firms. None of these brands is ever sold or acquired, and the pur-ported values remain untested by a market transaction. The MARKABLES Top20 is different.

It is the only listing where brand values are real values paid for brands in a transaction. Undoubtedly, the amount an acquirer or investor is willing to pay for a brand best describes its

real value. Looking at real transactions of brands is therefore more insightful for the under-standing of brand value and its drivers. Since 2010 MARKABLES® releases the annual Top20

most expensive brands that changed hands, according to the financial statements of all public companies worldwide. With these listings, MARKABLES® provides most meaningful insights into brand valuation parameters, multiples and value drivers. Here come the MARKABLES®

Global Top20 Brands for 2015.

I. Value Trends

2015 was a good year for brands, after a long-term downward trend of decreasing importance

of brands in corporate M&A reported by Binder and Hanssens in HBR online in April last year. Now, brands are seemingly back in the focus of M&A investors, and 2015 could mark a turning point. 2015 was a remarkable year for acquired brands in all aspects. The average brand value of the Top20 2015 reached $ 5,611 million, more than 2.5 times more than last year. Moreover, the portion of brand value within enterprise value reached 41% for the Top20 brands. Both figures mark a new record high since we started the Top20 (exhibit 1).

https://hbr.org/2015/04/why-strong-customer-relationships-trump-powerful-brands



+41 (41) 810 28 83 [email protected]

The list of the most expensive brands ever acquired (Top10 Ever) was quite flat after the fi-

nancial crisis in 2008. Between 2009 and 2014, only three transactions made it on that list. Now, the two largest brand acquisitions in 2015 reached the first and second place of the most expensive brands ever acquired - Kraft Foods by Heinz, and Newport/Lorillard by American

Reynolds (see exhibit 2), both topping longtime frontrunner Gillette in 2005. Moreover, two more acquisitions in 2015 made it in the Top20 Ever – Novartis’ OTC consumer business by GSK, and a US cigarette portfolio (Winston, Salem, and others) by Imperial Tobacco.

A detailed list of the Top20 2015 brands is set out further below in appendices A (data) and B

(business descriptions).

1. Kraft Foods 2. Newport

3. Novartis OTC

Kraft Foods with its portfolio of brands (Kraft, Philadelphia, Oscar Mayer and others) reported

brand value of $41.3 billion, representing not only best in class of 2015, but of all times, and surpassing the acquisition of Gillette by Procter & Gamble in 2005 by far. The second place in 2015 goes to the Lorillard brands acquired by Reynolds American (Newport, Kent, True, Maverick, Old Gold, blu eCigs) with $27.2 billion. Third place finisher was Novartis’ OTC

brand portfolio (including Voltaren, Excedrin, Otrivin, Theraflu, among others) acquired by GlaxoSmithKlein and valued at $9.2 billion.

Exhibit 3 illustrates how the Top20 2015 are positioned in a matrix of brand margin (premium) and brand importance (portion of brand in enterprise value). In contrast to previous years, all four top brands are positioned at the top right of the matrix. In other words – the 2015 brand acquisitions stand for premium brand-centric strategies; unlike in 2014, mass brands at the low left of the matrix played a minor role only.

Novartis OTC Newport

The 2015 Top20 brands account for an average portion of 41.3% of the total value of the en-terprise to which they belong. A remarkable increase from 33.8% in the last year (see exhibit 1). In other words, as much as 41.3% of the future profit of these enterprises is expected to come from their brands. Novartis OTC brands is best in class this year with brands accounting for 96% of enterprise value. Surprisingly, the Newport brand of premium cigarettes holds sec-

ond place with 95%; in spite – or just because – of the advertising ban on tobacco products and a decreasing per-capita consumption, the only source of future profits of this business is its brand.



+41 (41) 810 28 83 [email protected]

Newport

Another important ratio is the brand profit margin or brand premium on revenues. The average brand premium of the Top20 brands was 11.75% in 2015. This means that an average profit margin of 11.75% of revenues is directly attributable to the brand. This figure is down from 13% in 2014. In 2015, the highest brand premium was - again - found to be 35% for Newport premium cigarettes.

II. Sector Trends

Valuable and important brands typically operate in stable and relatively mature environments. They exist since long, and they have achieved leading market positions. Looking at the busi-nesses of the Top20 brands, the overall rationale of the acquisitions is rather conservative which is in the nature of their business. The large majority of the Top20 brands are rather “old school”. More than half of the acquisitions (12) were made primarily for synergies and consoli-dation; less than half (8) are growth stories.

consumer sta-ples

Like in the previous years, consumer staples are the most important sector with five brands (Kraft, Newport, Winston, Big Heart Pet Brands and Iglo). Interestingly, these five brands

have a particular strong weight with positions between numbers one and ten. Many of these brands are more regional than global. Often, successful brand value concepts are found in packaged foods, beverages, tobacco and personal care products.

where is digital?

