Royal Unibrew. Dividend story set for a comeback. Target price change BREWERS, DENMARK. Undramatic Q2 results, in our view

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1 BREWERS, DENMARK Target price change Royal Unibrew Dividend story set for a comeback Undramatic Q2 results, in our view Consolidation of Hartwall drives minor estimate changes ACCUMULATE; target price lifted to DKK 660 (650) Weather gave guidance tailwind As expected, management narrowed guidance to the upper end of the otherwise reiterated guidance, on the back of favourable weather in Q3. That aside, we view the Q2 20 results as close to expectations, with a betterthan-expected revenue improvement driven partly by stock-building and nonrecurring opportunities. Hartwall in focus The recently completed acquisition of Hartwall obviously stole a significant part of the spotlight, and Hartwell s inclusion from ust 23 is also the main reason for our estimate adjustments, which are otherwise very modest. Scope for at least 10% yield from 2015e Royal Unibrew reiterated its intension to reassume dividends and share buybacks in 2015, and we see room enough to lift our annual buyback assumption to DKK 400m (DKK 300m), starting after the AGM in In combination with dividends, this means that we now expect an annual yield of 10-%. Royal Unibrew remains an unusual dividend story in the brewery sector, and we reiterate our ACCUMULATE recommendation while lifting our -month target price slightly to DKK 660 (DKK 650). Casper Blom, , cabl03@handelsbanken.se Company page on Handelsbanken s REON Results Comment Q , 20 Share price (DKK): 620 Mkt cap (EURm): 809 Mkt cap (DKKm): 6,034 No of shares (m): 9.7 Est. buybacks next m (% of MC): n.m Free float (%): 100 Avg daily volume (000'): 20 Avg daily value (EURm): 2 Bloomberg: RBREW DC Reuters: RBREW.CO Web address: Link to company website IR web address: Link to IR website Next event: Sep 26, 20: EGM m target return Target price, inc. div. (DKK): 660 Expected total return (%): 6.5 Expected total dividend yield (%): 0 DCF Value (DKK): 610 Balance sheet 20 Net debt (DKKm): Net debt/equity (%): 27.7 ROE (%): 28.0 ROIC (%): 26.0 Main owners Votes (%) Capital (%) Chr. ustinus Fabrikker A Hartwall Capital Oy Ab 9 9 DKKm e 2014e 2015e Sales 3,431 3,430 4,256 5,923 6,072 Sales growth (%) EBITDA adj ,007 1,061 margin (%) EBIT adj margin (%) EBT EPS reported (DKK) EPS adj (DKK) Y-o-y growth (%) EPS adj revisions (%) n.m P/E adj (x) P/BV (x) ROE adj (%) EV/EBIT (x) EV/EBITDA (x) EV/sales (x) FCFE adj yield (%) Tot DPS (DKK) Tot Div yield (%) Net debt/equity (%) Absolute and relative performance DKK Index A S O N D J F M A M J J A 90 Royal Unibrew rel. DJ Stoxx 600 % -1m -3m -m Absolute: Absolute EUR: Relative DJStoxx: w range (DKK): 603 / 379 Source: Reuters For full disclaimer and definitions, please refer to the end of this report.

2 Sales better than expected, while EBIT was just below our estimate P&L outcome, Q2 Growth % Deviation % DKKm Actual Y-o-y Q-o-q HCM Cons Sales 1, EBITDA adj margin (%) EBIT adj margin (%) EBT Net income EPS reported EPS adj Source: Company accounts, Handelsbanken Capital Markets, Reuters Q3e will be affected by Hartwall coming into the books Trend analysis % Q2 Q3 Q4 Q1 Q2 Q3 e Sales y-o-y EBITDA adj Y-o-y EBITDA adj margin EBIT adj Y-o-y EBIT adj margin EPS adj (DKK) EPS adj Y-o-y Source: Company accounts, Handelsbanken Capital Markets Northeastern Europe will increase its importance Business area breakdown Sales - DKKm Q2 Q3 Q4 Q1 Q2 Q3 e Western Europe Northeastern Europe Malt Beverages Total ,042 1,218 EBIT - DKKm Western Europe Northeastern Europe Malt Beverages Oth & eliminations Total EBIT margin % Western Europe Northeastern Europe Malt Beverages Total Royal Unibrew, Brewers, Denmark ust 28, 20

