Annual Review 2018

® Market Gardeners Limited Annual Review 2018 Annual Review 2018 Review Annual MG’s core purpose is to Contents grow the overall wealth and profitability of the Co-operative, Chairman & CEO's Review 02 ®

Financial Highlights 06 Together. Stronger. its shareholders and growers Income & Cash Flow Statements 28 Balance Sheet 29 through relevant initiatives Branch Register, Bank & Advisors 31 while maintaining co-operative principles .®Together. Stronger.

RESILIENCE VALUE CO-OPERATIVE Show true leadership to grow Keep reviewing the benefits our BEHAVIOUR the business and overcome grower shareholders receive Work hard together to make challenges by making decisions while finding new and relevant sure the benefits of our that protect the future of our ways to add value. Co-operative model drive grower Co-operative and make growth, value, trust and a sure the benefits are enjoyed by willingness to work closely generations to come. alongside each other.

PARTNERSHIPS GROWTH CAPABILITY Expand the level of Diversify and expand produce Continue to have the best communication to keep our lines locally as well as make our people, doing the right job, grower shareholders up-to-date Co-operative attractive to off- with the right tools to support and support a positive delivery shore markets so we can grow the wide range of needs of our of our shared vision, direction our export activity. grower network. and values.

We entered the 2018 financial year 2018 Review Annual full of anticipation that we could build on a great 2017. However, Annual Review 2018 the year has presented unforeseen challenges to the business to ®

which we have needed to adapt. impairment (reduction in the value Together. Stronger. The year has therefore ended with recorded for the brand and goodwill) and does not impact on our debt facilities or mixed results - a record result for compliance with banking covenants. This Together. Stronger. Together. is explained in more detail in the financial ® New Zealand but a disappointing section later in this review. outcome for Australia. We remain The combined trading profit, before confident that the strategic tax and impairment, and including the gain on acquisition, was $13.667 million initiatives of recent years well for the year, down from $16.018 million for positions your Co-operative for a the previous year. The vagaries of climate and other sound and sustainable future. disruptions are becoming the norm for the horticulture industry. We witness first-hand the vulnerability of growers and marketers, alike, to these variables and The New Zealand trading operations the need to develop sustainable farming recorded another strong performance practices in the long-term interest of with record turnover and profitability. the industry. These industry challenges Market share gains and generally good demonstrate, once again, the benefits values across a broad product range, of working together to meet the ever- together with tight management of discerning needs of our customers and

Chairman & expenses, have assisted in achieving this consumers – as a co-operative we are Bruce Irvine result. Our associates also performed ® Together. Stronger. It also demonstrates Chairman well and are in a good position for future the value of diversification across growth and profitability gains. countries and key categories.

CEO’s Review CEO’s The Australian market suffered from Today’s consumer is defining our depressed pricing with many product business like never before. They seek lines undervalued because of weak what were seasonal products on an demand, over production or, in some all year-round basis and continually cases, both. This impacted not only our look for better eating experiences. farming operations but the marketing Given traditional growing models, the divisions, resulting in a reduction of impact of the weather and the lead Peter Hendry revenue and a significant loss for the year. times associated with new varietal Chief Executive Officer The LaManna Premier Group (LPG) board development, this becomes a challenging and management teams recognised the proposition to deliver on. Our focus ongoing effect of weak market conditions remains on ensuring we are assisting and pricing throughout the year, and while our growers in meeting these consumer merger synergies had already assisted, demands by being an integrated part of further business improvements were their business, providing the necessary necessary. While these improvements support around planning to meet will take time to bed in, the Company is demand expectations, supporting with confident that an enhanced performance marketing insight on buying behaviour, will be achieved. The specifics of this meeting customer expectations and strategy are discussed in the LPG section the further enhancement through the of this review. use of Intellectual Property rights (IP). Given the difficult trading environment Successfully delivering on these key and trading loss in Australia, the board priorities creates competitive advantages has decided to take a $32.330 million that assist with the sustainability of ← Peter Collinge from Conifer Pete's impairment of the brand and goodwill our grower suppliers, our customer and Rob Hollier from MG Marketing. related to the business. This is a non-cash relationships and our Co-operative.

2 3 Our people are vital to delivering Co-operative, its shareholders and We remain confident that the 2018 Review Annual on these priorities. We continue to growers through relevant initiatives. work on attracting the right people Despite the setback this year, there strategic initiatives of recent years into our business and developing have been significant positives. Our well positions your Co-operative for Annual Review 2018 their capabilities within our cultural New Zealand operations continue to boundaries. It is essential that they are perform strongly and we are well placed a sound and sustainable future. philosophically aligned with the grower, for further growth. LPG is working hard

understand and deliver on customer on its business remodelling and the early ®

Together. Stronger. expectations, and have the skills to signs of improving performance create game-changing innovation. To this are encouraging. end, our capability to support this wide The Board remains focused on range of demands is a core focus of ‘our strategically positioning the company Together. Stronger. Together.

® people’ strategies. for future success and we thank the Information technology is also a Board members for their governance and critical component of our business leadership in the face of some significant success. Our current IT platform has industry-wide challenges. The Board’s served the business extremely well and engagement on the health, safety and will be phased out over the following wellbeing of our people is paramount and year with the new system currently our culture of care strategies are under under development. This will greatly constant review to achieve this goal. assist with further efficiency gains and We pay tribute to our prior Chairman improved flexibility to adopt new Brian Gargiulo’s service to the company digital technologies. later in this review - on behalf of the The use of smart technology and Board and management we thank Brian digital responses for business are also for his outstanding contribution to the necessary for efficiency gains, improved success of the Co-operative. communication and decision making. And finally, on behalf of the Board and A good example of this is MG’s Grower management team, we acknowledge and Delivery Advice (GDA) web portal which thank the support of all our stakeholders is now well established in the business, – our suppliers, customers and fellow with close to 60% of all growers using staff - as we work together to grow our the system and over 75% of all produce Co-operative for a stronger future. currently supplied now being pre- MG has operated now for 95 years and receipted online. has a proud history. We will continue to We will continue to strategically be creative, identifying new opportunities review and invest in growing operations, for our shareholders, grower suppliers joint ventures, partnerships and provide and customers, take controlled risks and grower financial assistance where this remain passionate about what we do. We strengthens the Co-operative and is in look forward to working with you all on line with our Co-operative principles, this endeavour in 2019. to grow the overall wealth of the ® Together. Stronger.

Bruce Irvine Peter Hendry Chairman Chief Executive Officer

4 5 Annual Review 2018 Review Annual Group gross sales under management $862.391 million 900 130.0 894.3 862.3 129.6 Annual Review 2018 Group profit before income tax 800 120.0 and impairment (including gain $13.667 million 700 110.0

107.1 ®

on acquisition) Together. Stronger. 103.1 600 590.3 588.7 100.0 Impairment of intangible asset 93.1 (goodwill and brand) ($32.330 million) 500 90.0 Together. Stronger. Together.

® 400 80.0 Group (loss) before income tax ($18.663 million) 2015 2016 2017 2018 2015 2016 2017 2018 Group gross sales under Group total equity ($M) management ($M) Group (loss) for the year (after income tax and impairment) ($19.502 million)

18 280 Group total equity 277.1 $107.147 million 262.7 16 16.0 260

14 240 Group total assets 13.6 $262.749 million 12 220

200 10 9.7 8.6 197.3

8 180 180.1

6 160 2015 2016 2017 2018 2015 2016 2017 2018 Financial Highlights Shareholder distributions 2018 2017 Group profit before income tax and impairment (including gain on Group total assets ($M) $’000 $’000 acquisition) ($M) – Special Bonus Issue (November 2018) • 1 for 20 on “A” shares (2017: 1 for 15) 976 1,172 • 1 for 5 on “B” shares (2017: 1 for 3) 1,666 2,518 12 11.6 7.5 6.87 • 1 for 2 on “C” shares (2017: 1 for 3) 442 331 7.2 6.51 6 5.8 6.0 • 1 for 20 on “D” shares (2017: 1 for 15) 155 190 5.53 5.59 0 4.5 – Supplier shareholder rebate (issued as 2018 250 250 (6) 2015 2018 “C” shares) (2017: issued as 2017 “C” shares) 2016 2017 3.0 (12) – Bonus issue on supplier shareholder rebate 750 750 1.5 of 3 for 1 (2017: 3 for 1) (18) – Final gross dividend on “A” shares : 1,171 1,125 (24) (19.5) 0.0

6 cents per share (2017: 6 cents per share) 2015 2016 2017 2018 – November 2018 - final gross dividend on 186 182 Group (loss)/profit for the year (after income tax Group distributions ($M) “D” shares: 6 cents per share (November and impairment) ($M) 2017: 6 cents per “D” share) Total shareholder distributions in relation to 5,596 6,518 the year ended 30 June

6 7 DISTRIBUTIONS 2018 Review Annual

Given the strength of the Company and that are Current Producers receive

Annual Review 2018 the strong results that have come from three further “C” shares for every one the NZ operations, the MG Board of “C” share they receive from the above Directors has resolved to return to its rebate). As imputation credits have shareholders significant distributions been attached to the bonus issue shares ®

Together. Stronger. totalling $5.596 million (2017: $6.518 they are mostly tax paid in the hands of million) by way of rebate shares, bonus the shareholder. issues and dividends. This is the fourth • Final dividend – a fully imputed taxable consecutive year that shareholders have gross dividend of six cents on every “A” Together. Stronger. Together.