Digital business models continue to play a minor role in brand transactions. This year, no more than three brands (down from five last year) represent the digital era. Out of the three, two are internet based brands (online travel booking site Qunar.com and online retailer zulily.com), and one is digital television (DirecTV). No telecom brand made it on the 2015 listing; transac-

tions with telecoms focused more on infrastructure and customer assets than on brands which are often replaced after acquisitions.

health care growing

Strong growth stories can be found in the health care and life science sector with four brands in the Top20. The OTC brand portfolios of Novartis and Omega Pharma achieved positions three and seven respectively. Moreover, Sigma-Aldrich (laboratory biochemicals) and Aller-gan (Rx drugs including Botox®) made it in the Top20.

retail brands flat

Brick and mortar retailers faced a backdrop, with only two entries in 2015 (down from four in 2014). Discount retailer Family Dollar placed sixth, Safeway supermarkets eleventh. Even

including the one internet retailer (Zulily, see above)), 2015 was a particularly flat year for in-vestments in retail brands.

consumer ser-

vices The consumer services sector is represented this year with two hospitality brands (Center

Parcs UK and Cara’s full service restaurants in Canada), down from three last year.

luxury and fash-ion

Like in 2014, luxury and fashion brands have been flat, illustrating both structural problems of the sector and a lack of large brands for sale. At least, one fashion brand made it on the list in



+41 (41) 810 28 83 [email protected]

2015 (Ann Inc. with Ann Taylor and Loft). Before 2014, an average of three brands from luxu-

ry and fashion made their yearly appearance in the Top20.

B2B brands often hidden

champions

And finally, the concept of brand value is not limited to consumer brands alone; an increasing number of B2B businesses is acquired (in parts) for the value of their brand names. In 2015, four brands belong to the B2B sector (Pall filtration solutions, Sigma-Aldrich laboratory chem-icals, Sikorsky aircrafts and Capital Safety fall protection products).

III. Regional Trends

US dominance

China far behind

If – after all – the various developments in 2015 mean a rebound of the importance of brands in M&A, this is fully attributable to the US. Fourteen of the 20 most valuable brands have their headquarters (and most of their business) in the United States. Even more, the two landmark acquisitions of Kraft and Newport are both US basedSimilarly, on the side of the acquirers

thirteen out of twenty have their headquarters in the US (including Actavis which has its opera-tive headquarters in the US). Other countries play only minor roles in that game, including China which is often said to buy up Western brands on a large scale.

IV. Outlook

SABMiller new all-time high?

Is 2015 a nine days’ wonder, or a sustainable turnaround? Only time will tell, and it is too early to resume the 2016 reporting season. However, there are strong signs for a lasting recovery. Some of the large acquisitions completed during 2016 convey an idea of the Top20 for 2016. In terms of brand value size and importance, it could look similar to 2015, if not better. Some important 2016 acquisitions of branded businesses include SABMiller, TimeWarner, Monsan-to, Linkedin, Chubb Insurance, Starwood Hotels or St. Jude Medical, and we are looking

forward to seeing their final brand valuations reported in the financial statements. Depending on the final structuring of the deal in compliance with regulators’ requests, the beer brand port-folio acquires with SABMiller could even top the all-time high of Kraft Foods.

Epilogue

overall im-portance of

brand

The figures and ratios describing the 20 top brands and their value contribution are impressive indeed. However, it must be clear that the Top20 represent the very top of a huge pyramid of brands – the 20 most expensive brands out of many thousands that are valued and reported in transactions every year. So, what is the nature of the brands that come further down and at the bottom of the pyramid? As for the 8,800 brands listed in MARKABLES® from real transac-

tions, they account on average for 13.5% of enterprise value and generate a brand premium of 3.3% of revenues. Thus, from a look at the entire pyramid the conclusion is that brands are often valuable assets of an enterprise but there can be other important assets like customer relations or technology.

