Strauss Group Financial Results

Q2 2023 Earnings Presentation | August 15th , 2023

Disclaimer

GAAP to Non-GAAP Reconciliations

This presentation does not constitute an offering to purchase or sell securities of Strauss Group Ltd. (the "Company") or an offer for the receipt of such offerings. The presentation's sole purpose is to provide information. The Information provided in the presentation concerning the analysis of the Company's activity is only an extract, and in order to receive a complete picture of the Company's activity and the risks it faces, one should review the Company's reports to the Israel Securities Authority and the Tel Aviv Stock Exchange.

The presentation may contain forward-looking statements as defined in the Israeli Securities Law, 5728-1968. All forward-looking statements in this presentation are made based on the Company's current expectations, evaluations and forecasts, and actual results may differ materially from those anticipated, in whole or in part, as a result of different factors including, but not limited to, changes in market conditions and in the competitive and business environment, regulatory changes, currency fluctuations or the occurrence of one or more of the Company's risk factors. In addition, forward-looking forecasts and evaluations are based on information in the Company's possession while preparing the presentation. The Company does not undertake any obligation to update forward-looking forecasts and evaluations made herein to reflect events and/or circumstances that may occur after this presentation was prepared.

In addition to reporting financial results in accordance with generally accepted accounting principles (GAAP), the Company provides non-GAAP operating results which include the results of jointly controlled entities as if they were proportionately consolidated. Strauss Group has a number of jointly controlled companies: the Três Corações joint venture (3C) - Brazil (a company jointly held by Strauss Group (50%) and by the São Miguel Group (50%) in Brazil), Sabra Dipping Company (a 50%/50% JV with PepsiCo in the U.S. and Canada), Strauss Frito-Lay Ltd. (a 50%/50% JV with PepsiCo Frito-Lay in Israel) and PepsiCo Strauss Fresh Dips & Spreads International (a 50%/50% JV with PepsiCo outside the U.S. and Canada).

In addition, non-GAAP figures exclude any share-based payments, mark to market of commodity hedging transactions as at end-of-period, other expenses or income and taxes referring to these adjustments.

Company Management believes that these measures provide investors with transparency by helping to illustrate the underlying financial and business trends relating to the Company's results of operations and financial position and comparability between current and prior periods. Management uses these measures to establish and monitor budgets and operational goals and to evaluate the performance of the Company. Please see the GAAP to non-GAAP reconciliation tables in the Company's MD&A Report for a full reconciliation of the Company's GAAP to non-GAAP results.

Shai Babad

Group CEO

H1 SUMMARY

WE ARE A LEADING FOOD AND BEVERAGE COMPANY

NIS 5,179M H1 Sales

NIS 219M H1 Net Profit

c18,000 Employees

11.9% Market Share Strauss Israel (1)

Platinum+ Maala Index Ranking

c20 Countries

cNIS 10B Market Cap

9 TOP 100 brands in Israel (Globes)

(1) Source: storenext

H1 SUMMARY

AND A DIVERSE GEOGRAPHICAL MIX

H1 SUMMARY

OUR FINANCIAL PERFORMANCE IS PROGRESSING ACCORDING TO OUR STRATEGIC PRIORITIES

H1 SUMMARY

OUR RTP MODEL HELPED US BUILD CLEAR STRATEGIC PRIORITIES RECOVER

TRANSFORM

PERFORM

Recovering businesses in our portfolio

H1 SUMMARY TRANSFORM

Continuing our journey to build unified operations and promoting ONE in Israel

Building a unified operations organization

Investing in our Food safety and quality

Finalizing centers of excellence in Israel in finance, HR and Operations

Strengthening our Consumer centricity to enable better solutions for our consumers

Boosting our digital transformation to enable agile and fast operations

Building infrastructure and systems to boost our resilience

PERFORM - GROWTH

Promoting future growth

Cutting edge innovation

Building internal infrastructure for innovation that will create future growth engines in several categories
New location in Rehovot
Gearing up for the FoodtechIL event in November