3 What has changed HCM chg HCM chg HCM chg DKKm Q3 e (%) 20e (%) 2014e (%) Sales 1, , ,923 0 EBITDA adj ,007-5 margin (%) EBIT adj margin (%) EBT Net income EPS EPS adj HCM vs. consensus Cons diff Cons diff Cons diff DKKm Q3 e (%) 20e (%) 2014e (%) Sales , ,905 0 EBITDA adj ,008 0 margin (%) EBIT adj margin EBT Net income EPS EPS adj Ownership structure 23 ust 20 Votes (%) Capital (%) Chr. ustinus Fabrikker A/S Hartwall Capital Oy Ab Skagen AS ATP Number of A-shares Number of B-shares Total Free float 0 11,186,498 11,186, % & Reuters Investment case summary A new story The deal to take over Hartwall has become Royal Unibrew's main focus, temporarily putting dividends and buybacks on hold. But the old story may return We see nice room for debt coming down quickly following the Hartwall deal, and expect double-digit payout again from 2015e. Can they do it again? Current management has once before brought down debt and lifted payouts: the question now is if they can do it again. Revenue, -month rolling EBIT, -month rolling DKKm % DKKm % 4, , , , Q2 Q3 Q4 Q1 Q2 Q3 e Q4 e Q1 14e Q2 Q3 Q4 Q1 Q2 Q3 e Q4 e Q1 14e 11.0 Sales, Rolling m y/y growth (RHS) EBIT, Rolling m Adj EBIT-marg (RHS), Reuters ust 28, 20 Royal Unibrew, Brewers, Denmark 3

4 Q2 review Revenue was the positive surprise in the second quarter, while earnings in the Western Europe were weaker than forecasts. As expected, favourable weather conditions in Q3 led management to narrow guidance to the upper end of the otherwise reiterated ranges. However, the recently completed Hartwall acquisition stole most of the spotlight in connection with the results announcement. Strong sales in the quarter Management still sees Italy as uncertain Favourable weather in Q3 Aiming for the upper end of guidance Royal Unibrew s Q2 20 results came in better than expected when looking at revenue that was 5% better than our forecast and 7% better than consensus, with all three divisions driving the positive deviation. EBIT was close to expectations, however, with better-thanexpected profitability in Malt Beverages being outweighed by a lower-than-forecast EBIT margin in Western Europe. Italy was a positive surprise in Western Europe, with flat sales compared to Q2 20 where we had expected a 4% decline. However, management noted that sales have been supported by some stocking at distributor level, and still sees a relatively uncertain situation in Italy. In Denmark, sales have been driven forward by Carlsberg s dispute with the COOP retailer, which should be seen as a non-recurring opportunity to boost sales, although at rather low margins. Management reiterated guidance for the existing business (i.e. excluding Hartwall), though noting that it expects to end in the high end of guidance ranges, on the back of favourable weather in Q3. This was in line with our expectations ahead of the results. Table 1: Q2 20 deviation table Royal Unibrew DKKm Q1 Q2 Q3 Q4 Q1 Q2a Q2 Q2e Q2e Q2e ACT HCM DEV CONS DEV Net revenue , % 970 7% EBITDA % n.a. n.a. Depreciations etc % n.a. n.a. Operating profit % 159 3% Special items n.m. 0 n.a. EBIT % 159 3% Associates % n.a. n.a. Net financials % n.a. n.a. Pre-tax profit % 163 4% Tax % n.a. n.a. Profit after tax % n.a. n.a. Minorities n.a. n.a. n.a. Net profit % 2 17% Net revenue , % 970 7% - Western Europe % 685 7% - North East Europe % % - Malt Beverages % 105-1% Revenue growth 1% -1% 1% -1% 0% 6% 1% 5.5%p -1% 7.3%p - Western Europe 7% -4% 0% 2% -1% 6% 1% 5.1%p -1% 6.8%p - North East Europe -28% -2% -2% 6% 15% 17% 9% 8.0%p 2% 14.9%p - Malt Beverages 25% 15% % -23% -11% -9% -14% 5.0%p -9% -0.5%p EBIT % 159 3% - Western Europe % 8-5% - North East Europe % 19 27% - Malt Beverages % 20 25% - Unallocated % -9 14% EBIT margin 7.5% 16.3% 19.7% 11.2% 8.2% 15.7% 16.7% -1.0%p 16.4% -0.7%p - Western Europe 8.5% 18.8% 22.2% 16.1% 10.1% 16.6% 19.1% -2.5%p 18.7% -2.1%p - North East Europe 0.3% 10.3% 8.6% -4.3% -1.1%.1%.4% -0.3%p 10.9% 1.2%p - Malt Beverages 17.0% 19.0% 25.4% 18.2% 20.0% 24.4% 19.0% 5.4%p 19.5% 4.9%p Source: Royal Unibrew & Handelsbanken Capital Markets 4 Royal Unibrew, Brewers, Denmark ust 28, 20

