Health and Wellness in Malaysia

HEALTH AND WELLNESS IN MALAYSIA Euromonitor International September 2015

HEALTH AND W ELLNESS IN MALAYSIA

LIST OF CONTENTS AND TABLES Health and Wellness in Malaysia - Industry Overview .................................................................. 1 Executive Summary ..................................................................................................................... 1 Health and Wellness Packaged Food and Beverages Sales Continue To Increase ................. 1 Rising Health Awareness Continues To Drive Sales ................................................................ 1 Power Root Leads Sales in 2014.............................................................................................. 1 Hypermarkets and Supermarkets Remain Ideal Distribution Channels in 2014 ....................... 1 Outlook for Health and Wellness Packaged Food Remains Optimistic..................................... 1 Key Trends and Developments .................................................................................................... 1 Hypermarkets and Supermarkets Lead Distribution ................................................................. 2 Growing Number of General Wellbeing Packaged Food and Non-alcoholic Drinks ................. 3 Rising Consumer Health and Wellness Awareness .................................................................. 3 Market Data .................................................................................................................................. 4 Table 1 Table 2 Table 3 Table 4 Table 5 Table 6 Table 7 Table 8 Table 9 Table 10 Table 11 Table 12 Table 13 Table 14 Table 15 Table 16

Sales of Health and Wellness by Type: Value 2009-2014............................ 4 Sales of Health and Wellness by Type: % Value Growth 2009-2014 ........... 5 Sales of Health and Wellness by Category: Value 2009-2014 ..................... 5 Sales of Health and Wellness by Category: % Value Growth 20092014 ............................................................................................................. 6 Sales of Health and Wellness by Prime Positioning: Value 2009-2014 ........ 6 Sales of Health and Wellness by Prime Positioning: % Value Growth 2009-2014 .................................................................................................... 7 NBO Company Shares of Health and Wellness: % Value 2010-2014 .......... 7 LBN Brand Shares of Health and Wellness: % Value 2011-2014 ................ 8 Distribution of Health and Wellness by Format: % Value 2009-2014 ........... 9 Distribution of Health and Wellness by Format and Category: % Value 2014 ........................................................................................................... 10 Forecast Sales of Health and Wellness by Type: Value 2014-2019 ........... 10 Forecast Sales of Health and Wellness by Type: % Value Growth 2014-2019 .................................................................................................. 11 Forecast Sales of Health and Wellness by Category: Value 20142019 ........................................................................................................... 11 Forecast Sales of Health and Wellness by Category: % Value Growth 2014-2019 .................................................................................................. 12 Forecast Sales of Health and Wellness by Prime Positioning: Value 2014-2019 .................................................................................................. 12 Forecast Sales of Health and Wellness by Prime Positioning: % Value Growth 2014-2019 ..................................................................................... 13

Appendix .................................................................................................................................... 13 National Legislation ................................................................................................................ 13 Sources ...................................................................................................................................... 13 Summary 1

Research Sources ...................................................................................... 13

Health and Wellness in Malaysia - Company Profiles ................................................................ 16 Country Farms Sdn Bhd in Health and Wellness (malaysia) ...................................................... 16 Strategic Direction .................................................................................................................. 16 Key Facts ................................................................................................................................ 16 Summary 2

Country Farms Sdn Bhd: Key Facts ........................................................... 16

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Company Background ............................................................................................................ 16 Competitive Positioning .......................................................................................................... 17 Summary 3

Country Farms Sdn Bhd: Competitive Position 2014 ................................. 17

Malaysia Milk Sdn Bhd in Health and Wellness (malaysia) ........................................................ 17 Strategic Direction .................................................................................................................. 17 Key Facts ................................................................................................................................ 17 Summary 4

Malaysia Milk Sdn Bhd: Key Facts ............................................................. 17

Company Background ............................................................................................................ 18 Competitive Positioning .......................................................................................................... 18 Summary 5

Malaysia Milk Sdn Bhd: Competitive Position 2014.................................... 19

Better for You Beverages in Malaysia - Category analysis ......................................................... 20 Headlines ................................................................................................................................... 20 Trends ........................................................................................................................................ 20 Competitive Landscape .............................................................................................................. 21 Prospects ................................................................................................................................... 21 Category Data ............................................................................................................................ 22 Table 17 Table 18 Table 19 Table 20 Table 21 Table 22 Table 23

Sales of BFY Beverages by Category: Value 2009-2014 ........................... 22 Sales of BFY Beverages by Category: % Value Growth 2009-2014 .......... 22 NBO Company Shares of BFY Beverages: % Value 2010-2014 ............... 23 LBN Brand Shares of BFY Beverages: % Value 2011-2014 ...................... 23 Distribution of BFY Beverages by Format: % Value 2009-2014 ................. 23 Forecast Sales of BFY Beverages by Category: Value 2014-2019 ............ 24 Forecast Sales of BFY Beverages by Category: % Value Growth 2014-2019 .................................................................................................. 24

Better for You Packaged Food in Malaysia - Category analysis ................................................. 26 Headlines ................................................................................................................................... 26 Trends ........................................................................................................................................ 26 Competitive Landscape .............................................................................................................. 27 Prospects ................................................................................................................................... 27 Category Data ............................................................................................................................ 28 Table 24 Table 25 Table 26 Table 27 Table 28 Table 29 Table 30

Sales of BFY Packaged Food by Category: Value 2009-2014 ................... 28 Sales of BFY Packaged Food by Category: % Value Growth 20092014 ........................................................................................................... 29 NBO Company Shares of BFY Packaged Food: % Value 2010-2014 ....... 30 LBN Brand Shares of BFY Packaged Food: % Value 2011-2014 .............. 31 Distribution of BFY Packaged Food by Format: % Value 2009-2014 ......... 32 Forecast Sales of BFY Packaged Food by Category: Value 20142019 ........................................................................................................... 32 Forecast Sales of BFY Packaged Food by Category: % Value Growth 2014-2019 .................................................................................................. 34

Food Intolerance in Malaysia - Category analysis ...................................................................... 36 Headlines ................................................................................................................................... 36 Trends ........................................................................................................................................ 36 Competitive Landscape .............................................................................................................. 37 Prospects ................................................................................................................................... 37 Category Data ............................................................................................................................ 38 Table 31

Sales of Food Intolerance by Category: Value 2009-2014 ......................... 38

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Table 32 Table 33 Table 34 Table 35 Table 36 Table 37

Sales of Food Intolerance by Category: % Value Growth 2009-2014 ........ 38 NBO Company Shares of Food Intolerance: % Value 2010-2014 .............. 39 LBN Brand Shares of Food Intolerance: % Value 2011-2014 .................... 39 Distribution of Food Intolerance by Format: % Value 2009-2014 ............... 40 Forecast Sales of Food Intolerance by Category: Value 2014-2019 .......... 40 Forecast Sales of Food Intolerance by Category: % Value Growth 2014-2019 .................................................................................................. 41

Fortified/functional Beverages in Malaysia - Category analysis.................................................. 43 Headlines ................................................................................................................................... 43 Trends ........................................................................................................................................ 43 Competitive Landscape .............................................................................................................. 44 Prospects ................................................................................................................................... 44 Category Data ............................................................................................................................ 45 Table 38 Table 39 Table 40 Table 41 Table 42 Table 43 Table 44 Table 45 Table 46 Table 47 Table 48 Table 49

Sales of Fortified/Functional Beverages by Category: Value 20092014 ........................................................................................................... 45 Sales of Fortified/Functional Beverages by Category: % Value Growth 2009-2014 .................................................................................................. 46 Key Functional Ingredients in Fortified/Functional Juice Drinks (up to 24% juice): % Breakdown 2009-2014 ........................................................ 47 Key Functional Ingredients in Fortified/Functional Nectars (25-99% juice): % Breakdown 2009-2014 ................................................................ 47 Key Functional Ingredients in Fortified/Functional RTD Tea: % Breakdown 2009-2014 ............................................................................... 47 NBO Company Shares of Fortified/Functional Beverages: % Value 2010-2014 .................................................................................................. 47 LBN Brand Shares of Fortified/Functional Beverages: % Value 20112014 ........................................................................................................... 48 Distribution of Fortified/Functional Beverages by Format: % Value 2009-2014 .................................................................................................. 49 Key Functional Ingredients in Fortified/Functional RTD Tea: % Breakdown 2009-2014 ............................................................................... 49 NBO Company Shares of Fortified/Functional Beverages: % Value 2010-2014 .................................................................................................. 50 LBN Brand Shares of Fortified/Functional Beverages: % Value 20112014 ........................................................................................................... 50 Distribution of Fortified/Functional Beverages by Format: % Value 2009-2014 .................................................................................................. 51

Fortified/functional Packaged Food in Malaysia - Category analysis.......................................... 53 Headlines ................................................................................................................................... 53 Trends ........................................................................................................................................ 53 Competitive Landscape .............................................................................................................. 54 Prospects ................................................................................................................................... 55 Category Data ............................................................................................................................ 55 Table 50 Table 51 Table 52

Sales of Fortified/Functional Packaged Food by Category: Value 2009-2014 .................................................................................................. 55 Sales of Fortified/Functional Packaged Food by Category: % Value Growth 2009-2014 ..................................................................................... 56 Key Functional Ingredients in Fortified/Functional Biscuits: % Breakdown 2009-2014 ............................................................................... 57

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Table 53 Table 54 Table 55 Table 56 Table 57 Table 58 Table 59 Table 60 Table 61 Table 62 Table 63 Table 64 Table 65 Table 66

Key Functional Ingredients in Fortified/Functional Breakfast Cereals: % Breakdown 2009-2014 ........................................................................... 58 Key Functional Ingredients in Fortified/Functional Bread: % Breakdown 2009-2014 ............................................................................... 58 Key Functional Ingredients in Fortified/Functional Chocolate Confectionery: % Breakdown 2009-2014 ................................................... 58 Key Functional Ingredients in Fortified/Functional Chewing Gum: % Breakdown 2009-2014 ............................................................................... 58 Key Functional Ingredients in Fortified/Functional Sugar Confectionery: % Breakdown 2009-2014 ................................................... 58 Key Functional Ingredients in Flavoured Milk Drinks: % Breakdown 2009-2014 .................................................................................................. 59 Key Functional Ingredients in Fortified/Functional Milk: % Breakdown 2009-2014 .................................................................................................. 59 Key Functional Ingredients in Fortified/Functional Dairy-based Yoghurt: % Breakdown 2009-2014 ............................................................ 59 NBO Company Shares of Fortified/Functional Packaged Food: % Value 2010-2014 ........................................................................................ 59 LBN Brand Shares of Fortified/Functional Packaged Food: % Value 2011-2014 .................................................................................................. 60 LBN Brand Shares of Fortified/Functional Bread: % Value 2011-2014 ...... 61 Distribution of Fortified/Functional Packaged Food by Format: % Value 2009-2014 ........................................................................................ 62 Forecast Sales of Fortified/Functional Packaged Food by Category: Value 2014-2019 ........................................................................................ 62 Forecast Sales of Fortified/Functional Packaged Food by Category: % Value Growth 2014-2019 ........................................................................... 64

Naturally Healthy Beverages in Malaysia - Category analysis.................................................... 66 Headlines ................................................................................................................................... 66 Trends ........................................................................................................................................ 66 Competitive Landscape .............................................................................................................. 67 Prospects ................................................................................................................................... 67 Category Data ............................................................................................................................ 68 Table 67 Table 68 Table 69 Table 70 Table 71 Table 72 Table 73

Sales of NH Beverages by Category: Value 2009-2014............................. 68 Sales of NH Beverages by Category: % Value Growth 2009-2014 ............ 69 NBO Company Shares of NH Beverages: % Value 2010-2014 ................. 69 LBN Brand Shares of NH Beverages: % Value 2011-2014 ........................ 70 Distribution of NH Beverages by Format: % Value 2009-2014 ................... 71 Forecast Sales of NH Beverages by Category: Value 2014-2019 .............. 72 Forecast Sales of NH Beverages by Category: % Value Growth 20142019 ........................................................................................................... 73

Naturally Healthy Packaged Food in Malaysia - Category analysis............................................ 74 Headlines ................................................................................................................................... 74 Trends ........................................................................................................................................ 74 Competitive Landscape .............................................................................................................. 75 Prospects ................................................................................................................................... 75 Category Data ............................................................................................................................ 76 Table 74

Sales of NH Packaged Food by Category: Value 2009-2014..................... 76

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Table 75 Table 76 Table 77 Table 78 Table 79 Table 80

Sales of NH Packaged Food by Category: % Value Growth 20092014 ........................................................................................................... 77 NBO Company Shares of NH Packaged Food: % Value 2010-2014 ......... 78 LBN Brand Shares of NH Packaged Food: % Value 2011-2014 ................ 79 Distribution of NH Packaged Food by Format: % Value 2009-2014 ........... 80 Forecast Sales of NH Packaged Food by Category: Value 2014-2019 ...... 80 Forecast Sales of NH Packaged Food by Category: % Value Growth 2014-2019 .................................................................................................. 81

Organic Beverages in Malaysia - Category analysis .................................................................. 83 Trends ........................................................................................................................................ 83 Organic Packaged Food in Malaysia - Category analysis .......................................................... 84 Headlines ................................................................................................................................... 84 Trends ........................................................................................................................................ 84 Competitive Landscape .............................................................................................................. 85 Prospects ................................................................................................................................... 85 Category Data ............................................................................................................................ 86 Table 81 Table 82 Table 83 Table 84 Table 85 Table 86 Table 87

Sales of Organic Packaged Food by Category: Value 2009-2014 ............. 86 Sales of Organic Packaged Food by Category: % Value Growth 20092014 ........................................................................................................... 86 NBO Company Shares of Organic Packaged Food: % Value 20102014 ........................................................................................................... 87 LBN Brand Shares of Organic Packaged Food: % Value 2011-2014 ........ 87 Distribution of Organic Packaged Food by Format: % Value 20092014 ........................................................................................................... 88 Forecast Sales of Organic Packaged Food by Category: Value 20142019 ........................................................................................................... 88 Forecast Sales of Organic Packaged Food by Category: % Value Growth 2014-2019 ..................................................................................... 89

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HEALTH AND WELLNESS IN MALAYSIA - INDUSTRY OVERVIEW EXECUTIVE SUMMARY Health and Wellness Packaged Food and Beverages Sales Continue To Increase Health and wellness packaged food and beverages continue to grow in popularity due to rising consumer health awareness. In addition, consumers are also being influenced by several initiatives organised by government and non-governmental organisations to promote healthy lifestyle practises, with programmes including health screening, fitness workshops, health exhibitions and road shows.

Rising Health Awareness Continues To Drive Sales Demand for health and wellness packaged food and beverages continues to rise due to increasing consumer health awareness and the growing number of people suffering from health issues. The rise in the number of people suffering from obesity, high cholesterol, heart-related diseases and non-communicable diseases has resulted in consumers purchasing more healthy packaged food and beverages. Consumers tend to purchase reduced sugar beverages and fortified/functional packaged food to stay healthy.

Power Root Leads Sales in 2014 Power Root continued to lead sales in 2014 due to its wide product range, which is offered within most channels, and investment in aggressive marketing support. The company organised two cash contests for its RTD coffee and instant regular coffee and organised aggressive media advertisements to promote these cash contests. As a result, many consumers were attracted to participate and grab the chance to win cash from daily, weekly and monthly lucky draws.

Hypermarkets and Supermarkets Remain Ideal Distribution Channels in 2014 Consumers tend to purchase health and wellness packaged food and non-alcoholic drinks through hypermarkets and supermarkets. This is because these channels are widely located near neighbourhoods and working areas and offer a high level of convenience. In addition, consumers can compare prices, brands and analyse healthy ingredient content as these channels offer wide ranges of health and wellness packaged food and non-alcoholic drinks.

Outlook for Health and Wellness Packaged Food Remains Optimistic Health and wellness packaged food and non-alcoholic drinks will continue to record strong growth over the forecast period due to rising consumer health awareness. Packaged food and non-alcoholic drinks that help to reduce cholesterol, diabetes and weight as well as maintain good health conditions are expected to perform particularly well over the coming years.

KEY TRENDS AND DEVELOPMENTS

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Hypermarkets and Supermarkets Lead Distribution Hypermarkets and supermarkets continue to be used by large players to offer health and wellness food and beverages. While a growing number of internet retailers such as Babyland Malaysia, Antidote Health Store and Lohas are selling health and wellness food and beverages, most consumers continue to make purchases in hypermarkets as they like to be able to analyse ingredients on packaging as well as choose and compare various brands. Sales of health and wellness food and beverages via the direct selling channel remain limited in Malaysia. High-end hypermarket Sam Groceria opened a retail outlet in Sarawak during 2014 after its successful expansion into Kuala Lumpur and Pulau Pinang. Consumers who shop in hypermarkets and supermarkets can afford expensive health and wellness food and beverages as they normally come from medium to high income groups. Sam Groceria is an example of a hypermarket that is penetrating the high-end market and targeting consumers who are more quality rather than value conscious. Other than Sam Groceria, hypermarkets like Cold Storage, Tesco and Aeon Big are also offering wide ranges of healthy food and beverages such as organic baby food, reduced sugar instant coffee, reduced sugar RTD tea, reduced sugar Asian speciality drinks, organic soy drinks, organic soy milk, naturally healthy high fibre biscuits and fortified/functional biscuits. For instance, Tesco offers wide ranges of healthy food and beverages such as stevia liquid concentrates from Magic Taste Syrups Marketing, Montea stevia from Kong Woon Fong Tea Merchants, reduced fat and sugar yoghurts like Dutch Lady and Nestlé yoghurt and low calorie carbonates like Coca-Cola. Aeon Big offers wide ranges of healthy products, especially organic products from brands like Country Farms, which offers wide ranges of products such as juice, spreads, bakery, noodles, sauces and dressings. These products are found within most Aeon Big outlets across all states in Malaysia. Special shelves are occupied by these organic products within all Aeon Big outlets in Malaysia, with examples of healthy products from Country Farms including honey, cereals, juice, soy drinks and soy milk. In addition, these organic products are certified by various governmental bodies like USDA Organic, Organic Malaysia, Organic Alliance Malaysia, OCIA, Eco Cert and Bioland. Furthermore, hypermarkets and supermarkets are also offering attractive price discounts such as ‘buy two at a lower price’ or bundle sales. Outlook Modern grocery retail outlets like hypermarkets and supermarkets remain the ideal choices for consumers to purchase healthy packaged food and non-alcoholic drinks because consumers can easily compare each brand and price. As a result, manufacturers tend to offer wider ranges of healthy foods and beverages to modern grocery retail outlets. On the other hand, hypermarkets like Mydin Mohamed Holdings plan to expand into Kuching, Sarawak, by 2015 after successfully opening Sam Groceria hypermarkets in Pulau Pinang and Kuala Lumpur. In addition, companies will look to organise more marketing campaigns in order to let consumers understand more about the benefits of healthy products and also to create brand awareness. Media advertising, road shows and competitions which test consumers’ knowledge about nutritional value information are examples of events that companies can organise over the forecast period. Marketing campaigns like price discounts and bundle sales are likely to be used frequently by manufacturers since consumers perceive healthy products as being expensive or premium. In addition, by consuming more healthy food and beverages, consumers will be more understanding about the nutritional values of packaged food and beverages.

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Growing Number of General Wellbeing Packaged Food and Nonalcoholic Drinks Consumers are becoming increasingly health conscious, with the increasing number of people suffering from obesity, heart disease and diabetes driving demand for healthier products. In addition, it is more and more common to find multivitamins, minerals and calcium inside packaged food and non-alcoholic drinks. Furthermore, many packaged foods now state that they contain multivitamins, minerals and calcium (eg cheeses, biscuits, dried baby food, milk products, yoghurts and snack bars) while non-alcoholic drinks like natural mineral bottled water, juice and concentrates are also offering multivitamins, minerals and calcium. Manufacturers are introducing healthier ingredients to attract consumers as these ingredients are commonly known by consumers. In response to rising health awareness, consumers are introducing more added multivitamins, minerals and calcium. In addition, the unit selling price of these packaged food and non-alcoholic drinks with added healthy ingredients is cheaper than organic and naturally healthy packaged food and non-alcoholic drinks. This is because it is cheaper to produce general wellbeing products rather than organic and naturally healthy products. Furthermore, non-governmental organisations and government bodies have organised several campaigns to educate consumers on the importance of nutritional values – a development which has also encouraged consumers to become more interested in general wellbeing. Health screenings for cholesterol and diabetes, workshops for dancing activities, road shows, health exhibitions and fitness workshops are being organised by government supported non-government organisations to encourage Malaysians to live more healthily. Outlook Over the forecast period, it is expected that a growing number of general wellbeing packaged food and non-alcoholic drinks products will be introduced. In order to attract consumers, manufacturers will look to organise aggressive marketing campaigns such as competitions, cash contests, price discounts and sponsorship events. Nonetheless, manufacturers will also look to introduce other healthy products which contain healthy ingredients that offer weight management, immune support, cardiovascular health and bone and joint health properties. The aggressive introduction of new healthy ingredients can help to boost company sales and market shares. In addition, companies will also look to expand to other areas since consumers are well-aware of the general wellbeing advantages of products in this area. The availability of healthy products - other than general wellbeing ones such as beauty from within, immune support, bone and joint health offerings - remains limited. As a result, there is scope for future growth for healthy food and beverages and manufacturers will look to explore these areas more over the coming years. In order to introduce more healthy products, companies will need to organise marketing campaigns to educate consumers. For instance, media advertisements, road shows, social media sites and contests can all be used to spread information to as many people as possible.

Rising Consumer Health and Wellness Awareness Malaysia has one of the highest obesity rates in Asia according to the British medical journal. People who are obese are more likely to suffer from diseases like diabetes and heart-related problems. In addition, the Science Advisor to the Prime Minister indicated that obesity rates and the incidence of diabetes and heart disease is rising among Malaysians. As a result, the Ministry of Health organised a number of public health campaigns. For instance, during May 2014, the Ministry organised campaigns to promote healthy lifestyles

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among children and adults in response to the rise in the incidence of non-communicable diseases and psychiatric and diabetes related problems among children and younger people. The Ministry of Health aims to increase awareness of the importance of ensuring younger people lead a healthy lifestyle. Furthermore, other healthy sports events organised by non-governmental organisations and government agencies included Star Walk 2014, Cycling campaign, Penang Bridge International Marathon 2014 and running competitions in most states. On the other hand, consumers are also influenced by social media, media advertisements, the printed media and education, which drove consumers to become more aware of the importance of healthy lifestyle practises. Consumers are increasingly purchasing healthy products at hypermarkets and supermarkets like high fibre biscuits, high calcium cheese, reduced sugar instant regular coffee, and organic packaged food like cereals and soy drinks. In addition, consumers also tend to be careful in terms of choosing healthy products by comparing brands, ingredient content and also labelling which clearly states any organic certification on packaging. Outlook Over the forecast period, the obesity rate is expected to continue growing in Malaysia. Consumers tend to eagerly search for healthy food and beverages in order to prevent potential diseases such as diabetes, heart-related diseases and high blood pressure or high cholesterol level. As a result, manufacturers must invest more in research and development to introduce more health packaged food and beverages. In addition, companies and government agencies need to educate consumers on the importance of living healthily in order to create alerts among consumers. For instance, companies and government agencies can spread information about healthy living via social media, media advertisements, road shows, competitions, sports events and educational institutions. Furthermore, the government aims to promote the importance of nutritional values among Malaysian consumers by forming the National Plan of Action for Nutrition of Malaysia from 2006 to 2015. The objective of promoting nutritional values among young children, adults and the elderly is to encourage them to eat healthily. The National Plan of Action on Nutrition was formed to increase nutritional wellbeing knowledge among Malaysians. As a result, food and nutrition programmes are set to promote nutritional wellbeing and to be supported by healthy lifestyle campaigns. Furthermore, companies can also organise more marketing campaigns like healthy loyalty programmes which offer discounts on purchases of healthy products. Also, other marketing initiatives include price discounts, bundle sales, lower prices and free samples. Such tactics help to boost sales in this area as consumers perceive healthy products as being more premium and costly than regular packaged food and beverages. As a result, such marketing campaigns can gain more attention by helping consumers better understand the importance of nutritional values and healthy products.