Trademark Comparables AG

Trademark Comparables AG is a privately held, Swiss based company engaged in the valu-ation and capitalization of IP, notably brands and customer relations. Trademark Comparables AG develops valuation methods and provides input data for valuation algorithms to appraisers, auditors and investors all over the world. Trademark Comparables AG operates MARKA-BLES®, the leading and unique source for trademark values worldwide. MARKABLES® con-tains the results of over 8,800 reported and audited trademark valuations resulting from acqui-sitions and transactions. For more information, please visit www.markables.net

http://www.markables.net/

Appendix A. MARKABLES® Global Top20 Brands 2015

© MARKABLES 5 11

MARKABLES 2015 BRAND RANKING THE 20 MOST VALUABLE BRANDS THAT CHANGED HANDS IN 2015

# Brand Country Sector Brand Value

in USD mn

Brand Value in % of

enterprise value

Brand Premium

implied brand royalty rate

in % of revenues

Acquiror Country

1. Kraft Foods US Food 46,772 75.9% 25% Heinz US

2. Newport/Lorillard US Tobacco 27,193 94.8% 35% Reynolds American US

3. Novartis OTC brand portfolio CH OTC drugs 9,177 95.8% 30% GlaxoSmithKline GB

4. Lorillard cigarette brand portfolio US Tobacco 6,196 87.9% 15%

Imperial Tobacco GB

5. DirecTV US Digital television 4,287 6.8% 1.75% AT&T US

6. Family Dollar Stores US Discount retail 3,100 33.3% 3% Dollar Tree US

7. Omega OTC brand portfolio NL OTC drugs 2,427 54.4% 15% Perrigo US

8. Big Heart Pet Brands US Pet food 1,720 29.2% 8% J.M.Smucker US

9. Pall US Filtration 1,512 10.8% 6% Danaher US

10. Iglo Foods GB Food 1,484 53.4% 7.5% Nomad Foods Virgin

Islands

Appendix A. MARKABLES® Global Top20 Brands 2015

© MARKABLES 6 11

# Brand Country Sector Brand Value

in USD mn

Brand Value in % of

enterprise value

Brand Premium

implied brand royalty rate

in % of revenues

Acquiror Country

11. Safeway US Grocery retailer 1,458 15.7% 0.5% Albertsons US

12. Qunar China Online travel booking 1,432 18.5% 20% Ctrip.com China

13. Center Parks UK Holiday parks 1,099 27.3% 20% Brookfield Canada

14. Sigma-Aldrich US Biochemicals 1,069 7.2% 7% Merck Germany

15. Zulily US e-commerce 870 45.5% 7% Liberty

Interactive US

16. Sikorsky US Aircrafts 816 9.0% 1.5% Lockheed Martin US

17. Ann Taylor US Fashion 815 4.0% 3% Ascena Retail US

18. Allergan US Rx drugs 690 9.7%% 3.5% Actavis Ireland

19. Cara Canada Full service restaurants 548 93.4% 4% Fairfax Canada

20. Capital Safety US Safety equipment 546 21.9% 12% 3M US

Average Top20 2015 5,661 41.3% 11.75%

Appendix B. MARKABLES® Global Top20 Brands 2015

© MARKABLES 6 11

MARKABLES Top20 2015 THE 20 MOST VALUABLE BRANDS THAT CHANGED HANDS IN 2015 BRAND DETAILS

1. Kraft Foods

Kraft Foods Group is one of the largest consumer packaged food and beverage companies in North America and worldwide. It manufactures and markets food and beverage products, including cheese, meats, refreshment bever-ages, coffee, packaged dinners, refrigerated meals, snack nuts, dressings, and other grocery products under a host of iconic brands, primarily in the United States and Canada. Total net sales for Kraft during its most recent pre-acquisition year ended December 27, 2014 were $18.2 billion. Three brands have annual net revenues exceeding $1 billion each—Kraft cheeses, dinners, and dressings; Oscar Mayer meats; and Philadelphia cream cheese. 25 other brands have annual net revenues between $100 million and $1 billion each. The portfolio includes Cheese (Kraft and Cracker Barrel natural cheeses; Philadelphia cream cheese; Kraft and Deli Deluxe processed cheese slices; Velveeta and Cheez Whiz processed cheeses; Kraft grated and shredded cheeses; Polly-O and Athenos cheeses; and Breakstone’s and Knudsen cottage cheese and sour cream), Refrigerated Meals (Oscar Mayer cold cuts, hot dogs, bacon, and P3 Portable Protein Packs; Lunchables lunch combinations; Claussen pickles; and Boca meat alternatives), Beverages (Maxwell House, Gevalia, and Yuban coffees; Tassimo hot beverage system (under license); Capri Sun (under license) and Kool-Aid packaged juice drinks; Crystal Light, Kool-Aid, and Country Time powdered beverages; and MiO, Crystal Light, and Kool-Aid liquid concentrates), Meals & Desserts (Kraft and Kraft Deluxe macaroni and cheese dinners; Velveeta shells and cheese dinners; JELL-O dry packaged desserts; JELL-O refrigerated gelatin and pudding snacks; Cool Whip whipped topping; Stove Top stuffing mix; Jet-Puffed marshmallows; Velveeta Cheesy Skillets and Taco Bell Home Originals (under license) meal kits; Shake ‘N Bake coatings; and Baker’s chocolate and baking ingredients), Enhancers & Snack Nuts (Planters nuts and trail mixes; Kraft Mayo and Miracle Whip spoonable dressings; Kraft and Good Seasons salad dressings; A.1. sauce; Kraft and Bull’s-Eye barbecue sauces; and Grey Poupon premium mustards. Revenue breakdown is 33% for cheese and

