21st August 2014

1H 2014 BUSINESS REVIEW

F INANCIAL H IGHLIGHTS – 1H 2014

Note: - Subsidiary profit after tax numbers are reported at 100%

- Engro Consolidated profit after tax numbers excludes non-controlling interest

Rs. Million Revenue Profit After Tax

Business 2014 2013 2014 2013

Engro Fertilizers 27,657 20,519 3,375 1,425

Engro EXIMP 13,274 10,139 (2,108) (352)

Engro Polymers 11,903 12,031 123 425

Engro Foods 20,100 19,415 329 1,113

Engro PowerGen Qadirpur 6,516 5,179 1,088 1,046

Engro Vopak 1,018 951 713 575

Engro Consolidated 77,541 66,874 2,684 3,341

• Revenue increased by 16% and PBT increased by 11% over same period last year

• Despite better operational performance, PAT lower due to higher effective tax rate vs. last year

FERTILIZERS

3

2013 Business Results

FERTILIZERS – UREA MARKET

Urea Industry (MT)

1H 2014 1H 2013

Production 2.3 2.2

Sales 2.6 2.7

Imports 0.4 0.2

Industry sales slipped by 5% in 1H 2014 as compared to 1H 2013 (2.6MT vs. 2.7MT) because of:

• GoP price equalization between imported and local urea which led to temporary dealer uncertainty on margins

• Slight delay in wheat harvest which rolled 2Q demand forward to July

Sale of branded urea increased by 4% vs. 1H 2013

Total urea production increased by 5% due to improved gas availability to fertilizer sector by the Government

Significant gap between local urea and international urea prices prevailed during the period. The benefit passed on by the local producers to the farmers in 1H 2014 is around PKR 25 B

Latest international urea prices are around USD 300 per ton (CFR) which is equivalent to local landed delivered cost of PKR 2,241 per bag (inclusive of all ancillary charges) as against local price of PKR 1,813/bag

2014 Business Results

429 443 421 401 380 341 329 321 316 318

346 354 365 361 339 323 313 288

Jan

'13

Feb

'13

Mar

'13

Ap

r'1

3

May

'13

Jun

'13

Jul'1

3

Au

g'1

3

Sep

'13

Oct

'13

No

v'1

3

De

c'1

3

Jan

'14

Feb

'14

Mar

'14

Ap

r'1

4

May

'14

Jun

'14

Imported Urea Prices (CFR Karachi)

2013 Business Results

EFert continued to receive uninterrupted gas supply to run both of its plant during 1H 2014. Gas supply from SNGPL, however, was reduced in May 2014 from 17 MMSCFD to 6 MMSCFD due to diversion to the power sector

Higher production resulted in higher sales which increased market share to 33% in 1H 2014 from 23% in 1H 2013

Fuel GIDC was hiked by PKR 50/MMBTU to PKR 150/MMBTU effective July 1, 2014

The industry continues to absorb much of the cost impact of hike in GIDC effective December 31, 2013

Going against the Fertilizer Policy 2001 and contracts entered into with fertilizer companies (including EFert), GoP has decided to levy GIDC on fixed price contracts. Engagement with GoP is underway / legal recourse is being considered

FERTILIZERS – BUSINESS H IGHLIGHTS

847 841

617 622

Production (kT) Sales (kT)

Urea Operations

1H 2014 1H 2013

2014 Business Results

33%

50%

12% 5%

Market Share 1H 2014

Engro FFC NFML Others

2013 Business Results

Gas Update

Mari SML contract has been extended for another year

Engagement continues with Mari and SNGPL for implementation of concessionary gas price arrangement

Pursuing Long Term Gas Allocation and specifically KPD allocation to fertilizer sector is still pending with the ministry for ratification

Other Highlights

IFC has USD 15 M (on ECorp) and USD 9 M (on EFert) share conversion options related to two of their loans. During April 2014, IFC exercised its option and converted USD 7 M in ECorp shares and in July 2014 also converted USD 5 M in EFert shares. IFC is likely to exercise the remaining options in due course

PKR 8 B was offered as early repayment to restructured lenders as specified in the restructuring agreement. Out of this, PKR 4.9 B has already been paid and the remaining amount should be cleared by October 2014

FERTILIZERS – BUSINESS H IGHLIGHTS (CONTD.)

