Sustainable management Integrated Annual Report 2018 | 19 Contents 01 AGRANA at a glance 01 Key financials 12 Letter from the CEO 14 Supervisory Board’s report 16 AGRANA’s Management Board 18 Corporate governance report 28 Our locations 30 AGRANA’s strategy 32 AGRANA in the capital market 35 Group management report 36 Organisational structure 40 Non-financial information statement 50 Financial results 58 Fruit segment 65 Starch segment 72 Sugar segment 79 Research and development 83 AGRANA’s people 88 Risk management 94 Capital, shares, voting rights and rights of control 95 Outlook 97 Consolidated financial statements 98 Consolidated income statement 99 Consolidated statement of comprehensive income 100 Consolidated cash flow statement 101 Consolidated balance sheet 102 Consolidated statement of changes in equity 104 Notes to the consolidated financial statements 171 List of members of AGRANA’s boards 172 Statement by the members of the Management Board 173 Independent auditor’s report 177 Independent assurance report 179 Other information 180 Parent company income statement 181 Parent company balance sheet 182 Proposal for the appropriation of profit 183 Glossary of industry and trade terms 190 Contacts 191 GRI content index 196 Performance indicators and their meaning f Contents 2018|19 at a glance █ Revenue: € 2,443.0 million (–4.8%; prior year: € 2,566.3 million) █ Operating profit (EBIT): € 66.6 million (–65.1%; prior year: € 190.6 million) █ EBIT margin: 2.7% (prior year: 7.4%) █ Profit for the period: € 30.4 million (–78.7%; prior year: € 142.6 million) █ Earnings per share: € 0.411 (–81.7%; prior year: € 2.241) █ Equity ratio: 59.0% (prior year: 61.7%) █ Gearing ratio2: 22.9% (prior year: 16.0%) █ Dividend proposal of € 1.001 per share (prior-year dividend: € 1.1251 per share) █ Number of employees (FTE)3: 9,230 (+6.4%; prior year: 8,678) Quick facts about AGRANA █ World market leader in the production of fruit preparations █ Largest manufacturer of fruit juice concentrates in Europe █ Major European producer of custom starch products and bioethanol █ The leading sugar manufacturer in Central, Eastern and Southeastern Europe █ 58 production sites4 in 26 countries around the world Financial calendar for 2019|20 13 May 2019 Results for full year 2018|19 (annual results press conference) 25 Jun 2019 Record date for participation in Annual General Meeting 5 Jul 2019 Annual General Meeting in respect of 2018|19 10 Jul 2019 Ex-dividend date 11 Jul 2019 Results for first quarter of 2019|20 11 Jul 2019 Record date for dividend 12 Jul 2019 Dividend payment date 10 Oct 2019 Results for first half of 2019|20 14 Jan 2020 Results for first three quarters of 2019|20 1 After the four-for-one stock split performed in July 2018. The value is thus based on the new number of shares outstanding at 28 February 2019, which was 62,488,976. 2 Debt-equity ratio (ratio of net debt to total equity). 3 Average number of full-time equivalents in the reporting period. 4 Number of sites as of 28 February 2019; also see from page 28, “Our locations”. Key financials 2018|19 2017|18 2016|17 2015|16 2014|15 Financial performance1 Revenue €m 2,443.0 2,566.3 2,561.3 2,477.6 2,493.5 EBITDA2 €m 147.7 254.2 235.2 192.0 181.9 Operating profit before exceptional items and results of equity-accounted joint ventures €m 51.1 164.1 150.8 107.5 102.0 Share of results of equity-accounted joint ventures €m 12.2 29.4 30.6 24.5 25.4 Exceptional items €m 3.3 (2.9) (9.0) (3.1) (5.7) Operating profit [EBIT]3 €m 66.6 190.6 172.4 129.0 121.7 EBIT margin % 2.7 7.4 6.7 5.2 4.9 Profit before tax €m 51.2 176.2 154.5 104.4 116.5 Profit for the period €m 30.4 142.6 117.9 80.9 84.6 Attributable to shareholders of the parent €m 25.4 140.1 111.3 82.7 80.9 Attributable to non-controlling interests €m 5.0 2.5 6.6 (1.8) 3.7 Operating cash flow before changes in working capital €m 177.5 302.7 258.0 225.9 208.1 Investment4 €m 183.8 140.9 114.7 116.0 91.2 Number of employees5 9,230 8,678 8,638 8,510 8,550 Return on sales6 % 2.1 6.9 6.0 4.2 4.7 Return on capital employed7 % 2.9 9.7 9.0 6.7 6.7 Share data at last day of February Closing price € 17.40 8 99.10 106.00 80.50 80.51 Earnings per share9 € 0.418 8.97 7.13 5.82 5.70 Dividend per share9 € 1.00 8, 10 4.50 4.00 4.00 3.60 Dividend yield % 5.710 4.5 3.8 5.0 4.5 Dividend payout ratio % 243.910 50.2 56.1 68.7 63.2 Price/earnings ratio 42.4 11.0 14.9 13.8 14.1 Market capitalisation €m 1,087.3 1,548.2 1,656.0 1,143.3 1,143.4 Number of shares ’000 62,489.0 15,622.2 15,622.2 14,202.0 14,202.0 Financial strength Total assets €m 2,389.4 2,356.4 2,481.4 2,243.2 2,406.9 Share capital €m 113.5 113.5 113.5 103.2 103.2 Core non-current assets11 €m 1,229.8 1,138.5 1,113.8 1,002.2 1,093.4 Equity €m 1,409.9 1,454.0 1,411.9 1,200.1 1,194.4 Equity ratio % 59.0 61.7 56.9 53.5 49.6 Net debt €m 322.2 232.5 239.9 405.8 330.3 Gearing ratio12 % 22.9 16.0 17.0 33.8 27.7 1 Detailed information concerning the calculation methods of individual performance indicators can be found on page 196. 