5 Estimate changes We make only few changes to our estimates for pre-hartwall Royal Unibrew, while the consolidation of Hartwall from ust 23, 20 leads us to lift FY 20e group revenue by 23% while net profit is lifted by 2%. Estimate changes for FY 2014e are insignificant. Including Hartwall from ust 23 Hartwall main driver behind estimate changes Ahead of the results, we had included Hartwall from January 1, 2014; but with the company now providing further information we include Hartwall in our estimates from the official closing date on ust 23, 20. The inclusion of Hartwall lifts our 20e revenue, EBITDA and EBIT forecasts by DKK 758m, DKK 88m and DKK 23m, respectively. For the existing part of Royal Unibrew, our estimate changes are not material. For 2014e, we have cut our EBIT estimate by 3%, on the back of slightly lower assumptions for Northeastern Europe. Table 2: Estimate changes Royal Unibrew e 20e 20e 2014e 2014e 2014e DKKm FY FY FY FY FY FYe FYe FYe FYe FYe FYe NEW OLD CHG NEW OLD CHG An interest rate of 3% on the Hartwallrelated debt makes us lower our financial costs in 2014e Net revenue 4,179 3,816 3,775 3,431 3,430 4,256 3,449 23% 5,923 5,920 0% EBITDA % 1,007 1,040-3% Depreciations etc % % Operating profit % % Special items % % EBIT % % Associates % % Net financials % % Pre-tax profit % % Tax % % Profit after tax % % Minorities % % Net profit % % Net revenue 4,179 3,816 3,775 3,431 3,430 4,256 3,449 23% 5,923 5,920 0% - Western Europe 2,537 2,418 2,425 2,410 2,430 2,473 2,445 1% 2,480 2,452 1% - Northeastern Europe 1, , % 3,020 3,063-1% - Malt Beverages % % Revenue growth 8% -9% -1% -9% 0% 24% 1% 24%p 39% 72% -32%p - Western Europe 2% -5% 0% -1% 1% 2% 1% 1%p 0% 0% 0%p - Northeastern Europe 24% -19% 4% -33% -7% 140% 10% n.m. 115% 377% n.m. - Malt Beverages 6% -5% -16% -4% 6% -9% -% 4%p % % 0%p EBIT % % - Western Europe % % - Northeastern Europe % % - Malt Beverages % % - Unallocated % % EBIT margin 3.2% 6.4% 11.0%.8% 14.1%.2% 14.5% -2.4%p.0%.4% -0.3%p - Western Europe 7.5% 11.4% 15.1% 16.8% 16.8% 16.6% 17.1% -0.5%p 17.3% 17.6% -0.3%p - Northeastern Europe -4.5% -0.6% 4.9% 7.2% 4.7% 4.9% 7.0% -2.1%p 8.5% 9.1% -0.6%p - Malt Beverages 7.4% 7.7% 11.8%.6% 20.2% 21.7% 20.2% 1.5%p 20.2% 20.2% 0.0%p Source: Royal Unibrew & Handelsbanken Capital Markets Table 3: HCM estimates versus guidance, FY 20 The company has excellent transparency when delivering guidance in late ust DKK m HCM old company Guidance old company Source: Royal Unibrew & Handelsbanken Capital Markets HCM Hartwall Guidance Hartwall HCM group Guidance group Sales 3,499 3,325-3, ,256 4,065-4,225 EBITDA EBIT ust 28, 20 Royal Unibrew, Brewers, Denmark 5