Global infrastructure Strategic initiatives

New Manufacturing Facility in China

• investment together with Haier Strauss Water in a new production facility in China

Strategy Review

• We are working on our strategy review

H1 SUMMARY

PUSHING FORWARD: OUR PLANS FOR Q3 2023

Strategy review	Focus on improving profitability	Building growth engines
FoodtechIL 2023 event	Digital transformation progress	ONE - Continue focus on Operations, finance and HR excellence
Enhancing ESG capabilities	Portfolio optimization	Continue boosting quality & safety

Ariel Chetrit

Group CFO

Q2 Highlights – Strauss Group

Strauss Group

Strauss Group posts net sales growth of 15.3% (+12.4% organic excluding FX effect) which was led by growth in Israel, mainly due to the return of confectionary to the shelves, and by Sabra's recovery in hummus sales
The group continues to face significant input inflation headwinds as green coffee, raw milk, sugar and packaging materials rose significantly, double digit, during the quarter
To combat profitability erosion, the Group implemented further productivity and efficiency measures among others
The NIS continued to weaken against major and other currencies during the quarter mainly the BRL and the USDwhich contributed NIS 58 million to sales

15 (1)Storenext – includes barcoded products only

Q2 Highlights

Strauss Israel

Strauss Israel sales grew by 15.6% in the quarter led by Confectionery (due to the recall last year) and dairy
Growthwas driven by a volume increase of 11.2% and a price increase of 4.4%
Strauss Israel raised prices twice during the quarter as a result of rising commodity prices and other input inflation
Health & Wellness segment grew 12.3% and EBIT grew 19.9% to NIS 77 million in the second quarter mainly due to dairy; profitability improved to 10.2% from 9.6% in the corresponding quarter
Fun & Indulgence segment posted an operating profit YTD of NIS 24 million due to Confectionery recovery butwas flat during the quarter
Confectionery market share continued to improve during the quarter and reached 23.6% in the second quarter compared to 21.3% in the first quarter

Q2 Highlights

Strauss Coffee

Sales increased by 7.1% in the second quarter, led by Romania and Poland and a positive FX effect
Sales in Brazil rose 2.4% mainly due to higher selling prices; EBIT declined due to higher green coffee prices, material costs and selling expenses
R&G market share in Brazil reached 33.8%, an increase of 1.1%
Coffee Israel sales declined 6.1% as competition intensifies and margins eroded due to higher green coffee prices, the NISweakness aswell as otherinput inflation
Brazil, Romania, Poland & Serbia posted strong sales growth mainly due to higher selling prices. Ukraine saleswere down by -15% due to population shrinking as a result ofthe Russian Ukrainewar
Positive FX translation effects on sales, mainly as a result ofthe strengthening ofthe BRL against the NIS

Q2 Highlights

International Dips & Spreads

Sabra sales continued to improve from the previous quarter trough, almost doubling as the company returns to full production
Sabra's operating loss amounted to USD3 million
Sabra's market share continues to improve and reached 40.8% in July, maintaining its #1 position

18 Note: HSW revenues are not included in Strauss water results; net income is added to Strauss water EBIT in Non GAAP management reports

Q2 Highlights

Strauss Water

Strausswater sales rose 2.2% during the second quarter
Input inflation headwinds along with the weak NIS continued to erode profit and profitability in Israel
Haier Strauss Water (HSW) sales grew 11.9% in local currency and net income rose an impressive 37.1%

Q2 Highlights

Growth and Innovation

The total fair value of the 24 portfolio companies of the Kitchen FoodTech Hub amounted to NIS 613 million at the end of the 2 nd quarter, compared to NIS 559 million as of June 30th 2022
The Kitchen FoodTech Hub 2.0 began to operate and has moved to its new offices in Rehovot

Financial Highlights Reported Non GAAP

Q2 2023

Q2'23 Sales: NIS 2,625mm; growth: 15.3%, Organic Sales growth: 12.4%

Q2'23 Gross margins: 31.9% (up 150 bps vs. Q2'22)

