1. International Macadamia Symposium
Global Conference – Brisbane, Australia
U.S. Market Profile
Dennis J. Simonis
September 2012

2. U.S. Economic Environment
Economic Measure 2008 2009 2010 2011
GDP (% chg) 2.2% -1.7% 3.8% 1.7%
For Use by Intended Recipient Only
Unemployment (%, SA) 5.8 9.3 9.6 9.2
Consumer Price Inflation (% Chg) 3.8% -0.3% 1.6% 1.7%
Retail Sales (% Chg) -1.0% -6.4% 6.6% 6.5%
Residential Permits, Total (Mil) 3.6 2.3 2.4 3.5
2
Source: Moody’s, February 2011

3. Many consumers pessimistic
For Use by Intended Recipient Only
3
Personal Financial Health versus Last Year
% of Consumers
Source: Moody’s, February 2011

4. And expect more COL increases
Improve
Pt Chg YA
(2.6)
For Use by Intended Recipient Only
(0.1)
(7.1)
4
Consumer Perceptions of Economic and Financial Health
% of Consumers
Source: Moody’s, February 2011

5. U.S. Snack Market Profile
For Use by Intended Recipient Only
5

6. Snack food industry overview
For Use by Intended Recipient Only
6
• Large industry generating $67.7 billion in FDMWC during 2010
Source: Symphony/IRI Group “State of the Snack Industry 2010”

7. Snack food industry overview
For Use by Intended Recipient Only
7
• Overall flat sales with some segments growing +5% annually
Source: Symphony/IRI Group “State of the Snack Industry 2010”

8. Snack food market drivers
For Use by Intended Recipient Only
The Health & Company
Satiation Portability
Economy Wellness Values
8

9. Consumers more health focused
71%
of consumers
For Use by Intended Recipient Only
are trying to eat
healthier
9
Source: Symphony/IRI Group “State of the Snack Industry 2010”

10. Influencing snack choices
60% of consumers
are trying to eat foods that
40% of consumers help prevent health problems
and/or manage existing health
view snacks as an
For Use by Intended Recipient Only
conditions
important part of a
healthy eating
plan throughout
24% of consumers
seek snacks that offer benefits
the day beyond basic nutrition
10
Source: Symphony/IRI Group “State of the Snack Industry 2010”

11. Snack consumer drivers
Proven attributes Emerging attributes
• Low Fat 50% •
For Use by Intended Recipient Only
Low Salt/Sodium 45%
• Low Cholesterol 47% • All Natural/Natural 39%
• Low Sugar 47% Ingredients
• High Fiber 46% • Gluten Free 37%
• Low Calorie 45%
• Whole Grains 44%
11
Important Product Attributes
Source: Symphony/IRI Group
% of Consumers “State of the Snack Industry 2010”

12. Emerging attributes potential
Organic/Natural Snacks Gluten Free Foods
For Use by Intended Recipient Only
12
Source: Symphony/IRI Group “State of the Snack Industry 2010”
Packaged Facts, “2011 Gluten Free Foods Report”

13. Healthy outpacing indulgent
Nutritional Snacks/Trail Mixes +9.8%
Yogurt +8.1% Total
Snack Nuts +7.6% Healthier
+4.4%
Snack/Granola Bars +7.4%
For Use by Intended Recipient Only
Salsa +6.7%
Prepared Pudding +13.7%
Chocolate Covered Salted Snacks +13.5%
Total
Dried Meat Snacks +10.0% Indulgent
Rfg. Appetizers/Snack Rolls +8.9% +1.2%
Chocolate Candy +4.7% 13
FDMx $ Growth
Source: Symphony/IRI Group
2011 v 2010 “State of the Snack Industry 2010”

14. Causing a share shift
For Use by Intended Recipient Only
14
Share of Dollar Sales- FDMx
2010 v 2006
Source: Symphony/IRI Group
“State of the Snack Industry 2010”

15. Satiation is an important benefit
For Use by Intended Recipient Only
15
Perception of the Role of Snacks
% of Consumers Source: Symphony/IRI Group
“State of the Snack Industry 2010”

16. Portability is also important
• Consumers are spending more time in transit
• Products that provide healthy satiation are benefitting
39%
For Use by Intended Recipient Only
of consumers
seek snacks that can
be eaten on the go
16
Source: Symphony/IRI Group
“State of the Snack Industry 2010”