dairy; 15% for meat and meat alternatives; 11% for meals; 10% for refreshment beverages; and 9% for enhancers. 2. Newport/Lorillard

Founded in 1760, Lorillard is the third largest manufacturer of cigarettes in the United States. Newport, our flagship premium cigarette brand, is the top selling menthol and second largest selling cigarette brand overall in the United States based on gross units sold in 2014 (33.7 bn sticks and 12.6% market share). The Newport brand, which includes both menthol and non-menthol product offerings, accounted for approximately 86.5% of our consolidated net sales for the fiscal year ended December 31, 2014. In addition to the Newport brand, our product line has four additional brand families marketed under the Kent, True, Maverick, and Old Gold brand names. These five brands include 45 different product offerings which vary in price, taste, flavor, length and packaging. In 2014, we shipped 39.0 billion cigarettes, all of which were sold in the United States and certain U.S. possessions and territories. Lorillard, through its other subsidiaries, is also a leading global electronic cigarette company, marketed under the blu eCigs brand. We produce cigarettes for both the premium and discount segments of the domestic cigarette market. We do not compete in a subcategory of the discount segment that we identify as the deep discount segment. 3. Novartis OTC brand portfolio

The Novartis OTC Business comprises the OTC medicines business carried on by Novartis’s OTC division, includ-ing OTC pipeline products and its related manufacturing network. The Novartis OTC Business is a leader in offering products designed for self-care and prevention of common medical conditions and ailments to enhance people’s overall health and well-being. It is conducted by the Novartis Group in more than 50 countries. The Novartis OTC portfolio has many well-known, widely recommended brands such as Voltaren, Excedrin, Otrivin, and Theraflu. Novartis OTC covers the areas of pain management (Voltaren, Excedrin), respiratory health (Otrivin, Theraflu), smoking cessation (Nicotinell), gastro intestinal (Benefiber, Maalox, Gas-X, Prevacid), nutrition (Calcium Sandoz), and skin health (Lamisil, Fenistil). The business operates on a global basis. Novartis focuses on a group of strategic global brands in leading product categories that include treatments for cough/cold/respiratory ailments and pain relief, as well as products for digestive health, dermatology, and smoking cessation. The Novartis OTC Business operates in most major markets (including the US, Europe and emerging markets) and the business distributes its products through various channels such as pharmacies, food, drug and mass retail outlets. The focus of research and development activities is primarily on pain relief and cough/cold/respiratory treatments, and the development of line extensions to leverage brand equities is of high importance. 4. US Cigarette brand portfolio Acquisition by Imperial Tobacco of the Winston, Salem, Kool and Maverick cigarette brands and the blu e-cigarette brand from Reynolds, together with the national sales force, office and production facilities previously owned by Lorillard. The acquired brands Calendar Year 2013 volumes of 20bn stick equivalents, net revenue of $2.4bn, brand contribution of $1.2bn, EBITDA of $0.8bn and operating profit of $0.6bn. Winston is a premium brand and current


© MARKABLES 7 11

No.7 brand in the US with 2.2% share of the US market. Maverick is a value brand with 2.0% US market share and a strong position in key states. Kool is a menthol brand with 1.9% US market share. Salem is a menthol brand with 1.2% share of market. Blu is the number one brand of e-cigarette in the US market in measured retail distribution with a reported 45% value share of the market at retail. In the financial year to December 2013, blu had net revenues of $230m. 5. DirecTV DIRECTV is a leading provider of digital television entertainment in the United States and Latin America. We operate

