INTEGRATED ANNUAL REPORT 2024

for the year ended 30 September 2024

Informed by a thorough analysis of global, regional and local trends specific to the FMCG and retail sectors, we have prioritised three growth platforms aimed at driving broader consumer and shopper relevance and increasing market success.

Given the current highly dynamic consumer and competitor environment – with many consumers trading down and with heightened market pressure from new and traditional competitors – we have identified three key growth platforms for our brand portfolio to drive broader consumer and shopper relevance and ensure longer-term success: driving affordability, democratising health and nutrition, and over-indexing on snackification.

Driving affordability to be the lead choice for value-seeking consumers

Our ambition is to become the leading choice for value-seeking consumers and shoppers, and to defend against the rise of private label, by enhancing the affordability and accessibility of our existing and new product offerings. We are driving affordability through appropriate pack, price and channel architecture and targeted brand tiering, by harnessing effective distribution channels and by realising opportunities for product and packaging innovation, supported by value-led marketing and consumer engagement campaigns and our broader cost reduction initiatives.

We have made further progress this year in these ambitions, delivering value-for-money innovations in selected categories to ensure more affordable price points. Recent and planned innovations include the introduction of new value packs and new value offerings in Culinary, and in Snacks, Treats and Beverages. Within Culinary, an important strategic focus is on providing "Plus Foods" – local branded products that consumers "Add-2-Food" to elevate and stretch their meal or snack, through affordable, convenient and trusted nutritional offerings. This includes launching new sub-brands in certain product categories, that deliver an affordable and nutritional product offering at different price points.

These various innovations across our product portfolio will be aided by our continuing activities to enhance efficiency and reduce costs, as well as by delivering on our goals to compete more effectively in the deep discounter channel.

Informed by renewed insight and analysis, we have refreshed the board-approved principles to best defend our product offerings against the increasing threat of private label. We will be further investing in our brands, building our innovation capabilities, protecting our intellectual property, and offering consumers choice through our premium and value offerings, supported by the right price and pack architecture. Our revised operating model is geared to growing our brands, with a clear governance process for evaluating private label and sign off. We will only manufacture private label products in selected categories where we see clear long-term commercial and strategic benefit, informed by a thorough cost-benefit assessment, with approval from the Exco.

Democratising health and nutrition

As one of Africa's largest food company, our health and nutrition agenda is integral to our purpose of nourishing and nurturing more lives every day. In addition to the broader socio-economic and moral imperative of driving positive change in health and nutrition, we believe that there are valuable opportunities for business growth in leading this agenda in our markets.

In the lower income market, we aim to democratise nutrition by driving awareness, accessibility and affordability of our healthy food portfolio. This includes, for example, an educational campaign on the health and nutritional benefits of some of our brown bread product offerings. We are amplifying our nutrition communication to drive category leadership by leveraging on our "eat well, live well" labelling, and we are making healthier products more accessible through increased availability in general trade. To close nutrient gaps, we enrich many of our affordable nutrition food offerings with nutrients that are often lacking in the South African diet – such as Vitamin A, iron, zinc and protein – ensuring that we strike the right balance between taste and enhanced nutritional value. In the higher income market we are innovating across categories to unlock snacking options.

This year, we launched new healthier "free from" and lower calorie product lines in Culinary and Snacks, Treats and Beverages, including new sugar-free wine gums and tomato sauce, lower calorie, sugar-free beverages products, and new healthier breakfast cereal oat biscuits. We have also continued the roll-out of clear consumer-relevant health claims on various brands. Through our renovation and innovation efforts, we are aiming to ensure that by 2030, 65% of our food basket will meet our EWLW nutritional standards for healthier product categories "improved for you" and "good for you".

We are continuing to promote consumer health and nutrition awareness through our on-pack and beyond-pack communication – with information for example on healthy portion sizes and product pairings – and by inspiring consumers with everyday nutritious meals through tasty recipes.

Responding to the snackification trend

Recent research confirms that snacking is continuing to gain momentum in South Africa, with more than 70% of South Africans estimated to be snacking on a daily basis across all consumer age groups. We aim to capitalise on this growing trend by owning relevant demand spaces for consumers in all key snacking categories, including liquification, nano-meals, crunch time and sweet pleasures.

In driving innovation to capitalise on this trend, we have various recent and planned product innovations. In launching new products, we are spending equal effort to develop robust pipelines to enter adjacent categories, aligned with our core and emerging capabilities.