FRASER AND NEAVE, LIMITED & SUBSIDIARY COMPANIES ANNUAL REPORT 2018

CORE MARKET BEVERAGES BUILDING A SUSTAINABLE FUTURE

BEVERAGES MALAYSIA: for its soft drinks plant in Soft Drinks and No.1 Isotonic RESULTS Shah Alam, it expanded its Drink. As the first isotonic drink Despite the overall declining water plant by installing a launched in Malaysia some soft drinks market trend, 600bpm water line, adding 30 years ago, to remain FY2018 marked a turnaround a combi blow, mould and relevant to today’s consumers, for the Beverages Malaysia filling machine, and more 100PLUS continued to reinvent business. This year, Beverages than doubling the capacity itself through innovation and Malaysia revenue was 1% of its Bentong mineral water renovation. Riding on the health higher while earnings surged plant. In addition, the newly- trend amongst consumers, over twofold, thanks to installed aseptic cold-fill PET 100PLUS has been actively lower sugar cost, favourable line at the Shah Alam plant taking part in the sugar foreign currency translation would also further accelerate reduction initiative. Through and positive effect of cost Beverages Malaysia’s careful reformulation, it has control. Key category expansion into new healthier successfully reduced its sugar market share grew as the offerings in the near future. content in its entire fruity range Group stayed focused and of 100PLUS (Orange, Berry, deployed resources to drive ISOTONIC: 100PLUS Lemon Lime and the new our core categories. Isotonic F&N’s flagship brand, Blackcurrant) and earned the and carbonated soft drinks 100PLUS, continued its reign HCS awarded by the Malaysia categories grew in part by the as Malaysia’s No.1 Carbonated Ministry of Health. It further introduction of new products introduced an even healthier and successful marketing option to its original family range strategies. – 100PLUS Reduced Sugar where it has only 4g of sugar This year, leading positions per 100ml, which is 33% less of the Group’s core #1 sugar than 100PLUS Original. brands – 100PLUS, F&N It also launched 100PLUS Sparkling Drinks, OYOSHI, ACTIVE in powder form in small F&N SEASONS and F&N convenient sachets in response NUTRISOY – were upheld as CARBONATED to consumers’ growing demand Beverages Malaysia remained for greater convenience and steadfast in marketing and SOFT DRINKS flexibility. branding initiatives, focused on promoting active and healthy 100PLUS’s continuous living. 100PLUS, for instance, involvement in sports, reinforced the importance of # including sponsorships of hydration while leading active 1 national athletes, major sports lifestyles by offering new events and several national reduced sugar variants, and sports bodies, underscores launching special packaging in its commitment to promoting conjunction with international ISOTONIC active and healthy lifestyles. sports events. It also continued This year, 100PLUS and the to lend support to Malaysian DRINK Badminton Association of athletes as well as regional and Malaysia (“BAM”) signed a national sports events. new two-year sponsorship agreement, extending a To support the Group’s partnership since 2003. expansion strategy, this year Under the new agreement, Beverages Malaysia, held 100PLUS has been named the through F&NHB, continued Official Beverage Sponsor for to build its capabilities and all BAM events and activities,

expand its capacity in key * As at September 2018 including the Malaysian Open growth areas. For instance, and the Malaysian Masters.

33 FRASER AND NEAVE, LIMITED & SUBSIDIARY COMPANIES ANNUAL REPORT 2018 CEO BUSINESS REVIEW - BEVERAGES CORE MARKET • Malaysia

ENTIRE 100PLUS RANGE IS NOW CERTIFIED WITH THE HEALTHIER CHOICE LOGO Endorsed by the Ministry of Health

