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EUROPE'S BIGGEST ORGANIC FOOD PRODUCER FROM FIELD TO SHELF

AUGA GROUP AB

JULY 2018

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DISCLAIMER

This document has been prepared jointly by AUGA Group AB ("Company") and AS LHV Pank ("LHV"), together called the "Parties", for informational purposes only. This document does not by any means constitute an offer or a solicitation, nor a recommendation to purchase or sell securities, commodities, currencies or other investments referred to herein. This document does not constitute independent investment advice. The document belongs to the Parties. The information contained in this document has been compiled from published sources which the Parties believe to be reliable and accurate and in good faith. The Parties are not responsible for any decisions taken by third parties on the information provided in this presentation. The information provided herein cannot be the basis for any subsequently concluded agreement.

Although carefully verified, the Parties make no representations or warranties of any kind, expressed or implied, about the completeness, accuracy, reliability or suitability with respect to the information contained herein. Any reliance placed on such information is therefore strictly at the risk of the reader. In no event shall the Parties be liable for any loss or damage including direct, indirect, consequential loss or damage arising in connection with the use of the information contained herein. The Parties shall also assume no other obligations or liability of whatever nature in connection with this material, such as for example an obligation to ensure the offering and issue of any securities or an obligation to update this information should the underlying circumstances change, etc. No respective claims can be brought against any of the Parties in connection with the information contained herein.

This document contains forward-looking statements that are based on the Parties' expectations, estimates, projections and assumptions. Forward-looking statements involve risks and uncertainties that may cause actual results to differ materially from those contemplated by such statements. Forward-looking statements are made and based on information available to the Parties on the date of this document. The Parties do not assume, and expressly disclaim, any obligation to update this information, nor do the Parties take any responsibility to guarantee any result predicted in this document to become actual.

The information of this presentation does not encompass all the information, disclosed by the Company and should be read together with the Company's publicly announced financial information and prospectus of public offering. The financial data provided should be evaluated together with the financial statements and prospectus of public offering. The data presented reflect the situation for a past periods of time and results for a past period are not reliable indicator of future performance.

No investment decision shall be based on this material. In connection with a potential capital raising, the Company has published a prospectus according to applicable laws and regulations. In any case, investments into shares of the Company are associated with investment risk. The value of the Company's shares can both rise and fall, and the investor may recover less than invested or even lose the entire invested amount. Past financial results of the Company do not guarantee future performance.

AGENDA

Offering termsheet
Executive summary
Company highlights
Transformation to organic farming
Planned activities
Organic world
Corporate governance and share details
Company financials
Appendices

Presented by

Kęstutis Juščius
The Chairman of the Board

Linas Bulzgys
Board Member, CEO

OFFERING TERMSHEET

OFFERING SIZE	Using mid-point of the price range, expected net proceeds for AUGA – up to EUR 18,200,000.
OFFER SHARES	Up to 40,000,000 newly issued ordinary registered shares.
Up to 40,000,000* existing ordinary registered shares.
Total number of offered shares: up to 80,000,000*.
*The number of existing ordinary registered shares was increased by 20,000,000 shares after the July 16th extraordinary general meeting of shareholders. For more information see the first supplement of the prospectus.
OFFER PERIOD	Offering starts: July 3, 2018 at 09:00 Lithuanian time
Offering ends: August 17, 2018 at 15:30 Lithuanian time
**The Management Board decided to extend the offering (second supplement) on account of the execution of a Framework Agreement with the European Bank for Reconstruction and Development (“EBRD”). This event coincided with the height of the vacation period so it was decided to provide more time for investors to absorb the news.
ELIGIBILITY	Public offering in Lithuania.
Private placement according to legislation where allowed.
Institutional and/or qualified Investors.
ALLOCATION, SETTLEMENT AND TRADING	Allocation: on or about August 20, 2018.
Settlement: on or about August 23, 2018.
Trading in new shares is expected to commence on Nasdaq Vilnius and Warsaw Stock Exchange on or about August 30, 2018.**
CONDITIONAL MOVE TO NASDAQ BALTIC MAIN LIST	On June 26, 2018 Nasdaq Vilnius announced a decision of conditional admission of AUGA’s new shares and move of existing shares to the Nasdaq Baltic Main List if certain conditions are met.
LOCK-UP	The selling shareholder (i.e. Baltic Champs Group UAB holding 88.13% of all shares prior to the offering) signed lock-up agreement for 24 calendar months from the settlement date.

