The JUICE MARKET Ashgabat, Turkmenistan June-July, 2013

Table of contents 2 Research Data – Research Data – Slide 3. Stage 1: Store Check – Stage 1: Store Check – Slide 4. Key indicators of the market resume the Store Check – Key indicators of the market resume the Store Check – Slide 5. Import market structure – Import market structure – Slide 6. Volumes of export of juice production from Russia– Volumes of export of juice production from Russia– Slide 7. Participants of the market with indicator Distribution Level – Participants of the market with indicator Distribution Level – Slide 8. Card of the basic brands of the market of key players on indicator Distribution Level – Card of the basic brands of the market of key players on indicator Distribution Level – Slide 9. The short description of key players of indicator Distribution Level Distribution Level – The short description of key players of indicator Distribution Level Distribution Level – Slide 10. Stage 2: F2F interrogations of the population of Turkmenistan – Stage 2: F2F interrogations of the population of Turkmenistan – Slide 11. Key indicators following the results of population polls Key indicators following the results of population polls Frequency of consumption of juice on regions in % – Frequency of consumption of juice on regions in % – Slide 12. Frequency of consumption of juice on age distinction in % – Frequency of consumption of juice on age distinction in % – Slide 13. Brand of juice, respondents named as favourite – Brand of juice, respondents named as favourite – Slide 14. Conclusion – Conclusion – Slide

Research Data 3 Goal: Goal: To define structure of juice, nectars and drinks containing juice market of Turkmenistan, to reveal key players, to define a favorite brand of consumers of a category. Methodology: Methodology: Research consisted of two stages: Stage 1: Store Check of outlets Stage 2: F2F population polls Sample Sample : Stage 1: 100 trade outlets (Ashgabat) Stage 2: 1000 respondents (Turkmenistan)

Stage 1: Store Check 4 For the first research stage has been generated the panel of sample of Ashgabat outlets: Objects of research: Supermarket 2 Minimarket 7 Convenience 34 Grocery/state outlet 9 Shop in the open markets 10 Kiosk 8 Other (pavilions / containers / cellars) 30 Итого:100 Categories:SKU information: Juice The brand name Nectars The manufacturer Juice-containing drinks Packing weight/volume Outlet information: Packing type The address The price Outlet type

Key indicators of the market resume the Store Check 5 The spectrum of drinks in Turkmenistan is very wide. On store shelves of capital juice, nectars, berry juices, steel and carbonated water, various soft drinks, kvass, tonics, power drinks are presented in a variety. Presents of cold tea and juice- containing drinks has grown last years. In total in the market of Ashkhabad in categories juice/nectars/juice-containing drinks production more than from 50 manufacturers is presented, from which only 10,15 % brands of local manufacturers as it is presented on the diagram low. As to segmentation on a price, the share of a high price segment in general structure of the market of juice is insignificant and constitutes only 4,92 %. The largest segment of our market of juice is a segment of low price - its share constitutes 61,85 %. The average price segment has a share of 30,77 % in general structure of the market of juice / nectars / juice-containing of drinks. The least share in a researched category belongs to brands of a segment a premium – 2,46 %

Import market structure 6 More than 50 % of an import market of juice, nectars and juice-containing drinks of Turkmenistan is from Russia and Kazakhstan.

Export volumes of juice/nectar/juice containing drinks from Russia 7 According to express calculation of export of juice and nectars to Turkmenistan from Russia, given by company VVS, volumes have increased more than twice: RESULTS OF EXPRESS CALCULATION on export of juice and nectars to Turkmenistan Positions TN FTA The period The appointment country Direction Total quantity of deliveries Quantity of the Russian participants Total sum of sales in $ 2009, May 2013TurkmenistanExport For comparison two quarters have been analyzed: 1st quarter 2012 and 1st quarter It is revealed that the market volume has increased more, than in 2 times! The market share of the leader - OC START TERMINAL UNI LOGISTIKS ON THE INSTRUCTIONS OF the OS VIMM-BILL-DANN DRINKS – has decreased on – 2,8 %. And the market share of its direct competitor - OC TMN LODZHISTIK ON THE INSTRUCTIONS OF OC COCA-COLA HBC Eurasia – has opposite increased on + 16,3 %! For a quarter in the market there were 2 new companies which have entered into the five of leaders among exporters.

