Sustainability

Dear Stakeholders,

“Improving lives” is the theme that runs through this Sustainability Report as we continue to be Driven by Responsibility to make a positive contribution to people, society and the planet. This is our seventh annual Sustainability Report and it represents our continuing commitment to do business that creates economic, social and environmental value for all those we reach. “Improving lives” refers to the way we create more food, nutrition and beverage options for consumers and support consumers that want to lead healthy lifestyles. We believe that sustainable business growth, rooted in our responsible approach to business, will help us do even more in the future to contribute to improving lives.

2013 was a landmark year in our sustainability journey, as we completed our global sustainability strategy that will guide and define our actions through 2020. We achieved this after many long months of analysis, consultation, dialogue and debate. The process was illuminating and engaging, and the outcome is an integrated framework that we are confident will help us continue to deliver sustainable value. For Strauss Group, composed of five different companies, each with a unique business character, this overarching strategic approach will help us work across company boundaries to address the broader needs of stakeholders, create synergies, leverage our strengths, learn from one another and most importantly, improve our capability to deliver value for all.

Our business context during the past year presented new opportunities and enabled us to maintain Strauss Group global sales at more than $2.35 billion, delivering more than $220 million in operating profit as we continue our operations in 24 countries with a global team of more than 13,500 employees. We were able, in 2013, to grow our business across all product categories, indicating a positive response from our consumers, especially our coffee consumers in Brazil with our partners at Três Corações and the expanded offerings of our Sabra dips and spreads in the U.S. We are excited that our U.S. consumers love the taste of hummus, with Sabra continuing to lead the market with 64% share.

During the year, we consolidated our position in the Russian coffee market through acquisition of remaining shares of Le Café roasted and ground coffee operations, and we inaugurated our Sabra “Center of Excellence” research and development center in the U.S., the first of its kind in the industry for chilled dips and spreads. Max Brenner continued to expand, opening more signature Chocolate Bars across different continents, bringing new chocolate experiences through more than 50 Chocolate Bars in six countries. In Israel, Strauss Water launched the innovative Tami 4 Bubble Bar, which dispenses carbonated water in addition to hot and cold options, bringing consumers a technological breakthrough in the WaterBar category for a healthy, fun and environmentally positive drinking experience. Strauss Israel continued to innovate with more than 228 new products and product variants reaching the market across all categories.

In 2013, as in previous years, we continued to face the challenges of delivering value in demanding economic circumstances. These include high energy prices, increasing raw material prices and packaging costs, political, social and economic instability in Eastern Europe where we enjoy significant market presence, more demanding regulation in areas of food safety and environmental protection and increased frequency of weather extremes causing disruption to crop availability and disasters affecting many communities around the world. We have navigated these challenges, Driven by Responsibility, striving to improve value-adding choices for Strauss Group and for our consumers and stakeholders.

Among these choices has been our undertaking to focus on three areas where we hope to achieve industry leading positions as we go forward toward 2020: advancing healthy lifestyles for our consumers, leading our employees to greater health and wellness and achieving greater supplier diversity in our supply chain operations around the world. We believe we can make a sustainable difference through these key aspirations, while continuing to improve our sustainability performance in other areas. Further, this year, we became early adopters of the Global Reporting Initiative G4 sustainability reporting framework, aligning our reporting with current leading global practice in transparency and accountability.

We are appreciative of the tireless efforts of our employees around the world who help Strauss Group create sustainable value, and we thank our consumers, business partners, suppliers and all other stakeholders for another year of trust, dialogue and partnership.

We hope you will find interest in this report and as always, we welcome your feedback.