® received a special bonus issue. share and six cents on every “D” share. On 7 September 2018 the Board Once again imputation credits are declared the following distributions in attached to this dividend. relation to the year ended 30 June 2018: The above distributions will be made • Special bonus issue – a fully imputed only to those shareholders entered on taxable special bonus issue of: the share register at 30 June 2018 who • One new “A” share for every twenty continue to hold, at the date of the 2018 existing “A” shares; and Annual Meeting, the shares held at 30 • One new “B” share for every five June 2018. existing “B” shares; and The above special bonus issue, • One new “C” share for every two rebate, bonus issue and dividends existing “C” shares; and represent $5.596 million being distributed • One new “D” share for every twenty back to MG’s loyal and supportive ↑ George Gibb from Greendale Mushrooms existing “D” shares. shareholders. Not only is this a significant and Michael Breitmeyer from MG Marketing. • Supplier shareholder rebate – a taxable distribution of wealth to the shareholders rebate of $250,000 to be applied by it represents the strength of the the Company in paying up in full “C” Co-operative as a whole. FINANCIAL OVERVIEW & DISTRIBUTIONS shares of the Company to be issued at In addition, and as has occurred for $1.00 each and made in such manner many years now, we are pleased to note as the Directors determine to those the support of the shareholders through The Group’s financial highlights are in value. Details around the assessment As announced at the November shareholders that are Current Producers their high level of reinvestment of their reported on page 6 and 7 of this review. process and the variables used in this 2017 Annual Meeting of Shareholders, that have supplied on a consignment dividends back into more MG shares For the year to 30 June 2018 Group calculation are more fully set out in note MG exercised the option to purchase basis during the financial year ended 30 (“A” and “D” shares). If you would like to Gross Sales under Management amounted 9 of the financial statements (refer to the the JS Ewers Ltd business, effective 1 June 2018. participate in the dividend reinvestment to $862 million ($894 million in 2017). full Annual Report). December 2017. The 7 months results (to • Bonus issue – a three for one fully plan please contact our Company For the same period net profit before tax MG invested in LaManna Bananas Pty 30 June) for this business are reflected imputed taxable bonus issue on the “C” Secretary, Duncan Pryor, at MG’s Support and impairment, including the gain on Ltd (LMB) in July 2003 with an initial 25% in the Group results for the year. shares issued out of the above rebate. Office for further information on email acquisition amounted to $13.667 million shareholding which grew to 50% in 2004 In addition to this Annual Review, MG This amounts to $750,000 worth of [email protected] or phone compared to $16.018 million in 2017. This and eventually became 100% in 2005. Over presents an Annual Report inclusive of “C” shares being issued (Shareholders (03) 343 1794. result came from the strength of both the years, the percentage shareholding full financial statements. If you would the NZ market and the business, offset has varied as a result of share issues, like a copy of the Annual Report visit by the challenges that were faced in the acquisitions and mergers and currently the website, www.mgmarketing.co.nz, → Ben Scott from Scottfresh Australian market. stands at 69.3%. The last significant event or contact the Company Secretary, and Andrew Body from MG Marketing. As is noted above, this year there has was the merger with Premier Fruits Group Duncan Pryor, on (03) 343 1794 or email been a partial impairment of the Group’s in 2016 – this saw LMB rebrand as LaManna [email protected] intangible assets, amounting to $32.330 Premier Group (LPG). million. Each year MG is required to The Group net (loss) after tax, the gain Group Profitability Net profit/ undertake an assessment of the carrying on acquisition and the impairment expense year ended 30 June 2018 (loss) after value of its various investments and amounted to ($19.502) million compared tax intangible assets against the assessed to a profit of $11.609 million in 2017. $’000 ongoing value. If the carrying value is At a Group level, MG remains strong MG Group excluding Australia 10,788 higher than the ongoing value, then there with equity standing at $107.147 million Gain on acquisition 6,568 is an impairment. The investment, or (2017 $129,678) and total assets of intangible asset, is written down in value $262.749 million (2017 $277.127 million). Australia (4,528) and this represents an expense in the The reduction between years is primarily Impairment expense (32,330) profit and loss. It is important to note that as a result of the impairment expense as (Loss) for the year (19,502) this is a non-cash write down/reduction discussed above.

8 9 Annual Review 2018 Review Annual Annual Review 2018 ®

Together. Stronger. Together. Stronger. Together.

® Bruce R Irvine Alan G Franklin Lynn T Crozier Chairman, Appointed Special Director Elected Director Elected Director Bruce joined the MG Marketing Board Alan was appointed to the MG Marketing Lynn joined the MG Marketing Board in in 1994. He comes with an extensive Board in 2010. Alan’s family has been 2012. Today Lynn, through a family-owned business background and previously growing for five generations in Auckland and operated business since the 1960’s, is held the position of Managing Partner since 1906. a grower of potatoes, onions and carrots of the Christchurch office of Chartered Member of the IOD*. in Central Canterbury. Lynn is a member Accountants, Deloitte, between 1995 and of the MG Audit Committee. 2007; and is past Chairman of Christchurch Alan D Thompson Member of the IOD*. City Holdings Limited. Bruce is currently Elected Director a director of Heartland Bank, PGG Alan was appointed to the MG Marketing Mike J Russell Wrightson and a number of other public Board in November 2016. Alan has a long Elected Director and private companies. Bruce is Chairman history and background in the growing of Mike was appointed to the MG Marketing of the Company, Chair of the LaManna many crops for the domestic market and Board in November 2016. Mike is a first- Premier Group’s Audit Committee, a export, and is an experienced exporter generation Hawkes Bay grower with 35 Director of LaManna Premier Group Pty in his own right. The family business, years’ experience, in partnership with Ltd and member of MG’s Remuneration & Kainui Pack & Cool, is involved in the his wife Julie, specialising in plums. Mike Nomination Committee. growing and packing of citrus, kiwifruit, is a member of the MG Remuneration & Chartered Fellow of the IOD* and avocados and melons, with pack house Nomination Committee. Accredited Fellow of the CAANZ**. and cool stores in Kerikeri. Alan’s family business holds a 25% shareholding in Te Mark R O’Connor Andrew G Fenton Mata Exports 2012 Ltd and Alan is both Elected Director ↑ MG Board of Directors from DIRECTORATE AND MANAGEMENT Deputy Chairman, Elected Director a Director and finance director of that Mark is serving a second term having left to right: Andrew joined the Board in 2002. He has business. Alan is a member of MG’s originally joined the MG Marketing Board Peter Hendry (Chief Executive more than 35 years in the avocado and Audit Committee. in November 2014. He is a Director and Officer)*; Bruce Irvine; Alan Thompson; Kerry Wells (International Change is inevitable and with it comes of this is regularly reviewing the Board’s kiwifruit industries through the Bay of shareholder of a family-owned market Business Manager)*; Alan Franklin; new faces and new thinking to the collective skill set and evaluating the Plenty-based Phoenix Partnership and Trevor J Burt gardening business in Nelson on the Trevor Burt; Mark O'Connor; Lynn business. The Board is no exception to best mix of skills required to continue to Beresford Orchards Ltd. He has extensive Appointed Special Director Waimea Plains. Crozier; Mike Russell; Trudi Webb (Director Intern); Andrew Fenton; this. As featured later in this review, Brian take the company forward. This resulted commercial and governance experience Trevor has high level experience in Member of the IOD*. Duncan Pryor (Company Secretary & Gargiulo handed over the Chairmanship in the Board Capability Framework being in businesses and industry groups. the strategic leadership of large and Chief Financial Officer)*. to Bruce Irvine after last year’s election. developed and subsequently published. Andrew is currently a director of New complex corporate organisations, *Executive Management Attendees. Mark O’Connor re-joined the Board In accordance with the company’s Zealand Horticultural Export Authority and and a proven record of implementing after last year’s election and Trevor Burt constitution, Alan Franklin and Lynn Kiwifruit New Zealand, President of the NZ change and achieving results. Trevor joined the Board as a special director Crozier retire by rotation and, being Fruitgrowers’ Federation, Chairman of the holds Chair roles of Ngai Tahu Holdings earlier in 2017. In addition, following eligible, have put themselves forward NZ Fruitgrowers’ Charitable Trust, a Member Corporation Ltd, Lyttelton Port of the introduction in 2015 of the Director for re-election. Two other nominees, of NZ Kiwifruit Growers Inc. and Chairman Christchurch Ltd, and New Zealand Internship Programme, Trudi Webb was Diana Baird and Joanna Lim, have been of Huddart Parker Building Co. Ltd. Andrew Lamb Company Ltd. He is Deputy Chair appointed as the second Director Intern. nominated and put themselves forward is Deputy Chairman, Chairman of the MG of PGG Wrightson Ltd and a Director As a Board, your directors maintain for election. As there are four candidates Remuneration & Nomination Committee of Silver Fern Farms Ltd, Landpower their focus on strategic issues affecting for two positions on the Board, an election and Director of LaManna Premier Group Pty NZ Ltd, as well as a former member of our industry and your Co-operative. is being held by postal ballot. Voting Ltd. Andrew was previously the President the Executive Board of the Linde Group The Board continued with its review and papers for the postal ballot will be sent to of Horticulture NZ and Chairman of Satara based in Munich. Trevor is Chairman of updates to the Charter, code of conduct shareholders together with the Notice of Co-operative Group Ltd. the MG Audit Committee. * Institute of Directors in New Zealand. and policies during the year. A key part Meeting on or around 19 October 2018. Chartered Fellow of the IOD*. Chartered fellow of the IOD*. ** Chartered Accountants Australia and New Zealand.