EBIT and EBIT margins: NIS 171mm (up 65.2%); 6.5% (up 200 bps vs. Q2'22)

Net income and net margins: NIS 85mm (up 21.3%); 3.2% (up 10 bps vs. Q2'22)

YTD 2023

YTD 2023 Sales: NIS 5,179mm; growth: 13.9%, YTD Organic Sales growth: 10.1%

YTD 2023 Gross margins: 32.4% (up 260 bps vs. YTD 2022)

EBIT and EBIT margins: NIS 379mm (up 84.6%); 7.3% (up 280 bps vs. YTD 2022)

Net income and net margins: NIS 219mm (up 94.5%); 4.2% (up 170 bps vs. YTD 2022)

Q2 2023

Sales

Q2 2023 Sales by Segment

NIS mm; Non-GAAP; % sales contribution

Q2 Sales Bridge NIS mm; Non-GAAP; Q2'22 to Q2' ²³

D&S

Gross Profit

Spreads

Q2 2023 Gross Profit and Gross Margins

NIS mm; Non-GAAP; % Margin

Q2 EBIT Bridge NIS mm; Non-GAAP; Q2'22 to Q2'²³

Q2 2023 EBIT and EBIT Margins NIS mm; Non-GAAP; % Margin

EBITDA

Q2'22

Três Corações Alimentos S.A. (Três Corações J.V.)

Q2 Snapshot | BRL mm for 100% ownership and including inter-company sales

Note: Três Corações joint venture (Brazil): a company jointly held by the Group (50%) and by the São Miguel Group (50%) (3C).

Source: Três Corações Alimentos S.A. Consolidated Interim Financial Statements as of June 30th , 2023.

Sabra Q2 Snapshot \$ mm; Non-GAAP; for 100% share

31 Note: Sabra Dipping Company ("Sabra") is a company jointly held by PepsiCo (50%) and Strauss Group (50%)

Sales

EBIT and EBIT Margins

Net Income

Q2 Net Profit (attributed to the Company's shareholders), Net Margins and EPS

Growth excl. FX ⁼

Net Income

Conf. & D&S

& Conf. & D&S

Net Debt and Net Debt / EBITDA (LTM)

Non-GAAP EBITDA, net debt includes partnerships; NIS mm

Q2 GAAP and Non-GAAP Financial Highlights, NIS mm

		GAAP		Adjusted Non-GAAP
	Q2 2023	Q2 2022	% Chg.	Q2 2023	Q2 2022	% Chg.
Sales	1,631	1,421	14.8%	2,625	2,276	15.3%
Gross Profit	587	502	16.8%	839	691	21.2%
GP Margin	36 0%	35 3%		31 9%	30 4%
Operating Profit	159	76	108.6%	171	102	65.2%
EBIT Margin	9 7%	5 4%		6 5%	4 5%
Net Profit (to SH)	73	55	31.6%	85	70	21.3%
Margin NP	4% 4	9% 3		2% 3	1% 3
Operating Cash Flow	59	120		61	140
Capex (1)	(101)	(76)		(127)	(99)
Net debt	2,431	2,086		2,977	2,455
Change in WC (CF)	(84)	(14)		(129)	(38)

Y TD 2023

YTD 2023 Sales by Segment

NIS mm; Non-GAAP; % sales contribution

Y T D Sales Br i dge NIS mm; Non-GAAP; YTD 2022 to YTD 2023

Gr o ss Pr of it

EBIT

Y T D 2023 EBI T and EBI T Mar gi ns

NIS mm; Non-GAAP; % Margin

YTD 2022

'23/'22

Organic

growth

excl. FX

EBIT &

EBIT %

EBI T DA

YTD'22

T r ês Cor ações Alimento s S. A. (Três Corações J.V.)

YTD Snapshot | BRL mm for 100% ownership and including inter-company sales

Note: Três Corações joint venture (Brazil): a company jointly held by the Group (50%) and by the São Miguel Group (50%) (3C).

