Lion Nathan Limited - Welcome! | Lion · Lion Nathan Limited ... mix improvement resulting in net sales revenue growth ... InternationalPremium Heineken,Beck™s, Amstel, Kirin

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Lion Nathan Limited

Disclaimer:Disclaimer:Disclaimer:Disclaimer:This document has been prepared for the general information of investors. The information contained herein contains forward looking statements which may be subject to events or uncertainties outside of Lion Nathan’s control. No warranty of accuracy or reliability is made and Lion Nathan takes no responsibility for accuracy or reliability of forecasts , the assumptions on which they are based or other forward looking statements. No investment decision should be taken on the basis of the information contained herein.

For additional information, contact:

Caroline Veitch, Investor Relations Director

phone: + 61 2 9290-6615e-mail: [email protected]

or visit our website at: www.lion-nathan.com

Unless indicated otherwise, all $ are Australian

BUSINESS OVERVIEWBUSINESS OVERVIEWBUSINESS OVERVIEWBUSINESS OVERVIEW I MARKET DATA I STRATEGY & GROWTH DRIVERS I FY08 RESULTS I APPENDIXI MARKET DATA I STRATEGY & GROWTH DRIVERS I FY08 RESULTS I APPENDIXI MARKET DATA I STRATEGY & GROWTH DRIVERS I FY08 RESULTS I APPENDIXI MARKET DATA I STRATEGY & GROWTH DRIVERS I FY08 RESULTS I APPENDIX

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Why Lion Nathan is an attractive investment


� Robust earnings and strong cashflow

� Focused and disciplined strategy

� Positioned for growth

� Disciplined capital management and acquisition criteria

� Doing the right thing for the long term

� Great people, great brands

4444

Lion Nathan Limited

� BUSINESS OVERVIEWBUSINESS OVERVIEWBUSINESS OVERVIEWBUSINESS OVERVIEW

�� MARKET DATA MARKET DATA MARKET DATA MARKET DATA

� STRATEGY AND GROWTH DRIVERSSTRATEGY AND GROWTH DRIVERSSTRATEGY AND GROWTH DRIVERSSTRATEGY AND GROWTH DRIVERS

�� FY08 RESULTS & FINANCIALSFY08 RESULTS & FINANCIALSFY08 RESULTS & FINANCIALSFY08 RESULTS & FINANCIALS---- GroupGroupGroupGroup---- AustraliaAustraliaAustraliaAustralia---- New ZealandNew ZealandNew ZealandNew Zealand---- WineWineWineWine

�� APPENDIX APPENDIX APPENDIX APPENDIX

BUSINESS OVERVIEW BUSINESS OVERVIEW BUSINESS OVERVIEW BUSINESS OVERVIEW I MARKET DATA I STRATEGY & GROWTH DRIVERS I FY08 RESULTS I APPENDIXI MARKET DATA I STRATEGY & GROWTH DRIVERS I FY08 RESULTS I APPENDIXI MARKET DATA I STRATEGY & GROWTH DRIVERS I FY08 RESULTS I APPENDIXI MARKET DATA I STRATEGY & GROWTH DRIVERS I FY08 RESULTS I APPENDIX

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Who we are


Net Sales Revenue (A$m) 1,432 487 175 2,094

Share of total assets (%) 2 75% 14% 11% 100%

Share of total EBIT (excl Corp) 83% 14% 3% 100%

EBIT margin 3 31% 16% 1 9% 26%

Beer Market Share (est Sept 2008) 44% 52% n/a n/a

FY08 AUS NZ WINE TOTAL

- Alcoholic beverages: beer, wine, spirits and RTDs in Australia and NZ

- 8 key breweries, 2 craft breweries, 8 wineries, 44 retail outlets (Liquor King, NZ)

- 3,300 strong team in Australia, New Zealand, USA, UK

1 Owned brand beer margin ~ 25%2 AIFRS assets at September 2008 excluding corporate and unallocated assets3 EBIT before one-time, significant items and SGARA

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Our breweries…


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Our breweries…


8888

Our wineries…


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Our brands…Australia


Lion Nathan’s brand portfolio includes…

• 3 of the top 5 beer brands in Australia (XXXX Gold, Tooheys New, Tooheys Extra Dry)

• The #1 mid strength beer in Australia (XXXX Gold)

• The #1 low alcohol beer in Australia (Hahn Premium Light)

