1. Retail Market Overview Update to 29 February 2004 Original presentation delivered by Sean Botha

2. Contents 1.Total seafood  Highlights  Chilled & frozen spend & volume  Multiples vs. non-multiples 4. Frozen seafood  Market health check  Branded vs. private label spend 7. Hot topics  Hot topic 1: Demographics  Hot topic 2: Shellfish  Hot topic 3: Northern Ireland 6. Comparison of proteins  Key performance indicators 3. Total chilled seafood  Market health check  Long-term trends in penetration  Top 5 species  Sector share of spend 5. Chilled natural salmon  Analysis of weekly volumes 2. Long-term trends  Chilled vs. frozen expenditure  Chilled vs. frozen volume

3. Total seafood highlights  Total spend on seafood in multiples is nearly £1.6 billion in the latest year, an increase of 9.6% on last year.  The strongest year-on-year value growth was seen by Tesco, followed by Waitrose and Safeway respectively. (52 weeks ending 29 February 2004) +8% Independents: 1% Co-ops: 2% Other non-grocers: 7% Freezer Centres: 2% Total seafood - share of spend +2% +6% SpendVolumeAverage price change since last year  Other non-grocers (which includes fishmongers) experienced a 7% year-on-year decline in spend.  Seafood has the one of the strongest year-on- year growth rates out of all proteins in retail.  Total seafood reached its highest average price over the 4-weekly period ending 04 January 2004, when it reached £7.13 per kg. Multiples: 88%

4. Chilled seafood volume is almost as high as frozen, and with the current strong growth rate it is anticipated that chilled seafood volume will exceed frozen before the end of 2004. Total Seafood Chilled & frozen spend & volume

5. Total Seafood Multiples vs. non-multiples (expenditure) £1.79 billion £1.65 billion £1.56 billion * Please note that Marks & Spencer and Iceland are included in ‘Total Multiples’ Total spend Multiples (which includes M&S and Iceland) have increased their share of the total seafood market spend by 10%, while non-multiples lost 1%. Tesco hold the greatest share of spend and have seen the highest growth, with Sainsbury’s following closely. Strong growth rates for Asda means they are gaining market share on Marks and Spencer.

6. Chilled seafood expenditure exceeded frozen in 1996, but growth remained relatively static until 1998. From 1992 to 2003, chilled seafood expenditure has more than doubled and now stands at over £1 billion. Frozen seafood expenditure declined by £10 million over the period 1996 - 1998, but has since recovered. * Annual data is up to end of December/start of January. Long-term trends Chilled vs. frozen expenditure

7. Frozen seafood volume remains higher than chilled, but is currently in decline (year-on-year). Chilled volume is expected to surpass frozen before the end of 2004 if the current rising trend continues. Long-term trends Chilled vs. frozen volume

8. Total chilled seafood Market health check Expenditure (£000's) Change Vs last year Volume (tonnes)Price (£/kg) Change Vs last year Penetration (%)Avg Weight of Purchase (kg) Change Vs last year Frequency of Purchase Volume per Trip (kg) Change Vs last year 1,057,420 +11% 138,1297.66 +4%+6% 827 +1+3% 15 times/yr 0.5 +3%+1% 52 w/e 29 Feb 04 The increased expenditure on chilled seafood is a result of consumers purchasing more expensive chilled seafood more frequently

9. 5 years ago 19 million households were buying chilled seafood in a year; between 1999 and 2001, 860,000 new households started buying chilled seafood. In the last year, over 20 million households have purchased a type of chilled seafood at least once. NB! Calculations based on 24.5 million GB households Total Chilled seafood Long-term trends in penetration (%)

10. Total chilled seafood Top five species - spend, volume & average price (% change vs. last year) Although salmon accounts for the highest share of chilled seafood spend (31%), Prawns have gained share in the last year and now account for a 12%share. TNS Superpanel, 52 w/e 29 Feb 04

11. Total chilled seafood Sector share of spend and yr-on-yr change Share of expenditure by sector % expenditure change 04 vs 03 Added value seafood and chilled shellfish are driving growth in total chilled seafood spend; added value seafood is now the second largest sector in spend share terms. TNS Superpanel, 52 w/e 29 Feb 04

