Green Mountain Coffee Roasters, Green Mountain Coffee Roasters, Inc.Inc.

April 30, 2013

Hada Jang Shicheng Tang Yijin (Iris) Zhang

Agenda

Introduction

Company Overview

Industry Overview

Stock Performance

Financial Analysis

Valuation

Recommendation

2

Company Profile

Headquartered in Waterbury, Vermont

One of the leading companies in the specialty coffee and coffee maker businesses.

Employed about 5,800 people as of Sep 29, 2012

Top four best-selling coffeemakers by dollar volume in the United States

3Source: GMRC Inc. 2012 Annual Report

Company History

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1981: Green Mountain Coffee Roaster was established as a small café in Vermont

1993: GMCR started publicly trading on the NASDAQ national market

2006: GMCR acquired KEURIG, Incorporated, a manufacturer of single-cup brewing systems.

2010: Green Mountain Coffee acquired Diedrich Coffee for $305.3 million and bought coffee services company Van Houtte for $907.8M

1981 1993 2006 2010

2011: GMCR sold the "Filterfresh" US coffee service portion of Van Houtte's business to Aramark

2011

Source: GMRC Inc. 2012 Annual Report

Product Segments

The Company manages its operations through three operating segments, the Specialty Coffee business unit (“SCBU”), the KEURIG business unit (“KBU”) and the Canadian business unit (“CBU”).

SCBU sources, produces and sells coffee, hot cocoa, teas and other beverages, in a variety of packaging formats, to consumers in the United States.

KBU targets its premium patented single cup brewing systems for use both at-home (“AH”) and away-from-home (“AFH”), in the United States.

CBU sources, produces and sells coffees and teas and other beverages to Canadian consumers.

5Source: GMRC Inc. 2012 Annual Report

Sales Breakdown

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Net sales for fiscal 2012 increased 46% to $3,859.2 million, up from $2,650.9 million reported in fiscal 2011. The primary drivers of the increase in the Company’s net sales were a 59%, or $1,004.9 million, increase in single serve pack net sales, and a 45%, or $235.1 million, increase in KEURIG Single Cup Brewer and accessories sales.

Source: GMRC Inc. 2012 Annual Report

Historical Financials

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Source: Bloomberg Source: Bloomberg

Source: Bloomberg Source: Bloomberg

Competitive Strength – SWOT Analysis

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Strengths Weaknesses• Leading market position built on strong

product portfolio• KEURIG unit contributes to strong revenue

growth• Corporate image built on sustainability

initiatives• Customer loyalty

• Reliance on a single manufacturer in China for single cup brewers

• Dependence on certain retailer for a substantial portion of revenues

Opportunities Threats• Strategic agreements to bolster revenues• Entry into functional drinks market in the

US

• Competition in specialty coffee is intense • Increased demand for high-quality Arabica

coffee beans coupled with possible supply shortages

Source: Marketline

Porter’s Five Forces

9

Macroeconomic Indicators

10

Stock Performance

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Equity SnapshotEquity Snapshot

• Price: $ 56.47 (April 29, 2013)• Beta: 0.31 (0.94 on 5yr avg.)• Trailing P/E: 24.39• Forward P/E: 17.54• PEG Ratio (5 yr. expected):

1.04 • P/B Ratio: 3.63• No divined

Source: Finance.yahoo.com

Stock Performance

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Key Financial Ratios

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SBUX DNKN JVAFor the Fiscal Period Ending 2008 2009 2010 2011 2012 2012 2012 2012Profitability Return on Assets % 9.0% 8.2% 9.0% 10.4% 10.4% 14.5% 4.9% 7.1% Return on Equity % 18.2% 15.0% 12.4% 15.3% 17.3% 21.2% 7.1% 11.4% Gross Margin % 35.3% 31.2% 31.4% 34.1% 32.9% 56.3% 78.8% 6.9% EBIT Margin % 9.1% 9.7% 11.6% 14.3% 14.7% 13.5% 38.4% 2.5% Net Income Margin % 4.4% 6.9% 5.9% 7.5% 9.4% 10.4% 16.5% 1.4%

Activity Fixed Asset Turnover 6.0x 6.7x 6.9x 6.3x 5.1x 5.3x 3.6x 88.6x Inventory Turnover 5.1x 5.0x 4.7x 3.7x 3.6x 5.3x NA 12.3x

Liquidity Current Ratio 2.1x 4.2x 2.1x 2.4x 2.5x 1.9x 1.2x 3.7x Quick Ratio 0.8x 3.0x 0.8x 0.7x 0.9x 1.1x 0.8x 2.3x Avg. Cash Convers ion Cycle 65.1 68.8 75.0 96.4 97.9 53.0 NA 35.5

Solvency Tota l Debt/Equity 89.0% 13.8% 51.1% 30.7% 23.8% 10.7% 531.6% 3.9%

GMCR

Source: Capital IQ

2008 2009 2010 2011 2012Net Income Margin % 4.4% 6.9% 5.9% 7.5% 9.4% Total Asset Turnover 1.6x 1.3x 1.2x 1.2x 1.1xFinancial Leverage 2.61 1.61 1.70 1.75 1.62Return on Equity % 18.2% 15.0% 12.4% 15.3% 17.3%

DuPont Analysis

Valuation – Trading Comparables

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Company Comp Set4/23/2013

Enterprise Value / Price NTM Enterprise Value

Company Name EBITDA EBIT EPSForward Total

Revenue Forward EBITDA NTM Forward P/E

Green Mountain Coffee Roasters, Inc. (NasdaqGS:GMCR) 10.6x 14.1x 23.8x 1.84x 9.0x 18.85x

