KWS Investor Presentation September 2015

Investor Presentation

KWS SAAT SE | October 2015

Business performance of the KWS Group

Plant breeding & seed business Fundamentals

Source: DBV

48%

usable harvest

Source: FAO

42% pre-

harvest losses

10% post-

harvest losses

R&D intensity of approx. 15% of consolidated net sales

1% to 2% progress in yields and

development of tolerances and resistances

Per capita cropland (in ha)

2000 1950 2050

0.5 0.3

0.2

Harvest losses (worldwide)

Climate change

October 2015 Investor Presentation 3

°C

Global importance of agricultural crops

217

177 163

107

49 38 34

25 26 19

6 5

704

883

722

261

134

54 62 40

138

374

13 38

Source: faostat.fao.org, May 2013 *Raw sugar value, source: zuckerverbaende.de, May 2013

Acreage 2012 (in mn ha)

World production 2012 (in mn tonnes)

not part of the KWS product portfolio Trend compared to previous year

Wheat

Corn

Barley

Sorghum

Rapeseed

Sunflower

Potato

Rye

Sugar-

beet

Catch

crops


TOP 6 Global agricultural seed companies Sales of agricultural crops

October 2015

Global sales in € bn

1.19 USD/EUR

1 Sales 2013/2014 „Seeds & Genomics“ w/o vegetables; FY: September 1 to August 31 2 Sales 2014, „Seeds“; FY: January 1 to December 31 3 Sales 2014 w/o flowers & vegetables; FY: January 1 to December 31 4 Sales 2014/2015; FY: July 1 to June 30 5 Sales 2014; „Seeds, Traits & Oils“; FY: January 1 to December 31 6 Sales 2014/2015; „Field seeds“; FY: July 1 to June 30

Sales* in Europe in € bn

1.19 USD/EUR

DuPont/Pioneer

Syngenta

Vilmorin

Dow

Monsanto

* Estimated sales for calendar year 2014 * Source: Phillips McDougall Consultants; own estimates KWS

Investor Presentation 5

At the beginning of fiscal year 2014/2015 we changed the presentation of the KWS Group’s consolidated financial statements due to an amendment to the International Financial

Reporting Standards (IFRS 11). We can no longer carry the net sales and costs of our 50:50 joint ventures in the statement of comprehensive income in the KWS Group. If not stated

otherwise, all figures in the following will be in accordance with our internal corporate controlling structure.

Monsanto1

DuPont/Pioneer2

Syngenta3

Dow5

Vilmorin6

4

0.9

1.3

1.3

3.2

6.1

8.3

0.1

0.6

0.6

0.7

0.7

1.0

KWS core framework


Ziele

Profitable growth An average increase in consolidated net sales of 5% to 10% p. a.

EBIT margin > 10%

Research & development R&D intensity of 12% to 15% of consolidated sales

1% to 2% progress in yields p. a. for our customers and development of tolerances and resistances

Internationalization Foreign sales > 80%

Expansion of the portfolio of varieties for subtropical markets

Sustainability Integration of international subsidiaries

Dividend A dividend payout ratio of 20% to 25% of the KWS Group’s net

income for the year

The KWS Group’s medium- and long-term objectives

KWS seeds the future.

Our high-performing seeds and thorough knowledge of

agriculture make us the trusted supplier for generations

of farmers. This is our contribution in addressing

growing global food demand.

117 141 152

138 138

10/11 11/12 12/13 13/14 14/15

CAGR

4.2% 855

986

1,147 1,178 1,260

10/11 11/12 12/13 13/14 14/15

CAGR

10.2%

EBIT in € mn

EBIT margin 2014/2015: 10.9%

Sales in € mn

in € mn 2014/2015 2013/2014

Sales 986.0 923.5

EBIT 113.4 118.3

KWS Track Record

Sales and EBIT in accordance with IFRS 11 (at equity)


Sales 2014/2015

Sales in € mn

714.9

351.1

107.3

4.7

1,178.0

754.4

390.5

111.3

4.2

1,260.4

Corn Sugarbeet* Cereals KWS Group Corporate

* incl. potato

Sales 2013/2014 Sales 2014/2015


Total sales by region and business segment 2014/2015

October 2015

* incl. potato


By business segment

60% Corn

31%

Sugarbeet*

Cereals 9%

Total sales

€ 1,260.4 mn

By region

Germany 18%

41% Americas

36% Europe (w/o Germany)

