SELECT HARVESTS LIMITED — Investor Presentation 2016

Aug 25, 2016

Select Harvests Limited (“ASX:SHV”)

FY16 Results Presentation

26 August 2016

Disclaimer & Basis of Preparation

This presentation is provided for information purposes only and has been prepared using information provided by the company. The information contained in this presentation is not intended to be relied upon as advice to investors and does not take into account the investment objectives, financial situation or needs of any particular investor. Investors should consider their own individual investment and financial circumstances in relation to any investment decision.

Certain statements contained in this presentation may constitute forward-looking statements or statements about future matters that are based upon information known and assumptions made as of the date of this presentation. These statements are subject to risks and uncertainties. Actual results may differ materially from any future results or performance expressed, predicted or implied by the statements contained in this presentation.

2

Agenda

Overview & Highlights

Results Discussion & Analysis

Market Outlook

SHV Crop Update & Outlook

Appendices

3

FY16 Financial Overview

• Reported FY16 Net Profit after Tax (NPAT) of $33.8m

• Underlying FY16 Net Profit after Tax (NPAT) of $27.9m

• Underlying EBIT $41.3m (FY15 EBIT $89.6m)

• Food Division EBIT $10.3m (FY15 $6.8m)

• Operating cash flow $92.9m (FY15 $30.4m)

• Net Debt $67.3m (including lease liabilities) - Gearing (Net Debt to Equity) 23%

• Underlying Earnings per Share (EPS) – 38.5 cents per share (FY15 86.8 cps)

• Dividend - Final Dividend (Franked) 25 cents per share - total FY16 dividend 46 cents per share (FY15 50cps)

• Record Date: 5 September 2016

• Payment Date: 30 September 2016

Strong performance & cash generation in challenging conditions – validates SHV’s robust business model

4

Business Overview

• Business environment challenged - Almond price & currency, negative & volatile.

• Strong balance sheet underpins growth - Sale & leaseback funding 2,084 acres (844 Ha) planting

• Growth on track - Almond greenfield planting increased crop by 12% by 2018 & 63% by 2025

• Cost out and capacity- Project H2E, Project Parboil operational Q1 CY2017

• Food Division turn around – Both Industrial and Branded strategy creating value

• Tree Health - improving as high performance orchard program gains traction

Generated cash, invested for productivity & growth during difficult point in the cycle

5

Business Overview

Safety

■ Lost Time Injury Frequency - down 29%

■ Medically Treated Injury Frequency - down 25%

■ Hazard Identification Frequency - up 75%

Sustainability

• Zero environmental breaches

• Commissioned first off grid solar power farm hub

Diversity

■ Overall there was a 3% increase in female participation levels, with females representing 30% of the workforce

• 43% of employees are from a culturally diverse background

• First female was appointed to Board

Our business is becoming safer, more diverse and sustainable

6

FY16 Results in Context

Underlying NPAT (A$ million)

Planted/Bearing Almond Orchards (acres)*

==> picture [299 x 134] intentionally omitted <==

----- Start of picture text -----

59.4
27.9
22.9 21.6
9.5
FY12 FY13 FY14 FY15 FY16
----- End of picture text -----

Harvest Volume (MT)

==> picture [299 x 145] intentionally omitted <==

----- Start of picture text -----

Planted Acres Bearing Acres
16,521
13,311 13,824
11,943 12,319
10,022
8,804 8,804 9,295 9,443
FY12 FY13 FY14 FY15 FY16
Planted acres as of August End
----- End of picture text -----*

Almond Price (A$/kg)

==> picture [299 x 134] intentionally omitted <==

----- Start of picture text -----

14,500 14,200
12,000
10,500
5,830
FY12 FY13 FY14 FY15 FY16
----- End of picture text -----

==> picture [298 x 134] intentionally omitted <==

----- Start of picture text -----

11.45
8.50
8.08
6.38
5.08
FY12 FY13 FY14 FY15 FY16
----- End of picture text -----