More importantly, the new deal 100PLUS rolled out 100PLUS would see 100PLUS becoming DAY across major cities in the title sponsor for the Malaysia including Johor national junior circuit and the Bahru, Kuala Terengganu junior inter-state tournaments and Sungai Petani, leading over the next two years. up to the grand finale that was held in Bukit Jalil, Throughout the year, . 100PLUS 100PLUS also supported DAY covered a series of fun and organised several youth activities, including a 5km programmes and badminton Inflatable Obstacle Fun competitions, successfully Run, Zumba sessions and driving brand growth and a special audition in search strengthening equity. of local talent to join as 100PLUS ambassadors in a In addition to badminton, game challenge during the 100PLUS continued to grand finale in Bukit Jalil. In reach out and engage the addition, 100PLUS signed masses by supporting sports a five-year agreement with organisations and sports the Kuala Lumpur Sports events such as the National City (“KLSC”) as its Official Sports Council, the 100PLUS Beverage Partner. With the LIGA PREMIER MALAYSIA, partnership, 100PLUS, along and 100PLUS DAY. As a key with the other F&N beverages, advocate for physical activity are now exclusively available and active living in Malaysia, throughout the KLSC.

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Permanent 100PLUS-branded a fresh new look for its tea to reflect its evolution from drinks booths have also been range. F&N’s use of new being just delicious (“oishi” set-up at the main arenas. aseptic cold-fill technology in Japanese) to a taste that is The deal also included the allowed the brand to adopt a “beyond delicious” (“oyoshi” # creation of a 1,400-metre long trendier, slimmer and appealing in Japanese). Now produced 1 100PLUS-themed cycling PET bottle. Using the new with the new F&N state-of-the- track around the National technology, F&N SEASONS art aseptic cold-fill technology, Stadium. The sponsorships Tea is exposed to just the the unique blend tastes fresher of sporting events and right temperature during and better defined, providing READY-TO- sports organisations provide manufacturing to ensure its the brand with even more opportunities for 100PLUS taste is optimised for ultimate competitive differentiation. DRINK TEA to strengthen its fans’ freshness, thus retaining its connection with the brand. proposition as a healthier and flavourful refreshment TEA: F&N SEASONS AND with antioxidants that is OYOSHI preservative-free. F&N continued to command Malaysia’s RTD tea segment To further enhance its appeal with F&N SEASONS and and differentiate itself in a OYOSHI leading the RTD black crowded tea category, OISHI tea and green tea segments’ embarked on a rebranding awareness and consumption exercise with a new name and frequency, respectively. innovative packaging design INVESTMENT across its entire product Launch of new aseptic This year, F&N SEASONS range. As part of this exercise, cold-fill line * As at July 2018 improved its taste and unveiled OISHI was renamed OYOSHI

35 FRASER AND NEAVE, LIMITED & SUBSIDIARY COMPANIES ANNUAL REPORT 2018

CORE MARKET BEVERAGES BUILDING A SUSTAINABLE FUTURE

BEVERAGES SINGAPORE: wants. Understanding RESULTS the changing needs of Weak consumer sentiments, consumers, 100PLUS regulatory changes continued to provide healthier # and competitive price options with the launch of 1 environment continued to 100PLUS Zero Sugar in weigh down on Beverages March this year. Formulated Singapore’s FY2018 to contain zero sugar and performance. Due to zero calories, 100PLUS ISOTONIC lower domestic soft drinks Zero Sugar is the perfect volumes and poorer export healthier choice for everyday sales, Beverages Singapore consumption. saw its revenue dip 5%. Nevertheless, due to great To build awareness and marketplace execution, drive trial, 100PLUS rolled innovation and creative out its four-month long brand marketing, Beverages ZERO IN ON THE MOMENT Singapore continued to marketing campaign featuring gain market shares and celebrity couple, radio deejay maintained its market Kimberly Wang and actor SOYA leading positions in its core Shane Pow, to promote categories – 100PLUS in the new 100PLUS Zero isotonic, F&N NUTRISOY Sugar. Supported by various in soya and F&N ICE above-the-line marketing MOUNTAIN in water. activities which included Due to lower sales and higher radio, out-of-home, digital marketing cost, Beverages and in-store advertising, Singapore earnings fell. 100PLUS continued to excite consumers with this new Singapore remains one addition. of F&N’s key markets. This year, Beverages Singapore This year also saw a step- continued its emphasis on change in our digital product innovation, focusing marketing to respond to WATER on healthier beverages. It has changing consumer and expanded its portfolio with media trends. This included lower- or no- calories products the successful activation including 100PLUS Zero Sugar, of 100PLUS Zero Sugar F&N Orange Zero, F&N Sarsi #ZeroInSG and #100PLUSsg, Zero, F&N SEASONS White which bagged over 1.6 million Chrysanthemum Tea No Sugar YouTube views. and F&N NUTRISOY High Calcium Reduced Sugar Fresh To further drive awareness, Soya Milk with Walnut, all 100PLUS conducted endorsed as ‘Healthier Choice’ extensive sampling exercises by Singapore’s HPB. by deploying Hydration As a fervent advocate of active Champions on the city streets lifestyles, 100PLUS continued ISOTONIC: 100PLUS in the CBD area. Equipped its support of several major As Singapore’s No.1 with their trusty 100PLUS sporting events including the Isotonic brand, 100PLUS Zero Sugar drinks dispenser, OCBC CYCLE, STANDARD has always stayed ahead these Hydration Champions CHARTERED SINGAPORE of the curve by focusing on kept consumers refreshed MARATHON, SGX BULL consumers’ needs and and re-hydrated. CHARGE, THE COLOR RUN,

