POSITIONED

Delivering Results

FOR GROWTH

Analyst & Investor Day

October 14, 2015

John E. Adent

CEO, Patterson Animal Health

JOHN ADENT

2

• Former president and CEO, Animal Health International, Inc.

• 25-year agriculture industry veteran

• Former chairman of the National Future Farmers of America Foundation sponsor’s board

• Colorado Agriculture Hall of Fame

CEO, Patterson Animal Health

3

Key Milestones

Walco Founded

1954

Great Plains Chemical Founded

1967

Great Plains Chemical Changes Name to Lextron

1986

Webster Veterinary Joins with Patterson Companies

2001

Walco Goes Public as Animal Health International

2007

Patterson Veterinary & Animal Health International Combine Forces 2015

4

Lextron Acquires Animal Health International & Takes Company Private Walco & Lextron Join to Become Animal Health International

2011

Creating a New Model for Our Industry

15 years ago

• Distributors specialized in either companion or production

• 50+ manufacturers

Today

• Manufacturers blurring end-market distinctions, with five companies in BOTH companion & production markets

• Only two distributors have national coverage in both companion & production

Tomorrow

• Companion & production animal markets under one name is NEXT LEVEL of consolidation

• Distributors providing value-added services are more efficient & offer a cost-effective way to serve the market

5

Consolidation

by the Numbers

Animal Health Manufacturer Consolidation

14%

8%

9%

12%

6%

51%

2000

Merial Bayer

Intervet Pfizer

Fort Dodge Other

14%

8%

5%

11%

7%

55%

2008

Merial Bayer

Merck Pfizer

Fort Dodge Other

11%

7%

15%

20% 15%

32%

2015

Merial Bayer

Merck Zoetis

Elanco Other

6

Distributors in 2001

Vet Medical

Supply

Vetpo

7

Burns

Veterinary

Supply, Inc.

Distributors in 2015

8

Animal Health as a Single Platform

Broad

coverage in

all species

Market leader in

beef, dairy, swine

and dealer

markets across

multiple product

categories

Strong long-term

relationships

with diversified

customer base

Deep product

portfolio and

value-added

services

Significant

revenue and

operating

synergies

9

Global

Opportunity –

The Protein

Imperative

10

More People, More Prosperity, More Protein

Global production animal health market is

projected to grow at CAGR of 5%

Today 2050

2 billion

increase

7.0B

9.0B

Global Population

Today 2050

Nearly

tripling

in size

1.8B

4.8B

Global Middle Class

More animal

protein production

required to sustain

trends

100 %

Required Animal Protein

11

Projected Protein Growth

45

40

35

30

25

20

15

10

1990 2000 2005 2010 2015 2020 2025

U.S. Red Meat and Poultry Production* Billion pounds

Poultry

Beef

Pork

100

90

80

70

60

50

40

30

1990 2000 2005 2010 2015 2020 2025

U.S. Per Capita Meat Consumption* Pounds per capita retail weight

Poultry

Beef

Pork

12

*Source: USDA

The U.S. Will Lead in Production/Exports

20

18

16

14

12

10

8

6

4

2

0

1990 2000 2005 2010 2015 2020 2025

U.S. Meat Exports* Billion pounds

Poultry

Beef

Pork

13

*Source: USDA

Our

Portfolio

14

Deep Product Offering

Animal health (production & companion) market share by

species, 2014

40% 43%

40%

14% 12%

4%

22%

0%

25%

50%

Production Swine Ruminant Equine Other SmallAnimal

Overallshare

36% 35%

25%

19%

15% 13%

0%

25%

50%

Antibiotics Hormones Vaccines Pharma Others Anti-

Parasitics Antibiotics Hormones Vaccines Pharma Others

Animal health (production & companion) market share by

product, 2014

Antibiotics & Hormones are

two key product categories

Swine & Ruminant –

Currently holds ~40% share

15

Antibiotics Hormones Vaccines Pharma Others Anti-

Parasitics

50% 25% 0%

Dairy 29.3%

Beef 33.0%

Swine 17.6%

Companion 12.4%

Revenue Mix by Species

16

Other 0.5%

Equine 0.9%

Poultry 1.3%

Mixed 5.0%

Recent Technology Investments

Utilizing Technology to Drive Revenue, Profitability & Customer Retention

ERP system for Producers

Only fully integrated system that supports health & feed on same platform

2013 Jan

2013 July

2013 July

B2B customer portals

Utilized EDI technology for seamless integration

2014 Nov

Acquired Turnkey Computer Systems

Launched New eCommerce Platform

Proprietary mobile application for sales rep

Real time marketing tool to push promotions & sales analytics

Developed Informed Rep Application

Cloud-based automated dispensing solution

Transactions processed & authenticated in real time

Launched New Apex Systems

Utilizing data capture to understand pricing leverage

Increase margin & focus salesforce

Zilliant-enabled Pricing Strategies

Now

17

Production Dynamics

Revenue timing can be affected by:

