The Story so far 1990 company founded 1992 ‘diabetic’ chocolate bars

2. The Story so far 1990 company founded 1992 ‘diabetic’ chocolate bars 1993 dairy free dark chocolate bars 1994- No Added Sugar replaces ‘diabetic’ 2003 Range expands to include mints, easter eggs, boxed chocolates Re Branding as ‘freefrom’ BRC & supply UK multiples Development of ‘alternative to milk chocolate’ Launch of O/L and Choices brand of ‘alternative to milk chocolate’ Choices Caramel wins Highly Commended at Quality Awards Expansion of range to include buttons Choices Caramel wins Highly Commended at Freefrom Awards

4. The scope of freefrom. Allergens Y Sugar Free/No Added Sugar Y Dietary Products N

5. The availability of ingredients & raw materials within the chocolate confectionery category. Milk alternatives Y Gluten Free Y Wheat Free Y Egg Free Y Nuts Free ?

6. The incidence of allergies & intolerances Milk 1.5% Coeliac 1% Wheat < 1% Nuts <1% Eggs <1% Soya <1%

7. Other Opportunities Diets 30% Lifestyle (vegan etc) 10% Genetic Disposition 30% (Lactose Intolerance)

8. Research in Ireland An Bord Bia (Irish Food Board) Base: Ever purchased Bakery/Confectionery Satisfaction levels with current offering: Overall satisfaction: 7.8 Information: 7.7 Value for Money 6.4 Availability of product 7.0

9. Research in Ireland (An Bord Bia – The Irish Food Board) Base Ever Bought Bakery/Confectionery Dairy/ Sugar Free/ Gluten etc No Added Sugar Must East 75% 25% Healthy Eating 25% 75% Purchase Frequency Often 75% Not Often 75% Special Fixture in Store 75% Conventional Fixture 75%

10. Research in Ireland An Bord Bia (Irish Food Board) Base: Ever bought bakery/confectionery Ever Tried Sugar Free/No Added 68% Gluten/Wheat 29% Freefrom Products ever purchased Bread 39% Breakfast Cereals 31% Rice Cakes 29% Sweet Biscuits 20% Chocolate 19%

11. Research in Ireland An Bord Bia (Irish Food Board) Suggested improvements Base Ever Bought Cheaper Price 23% Wider Selection 9% Availability 8%

12. Research in Ireland An Bord Bia (Irish Food Board) Ideal Free From Product Clear Ingredient Labelling 50% Low Price 49% Great Taste 51%

13. The scale of the market for freefrom in the chocolate category Dairy Free 1.5% Gluten/Wheat Free 1.0% Sugar Free/No Added Sugar a variant on conventional chocolate

14. A Parallel Universe Soya/Rice Milk % of Liquid Milk sales 2.5% - 3.0% Growth Rate 25% p.a. Have Tried 60% Don’t Like the Taste 30% Wouldn’t try it again 19% Regular Users 7%

15. The scope of the market for freefom +/- 3% of pop Market Drivers Quality/Taste Improving Price Too High Availability Improving Awareness Limited to ‘must haves’

16. The Freefrom Universe Consumers Retailers Mainstream Retailers Specialist Suppliers Commercial Suppliers Artisan

17. The UK Multiples Asda Freefrom Aisle Freefrom Own Label Freefrom Branded Morrisons Freefrom Aisle Freefrom Own Label Freefrom Branded Sainsbury’s Freefrom Aisle Freefrom Own Label Freefrom Branded Tesco Freefrom Aisle Freefrom Own Label Freefrom Branded

18. What’s the size of the cake? Grocery spend on Food £71bn Freefrom @ 3% £2 bn Key Categories Dairy £10.0bn Freefrom @ 3% £200 m Bakery £ 8.5 bn Freefrom @ 3% £255 m Confectionery £ 6.8 bn Freefrom @ 3% £200 m [Note fragmentation of categories outside of dairy/bakery i.e not all or most of the category requires a freefrom alternative]

19. Limiting Factors Multiples Store Space Turnover per sq ft v conventional Product Quality & Range Prices Food Safety Issues

20. Convenience Stock losses due to weak t/o of freefrom volumes Primary focus on Big Brands Convenience supplies existing products Multiples/Specialists develop new products Multiples have taken the lead in the development of freefrom.

21. Will freefrom become mainstream? Only if it can deliver Taste Quality Range Price Food Safety Equal or better to conventional option. Is this possible?

22. Back to the Future? 1970’s Fresh Milk sold at ambient temperature in shops Funny thing called ‘yoghurt’ finds traction Growth limited by Range, Quality, Price Growth limited by cost/availability of chilled space Early brand leaders dominant

23. Noughties Massive chilled display aisles Enormous range of chilled dairy products Consumer speak includes ‘l casei immunitas’, ‘plant sterols’ etc. Category dominated by international brands

24. Prognosis Freefrom will grow at a fast rate Growth will be facilitated by multiples Growth will be driven by quality/taste/range Price will be a key factor

25. Own Label or Branded? Primary consideration is consumer need & behaviour Freefrom consumers need appropriate products to eat Freefrom Consumers shop local & national retailers Freefrom Consumers buy O/L and branded O/L works for larger volumes & everyday purchases Branded works for smaller volumes & gift e.g. easter eggs, boxed chocolates and independent retailers/smaller outlets

26. Celtic Chocolates We like making life a little better for people with food allergies/intolerances and special needs We like working with our colleagues in the retail and distribution sector We like the feedback to date to our freefrom range We plan to expand our range even further. We dreaming of a ‘white’ Christmas !

27. Thank You! Joe Callery Managing Director Celtic Chocolates Limited Summerhill Co Meath Ireland joe@celticchocolates.eu