Source: Três Corações Alimentos S.A. Consolidated Interim Financial Statements as of June 30th , 2023.

45 (*) EBIT before Other Expenses/ Income. Sales

EBIT and EBIT Margins

Sabr a Y T D Snapsho t \$ mm; Non-GAAP; for 100% share

Higher sales due to

Net Income

YTD Net Profit (attributed to the Company's shareholders), Net Margins and EPS

Net Income

YTD Net Profit (attributed to the Company's shareholders) Bridge

GP Margin 37.3% 32.8% 32.4% 29.8%

GAAP

Operating Profit	405	157	158.2%	379	204	84.6%
EBIT Margin	12 1%	4% 5		3% 7	5% 4
Net Profit (to SH)	304	69	339.8%	219	113	94.5%
NP Margin	9 1%	2 4%		2% 4	2 5%
Operating Cash Flow	4	89		(165)	16
Capex (1)	(157)	(135)		(201)	(176)
Net debt	2,431	2,086		2,977	2,455
Change in WC (CF)	(350)	(103)		(618)	(285)

Sales 3,344 2,932 14.1% 5,179 4,548 13.9%

Gross Profit 1,247 961 29.8% 1,676 1,353 23.8%

Y TD GAAP and Non-GAAP Financial Highlights, NIS mm

Adjusted Non-GAAP

YTD 2023 YTD 2022 % Chg. YTD 2023 YTD 2022 % Chg.

Currencies

Change in average exchange rate (1 local currency = x NIS)

Local Currencies vs. the NIS Local Currencies vs. the USD

Change in average exchange rate (1 local currency = x USD)

Str au ss I sr ael Non-GAAP Financial Highlights Q2 and YTD 2023 NIS mm

Strauss Israel (Non GAAP)
	Q2 2023	Q2 2022	% Chg.	YTD 2023	YTD 2022	% Chg.
Revenue:
H&W	754	672	12.3%	1,497	1,341	11.7%
F&I	217	101	115.1%	523	407	28.6%
Total Revenue	971	773	25.7%	2,020	1,748	15.6%
Total Gross Profit	346	253	36.7%	715	505	41.5%
Gross Margins	35 7%	32 8%	2 9%	35 4%	28 9%	6 5%
EBIT:
H&W	77	64	19.9%	162	146	10.7%
Margins	2% 10	6% 9	6% 0	8% 10	9% 10	(0 1%)
F&I	--	(75)	99.2%	24	(172)	113.7%
Margins	(0 3%)	(74 4%)	1% 74	5% 4	(42 4%)	9% 46
Total EBIT	77	(11)	808.2%	186	(26)	812.5%
Margins	9% 7	(1 4%)	3% 9	2% 9	(1 5%)	7% 10
EBITDA:
H&W	101	88	15.5%	210	192	9.4%
Margins	5% 13	1% 13	4% 0	0% 14	3% 14	(0 3%)

F&I 18 (59) 129.2% 60 (138) 142.8% Margins 8.0% (58.7%) 66.6% 11.3% (34.1%) 45.4% Total EBITDA 119 29 316.3% 270 54 403.2% Margins 12.2% 3.7% 8.5% 13.3% 3.1% 10.3%

Target Milk Prices| 2012-2023 (ILS per Liter)

London Sugar Historical & Futures Prices | 2017-2023 (\$\T)

London Cocoa Historical & Futures Prices | 2017-2023 (GBP\T)