FY16 was the second best financial performance in the company’s history

7

Understanding FY16 Result

Reported FY16 Net Profit after Tax (NPAT)	$33.8m
Impact of non-recurring items	$5.9m
■Gains on Asset Sales during the Period*

Underlying FY16 Net Profit after Tax (NPAT) $27.9m

*** Gains on Asset Sales during the Period**

3 properties sold to First State Super (Sale & Leaseback)

Western Australian property sold for $9.5 million

Operating profits boosted by asset sales

8

Income Statement

Financial Result	FY15	FY16
	($m)	($m)
Reported Result
EBIT - Reported	85.9	49.8
Interest	(5.3)	(5.5)
NPBT	80.5	44.3
Tax Expense	(23.7)	(10.5)
NPAT - Reported	56.8	33.8
Underlying Result
EBIT – Underlying	89.6	41.3
Interest	(5.3)	(5.5)
NPBT	84.3	35.8
Tax Expense	(24.9)	(7.9)
NPAT -Underlying	59.4	27.9

■ FY16 Underlying EBIT $41.3m (FY15 $89.6m)

■ Almond Division Underlying EBIT $36.1m (FY15 $87.5m)

• Strong performance in challenging market

• 2016 crop key drivers - 14,200 tonnes & A$8.08/kg inc. AUD currency 6% stronger

Risk mitigation & productivity

• Harvest and processing completed significantly earlier

■ Food Division Underlying EBIT $10.3m (FY15 $6.8m)

• Industrial sales up 17% (last year 28%)

• Improved sales mix towards branded products

• Improved price management and cost control

■ Underlying NPAT down 53% to $27.9m (FY15 $59.4m)

Strong result in challenging market

9

Balance Sheet

Year Ending Balance Sheet	Jun-15	Jun-16
	($m)	($m)
Current Assets excl. Cash	207.5	154.1
Cash	0.3	1.4
Non-Current Assets	280.1	294.3
Total Assets	487.9	449.8
Current Liabilities (excl. Borrowings)	40.8	51.2
Borrowings	110	68.7
Non-Current Liabilities (excl. Borrowings)	49.7	39.0
Total Liabilities	200.5	158.9
Total Equity	287.4	290.9
Net Debt	115.6	67.3
Net Debt/Equity	40.2%	23.1%

■ Net Debt $67.3m (FY15 $115.6m)

includes finance lease commitments of $41.8m

■ Gearing (Net debt/equity) 23.1%

■ Working capital reduction driven by 2015 crop sell through

Prudent balance sheet to support growth strategy throughout the business cycle

10

Cash Flow

Cash Flow	FY15 ($m)	FY16 ($m)
EBITDA	96.4	62.4
Change in Working Capital	(61.0)	35.4
Net Interest	(5.0)	(4.9)
Cash flow from operating activities	30.4	92.9
Investing cash flows	(99.9)	(47.8)
Proceeds from asset sales	-	73.2
Increase/(decrease) in Debt	5.8	(84.8)
Increase in Equity	64.7	-
Dividends Paid	(10.1)	(31.9)
Net (Decrease)/Increase in Cash/Cash Equivalents	(9.1)	1.6

■ Decreased working capital due to 2015 crop sales

■ FY16 Investing cash flows driven by:

• Orchard acquisitions $5.3m (FY15 $54.6m) Investment in cogen, new orchards in NSW, additional harvest and farm equipment and irrigation upgrades $28.6m

• Water $9.5m

• Tree Development $4.4m

■ FY16 Investing cash flows and Debt reduction funded by:

• Proceeds from asset sales $73.2m (sale and leaseback and WA land sale)

■ Capex - FY17

• Complete Projects – H2E(Cogen), Parboil (ValueAdded Almond production facility)

• Continued upgrade of irrigation infrastructure Investment in growth phase of younger trees

Record operating cash flow

11

Almond Division

Almond Division ($m)	FY15	FY16
Underlying EBIT	87.5	36.1

Financials

• Volume: FY16 crop volume est. 14,200 tonnes (FY15 14,500 tonnes) - down 2% - up on guidance

• Processing: Hulling & shelling complete mid-August

• 2015 Crop : Returns A$4m down

• Price: FY16 price est. A$8.08/kg (FY15 A$11.45/kg) – down 29%

• Avge. FY15 AUD/USD Rate = 0.72 (FY15 0.77)

• 76% of 2016 crop sold.