MARKET DATA Table 1

Sales of Health and Wellness by Type: Value 2009-2014

MYR million

-- Better For You (BFY) -- Food Intolerance

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2009

2010

2011

2012

2013

2014

380.7 13.3

396.8 13.8

410.2 14.2

424.6 14.7

435.4 15.2

456.6 15.6

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-- Fortified/Functional (FF) -- Naturally Healthy (NH) -- Organic Health and Wellness by Type Source:

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4,960.9

5,456.5

5,896.7

6,388.5

6,938.4

7,512.0

1,427.4 10.0 6,792.3

1,495.2 10.6 7,373.0

1,572.5 11.4 7,905.0

1,656.3 12.0 8,496.1

1,735.1 12.9 9,136.9

1,809.4 13.8 9,807.5

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Table 2

Sales of Health and Wellness by Type: % Value Growth 2009-2014

% current value growth

-- Better For You (BFY) -- Food Intolerance -- Fortified/Functional (FF) -- Naturally Healthy (NH) -- Organic Health and Wellness by Type Source:

2013/14

2009-14 CAGR

2009/14 Total

4.9 3.1 8.3 4.3 7.3 7.3

3.7 3.3 8.7 4.9 6.6 7.6

19.9 17.7 51.4 26.8 37.5 44.4

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Table 3

Sales of Health and Wellness by Category: Value 2009-2014

MYR million

HW Beverages - HW Hot Drinks - HW Soft Drinks HW Packaged Food - HW Baby Food - HW Bakery - HW Confectionery - HW Dairy - HW Ice Cream - HW Meal Replacement - HW Noodles - HW Oils and Fats - HW Pasta - HW Ready Meals - HW Rice and Dessert Mixes - HW Sauces, Dressings and Condiments - HW Snack Bars - HW Soup - HW Spreads - HW Sweet and Savoury Snacks - HW Canned/Preserved Food Excluding Ready Meals, Soup and Pasta - HW Chilled Processed Meats, Fish/Seafood and Lunch Kit

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2010

2011

2012

2013

2014

2,438.2 877.5 1,560.7 4,354.1 1,135.5 622.1 250.3 1,107.7 288.6 328.8 -

2,638.1 914.7 1,723.4 4,734.9 1,225.2 644.4 260.5 1,199.1 380.6 385.5 -

2,826.4 955.1 1,871.3 5,078.6 1,297.3 672.8 269.8 1,301.2 468.4 398.0 -

3,034.3 989.4 2,044.9 5,461.8 1,377.5 708.6 278.8 1,403.7 576.7 411.1 -

3,261.3 1,027.3 2,234.0 5,875.6 1,466.5 744.4 287.4 1,505.5 714.9 425.5 -

3,510.1 1,069.2 2,440.9 6,297.4 1,563.1 766.3 295.9 1,599.2 875.5 441.1 -

-

-

-

-

-

-

7.1 26.9 271.9

7.4 28.9 277.1

7.7 30.7 280.8

7.9 32.6 286.6

8.2 34.8 291.4

8.4 37.0 295.3

-

-

-

-

-

-

-

-

-

-

-

-

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- HW Frozen Processed Food Excluding Ready Meals, Pizza, Soup and Noodles Health and Wellness by Category Source:

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-

-

-

-

-

-

6,792.3

7,373.0

7,905.0

8,496.1

9,136.9

9,807.5

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Table 4

Sales of Health and Wellness by Category: % Value Growth 2009-2014

% current value growth

HW Beverages - HW Hot Drinks - HW Soft Drinks HW Packaged Food - HW Baby Food - HW Bakery - HW Confectionery - HW Dairy - HW Ice Cream - HW Meal Replacement - HW Noodles - HW Oils and Fats - HW Pasta - HW Ready Meals - HW Rice and Dessert Mixes - HW Sauces, Dressings and Condiments - HW Snack Bars - HW Soup - HW Spreads - HW Sweet and Savoury Snacks - HW Canned/Preserved Food Excluding Ready Meals, Soup and Pasta - HW Chilled Processed Meats, Fish/ Seafood and Lunch Kit - HW Frozen Processed Food Excluding Ready Meals, Pizza, Soup and Noodles Health and Wellness by Category Source:

2013/14

2009-14 CAGR

2009/14 Total

7.6 4.1 9.3 7.2 6.6 2.9 2.9 6.2 22.5 3.7 2.8 6.4 1.3 -

7.6 4.0 9.4 7.7 6.6 4.3 3.4 7.6 24.9 6.1 3.3 6.6 1.7 -

44.0 21.8 56.4 44.6 37.7 23.2 18.2 44.4 203.4 34.1 17.7 37.3 8.6 -

-

-

-

-

-

-

7.3

7.6

44.4

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Table 5

Sales of Health and Wellness by Prime Positioning: Value 2009-2014

MYR million

Beauty From Within Bone and Joint Health Brain Health and Memory Cardiovascular Health Digestive Health Endurance Energy Boosting Food Intolerance

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2009

2010

2011

2012

2013

2014

27.0 10.8 3.1 560.2 539.2 176.3 13.3

34.0 11.2 3.3 601.3 622.0 183.2 13.8

36.1 11.6 3.5 664.2 710.4 187.0 14.2

37.3 12.1 3.7 726.8 816.9 192.6 14.7

38.7 12.6 4.0 786.2 934.5 198.8 15.2

40.5 13.1 4.2 826.1 1,065.3 205.6 15.6

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General Wellbeing Immune Support Oral and Respiratory Health Urinary Tract Health Vision Health Weight Management Health and Wellness by Prime Positioning Source:

Passport

4,662.6 188.8

4,991.3 196.9

5,261.0 204.2

5,550.0 210.8

5,852.9 217.2

6,158.0 223.7

610.9 6,792.3

716.0 7,373.0

812.8 7,905.0

931.1 8,496.1

1,076.9 9,136.9

1,255.3 9,807.5

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Table 6

Sales of Health and Wellness by Prime Positioning: % Value Growth 20092014

% current value growth

Beauty From Within Bone and Joint Health Brain Health and Memory Cardiovascular Health Digestive Health Endurance Energy Boosting Food Intolerance General Wellbeing Immune Support Oral and Respiratory Health Urinary Tract Health Vision Health Weight Management Health and Wellness by Prime Positioning Source:

2013/14

2009-14 CAGR

2009/14 Total

4.5 4.4 6.4 5.1 14.0 3.4 3.1 5.2 3.0 16.6 7.3

8.4 4.0 6.2 8.1 14.6 3.1 3.3 5.7 3.5 15.5 7.6

49.8 21.6 35.0 47.5 97.6 16.6 17.7 32.1 18.5 105.5 44.4

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Table 7

NBO Company Shares of Health and Wellness: % Value 2010-2014

% retail value rsp Company Nestlé (Malaysia) Bhd Fraser & Neave Holdings Bhd Dutch Lady Milk Industries Bhd Herbalife Products (M) Sdn Bhd Danone Dumex (M) Sdn Bhd Yeo Hiap Seng (M) Bhd Malaysia Milk Sdn Bhd Fonterra Brands (M) Sdn Bhd Power Root (M) Sdn Bhd Bristol-Myers Squibb (M) Sdn Bhd GlaxoSmithKline

© Euromonitor International

2010

2011

2012

2013

2014

14.2 10.9

13.9 11.0

13.4 11.5

12.6 11.8

12.2 12.2

7.0

7.0

7.0

7.2

7.2

2.8

3.2

4.0

4.8

5.8

4.9 4.2 3.7 3.0

4.9 4.2 3.8 2.9

4.8 4.2 3.9 2.9

5.0 4.2 3.9 2.8

5.0 4.1 3.8 2.8

2.7 2.1

2.7 2.2

2.6 2.3

2.5 2.4

2.5 2.4

2.5

2.4

2.3

2.4

2.3

7

HEALTH AND W ELLNESS IN MALAYSIA

Consumer Healthcare Sdn Bhd Lam Soon (M) Bhd Nu Skin (M) Sdn Bhd Mondelez (M) Sales Sdn Bhd Ace Canning Corp Sdn Bhd Gardenia Bakery KL Sdn Bhd Spritzer Bhd Abbott Laboratories (M) Sdn Bhd Italian Baker Sdn Bhd, The TC Pharmaceutical Industry Co Ltd Permanis Sdn Bhd Yakult (M) Sdn Bhd Barkath Co-Ro Mfg Sdn Bhd Wyeth (M) Sdn Bhd Tong Garden Snack Foods Sdn Bhd Quaker Products (M) Sdn Bhd Coca-Cola Bottlers (M) Sdn Bhd Stanson Bakeries Sdn Bhd Amway (M) Sdn Bhd Kellogg Asia Marketing Inc Kraft Foods (M) Sdn Bhd Others Total

Passport

2.0 1.3 -

2.0 1.7 -

2.0 1.8 -

2.1 1.9 1.9

2.1 2.1 1.9

1.9 2.7

1.9 2.6

1.9 1.6

1.8 1.7

1.7 1.6

1.6 1.6

1.6 1.6

1.6 1.5

1.6 1.6

1.6 1.6

-

0.2

1.3

1.5

1.5

1.4

1.4

1.3

1.3

1.2

1.3 0.7 1.0 0.9 0.9

1.3 0.9 0.9 0.9 0.8

1.3 0.9 0.9 0.9 0.8

1.2 0.9 0.9 0.8 0.8

1.2 0.9 0.9 0.8 0.7

0.7

0.7

0.6

0.6

0.6

-

0.5

0.5

0.5

0.6

1.2 0.3 0.4

1.1 0.3 0.4

1.0 0.3 0.4

0.7 0.4 0.4

0.6 0.4 0.3

2.1 20.1 100.0

2.1 19.2 100.0

2.0 18.4 100.0

17.8 100.0

17.3 100.0

Source:

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Table 8

LBN Brand Shares of Health and Wellness: % Value 2011-2014

% retail value rsp Brand 100 Plus Dutch Lady Milo Herbalife Dumex Yeo's Naturel Pharmanex Vitagen Gardenia Lactogen Alicafé Drinho Massimo Anlene

© Euromonitor International

Company Fraser & Neave Holdings Bhd Dutch Lady Milk Industries Bhd Nestlé (Malaysia) Bhd Herbalife Products (M) Sdn Bhd Danone Dumex (M) Sdn Bhd Yeo Hiap Seng (M) Bhd Lam Soon (M) Bhd Nu Skin (M) Sdn Bhd Malaysia Milk Sdn Bhd Gardenia Bakery KL Sdn Bhd Nestlé (Malaysia) Bhd Power Root (M) Sdn Bhd Ace Canning Corp Sdn Bhd Italian Baker Sdn Bhd, The Fonterra Brands (M) Sdn

2011

2012

2013

2014

7.8

8.4

9.0

9.6

6.8

6.8

7.0

7.1

7.8 3.2

7.5 4.0

7.2 4.8

6.9 5.8

4.3 3.6 2.0 1.7 1.8 2.6 1.8 1.6 1.7 0.2 1.6

4.2 3.6 2.0 1.8 1.9 1.6 1.7 1.6 1.6 1.3 1.6

4.4 3.6 2.1 1.9 2.0 1.7 1.7 1.6 1.6 1.5 1.5

4.5 3.6 2.1 2.1 1.9 1.6 1.6 1.6 1.5 1.5 1.5

8

HEALTH AND W ELLNESS IN MALAYSIA

Bhd Nestlé (Malaysia) Bhd Spritzer Bhd

Nestlé Spritzer Natural Mineral Water Ribena

GlaxoSmithKline Consumer Healthcare Sdn Bhd TC Pharmaceutical Industry Co Ltd Malaysia Milk Sdn Bhd GlaxoSmithKline Consumer Healthcare Sdn Bhd Bristol-Myers Squibb (M) Sdn Bhd Yakult (M) Sdn Bhd Barkath Co-Ro Mfg Sdn Bhd Fonterra Brands (M) Sdn Bhd Tong Garden Snack Foods Sdn Bhd Malaysia Milk Sdn Bhd Permanis Sdn Bhd Nestlé (Malaysia) Bhd Quaker Products (M) Sdn Bhd Kraft Foods (M) Sdn Bhd

Red Bull Marigold Horlicks

Enfagrow Yakult Sunquick Anmum Tong Garden Peel Fresh 7-Up Revive Nespray Quaker Jacob's Others Total Source:

Passport

1.4 1.2

1.4 1.3

1.5 1.3

1.5 1.3

1.2

1.1

1.2

1.2

1.4

1.3

1.3

1.2

1.3 1.2

1.2 1.2

1.2 1.1

1.2 1.1

0.9

0.9

1.0

1.0

0.9 0.9 0.8

0.9 0.9 0.8

0.9 0.9 0.8

0.9 0.9 0.8

0.8

0.8

0.8

0.7

0.7 0.5 0.7 0.7

0.7 0.6 0.6 0.6

0.7 0.6 0.6 0.6

0.7 0.6 0.6 0.6

0.7 36.4 100.0

0.6 35.1 100.0

33.8 100.0

32.7 100.0

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Table 9

Distribution of Health and Wellness by Format: % Value 2009-2014

% retail value rsp

Store-Based Retailing - Grocery Retailers -- Modern Grocery Retailers --- Convenience Stores --- Discounters --- Forecourt Retailers --- Hypermarkets --- Supermarkets -- Traditional Grocery Retailers --- Food/drink/tobacco specialists --- Independent Small Grocers -- Other Grocery Retailers - Non-Grocery Specialists Non-Store Retailing - Vending - Homeshopping - Internet Retailing

© Euromonitor International

2009

2010

2011

2012

2013

2014

95.9 95.4 77.5

95.1 94.6 77.3

94.4 93.9 76.7

93.7 93.1 76.2

93.5 92.9 75.9

93.4 92.8 76.0

5.6 2.0 47.6 22.3 16.3

5.3 1.8 47.7 22.5 15.8

5.0 1.5 47.7 22.6 15.6

4.5 1.1 47.8 22.7 15.5

4.2 1.1 47.8 22.8 15.6

4.2 1.2 47.8 22.8 15.5

-

-

-

-

-

-

16.3

15.8

15.6

15.5

15.6

15.5

1.6

1.6

1.5

1.5

1.4

1.4

0.5 4.1 0.6 0.1

0.5 4.9 0.6 0.2

0.5 5.6 0.6 0.2

0.6 6.3 0.6 0.2

0.6 6.5 0.6 0.2

0.6 6.6 0.6 0.3

9

HEALTH AND W ELLNESS IN MALAYSIA

- Direct Selling Total Source:

Passport

3.4 100.0

4.1 100.0

4.7 100.0

5.5 100.0

5.7 100.0

5.7 100.0

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Table 10

Distribution of Health and Wellness by Format and Category: % Value 2014

% retail value rsp

Store-Based Retailing - Grocery Retailers -- Modern Grocery Retailers --- Convenience Stores --- Discounters --- Forecourt Retailers --- Hypermarkets --- Supermarkets -- Traditional Grocery Retailers --- Food/drink/tobacco specialists --- Independent Small Grocers -- Other Grocery Retailers - Non-Grocery Specialists Non-Store Retailing - Vending - Homeshopping - Internet Retailing - Direct Selling Total Source:

Better For You (BFY)

Food Intolerance

Fortified/ Functional (FF)

Naturally Healthy (NH)

Organic

99.3 99.3 83.4

100.0 93.8 84.6

91.8 91.0 73.6

98.9 98.9 84.0

94.1 94.1 51.6

4.4 0.0 0.9 55.8 22.3 12.7

3.5 0.0 0.0 55.5 25.6 4.8

3.9 0.0 1.3 46.0 22.4 16.1

5.5 0.0 0.6 53.1 24.7 13.7

0.0 0.0 0.0 30.6 21.0 0.0

0.0

0.0

0.0

0.0

0.0

12.7

4.8

16.1

13.7

0.0

3.2

4.4

1.2

1.3

42.5

0.0 0.7 0.6 0.0 0.0 0.0 100.0

6.2 0.0 0.0 0.0 0.0 0.0 100.0

0.8 8.2 0.5 0.0 0.3 7.5 100.0

0.0 1.1 1.0 0.0 0.1 0.0 100.0

0.0 5.9 0.0 0.0 5.9 0.0 100.0

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Table 11

Forecast Sales of Health and Wellness by Type: Value 2014-2019

MYR million

-- Better For You (BFY) -- Food Intolerance -- Fortified/Functional (FF) -- Naturally Healthy (NH) -- Organic Health and Wellness by Type Source:

2014

2015

2016

2017

2018

2019

456.6 15.6 7,512.0

466.4 15.8 7,954.5

476.7 15.9 8,425.2

487.0 16.0 8,905.6

496.8 16.1 9,403.2

506.1 16.2 9,914.8

1,809.4 13.8 9,807.5

1,838.9 14.4 10,290.0

1,867.3 15.0 10,800.1

1,898.1 15.5 11,322.3

1,930.6 16.0 11,862.7

1,964.4 16.4 12,418.0

Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources

© Euromonitor International

10

HEALTH AND W ELLNESS IN MALAYSIA

Table 12

Passport

Forecast Sales of Health and Wellness by Type: % Value Growth 2014-2019

% constant value growth

-- Better For You (BFY) -- Food Intolerance -- Fortified/Functional (FF) -- Naturally Healthy (NH) -- Organic Health and Wellness by Type Source:

2014/2015

2014-19 CAGR

2014/19 TOTAL

1.9 0.5 5.4 1.7 2.7 4.7

2.1 0.7 5.7 1.7 3.5 4.8

10.8 3.3 32.0 8.6 19.0 26.6

Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources

Table 13

Forecast Sales of Health and Wellness by Category: Value 2014-2019

MYR million

HW Beverages - HW Hot Drinks - HW Soft Drinks HW Packaged Food - HW Baby Food - HW Bakery - HW Confectionery - HW Dairy - HW Ice Cream - HW Meal Replacement - HW Noodles - HW Oils and Fats - HW Pasta - HW Ready Meals - HW Rice and Dessert Mixes - HW Sauces, Dressings and Condiments - HW Snack Bars - HW Soup - HW Spreads - HW Sweet and Savoury Snacks - HW Canned/Preserved Food Excluding Ready Meals, Soup and Pasta - HW Chilled Processed Meats, Fish/Seafood and Lunch Kit - HW Frozen Processed Food Excluding Ready Meals, Pizza, Soup and Noodles Health and Wellness by Category Source:

2014

2015

2016

2017

2018

2019

3,510.1 1,069.2 2,440.9 6,297.4 1,563.1 766.3 295.9 1,599.2 875.5 441.1 -

3,684.7 1,087.2 2,597.5 6,605.3 1,630.0 775.6 297.1 1,663.9 1,030.6 446.6 -

3,872.8 1,109.0 2,763.8 6,927.3 1,705.0 783.6 298.0 1,731.9 1,191.1 452.9 -

4,067.4 1,132.1 2,935.3 7,254.9 1,784.8 790.8 299.1 1,803.0 1,348.8 460.7 -

4,266.6 1,157.8 3,108.8 7,596.1 1,866.9 797.0 300.3 1,876.8 1,515.7 469.4 -

4,470.6 1,186.1 3,284.5 7,947.4 1,953.7 802.2 301.6 1,952.8 1,686.6 479.6 -

-

-

-

-

-

-

8.4 37.0 295.3

8.5 38.4 290.7

8.5 39.8 285.1

8.6 41.2 279.7

8.6 42.6 274.6

8.7 44.0 268.7

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

9,807.5

10,290.0

10,800.1

11,322.3

11,862.7

12,418.0

Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources

© Euromonitor International

11

HEALTH AND W ELLNESS IN MALAYSIA

Table 14

Passport

Forecast Sales of Health and Wellness by Category: % Value Growth 20142019

% constant value growth

HW Beverages - HW Hot Drinks - HW Soft Drinks HW Packaged Food - HW Baby Food - HW Bakery - HW Confectionery - HW Dairy - HW Ice Cream - HW Meal Replacement - HW Noodles - HW Oils and Fats - HW Pasta - HW Ready Meals - HW Rice and Dessert Mixes - HW Sauces, Dressings and Condiments - HW Snack Bars - HW Soup - HW Spreads - HW Sweet and Savoury Snacks - HW Canned/Preserved Food Excluding Ready Meals, Soup and Pasta - HW Chilled Processed Meats, Fish/ Seafood and Lunch Kit - HW Frozen Processed Food Excluding Ready Meals, Pizza, Soup and Noodles Health and Wellness by Category Source:

2014/2015

2014-19 CAGR

2014/19 TOTAL

4.8 2.4 5.7 4.6 4.7 0.7 0.4 4.1 11.3 2.2 0.4 3.3 -2.1 -

5.0 2.1 6.1 4.8 4.6 0.9 0.4 4.1 14.0 1.7 0.6 3.5 -1.9 -

27.4 10.9 34.6 26.2 25.0 4.7 1.9 22.1 92.7 8.7 3.2 19.0 -9.0 -

-

-

-

-

-

-

4.7

4.8

26.6

Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources

Table 15

Forecast Sales of Health and Wellness by Prime Positioning: Value 20142019

MYR million

Beauty From Within Bone and Joint Health Brain Health and Memory Cardiovascular Health Digestive Health Endurance Energy Boosting Food Intolerance General Wellbeing Immune Support Oral and Respiratory Health Urinary Tract Health Vision Health Weight Management Health and Wellness by Prime Positioning

© Euromonitor International

2014

2015

2016

2017

2018

2019

40.5 13.1 4.2 826.1 1,065.3 205.6 15.6 6,158.0 223.7

41.2 13.3 4.4 852.2 1,181.9 206.4 15.8 6,331.0 224.6

42.1 13.5 4.5 879.9 1,307.8 207.2 15.9 6,514.7 225.3

43.2 13.8 4.7 910.5 1,435.1 209.1 16.0 6,707.8 226.2

44.4 14.1 4.8 943.7 1,561.4 211.4 16.1 6,908.4 227.2

45.8 14.5 5.0 978.7 1,686.1 214.6 16.2 7,119.1 228.3

1,255.3 9,807.5

1,419.2 10,290.0

1,589.1 10,800.1

1,755.8 11,322.3

1,931.3 11,862.7

2,109.8 12,418.0

12

HEALTH AND W ELLNESS IN MALAYSIA

Source:

Passport

Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources

Table 16

Forecast Sales of Health and Wellness by Prime Positioning: % Value Growth 2014-2019

% constant value growth

Beauty From Within Bone and Joint Health Brain Health and Memory Cardiovascular Health Digestive Health Endurance Energy Boosting Food Intolerance General Wellbeing Immune Support Oral and Respiratory Health Urinary Tract Health Vision Health Weight Management Health and Wellness by Prime Positioning Source:

2014/2015

2014-19 CAGR

2014/19 TOTAL

3.1 2.5 3.0 3.7 8.0 1.5 0.5 3.0 0.5 9.2 4.7

2.5 2.0 3.4 3.4 9.6 0.9 0.7 2.9 0.4 10.9 4.8

13.0 10.4 18.2 18.5 58.3 4.4 3.3 15.6 2.0 68.1 26.6

Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources

APPENDIX National Legislation Food and beverages legislation in Malaysia centres on the fact that all products must be Halal certified in order to allow for consumption by Muslims. If companies or manufacturers produce non-Halal packaged food and beverages, they must be placed in non-Halal sections or state the fact clearly on packaging. On the other hand, HACCP System Certification is a food safety assurance system certified by the Ministry of Health Malaysia. This certification assurance is obtained in order to provide safe packaged food and beverages that consumers can have confidence in. On the other hand, organic food and beverages are certified by Organic Malaysia or other countries (eg USDA Organic or Non-GMO Project). Many organic packaged food and beverages are mainly certified by Organic Malaysia, USDA Organic and the Non-GMO Project, with USDA Organic and Non-GMO Project certified products being imported.

SOURCES Sources used during research included the following: Summary 1 Research Sources Official Sources

Department of Statistics Malaysia Cocoa Board Malaysia Industrial Development Authority

© Euromonitor International

13

HEALTH AND W ELLNESS IN MALAYSIA

Passport

National Statistics Institute Statistics.gov.my United States Department of Agriculture (USDA) Foreign Agricultural Service (FAS) Trade Associations

Asia Bottled Water Association International Bottled Water Association International Coffee Organisation International Council of Bottled Water Associations (ICBWA) International Federation of Fruit Juice Producers Malaysia Palm Oil Association Malaysian Cocoa Board Malaysian Palm Oil Board UNESDA & CISDA

Trade Press

Austrade Berita Harian Bernama Beverage Digest Beverage Net Beverage Today Beverage World BeverAsia Business Times Business Times, The Edge Daily, The Edge Malaysia, The Food for Thought Malay Mail Marketing & Brand Equity Marketing Interactive MyMetro New Age New Sabah Times New Straits Times Retail World Asia Soft Drinks International Star, The Sun, The

© Euromonitor International

14

HEALTH AND W ELLNESS IN MALAYSIA

Passport

Tea & Coffee Asia The Edge Daily The Marketing Interactive The Star Utusan Express Utusan Konsumer Source:

Euromonitor International

© Euromonitor International

15

HEALTH AND W ELLNESS IN MALAYSIA

Passport

HEALTH AND WELLNESS IN MALAYSIA - COMPANY PROFILES COUNTRY FARMS SDN BHD IN HEALTH AND WELLNESS (MALAYSIA) Strategic Direction  To remain the top player in the Malaysian organic industry over the forecast period, Country Farms Sdn Bhd is offering affordable and high-quality organic products in order to maintain consumer interest. Therefore the company decided to reduce prices by importing organic products in bulk and buying more from local organic farmers. Furthermore, it actively organises educational, promotional and awareness activities to educate consumers regarding the importance of eating and using organic products. For instance, it provides a series of informative articles regarding organic food, tips on healthy eating and nutrition, and also creative recipes.

Key Facts Summary 2 Country Farms Sdn Bhd: Key Facts Full name of company: Country Farms Sdn Bhd Address:

Unit-C2 Natco Industrial Park, Lot 9 Lorong Keluli 1B Seksyen 7, 40000 Shah Alam, Selangor, Malaysia.

Tel:

+603 3342 4401

Fax:

+603 3342 4404

www:

www.countryfarmorganics.com

Activities:

Manufacturing and retailing of organic products

Source:

Euromonitor International from company reports, company research, trade press, trade sources

Company Background  Country Farms Sdn Bhd was founded in 1998 to promote healthier living in today’s fast-paced world. It is a wholly-owned subsidiary of Malaysia’s Berjaya Group Berhad. Country Farms Sdn Bhd has a total of 20 Country Farm Organics (CFO) stores which are 16 outlets in Malaysia and four outlets in Singapore. Country Farms’ products are also available in major local supermarkets or international hypermarkets such as AEON, AEON BIG, Tesco, Cold Storage, Village Grocer, Jaya Grocer, etc.  Country Farms has become one of the leading players in the local organics industry by promoting and offering affordable, high-quality certified organic or 100% natural products. Other than fresh vegetables, fruit and processed food, it also offers skin care, baby care, household products and healthcare supplements.

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16

HEALTH AND W ELLNESS IN MALAYSIA

Passport

 In July 2013 Country Farm Organics (CFO) upgraded its packaging facilities from HACCP certification to ISO 20000:2005. At the same time the packaging plant in Shah Alam was certified by MOODY International in the repacking of organic and natural food products.

Competitive Positioning  In order to maintain its position as the leader within the organic industry in Malaysia, Country Farms Sdn Bhd provides a wide range of products under different brands, for instance Nature’s Gate for personal care, NQ Organic for coffee, Native Organic for hot chocolate, CF Organic for breakfast cereals, oats and brans, etc. Country Farms Sdn Bhd focuses on brandbuilding and endorsement programmes which can yield a good performance, such as enhancing brand loyalty and awareness among consumers. Its slogan is “Think Organic, Think Country Farm”.  Country Farms Sdn Bhd has always introduced new product categories or new products for existing categories in order to enhance its competitive advantage and cater to different consumer needs. For example, it recently launched salt as a new category in functional food. The new product – NQ 120/80 Symbiosal – is without MSG and anti-caking agents, targeting the rising number of health-conscious consumers.  Country Farms Sdn Bhd gives special attention to checking the origin of each product to ensure that it is truly certified organic. Furthermore, the organic certificates of such products are placed in the outlets, allowing customers to inspect them should they wish to. The company wishes to remain transparent so that it can maintain its reputation. Summary 3 Product Type

Country Farms Sdn Bhd: Competitive Position 2014 Value Share (%) Rank

Organic soy milk Source:

1.3

5

Euromonitor International from company reports, company research, trade press, trade sources, trade interviews

MALAYSIA MILK SDN BHD IN HEALTH AND WELLNESS (MALAYSIA) Strategic Direction  Malaysia Milk aims to maximise its operations by distributing to as many retail outlets as possible and maintaining product quality and taste. The company faces the challenge of limited chiller facilities in most modern and traditional grocery retail outlets, with only limited amounts of products being able to be stored in these channels. As a result, Malaysia Milk plans to adopt a co-investment tactic to help retailers provide more chiller facilities at its retail outlets to keep products fresh and maintain quality and taste.

Key Facts Summary 4 Malaysia Milk Sdn Bhd: Key Facts Full name of company: Malaysia Milk Sdn Bhd

© Euromonitor International

17

HEALTH AND W ELLNESS IN MALAYSIA

Passport

Address:

No. 7, Jalan 19/1, 46300, Petaling Jaya, Malaysia

Tel:

+60 (3) 7955 4388

www:

www.mmsb.com.my

Activities:

Manufacture, distribution and sales of packaged food and non-alcoholic drinks like sweetened condensed milk, evaporated milk, UHT milk, juices and Asian drinks, pasteurised milk, cultured milk, soft yoghurt, yoghurt drink, jelly and pudding.

Source:

Euromonitor International from company reports, company research, trade press, trade sources

Company Background  Malaysia Milk was formed in 1969 under Malaysia Dairy Industries. Malaysia Dairy Industries was established in 1963 as a joint venture between Singaporean partners and the Australian Dairy Produce Board. However, in 1969 the Singaporean partners bought the Australian equity, with Malaysia Dairy Industries becoming completely localised.  The company has become the leading dairy and beverage player in Malaysia with annual sales revenue of MYR600 million. The core business of the company is the manufacturing and distribution of a range of products in different segments like sweetened condensed milk, evaporated milk, UHT milk, juices and Asian drinks, pasteurised milk, juices, cultured milk, soft yoghurt, yoghurt drink, jelly and pudding.  The company has several regional offices in northern regions (Pulau Pinang, Alor Setar, Sungai Petani, Butterworth), central 1 (Petaling Jaya, Negeri Sembilan, Pahang), central 2 ( Ipoh, Sitiawan), southern region (Johor Bahru, Batu Pahat, Muar, Malacca), East Coast region (Kota Bharu, Kuantan, Kuala Terengganu) and East Malaysia region ( Kota Kinabalu, Miri, Kuching). Other than the domestic market, the company also exports 90% of its products (eg sweetened condensed milk and evaporated milk) to more than 50 countries globally.

Competitive Positioning  The company ranked ninth within health and wellness beverages in 2014 with a value share of 3%.  Malaysia Milk recorded stagnating growth in health and wellness beverages in 2014 due to a lack of marketing support in the form of media advertisements, price discount promotions and road shows.  The company is positioned in more mature and less dynamic areas of health and wellness beverages due to its long establishment in Malaysia and wide distribution channels. In addition, brand names like Marigold, Peel Fresh and Vitagen are well-known by consumers.  The company offers a wide range of products such as sweetened condensed milk, evaporated milk, UHT milk, juices and Asian drinks, pasteurised milk, juices, cultured milk, soft yoghurt, yoghurt drink, jelly and pudding.  Malaysia Milk positions itself in the medium end of the market due to its affordably priced products which target consumers from different income groups. In addition, consumers are typically quality as opposed to value conscious when it comes to purchasing health and wellness packaged food and beverages.

