ArborGen Holdings issues Interim Review

PERIOD ENDED 30 SEPTEMBER 2019 PRELIMINARY ANNOUNCEMENT
ArborGen Holdings Limited (Consolidated)
Full year ended 30 September 2019
This report has been prepared in a manner which complies with generally accepted accounting practice and gives a true and fair view of the matters to
which the report relates and is based on audited and unaudited financial statements. The previous accounting period was the six months to 30 September
2018. The Group's financial statements have been prepared in accordance with New Zealand International Financial Reporting Standards (NZ IFRS). The
Listed Issuer has a formally constituted Audit Committee comprising members of the ArborGen Holdings Board of Directors. On the 30th of September
2019 Rubicon Limited formally changed it's name to ArborGen Holdings Limited. Any historical references to ArborGen Holdings refer also to Rubicon Limited.
The financial statements are presented in US$ millions, rounded to the nearest hundred thousand.
Reporting Period6 months to 30 September 2019
Previous Reporting Period6 months to 30 September 2018
Amount US$
millions
Percentage
change
Revenue from ordinary activities14.2 46.4%
Profit (loss) from ordinary activities after tax attributable to security holders(3.0)n/a
Net profit (loss) attributable to security holders(3.0)n/a
Amount per securityImputed amount per security
Interim/Final DividendNo dividend is proposed for the periodNot applicable
Record DateNot applicable
Dividend Payment DateNot applicable
1NET ASSET BACKING PER SHAREAs atAs atAs at
30 Sep 201931 Mar 201931 Mar 2019
Cents per shareCents per shareCents per share
Net assets per shareNZ 46 cps NZ 44 cps NZ 45 cps
Net tangible assets per shareNZ 13 cps NZ 12 cps NZ 14 cps
Net assets per shareUS 29 cps US 30 cps US 30 cps
Net tangible assets per shareUS 8 cps US 8 cps US 9 cps
2EARNINGS PER SHARE
6 Months12 Months6 Months
30 Sep 201931 Mar 201930 Sep 2018
US$ earnings per share
Cents per shareCents per shareCents per share
Basic US (0.6) cpsUS (0.9) cpsUS (0.5) cps
Diluted US (0.6) cpsUS (0.9) cpsUS (0.5) cps
NZ$ earnings per share
Basic NZ (1.0) cpsNZ (1.3) cpsNZ (0.8) cps
Diluted NZ (1.0) cpsNZ (1.3) cpsNZ (0.8) cps
3
FINANCIAL STATEMENTS
The consolidated income statement, consolidated statement of comprehensive income, statement of changes in equity, consolidated statement of cash flows
and consolidated balance sheet, and segmental information are included in the Interim Review (issued today with this announcement).
4COMMENTS BY DIRECTORS
See attached ArborGen Holdings 2019 Interim Review (issued today).
5DIVIDENDS - Nil
The ArborGen Holdings interim review is available today on the NZX and at
www.arborgenholdings.com.
This Release was approved by a resolution of Directors on 26 November 2019
26 November 2019
S Ludher-Chandra
Company Secretary
Page 1 of 1

---

Interim Review 2019

2


Dear Shareholder

This Report outlines our performance for the interim six-month period to 30 September 2019. During this period our
focus has been tightly on advancing the key initiatives critical to lifting the earnings and cash flow performance of your
Company over the next immediate period. We are confident that as these initiatives bear fruit, our earnings and cash
flow will lift as a result.

Our commentary for the period is outlined below.

Refined Portfolio
Following the portfolio change which saw the sale of Tenon and the 100% acquisition of the US-based ArborGen business,
ArborGen has become Rubicon’s sole operating activity. Consistent with this refined business structure and also with our
‘One Company’ approach, we announced in September of this year that Rubicon Limited would be renamed ArborGen
Holdings Limited. Our shares continue to trade on the NZX but now under a new ticker – ARB, and of course also by our
new name.

Given our much tighter business focus now, it is appropriate to remind shareholders of ArborGen’s business and strategy.
In summary -
 We are the largest global commercial supplier of tree seedlings, specialising in loblolly (US and Brazil), radiata (NZ),
and eucalyptus (Brazil and Australia) plantation forestry species.
 We are the leading provider of advanced genetics for the forest industry in these regions, operating across the entire
technology spectrum offering high-value products that significantly improve the productivity of a given acre of forestry
land by enabling our customers to grow trees that –
o Yield more wood (particularly saw-timber) per acre,
o Demonstrate greater consistency, uniformity and quality,
o Grow in a shorter period of time, and
o Are more resilient and disease resistant.
 By employing state-of-the-art technology (we spend US$4+m million annually on R&D), we are –
o Developing and expanding ArborGen’s pipeline of industry leading advanced genetics, including building a future
supply of our high-value premium MCP products in the US, and
o Transitioning our customers from OP genetics to advanced MCP and varietal genetics in the US (our single largest
market) which is also where we believe our largest earnings uplift will come from in the future.
 Our MCP seedling production is projected to grow significantly as our large, younger and more advanced seed
orchards approach their maximum seed yielding years - the direct result of investments made in expanding our MCP
orchard capacity 5-10 years ago –
o ArborGen’s MCP seed production is projected to more than triple from the current 90 million up to ~300 million
seedling equivalents by 2025,
o Allowing us to meet the growing demand for these products (we are currently supply constrained),
o ... and build sufficient buffer inventory to counter any adverse weather events.
 Our production assets are located across the US Southern forestry region, NZ, Brazil and Australia comprising:–
o 17 seedling production nurseries (8 in the US, 6 in NZ, 2 in Brazil and 1 in Australia), and
o 9 seed producing orchards (6 in the US and 3 in NZ)
o ... with an overall production capacity of circa 400 million seedlings in the US-South, 25 million in ANZ and 90
million in Brazil (including outsourced production in Brazil and the US).
 We have extensive field trials throughout the US demonstrating the performance of our advanced genetic products,
which have been developed using unique intellectual property from a proprietary genetics database representing the
combined forestry genetic history of our three predecessor companies – Fletcher Challenge, International Paper and
WestRock.
 We service over 1,000 customers each year across a range of market segments, including selling to the large industrial
and diversified private markets.