17. Company Values Do Matter
• Customers that care about healthy eating
care about:
• Environmental and safe growing
practices
• Green packaging
• Clean ingredient statements
• Do you have a higher “cause”?
• Key Partnerships and Influencers
• Doing business ethically

18. Snack Nut Segment
For Use by Intended Recipient Only
18

19. Snack nut sales
Sales of nuts, 2005-15
7,000
6,500
Millions of dollars ($)
6,000
5,500
5,000
For Use by Intended Recipient Only
4,500
4,000
3,500
3,000
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
(est.) (fore.) (fore.) (fore.) (fore.) (fore.)
• Nut sales were $5B in 2010, up 46% versus 2005
• Health is the primary sales driver
• Favorable trends will drive 6% CAGR through 2015 19
Source: The Mintel Group Nuts and Dried Fruit Report, January 2011

20. Snack nut consumer
Past month snack consumption, by gender, September 2010
Percent of respondents (%)
0 10 20 30 40 50 60 70 80 90
Fresh fruit 79
84
Chips 83
82
Crackers 60
68
For Use by Intended Recipient Only
Nuts 62
64
Vegetables 56
66
Popcorn 51
59
Pretzels 41
44
Dried fruit 26 Male
30
Trail mix 26 Female
27
• Over 60% of consumers snack on nuts monthly
• Only Fresh Fruit and Chips are consumed at a higher rate
20
Source: The Mintel Group Nut and Dried Fruit Report, January 2011

21. Snack nut consumer
For Use by Intended Recipient Only
• Consumers view nuts as a good source of energy
• Energy is a key benefit that is being used to increase sales 21
Source: The Mintel Group Nuts and Dried Fruit Report, January 2011

22. U.S. Macadamia Nut Market
For Use by Intended Recipient Only
22

23. IMS Conference – September 2012
U.S. Supply
Metric Tons 2010 2011 2012 est.
Domestic Production 3,890 4,500 4,300
Kernel Imports
Kenya 1,498 2,578 2,600
For Use by Intended Recipient Only
S. Africa 2,336 2,437 2,500
Australia 1,384 396 750
All Others 2,013 2,026 1,950
Total 7,231 7,437 7,800
Kernel Exports (733) (735) (800)
Consumption 11,202 11,300 11,300
Est. Global Crop 27,574 29,000 32,500
Est. % of Global Crop 40.6% 39.0% 34.8%
23
Source USDA NSS Reports

24. Macadamia commodity price
Historical and Projected
Price per pound
$8.00
$7.00
$6.00
$5.00
$4.00
For Use by Intended Recipient Only
$3.00
$2.00
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
• Pricing driven up primarily by increased demand, China
consumption and lower then expected Australian crop
• Weather has affected crop size
• Pricing is projected to decline as the global crop increases
• Normal weather in Australia
24
• New acreage in South Africa

25. Continental U.S. macadamias
Situation
•52 weeks FDM sales ending were $10.0MM (-6.0%)
•Private label is the leading brand with a 49% share
•Mauna Loa is #2 with a 34% share
For Use by Intended Recipient Only
•Macadamia sales shifted to other nuts, primarily almonds
Key issues
•Loss of distribution in major continental US FDM retailers
•Lack of brand support with consumers and trade
•Lack of product innovation capitalizing on wellness trends
25
(1) IRI FDM Sales data

26. Macadamia nut consumer
For Use by Intended Recipient Only
26
Source: The Mintel Group Nuts and Dried Fruit Report, January 2011

27. IMS Conference
U.S. Macadamia Consumption
Mix by Geographic Market:
Hawaii 20 % 2.200 MT
For Use by Intended Recipient Only
U.S. Mainland 80% 9.100 MT
Total 100 % 11.300 MT
27
• Internal estimates only

28. IMS Conference
U.S. Macadamia Consumption
Continental US
Macadamia Nuts and Related Products
Mix by Channel
($ million)
For Use by Intended Recipient Only
Grocery 23.0 38%
Drug 3.4 6%
Mass 0.8 1%
Club 33.3 55%
Total 60.5 100%
Internal estimates only. 28

29. IMS Conference
U.S. Macadamia Consumption
US Market Potential
• If marketed aggressively and properly, the U.S. market could
absorb 100% of the global macadamia crop.
• Direct selling opportunities offer tremendous potential
• Club stores, mainly Costco, are carrying the weight, but Food, Drug
and Mass channels are largely underserved
• Health attributes have not been adequately communicated
• Inconsistent quality of foreign kernel has been an issue
• Consistent supply is a challenge in the current market