Strength throughAnnual Report and Accounts 2020 challenging times. INNOVATE COLLABORATE SUSTAIN OUR VISION To be the leading and trusted partner of choice to the farmers, growers and amenity professionals we serve. OUR PURPOSE Optimising sustainable agriculture and food production through innovation, research & development and agronomic expertise. LOCAL 320 EXPERTISE Strong Operational Team Agrii UK employs approximately 320 operational staff during the peak of the season to successfully support >2,600 its customers People Employed in 7 Countries + See Agrii UK Case Study on page 33 103 €64.3m Distribution of free cash fl ow Centres demonstrating strong cash generation + More on pages 35 >30 GLOBAL Farms attended daily by each of our UK delivery drivers at peak season COLLABORATION + More on pages 33 320 Strong Operational Team Agrii UK employs approximately 320 operational staff during the peak of the season to successfully support its customers + See Agrii UK Case Study on page 33 103 €64.3m Distribution of free cash fl ow Centres demonstrating strong cash generation GLOBAL COLLABORATION CONTENTS Strategic Report Governance Financial Statements At a Glance 6 Board of Directors 74 Directors and Other Information 114 Our Segments 7 Directors’ Report 76 Statement of Directors’ Chairman’s Statement 8 Chairman’s Overview 79 Responsibilities 115 Chief Executive’s Review 10 Corporate Governance Statement 81 Independent Auditors’ Report 116 Financial Review 12 Nomination and Corporate Consolidated Income Statement 124 Alternative Performance Measures 19 Governance Committee Report 88 Consolidated Statement Our Business 20 Audit and Risk Committee Report 91 of Comprehensive Income 125 Strategy 22 Remuneration Committee Report 95 Consolidated Statement Business Model 26 of Financial Position 126 Key Performance Indicators 28 Consolidated Statement Business Review of Changes in Equity 128 - Ireland and the United Kingdom 30 Consolidated Statement - Continental Europe 36 of Cash Flows 129 - Latin America 42 Group Accounting Policies 130 Sustainability Report 48 Notes to the Group Risk Report 64 Financial Statements 141 Company Accounting Policies 196 Company Balance Sheet 198 Company Statement of Changes in Equity 199 Notes to the Company Financial Statements 200 RISING TO THE CHALLENGE + More on page 45 We help farmers optimise crop yield and economic returns on a sustainable basis. + More on page 48 HIGHLIGHTS FY20 was a challenging year for the Group, however strong cash generation and reduced net debt leaves the Group in a solid financial position. > Group revenue decrease of 11.6% to > Strong cash generation with free cash €1,589.1 million, and 11.7% on an flow of €64.3 million (2019: €54.0 million) underlying1 basis > Reduction in net debt2 to €53.2 million > Operating profit of €44.1 million, a decrease (2019: €75.6 million) of 46.4% and 44.6% on an underlying1 basis > Working capital inflow of €30.3 million > Group operating margin of 2.8% (2019: Outflow of €12.7 million) (2019: 4.6%) > Suspension of final dividend with total > Adjusted diluted earnings per share dividend of 3.15 cent (2019: 21.32 cent) of 25.69 cent in line with guidance > Disposal of the Group’s 20% stake in Ferrari Zagatto, Brazil 1. Excluding currency movements and the impact of acquisitions. 2. Before the impact of IFRS 16 lease transition, as defined for banking covenant purposes. 2 Origin Enterprises plc Annual Report and Accounts 2020 Revenue Operating Profit1 €1,589.1m €44.1m (11.6%) (46.4%) (11.6%) at constant currency3 (44.5%) at constant currency3 Adjusted Diluted EPS2 Free Cash Flow 25.69c €64.3m (51.2%) (2019: €54.0m) (49.2%) at constant currency3 ROCE Dividend per Share 7.3% 3.15c (2019: 13.2%) (2019: 21.32 cent) 1. Before amortisation of non-ERP intangible assets and Note: All references to constant currency in this Annual Report are exceptional items, and before the Group’s share of due to the fact that the translation of non-euro denominated profits of associates and joint venture. earnings are impacted by movements in local currency rates versus 2. Before amortisation of non-ERP intangible assets, net of related the euro, the Group’s presentation currency. In order to reflect deferred tax (2020: €7.7m, 2019: €7.1m) and exceptional items, underlying performance more accurately in the period, the Group net of tax (2020: €5.2m, 2019: €7.0m). calculates results on a constant currency basis by retranslating 3. Excluding currency movements. non-euro denominated current year earnings at prior year exchange rates. 3 320 Agrii UK’s Operations Team + More on page 33 4 Origin Enterprises plc Annual Report and Accounts 2020 STRATEGIC REPORT At a Glance 6 Our Segments 7 Chairman’s Statement 8 Chief Executive’s Review 10 Financial Review 12 Alternative Performance Measures 19 Our Business 20 Strategy 22 Business Model 26 Key Performance Indicators 28 Business Review - Ireland and the United Kingdom 30 - Continental Europe 36 - Latin America 42 Sustainability Report 48 Risk Report 64 45,000 Crop Field Trials Strategic Report Governance Financial Statements 5 AT A GLANCE A focused Agri-Services group providing services and technology. 