Barry Callebaut : Half-Year Results 2016/17 - Letter to Investors 2016/17

• Volume growth picking up in Q2 +3.5%, fueled by key growth drivers, resulting in above-market1 growth in the first half

  of the fiscal year +1.4%

• Sales revenue up +2.5% in local currencies to CHF 3.5 billion

• Strong operating profit (EBIT) improvement of +19.3% in local currencies, of which +11.1% recurring; net profit up +32.6% in local currencies of which +18.9% recurring

• Mid-term guidance confirmed2

Volume growth

vs. prior year in tonnes

EBIT growth

vs. prior year

in local currencies

1. Source: Nielsen, Global Chocolate Confectionery Market -2.1% in volume August 2016 - January 2017.

2. On average for the 3-year period 2015/16 to 2017/18: 4-6% volume growth and EBIT above volume growth in local currencies, barring any major unforeseen events.

Letter to Shareholders Key Figures Business Highlights Financial Report Information

Dear Shareholders,

We keep delivering on our "smart growth" agenda. Sales volume growth picked up to

+3.5% in the second quarter (first quarter -0.4%) and we reached a volume growth of

+1.4% in the first six months of fiscal year 2016/17. This contrasts with a decline of the global chocolate confectionery market by -2.1% 1. We significantly improved our prof- itability as a result of our ongoing focus on product and customer mix, as well as the successful implementation of our Cocoa Leadership program. At the same time, we continue to focus on free cash flow and returns.

Volume growth picking up, significant profit improvement

Sales volume in chocolate accelerated in the second quarter to +4.9%, reaching +3.5% for the first 6 months. This growth was fueled particularly by Outsourcing, but also Gourmet & Specialties and Emerging Markets. In cocoa we completed the intentional phase-out of less profitable contracts, which led to a decline of -5.0%. Overall, the Group's sales volume increased +1.4% to 946,782 tonnes.

Sales revenue grew above volume by +2.5% in local currencies (+3.3% in CHF) to CHF 3,538.7 million, due to a better product mix and partly offset by lower raw material prices.

Operating profit (EBIT) improved by +19.3% in local currencies (+18.8% in CHF) as a result of the good gross profit and amounted to CHF 238.4 million. Excluding the non- recurring acquisition-related income of CHF 16.3 million the EBIT increase was +11.1% in local currencies.

Net profit was up +32.6% in local currencies to CHF 142.1 million due to the strong increase in EBIT, lower net finance costs and despite a higher effective tax rate. Exclud- ing the non-recurring effect it was up +18.9% in local currencies.

The seasonality from the cocoa main crop is reflected in the free cash flow, which was CHF -29.0 million for the 6-month period. On a 12-month rolling basis, free cash flow was CHF 154.6 million.

Further implementing our proven strategy

We made again good progress in the implementation of our long-term strategy, which is key to continuously outperforming the market.

Expansion

On December 31, 2016, we completed the acquisition of the chocolate production facil- ity of Mondelēz International in Halle, Belgium. The transaction also includes a long- term agreement for the supply of an additional 30,000 tonnes of liquid chocolate per year to Mondelēz International. The opening of our first chocolate factory in Indonesia was also an important milestone.

Innovation

We completed more than 700 R&D projects and launched a number of new products, including a new range of chocolate and fruit fillings with low water activity. Our subsid- iary la Morella nuts extended its portfolio with a new range of organically grown Medi- terranean nuts.

Sustainability

In November 2016, we launched our new sustainability strategy "Forever Chocolate", with the ambition to have 100% sustainable chocolate by 2025. "Forever Chocolate"

 Nielsen, August  - January 

Letter to Shareholders Key Figures Business Highlights Financial Report Information

includes four targets that we expect to achieve by 2025 and that address the biggest sustainability challenges in the chocolate supply chain: child labor, farmer poverty, carbon and forest footprint and sustainable sourcing.

Outlook

We will continue to execute our "smart growth" strategy. Whilst markets remain vola- tile, we have built a healthy chocolate portfolio and expect the good momentum to con- tinue. We will also further pursue the implementation of our Cocoa Leadership program. On this basis, we confirm our mid-term guidance 2.

April 12, 2017

Patrick De Maeseneire Antoine de Saint-Affrique

Chairman of the Board Chief Executive Officer

 On average for the -year period /-/: −% volume growth and EBIT above volume growth in local currencies, barring any major unforeseen events.