two direct-to-home, or DTH, business units: DIRECTV U.S. and DIRECTV Latin America, which are differentiated by their geographic location and are engaged in acquiring, promoting, selling and distributing digital entertainment programming primarily via satellite to residential and commercial subscribers. DIRECTV U.S. is the largest provider of DTH digital television services and the second largest provider in the multi-channel video programming distribu-tion, or MVPD, industry in the United States. As of December 31, 2014, DIRECTV U.S. had approximately 20.4 million subscribers. DIRECTV Latin America is a leading provider of DTH digital television services throughout Latin America. DIRECTV Latin America is comprised of: PanAmericana, which provides services in Argentina, Chile, Colombia, Ecuador, Peru, Puerto Rico, Venezuela and certain other countries in the region, and Sky Brasil Servicos Ltda., or Sky Brasil. As of December 31, 2014, PanAmericana had approximately 6.8 million subscribers, Sky Brasil had approximately 5.6 million subscribers and Sky Mexico had approximately 6.6 million subscribers. DirecTV cur-rently has a fleet of twelve geosynchronous satellites, including eleven owned satellites and one leased satellite. To gather programming content, ensure its digital quality, and transmit content to our satellites, we have two digital broadcast centers, located in Castle Rock, Colorado and Los Angeles, California and six uplink facilities. The DI-RECTV Home Service Provider, or HSP, network performs customer installation, upgrade, and service call work for us. We now directly employ over 4,500 technicians. We also utilize an additional 10,000 technicians from four major outsourced companies who have assigned territories and a number of smaller contractors around the United States. 6. Family Dollar Stores Family Dollar Stores is a leading US discount retailer offering name brands and quality, private brand merchandise. Family Dollar operates multi-price point stores providing value-conscious consumers with a selection of competi-tively priced merchandise in convenient neighborhood stores. Family Dollar’s assortment consists primarily of con-sumable merchandise and home products. Family Dollar is a neighborhood variety store offering merchandise largely for $10 or less. Family Dollar operates 8,284 stores with an average selling space of 7,200 square feet. In addition, Family Dollar operates 11 warehousing and distribution centers throughout the US. 7. Omega Pharma

Omega Pharma NV, headquartered in Belgium, generated approximately $1.6 billion of revenue during the twelve months ended September 30, 2014, making it the fifth largest player within the European OTC healthcare market and the largest or second largest player in four individual European markets. Omega owns many leading cough & cold, skincare, pain relief, weight management, and gastrointestinal treatment brands, among its portfolio of roughly 2,000 products. Omega Pharma markets health and personal care products to which the end-consumer has access without a medical prescription (Over-The-Counter/OTC). Omega Pharma owns about 2,000 brands that are sup-ported by approximately 10,000 brand registrations across the regions where it operates. The Company profiles itself as the pharmacist champion thanks to its extensive network to pharmacists and its impressive track record since its inception in 1987. On a total of approximately 2,500 employees, there are about 1000 sales representatives who visit approximately 5 to 10 pharmacists a day, thus ensuring strong in-store visibility of the Omega Pharma brands. Leading brands include Bodysol/Galenco, ACO and Lactacyd (cosmetics), Dermalex (repair), Septivon, and Wartner (skin care), Bittner/Aflubin, Prevalin/Beconase, Physiomer/Libenar and Phytosun (cough and cold), Paranix and Jungle Formula (anti-parasites), Davitamon/Etixx, Biover/Abtei and Granufink/Bional (vitamins, miner-als and supplements). 8. Big Heart Pet Brands

Big Heart Pet Brands is a leading producer, distributor, and marketer of premium-quality, branded pet food and pet snacks in the United States, headquartered in San Francisco. Its portfolio of brands includes Meow Mix®, Milk-Bone®, Kibbles 'n Bits®, 9Lives®, Natural Balance®, Pup-Peroni®, Gravy Train®, Nature's Recipe®, Canine Carry Outs®, and Milo's Kitchen®. Big Heart Pet Brands changed its name from Del Monte Corporation following the

divestiture of its Consumer Products business and namesake Del Monte brand on February 18, 2014. Big Heart Pet Brands is the largest U.S. standalone producer, distributor and marketer of premium quality, branded pet food and pet snacks. The Company’s purpose is to nurture the bond between pets and the people who love them – making every day special. Its portfolio of brands, with a foundation in dog and cat food and treats, strives to cater to every pet life stage and every family’s budget through the availability and accessibility of its products. Big Heart Pet Brands’ net sales are approximately $2.3 billion. 9. Pall Corporation