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18

HEALTH AND W ELLNESS IN MALAYSIA

Passport

 The company is a leading innovator in pro/pre biotic drinking yoghurt in Malaysia, where it ranked first in 2014. Malaysia Milk is well-known for its Vitagen drinking yoghurt, which is widely available in most retail outlets. Summary 5 Product type

Malaysia Milk Sdn Bhd: Competitive Position 2014 Value share Rank

Health and Wellness Beverages

2.5%

9

Fortified/Functional Beverages

2.7%

8

Naturally Healthy Beverages

2.0%

8

Pro/Pre Biotic Drinking Yoghurt

43.1%

1

Source:

Euromonitor International from company reports, company research, trade press, trade sources, trade interviews

© Euromonitor International

19

HEALTH AND W ELLNESS IN MALAYSIA

BETTER FOR YOU BEVERAGES IN MALAYSIA - CATEGORY ANALYSIS HEADLINES  Better for you beverages current value sales increase by 5% in 2014 to reach MYR91 million  Rising consumer health awareness fuels demand for better for you beverages in 2014  Off-trade unit prices increase by less than 1% in 2014  Coca-Cola Bottlers leads sales in 2014, recording an off-trade value share of 49%  Better for you beverages has a projected forecast period constant 2014 price value CAGR of 1%, with sales set to reach MYR95 million by 2019

TRENDS  Rising obesity and diabetes rates and high cholesterol levels, especially among children and adults, are driving consumers to eagerly look for healthy food and beverages. In addition, the Malaysian Advertisers Association and the Federation of Malaysian Manufacturers Food Manufacturing group has been collaborating with several food and beverages companies to ensure compliance with the Responsible Advertising to Children Pledge (August 2013), with companies promising not to target children via the broadcast and print media.  Better for you beverages recorded current value growth of 4% in 2014 – a slight decline from the review period CAGR. Even so, sales continue to increase due to growing demand from consumers. In addition, government agencies and companies are frequently organising campaigns to promote healthy lifestyles through media broadcasts and sports events.  Better for you reduced sugar beverages led growth in 2014, with current value sales rising by 5%. Many products have introduced reduced sugar beverages like instant coffee, RTD tea and Asian speciality drinks. Brands that offer reduced sugar beverages include Ah Huat White Coffee, Aik Cheong Instant White Coffee, Power Root Ali Café 4-in-1, Chek Hup instant coffee, Marigold Less Sugar Lychee Drink, Yeo’s Reduced Sugar Chrysanthemum Tea, F&N Seasons Reduced Sugar Grass Jelly Drink and F&N Seasons Reduced Sugar Chrysanthemum Tea.  There are several areas and companies offering stevia beverages in Malaysia. However, stevia remains unpopular due to a lack of awareness of the benefits of the product among consumers. There are tea and liquid concentrates which offer stevia such as Montea stevia from Kong Woon Fong Tea Merchants and Magic Taste Cordial from Magic Taste Syrups Marketing. Both companies are domestic players but lack brand awareness while private label offerings like Tesco and First Choice from Giant do not yet offer stevia products in Malaysia.  Consumers usually choose to exercise and consume reduce weight products like powder and beverages like tea and coffee. While reduced sugar beverages are not widely available in Malaysia, there are several product areas offering reduced sugar. However, consumers continue to choose sugarised beverages due to their better taste. Nevertheless, there is an opportunity for companies to introduce more reduced sugar drinks without compromising taste due to rising health awareness among consumers.

© Euromonitor International

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HEALTH AND W ELLNESS IN MALAYSIA

 Consumers usually purchase more regular beverages during seasonal periods like Chinese New Year and Hari Raya while switching every so often to reduced sugar beverages. Soft drinks was the first area to be blamed for rising obesity and diabetes rates in Malaysia and leading players like Fraser & Neave Holdings constantly promote reduced sugar RTD tea and Asian speciality drinks rather than F&N carbonates that contain higher sugar levels. Obviously, leading soft drinks companies are not promoting healthy product ranges as a solution to weight management or other health conditions. However, leading companies might look to sponsor domestic sports events and promote healthy lifestyles through frequent exercise in order to raise awareness of their brands.  Independent small grocers recorded an off-trade value share of 40% within better for you beverages in 2014 and were followed by hypermarkets (35%). Consumers can generally purchase better for you beverages in modern retail channels like hypermarkets, supermarkets, forecourt retail outlets and convenience stores. However, consumers still purchase better for you beverages in independent small grocers, which are typically conveniently located.

COMPETITIVE LANDSCAPE  Coca-Cola Bottlers continued to lead better for you beverages in 2014, recording an off-trade value share of 49% and sales of MYR44 million. The company offers its popular Coco-Cola Light, which is widely accepted by all consumers as it has a lower calorie content.  Permanis recorded the biggest decrease in sales in 2014 (-76% to MYR2 million). The main reason for this drop in sales share was the discontinuation of Pepsi Max in 2014. The company has stopped selling Pepsi Max in Malaysia while its Pepsi Light brand is still growing, recording an off-trade value share of 2% in 2014.  There were no key new launches in 2014. However, in August 2013 Inbisco Marketing & Sales launched Kopiko L.A. Coffee, which offers low acid instant coffee, while Fraser & Neave Holdings offered F&N Season NutriWell Chrysanthemum with reduced sugar in October 2013. Both new products impacted instant coffee and RTD tea, with the area becoming increasingly intense with regard to competing brand names.  Large players like Coca-Cola Bottlers and Fraser & Neave Holdings adopted several strategies to gain success in better for you beverages in 2014. For instance, one successful strategy was aggressive promotions like price discounts, wide distribution channels and enhancing brand awareness through on-going media advertisements. In addition, other players might also implement similar strategies to gain sales share and consumer attention.  Better for you beverages are usually positioned as standard priced items, with manufacturers targeting medium to high end consumers. Medium to high income groups usually put more emphasis on healthy ranges since they can afford such products and understand the advantages of consuming healthier brands.

PROSPECTS  Better for you beverages has a projected constant 2014 price value CAGR of 1%. Consumers continue to look more for reduced sugar, fat and calorie beverages due to rising health awareness.

© Euromonitor International

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HEALTH AND W ELLNESS IN MALAYSIA

Passport

 Increasingly high obesity, cholesterol and diabetes rates are driving consumers to look for more non-alcoholic drinks that offer reduced sugar content. As a result, it is expected that manufacturers will increasingly offer stevia blend beverages over the forecast period.  The Malaysian government, especially the Health Minister, is constantly encouraging Malaysians to live healthily by consuming more healthy food and beverages due to the increasingly high obesity rate and rise in the number of diabetes cases. A growing number of manufacturers offer better for you beverages that can help to reduce obesity and the incidence of diabetes in Malaysia.  Potential threats to forecast period growth include the increasingly high inflation rate, consumer spending patterns and government policies reform. Although consumers understand that better for you beverages are good for health, increasingly high commodity prices are driving consumers to spend less on healthy products. In addition, the government is looking to implement a goods and service tax in 2015 that may drive consumers to spend carefully over the forecast period.

CATEGORY DATA Table 17

Sales of BFY Beverages by Category: Value 2009-2014

MYR million

---- BFY Reduced Caffeine Beverages ----- BFY Reduced Caffeine Hot Drinks ----- BFY Reduced Caffeine Soft Drinks ---- BFY Reduced Fat Beverages ----- Reduced Fat Other Hot Drinks ---- BFY Reduced Sugar Beverages ----- BFY Reduced Sugar Hot Drinks ----- BFY Reduced Sugar Soft Drinks --- Better For You Beverages Source:

Table 18

2009

2010

2011

2012

2013

2014

5.0

5.1

5.2

5.2

5.2

5.3

5.0

5.1

5.2

5.2

5.2

5.3

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

67.4

70.3

73.8

77.7

81.6

85.4

0.7

0.7

0.7

0.7

0.7

0.8

66.7

69.6

73.1

77.0

80.9

84.7

72.5

75.4

79.0

82.9

86.8

90.7

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Sales of BFY Beverages by Category: % Value Growth 2009-2014

% current value growth

---- BFY Reduced Caffeine Beverages ----- BFY Reduced Caffeine Hot Drinks ----- BFY Reduced Caffeine Soft Drinks ---- BFY Reduced Fat Beverages ----- Reduced Fat Other Hot Drinks

© Euromonitor International

2013/14

2009-14 CAGR

2009/14 Total

1.1 1.1 -

1.1 1.1 -

5.4 5.4 -

22

HEALTH AND W ELLNESS IN MALAYSIA

Passport

---- BFY Reduced Sugar Beverages ----- BFY Reduced Sugar Hot Drinks ----- BFY Reduced Sugar Soft Drinks --- Better For You Beverages Source:

4.7 2.0 4.7 4.5

NBO Company Shares of BFY Beverages: % Value 2010-2014

% retail value rsp Company Coca-Cola Bottlers (M) Sdn Bhd Fraser & Neave Holdings Bhd Nestlé (Malaysia) Bhd Permanis Sdn Bhd Yeo Hiap Seng (M) Bhd Boncafé (M) Sdn Bhd F&N Coca-Cola (M) Sdn Bhd Others Total

2010

2011

2012

2013

2014

-

33.4

33.6

41.6

48.9

66.9

33.7

33.8

33.8

33.8

6.3 16.8 1.0 0.2 8.8 100.0

6.1 16.9 1.0 0.2 8.7 100.0

5.8 16.9 1.0 0.2 8.6 100.0

5.6 9.2 1.1 0.2 8.5 100.0

5.4 2.1 1.1 0.2 8.4 100.0

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Table 20

LBN Brand Shares of BFY Beverages: % Value 2011-2014

% retail value rsp Brand Coca-Cola Light Seasons Nescafé Decaffeinated Pepsi Light Yeo's Boncafé Decaffeinated Coffee Pepsi Max Coca-Cola Light Seasons Coca-Cola Light

Company

2011

2012

2013

2014

Coca-Cola Bottlers (M) Sdn Bhd Fraser & Neave Holdings Bhd Nestlé (Malaysia) Bhd Permanis Sdn Bhd Yeo Hiap Seng (M) Bhd Boncafé (M) Sdn Bhd

33.4

33.6

41.6

48.9

33.7

33.8

33.8

33.8

6.1 0.9 1.0 0.2

5.8 0.9 1.0 0.2

5.6 1.2 1.1 0.2

5.4 2.1 1.1 0.2

Permanis Sdn Bhd F&N Coca-Cola (M) Sdn Bhd F&N Coca-Cola (M) Sdn Bhd Fraser & Neave Holdings Bhd

16.0 -

16.0 -

8.0 -

-

8.7 100.0

8.6 100.0

8.5 100.0

8.4 100.0

2013

2014

Others Total Source:

26.7 3.2 27.0 25.2

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Table 19

Source:

4.8 0.6 4.9 4.6

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Table 21

Distribution of BFY Beverages by Format: % Value 2009-2014

% retail value rsp 2009

© Euromonitor International

2010

2011

2012

23

HEALTH AND W ELLNESS IN MALAYSIA

Store-Based Retailing - Grocery Retailers -- Modern Grocery Retailers --- Convenience Stores --- Discounters --- Forecourt Retailers --- Hypermarkets --- Supermarkets -- Traditional Grocery Retailers --- Food/drink/tobacco specialists --- Independent Small Grocers -- Other Grocery Retailers - Non-Grocery Specialists Non-Store Retailing - Vending - Homeshopping - Internet Retailing - Direct Selling Total Source:

Passport

96.3 96.3 53.2

96.4 96.4 53.7

96.5 96.5 54.1

96.5 96.5 54.5

96.6 96.6 54.6

96.6 96.6 54.8

7.2 4.7 33.8 7.4 41.7

7.2 4.6 34.3 7.6 41.3

7.2 4.4 34.6 7.8 41.0

7.2 4.4 34.9 8.0 40.6

7.2 4.4 34.8 8.2 40.4

7.2 4.4 34.8 8.4 40.2

-

-

-

-

-

-

41.7

41.3

41.0

40.6

40.4

40.2

1.4

1.4

1.4

1.4

1.6

1.6

3.7 3.5 0.3 100.0

3.6 3.3 0.3 100.0

3.5 3.3 0.3 100.0

3.5 3.2 0.3 100.0

3.4 3.2 0.3 100.0

3.4 3.2 0.3 100.0

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Table 22

Forecast Sales of BFY Beverages by Category: Value 2014-2019

MYR million

---- BFY Reduced Caffeine Beverages ----- BFY Reduced Caffeine Hot Drinks ----- BFY Reduced Caffeine Soft Drinks ---- BFY Reduced Fat Beverages ----- Reduced Fat Other Hot Drinks ---- BFY Reduced Sugar Beverages ----- BFY Reduced Sugar Hot Drinks ----- BFY Reduced Sugar Soft Drinks --- Better For You Beverages Source:

Table 23

2014

2015

2016

2017

2018

2019

5.3

5.2

5.0

4.9

4.8

4.7

5.3

5.2

5.0

4.9

4.8

4.7

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

85.4

86.6

87.5

88.6

89.7

90.7

0.8

0.8

0.7

0.7

0.7

0.7

84.7

85.8

86.8

87.9

89.0

90.0

90.7

91.8

92.5

93.5

94.5

95.4

Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources

Forecast Sales of BFY Beverages by Category: % Value Growth 2014-2019

% constant value growth 2014/2015

© Euromonitor International

2014-19 CAGR

2014/19 TOTAL

24

HEALTH AND W ELLNESS IN MALAYSIA

---- BFY Reduced Caffeine Beverages ----- BFY Reduced Caffeine Hot Drinks ----- BFY Reduced Caffeine Soft Drinks ---- BFY Reduced Fat Beverages ----- Reduced Fat Other Hot Drinks ---- BFY Reduced Sugar Beverages ----- BFY Reduced Sugar Hot Drinks ----- BFY Reduced Sugar Soft Drinks --- Better For You Beverages Source:

Passport

-2.2 -2.2 1.2 -1.9 1.2 1.0

-2.4 -2.4 1.2 -1.5 1.2 1.0

Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources

© Euromonitor International

-11.2 -11.2 6.2 -7.5 6.3 5.2

25

HEALTH AND W ELLNESS IN MALAYSIA

BETTER FOR YOU PACKAGED FOOD IN MALAYSIA - CATEGORY ANALYSIS HEADLINES  Better for you packaged food gained 5% current value growth and recorded RM366 million value sales in 2014  Consumers tend to demand more better for you in order maintain or reduce weight to look fit  Unit prices increase in better for you packaged food in 2014  Better for you packaged food expected to see 2% constant value CAGR over forecast period

TRENDS  Consumers pay increasing attention to their appearance by consuming more reduced sugar, low carbohydrate and low fat products. The growing number of new products introduced by companies includes light mayonnaise, low sugar and low fat yoghurt, low fat milk and reduced or sugar free confectionery.  Better for you packaged food saw 5% current value growth in 2014. Consumers are searching for better for you packaged food products due to increasingly health awareness. For instance, increasing rates of obesity, diabetes, high cholesterol and heart disease drove consumers to consume more healthy packaged food.  Better for you sugar-free confectionery saw the fastest growing of 1% in current value terms in 2014. Consumers have become increasingly aware of health issues such as diabetes and obesity, especially the younger generation. Hence, consumers tend to choose more sugarfree confectionery such as chewing gum and boiled sweets.  Consumers usually purchase meal replacement products and beverages such as slimming tea or coffee to reduce weight. 29% of population was overweight in 2014, and increasing compared with the review period. Therefore consumers were becoming aware of the importance of weight management and consuming fewer packaged food products high in calories.  Consumers eat better for you packaged food to maintain or reduce weight and live healthily, with meal replacement products particularly being perceived as an aid to control weight. In contrast, better for you packaged food is perceived to reduce cholesterol, diabetes and heart disease, rather than to counter obesity and control weight.  The packaged food mostly found in retail outlets does not offer stevia as an alternative to sugar, but packaged food is mainly found offering low sugar content or sugar free. However, stevia can be found for beverages selling through retail outlets.  Consumers buy better for you packaged food products in order to reduce or prevent health issues such as high cholesterol, reduce the potential for heart-related diseases, and to reduce diabetes as well as obesity. Furthermore, health awareness also drives consumers to consume better for you packaged food as government agencies organised campaigns to encourage healthy lifestyles, such as media advertising and organising sports events.

© Euromonitor International

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26

HEALTH AND W ELLNESS IN MALAYSIA

COMPETITIVE LANDSCAPE  Mondelez (M) Sales Sdn Bhd led better for you sugar-free confectionery in 2014 with a 67% retail value share. The company is popular for its offerings such as Clorets, which is widely found in both modern and traditional grocery retail outlets. Other than strong distribution, the company offers quality taste for its standard mints, the taste of which appeals to most consumers due to not being too strong. In reduced sugar chocolate confectionery Mondelez (M) Sales Sdn Bhd saw the largest value increase of 6%, reaching RM22 million in value sales in 2014.  Examples of key campaigns organised by companies included price discounts, bundles, extra volume and value pack offers. Consumers are usually attracted by value packs or price discounts, especially value and health conscious consumers.  There were no significant new products launched in 2014, and the market remains occupied by international players with a strong foothold in Malaysia.  The private label movement was quite weak in better for you sugar-free confectionery at the end of the review period. Private labels such as First Choice and Tesco remained insignificant in terms of launching better for you sugar-free confectionery, as these private label products offer regular confectionery but lack brand awareness.

PROSPECTS  Better for you packaged food is expected to see a 2% constant value CAGR over the forecast period. Manufacturers will continue to introduce better for you packaged food in order to encourage consumers to eat healthily and with the aim of benefitting from their increasing health awareness. Furthermore, government agencies and non-governmental organisations will continue to organise sports events and media advertisements to encourage healthy lifestyles.  Better for you packaged food will growing further in Malaysia as much packaged food is perceived as unhealthy, such as canned/preserved food, sweet and savoury snacks and confectionery. Therefore, the increasing introduction of better for you packaged food will help consumers eat healthier products.  The potential forecast threats to growth are factors such as inflation, consumer spending habits and government reform policies. The increasing inflation rate drives up unit selling prices for commodity products; hence consumers are having to spend more to buy essential products rather than non-essential items, and are choosing to cook at home frequently. Furthermore, government reform policies by implementing goods and service tax in 2015 encourages consumers to spend carefully.  Consumers widely perceive that reduced sugar food can help prevent problems with diabetes rather than for weight management. While the obesity rate is rising consumers are more likely to reduce portion size or consume more meal replacement products to combat this problem. Stevia is expected to be introduced by manufacturers, especially of confectionery and ice cream products. This is because stevia can be found in beverages such as tea and liquid concentrates, as stevia can only be mixed with sugar. Manufacturers should introduce and educate consumers regarding the benefits of stevia.  Growth over the forecast period is expected to be faster than the performance seen over the review period. This is due to the increasing health issues driving consumers to consumption of more healthy products. Better for you sugar-free confectionery is expected to grow further in coming years as consumers perceive confectionery products as unhealthy. Therefore,

© Euromonitor International

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Passport

manufacturers will try to introduce more variants and brands to cater to greater demand and increase shares.

CATEGORY DATA Table 24

Sales of BFY Packaged Food by Category: Value 2009-2014

MYR '000

---- BFY Reduced Carb Packaged Food ----- Reduced Carb Bakery Products ----- Reduced Carb Confectionery ----- Reduced Carb Ice Cream ----- Reduced Carb Pasta ----- Reduced Carb Sauces, Dressings and Condiments ----- Reduced Carb Soup ----- Reduced Carb Sweet and Savoury Snacks Excl Nuts and Fruit Snacks ---- BFY Reduced Fat Packaged Food ----- Reduced Fat Bakery Products ----- Reduced Fat Chilled Processed Meats, Fish/Seafood and Lunch Kit ----- Reduced Fat Canned/Preserved Food Excluding Ready Meals, Soup and Pasta ----- Reduced Fat Chocolate Confectionery ----- Reduced Fat Dairy ----- Reduced Fat Frozen Processed Food Excluding Ready Meals, Pizza, Soup and Noodles ----- Reduced Fat Ice Cream ----- Reduced Fat Oils and Fats ----- Reduced Fat Ready Meals ----- Reduced Fat Sauces, Dressings and Condiments ----- Reduced Fat Soup ----- Reduced Fat Spreads excl Honey

© Euromonitor International

2009

2010

2011

2012

2013

2014

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

213,247.1

222,287.4

228,038.2

233,380.2

235,381.6

248,034.2

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

205,182.7 -

213,151.7 -

218,534.8 -

223,440.9 -

224,803.6 -

236,823.0 -

-

-

-

-

-

-

3,564.4

3,761.1

3,924.7

4,197.8

4,474.9

4,747.8

-

-

-

-

-

-

-

-

-

-

-

-

4,500.0

5,374.6

5,578.7

5,741.5

6,103.2

6,463.3

28

HEALTH AND W ELLNESS IN MALAYSIA

----- Reduced Fat Sweet and Savoury Snacks ---- BFY Reduced Salt Food ----- Reduced Salt Canned/Preserved Food Excluding Ready Meals, Soup and Pasta ----- Reduced Salt Ready Meals ----- Reduced Salt Regular Spreadable Oils and Fats ----- Reduced Salt Soup ----- Reduced Salt Sauces, Dressings and Condiments ----- Reduced Salt Sweet and Savoury Snacks Excl Nuts and Fruit Snacks ---- BFY Reduced Sugar Packaged Food ----- Reduced Sugar Bakery Products ----- Reduced Sugar Canned/Preserved Food Excluding Ready Meals, Soup and Pasta ----- Reduced Sugar Confectionery ----- Reduced Sugar Dairy ----- Reduced Sugar Ice Cream ----- Reduced Sugar Spreads excl Honey --- Better For You Packaged Food Source:

Table 25

Passport

-

-

-

-

-

-

3,126.9

3,311.4

3,463.6

3,714.8

3,967.4

4,221.3

-

-

-

-

-

-

-

-

-

-

-

-

3,126.9

3,311.4

3,463.6

3,714.8

3,967.4

4,221.3

-

-

-

-

-

-

-

-

-

-

-

-

91,848.2

95,766.0

99,713.3

104,599.5

109,173.4

113,601.8

-

-

-

-

-

-

-

-

-

-

-

-

78,315.8

81,585.7

84,528.2

88,056.7

91,224.5

94,199.0

-

-

-

-

-

-

13,532.4

14,180.3

15,185.1

16,542.8

17,948.9

19,402.8

308,222.1

321,364.8

331,215.1

341,694.6

348,522.5

365,857.3

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Sales of BFY Packaged Food by Category: % Value Growth 2009-2014

% current value growth

---- BFY Reduced Carb Packaged Food ----- Reduced Carb Bakery Products ----- Reduced Carb Confectionery ----- Reduced Carb Ice Cream ----- Reduced Carb Pasta ----- Reduced Carb Sauces, Dressings and Condiments ----- Reduced Carb Soup ----- Reduced Carb Sweet and Savoury Snacks Excl Nuts and Fruit Snacks ---- BFY Reduced Fat Packaged Food ----- Reduced Fat Bakery Products ----- Reduced Fat Chilled Processed

© Euromonitor International

2013/14

2009-14 CAGR

2009/14 Total

-

-

-

-

-

-

5.4 -

3.1 -

16.3 -

29

HEALTH AND W ELLNESS IN MALAYSIA

Passport

Meats, Fish/Seafood and Lunch Kit ----- Reduced Fat Canned/Preserved Food Excluding Ready Meals, Soup and Pasta ----- Reduced Fat Chocolate Confectionery ----- Reduced Fat Dairy ----- Reduced Fat Frozen Processed Food Excluding Ready Meals, Pizza, Soup and Noodles ----- Reduced Fat Ice Cream ----- Reduced Fat Oils and Fats ----- Reduced Fat Ready Meals ----- Reduced Fat Sauces, Dressings and Condiments ----- Reduced Fat Soup ----- Reduced Fat Spreads excl Honey ----- Reduced Fat Sweet and Savoury Snacks ---- BFY Reduced Salt Food ----- Reduced Salt Canned/Preserved Food Excluding Ready Meals, Soup and Pasta ----- Reduced Salt Ready Meals ----- Reduced Salt Regular Spreadable Oils and Fats ----- Reduced Salt Soup ----- Reduced Salt Sauces, Dressings and Condiments ----- Reduced Salt Sweet and Savoury Snacks Excl Nuts and Fruit Snacks ---- BFY Reduced Sugar Packaged Food ----- Reduced Sugar Bakery Products ----- Reduced Sugar Canned/Preserved Food Excluding Ready Meals, Soup and Pasta ----- Reduced Sugar Confectionery ----- Reduced Sugar Dairy ----- Reduced Sugar Ice Cream ----- Reduced Sugar Spreads excl Honey --- Better For You Packaged Food Source:

-

-

-

-

-

-

5.3 -

2.9 -

15.4 -

6.1 -

5.9 -

33.2 -

5.9 -

7.5 -

43.6 -

6.4 -

6.2 -

35.0 -

6.4

6.2

35.0

-

-

-

-

-

-

4.1 -

4.3 -

23.7 -

3.3 8.1 5.0

3.8 7.5 3.5

20.3 43.4 18.7

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Table 26

NBO Company Shares of BFY Packaged Food: % Value 2010-2014

% retail value rsp Company Malaysia Milk Sdn Bhd Fraser & Neave Holdings Bhd Mondelez (M) Sales Sdn Bhd Susu Lembu Asli Marketing Sdn Bhd Perfetti Van Melle Group Mars Malaysia JM Smucker Co, The

© Euromonitor International

2010

2011

2012

2013

2014

18.2 21.2

18.5 20.1

18.6 19.1

19.2 17.0

19.2 17.0

-

-

-

9.4

9.3

7.7

7.6

7.5

7.5

7.3

5.6 2.8 2.4

5.7 2.9 2.5

5.8 3.0 2.6

5.3 3.6 2.7

5.2 3.6 2.8

30

HEALTH AND W ELLNESS IN MALAYSIA

Chupa Chups (Grupo) SA Lam Soon (M) Bhd Network Foods Industries Sdn Bhd SPC Ardmona Ltd Goodman Fielder Ltd Unilever (M) Holdings Sdn Bhd Kraft Foods (M) Sdn Bhd Cadbury Confectionery (M) Sdn Bhd Ferndale Confectionery Pty Ltd Wrigley Co (Malaysia) Sdn Bhd, The Others Total Source:

Passport

1.2 0.9 0.7

1.2 0.9 0.7

1.3 1.0 0.7

1.3 1.1 0.7

1.3 1.1 0.7

0.3 0.2 0.2

0.3 0.2 0.2

0.3 0.2 0.2

0.3 0.2 0.2

0.3 0.2 0.2

8.8 -

9.0 -

9.2 -

-

-

-

-

-

-

-

-

-

-

-

-

29.8 100.0

30.3 100.0

30.6 100.0

31.5 100.0

31.9 100.0

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Table 27

LBN Brand Shares of BFY Packaged Food: % Value 2011-2014

% retail value rsp Brand Marigold F&N Magnolia Goodday Mentos Farmhouse Clorets Smucker's Extra Cadbury Dairy Milk Smint Naturel Cadbury Zip Cadbury Time Out Tudor Gold Snickers Happydent Cadbury Picnic Mars IXL Meadow Lea Cadbury Crunchie Skippy Cadbury Break Cadbury Assortments Philadelphia Clorets Daisy Cadbury Dairy Milk