Highlights

• Night harvest and favourable conditions resulted in faster harvest

• Sale and leaseback - 3 properties to First State Super (FSS) for A$64.0 million

• Greenfield plant out - 2,084 acres (with FSS) in July 2016

• FSS acquired 2 additional properties for SHV to lease & develop greenfield plantings

• 2017 & 18: plant out 1,000 acres

• Dryness of crop resulted in lower productivity in processing

• Tree health – continues to improve as nutrient program takes effect

80% of orchard is in sweet spot – substantial, long term, cash generation has commenced

12

Almond Division

==> picture [346 x 260] intentionally omitted <==

==> picture [368 x 260] intentionally omitted <==

17 August 2016 – the trees are in very good health and responding well to high performance program – 2017 bud potential looks strong

13

Food Division

Food Division ($m)	FY15	FY16
EBIT	6.8	10.3

Financials

• Revenue of A$161.8 million was up 16.6% (FY15 A$138.8 million)

• Improved sales mix driven margin improvement

• Industrial sales up 17%

• Branded Consumer sales – up 10%

Highlights

• Industrial sales - Aligning to key regional industrial customers has delivered growth

• New Product Development (NPD) represent 13% of sales

• Record Lucky Cooking Market share - July 2016 MAT 42.3 % vs 40.1% last year MAT

• Export – Continued to grow in both divisions

• Trading - Astute trading in volatile market has delivered profit gains

Strong performance – ahead of strategy

14

Food Division

==> picture [97 x 156] intentionally omitted <==

==> picture [97 x 157] intentionally omitted <==

==> picture [97 x 156] intentionally omitted <==

==> picture [103 x 161] intentionally omitted <==

==> picture [105 x 157] intentionally omitted <==

==> picture [102 x 157] intentionally omitted <==

==> picture [155 x 164] intentionally omitted <==

==> picture [99 x 154] intentionally omitted <==

==> picture [100 x 153] intentionally omitted <==

==> picture [97 x 149] intentionally omitted <==

Select continuing to release new and improved products

15

Market Outlook

• Demand remains strong for both Almond and Food division

• Consumers continue to see the benefits of all super foods with new product development remaining buoyant

• Consumers and industry committed to consuming less sugar, preferring Green & Clean alternatives

• Research continues to support increase consumption of almonds and other plant products to:

• Improve heart health

• Combat diabetes

• Improve cognitive function

• Reduce mortality

• Increase fertility

• Assist weight control

• Land and water remain are a finite resource

• Asian middle class continues to be a strong driver of future demand

See positive signs with demand increasing

16

Almond Market Outlook

Demand

• New product development activity remaining buoyant. Almond Milk and Butters continue to grow

• www.dairyreporter.com/Markets/Dairy-alternatives-market-to-reach-19.5bn- ~~b~~ y-2020

• Despite economic malaise Asia middle class will continue to grow

• Competitive nuts reset to historical norm, stimulating almond growth

• Recent US shipment data shows extremely strong export demand

• US domestic market starting to respond to lower prices

Supply

• Recent lower volatile lower pricing and cost pressures will cause slow down in new plantings and continued removals in US

• US harvest has commenced over the last couple of weeks. The USDA is forecasting a crop 10% larger than last year. 2.1 Bn lbs, with a slightly higher year on year carryover stock of approx. 0.42 Bn lbs