© MARKABLES 8 11

Pall Corporation is a leading global provider of filtration, separation and purification solutions that remove contami-

nants or separate substances from a variety of solids, liquids and gases. In its fiscal year ended July 31, 2015, Pall generated consolidated revenues of approximately $2.8 billion. Pall serves customers in the biopharmaceutical, food and beverage and medical markets as well as the process technologies, aerospace and microelectronics markets. Pall’s products primarily consist of consumables and systems. Consumable filtration products are princi-

pally filters made with proprietary filter media produced by chemical film casting, melt blowing of polymer fibers, papermaking and metallurgical processes, as well as smaller capital goods products, including housings. Systems, including larger capital goods, typically include proprietary consumable filtration and associated hardware. Con-sumables sales constitute 88% of sales and systems account for 12%. 10. Iglo Foods Iglo Foods is Europe's leading frozen food company whose iconic products have been part of people's lives for over half a century. The Group's core brands of Iglo, Birds Eye and Findus are category-defining names synonymous with high quality, great tasting food. The UK, Italy, Germany and Austria are the Group's largest markets, repre-senting approximately 85% of turnover. Iglo Foods is committed to bringing consumers great tasting food that can be enjoyed at every meal, every day by everybody. The freezing process preserves the intrinsic qualities of food such as taste and nutrition, as well as providing a good platform for reducing food waste. These characteristics offer great potential for innovation, ensuring that consumers can have the best ingredients for exciting and enjoyable meals. 11. Safeway Safeway operates 1,325 supermarkets in 20 states in the US under the banners Safeway, Vons, Pavilions, Ran-dalls, Tom Thumb and Carrs Quality Centers, with an extensive network of distribution, manufacturing and food processing facilities. Safeway also owned and operates GroceryWorks.com Operating Company, LLC, an online grocery channel. Safeway has 138,000 employees, 13 distribution centers, 20 manufacturing plants, and 1,041 instore pharmacies. 12. Qunar.com Qunar.com is the leading travel service platform in China, headquartered in Beijing. As an innovative technology company, Qunar aims to provide Chinese travelers with most comprehensive and accurate travel information, and bring China's travel industry online and mobile. Qunar offers real-time searches on flights, hotels and packages,

and group-buying deals and other travel information to consumers, and Internet and mobile technology solutions to travel industry players. Qunar means "where to go" in Mandarin Chinese. Qunar also operates a direct hotel network with over 350,000 hotels and offers a large selection of over 1,000,000 vacation packages from more than 7,000 suppliers. The main lines of business include flight tickets, hotels, vacation packages and attraction tickets. For the year 2015, Qunar had 171.8m web users (of which 20.6m active) and 131.6m mobile users (of which 69.6m active). 13. Center Parcs UK

Center Parcs UK operates five short break destinations across the UK: Sherwood Forest, Nottinghamshire; Elveden Forest, Suffolk; Longleat Forest, Wiltshire; Whinfell Forest, Cumbria and Woburn Forest, Bedfordshire. Center Parcs are popular with middle-class families, offering activities such as sailing, swimming and horse riding alongside spa packages. In 2015, Center Parcs expects to welcome more than two million guests. The Center Parcs concept originated in Holland in 1967, with Sherwood Forest opening in the UK in 1987. Center Parcs UK is a separate entity to Center Parcs Europe. Each Center Parcs is nestled within around 400 acres of protected and enhanced woodland, with the holiday village designed to complement and work with the forest environment. Center Parcs UK’s occupancy levels have averaged approximately 97% over the last five years. Guests pay a basic fee for accommodation — usually a short weekend or midweek break — and then book activities online ahead of their visit such as bike rides, crazy golf, badminton and water sports. More than 60 per cent of visitors return within three years and 35 per cent return within one year. 14. Sigma-Aldrich Sigma-Aldrich, a leading Life Science and Technology company focused on enhancing human health and safety, manufactures and distributes 250,000 chemicals, biochemical, kits and other essential products to more than 1.4 million customers globally in research and applied labs as well as in industrial and commercial markets. With three distinct business units - Research, Applied and SAFC Commercial - Sigma-Aldrich is committed to enabling science to improve the quality of life. The Company operates in 37 countries, has approximately 9,700 employees worldwide and had sales of $2.79 billion in 2014. Sigma Aldrich’s significant trademarks are the brand names: Sigma-Aldrich, Sigma, Aldrich, Fluka, Riedel-de Haën, Supelco, SAFC, SAFC Biosciences, SAFC Hitech, Genosys, Proligo, Phar-morphix, Cerilliant, Vetec, BioReliance and Cell Marque. 15. Zulily.com