*The Prospectus and both supplements are available here: https://www.lb.lt/en/list-of-approved-prospectuses-in-accordance-with-article-13-of-directive-2003-71-ec
** Management Board announcement: https://cns.omxgroup.com/cdsPublic/viewDisclosure.action?disclosureId=848837&messageId=1067661

OFFERING PRICE RANGE

| PRICE RANGE, NOMINAL VALUE AND VWAP | Price range EUR 0.45–0.50
Nominal value: EUR 0.29
VWAP (12 months): in Vilnius EUR 0.5013, in Warsaw PLN 1.6673 (EUR 0.3938).
VWAP (6 months): in Vilnius EUR 0.5372, in Warsaw PLN 1.658 (EUR 0.3929). |
| --- | --- |
| LATEST SIGNIFICANT TRANSACTION | In December 2016, the Group’s major shareholder Baltic Champ Group, UAB increased its stake in AUGA group from 51.56% to 88.13% by acquiring the shares of significant minority for the average price of EUR 0.61 per share. |

*The Prospectus and both supplements are available here: https://www.lb.lt/en/list-of-approved-prospectuses-in-accordance-with-article-13-of-directive-2003-71-ec

EXECUTIVE SUMMARY

Overview

With 38,000 ha under management, AUGA is the largest vertically integrated organic agriculture company in Europe
AUGA controls all processes from seed to final product
Considering equity capital injection for development of recent acquisitions and new investment projects: poultry, dairy, biogas, other technologies

Key strengths

Large scale organic supply from one source with full traceability
Wide range of organic commodities and end-consumer products
Certified with the EU Organic, USDA, BRC, Kosher, Global GAP
Experienced and skilled management
Strong R&D

Strategy

Focus only on organic and sustainable food production
Achieve efficiency by utilizing scale of operations, synergies among different agricultural sectors and applying latest scientific knowledge to improve all production processes
Grow share of value-added end-consumer products using proprietary and contracted manufacturing, with full process control from field to shelf

Investment opportunity

Growing global organic market
Healthy and sustainable food trends, driven by new consumer generation
Unique company know-how and operational set-up
Vertical integration backed by economies of scale

COMPANY HIGHLIGHTS

Main revenue stream is generated by 3 segments: mushrooms, agriculture (crops) and milk
Gross profit mainly comes from agricultural business segment (around 89%)
Company is export oriented; ca. 80% of sales are export
End-consumer products comprise significant part of sales

Financial Overview

EURm	2015	2016	2017	2017Q1	2018Q1
Revenue	47,4	39,6	48,8	12,1	11,5
Gross profit	10,4	10,8	14,9	2,2	1,7
EBITDA*	12,7	11,2	14,2	10,8	13,8
EBITDA**	10,7	9,6	13,2	9,3	12,7
Net profit	5,6	2,1	5,0	0,02	0,6
Net debt	42,6	30,3	42,9	35,7	53,6

EBITDA* - net cash flows from operating activities eliminating adjustments for loss (gain) on change in fair value of biological assets, changes in working capital, income tax paid, interest received, interest paid. Changed in 2017, AUGA will use this formula in the coming reporting periods. This was done to align the approach used by lenders for setting loan covenants. 2017Q1 and 2018Q1 represent data for 12 months period ended on March 31.

EBITDA** is calculated as profit before interest, corporate income taxes, depreciation and amortization in addition to eliminating one-off effects to net profit. 2017Q1 and 2018Q1 represent data for 12 months period ended on March 31.

2017 sales by segment
Total: EUR 48.8 million

2017 gross profit by segment
Total: EUR 14.9 million

2017 sales by markets

2017 sales geography

TRANSFORMATION MILESTONES

Merger of Agrowill Group and Baltic Champs	Start of organic farming	2nd transition year	Fully certified organic farming	Integrated organic food company
			Acquisition of KTG Agrar	Acquisition of Raseiniu Agra

New era begins for the company	Launch of organic mushrooms	Launch of organic packaged vegetables	Launch of organic milk and grain products	Sales growth of branded and end-consumer products

Arrival of new controlling shareholder via Baltic Champs reverse takeover denotes strategic change in operational influence and direction. Shares from existing shareholders were also bought later in 2016 for prices up to EUR 0.63*

Already EUR 15m invested:
- New technology for organic fertilization
- New technology for cultivation and weed control
- Loose cattle grazing
- New equipment for vegetable growing and processing
- Prototyping poultry farms

New development projects:
- Combined feedstock production plant
- Expanding poultry farms
- Further development of recently acquired agricultural companies
- Biogas conversion and purification, introduction of biomethane as a second-generation biofuel
- Building new generation dairy farms
- Other R&D activities

*Source: https://cns.omxgroup.com/cdsPublic/viewDisclosure.action?disclosureId=751970&messageId=942771

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INTEGRATED SUSTAINABLE FARMING MODEL

Synergy among different branches of agriculture with focus on sustainability.

SUSTAINABILITY AGENDA

AUGA group is committed to the development of sustainable agriculture and does more than required by EU organic regulations.

Currently the min-till technology is applied on 46% of cultivated agricultural land of AUGA group to improve land quality and preserve biodiversity.
Already purchasing only green electricity and utilizing in-house renewable energy plants (solar and wind).
Planned projects to convert cow manure to biogas and use it for fuel, and use organic digestate as efficient fertilizer.