2014 Business Results

2013 Business Results

FERTILIZERS – BUSINESS H IGHLIGHTS (CONTD.) Phosphates Business

After a significant decline in international DAP prices from USD 560/ton level in Jan 2013 to USD 400/ton level by end of 2013, the market picked up reaching a high in February 2014

Low purchase price together with pre-season

booking by dealers due to higher international prices allowed Eximp to secure good margins

Domestic phosphates industry sales were at 391 KT

vs. 423 KT last year because of GoP plans to subsidize phosphatic fertilizer

Eximp sold 96 KT of DAP in 1H 2014 vs. 81 KT in 1H

2013, increasing the total market share from 19% last year to 24% and the imported market share from 51% last year to 54% in the current period

Higher volumes and better margins resulted in a strong performance for the commodity trading business

391

423

1H2014 1H2013

Phosphate Industry Sales KT

560 540 544 550 540 520 480 450

410 402 399 401 403 436

475 471 459 457

Jan

'13

Feb

'13

Mar

'13

Ap

r'1

3

May

'13

Jun

'13

Jul'1

3

Au

g'1

3

Sep

'13

Oct

'13

No

v'1

3

De

c'1

3

Jan

'14

Feb

'14

Mar

'14

Ap

r'1

4

May

'14

Jun

'14

DAP Prices (CFR Karachi)

2014 Business Results

FOODS

8

2013 Business Results

Dairy & Juices

Olper’s Lassi and Rooh Afza were launched during the period

Volumetric increase of 4% in dairy and beverages segment vs. 1H 2013 as operational challenges were overcome while an estimated 9% growth in total UHT industry vs. 1H 2013 was witnessed

Gross margins have decreased mainly due to higher milk prices which were not passed on to consumer due to market environment

Market share remained over 50%

18.1

1.7 0.2

17.5

1.4 0.5

Dairy & Juices Ice cream Foods Canada

Revenue (Rs. Bn)

FOODS – BUSINESS H IGHLIGHTS

0.7

(0.1) (0.06)

1.4

(0.1) (0.10)

Dairy & Juices Ice cream Foods Canada

Profit After Tax (Rs. Bn)

2013 2014

2014 Business Results

2013 Business Results

NARA Farm

Highest ever milk production at NARA farm – 38.2 klpd vs 24.9 klpd in 1H 2013

Number of milking animals increased to 1,480 in 1H 2014 versus 996 in the comparative period with a 4.3% increase in milking yields of animals

Ice Cream

Industry volumes grew by 10%

Omore’s market share rose to 28% vs. 26% in 1H 2013

Fresh Dairy

14 “Mabrook” shops are operational. 23 more in development phase

Engro Foods Canada

Revenue declined from CAD$ 5.0 million to CAD$ 2.7 million as new entrants pushed shelf space. Loss after tax stood at CAD$ 0.67 million versus CAD$ 0.71 million in 1H 2013

FOODS – BUSINESS H IGHLIGHTS (CONTD.)

2014 Business Results

RICE

11

2013 Business Results

Despite significant increase in paddy (raw material prices) in 4Q 2013, international rice prices did not increase in line with paddy prices:

Middle East governments implemented strict price controls and buyers were

reluctant to commit volumes Iran import volumes fell from 120KT per month in Nov 2013 – Feb 2014 to 55KT

levels between Mar 2014 - May 2014 which depressed both Indian and Pakistani basmati prices

Excess supply and significant build up in inventory in both India and Pakistan

The unusual PKR appreciation hit export margins and also affected local rice

prices

Due to the above reasons, the Rice business incurred a loss of PKR 2,461 M vs. PKR 634 M in 1H 2013

Plant continues to perform at optimal efficiency – average service and capacity factor of 72% and 76% respectively

The management has decided to re-evaluate the scale of the rice business, change the business model to reduce the exposure to commodity price volatility and focus on reduction of fixed costs to curtail possibility of future losses

R ICE – BUSINESS H IGHLIGHTS

23.4

12.0

12.7

17.6

2014 2013

Sales Volume (kt)

