Quality You Can Trust Almarai Company · Almarai Company 2010 Q1 Earnings Presentation 15 Thank you Almarai Company Exit 7, North Circle Road Al Izdihar District P.O. Box 8524 Riyadh,

Quality You Can Trust

Almarai Company

2010 Q1 Earnings Presentation


Almarai Company 2010 Q1 Earnings Presentation 2

Information contained in this presentation is subject to change without further notice, its accuracy is not guaranteed and it may not contain all material information concerning the company. Neither we nor our advisors make any representation regarding, and assumes no responsibility or liability for, the accuracy or completeness of, or any errors or omissions in, to any information contained herein.

In addition, the information contains projections and forward-looking statements that reflect the company’s current views with respect to future events and financial performance. These views are based on current assumptions which are subject to various risks and may change over time. No assurance can be given that future events will occur, that projections will be achieved, or that the company’s assumptions are correct. Actual results may differ materially from those projected.

This presentation is strictly not to be distributed without the explicit consent of Almarai Company management under any circumstances.

Disclaimer



Highlights 1st quarter 2010: a good start in the new year

Another excellent set of financial consolidated results characterised byRevenue growth of 17.6% from SAR 1,326.1 to SAR 1,559.5 million

Net income growth of 18.6% from SAR 197.4 to SAR 234.1 million

Cash flow from operating activities of SAR 462.5 million or 29.7% of sales compared to SAR 338.6 million for the same period of 2009

Further reduction in Net Operating Working Capital following our continuous effort to reduce inventories

Divisional PerformanceDairy and Juice division - another excellent performance both in terms of net sales (+12.6%) and net income (+29.7%)

Bakery division – excellent sales growth (+32.7%); net income (-3.2%) impacted by pre-investment costs in preparing for capacity expansion

Poultry division – Focus is on improving quality, systems, distribution to achieve medium term higher yields

Arable and Horticulture – seasonal business, Q1 has very low sales

Announcement of 50:50 Joint Venture with Mead Johnson for Infant Nutrition in the GCC. Mead Johnson is recognised as the leading Infant Nutrition company in the world



Income Statement 1st quarter

SAR million Change

Net Sales 1,559.5 100.0% 1,326.1 100.0% 17.6%

Direct Material Costs (703.5) (45.1%) (606.0) (45.7%) 16.1%

Margin over Material 856.0 54.9% 720.1 54.3% 18.9%

Other GOGS (286.0) (18.3%) (211.9) (16.0%) 35.0%

Gross Profit 570.0 36.6% 508.2 38.3% 12.2%

Selling and Distribution Expenses (236.5) (15.2%) (201.1) (15.2%) 17.6%

General and Administration Expenses (55.4) (3.5%) (58.9) (4.4%) (6.0%)

EBIT 278.2 17.8% 248.2 18.7% 12.1%

Share of Results of Associates (1.8) (0.1%) 0.0 0.0% n.a.

Bank Charges (32.2) (2.1%) (45.8) (3.5%) (29.7%)

Income from Main and Continous

Operations 244.1 15.7% 202.4 15.3% 20.6%

Zakat (7.0) (0.4%) (5.2) (0.4%) 34.1%

Minority Interest (3.1) (0.2%) 0.2 0.0% n.a.

Net Income 234.1 15.0% 197.4 14.9% 18.6%

2010 2009

1st quarter



Sales 1st quarter 2010 by Products and regions

Sales by Products

Sales by Regions

KSA

69.7%

Kuwait

6.3%

Qatar

4.4%

Bahrain

2.4%

UAE

11.1% Oman

5.0%Export

1.2%

Fresh Dairy, 43.4%

Long-Life Dairy, 10.9%

Fruit Juice, 10.0%

Cheese & Butter, 21.2%

Bakery, 11.4%

Poultry, 2.3%

Arable and Horticulture, 0.2%

Other Sales, 0.5%

2010 2009 % change

Fresh Dairy 677.6 614.1 10.3%

Long-Life Dairy 170.6 148.0 15.3%

Fruit Juice 155.3 124.8 24.4%

Cheese & Butter 330.7 298.0 11.0%

Bakery 178.3 134.4 32.7%

Other Sales 7.7 6.9 11.2%

Sub-Total 1,520.1 1,326.1 14.6%

Poultry 36.0 - n/a

Arable and Horticulture 3.4 - n/a

Total Sales 1,559.5 1,326.1 17.6%

Sales by Product Group

SAR Million

1st quarter



Performance 2005-2010 by Quarter7

8.0

90

.6

12

2.8

16

2.2

19

7.4

23

4.1

10

0.3

12

1.8

16

5.3

23

5.2

28

7.1

10

0.9

12

2.6

18

6.1

29

3.7

36

3.4

10

6.9

13

0.2

19

3.1

21

9.2

24

8.8

0

50

100

150

200

250

300

350

400

SAR

Mill

ion



Cash Flow Statement

SAR Million 2010 2009

From Operating Activities 462.5 338.6

Used in Investing Activities (437.3) (683.1)

From Financing Activities (291.3) 281.3

Increase/(Decrease) in Cash (266.1) (63.2)