• The #1 brand in 5 states / territories

10101010

Our brands…New Zealand



• 3 of the top 5 beer trademarks in New Zealand (Speight’s, Steinlager, Lion Red)

• The #1 beer trademark in New Zealand (Speight’s)

• The #1 premium beer trademark in New Zealand (Steinlager)

• A collection of 54 spirits brands (10 with RTD extensions), 40 wine brands (comprising both owned and agency brands)

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Our brands…Wine



• Internationally renowned wines, including a Decanter World Wine Awards Trophy – Red Rhone Varietal under �10 (St Hallett)

• The Wine Society’s 2008 Young Winemaker of the Year & winning wine (Mitchelton – Ben Haines & Mitchelton Print Shiraz)

• A collection of 61 agency wine brands which Lion Nathan distributes in Australia including premium wine brands Bollinger, Henschke, Brokenwood, Giant Steps, Sandalford and Villa Maria

12121212

2008 financial results - headlines


Volume (beer, wine, spirits & RTDs)Volume (beer, wine, spirits & RTDs)Volume (beer, wine, spirits & RTDs)Volume (beer, wine, spirits & RTDs)

Net Sales RevenueNet Sales RevenueNet Sales RevenueNet Sales Revenue

Operating NPATOperating NPATOperating NPATOperating NPAT

Reported NPATReported NPATReported NPATReported NPAT

Cash realisation ratio*Cash realisation ratio*Cash realisation ratio*Cash realisation ratio*

Total Dividend per shareTotal Dividend per shareTotal Dividend per shareTotal Dividend per share

Earnings per share*Earnings per share*Earnings per share*Earnings per share*

* Before significant items

933 mL933 mL933 mL933 mL +3.9%+3.9%+3.9%+3.9%

$2,094 m$2,094 m$2,094 m$2,094 m +6.5%+6.5%+6.5%+6.5%

$278.3 m$278.3 m$278.3 m$278.3 m +4.2%+4.2%+4.2%+4.2%

$272.7 m$272.7 m$272.7 m$272.7 m

97.4%97.4%97.4%97.4%

42c42c42c42c

51.251.251.251.2

----3.3%3.3%3.3%3.3%

+4.4 pp+4.4 pp+4.4 pp+4.4 pp

+5.0%+5.0%+5.0%+5.0%

+2.0%+2.0%+2.0%+2.0%

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13131313

Group NPAT / EPS (pre-significant items)


180.1

202.7

241.5259

267.2

315

278.3

38.738.738.738.7

41.741.741.741.7

45.345.345.345.3

48.648.648.648.6

51.251.251.251.250.250.250.250.2

2003200320032003 2004200420042004 2005200520052005 2006200620062006 2007200720072007 2008200820082008 2009200920092009

Operating NPAT ($M) EPS (cents)

300

EPS CAGR03-08

6%

NPAT CAGR03-0810%

GuidanceNPAT

10%-16%Increase on

FY08

AGAAPAGAAPAGAAPAGAAP AIFRSAIFRSAIFRSAIFRS

14141414

Total shareholder return


* Global Peer Group is Anheuser Busch, APB, Foster’s, Heineken, InBev, Molson Coors, SAB Miller, San Miguel

TOTAL SHAREHOLDER RETURN (%) TOTAL SHAREHOLDER RETURN (%) TOTAL SHAREHOLDER RETURN (%) TOTAL SHAREHOLDER RETURN (%) (as at 31 Dec 2008)(as at 31 Dec 2008)(as at 31 Dec 2008)(as at 31 Dec 2008)

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1 Year 3 YearCAGR

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5 YearCAGR

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LNN ASX 100 Global Peer Group * (excluding LNN)

15151515

Return on capital employed

Investing for the future through brewery upgrades & Boag’sInvesting for the future through brewery upgrades & Boag’sInvesting for the future through brewery upgrades & Boag’sInvesting for the future through brewery upgrades & Boag’s

* Earnings before interest pre significant items, includes one-time items

ROCE %ROCE %ROCE %ROCE %

(EBI* / Funds Employed + (EBI* / Funds Employed + (EBI* / Funds Employed + (EBI* / Funds Employed + Brands at Cost)Brands at Cost)Brands at Cost)Brands at Cost)