12. Total frozen seafood Market health check Expenditure (£000's) Change Vs last year Volume (tonnes)Price (£/kg) Change Vs last year Penetration (%)Avg Weight of Purchase (kg) Change Vs last year Frequency of Purchase Volume per Trip (kg) Change Vs last year 728,681 +5% 143,2035.09 n/c+4% 88.6 -1%+1% 11 times/yr -1%+2% 6.6 0.6 TNS Superpanel, 52 w/e 29 Feb 04 During the first 2 months of 2004, frozen seafood volumes recovered from their decline. Although less people are buying frozen seafood less often, higher volumes are purchased at each shopping trip (possibly due to promotions).

13. Total Frozen Seafood Expenditure - Branded vs private label Private label frozen seafood expenditure has increased by 12% since last year; the share between branded and private label frozen seafood is now almost the same. Looking at the 4 months since the start of November 2003, private label share of spend has actually exceeded branded (52% vs. 48%).

14. +22% -12% -20% % change 2004 v 2003 Negative press hit The effect of the salmon scare on the chilled natural salmon in retail market seems to have continued into February. Weekly volumes for the week ending 08-Feb-04 were 38% lower than the same week the previous year, however the volumes have since recovered. Please note that the drop in volumes cannot be solely attributed to the negative press coverage. -38% Chilled natural salmon 3-year comparison of weekly volumes (tonnes)

15. Primary beef Primary lamb Primary chicken Primary pork Total seafood 3,0091,435513432 * Percentage of GB population purchasing over 4 weeks ending 04-Jan-04 † Volume (grammes) purchased over 4 weeks ending 04-Jan-04 1,778 67.9 1,211 280.4289.989.5739.4158.6 £6.34 £4.95£5.73£3.41 TNS Superpanel 52 w/e 04-Jan-04 £4.10 56.9 23.580.738 1,5951,1962,8751,310 Total seafood is the second largest protein in terms of expenditure and penetration, (after chicken) and commands the highest average price. Comparison of proteins Key performance indicators Expenditure (£ million) Volume (KG million) Avg price (£/kg) Penetration (% of GB population) AWP volume (grammes)

16. Hot Topics DemographicsShellfishNorthern Ireland

17. TOTAL GB POPULATION Total frozen fish Total chilled natural white fish Total chilled white fish Total frozen natural white fish Total frozen salmon Total chilled fish Total chilled salmon Total frozen white fish Total frozen natural salmon % of population in social classes ABC1 % of population aged 16 - 44 years Younger & lower social classYoung & higher social class Older & higher social class Older & lower social class Total chilled natural salmon Chilled salmon appeals to more consumers in social classes ABC1 than frozen salmon. Chilled natural white fish has less appeal for consumers of younger ages than frozen white fish. Demographics Demographic map of selected fish types

18. Chilled natural salmon TOTAL FISH Chilled natural white fish Frozen natural salmon Frozen natural white fish 2 members3 members4 members5+ members1 member Demographics Fish - volume share by size of household More households with 5+ members prefer to buy frozen natural white fish than total fish. Overall, 2- member households buy the majority of fish, and this is particularly the case in the chilled sector.

19. Total chilled natural warm water prawns TOTAL GB POPULATION Total frozen natural shellfish Total chilled fish Total frozen natural warm water prawns Total frozen shellfish Total chilled natural cold water prawns Total chilled shellfish Total frozen natural cold water prawns % of population in social classes ABC1 % of population aged 16 - 44 years Younger & lower social classYounger & higher social class Older & higher social class Older & lower social class Total frozen fish Demographics Demographic map of selected shellfish types Chilled natural warm water prawns are mostly purchased by consumers in social classes ABC1; these consumers tend to be younger than purchases of frozen natural warm water prawns.