37 FRASER AND NEAVE, LIMITED & SUBSIDIARY COMPANIES ANNUAL REPORT 2018 CEO BUSINESS REVIEW - BEVERAGES CORE MARKET • Singapore

THE NEW PAPER BIG WALK, MOUNTAIN introduced a Zero are F&N innovations THE STRAITS TIMES RUN, 4x375ml multipack for its that boast the same great HSBC RUGBY SEVENS, SMBC growing sparkling water indulgent tastes as the regular SINGAPORE OPEN and the # range – F&N ICE MOUNTAIN range, without the sugar. WTA FINALS SINGAPORE. 2 Sparkling Water Classic and F&N ICE MOUNTAIN Sparkling As a brand synonymous with SOYA: F&N NUTRISOY Water Lemon. festive celebrations, F&N F&N NUTRISOY, Singapore’s Sparkling Drinks rolled out a No.1 Soya Milk brand, FLAVOURED F&N ICE MOUNTAIN also Chinese New Year-themed continued to raise visibility sponsored events to drive 24-can Healthier Choice Festive and awareness of its range CARBONATED brand awareness and Packs and limited-edition F&N of high calcium and low consumption. Some of the Sparkling Drinks lineup during glycemic beverages amongst SOFT DRINKS key events were the STAR Hari Raya. The Healthier consumers. This March, F&N WARS™ RUN Singapore Choice Festive Packs included NUTRISOY embarked on 2018, STRAITS TIMES the no-sugar F&N Orange Zero a three-month long MORE CONCERT IN THE GARDENS and F&N Sarsi Zero, as well THAN JUST FRESH SOYA and OSIM SUNDOWN as the reduced sugar variety GOODNESS nationwide MARATHON 2018. packs, F&N SEASONS Ice campaign to educate Lemon Tea Reduced Sugar consumers on the great TEA: F&N SEASONS and F&N SEASONS White taste and superior functional This year, F&N SEASONS Chrysanthemum Tea No Sugar. benefits of F&N NUTRISOY’s embarked on the SEASONS In addition to its existing range fresh soya milk drinks. REFRESH YOUR EVERYDAY of Hari Raya limited-edition Through various customer MOMENTS island-wide beverages, F&N Sparkling touchpoints – from outdoor campaign to sustain its top of Drinks also introduced to online advertisements, in- mind recall with consumers. store roadshows to point-of- Targeted at youth, the digital sales materials – this content campaign used Facebook, marketing successfully YouTube, static images and highlighted the additional 6-second videos to drive home nutritional benefits that F&N the health message. The NUTRISOY offers and drove videos successfully generated sales in the super/hyper over 4m impressions and channel. well over 1m YouTube views, boosting sales. NEW RANGE Responding to the nutritional needs of our consumers, Committed to helping OF 0% SUGAR F&N NUTRISOY expanded consumers make balanced its soya milk range with the diet choices, F&N SEASONS BEVERAGES introduction of the new F&N launched a sugar-free NUTRISOY High Calcium alternative to its best-selling Reduced Sugar Fresh Soya Asian drink flavour in Milk with Walnut in August. Singapore – F&N SEASONS The rollout was a success, White Chrysanthemum Tea supported by an integrated these events, F&N NUTRISOY No Sugar. Certified as a HPB marketing campaign conducted sampling of its Healthier Choice product, with various consumer omega range as well as the F&N SEASONS White touchpoints. reduced sugar range. Key Chrysanthemum Tea No benefits of F&N NUTRISOY, Sugar contains zero sugar and F&N NUTRISOY continued especially on Omega-3, sweeteners, with no added to be a main partner with were also highlighted and preservatives. Singapore Heart Foundation communicated to participants. (“SHF”) to promote F&N SPARKLING DRINKS heart health and educate WATER: F&N ICE MOUNTAIN F&N’s concerted efforts at Singaporeans on how to lead F&N ICE MOUNTAIN is sugar reduction has resulted a heart healthy lifestyle. This the No.1 Water brand in in the launch of its first sugar- year, it continued its support Singapore, led by its still free offerings for the leading through its sponsorship of drinking water range. To satisfy F&N Sparkling Drinks flavours SHF’s two key events – GO growing consumer demand for – F&N Orange Zero and F&N RED FOR WOMEN 2018 and convenience and to provide Sarsi Zero. The all new F&N WORLD HEART DAY 2018. At choices, this year, F&N ICE Orange Zero and F&N Sarsi

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F&N RETURNS TO WITH GREENFIELD BREWERY

F&N has formed a joint-venture with Sun Ace Company Corporation Limited (“SA”) and Than Lwin Aye Yar Industrial Production & Construction Co., Ltd (“TLAY”) to establish a greenfield brewery in Myanmar. In collaboration with our strategic partner, Thai Beverage Public Company Limited, the joint-venture will invest over US$50m in a greenfield brewery which will brew and market a portfolio of ThaiBev’s beer brands in Myanmar.

Approved by the Myanmar Investment Committee, as at 26 Nov 2018, F&N holds 79.3% of the new joint-venture company, Emerald Brewery Myanmar Ltd. The balance is held F&N Lychee Pear which to drive awareness for the by Myanmar-based SA (20.0%) and TLAY (0.7%). Under the contains 40% less sugar brand and create memorable terms of the agreement, F&N will be responsible for overall than the regular F&N range. moments for a mass sporting management, providing brewing and technical expertise, Certified Healthier Choice audience. These public procurement of ingredients and the licensing of brands. by the HPB, this low-sugar screenings which carried alternative was a great hit CHANG beer branding The brewery is located at the Hlegu Township in Yangon. amongst Singaporeans. ensured visibility across It is expected to be completed by end-2019 with an initial several venues in Singapore annual capacity of 500,000 hectolitres. BEER: CHANG and was a key touchpoint for CHANG beer kept up the brand. its brand building pace internationally with exciting Effective consumer activities based on the promotions, social media experiential marketing presence, eye-catching in- initiatives. This year, it store displays and outdoor organised transnational sampling at large-scale events activities, with core objectives encouraged consumer trials of engaging with consumers and improved brand visibility. in key global cities and The strong performance of broadening CHANG beer’s CHANG beer resulted in a following in these markets. positive volume growth for Building on last year’s the brand, as it continued its success, CHANG SENSORY focus on football, music and TRAILS was back for a Thai culinary experiences third year running. A global to reach a wider audience, campaign – across London, effectively boosting brand Los Angeles and Singapore awareness and consumption. – the CHANG SENSORY TRAILS sought to deliver ‘the unexpected’ by building a rich, multi-sensorial experience centred on Thai gastronomy, art and music.

As part of the broadcast sponsorship of the 2017/18 English Premier League in Singapore, CHANG organised a series of outdoor live viewing parties at iconic locations in the city state. Through these regular football screenings, CHANG beer continued

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