• Despite improved conditions year to date, the US drought continues. Long range forecast for a drier than normal winter

• Recent new announced plantings in Australia will not impact global environment

Price

• Currency continues to impact price for SHV

• Last year’s price volatility has resulted in buyers being unwilling to make long term commitments

• Market pricing will remain uncertain until US crop volume has been confirmed, current forecast USDA appears valid

• SHV is not active in the market

See positive signs with demand increasing

17

Almond Market Outlook – US Shipments 2015/16

2014/15 2015/16 (million lbs) (million lbs) US Export Shipm	Growth (%) ents	2014/15 2015/16 Growth 2014/15 2015/16 (million lbs) (million lbs) (%) (million lbs) (million lbs) US Domestic Shipments Total US Almond Sh	Growth (%) ipments
Last 12 months 1,173.1 1,218.0	104%	639.4 593.2 93% 1,812.5 1,811.2	100%
Last 9 months 827.6 941.4	114%	476.2 438.1 92% 1,303.2 1,379.5	106%
Last 6 months 571.3 672.8	118%	322.8 301.5 93% 894.1 974.3	109%
Last 3 months 254.4 332.9	131%	158.5 157.8 100% 412.9 490.7	119%

Source: Almond Board of California Position Reports

Increasing US shipments relative to prior periods are gaining pace

18

Select Harvests Update

• The 2017 crop has had sufficient chill hours and is now at the pollination stage of the lifecycle

• Bees are in place and we anticipate a strong bloom with good crossover

• We can see the benefit of new horticultural programs - the 2017 bud potential looks strong

• At this very early stage we estimate a 2017 crop in excess of 15,000 MT

• Water availability and pricing outlook is positive, temp price now below $150/ML

• Food Division has a more stable base for growth

• Increased focus on cost and productivity

SHV FY17 Crop estimated to be in excess of 15,000 tonnes

19

Productivity Improvements

• Improve Yield

• Improve Mix

• Improve On-Farm practice

■ Improve Transport and Handling

• Asset Utilisation

■ Cost-out Capex – Project Parboil, Project H2E

Business focus to drive better productivity from base

20

Significant Organic Volume Growth

80% of current planted acres are cash generative

==> picture [495 x 325] intentionally omitted <==

Current plan is fully funded and no additional processing investment required

21

SHV 2016/7 Business Objectives

1. Zero Harm OH&S strategy

2. Improve average mature tree yield

3. Acquire orchards at the right price

4. Grow and strengthen Food Business

5. Implement Greenfield program

6. Implement Biomass/Cogen plant

7. Implement Parboil

8. Implement 1Select ERP platform

9. Maintain Balance Sheet & Cash Flow strength whilst growing

10. Improve asset productivity & reduce cost

A world class, growing and funded, fully integrated Australian based, export food business – almond orchards, processing, trading, brands, exports

22

Strategy - Planning for Excellence & Growth

1. CONTROL CRITICAL MASS OF ALMONDS

Secure the critical mass of nuts needed to maximize profitability and leverage the global almond opportunity.

2. IMPROVE YIELD & CROP VALUE

Improve yield and overall crop value by perfecting on-farm and farm to factory practices .

3. BE BEST IN CLASS SUPPLY CHAIN

Continuously improve our supply chain, achieving high quality, low cost and optimum capital utilisation.

4. INVEST IN INDUSTRIAL & TRADING DIVISION

Allocate resources to leverage our trading skills and grow sales in the industrial channel .

5. STRENGTHEN PACKAGED FOOD BUSINESS

Commit funds and develop structure to generate domestic and export growth for the packaged food business delivering sustainable returns above the cost of capital .

6. FIX OUR SYSTEMS & PROCESSES

Develop the business systems and processes required to be a global industry leader .

7. NON ORGANIC GROWTH

Acquire businesses in related categories leveraging existing capabilities that are EPS accretive and deliver sustainable returns above our cost of capital.