AGAAPAGAAPAGAAPAGAAP AIFRSAIFRSAIFRSAIFRS

9.510.0

12.212.7

13.1

11.7

13.1

2003 2004 2005 2006 2007 2008 2008 ex Boags

16161616

Lion Nathan and the financial crisis

� Demand for beer remains strong, particularly in Australia

� Consumer trends towards Premium, Mid-Strength and Low-Carb continue into Q1

� Funding position is secure

� Proactive approach to refinancing in 2008 and achieved good outcomes as a consequence

� No refinancing requirements until February 2010

� Cash flow is healthy

� Limited exposure to foreign currency movements

� Share price outperformed ASX 200 in FY08


17171717

FY09 Quarter 1 - headlines

Lion Nathan Australia

Lion Nathan New Zealand

Lion Nathan Wine

performing strongly, growing volume and net sales revenue

beer volumes in line with prior year with mix improvement resulting in net sales revenue growth

demand in key markets has softened heat and fires in Vic and SA impacting upon vintage

On track to deliver $On track to deliver $On track to deliver $On track to deliver $300m 300m 300m 300m ---- $$$$315m 315m 315m 315m NPAT, a 10NPAT, a 10NPAT, a 10NPAT, a 10----16% increase on FY0816% increase on FY0816% increase on FY0816% increase on FY08

Total Lion Nathan


* Guidance excludes impact of one-time or significant items in FY09

18181818

Lion Nathan Limited






BUSINESS OVERVIEW I BUSINESS OVERVIEW I BUSINESS OVERVIEW I BUSINESS OVERVIEW I MARKET DATA MARKET DATA MARKET DATA MARKET DATA I STRATEGY & GROWTH DRIVERS I FY08 RESULTS I APPENDIXI STRATEGY & GROWTH DRIVERS I FY08 RESULTS I APPENDIXI STRATEGY & GROWTH DRIVERS I FY08 RESULTS I APPENDIXI STRATEGY & GROWTH DRIVERS I FY08 RESULTS I APPENDIX

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19191919

The beer market is resilient, volumes are stable

Australian Beer Market (Volume) vs Australian Beer Market (Volume) vs Australian Beer Market (Volume) vs Australian Beer Market (Volume) vs Consumer Sentiment IndexConsumer Sentiment IndexConsumer Sentiment IndexConsumer Sentiment Index


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Note: data source for market size changes from Jan 93 (World Drinks Trend/ LN alpha beta)

Volumes are stable, but value in growth

20202020


The beer market is resilient, volumes are stable

New Zealand Beer Market New Zealand Beer Market New Zealand Beer Market New Zealand Beer Market

(Volume)(Volume)(Volume)(Volume)

0

50

100

150

200

250

300

350

1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008

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Volumes are stable, but value in growth

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Mainstream Step-up Low Carb Mid-strength

Low Alcohol Premium Domestic Premium

International Premium

Craft

Australian market profile and trends

Australian beer marketAustralian beer marketAustralian beer marketAustralian beer market(Volumes)*(Volumes)*(Volumes)*(Volumes)*


* Company estimates based on AC Nielsen data MAT to Dec 2008

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Our Australian beer portfolio by category


CategoryCategoryCategoryCategory Lion Nathan Key brandsLion Nathan Key brandsLion Nathan Key brandsLion Nathan Key brands

Craft James Squire

International Premium Heineken, Beck’s, Amstel, Kirin

Domestic Premium Boag’s Premium, Hahn Premium

Step-up Tooheys Extra Dry, Barefoot Radler

Low Carb Hahn Super Dry, Boag’s Classic Blonde, Tooheys New White Stag

Mainstream 4.6% - 5.0% Tooheys New, West End, Boag’s Draught, XXXX Bitter, Emu Bitter

Mid-strength 3.0% - 3.5% XXXX Gold

Low-alcohol <3.0% Hahn Premium Light, Boag’s Premium Light

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23232323

Australian market profile - customers

Pack and Tap mixPack and Tap mixPack and Tap mixPack and Tap mix Customer Customer Customer Customer mixmixmixmix


Pack

Tap

Club

Hotel / Bar

Integrated hotel

Retailer

Wholesaler

Tap beer is in decline, due partly to the move to Premiumisation as premium beers are generally served in glass bottles on-premise

Key customers = Woolworths and Coles who make up the bulk of the Retailer segment

24242424

New Zealand market profile

New Zealand beer marketNew Zealand beer marketNew Zealand beer marketNew Zealand beer market(Volumes)*(Volumes)*(Volumes)*(Volumes)*