For more information see AUGA Sustainability Report for 2017 published in April 2018*

*Source: https://cns.omxgroup.com/cdsPublic/viewDisclosure.action?disclosureId=832738&messageId=1047053

OPERATIONAL ASSETS

The Group gains efficiency of returns through leasing of land rather than low returns as an owner, operating in the most fertile areas of Lithuania.

After acquisitions of KTG Agrar and Raseiniu Agra, the harvested land area expanded from 27k ha in 2017 to 38k ha in 2018
8.4% of land is owned, rest is managed on the basis of long term lease agreements
In 2016, average cost of asset (land) in Lithuania was 3,340 EUR/ha, vs. 19,614 EUR/ha in Germany, 9,100 EUR/ha in Poland
In 2016, land rent cost per year was on avg. 124 EUR/ha for AUGA group (125 EUR/ha in 2017), vs. Germany average 288 EUR/ha, Poland average 209.9 EUR/ha
All AUGA land is certified organic. Due to recent acquisitions 18% of AUGA land is in P2 transition period, to be completed in 2019

Sources: https://www.destatis.de/DE/Publikationen/StatistischesJahrbuch/Landforstwirtschaft.pdf?__blob=publicationfile, http://www.vic.lt/?mid=151&id=26954, http://stat.gov.pl, http://appsso.eurostat.ec.europa.eu/nui/submitViewTableAction.do, http://archyvas.vic.lt/?mid=151&id=26395.

Location of AUGA farms and land quality in Lithuania

Managed land, ha

PROVEN ACHIEVEMENTS: ABOVE AVERAGE YIELDS

Due to internal integration with dairy farming and mushroom growing, the possibility to obtain sufficient quantities of organic farming compliant fertilizers (manure), the application of innovative land cultivation technologies and tooling, the Group achieves superior crop yields.

Wheat yield, t/ha in Lithuania

Leguminous plants yield, t/ha in Lithuania

Source: Lithuanian institute of agrarian economics, AUGA group data

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PROVEN ACHIEVEMENTS: ORGANIC POULTRY FARMS

The Company has developed its own designs which meet EU organic farming regulations, use renewable energy and deliver improved animal welfare standards. Two pilot projects have been successfully executed.

Own designs which meet efficiency targets (labour, energy).
Powered by solar energy with remote monitoring and control.
Improved animal welfare (critical for organic farms as there is no possibility to use antibiotics).
Compliant with strict EU organic farming regulations
Chickens have access to outdoor areas all-year-round (except for restricted time periods.

AUGA PRODUCT PORTFOLIO

BEETROOTS & MUSHROOMS
READY TO EAT SOUPS
RAPESEED OIL

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NEW PRODUCTS IN 2018

Wide range of products grown and produced allows the Company to offer variety of final consumer products.

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ROUTE TO MARKET

The Group’s ability to accumulate large volume of organic commodities, which often is a scarce resource in the fast-growing organic food markets, allows to utilise contract manufacturing model for various end consumer products with professional processors and to control the longer value chain from field to shelf.

SUMMARY OF AUGA COMPETITIVE POSITION

The Group manages an unique platform of agricultural assets which together with skilled employees, know-how and technologies applied form the basis for long term competitiveness of AUGA group's business model.
The Group cultivates approx. 38 thousand hectares of high quality and fertile agricultural land. Land plots are consolidated around the individual agricultural companies, which allow to use modern and efficient agricultural technologies, achieve economies of scale and have efficient logistics and storage solutions.
Due to internal integration with dairy farming and mushroom growing, the possibility to obtain sufficient quantities of organic farming compliant fertilisers (manure), the application of innovative land cultivation technologies and tooling, the Group achieves superior crop yields, which are comparable or even higher than in organic farms in the most fertile areas of Germany or France. Due to various limiting factors this parity of yield with best EU farms would not be possible to achieve in conventional farming. In combination with still lower labour costs and the economies of scale, this allows to gain a significant cost advantage within the EU and global organic markets.
The Group gains efficiency of returns through leasing of land rather than low returns as an owner. 8.4% of land is owned and the rest is managed based on long term lease agreements. The Group rents the land from around 2.7 thousand individuals and companies which allows to significantly reduce the risks of losing the land rent. Additionally, the Company has pre-emptive rights to prolong the land lease or to purchase the rented land from the lessor.

SUMMARY OF AUGA COMPETITIVE POSITION CONT.

The size of the Company and the ambitious vision of its shareholders allow to hire and retain experienced and skilled management and talent. The possibility to hire very professional organic agriculture specialists internationally allowed the Group to speed up the learning and knowledge accumulation process in its core agriculture activities and to have smooth transition from conventional to organic farming. It also allowed the Company to create its marketing and end-consumer product development as well as sales department from scratch and to start and successfully manage various projects in other areas (poultry, biogas extraction, combined feed production etc.) where the Company have not had experience in the past, but which are strategically important for the new business model.
The Group’s ability to accumulate large volume of organic commodities, which often is a scarce resource in the fast-growing organic food markets, allows to utilise contract manufacturing model for various end consumer products with professional processors and to control the longer value chain from field to shelf.
The focus only on organic farming and strict internal control procedures almost eliminate the risks of organic product’s contamination. Full traceability of everything, from seed to pack, is controlled by one company which ensures the high quality of products and helps to gain trust from private label producers, retailers, as well as final consumers of branded AUGA products.
Wide range of products grown and produced allows the Company to offer variety of final consumer products, such as full range of flour, preserved products, ready to eat soups, vegetables, mushrooms, dairy products, etc. The Company also has flexibility to grow different varieties of grain/vegetables in large scale according to the market trends and needs. All these factors make the Group a perfect supplier for various large international private label producers (major Retail chains) seeking reliable supply of wide range of organic food products.