© Euromonitor International

Company

2011

2012

2013

2014

Malaysia Milk Sdn Bhd Fraser & Neave Holdings Bhd Susu Lembu Asli Marketing Sdn Bhd Perfetti Van Melle Group Fraser & Neave Holdings Bhd Mondelez (M) Sales Sdn Bhd JM Smucker Co, The Mars Malaysia Mondelez (M) Sales Sdn Bhd Chupa Chups (Grupo) SA Lam Soon (M) Bhd Mondelez (M) Sales Sdn Bhd Mondelez (M) Sales Sdn Bhd Network Foods Industries Sdn Bhd Mars Malaysia Perfetti Van Melle Group Mondelez (M) Sales Sdn Bhd Mars Malaysia SPC Ardmona Ltd Goodman Fielder Ltd Mondelez (M) Sales Sdn Bhd Unilever (M) Holdings Sdn Bhd Mondelez (M) Sales Sdn Bhd Mondelez (M) Sales Sdn Bhd Mondelez (M) Sales Sdn Bhd Kraft Foods (M) Sdn Bhd Fraser & Neave Holdings Bhd Kraft Foods (M) Sdn Bhd

18.5 13.3

18.6 12.7

19.2 13.3

19.2 13.4

7.6

7.5

7.5

7.3

5.3 3.8

5.4 3.7

4.9 3.7

4.8 3.6

2.5 2.1 1.2 0.9 0.7

2.6 2.1 1.3 1.0 0.7

3.3 2.7 2.7 2.1 1.3 1.1 1.1 0.8 0.7

3.1 2.8 2.7 2.2 1.3 1.1 1.1 0.8 0.7

0.5 0.4 0.3 0.3 0.2 0.2

0.6 0.4 0.3 0.3 0.2 0.2

0.6 0.4 0.3 0.3 0.3 0.2 0.2 0.2

0.6 0.4 0.3 0.3 0.3 0.2 0.2 0.2

3.1 3.0

3.2 2.8

0.1 0.1 0.1 -

0.1 0.1 0.1 -

2.0

2.1

-

-

31

HEALTH AND W ELLNESS IN MALAYSIA

Cadbury Zip Cadbury Time Out Others Total Source:

Passport

Kraft Foods (M) Sdn Bhd Kraft Foods (M) Sdn Bhd

1.0 0.8 32.3 100.0

1.0 0.8 32.7 100.0

32.8 100.0

33.2 100.0

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Table 28

Distribution of BFY Packaged Food by Format: % Value 2009-2014

% retail value rsp

Store-Based Retailing - Grocery Retailers -- Modern Grocery Retailers --- Convenience Stores --- Discounters --- Forecourt Retailers --- Hypermarkets --- Supermarkets -- Traditional Grocery Retailers --- Food/drink/tobacco specialists --- Independent Small Grocers -- Other Grocery Retailers - Non-Grocery Specialists Non-Store Retailing - Vending - Homeshopping - Internet Retailing - Direct Selling Total Source:

2009

2010

2011

2012

2013

2014

100.0 100.0 90.3

100.0 100.0 90.2

100.0 100.0 90.2

100.0 100.0 90.3

100.0 100.0 90.4

100.0 100.0 90.5

4.5 60.5 25.3 6.5

4.2 60.6 25.4 6.4

4.0 60.7 25.5 6.2

3.9 60.8 25.6 6.1

3.8 60.9 25.7 6.0

3.7 61.0 25.8 5.9

-

-

-

-

-

-

6.5

6.4

6.2

6.1

6.0

5.9

3.2

3.4

3.6

3.6

3.6

3.6

100.0

100.0

100.0

100.0

100.0

100.0

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Table 29

Forecast Sales of BFY Packaged Food by Category: Value 2014-2019

MYR '000

---- BFY Reduced Carb Packaged Food ----- Reduced Carb Bakery Products ----- Reduced Carb Confectionery ----- Reduced Carb Ice Cream ----- Reduced Carb Pasta ----- Reduced Carb Sauces, Dressings and Condiments ----- Reduced Carb Soup

© Euromonitor International

2014

2015

2016

2017

2018

2019

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

32

HEALTH AND W ELLNESS IN MALAYSIA

----- Reduced Carb Sweet and Savoury Snacks Excl Nuts and Fruit Snacks ---- BFY Reduced Fat Packaged Food ----- Reduced Fat Bakery Products ----- Reduced Fat Chilled Processed Meats, Fish/Seafood and Lunch Kit ----- Reduced Fat Canned/Preserved Food Excluding Ready Meals, Soup and Pasta ----- Reduced Fat Chocolate Confectionery ----- Reduced Fat Dairy ----- Reduced Fat Frozen Processed Food Excluding Ready Meals, Pizza, Soup and Noodles ----- Reduced Fat Ice Cream ----- Reduced Fat Oils and Fats ----- Reduced Fat Ready Meals ----- Reduced Fat Sauces, Dressings and Condiments ----- Reduced Fat Soup ----- Reduced Fat Spreads excl Honey ----- Reduced Fat Sweet and Savoury Snacks ---- BFY Reduced Salt Food ----- Reduced Salt Canned/Preserved Food Excluding Ready Meals, Soup and Pasta ----- Reduced Salt Ready Meals ----- Reduced Salt Regular Spreadable Oils and Fats ----- Reduced Salt Soup ----- Reduced Salt Sauces, Dressings and Condiments ----- Reduced Salt Sweet and Savoury Snacks Excl Nuts and Fruit Snacks ---- BFY Reduced Sugar Packaged Food ----- Reduced Sugar Bakery Products ----- Reduced Sugar

© Euromonitor International

Passport

-

-

-

-

-

-

248,034.2

254,971.0

262,792.7

270,232.8

277,155.3

283,381.8

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

236,823.0 -

243,339.9 -

250,749.1 -

257,793.0 -

264,336.2 -

270,205.1 -

-

-

-

-

-

-

4,747.8

4,909.2

5,066.3

5,218.3

5,359.2

5,493.2

-

-

-

-

-

-

-

-

-

-

-

-

6,463.3

6,721.8

6,977.3

7,221.5

7,459.8

7,683.6

-

-

-

-

-

-

4,221.3

4,381.7

4,539.5

4,693.8

4,844.0

4,989.3

-

-

-

-

-

-

-

-

-

-

-

-

4,221.3

4,381.7

4,539.5

4,693.8

4,844.0

4,989.3

-

-

-

-

-

-

-

-

-

-

-

-

113,601.8

115,288.6

116,780.0

118,521.7

120,356.4

122,331.5

-

-

-

-

-

-

-

-

-

-

-

-

33

HEALTH AND W ELLNESS IN MALAYSIA

Canned/Preserved Food Excluding Ready Meals, Soup and Pasta ----- Reduced Sugar Confectionery ----- Reduced Sugar Dairy ----- Reduced Sugar Ice Cream ----- Reduced Sugar Spreads excl Honey --- Better For You Packaged Food Source:

Table 30

Passport

94,199.0

94,838.1

95,266.0

95,932.0

96,659.8

97,521.2

-

-

-

-

-

-

19,402.8

20,450.6

21,514.0

22,589.7

23,696.6

24,810.3

365,857.3

374,641.4

384,112.1

393,448.3

402,355.6

410,702.7

Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources

Forecast Sales of BFY Packaged Food by Category: % Value Growth 20142019

% constant value growth

---- BFY Reduced Carb Packaged Food ----- Reduced Carb Bakery Products ----- Reduced Carb Confectionery ----- Reduced Carb Ice Cream ----- Reduced Carb Pasta ----- Reduced Carb Sauces, Dressings and Condiments ----- Reduced Carb Soup ----- Reduced Carb Sweet and Savoury Snacks Excl Nuts and Fruit Snacks ---- BFY Reduced Fat Packaged Food ----- Reduced Fat Bakery Products ----- Reduced Fat Chilled Processed Meats, Fish/Seafood and Lunch Kit ----- Reduced Fat Canned/Preserved Food Excluding Ready Meals, Soup and Pasta ----- Reduced Fat Chocolate Confectionery ----- Reduced Fat Dairy ----- Reduced Fat Frozen Processed Food Excluding Ready Meals, Pizza, Soup and Noodles ----- Reduced Fat Ice Cream ----- Reduced Fat Oils and Fats ----- Reduced Fat Ready Meals ----- Reduced Fat Sauces, Dressings and Condiments ----- Reduced Fat Soup ----- Reduced Fat Spreads excl Honey ----- Reduced Fat Sweet and Savoury Snacks ---- BFY Reduced Salt Food ----- Reduced Salt Canned/Preserved Food Excluding Ready Meals, Soup and Pasta ----- Reduced Salt Ready Meals ----- Reduced Salt Regular Spreadable

© Euromonitor International

2014/2015

2014-19 CAGR

2014/19 TOTAL

-

-

-

-

-

-

2.2 -

2.7 -

14.3 -

-

-

-

-

-

-

2.2 -

2.7 -

14.1 -

2.5 -

3.0 -

15.7 -

3.0 -

3.5 -

18.9 -

3.0 -

3.4 -

18.2 -

3.0

3.4

18.2

34

HEALTH AND W ELLNESS IN MALAYSIA

Oils and Fats ----- Reduced Salt Soup ----- Reduced Salt Sauces, Dressings and Condiments ----- Reduced Salt Sweet and Savoury Snacks Excl Nuts and Fruit Snacks ---- BFY Reduced Sugar Packaged Food ----- Reduced Sugar Bakery Products ----- Reduced Sugar Canned/Preserved Food Excluding Ready Meals, Soup and Pasta ----- Reduced Sugar Confectionery ----- Reduced Sugar Dairy ----- Reduced Sugar Ice Cream ----- Reduced Sugar Spreads excl Honey --- Better For You Packaged Food Source:

Passport

-

-

-

-

-

-

1.6 -

1.5 -

7.7 -

0.9 4.7 2.1

0.7 5.0 2.3

3.5 27.9 12.3

Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources

© Euromonitor International

35

HEALTH AND W ELLNESS IN MALAYSIA

FOOD INTOLERANCE IN MALAYSIA CATEGORY ANALYSIS HEADLINES  Food intolerance sees 3% current value growth reaching RM16 million in 2014  Consumers continue to demand food intolerance due to increasing health issues  Lactose free special baby milk formula sees highest growth of 3% current value terms in 2014  Unit price increases for food intolerance in 2014  Abbott Laboratories (M) Sdn Bhd leads sales with 33% value share in 2014  Food intolerance expected to see 1% constant value CAGR over forecast period

TRENDS  Consumers typically consume food intolerance products only when they are facing health problems such as the inability to digest certain amounts of lactose, diabetes and intolerance to wheat products.  The growth of food intolerance in 2014 was similar to the overall review period performance. Consumers maintained consumption, especially those facing health problems such as diabetes, inability to digest gluten and lactose intolerance. Other consumers not facing these health problems were not aware of these products.  Lactose free special baby milk formula saw the fastest growth of 3% in current value terms in 2014. This was due to aggressive marketing campaigns organised by large players, and also quality assurances encouraged consumers to purchase safely. International brands such as Isomil, Nan and Enfalac are popular for baby milk formula, and widely sold through major retail outlets such as hypermarkets, supermarkets and para-pharmacies such as Guardian and Caring Pharmacy. Furthermore, aggressive marketing campaigns such as on-going media advertisements, distribution of samples, roadshows and events were organised by leading players.  Usually the target audience for food intolerance products is those suffering gluten and lactose intolerance and diabetes. Baby milk formula was growing faster than products for adults as babies need high nutritional value to help them grow. Adults purchasing milk formula only occasionally or when facing health problems.  Malaysia is perceived as the highest diabetic country among the Asian countries and ranked sixth in the Western Pacific region. The Obesity Prevention Council estimated that around 3.6 million adults would experience diabetes in Malaysia in 2013. As a result, several initiatives were organised by government agencies and non-governmental organisations to combat and raise awareness of diabetes in Malaysia in 2014. These included World Diabetes Day Charity Run and Walkathon 2014, Walk For Cure 2014 and Step Out and Step Up For Diabetes Contest, and the Diabetes Malaysia Workshop 2014. Consumers would become aware of the importance of living healthily through these campaigns and started to look for food intolerance products to avoid diabetes.

© Euromonitor International

Passport

36

HEALTH AND W ELLNESS IN MALAYSIA

COMPETITIVE LANDSCAPE  Abbott Laboratories (M) Sdn Bhd led sales with a 33% value share at the end of the review period, and achieved RM5 million in value sales in 2014. The company’s Isomil lactose-free special baby milk formula is a popular brand due to its quality assurance, and could be found on sale in major retail outlets. Isomil offers various lactose-free special baby milk formula products for consumers to choose at relatively low unit prices, such as Isomil Soya Milk Powder 0-12 month, Isomil Plus Milk 1-10 years, Isomil Plus Growing-Up Milk Powder and Isomil Soya Milk Powder.  Bristol-Myers Squibb (M) Sdn Bhd saw the largest value growth increase of 5%, and achieved a 26% value shares with RM4 million in value sales in 2014. The company offers Enfalac A+ Lacto Free Milk Powder at premium prices, with a quality assurance and organised on-going advertising support through social and broadcast media.  The market was dominated by international players such as Abbott Laboratories (M) Sdn Bhd, Nestlé (M) Bhd and Bristol-Myers Squibb (M) Sdn Bhd. This was due to the high levels of investment needed for lactose free special baby milk formula.  There were no significant new product launches in 2014 for food intolerance. The category remained dominated by international players with existing brand offers.  The packaging that manufacturers usually adopt is metal tins, in order to ensure the quality and freshness of the powder contained. Diabetes products are usually produced and sold in powder form. Metal tins also provide convenience for consumers to open and store.  Food intolerance products are usually considered premium offerings rather than standard or economy, due to the high investment in research and development required to produce quality food intolerance products. Private label products remained insignificant in Malaysia at the end of the review period.

PROSPECTS  Food intolerance is expected to see a 1% constant value CAGR over the forecast period. Consumers are constantly demanding food intolerance products due to the health problems many of them face. However, consumers from other groups may start to become aware of the importance of health issues and start to consume food intolerance products.  The growing health consciousness, affected by rising health issues such as diabetes, drives consumers to seek more food intolerance products. Therefore, it is expected that the forecast period will see growth similar to that demonstrated over the review period.  Potential forecast threats to growth include the inflation rate and consumer spending patterns. The increasingly high inflation rate drives up unit prices of commodity products. Therefore, consumers may look for cheaper brands, thereby affecting food intolerance unit selling prices over the forecast period.  Lactose free special baby milk formula is expected to continue growing well over the forecast period. Consumers will continue to purchase this product for their babies, as they become increasingly aware of the importance of choosing the right baby milk formula through the influence of social media, advertising and events organised by government and nongovernmental organisations.  Potential company activities over the forecast period could include price promotions such as discounts, vouchers or gifts, and contests to win cash prizes. As consumers become more

© Euromonitor International

Passport

37

HEALTH AND W ELLNESS IN MALAYSIA

Passport

value conscious, companies may want to organise more cash contests or competitions to stimulate consumption.

CATEGORY DATA Table 31

Sales of Food Intolerance by Category: Value 2009-2014

MYR '000

---- Diabetic Food ----- Diabetic Bakery Products ----- Diabetic Confectionery ------ Diabetic Chocolate Confectionery ------ Diabetic Sugarfree Confectionery ----- Diabetic Spreads excl Honey ---- Gluten-free Food ----- Gluten-Free Bakery Products ----- Gluten-free Baby Food ------ Gluten-Free Dried Baby Food ------ Gluten-Free Prepared Baby Food ------ Gluten-Free Other Baby Food ----- Gluten-free Pasta ----- Gluten-free Ready Meals ---- Lactose-free Food ----- Lactose-Free Dairy ----- Lactose-free Ice Cream ----- Lactose Free Baby Food ------ Lactose-Free Special Baby Milk Formula ---- Other HW Special Baby Milk Formula ----- Other Liquid Special Baby Milk Formula ----- Other Powder Special Baby Milk Formula -- Food Intolerance Source:

Table 32

2009

2010

2011

2012

2013

2014

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

11,694.0 -

12,134.0 -

12,517.1 -

12,966.0 -

13,406.8 -

13,822.4 -

11,694.0

12,134.0

12,517.1

12,966.0

13,406.8

13,822.4

11,694.0

12,134.0

12,517.1

12,966.0

13,406.8

13,822.4

1,590.8

1,642.3

1,672.5

1,720.3

1,770.2

1,819.7

-

-

-

-

-

-

1,590.8

1,642.3

1,672.5

1,720.3

1,770.2

1,819.7

13,284.8

13,776.3

14,189.6

14,686.2

15,177.0

15,642.1

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Sales of Food Intolerance by Category: % Value Growth 2009-2014

% current value growth

© Euromonitor International

38

HEALTH AND W ELLNESS IN MALAYSIA

Passport

---- Diabetic Food ----- Diabetic Bakery Products ----- Diabetic Confectionery ------ Diabetic Chocolate Confectionery ------ Diabetic Sugar-free Confectionery ----- Diabetic Spreads excl Honey ---- Gluten-free Food ----- Gluten-Free Bakery Products ----- Gluten-free Baby Food ------ Gluten-Free Dried Baby Food ------ Gluten-Free Prepared Baby Food ------ Gluten-Free Other Baby Food ----- Gluten-free Pasta ----- Gluten-free Ready Meals ---- Lactose-free Food ----- Lactose-Free Dairy ----- Lactose-free Ice Cream ----- Lactose Free Baby Food ------ Lactose-Free Special Baby Milk Formula ---- Other HW Special Baby Milk Formula ----- Other Liquid Special Baby Milk Formula ----- Other Powder Special Baby Milk Formula -- Food Intolerance Source:

2009-14 CAGR

2009/14 Total

3.1 3.1 3.1

3.4 3.4 3.4

18.2 18.2 18.2

2.8 -

2.7 -

14.4 -

2.8

2.7

14.4

3.1

3.3

17.7

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Table 33

NBO Company Shares of Food Intolerance: % Value 2010-2014

% retail value rsp Company Abbott Laboratories (M) Sdn Bhd Bristol-Myers Squibb (M) Sdn Bhd Nestlé (Malaysia) Bhd Others Total Source:

2013/14

2010

2011

2012

2013

2014

32.7

33.0

33.1

32.9

33.1

23.8

24.6

25.3

25.8

26.2

19.8 23.7 100.0

20.4 22.1 100.0

21.0 20.7 100.0

21.6 19.6 100.0

21.7 18.9 100.0

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Table 34

LBN Brand Shares of Food Intolerance: % Value 2011-2014

% retail value rsp Brand Isomil Enfalac Nan Others

© Euromonitor International

Company

2011

2012

2013

2014

Abbott Laboratories (M) Sdn Bhd Bristol-Myers Squibb (M) Sdn Bhd Nestlé (Malaysia) Bhd

33.0

33.1

32.9

33.1

24.6

25.3

25.8

26.2

20.4 22.1

21.0 20.7

21.6 19.6

21.7 18.9

39

HEALTH AND W ELLNESS IN MALAYSIA

Passport

Total Source:

100.0

100.0

100.0

100.0

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Table 35

Distribution of Food Intolerance by Format: % Value 2009-2014

% retail value rsp

Store-Based Retailing - Grocery Retailers -- Modern Grocery Retailers --- Convenience Stores --- Discounters --- Forecourt Retailers --- Hypermarkets --- Supermarkets -- Traditional Grocery Retailers --- Food/drink/tobacco specialists --- Independent Small Grocers -- Other Grocery Retailers - Non-Grocery Specialists Non-Store Retailing - Vending - Homeshopping - Internet Retailing - Direct Selling Total Source:

2009

2010

2011

2012

2013

2014

100.0 93.8 84.4

100.0 93.8 84.5

100.0 93.8 84.5

100.0 93.8 84.6

100.0 93.8 84.6

100.0 93.8 84.6

3.8 55.3 25.3 4.8

3.8 55.4 25.3 4.8

3.7 55.4 25.4 4.8

3.7 55.5 25.4 4.8

3.6 55.5 25.5 4.8

3.5 55.5 25.6 4.8

-

-

-

-

-

-

4.8

4.8

4.8

4.8

4.8

4.8

4.6

4.5

4.5

4.4

4.4

4.4

6.2 100.0

6.2 100.0

6.2 100.0

6.2 100.0

6.2 100.0

6.2 100.0

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Table 36

Forecast Sales of Food Intolerance by Category: Value 2014-2019

MYR '000

---- Diabetic Food ----- Diabetic Bakery Products ----- Diabetic Confectionery ------ Diabetic Chocolate Confectionery ------ Diabetic Sugarfree Confectionery ----- Diabetic Spreads excl Honey ---- Gluten-free Food ----- Gluten-Free Bakery Products ----- Gluten-free Baby Food

© Euromonitor International

2014

2015

2016

2017

2018

2019

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

40

HEALTH AND W ELLNESS IN MALAYSIA

------ Gluten-Free Dried Baby Food ------ Gluten-Free Prepared Baby Food ------ Gluten-Free Other Baby Food ----- Gluten-free Pasta ----- Gluten-free Ready Meals ---- Lactose-free Food ----- Lactose-Free Dairy ----- Lactose-free Ice Cream ----- Lactose Free Baby Food ------ Lactose-Free Special Baby Milk Formula ---- Other HW Special Baby Milk Formula ----- Other Liquid Special Baby Milk Formula ----- Other Powder Special Baby Milk Formula -- Food Intolerance Source:

Table 37

Passport

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

13,822.4 -

13,946.8 -

14,058.4 -

14,156.8 -

14,241.7 -

14,312.9 -

13,822.4

13,946.8

14,058.4

14,156.8

14,241.7

14,312.9

13,822.4

13,946.8

14,058.4

14,156.8

14,241.7

14,312.9

1,819.7

1,828.8

1,836.1

1,841.7

1,845.3

1,847.2

-

-

-

-

-

-

1,819.7

1,828.8

1,836.1

1,841.7

1,845.3

1,847.2

15,642.1

15,775.6

15,894.5

15,998.5

16,087.1

16,160.1

Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources

Forecast Sales of Food Intolerance by Category: % Value Growth 2014-2019

% constant value growth

---- Diabetic Food ----- Diabetic Bakery Products ----- Diabetic Confectionery ------ Diabetic Chocolate Confectionery ------ Diabetic Sugar-free Confectionery ----- Diabetic Spreads excl Honey ---- Gluten-free Food ----- Gluten-Free Bakery Products ----- Gluten-free Baby Food ------ Gluten-Free Dried Baby Food ------ Gluten-Free Prepared Baby Food ------ Gluten-Free Other Baby Food ----- Gluten-free Pasta ----- Gluten-free Ready Meals ---- Lactose-free Food ----- Lactose-Free Dairy ----- Lactose-free Ice Cream ----- Lactose Free Baby Food ------ Lactose-Free Special Baby Milk Formula ---- Other HW Special Baby Milk Formula ----- Other Liquid Special Baby Milk Formula ----- Other Powder Special Baby Milk Formula -- Food Intolerance

© Euromonitor International

2014/2015

2014-19 CAGR

2014/19 TOTAL

0.5 0.5 0.5

0.7 0.7 0.7

3.5 3.5 3.5

0.1 -

0.3 -

1.5 -

0.1

0.3

1.5

0.5

0.7

3.3

41

HEALTH AND W ELLNESS IN MALAYSIA

Source:

Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources

© Euromonitor International

Passport

42

HEALTH AND W ELLNESS IN MALAYSIA

FORTIFIED/FUNCTIONAL BEVERAGES IN MALAYSIA CATEGORY ANALYSIS HEADLINES  Fortified/functional beverages records current off-trade value growth of 8% in 2014, with sales reaching MYR3 billion  The aggressive introduction of a wide range of different brand variants drives sales in 2014  Fortified/functional sports drinks continues to lead growth in 2014, with current off-trade value sales rising by 14%  Current off-trade unit prices within fortified/functional hot drinks grow by 1% in 2014 while prices within fortified/functional soft drinks decline by less than 1%  Fraser & Neave Holdings continues to lead sales in 2014, recording an off-trade value share of 36%  Fortified/functional beverages has a projected forecast period constant 2014 price value CAGR of 6%, with sales set to reach MYR3.5 billion by 2019

TRENDS  There are many areas offering fortified/functional beverages such as instant coffee, plantbased and malt-based hot drinks, concentrates, energy drinks, juice, RTD tea, RTD coffee and sports drinks. Growing demand for sports drinks and RTD coffee is fuelling sales strongly within fortified/functional beverages.  Fortified/functional beverages recorded current off-trade value growth of 8% in 2014 – in-line with the review period CAGR. Consumers are highly attracted to fortified/functional beverages that provide additional nutritional values like calcium for bone and joint health, vitamins as well as mineral content due to rising health awareness among consumers.  Fortified/functional sports drinks led growth in 2014, with current off-trade value sales rising by 14%. Sports drinks have been widely accepted by all consumers and are popular for their added fortified/functional ingredients such as electrolytes (sodium and potassium), which help replenish the body after exercise.  Normally, consumers are attracted to products which provide an energy boost and aid general wellbeing. Consumers, especially those who work for long hours and are always on the rush, are looking more for energy boosting products to maintain their daily energy levels. Consumers are increasingly opting for general wellbeing beverages due to the fact such products contain different vitamins that are good for health.  The leading functional ingredients offered by manufacturers include vitamins, minerals and calcium, which are easily understood by consumers. For instance, ingredients usually found in non-alcoholic drinks include Vitamin C and Vitamin D for immune support, Vitamin A for vision health and calcium for bone and joint health. Consumers are highly aware of these ingredients due to information provided on packaging.

© Euromonitor International

Passport

43

HEALTH AND W ELLNESS IN MALAYSIA

 The Ministry of Health is very particular regarding ingredients content inside beverages, with manufacturers needing approval from HACCP to ensure beverages offer safety as well as Halal certification and are suitable for Muslims to drink. Manufacturers state HACCP System Certified and Halal logos on packaging after receiving approval in order to reassure consumers.  Explicit health claims are becoming popular in fortified/functional soft drinks and hot drinks as they help consumers better understand ingredients within beverages.  Current off-trade unit prices within fortified/functional hot drinks grew by 1% in 2014 while fortified/functional soft drinks prices declined by less than 1%. Even so, fortified/functional beverages are perceived as expensive ranges compared to regular beverages due to the higher price of healthy ingredients.

COMPETITIVE LANDSCAPE  Fraser & Neave Holdings led sales in 2014, recording an off-trade value share of 36% due to its offering of popular fortified/functional beverages like 100 Plus and Seasons, which come in various variants. In addition, the company organised aggressive marketing campaigns such as re-branding its 100 Plus to cater for other consumer groups instead of only focusing on sports and frequent price discounts.  Fraser & Neave Holdings recorded the biggest increase in value sales in 2014 (to MYR957 million). Aggressive marketing campaigns such as re-branding the 100 Plus brand and frequent price discounts helped to fuel the company’s value sales.  Permanis launched a new variant of its Tropicana Twister with Juicy Burst Peach Flavour in March 2014. This product is popular for its added Vitamin C. In addition, the company used media advertising to introduce the new product.  In Malaysia, fortified/functional claims are relatively important for beverage players as they help to attract consumers.  Milk Specialities recorded a 3% decline in value sales in 2014. While the company offers Nutrigen from unfrozen nectars, the brand is only available via selected channels like internet retailing.

PROSPECTS  Fortified/functional beverages will continue to be offered by manufacturers since these products are widely accepted by consumers, who are well-aware of the advantages of healthy ingredients.  Fortified/functional beverages has a projected forecast period constant 2014 price value CAGR of 6%. Consumers continue to look for more fortified/functional beverages in response to rising health awareness.  Fortified/functional sports drinks will lead growth over the forecast period, with the area having a projected constant 2014 price value CAGR of 10%. Consumers continue to choose more sports drinks as they help to replenish and cool down the body after exercise.  Fortified/functional RTD coffee and instant coffee have the potential to further develop by offering collagen or any other beauty from within ingredients. This is because consumers, especially women, tend to choose the easiest and fastest way to maintain or repair their skin

© Euromonitor International

Passport

44

HEALTH AND W ELLNESS IN MALAYSIA

Passport

and appearance. Therefore, RTD coffee and instant coffee brands with added beauty from within ingredients can attract consumer attention.  Some manufacturers do not claim that their fortified/functional beverages help reduce obesity and heart disease rates as such products typically only help to enhance bone and joint health and general wellbeing or offer beauty from within or immune support properties.  New product launches are expected to perform well in the short term due to rising consumer health awareness and aggressive marketing campaigns like media advertisements and price discounts. Other manufacturers might offer more new variants with added vitamins to gain sales share over the coming years.  It is expected that aggressive price discounts will be offered by large players over the forecast period to attract more consumers. As a result, off-trade unit prices are expected to decline within all areas. Off-trade constant unit prices within hot drinks are expected to fall at a CAGR of 1% while prices within soft drinks are expected to fall at a CAGR of 3%.  Potential threats to forecast period growth include rising inflation, consumer spending patterns and government policy reform. Although consumers understand that better for you beverages are good for health, rising commodity expenditure is resulting in a decline in expenditure on healthy products that are not as essential as commodity products. In addition, the government is looking to implement a goods and service tax in 2015 which may force consumers to spend more carefully over the forecast period.