Chairman’s Letter

3


Achieving Goals
With the core building blocks for ArborGen firmly in place, our focus is now on progressing the critical strategic, operational
and financial goals we have set for the business –
 Expanding our footprint in a capital-light manner in our core growth regions,
 Continuing to invest in developing and expanding our portfolio of proprietary advanced genetics,
 Improving cash flows by streamlining operations and improving asset utilisation, and
 Mitigating the financial impact of adverse climatic events.

Expanding Our Footprint
United States
In our largest and most critical market segment – the US, sales orders are at record levels this year, and we are already
sold out in many product categories. Subject to the normal weather caveats, we expect to report record total seedling
volumes and revenue for the current fiscal year.

These higher sales have been enabled by expansion in our US nursery capacity. You will recall that last year we entered
into an agreement with TexMark Timber Treasury (“TTT”) to lease and operate TTT’s 30 million seedling nursery in Texas
(with the right to acquire the properties in 2023) along with an exclusive multi-year agreement to supply TTT an estimated
15 million seedlings per annum this fiscal year. This followed the execution of a long-term lease for the 30 million unit
Taylor nursery from the state of South Carolina in the prior year. Beyond their respective production capacity additions,
both these nurseries have also facilitated new sales through integration of the customers these nurseries were servicing
into our system, as well as by expanding our market reach in these regions.

Converting customers to our higher value advanced genetics is where the material future earnings growth will come from
in this region. In this respect, due to the extensive education activities we have undertaken over the past five years or so,
our industrial customers are now well aware of the increased value our advanced genetics offer to them in terms of the
economic returns delivered to their forest estates, and we will be working to leverage that understanding into increased
conversion. We are now extending our conversion activities into the large private segment (i.e. non-industrial
landowners), which comprises more than 50% of the total US seedling market. Our private landowner effort is underpinned
by our ABCD strategy – Acquire, Build confidence, Convert, and Defend - which acknowledges that the conversion of
private landowners to advanced genetics is a process not an event, and that the very first step is to acquire new customers
and gain market share in order to achieve our advanced genetics sales’ targets.

Australasia
We are pleased to report that there has been substantial growth in both the New Zealand and Australian markets, as
anticipated. With the selling season over in both of these countries for the current fiscal year, we expect to report record
unit sales, revenue and profits for the fiscal year ending March 2020. The growth in NZ has been driven by a combination
of increased harvesting and reforestation efforts due to the maturing of forestry estates planted in the early 1990s, and
the Government’s ‘One Billion Trees’ programme. In Australia, reforestation has increased as the market recovers from
the collapse of the Management Investment Schemes earlier in the decade.

Brazil
In Brazil, our sales have increased materially over the prior year as reforestation rates have increased in line with the
recovery of the Brazilian economy and as the value of our proprietary products become increasingly clear. Specifically,
reforestation rates are increasing substantially in Brazil as increased production of charcoal (for pig iron and steel) and
pulp are increasing the eucalyptus harvest levels.

4



The strategic steps we have taken to build the Brazil business have positioned us well to take advantage of this growth.
More recently, these have included –
 The execution of an exclusive eucalyptus genetics license and commercialisation agreement with Gerdau Acos
Longos SA (announced in November of last year) which has expanded our eucalyptus product offerings to include
Gerdau’s high wood density and high yield clones ideally suited for the charcoal and energy markets.
 The lease of a 15 million eucalyptus nursery in Minas Gerais from Brotale (announced in October of this year) which
has further expanded our customer base and increased our market reach, especially in the state of Minas Gerais, the
largest charcoal producing state in Brazil.

Our pine programme in Brazil also continues to grow albeit from a lower base, and we project double digit growth in
volume.

Continuing to Expand our Portfolio of Proprietary Genetics
As noted above, demand for our MCP products in the US has been especially strong this year, demonstrating that more
and more landowners are beginning to understand the value that MCP based seedlings offer. This is extremely
encouraging, and supports the strong growth in MCP seedling sales we expect to see in future periods as our MCP seedling
supply (i.e. production) recovers from the impact of Hurricane Michael.

The effect of Hurricane Michael last year, together with freeze damage experienced in the prior year, have unfortunately
constrained our near-term MCP seed supply to a level well below our current demand for these products. However,
beyond this immediate timeframe our MCP seed supply will grow dramatically as our large, younger and more advanced
seed orchards approach their maximum seed yielding years. This growth in supply is a result of strategic decisions made
5+ years ago to expand our productive base of MCP seed, and which will shortly begin to bear fruit.

The chart below graphically shows our forecast growth in MCP seed supply to support the growing demand trends for our
advanced genetics products.



* Years shown are the year of seed harvest, which relates to seedling production in the following fiscal year

In addition to the volumetric growth in MCP seed supply that this chart shows, at the same time as volume grows, we are
also investing heavily in improving the underlying genetics of the MCP seed being produced. We already have three broad
performance categories of MCP products, which customers can use to move up the MCP value chain, and over time the
genetics within each of these ‘good-better-best’ categories will also lift as we introduce yet higher-value versions of these
advanced genetics products.

5



Improving Cash Flow
We constantly strive to increase the cash generation performance of our business. In that regard, we continue to work to
reduce overhead cost and any non-operational cash expenditures. By way of example, in August of this year we acquired
the US property where ArborGen Inc.’s Ridgeville South Carolina headquarters are located. This move has allowed us to
immediately decrease our annual cost for this facility by accessing a financing cost lower than the prior annual lease rate.
In addition, we made the decision to consolidate our presence at the site and generate some further cash flow by leasing
out surplus floor space to a third party hemp company that is establishing a processing plant to take advantage of the
growing industrial hemp market in the US southeast. We project that these actions will improve ArborGen Holdings net
earnings and cash flow by approximately $1 million on an annualised basis moving forward.

Mitigating Adverse Climatic Events
We are acutely aware that we are an agricultural / biological based business, and that climatic events can adversely impact
our performance and that of our customers. Unfortunately, it appears that climate change has increased the frequency of
these events, and we are very conscious that we need to be able to mitigate the worst of them. This is nothing new for us,
however the recent extreme weather events have heightened the importance of the issue once again. In short, we have
in place a four-pronged approach to mitigate these adverse events over the long term, by –
 Spreading the geographic location of our production assets,
 Diversifying our customer base by geography and market segment,
 Growing our seed supply to generate buffer inventory, and
 Modifying our production standard operating procedures to reduce seedling losses.