Rest of world 5%

Total sales

€ 1,260.4 mn

EBIT 2014/2015


EBIT in € mn

100.9

70.1

17.1

–49.7

138.4

84.2

93.0

12.0

–51.2

138.0

EBIT 2013/2014 EBIT 2014/2015

* incl. potato

Corn Sugarbeet* Cereals KWS Group

Corporate

Major EBIT drivers


Major EBIT drivers in € mn

47.3

4.4

–25.2

–19.0 –2.9 138.4 138.0

EBIT 2013/2014 Gross margin Seling expenses R&D expenses Administrativeexpenses

OOI/OOE balance EBIT 2014/2015

* incl. potato


Statement of comprehensive income

in € mn, if not stated otherwise 2014/2015 2013/2014 +/–

Net sales 1,260.4 1,178.0 +7.0%

Cost of sales 649.6 614.5 +5.7%

Gross profit on sales 610.8 563.5 +8.4%

Selling expenses 236.7 212.3 +11.5%

Research & development expenses 173.8 150.0 +15.9%

General and administrative expenses 80.5 76.7 +5.0%

Other operating income 89.8 60.7 +47.9%

Other operating expenses 71.6 46.8 +53.0%

Operating income (EBIT) 138.0 138.4 –0.3%

Net financial income/expenses –7.1 –12.6 –43.7%

Results of ordinary activities 130.9 125.9 +4.0%

Taxes 46.9 45.6 +2.9%

Net income for the year 84.1 80.3 +4.6%

Share of minority interests 1.3 3.2 –59.4%

Net income after shares of minority interests 82.7 77.1 +7.3%

Earnings per share (in €) 12.54 11.69 +6.8%

In accordance with our corporate controlling structure


Statement of comprehensive income Reconciliation: corporate controlling structure/IFRS 11

in € mn, if not stated otherwise

Corporate

controlling structure +/–

IFRS 11

(at equity)

Net sales 1,260.4 –274.4 986.0

Cost of sales 649.6 –196.1 453.5

Gross profit on sales 610.8 –78.3 532.5

Selling expenses 236.7 –47.7 189.0

Research & development expenses 173.8 +0.8 174.6

General and administrative expenses 80.5 –5.7 74.8

Other operating income 89.8 –1.8 88.0

Other operating expenses 71.6 –2.9 68.7

Operating income (EBIT) 138.0 –24.6 113.4

Net financial income/expenses –7.1 +23.8 16.7

Results of ordinary activities 130.9 –0.8 130.1

Taxes 46.9 –0.8 46.1

Net income for the year 84.1 –0.1 84.0

Share of minority interests 1.3 +/–0 1.3

Net income after shares of minority interests 82.7 +/–0 82.7

Earnings per share (in €) 12.54 –0.01 12.53

Reconciliation 2014/2015


Balance sheet - assets at June 30, 2015

in € mn 2014/2015 2013/2014

Intangible assets 85.7 73.9

Property, plant and equipment 351.9 283.9

Equity-accounted financial assets 153.0 126.1

Financial assets 2.5 2.7

Noncurrent tax assets 4.0 4.2

Deferred tax assets 54.3 47.8

Noncurrent assets 651.4 538.7

Inventories 178.0 120.2

Biological assets 12.3 12.6

Trade receivables 309.7 297.8

Securities 67.0 69.2

Cash and cash equivalents 41.2 53.1

Current tax assets 57.5 45.3

Other current financial assets 26.7 14.9

Other current assets 11.7 13.3

Current assets 704.1 626.3

Total assets 1,355.5 1,165.0

In accordance with IFRS 11 (at equity)


Balance sheet – equity and liabilities at June 30, 2015

in € mn 2014/2015 2013/2014

Subscribed capital 19.8 19.8

Capital reserve 5.5 5.5

Retained earnings 705.7 604.4

Minority interest 7.7 8.1

Equity 738.7 637.8

Long-term provisions 110.6 99.0

Long-term borrowings 181.8 113.8

Trade payables 1.6 1.5

Deferred tax liabilities 28.1 26.2

Other noncurrent liabilities 12.8 12.5

Noncurrent liabilities 334.9 253.0

Short-term provisions 87.4 74.8

Short-term borrowings 32.3 40.1

Trade payables 59.7 56.8

Current tax liabilities 30.1 35.4

Other current financial liabilities 15.9 11.6

Other current liabilities 56.5 55.4

Current liabilities 281.9 274.2

Liabilities 616.8 527.2

Total equity and liabilities 1,355.5 1,165.0



Taxes

in € mn 2014/2015 2013/2014 +/–

Results of ordinary activities 130.1 125.8 +3.5%

Expected income tax expense 37.9 36.6 +3.5%

Difference in income tax liability outside Germany 4.2 13.6 –68.8%

Tax portion for tax-free income –3.0 0.1

Tax portion for expenses not deductible for tax purposes 6.7 2.6

Tax portion for temporary differences and losses for which no deferred taxes have