CATEGORY DATA Table 38

Sales of Fortified/Functional Beverages by Category: Value 2009-2014

MYR million

---- FF Hot Drinks ----- FF Instant Coffee ----- FF Tea ------ FF Fruit/Herbal Tea ------ FF Instant Tea ----- FF Other Hot Drinks ------ FF Chocolatebased Flavoured Powder Drinks ------ FF Plant-based and Malt-based Hot Drinks ---- FF Soft Drinks ----- FF Asian Speciality Drinks ----- FF Bottled Water ----- FF Carbonates ------ FF Cola Carbonates ------ FF Non-Cola Carbonates ----- FF Concentrates ------ FF Liquid Concentrates ------ FF Powder Concentrates ----- FF Energy Drinks ----- FF Fruit/

© Euromonitor International

2009

2010

2011

2012

2013

2014

798.6 159.9 -

832.0 179.8 -

868.5 196.0 -

900.0 210.7 -

934.8 226.9 -

973.3 244.8 -

638.6 -

652.2 -

672.5 -

689.3 -

707.9 -

728.4 -

638.6

652.2

672.5

689.3

707.9

728.4

983.3 -

1,102.8 -

1,215.0 -

1,350.3 -

1,498.2 -

1,660.6 -

-

-

-

-

-

-

138.5 136.6

144.5 142.4

151.1 148.9

159.9 157.6

168.9 166.6

178.2 175.7

1.9

2.1

2.2

2.3

2.4

2.5

176.3 113.6

183.2 135.6

187.0 147.2

192.6 159.2

198.8 171.8

205.6 184.8

45

HEALTH AND W ELLNESS IN MALAYSIA

Vegetable Juice ------ FF 100% Juice ------ FF FruitFlavoured Drinks (No Juice Content) ------ FF Juice Drinks (up to 24% Juice) ------ FF Nectars (2599% Juice) ----- FF RTD Coffee ----- FF RTD Tea ----- FF Sports Drinks --- Fortified/ Functional Beverages Source:

Table 39

Passport

-

-

-

-

-

-

53.1

71.1

78.3

84.1

90.3

96.6

60.5

64.5

68.9

75.1

81.6

88.2

9.4 6.8 538.8 1,781.9

10.3 7.5 621.7 1,934.8

11.3 8.4 710.0 2,083.6

12.6 9.5 816.6 2,250.3

14.0 10.5 934.1 2,433.0

15.6 11.4 1,064.9 2,633.8

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Sales of Fortified/Functional Beverages by Category: % Value Growth 20092014

% current value growth

---- FF Hot Drinks ----- FF Instant Coffee ----- FF Tea ------ FF Fruit/Herbal Tea ------ FF Instant Tea ----- FF Other Hot Drinks ------ FF Chocolate-based Flavoured Powder Drinks ------ FF Plant-based and Malt-based Hot Drinks ---- FF Soft Drinks ----- FF Asian Speciality Drinks ----- FF Bottled Water ----- FF Carbonates ------ FF Cola Carbonates ------ FF Non-Cola Carbonates ----- FF Concentrates ------ FF Liquid Concentrates ------ FF Powder Concentrates ----- FF Energy Drinks ----- FF Fruit/Vegetable Juice ------ FF 100% Juice ------ FF Fruit-Flavoured Drinks (No Juice Content) ------ FF Juice Drinks (up to 24% Juice) ------ FF Nectars (25-99% Juice) ----- FF RTD Coffee ----- FF RTD Tea ----- FF Sports Drinks --- Fortified/Functional Beverages Source:

2013/14

2009-14 CAGR

2009/14 Total

4.1 7.9 2.9 -

4.0 8.9 2.7 -

21.9 53.1 14.1 -

2.9

2.7

14.1

10.8 5.5 5.5 4.0 3.4 7.6 -

11.0 5.2 5.2 6.0 3.1 10.2 -

68.9 28.7 28.6 33.9 16.6 62.8 -

7.0 8.2 11.4 9.0 14.0 8.3

12.7 7.8 10.7 11.1 14.6 8.1

82.0 45.9 66.4 69.5 97.6 47.8

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

© Euromonitor International

46

HEALTH AND W ELLNESS IN MALAYSIA

Table 40

Passport

Key Functional Ingredients in Fortified/Functional Juice Drinks (up to 24% juice): % Breakdown 2009-2014

% retail value rsp

Vitamins A, C, E Source:

2009

2010

2011

2012

2013

2014

100.0

100.0

100.0

100.0

100.0

100.0

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Table 41

Key Functional Ingredients in Fortified/Functional Nectars (25-99% juice): % Breakdown 2009-2014

% retail value rsp

Vitamins A, C, E Source:

2009

2010

2011

2012

2013

2014

100.0

100.0

100.0

100.0

100.0

100.0

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Table 42

Key Functional Ingredients in Fortified/Functional RTD Tea: % Breakdown 2009-2014

% retail value rsp

Antioxidants Source:

2009

2010

2011

2012

2013

2014

100.0

100.0

100.0

100.0

100.0

100.0

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Table 43

NBO Company Shares of Fortified/Functional Beverages: % Value 2010-2014

% retail value rsp Company Fraser & Neave Holdings Bhd Nestlé (Malaysia) Bhd Power Root (M) Sdn Bhd GlaxoSmithKline Consumer Healthcare Sdn Bhd TC Pharmaceutical Industry Co Ltd Barkath Co-Ro Mfg Sdn Bhd Permanis Sdn Bhd Malaysia Milk Sdn Bhd Taisho Pharmaceutical Sdn Bhd Super Food Technology Sdn Bhd Ace Canning Corp Sdn Bhd Associated British Foods Plc Maestro Swiss Chocolate

© Euromonitor International

2010

2011

2012

2013

2014

28.7

31.0

33.3

34.7

36.3

26.7 10.2 9.4

25.5 10.1 9.1

24.2 9.8 8.8

23.0 9.6 8.9

21.9 9.4 8.7

5.4

5.2

5.0

4.8

4.6

3.7 3.2 2.6 1.1

3.5 3.0 2.6 1.0

3.5 3.1 2.7 0.9

3.4 3.2 2.7 0.8

3.3 3.2 2.7 0.8

0.8

0.8

0.7

0.7

0.7

0.6 0.6

0.6 0.6

0.6 0.6

0.6 0.6

0.6 0.5

0.5

0.5

0.4

0.4

0.4

47

HEALTH AND W ELLNESS IN MALAYSIA

Sdn Bhd Sari Incofood Corp PT Quaker Products (M) Sdn Bhd Universal NutriBeverage Sdn Bhd Milk Specialities Sdn Bhd Perusahan Orang Kampung Sdn Bhd Boh Plantations Sdn Bhd Dutch Lady Milk Industries Bhd Spritzer Bhd F&N Coca-Cola (M) Sdn Bhd Others Total Source:

Passport

0.3 0.3

0.3 0.3

0.3 0.2

0.3 0.2

0.3 0.2

0.2

0.2

0.2

0.2

0.2

0.2 0.1

0.1 0.1

0.1 0.1

0.1 0.1

0.1 0.1

0.1 0.3

0.1 0.3

0.1 0.2

0.1 0.1

0.1 -

0.1 5.1 100.0

5.2 100.0

5.1 100.0

5.5 100.0

5.8 100.0

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Table 44

LBN Brand Shares of Fortified/Functional Beverages: % Value 2011-2014

% retail value rsp Brand 100 Plus Milo Alicafé Ribena

Red Bull Horlicks

Sunquick Peel Fresh 7-Up Revive Power Root Per'l Café Excel Livita Super Isomax Ovaltine Nestum Seasons Vico Indocafe Quaker Sun Up

© Euromonitor International

Company

2011

2012

2013

2014

Fraser & Neave Holdings Bhd Nestlé (Malaysia) Bhd Power Root (M) Sdn Bhd GlaxoSmithKline Consumer Healthcare Sdn Bhd TC Pharmaceutical Industry Co Ltd GlaxoSmithKline Consumer Healthcare Sdn Bhd Barkath Co-Ro Mfg Sdn Bhd Malaysia Milk Sdn Bhd Permanis Sdn Bhd Power Root (M) Sdn Bhd Power Root (M) Sdn Bhd Permanis Sdn Bhd Taisho Pharmaceutical Sdn Bhd Super Food Technology Sdn Bhd Ace Canning Corp Sdn Bhd Associated British Foods Plc Nestlé (Malaysia) Bhd Fraser & Neave Holdings Bhd Maestro Swiss Chocolate Sdn Bhd Sari Incofood Corp PT Quaker Products (M) Sdn Bhd Universal NutriBeverage Sdn Bhd

29.7

31.8

33.9

35.9

25.0 6.2 4.4

23.7 6.1 4.3

22.5 6.0 4.6

21.4 6.0 4.6

5.2

5.0

4.8

4.6

4.7

4.5

4.3

4.1

3.5 2.6 2.1 2.2 1.6 1.0 1.0

3.5 2.7 2.1 2.1 1.6 1.0 0.9

3.4 2.7 2.2 2.0 1.5 1.0 0.8

3.3 2.7 2.3 2.0 1.4 0.9 0.8

0.8

0.7

0.7

0.7

0.6 0.6

0.6 0.6

0.6 0.6

0.6 0.5

0.5 0.4

0.5 0.4

0.5 0.4

0.5 0.4

0.5

0.4

0.4

0.4

0.3 0.3

0.3 0.2

0.3 0.2

0.3 0.2

0.2

0.2

0.2

0.2

48

HEALTH AND W ELLNESS IN MALAYSIA

Nutrigen Orang Kampung

Milk Specialities Sdn Bhd Perusahan Orang Kampung Sdn Bhd Boh Plantations Sdn Bhd Fraser & Neave Holdings Bhd Dutch Lady Milk Industries Bhd F&N Coca-Cola (M) Sdn Bhd F&N Coca-Cola (M) Sdn Bhd Nestlé (Malaysia) Bhd

Boh Sunkist Joy 100 Plus Seasons Nestomalt Others Total Source:

Passport

0.1 0.1

0.1 0.1

0.1 0.1

0.1 0.1

0.1 0.9

0.1 1.0

0.1 0.4

0.1 -

0.3

0.2

0.1

-

5.2 100.0

5.1 100.0

5.5 100.0

5.8 100.0

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Table 45

Distribution of Fortified/Functional Beverages by Format: % Value 2009-2014

% retail value rsp

Store-Based Retailing - Grocery Retailers -- Modern Grocery Retailers --- Convenience Stores --- Discounters --- Forecourt Retailers --- Hypermarkets --- Supermarkets -- Traditional Grocery Retailers --- Food/drink/tobacco specialists --- Independent Small Grocers -- Other Grocery Retailers - Non-Grocery Specialists Non-Store Retailing - Vending - Homeshopping - Internet Retailing - Direct Selling Total Source:

2009

2010

2011

2012

2013

2014

98.4 98.4 70.4

98.4 98.4 70.2

98.4 98.4 70.3

98.4 98.4 70.6

98.3 98.3 70.8

98.3 98.3 71.0

8.5 3.5 49.0 9.4 24.1

8.5 3.0 49.1 9.6 24.3

8.3 2.9 49.3 9.8 24.3

8.3 2.8 49.5 10.0 24.2

8.3 2.8 49.5 10.2 24.0

8.3 2.8 49.5 10.4 23.8

-

-

-

-

-

-

24.1

24.3

24.3

24.2

24.0

23.8

3.9

3.9

3.8

3.6

3.5

3.5

1.6 1.5 0.1 100.0

1.6 1.5 0.1 100.0

1.6 1.5 0.1 100.0

1.6 1.4 0.2 100.0

1.6 1.4 0.3 100.0

1.7 1.4 0.3 100.0

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Table 46

Key Functional Ingredients in Fortified/Functional RTD Tea: % Breakdown 2009-2014

% retail value rsp

Antioxidants Source:

2009

2010

2011

2012

2013

2014

100.0

100.0

100.0

100.0

100.0

100.0

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

© Euromonitor International

49

HEALTH AND W ELLNESS IN MALAYSIA

Table 47

NBO Company Shares of Fortified/Functional Beverages: % Value 2010-2014

% retail value rsp Company Fraser & Neave Holdings Bhd Nestlé (Malaysia) Bhd Power Root (M) Sdn Bhd GlaxoSmithKline Consumer Healthcare Sdn Bhd TC Pharmaceutical Industry Co Ltd Barkath Co-Ro Mfg Sdn Bhd Permanis Sdn Bhd Malaysia Milk Sdn Bhd Taisho Pharmaceutical Sdn Bhd Super Food Technology Sdn Bhd Ace Canning Corp Sdn Bhd Associated British Foods Plc Maestro Swiss Chocolate Sdn Bhd Sari Incofood Corp PT Quaker Products (M) Sdn Bhd Universal NutriBeverage Sdn Bhd Milk Specialities Sdn Bhd Perusahan Orang Kampung Sdn Bhd Boh Plantations Sdn Bhd Dutch Lady Milk Industries Bhd Spritzer Bhd F&N Coca-Cola (M) Sdn Bhd Others Total Source:

Passport

2010

2011

2012

2013

2014

28.7

31.0

33.3

34.7

36.3

26.7 10.2 9.4

25.5 10.1 9.1

24.2 9.8 8.8

23.0 9.6 8.9

21.9 9.4 8.7

5.4

5.2

5.0

4.8

4.6

3.7 3.2 2.6 1.1

3.5 3.0 2.6 1.0

3.5 3.1 2.7 0.9

3.4 3.2 2.7 0.8

3.3 3.2 2.7 0.8

0.8

0.8

0.7

0.7

0.7

0.6 0.6

0.6 0.6

0.6 0.6

0.6 0.6

0.6 0.5

0.5

0.5

0.4

0.4

0.4

0.3 0.3

0.3 0.3

0.3 0.2

0.3 0.2

0.3 0.2

0.2

0.2

0.2

0.2

0.2

0.2 0.1

0.1 0.1

0.1 0.1

0.1 0.1

0.1 0.1

0.1 0.3

0.1 0.3

0.1 0.2

0.1 0.1

0.1 -

0.1 5.1 100.0

5.2 100.0

5.1 100.0

5.5 100.0

5.8 100.0

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Table 48

LBN Brand Shares of Fortified/Functional Beverages: % Value 2011-2014

% retail value rsp Brand 100 Plus Milo Alicafé Ribena

© Euromonitor International

Company

2011

2012

2013

2014

Fraser & Neave Holdings Bhd Nestlé (Malaysia) Bhd Power Root (M) Sdn Bhd GlaxoSmithKline Consumer Healthcare Sdn Bhd

29.7

31.8

33.9

35.9

25.0 6.2 4.4

23.7 6.1 4.3

22.5 6.0 4.6

21.4 6.0 4.6

50

HEALTH AND W ELLNESS IN MALAYSIA

Red Bull

TC Pharmaceutical Industry Co Ltd GlaxoSmithKline Consumer Healthcare Sdn Bhd Barkath Co-Ro Mfg Sdn Bhd Malaysia Milk Sdn Bhd Permanis Sdn Bhd Power Root (M) Sdn Bhd Power Root (M) Sdn Bhd Permanis Sdn Bhd Taisho Pharmaceutical Sdn Bhd Super Food Technology Sdn Bhd Ace Canning Corp Sdn Bhd Associated British Foods Plc Nestlé (Malaysia) Bhd Fraser & Neave Holdings Bhd Maestro Swiss Chocolate Sdn Bhd Sari Incofood Corp PT Quaker Products (M) Sdn Bhd Universal NutriBeverage Sdn Bhd Milk Specialities Sdn Bhd Perusahan Orang Kampung Sdn Bhd Boh Plantations Sdn Bhd Fraser & Neave Holdings Bhd Dutch Lady Milk Industries Bhd F&N Coca-Cola (M) Sdn Bhd F&N Coca-Cola (M) Sdn Bhd Nestlé (Malaysia) Bhd

Horlicks

Sunquick Peel Fresh 7-Up Revive Power Root Per'l Café Excel Livita Super Isomax Ovaltine Nestum Seasons Vico Indocafe Quaker Sun Up Nutrigen Orang Kampung Boh Sunkist Joy 100 Plus Seasons Nestomalt Others Total Source:

Passport

5.2

5.0

4.8

4.6

4.7

4.5

4.3

4.1

3.5 2.6 2.1 2.2 1.6 1.0 1.0

3.5 2.7 2.1 2.1 1.6 1.0 0.9

3.4 2.7 2.2 2.0 1.5 1.0 0.8

3.3 2.7 2.3 2.0 1.4 0.9 0.8

0.8

0.7

0.7

0.7

0.6 0.6

0.6 0.6

0.6 0.6

0.6 0.5

0.5 0.4

0.5 0.4

0.5 0.4

0.5 0.4

0.5

0.4

0.4

0.4

0.3 0.3

0.3 0.2

0.3 0.2

0.3 0.2

0.2

0.2

0.2

0.2

0.1 0.1

0.1 0.1

0.1 0.1

0.1 0.1

0.1 0.9

0.1 1.0

0.1 0.4

0.1 -

0.3

0.2

0.1

-

5.2 100.0

5.1 100.0

5.5 100.0

5.8 100.0

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Table 49

Distribution of Fortified/Functional Beverages by Format: % Value 2009-2014

% retail value rsp

Store-Based Retailing - Grocery Retailers -- Modern Grocery Retailers --- Convenience Stores --- Discounters --- Forecourt Retailers --- Hypermarkets --- Supermarkets -- Traditional Grocery

© Euromonitor International

2009

2010

2011

2012

2013

2014

98.4 98.4 70.4

98.4 98.4 70.2

98.4 98.4 70.3

98.4 98.4 70.6

98.3 98.3 70.8

98.3 98.3 71.0

8.5 3.5 49.0 9.4 24.1

8.5 3.0 49.1 9.6 24.3

8.3 2.9 49.3 9.8 24.3

8.3 2.8 49.5 10.0 24.2

8.3 2.8 49.5 10.2 24.0

8.3 2.8 49.5 10.4 23.8

51

HEALTH AND W ELLNESS IN MALAYSIA

Retailers --- Food/drink/tobacco specialists --- Independent Small Grocers -- Other Grocery Retailers - Non-Grocery Specialists Non-Store Retailing - Vending - Homeshopping - Internet Retailing - Direct Selling Total Source:

Passport

-

-

-

-

-

-

24.1

24.3

24.3

24.2

24.0

23.8

3.9

3.9

3.8

3.6

3.5

3.5

1.6 1.5 0.1 100.0

1.6 1.5 0.1 100.0

1.6 1.5 0.1 100.0

1.6 1.4 0.2 100.0

1.6 1.4 0.3 100.0

1.7 1.4 0.3 100.0

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

© Euromonitor International

52

HEALTH AND W ELLNESS IN MALAYSIA

FORTIFIED/FUNCTIONAL PACKAGED FOOD IN MALAYSIA - CATEGORY ANALYSIS HEADLINES  Fortified/functional packaged food sees 8% current value growth to reach RM4.9 billion in 2014  Demand increases as consumers become health conscious and many products meet requirements  Pro/pre biotic fruited spoonable yoghurt most dynamic with 12% current value growth in 2014  Unit price increases for all categories in fortified/functional packaged food  Nestlé (M) Bhd leads pro/pre biotic fruited spoonable yoghurt with 51% value share  Fortified/functional packaged food expected to see 6% constant value CAGR over forecast period

TRENDS  Consumers are very familiar with fortified/functional ingredients such as multivitamins, calcium and minerals. There are many product categories offering fortified/functional ingredients, for instance, yoghurt, cheese, breakfast bars and confectionery. Consequently such products are commonly found in modern and traditional grocery retail outlets at affordable prices.  Fortified/functional packaged food grew slower in 2014 compared with the review period as a whole. This was due to intense competition between players in terms of unit selling price and promotion. Aggressive price discounts and bundle sales were organised by companies to gain consumer attention in 2014. Consumers became value conscious regarding fortified/functional products as there were many brands and products available.  As long as fortified/functional packaged food is generally Halal certified, Muslim consumers could able to consume it. Companies must follow the Food Act 1983 and Food Regulation 1985, Control of Drugs and Cosmetics Regulation 1984 and Halal laws and regulations. There is no fortified/functional packaged food regulation in Malaysia, the same situation as in other countries such as Singapore, Thailand, Indonesia and Myanmar. When regulatory approval is introduced manufacturers could benefit by gaining share as consumers become more confident in purchasing fortified/functional packaged food. Furthermore, manufacturers could advertise fortified/functional ingredients on packaging as well as organise media advertising support regarding the permitted added ingredients.  Pro/pre biotic fruited spoonable yoghurt saw the fastest value growth of 12% in current value terms in 2014. There are wide ranges of pro/pre biotic fruited spoonable yoghurt brands and variants on offer. Fruited spoonable yoghurt is widely perceived as being beneficial to the immune system and enhancing intestinal regularity. Consequently it helps to manage weight, as well as promoting cardiovascular and oral health.  Prebiotics are widely perceived as helping to support the immune system, digestive health and weight management, driving sales of pro/prebiotic yoghurt. Consequently, pre/prebiotic

© Euromonitor International

Passport

53

HEALTH AND W ELLNESS IN MALAYSIA

yoghurt has gained share in packaged food. There are no regulatory changes affecting sales of pre/probiotic yoghurt in Malaysia. In addition, there were no new innovations outside yoghurt in Malaysia in 2014, and a lack of prebiotic yoghurts emerged as the category remains dominated by existing players.  Another health trend is bone and joint health, which drives awareness among consumers, especially adults and elderly people. Consumers prefer products such as yoghurt, cheese, chewing gum and milk drinks, which are high in calcium content, which helps to enhance bone and joint health. Furthermore, heart health is another important factors encouraging consumers to eat more hot cereals products, especially the elderly. Consumers are concentrating more on heart health due to the increasing frequency of heart-related diseases in Malaysia. The healthy ingredients usually contained in hot cereals include protein, dietary fibre, calcium, fatty acids and sodium.  Pro/pre biotic remains the leading functional ingredients with around a 99% value share in dairy-based yoghurt in 2014, providing immune support and digestive health. Manufacturers tend to organise frequent media advertising, roadshows and disseminate nutritional information through social media to reach as many consumers as possible, promoting the advantages of pro/pre biotic ingredients.  Unit prices increased for all categories in fortified/functional packaged food. Fortified/functional packaged food was becoming more expensive towards the end of the review period due to the high investment costs needed to create tastier variants to satisfy consumers’ demands. Meanwhile, private label products remained inactive in terms of introducing fortified/functional ingredients such as vitamins and minerals. Instead, manufacturers continued to offer products at unit prices affordable to all consumers.

COMPETITIVE LANDSCAPE  In pro/pre biotic fruited spoonable yoghurt Nestlé (M) Bhd led sales with a 51% value share and sales worth RM20 million in 2014. The company was offering general well-being as the core health and wellness positioning.  The successful manufacturers’ strategies in the fortified/functional food arena include offering quality taste with added fortified/functional ingredients and a focus on consumers’ health. Manufacturers are always considering consumers’ health and creating products that suit to consumers’ needs. For instance, the increasing importance of physical appearance drives manufacturers to create more digestive health and immune system-supporting products that also help consumers to manage their weight. Therefore, manufacturers are offering wide ranges of brands and variants of drinking yoghurt and spoonable yoghurt. Manufacturers are also advertising the health claims in media advertisements and stating such claims on packaging in order to attract more consumer attention.  There is no legislation in place regarding stating functional ingredients on packaging, but the permitted ingredients stated on food labels include vitamins, calcium, dietary fibre and fatty acids. Stating health claims on packaging has helped drive better sales for particular categories, namely yoghurt and cheese products.  Similac Gain Plus (Intelli-Pro) was introduced by Abbott Laboratories (M) Sdn Bhd in functional toddler milk formula in September 2013. This product targets children aged one to three and young children as well. This product is made from Intelli-Pro which is formulated with DHA, lutein and a unique blend of vegetable oil. Hence, this is positioned as a premium brand and for brain health and development. Consequently, this new launch led to unit selling price increases as it commands a premium price.

© Euromonitor International

Passport

54

HEALTH AND W ELLNESS IN MALAYSIA

Passport

PROSPECTS  Consumers are increasingly choosing more fortified/functional packaged food such as products containing vitamins and minerals due to affordability and widespread offer. Fortified/functional packaged food is expected to see a 6% constant value CAGR over the forecast period. It is expected that growth will continue to rise due to health awareness among consumers. Furthermore, companies may organise roadshows, media advertising, events and promotions in major retail outlets to educate consumers and spread the advantages of fortified/functional packaged food.  The prime positioning categories that are expected to see the largest development potential include beauty from within, immune support and digestive health. As consumers are becoming more conscious of their appearance, they may tend to purchase more healthy products that help to manage weight, are easy to digest and help to enhance skin beauty.  The potential forecast threats to growth include the inflation rate, consumers’ spending habits and government reform policies. The increasingly high inflation rate drives up unit selling prices for commodity products, and consumer spending on non-essential products may be adversely affected. Furthermore, government reform policies by implementing the goods and service tax in 2015 is likely to lead to consumers spending more carefully.  Other factors driving/constraining overall category growth over the forecast period include growing demand for other categories such as organic products which have adopted strong distribution.