Regardless of economic cycles, we help

producers maximize profit & minimize loss

Weather Seasonality Animal Life

Cycles

18

Minimal Correlation to Feed Cost

Fluctuations

$0

$20

$40

$60

$80

$100

$120

2010 2011 2012 2013 2014

Total Spend/Animal/cwt Gain Vet Medicine Spend/cwt Gain Feed Cost/cwt Gain

19

Beef Input Costs

Revenue by Product Category

Biologicals 17%

Parasiticides 9%

Diet 8%

Pharma 8%

Antibiotics 28%

Diagnostics 1%

Livestock ID 2%

Equipment 3%

Med/Surg. 3%

Implants 4%

Feed Additives 4%

Other 6%

Micro-Ingredients

7%

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Antibiotics in Production Animals

Therapeutic (treatment and control) Growth Promotion

Use Treat or prevent certain illnesses caused

by bacteria Prevent disease among animals

susceptible to infections

Dosage Large dose per unit of animal weight –

swift and complete recovery Low dose per unit of animal weight –

usually as continual / daily feed

Species Used in all animals Greater usage in animals raised in

confined spaces, e.g., swine, poultry

Availability Primarily requires prescription (Rx) Primarily over the counter (OTC)

Product Type Injectable Feed additives

21

Minimal Revenue Implications

Others

Implants

Dewormers - Rumen

Dairy Inst/Supplies

Biologicals - Swine

Pharmaceuticals

Biologicals - Rumen

Antibiotics

Feed Additives

FY 2014

$1,316M

25%

4%

5%

6%

6%

9%

10%

23% ($300M)

12% ($155M)

~$50M

~$105M Other Feed Additives

Preventative/ Growth Use Antibiotics

Feed Additives

$155M

U.S. Animal Health International revenue

Product categories at risk

Antibiotics

Therapeutic Use

Small revenue level at risk

Impacted category

Feed Additives Category

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<$50M

Non-impacted category

$300M

Growth Promotant vs. Therapeutic:

A Zero-Sum Game

Aggregate Antimicrobial Use in Danish Swine Industry

220

180

140

100

60

20

1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

35

25

15

5

Prescribed human antibacterials Antimicrobial growth promoters Prescribed veterinary antimicrobials Pigs produced (mill. heads)

23

AGP ban and ban on vet sales DAN MAP 2012

Our

Customers

24

Highly Diversified Business

Producers / Farmers

Dairy Swine Beef

Number of customers 728K

64K 63K

Percent of total business revenue from

top 10 customers

3% 2% 4%

Vet Clinic

Production

4.6K

5%

25

Strong Customer Retention

0.0% 0.0% 0.1%

0.5%

1.9%

0.0%

1.0%

2.0%

3.0%

Top1000

1001 -2500

2501-5000

5001-10000

10000+

28%

40%

26%

5% 1%

0%

50%

Top 100 101 -1000

1001 -5000

5001-10000

10000+

Customer base tends

to be sole sourced … with low churn … and low concentration

Customer concentration % of revenue

Customer churn, FY13 to FY14

0.0 0.0 0.1 0.3 0.3 Rev. lost ($M)

651 187 102 62 18 Rev. FY13 ($M)

Market survey: Allocation of animal health spend

75% 73%

15% 19%

11% 8%

71

Vet clinics

Manufacturer

Production farms

Primary distributor

Other

34

26

Our Opportunity

Definition

Customer

type

Type of

products sold

Domesticated animals raised for food (e.g., cow, chicken, hog)

Distribution

Production market, $5B Companion market, $4B

Producers, farmers, veterinarians and dealers

Pets (e.g., dogs, cats, equine)

Veterinarians

Direct for large farms and small/mid- size retail/veterinarians

Mostly parasiticides, pharmaceuticals

Direct to veterinarians

Mostly antibiotics, biologicals, parasiticides

Global animal health market, $23B

United States, $9B Outside U.S., $14B

27

Attractive Long-Term Business

‘11-’16F ‘14-’20F ‘14-’19F ‘13-’18F ‘11-’16F ‘13-’18F ‘14-’20F ‘14-’18F ‘14-’20F ‘15-’20F ‘14-’20F ‘14-’20F

Consensus forecast range

Third-party market research firms

Distributors Manuf.

Public companies

Global North America

Animalytix RAMSAnimalytix

CowenandCo.

BCCRes.

Tech.Accl.

Partners

Vetnosis Free-doniaGroup

CowenandCo.

Transp.Mkt.Res.