Cash at beginning of period 507.7 246.6

Cash at end of period 241.6 183.4

Quarter ended 31st March



Balance Sheet

SAR Million 31.03.2010 31.12.2009

Net operating working capital 635 711

Biological Assets 737 735

Property,Plant and Equipment 6,609 6,282

Net operating assets 7,981 7,728

Intangible Assets - Goodwill 793 793

Investment and Financial Assets 977 995

Net Assets 9,751 9,517

Net debt 3,975 3,951

Employee termination benefits 172 166

Shareholders’ equity 5,585 5,383

Minority Interest 19 17

Net Capital Employed 9,751 9,517


Segment Reporting

SAR MillionDairy &

JuiceBakery Poultry

Arable and

Horticulture

Other

Activities

Almarai

Consolidated

1st Quarter 2010

Sales 1,347.4 189.9 36.0 8.0 - 1,581.2

Third Party Sales 1,341.9 178.3 36.0 3.4 - 1,559.5

Net Depreciation 57.1 16.7 6.2 9.8 - 89.7

Income before Minority Interest 239.6 26.0 (8.8) (16.7) (2.8) 237.2

Total Assets 7,418.6 1,614.0 447.6 900.1 613.8 10,994.0

Total Liabilities 4,422.7 217.9 68.0 30.4 651.1 5,390.2

Return on Sales 17.9% 14.6% n.a. n.a. n.a. 15.2%Growth versus Q1 2009- Third Party Sales 12.6% 32.5% n.a. n.a. n.a. 17.6%- Income before Minority Interest 29.7% (3.2%) n.a. n.a. n.a. 20.3%



Looking Forward

Continued focus on existing business

Dairy & Juice

Bakery

with the objective of doubling our 2008 business by 2013

Improve and expand poultry business

Build the existing business and, through “quality’ across all aspects of the business, play a leadership role

Expand capacity from presently 25 to 100 million birds p.a.

Infant formula

Capitalize on the strength of both JV partners to prepare a successful market entry

IDJ

Drive growth and market share in both Jordan and Egypt

Search for new opportunities


50:50 Joint Venture between

2010 Q1 Earnings Presentation

and

Almarai Company 112010 Q1 Earnings Presentation


Highly dedicated employees and management teamwith a commitment to improving the health and nutrition of infants

Global Supply Chain ExcellenceState-of-the-art production facilities, together with focus on continuous improvement

Integration of nutritional science with marketing expertiseLeading innovator in category with significant advances in pediatric nutrition – supported by clinical research

Extensive Product PortfolioHighest quality products, generating significant consumer retention and conversion.Strong links with key decision makers in the Health Care Community

Who is Mead Johnson Nutrition

Leading Brand Globally in the Infant Formula Category

Net sales 2009 US$ 2.8 billion

CAGR over 5 years: 8.5%

Market Share leader in USA, the world’s largest infant formula market

Global leader in Children’s nutrition

Leader in China, Philippines, Thailand, Malaysia and Mexico – 5 of 6 biggest markets.

Mead Johnson Nutrition - Profile



JV leverages contributions from both companies

Brand

Distribution

Sales Force

Manufacturing / Supply Chain

R&D

Regulatory

• Almarai brand (Top 3 in Middle East)

• Umbrella brand for entire GCC

• Distribution capabilities for retail

• Managing local trade relationships

• Access to trade partners

• GCC consumer research

• Strong network of retail and hospitals

• 17,300 MT Infant Formula/Children

Nutrition plant with spray dryer

• Integrated milk supply

• Cost-advantaged raw materials

• Packaging innovation

• Access to local regulatory authorities

• Mead Johnson and Enfamil brands

• Stages 1, 2, 3, 4 and specialty formulas

• Medical marketing expertise

• Sales force training

• Ingredients and formulations

• Global manufacturing base

• Expertise in mfg. and quality processes

• Global scale in sourcing

• Clinical claims and scientific validation

• Access to MJN’s innovation pipeline

• Relations with global organizations

• Compliance processes



27 Great Brands of Tomorrow* Excerpts from

Credit Suisse projection about future outperformers

Last month, Credit Suisse recognized Enfamil and Almarai in the top 27 global brands

“Almarai Co: A Danone In The Making… The

brand has consistently gained market share,

and we believe it will continue to proliferate as it

enters new tranches, such as baby food.”

“Enfamil: A Brand That Translates To Any

Language… MJN with its flagship Enfamil

brand has the highest exposure to the rapid

growth emerging markets in Asia and Latin

America of any U.S. food brand making it the

best long-term growth story in the package food

group.”

* Great Brands of Tomorrow by Credit Suisse Research Institute, 25 February 2010




Thank you

Almarai CompanyExit 7, North Circle RoadAl Izdihar DistrictP.O. Box 8524Riyadh, 11492Saudi Arabia

Contact for investor relations matters:Khalid M. Al Nasser+966 1 470 00 05 ext [email protected]

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Quality You Can Trust Almarai Company · Almarai Company 2010 Q1 Earnings Presentation 15 Thank you Almarai Company Exit 7, North Circle Road Al Izdihar District P.O. Box 8524 Riyadh,