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AGRICULTURE, FOOD AND LIFE

SCIENCES SERVICES @ SGS


OLIVIER COPPEY – EXECUTIVE VICE PRESIDENT
INVESTORS DAYS, 29-30 OCTOBER 2015

Olivier joined SGS in 1994 in Cameroon


He has been Executive Vice President since 2013.
He was responsible for Agricultural Services until
January 2016, when the strategic focus of this
business line expanded to become Agriculture,
Food and Life.

https://www.sgs.com/-/media/global/documents/presentations/sgs-corpcom-biographies-operations-council-en-web.pdf?la=en

© SGS SA 2015 ALL RIGHTS RESERVED – SGS INVESTOR DAYS – 29 – 30 OCTOBER 2015 1
STRATEGIC REALIGNMENT

© SGS SA 2015 ALL RIGHTS RESERVED – SGS INVESTOR DAYS – 29 – 30 OCTOBER 2015 2
RATIONALE FOR THE MERGER

 Align our organization to the market by having a coherent sales and


marketing structure that can sell the full SGS service portfolio across
the value chain
 Sell solutions to the industry instead of individual services (inspection,
testing, audit/certification, data management, advisory services, etc.)
and become the global partner of choice
 Renew our focus on Life Sciences laboratories
 Accelerate revenue growth by having a coordinated strategy for organic
and inorganic development
 Improve operational margins by rationalizing the network and optimizing
the use of resources

© SGS SA 2015 ALL RIGHTS RESERVED – SGS INVESTOR DAYS – 29 – 30 OCTOBER 2015 3
NEW STRUCTURE

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POSITIONING

We have created a unique and seamless operating structure that will reinforce our
leading position in the Agri-Food & Health industries. Our reconfigured global
network of experts and laboratories will respond to the present and future
requirements of the market. We will deliver unparalleled competitive advantage to
our customers through innovative solutions and technologies on quality, safety and
sustainability, for the R&D, primary production, trade, manufacturing & retailing
segments.

 Among the largest global TIC service providers to the Agri-Food industries with
the most comprehensive solutions, the largest geographical footprint and by far
the largest reach across the entire value chain
 One of the four largest business lines of SGS Group evolving in a recession-
resistant market with strong underlying fundamentals

Overview of Services

© SGS SA 2015 ALL RIGHTS RESERVED – SGS INVESTOR DAYS – 29 – 30 OCTOBER 2015 5
GROWTH DRIVERS & TRENDS
FOOD SEGMENT

 Sustainable growth drivers for the TIC industry


 Increase in outbreak of food borne illness and poisoning (widely covered by the
media)
 Implementation of stringent food and feed regulations (EU, FSMA, etc.)
 Increased consumer awareness and demand for nutritious and safe food
 Globalization of the production and food supply chain requires increased
transparency & traceability
 Reputational risks for brand owners
 New inputs and veterinary drugs used in primary production requiring additional
testing on crops, fish and meat
 Outsourcing trend & market consolidation

 Key mega trends


 Health & wellness
 Sustainability & ethics Drives INNOVATION in
Processing, Packaging, Safety & Quality and
 Authenticity Product Formulation
 Convenience

© SGS SA 2015 ALL RIGHTS RESERVED – SGS INVESTOR DAYS – 29 – 30 OCTOBER 2015 6
FOOD SAFETY REMAINS A MAJOR ISSUE

Food producers and manufacturers operate in a vast, globalized supply chain,


where one mislabelled product or contaminated ingredient can cause sickness,
death, multi-million dollar commercial losses, not to mention severe and lasting
reputational damage.
Facts from the largest food market [USA]:
 Number of product recalls per year in the US has almost doubled since 2002
 Food contamination costs US health authorities USD 15.6 billion per year;
nearly 9 million Americans became sick from contaminated food in 2013 alone
 Half of all the food recalls cost the affected companies more than USD 10
million per recall
 The globalized food supply chain makes risk management for food recalls more
difficult.