been recognized

0.0 0.1

Tax credits –0.3 0.0

Taxes relating to previous years 0.3 –6.8

Other tax effects 0.3 –0.7

Reported income tax expense 46.1 45.5 +1.3%

Effective tax rate 35.4% 36.2% –2.1%

Reasons for the increase in tax rate:

strong income growth in countries with higher tax rates

special effects amongst others due to the merger of KWS MAIS GMBH with

KWS SAAT SE



Cash flow statement

in € mn 2014/2015 2013/2014 +/–

Net income for the year 84.0 80.3 +4.6%

Cash earnings 92.1 85.0 +8.4%

Net cash from operating activities 48.1 76.1 –36.8%

Net cash from investing activities –123.8 63.1

Net cash from financing activities 48.4 –43.6

Cash and cash equivalents at end of year 108.2 122.3 –11.5%

Thereof cash and cash equivalents 67.0 69.2 –3.2%

Thereof securities 41.2 53.1 –22.4%

Changes in cash and cash equivalents –14.1 –33.5 –57.9%

Oktober 2015


Capital expenditure 2014/2015 Strengthening of growth markets

October 2015

* incl. potato


By region

Germany 24%

Americas

25%

43% Europe

(w/o Germany)

Rest of world 8%

Capital expenditure

€ 140.6 mn

By business segment

37% Corn 17%

Sugarbeet*

32% Cereals

Corporate 14%

Capital expenditure

€ 140.6 mn

Segment report

Corn Segment

Corn acreage for sowing season 2015


0.8 1.6 2.1 2.6 3.0 3.7

4.9

7.8

15.5

36.0 37.8

NorthernEurope

CentralEurope

SouthernEurope

Germany France Argentinia South EastEurope

EasternEurope

Brazil NorthAmerica

China

Market volume 2014/2015* (in mn ha)

EU 28: 13.6 mn ha (–3%)

Europa (excl. CH, incl. TR, UA, RU): 22.4 mn ha (–4%)

NE: DK, UK, NL, BE; SOE: HU, BG, AT, RO, RS, HR; NA: US; ME: PL, CZ, SK; SE: IT, ES, PT; OE: RU, UA

* Priliminary data Source: Kleffmann; KWS; USDA; Statistical Office of China; Brazilian Department of Agriculture

Corn EU Sales development and market share


259

297 314 324 321

10/11 11/12 12/13 13/14 14/15

Syngenta 6%

Net sales* in € mn

CAGR

5.5%

Market share* 2014/2015

19% KWS

Vilmorin 14%

Others 24%

22% Pioneer

15% Monsanto

EU acreage

13.6 mn ha

* Preliminary data; Source: Kleffmann; own estimates KWS * Including sales with oilseeds & catch crops

Corn North America Sales development and market share


50:50-JV with Vilmorin, France

358

451

537 509

556

10/11 11/12 12/13 13/14 14/15

CAGR

11.6%

Syngenta 5%

*Preliminary data, KWS

7% AgReliant

Dow 5%

Others 16%

33% Pioneer

Monsanto 34%

US acreage

36.0 mn ha


Market share* 2014/2015

* Including sales with oilseeds & catch crops

Corn other regions Sales development


39 50

123 145 155

10/11 11/12 12/13 13/14 14/15

CAGR

41.2%

53% South Americas

30% European

non EU states

Asia/Africa 17%

Sales

€ 155 mn


Sales breakdown 2014/2015

* Including sales with oilseeds & catch crops

Sugarbeet Segment

Sugarbeet segment sales

October 2015

Total segment sales

Potato 9%

91% Sugarbeet

Segment sales

2014/2015

€390.5 mn


Sugarbeet worldwide Sales development and market share


1 Sugarbeet seeds w/o potato

Net sales1 in € mn

267 281

298 319

364

10/11 11/12 12/13 13/14 14/15

CAGR

8.1%

Global acreage: 4.0 mn ha (–4%)

26% KWS

17% SESVanderHave

16% Betaseed

Strube 11%

Desprez 5%

Crystal 12%

2% Others

Market share1,2

2014/2015

Syngenta 8%

2 Own data KWS, 2015


Maribo 3%

Sugarbeet EU Sales development and market share

October 2015

2 Own data KWS, 2014



132 129 128 137 136

10/11 11/12 12/13 13/14 14/15

CAGR

0.8%

Net sales1 in € mn

EU-acreage 2015: 1.4 mn ha (–14%)

20% SESVanderHave

Maribo 4%

Strube 18%

Syngenta 6%

Desprez 4%

Betaseed 5%

2% Others

Market share1,2

2014/2015

41% KWS


EU sugar market regime 2017


Acreage expected to stay stable

Slight acreage expansion in competitive countries

Slight acreage reduction due to step-wise increase of isoglucose production

Higher sugar price volatility leads to higher acreage fluctuation

EU border protection is obtained

What lies ahead? – New research & breeding projects: New breeding technologies (GABI)

KWS & Bayer CONVISO® SMART (non-GMO herbicide resistance)

KWS & BASF Yield genes (GMO)

Rizomania resistance (GMO virus resistance)

…

Important sugarbeet research projects at KWS

October 2015

KWS will remain no. 1 in innovations


Cereals Segment

KWS cereals activities

October 2015

Acreage-related decline in hybrid rye business


78 93

112 107 111

10/11 11/12 12/13 13/14 14/15

CAGR

9.2%

Net sales in € mn

Wheat 21%

Barley 20%

Others 6%

Rapeseed 10%

Net sales breakdown by product group

43% Rye

Segment sales

2014/2015

€ 111.3 mn

KWS cereals activities

October 2015

Takeover of the remaining 51% of shares in MOMONT, France


Research & Development

Research & development at KWS Base of a successful Corporate Development


R&D expenditure in € mn

114

127

140 150

174

0

50

100

150

200

10/11 11/12 12/13 13/14 14/15

CAGR

11.2%

13.3% 12.9% 12.2% 12.7% 13.8%

10/11 11/12 12/13 13/14 14/15

R&D intensity

Research & development at KWS Highly innovative and tailor-made


296 303 276

336

429

10/11 11/12 12/13 13/14 14/15

1,446

1,460

1,582 1,768

1,836

10/11 11/12 12/13 13/14 14/15

R&D employees Marketing approvals for new varieties

KWS: Global breeding


Breeding and distribution in over 70 countries

Breeding stations

Trial locations

Genetically engineered trait Lead gene

identification

Proof of

concept

Elite Event

selection

Deregulation

Commerciali-

zation

Glyphosate tolerance

Virus resistance

Yield genes



+ Insect resistance

Drought tolerance

Nitrogen use efficiency

Fungal resistance

Fungal resistance

KWS trait pipeline Progress by project


Corn traits from different companies


Trait Event Event name Monsanto Syngenta DuPont/Pioneer DOW

Subterranean

insect pests

MON88017 YieldGard VT

Rootworm D X

MIR604 Agrisure RW D X

5307 Agrisure Duracade D

59122 Hercules RW,

AcerMax RW X X D D

MON87411 RNAi+Cry3Bb1 D X

Aerial insect

pests

MON810 YieldGard D X

Bt11 Agrisure TL,

Agrisure CB/LL D

TC1507 Herculex I,

Herculex CB X D D

MON89034 YieldGard VT

(Double) Pro D X X

MIR162 Agrisure Viptera X D X

Herbicide

tolerance

GA21 Agrisure GT D

NK603 Roundup Ready 2 D X X

T25 Liberty Link X X X X

DAS-4Ø278-9 Enlist X D

D = Developer (2 „Ds“ in one row = joint development) X= Licensee

Employees


2014/2015 2013/2014 +/–

Research & development 1,985 1,836 8.1%

Distribution 1,259 1,241 1.5%

Production 1,408 1,136 23.9%

Administration 670 634 5.7%

Total 5,322 4,847 9.8%

Employees by function*

35% Americas

Others 4%

26% Europe

(w/o Germany)

Employees by region*

35% Germany

*On average for the year

Forecast 2014/2015 KWS Group in accordance with IFRS 11

Forecast 2015/2016


KWS Group Sales EBIT margin R&D intensity

2015/2016 1,035 – 1,085 > 10.5% ~17%

Forecast for the KWS Group in accordance with IFRS 11

Forecast 2015/2016 Segment report

Forecast 2015/2016


2015/2016 2014/2015

Sales +10% to 15% € 754.4 mn

EBIT margin around 11% 11.2%

Corn

2015/2016 2014/2015

Sales

at the level of the

previous year

€ 390.5 mn

EBIT margin

at the level of the

previous year

23.8%

Sugarbeet

2015/2016 2014/2015

Sales slight growth € 111.3 mn

EBIT margin below previous year 10.8%

Cereals

2015/2016 2014/2015

Sales stable € 4.2 mn

EBIT around –60 Mio. € € –51.2 mn

Corporate

Appendix

Principles

46

1. We optimize genetic potential through excellent research

and breeding programs.