Mainstream

Value

Low Carb

LowAlcohol

Premium

International Speciality


Domestic Premium

Craft

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25252525

% NSR% NSR% NSR% NSR

Our New Zealand beer portfolio by category

CategoryCategoryCategoryCategory Lion Nathan Key brandsLion Nathan Key brandsLion Nathan Key brandsLion Nathan Key brands

Craft beer Mac’s

International Speciality Guinness, Leffe, Boddingtons, Kilkenny, Hoegaarden, Little Creatures

International Premium (5%) Corona, Stella Artois, Beck’s

Domestic Super Premium & Domesitic Premium

Steinlager PureSteinlager Classic

Mainstream (4%) Speight’s Gold Medal Ale, Lion Red, Waikato Draught, Speight’s Summit Lager

Value Tasman, Rheineck, Castlepoint, Ice Beer

Low alcohol Light Ice, Steinlager Premium Light


% Vol% Vol% Vol% VolMainstream

Value

Low Carb

LowAlcohol

Premium

International Speciality


Domestic Premium

Craft

26262626

7%

0%-3%

1%3% 4% 4%

31%

-1%

10%

-8%

35%

10% 6%

-5% -6%

79%

-11% -15% -20%

Australian Wine market profile – by varietal

White wineWhite wineWhite wineWhite wine



Red wineRed wineRed wineRed wine

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WhiteWhiteWhiteWhite

-4%

1%3%

21%

12%

3%

-6%

4%2%

25%

10%

-3%

Under $7 $7-$10 $10-$15 $15-$20 $20-$30 Over $30

MAT Growth Qtr Growth

Australian Wine market profile – by price point



-6%

1%2%

12%14%

3%

-7%

3%5%

12% 12%

-3%

Under $7 $7-$10 $10-$15 $15-$20 $20-$30 Over $30


1%

-6%

3%5% 6%

10%

6%

-3%

0%

18%

6%

-1%

Under $7 $7-$10 $10-$15 $15-$20 $20-$30 Over $30


RedRedRedRed SparklingSparklingSparklingSparkling

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Australian alcoholic beverages landscape


X

LN opportunity

Size = segment value ($M); X = Lion Nathan share

LN strong hold today

Segment Value CAGR 06-08 (%)

Economic Profit (% of sales)

Dark RTD

Premium beer

Mainstream beer

Bottled wine

Cask wine Dark spirit

White RTD

White spirit

UnattractiveUnattractiveUnattractiveUnattractive

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7777111125252525

Fine Wine

7777

Recent growth rate higher than 2 year CAGRRecent growth rate lower than 2 year CAGR

Attractive market segments

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29292929

Lion Nathan Limited






BUSINESS OVERVIEW I MARKET DATA I BUSINESS OVERVIEW I MARKET DATA I BUSINESS OVERVIEW I MARKET DATA I BUSINESS OVERVIEW I MARKET DATA I STRATEGY & GROWTH DRIVERS STRATEGY & GROWTH DRIVERS STRATEGY & GROWTH DRIVERS STRATEGY & GROWTH DRIVERS I FY08 RESULTS I APPENDIXI FY08 RESULTS I APPENDIXI FY08 RESULTS I APPENDIXI FY08 RESULTS I APPENDIX

30303030

We have a vision …

BUSINESS OVERVIEW I MARKET DATA I BUSINESS OVERVIEW I MARKET DATA I BUSINESS OVERVIEW I MARKET DATA I BUSINESS OVERVIEW I MARKET DATA I STRATEGY & GROWTH DRIVERSSTRATEGY & GROWTH DRIVERSSTRATEGY & GROWTH DRIVERSSTRATEGY & GROWTH DRIVERS I FY08 RESULTS I APPENDIXI FY08 RESULTS I APPENDIXI FY08 RESULTS I APPENDIXI FY08 RESULTS I APPENDIX

Sociability guides our vision, backed by great brands and great peopleSociability guides our vision, backed by great brands and great peopleSociability guides our vision, backed by great brands and great peopleSociability guides our vision, backed by great brands and great people

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… and defined strategies


GROWTH GROWTH GROWTH GROWTH BEYONDBEYONDBEYONDBEYOND

THE CORETHE CORETHE CORETHE CORE

- Continue to build ‘great people’ and culture

- Embed marketing, sales, operations and finance capability

- Maintain lowest cost position and leverage new brewery asset base

- Drive sustainable practices throughout the business

- Invest and drive value in premium and power brands

- Innovate against profitable market opportunities

- Maximise upside from Boag’s acquisition

- Optimise customer engagement and sales force effectiveness

- Build sales platforms against selected international growth opportunities

- Maximise value from spirits/RTD

- Widen the appeal of beer and promote responsible consumption

STRONG STRONG STRONG STRONG PLATFORMPLATFORMPLATFORMPLATFORM

GROWTH GROWTH GROWTH GROWTH FROM FROM FROM FROM

THE CORETHE CORETHE CORETHE CORE

32323232

NPAT outlook FY09


* FY09 guidance range excludes the impact of one-time and significant items

FY09 NPAT guidance of $300M FY09 NPAT guidance of $300M FY09 NPAT guidance of $300M FY09 NPAT guidance of $300M ---- $315M$315M$315M$315M

BOAG’SBOAG’SBOAG’SBOAG’S

LNA upLNNZ up

FY09*FY09*FY09*FY09*

272.7 M272.7 M272.7 M272.7 M

315 M315 M315 M315 M

300 M300 M300 M300 M

+16%+16%+16%+16%

+10%+10%+10%+10%

Full year of savings target A$15m

Hahn Super DryWhite StagSummitSteinlager Pure

Dilutive 08 to accretive 09

FY08FY08FY08FY08

5-7% increasein COGSanticipated

CORE CORE CORE CORE EARNINGS EARNINGS EARNINGS EARNINGS GROWTHGROWTHGROWTHGROWTH

INVESTINVESTINVESTINVESTSAVINGSSAVINGSSAVINGSSAVINGS

GROWTH GROWTH GROWTH GROWTH FROMFROMFROMFROM

INNOVATIONINNOVATIONINNOVATIONINNOVATION

COGS & COGS & COGS & COGS & FXFXFXFX4 drivers underpin F09

step up - offset by COGS & FX impact

BOAG’SBOAG’SBOAG’SBOAG’S

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Great brands

� Focused effort around a group of high potential “power brands”

� Continue to invest behind our brands to enhance brand equity (8-10% of NSR is dedicated to brand marketing)

� FY08 Marketing spend up 7% excl Boag’s, up 17% including Boag’s

� Real successes in innovations in both Aust and NZ

� Growing brands in growing segments

� Creating a “customer pull” model

34343434

Core earnings growth – power brand strategyBUSINESS OVERVIEW I MARKET DATA I BUSINESS OVERVIEW I MARKET DATA I BUSINESS OVERVIEW I MARKET DATA I BUSINESS OVERVIEW I MARKET DATA I STRATEGY & GROWTH DRIVERSSTRATEGY & GROWTH DRIVERSSTRATEGY & GROWTH DRIVERSSTRATEGY & GROWTH DRIVERS I FY08 RESULTS I APPENDIXI FY08 RESULTS I APPENDIXI FY08 RESULTS I APPENDIXI FY08 RESULTS I APPENDIX

Volume

70%70%70%70%80%80%80%80%

30%20%

2004200420042004 2008e2008e2008e2008e

Margin

78%78%78%78% 87%87%87%87%

22% 13%

2004200420042004 2008e2008e2008e2008e

Volume

71%71%71%71% 77%77%77%77%

29% 23%

2004200420042004 2008e2008e2008e2008e

Margin

75%75%75%75% 82%82%82%82%

25% 18%

2004200420042004 2008e2008e2008e2008e

New ZealandNew ZealandNew ZealandNew Zealand

AustraliaAustraliaAustraliaAustralia

Power brands continuing to grow and improve margins

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35353535

Accelerating sales CAGR


Based on net sales revenue (excl Boag’s)Based on net sales revenue (excl Boag’s)Based on net sales revenue (excl Boag’s)Based on net sales revenue (excl Boag’s)

AustraliaAustraliaAustraliaAustralia New ZealandNew ZealandNew ZealandNew Zealand

3.6

%3

.6%

3.6

%3

.6%

6.2

%6

.2%

6.2

%6

.2%

6.5

%6

.5%

6.5

%6

.5%

10 year

CAGR

3 year

CAGR

1 year

growth rate

0.2

%0

.2%

0.2

%0

.2%

1.3

%1.

3%

1.3

%1.

3%

5.6

%5

.6%

5.6

%5

.6%

10 year

CAGR

3 year

CAGR

1 year

growth rate

Successful innovation driving Successful innovation driving Successful innovation driving Successful innovation driving acceleration in sales growthacceleration in sales growthacceleration in sales growthacceleration in sales growth

36363636

Connecting with consumers


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Australia - successful innovation

Hahn Super Dry

Barefoot Radler

Classic Blonde

Tooheys Extra Dry innovations

2%

6%

10%

F06F06F06F06 F07F07F07F07 F08F08F08F08


NPD / innovations launched in the last NPD / innovations launched in the last NPD / innovations launched in the last NPD / innovations launched in the last three years make up three years make up three years make up three years make up

10% 10% 10% 10% of the FY08 Net Sales Revenueof the FY08 Net Sales Revenueof the FY08 Net Sales Revenueof the FY08 Net Sales Revenue

38383838

0%

3%

10%

F06F06F06F06 F07F07F07F07 F08F08F08F08

New Zealand - successful innovation

Steinlager Pure

Speight’s Summit

Mac’s new products


NPD / innovations launched in the last NPD / innovations launched in the last NPD / innovations launched in the last NPD / innovations launched in the last three years make up three years make up three years make up three years make up

10% 10% 10% 10% of the FY08 Net Sales Revenueof the FY08 Net Sales Revenueof the FY08 Net Sales Revenueof the FY08 Net Sales Revenue

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39393939

Speight’s Summit launched May 2008


� New Speight’s lager brewed with only natural ingredients

� “Don’t mess with nature” campaign an instant hit with consumers. Ranked a “favourite ad” by consumers within one month of launch

� Planned volume exceeded in FY08

� 90% weighted distribution achieved in two months

� Brand health measures ahead of target levels

� Highly successful tap launch

40404040

Tooheys White Stag launched September 2008


� First low carb offering in traditional mainstream segment

� 1/3 of the carbs of standard full strength beers

� Leveraging the recent Tooheys New campaign “Tooheys New White Stag is another great idea from Tooheys New”

� Supported by above-the-line and below-the-line marketing activities

� Strong initial distributions achieved and positive consumer feedback on brew

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41414141

Steinlager Pure

� Highly successful new premium beer

� 100% New Zealand ingredients

� > 1 million cases sold and growing strongly

� Selling at $26.99 a 12 pack, a ~$5 premium to Heineken

� Won grocery “new product of the year” in 2008, (across all categories of grocery)

� Successfully flanked Steinlager Classic, Total Steinlager trademark up 44% in FY08

� Now being exported to US, Australia and UK


42424242

Investing in our breweries

Investing in our breweries� We have invested across the brewing process,

in 4 major breweries, XXXX Castlemaine, Tooheys, Auckland and Boag’s

� Project Invest – upgrades to XXXX and Tooheys breweries are nearing completion, on target to deliver $15m savings per annum once complete

� The investment in our breweries enables:

� Higher levels of flexibility � Greater brewing capacity� A reduced environmental footprint� Reduced costs� Even better beer

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43434343

Capex


$ m

illio

n$

mill

ion

$ m

illio

n$

mill

ion

Investment period will continue into FY09, with forecast capex spend of

$225m to $275m

7676 7676

109

109

109

109

111

111

111

111

FY05 FY06 FY07 FY08 FY09

RangeAuckland breweryBoag’sTooheys & XXXX upgradesUnderlying

25

22

52

25

22

52 2

752

752

752

752

25

22

52

25

22

5

44444444

Scope of brewery upgrades


UTILITIESUTILITIESUTILITIESUTILITIES

- Replacement and automation of existing boilers � �

- Upgrade air, refrigeration, electrical & energy management systems � �

- New waste water recovery system N/A �

BREWHOUSE AND CELLARSBREWHOUSE AND CELLARSBREWHOUSE AND CELLARSBREWHOUSE AND CELLARS

- Upgrade brewhouse automation capacity �

- Automation of cellars including yeast handling � N/A

- New brewhouse, fermentation vessels � � �

FILTRATIONFILTRATIONFILTRATIONFILTRATION

- Replace and upgrade filtration technology and associated services � �

PACKAGING DEVELOPMENTPACKAGING DEVELOPMENTPACKAGING DEVELOPMENTPACKAGING DEVELOPMENT

- New can line � N/A

- Upgrades of bottling lines with increased multipack capability � �

- Introduction of robotics for palletising � �

- Relocate new and existing packaging equipment in building extension N/A �

- General packaging upgrades �

SCOPE TOOHEYS XXXX BOAG’S

Extensive upgrade reducing future capex requirementsExtensive upgrade reducing future capex requirementsExtensive upgrade reducing future capex requirementsExtensive upgrade reducing future capex requirements