2 EBITDA represents operating profit before exceptional items, results of equity-accounted joint ventures, and operating depreciation and amortisation. 3 Operating profit (EBIT) is after exceptional items and results of equity-accounted joint ventures. 4 Investment represents purchases of property, plant and equipment and intangible assets, excluding goodwill. 5 Average number of full-time equivalents in the reporting period. 6 Profit before tax, divided by revenue. 7 Operating profit before exceptional items and results of equity-accounted joint ventures, divided by capital employed. 8 Reflecting the four-for-one stock split performed in July 2018. 9 Based on the number of shares outstanding at the balance sheet date of the respective year. 10 Based on the dividend proposal to the Annual General Meeting on 5 July 2019. 11 Non-current assets excluding deferred tax assets and the item “receivables and other assets”. 12 Ratio of net debt to total equity. FRUIT. STARCH. SUGAR. Integrated Annual Report 2018 | 19 of AGRANA Beteiligungs-AG for the year ended 28 February 2019 In this annual report, AGRANA fulfils its obligation under the Austrian Sustainability and Diversity Improvement Act (also known in German as NaDiVeG) to prepare a “non-financial information statement” in accordance with section 267a Austrian Commercial Code. This statement is provided from page 40. It is based on the framework of the Global Reporting Initiative (GRI) and has been prepared in accordance with the GRI Standards: Core option. In this annual report on the 2018|19 financial year, the reporting of the sustainability topics that are material to AGRANA’s business activities is integrated directly in the corporate governance report and Group management report. To make the non-financial information easier to find, the relevant passages are cross-referenced in the non-financial information statement, and a content index of all GRI disclosures in the report (by individual GRI Standard addressed) is provided from page 191. In addition, relevant passages are marked with a green finger- print on the respective pages. Bioplastics reduce plastic waste lastics are one of the greatest contributors to pollution worldwide today. Of the approximately 8.3 billion tonnes of plastic1 produced P from 1950 to 2015, about 30% is still in use. Only 10% was recycled or destroyed. Most of the remainder – 60% – resides in landfills or in nature. In Austria alone, 5,000 tonnes of plastic waste end up in the environment every year. Our new bioplastic product, AGENACOMP®, is compostable and helps reduce plastic waste, while opening up additional market opportunities for us amid the planned ban on non-degradable plastic bags in Austria. Innovation and vision coupled with environmentally responsible action, as enshrined in our corporate philosophy, ensure sustainable opportunities for our environment and AGRANA. 0% microplastic Bioplastics: residues 100% home- compostable »As a first in the bioplastics market, here is a thermoplastic starch product that is completely compostable at home. The TÜV-certified composting tests resulted in 100% decom- position without microplastic residues. In addition, bio-based plastics contribute to the reduction of greenhouse gases, as they are made from renewable raw materials.« JOHANN MARIHART CEO of the AGRANA Group 1 Bren School of Environmental Science and Management, University of California, Santa Barbara: Production, use, and fate of all plastics ever made, Roland Geyer, 2017. 3 TRANSPARENCY AND NATURALNESS eople today are increasingly mindful of their We offer certified non-GMO sugar – assuring this with actions and try to live healthier lives. They feel a our own seeds and all the way to the product itself, P responsibility towards themselves, their fellow “Wiener Zucker”.