PLANNED ACTIVITIES: CURRENT BUSINESS

Successful completion of cultivated land area expansion and its conversion to organic farming is the main focus of the Group at the moment. It is planned that cultivated land area will grow over 40% in 2018 compared to 2017 and reach around 38 thousand ha (KTG Agrar and Raseinių Agra).
It is planned that the number of livestock will remain stable. Milk produced by the Group was certified as organic since August 2017, however as at the end of year 2017 not all milk output was sold with an organic price premium. The Group aims to significantly increase the percentage of milk sold with an organic price premium during 2018.
The cultural mushrooms business is expected to remain in leading positions across the Baltics, with no significant production capacity expansion plans forecasted for the coming years. After full transition to organic mushroom operation can be supplied with sufficient amounts of organic straw, which was the key bottleneck in the past to growing organic mushrooms. Therefore the Group expects to increase the percentage of production of organic mushrooms and develop new sales markets for this particular product.

For more information on segment analyses and trends see AUGA prospectus available from: http://auga.lt/wp-content/uploads/2018/07/AUGA-group-Prospectus.pdf

PLANNED ACTIVITIES: NEW PROJECTS

Additional capital is planned to be used for ongoing development projects.

A combination of both equity, bank debt and internal cash flow financing sources are expected to be applied, with the total capex program of EUR 30 million.

Use of proceeds by the Company	EUR m
1. Further development of recently acquired agricultural companies	4
2. Combined feedstock production plant	7
3. Expanding poultry farms	6
4. Biogas conversion and purification, introduction of biomethane as a second-generation biofuel	4
5. Building new generation dairy farms	6
6. Other R&D activities	3
Total	30

DEVELOPMENT OF RECENTLY ACQUIRED AGRICULTURAL COMPANIES

The Groups seeks to implement same agricultural processes and technologies in the new companies in order to reach the same efficiencies as in existing operations.

Additional investments are planned into specialised organic agriculture tolling & equipment, seed preparation technology and working capital in order to integrate recently acquired two agriculture companies – KTG Agrar and Raseiniu Agra.
These two acquisitions executed during 2017 expanded the land cultivated by the Group from 25 to 38 thousand hectares in 2018.

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COMBINED FEEDSTOCK PRODUCTION PLANT

A dedicated organic feedstock production plant is essential for high quality organic feed availability for internal purposes (cattle and poultry undergoing expansion) and for selling to the market.

At present there are insufficient facilities in the region (capacity, quality) when it comes to providing organic-based grain processing. Utilising conventional facilities for organic purposes is not possible due to contamination risk. It is expected that around half of the total capacity would be used internally. Different types of feed are required for different animals, including within the dairy cow herd.
More than half of the costs for animal-related operations are feed-related. High quality feed is essential for the economics of dairy and poultry farming. Materials sourced would be provided by the Company as well as trusted local farmers. This also helps to maximise traceability of the products to be used.
Currently the majority of grain is sold externally as a commodity. This helps to extend the total value added for each product.
Should such a feedstock production plant project not be executed by the Company this could lead to reduced efficiency of both the Company's and surrounding farms' operations.

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EXPANDING POULTRY FARMS

Scaling to meet the growing demand of organic poultry and eggs.

Taking into account the region's colder climatic conditions, the Company has developed its own designs which meet both efficiency targets (labour, energy) and deliver improved animal welfare (critical for organic farms as there is no possibility to use antibiotics). Furthermore, they meet the EU organic farming regulations, which are quite strict.
Organic free-range farming regulations also require poultry to be able to spend time outdoors for certain periods. The farms have solar power and can be run using a mobile phone-related application (remote monitoring and control).
Two pilot projects have been successfully executed by the Group. Poultry and eggs are staple foods when it comes to an everyday consumer's diet, hence a full-scale launch is planned.

BIOGAS CONVERSION AND PURIFICATION

CO2 neutral farming can be achieved by producing biogas from cow and chicken manure, upgrading it to purified biomethane and switching fuel for tractors from diesel to biogas.