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45454545

Auckland Brewery on track

F07F07F07F07 F08F08F08F08 F09F09F09F09

Announced new

brewery and facility

Sold Auckland Brewery

site & purchased greenfield

site

Earthworks commenced Construction

commencedNew site

fully operational

First brew from new brewery

anticipated

� Construction of the new brewery in Auckland is progressing to plan

� The new facility is expected to deliver NZ$15m in EBITDA savings per annum once complete

� Total cost NZ$250m

� Sold current site for NZ$162m� $50m received with remainder payable

when current site is vacated

F10F10F10F10 F11F11F11F11


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Auckland Brewery on track


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47474747

Boag’s brewery investment

F08F08F08F08 F09F09F09F09

Announced investment

Construction commenced

Fully operational

F10F10F10F10

First brew anticipated

� Boag’s beers are brewed exclusively at the Esk brewery in Launceston, Tasmania

� Investment in the brewery was announced in June 2008, increasing capacity from 50 million litres to 100 million litres


48484848

Boag’s – a key growth driver

� �� !�� "��##��$

� Acquisition of Boag’s completed 2 January 2008

� Highly complementary to our existing portfolio of brands

� Successful fast-track integration

� Boag’s Draught made available on tap on the mainland in FY08

� Investing in the brand – with new packaging and advertising

� Committed to Tasmanian provenance (investing in Boag’s brewery)

� Volumes for the Boag’s trademark were up 6% in the second half

��

49494949

Our people


� High people engagement scores

� High customer satisfaction and engagement scores

� Invested in sales and marketing as a core competency

� Invested in sales technology to improve productivity

� In-sourced strategy development to allow our people to guide our future and to improve engagement

� Consistently recognised as a leading employer with top quartile people engagement scores

� Extended planning horizon so that we do the right thing for the long term

50505050

People engagement drives customer and consumer engagement


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People engagement at 85%

100%100%100%100%

Below Global High Below Global High Below Global High Below Global High Performance Performance Performance Performance

Engagement ZoneEngagement ZoneEngagement ZoneEngagement Zone

Engaging ZoneEngaging ZoneEngaging ZoneEngaging Zone

Global High Performance ZoneGlobal High Performance ZoneGlobal High Performance ZoneGlobal High Performance Zone

Top Quartile of Global High Top Quartile of Global High Top Quartile of Global High Top Quartile of Global High Performance ZonePerformance ZonePerformance ZonePerformance Zone

10%10%10%10%

20%20%20%20%

30%30%30%30%

40%40%40%40%

50%50%50%50%

60%60%60%60%

70%70%70%70%

80%80%80%80%

90%90%90%90%Global High Performance Global High Performance Global High Performance Global High Performance Companies Norm Average Companies Norm Average Companies Norm Average Companies Norm Average 80%80%80%80%

Australian National Norm Australian National Norm Australian National Norm Australian National Norm Average 71%Average 71%Average 71%Average 71%

Source: Towers Perrin ISR, LN People and Customer Engagement Survey 2008


85% of Lion people say they are fully

engaged

People engagement benchmarked as global high performancePeople engagement benchmarked as global high performancePeople engagement benchmarked as global high performancePeople engagement benchmarked as global high performance

52525252

Australia

NZ

Highly engagedEngagedNeutral / disengaged

Customer engagement

80%

87%

Lion Nathan ranks number 1 in Customer satisfaction Lion Nathan ranks number 1 in Customer satisfaction Lion Nathan ranks number 1 in Customer satisfaction Lion Nathan ranks number 1 in Customer satisfaction surveys in Aus & NZsurveys in Aus & NZsurveys in Aus & NZsurveys in Aus & NZ


80% of our Australian customers and 87% of our NZ customers are

positively engaged

��

53535353

Doing the right thing for the long term

We will continue enhancing our Sustainability

reporting

We are assessing our carbon

footprint to highlight reduction

opportunities

$We have committed to invest at at at at

least 1% of our NPAT each least 1% of our NPAT each least 1% of our NPAT each least 1% of our NPAT each year year year year on voluntary community

initiatives

Sustainability Leadership Group formed from cross

functional leaders

Sustainability Ambassador program launched

Our new office locations in Sydney & Auckland

incorporate environmental design

elements


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