Participants of the market with indicator Distribution Level 8

Card of the basic brands of the market of key players on indicator Distribution Level ИП Парахат 9

The short description of key players of indicator Distribution Level 10 SP Parahat SP Parahat – the local manufacturer of juice and nectars. In the market since May, 2013 with the brand JOŞ. But because of competently organized active distribution of all for a month (research was conducted in the end of May- beginning of June 2013) takes of an in the lead position on availability of a product in the market. Gilan Holding Gilan Holding – Production Azerbaijan, the Baku factory on production of water and juice under trade mark Jal ә since OC «Sandora» OC «Sandora» - Production Ukraine. The company is created in Design cumulative capacity of the enterprises – about 1,5 billion packets of juice and juice goods in a year. The company exports 20 % of goods and is presented in more than 20 countries of the world. In Turkmenistan trade marks "Sandora" and "Sadochok" are presented in category. Research has shown that grocery lines in the market are very limited – 77 % of manufacturers are presented in the market by one brand, 14 % - by two and only 9 % of manufacturers offer three and more brands of goods to the consumer. These are OS Lebedjanskiy (Russia) with marks "I", Fruktoviy Sad", "Tonus", "FrutoNyanya"; OC RG Brands (Kazakhstan) with trade marks "Gracio", Da-Da" and "Nectar Solnechnyi"; OS VBD Drinks (Russia) – marks "J7", Lyubimyi", "J7 light" and the local manufacturer of JS Company "Ruhubelent" with marks "Galkynyş", "Diyar and "Altyn Zaman". 68 % of the brands which are present in the market of juice, nectars, juice-containing drinks are packed into cardboard packaging, in a glass bottle are 16 %, in PET - packaging are 13 % and 3 % are packed in cans/foils.

Stage 2: F2F population polls 11 The second stage of the research was conducted in July 2013 Sample Sample: representative, 1000 respondents Geography: Turkmenistan (capital + key cities): RegionCities MenWomen Total years years years years years years Ashgabat Ahal Tedjen Balkan Balkanabad Dashoguz Kunyaurgench Lebap Turkmenabad Seyidi Mary Bayiramali

Key indicators following the results of population polls 12 Frequency of consumption of juice on regions in %

Key indicators following the results of population polls 13 Frequency of consumption on age distinction in %

Key indicators following the results of population polls 14 The brand of juice named respondents as a favorite brand in %

Conclusion. 15 Juice and nectars in Turkmenistan is not included into the inventory of the first necessity. According to experts data consumption of juice increased last years. In 2012 according to the Ministry of Trade juice consumption has constituted 12 l a year per capita. The most part of juice goods is consumed in big cities and capital. This results from the fact that in big cities earnings at people above, than on periphery. Nevertheless, consumption of juice goods inhabitants in Turkmenistan essentially lags behind till now average indexes in the majority of the European countries. For comparison: in Germany average consumption of juice on one person constitutes about 45 liters a year. In Russia and Kazakhstan by different estimations of liters in a year per capita.

16 The Turkmen market of juice has a high potential. Consumption of juice and juice goods the next years will grow. Experts predict substantial growth of a market share of local manufacturers of juice. Simultaneously with a market saturation of "usual" juice the increase in a share of "functional" drinks (functional - any drink which is positioned as useful to health) is predicted. Thank you for attention! The address: Turkmenistan, Ashkhabad, Mir3/2, build. 29, 1 floor, Office TMH Company Tel/fax: +993(12) Web-cite: