25. September 2014.

How to Grow and Increase Market Share in an Economy which

is experiencing Recession?

The Agrokor Way

Tomislav Jukić

A Beautiful Place…

…But Challenging for Doing Business

Still, some succeed…

Entering new businesses Water&Beverages

(Jamnica)

Edible oils&Margarines (Zvijezda)

Retailing&Wholesale (Konzum)

Ice cream&Frozen food (Ledo)

Starting regional expansion (B&H)

Ice cream&Frozen food (Ledo Čitluk)

Water&Beverages (Sarajevski kiseljak)

Entering Serbian market Ice cream&Frozen food

(Frikom)

Further expansion Serbia

Retailing&Wholesale (IDEA)

Edible oils&Margarines (Dijamant)

Croatia

Agriculture (Belje)

Meat (PIK Vrbovec)

Further food retail

business expansion in Primary markets1)

Entering EU market (Hungary)

Ice cream&Frozen food (Baldauf)

Water&Beverages (Fonyódi)

Food retail expansion in B&H

Retail&Wholesale (Konzum B&H)

Capital structure strengthening EBRD 8.33% equity stake

Focus on efficiency, core businesses and capital optimization

1976 ’93-’94 2000 2003 2004 2005 2006 ’07-’08 2009 ’95-’00 1989 ’10-’14

Ivica Todorić registers

Agrokor as a joint stock company

Ivica Todorić Founded Agrokor as a flower cultivation and trading company

Consolidation and strenghtening of the balance sheet

Integration of acquired businesses and

focus on organic growth Audited accounts

Public rating

1) Primary markets include Croatia, Serbia and Bosnia and Herzegovina

4

A Glimpse into History…

RETAILING

AND

WHOLESALE

556,313 sqm 12,000 sqm Selling area

CAGR 2013 Unikonzum 1994

1,068

Croatia #1

Serbia #3

B&H #1

23,935

€174 mn

€3.1 bn

150 No. of stores

Market position

1,800

–

€0.03 bn 28%

No. of employees

EBITDA

Total sales

Sales per employee €130,574 €14,000 9.3x

5

… With Proven Expertise in Value Creation…

1,013

1,197

1,614

2,428

2,824

2,873

3,151

3,303

3,491

3,917

4,365

4,374

4,736

6,025

9,044

- 2,500 5,000 7,500 10,000

Auchan

Reál

Ahold

SPAR

Carrefour

Mercator

Agrokor Retail

CBA

Delhaize Group

Metro Group

Tesco

Rewe Group

COOP Euro

Agrokor Retail+ Mercator

Schwarz Group

________________________________________________

Source: Planet Retail. Note: Includes food retail formats market shares and total banner sales for grocery retailers. (1) Based on estimated banner sales owned or operated by the group including VAT, franchised operations and partly owned stores / chains, with the exception of Mercator and

Agrokor Retail which are as reported. SEE defined as Albania, B&H, Bulgaria, Croatia, Czech Republic, Greece, Hungary, Macedonia, Montenegro, Romania, Serbia, Slovakia, Slovenia.

2012 Sales in SEE(1)

(€m)

Agrokor Retail and Mercator

Romania

Bulgaria

Macedonia

Hungary

Slovakia

Czech Republic

#2

#1

#1

#1 #1

Greece

Company Market Share

Mercator 25.2%

SPAR (Austria) 12.1%

TUS Trgovine 9.2%

Aldi 6.5%

Schwarz Group 5.2%

Slovenia

Company Market Share

Agrokor + Mercator 34.8%

Agrokor 29.0%

Schwarz Group 9.7%

Mercator 5.8%

Plodine 4.9%

SPAR (Austria) 3.8%

Croatia

Company Market Share

Delhaize Group 15.1%

Agrokor + Mercator 13.4%

Mercator 8.0%

Agrokor 5.4%

Metro Group 3.1%

ITM (Intermarché) 1.0%

Serbia

Company Market Share

Mercator 12.9%

Delhaize Group 6.9%

Lukoil 0.2%

Montenegro

Company Market Share

Agrokor + Mercator 14.2%

Bingo 8.2%

Agrokor 7.7%

Mercator 6.5%

Delhaize Group 4.3%

ITM (Intermarché) 3.1%

TUS Trgovine 1.4%

Bosnia & Herzegovina

…And a View to the Future

• Centralized delivery from own warehouses

• EDI with partners

• Automated invoice matching and ordering of goods

Operational Efficiency

Integrated Business

Understanding local specifics

Innovative services

Understanding Customers

• ‘From the Field To the Table’

• Own agricultural and meat (frozen products, oil, water,…) production

• Highest quality, recognized and awarded brands

• Total of 25,000 – 40,000 SKUs in three countries in the Primary Markets

• Two private label brands comprising over 3,000 products

• Local sourcing, particularly of produce

• Training center

• Billing service that enables customers to pay utility bills in Konzum stores

• Self check-out, self-scan, mobile app and 24/7 store services

• Cash withdrawals, Lottery and event tickets

• Multiplus mobile (MVNO)

• Konzum Benz petrol stations next to prime store locations

• Loyalty card program in Croatia comprising of more than 1.1 mn customers

• COALITION LOYALTY launched in Sept ’10 in Croatia and in May ‘13 in Serbia

• Customer Centric Retailing – segmenting customers based on purchasing

• power and adjusting store offering accordingly

7

Key Levers of Success

Understanding Customers

10

Leadership position throughout the region

Strong portfolio and expansion of portfolio

Leadership position in Croatia and Bosnia and Herzegovina

Strengthened presence in Serbia through acquisition of Mivela

Leading carbonated and water brands

Leadership position throughout the region

Launched a portfolio of healthy oil and margarine products to

adjust/set the changing market trends

Own sourcing – control of raw materials and input prices

Leadership position in Croatia with growing market share

Strategic goal: traceability of all fresh meat products (“from field to table”)

DLG awards and implementation of OHSAS 18001:2007

Largest Croatian agricultural company controlling over 75,000ha of fertile

land in Croatia and over 160,000ha in total

Main activities include livestock breeding, crop husbandry and wine

production

Edible Oils and

Margarines

Water and

Beverages

Fresh and

Processed Meat

Agriculture

Ice Cream and

Frozen Food

Product Key characteristics Key companies/brands

We hold market shares of over 50% in most of these segments and have delivered double digit growth over the last 7-10 years

Integrated Business

Innovative services

Thank You!