2. We deliver best-quality seeds to our farmers.

3. We act as trusted performance partners for our farmers

throughout their value chain.

4. In order to support talents at all levels to perform, we

provide for entrepreneurial freedom.

Mission

KWS seeds the future.

Our high-performing seeds and thorough knowledge of

agriculture make us the trusted supplier for generations of

farmers. This is our contribution in addressing growing global

food demand.

Vision

October 2015 Investor Presentation

The Executive Board

October 2015

Dr. Hagen Duenbostel (1970)

CEO/Member of the

Executive Board since 2003

Responsibility: Corn, Development

& Communication, Compliance

Degree in Business Administration;

Dr. rer. pol.

Dr. Léon Broers (1960)

Member of the


Responsibility: Research, Breeding

Ph.D. in Plant Breeding;

Master of Business Administration

Dr. Peter Hofmann (1960)

Member of the


Responsibility: Sugarbeet, Cereals,

Marketing

Degree in Agronomy;

Ph.D. in Seed Physiology

Eva Kienle (1967)

Member of the


Responsibility: Finance, Law,

Procurement, Controlling, IT, HR,

Global Services, Investor Relations

Degree in Business Administration


The KWS share

October 2015

Shareholder structure

No. of shares:

6,600,000

56.0% Families

Büchting

Arend Oetker

Giesecke

15.1% Tessner Beteiligungs

GmbH

Free float 28.9%

Key figures per October 8, 2015 (Xetra)

Closing call: €301.00

Market Cap.: €1.99 bn

Free Float Market Cap.: €572 mn

52 weeks high/low: €313.55/€257.00

WKN: 707400

ISIN: DE0007074007

Symbol: KWS


Financial calendar & IR contact


Date

November 24, 2015 Report on the 1st quarter of 2015/2016

December 17, 2015 Annual Shareholders’ Meeting in Einbeck

February 25, 2016 Report on the 2nd quarter of 2015/2016

May 26, 2016 Report on the 3rd quarter of 2015/2016

October 25, 2016 Publication of 2015/2016 financial statements, annual press and analyst conference in Frankfurt

December 15, 2016 Annual Shareholders’ Meeting in Einbeck

Financial calendar

Wolf-Gebhard von der Wense Head of Investor Relations

+49 (0) 5561 311-968

[email protected]

KWS SAAT SE

Grimsehlstr. 31

37574 Einbeck

Lisa Bertram Investor Relations

+49 (0) 5561 311-14 97

[email protected]

KWS SAAT SE

Grimsehlstr. 31

37574 Einbeck

Disclaimer

October 2015

These materials are not an offer for sale of Subscription rights or Securities in the United States. Subscription rights and Securities may not be

offered or sold in the United States without registration or an exemption from registration under the U.S Securities Act of 1993, as amended.

KWS SAAT SE does not intend to register any portion of the offering in the United States or to conduct a public offering in the United States or to

conduct a public offering of Subscription rights or Securities in the United States.

This document contains certain forward-looking statements relating to the business, financial performance and results of KWS SAAT SE and/or

its subsidiaries and/or the industry in which KWS SAAT SE and its subsidiaries operate. These forward-looking statements are based on KWS’

current plans, estimates, projections and expectations. These statements are based on certain assumptions that, although reasonable at this

time, may prove to be erroneous. Prospective investors should not place undue reliance on these forward-looking statements.

If certain risks and uncertainties materialize, or if certain underlying assumptions prove incorrect, events described in this document as

anticipated, believed, estimated or expected may not occur, and KWS SAAT SE may not be able to achieve its financial targets and strategic

objectives. This presentation should not be viewed as definitive legal, tax, or other advice regarding investment. All interested investors should

seek independent third party legal, tax, and other advice.

KWS SAAT SE does not intend, and does not assume any obligations, to update industry information or forward-looking statements set forth in

this document. KWS SAAT SE assumes no responsibility or liability in regard to the completeness of the contents and the accuracy of opinions,

estimates, prognoses, calculations, or other information contained in this presentation. This presentation may contain confidential information.

Neither the presentation nor any of its contents may be reproduced or otherwise made available to third parties.


Economy & Finance

KWS Investor Presentation September 2015