103 Our businesses specialise in Distribution Points the provision of independent and innovative advice, inputs and related services to farmers to help them optimise crop yield and economic returns on a sustainable basis. 70 Demonstration Farms Business-to-Business Integrated Agronomy Agri-Inputs and On-Farm Services Provides inputs and supply chain Provides agronomy advice, services solutions to the Irish, UK, Belgian and and inputs directly to arable, fruit and Brazilian primary food production vegetable growers in the UK, Poland, sectors covering the macro inputs Romania and Ukraine. Our customised 33 that drive on-farm efficiency, i.e. solutions ensure the delivery of crop Input Formulation prescription blended fertilisers, production systems that adhere to the and Processing Facilities speciality nutrition and animal feed highest safety, quality, environmental ingredients. In addition, Origin is a and sustainability standards. market leader in advisory, service and input provision to the professional Digital Agricultural Services sports turf, landscaping and amenity Provides bespoke digital agronomy sectors in the UK. applications and agri-tech services to primary producers, input manufacturers and agri-service companies. >2,600 Revenue Employees 2% 2% 37% 61% 34% 64% Ireland & the UK Continental Europe 2020 2019 Latin America €1.6bn €1.8bn 2020: 2020: 2019: 2019: Irl/UK: 61% Irl/UK: 61% Irl/UK: 64% Irl/UK: 64% CE: 37% CE: 37% CE: 34% CE: 34% 6 Origin Enterprises plcLATAM: Annual 2% ReportLATAM: and 2% Accounts 2020LATAM: 2% LATAM: 2% OUR SEGMENTS Latin America Ireland and the UK Continental Europe Latin America Ireland and the UK Continental Europe This segment includes the This segment includes the This segment includes the Group’s operations in Brazil. Group’s wholly-owned Irish Group’s operations in Poland, and UK based operations in Romania, Ukraine and addition to the Group’s Irish Belgium. and UK based associates and joint venture undertaking. + + + More on pages 42 to 47 More on pages 30 to 35 More on pages 36 to 41 Operating Profit 10% 16% 17% Ireland & the UK Continental Europe 2020 2019 Latin America €44.1m €82.3m 31% 53% 73% 2020 2020 2019 2019 Irl/UK: 53% Irl/UK: 53% Irl/UK: 73% Irl/UK: 73% CE: 31% CE: 31% CE: 17% CE: 17% Strategic Report LATAM: 16% LATAM: 16% GovernanceLATAM: 10% LATAM: 10% Financial Statements 7 CHAIRMAN’S STATEMENT Dear Shareholder FY20 Overview I am pleased to report that Origin Resilient performance in has delivered a resilient performance in 2020, through what has been a very challenging year due to the a very challenging year. COVID-19 pandemic and extreme localised weather conditions in certain Our people successfully countries in which we operate. Group revenue was €1,589.1 million, a sustained operations decrease of 11.6% and Group operating profit was €44.1 million, a decrease of 46.4%. The Group delivered free cash to support primary flow of €64.3 million, a working capital inflow of €30.3 million and a reduced food producers through net debt position of €53.2 million. Details of our financial performance COVID-19 pandemic. are set out in the Financial Review on pages 12 to 18. Leadership Changes After 13 years at the helm of Origin and 35 years with the Group, Chief Executive Officer Tom O’Mahony retired from his position on 30 June 2020. I would like to acknowledge and extend our appreciation of Tom’s leadership, dedication and unwavering commitment to the Company during his tenure. Tom led the Group through its journey from an Irish-focused business to an international agri- services organisation with a stock market listing. Sean Coyle, who joined as the Group’s Chief Financial Officer in September 2018, was appointed to the role of CEO with effect from 1 July 2020. We believe Sean is the right person to lead the Group forward through its next phase of growth and development and wish Sean every success in his role. I am pleased to welcome TJ Kelly as the new Chief Financial Officer. TJ comes from Hostelworld Group plc and will join Origin no later than March 2021. Strategy The Group’s strategy remains a key focus for the Board, particularly as we navigate the business through significant political, economic, environmental and industry changes, amidst the continuing COVID-19 pandemic and the uncertainties created by Brexit. Priorities for the year included driving forward our sustainability agenda, focusing on optimising our core businesses and maintaining financial stability against 8 Origin Enterprises plc Annual Report and Accounts 2020 a backdrop of challenging weather Company of our commitment in this Following a visit by the Board to conditions and COVID-19.