The Group participates in joint venture with the other financial and industrial investors which plans to build 5 anaerobic digestion production plants in the territory of the Group's agriculture companies. These plants will convert majority of manure used currently as organic fertiliser in the Group's agriculture companies into raw biogas (~60% biomethane).
The digestate (organic waste left after biogas production) will be used as an effective fertilizer. Using organic digestate not only reduces greenhouse gas emissions but also improves grain fertility on average 18%, compared to regular organic fertilizers (such as manure) used in organic farming. The Group plans to make additional investments into digestate accumulation and storage facilities in order to efficiently apply this valuable fertiliser during major seeding and cultivation periods in spring and autumn.
Purification of raw biogas provides very clean fuel which has high energy value, however the existing production processes of upgrading the raw biogas to purified biomethane still cause environmental methane pollution (leakage during the upgrade process). Therefore, the Group participates in and leads a cluster of deeply-involved parties (including a university) which aims to create technology which would eliminate such leakage.
The Group also co-operates with producers developing biomethane-driven tractor prototypes, with the aim of having them upgraded and introduced such equipment into the Company's daily operations.
Current EU regulation and local legislation are very supportive for this project as there are high requirements for countries in reaching amount of second generation biofuel used in transportation.

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NEW GENERATION DAIRY FARMS

Organic milk is one of the main items in the organic food consumer basket. To achieve a closed loop organic agriculture model, the Company also needs a sufficient supply of cow manure.

The Group plans to build two pilot dairy farms to be equipped with latest technology and innovations to ensure animal welfare (including life expectancy, better health and shelter facilities, milk yield).
To be transparent about the Company's products' transition from field to shelf and to increase consumer confidence, the farms will also be open to consumers for educational purposes.
These two new farms will not only be full-scale production facilities, but upon successful completion of the pilot projects the Company will be using the accumulated knowledge to build additional dairy farms.

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OTHER R&D ACTIVITIES

The Group is committed to using the most innovative technologies and methods in its operations, as they ensure better crop yields, enables farming in a sustainable way and produces organic food at affordable prices.

The trend towards organic food is quite new and a rapidly developing area, existing technologies and its producers cannot keep pace with the requirements and the needs of organic farming and production.
Therefore, the Group itself selectively develops its own solutions and equipment for sustainable food value chain from farm to end-consumer. Some of the proceeds will be used for:
development and implementation of all such equipment and solutions;
pre-preparation phases of new investment projects to further expand the Company's future growth prospects.

USE OF PROCEEDS BY THE SELLING SHAREHOLDER

The selling shareholder intends to use the net proceeds from the sale of existing shares for the repayment of outstanding debts, incurred on the buyout of significant minority shares in 2016.

In December 2016, UAB Baltic Champs Group, controlled by Kęstutis Juščius, acquired 68.5 million of Company shares from significant minority paying in total EUR 41.9 million, financed by a bank loan, and increased its stake in AUGA group from 51.56% to 88.13%.
This was the largest transaction of Company shares in recent years at the average price of EUR 0.61 per share.
At the time of transaction Kęstutis Juščius stated that “the share purchase price is logical and reasonable because the number of shares to be purchased not only allows to take full control of the Company but also provides opportunities to attract new capital, required for new business development and for the implementation of new projects seeking sustainable and environmentally friendly organic farming model” and, in his opinion, it reflected the fair value of the Company.
By selling 40 million shares* now the selling shareholder intends to use the net proceeds primarily for the repayment of outstanding debts which at the date of this Prospectus amounts to a net EUR 28.5 million.
The selling shareholder also aims to contribute to the increase of free float of AUGA group’s shares in order to meet the conditions for moving into Nasdaq Baltic Main List.

*The number of existing ordinary registered shares was increased by 20,000,000 shares after the July 16th extraordinary general meeting of shareholders. For more information see the first supplement of the prospectus here: https://www.lb.lt/en/list-of-approved-prospectuses-in-accordance-with-article-13-of-directive-2003-71-ec

ORGANIC WORLD

In 10 years consumers have more than tripled their consumption of organic products and demand continues to grow.

CAGR of organic market in EU 9% and US 11% from 2004 to 2016
In 2016, global organic sales reached 90 billion US dollars (USD 43.3 bn US, EUR 33.5 bn Europe)
Highest organic products consumption per capita is in Europe: Switzerland (EUR 262), Denmark (EUR 191), Sweden (EUR 177)
Most European markets continued double-digit growth in 2016: France (22%), Denmark (14%), Norway (20%), Ireland (22%)

Source: http://www.ifoam-eu.org/en/organic-europe; http://www.organic-europe.net; http://www.organic-world.net/yearbook/yearbook-2018.html

ORGANIC RETAIL SALES VS. FARMLAND IN EUROPE

Retail sales of organic products grow faster than their supply capacity (farmland).

In 2016, European organic farmland area increased by 6.7%, while sales grew by 12%

Europe: Cumulative growth of organic area and retail sales 1999-2015 compared
Source: FIBL-AMI surveys 2006-2017

EU-28

Retail sales growth

Annual growth 12%
Growth over time 112%
Equivalent spend per capita

60.5 EU equivalent 650.3

Source: http://www.ifoam-eu.org/en/organic-europe ; http://www.organic-europe.net

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ORGANIC VS. CONVENTIONAL PRICES

Organic products prices are higher than conventional products and did not suffer price decline, contrary to conventional.