CATEGORY DATA Table 50

Sales of Fortified/Functional Packaged Food by Category: Value 2009-2014

MYR million

------ FF Sugar-free Confectionery ------ FF Sugarised Sugar Confectionery ---- FF Baby Food ----- FF Milk Formula ----- FF Prepared Baby Food ---- FF Bakery Products ----- FF Biscuits ----- FF Breakfast Cereals ----- FF Bread ---- FF Confectionery ----- FF Chocolate Confectionery ----- FF Chewing Gum ------ FF Sugar-free Chewing Gum ------ FF Sugarised Chewing Gum ----- FF Sugar

© Euromonitor International

2009

2010

2011

2012

2013

2014

42.1

44.5

46.3

47.7

49.2

50.8

95.9

99.0

102.2

104.7

107.2

109.7

1,116.0 1,116.0 -

1,204.9 1,204.9 -

1,276.0 1,276.0 -

1,355.4 1,355.4 -

1,443.3 1,443.3 -

1,539.0 1,539.0 -

394.6 83.2 112.6

410.1 88.2 117.1

428.3 90.9 121.4

450.9 95.0 126.7

473.2 99.0 132.0

488.5 103.0 137.3

198.9 171.9 7.7

204.8 178.9 8.0

215.9 185.3 8.2

229.2 190.7 8.5

242.2 196.2 8.8

248.3 201.7 9.0

26.3 26.3

27.5 27.5

28.6 28.6

29.8 29.8

31.0 31.0

32.1 32.1

-

-

-

-

-

-

138.0

143.5

148.5

152.5

156.5

160.5

55

HEALTH AND W ELLNESS IN MALAYSIA

Confectionery ---- FF Dairy ----- FF Cheese ----- FF Dairy-based Chilled and Shelf Stable Desserts ----- FF Flavoured Milk Drinks ----- FF Fromage Frais and Quark ----- FF Milk ------ FF Reduced Fat Milk ------ FF Standard Milk ----- FF Powder Milk ----- FF Dairy-based Yoghurt ------ FF Drinking Yoghurt ------ FF Spoonable Yoghurt ------ Total Pro/Pre Biotic Yoghurt ---- FF Meal Replacement ----- Convalescence ----- Meal Replacement Slimming ---- FF Noodles ---- FF Oils and Fats ----- FF Spreadable Oils and Fats ------ Fortified Spreadable Oils and Fats ------ Functional Spreadable Oils and Fats ----- FF Vegetable and Seed Oil ---- FF Pasta ---- FF Soup ---- FF Snack Bars ----- FF Breakfast Bars ----- FF Energy and Nutrition Bars ------ Protein Bars ------ Other Energy/ Nutrition Bars --- Fortified/ Functional Packaged Food Source:

Table 51

Passport

898.7 53.5 -

982.0 57.4 -

1,078.4 60.5 -

1,175.7 64.2 -

1,275.7 67.8 -

1,357.1 71.5 -

234.2

258.6

279.4

304.3

334.1

357.8

-

-

-

-

-

-

105.0 63.5

112.6 68.2

121.2 73.1

132.0 79.2

142.7 85.4

152.5 90.7

41.5 167.1 339.0

44.4 180.0 373.4

48.2 190.8 426.4

52.7 199.2 476.1

57.3 208.8 522.3

61.9 219.2 556.0

304.8

337.1

386.7

432.8

475.1

504.2

34.2

36.3

39.8

43.3

47.3

51.7

301.2

333.1

381.9

427.7

470.5

500.5

288.6 25.7 262.8

380.6 27.0 353.5

468.4 30.0 438.4

576.7 32.7 544.0

714.9 34.4 680.5

875.5 36.2 839.3

308.2 -

364.4 -

375.8 -

387.7 -

400.9 -

415.4 -

-

-

-

-

-

-

-

-

-

-

-

-

308.2

364.4

375.8

387.7

400.9

415.4

0.9 0.6 0.4

1.0 0.6 0.4

1.0 0.6 0.4

1.0 0.6 0.4

1.0 0.7 0.4

1.1 0.7 0.4

0.4 -

0.4 -

0.4 -

0.4 -

0.4 -

0.4 -

3,179.0

3,521.8

3,813.1

4,138.2

4,505.4

4,878.2

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Sales of Fortified/Functional Packaged Food by Category: % Value Growth 2009-2014

% current value growth

------ FF Sugar-free Confectionery ------ FF Sugarised Sugar Confectionery

© Euromonitor International

2013/14

2009-14 CAGR

2009/14 Total

3.2 2.3

3.8 2.7

20.7 14.4

56

HEALTH AND W ELLNESS IN MALAYSIA

Passport

---- FF Baby Food ----- FF Milk Formula ----- FF Prepared Baby Food ---- FF Bakery Products ----- FF Biscuits ----- FF Breakfast Cereals ----- FF Bread ---- FF Confectionery ----- FF Chocolate Confectionery ----- FF Chewing Gum ------ FF Sugar-free Chewing Gum ------ FF Sugarised Chewing Gum ----- FF Sugar Confectionery ---- FF Dairy ----- FF Cheese ----- FF Dairy-based Chilled and Shelf Stable Desserts ----- FF Flavoured Milk Drinks ----- FF Fromage Frais and Quark ----- FF Milk ------ FF Reduced Fat Milk ------ FF Standard Milk ----- FF Powder Milk ----- FF Dairy-based Yoghurt ------ FF Drinking Yoghurt ------ FF Spoonable Yoghurt ------ Total Pro/Pre Biotic Yoghurt ---- FF Meal Replacement ----- Convalescence ----- Meal Replacement Slimming ---- FF Noodles ---- FF Oils and Fats ----- FF Spreadable Oils and Fats ------ Fortified Spreadable Oils and Fats ------ Functional Spreadable Oils and Fats ----- FF Vegetable and Seed Oil ---- FF Pasta ---- FF Soup ---- FF Snack Bars ----- FF Breakfast Bars ----- FF Energy and Nutrition Bars ------ Protein Bars ------ Other Energy/Nutrition Bars --- Fortified/Functional Packaged Food Source:

6.6 6.6 3.2 4.0 4.0 2.5 2.8 3.2 3.8 3.8 2.6 6.4 5.5 -

6.6 6.6 4.4 4.4 4.1 4.5 3.2 3.4 4.1 4.1 3.1 8.6 6.0 -

37.9 37.9 23.8 23.8 22.0 24.8 17.3 18.2 22.2 22.2 16.3 51.0 33.8 -

7.1 6.9 6.2 8.0 5.0 6.4 6.1 9.5 6.4 22.5 5.0 23.3 3.6 -

8.8 7.8 7.4 8.3 5.6 10.4 10.6 8.6 10.7 24.9 7.0 26.1 6.1 -

52.8 45.3 42.9 49.0 31.2 64.0 65.4 51.3 66.2 203.4 40.5 219.3 34.8 -

-

-

-

3.6 2.5 3.0 1.7 1.7 8.3

6.1 2.5 3.1 1.4 1.4 8.9

34.8 13.1 16.7 7.2 7.2 53.4

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Table 52

Key Functional Ingredients in Fortified/Functional Biscuits: % Breakdown 2009-2014

% retail value rsp

Calcium with/without vitamin D Vitamins and minerals

© Euromonitor International

2009

2010

2011

2012

2013

2014

44.3

46.6

46.4

46.2

46.3

46.4

55.7

53.4

53.6

53.8

53.7

53.6

57

HEALTH AND W ELLNESS IN MALAYSIA

Source:

Passport

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Table 53

Key Functional Ingredients in Fortified/Functional Breakfast Cereals: % Breakdown 2009-2014

% retail value rsp

Fibre Vitamins & Minerals Source:

2009

2010

2011

2012

2013

2014

3.4 96.7

2.9 97.2

2.8 97.2

2.8 97.3

2.8 97.2

2.9 97.1

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Table 54

Key Functional Ingredients in Fortified/Functional Bread: % Breakdown 20092014

% retail value rsp

Vitamins & Minerals Source:

2009

2010

2011

2012

2013

2014

100.0

100.0

100.0

100.0

100.0

100.0

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Table 55

Key Functional Ingredients in Fortified/Functional Chocolate Confectionery: % Breakdown 2009-2014

% retail value rsp

Actigen-E Antioxidants Source:

2009

2010

2011

2012

2013

2014

84.9 3.0

85.0 3.0

85.6 2.9

85.9 2.8

86.0 2.8

86.1 2.9

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Table 56

Key Functional Ingredients in Fortified/Functional Chewing Gum: % Breakdown 2009-2014

% retail value rsp

Xylitol Source:

2009

2010

2011

2012

2013

2014

100.0

100.0

100.0

100.0

100.0

100.0

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Table 57

Key Functional Ingredients in Fortified/Functional Sugar Confectionery: % Breakdown 2009-2014

% retail value rsp

Eucalyptus

© Euromonitor International

2009

2010

2011

2012

2013

2014

10.5

10.2

9.8

9.5

9.4

9.3

58

HEALTH AND W ELLNESS IN MALAYSIA

Herb extracts Menthol Source:

Passport

54.5 35.0

55.0 34.8

55.5 34.7

55.4 35.2

55.3 35.2

55.2 35.3

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Table 58

Key Functional Ingredients in Flavoured Milk Drinks: % Breakdown 2009-2014

% retail value rsp

Calcium Vitamins and Minerals Source:

2009

2010

2011

2012

2013

2014

5.1 94.9

5.3 94.8

5.2 94.9

5.1 95.0

5.0 95.0

4.9 95.1

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Table 59

Key Functional Ingredients in Fortified/Functional Milk: % Breakdown 20092014

% retail value rsp

Calcium with/without vitamin D Omega-3 Plant sterols/stanols/ esters Vitamins & Minerals Source:

2009

2010

2011

2012

2013

2014

4.4

4.3

4.1

3.9

3.7

3.6

23.7 -

23.7 -

23.8 -

24.0 0.0

24.0 0.1

24.0 0.1

71.9

72.1

72.1

72.2

72.2

72.3

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Table 60

Key Functional Ingredients in Fortified/Functional Dairy-based Yoghurt: % Breakdown 2009-2014

% retail value rsp

Calcium with/without vitamin D Pro/pre biotic Source:

2009

2010

2011

2012

2013

2014

1.8

1.7

1.6

1.5

1.4

1.3

98.2

98.3

98.4

98.5

98.6

98.7

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Table 61

NBO Company Shares of Fortified/Functional Packaged Food: % Value 20102014

% retail value rsp Company Dutch Lady Milk Industries Bhd Nestlé (Malaysia) Bhd Herbalife Products (M) Sdn Bhd

© Euromonitor International

2010

2011

2012

2013

2014

14.5

14.4

14.3

14.5

14.4

14.8 5.7

14.5 6.4

14.1 8.0

12.8 9.6

12.4 11.4

59

HEALTH AND W ELLNESS IN MALAYSIA

Danone Dumex (M) Sdn Bhd Fonterra Brands (M) Sdn Bhd Bristol-Myers Squibb (M) Sdn Bhd Malaysia Milk Sdn Bhd Nu Skin (M) Sdn Bhd Lam Soon (M) Bhd Abbott Laboratories (M) Sdn Bhd Mondelez (M) Sales Sdn Bhd Gardenia Bakery KL Sdn Bhd Yakult (M) Sdn Bhd Italian Baker Sdn Bhd, The Wyeth (M) Sdn Bhd Lofthouse of Fleetwood Ltd Amway (M) Sdn Bhd Ricola Asia Pacific Pte Ltd Stanson Bakeries Sdn Bhd USANA Health Sciences Sdn Bhd Snow Brand Marketing Sdn Bhd Kellogg Asia Marketing Inc Yee Lee Edible Oils Sdn Bhd Fraser & Neave Holdings Bhd Mamee-Double Decker Properties Sdn Bhd Hacks (M) Sdn Bhd Enseval Megatrading (M) Sdn Bhd Munchy Food Industries Sdn Bhd Nin Jiom Medicine Mfy (Hong Kong) Ltd Hup Seng Perusahaan Makanan (M) Sdn Bhd Kraft Foods (M) Sdn Bhd Mamee-Double Decker (M) Bhd Others Total Source:

Passport

10.3 6.2

10.1 6.1

9.9 5.9

10.2 5.7

10.1 5.6

4.3

4.4

4.6

4.7

4.7

3.9 2.7 4.1 3.2

4.1 3.5 4.1 3.1

4.3 3.6 4.1 3.0

4.3 3.9 4.1 3.2

4.2 4.1 4.1 3.0

-

-

-

3.0

2.9

3.8

3.5

2.3

2.3

2.2

1.5 -

1.8 0.2

1.9 1.6

1.9 1.9

1.9 1.8

2.0 1.1

2.0 1.0

1.9 1.0

1.7 0.9

1.6 0.9

0.7 0.9

0.7 0.9

0.7 0.9

0.7 0.8

0.8 0.8

1.6 0.6

1.5 0.6

1.3 0.6

0.9 0.6

0.7 0.6

0.7

0.7

0.6

0.6

0.6

0.7

0.7

0.6

0.6

0.6

0.7

0.7

0.6

0.6

0.5

0.5

0.5

0.5

0.5

0.5

-

-

-

0.5

0.5

0.4 0.2

0.4 0.2

0.3 0.2

0.3 0.2

0.3 0.2

0.2

0.2

0.2

0.2

0.2

0.2

0.2

0.2

0.2

0.2

0.1

0.1

0.1

0.1

0.0

3.4 0.5

3.3 0.5

3.2 0.5

-

-

10.5 100.0

9.8 100.0

9.1 100.0

8.6 100.0

8.2 100.0

2013

2014

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Table 62

LBN Brand Shares of Fortified/Functional Packaged Food: % Value 20112014

% retail value rsp Brand

© Euromonitor International

Company

2011

2012

60

HEALTH AND W ELLNESS IN MALAYSIA

Dutch Lady Herbalife Dumex Pharmanex Naturel Vitagen Lactogen Anlene Nestlé Milo Gardenia Enfagrow Yakult Massimo Anmum Nespray Enfakid Fisherman's Friend PediaSure Kraft Singles Jacob's Positrim Ricola Koko Krunch High 5 Nutrimeal Gain Grow Dentyne Enfapro Neslac Jacob's Kraft Singles Dentyne Others Total Source:

Dutch Lady Milk Industries Bhd Herbalife Products (M) Sdn Bhd Danone Dumex (M) Sdn Bhd Nu Skin (M) Sdn Bhd Lam Soon (M) Bhd Malaysia Milk Sdn Bhd Nestlé (Malaysia) Bhd Fonterra Brands (M) Sdn Bhd Nestlé (Malaysia) Bhd Nestlé (Malaysia) Bhd Gardenia Bakery KL Sdn Bhd Bristol-Myers Squibb (M) Sdn Bhd Yakult (M) Sdn Bhd Italian Baker Sdn Bhd, The Fonterra Brands (M) Sdn Bhd Nestlé (Malaysia) Bhd Bristol-Myers Squibb (M) Sdn Bhd Lofthouse of Fleetwood Ltd Abbott Laboratories (M) Sdn Bhd Mondelez (M) Sales Sdn Bhd Mondelez (M) Sales Sdn Bhd Amway (M) Sdn Bhd Ricola Asia Pacific Pte Ltd Nestlé (Malaysia) Bhd Stanson Bakeries Sdn Bhd USANA Health Sciences Sdn Bhd Abbott Laboratories (M) Sdn Bhd Abbott Laboratories (M) Sdn Bhd Mondelez (M) Sales Sdn Bhd Bristol-Myers Squibb (M) Sdn Bhd Nestlé (Malaysia) Bhd Kraft Foods (M) Sdn Bhd Kraft Foods (M) Sdn Bhd Kraft Foods (M) Sdn Bhd

Passport

14.1

14.1

14.3

14.2

6.4

8.0

9.6

11.4

8.8 3.5 4.1 3.8 3.7 3.3

8.7 3.6 4.1 3.9 3.5 3.2

9.0 3.9 4.1 4.0 3.4 3.1

9.0 4.1 4.1 3.9 3.3 3.0

2.8 2.4 3.5 1.8

3.0 2.4 2.3 1.9

3.0 2.4 2.3 2.0

3.0 2.4 2.2 2.0

1.8 0.2 1.7

1.9 1.6 1.6

1.9 1.9 1.6

1.9 1.8 1.5

1.4 0.9

1.2 0.9

1.3 1.0

1.2 1.0

1.0 0.8

1.0 0.8

0.9 0.9

0.9 0.8

0.7 0.9

0.7 0.9

0.8 0.9 0.7 0.8

0.8 0.8 0.8 0.8

0.9 1.5 0.6

0.8 1.3 0.6

0.8 0.9 0.6

0.8 0.7 0.6

0.6

0.6

0.6

0.6

0.6

0.6

0.6

0.6

0.6

0.6

0.6 0.6

0.6 0.6

1.2 1.0 0.9 0.7 23.9 100.0

1.2 0.9 0.8 0.6 22.7 100.0

21.6 100.0

20.7 100.0

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Table 63

LBN Brand Shares of Fortified/Functional Bread: % Value 2011-2014

% retail value rsp Brand

Company

2011

2012

2013

2014

Gardenia Massimo High 5

Gardenia Bakery KL Sdn Bhd Italian Baker Sdn Bhd, The Stanson Bakeries Sdn Bhd

62.5 4.4 26.2

41.4 28.8 23.3

42.9 34.5 16.3

43.8 35.9 14.1

© Euromonitor International

61

HEALTH AND W ELLNESS IN MALAYSIA

Passport

Others Total Source:

6.9 100.0

6.5 100.0

6.3 100.0

6.2 100.0

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Table 64

Distribution of Fortified/Functional Packaged Food by Format: % Value 20092014

% retail value rsp

Store-Based Retailing - Grocery Retailers -- Modern Grocery Retailers --- Convenience Stores --- Discounters --- Forecourt Retailers --- Hypermarkets --- Supermarkets -- Traditional Grocery Retailers --- Food/drink/tobacco specialists --- Independent Small Grocers -- Other Grocery Retailers - Non-Grocery Specialists Non-Store Retailing - Vending - Homeshopping - Internet Retailing - Direct Selling Total Source:

2009

2010

2011

2012

2013

2014

92.6 91.6 78.0

91.2 90.2 77.8

89.9 88.8 76.7

88.5 87.3 75.4

88.2 87.0 74.9

88.2 87.0 75.0

4.0 1.9 43.6 28.5 13.6

3.5 1.8 43.8 28.7 12.4

3.0 1.2 43.8 28.7 12.1

2.0 0.5 44.0 28.9 11.9

1.5 0.5 44.0 28.9 12.1

1.5 0.5 44.1 28.9 12.0

-

-

-

-

-

-

13.6

12.4

12.1

11.9

12.1

12.0

-

-

-

-

-

-

1.0 7.4 0.2 7.2 100.0

1.0 8.8 0.3 8.5 100.0

1.1 10.1 0.3 9.8 100.0

1.2 11.5 0.3 11.2 100.0

1.2 11.8 0.3 11.5 100.0

1.2 11.8 0.3 11.5 100.0

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Table 65

Forecast Sales of Fortified/Functional Packaged Food by Category: Value 2014-2019

MYR million

------ FF Sugar-free Confectionery ------ FF Sugarised Sugar Confectionery ---- FF Baby Food ----- FF Milk Formula ----- FF Prepared Baby Food ---- FF Bakery Products ----- FF Biscuits ----- FF Breakfast Cereals ----- FF Bread

© Euromonitor International

2014

2015

2016

2017

2018

2019

50.8

51.2

51.8

52.5

53.3

54.2

109.7

109.4

108.9

108.4

107.8

107.0

1,539.0 1,539.0 -

1,605.3 1,605.3 -

1,679.8 1,679.8 -

1,759.2 1,759.2 -

1,840.9 1,840.9 -

1,927.4 1,927.4 -

488.5 103.0 137.3

495.6 105.0 139.3

501.6 106.9 140.9

507.4 108.5 142.8

512.4 109.8 144.8

516.9 110.9 146.9

248.3

251.3

253.8

256.1

257.9

259.1

62

HEALTH AND W ELLNESS IN MALAYSIA

---- FF Confectionery ----- FF Chocolate Confectionery ----- FF Chewing Gum ------ FF Sugar-free Chewing Gum ------ FF Sugarised Chewing Gum ----- FF Sugar Confectionery ---- FF Dairy ----- FF Cheese ----- FF Dairy-based Chilled and Shelf Stable Desserts ----- FF Flavoured Milk Drinks ----- FF Fromage Frais and Quark ----- FF Milk ------ FF Reduced Fat Milk ------ FF Standard Milk ----- FF Powder Milk ----- FF Dairy-based Yoghurt ------ FF Drinking Yoghurt ------ FF Spoonable Yoghurt ------ Total Pro/Pre Biotic Yoghurt ---- FF Meal Replacement ----- Convalescence ----- Meal Replacement Slimming ---- FF Noodles ---- FF Oils and Fats ----- FF Spreadable Oils and Fats ------ Fortified Spreadable Oils and Fats ------ Functional Spreadable Oils and Fats ----- FF Vegetable and Seed Oil ---- FF Pasta ---- FF Soup ---- FF Snack Bars ----- FF Breakfast Bars ----- FF Energy and Nutrition Bars ------ Protein Bars ------ Other Energy/ Nutrition Bars --- Fortified/ Functional Packaged Food Source:

Passport

201.7 9.0

202.3 9.1

202.7 9.1

203.2 9.2

203.6 9.2

204.0 9.2

32.1 32.1

32.5 32.5

32.9 32.9

33.2 33.2

33.4 33.4

33.7 33.7

-

-

-

-

-

-

160.5

160.6

160.8

160.9

161.0

161.2

1,357.1 71.5 -

1,415.1 73.5 -

1,475.5 75.5 -

1,539.3 77.3 -

1,606.3 79.0 -

1,676.3 80.5 -

357.8

375.7

393.7

411.5

428.7

445.9

-

-

-

-

-

-

152.5 90.7

161.0 95.8

169.2 100.6

177.3 105.5

185.4 110.3

193.4 115.2

61.9 219.2 556.0

65.3 224.9 579.9

68.5 231.2 605.9

71.8 238.1 635.2

75.0 245.8 667.5

78.2 254.4 702.1

504.2

524.4

546.2

570.8

597.9

626.7

51.7

55.5

59.7

64.4

69.6

75.5

500.5

522.4

546.4

573.7

604.2

637.0

875.5 36.2 839.3

1,030.6 36.9 993.8

1,191.1 37.4 1,153.7

1,348.8 38.1 1,310.7

1,515.7 38.9 1,476.8

1,686.6 39.7 1,646.9

415.4 -

420.3 -

426.2 -

433.5 -

441.7 -

451.4 -

-

-

-

-

-

-

-

-

-

-

-

-

415.4

420.3

426.2

433.5

441.7

451.4

1.1 0.7 0.4

1.1 0.7 0.4

1.1 0.7 0.4

1.1 0.7 0.4

1.1 0.7 0.4

1.1 0.7 0.4

0.4 -

0.4 -

0.4 -

0.4 -

0.4 -

0.4 -

4,878.2

5,170.2

5,478.0

5,792.4

6,121.8

6,463.8

Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources

© Euromonitor International

63

HEALTH AND W ELLNESS IN MALAYSIA

Table 66

Passport

Forecast Sales of Fortified/Functional Packaged Food by Category: % Value Growth 2014-2019

% constant value growth

------ FF Sugar-free Confectionery ------ FF Sugarised Sugar Confectionery ---- FF Baby Food ----- FF Milk Formula ----- FF Prepared Baby Food ---- FF Bakery Products ----- FF Biscuits ----- FF Breakfast Cereals ----- FF Bread ---- FF Confectionery ----- FF Chocolate Confectionery ----- FF Chewing Gum ------ FF Sugar-free Chewing Gum ------ FF Sugarised Chewing Gum ----- FF Sugar Confectionery ---- FF Dairy ----- FF Cheese ----- FF Dairy-based Chilled and Shelf Stable Desserts ----- FF Flavoured Milk Drinks ----- FF Fromage Frais and Quark ----- FF Milk ------ FF Reduced Fat Milk ------ FF Standard Milk ----- FF Powder Milk ----- FF Dairy-based Yoghurt ------ FF Drinking Yoghurt ------ FF Spoonable Yoghurt ------ Total Pro/Pre Biotic Yoghurt ---- FF Meal Replacement ----- Convalescence ----- Meal Replacement Slimming ---- FF Noodles ---- FF Oils and Fats ----- FF Spreadable Oils and Fats ------ Fortified Spreadable Oils and Fats ------ Functional Spreadable Oils and Fats ----- FF Vegetable and Seed Oil ---- FF Pasta ---- FF Soup ---- FF Snack Bars ----- FF Breakfast Bars ----- FF Energy and Nutrition Bars ------ Protein Bars ------ Other Energy/Nutrition Bars --- Fortified/Functional Packaged Food Source:

2014/2015

2014-19 CAGR

2014/19 TOTAL

1.7 -0.7 4.7 4.7 0.9 1.0 1.5 0.5 0.2 0.2 0.7 0.7 0.1 4.4 2.0 -

1.3 -0.5 4.6 4.6 1.1 1.5 1.4 0.9 0.2 0.4 0.9 0.9 0.1 4.3 2.4 -

6.7 -2.5 25.2 25.2 5.8 7.7 7.0 4.4 1.2 2.0 4.7 4.7 0.4 23.5 12.6 -

4.0 4.3 4.4 4.2 3.5 5.2 4.8 8.4 5.4 11.3 2.1 11.5 2.2 -

4.5 4.9 4.9 4.8 3.0 4.8 4.4 7.8 4.9 14.0 1.9 14.4 1.7 -

24.6 26.8 27.0 26.4 16.0 26.3 24.3 45.8 27.3 92.7 9.9 96.2 8.7 -

-

-

-

2.2 0.1 0.2 -0.2 -0.2 5.6

1.7 0.1 0.4 -0.4 -0.4 5.8

8.7 0.6 2.0 -2.0 -2.0 32.5

Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources

© Euromonitor International

64

HEALTH AND W ELLNESS IN MALAYSIA

© Euromonitor International

Passport

65

HEALTH AND W ELLNESS IN MALAYSIA

NATURALLY HEALTHY BEVERAGES IN MALAYSIA - CATEGORY ANALYSIS HEADLINES  Naturally healthy beverages records current off-trade value growth of 6% in 2014, with sales reaching MYR786 million  Rising consumer sophistication with regard to beverage ingredients continues to fuel demand for naturally healthy beverages  Naturally healthy RTD green tea leads growth in 2014, with current off-trade value sales rising by 10%  Off-trade current unit prices within naturally healthy hot drinks increase by 2% in 2014 while naturally healthy soft drinks prices grow by 1%  Yeo Hiap Seng leads sales in 2014, recording a retail value share of 22%  Naturally healthy beverages has a projected forecast period constant 2014 price value CAGR of 3%, with sales set to reach MYR924 million by 2019

TRENDS  Consumers are becoming increasingly aware of the ingredients contained within beverages, especially naturally healthy brands, with companies paying increasing attention to packaging, labelling and the display of naturally healthy logos.  Naturally healthy beverages current value growth in 2014 was higher than the review period CAGR of 6%. Growing demand for naturally healthy beverages is being fuelled by rising consumer health awareness and a consequent shift away from products containing artificial ingredients like added preservatives and colouring.  Naturally healthy RTD green tea saw highest off-trade value growth in 2014. Green tea has been catching up other products due to its natural state which consumers see it as a healthier option rather than other sugary beverages.  Naturally healthy superfruit juice recorded strong growth in Malaysia in 2014 as many manufacturers started to introduce more of these products since the market has the potential for further growth. For instance, many manufacturers have introduced products containing mangosteen, pomegranate, aloe vera and coconut juice. However, manufacturers are not aggressively promoting these products and are instead relying on social media, free samples and road shows to attract consumers. While some direct sellers offer these products, they remain unpopular in Malaysia.  Naturally healthy RTD tea is seeing intense competition due to the fact there are many products and brands available in the area. However, there is lack of stevia-sweetened products or brands with functional variants. Naturally healthy RTD green tea continues to drive growth, with sales in the area rising by 10% in 2014. There are many brands available in the area such as Green Home 100% Green Tea, Chai Li Won Taiwanese Green Tea, Heaven & Earth Ice Green Tea, Heaven & Earth Jasmine Green Tea, Lipton Green Tea 9, Dorinku Honey Green Tea and Oishi Green Tea. Naturally healthy RTD tea continued to be dominated by international players in 2014.

© Euromonitor International

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66

HEALTH AND W ELLNESS IN MALAYSIA

 Off-trade unit prices within naturally healthy hot drinks grew by 2% in 2014 while naturally healthy soft drinks prices grew by 1%. Naturally healthy beverages are becoming more expensive due to the fact raw materials for these products are derived from natural resources that need strong investment in research and development to produce.

COMPETITIVE LANDSCAPE  Yeo Hiap Seng led sales in 2014, recording an off-trade value share of 22% and sales of MYR170 million. The company organised several marketing activities like brand building, promotions and consumer loyalty programmes such as Dynamic Dance Competition, Mooncake Festival Celebration and Yeo’s Funderful Video Making Contest to enhance brand image. In addition, the company also adopted aseptic cold fill PET technology for its new product line to ensure better quality taste, enhanced nutrition value and freshness.  Pokka Ace recorded the biggest increase in value sales in 2014 (to MYR18 million) due to strong distribution and the fact that the company’s products occupy a large amount of shelf space.  In March 2014, Permanis introduced Tropicana Coconut Water, a naturally healthy superfruit juice. Coconut water is widely accepted by all consumers. However, the company is currently only using social media to spread awareness of its new products.  Premium, standard and economy brands usually compete in terms of unit selling price, with consumers usually determining quality based on unit selling price. Sales of private label products remain insignificant in terms of naturally healthy beverage offerings in Malaysia.  Successful manufacturer strategies in naturally healthy beverages include aggressive promotions like price discounts, road shows, free samples and media advertising. These marketing strategies are also popular due to the fact they are not too expensive.  Good Hope International Beverages continued to stay small among naturally health beverages value sales. While the company offers Dewlands juice, the brand suffers from limited distribution and a lack of brand awareness. Most consumers remain unaware of this product since it can only be found in selected retail outlets such as Presto Supermarket.