6 Dividend story in the making Prior to announcing the Hartwall deal, Royal Unibrew was widely perceived as a dividend case, something that has been put temporarily on hold. However, we see a significant potential to reassume the position, expecting an annual yield of 10-% from 2015e, as a combination of dividends and share buybacks. Lifting our buyback assumptions Royal Unibrew used the Q2 20 results to underline that it is most definitely planning to reinstall the payment of excess cash to investors, once part of the debt related to the Hartwall acquisition has been paid back. The company aims to have an ordinary dividend payout ratio of 40-60% again as soon as from 2015, i.e. for the 2014 financial year. We expect annual buybacks of DKK 400m from 2015e Hartwall deal made it possible to optimise the capital structure Share buybacks will be used if they are found appropriate as a measure to optimise the company s capital structure; these conditions are expected to be met in We previously included annual buybacks of DKK 300m from 2015e, which we are now lifting to DKK 400m, as this assumption should still leave room for a gradually declining netinterest-bearing-debt-to-ebitda ratio. Royal Unibrew aims to keep the ratio below 2.5x, but we believe the company will be more comfortable with a ratio close to 2.0x than 2.5x. Our updated assumptions mean that we are now expecting an annual payout yield of 10- % in the years from 2015, a level that is higher than what was expected before Royal Unibrew announced the Hartwall deal. As we see it, this illustrates an important effect from the Hartwall deal: enabling Royal Unibrew to reach a more optimal capital structure, something that was otherwise difficult to obtain, given the covenant of having an equity ratio of at least 30%. Table 4: Dividend and buyback assumptions 20 20e 2014e 2015e 2016e 2017e Total DPS Adj number of shares - end of period, m Total dividend payment, DKK m Total buy-back assumption, DKK m Average share price, DKK n.m Numbers of shares bought, m Total cash distribution, DKK m Adj number of shares - end of period, m Total cash distribution per share, DKK Yield of 10-% from 2015e Share price Yield 8.9% 0.6% 3.6% 10.5% 11.4%.5% Net interest bearing debt, DKK m 321 2,884 2,284 2,316 2,340 2,341 EBITDA ,007 1,061 1,116 1,168 NIBD/EBITDA 0.5x 4.1x 2.3x 2.2x 2.1x 2.0x 6 Royal Unibrew, Brewers, Denmark ust 28, 20

7 Valuation charts Current vs. high/low/median, 10 years P/BV EV/Sales EV/EBITDA EV/EBIT P/E x P/E OTC/nm EV/EBITDA EV/EBIT x x EV/EBITDA EV/EBIT P/BV and ROE EV/Sales and EBIT margin x 4.0 % x % ROE (RHS) P/BV EBIT-margin (RHS) EV/Sales 3 FCFE yield Dividend (ordinary) and bond yield (10-year) % % FCFE-yield Negative values Dividend yield No dividend Bond yield and company fundamentals ust 28, 20 Royal Unibrew, Brewers, Denmark 7

8 Technical indicators, six months Share price and moving averages DKK Feb Mar Apr May Jun Jul Royal Unibrew MAV 20d MAV 200d Volume Volume 36,000 27,000 18,000 9,000 0 Feb Mar Apr May Jun Jul Bollinger bands DKK Feb Mar Apr May Jun Jul +(-)2 STDEV MAV 20D Royal Unibrew Relative strength index (RSI) RSI Feb Mar Apr May Jun Jul Volume-weighted change (VWC) % Feb Mar Apr May Jun Jul Volume Weighted Change Royal Unibrew (RHS) DKK Source: Reuters Note: RSI compares the magnitude of recent share price gains with the magnitude of recent share price losses. Rule-of-thumb: RSI>70 => overbought. RSI<30 oversold. VWC is the volume weighted relation between [close-open] and [high-low] and indicates the momentum of the price change. 8 Royal Unibrew, Brewers, Denmark ust 28, 20