8. ENGAGE WITH OUR PEOPLE & OUR STAKEHOLDERS

Engage with investors and our industry while developing the team required to be a global industry leader.

We have a clear strategy – execution has delivered growth and productivity

23

Thank you

Please direct any queries to:

Paul Thompson	Paul Chambers	Andrew Angus
Managing Director	Chief Financial Officer	Investor Relations
+61 3 9474 3544	+61 3 9474 3544	+61 402 823 757
Please note that background material/data regarding the global almond industry can be found on the		Select Harvests website - www.selectharvests.com.au

==> picture [243 x 152] intentionally omitted <==

==> picture [248 x 152] intentionally omitted <==

==> picture [231 x 152] intentionally omitted <==

24

Select Harvests - Financial History

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 SHV Historical Summary Units*	2016
Total Sales (A$M) 217.9 229.5 224.7 248.6 238.4 248.3 251.3 191.1 188.1 223.5 EBIT (A$M) 38.4 40.5 27.1 26.8 26.0 15.4 19.6 37.7 31.3 89.6 EBIT Margin (EBIT/Sales - %) (%) 17.6% 17.6% 12.1% 10.8% 10.9% 6.2% 7.8% 19.7% 16.6% 40.1% PBT (A$M) 37.9 40.0 25.4 23.0 23.6 12.0 13.4 32.7 26.8 84.3 NPAT (A$M) 26.5 28.1 18.1 16.7 17.3 8.9 9.5 22.9 21.6 59.4 Issued Shares No. of Shares 39.7 38.7 39.0 39.5 39.8 56.2 56.8 57.5 58.0 71.4 Earnings Per Share (AUD Cents per Share) 67.1 71.0 46.7 42.6 43.3 17.0 16.8 40.1 37.5 86.8 Dividend per Share (AUD Cents per Share) 53.0 57.0 45.0 12.0 21.0 13.0 8.0 12.0 20.0 50.0 Payout Ratio (%) 80.0% 80.0% 96.7% 28.2% 48.5% 76.5% 47.6% 29.9% 53.3% 57.6% Net Tangible Assets per Share (A$/Share) 1.83 1.57 1.41 1.56 1.87 2.17 2.19 2.14 2.38 3.35 Net Interest Cover (times) 82.3 75.8 15.6 7.1 10.7 4.5 3.2 7.5 7.0 16.9 Net Debt (A$M) 1.3 1.6 46.8 52.4 45.0 73.1 66.8 79.3 94.8 115.6 Shareholder Equity (A$M) 101.5 95.5 94.1 100.9 113.6 168.8 160.3 159.5 175.4 287.4 Net Debt to Equity Ratio (%) 1.3% 1.7% 49.7% 51.9% 39.6% 43.3% 41.7% 49.7% 54.1% 40.2% Share Price (A$/Share) 13.02 11.60 6.00 2.16 3.46 1.84 2.40 3.90 5.14 11.00 Market Capitalisation (A$M) 517.0 449.4 234.1 85.4 137.6 103.5 120.0 224.3 298.1 785.4 P/E Ratio 19.5 16.0 12.9 5.1 8.0 11.6 12.6 9.8 13.8 13.2	285.9
	41.3
	14.4%
	35.8
	27.9
	72.9
	38.5
	46.0
	119.5%
	3.22
	7.5
	67.3
	290.9
	23.1%
	$6.74
	491.5
	17.6

• 2014 figures have been rebased according to early adoption of Accounting Standards, AASB 116, Property, Plant and Equipment, and AASB 141, Agriculture, impacting “bearer plants”. 2011-2016 figures represent underlying earnings .

Source: Company Data

25

Food Division - Brands

==> picture [127 x 69] intentionally omitted <==

• Market leader in the cooking nut category. Value share 43.6 % as at 19 April 2016.