© SGS SA 2015 ALL RIGHTS RESERVED – SGS INVESTOR DAYS – 29 – 30 OCTOBER 2015 Ref. Swiss Re's Food Safety in a Globalised World 2015 7
INTEGRATED SUPPLY CHAIN
MARKET APPROACH

https://www.youtube.com/watch?v=o4Q2wF7CXxA
Our core services can be divided into four categories:

 Inspection services Inspection: our comprehensive range of world-leading inspection and verification services, such as
checking the condition and weight of traded goods at transshipment, help you to control quantity and quality,
and meet all relevant regulatory requirements across different regions and markets
 Analytical services Testing: our global network of testing facilities, staffed by knowledgeable and experienced personnel,
enable you to reduce risks, shorten time to market and test the quality, safety and performance of your
products against relevant health, safety and regulatory standards
 Audit & Certification services compliant
Certification: we enable you to demonstrate that your products, processes, systems or services are
with either national or international standards and regulations or customer defined standards,

 Training services
through certification
Verification: we ensure that products and services comply with global standards and local regulations.
Combining global coverage with local knowledge, unrivalled experience and expertise in virtually every

 Advisory services industry, SGS covers the entire supply chain from raw materials to final consumption.

© SGS SA 2015 ALL RIGHTS RESERVED – SGS INVESTOR DAYS – 29 – 30 OCTOBER 2015 8
EXAMPLE: TÖNNIES LEBENSMITTEL

INTEGRATED
SOLUTIONS
FOR

QUALITY, SAFE
& SUSTAINABLE
PRODUCTS
ACROSS THE
VALUE CHAIN

© SGS SA 2015 ALL RIGHTS RESERVED – SGS INVESTOR DAYS – 29 – 30 OCTOBER 2015 9
OPERATIONS NETWORK

With almost 13,000 employees around the world,


Agriculture Food Life Sciences has the most extensive network
of operations to respond to our clients' needs

© SGS SA 2015 ALL RIGHTS RESERVED – SGS INVESTOR DAYS – 29 – 30 OCTOBER 2015 10
LABORATORIES NETWORK

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OUR PEOPLE

 Network powered by Expert Teams of


- Scientists, - Inspectors,
- Food Technologists, - Fumigators,
- Agronomists, - Engineers,
- Field trialists, - Training specialists,
- Drone operators, - Auditors.
 All working together to provide a holistic and multi-disciplinary approach
to best serve our clients in the Agri-Food & Life Sciences industries
 A team of passionate SGS employees driven by passion

Foodies @ SGS Hong Kong

© SGS SA 2015 ALL RIGHTS RESERVED – SGS INVESTOR DAYS – 29 – 30 OCTOBER 2015 12
SVA ACQUISITION (MAY 2015)

 SVA Ltd is a leading independent provider of an extensive range of advisory, testing and
innovative IT services to the food and consumer products industry, headquartered in the
UK.
 Founded in 2010 and privately owned, SVA employs 200 highly skilled specialists and
generated revenue in excess of GBP 14 million in 2014.
 Scope:
 Advisory services on legal and regulatory compliance (product labels, specifications, etc.)
Approves product labels and specs on over 750 retailer own branded products per month
 Microbiological, chemical, nutritional and compliance driven testing services
More than 35,000 tests monthly on over 5,000 products
 IT/eVision: suite of product management software tools to gather, manage and manipulate the
extensive amount of validated data produced by all of these services for the clients

© SGS SA 2015 ALL RIGHTS RESERVED – SGS INVESTOR DAYS – 29 – 30 OCTOBER 2015 13
SGS in Ireland

SGS Ireland has been active in Ireland for over 40 years and currently has
a network of 38 locations around the Republic of Ireland that is home to over 220 employees.

We offer a range of inspection, verification, testing and certification services across


a variety of business lines, including agriculture, minerals, oil, gas and chemicals, automotive
and industrial services.

We work with private companies and government agencies as an outsourced provider and
trusted partner.

Our Services in Ireland:

 Agriculture & Food


 Chemical
 Construction
 Consumer Goods & Retail
 Energy
 Environment
 Health & Safety
 Industrial Manufacturing
 Life Sciences
 Logistics
 Mining
 Oil & Gas
 Public Sector
 Risk Management
 Sustainability
 Trade
 Training Services
 Transportation

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