Strauss Coffee Non-GAAP Financial Highlights Q2 and YTD 2023 NIS mm

Strauss Coffee (Non GAAP)
	Q2 2023	Q2 2022	% Chg.	YTD 2023	YTD 2022	% Chg.
Revenue:
Israel	169	180	(6.1%)	407	395	3.0%
International	1,148	1,050	9.3%	2,099	1,831	14.6%
Total Revenue	1,317	1,230	7.1%	2,506	2,226	12.6%
Total Gross Profit	357	360	(1.2%)	699	655	6.6%
Gross Margins	1% 27	3% 29	(2 2%)	9% 27	4% 29	(1 6%)
EBIT:
Israel	14	20	(33.5%)	53	67	(22.4%)
Margins	8 2%	11 6%	(3 4%)	12 9%	17 2%	(4 2%)
International	77	107	(27.7%)	137	165	(17.1%)
Margins	6 7%	10 2%	(3 5%)	6 5%	9 0%	(2 5%)
Total EBIT	91	127	(28.7%)	190	232	(18.6%)
Margins	9% 6	4% 10	(3 5%)	6% 7	5% 10	(2 9%)
EBITDA:
Israel	25	31	(22.8%)	75	87	(14.9%)
Margins	14 6%	17 8%	(3 2%)	18 4%	22 2%	(3 9%)
International	100	128	(21.6%)	182	205	(11.2%)
Margins	8 7%	12 2%	(3 5%)	8 7%	2% 11	(2 5%)
Total EBITDA	125	159	(21.8%)	257	292	(12.2%)
Margins	5% 9	0% 13	(3 5%)	2% 10	1% 13	(2 9%)

57 Source: Três Corações Alimentos S.A. Consolidated Interim Financial Statements as of June 30th , 2023

Str au ss Cof f ee Non-GAAP Sales by Geography Q2 and YTD 2023 NIS mm

Strauss Coffee Sales
			% Change				% Change
	Q2 2023	Q2 2022	NIS	Local Currency	YTD 2023	YTD 2022	NIS	Local Currency
Israel	169	180	(6.1%)	(6.1%)	407	395	3.0%	3.0%
International:
Três Corações Joint Venture (Brazil) (1)	783	705	11.1%	2.4%	1,404	1,264	11.1%	1.7%
Russia & Ukraine	171	191	(10.7%)	4.2%	336	283	18.5%	22.5%
Poland	90	71	25.9%	10.9%	169	135	25.2%	14.6%
Romania	60	48	26.2%	12.7%	111	86	29.2%	18.1%
Serbia	44	35	25.8%	12.6%	79	63	25.4%	14.8%
Total International	1,148	1,050	9.3%	4.2%	2,099	1,831	14.6%	6.7%
Total Coffee	1,317	1,230	7.1%	2.7%	2,506	2,226	12.6%	6.1%

Note: (1) Três Corações joint venture (Brazil): a company jointly held by the Group (50%) and by the São Miguel Group (50%) (3C).

58 Source: Três Corações Alimentos S.A. Consolidated Interim Financial Statements as of June 30th , 2023

YTD 2023 Strauss Coffee EBIT & EBIT Margins

Arabica Historical & Futures Prices | 2017-2023 (C\Lbs.)

Robusta Historical & Futures Prices | 2017-2023 (\$\T)

International Dips & Spreads

Strauss D&S Non-GAAP Financial Highlights | Q2 and YTD 2023 NIS mm; 50% share

		Dips & Spreads (Non GAAP)
	Q2 2023	Q2 2022	% Chg.	YTD 2023	YTD 2022	% Chg.
Revenue:
Sabra (50%)	116	54	113.7%	221	151	46.3%
Obela (50%)	17	20	(11.9%)	39	41	(5.8%)
Total Revenue	133	74	80.1%	260	192	35.1%

EBIT:
Sabra (50%)	(5)	(28)	(81.8%)	(6)	(43)	124.4%
Margins	(4 4%)	(52 0%)	6% 47	(2 9%)	(28 6%)	7% 25
Obela (50%)	(4)	(3)	NM	(4)	(5)	NM
Margins	NM	NM	NM	NM	NM	NM
Total EBIT	(9)	(31)	NM	(10)	(48)	(79.3%)
Margins	(6 8%)	(42 5%)	35 7%	(3 9%)	(25 2%)	21 3%

EBITDA:
Total EBITDA	(3)	(22)	90.7%	4	(32)	113.9%
Margins	(1 5%)	(29 4%)	8% 27	7% 1	(16 7%)	4% 18