• Cooking Nut product range: almonds, walnuts, cashews, hazelnuts, brazil nuts, pine nuts, pistachios, macadamias, sunflower seeds and pepitas (Snacking product range: portion control packs, Lucky Smart Snax and Lucky Snack Tubs.

• Distribution: major supermarkets and export markets including the Middle East, Indonesia and Papua New Guinea.

==> picture [70 x 54] intentionally omitted <==

==> picture [58 x 36] intentionally omitted <==

==> picture [74 x 43] intentionally omitted <==

==> picture [112 x 59] intentionally omitted <==

• Product range: nuts, dried fruit, legumes and pulses, cereals, grains, seeds, flour, muesli and organic foods.

• Bulk and convenient packs.

• Distribution: health food stores and pharmacies nationally.

==> picture [39 x 56] intentionally omitted <==

==> picture [40 x 56] intentionally omitted <==

==> picture [39 x 56] intentionally omitted <==

==> picture [90 x 56] intentionally omitted <==

==> picture [95 x 64] intentionally omitted <==

==> picture [109 x 58] intentionally omitted <==

• Product range: muesli, dried fruit, nuts and snacks.

• Distribution: major supermarkets (muesli) and export markets including Hong Kong, Singapore, Malaysia , Indonesia and the Pacific Rim.

• Product range: muesli, dried fruit, wholefoods, nuts and snacks.

• Distribution: Health aisle of major supermarkets and export markets including Hong Kong, Singapore, Malaysia, Indonesia and the Pacific Rim.

• Product range: almonds and other nuts, dried fruit, seeds, nut pastes and pralines.

• • Bulk pack.

• Products sold to local and overseas food manufacturers, wholesalers, distributors and re-packers.

==> picture [104 x 63] intentionally omitted <==

==> picture [46 x 72] intentionally omitted <==

==> picture [46 x 71] intentionally omitted <==

==> picture [44 x 69] intentionally omitted <==

==> picture [108 x 57] intentionally omitted <==

Portfolio of Consumer and Industrial Brands to service the Growing Australian and Asian Demand for Source: Company Data and Aztec National Chains Scan data Heathy, Value based Food with Australian Provenance

26

Project Parboil – Almond Value-Add

Projective Objective: To install an Added Value Almond Processing & Packing Facility at Carina West

==> picture [403 x 227] intentionally omitted <==

Infrastructure designed using and comply to:

WQA Manufactured Food Standard Version8

&

Coles Food Manufacturing Supplier Requirements (CFMSR) ver Feb 2014

Specifications

Operational Highlights

• Building size: 50m x 84m

• Integrated Processing Equipment: Blanching, Slivering, Slicing, Dicing, Dry Roasting, Pasting, Grinding, Pasteurising, Electronic Sorting and Industrial & Retail Packing

• 1.2m concrete tilt slab perimeter internal/external

• Borrell Integrated Blanching & Roasting Line

• Nimbus Electronic Sorter with Biometric Signature Identification

• Climate Controlled Factory, Cool Store Warehousing

• Propac Retail Baggers AV 2.2 with Dual Feed system

• Automated Industrial Packing Line with Gas Flushing

• Pattyn Fully Automated Industrial Packaging Line

• Climate Controlled Factory, Cool Store Warehousing

• Ishida Multi-Head & Check Weighers

• Operational Hours: 8hrs x 5 days x 48 weeks

• Visy Automation Robotic Retail & Industrial Palletizing line

• Operators Employed: 12

• 2mt per hour thru-put

• Capital Investment: $11m AUD

• Installation – Q2 2016

27

Operations - Project H2E – Hull to Energy

Project Overview: Biomass boiler and steam turbine, fuelled by almond hull and shell converting it to heat and power. Abating 24000 tonnes* of greenhouse gas.