Germany, as largest EU market, is a benchmark for major organic products prices

Organic vs Conventional Raw Milk price, EUR/100 kg

Organic vs Conventional wheat price in Germany, EUR/t

Source: www.ami-informiert.de, http://www.stat.gov.it/

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ORGANIC FOOD IS A MEGA CONSUMER TREND

New generation of consumers not only like organic food but are willing to pay more for it.

THINKING HEALTHY ATTRIBUTES ARE IMPORTANT VS. WILLINGNESS TO PAY PREMIUM FOR THEM*

CONSUMER ATTITUDES TOWARDS FOOD**

80% believe they can improve their life by choosing healthier food

75% believe that today most of the food is not natural and not ecological

62% would agree to ban the use of any pesticides and chemical fertilizers

75% agree that it is more important how the product was produced than who sells it

Source: * Nielsen Global Health and Wellness Survey 2014. ** The truth about health & wellness. McCann Truths 2015. US, Canada, UK, Germany, France, Italy, Spain, Sweden, Holland, Croatia, Lithuania

CORPORATE GOVERNANCE

Supervisory Council

Vladas Lašas

The Chairman of the Supervisory Council

Doctor of technical sciences and the Chairman of the Supervisory Council of AB AUGA group

Rimantas Rudzkis

Member of the Supervisory Council

A senior researcher at Mathematics and Informatics Institute of Vilnius University

Liudas Navickas

Member of the Supervisory Council

The investment advisor, consulting Domeina Company

All of the members of the Supervisory Council are independent.

Management Board

Kęstutis Juščius

The Chairman of the Management Board

The founder and the Chairman of the Management Board of UAB Baltic Champs Group

Linas Bulzgys

Member of the Management Board, CEO

CEO of AB AUGA group since 2015

Marijus Bakas

Member of the Management Board

Head of Širvintai unit of UAB Baltic Champs

Linas Strėlis

Member of the Management Board

Board member of AB Vilkyškių Pieninė and AB Umega group

Agnė Jonaitytė

Member of the Management Board

Attorney at law

SHAREHOLDER STRUCTURE AND LISTING DETAILS

Kestutis Juščius

The chairman of the board

Baltic Champs Group UAB

88.13%

AUGA

GROUP AB

Multi Asset

Selection

Fund

5.83%

Other

Shareholders

6.04%

AUGA Group is currently dual-listed
Admission to trading on the Baltic Secondary List of Nasdaq Vilnius Stock Exchange (AUG1L) from 2 April 2008
Admission to trading on the Warsaw Stock Exchange (AUG) from 8 July 2011
The company has filed an application to Nasdaq Vilnius for a move from the Baltic Secondary List to the Baltic Main List
An increase in equity would allow for an increase in free float

INCOME STATEMENT

EUR'000	2015	2016	2017	2017 Q1	2018 Q1
	audited			unaudited
Revenues	47,425	39,630	48,784	12,107	11,492
Cost of sales	-36,735	-27,985	-38,012	-9,660	-9,394
Gain (loss) on changes in fair value of biological assets	-289	-868	4,159	-281	-423
Gross profit	10,401	10,777	14,931	2,168	1,675
Operating expenses	-6,069	-7,014	-8,585	-1,932	-833
Revaluation of investment property	3,339	-	-	-	-
Other income	458	127	351	53	147
Operating profit	8,129	3,890	6,697	289	989
EBITDA*	12,702	11,213	14,193	10,757	13,750
EBITDA**	10,748	9,623	13,178	9,286	12,724
Finance cost	-2,001	-2,098	-1,904	-272	-364
Profit (loss) before income tax	6,128	1,792	4,793	17	625
Income tax expense	-569	353	222	-	-
Net profit (loss) for the year	5,559	2,145	5,051	17	625

EBITDA - net cash flows from operating activities eliminating adjustments for loss (gain) on change in fair value of biological assets, changes in working capital, income tax paid, interest received, interest paid. Changed in 2017, AUGA will use this formula in the coming reporting periods. This was done to align the approach used by lenders for setting loan covenants. 2017Q1 and 2018Q1 represent data for 12 months period ended on March 31.
EBITDA* is calculated as profit before interest, corporate income taxes, depreciation and amortization in addition eliminating one-off effects to net profit. 2017Q1 and 2018Q1 represent data for 12 months period ended on March 31.