Sundale HenrySchein

MWI Merck Zoetis

Production only

4.0% 4.2%

5.7% 6.0%

3.5% 4.0%

4.7% 5.0% 5.3%

9.5%

1.3%

5.1%

28

Projected Industry Growth Rates

Source:

Forecast

period:

Market Growth + Share Gains

5%

Price growth Animal inventory growth

1-2%

Overall growth

1-2%

Growth in spend, per animal

0.25- 0.75%

1-2%

Share gain growth

Market growth

~4-6%

29

OUR COMPETITIVE

ADVANTAGE

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Solutions for Cattle Livestock Lifecycle

Ordering/ Receiving Ingredients

Ordering/ Receiving Commodities

Receive Cattle Bunk Reading Feed Manufacturing

Feed Scheduling Delivering

Feeding Health Treatments

Processing Cattle Movement

Shipping Environment

Turnkey

Systems

Micro Tech

Micro Machines Control Solutions Grain Solutions

Data Capture Capabilities for Business Analytics

31

Proprietary Systems Driving

Customer Loyalty

32

• ERP system for cattle producers

• Only fully integrated system that supports health & feed on same platform

• Multi-user / multi-site capabilities

• 60% of U.S. feedlot cattle tracking on Turnkey Systems

• Enabled real-time management of feedlot

• License fee drives recurring revenue

• International reach

• Largest development staff in industry

Proprietary Systems Driving Customer Loyalty

Health

Management

Payroll General

Ledger

Data

Analytics &

Reporting

Risk

Management Cattle

Inventory

Accounts

Receivable &

Payable

Product

Inventory

Feed

Management

The Company Owns the Captured Animal Health Data

• Utilize in consultative selling • Potential to monetize with manufacturers

33

34

CAPITALIZING

ON AN

ANIMAL HEALTH

MARKET LEADER

35

Largest Animal Health Distributor in the U.S.

Animal health (production & companion) market share

by species, 2014

Animal health (production & companion) market share

by product, 2014

40%

45% 42%

28%

23% 25%

22%

0%

25%

50%

Production Swine Ruminant Equine Other SmallAnimal

Overallshare

50% 25% 0%

50% 25% 0%

40%

20%

0%

39%

Antibiotics Hormones Vaccines Pharma Others Anti-

Parasitics

40%

35%

30%

23%

28% 33%

36

Value-Added Services Overview

Cattle Swine Retail Veterinary Poultry

• Turnkey ERP systems

• MicroTech systems

• GPS-monitored feeding

• Herd sorting technology

• Vet traceability records

• Automated inventory control w/RX Tracking

• Genomics-based feeding

• On-staff veterinarians

• Dedicated service staff

• Milk laboratory

• Biosecurity protocols

• Clean and dirty warehouses

• Limited access fleet

• On-staff veterinarian

• Distribute commodity products to limit cross contamination

• Water-soluble medication technology

• Waste lagoon consulting

• Category management for multi-unit customers

• Master merchant programs for independent customers

• B2C back-end fulfillment

• Training store personnel on product knowledge

• Broad capital equipment portfolio

• National technical service network

• Industry-leading technology platform

• Prescription home delivery platform

• Patterson Veterinary University education

• Patterson Software Connection

• Water-soluble medication technology

• Insect control programs

• Rodent control programs

• Water quality management techniques

• Litter amendments

37

COMPANION ANIMAL SLIDE COMING

Independent Practitioners

Special Markets (National/Large

Group Accounts)

Growing Share in Companion Animal Market

25% of U.S. companion animal market

Specialties (Emergency/Hospital)

38

68% U.S. households

that own a pet,

compared to

56% in 1988

(APPA)

Companion Animal Growth Drivers

$59B Estimated

expenditures by

pet owners in 2014,

up from $41B

in 2007

(APPA) 39

Key Strategic Partnerships

40

Mixed Practices: Our Enhanced Ability to Cross Serve

Patterson Animal Health – a single source for all animal needs, from pharmaceuticals to equipment

41

Technical Service: A Powerful Differentiator

• Complete service offering — installation, training & service

• Preventative maintenance programs generate recurring revenue

42

Synergies

Overview

SYNERGY REALIZATION

• Executed on 100-day projections

• Early savings capture through headcount reductions & implementation of cross selling functionality

• Devens office consolidation occurring

COMPANION ANIMAL CONSOLIDATION

• Distribution center consolidation plans under way

• Territory managers being trained on legacy systems & new products

• Introducing Animal Health International private-label portfolio

SALES & MARKETING

• At close, both sales & management team structure aligned, eliminating redundancies

• Cross selling implemented

43

Growth Our Focus for Growth

• Increase market penetration • Increase market share • Promote technology & service offerings • Grow private-label, proprietary product lines • Continue domestic/international acquisition strategy

44

POSITIONED

Delivering Results

FOR GROWTH

Questions?

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