10 11 Annual Review 2018 Review Annual Annual Review 2018

THE END OF ONE CHAPTER SIGNALS THE ®

BEGINNING OF ANOTHER – A TRIBUTE TO Together. Stronger. BRIAN GARGIULO (MBE)

Brian Gargiulo is well acknowledged during Brian’s tenure as Chairman that Together. Stronger. Together.

® for his standing within the horticultural the Co-operative flourished and became a industry, and for good reason. It is only substantial organisation. but appropriate to reflect on the role The son of a grower and a grower he has played in the industry during his himself, Brian’s ability to identify an 40-plus years of service to the industry opportunity and then find a pathway and, most particularly, the part he has to commercialise that opportunity has played in securing the profitability and been to the benefit of many. There are sustainability of New Zealand’s largest many milestones during his tenure on fresh produce co-operative. the MG Board that secured real and Awarded an MBE for services to sustainable growth for the company and horticulture and New Zealand, Brian has shareholder wealth, not the least of which been relentless in his commitment to are the Dole partnership that changed developing the industry as a commercial the game for the banana category in proposition. He has championed New Zealand, the expansion of the MG MG PEOPLE innovation, lobbied for change when branch network, establishment of MG change was clearly long overdue and Direct to provide growers with a direct represented growers when they felt ill- distribution channel to key customers, In order to stay ahead of the field, and to highlighted repeatedly as a key factor in ↑ MG Executive equipped to represent themselves. the acquisition of the Australian LaManna continuously meet the changing needs our commercial success as a business. As Management Team

Brian was a key player in the Group of companies and the merger of of our diverse customer base, we must we to look to the future and recognise the From left to right: Chris Hibbert establishment of Horticulture New Zealand LaManna Group with the Premier Fruits focus on our people - ensuring we have challenges of change and succession, we (Chief Information Officer); and held the role of Vice-president for nine Group to form the LaManna Premier the best people working with us and that are committed to developing tomorrow’s Kerry Wells; (International Business Manager); Greig Pullar (National years (2005-2014); he served as President Group. Brian’s continuation as Chair of the we continually build their capabilities. In leaders from within the Co-operative. To Operations Manager); Roger on the Board of New Zealand Vegetable LaManna Premier Board is testimony to doing so, we strengthen you, our business this end, leadership forms a key part of Georgieff (National Procurement and Potato Growers’ Federation (1998 - the regard in which he is also held across and the Co-operative. our of people programmes. Manager); Peter Hendry (Chief 2015) and on the Board of MG for 36 years the Tasman. Our aim is to provide a work The well-being, health and safety of all Executive Officer); Jade Reeves (Wellington Branch Manager); Jerry (1981-2017) – 25 as Chairman. Brian’s years around the MG environment where our people are safe our people comes before anything. It is, Prendergast (National Key Account Brian’s achievements within the boardroom table will be remembered not and have the opportunity to grow and of course, a never-ending journey but the & Brand Development Manager); industry have been well documented only for his business acumen, but for the develop. We work in a very competitive ‘culture of care’ framework that has been Peter Lange (Imports Manager); Kimberly Chavez (Internal Audit but his contribution to the growth and value he placed on people and the things and constantly-changing environment. established within the business is the & Risk Manager); Duncan Pryor success of the grower co-operative, MG, that they valued. The impact that his We understand that for MG to meet essential foundation of our ® Together. (Company Secretary & Chief is less well published. inclusiveness and collaborative approach these challenges, we continually need to Safer. programme. The Co-operative’s Financial Officer). Established in 1923 by a small band has had on the culture of the company attract outstanding people who are also emphasis on the importance of keeping of resolute and like-minded growers, MG is evident, both in terms of the team culturally aligned with our business. safe is also populated throughout today stands as a leading supplier of fresh culture within the Group and the strength The MG Graduate Programme and the entire supply chain, with ongoing produce to New Zealand, Australia and of relationships that have been built with Sales Academy have been tremendously engagement with our suppliers and our the Asia-pacific region. The success of the growers and customers alike. successful in this regard. Both initiatives growers through SupplyLine and the Co-operative is testimony to the vision, the While Brian has handed over the are being further developed, not only to grower ‘shed’ meetings. leadership and the tenacity of a few and reins to Bruce Irvine to lead MG into the support development opportunities for On behalf of the Board and the commitment of many. Brian Gargiulo is next decade, he will continue to focus our people, but to invest in the long-term Management, we thank our staff for their one of the few – a leader, a visionary and on resolving the challenges facing the capability of our industry. dedication, hard work and loyal service an individual who was keenly focused on LaManna Premier Group and leading a Whilst new talent is essential to all to our growers, customers and to our building resilience in the business, first strategic programme of growth in the organisations MG has also developed business. We proudly acknowledge this and foremost, from which opportunities Australian market for the long-term a culture of long-serving staff. This contribution by featuring their names in could be successfully leveraged. It was benefit of the Co-operative. stability and wealth of knowledge is this publication.

12 13 DEEPIKA ADHIKARI REJAIL ADILOVSKI OPE AFUIE DHRUV AGGARWAL VIHANG AHLAWAT JASON ALABAKIS MARIA ALAMEDA ALIPA ALAPATI MANGAL MAGAR RADHIKA MAGAR YAM MAGAR BJ MAGELE TK MAH BRADLEY MAHAR BRENT MAHAR SIMONE MAHAR AJAY MAJHI SHAQUILLE MAKIHA 2018 Review Annual CATHY ALESSANDRINI JENNIFFER ALEXANDER JOHNNY ALI ABID ALI VERDENE ALI HUSSEIN ALNABULSI PIFALATI ALOFAKI DOMINIC ALOI VINCENT ALOI JAMES MALONEY JOE MANARITI ROCCO MANARITI DHAN MANGAR ARULKUMAR MANI FUSIPALA MANOA DAYAL MANU RUZA MAROS SAM MARSON IAN MARTIN ANNUNZIATO ANASTASIO ANASTASIA ANTONIOU SHAJI ANTONY JOSIAH ARCHER VISHANT ARORA JAIPALA ARPORN ADAM ATTANA CHARLIE ATTANA ROBERT MARTIN FRANK MARZANO PATRICK MARZANO HAMISH MASON SCOTT MASON FALCO MASTROCOLA LUKE MASTROCOLA BERNARD MATAELE USO AVIIVII PUA AYYAR KAUSHIK BABU NATALIA BAHATI KERRY BAIRD MANDY BAKER LUKE BAKER-GARTERS MICHAEL BALDWIN MU BAR ADEEP BARAILI ELISE MATHEWS-HERRMANN TOLUWANIMI MATTHEWS SUZANNE MATTINGLY TAUELI MAUGA TIMOTHY MAWSON DANIEL MAZENGIA ALLAN MAZZOLA BENJAMIN BARBARA BRUNO BARBARA JONATHON BARBARA JOE BARBARA SAM BARBARA VINCE BARBARA RACHEL BARKER TROY BARR PETER BARRETT MURRAY MCBRIDE ALEX MCCALLUM CHARLES MCCASKILL FREDERICK MCDONALD RYAN MCDOUGALL STORM MCDOWELL YVONNE MCILWAIN DAVID BARRIE JACK BARRIE BLAIR BARWICK JAMES BATEMAN JEGATHEESWARY BATHMANATHAN LISA BEATON ANTHONY BEKKER HARRY BELL LYNN MCKAY MARGARET MCKENZIE ANDREW MCKENZIE MITCH MCKEOWEN DEREK MCKINNEL PHILIP MCLEAN REBECCA MCNAMARA JUSTIN MCVEIGH