==> picture [650 x 279] intentionally omitted <==

*Internal estimate

Reduces energy cost by 20%, enhancing Carina West’s position as a global low cost processor

28

Almond Orchards – Our productive foundation

• Geographic diversity limits exposure to: − Weather

• − Disease spread

• − Insect infestation

Enables sequential progression of harvest period across regions: − Better farm equipment utilisation − Better processing utilisation − Better labour utilisation

==> picture [445 x 302] intentionally omitted <==

Secure access to diverse water sources:

• River Water

• − Aquifers

Positions the company to maximise harvest volume & reduce variance.

Building world class properties and a globally competitive low cost business.

Australia’s 2[nd] largest & most geographically diverse almond producer – 16,521 planted acres

Growth – 1,000 acres to be planted in July 2017 & 2018 – Funded by 3[rd] party

29

Select Harvests – Orchard Profile

Select Harvests Planted Under Development Total Planted	Select Harvests Planted Under Development Total Planted	Select Harvests Planted Under Development Total Planted	Select Harvests Planted Under Development Total Planted
Almond orchard portfolio (as at 30 June 2016) (as at 30 June 2016) (as at 26 August 2016)
Acres Hectares Acres Hectares Acres Hectares
Central region Company Owned Leased	3,852 1,559 1,481 599	310 125 1,443 584	4,162 1,684 2,924 1,183
Total Central	5,333 2,158	1,753 709	7,086 2,868
Northern Region Company Owned Leased	1,691 684 3,017 1,221	107 43	1,798 728 3,017 1,221
Total Northern	4,708 1,905		4,815 1,949
Southern Region Company Owned Leased	1,574 637 2,405 973	641 259	1,574 637 3,046 1,233
Total Southern	3,979 1,610	641 259	4,620 1,870
Total Company Owned Leased	7,117 2,880 6,903 2,794	417 169 2,084 843	7,534 3,049 8,987 3,637
Total	14,020 5,674	2,501 1,012	16,521 6,687

30

Select Harvests – Orchard Age Profile

==> picture [542 x 357] intentionally omitted <==

Significant growth & improvement occurred in SHV orchard portfolio in recent years - acquisition, replants, greenfields

31

Almond Pricing over a 10 year crop period (AUD)

==> picture [616 x 305] intentionally omitted <==

----- Start of picture text -----

Almond Price Nonpareil SUP 23/25 (AUD/kg)
(AUD/kg) - LHS Historical Rolling Average AUD/kg - LHS 5 Year Rolling Average AUD/kg - LHS
Rollng Average USD vs AUD - RHS Linear ((AUD/kg) - LHS)
$14.00 $1.00
$0.90
$12.00
$0.80
$10.00 $0.70
$0.60
$8.00
$0.50
$6.00
$0.40
$4.00 $0.30
$0.20
$2.00
$0.10
$- $0.00
Mar-07 Mar-08 Mar-09 Mar-10 Mar-11 Mar-12 Mar-13 Mar-14 Mar-15 Mar-16
(AUD/kg) - LHS $7.95 $5.63 $6.30 $6.46 $4.69 $5.45 $7.45 $10.02 $12.42 $7.20
Historical Rolling Average AUD/kg - LHS $7.95 $6.79 $6.63 $6.59 $6.21 $6.08 $6.28 $6.74 $7.37 $7.36
5 Year Rolling Average AUD/kg - LHS $6.21 $5.71 $6.07 $6.81 $8.01 $8.51
Rollng Average USD vs AUD - RHS $0.7880 $0.8546 $0.7982 $0.8287 $0.8749 $0.9008 $0.9192 $0.9162 $0.9004 $0.8854
----- End of picture text -----

• This is internal company data. Please note this is a reflection of one nut variety & size, not the total pool return

The combination of currency and price has caused the sharpest price correction in recent history