9 Momentum -month share price vs. recommendation DKK BUY ACC -month share price vs. target price DKK RED SELL Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Royal Unibrew HCM Consensus median 410 Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Royal Unibrew HCM Consensus median Sales estimate revisions, 20 Sales estimate revisions, 2014 DKKm 4,300 DKKm 4,100 5,700 3,900 5,100 3,700 4,500 3,500 3,900 3,300 Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul 3,300 Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul HCM Consensus median estimate HCM Consensus median estimate Adjusted EPS estimate revisions, 20 Adjusted EPS estimate revisions, 2014 DKK 40.0 DKK Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul 39.0 Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul HCM Consensus median estimate HCM Consensus median estimate & Reuters Opportunities Danish beer market bounces back Improved product mix Italian beer consumption increases Malt beverages growth in Africa & Reuters Risks Price wars Higher raw material costs Continued rapid decline in European beer consumption Consumers turning their back to on-trade & Reuters ust 28, 20 Royal Unibrew, Brewers, Denmark 9

10 Valuation data DKK e 2014e 2015e Share price year-end/current Share price high Share price low Market cap (DKKm) 468 1,555 3,679 3,435 5,0 6,896 6,896 6,496 Net debt (DKKm) 2,144 1, ,884 2,284 2,316 MV associates (DKKm) MV minorities (DKKm) EV (DKKm) 2,538 2,829 4,259 3,849 5,256 9,6 8,971 8,557 P/E reported (x) n.m P/E adj (x) n.m P/CEPS (x) n.m P/BV (x) ROE adj (%) Pre-tax ROIC (%) EV/sales (x) EV/EBITDA (x) EV/EBIT (x) EBIT adj margin (%) EBITDA adj margin (%) FCF adj yield (%) Tot Div yield (%) Payout ratio (%) Royal Unibrew, Brewers, Denmark ust 28, 20

11 DCF model assumptions DKKm 20 20e 2014e 2015e 2016e 2017e 2022e 2027e 2032e Sales 3,430 4,256 5,923 6,072 6,230 6,389 7,0 7,640 8,333 EBITDA ,007 1,061 1,116 1,168 1,211 1,254 1,337 EBITA ,036 % 20 20e 2014e 2015e 2016e 2017e 2022e 2027e 2032e Sales CAGR, % EBITDA growth EBITA growth EBITDA margin EBITA margin Capex/sales Capex/depreciation (x) Net working cap/sales WACC assumptions, % Calculation of DCF, DKKm DCF checkpoints, % Risk-free interest rate 2.9 NPV FCFF 6,796 5y hist sales growth -2.4 Equity market risk premium 5.5 ND inc off-bs & Hybrids 373 5y exp sales growth.2 Extra risk premium 1.0 Mkt value Preferred stock - Sustainable growth 3.0 Equity beta (x) 1.10 Mkt value Associates 168 Sust EBITDA margin 16.0 Implicit asset beta 1.0 Mkt value Minorities 1 Sust EBITA margin.4 Cost of equity 10.0 Surplus values - Sust after-tax ROIC 17.0 Pre-tax cost of debt 5.0 Other adjustments 198 Terminal value/dcf 46 Equity weight 75.0 DCF Value 6,788 Implicit equity weight 95 WACC 8.4 DCF/share (DKK) 610 Share price potential -2 ust 28, 20 Royal Unibrew, Brewers, Denmark 11

12 P&L accounts quarterly data DKKm Q2 Q3 Q4 Q1 Q2 Q3 e Q4 e Q1 14e Sales ,042 1,218 1,245 - Total op expenses ,022-1,010 - EBITDA Depreciation & impairment EBITA Goodwill amort & writedown EBIT Net financials Associated income EBT Reported tax tax rate (%) Minorities Net income Growth % - Sales Total expenses n.m EBITDA EBIT EBT Net income % of sales EBITDA margin EBIT margin EBT margin Net margin Adjusted values DKKm Total adjustments to net inc EBITDA margin (%) EBITA margin (%) EBIT margin (%) EBT Net income Revenue, -month rolling EBIT, -month rolling DKKm % DKKm % 4, , , , Q2 Q3 Q4 Q1 Q2 Q3 e Q4 e Q1 14e Q2 Q3 Q4 Q1 Q2 Q3 e Q4 e Q1 14e 11.0 Sales, Rolling m y/y growth (RHS) EBIT, Rolling m Adj EBIT-marg (RHS), Reuters Royal Unibrew, Brewers, Denmark ust 28, 20