20. Demographics Regional volume share of selected seafood In general consumers living in London purchase the largest share of fish volumes in GB, followed by the Midlands and Lancashire. Chilled seafood is particularly popular in London, while frozen seafood is favoured more by consumers in Lancashire. Total volume (tonnes) 24,280 6,149 107,772 15,484 22,124 143,203 138,139 281,332 TNS Superpanel, 52 w/e 29 Feb 04

21. Total prawns Total crab sticks Total mussels Total crab Total chilled shellfish Expenditure (£ million) Volume (KG million) Avg price (£/kg) Penetration (% of GB population) AWP volume (grammes) 11.219.18.9 183.7 TNS Superpanel 52 w/e 29-Feb-04 % change +20% +28%+3%+18%-13% 130.1 2.54.70.9 21.7 +10% +15%+3%+17%-21% 12.6 4.564.109.53 8.47 +9% +11%N/C+1%+11% 10.32 713.74.3 45.4 +2% +4%-6%+8%-21% 36.9 1,4271,387884 1,952 +8% +10% +8%-1% 1,393 N/C = No Change Shellfish Key performance indicators of top chilled species

22. Total prawns Total scampi Total lobster Total calamari Total frozen shellfish Expenditure (£ million) Volume (KG million) Avg price (£/kg) Penetration (% of GB population) AWP volume (grammes) 4.345.51.3 171.9 TNS Superpanel 52 w/e 29-Feb-04 % change +11% +13%+15%+20%-18% 117 0.45.20.3 24.3 -4% +8%+18% -48% 17.4 9.748.694.68 7.08 +16% -15%+6%+2%+58% 4.17 3.219.61.3 50.3 -4% -6%+1%+34%-39% 41.9 5541,088854 1,971 N/C +2%+7%-12%-15% 1,697 Shellfish Key performance indicators of top frozen species N/C = No Change Data refers to TOTAL shellfish by species

23. 2001 20022003 Shellfish Volume trends of natural chilled prawns by type Volumes of natural chilled warm water prawns have increased over the last three years; over the 4-weeks ending 07 December 2003, they reached their highest ever level of volume sales (341 tonnes). Natural chilled cold water prawns still represent the largest share of natural chilled prawn volumes (63%over the latest 4-week period). 2004 * Not applicable refers to prawns which cannot be identified as cold or warm water.

24. 2001 2002 Shellfish Volume trends of natural frozen prawns by type 2003 2004 Trends of natural frozen prawns are more erratic, possibly as a result of higher promotion activity. Higher sales occur over the Christmas and Easter periods. A small proportion of frozen warm water prawns are purchased in the retail sector (59 tonnes over the latest 4-weekly period). * Not applicable refers to prawns which cannot be identified as cold or warm water.

25. ChilledFrozenTotal seafood Northern Ireland Key performance indicators Growth in spend on seafood in Northern Ireland is strong, particularly in the chilled sector. Chilled smoked fish represents 28% share of chilled spend (16% of total spend), and increased sales by 109% since last year - total spend came to just over £7 million for the year ending 29 February 2004. 18.9 44.5 +14% +32%-4% 25.5 % change vs previous year 3.6 6.8 +6% +28%-8% 3.1 % change vs previous year 5.21 6.58 +8% +3%+4% 8.19 % change vs previous year 88.2 96.1 +2% -1%+5% 73.8 % change vs previous year 6,995 11,916 +8% +3%+4% 7,162 % change vs previous year TNS Superpanel, 52 w/e 29-Feb-04 Expenditure (£ million) Volume (KG million) Avg price (£/kg) Penetration (% of GB population) AWP volume (grammes)

26. 281,3326,75514,658 Frozen Chilled In both NI and ROI chilled seafood has increased its share of the market from last year, based on greater growth rates relative to the frozen sector. The situation changes across markets with respect to expenditure, chilled seafood accounting for the greater share. Great Britain ValueVolume N. Ireland ValueVolume R. of Ireland ValueVolume 1,786,10144,452133,378 Northern Ireland Total seafood value & volume share TNS Superpanel, 52 w/e 29-Feb-04

27. = Salmon is responsible for the greatest share of the chilled market, also experiencing considerable growth in the last year. Although Prawns/Scampi hold a smaller share of volume, growth has been impressive. Total chilled smoked fish species have performed extremely well in the latest year, increasing volume sales by 87% to 716 tonnes. 15% 1% 2% 60% 22% 1% Northern Ireland Volume (tonnes) of chilled seafood species TNS Superpanel, 52 w/e 29-Feb-04 87%

28. Sean Botha Market Insight Executive s_botha@seafish.co.uk 0131 524 8631 For further information please contact: