Ebro Foods S A : Other relevant information - On business and financial situation

TO THE NATIONAL SECURITIES EXCHANGE COMMISSION OF SPAIN

Madrid, 26 July 2022

Ref: presentation to analysts announced this morning, regarding the Group Ebro Foods results for the first half of 2022.

In pursuance of section 227 of the Securities Market Act, Ebro Foods, S.A. hereby publishes as

OTHER RELEVANT INFORMATION

the presentation to analysts announced this morning, relating to the results for the first half of 2022 that will be held today in the Board Meeting Room located on the second floor of our head office in Paseo de la Castellana 20th, Madrid.

Yours faithfully,

Luis Peña Pazos

Secretary of the Board of Directors

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RESULTS H1 2022

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CONTENTS

1. INTRODUCTION
2. BUSINESS UNIT RESULTS H1 2022
3. 1. Rice
   2. Pasta
4. CONSOLIDATED GROUP RESULTS H1 2022
5. 1. P&L
   2. Debt Performance
6. CONCLUSION
7. CORPORATE CALENDAR 2022
8. CALCULATION OF ALTERNATIVE PERFORMANCE MEASURES
9. LEGAL DISCLAIMER

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INTRODUCTION

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1. Introduction

At the end of H1, cost inflation remains very much on the rise with no signs of waning.

Freight costs have remained high, but the Group's strategic foresight to rely on our own platforms, scale up and upgrade from containers to full boats is helping to give us the competitive upper hand.

The sharp growth in the labour market has stepped up, with the most complex factor being hiring in the Group's main markets, such as Canada, the US and France, where recruiting staff is extremely complicated.

We are experiencing a drop in demand, as distributors and consumers work through significant stockpiles built up as a result of food shortage fears at the start of the war in Ukraine.

We have completed the sale of Roland Monterrat, the French sandwich and fresh pasta company based in France which, due to a number of reasons, did not perform as well as expected while under the Group's ownership. The claim lodged against the sellers remains open.

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BUSINESS UNIT RESULTS

H1 2022

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2.1.1 Rice H1 2022

The more ominous weather forecasts have proven to be accurate, which has heavily impacted Japanese rice crops (paella, risotto and sushi). Planting has slumped to just 30% of the typical area planted in Andalusia, barely 10% in Extremadura and 60% in California. Italy was able to plant 80% of its typical area. Australian harvest is finally back to normal after several long years of drought, which will help to offset these losses, but we still expect prices to rise substantially with the arrival of the new harvests.

In contrast, traditional long-grain varieties have remained stable in Asia, with the exception of basmati rice, which has increased in price dramatically. The price of long-grain rice has increased in the US, forcing Riviana to request a fresh price increase.

Demand has started to stall in the US due to price rises, as well as consumers and distributors working through the significant stockpiles built up as a result of food shortage fears at the start of the war in Ukraine.

In terms of sales, our star products are still performing strongly: aromatic varieties, microwave rice and instant rice.

We made reasonable profits in H1, largely thanks to our excellent supply chain and the strength of our brands.

Over the course of H2, we will accelerate our business restructuring plan in the US, once the transition period comes to an end following the sale of the dry pasta division.

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2.1.2 Rice H1 2022

Turnover rose 27.5% to EUR1,136.1 million during H1, registering a steady average growth rate of over 7% for the past two years.

The Division's Ebitda-A increased by 17.8% to EUR146.6 million, with profitability falling by 110 b.p. to a margin of 12.9%, due to cost increases, even after investing 28.9% more in advertising. On a Q2 standalone basis, Ebitda-A grew by 24.1%. The exchange rate had a positive impact of EUR6.2 million on Ebitda-A.

Operating Profit grew 20% to EUR112.7 million.

EUR Thous.	H1 2020 H1 2021 H1 2022	22/21	CAGR 22/20
Sales	987,642	891,287	1,136,111	27.5%	7.3%
Advertising	21,037	18,875	24,337	28.9%	7.6%
Ebitda-a	133,791	124,446	146,643	17.8%	4.7%
Ebitda-a Margin	13.5%	14.0%	12.9%
Ebit-a	105,278	95,770	114,447	19.5%	4.3%
Operating Profit	103,201	93,890	112,689	20.0%	4.5%

* In H1 2021 and H1 2022, the Panzani rice business was reclassified from the Pasta Division to the Rice Division.

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2.2.1 Pasta H1 2022

In the premium pasta segment, Garofalo performed strongly in H1, with sales up by 10% in Italy and significant growth in Spain and France. Profits in the US were undercut by high freight costs.

The price of durum wheat still stands at over EUR560 per tonne, which is unlikely to change unless Canada has a bumper harvest at the end of the summer. Durum wheat planting increased by 23% in Canada compared to the previous harvest.

We therefore anticipate higher costs and lower demand in H2, without the impulse buying seen at the start of the war in Ukraine.

Fresh pasta had a poor second quarter overall, as the increases required to offset higher costs took longer to be implemented.

This was exacerbated by lower productivity in France and Canada, caused by delays in the arrival of new machinery and a lack of personnel to fill all of the production lines.

The fresh pasta market was down 1% in France, while stuffed pasta sales fell slightly more, although gnocchi sales continue to rise.

The heatwaves in southern Europe are making people less likely to eat carbohydrates.

Bertagni recorded turnover growth, especially in the US (+20%), while progress has been made on consolidating the required price increases in H1.

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