13 Business areas quarterly data Sales - DKKm Q2 Q3 Q4 Q1 Q2 Q3 e Q4 e Q1 14e Western Europe Northeastern Europe Malt Beverages Total ,042 1,218 1,245 - Y-o-y sales growth % Western Europe Northeastern Europe Malt Beverages Total EBIT - DKKm Western Europe Northeastern Europe Malt Beverages Total EBIT margin % Western Europe Northeastern Europe Malt Beverages Total ust 28, 20 Royal Unibrew, Brewers, Denmark

14 P&L accounts annual data DKKm e 2014e 2015e Sales 4,179 3,816 3,775 3,431 3,430 4,256 5,923 6,072 Total op expenses -3,868-3,371-3,174-2,830-2,819-3,548-4,915-5,011 EBITDA ,007 1,061 Depreciation & impairment EBITA Goodwill amort & writedown EBIT Net interest expenses Net financials Associated income EBT Paid tax Reported tax tax rate (%) Minorities Net income Growth % e 2014e 2015e Sales Total expenses EBITDA EBIT EBT n.m n.m Net income n.m n.m % of sales e 2014e 2015e EBITDA margin EBIT margin EBT margin Net margin Profitability % e 2014e 2015e ROE reported ROE adj ROCE Pre-tax ROIC After tax ROIC Sales/capital invested Sales/total assets Adjusted values DKKm e 2014e 2015e Total adjustments to net inc EBITDA ,007 1,061 margin (%) EBITA margin (%) EBIT margin (%) EBT Net income Royal Unibrew, Brewers, Denmark ust 28, 20

15 Business areas annual data Sales - DKKm e 2014e 2015e Western Europe 2,537 2,418 2,425 2,410 2,430 2,473 2,480 2,504 Northeastern Europe 1, ,406 3,020 3,094 Malt Beverages Total 4,179 3,816 3,775 3,431 3,430 4,256 5,923 6,072 Sales growth % Western Europe Northeastern Europe Malt Beverages Total EBIT - DKKm Western Europe Northeastern Europe Malt Beverages Total EBIT margin % Western Europe Northeastern Europe Malt Beverages Total Forecast balance sheet DKKm e 2014e 2015e Accounts receivable Inventory Other current assets Cash other interest-bearing , Current assets 1, ,146 2,028 2,022 Goodwill ,734 2,704 2,674 Other intangible Tangible assets 2,079 2,014 1,772 1,601 1,479 2,219 2,161 2,109 Shares associates Other financial assets Total assets 4,051 3,490 3,057 2,890 2,848 6,405 7,243 7,201 Equity ,269 1,308 1,348 2,078 2,581 2,508 Minorities Shareholders equity ,281 1,321 1,348 2,079 2,583 2,511 Deferred tax liabilities LT interest-bearing debt 1,704 1, ,252 3,252 3,252 ST interest-bearing debt Provisions Trade payables Oth current liabilities Current liabilities 1, ,254 1,284 Total equity & liabilities 4,051 3,490 3,057 2,890 2,848 6,405 7,243 7,201 Net interest bearing debt 2,144 1, ,884 2,284 2,316 ust 28, 20 Royal Unibrew, Brewers, Denmark 15

16 Forecast cash flow DKKm e 2014e 2015e EBITA Net financials Paid Tax Dividends from associates Chg in NWC Depreciation/Impairment Other adjustment Cash flow from operations (CFFO) Net recurring capex FCF bef Acq. & Div. (FCF) Acquisitions , Divestments FCF to Equity (FCFE) , Paid dividends to share holders Share buy-backs New share issue Other adjustments NET Cash flow/chg in NIBD , Funds from operations (FFO) Cash flow from operations (CFFO) FCF bef Acquisitions & Divestments FCF to Equity (FCFE) , Financial ratios % e 2014e 2015e Equity/total assets Net debt/equity Net debt/ebitda (x) Net cash flow/capex -115 >500 > >500 < EBITDA net interest cover (x) EBIT net interest cover (x) FCFF/total debt Total debt/capital Short-term debt/capital Long-term debt/capital Inventory/sales Receivable/sales Acc.payable/sales Working capital/sales Current ratio Quick ratio Royal Unibrew, Brewers, Denmark ust 28, 20