© MARKABLES 9 11

zulily is an online retailer obsessed with bringing customers special finds every day—all at incredible prices. zulily

features an always-fresh curated collection for the whole family, including clothing, shoes, home décor, toys, gifts and more. Unique products from up-and-coming brands are featured alongside favorites from top brands, giving customers something new to discover each morning. zulily was launched in 2010 and is headquartered in Seattle. The business model of rapidly launching new styles allows zulily to easily experiment with new categories efficiently

and cost-effectively. The average value of an order is $56.07. Current categories include: Women’s Apparel (Ap-parel, Special Sizes, Maternity/Nursing, Intimates, Accessories, Shoes); Children’s Apparel (Infant, Two to Six Year Old Children, Tween Girls, Tween Boys, Accessories, Shoes); Men's Apparel (Apparel, Accessories, Shoes). Chil-dren’s Merchandise (Infant Gear, Sports Equipment, Toys, Books), Other Merchandise (Kitchen Accessories, Home Décor, Entertainment, Electronics, Pet Accessories, Health and Beauty Products). Primary vendors are emerging brands and smaller boutique vendors. These are typically small-to-medium sized businesses. Since these vendors’ products are typically not available broadly online, the vendors generally work with us to gain brand awareness and generate incremental sales. We introduce these vendors to our large audience and help them tell their stories in a way that differentiates their products and properly reflects their brand attributes. Our entire operational infrastructure - photography studios, editorial writers, fulfillment operations and technology capabilities - is designed to showcase these emerging brands’ and smaller boutique vendors’ products in the most compelling, engaging and personalized way. 16. Sikorsky Aircraft Headquartered in Stratford, Connecticut, Sikorsky Aircraft designs, manufactures, services, and supports a range of military rotorcraft platforms for commercial and military customers worldwide. The business employs nearly 15,000 employees in 11 countries. Its helicopters are used by all five branches of the U.S. armed forces, along with military services and commercial operators in 40 nations. It produces UH-60M, HH-60M, and S-70 Black Hawk helicopters for use in utility, troop and cargo transport missions, air assault, medical evacuation, combat search and rescue, command and control, and VIP transport; and MH-60S, MH-60R, and S-70B SeaHawk helicopters for use in naval operations, including anti-submarine warfare, anti-surface warfare, and troop and cargo transport missions. The company also offers S-76 and the S-92 civil engineering helicopters; and M28 fixed wing aircraft. In addition, it provides aftermarket services and support solutions, such as spare parts, mission equipment, modification and upgrade services, overhaul and repair services, contract maintenance services, and logistics support programs for helicopters and other aircraft. 17. Ann Taylor

ANN INC. is a leading national specialty retailer of women’s apparel, shoes and accessories, sold primarily under the “Ann Taylor” and “LOFT” brands. The company’s rich heritage dates back to 1954, when the first Ann Taylor store was opened in New Haven, Connecticut. Back then, “Ann Taylor” represented a best-selling dress style that embodied the well-dressed woman. As of January 31, 2015, ANN Inc. operates 1,030 retail stores in 47 states, the District of Columbia, Puerto Rico and Canada, comprised of 245 Ann Taylor stores, 537 LOFT stores, 116 Ann Taylor Factory stores, 127 LOFT Outlet stores and five Lou & Grey stores. In addition to stores, clients can shop online in more than 100 countries worldwide at www.anntaylor.com and www.LOFT.com. Since 1954, Ann Taylor has been at the forefront of American fashion, leading the way with the idea that style shouldn’t be work and getting dressed should be about getting ready for really big days and those just as important small moments. Ann Taylor is polished, modern feminine classics with an iconic style point of view for every aspect of her life. Originally estab-lished in 1995 as an extension of the Ann Taylor brand, LOFT now stands on its own. LOFT offers modern, feminine and versatile clothing for a wide range of women with one common goal: to help them look and feel confident, wherever the day takes them. 18. Allergan

Allergan is a multi-specialty health care company focused on developing and commercializing innovative pharma-ceuticals, biologics, medical devices and over-the-counter products for the ophthalmic, neurological, medical aes-thetics, medical dermatology, breast aesthetics, urological and other specialty markets in more than 100 countries around the world. The specialty pharmaceuticals segment produces a broad range of pharmaceutical products, including: ophthalmic products for dry eye, glaucoma, inflammation, infection, allergy and retinal disease; Botox®

for certain therapeutic and aesthetic indications; skin care products for acne, psoriasis, eyelash growth and other prescription and over-the-counter skin care products; and urologics products. The medical devices segment pro-duces a broad range of medical devices, including: breast implants for augmentation, revision and reconstructive surgery and tissue expanders; and facial aesthetics products. Revenues break down into eye care pharmaceuticals (46%), Botox and neuromodulators (31%), skin care (7%), breast aesthetics (7%) and facial aesthetics (9%). Prod-ucts are sold directly through own sales subsidiaries in approximately 40 countries and, supplemented by inde-pendent distributors, in over 100 countries worldwide. US accounts for 63%, international for 37% of revenues. Marketed products include – among others - Restasis®, Refresh® and Optive™, Lumigan®, Ganfort™, Alphagan®, Combigan®, Acuvail®, Acular®, Zymaxid®, Lastacaft®, Elestat®, Ozurdex®, Botox®, Aczone®, Tazorac®, La-tisse®, Vaniqa®, SkinMedica®, Natrelle®, Inspira®, BRST™ and CUI™, Seri®, Juvéderm®. 19. Cara restaurants