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BALANCE SHEET

EUR'000	2015	2016	2017	2018 Q1
	audited			unaudited
Assets
Non-current assets
Property, plant and equipment	89,634	76,262	85,253	88,463
Biological assets	6,637	6,858	8,029	7,949
Other non-current assets	10,590	3,573	5,867	8,408
Total non-current assets	106,861	86,693	99,131	104,820
Current assets
Biological assets	4,067	5,223	10,111	12,861
Inventory	8,856	15,157	25,547	23,770
Trade receivables, advance payments & other receivables	11,414	13,367	10,765	11,937
Cash and cash equivalents	4,068	1,650	620	1,040
Assets held for sale	-	-	2,374	4,247
Total current assets	28,405	35,397	49,417	53,855
Total assets	135,266	122,090	148,548	158,675
Equity and liabilities
Capital and reserves
Share capital and premium	62,241	62,241	55,089	55,089
Reserves	8,002	4,541	6,303	6,303
Retained earnings (accumulated deficit)	-1,434	5,163	17,241	17,905
Equity attributable to equity holders of the Company	68,809	71,945	78,633	79,297
Non-controlling interest	321	293	382	343
Shareholders equity, total	69,130	72,238	79,015	79,640
Non-current liabilities
Non-current financial debt	21,319	20,365	22,522	25,928
Grants	3,852	3,286	3,657	3,687
Deferred tax liability	2,820	433	656	656
Total non-current liabilities	27,991	24,084	26,835	30,271
Current liabilities
Current financial debt	25,359	11,625	21,069	28,695
Trade payables	8,473	8,796	14,467	14,358
Other payables and current liabilities	4,313	5,347	5,855	4,608
Liabilities directly associated with assets classified as held for sale	-	-	1,307	1,103
Total current liabilities	38,145	25,768	42,698	48,764
Total liabilities	66,136	49,852	69,533	79,035
Total equity and liabilities	135,266	122,090	148,548	158,675

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CASHFLOW STATEMENT

EUR'000	2015	2016	2017	2018 Q1
	audited			unaudited
Cash flows from / (to) operating activities
Net profit (loss) before income tax	6,128	1,792	4,793	625
Adjustments for non-cash expense (income) items and other adjustments
Depreciation expense	6,177	6,058	6,800	1,742
Amortisation expense	151	50	178	54
Other adjustments	773	4,181	-1,737	-1,152
Changes in working capital
(Increase) decrease in biological assets	1,419	-2,245	-6,568	-3,830
(Increase) decrease in trade receivables and prepayments	-2,690	-1,289	3,468	-1,453
(Increase) decrease in inventory	-65	-7,567	-6,675	3,917
(Decrease) increase in trade and other payables	-1,473	1,723	5,908	-2,721
	10,420	2,703	6,167	-2,818
Income tax paid	-735	0	0	0
Interest received, gross	50	48	0	0
Interest paid, gross	-1,676	-1,945	-1,802	-344
Net cash flows from / (to) operating activities	8,059	806	4,365	-3,162
Cash flows from / (to) investing activities
Purchase of property, plant and equipment	-4,198	-4,329	-4,950	0
Purchase of non-current intangible assets	-2	-14	-17	-546
Other investing activities	2,656	5,773	-1,584	-1,853
Net cash flows from / (to) investing activities	-1,544	1,430	6,552	-2,399
Cash flows from / (to) financing activities
Loans repaid to banks	-12,768	-19,101	-5,921	-11,568
Borrowings received	14,795	17,352	12,130	15,000
Other borrowings obtained (paid)	-4,521	-851	-1,547	3,000
Finance lease repayments	-851	-2,054	-3,504	-451
Other	-156	0	0	0
Net cash flows from / (to) financing activities	-3,501	-4,654	1,158	5,981
Net (decrease) / increase in cash and cash equivalents	3,014	-2,418	-1,030	420
Cash and cash equivalents at the beginning of the period	1,054	4,068	1,650	620
Cash and cash equivalents at the end of the period	4,068	1,650	620	1,040

OFFERING TERMSHEET

OFFERING SIZE	Using mid-point of the price range, expected net proceeds for AUGA – up to EUR 18,200,000.
OFFER SHARES	Up to 40,000,000 newly issued ordinary registered shares.
Up to 40,000,000* existing ordinary registered shares.
Total number of offered shares: up to 80,000,000*.
*The number of existing ordinary registered shares was increased by 20,000,000 shares after the July 16th extraordinary general meeting of shareholders. For more information see the first supplement of the prospectus.
PRICE RANGE, NOMINAL VALUE AND VWAP	Price range EUR 0.45–0.50
Nominal value: EUR 0.29
VWAP (12 months): in Vilnius EUR 0.5013, in Warsaw PLN 1.6673 (EUR 0.3938).
VWAP (6 months): in Vilnius EUR 0.5372, in Warsaw PLN 1.658 (EUR 0.3929).
OFFER PERIOD	Offering starts: July 3, 2018 at 09:00 Lithuanian time
Offering ends: August 17, 2018 at 15:30 Lithuanian time
**The Management Board decided to extend the offering (second supplement) on account of the execution of a Framework Agreement with the European Bank for Reconstruction and Development (“EBRD”). This event coincided with the height of the vacation period so it was decided to provide more time for investors to absorb the news.
ELIGIBILITY	Public offering in Lithuania.
Private placement according to legislation where allowed.
Institutional and/or qualified Investors.
ALLOCATION, SETTLEMENT AND TRADING	Allocation: on or about August 20, 2018.
Settlement: on or about August 23, 2018.
Trading in new shares is expected to commence on Nasdaq Vilnius and Warsaw Stock Exchange on or about August 30, 2018.**
CONDITIONAL MOVE TO NASDAQ BALTIC MAIN LIST	On June 26, 2018 Nasdaq Vilnius announced a decision of conditional admission of AUGA’s new shares and move of existing shares to the Nasdaq Baltic Main List if certain conditions are met.
LOCK-UP	The selling shareholder (i.e. Baltic Champs Group UAB holding 88.13% of all shares prior to the offering) signed lock-up agreement for 24 calendar months from the settlement date.

