ANALYSTS‘ CONFERENCE...Financial Analysts' Conference 2016 08.03.2016 5 1. Key figures financial...

March 8th, 2016

Financial Year 2015

ANALYSTS‘ CONFERENCE

GROUP MANAGEMENT

08.03.2016Financial Analysts' Conference 2016 3

Dr. Dieter WeisskopfFinance, Administration, IT, Procurement, Operations

Rolf FalleggerFR, IT, UK, PL, CZ, RU, China

Andreas PflugerCEO Russell Stover, N/America, AUS

Uwe SommerMarketing, Sales, Global Retail,

Markets

Ernst TannerChairman & Group CEO


EXTENDED GROUP MANAGEMENT

Kamillo KitzmantelCH, Export, Duty Free

Thomas LinemayrUSA

Dr. Adalbert LechnerDE, AT

AGENDA


1. Key figures financial year 2015 E. Tanner

2. Markets

● North America A. Pfluger

● UK R. Fallegger

● Germany A. Lechner

● Switzerland K. Kitzmantel

3. Global Retail U. Sommer

4. Detailed financial figures 2015 D. Weisskopf

5. Outlook E. Tanner

6. Q&A

Financial Year 2015

KEY FIGURES

A CHALLENGING YEAR


Discontinuationof minimum

exchange rate EUR / CHF

High commodityprices (above all

cocoa)

Recession in oil-exportingcountries

Despite these challenges, Lindt & Sprüngli once again continuesto grow at a faster pace than the overall chocolate market

Unsettlingeffects of

terrorist threats

Concerns aboutdeflation and

unemployment

Very hot summerfollowed by

extremely mild start to winter

Challenges of the financial year 2015

P&L STATEMENT L&S GROUP


Organic growth of +7.1% and EBIT margin increase of +20 BP fully in line with long term guidance

CHF million 2014 2015 Growth in CHF

Sales 3 385.4 3 653.3 +7.9%Growth in Local CurrenciesOrganic Growth

+13.5%+7.1%

EBITDAMargin

588.017.4%

645.817.7%

+9.8%

EBITMargin

474.314.0%

518.814.2%

+9.4%

Net IncomeMargin

342.610.1%

381.010.4%

+11.2%

40 000

50 000

60 000

70 000

80 000

12.2014

01.2015

02.2015

03.2015

04.2015

05.2015

06.2015

07.2015

08.2015

09.2015

10.2015

11.2015

12.2015

Lindt registered share outperforming SPI by 27.1% in 2015

LINDT registered SPI adjusted

SHARE PRICE


Creating shareholder value: +30.5% in 2015

31.12.2014: LISN CHF 57’160

30.12.2015: LISN CHF 74’620 +30.5% y-o-y

SHAREHOLDER RETURN


Dividend payment of CHF 800 (reg.) or +10.3% vs. 2014 / continuous increase over the past 20 years

1992 2011 2012 2013 2014 2015*

Dividend Reg. (CHF) 39 500 575 650 725 800• From Agio 500 535 555 325 400

• From Retained Earnings 40 95 400 400

Increase (CHF) 50 75 75 75 75

Dividend Yield Reg. 1.4% 1.6% 1.7% 1.4% 1.3% 1.1%

Payout Ratio Reg. 16.9% 47.2% 53.1% 49.0% 49.0% 49.3%

Registered Shares(at year-end) 2 800 31 390 34 515 48 100 57 160 74 620

Market Capitalisation(CHF million) 492 6 982 7 384 10 268 12 495 16 338

* Subject to approval by the AGM

SALES ANALYSIS − MARKETS

08.03.2016 11

43.1%

13.5%

9.7%

9.1%

6.4%

5.5%

5.7%

7.0% Total NNTS CHF

3.653 bn● North America

● Germany

● France

● CH incl. Exports

● Italy

● UK

● Rest of Europe

● Rest of the World

Weight of sales in North America increasing from 36.8% to 43.1%

Financial Analysts' Conference 2016

Financial Year 2015

MARKETS

● North America

● Germany

● France


● Italy

● UK

● Rest of Europe


NORTH AMERICA


43.1%

13.5%

9.7%

9.1%

6.4%

5.5%

5.7%

7.0%NNTS (Sales)USD 1.627 bn

L&S NORTH AMERICA 2015


1994 2015

Sales (NNTS) USD 24 million USD 1.627 million

Market position > # 20 # 3

From newcomer to number 3 in the overall chocolate market

RUSSELL STOVER ACQUISITION − A MILESTONE


● RS optimally complements the brand and product portfolio of Lindt and Ghirardelli

● Strengthening of the number 1 position in the premium chocolate segment

● Rapidly growing number 3 in the American chocolate market

● Leading position in “Boxed Chocolates” and seasonal business

● Strong partner to the trade

● Strong basis for further growth

● Potential synergies in various areas of the supply chain

The integration of Russell Stover is progressing according to plan

RUSSELL STOVER ACQUISITION − A MILESTONE


● Positioning of the brand

● Further elimination of non-profitable businesses and promotions

● Adjustment of pricing structure

● Increasing pace of product innovation

● Strengthening of sales and marketing teams

● Tackling potentials in the area of supply chain management

● Locating / spotting synergies within the Lindt & Sprüngli Group

Priorities for Russell Stover in 2016

We strive to extend our leadership further in the attractive premium chocolate marketwith our well established brand and expand our leadership position

KEY LOCATIONS


Reno, NV

Lathrop, CAButler, MO

Cookeville, TN

Wildwood, FL

Terrell, TX

Chicago, IL

Carmel Church, VA

Carlisle, PA

Stratham, NH

Corsicana, TX

Montrose, CO

Abilene, KS

Iola, KS

San Leandro, CA

Kansas City, MO

Trenton

Calgary

Mississauga

Toronto, CAN

http://www.google.com/url?sa=i&rct=j&q=&source=imgres&cd=&cad=rja&uact=8&ved=0ahUKEwi09ba63ZXLAhXMSyYKHVqVD6EQjRwIBw&url=http://imageadorable.faith/lindt+logo&psig=AFQjCNEzPWTKSoWRwUmoFWPNrE6W-i-gcw&ust=1456586436469418


http://www.google.com/url?sa=i&rct=j&q=&source=imgres&cd=&cad=rja&uact=8&ved=0ahUKEwiqnO-u3ZXLAhWG4yYKHcc-Cw8QjRwIBw&url=http://www.ghirardelli.com/&psig=AFQjCNH6iphWb4bf_aMIzvjK08nWb4NnYA&ust=1456586411944548

http://www.google.com/url?sa=i&rct=j&q=&source=imgres&cd=&cad=rja&uact=8&ved=0ahUKEwiqnO-u3ZXLAhWG4yYKHcc-Cw8QjRwIBw&url=http://www.ghirardelli.com/&psig=AFQjCNH6iphWb4bf_aMIzvjK08nWb4NnYA&ust=1456586411944548



https://www.google.com/url?sa=i&rct=j&q=&esrc=s&source=images&cd=&ved=0ahUKEwjb5ur_o5bLAhWE5iYKHX9XBpMQjRwIBw&url=https://en.wikipedia.org/wiki/Flag_of_Canada&bvm=bv.115339255,d.eWE&psig=AFQjCNFHuQSUAieVYjPV8tadta-sf1zTVg&ust=1456605331144460

https://www.google.com/url?sa=i&rct=j&q=&esrc=s&source=images&cd=&ved=0ahUKEwjb5ur_o5bLAhWE5iYKHX9XBpMQjRwIBw&url=https://en.wikipedia.org/wiki/Flag_of_Canada&bvm=bv.115339255,d.eWE&psig=AFQjCNFHuQSUAieVYjPV8tadta-sf1zTVg&ust=1456605331144460

RUSSELL STOVER − SUMMARY


● Most important acquisition strategically and in size

● Integration into to the L&S Group well on track

● 2015/16 streamlining assortment and promotional activities

● Therefore 2015/16 lower sales growth focus on profitability

● In 2017 basis established for profitable growth

● Working on synergies and efficiencies between our 3 US companies

● Continue to grow the premium segment faster than the market

UNITED KINGDOM


43.1%

13.5%

9.7%

9.1%

6.4%

5.5%

5.7%

7.0%NNTS (Sales)GBP 136.0 million

● North America

● Germany

● France


● Italy

● UK

● Rest of Europe


UNITED KINGDOM 2016


● UK confectionery market is the 2nd largest in the world

● Confectionery remains one of the largest and most important categories in UK grocery and is bought byover 98% of UK households

UK Confectionery Market

● Sales GBP 136 million (+12.4% y-o-y)

● 4th year in a row double digit sales growth

● Helping retailers to differentiate range from discounters

Lindt & Sprüngli UK

§

FOCUS ON KEY FRANCHISES


● Lindor is one of the fastest growing brands in the UK and is now the 4th biggest Confectionery Brand and a Top 100 Brand in the UK market.

● Strong advertising developed for the UK market, effective sampling programs and excellent POS activation programs

● Excellence is the largest and fastest growing Dark Chocolate Brand in the UK

§

ENTERING INTO A NEW MARKET SEGMENT


● Countlines are the largest chocolate market segment in the UK

● With the launch of Lindor Treatbar we made a first entry into this untapped segment

● Initial results are promising and indicate major volume potential for Lindt & Sprüngli UK

§

LEADER IN SHOPPER MARKETING


● Lindt is partnering with Key Retailers on Shopper Marketing projects to create better shopper insightsand more efficient range selections. Lindt was voted number 1 in the Advantage Survey for CategoryManagement in the UK chocolate category.

● Strengthened Category Partnerships with the Key UK retailers based on understanding and segmentingthe UK Chocolate shopper and providing Category based solutions.

§

EXPANDING RETAIL & BUILDING THE BRAND


§

Fast expansion of the retail store portfolio to complement thewholesale business in key locations around the UK

Continuously strengthen the Lindt brand

L&S UK − SUMMARY


● UK, as the 2nd largest chocolate market in the world, is of utmost importance for Lindt &Sprüngli

● In 2015, despite a flat market, Lindt & Sprüngli sales grew at a double digit rate and stronglygained market share

● Focus is on our key franchises Lindor and Excellence, where we grow even faster than thecompany average

● With the Lindor treatbar, we are entering a new large market segment

● Lindt & Sprüngli UK is recognized as a leader in Shopper marketing

● We are rapidly expanding our Retail network and are constantly building our Brand awareness

GERMANY


NNTS (Sales)EUR 458.1 million

08.03.2016 26

43.1%

13.5%9.7%

9.1%

6.4%

5.5%

5.7%

7.0%

● North America

● Germany

● France


● Italy

● UK

● Rest of Europe


GERMANY 2015


● High per capita consumption at approx. 9 kg p.a.

● German confectionery market is the 4th largest in the world

● Moderate growth based on price increases

● Fierce price competition – historic highest number of discounters

German Confectionery Market

● € 458,1 million sales (NNTS) (+7,0 % y-o-y)

● Lindt with 7th year of consecutive gains in market shares

● Market leader in Easter and Christmas chocolates and pralinés gift boxes

Lindt & Sprüngli Germany

VALUE CREATION FOR THE TRADE


● Differenciation from hard discounters● Distinct price premium● High value creation● Innovations as growth driver (HELLO, Mini Pralinés, Teddy etc.)● Premium POS appearance

§

DOUBLE−DIGIT GROWTH OF KEY BRANDS


21

UNCOMPROMISED STRENGTHENING OF THE BRAND


● Uncompromised quality orientation● Consequent premium positioning● 360° deployment of the Master Chocolatier campaign● High pace of innovations● Brand experience at POS and in our retail stores

INNOVATION 2015: GOLD BUNNY SPECIAL EDITION


1

Rejuvenation of a classic

§

BRAND EXPERIENCE AT POS


● Extension of premium shelves

● Upgrades of the Lindt permanent locations

● Shop-in-shop initiatives in shopping malls and department stores

§

RETAIL − NEW LOCATIONS &STRENGTHENING OF THE BRAND


Berlin Heidelberg Dresden

L&S GERMANY − SUMMARY


● +7.0 % growth in 2015

● Healthy long-term trend

● Continuous gains in the market share

● Market leader in seasonal business and in praliné gift boxes

● Key range grow over-proportionally

● Innovations dynamize and rejuvenate the brand

● Extension of our retail divison

● Upgrading of our POS appearance

L&S SWITZERLAND


NNTS (Sales)CHF 359.0 million

08.03.2016 35

43.1%

13.5%9.7%

9.1%

6.4%

5.5%

5.7%

7.0%

● North America

● Germany

● France


● Italy

● UK

● Rest of Europe


Challenging Market Environment

§

§

FOCUS ON KEY FRANCHISES AND INNOVATION


Discontinuation ofminimum exchangerate EUR/CHF

Price discounts

Strong Growth of Key Franchises

LINDOR EXCELLENCE Milk-Range

Grand Plaisir

Innovation Power

Product strategy / focus

Selective distribution

200g „Blocks“ Milk-Range

Les Grandes

Declining Swiss chocolate market

FOCUS ON RETAIL EXPANSION


Lindt Shop JungfraujochLindt Shop Swiss Museum of Transport Lindt Shop Zermatt

STRENGTHENING THE SWISS PRODUCTION SITE


● Project «Swiss Fitness»: Efficiency improvements to support exportbusiness

● Increasing production capacities

● Strengthening and long-term commitment for swiss productionsite

L&S SWITZERLAND − SUMMARY


● Challenging market environment

● Focus on key franchises and innovation

● Selective distribution

● Focus on retail expansion, tourism

● Strong commitment towards Swiss production site

WELCOME TO THE NEW LINDT SHOP


Financial Year 2015

GLOBAL RETAIL

Vision

By 2020 we want to be theworld’s leading retailer of premium chocolate

STRATEGIC GOALS


● Retail to achieve profitable growth above group average● Strengthening of the Lindt Brand Equity● Master Chocolatier● Lindt Difference● Display of wide product range

● Gaining new clients and real Lindt fans

ACTIONS


● Building of a Global Retail Department (2009)● Development of globally multipliable shop concepts● Factory Shops● Outlet Shops● Boutiques● Cafés

● Definition of a shop specific product assortment (Focus: Pick & Mix)● Development of seasonal campaigns● Training guides for all Chocolate Advisors

RESULTS


● 325 shops worldwide● Sales CHF 378.5 million (+20% y-o-y)● ~1800 employees● Sampling of 40 million LINDOR balls● Strong development of the Lindt brand

209 NEW SHOPS SINCE 2009


North America2009: 542014: 1392015: 156

Europe2009: 552014: 1082015: 114

South America2009: 02014: 22015: 18

Australia2009: 62014: 122015: 18

South Africa2009: 02014: 22015: 4

Japan2009: 12014: 122015: 15

Total Shops 2009: 1162014: 275 2015: 325

MASTER CHOCOLATIER IN THE SHOPS


MASTER CHOCOLATIER − SHOP EVENTS


LINDT RETAIL − PICK & MIX


GLOBAL RETAIL − SUMMARY


By 2020 we want to be the world’s leading retailer of

premium chocolate

Strengthe-ning the Brand

Raising Brand

Awareness

Exclusive Product

Presentation/ Product

RangeUnique

Shopping Experience

Different Shop

Concepts

Global Presence

Financial Year 2015

DETAILED FINANCIAL FIGURES

SALES GROWTH − IN CHF


Continuation of high growth path

Absolute in CHF million (as published)

Growth Rate in % (as published)

2 4892 670

2 883

3 385

3 653

1 700

2 200

2 700

3 200

3 700

2011 2012 2013 2014 2015

17.4%7.3%-3.5% 7.8% 7.9%

SALES GROWTH − ORGANIC


Organic growth fully in line with long term goal (+6.0% to +8.0%)

Incease p.a. in local currencies (organic growth in %)

6.0%6.8%

8.6%

9.8%

7.1%

0%

1%

2%

3%

4%

5%

6%

7%

8%

9%

10%

2011 2012 2013 2014 2015

SALES − GROWTH FACTORS


3.8%

7.1%

13.5%

7.9%3.3%

6.4% -5.6%

0%

2%

4%

6%

8%

10%

12%

14%

Volume Price / Mix Organic RSC (FY Effect) Sales in LocalCurrency

Forex Sales in CHF

Balanced growth between volume and price / mix

ORGANIC GROWTH BY SEGMENT


5.4%

7.9%

11.4%

0%

2%

4%

6%

8%

10%

12%

Europe NAFTA All other

MATERIAL COSTS


Material costs including inventory-changes decreased by -60 BP

Abolute in CHF million

In % Sales

892.4 940.0 943.2

1 227.91 306.0

0

200

400

600

800

1 000

1 200

1 400

2011 2012 2013 2014 2015

35.9% 35.2% 32.7% 36.3% 35.7%

NUMBER OF EMPLOYEES (FTE)


Increase by 2‘468 employees mainly driven by Russell Stover

Average number of employees (FTE)

7 779 8 1578 949

10 712

13 180

3 0004 0005 0006 0007 0008 0009 000

10 00011 00012 00013 00014 000

2011 2012 2013 2014 2015

+207 +378 +792 +1 763 +2 468

540.5599.6

654.7719.5

807.1

0

200

400

600

800

2011 2012 2013 2014 2015

PERSONNEL EXPENSES


Increase in the expense ratio due to Russell Stover

In CHF million

In % Sales

21.7% 22.5% 22.7% 21.2% 22.1%

OPERATING EXPENSES


Continued good support of marketing investments in 2015

Absolute in CHF million

In % Sales

644.1707.9

794.9868.2

912.3

0

200

400

600

800

1 000

2011 2012 2013 2014 2015

25.9% 26.5% 27.6% 25.6% 25.0%

OPERATING PROFIT (EBIT)


Increase in EBIT Margin by +20 BP to 14.2% (EBITA of 14.4%)

328.7 330.1

404.1

474.3518.8

0

100

200

300

400

500

2011 2012 2013 2014 2015

Absolute in CHF millionIn % Sales

13.2% 12.4% 14.0% 14.0% 14.2%

EBITDA


Absolute increase by +9.8%

422.0 435.9

503.3

588.0645.5

0

100

200

300

400

500

600

700

2011 2012 2013 2014 2015


In % Sales

17.0% 16.3% 17.5% 17.4% 17.7%

CAPITAL INVESTMENTS


Record high investments to cope with volume growth


104.2

144.6

191.4

234.6252.8

0

40

80

120

160

200

240

2011 2012 2013 2014 2015

DEPRECIATION AND IMPAIRMENTS


Depreciation to sales ratio remaining stable despite high investments

93.2105.8

99.2

113.7

127.0

0

20

40

60

80

100

120

140

2011 2012 2013 2014 2015

Absolute in CHF millionIn % Sale

3.7% 4.0% 3.4% 3.4% 3.5%

TAX RATE


Decrease in 2015 due to tax optimization

In % of income before taxes

25.0% 25.6% 24.5%

27.5%25.5%

0%

10%

20%

30%

2011 2012 2013 2014 2015

NET INCOME


Increase in net income margin by +30 BP to 10.4%

246.5 244.9

303.0

342.6

381.0

0

50

100

150

200

250

300

350

400

2011 2012 2013 2014 2015


In % Sales

9.9% 9.2% 10.5% 10.1% 10.4%

NET FINANCIAL POSITION − DEVELOPMENT


Decrease of net debt thanks to good cash flow generation

Net Cash in CHF million

-844

-681

489

-253

-166 94 -1

-1 000

-500

0

2014 Operating Cash Flow Investment Activities Dividend Capital Increase &Treasury Stock

CTA / Other 2015

BALANCE SHEET


3 002

3 490

2000

2500

3000

3500

2014 2015

53.8% 55.7%

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

2014 2015

-844

-681

-850

-650

-450

-250

-50

2014 2015

Strong equity after acquisition impact

Equity in CHF million Equity B/S Ratio in % Net Financial Position in CHF million

OUTLOOK

OUTLOOK ENVIRONMENT 2016


● Ongoing high prices for cocoa beans and cocoabutter

● Worldwide weak growth in the chocolate market● Continued weak economic environment

● however,● Signs of improvement in consumer sentiment in

parts of Europe and North America● Premium chocolate market continues positive trend

● Innovation and intensified marketing communication to continuous strengthening of Lindt brand in all markets

● Continuous focus on the worldwide implementation of own sales channel (Global Retail)

● Full integration of Russell Stover in the Lindt Group

● Realization of cost synergies after the integration of Russell Stover in North America

● Ongoing optimization via efficiency increases and cost management

● Confirmation of mid- to long-term targets:

− organic sales growth: 6-8% (1H2016 at lower end)

− Increase in EBIT margin +20 – 40 BP p.a.

Ongoing challenging general conditions Lindt & Sprüngli – Strengthening the brand, continuous increase of market shares, expansion into new markets

Financial Analysts‘ Meeting / March 8th, 2016

DISCLAIMER


This presentation contains forward looking statements which reflect Management‘s current

views and estimates. The forward looking statements involve certain risks and uncertainties

that could cause actual results to differ materially from those contained in the forward looking

statements. Potential risks and uncertainties include such factors as general economic

conditions, foreign exchange- and commodity price fluctuations, competitive product and

pricing pressures and regulatory developments.

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