PROSPECTS  Growing demand from consumers will drive sales of naturally healthy beverages over the forecast period. Strong social media support via sites like Facebook and twitter will help to increase consumer awareness of brands and ingredients which are naturally healthy.  Naturally healthy RTD green tea will lead growth over the forecast period, with the area having a projected constant 2014 price value CAGR of 7%. RTD green tea is considered to be naturally healthy and the variety of brands available in this area is expected to continue to increase.  New product launches like Tropicana Coconut Water from Permanis are expected to perform well in the short term due to the lack of brands available, especially regarding coconut water. As a result, this area has growth potential and will attract other manufacturers over the coming years.  Potential company activities over the forecast period include media advertisements, road shows, special events and aggressive promotions to attract consumer attention. In addition, naturally healthy beverages are highly popular in modern retail outlets such as hypermarkets,

© Euromonitor International

Passport

67

HEALTH AND W ELLNESS IN MALAYSIA

Passport

supermarkets and convenience stores. This is because most consumers visiting these channels are from medium to high income groups and can thus afford such products.  Potential threats to forecast period growth include rising inflation, consumer spending patterns and government policy reform. Although consumers understand that better for you beverages are good for health, increasingly high commodity prices are resulting in consumers spending less on healthy products that are not as essential as commodity products. In addition, the government is set to implement a goods and service tax in 2015 which may result in consumers spending more carefully over the forecast period.

CATEGORY DATA Table 67

Sales of NH Beverages by Category: Value 2009-2014

MYR million

---- NH Hot Drinks ----- NH Tea ------ NH Fruit/Herbal Tea ------ NH Green Tea ------ NH Other Tea ----- NH Other Hot Drinks ---- NH Soft Drinks ----- NH Asian Speciality Drinks ----- NH Bottled Water ------ NH Flavoured Bottled Water ------ NH Natural Mineral Water ------- NH Carbonated Natural Mineral Bottled Water ------- NH Still Natural Mineral Bottled Water ------ NH Spring Water ------- NH Carbonated Spring Bottled Water ------- NH Still Spring Bottled Water ----- NH Fruit/ Vegetable Juice ------ NH 100% Juice ------ NH Superfruit Juice ------- NH Superfruit 100% Juice ------- NH Superfruit Juice (up to 24% Juice) ------- NH Superfruit Nectars (25-99% Juice) ----- NH Non-Cola Carbonates ----- NH RTD Tea

© Euromonitor International

2009

2010

2011

2012

2013

2014

73.2 69.2 29.0

76.9 72.9 31.1

80.7 76.9 33.6

83.4 79.6 35.4

86.5 82.7 37.4

89.9 86.0 39.4

14.6 25.6 4.0 510.7 98.8

15.3 26.5 4.0 551.0 101.2

16.0 27.3 3.9 583.2 105.2

16.4 27.8 3.8 617.6 109.1

16.8 28.5 3.8 655.0 113.1

17.4 29.3 3.8 695.6 117.2

206.5 -

228.0 -

239.3 -

253.5 -

269.2 -

286.8 -

206.5

228.0

239.3

253.5

269.2

286.8

6.7

6.9

7.1

7.3

7.6

7.9

199.8

221.1

232.2

246.1

261.6

278.9

-

-

-

-

-

-

-

-

-

-

-

-

60.6

65.8

70.2

74.6

79.1

83.8

22.6 38.0

24.2 41.5

26.0 44.1

27.6 47.0

29.1 50.0

30.7 53.0

7.5

8.5

9.0

9.6

10.2

10.9

25.2

27.2

29.1

31.2

33.2

35.4

5.4

5.8

6.0

6.3

6.5

6.8

-

-

-

-

-

-

144.8

156.0

168.5

180.4

193.5

207.9

68

HEALTH AND W ELLNESS IN MALAYSIA

------ NH RTD Green Tea ------ Other NH RTD Tea --- Naturally Healthy Beverages Source:

Passport

25.5 119.4 583.9

30.1 126.0 627.9

34.1 134.4 663.9

37.2 143.3 701.0

40.6 152.9 741.5

44.5 163.4 785.5

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Table 68

Sales of NH Beverages by Category: % Value Growth 2009-2014

% current value growth

---- NH Hot Drinks ----- NH Tea ------ NH Fruit/Herbal Tea ------ NH Green Tea ------ NH Other Tea ----- NH Other Hot Drinks ---- NH Soft Drinks ----- NH Asian Speciality Drinks ----- NH Bottled Water ------ NH Flavoured Bottled Water ------ NH Natural Mineral Water ------- NH Carbonated Natural Mineral Bottled Water ------- NH Still Natural Mineral Bottled Water ------ NH Spring Water ------- NH Carbonated Spring Bottled Water ------- NH Still Spring Bottled Water ----- NH Fruit/Vegetable Juice ------ NH 100% Juice ------ NH Superfruit Juice ------- NH Superfruit 100% Juice ------- NH Superfruit Juice (up to 24% Juice) ------- NH Superfruit Nectars (25-99% Juice) ----- NH Non-Cola Carbonates ----- NH RTD Tea ------ NH RTD Green Tea ------ Other NH RTD Tea --- Naturally Healthy Beverages Source:

2013/14

2009-14 CAGR

2009/14 Total

3.8 4.0 5.3 3.2 2.7 0.9 6.2 3.5 6.5 6.5 3.9

4.2 4.5 6.3 3.6 2.7 -0.9 6.4 3.5 6.8 6.8 3.4

22.8 24.4 35.7 19.4 14.4 -4.4 36.2 18.6 38.9 38.9 18.5

6.6

6.9

39.6

-

-

-

5.9 5.5 6.2 6.1 6.6

6.7 6.4 6.9 7.8 7.0

38.3 36.2 39.6 45.6 40.4

4.2

4.9

27.2

7.4 9.5 6.9 5.9

7.5 11.8 6.5 6.1

43.5 74.6 36.9 34.5

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Table 69

NBO Company Shares of NH Beverages: % Value 2010-2014

% retail value rsp Company Yeo Hiap Seng (M) Bhd Spritzer Bhd Fraser & Neave Holdings Bhd Ace Canning Corp Sdn Bhd

© Euromonitor International

2010

2011

2012

2013

2014

20.7 18.1 11.6

20.7 18.6 10.5

21.0 19.3 10.0

21.3 19.7 9.9

21.6 20.1 9.8

6.1

6.1

6.2

6.2

6.1

69

HEALTH AND W ELLNESS IN MALAYSIA

Permanis Sdn Bhd MP Mineral Water Mfg Sdn Bhd Pokka Ace (M) Sdn Bhd Malaysia Milk Sdn Bhd Danone, Groupe Coca-Cola Bottlers (M) Sdn Bhd Eau Claire Mineral Water Sdn Bhd Herbalife Products (M) Sdn Bhd National Foods Pty Ltd 21st Century Products Sdn Bhd Nestlé (Malaysia) Bhd Ten Ren Trading Sdn Bhd Total Image Regional (M) Sdn Bhd Super Food Technology Sdn Bhd Cosway (M) Sdn Bhd Boh Plantations Sdn Bhd Unilever (M) Holdings Sdn Bhd Gold Roast (M) Sdn Bhd Odani Kokufun Co Ltd MDD Beverage Sdn Bhd Ceres Fruit Juices (Pty) Ltd Twining & Co Ltd, R Ahmad Tea London Ltd In-Comix Food Industries Sdn Bhd Liqui-Fruit (Pty) Ltd Gold Choice Food Industries Sdn Bhd Others Total Source:

Passport

3.3 2.5

3.3 2.4

3.4 2.4

3.3 2.4

3.3 2.3

1.9 1.9 1.8 -

2.0 2.0 1.7 1.8

2.1 2.0 1.7 1.8

2.2 2.0 1.7 1.7

2.2 2.0 1.7 1.6

1.7

1.6

1.6

1.6

1.5

1.3

1.3

1.4

1.4

1.5

1.4 1.0

1.4 1.0

1.4 1.0

1.4 1.1

1.4 1.1

1.0 0.8 0.7

1.0 0.8 0.7

0.9 0.8 0.7

0.9 0.8 0.7

0.9 0.8 0.7

0.8

0.7

0.7

0.7

0.7

0.6 0.5 -

0.6 0.5 0.2

0.6 0.5 0.3

0.5 0.5 0.3

0.5 0.5 0.3

0.3 0.3 0.3 0.2

0.3 0.3 0.2 0.2

0.3 0.3 0.2 0.2

0.3 0.3 0.2 0.2

0.2 0.2 0.2 0.2

0.2 0.2 0.2

0.2 0.2 0.2

0.2 0.2 0.1

0.2 0.2 0.1

0.2 0.2 0.1

0.1 0.1

0.1 0.1

0.1 0.1

0.1 0.1

0.1 0.1

20.6 100.0

19.0 100.0

18.6 100.0

18.1 100.0

17.7 100.0

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Table 70

LBN Brand Shares of NH Beverages: % Value 2011-2014

% retail value rsp Brand Spritzer Natural Mineral Water Yeo's Drinho Cactus Bleu Alpine Mineral Water Fruit Tree Pokka Seasons

© Euromonitor International

Company

2011

2012

2013

2014

Spritzer Bhd

14.7

15.3

15.7

16.1

Yeo Hiap Seng (M) Bhd Ace Canning Corp Sdn Bhd Spritzer Bhd Permanis Sdn Bhd MP Mineral Water Mfg Sdn Bhd Fraser & Neave Holdings Bhd Pokka Ace (M) Sdn Bhd Fraser & Neave Holdings

14.0 6.1 3.8 3.3 2.4

14.2 6.1 4.0 3.4 2.4

14.4 6.1 4.0 3.3 2.4

14.4 6.1 4.0 3.3 2.3

2.3

2.3

2.3

2.3

2.0 2.1

2.1 2.1

2.2 2.1

2.2 2.2

70

HEALTH AND W ELLNESS IN MALAYSIA

Marigold Borneo Mineral Water Evian Natural Spring Water Dasani Eau Claire Mineral Water Herbalife F&N Ice Mountain Berri 21st Century Fruit Tree Fresh Perrier Ten Ren Total Image Super Boh Sunkist Lipton Just Juice Oriyen Gold Roast OSK Sencha Green Tea Others Total Source:

Passport

Bhd Malaysia Milk Sdn Bhd Fraser & Neave Holdings Bhd Danone, Groupe Coca-Cola Bottlers (M) Sdn Bhd Eau Claire Mineral Water Sdn Bhd Herbalife Products (M) Sdn Bhd Fraser & Neave Holdings Bhd National Foods Pty Ltd 21st Century Products Sdn Bhd Fraser & Neave Holdings Bhd Nestlé (Malaysia) Bhd Ten Ren Trading Sdn Bhd Total Image Regional (M) Sdn Bhd Super Food Technology Sdn Bhd Boh Plantations Sdn Bhd Fraser & Neave Holdings Bhd Unilever (M) Holdings Sdn Bhd National Foods Pty Ltd Cosway (M) Sdn Bhd Gold Roast (M) Sdn Bhd Odani Kokufun Co Ltd

2.0 2.4

2.0 1.9

2.0 1.9

2.0 1.8

1.7

1.7

1.7

1.7

1.8

1.8

1.7

1.6

1.6

1.6

1.6

1.5

1.3

1.4

1.4

1.5

1.6

1.5

1.5

1.5

1.1 1.0

1.1 1.0

1.1 1.1

1.1 1.1

1.0

1.0

1.0

1.0

1.0 0.8 0.7

0.9 0.8 0.7

0.9 0.8 0.7

0.9 0.8 0.7

0.7

0.7

0.7

0.7

0.5 0.6

0.5 0.5

0.5 0.5

0.5 0.5

0.2

0.3

0.3

0.3

0.3 0.3 0.3 0.3 27.8 100.0

0.3 0.3 0.3 0.3 27.5 100.0

0.3 0.3 0.3 0.3 27.1 100.0

0.3 0.3 0.2 0.2 26.9 100.0

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Table 71

Distribution of NH Beverages by Format: % Value 2009-2014

% retail value rsp

Store-Based Retailing - Grocery Retailers -- Modern Grocery Retailers --- Convenience Stores --- Discounters --- Forecourt Retailers --- Hypermarkets --- Supermarkets -- Traditional Grocery Retailers --- Food/drink/tobacco specialists --- Independent Small Grocers

© Euromonitor International

2009

2010

2011

2012

2013

2014

97.4 97.4 68.8

97.4 97.4 69.1

97.5 97.5 69.3

97.5 97.5 69.5

97.5 97.5 70.0

97.5 97.5 70.2

8.5 1.2 49.5 9.6 24.4

8.5 1.2 49.6 9.8 24.6

8.3 1.2 49.8 10.0 24.6

8.1 1.3 49.9 10.2 24.6

8.2 1.4 50.0 10.4 24.6

8.2 1.4 50.0 10.6 24.4

-

-

-

-

-

-

24.4

24.6

24.6

24.6

24.6

24.4

71

HEALTH AND W ELLNESS IN MALAYSIA

-- Other Grocery Retailers - Non-Grocery Specialists Non-Store Retailing - Vending - Homeshopping - Internet Retailing - Direct Selling Total Source:

Passport

4.2

3.7

3.6

3.4

2.9

2.9

2.6 2.5 0.1 100.0

2.6 2.5 0.1 100.0

2.5 2.4 0.1 100.0

2.5 2.3 0.2 100.0

2.5 2.2 0.3 100.0

2.5 2.2 0.3 100.0

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Table 72

Forecast Sales of NH Beverages by Category: Value 2014-2019

MYR million

---- NH Hot Drinks ----- NH Tea ------ NH Fruit/Herbal Tea ------ NH Green Tea ------ NH Other Tea ----- NH Other Hot Drinks ---- NH Soft Drinks ----- NH Asian Speciality Drinks ----- NH Bottled Water ------ NH Flavoured Bottled Water ------ NH Natural Mineral Water ------- NH Carbonated Natural Mineral Bottled Water ------- NH Still Natural Mineral Bottled Water ------ NH Spring Water ------- NH Carbonated Spring Bottled Water ------- NH Still Spring Bottled Water ----- NH Fruit/ Vegetable Juice ------ NH 100% Juice ------ NH Superfruit Juice ------- NH Superfruit 100% Juice ------- NH Superfruit Juice (up to 24% Juice) ------- NH Superfruit Nectars (25-99% Juice) ----- NH Non-Cola Carbonates ----- NH RTD Tea ------ NH RTD Green Tea ------ Other NH RTD Tea

© Euromonitor International

2014

2015

2016

2017

2018

2019

89.9 86.0 39.4

90.8 86.9 40.2

91.8 87.8 41.0

93.0 88.9 41.8

94.2 90.2 42.6

95.6 91.6 43.3

17.4 29.3 3.8 695.6 117.2

17.4 29.3 3.9 717.9 117.2

17.5 29.3 4.0 741.3 116.5

17.7 29.5 4.0 767.7 116.7

17.9 29.7 4.0 796.5 117.3

18.3 30.0 3.9 828.6 118.4

286.8 -

297.5 -

309.2 -

321.9 -

335.5 -

350.7 -

286.8

297.5

309.2

321.9

335.5

350.7

7.9

8.0

8.1

8.2

8.3

8.5

278.9

289.5

301.1

313.7

327.2

342.3

-

-

-

-

-

-

-

-

-

-

-

-

83.8

85.7

87.6

89.6

91.7

93.6

30.7 53.0

31.3 54.5

31.8 55.9

32.4 57.2

33.2 58.5

34.0 59.6

10.9

11.2

11.5

11.8

12.0

12.3

35.4

36.4

37.5

38.4

39.3

40.2

6.8

6.9

7.0

7.0

7.1

7.1

-

-

-

-

-

-

207.9 44.5 163.4

217.5 47.5 169.9

227.9 50.9 177.1

239.4 54.6 184.9

252.0 58.7 193.4

265.8 63.2 202.7

72

HEALTH AND W ELLNESS IN MALAYSIA

--- Naturally Healthy Beverages Source:

Table 73

Passport

785.5

808.7

833.1

860.6

890.8

924.2

Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources

Forecast Sales of NH Beverages by Category: % Value Growth 2014-2019

% constant value growth

---- NH Hot Drinks ----- NH Tea ------ NH Fruit/Herbal Tea ------ NH Green Tea ------ NH Other Tea ----- NH Other Hot Drinks ---- NH Soft Drinks ----- NH Asian Speciality Drinks ----- NH Bottled Water ------ NH Flavoured Bottled Water ------ NH Natural Mineral Water ------- NH Carbonated Natural Mineral Bottled Water ------- NH Still Natural Mineral Bottled Water ------ NH Spring Water ------- NH Carbonated Spring Bottled Water ------- NH Still Spring Bottled Water ----- NH Fruit/Vegetable Juice ------ NH 100% Juice ------ NH Superfruit Juice ------- NH Superfruit 100% Juice ------- NH Superfruit Juice (up to 24% Juice) ------- NH Superfruit Nectars (25-99% Juice) ----- NH Non-Cola Carbonates ----- NH RTD Tea ------ NH RTD Green Tea ------ Other NH RTD Tea --- Naturally Healthy Beverages Source:

2014/2015

2014-19 CAGR

2014/19 TOTAL

1.4 1.6 1.7 2.1 1.0 -2.5 4.0 0.9 4.5 4.5 1.7

1.2 1.3 1.9 1.1 0.5 0.3 3.6 0.2 4.1 4.1 1.4

6.3 6.6 10.1 5.4 2.5 1.7 19.1 1.1 22.3 22.3 7.1

4.6

4.2

22.7

-

-

-

2.1 2.5 2.0 2.1 2.2

2.2 2.0 2.4 2.5 2.6

11.8 10.7 12.4 13.2 13.7

0.5

0.8

4.3

5.5 7.7 4.8 3.7

5.0 7.3 4.4 3.3

27.9 42.0 24.0 17.7

Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources

© Euromonitor International

73

HEALTH AND W ELLNESS IN MALAYSIA

NATURALLY HEALTHY PACKAGED FOOD IN MALAYSIA - CATEGORY ANALYSIS HEADLINES  Naturally healthy packaged food sees 3% current value growth to reach RM1 billion in 2014  Wide range of naturally healthy packaged food offerings drives steady growth  Naturally healthy olive oil most dynamic with 5% current value terms increase in 2014  Unit price increases for most categories in naturally healthy packaged food in 2014  SOS Corp Alimentaria SA leads naturally healthy olive oil in 2014 with 32% value share  Marginal constant value CAGR predicted for naturally healthy packaged food over forecast period

TRENDS  There are many product ranges in packaged food that are naturally healthy such as biscuits, spreadable oils and fats, honey and breakfast bars. Consumers tend to purchase these products due to health awareness. Furthermore, many biscuit brands are offering high fibre products, including brands such as McVitie’s, Jacob’s Hi-Fibre, Jacob’s Weetameal, Julie’s Wheat Crackers and Munchy’s.  Growth was slowing in 2014 compared with the review period. This was due to saturation with existing players which might have a lack of product innovation and price promotion. Furthermore, consumers tend to look for cheaper brands due to the increasing prices of commodity products, which drove consumers to spend less on premium brands.  Naturally healthy olive oil saw the fastest growth of 5% in current value terms in 2014 due to consumers is increasing health consciousness. Olive oil is widely perceived as healthy and consumers usually purchase it to mix with salad and for cooking.  Non-dairy milk excluding soy, such as rice milk, oat milk and hemp milk are found selling in Malaysia with 4% value growth in 2014. In addition, brands such as Yeo’s, Drinho, Seasons Nutrisoy, Marigold and Soyfresh are found offering non-dairy milk alternatives. Naturally healthy soy milk grew by 5% in current value terms in 2014, and there were many popular brands sold in major retail outlets. Non-dairy milk was growing slower than total retail sales of milk in retail outlets. However, it continued to grow positively due to consumers being increasingly demanding with regard to the substitution of milk drinks. Non-dairy milk excluding soy benefits from the offer and several variants for consumers to choose from, such as walnut milk, almond milk and hemp milk.  Naturally healthy food such as oats and dietary fibre are perceived as beneficial for heart health. Consumers, especially the elderly, tend to purchase more of these products to maintain their heart health. Other than the elderly, adults are also buying more of these products for both their children and themselves due to increasing health issues, especially fatal heart disease among the younger generation. Dietary fibre also aids digestive health and weight management.

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Passport

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HEALTH AND W ELLNESS IN MALAYSIA

 The unit price increased for most naturally healthy packaged food products due to increasing raw materials’ costs in 2014. Consumers tend choose cheaper brands, especially those in low- to middle-income segments, as naturally healthy packaged food is perceived as expensive.

COMPETITIVE LANDSCAPE  SOS Corp Alimentaria SA led sales with a 32% value shares and sales worth RM3 million recorded in naturally healthy olive oil in 2014. The company offers Bertolli, which is a popular, premium and quality olive oil sold through most modern retail channels such as hypermarkets and supermarkets.  SOS Corp Alimentaria SA saw the largest increase with 6% value growth in 2014. The company offers a premium price and quality assurance for its olive oil. Furthermore, its strong distribution network also drove its sales growth in 2014, available in major high-end hypermarkets such as Aeon Big, Cold Storage, Giant, Sam Groceria and Tesco.  Manufacturers tend to sell naturally healthy food products through high-end hypermarkets such as Aeon Big, Cold Storage, Sam Groceria, Giant and Tesco. This is because the consumers who shop in these channels are mainly upper-income citizens, and able to spend more on healthy food. Furthermore, consumers are not value conscious when choosing naturally healthy packaged food in these high end retail outlets, and are rather quality conscious. As a result, other players might also offer the same premium price and quality naturally healthy packaged food products as these outlets. For instance, Lam Soon (M) Bhd also offers premium Naturel Organic Extra Virgin Olive Oil in most retail outlets such as Aeon Big and Tesco.  The players in non-dairy milk excluding soy are such as Yeo Hiap Seng (M) Bhd, Ace Canning Corp Sdn Bhd, Fraser & Neave Holdings Bhd and Malaysia Milk Sdn Bhd. These international players complete intensively to gain share. These players often organise price discounts and media advertising to create brand awareness. There was insignificant new functional innovation from these players in 2014.  Manufacturers have invested advanced technology in terms of keep the naturally healthy products fresh and can be stored for a certain period. Therefore, unit prices tend to be higher than regular packaged food. There is an insignificant offer of naturally healthy products in the standard or economy price segments, as well as a lack of private label offerings in Malaysia.

PROSPECTS  Consumer health awareness will continue to drive naturally healthy products to grow further over the forecast period. Consumers tend to choose naturally healthy packaged food as it is perceived as containing no added preservatives or colourants, and is safe for consumption.  A marginal constant value CAGR is estimated for naturally healthy packaged food over the forecast period. Naturally healthy packaged food is expected to grow positively due to increasing demand from consumers. Furthermore, consumers can purchase conveniently through any hypermarkets and supermarkets as well as via internet retailing sites, such as Sam Groceria and Presto. The factor potentially constraining future sales growth of naturally healthy packaged food is increasingly high natural raw materials costs, which could drive up retail unit prices and cause consumers to choose other healthy products.

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HEALTH AND W ELLNESS IN MALAYSIA

Passport

 Non-dairy milk is expected to grow further in coming years as an alternative to milk drinks, which consumers can choose instead of dairy milk. In addition, some consumers may not prefer dairy milk for health and fat content reasons.  The other factors influencing overall category growth over the forecast period include the increasing number of variants on offer in other categories such as organics and fortified/functional. This is because consumers are widely accepting organic and fortified/functional products rather than naturally healthy packaged food. Furthermore, unit price will be affected, especially as the government is implementing a goods and service tax in 2015. This may drive consumers to seek cheaper brands, as health and wellness packaged food is perceived as premium in terms of price compared with regular packaged food.

