Comvita 2019 Annual Shareholders’ Meeting

ANNUAL SHAREHOLDERS’
MEETING
1 7 O c t o b e r 2 0 1 9

This presentation is given on behalf of Comvita Limited. Information in this presentation:
•Shouldbe read in conjunction with, and is subject to, Comvita’sAnnual Reports, Interim Reports and market releases on NZX;
•Is from audited financial statementsfor the year ended 30 June2019;
•Includes non-GAAP financial measures such as Operating (Loss)/Profit and Operating EBITDA. These measures do not have a
standardised meaning prescribed by GAAP and therefore may not be comparable to similar financial information presented by
other entities. They should not be used in substitution for, or isolation of, Comvita’saudited financial statements. We monitor
these non-GAAP measures as key performance indicators and we believe it assists investors in assessing the performance of the
core operations of our business. A reconciliation of NPAT to NPAT operating can be found in our Investor Presentation released on
the NZX on 23 August 2019.
•May contain projections or forward-looking statements about Comvita. Such forward-looking statements are based on current
expectations and involve risks and uncertainties.Comvita’sactual results or performance may differ materially from these
statements;
•Includesstatements relating to past performance, which should not be regarded as a reliable indicator of future
performance;
•Is for general information purposes only, and does not constitute investmentadvice;
•Is current atthedate of this presentation, unless otherwise stated.
While all reasonable care has been taken in compiling this presentation, Comvita accepts no responsibility for any errors or omissions.
All currency amounts are in NZ dollars unless otherwise stated.
IMPORTANTNOTICE
2

•Welcome –Neil Craig
•Chairman’s Address –Neil Craig
•Executive Director’s Review
•Reports and Financial Statements
•Resolution 1: Comvita Constitution
•Resolution 2:Appointment
andRemuneration of Auditors
•Resolutions3 -7: Director Elections
•General Business
•Afternoon Tea
AGENDA
3

4
FY19 Financial Results
-Year in Review
-Key Financial Results
Other Notifiable Events
-Plantation Strategy
-Purchase of China distribution company
-Strategic and Organisational Review
CHAIRMAN’S ADDRESS

A YEAR OF SIGNIFICANT CHANGE IN OUR TRADING
ENVIRONMENT –a perfect storm was brewing
5
SUPPLY
•The new MPI regulations cannot be enforced ‘in-market’ and do not apply
domestically, i.e. they only apply to honey packed in NZ and exported.
•New regulations had effect on the wholesale price of multiflora honey falling 60% in
12 months causing most apiaries to lose money.
•Yet Multifloral Manuka (allowed by regulation) competes directly with Monofloral
Manuka –result is ‘unfair competition’ in-market and consumer confusion. Comvita
does not sell Multifloral Manuka.
•Until rules are ‘tidied up’ (and we are working with industry bodies and MPI to do this)
the only real protection to consumers wanting to buy genuine Manuka honey, is to buy
Monofloral Manuka packed in NZ.
•Inclement weather impacts honey harvest third year in a row.Also over-crowding of
hives chasing Manuka honey –Comvita apiary business runs at a significant loss.

A YEAR OF SIGNIFICANT CHANGE IN OUR TRADING
ENVIRONMENT –a perfect storm was brewing
6
MARKETS
China announces new rules for cross-border e-commerce (applied January 2019).
•Daigou cross-border e-commerce (CBEC) trade out of Australia and NZ (ANZ) disrupted.
•Comvita’s sales in ANZ decline by $13m over prior year.
•Daigou channels still important, but greater emphasis now on CBEC and direct sales to
China.
Poor US Market Sales
•Large US customer places no orders for all of FY19.Sales in US down -$13m for the full
year.
•Orders reinstated for current year and other channels opening up.

FULL YEAR OPERATING RESULT
7
$
$
TOTALREVENUE
$171m
OPERATING (LOSS)
/ PROFIT AFTER TAX *
$(7.6)m
2018 $178
2018 +$9.3m
* Operating (Loss)/Profit after Tax is a non-GAAP measure. We monitor this as a key performance indicator and believe it assistsinvestors in assessing the performance of the
coreoperations of our business.

R E P O RT E D F I N A N C I A L
R ES ULTS
8
For the year ended
30 June
2019
30 June
2018
Total revenue$171m$178m
EBITDA operating*$0.0m$21.6m
Equity earnings$0.4m$1.9m
Net (loss)/profit after tax –NPAT$(27.7)m$8.2m
NPAT (loss)/profitnon-operating items$(20.1)m$(1.1)m
NPAT (loss)/profit operating*$(7.6)m$9.3m
•Impairments recognised
followingrecentunfavourable honey
seasonsand the interimconclusions from
thecurrent strategicreview
•FY19 goodwillimpairment:
•Australia $15,607,000
•Europe $2,027,000
•Apiaries $2,191,000
•FY19 equity accounted investees impairment:
•PutakeGroup$2,300,000
FAIR VALUE OF
ASSETS
*EBITDA operating: earnings before interest, tax, depreciationandamortisationand adjusted for non-operating items. EBITDA and NPAT operating are non-GAAP
measures. We monitor these as a key performance indicators and believe it assists investors in assessing the performance of the core operations of our
business.

•Secure inventory position going into new season
•Raw materials(mainlyUMF Manukahoney):
•30 June 2019,$84m
•30 June 2018,$89m
•Finishedgoods:
•30 June 2019, $48m (includes China)
•30 June 2019, $26m (excludes China)
•30 June 2018, $26m
•Trade receivables down $25m
•Net debt down to $89m from $104m at the half
year, and $92m at the same period last year
INVENTORY AND DEBT
9
Balance Sheet
30 June
2019
$’000
30 June
2018
$’000
Total assets310,638318,567
Total inventory132,192116,492
Trade receivables30,87855,813
Working capital155,162167,942
Net debt88,93691,753
Total equity173,355189,692
Net debt to equity ratio51%48%
Weighted average shares on issue46,30244,981

•Positive operating cash inflow of $21.1m
•Investment activities $17.7m:
•Capacity building
•State of the art warehousing capacity at
Paengaroa
•Acquired20% stake in Apiter, Uruguayan
Propolis manufacturer
•Acquired Daykel Apiaries (preeminent queen
bee genetics business)
•Factory upgrade
•Land andplanting forManuka plantations
CASHFLOW
10
Cash flow
movements
30 June 2019
$’000
30 June 2018
$’000
Movement
$’000
Operating activities21,086(22,118)43,204
Investing activities(17,704)(6,991)(10,713)
Financing activities2,23929,379(27,140)
Netmovement5,6212705,351
10

11

•51%acquired inJuly2017
•Remaining49%acquired31 May2019
•Business combination achievedin stages
•4,050,000 sharesissued as part consideration,
balance was $3m in cash
•100% Comvita China will be the key part of Comvita’s
profitable growth for the next few years. It will allow
greater control and flexibility in-market and
synchronisation of pricing and marketing through all
channels into China
INVESTMENT ACTIVITY
CHINA ACQUISITION
12

IMPACT ON CVT SHARE PRICE
13
0
1
2
3
4
5
6
Dec-18Jan-19Feb-19Mar-19Apr-19May-19Jun-19Jul-19Aug-19Sep-19
Share Price
17/12Removed
from S+P NZX50
SHARE PRICE DECEMBER 2018 TO SEPTEMBER 2019
26/02
Interim result
10/04China
Acquisition
06/05Market
update
06/06CEO resigns,
strategic review
23/08Full
year result

BOARDOFDIRECTORS
14
SarahKennedy
Independent Director
Head of Remuneration,
People & Culture Committee
Paul Reid
Independent
Director
BrettHewlett
Deputy Chairman
ExecutiveDirector
(effective 6 June 2019)
NeilCraig
Non-ExecutiveChairman
Luke Bunt
Independent Director
Head of Audit & Risk
Committee
Bob Major
Independent Director
(effective 1 September 2019)
MurrayDenyer
Independent Director
Head of Remuneration, People &
Culture Committee
(resigned 16 August 2019)
Xin Wang
Independent Director
(resigned 2 April 2019)

15
BRET T HEWLET T
EXECUTIVE DIRECTOR
STRATEGIC AND ORGANISATIONAL
REVIEW

16
•Immediate corrective actions
•Demand side focus areas
•Looking for supply chain efficiencies
•Changes to leadership
•Organisation structure
•FY20 Outlook
REVIEW

IMMEDIATE CORRECTIVE ACTIONS
Better, before bigger
17
DEMAND SIDE
•Focus Markets
•China
•North America
•Manage the correction in ANZ and establish
newchannels that are moresustainable
•Modify distribution models for efficiency in
other markets where Comvita has a good
position
•Restructure accordingly Supply/Demand
•Reduce operating overheadcosts
•Innovate from the core and seek to add value
to our Consumer in everything we do...
SUPPLY SIDE
•Adjust hive numbers to suit best wild harvest
Manuka resource
•Scale the plantation model to build more
sustainable Manuka farming practises
•Target constant improvements in productivity
and efficiencies of supply chain
•Exit from underperforming joint ventures
•Optimise margin by smart raw honey
purchasing and inventory management
•Seek to become the most efficient and
economically sustainable producer of high
quality raw materials and ingredients in the
industry...

* Represents in-market sales of the China entity which are not included in Comvita group revenue up
until 31 May 2019 as equity accounted
FOCUS MARKETS STRATEGY
CHINA*$52m
2018 $46m*
18
ASIA $41.3m
2018 $36.8m
AUSTRALIA/NZ $69.6m
2018 $82.6m
NORTH AMERICA $13.4m
2018 $26.8m
EUROPE $6.2m
2018 $8.7m
G ROW
G ROW
H O L D
C O N S O L I DAT E
H O L D

CHINA
19
•World’s fastest growing consumer market and NZ’s
#1 trading partner
•Now 100% owner of Chinese Comvita company
•#1 Manuka honey brand developed over 16+ years
•Chinese are large consumers of honey –taken for
health reasons
•Chinese partner, now our largest shareholder
•Targetinggrowth inside China, online andoffline
where theComvita brand is very strong
•Strategy starting to impact –initial drop in ANZ
sales now starting to convert to China and CBEC
FY19FY18FY17
Sales ($’000)52,09645,696N/A
Current Chinese Total Addressable Market (TAM) for
Manuka honey is estimated at US$1b
G ROW

NORTH AMERICA
20
•Largest consumers of honey and premium
natural health products in the world
•Costco has been an effective beachhead
customer
•Build market share of premium honey market.
Value add and convenience products focus
•Build distribution reach into premium retail
and online channels
•Comvita Kids Elixirs and Soothing Pops listed in
Whole Foods premium retailer and CVS pharmacy
stores, going into stores now
FY19FY18FY17
Sales ($’000)13,361 26,835 3,846
Current US Total Addressable Market (TAM) for Manuka
honey is estimated at US$320m
G ROW

AUSTRALIA &
NEW ZEALAND(ANZ)
21
•Decline in sales to smaller daigoure-sellers as
Chinese government tightens rules on informal
e-commerce traders
•New honey standards confusing/disrupting
•Sales balance is changing:
•Over time we expect to see sales in ANZ
slow as regulatory impacts continue to affect
daigou re-sellers
•Increasingdirect sales to CBECplatforms
•Increasing sales inside our China business
•ANZ channels to market will evolve
FY19FY18FY17
Sales ($’000)69,56282,55764,929
H O L D

ASIA
22
•Hong Kong impacted by civil unrest. Remains a
premium gateway market for tourists and locals
•Shared resources and cost efficiencies between
mainland China and Hong Kongorganisation
•Continued growth in Korea and Japan through
increased online and offline distribution
•Japandigital focus in Rakuten targeting increasing
into broader distribution both in digital and
wholesale
•Korea had strong growth in e-commerce and
duty-free
FY19FY18FY17
Sales ($’000)41,26136,81332,363
H O L D

EUROPE
23
•Still battling with adoption of MPI quality standards
in the UK and dysfunctional competitor behaviour
•Brexit issues to contend with
•New distribution channels in Germany –a cleaner
market
•Looking to stabilise and will review options in 2020
FY19FY18FY17
Sales ($’000)6,211 8,664 7,395
C O N S O L I DAT E

$108m
$4m
$10m
(2 0 1 8 : $ 4 2 m)
(2 0 1 8 : $ 1 3 2 m )
P E R S O N A L C A R E
M E D I C A L
$38m
PRODU C T S EG ME NTS OF TOTA L SA L ES
(2 0 1 8 : $ 5 m )
H E A L T H C A R E
(2 0 1 8 : $ 7 m )
F U N C T I O N A L
F O O D S
68
%
24
%
2
%
6
%
24

25
•MPIintroduced newexport standards for Manuka honeyin
February 2018
•Monofloral Manuka
•Multifloral Manuka
•Comvitasupports the focus on highUMF Monofloral Manuka
honey as the only sustainable strategic option.
•Improvements to the standards are needed:
•The NZ domestic market does not enforce the MPI
standard, some companies have used this as an
opportunity to clear non-compliant inventory.
NZ needs to adopt the MPI standard.
•MultifloralManuka should be removedfrom
thestandard. It confuses consumers andwill
impedelong-term value creation for the industry.
•Impact of MPI standard has been:
•Multifloral Manuka is competing directly against the
genuine Monofloral Manuka in the UMF 5+ category.
•Non-compliant honey stocks have been cleared in the
NZ market disrupting sales of genuine product.
•Non-Manukahoney prices have fallen by as much as
60%. This has impactedapiary profitability.
MPI HONE Y STA NDA R DS

26
•Extensive post-harvestanalysis has been carried out
on the performance of all Manuka sitesto ensure
onlythe most productive are retained.
•A staged transition to Comvita plantations for a more
intensive and efficient form of apiary management will
evolve.
•AcquiredDaykelqueengenetics enterprise providing
access to improved bee genetics which can have a
significant bearing on honey harvest productivity.
•Third party suppliers represent 65% of our honey
supply. We are not solely reliant on Kiwi Bee Apiaries
for all our Manuka honey supply.
HONEY SUPPLY
KIWI BEE APIARIES

27
•Our best defence against loss of productivity
on wild sourced Manuka honey is to grow our
own,with scale.
•2,100 hectares planted during FY19 with 2.3 million
trees​.
•In total 4,100 hectares of plantations with a
combined potential annual harvest of 115 tonnes
ofhigh grade Manuka honey​.
•Breeding programme advancing. Now propagating
third generation high performing cultivars​.
•2.7 million trees currently in nurseries ready for
planting next winter.
HONEY SUPPLY
PLANTATIONS
27

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PROPOLIS SUPPLY –
INVESTMENT IN APITER
28
•In July 2018, Comvita purchased 20% share of
Apiter, South America’s largest manufacturer of
Propolis.
•The investment in Apiter removes our future
supply constraints for this key ingredient and
provides us with manufacturing capability
including a newmedical grade laboratory and
productionplant.
•With a combination of NZ and Uruguayan
sourced propolis Comvita has secured supply to
meet a 5x increase in demand.

29
OLIVE LEAF EXTRACT
SUPPLY
29
•Sustainable farming practices introduced
•Small capital expenditure to improve
operating efficiency and productivity
•Olive Leaf Extract capacity sufficient to
meet a 5x increase in demand
•#1 brand in Australia

CORE ELEMENTS OF COMVITA STRATEGY: REFOCUS
1. GROW SUPERIOR SUPPLY
•Security of high quality,
market compliant raw
materials
•Most efficient and
productive producer in
the industry
2. WIN WHERE IT COUNTS
•Focused distribution in
targeted markets
•Channels optimised for
profitability and consumer
intimacy
3. INVESTING IN OUR BRAND
•So more people know and
love our brand
•Innovate from the core
•Market led
30

ORGANISATIONAL REVIEW: NEW COMPANY STRUCTURE
31
•Delineation between Brand and Supply
•New Leadership structure
•Flatter, leaner organisation
CEO
MARKETS
Activation, Consumer engagement
BRAND
Brand and product strategy. Delivery focus
SHARED SUPPORT SERVICES
Enablement of business outcomes
SUPPLY
Core ingredient platforms. Sourcing and supply

32
STRATEGIC REVIEW SUMMARY
•Investing for profitable growth in focused markets
of China and North America
•Looking to improve productivity and remove costs
from supply chain in general
•There is a new ‘norm’ for Manuka farming and we
are leading the way
•We will adopt a new organisation model that is
more focused, flatter and leaner than before
•Targeting to appoint a new CEO before end of 2019
•We are evolving the Board to lead the changes
required

33
OUTLOOK FOR FY20
•A year to stabilise, reset andrefocus.
•We are aiming to be back in the black this
financial year on modest growth in revenue.
•We will generate cash and pay down debt.
•We will lay down solid foundations under a new
CEO for a rebound in FY21.

34
RESOLUTIONS

35
•Formalities
Reports and Financial Statements
•Resolutions
•Adoption of new constitution
•Appointment and remuneration of
Auditors
•Director Elections
•Re-elect Mr. Paul Reid
•Re-elect Ms. Sarah Kennedy
•Elect Mr. Bob Major
•Elect Mr. Zhu Guangping
•Elect Mr. Cheng Dayong
RESOLUTIONS

36
RESOLUTION 1:
COMVITA CONSTITUTION
To consider, and if thought fit to pass,
the following special resolution:
“ThattheexistingConstitutionof
ComvitaLimitedberevokedandthe
ConstitutiontabledattheAnnual
Meeting and signed by the
Chairman for the purposes of
identification be adopted with effect
from the close of themeeting.”

37
RESOLUTION 2:
APPOINTMENT AND
REMUNERATION OF AUDITORS
To consider, and if thought fit to pass,
the following ordinary resolution:
“That the meeting record the
re-appointment of KPMG as the
auditors of the Company for the current
financialyearending30 June2020
pursuanttosection207Tofthe
CompaniesAct1993, andauthorisethe
Board to fix KPMG’sremuneration.”

38
RESOLUTION 3:
DIRECTOR RE-ELECTION –MR. PAUL REID
Paul is an innovative thinker who understands digital trends
and application in the commercial area. Currently Paul is
Chair of Figured (an accounting platform for farming
businesses) and Volpara Health Technologies Limited
(ASX:VHT), Director of Christchurch Airport and Pukeko
Pictures GP (Global Entertainment Company) and an advisory
board member to several technology businesses.
He has held a number of key executive roles in the
transformation of businesses including NZ Post Group, Air
New Zealand, MetService and Carter Holt Harvey. Paul holds
honours degrees in Mathematics and Operations Research.
Paul joined the Comvita Board in May 2017.

39
RESOLUTION 4:
DIRECTOR RE-ELECTION -MS. SARAH KENNEDY
Sarah is a Director of Lifestream International, a 100% New Zealand owned
company specialising in bioavailable, ethical, plant-based health foods. Prior to
this she was the CEO of Designer Textiles International. From 2011 to 2014,
Sarah was with Fonterra and held roles as Vice President International Farming
based in China, Managing Director of Dairy Nutrition and Managing Director of
RD1 -Fonterra's chain of rural retail stores. Prior to that, Sarah had 10 years as
Managing Director of Healtheries/Vitaco NZ Limited and during this time she
handled the sales and distribution role for Comvita in NZ. During her time at
Healtheries, she oversaw the merger of Healtheries with Nutralife, doubling the
size of the organisation and increasing market share significantly in both NZ and
Australia,alongwithtakingthebusinessintointernationalmarkets.
Sarahisoriginallyaveterinarianbytrainingand has held a number of other
senior executive positions in agribusiness and food industries. Sarah joined the
Comvita Board in July2015.

40
RESOLUTION 5:
DIRECTOR ELECTION -MR. BOB MAJOR
Bob Major has a Master’s degree in Science from Massey University. He
has spent the majority of his career in various roles within the New
Zealand dairy industry, working for Fonterra, the New Zealand Dairy Board
and the New Zealand Dairy Research Institute. He has held global
leadership roles for Fonterra in a number of areas including strategy,
mergers and acquisitions, ingredients sales and marketing and innovation.
He has held regional leadership roles in the Middle East, Hong Kong and
China, and was on the senior leadership team of both the New Zealand
Dairy Board and Fonterra.
Bob is Chairman of Gibbs Holdings (Nelson) Ltd, and a director of Kiwirail,
BioVittoria and Miro Berries. He Chairs High Value Nutrition, one of the
National Science Challenges, the Avocado Primary Growth Partnership
and is a member of the Oriens Capital Investment Committee. Bob is a
past Chair of The Mud House Wine Group and has been a director of
Westland Milk Products, the Sealord Group and Barker Fruit Processors.
Bob is a Chartered Fellow of the New Zealand Institute of Directors.

41
RESOLUTION 6:
DIRECTOR ELECTION –MR. ZHU GUANGPING
Mr. Zhu Guangping established Shenzhen Comvita Natural Food Co. Ltd in
2004, which introduced the Comvita brand into the China market and set
up the first franchised store of Comvita. Shenzhen Comvita Natural Food
Co. Ltd was Comvita’s exclusive distributor in China for 12 years prior to
selling 51% to Comvita in 2017. Comvita acquired the balance of 49% in
July 2019.
In addition to Comvita business, Mr. Zhu owns and operates businesses in
manufacturing, real estate and retail. He has extensive experience in
business management, strategy, investment and luxury goods industries.
He has held directorship and chairmanship positions in a number of public
and private companies in China and Hong Kong. Mr Zhu holds an EMBA
from CKGSB. Mr Zhu is the husband of Li Wang, Comvita’s largest
shareholder with approximately 17.2% of Comvita. If elected, Li will be Mr
Zhu’s alternate.

42
RESOLUTION 7:
DIRECTOR ELECTION –MR. CHENG DAYONG
Mr. Cheng Dayong is the General Counsel of the Legal &
Secretarial Department at China Resources Enterprise, Limited.
China Resources own approximately 9.2% of Comvita. Mr Cheng
joined China Resources Group in 2003. Prior to that, he had
worked in private practice and has extensive experience in
corporate and commercial legal work as well as regulatory
compliance.
Mr.ChengholdsaBachelorofLawsdegreefromthe
UniversityofInternationalBusinessandEconomics,China.He
isamemberofAllChinaLawyersAssociationandaresidentof
HongKong.

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