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Thank you!

Find out more at www.auga.lt
More videos about AUGA at Youtube

APPENDIX 1: LITHUANIAN MACRO SETTING

Real GDP, % y-o-y

Of the three Baltics, Lithuania's efforts to diversify its trade away from Russia has done the most to mute the impact of the Russian embargo in long run
Growth for 2017 is estimated at 3.6%, up from 2.3% in 2016 (2018E: 2.8%; 2019E: 2.6%) – which is consistently faster than the EU average
As with its Baltic neighbours, wages are rising as well as employment levels, supporting private consumption and forming the basis of the sustained improvement in GDP
Agriculture remains a key segment contributing consistently to over 3.0% of gross GDP (2016 EU28 average = 1.3%)

(current prices)	2013	2014	2015	2016
Lithuania
- Total gross value added, EURm	31,690	33,068	33,709	34,789
- Agriculture, forestry and fishing gross value added, EURm	1,251	1,252	1,288	1,155
- % gross value added	3.9	3.8	3.8	3.3
- % gross GDP	3.6	3.4	3.4	3.0
EU28
- Total gross value added, EURm	12,158,356	12,571,778	13,241,913	13,331,932
- Agriculture, forestry and fishing gross value added, EURm	208,695	204,796	204,311	200,551
- % gross value added	1.7	1.6	1.5	1.5
- % gross GDP	1.5	1.5	1.4	1.3

Source: Eurostat

APPENDIX 2: AUGA GROUP VIDEOS

https://www.youtube.com/watch?v=ixak1ANw7EY

https://www.youtube.com/watch?v=evS46h_tqAE

https://www.youtube.com/watch?v=1n8woCaa778

https://www.youtube.com/watch?v=EFTIFwIGHpo

https://www.youtube.com/watch?v=4eCz93zn0HY

https://www.youtube.com/watch?v=p_U--qXMNBw

AI assistant

AUGA group — Investor Presentation 2018

2259_rns_2018-07-24_eeccb6f5-68bb-430c-8022-72dea84efb3f.pdf

EUROPE'S BIGGEST ORGANIC FOOD PRODUCER FROM FIELD TO SHELF

DISCLAIMER

AGENDA

OFFERING TERMSHEET

OFFERING PRICE RANGE

EXECUTIVE SUMMARY

Overview

Key strengths

Strategy

Investment opportunity

COMPANY HIGHLIGHTS

TRANSFORMATION MILESTONES

INTEGRATED SUSTAINABLE FARMING MODEL

SUSTAINABILITY AGENDA

OPERATIONAL ASSETS

PROVEN ACHIEVEMENTS: ABOVE AVERAGE YIELDS

PROVEN ACHIEVEMENTS: ORGANIC POULTRY FARMS

AUGA PRODUCT PORTFOLIO

NEW PRODUCTS IN 2018

ROUTE TO MARKET

SUMMARY OF AUGA COMPETITIVE POSITION

SUMMARY OF AUGA COMPETITIVE POSITION CONT.

PLANNED ACTIVITIES: CURRENT BUSINESS

PLANNED ACTIVITIES: NEW PROJECTS

DEVELOPMENT OF RECENTLY ACQUIRED AGRICULTURAL COMPANIES

COMBINED FEEDSTOCK PRODUCTION PLANT

EXPANDING POULTRY FARMS

BIOGAS CONVERSION AND PURIFICATION

NEW GENERATION DAIRY FARMS

OTHER R&D ACTIVITIES

USE OF PROCEEDS BY THE SELLING SHAREHOLDER

ORGANIC WORLD

ORGANIC RETAIL SALES VS. FARMLAND IN EUROPE

ORGANIC VS. CONVENTIONAL PRICES

ORGANIC FOOD IS A MEGA CONSUMER TREND

CORPORATE GOVERNANCE

Supervisory Council

Vladas Lašas

Rimantas Rudzkis

Liudas Navickas

Management Board

Kęstutis Juščius

Linas Bulzgys

Marijus Bakas

Linas Strėlis

Agnė Jonaitytė

SHAREHOLDER STRUCTURE AND LISTING DETAILS

INCOME STATEMENT

BALANCE SHEET

CASHFLOW STATEMENT

OFFERING TERMSHEET

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APPENDIX 1: LITHUANIAN MACRO SETTING

APPENDIX 2: AUGA GROUP VIDEOS

More from AUGA group

AUGA group Investor Presentation 2018