© MARKABLES 10 11

Cara is Canada's largest full-service restaurant company and franchises, owns and operates numerous restaurant

brands across Canada. The Company is over 125 years old and operates some of the most recognized brands in the country. A family-owned enterprise with a history beginning in 1883, the Company employs approximately 26,000 Canadians in its corporate and franchised restaurant locations. Cara operates 997 restaurants, including 959 restaurants in Canada and 38 locations internationally under the Swiss Chalet, Harvey's, Milestones, Mon-tana's, Kelsey's, East Side Mario's, Casey's, New York Fries, Prime Pubs, Bier Markt, and Landing brands. Cara Operations Limited was founded in 1883 and is based in Vaughan, Canada. 20. Capital Safety Capital Safety is a leading global provider of fall protection equipment, one of the fastest-growing safety categories within the global personal protective equipment industry. Demand for personal protective equipment is rapidly grow-ing, driven by increasing regulatory focus on worker safety across both developed and developing countries. Capital Safety's industry-leading products and solutions include harnesses, lanyards, self-retracting lifelines and engi-neered systems sold under well-known global brands DBI-SALA and PROTECTA. The business employs approxi-mately 1,500 people worldwide in 27 operating sites and is headquartered in Bloomington, Minn. The company’s fall protection products are sold throughout the world. In addition to manufacturing, Capital Safety also provides in-

house and on-site fall protection and rescue training services. It partners with insurance providers to hold 4-hour to 5-day safety training classes.


© MARKABLES 11 11

METHODOLOGY AND EXPLANATIONS

MARKABLES is a trademark value database listing all trademarks that have been acquired, valued, accounted

and reported in the financial statements of over 15,000 listed companies worldwide. Basis for such reporting is typically the acquisition of a business combination including a trademark, in very rare cases the acquisition of a trademark only.

The Top20 brand ranking lists the 20 most valuable that changed hands during a particular year and are listed

in MARKABLES. There is no obligation for listed companies to publish detailed information about business combinations and

the individual assets (i.e. trademarks) included therein in their financial statements. We believe that - due to their size and materiality - most of the most expensive acquired brands are published in financial statements and retrieved by MARKABLES. However, it is possible that important acquired brands remain undiscovered or undisclosed to the public.

The brand value reported by MARKABLES is the value that the acquirer ascribes to the brand in the purchase

accounting process. The value of the brand is a portion of the price which was paid to gain control over the total business (business combination), including the brand and all other assets. Control means that the ma-jority of the shares of the business were acquired. Depending on the acquired business, brand value can consist of one major brand or brand house, or of several brands (brand family or brand portfolio). Insofar, a reported brand value is the sum of all brands being part of the acquired business.

Brand value is calculated according to international and national accounting and financial reporting standards

(i.e. IFRS, IASB, FASB, FRS, IDW and other). Typically, the valuation of assets acquired in business combi-nations is performed by independent qualified appraisers (i.e. ASA, CPA ABV, NACVA, CBA, EAVCA and others) and audited for the financial statements by CPAs.

Enterprise value is the purchase price to acquire the (branded) business, plus the assumption of financial

debt. Thus, enterprise value is calculated as purchase price for the shares acquired, plus value of the minority share not acquired, plus value of the net financial debt acquired.

Brand value figures are usually reported in the currency of the acquirer. For comparison, MARKABLES uses

a yearly average exchange rate to convert such local currency figures into USD figures. Percentage ratios are calculated in the local currency of the reporting entity.

Brand value in % of enterprise value is a static ratio of the two figures as valued at the date of the acquisition. Brand premium in % of revenues is the pre-tax profit on net sales which the brand must generate each year

over its expected future life. This figure does not include profit that must come from other assets. The future profits coming from brand are needed to fully pay back the amount that was spent to acquire the brand. Con-ceptually, the brand premium concept comes close to a royalty relief approach which is frequently used in the valuation of brands. Royalty relief in other words means, what royalty rate on branded revenues must the business pay if it did not own the brand (at the accounted purchase price) but had to license it from a third party instead. The calculation of the implied royalty rate requires the assumption of a discount rate and growth rate to be applied on future branded or licensed revenues.

Brand revenue is the annual brand revenue at the date surrounding the acquisition. The reporting period can be the year prior to the acquisition, the trailing 12 months period, the 12 months around the acquisition date, or the financial year after the acquisition.

Documents

MARKABLES® Global Top20 Brands 2015