CATEGORY DATA Table 74

Sales of NH Packaged Food by Category: Value 2009-2014

MYR million

---- NH High Fibre Food ----- NH High Fibre Bakery Products ------ NH High Fibre Biscuits ------ NH High Fibre Bread ------ NH High Fibre Breakfast Cereals ----- NH High Fibre Noodles ----- NH High Fibre Pasta ----- NH Rice ---- NH Honey ---- NH Oils and Fats ----- NH Olive Oil ----- NH Regular Spreadable Oils and Fats ---- NH Snack Bars ----- NH Fruit Bars ----- NH Granola/Muesli Bars ---- NH Sour Milk Products ---- NH Soy Products ----- NH Non-Dairy Milk Alternatives ------ NH Soy Drinks ------ NH Soy Milk ------ NH Other NonDairy Milk Alternatives ----- NH Soy-based Dairy Alternatives ------ NH Soy-based Chilled and Shelf Stable Desserts ------ NH Soy-based Yoghurt

© Euromonitor International

2009

2010

2011

2012

2013

2014

227.4 227.4

234.3 234.3

244.5 244.5

257.7 257.7

271.1 271.1

277.7 277.7

57.7

60.1

61.8

64.6

67.6

70.5

106.4

109.6

116.7

125.2

133.9

135.9

63.3

64.6

66.0

67.9

69.7

71.3

-

-

-

-

-

-

8.9 13.9 6.4 7.6

9.4 14.0 6.6 7.5

9.9 14.8 6.9 7.8

10.3 15.5 7.4 8.1

10.7 16.1 7.7 8.4

11.1 16.7 8.1 8.6

6.2 6.2

6.5 6.5

6.7 6.7

6.9 6.9

7.2 7.2

7.4 7.4

-

-

-

-

-

-

315.1 315.1

326.1 326.1

352.1 352.1

378.3 378.3

397.1 397.1

415.7 415.7

315.1 -

326.1 -

352.1 -

378.3 -

397.1 -

415.7 -

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

76

HEALTH AND W ELLNESS IN MALAYSIA

----- NH Soy-based Meat Alternatives ------ NH Soy-based Frozen Meat Substitutes ------ NH Soy-based Ready Meals ---- Other NH Frozen Meat Substitutes ---- Other NH Ready Meals ---- NH Sweet and Savoury Snacks ----- NH Fruit Snacks ----- NH Nuts --- Naturally Healthy Packaged Food Source:

Table 75

Passport

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

271.9

277.1

280.8

286.6

291.4

295.3

44.1 227.8 843.5

45.9 231.2 867.4

47.2 233.5 908.7

48.4 238.2 955.3

49.6 241.8 993.6

51.1 244.2 1,023.9

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Sales of NH Packaged Food by Category: % Value Growth 2009-2014

% current value growth

---- NH High Fibre Food ----- NH High Fibre Bakery Products ------ NH High Fibre Biscuits ------ NH High Fibre Bread ------ NH High Fibre Breakfast Cereals ----- NH High Fibre Noodles ----- NH High Fibre Pasta ----- NH Rice ---- NH Honey ---- NH Oils and Fats ----- NH Olive Oil ----- NH Regular Spreadable Oils and Fats ---- NH Snack Bars ----- NH Fruit Bars ----- NH Granola/Muesli Bars ---- NH Sour Milk Products ---- NH Soy Products ----- NH Non-Dairy Milk Alternatives ------ NH Soy Drinks ------ NH Soy Milk ------ NH Other Non-Dairy Milk Alternatives ----- NH Soy-based Dairy Alternatives ------ NH Soy-based Chilled and Shelf Stable Desserts ------ NH Soy-based Yoghurt ----- NH Soy-based Meat Alternatives ------ NH Soy-based Frozen Meat Substitutes ------ NH Soy-based Ready Meals ---- Other NH Frozen Meat Substitutes ---- Other NH Ready Meals ---- NH Sweet and Savoury Snacks ----- NH Fruit Snacks ----- NH Nuts

© Euromonitor International

2013/14

2009-14 CAGR

2009/14 Total

2.4 2.4 4.3 1.5 2.4 3.7 4.0 4.9 3.2

4.1 4.1 4.1 5.0 2.4 4.6 3.8 5.0 2.7

22.1 22.1 22.1 27.7 12.7 25.0 20.2 27.4 14.2

2.8 2.8 4.7 4.7 4.7 -

3.4 3.4 5.7 5.7 5.7 -

18.4 18.4 31.9 31.9 31.9 -

-

-

-

-

-

-

1.3 3.0 1.0

1.7 3.0 1.4

8.6 15.9 7.2

77

HEALTH AND W ELLNESS IN MALAYSIA

Passport

--- Naturally Healthy Packaged Food Source:

3.0

4.0

21.4

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Table 76

NBO Company Shares of NH Packaged Food: % Value 2010-2014

% retail value rsp Company Yeo Hiap Seng (M) Bhd Ace Canning Corp Sdn Bhd Tong Garden Snack Foods Sdn Bhd Italian Baker Sdn Bhd, The Quaker Products (M) Sdn Bhd Gardenia Bakery KL Sdn Bhd Fraser & Neave Holdings Bhd Ngan Yin Groundnut Factory Sdn Bhd Thong Thye Groundnut Factory Sdn Bhd NOI Food Products Sdn Bhd Mondelez (M) Sales Sdn Bhd Stanson Bakeries Sdn Bhd Malaysia Milk Sdn Bhd United Biscuits (Holdings) Plc Sunsweet Growers Inc Federal Oats Mills Sdn Bhd Sun-Maid Growers Inc Seng Hua Hng Foodstuffs Pte Ltd Kellogg Asia Marketing Inc Kee Wee Hup Kee Trading (M) Sdn Bhd Capilano Honey Ltd Dairy Crest Group Plc Tesco Stores (Malaysia) Sdn Bhd Liberty Gold Fruit Co Inc General Mills Inc Desa Southern Agency Sdn Bhd SOS Corp Alimentaria SA Perfect Food Mfg (M) Sdn Bhd Kong Heong Yuen Groundnut Factory Sdn Bhd Industria Alimentare Colavita SpA Kraft Foods (M) Sdn Bhd Generics

© Euromonitor International

2010

2011

2012

2013

2014

20.0 10.4 7.4

21.0 10.5 7.3

21.7 10.4 7.1

22.2 10.3 7.1

22.7 10.4 7.1

-

0.7

4.4

5.4

5.6

5.2

5.1

5.1

5.2

5.2

7.6

7.4

4.7

4.9

5.0

4.2

4.3

4.4

4.4

4.4

3.4

3.3

3.2

3.1

3.1

3.1

3.0

3.0

2.9

2.9

2.6 -

2.4 -

2.4 -

2.3 2.1

2.3 2.1

3.9 1.3 1.3

3.7 1.2 1.2

3.2 1.2 1.2

2.3 1.2 1.2

2.0 1.2 1.2

1.0 1.1

1.0 1.0

1.0 0.9

1.0 0.9

1.1 0.8

0.8 0.8

0.8 0.8

0.7 0.7

0.8 0.7

0.8 0.7

0.7

0.7

0.7

0.7

0.7

0.7

0.6

0.6

0.6

0.6

0.3 0.4 0.6

0.3 0.4 0.5

0.3 0.4 0.5

0.5 0.4 0.5

0.5 0.4 0.4

0.5 0.4 0.3

0.5 0.4 0.3

0.5 0.4 0.3

0.4 0.4 0.3

0.4 0.4 0.3

0.2 0.2

0.2 0.2

0.2 0.2

0.2 0.2

0.3 0.2

0.2

0.2

0.2

0.2

0.2

0.2

0.2

0.2

0.2

0.2

2.4 0.4

2.3 0.4

2.2 0.4

0.4

0.4

78

HEALTH AND W ELLNESS IN MALAYSIA

Other Private Label Others Total Source:

Passport

0.2 18.4 100.0

0.2 17.9 100.0

0.2 17.5 100.0

0.1 16.9 100.0

0.1 16.6 100.0

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Table 77

LBN Brand Shares of NH Packaged Food: % Value 2011-2014

% retail value rsp Brand Yeo's Drinho Tong Garden Massimo Quaker Gardenia Seasons Nutrisoy Ngan Yin Pagoda NOI High 5 Jacob's Marigold McVitie's Sunsweet Captain Oats Sun-Maid Camel Ego Vitalite Tesco Ligo Nature Valley Kellogg's All Bran Miaow Miaow Planters Kellogg's Raisin Bran Capilano Soyfresh Bertolli Seasons Soya Bean Jacob's Planters Generics Other Private Label Others Total

© Euromonitor International

Company

2011

2012

2013

2014

Yeo Hiap Seng (M) Bhd Ace Canning Corp Sdn Bhd Tong Garden Snack Foods Sdn Bhd Italian Baker Sdn Bhd, The Quaker Products (M) Sdn Bhd Gardenia Bakery KL Sdn Bhd Fraser & Neave Holdings Bhd Ngan Yin Groundnut Factory Sdn Bhd Thong Thye Groundnut Factory Sdn Bhd NOI Food Products Sdn Bhd Stanson Bakeries Sdn Bhd Mondelez (M) Sales Sdn Bhd Malaysia Milk Sdn Bhd United Biscuits (Holdings) Plc Sunsweet Growers Inc Federal Oats Mills Sdn Bhd Sun-Maid Growers Inc Seng Hua Hng Foodstuffs Pte Ltd Kee Wee Hup Kee Trading (M) Sdn Bhd Dairy Crest Group Plc Tesco Stores (Malaysia) Sdn Bhd Liberty Gold Fruit Co Inc General Mills Inc Kellogg Asia Marketing Inc Desa Southern Agency Sdn Bhd Mondelez (M) Sales Sdn Bhd Kellogg Asia Marketing Inc Capilano Honey Ltd Ace Canning Corp Sdn Bhd SOS Corp Alimentaria SA Fraser & Neave Holdings Bhd Kraft Foods (M) Sdn Bhd Kraft Foods (M) Sdn Bhd

21.0 10.2 7.3

21.7 10.1 7.1

22.2 10.0 7.1

22.7 10.2 7.1

0.7 5.1

4.4 5.1

5.4 5.2

5.6 5.2

7.4 -

4.7 -

4.9 -

5.0 4.4

3.3

3.2

3.1

3.1

3.0

3.0

2.9

2.9

2.4 3.7 1.2 1.2

2.4 3.2 1.2 1.2

2.3 2.3 1.7 1.2 1.2

2.3 2.0 1.7 1.2 1.2

1.0 1.0 0.8 0.8

1.0 0.9 0.7 0.7

1.0 0.9 0.8 0.7

1.1 0.8 0.8 0.7

0.6

0.6

0.6

0.6

0.4 0.5

0.4 0.5

0.4 0.5

0.4 0.4

0.5 0.4 0.4 0.3

0.5 0.4 0.4 0.3

0.4 0.4 0.4 0.3

0.4 0.4 0.4 0.3

0.3 0.3 0.3 0.2 4.2

0.3 0.3 0.3 0.2 4.4

0.4 0.3 0.3 0.3 0.2 4.4

0.3 0.3 0.3 0.3 0.3 -

1.7 0.6 0.4 0.2 18.5 100.0

1.7 0.5 0.4 0.2 18.1 100.0

0.4 0.1 17.6 100.0

0.4 0.1 17.3 100.0

79

HEALTH AND W ELLNESS IN MALAYSIA

Source:

Passport

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Table 78

Distribution of NH Packaged Food by Format: % Value 2009-2014

% retail value rsp

Store-Based Retailing - Grocery Retailers -- Modern Grocery Retailers --- Convenience Stores --- Discounters --- Forecourt Retailers --- Hypermarkets --- Supermarkets -- Traditional Grocery Retailers --- Food/drink/tobacco specialists --- Independent Small Grocers -- Other Grocery Retailers - Non-Grocery Specialists Non-Store Retailing - Vending - Homeshopping - Internet Retailing - Direct Selling Total Source:

2009

2010

2011

2012

2013

2014

100.0 100.0 94.3

100.0 100.0 94.4

100.0 100.0 94.4

100.0 100.0 94.5

100.0 100.0 94.5

100.0 100.0 94.5

3.7 55.3 35.3 5.7

3.6 55.4 35.4 5.6

3.6 55.4 35.4 5.6

3.5 55.5 35.5 5.5

3.5 55.5 35.5 5.5

3.5 55.5 35.5 5.5

-

-

-

-

-

-

5.7

5.6

5.6

5.5

5.5

5.5

-

-

-

-

-

-

100.0

100.0

100.0

100.0

100.0

100.0

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Table 79

Forecast Sales of NH Packaged Food by Category: Value 2014-2019

MYR million

---- NH High Fibre Food ----- NH High Fibre Bakery Products ------ NH High Fibre Biscuits ------ NH High Fibre Bread ------ NH High Fibre Breakfast Cereals ----- NH High Fibre Noodles ----- NH High Fibre Pasta ----- NH Rice ---- NH Honey ---- NH Oils and Fats ----- NH Olive Oil ----- NH Regular

© Euromonitor International

2014

2015

2016

2017

2018

2019

277.7 277.7

280.0 280.0

281.9 281.9

283.4 283.4

284.6 284.6

285.3 285.3

70.5

72.1

73.6

74.9

76.1

77.2

135.9

136.7

137.4

138.0

138.4

138.7

71.3

71.2

70.9

70.6

70.1

69.4

-

-

-

-

-

-

11.1 16.7 8.1 8.6

11.2 16.9 8.3 8.7

11.3 17.1 8.4 8.7

11.4 17.3 8.5 8.8

11.5 17.5 8.7 8.8

11.5 17.7 8.9 8.8

80

HEALTH AND W ELLNESS IN MALAYSIA

Spreadable Oils and Fats ---- NH Snack Bars ----- NH Fruit Bars ----- NH Granola/Muesli Bars ---- NH Sour Milk Products ---- NH Soy Products ----- NH Non-Dairy Milk Alternatives ------ NH Soy Drinks ------ NH Soy Milk ------ NH Other NonDairy Milk Alternatives ----- NH Soy-based Dairy Alternatives ------ NH Soy-based Chilled and Shelf Stable Desserts ------ NH Soy-based Yoghurt ----- NH Soy-based Meat Alternatives ------ NH Soy-based Frozen Meat Substitutes ------ NH Soy-based Ready Meals ---- Other NH Frozen Meat Substitutes ---- Other NH Ready Meals ---- NH Sweet and Savoury Snacks ----- NH Fruit Snacks ----- NH Nuts --- Naturally Healthy Packaged Food Source:

Table 80

Passport

7.4 7.4

7.4 7.4

7.5 7.5

7.5 7.5

7.6 7.6

7.6 7.6

-

-

-

-

-

-

415.7 415.7

423.9 423.9

431.4 431.4

438.2 438.2

444.2 444.2

449.4 449.4

415.7 -

423.9 -

431.4 -

438.2 -

444.2 -

449.4 -

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

295.3

290.7

285.1

279.7

274.6

268.7

51.1 244.2 1,023.9

51.7 239.0 1,030.2

52.2 232.8 1,034.3

52.7 227.0 1,037.5

53.0 221.5 1,039.8

53.3 215.4 1,040.2

Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources

Forecast Sales of NH Packaged Food by Category: % Value Growth 20142019

% constant value growth

---- NH High Fibre Food ----- NH High Fibre Bakery Products ------ NH High Fibre Biscuits ------ NH High Fibre Bread ------ NH High Fibre Breakfast Cereals ----- NH High Fibre Noodles ----- NH High Fibre Pasta ----- NH Rice ---- NH Honey ---- NH Oils and Fats ----- NH Olive Oil ----- NH Regular Spreadable Oils and Fats ---- NH Snack Bars

© Euromonitor International

2014/2015

2014-19 CAGR

2014/19 TOTAL

0.3 0.3 1.4 0.2 -0.9 0.7 1.1 2.2 0.1

0.5 0.5 1.8 0.4 -0.5 0.7 1.1 1.9 0.3

2.7 2.7 9.5 2.0 -2.7 3.5 5.7 9.9 1.7

0.5

0.7

3.5

81

HEALTH AND W ELLNESS IN MALAYSIA

----- NH Fruit Bars ----- NH Granola/Muesli Bars ---- NH Sour Milk Products ---- NH Soy Products ----- NH Non-Dairy Milk Alternatives ------ NH Soy Drinks ------ NH Soy Milk ------ NH Other Non-Dairy Milk Alternatives ----- NH Soy-based Dairy Alternatives ------ NH Soy-based Chilled and Shelf Stable Desserts ------ NH Soy-based Yoghurt ----- NH Soy-based Meat Alternatives ------ NH Soy-based Frozen Meat Substitutes ------ NH Soy-based Ready Meals ---- Other NH Frozen Meat Substitutes ---- Other NH Ready Meals ---- NH Sweet and Savoury Snacks ----- NH Fruit Snacks ----- NH Nuts --- Naturally Healthy Packaged Food Source:

Passport

0.5 1.2 1.2 1.2 -

0.7 1.6 1.6 1.6 -

3.5 8.1 8.1 8.1 -

-

-

-

-

-

-

-2.1 0.6 -2.8 0.0

-1.9 0.9 -2.5 0.3

-9.0 4.4 -11.8 1.6

Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources

© Euromonitor International

82

HEALTH AND W ELLNESS IN MALAYSIA

ORGANIC BEVERAGES IN MALAYSIA - CATEGORY ANALYSIS TRENDS  Organic beverages sales remain negligible in Malaysia in 2014  Organic beverages remains a niche area, with consumers instead tending to choose health and wellness products that are fortified/functional, naturally healthy or better for you  Whilst there are no leading players in this area, several health and wellness companies offer organic products through retail outlets and internet retailing  Country Farm Organics is popular for its wide range of organic products sold through its own stores, the internet and also Aeon Big while other popular internet retailers include Lohas Malaysia from Eco Life Valley and Antidote Health Store  Organic beverages will continue to grow, with products set to gradually become available in modern grocery retail outlets as a result of rising consumer health awareness  Manufacturers may look to organise frequent marketing campaigns to spread knowledge of the advantages of organic beverages and may also adjust unit selling prices to increase affordability as organic beverages are perceived as being expensive

© Euromonitor International

Passport

83

HEALTH AND W ELLNESS IN MALAYSIA

ORGANIC PACKAGED FOOD IN MALAYSIA - CATEGORY ANALYSIS HEADLINES  Organic packaged food gains 7% current value growth and records RM14 million in value sales in 2014  Strong distribution channels drive organic packaged food growth  Organic dried baby food most dynamic with 10% current value growth in 2014  Unit price increases for all categories in organic packaged food in 2014  Heinz (M) Sdn Bhd leads organic dried baby food in 2014 with 82% value share  4% constant value CAGR expected for organic packaged food over forecast period

TRENDS  Organic packaged food can be widely found on sale through modern grocery retail outlets such as supermarkets, hypermarkets and also via internet retailing. However, consumers are mainly purchasing organic packaged food through hypermarkets and supermarkets. This is because consumers can see the detail of the ingredients and other information on packaging. Furthermore, modern grocery retail outlets are located near to consumers’ homes, and also offer a wide range of variants for consumers to choose from.  Organic packaged food growth in 2014 was slower compared with the review period but continued to grow positively. The economic recovery in Malaysia drove organic packaged food to grow positively as consumers were able to spend more on healthy food. Consumers see organic products as becoming more important rather than as unnecessary indulgences. Although economic conditions caused consumers to spend less, they continued to buy organic packaged food products, preferring cheaper options or purchasing more during promotional periods.  Organic dried baby food was most dynamic with 10% current value growth in 2014. There were many organic dried baby food products selling through hypermarkets, supermarkets, convenience stores, independent small grocers, pharmacies and also via internet retailing. Parents have become more sophisticated and prefer organic food for their babies, as organic food is perceived to be more natural and thus healthier.  Manufacturers are requested to apply Halal certification in order to enable Muslim consumers to purchase such products. In addition, organic packaged food must be certified by Organic Malaysia as well as stating USDA Organic and the Non-GMO Project on packaging if the organic products are imported. This is to ensure the organic products are originally organic and safe for purchase by all consumers.  Organic soy milk was also performing well in 2014, gaining 7% in current value terms. Companies such as Yeo Hiap Seng (M) Bhd, Ace Canning Corp Sdn Bhd, Laboratorios Almond SL, The Bridge srl, Country Farms Sdn Bhd and Eden Foods Inc dominated sales with a combined 65% value share in 2014. These international and domestic players are able to offer quality organic soy milk with strong distribution channels.

© Euromonitor International

Passport

84

HEALTH AND W ELLNESS IN MALAYSIA

COMPETITIVE LANDSCAPE  Heinz (M) Sdn Bhd led sales in organic dried baby food in 2014 holding an 82% value share through sales worth RM3 million. The company offers various organic dried baby food options such as Heinz Sunrise Banana Cereal, Heinz Smooth Baby Rice, Heinz Oat & Apple Cereal, Heinz Fruit & yoghurt Cereal and Heinz Creamy Oat Porridge. Parents are able to find these variants in most hypermarkets and supermarkets with attractive price due to frequent promotional campaigns.  Laboratorios Almond SL saw the largest increase in value sales, gaining 14% value growth and recording a 4% value share in organic soy milk in 2014. The company offers Naturgreen organic soy milk which can be widely found for sale. The company also offers quality taste of organic soy milk as well as premium ranges.  There were no new organic products launched by large players in 2014 and at the end of the review period the category remained dominated by international players. The leading players continue to extend product lines by offering more variants within product categories and widening distribution channels to reach more consumers.  Organic packaged food is perceived as premium rather than standard or economy. Organic packaged food needs advanced technology for production in order to keep it fresh and stored for longer. Furthermore, there was a lack of private label products in 2014 in organic packaged food as private labels remained focused on regular packaged food.  Under organic soy milk, international players include Yeo Hiap Seng (M) Bhd, Ace Canning Corp Sdn Bhd, Laboratorios Almond SL, The Bridge srl and Eden Foods Inc, holding a combined 64% value share in 2014. Only one domestic player was found at the end of the review period, namely Country Farms Sdn Bhd, holding a 1% value share. Domestic players lack brand awareness campaigns and have narrow distribution channels compared with their international counterparts. International players are able to organise frequent marketing campaigns such as price discounts and bundle offers to attract consumer attention.

PROSPECTS  Consumers will continue to purchase more organic packaged food for themselves as well as for their children due to growing health awareness. Furthermore, internet retailing will grow further in coming years as consumers prefer convenient ways to buy packaged food and other groceries.  A CAGR of 4% in constant value terms is expected for organic packaged food over the forecast period. Organic packaged food is expected to grow as organic products are popular among consumers who are increasingly aware of their benefits. Roadshows, social media activities, media advertising and exhibitions are aggressively organised by companies and influence consumer perceptions regarding the benefits of organic packaged food. In addition, many consumers have long working days and tend to purchase more packaged food, yet prefer organic products offering health benefits.  The potential forecast threats to growth include inflation, consumer spending patterns and government policy reforms. Consumers might tend to spend less on premium packaged food even if it provides health benefits due to the increasingly high unit selling prices for commodity items. Consumers may not have extra budget available to spend on premium packaged food, and implementation of the goods and service tax may constrain consumer spending power.

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Passport

 Organic dried baby food is expected to perform well compared with other categories. Currently dominated by Heinz (M) Sdn Bhd, other players may erode Heinz’ share by offering more variants, implementing frequent brand awareness campaigns through media advertising, and widening distribution.  Unit prices for organic packaged food products are expected to fall over the forecast period. This is because companies and retailers might offer more price discounts and sales to encourage consumption, as consumers may spend more only during promotional periods due to budgetary constraints.

CATEGORY DATA Table 81

Sales of Organic Packaged Food by Category: Value 2009-2014

MYR '000

---- Organic Baby Food ---- Organic Bakery Products ---- Organic Canned/ Preserved Food Excluding Ready Meals, Soup and Pasta ---- Organic Chilled Processed Meats, Fish/ Seafood and Lunch Kit ---- Organic Confectionery ---- Organic Dairy ---- Organic Dessert Mixes ---- Organic Frozen Processed Food Excluding Ready Meals, Pizza, Soup and Noodles ---- Organic Ice Cream ---- Organic Noodles ---- Organic Oils and Fats ---- Organic Pasta ---- Organic Ready Meals ---- Organic Rice ---- Organic Sauces, Dressings and Condiments ---- Organic Snack Bars ---- Organic Soup ---- Organic Spreads ---- Organic Sweet and Savoury Snacks --- Organic Packaged Food Source:

Table 82

2009

2010

2011

2012

2013

2014

6,245.3 -

6,598.4 -

7,099.4 -

7,353.3 -

7,932.5 -

8,534.1 -

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

3,799.0 -

3,999.0 -

4,312.7 -

4,621.9 -

4,943.2 -

5,279.4 -

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

10,044.3

10,597.4

11,412.1

11,975.1

12,875.7

13,813.4

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Sales of Organic Packaged Food by Category: % Value Growth 2009-2014

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HEALTH AND W ELLNESS IN MALAYSIA

Passport

% current value growth

---- Organic Baby Food ---- Organic Bakery Products ---- Organic Canned/Preserved Food Excluding Ready Meals, Soup and Pasta ---- Organic Chilled Processed Meats, Fish/Seafood and Lunch Kit ---- Organic Confectionery ---- Organic Dairy ---- Organic Dessert Mixes ---- Organic Frozen Processed Food Excluding Ready Meals, Pizza, Soup and Noodles ---- Organic Ice Cream ---- Organic Noodles ---- Organic Oils and Fats ---- Organic Pasta ---- Organic Ready Meals ---- Organic Rice ---- Organic Sauces, Dressings and Condiments ---- Organic Snack Bars ---- Organic Soup ---- Organic Spreads ---- Organic Sweet and Savoury Snacks --- Organic Packaged Food Source:

2013/14

2009-14 CAGR

2009/14 Total

7.6 -

6.4 -

36.6 -

-

-

-

6.8 -

6.8 -

39.0 -

-

-

-

7.3

6.6

37.5

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Table 83

NBO Company Shares of Organic Packaged Food: % Value 2010-2014

% retail value rsp Company

2010

2011

2012

2013

2014

Heinz (M) Sdn Bhd Yeo Hiap Seng (M) Bhd Ace Canning Corp Sdn Bhd Laboratorios Almond SL Bridge srl, The Nestlé (Malaysia) Bhd Country Farms Sdn Bhd Eden Foods Inc Novartis Corp (M) Sdn Bhd Others Total

53.9 16.2 5.5 1.3 1.0 0.8 0.4 0.1 20.5 100.0

54.7 16.0 5.4 1.3 1.1 0.8 0.5 0.2 20.1 100.0

54.3 16.2 5.5 1.4 1.1 0.8 0.5 0.2 20.1 100.0

54.5 16.1 5.5 1.4 1.1 0.7 0.5 0.2 20.1 100.0

55.0 16.0 5.5 1.4 1.2 0.7 0.5 0.2 19.5 100.0

Source:

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Table 84

LBN Brand Shares of Organic Packaged Food: % Value 2011-2014

% retail value rsp Brand

Company

2011

2012

2013

2014

Heinz Yeo's

Heinz (M) Sdn Bhd Yeo Hiap Seng (M) Bhd

54.7 16.0

54.3 16.2

54.5 16.1

55.0 16.0

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Soyfresh Naturgreen The Bridge Gerber Country Farm Edensoy Gerber Others Total Source:

Passport

Ace Canning Corp Sdn Bhd Laboratorios Almond SL Bridge srl, The Nestlé (Malaysia) Bhd Country Farms Sdn Bhd Eden Foods Inc Novartis Corp (M) Sdn Bhd

5.4 1.3 1.1 0.8 0.5 0.2 20.1 100.0

5.5 1.4 1.1 0.8 0.5 0.2 20.1 100.0

5.5 1.4 1.1 0.7 0.5 0.2 20.1 100.0

5.5 1.4 1.2 0.7 0.5 0.2 19.5 100.0

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Table 85

Distribution of Organic Packaged Food by Format: % Value 2009-2014

% retail value rsp

Store-Based Retailing - Grocery Retailers -- Modern Grocery Retailers --- Convenience Stores --- Discounters --- Forecourt Retailers --- Hypermarkets --- Supermarkets -- Traditional Grocery Retailers --- Food/drink/tobacco specialists --- Independent Small Grocers -- Other Grocery Retailers - Non-Grocery Specialists Non-Store Retailing - Vending - Homeshopping - Internet Retailing - Direct Selling Total Source:

2009

2010

2011

2012

2013

2014

94.7 94.7 51.2

94.6 94.6 51.2

94.4 94.4 51.3

94.3 94.3 51.5

94.2 94.2 51.6

94.1 94.1 51.6

30.5 20.7 -

30.5 20.7 -

30.5 20.8 -

30.6 20.9 -

30.6 21.0 -

30.6 21.0 -

-

-

-

-

-

-

-

-

-

-

-

-

43.5

43.4

43.1

42.8

42.6

42.5

5.3 5.3 100.0

5.4 5.4 100.0

5.6 5.6 100.0

5.7 5.7 100.0

5.8 5.8 100.0

5.9 5.9 100.0

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Table 86

Forecast Sales of Organic Packaged Food by Category: Value 2014-2019

MYR million

---- Organic Baby Food ---- Organic Bakery Products ---- Organic Canned/ Preserved Food Excluding Ready Meals, Soup and Pasta ---- Organic Chilled

© Euromonitor International

2014

2015

2016

2017

2018

2019

8.5 -

8.9 -

9.3 -

9.6 -

9.9 -

10.1 -

-

-

-

-

-

-

-

-

-

-

-

-

88

HEALTH AND W ELLNESS IN MALAYSIA

Processed Meats, Fish/ Seafood and Lunch Kit ---- Organic Confectionery ---- Organic Dairy ---- Organic Dessert Mixes ---- Organic Frozen Processed Food Excluding Ready Meals, Pizza, Soup and Noodles ---- Organic Ice Cream ---- Organic Noodles ---- Organic Oils and Fats ---- Organic Pasta ---- Organic Ready Meals ---- Organic Rice ---- Organic Sauces, Dressings and Condiments ---- Organic Snack Bars ---- Organic Soup ---- Organic Spreads ---- Organic Sweet and Savoury Snacks --- Organic Packaged Food Source:

Table 87

Passport

-

-

-

-

-

-

5.3 -

5.5 -

5.7 -

5.9 -

6.1 -

6.3 -

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

13.8

14.4

15.0

15.5

16.0

16.4

Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources

Forecast Sales of Organic Packaged Food by Category: % Value Growth 2014-2019

% constant value growth

---- Organic Baby Food ---- Organic Bakery Products ---- Organic Canned/Preserved Food Excluding Ready Meals, Soup and Pasta ---- Organic Chilled Processed Meats, Fish/Seafood and Lunch Kit ---- Organic Confectionery ---- Organic Dairy ---- Organic Dessert Mixes ---- Organic Frozen Processed Food Excluding Ready Meals, Pizza, Soup and Noodles ---- Organic Ice Cream ---- Organic Noodles ---- Organic Oils and Fats ---- Organic Pasta ---- Organic Ready Meals ---- Organic Rice ---- Organic Sauces, Dressings and Condiments ---- Organic Snack Bars ---- Organic Soup ---- Organic Spreads ---- Organic Sweet and Savoury Snacks

© Euromonitor International

2014/2015

2014-19 CAGR

2014/19 TOTAL

2.3 -

3.5 -

18.7 -

-

-

-

3.2 -

3.6 -

19.5 -

-

-

-

-

-

-

89

HEALTH AND W ELLNESS IN MALAYSIA

--- Organic Packaged Food Source:

Passport

2.7

3.5

Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources

© Euromonitor International

19.0

90