Export Domestic

4,300

2,997

2014 2013

Revenue PKR (mn)

(2,641)

(634)

2014 2013

PAT PKR (mn)

2014 Business Results

2013 Business Results

R ICE – H ISTORICAL PRICES*

0

20,000

40,000

60,000

80,000

100,000

120,000

140,000

PKR/Ton

2009

2010

2011

2012

2013

Crop 2009 Crop 2010 Crop 2011 Crop 2012 Crop 2013

*Local Super Basmati UFR White Prices

2014 Business Results

PETROCHEMICALS

14

2013 Business Results

2013 2014

PETROCHEMICALS – BUSINESS H IGHLIGHTS Ethylene prices remained firm during most of 1H 2014 due to tight

supply driven by cracker shutdown leading to margin compression for the business

VCM production lower due to operational issues at the plant which were resolved timely and planned shutdown in June 2014

International PVC prices towards the end of 1H 2014 firmed up

driven by pre-monsoon demand in India and SEA. Also, high feedstock costs and anti-dumping duty on PVC in India lent support

Domestic PVC market improved in 2Q 2014 due to inventory carry over effect subsiding, less volatile exchange rates and stable PVC prices

15 kT PVC de-bottlenecking project is in progress and expected to be completed by 3Q 2014

The Company achieved PVC domestic market share of 77% in 1H 2014

Towards the end of June 2014, 5% duty was imposed on Company’s primary raw material Ethylene and EDC. The matter is being pursued with relevant Government authorities for recourse

68 68 56

70 84

55

PVC VCM Caustic Soda

Production (KT)

63

46

70

48

PVC Caustic Soda

Domestic Sale Volume (KT)

11,903

12,031

Revenue (PKR M)

123

425

PAT (PKR M)

2014 Business Results

POWER

16

2013 Business Results

POWER – BUSINESS H IGHLIGHTS

97.5

85.6

2014 2013

Load Factor (%)

903

796

2014 2013

Net Electrical Output (GWh) Billable Availability Factor was lower due to outages (mainly due to issues at OGDCL’s end)

EPQL achieved a PAT of PKR 1,088 M in 1H 2014 vs. PKR 1,046 M in the comparative period

Overdue receivables from PEPCO stood at PKR 1,968 M as at June 30, 2014 vs. PKR 1,204 M as at December 31, 2013 due to a buildup of circular debt

Offer for Sale

The ECorp and EPowergen is in the process of offering 25% of its share capital (80.95 M shares) to the public through an Offer for Sale

40.475 M shares (50% of the offering) were privately placed at a share price of PKR 30.02 per share

The remaining shares will be offered to the general public through an IPO expected in September 2014

99.9

100.5

2014 2013

Billable Availability Factor (%)

2014 Business Results

CHEMICAL STORAGE & HANDLING

18

2013 Business Results

Profits include gain on foreign currency loans due to PKR appreciation

EVTL secured 3rd position in 79 Vopak Terminals from 31 Countries in the Vopak Global SHE award 2013

LNG Update

LNG Service Agreement (LSA) was formally signed on April 30, 2014 with SSGC for a period of 15 years for LNG handling facilities on a tolling basis.

An Implementation Agreement with Port Qasim Authority as well as agreement for Engineering, Procurement & Construction and Time Charter Party agreement of Floating Storage & Regasification Unit has also been signed.

1,018

951

Revenue (Rs. Mn)

713 575

PAT (Rs. Mn)

2013

2014

CHEMICALS STORAGE & HANDLING

2014 Business Results

SINDH ENGRO COAL MINING CO.

20

2013 Business Results

SECMC Update

Effective March 31, 2014, Engro’s holding in SECMC was reduced to 32%. However, management control remains with Engro

During the period, the Company finalized the EPC contractor for the mining project

LOI and Contract Term Sheet for 3.8MPTA mining contracts were also signed

Geo-technical study by EPC contractor shall be started in 3Q 2014

The Company has successfully acquired possession of 3,842 acres of land for start of physical

work

Site mobilization, camp set-up and other utilities have been put in place for the 3.0 M BCM local OB removal job

2014 Business Results

2013 Business Results

Questions & Answers

2014 Business Results