Annual Review 2018 CAROLYN BELOE CAROLINE BENDALL COLIN BENNETT FRANCESCO BENVENUTO LAURENCE BENVENUTO MARK BENVENUTO JACK BESWICK AJESH BHAI ADAM MEEHAN GREGORY MEEHAN GREGORY MEIBUSCH LIVIO MENEGAZZO REECE MERRETT DALE METCALF MATTHEW METCALF MARK MIDDLETON BEENA BHANA DHRUV BHATIA JASDEEP BHATIA PETER BHOLAN RAJ BHOLAN DAVID BINKS STACEY BLANCHARD ANDREW BODY ROBERT BOLGE SEMISI MIKA SALVATORE MILANESE JACKIE MILLAR WANDA MILLS DAVID MILNE GEORGE MILTIADOU JO MINTON-CONNELL LAR MIT GIOVANI MOLINARI CAROL BONHAM KAINE BOOTE CHRIS BORSATO JOSEPHINE BORSATO KIM BOUSTRIDGE SHAUN BOWIE TONY BOYD EAMMON BOYLE BREV BRAK PRADIP MONGAR PURNA MONGAR SHANE MOON DANIEL MOOR MICHAEL MOORE RUFINO MORALES JORDYN MORGAN-DENS'E STEVEN MORICE CHRIS BRAMMALL SAMUEL BRAY MICHAEL BREITMEYER ANNA BRENMUHL NEIL BRIDGENS GRANT BROUGHTON TONY BROWN FIONA BROWNE SAMANTHA MOULD SAY MOY KHEE ROB MULHOLLAND KEVIN MUNROE SRINIVAS MUPPAVARAM ALLAN MURRAY GEORGE MURRAY VINCE MUSICO BRIAN BUCHANAN HAYDEN BUCKLAND CATHY BUI RAHUL BUKSH LEDEGONDA BUKURU DYLAN BULZOMI DANIELA BUNN LUKE BURGESS TREVOR BURT SOJAN MUTHUNNY JUDITH MWALIAHA THI MY TO VUU CON MYDARAS FLORA MYDARAS CON MYLONOPOULOS VICKY NAND MAHES NARAN JOE NATI ®

PETER BUTCHER DAMIEN BYNG GRANT CADDIGAN DOMINGO CAICEDO VALENCIA ANGUS CALDER FRASER CALDER MARK CALLEGARI ROSS CALTABIANO FETUIAKI NAU ALLISON NELSON DANIEL NEUMANN JEFF NEUMANN WALTER NGATOKO PATIENCE NGUGI SY NGUON NARY NGUON LIEM NGUYEN Together. Stronger. SHAUN CALVI MIKE CAMPBELL KIERAN CAMPBELL CHRISTINE CAMPBELL WAYNE CAMPBELL ALLAN CANLAS JEANETTE CANNISTRA JOHN CARESWELL PHUONG NGUYEN SANH NGUYEN TRAN NGUYEN TWEE NGUYEN INDRA NIRAULA JASON NOBLE TIMOTHY NORTH PETER NORTHERN STEVEN OAKES ALEX CARTWRIGHT LIAM CARTWRIGHT GORDON CARUANA CARLA CASIMIRO PAUL CASIMIRO VICKY CASSISI GERARDO CASTRO VERGARA ALDO CATALANO SAM O'CONNELL MARK O'CONNOR TAYLOR O'DONNELL URSULA O'DONOHUE WAYNE O'HALLORAN GRAEME OLDHAM BRENDAN O'NEILL CONNOR O'NEILL ALBERT CHALMERS ROSHIL CHAND SHAUN CHAND PAO-KUEI CHANG CALEB CHAPMAN OWEN CHARLESTON ANTHONY CHARLTON JASON CHARTRES SEAN O'NEILL ANTHONY ORD CHRISTOPHER O'ROURKE AMERIGO ORTADO ROGER O'SULLIVAN RICHARD OTT KIM OUN SOUNG NOEL OWEN FRANZ PABLO CHANDRIKABEN CHAUDHARI KIMBERLY CHAVEZ BOPHEA CHEA HUAPING CHEN YAQING CHEN YUMENG CHEN RAVI CHINTALA VICHEKA CHIV SHAJU PADAYATTY HORMMIES ALEX PAICE SENITU PAKOME ATINDER PAL SINGH PAUL PALAZZOLO SAROJ PANDEY KIRAN PANT DIMITRIOS PAPAGIANNIS HELENA CHUNG MARIE CICERO SAMUEL COFFEY TED COLEMAN NICOLA COLLIER JACK COLLISS JOSHUA CONDLIFFE AARON CONDON GEORGE CONDON HANNA PARK JAMES PARRY JUSTIN PARSONS MONIKA PATEL SUNIL PATEL ALPABEN PATEL DIXIT PATEL NGA PATIA PRADEEP PAUDEL MEFIPOSETA PEI