Flowers Foods, Inc. (NYSE:FLO) 15.6x 22.5x 33.0x 1.41x 12.0x 23.95xGeneral Mills, Inc. (NYSE:GIS) 11.5x 13.7x 18.5x 2.26x 11.4x 17.91xHil lshire Brands Company (NYSE:HSH) 8.9x 12.4x 60.5x 1.22x 10.0x 21.62xMcCormick & Company, Incorporated (NYSE:MKC) 15.1x 17.7x 23.4x 2.50x 14.3x 22.05xThe Hain Celestial Group, Inc. (NasdaqGS:HAIN) 18.0x 21.5x 26.6x 1.90x 13.9x 23.94xThe Hershey Company (NYSE:HSY) 15.3x 17.7x 31.3x 3.02x 13.7x 24.72xThe J. M. Smucker Company (NYSE:SJM) 10.5x 13.1x 21.9x 2.13x 10.1x 18.51xThe WhiteWave Foods Company (NYSE:WWAV) 14.6x 20.7x 23.5x 1.48x 13.2x 24.31xTreehouse Foods, Inc. (NYSE:THS) 10.7x 16.1x 27.1x 1.38x 9.8x 20.92x

High 18.0x 22.5x 60.5x 3.0x 14.3x 24.7xLow 8.9x 12.4x 18.5x 1.2x 9.8x 17.9xMean 13.4x 17.3x 29.5x 1.9x 12.0x 22.0xMedian 14.6x 17.7x 26.6x 1.9x 12.0x 22.1x

LTM EBITDA LTM EBIT LTM EPS NTM Revenue

/Share NTM EBITDA NTM EPS Green Mountain Coffee Roasters, Inc. (NasdaqGS:GMCR) 750,543 568,896 2.44 31.0 772,821 2.72

Implied Price_Mean $67.36 $66.01 $71.97 $59.61 $62.55 $59.83Implied Price_Median $73.64 $67.67 $64.82 $58.92 $62.32 $59.98

4/23/2013 Close Price

Shares Outstanding

Market Capitalizatio

Green Mountain Coffee Roasters, Inc. (NasdaqGS:GMCR) 56.55 148,809 8,888,799

Peers in Processed & Packaged Goods Industry

Equally Weighted Average Price

$64.56

Valuation – Trading Comparables (Cont’d)

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Company Comp Set4/23/2013

Enterprise Value / Price NTM Enterprise Value

Company Name EBITDA EBIT EPSForward Total

Revenue Forward EBITDA NTM Forward P/E

Green Mountain Coffee Roasters, Inc. (NasdaqGS:GMCR) 10.6x 14.1x 23.8x 1.84x 9.0x 18.85x

Coffee Holding Co.Inc. (NasdaqCM:JVA) 9.4x 10.7x 24.6x 0.22x - 9.05xDunkin' Brands Group, Inc. (NasdaqGS:DNKN) 17.2x 20.3x 41.0x 8.04x 15.2x 24.53xFarmer Brothers Co. (NasdaqGM:FARM) 10.7x NM NM 0.48x 5.3x 27.80xStarbucks Corporation (NasdaqGS:SBUX) 15.3x 19.6x 30.5x 2.72x 13.0x 25.17x

High 17.2x 20.3x 41.0x s 15.2x 27.8xLow 9.4x 10.7x 24.6x 0.2x 5.3x 9.1xMean 13.2x 16.9x 32.0x 2.9x 11.2x 21.6xMedian 13.0x 19.6x 30.5x 1.6x 13.0x 24.9x

LTM EBITDA LTM EBIT LTM EPS NTM Revenue

/Share NTM EBITDA NTM EPS Green Mountain Coffee Roasters, Inc. (NasdaqGS:GMCR) 750,543 568,896 2.44 31.0 772,821 2.72

Implied Price_Mean $66.32 $64.48 $78.06 $88.84 $57.99 $58.86Implied Price_Median $65.57 $74.93 $74.32 $49.62 $67.51 $67.60

4/23/2013 Close Price

Shares Outstanding

Market Capitalization

Green Mountain Coffee Roasters, Inc. (NasdaqGS:GMCR) 56.55 148,809 8,888,799

Competitive Coffee Stocks

Equally Weighted Average Price

$67.84

Valuation – WACC Analysis

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Capital StructureTotal Market Value of Equity 8,415,124Total Debt 473,675Total Capitalization 8,888,799 Debt-to-Total Capitalization 5.33%Equity-to-Total Capitalization 94.67%

Beta 0.31Risk-Free Rate 1.67%Market Risk Premium 7.00%Cost of Equity (CAPM) 3.84%Cost of Equity 11.92%Weighted Cost of Equity 7.88%

Cost of Debt 5.50%Tax Rate 37%After-tax Cost of Debt 3.47%

WACC (only CAPM) 3.82%WACC 7.65%

WACC CalculationYear GMCR2008 -22.28%2009 129.56%2010 -50.43%2011 97.09%2012 -53.88%

5-Year Total Return 75.62%

Annual Compounded Return 11.92%

Realized Annual Return

Valuation – Revenue Projection

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FY 2009: acquired the wholesale business and certain assets of Tully’s Coffee Corporation

FY 2010: acquired Timothy’s Coffee of the World Inc. (Nov 13, 2009); Diedrich Coffee, Inc. (May 11, 2010)

FY 2011: acquired LJVH Holdings, Inc. and Subsidiaries (“Van Houtte”) on December 17, 2010

Valuation – DCF

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Risks & Drivers

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Recommendation

20

Watch List

Questions?

Thank you

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