17 Per share data DKK e 2014e 2015e No of shares, year-end (m) No of shares, average (m) EPS reported Y-o-y growth (%) n.m n.m EPS adj Y-o-y growth (%) n.m n.m Cash earnings DPS - ordinary Payout ratio (%) DPS - EO Payout ratio (%) Buy-backs Buy-backs, no shares (m) Buy-back payout ratio (%) Tot cash payout ratio (%) Book value Y-o-y growth (%) Net debt NAV ust 28, 20 Royal Unibrew, Brewers, Denmark 17

18 Disclosures Recommendation Structure, Definitions and Allocations Handelsbanken Capital Markets Equity Research (HCM) employs a four-graded recommendation scale. The recommendations reflect the analyst s assessment of how much the share price may appreciate or depreciate in absolute terms in a -month time horizon and takes into account risks related to both fundamental expectations and share performance. Investment ratings are determined by the ranges described in the table below. The recommendations do not represent the analyst s or the bank s assessment of the company s fundamental value or quality. All investments involve risks and investors are encouraged to make their own decision as to the appropriateness of an investment in any securities referred to in this report, based on their specific investment objectives, financial status and risk tolerance. The recommendations and absolute performance intervals, together with the allocation of the rating categories amongst companies under coverage and amongst companies under coverage for which Handelsbanken has provided investment banking services in the past months are listed below: Ratings: definitions and allocations HCM rating R TP is expected to be 1 HCM Universe 2 IB services 3 Buy >+20% 21% 8% Accumulate +5% - +20% 50% 5% Reduce -15% - +5 % 28% 3% Sell < -15 % 1% 0% 1 R TP is defined as the expected share price appreciation (depreciation) including dividends over the next months 2 Percentage of companies under coverage within each rating category 3 Percentage of companies within each rating category for which investment banking services have been provided in the past months, as per 28/8 20 Reiterated Accumulate DKK 620 At times, the expected total returns may fall outside of the above stated ranges because of price movement and/or volatility. 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19 Company overview P&L DKK e 2014e 2015e Sales, bn growth (%) n.m EBITDA, bn margin % EBITA, m margin % EBIT, m margin % Net income, m growth % n.m n.m n.m Adj net income, m Balance sheet e 2014e 2015e Tangible assets, bn Goodwill, bn Current assets, bn Cash, bn Total assets, bn Equity, bn Minority, m LT int bearing debt, b ST int bearing debt, m Current liab, bn Total liabilities, bn Net int bearing debt, b Cash flow e 2014e 2015e Capex, m FCF to firm, m FCF to equity, bn Acquisitions, bn Divestments, m Dividends, m CFFO, m Ratios (%) e 2014e 2015e Pre-tax ROIC ROE reported n.m ROCE n.m Capex to sales NWC to sales Sales/assets (x) Sales/IC (x) n.m Net debt/equity Equity/total assets Share data e 2014e 2015e Avg no shares (m) change (%) n.m Bought back shares ( Avg diluted shares (m change (%) n.m Share price YE (DKK) Market cap (DKK), bn EV (DKK), bn Net debt/share EPS reported growth (%) n.m n.m n.m EPS adj growth (%) n.m n.m n.m BVPS DPS - Ordinary DPS - Extraordinary Value buy-back/share Total cash distr./share Valuation (x) e 2014e 2015e P/E reported n.m P/E adjusted n.m P/CEPS n.m EV/EBITDA EV/sales EBIT margin (%) P/sales P/BV ROE reported (%) n.m FCF adj yield (%) Tot Div yield (%) Calendar EGM Sep 26, 20 (09:00) Q3 report Nov 21, 20 (08:00) Management CEO: Henrik Brandt CFO: Lars Jensen IR: Ginette Maasbøl Phone number: Company profile Royal Unibrew is the second-largest brewery in Denmark. Exposure outside Denmark includes Latvia, Lithuania, the Danish/German border trade and an Italian export business Svenska Handelsbanken AB (publ) Stockholm Blasieholmstorg 11 SE Stockholm Tel Fax Copenhagen Havneholmen 29 DK-1561 Copenhagen V Tel Fax Helsinki Aleksanterinkatu 11 FI Helsinki Tel Fax Oslo Tjuvholmen allé 11, Postboks 49 Vika NO-0110 Oslo Tel Fax London 3 Thomas More Square London GB-E1W-1WY Tel Fax New York Handelsbanken Markets Securities inc. 875 Third Avenue, 4 th floor New York, NY Tel Fax FINRA, SIPC