32

Almonds competitively priced against other tree nuts

==> picture [553 x 315] intentionally omitted <==

----- Start of picture text -----

Tree Nut Spot Pricing March 2010 vs March 2015 vs March 2016
(USD/lb)
Averaged March 2016 Averaged March 2015 Averaged March 2010
$2.50
Almond $4.55
$2.42
$3.65
Hazelnut $6.80
$2.80
$4.75
Roasted & Salted
$5.35
Pistachio
$3.95
$3.80
Brazil Nut $3.60
$2.40
$3.60
Cashew $3.35
$3.37
$2.55
Walnut $4.65
$3.61
$- $1.00 $2.00 $3.00 $4.00 $5.00 $6.00 $7.00 $8.00
----- End of picture text -----

==> picture [150 x 40] intentionally omitted <==

Almond pricing relativity has been restored to historic norms

33

Select Harvests – Horticultural Costs

==> picture [520 x 381] intentionally omitted <==

34

US Almond Production - Ageing

==> picture [437 x 303] intentionally omitted <==

Source: USDA NASS, 2016 California Almond Forecast Report, 10 May 2016

38% of California’s total Almond Orchard Acreage is more than 21 years old

6% of Select Harvests total Almond Orchard portfolio is over 21 years old

35

US - Groundwater Depletion Concerns

==> picture [277 x 330] intentionally omitted <==

Purple Shading = Critically Overdrafted Groundwater Basins

==> picture [415 x 251] intentionally omitted <==

Groundwater - Some of the biggest counties are reliant on critically overdrafted groundwater basins Dept of Water Resources has a well defined timeline to groundwater legislation and management

36

US Almond Production & Drought

14% - North Counties % of US Almond Prod’n

==> picture [238 x 276] intentionally omitted <==

==> picture [332 x 259] intentionally omitted <==

Orange States = Severe Drought 86% - South Counties % of US Almond Prod’n Red States = Extreme Drought Dark Brown States – Exceptional Drought

Drought situation is much improved on 2015

37

Useful Almond Industry Websites

■

Industry Associations

• ─ Californian Almond Board

www.almondboard.com

• ─ United States Drought Monitor

• ─ Dept. of Water Resources (DWR) – Reservoir Levels

• ─ DWR – Snowpack Levels

• ─ DWR – Critically Overdrafted Groundwater Basins (2016)

• Industry Reports

• ─ US Crop Forecasts (Subjective, Objective)

• ─ Monthly Almond Position Reports

• ─ Almond Almanac

• ─ UC Davis Almond Development Costings

http://droughtmonitor.unl.edu/Home/StateDroughtMonitor.aspx?CA http://cdec.water.ca.gov/cdecapp/resapp/getResGraphsMain.action http://cdec.water.ca.gov/cdecapp/snowapp/sweq.action http://www.water.ca.gov/groundwater/sgm/pdfs/GW_basinsCriticalOverdraft_CA.pdf http://www.almonds.com/growers/resources/crop-forecasts http://www.almonds.com/newsletters/position-reports?from-section=2881 http://www.almonds.com/sites/default/files/content/attachments/2015_almanac.pdf http://coststudies.ucdavis.edu/en/current/

■ Almond Companies

• ─ Blue Diamond Growers

www.bluediamond.com

• ─ Blue Diamond Ingredients

www.bdingredients.com/category/almond-market-analysis

• ─ Almond Insights

www.almondinsights.com

• ─ Derco Foods

www.dercofoods.com/en/reports

• ─ RPAC Almonds

www.rpacalmonds.com/marketnews

• ─ Paramount Farms

www.paramountfarms.com

• ─ Hilltop Ranch www.hilltopranch.com

• ─ Merlo Farming www.merlofarminggroup.com

38

Thank you

Please direct any queries to:

Paul Thompson	Paul Chambers	Andrew Angus
Managing Director	Chief Financial Officer	Investor Relations
+61 3 9474 3544	+61 3 9474 3544	+61 402 823 757
Please note that background material/data regarding the global almond industry can be found on the		Select Harvests website - www.selectharvests.com.au

==> picture [243 x 152] intentionally omitted <==

==> picture [248 x 152] intentionally omitted <==

==> picture [231 x 152] intentionally omitted <==

39