RubinBrown Food & Beverage Mid-Year Review 2014

Public Equity Markets: Food & Beverage Returns

Food & Beverage Companies Continue to Chug Along Through the first half of 2014, the S&P Food & Beverage Select Index (“F&B Index”) continues to see record growth and outsized returns, with the index value reaching another all time high of 3,663 on June 30, 2014. While the all-time highs for the F&B Index have generally coincided with all-time highs for the S&P 500 index (which closed at 1,960 on June 30, 2014), the F&B Index has seen outsized returns relative to the S&P 500 dating back to the end of 2012. Over the last year and a half, the F&B Index has outpaced the S&P 500, generating total returns of 47.3% since December 31, 2012 – relative to 34.0% for the S&P 500. Both the F&B Index and S&P 500 have generally outgained the S&P 500 Consumer Staples Sector Index dating back to June 2013. When further stratifying the food and beverage universe into subsectors consisting of companies with TTM revenue less than $1 billion (refer to pages 12 – 14 for the subsector constituents) the substantial outperformance by beverage companies since the , end of 2012 has eroded somewhat during the first half of 2014 as investors have cashed in on their profits. Similar profit taking can be seen in the other food and beverage subsectors as well during the first half of 2014 – albeit to a lesser degree. Equity Performance by Subsector Industry Equity Performance

80%

80% S&P 500 Index

S&P 500 Consumer Staples Sector Index S&P Food& Beverage Select Industry Index S&P 500 Index

40% 50% 60% 70% 10% 20% 30% 10% 0%

40% 50% 60% 70% 10% 20% 30% 10% 0%

Food ProductionCompanies Beverage Companies Agriculture/Food Production Ingredients

53.2%

47.3%

34.0%

34 0% .

25.3%

24.0%

22.3%

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Source: S&P Capital IQ

Source: S&P Capital IQ

Food & Beverage Sector: 2014 Mid-Year Update

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