We will report more on these in subsequent reports to you.

Financial Performance – Current and Outlook
In October of this year we reported as follows in relation to our fiscal 2020 full year performance –

“As a result of market share expansion, as well as continued general market recovery in all of its core markets, this year’s
unit seedling sales and revenue will be materially higher than prior fiscal year. However, consistent with earlier statements,
the severe weather events in the US from last year and earlier this year will unfortunately result in constrained advanced
genetics sales this fiscal year (i.e. circa 5% lower than prior year), as well as lower than normal unit seedling margins as
these higher weather-related costs are expensed. These weather-related stress events have also resulted in extremely
unusual widespread seedling survival issues throughout the US South-eastern region in relation to last year’s seedlings,
including across some of our customer sites. While we don’t believe this mortality issue can be attributed to our seedling
quality, the industry has agreed to share the cost of this loss, and accordingly we will have an abnormal expense of
approximately US$1 million in the current fiscal year. Having said all of that, we continue to believe ArborGen’s US-GAAP
underlying earnings will be circa 20% higher
1
than prior year’s US$6.1 million result (subject to any uncontrollable factors).
And in terms of future performance, we believe we will be reporting double-digit US-GAAP EBITDA next fiscal year, with
earnings increasing materially each year in line with our projected MCP seed supply growth.”

In terms of the financial period covered by this Review (i.e. the six-month period to 30 September), revenue was up 46%,
from $9.7 million in the prior period to $14.2 million. As noted in previous reports, our interim period revenue is not
reflective of ArborGen’s annual forecast revenue as it does not include the crop lifting and selling season in its largest
market (the US), which only occurs in the last quarter of our fiscal year.

6


For the period we reported an IFRS Net Loss of $3.0 million, inclusive of the full accrual for $2.8 million of abnormal items
- i.e. ~ break-even result excluding abnormal items, which included –

 Higher than normal seed costs being expensed in the period due to the severe weather events in the US last year
which will result in lower unit seedling margins,
 Cost of seedlings provided to customers this year for seedling losses (see below), and
 Residual ArborGen acquisition costs.

However, as we move forward to the second half of our fiscal year, our focus is now on delivering the full year’s results
(outlined above in italics). To do so, we will be lifting and delivering a record volume of seedlings to our customers in the
US. In that regard, our sales continue to reflect the strength of our product portfolio as well as our strong customer
relationships. It is in this context that we chose, on this particular occasion, to assist our customers who suffered excessive
seedling mortality losses in the fiscal year 2019 planting season. This decision has significantly improved our already strong
customer relationships, and we believe this will serve us in good stead in the years to come.

In Brazil we are focused on integrating the new, leased nursery into our production platform and continuing to work with
current and new customers to help them understand the value of proprietary eucalyptus and pine products.

With Australia / New Zealand’s current year results largely in hand, we are focusing on the production and sale of our next
year’s crop.

Despite the weather events that have adversely impacted us this year, we still believe we are on track to meet our fiscal
2020 earnings guidance.

As usual, I would like to thank all of our stakeholders for their continued support – it is very much appreciated. I look
forward to reporting to you next at the successful conclusion of our fiscal year.



Dave Knott Jr
Chairman












1. US GAAP underlying earnings is a non-GAAP earnings measure which does not have a prescribed meaning by GAAP, and may not
be comparable to similar financial information presented by other entities. Please refer to Note 12 of the 30 September 2019
Interim Review.
2. Please refer Note 12 of the 30 September 2019 Interim Review.

7




LIMITED AND SUBSIDIARIES
ARBORGEN HOLDINGS LIMITED AND SUBSIDIARIES
Consolidated Income Statement
For the six months ended 30 September 2019


6 M o n th sYear en d ed6 M o n th s
S ep 2 0 1 9M ar 2 0 1 9S ep 2 0 1 8
No tesUS $ mUS $ mUS $ m
Revenue14.2 49.1 9.7
Cost of sales(11.2) (32.0) (8.1)
Gro s s p ro f i t3 .0 1 7 .1 1 .6
Change in fair value of biological assets46.5 0.8 6.7
Administration expense(8.9) (16.8) (8.4)
O p erati n g earn i n gs ( l o s s ) exc l u d i n g i tems b el o w0.6 1.1 (0.1)
Inventory provision and extreme weather event related expenses5(2.6) - -
Restructuring and transaction-related expenses5(0.2) (4.1) (2.0)
Gain on sale- 0.5 0.5
O p erati n g earn i n gs ( l o s s ) b ef o re f i n an c i n g exp en s e( 2 .2 ) ( 2 .5 ) ( 1 .6 )
Financing expense(1.2) (2.2) (1.1)
Earn i n gs ( l o s s ) b ef o re taxati o n( 3 .4 ) ( 4 .7 ) ( 2 .7 )
Tax benefit0.4 0.5 0.5
Net earn i n gs ( l o s s ) af ter taxati o n f ro m c o n ti n u i n g o p erati o n s(3.0) (4.2) (2.2)
Net earnings after taxation from discontinued operations- (0.1) (0.2)
Net Earn i n gs / ( l o s s )( 3 .0 ) ( 4 .3 ) ( 2 .4 )
Basic/diluted earnings (loss) per share information (cents per share)(0.6) (0.9) (0.5)
Continuing operations(0.6) (0.8) (0.5)
Weighted average number of shares outstanding (millions of shares)498.6 496.9 488.0
The accompanying notes form part of, and are to be read in conjunction with, these financial statements.

8



ARBORGEN HOLDINGS LIMITED AND SUBSIDIARIES
Consolidated Statement of Comprehensive Income
For the six months ended 30 September 2019


6 M o n th sYear en d ed6 M o n th s
S ep 2 0 1 9M ar 2 0 1 9S ep 2 0 1 8
US $ mUS $ mUS $ m
Net Earn i n gs( 3 .0 ) ( 4 .3 ) ( 2 .4 )
Items that may be reclassified to the Consolidated Income Statement:
Movement in currency translation reserve9(1.2) (0.8) (1.0)
O th er c o mp reh en s i v e i n c o me ( n et o f tax)( 1 .2 ) ( 0 .8 ) ( 1 .0 )
To tal c o mp reh en s i v e i n c o me / ( exp en s e)( 4 .2 ) ( 5 .1 ) ( 3 .4 )





ARBORGEN HOLDINGS LIMITED AND SUBSIDIARIES
Statement of Changes in Equity
For the six months ended 30 September 2019


6 M o n th sYear en d ed6 M o n th s
S ep 2 0 1 9
M ar 2 0 1 9S ep 2 0 1 8
No tesUS $ mUS $ mUS $ m
To tal c o mp reh en s i v e i n c o me( 4 .2 ) ( 5 .1 ) ( 3 .4 )
Movement in ArborGen Holdings shareholders' equity:
Movement in issued capital81.3 - -
Movement in share based payment reserve(1.2) 1.3 -
To tal mo v emen t i n s h areh o l d er eq u i ty( 4 .1 ) ( 3 .8 ) ( 3 .4 )
Opening Group equity147.6 151.4 151.4
C l o s i n g Gro u p Eq u i ty1 4 3 .5 1 4 7 .6 1 4 8 .0
The accompanying notes form part of, and are to be read in conjunction with, these financial statements.







ARBORGEN HOLDINGS LIMITED AND SUBSIDIARIES

9



ARBORGEN HOLDINGS LIMITED AND SUBSIDIARIES
ARBORGEN HOLDINGS LIMITED AND SUBSIDIARIES
Consolidated Statement of Cash Flows
For the six months ended 30 September 2019


6 M o n th sYear en d ed6 M o n th s
S ep 2 0 1 9
M ar 2 0 1 9S ep 2 0 1 8
No tesUS $ mUS $ mUS $ m
Cash was provided from operating activities
Receipts from customers22.5 51.4 20.6
Cash provided from operating activities22.5 51.4 20.6
Payments to suppliers, employees and other(24.9) (47.3) (23.9)
Cash (used in) operating activities(24.9) (47.3) (23.9)
Net c as h f ro m ( u s ed i n ) o p erati n g ac ti v i ti es( 2 .4 ) 4 .1 ( 3 .3 )
Sale of assets- 0.8 0.8
Investment in fixed assets10(15.4) (2.7) (1.1)
Deferred settlement- (10.0) (10.0)
Investment in intellectual property(1.9) (4.7) (2.3)
Net c as h f ro m ( u s ed i n ) i n v es ti n g ac ti v i ti es( 1 7 .3 ) ( 1 6 .6 ) ( 1 2 .6 )
Debt drawdowns22.5 9.0 5.4
Debt repayment(1.4) (18.9) (7.0)
Interest paid(1.1) (2.1) (1.1)
Net c as h f ro m ( u s ed i n ) f i n an c i n g ac ti v i ti es2 0 .0 ( 1 2 .0 ) ( 2 .7 )
Net cash from discontinued operations- 2.4 2.4
Net mo v emen t i n c as h0 .3 ( 2 2 .1 ) ( 1 6 .2 )
Opening cash, liquid deposits and restricted cash7.2 29.0 29.0
Effect of exchange rate changes on net cash(0.1) 0.3 -
C l o s i n g C as h , Li q u i d D ep o s i ts an d res tri c ted c as h7 .4 7 .2 1 2 .8
Net Earnings(3.0) (4.3) (2.4)
Adjustment for:
Financing expense1.2 2.1 1.1
Depreciation and amortisations4.3 8.7 3.8
Taxation(0.4) (0.5) (0.4)
Foreign exchange(0.3) (0.5) (0.4)
Change in fair value of biological assets(6.5) (0.8) (6.7)
Other non cash items(0.1) 0.5 -
Cash flow from operations before net working capital movement(4.8) 5.2 (5.0)
Trade and other receivables4.2 (1.4) 4.3
Inventory(2.8) (3.7) (5.9)
Trade and other payables1.0 4.0 3.3
Net working capital movement2.4 (1.1) 1.7
Net c as h f ro m o p erati n g ac ti v i ti es( 2 .4 ) 4 .1 ( 3 .3 )
The accompanying notes form part of, and are to be read in conjunction with, these financial statements.

10


ARBORGEN HOLDINGS LIMITED AND SUBSIDIARIES
ARBORGEN HOLDINGS LIMITED AND SUBSIDIARIES
Consolidated Balance Sheet
As at 30 September 2019


S ep 2 0 1 9M ar 2 0 1 9
S ep 2 0 1 8
No tesUS $ mUS $ mUS $ m
C u rren t as s ets
Cash and liquid deposits5.4 3.2 8.8
Trade and other receivables5.0 9.1 3.4
Inventory39.5 29.4 37.2
To tal c u rren t as s ets4 9 .9 4 1 .7 4 9 .4
No n c u rren t as s ets
Restricted cash2.0 4.0 4.0
Fixed assets49.8 42.7 42.3
Intellectual property104.6 105.6 106.1
To tal n o n c u rren t as s ets1 5 6 .4 1 5 2 .3 1 5 2 .4
To tal as s ets2 0 6 .3 1 9 4 .0 2 0 1 .8
C u rren t l i ab i l i ti es
Trade, other payables and provisions(15.7) (14.5) (14.0)
Current lease obligation(1.1) (0.8) (0.8)
Current debt6(15.1) (0.5) (3.1)
To tal c u rren t l i ab i l i ti es( 3 1 .9 ) ( 1 5 .8 ) ( 1 7 .9 )
Term l i ab i l i ti es
Term debt6(23.9) (16.5) (21.5)
Finance lease obligation(4.5) (11.2) (11.4)
Deferred taxation liability(2.5) (2.9) (3.0)
To tal term l i ab i l i ti es( 3 0 .9 ) ( 3 0 .6 ) ( 3 5 .9 )
To tal l i ab i l i ti es( 6 2 .8 ) ( 4 6 .4 ) ( 5 3 .8 )
Net As s ets1 4 3 .5 1 4 7 .6 1 4 8 .0
Eq u i ty
Share capital8202.3 201.0 201.0
Reserves9(58.8) (53.4) (53.0)
To tal Gro u p Eq u i ty1 4 3 .5 1 4 7 .6 1 4 8 .0
Net As s et B ac k i n g US 29 cps US 30 cps US 31 cps
Dave Knott JrPaul Smart
Chairman of the BoardAudit Committee Chairman
26 November 2019
The accompanying notes form part of, and are to be read in conjunction with, these financial statements.

11


ARBORGEN HOLDINGS LIMITED AND SUBSIDIARIES
ARBORGEN HOLDINGS LIMITED AND SUBSIDIARIES
Notes to the Consolidated Financial Statements
For the six months ended 30 September 2019


1 BASIS OF PRESENTATION

The financial statements presented are those of ArborGen Holdings Limited and Subsidiaries (the Group) for the six months
from 1 April 2019 to 30 September 2019. The financial statements have been prepared in accordance with New Zealand
International Accounting Standard 34, and because they are interim statements they do not include all of the information
required to be disclosed for full annual financial statements.

On the 30th of September 2019 Rubicon Limited formally changed its name to ArborGen Holdings Limited and also changed
its NZX listing ticker to be ARB on that date. Any historical references to ArborGen Holdings refer also to Rubicon Limited.

These financial statements should be read in conjunction with the audited financial statements for the periods ended 31
March 2019 and 31 March 2018, which have been prepared in accordance with New Zealand International Financial
Reporting Standards (NZ IFRS) and International Financial Reporting Standards (IFRS).

ArborGen Holdings Limited is registered in New Zealand under the Companies Act 1993, is listed on the New Zealand Stock
Exchange, and is a FMC Reporting Entity under the Financial Markets Conduct Act 2013.

The presentation currency used in the preparation of these financial statements is United States dollars (US$), rounded to
the nearest hundred thousand dollars. Consequently all financial numbers are in US$ unless otherwise stated.

Accounting Policies
With the exception of the adoption of NZ IFRS 16 Leases (as described below), the accounting policies applied are
consistent with those applied in the annual financial statements for the period ended 31 March 2019.

NZ IFRS 16 Leases
The new standard replacing the previous guidance in NZ IAS 17 Leases, and is effective for annual periods beginning on or
after 1 January 2019 and deals with the recognition, measurement, presentation and disclosure of leases. The new
standard introduces a single model for lessees, removing the previous distinction between operating and finance leases,
and recognises all leases on the balance sheet through an asset representing the rights to use the leased asset and a liability
for the obligation to make lease payments. The new standard aims to provide users of the financial statements relevant
information to assess the effect that leases have on the balance sheet, income statement and cash flows of the reporting
entity.

The Group reviewed leases where it is the lessee and these leases primarily relate to leases for properties, nursery/orchard
land, motor vehicles and plant and equipment.

The Group has used the NZ IFRS 16 modified retrospective approach, with the right-of-use (ROU) asset being equal to the
lease liability as at commencement date for all existing leases at 1 April 2019. The Group has made use of the practical
expedients available on transition to NZ IFRS 16 not to reassess whether a contract is or contains a lease. Accordingly, the
definition of a lease in accordance with NZ IAS 17 will continue to be applied to those leases entered or modified before 1
April 2019. Comparative numbers have not been restated.

12


ARBORGEN HOLDINGS LIMITED AND SUBSIDIARIES
ARBORGEN HOLDINGS LIMITED AND SUBSIDIARIES
Notes to the Consolidated Financial Statements
For the six months ended 30 September 2019



The ROU assets are subsequently depreciated using the straight line method over the shorter of the estimated useful lives
of the ROU assets or the remaining estimated lease term. The estimated useful lives of ROU assets are determined on the
same basis as similar owned assets within property, plant and equipment. An additional depreciation expense of $0.4
million has been recognised in relation to the adoption of NZ IFRS 16. The lease liabilities are initially measured at the
present value of the unpaid lease payments at commencement date, discounted using a discount rate. Under NZ IFRS 16,
ROU assets are tested for impairment in accordance with NZ IAS 36 Impairment of Assets, replacing the previous
requirements to recognise a provision for onerous lease contracts.

Key judgment areas in applying the new standards are the discount rate and assessment of whether options to extend or
terminate a lease will be exercised. The discount rates used are the Group’s incremental borrowing rates (IBR), which
reflects the borrowing rates that could be obtained from financial institutions as if the Group had purchased the leased
asset, with the term of the borrowing similar to the lease term. The weighted average rate applied was 5.3%.

As noted, the Group has applied the practical expedients when applying NZ IFRS 16 to leases previously classified as
operating leases under NZ IAS 17, using a single discount rate for a portfolio of similar leases and not recognising short-
term (less than 12 months) or low-value assets as ROU assets and liabilities. For short-term and low-value assets leases,
the Group has opted to recognise a lease expense on a straight-line basis as is permitted by NZ IFRS 16. This expense is
presented within cost of sales or administration expense in the income statement.



R ec o n c i l i ati o n o f l eas e c o mmi tmen t to o p en i n g l eas e l i ab i l i ty as at 1 Ap ri l 2 0 1 9 :
Operating lease commitments as at 31 March 2019(4.5)
Effect of discounting using incremental borrowing rates at 1 April 20190.9
Recognition exemption for:
- short-term leases0.3
- leases of low-value assets0.1
Extension and termination options reasonably certain to be exercised(2.2)
Lease liabilities recognised at 1 April 2019(5.4)




Under NZ IAS 17, all lease payments on operating leases were presented as part of cash flows from operating activities.
Consequently, for the 6 months to 30 September 2019, the net cash generated by operating activities has increased by
$0.6 million and net cash used in financing activities increased by the same amount. Comparative numbers have not been
restated. The adoption of NZ IFRS 16 did not have an impact on net cash flows.



2 APPROVAL OF ACCOUNTS

These financial statements have been prepared on a consolidated Group basis and were approved for issue by the Board
of Directors on 26 November 2019.

3 USE OF ESTIMATES AND JUDGEMENT

The preparation of financial statements in conformity with NZ IFRS requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities, and disclosure of contingent assets and liabilities at
the date of the financial statements and the reported amounts of revenues and expenses during the reporting period
(refer March 2019 statutory report, note 4, for greater detail). Actual results could differ from those estimates.

13


ARBORGEN HOLDINGS LIMITED AND SUBSIDIARIES
ARBORGEN HOLDINGS LIMITED AND SUBSIDIARIES
Notes to the Consolidated Financial Statements
For the six months ended 30 September 2019


4 FAIR VALUE ADJUSTMENT ON BIOLOGICAL ASSET


6 MonthsYear ended6 Months
Sep 2019Mar 2019Sep 18
Openi ng bal ance1.5 0.7 0.7
Change i n fai r val ue of bi ol ogi cal assets recogni sed i n i ncome statement
Fai r val ue change for crop to be l i fted i n the comi ng peri od8.0 1.5 7.4
Reversal of pri or peri od fai r val ue change(1.5) (0.7) (0.7)
Change in fair value of biological assets recognised in income statement6.5 0.8 6.7
Closing fair value uplift biological asset8.0 1.5 7.4




At 30 September only the US crop (which will be lifted prior to year-end, being 31 March the following year) are established
and fair valued. This fair value will reverse at year end in March upon sale of the crop. At 31 March 2019, only the
Australasian crops was established and fair valued. The Australasian crops are primarily lifted from late May through to
September each year.



5 INVENTORY PROVISION, EXTREME WEATHER EVENT, RESTRUCTURING AND TRANSACTION RELATED ESPENSES

In the current period a provision has been recognised to expense an abnormally high seed cost of $1.6 million. This higher
than normal seed cost was due to weather events affecting last years' US seed harvest. The weather events had the effect
of lowering seed production volume and resulted in an abnormally high average cost per seed produced. This provision
returns the seed cost to a normal production cost, or standard cost, per seed.

The extremely unusual and widespread seedling survival issues occurring throughout the US South-eastern region, affected
the survival of some of last year’s seedlings, including across some of our customer sites. While we don’t believe this
mortality issue can be attributed to our seedling quality, the industry has agreed to share the cost of this loss, and
accordingly we will have recorded $1 million as an expense in the current fiscal year to assist customers to replace lost
inventory.

The transaction related cost of $0.2 million in the current period, is the final expense under the ArborGen retention plan
put in place when ArborGen was acquired in June 2017. The final $1.0 million cash payment (under the retention) plan
was paid in July 2019. Prior periods include costs relating to the retention plan together with severance expenses under
the One-Company programme (March 2019: $1.0 million for retention plan and $3.1 million severance, September 2018:
$0.5 million for retention plan and $1.5 million of severance).

6 CURRENT DEBT AND TERM DEBT

At 30 September 2019 the Group had debt facilities with the following banks: Synovus Financial Corporation (Synovus) and
AgSouth Farm Credit (AgSouth) in the United States and Westpac New Zealand Limited (Westpac) in New Zealand. In
addition the Group has subordinated promissory notes (Notes) (issued to Directors, shareholders and senior management
in August 2019) to facilitate the US Ridgeville headquarters property purchase.

ArborGen has a non-revolving promissory note issued to AgSouth for $10.5 million bearing interest at 4.95%, with a
maturity date of 1 May 2036, which is secured against ArborGen's US real estate properties. Annual principal repayments
of $0.6 million are due 1 May each year.

14


ARBORGEN HOLDINGS LIMITED AND SUBSIDIARIES
ARBORGEN HOLDINGS LIMITED AND SUBSIDIARIES
Notes to the Consolidated Financial Statements
For the six months ended 30 September 2019



ArborGen's revolving facility agreement with Synovus is a $17 million letter of credit (LOC) facility, which is classified as
current debt as at 30 September 2019, was favourably amended in October 2019. The amendment extended the expiry
from 31 August 2020 to 31 August 2021 and increased the annual 60-day (continuous) pay down maximum borrowing
limit (between 1 March and 31 August) to $7.5 million (previously $6 million). In addition, Synovus requires ArborGen to
maintain a certificate of deposit (restricted cash) of $2 million (2019; $4 million). The remaining $2 million of restricted
cash will be released in August 2020, if ArborGen achieves EBITDA of $8 million for the March 2020 fiscal year (which is
unlikely to be met this year). The LOC bears interest at the 30 day LIBOR base rate plus 2.75%, subject to a minimum
annual rate of 4.75%, and is collateralised by all the of ArborGen Inc.'s United States assets not otherwise pledged under
the AgSouth agreement.

The credit agreements with both Synovus and AgSouth include covenants which require ArborGen to maintain a minimum
net worth of $27 million and $24 million respectively.

ArborGen New Zealand Unlimited (ArborGen NZ) has a NZ$1.5 million line of credit facility, which is subject to renewal on
an annual basis and was increased to $2 million in November 2019.

As part of the acquisition of the US Ridgeville headquarters premises the Group has two new financing facilities. The first
is represented by the Notes issued by ArborGen Inc to related parties (being Directors, shareholders and senior
management) for $2.88 million. The Notes are fully subordinated to all bank debt, repayable at maturity (August 2022),
and due to their subordinated nature attract a 7% per annum interest rate, payable six monthly in arrears. Independent
advice at the time of issuance has confirmed that the interest rate and terms were reasonable to the Company (refer to
note 11).

The second new facility, drawn through Rubicon Industries USA LLC (RIUSA), is a $11.5 million mortgage from Synovus,
which is secured by headquarters land and buildings. The mortgage is a seven-year term facility, based on a 20-year
amortising loan, incurring interest at the 30-day LIBOR base rate plus 2% (currently 4.04%). The Group has entered into a
seven-year interest rate swap, with terms that match that of the mortgage, at a fixed rate of 3.52%. The mortgage requires
RIUSA to maintain a debt service coverage ratio of not less than 1.25:1 for the trailing 12 months.

At 30 September 2019 the Group held cash and liquid deposits of $7.4 million (including restricted cash of $2 million on
deposit with Synovus) (2018: $12.8 million, including restricted cash of $4 million) and had debt of $38.9 million and lease
liability of $5.6 million (being predominantly leases formerly classified as operating) (2018: $24.6 million of debt plus $12.2
million of lease obligations).

15


ARBORGEN HOLDINGS LIMITED AND SUBSIDIARIES
ARBORGEN HOLDINGS LIMITED AND SUBSIDIARIES
Notes to the Consolidated Financial Statements
For the six months ended 30 September 2019


7 SEGMENTAL INFORMATION SUMMARY

The Group has only one reportable segment, being 'forestry genetics'. Each of the primary statements reflects the full
segmental operations, with discontinued operations disclosed separately in both the income statement and statement of
cash flow.


6 MonthsYear ended6 Months
Sep 2019Mar 2019Sep 18
Forestry geneticsUS$mUS$mUS$m
Operati ng revenue14.2 49.1 9.7
Net earni ngs (l os s ) after taxati on from conti nui ng operati ons(2.2) (0.2) (0.5)
Total as s ets206.1 192.1 195.7
Li abi l i ti es(62.4) (45.9) (52.7)
Reconci l i ati on
Discontinued operations
Net earni ngs after taxati on- (0.1) (0.2)
Total as s ets - di s conti nued0.1 0.1 -
Corporate
Net earni ngs after taxati on(0.8) (4.0) (1.7)
Total as s ets0.1 1.8 6.1
Li abi l i ti es(0.4) (0.5) (1.1)
Total Group
Operati ng revenue from conti nui ng operati ons14.2 49.1 9.7
Net earni ngs (l os s ) after taxati on from conti nui ng operati ons(3.0) (4.2) (2.2)
Net earni ngs after taxati on from di s conti nued operati ons- (0.1) (0.2)
Total as s ets206.3 194.0 201.8
Li abi l i ti es(62.8) (46.4) (53.8)

16



ARBORGEN HOLDINGS LIMITED AND SUBSIDIARIES
ARBORGEN HOLDINGS LIMITED AND SUBSIDIARIES
Notes to the Consolidated Financial Statements
For the six months ended 30 September 2019


8 CAPITAL


Sep 2019Mar 2019Sep 2018
Share capitalRefer to noteUS$mUS$mUS$m
Share capi tal at the begi nni ng of the peri od201.0 201.0 201.0
Is s ue of s hares
(1)
91.2 - -
Ves ti ng of s hares - non executi ve di rectors s hare pl an
(2)
90.1 - -
Share capital2 0 2 .3 2 0 1 .0 2 0 1 .0
Number of sharesSep 2019Mar 2019Sep 2018
Openi ng s hares on i s s ue489,574,393 487,908,343 487,908,343
Is s ue of s hares
(1)
99,000,000 - -
Is s ue of s hares
(2) (3)
9820,998 1,666,050 1,666,050
Closing shares on issue499,395,391 489,574,393 489,574,393
Treasury stockSep 2019Mar 2019Sep 2018
Openi ng s hares on i s s ue1,666,050 - -
Is s ue of s hares
(2) (3)
9820,998 1,666,050 1,666,050
Ves ti ng of s hares
(2)
(555,348) - -
Closing treasury stock shares on issue1,931,700 1,666,050 1,666,050



(1) Pursuant to the settlement agreed with the former CEO and CFO on 29 March 2019, ArborGen Holdings allotted and issued nine
million new ordinary shares in two tranches, four million on 1 April 2019 and five million on 30 May 2019.
(2) In accordance with the shareholders resolution passed at the ArborGen Holdings Annual Shareholders’ meeting held on 17
September 2018, on 18 September 2018 ArborGen Holdings issued 1,666,050 new shares to the Rubicon Non-Executive
Directors Share Plan (the Trust). The Trust holds the shares on behalf of the three Directors (Tom Avery, Ozey Horton, and Paul
Smart, equally) until the vesting terms are met. The shares vest, to each Director, in three equal tranches on the first, second
and third anniversaries following the date of issue (18 September 2018), provided that the Director remains a Director of the
Company on the relevant anniversary date. The new shares were issued at the NZX 20-day market VWAP for ArborGen Holdings
shares of NZ27.01 cents per share, for a total value of NZ$450,000. These shares are accounted for as treasury stock until vesting,
and the share based transactions are recorded in the share based payment reserve. On 18 September 2019 the first tranche of
555,348 shares vested to the three Directors (185,116 each) (refer to notes 9 for share based payment information).
(3) In accordance with the shareholders resolution passed at ArborGen Holdings Annual Shareholders’ meeting held on 17
September 2019, on 18 September 2019 ArborGen Holdings issued 820,998 new shares to the 2019 Rubicon Non-Executive
Director Share Plan (the 2019 Trust). The 2019 Trust will hold the shares on behalf of the newly appointed Director (George
Adams) until the vesting terms are met. The shares will vest in three equal tranches on the first, second and third anniversaries
following the date of issue (18 September 2019), provided that the Director remains a Director of the Company on the relevant
anniversary date. The new shares were issued at the NZX 20-day market VWAP for ArborGen Holding shares of NZ18.27 cents
per share, for a total value of NZ$150,000. The share based transactions are recorded in the share based payment reserve.
These shares are accounted for as treasury stock until vesting (refer to note 9 for share based payment information).

17



ARBORGEN HOLDINGS LIMITED AND SUBSIDIARIES
ARBORGEN HOLDINGS LIMITED AND SUBSIDIARIES
Notes to the Consolidated Financial Statements
For the six months ended 30 September 2019


9 RESERVES


Sep 2019Mar 2019Sep 2018
Retained earningsRefer to noteUS$mUS$mUS$m
Openi ng bal ance(53.8) (49.5) (49.5)
Net earni ngs(3.0) (4.3) (2.4)
Closing balance(56.8) (53.8) (51.9)
Share based payments reserve
Openi ng bal ance1.3 - -
Non-executi ve Di rectors s hare pl an8 (2) & 8 (3)0.1 0.1 -
Non-executi ve Di rectors s hare pl an s hares ves ted8 (2)(0.1)
Executi ve s ettl ement s hare pl an s hares ves ted8 (1)(1.2) 1.2 -
Closing balance0.1 1.3 -
Currency translation reserve
Openi ng bal ance(0.9) (0.1) (0.1)
Trans l ati on of i ndependent forei gn operati ons(1.2) (0.8) (1.0)
Closing balance(2.1) (0.9) (1.1)
Total reserves(58.8) (53.4) (53.0)




10 HEADQUARTERS' PREMISES ACQUISITION

In August 2019 the Group acquired the ArborGen US headquarters' premises in Ridgeville South Carolina, for $14.4 million. Prior to
acquisition these premises were recognised on the Group balance sheet as a finance lease asset of $10.3 million and as a lease
obligation totalling $11.1 million. The acquisition of the premises means that neither the lease asset nor lease obligation are
recognised on the Group balance sheet, this de-recognition is non-cash and not shown in the Group cash flow.

11 RELATED PARTY TRANSACTIONS

As part of the acquisition of the US Ridgeville headquarters' premises the Group issued subordinated promissory notes (Notes) to
related parties (being Directors, shareholders and senior management) for $2.88 million. The Notes are fully subordinated to all bank
debt, repayable at maturity (August 2022), and due to their subordinated nature attracts a 7% per annum interest rate, payable six
monthly in arrears.

12 EARNINGS - NON-GAAP MEASURE

ArborGen Holdings shareholders and users of the financial statements are very interested in ArborGen Inc.'s underlying earnings
performance under US-GAAP (as well as under IFRS ), as that is the result that ArborGen Inc. would report in a US ‘listing’ situation.
ArborGen Holdings believes 'US-GAAP underlying earnings' provides useful information, as it is used internally to evaluate
performance, and it is also a measure that equity analysts focus on for comparative company performance purposes, as the measure
removes distortions caused by different depreciation policies and debt:equity structures.

18


ARBORGEN HOLDINGS LIMITED AND SUBSIDIARIES
ARBORGEN HOLDINGS LIMITED AND SUBSIDIARIES
Notes to the Consolidated Financial Statements
For the six months ended 30 September 2019



In contrast with US-GAAP, IFRS requires the capitalisation of ArborGen’s development spend, the amortisation of intellectual
property, the accrual of the change in fair value of biological assets on the seedling crop each year prior to its sale, and the
capitalisation of operating leases. Because of these differences, US-GAAP results, and in particular 'US-GAAP underlying earnings'
cannot be easily derived from reported IFRS numbers. For these reasons and in order to provide users with relevant and
understandable information we provide the reconciliation below.

EBITDA, US-GAAP EBITDA and US-GAAP underlying earnings are all non-GAAP financial measure and are not recognised under NZ
IFRS. As they are not necessarily uniformly defined or utilised and these measures may not be comparable with similarly titled
measures used by other companies. Non-GAAP financial measures should not be viewed in isolation or considered as a substitute for
measures reported in accordance with GAAP. The following table provides users useful ArborGen Inc. information for year-on-year
comparison and reconciles net earnings to 'US-GAAP underlying earnings'.


6 MonthsYear ended6 Months
Sep 2019Mar 2019Sep 2018
ArborGen Inc.Refer to noteUS$mUS$mUS$m
Revenue714.2 49.1 9.7
Cos t of s al es(11.2) (32.0) (8.1)
Gross profit3.0 17.1 1.6
Net earni ngs (l os s ) after taxati on from conti nui ng operati ons7(2.2) (0.2) (0.5)
l es s Tax benefi t(0.4) (0.5) (0.5)
pl us Fi nanci ng expens e1.2 2.2 1.1
Operati on earni ngs (l os s ) before fi nanci ng expens e(1.4) 1.5 0.1
pl us Depreci ati on and amorti s ati ons4.3 8.7 3.8
EBITDA (NZ IFRS)2.9 10.2 3.9
Add back NZ IFRS adjus tments
Inves tment i n i ntel l ectual property(1.9) (4.7) (2.3)
Change i n fai r val ue of bi ol ogi cal as s ets(6.5) (0.8) (6.7)
Other IFRS adjus tments (i ncl udi ng IFRS 16 adjus tment)(0.3) 0.3 0.3
US-GAAP EBITDA (loss)(5.8) 5.0 (4.8)
Add back s i gni fi cant non-recurri ng i tems
Inventory provi s i on and extreme weather event rel ated expens es52.6 - -
Trans acti on-rel ated cos ts0.2 1.0 0.5
Res tructuri ng cos ts- 0.6 0.6
Les s Gai n on s al e- (0.5) (0.5)
US-GAAP underlying earnings (loss)(3.0) 6.1 (4.2)

19


ARBORGEN HOLDINGS LIMITED AND SUBSIDIARIES
Investor Information




INVESTOR ENQUIRIES/REGISTERED OFFICE
Suite 7, 100 Parnell Road, Auckland
PO Box 68 249, Wellesley St,
Auckland 1141, New Zealand

Telephone: 64 9 356 9800
Email: info@arborgenholdings.com
Website: www.arborgenholdings.com
STOCK EXCHANGE LISTING
The Company’s shares (ARB) are listed on the NZSX.
SHAREHOLDER ENQUIRIES
Shareholders with enquiries about share transactions or
changes of address should contact the Share Registrar:

Computershare Investor Services Limited
Level 2, 159 Hurstmere Road
Takapuna, Auckland
Private Bag 92 119,
Auckland 1142, New Zealand

Telephone: 64 9 488 8777
Facsimile: 64 9 488 8787
Email: enquiry@computershare.co.nz

ELECTRONIC COMMUNICATIONS
You can elect to receive your shareholder communications electronically.

To register, visit www.investorcentre.com/nz. To initially access this website, you will need your CSN or Holder Number
and FIN. You will be guided through a series of steps to register your account, including setting up a new user ID and
password for on-going use of the website. Once logged in, click on “My Profile”. In the Communication preferences
panel, click “update”.

Alternatively send your name, address and CSN or holder number to ecomms@computershare.co.nz advising you wish
to receive your ArborGen Holdings shareholder communications by email.



There are statements in this Report that are ‘forward looking
statements.’ As these forward-looking statements are predictive in
nature, they are subject to a number of risks and uncertainties
relating to the Group, many of which are beyond our control.
In particular, ArborGen’s operations and results are significantly
influenced by the general level of economic activity in the various
sectors of the economies in which it competes, particularly in the
United States, Brazil, New Zealand and Australia.
Fluctuations in industrial output and the impact that has on global
demand for wood fibre and hence harvest and reforestation levels,
government environmental and regional development policies,
capital availability, relative exchange rates, interest rates, the
profitability of our customers, can each have a substantial impact
on our operations and financial condition.
ArborGen-specific risks and uncertainties include (in addition to
those broad economic factors noted above) the global markets
and geographies in which it operates, intellectual property
protection, regulatory approvals, public and customer acceptance
of genetically engineered products, the rate of customer adoption
of advanced seedling products, the success of its research and
development activities, weather conditions, cone and seed
inventory, biological matters, and the fact that ArborGen’s annual
crops and seed orchards are not the subject of insurance cover.
As a result of the foregoing; actual results, conditions and
conclusions may differ materially from those expressed or implied
by such statements.