ARBORGEN

• Technology Platform
• Business Model
• Sustainable Future
• Positioned for Growth

Business Model

• ArborGen is building a high growth business by utilising a business model similar to that which has been successfully applied in agriculture, where seed companies have introduced genetically-improved crops that have dramatically improved returns per acre as compared to their conventional seed competitors. Through increased pricing, these seed companies are sharing in the higher value their advanced products create for their customers.
• Forestry is many years behind agriculture, but with the application of new technology ArborGen has a leadership position in the commercialisation of advanced forestry genetics.

• Although there are differences between the forestry industry and agriculture, such as increased rotation length for trees as compared to agricultural crops, ArborGen believes its next-generation seedlings will have a significant impact on the productivity and economics of the commercial forestry industry, similar to the impact that improved crops have had on the agricultural industry.
• While traditional silvicultural and forest management practices have added value, it is genetics that will truly be the game-changer in forestry.

• ArborGen is focused on driving these improved economics by transitioning its customers from conventional seedling products to its next-generation advanced genetic products.
  • This has already occurred in New Zealand, where advanced genetics make-up ~80% of ArborGen New Zealand’s total radiata pine seedling sales each year.
  • In the much larger US market, only an estimated 14% of open market loblolly pine sales are currently advanced genetics. The total loblolly pine market at mid-cycle is estimated to be ~1B seedlings per annum., representing ArborGen’s immediate scale market opportunity.
  • ArborGen has also established a core foothold in Brazil, where it is currently developing and trialling its improved genetic products in eucalyptus and loblolly pine. Brazil is a large market, where (for example) mid-cycle eucalyptus plantings are projected to be ~800+ million per annum.
• ArborGen is also investigating expanding into new markets and geographies, where its products, technology, and partners, position it for rapid growth. By way of example, ArborGen currently has trials well-established in China, as a potential growth-market opportunity in future.