Together. Stronger. Together. GUISEPPE CORRONE ROCCO CORRONE GAVIN COSGRIFF MARK COSSAR LEON COX JOSHUA CRAIK JAMIE CRAWFORD GIUSEPPE CREA CRAIG PERRY KEITH PETERS DARRYL PETERSON GIUSEPPE PETRORO MICHAEL PETRORO LAR PHAN THUY PHAN HOON PHAT SUZANNE PHIBBS ® JAMES CREED GRANT CREIGHTON ANDREW CROSS LYNN CROZIER DESDA CULLEARN JACQUELINE CUMMING BRIAN DALE MELISSA DAMPIER JORDON PHILLIPS FRANK PICCOLO GIOVANNI PILATI LAURA PIO ROBERT PITOITUA SIATHAN PLIANSATJA MARK PLYMIN ROCHELLE POGSON PRABHAKARAN PONNUVEL PETER DANIELS DAHVY DAO MARK DAUNT CRAIG DAVENPORT COLIN DAVIS NERISSA DAVIS CAMERON DAVISON SHARNEI DAWSON MICHELLE DE BRINCAT TIM POORTER ADELLE PORTER BLANCA PORTILLO ACOSTA SKYE POWELL-JONES ANUP PRAKASH BHIM PRASAD DHUNGANA DEREK PREGL MICHAEL DEBONO CHENEL DEHAR MARK DENTON LORETA DERRAMAS JOSTI DEVI SAMANTHA DEVINE JOE DEVLIN ANTHONY DI PIETRO FRANK DI PIETRO JERRY PRENDERGAST DAVID PRICE LIAN PRICE STEPHEN PRIOR SAMUEL PROUTING DUNCAN PRYOR GREIG PULLAR JAMIE PULLEINE KARTIK PURI JOE DI PIETRO JOSE DIAZ BENITEZ KILIMO DIDIER MAZAMBI PETER DILKES JONATHAN DILLON ADRIAN DIONISIO ASHLEY DJU GOLDIE DODDS LEON DODDS TULA PUWAR MAGAR GHANA PYAKUREL EILEEN QUIMQUE LUKE RADAN KAREN RADWAY ASHOK RAI BUDHA RAI DUNCAN RAINES AMIT RAM TONY RANALLI DAVID DOHNT RAMON DONES CHRISTOPHER DONEY PHILLIPA DUNN DERRICK DYSON GEORGE EAGLES DAVID EDMONDS REBECCA EDWARDS RUSSELL RANGI RANGI ABDUL RASHID JOSHUA RATIMA GIOVANNI RATIMA-MITA JITHENDRA REDDY SHOW REDDY YERUVA JADE REEVES MIKE REGAN JACOB EDWARDS SHARLENE EDWARDS MIRUNALINI ELANGO KENT ELFORD IAKOPO ELISARA EPATI ELISARA SOLI ALLAN ELLIOTT NAW ELLIS BEH REH KO REH NEH REH POE REH POE REH PREH REH SHARON REID BRETT REID HOWARD REILLY IAN REISIMA MARGARETA RELIA COREY RHEA JOHN RHEA SHIRLEY ELVY ALAN EVANS PETE EVANS JOANNE EVERINGHAM JIM EVGENIADIS MALCOLM EXTON JOVIN FABIC MATTHEW FAIRCLOUGH GREGORY RICH MICAH RICHARDS WENDY RICHARDS SHANE RICKIT CATHY RIDDEN NJIGNYA RITA JASON ROBERTS LANCE ROBERTSON JOHN RODERICK AHMAD FAIZAL ABDUL HADI ELISARA FALO THA IANG FAMCUN MADONNA FARAG WAYNE FARROW LAURIE FEMIA ANDREW FENTON ERIC FIELD LIGIA RODRIGUES BRADLEY ROSENDAHL BEN ROSS MARTHA RUDKEN FRANK RUGGIERO NI RUNG NATASHA RUS JAMIE RUSS MICHAEL RUSSELL VICENTE FIGUEROA GASCA BLAIR FISHER DOUG FISHER ASHLEY FLEGLER BRAD FLEMING WAYNE FLETCHER GWENDA FOLEY MURRAY FORBES TEMA THOMAS FORTES MIKE RUSSELL MATHEW RYAN NICHOLAS RYAN THI SA LUONG MARIAM SAFAR DANIEL SALAU ASRUTHA SALIBINDLA JIAH SALLEY ADELINE SALLEY-GLOBIO INGE FOUNTAINE ANGELA FRANCIS LINDSAY FRANCIS GEORGE FRANCIS ROBERTO FRANCO ALAN FRANKLIN FRANK FRAPPA DAVID FREEMAN GLENN SALT MARY SAMPIERI KULWINDER SANDHU LAL SANGI IVANNA SANTARELLI DAVID SAVILLE REON SAYER ROCCO SCARFO KYLE SCHINS AARON FRIEND CAMERON FRIEND AUGUSTINO GAE'E BAILEY GALL DEAN GALL TRENT GALL FRANCESCO GALLICCHIO DAVID GANNON ROMEO GARCIA MICHAEL SCHRAPEL EVELYN SCHWEIGHOFER PAOLO SCIANCALEPORE SHANE SCOTT DIANE SCOTT AUKILANI SEGAUEA SAMSOTHEA SEK SIDDHARTH SHARMA FLOYD GARDINER JESSICA GARDNER DOMINIC GARGIULO BRIAN GARGIULO JAMES GARGIULO PIERRE GARGIULO MARCUS GARGIULO ABE GARZA ANISHA SHARMA LIN SHATE HO BRUCE SHEED REBECCA SHEED CURTLY SHRIMPTON KAMALKANT SHUKLA INOKE SIALE GAJAY SINGH COLIN GASS JHANAK GAUTAM ROGER GEORGIEFF WARRICK GIBSON IVAN GILBERT HARPREET GILL CLAUDIA GIORNO JOHN GIUFFRE MARC GIUFFRE HARDEEP SINGH PRANEEL SINGH AMANDEEP SINGH AMRITPAL SINGH ARSHDEEP SINGH DILDAR SINGH GURNOOR SINGH GURTEJ SINGH GARY SINGH BEN GLANVILLE MARCUS GOBALD SAMEH GOBRIALL PAUL GODDARD ALEX GODFREY MATTHEW GORDON SAMANTHA GORDON BRENT GRAHAM HARJOT SINGH SIMI SINGH HARVINDER SINGH HARRY SINGH JAGDEEP SINGH JAGPREET SINGH JASPAL SINGH KAWALJEET SINGH KULDEEP SINGH DAVID GRASSO JANET GRASSO LIZ GREENWOOD SUZANNA GREGORY MERCEDITA GREISING MARPA GRIEKSPOOR DANUTA GROBELSKI ADAM GROVE PARMJIT SINGH RACHHPAL SINGH SATNAM SINGH TAJINDER SINGH ANDREW SINNOTT INDIANA SINNOTT JOHN SIOZIOS GAJENDRAN SITHAMPARANATHAN MARTIN GRUNDLINGH PRANESH GUPTA ANDHYALA ABBAS HAIDER CHRIS HAJOS DEAN HAMILL KATE HANDS NALEEN HARAKH SIMON HARDIE THOMAS SIU SUGANYA SIVASATHTHY TIMEA SIVERTSEN STEVEN SKRUZNY ANTON SKVORTCOV NATHAN SMART GLENN SMITH GLEN SMITH MARK SMITH JAMIE HARDING MARK HARDING DANYEN HARROD LIAM HART BRUCE HARVEY SCOTT HARVEY MAARA HASAN CONNOR HAUSMANN ADRIAN HEINRICHS DAVINDER SOHI TREVOR SOLOMONA HEUNG SOO PARK GEMMA SORENSEN ANUSHA SOTHIRATNAM ANTHONY SPANO DIMIETRA SPANO ALEX HENDRY PETER HENDRY VANNAK HENG LUKE HENLEY MARIA HENRY ADAM HEREMAIA CHRIS HIBBERT SIMON HICKEY WING HIEW IAIN HIGGINS DAVID SPEDDING MELISSA SPENCER RHETT SPENCER STEPHEN SPENCER EDWIN SPITERI BRENDAN SPITTLES LACHLAN SPRINGFORD BEN SQUADRITO MOHAMMAD HIJAZI TRUCE-ANNE HILLARY CORAZON HINCHCLIFFE TJ HIRINI ALEX HIRSLER GRAEME HIRST DAWT HLAWNCEU CEU HLAWNCHING KANYAKORN SRICHANDEE KELLIE STAM PETER STAM WILLIAM STAM MARC STANTON NUNZIO STARVAGGI BAILEY STEVENS MIKE STEVENS ANTHONY STONE CUNG HLICHAL ANDREW HOARE MARK HOBBS WENDY HODSON ROB HOLLIER CARA HONEYSETT RAFAEL HORMIGO SHANE HOU MATT HOUSE OWEN STOTTS SIMONE STRATHAIRN GRANT STUMBLES NENGAH SUJAINI KENNY SUMOOK RODERICK SWEENEY WAYNE SWIFT DANIELA TAGLIAMONTE ROSS HOWARD JYE HOWSON MARTIC HRABANOV YUAN YUAN HU COLIN HUDGSON ANDREW HUESSER BEN HUME WAYNE HUME NIDA HUOT DAR RIA TALAWNG CEM TALAWNG AJITH TAMANG LASANG TAMANG BONNIE TAMATEA SOKLY TANG SUN TANG PIERRE TANNOURI NICO TANUVASA MAEANA HURINUI PIO HURINUI JACOB HURRING PETER HURRING MOHAMMAD HUSSAINI BRADLEY HYDE AMAL IBRAHIM GRANT INWOOD SALA IOANE KELEKOLIO TAPUELUELU ANGELO TARANTO MARIO TARANTO NATHAN TARANTO PHUONG TAY HUYNH CAMERON TAYLOR EVAN TE HIKO KAIREWA TEPANIA MICHAEL IOPPOLO BRUCE IRVINE KAORI ISHIKAWA JEREMY JAMES SALOTE JEBREEL CHARLOTTE JEFFORD BRIAN JEONG MATTHEW JEWELL JAI JIANG GREG TESESE HENG KIM THACH KIEN NGOC THACH SAROS THACH SOVANN THACH THANH NI THACH NU THANH DIEP DHIRENDRA THAPA SAMESH THAPA NARENDRA JINA MAXWELL JOHANSSON CARYL JOHNSON PAUL JOHNSON ABBY JONES MANICKATHAN JOSEPH KAMAL KAAKOUR MANASE KAILEA DEP DANH THI UT KIM THI THI THI HAO DINGH ELANGO THIYAGAARAJAN EMMA THOMAS BEN THOMAS ALAN THOMPSON LAR THU MICHAEL TIERNEY YOGENTHIRAM KANDIAH DE KANG DING MADI KANJULA CARMEN KANNIS JONATHAN KARANTGIS UTHAYASEELAN KARIKOVINTHARAJA SUNG TLUANG NEH ALFRED TOAILOA BERNARD TOAILOA MATTHAN TOAILOA ROMERO TOAILOA SHAOLIN TOAILOA MARK TOBECK ROEL TOLEDO PARDEEP KATARIA LOPASITA KATOA RAMINDER KAUR GURJEET KAUR HARJIT KAUR JASBIR KAUR JASVINDER KAUR RAVINDER KAUR SANDEEP KAUR SARINA TOMRUK PENISIMANI TONGA PETERU TOPETO JAMES TORDOFF CYRIL TORRANCE KILIMO TOUSSAINT MUKAMBA MU TOY THI HUE TRAM SANDEEP KAUR DHANOA SIMARJIT KAUR VIRDI SIOSAIA KAVA RORTHA KEO JANETTE KERR SURENDRA KHADKA IRSHAD KHAN RITHIPOLMOLY KHUN THI XUAN DAO TRAN VE TRAN THI TRANG DOUG TRASK JEYE TRIMBOLI JOE TRIMBOLI NATASHA TROVATO ALAN TSAI JERMAINE TUHI TOLOVAE TUILAEPA THI KIEU DIEM CHAU DJ KILDEN HYEMIN KIM PAUL KING LIGAYA KIRK JENNIFER KIRKWOOD TINO KISONA MARK KLAUSS CHARLIE KUMAR UINISE TUITAHI VINCENT TURCO CARL TURNER TAMANGO UARUTA LIAM UNDERWOOD MAI UNG UK LIAN VAN ANDY VAN HRAM PENG VAN PENG MANDEEP KUMAR GAGANDEEP KUMAR GAURAV KUMAR SUDHIR KUMAR VINAY KUMAR ROSS LAIDLAW SIULAATI LAKALAKA SAMUELA LALONI ANDREW VASSALLO IRINA VASSILIEVA NAU VAVE KONDAL VEERANNAGARI CON VELONIAS VIWARTH VORNG ELIZABETH WADDINGHAM JOHN WADDINGTON HIEU THI NGOC LAM ANGILILO LAMA SIFA LAMA GEOFF LAMONT DAVID LANDY PETER LANGE MAKAHOKOVALU LANGI TUUNGAFASI LATU LAWRENCE LAVERY SHANE WADSWORTH SHERYL WAGNER ALAN WAKE BRETT WALKER PETER WALSHE XIAN WANG MURRAY WARD WAYNE WATKINS ROSS WATSON HUMPHREY LAWRENCE CHAU LE FRIEDA LEE JUHEE LEE HAZEL LEES ERONI LEILUA RICCARDO LE'MONT CHRISTOPHER LEONE CHI LEUNG JENNIFER WATT BAHATI WATUTA TRUDI WEBB STEVE WEBER WAYNE WEBLEY KERRY WELLS WENQING WENG KELLY WETERE LA WI KEN WILLEY WHITNEY WILSON GAVIN LEVY TRUDY LEWIS JIA LI JESSIE LI HONG LI MIKE LIA BINGQIN LIN HUAYU LIN QIN LIN YUNPING LIN KAREN LINDSAY CAROL LISSINGTON DIANA WILSON ANDREW WILTON MATTHEW WILTON CHIN WING LAM KAHURANGI WINIKERI WING WONG JARED WOODCOCK ETHAN WOODMASS DANIEL LITTLE GRACE LITTLE WILLIAM LITTLE LEI LIU XIUGE LIU ZHONGYA LIU MARCUS LOGIUDICE MARK LOGIUDICE ANA LOLI PETER LOPES MUYHEANG LY KELVIN WOODMASS ROSANNE WORSFOLD I-JUI WU XIAO YAN LIN CHAOHUA YANG JALY YEN JONGHO YEO CHENGMING YI LINWAN YI QUI YING HUANG BRUCE LYON TALIA MAAKA STUART MACDONALD BRETT MACEY FRANK MADAFFERI ROSS MADAFFERI BAL MAGAR BOM MAGAR INDRA MAGAR JONATHON YOUNG JIAN YU LIN ANTONIO ZANNINO CA TIN TIAL ZATHANG FENGYING ZHENG SHAOMEI ZHENG ANDRE ZITTERSTEIJN JOSEPH ZOFREA

14 15 → Pierre Gargiulo from JS Ewers 2018 Review Annual Annual Review 2018 ®

Together. Stronger. Together. Stronger. Together.

NEW ZEALAND OPERATIONS INTERNATIONAL TRADING

The New Zealand operations maintained of the business, we are committed to MG has also made an investment in MG is the leading importer of fresh fruit more evident within the grape category growth and had a record year, both in developing fresh talent. Gisborne-based First Fresh NZ Ltd. First and vegetables into New Zealand. Much where old, high cost, varieties are being terms of gross sales under management MG continues to look for new ways of Fresh is a leading citrus supplier, both to like our domestic growing operations, replaced with high producing, lower cost and profit before tax. adding value for the benefit of the grower domestic and export markets. Citrus is global producers have faced their and improved flavour seedless varieties. This result is again the accumulation shareholders. The partnership with complimented by persimmons, kiwifruit challenges with weather variables during Our key category supply partners, such of good operating performances across RuralCo, a co-operative that provides and other sub-tropical lines. The the year. Logistical challenges have also as Jasmine Vineyards in California, Dole all divisions, improved volumes sold MG members with the ability to access investment will strengthen MG’s citrus impacted throughout the year. Despite Chile and Fruitmaster in Australia, are at and higher values across many fruit and savings on farm supplies, fuel, power supply base and provide further growth these challenges import revenues the forefront of this evolution. vegetable lines for much of the year. and fertilizer, has now been running opportunities for our business. This improved across all key categories, driven Convenience is also another factor The success of different operating for over a year. If you have not had the investment was a natural extension of by both volume and value. shaping other categories and consumer models, such as MG Direct and the opportunity to review the benefits of what had been a very successful working Our imports team is focused on shopping behaviour. Easy peel mandarins Grower Delivery Advice (GDA) portal, this association, please contact your MG relationship over many years. maximising sales of products not grown are fast becoming the citrus category continue to gain momentum and bring procurement representative for further Our shareholding in both New in New Zealand or out of season. As leader and close to year-round supply, efficiency gains for all. information. Zealand Fruit Tree Company Ltd and consumers become more adventurous including domestic production, is being MG has progressively invested in its In December 2017 MG purchased the Zee Sweet Ltd forms an integral part of with their culinary skills and the food supported by our key supply partners branch network infrastructure throughout JS Ewers Ltd Nelson growing operations. our commitment to more sustainable service sector grows, the opportunities Sunkist and Mildura Fruit Company. The the country, with all facilities being Prior to this, MG had been working farming and to delivering better quality for more ‘exotic’ products also show recent introduction of an innovative temperature controlled for the optimum collaboratively with the JS Ewers business and taste for the consumer through promise. pineapple coring machine to the storage of product. Upgrading continues through various contractual arrangements investment in IP varieties. Dole is the largest selling proprietary market demonstrates how providing as needed to cope with growth, as was and exercised the right for the acquisition brand in the market. They continue to the consumer with a cost-effective and the case with our Palmerston North midway through the year. This substantial deliver high quality and innovation to convenient product can drive sales branch which was upgraded with new glasshouse and outdoor vegetable The success of different the market place. MG has now been in momentum. Store trials are underway chiller facilities during the year. production unit continues to deliver operating models, such partnership with Dole for 25 years and throughout the country and we expect to Our investment in human resource against MG’s core purpose of generating Dole remains the leading brand across roll out more of these machines later in is another constant for the business. shareholder wealth and the strategic as MG Direct and the the tropical fruit range of bananas, the year. Our capability to provide consistent pillars that support this purpose. As well Grower Delivery Advice pineapples and paw paw. Our international supply partners are and value-added support for our as being a profitable business, the scale, Our imports division continues to leaders in their particular field and most suppliers and customers is contingent range, quality and continuity of supply it (GDA) portal, continue drive initiatives which deliver great have a long-standing relationship with on our ability to deliver on our human brings creates category support from key to gain momentum and tasting fruit and vegetables that will MG. This is a key factor in our success as resource strategies. Additionally, as customers. This allows other suppliers to bring efficiency gains enhance repeat purchases and meet the they understand our marketplace and the business grows, and to effectively support category supply initiatives and customer’s expectations for all round help to bring innovation and competitive manage succession planning in all areas grow their business. for all. supply and diversity of product. This is no advantage to our business.

16 17 Annual Review 2018 Review Annual Annual Review 2018 ®

Together. Stronger. Together. Stronger. Together.

® UNITED FLOWER GROWERS LTD

MG’s joint venture flower business, UFG, reported a record year in both sales and profitability, up from the previous year’s high. 2018 has been characterised by a number of significant events which have impacted on the business. Despite these challenges the business has responded and performed well. ↑ Murray Tait from Te Mata Exports The purchase of the Floramax flower auction business in April 2017 required the successful merger of staff and company cultures which has been achieved, along with the synergy gains this acquisition expected to realise. TE MATA EXPORTS 2012 LTD The business has continued to expand services with a dual auction clock being introduced into the Auckland branch. MG’s joint venture export partner, Te Mata International trading of perishable After some consenting delays, UFG also Exports, consolidated on growth in recent products is a challenging environment introduced a clock auction system into years to provide another solid trading result. to operate in – so while not without risks the Christchurch market during October Despite industry apple export volume our business growth is being managed 2018. This will further improve service being down on forecasts, our market share prudently. Fundamentally, this relies levels to both suppliers and customers grew against this trend. Generally, export on partnering with quality growers and alike and deliver efficiency gains for the apple values were lower than the previous working collaboratively to achieve the business. year but overall our revenue showed strong best possible returns. This also extends With all the changes and disruptions gains on the back of improved volume. to enhancing customer relationships behind us, the focus is on continued As our apple business continues to show by providing sustainable business commitment and stabilising our services year on year growth, other products in the partnerships. To maintain service levels to flower growers and buyers. We plan portfolio are also showing rapid growth, as we continue our growth trajectory, to move forward from here by continuing in particular citrus. Our diversification additional human resource is being to develop programs, resources and strategy continues to gain momentum with employed. opportunities that best benefit everyone non-apple product lines now representing Our export industry has enormous associated with the industry. This includes approximately 50% of turnover. The growth potential – our ideal climate access to analytical and technical business is now trading product from and soils, investment in R&D and new information to better assist flower growers, New Zealand, Australia and the USA. varieties, a focus on best-practice expansion of our digital auction platforms This continues the strategy of linking growing, our proximity to key markets and and the introduction of remote buying global opportunities through the Group’s the global environmental consciousness (cloud auction) to the South Island, or relationships to Te Mata Export’s reputable of consumers all have the New Zealand finding more ways to improve the demand customer base. horticultural industry well positioned. for New Zealand grown flowers.

18 19 Annual Review 2018 Review Annual ← LaManna Premier Group LPG Farming Operations Board of Directors From left to right: Mark Plymin (Chief LPG Warehouse and Financial Officer)*; Andrew Fenton; Market Operations Dean Gall (Chief Operating Officer)*;

Annual Review 2018 Brian Gargiulo MBE (Chair); Anthony Di Pietro (Group CEO); Bruce Irvine; Jo Minton-Connell (GM Human Resources)*; Peter Hendry; Simon Hardie (Chief Commercial Officer)*. ®

Below left: Mark LoGiudice; Together. Stronger. Below right: Duncan Pryor (Secretary to the Board)*. *Executive Management Attendees. Brisbane Together. Stronger. Together.

AUSTRALIAN OPERATIONS – LAMANNA PREMIER GROUP Perth

enablers for improvement in this area. 2018 was a challenging year on many The LPG business handles over 20 Adelaide Sydney fronts, weak market conditions and million cartons of produce per annum. The final stages of our network product values across LPG’s key Product handling efficiency is therefore and systems integration is almost categories being the most significant a critical component in capturing cost complete. Ongoing development and Melbourne disruptor. efficiencies. A full review of our logistics implementation of business analytics Low product values on certain lines and service provisions is well underway. tools are also underway, which will have become the norm for an extended The business is, however, mindful of the improve the availability of information to period now. We need to adapt to this need to balance growth opportunities support sound decision making. challenge and the changing market with a cost efficiency focus. Profitable sales growth initiatives LPG FARMING OPERATIONS conditions and look to new initiatives in LPG has been working hard on are a key priority - this is underpinned order to mitigate some of the economic business improvement strategies for by building on initiatives that allow for consequences. This may take some these disruptors and on a number of key having ‘skin in the game’ and developing Innisfail Banana Farming Company Freshway Farms LPG Lancaster Farming time to achieve but initiatives are well priorities in the immediate future. First strategic grower partnerships and (Joint Venture with the Borsato Virginia, South Australia Lancaster, Victoria underway. There are some early signs of and foremost, the executive team has customer relationships. Family), Innisfail, Queensland - 2.7 hectares of greenhouses - Hydroponic crops grown under improving market conditions which are been realigned and refocused on these Significant post-merger efficiency gains - Circa 142 hectares under crop - Growing tomatoes, capsicums, a retractable roof structure also encouraging. key priorities. They are also focused on have been implemented during 2017 and - Circa 340,000 cartons produced cucumbers, zucchini and eggplant - Stage 1 (5 hectares) of a 3 stage Sales volume on some lines has also ensuring that the company values and 2018, with further gains initiated as we annually - Circa 160,000 cartons produced 25 hectare project complete and deteriorated as over production has culture continued to be aligned with the enter 2019. We will take lessons from the annually under harvest limited opportunities into key customer organisation strategies. past but have a firm focus on the future. Australian Banana Company - Initially growing gourmet tomatoes accounts. New commitments from these Investment in resource and We remain steadfast on our commitment Innisfail, Queensland LPG Mercuri Farming - Circa 250,000 cartons to be customers are being built on the back of infrastructure within farming to invest in our people and communities. - 2 banana packing facilities (Joint Venture with the Mercuri produced annually in Stage 1 our farming operations and by providing operations has commenced to provide Whilst there is uncertainty on the - Specialising in banana packing Family) Lancaster, Victoria more certainty for the business across the improved stewardship on operational timing of improvement of the low-price - Circa 1.2 million cartons packed p.a. - 57 hectares of field tomatoes core categories of bananas, tomatoes, improvements, quality and consistency environment we remain optimistic about under crop pumpkin, melons and citrus. of supply. the future. MG and LPG are taking a long- Darwin Fruit Farms - Circa 340,000 cartons Consequentially, our farming operations Efficiencies across warehouse term view so that, whilst the immediate (Joint Venture with Piñata Farms) also suffered from depressed market operations and productivity are a complex focus and priorities are to strengthen the Humpty Doo, Northern Territory Shamrock Gardens pricing. Some categories have experienced area of the business and will take time to business to address the challenges, the - 369 hectares under crop (Joint Venture with Galwey Family), 10-year pricing lows which, to a certain come to fruition. Direct to store models, strategic focus is to continually improve - Growing bananas, pineapples and Broome, Western Australia point, are beyond our control. As such, similar to those implemented in New the business model and associated tropical fruits (primarily mangoes) - 121 hectares of seedless farming yields and operating efficiencies Zealand operations, along with on-farm infrastructure to take full advantage of - Circa 320,000 cartons produced watermelon and pumpkin are the immediate focus to mitigate weak quality assurance, compliance and future opportunities and set the business annually - Circa 3 million kg's produced market conditions where possible. technical support initiatives are all key up for long term sustainable success. annually

20 21 For some time now, investment in our people, 2018 Review Annual growers and community has been part of our strategic fabric, with a number of unique Annual Review 2018 initiatives being developed as a result. ®

Together. Stronger. Together. Stronger. Together.

↑ MG's Intern Director Trudi Webb

® GROWING YOU MG’S INTERN DIRECTOR – TRUDI WEBB

We have made significant investment in provide insights on topical issues The MG Marketing Board is pleased Trudi is part of a fourth-generation the grower development programme, affecting our industry, gain feedback and to announce Trudi Webb as the family growing enterprise, Webb’s partnering with organisations such as respond to questions. We encourage recipient of the 2017 Director Internship Fruit - arguably one of New Zealand’s Lincoln University, to offer our growers you to participate in these meetings for MG Marketing. most successful summerfruit and access to some of the latest thinking to enable a two-way flow of ideas and The director internship was apple producers. Alongside her and learning within the sector – this information. introduced in 2015 as part of the husband Simon, Trudi operates the is our Grower Development Workshop The Director Internship programme ® Growing You initiative and also original family-owned orchard that Programme. We are currently looking was introduced in 2015 with the aim of formed part of the MG Board’s strategy was established over 100 years ago on at additional programmes that include encouraging shareholders to grow their to broaden the knowledge and 32 hectares of land near Cromwell in elements of the Graduate Programme knowledge and governance experience. experience base of our shareholders Central Otago. and Sales Academy and potentially The position allows the intern to attend and their families, while giving those Trudi holds a first-class honours extending to a growing academy. all meetings with full speaking rights, but with an interest in the governance Bachelor of Applied Science (Horticulture) Our biennial regional grower shed no voting rights, and is supported by a of MG Marketing a taste of what is degree and is Chairperson of the Otago meetings were conducted across the mentor from the MG Board. Trudi Webb involved. While the intern is not an Fruit Growers Association. Her wealth country. This is our opportunity to keep has now joined the programme, being actual director, the appointment of experience in the summerfruit sector the grower Co-operative abreast of our second Director Intern, as the Co- allows the intern to participate and underpins her vision for the industry MG’s recent initiatives, discuss the operative's commitment to developing gain experience in MG’s corporate of environmental and economic financial performance of the company, the governance skill set of our members. governance. sustainability for future generations.

22 23 Annual Review 2018 Review Annual Annual Review 2018 ®

Together. Stronger. Together. Stronger. Together.

® MG in the Community

The health of our people and our wider MG continues to support the community is at the heart of what MG efforts of the Salvation Army who does – primarily this is what we call help to fight poverty and social and ‘selling health to the nation’. emotional distress in New Zealand. MG is a significant sponsor of the Last year we announced our United Fresh and the 5+A Day Charitable partnership with the Māia Health Trust programme. The Trust was launched Foundation as a Founding Business over ten years ago to help encourage Partner. Both organisations are consumption of more fresh fruit and focused on health and well-being of vegetables to improve the wellbeing our communities. Māia is working to of New Zealanders. Ten years is a raise funds for essential projects to significant milestone and MG is proud of help New Zealanders get the right its association – the Trust plans to focus medical care, at the right time and on the workplace and education sectors, in the right place. By supporting stay at the forefront of social media and Māia we can play an important role Andrew Derbridge, Susi Boehm and Ben Scott from develop more nutritional information for in supporting the health of many in Scottfresh with Shaun Bowie and Andrew Body from MG. consumers to use. the community.

24 25 Annual Review 2018 Review Annual SUSTAINABILITY ANNUAL MEETING INITIATIVES OF SHAREHOLDERS

Annual Review 2018 All shareholders are invited to attend Sustainability is the “development MG’s Annual Meeting of shareholders. that meets the needs of the present This year the event will be held at the ®

without compromising the ability Copthorne Hotel, Palmerston North, Together. Stronger. on Wednesday 21 November 2018, of future generations to meet their commencing at 5.00pm. Shareholders own needs”. are welcome to join MG directors, management and staff to formally or Together. Stronger. Together.

® informally discuss topics of interest. Sustainability affects many areas of our lives and business. There will be a dinner following on Be it through the drive to reduce waste, lower our carbon from the meeting at approximately footprint, enhance staff well-being, lower energy consumption 7.30 pm and all shareholders and their or a myriad of other initiatives. MG is committed to enhancing partners are warmly welcome to attend sustainable practices across the organisation through the (RSVPs are required for catering purposes delivery of five key sustainability factors: – details are included in the invitations to all shareholders distributed with the notice of the meeting).

REDUCING WASTE PACKAGING OUR PEOPLE

Over the past year we have worked The need to reduce, reuse and recycle We are actively engaged in the health hard to improve our waste diversion is of paramount importance to all our and wellbeing of our people. Our team and to improve recycling within our futures. We are constantly looking at has access to and support from Synergy branch network. Improving our waste ways to improve our packaging solutions Health’s Tracksuit Inc. website. This is control throughout our sites and working and are currently working on guidelines a web-based platform that encourages with our waste management partners to assist our grower suppliers, and to and supports healthy lifestyles through to better provide more accurate and provide packaging that is recyclable when education, information and reward- environmentally friendly collections, will packaging is necessary. Finding solutions based programmes which encourage improve our diversion from landfill into around alternate packaging that comply participation. To further support this our more recyclable streams. with a myriad of challenges, such as food branch sites actively encourage group safety, cost and practicality, will not be participation in physical based activities easy. It is a complex discussion, and will (various run/walk activities throughout no doubt take time to resolve, given the the year), as well as providing access to on-going influence of the consumer voice. affordable fresh fruit and vegetables.

REFRIGERATION ENERGY

We are constantly reviewing and planning With changes to both our lighting systems for anticipated change. A move to natural across the country and improvements and gas solutions has seen recent changes upgrades to our refrigeration plants we to some sites. All facilities will be are constantly looking at ways to improve progressively changed to environmentally our use of energy. sustainable solutions over time.

26 27 INCOME STATEMENT GROUP BALANCE SHEET GROUP 2018 Review Annual FOR THE YEAR ENDED 30 JUNE 2018 2018 2017 AS AT 30 JUNE 2018 2018 2017

$’000 $’000 $’000 $’000 Annual Review 2018

Revenue – sale of goods 525,054 570,413 Equity ®

Cost of sales 467,794 508,901 Share capital 29,498 26,129 Together. Stronger. Gross profit 57,260 61,512 Reserves 32,171 30,257 Other operating income 2,888 3,703 Retained earnings 35,451 54,572 Together. Stronger. Together. Administrative expenses 11,844 10,880 ® Total equity attributable to equity holders of the Parent Company 97,120 110,958 Other expenses 38,988 36,106 Non-controlling interest 10,027 18,720 Results from operating activities before other income and other expenses 9,316 18,229 Total equity 107,147 129,678 Other income – gain on acquisition 6,568 – Non-current assets Other expenses – impairment 32,330 – Property, plant and equipment 142,324 121,373 Results from operating activities (16,446) 18,229 Intangible assets 26,440 57,716 Finance income 83 51 Investments in equity accounted investees 8,922 6,277 Finance expense 2,973 2,954 Trade and other receivables 37 2,479 Net finance costs 2,890 2,903 Deferred tax assets 7,564 5,017 (Loss)/profit before equity earnings and income tax (19,336) 15,326 Total non-current assets 185,287 192,862 Share of profit of equity accounted investees 673 692 Current assets (Loss)/profit before income tax (18,663) 16,018 Inventories 9,766 7,326 Income tax expense 839 4,409 Trade and other receivables 51,823 63,904 (Loss)/profit for the year (19,502) 11,609 Cash and cash equivalents 9,253 13,035 Non-current assets held for sale 6,620 – Total current assets 77,462 84,265 Total assets 262,749 277,127 Non-current liabilities Borrowings 60,275 56,235 CASH FLOW STATEMENT Trade and other payables 964 925 FOR THE YEAR ENDED 30 JUNE 2018 Deferred tax liabilities 11,272 7,341 Total non-current liabilities 72,511 64,501 Net cash from operating activities 15,835 20,462 Current liabilities Net cash (used in) investing activities (20,589) (24,762) Borrowings 10,737 1,444 Net cash from financing activities 213 13,787 Trade and other payables 71,030 79,908 Net (decrease)/increase in cash and cash equivalents (4,541) 9,487 Taxation payable 1,324 1,596 Cash and cash equivalents at 1 July 13,035 3,476 Total current liabilities 83,091 82,948 Effect of exchange rate fluctuations on cash held 759 72 Total liabilities 155,602 147,449

Cash and cash equivalents at 30 June 9,253 13,035 Net assets 107,147 129,678

This annual review is a summary of the full annual report and financial statements. This annual review is a summary of the full annual report and financial statements. Copies of the full documents can be found on the MG website (www.mgmarketing.co.nz). Copies of the full documents can be found on the MG website (www.mgmarketing.co.nz).

28 29 STRATEGICALLY POSITIONED TO SUPPORT BRANCH REGISTER, BANK & ADVISORS 2018 Review Annual GROWERS THROUGHOUT THE COUNTRY Annual Review 2018 MG Market and Warehouse Facilities Te Mata Exports NEW ZEALAND Invercargill Brisbane Market 162 Mersey Street Building C – Brisbane Markets, 385 MG Subsidiaries and Associates United Flower Growers New Zealand Branches PO Box 209, Invercargill 9840 Sherwood Road

Phone: +64 3 218 2919 PO Box 48, Rocklea, QLD 4106, AUS ®

JS Ewers Auckland Together. Stronger. Manager: Lindsay Francis Phone: +61 7 3848 2999 National Banana Ripening First Fresh NZ & MG Direct (NI) Registered Office, Support Office, Melbourne Market 801-803 Great South Rd Marketing, Imports & MG Direct (SI) Stands 87, 89, 91-93, 95-97 PO Box 12 370, Penrose 78 Waterloo Road, Hornby 35 Produce Drive Together. Stronger. Together. Auckland 1642 ® Christchurch 8042 Epping, VIC 3076, AUS Phone: +64 9 601 8500 PO Box 8581, Christchurch 8440 Phone: +61 3 8405 4500 Branch Manager: Kerry Baird Phone: +64 3 343 0430 National Banana Adelaide Ripening: Graeme Hirst New Zealand Bank & Advisors C31 Adelaide Produce Markets Burma Road, Pooraka, SA, 5095, AUS Hamilton Bankers Phone: +61 8 8260 4188 24 Kaimiro Street Rabobank New Zealand Branch, (Primary Tauranga Pukete Industrial Estate facilities provider) Fresh Choice (W.A.) Pty Ltd Auckland PO Box 675, Hamilton 3240 Bank of New Zealand, Christchurch, E4 Central Trading Area, Market City Phone: +64 7 849 2866 (Transactional facilities – New Zealand) 280 Bannister Road Manager: Roger O'Sullivan Canning Vale, Perth, WA 6155, AUS Share Registrar Hamilton Phone: +61 8 9455 2355 Tauranga Computershare Registry Service Ltd, 86 Poturi Street, Tauriko Private Bag 92119, Auckland Sydney Market Stand 1-4 E Shed, Tauranga 3171 Legal Advisors PO Box 323, Sydney Markets PO Box 9426, Greerton 3142 Chapman Tripp, NSW 2129, AUS Phone: +64 7 262 0210 Barristers & Solicitors, Palmerston North Phone: +61 2 8754 9004/+61 2 8754 9900 Manager: Jared Woodcock Christchurch and Wellington

Palmerston North Auditors — Parent Company & Group USA I Mihaere Drive KPMG, Chartered Accountants Market Gardeners (USA) Inc. PO Box 9112, Terrace End Christchurch Palmerston North 4441 Market Gardeners (USA) Inc. Phone: +64 6 357 8076 5001 E Commercentre Drive Manager: William Little Bakersfield, California INTERNATIONAL CA 93309-1687, USA Nelson Wellington Phone: +1 661 322 4044 34 Jamaica Drive Australia Manager: Doug Trask B.BA Grenada North LaManna Premier Group PO Box 51 044, Wellington 5249 International Bank & Advisors Australia Registered Office Phone: +64 4 232 3499 103-107 Hyde Street Bankers Manager: Ben Ross Footscray, Vic 3011, AUS Rabobank Australia Branch Wellington (Primary facilities provider) Nelson Phone: +61 3 9687 7725 Australia and New Zealand Banking Group 30 Pascoe Street Group CEO: Anthony Di Pietro Ltd, Melbourne PO Box 170, Nelson 7040 Christchurch (Transactional facilities – Australia) Phone: +64 3 548 5859 Australian Banana Support Office Manager: Jamie Russ Company Pty Ltd 101-103 Upper Daradgee Road Legal Advisors Daradgee, QLD 4860, AUS Arnold Bloch Leibler, Christchurch Phone: +61 7 4063 1600 Melbourne 68 Waterloo Road, Hornby K&L Gates, Christchurch 8042 Melbourne PO Box 16 404, Christchurch 8441 Logie-Smith Lanyon, Phone: +64 3 349 2070 Melbourne Manager: Jeff Neumann Dunedin Auditors — LaManna Premier Group Dunedin Pitcher Partners, Cnr Midland & Otaki Streets Chartered Accountants PO Box 2056, Dunedin 9044 Melbourne Phone: +64 3 455 4004 Invercargill Manager: Wayne Hume

30 31 ® Together. Annual Review 2018

MG was established by a small band of resolute growers to leverage greater value for their produce. It was from these humble beginnings that the foundations were laid for a successful Together. Stronger. Together.

® co-operative that values the benefits of shared knowledge and collective capability. Today, MG represents 418 grower shareholders.

Stronger.

The ultimate benefits of working as one can be anything from greater financial security, to long-term business sustainability, to collegiality. Delivered through our strong branch network, industry knowledge and local understanding, MG is here to support the growth of all our grower shareholders.

32 Annual Review 2018 Together. Stronger. Together.