Capturing The Plant Based Opportunity

BARCLAYS CONFERENCECapturing theplant based opportunitySeptember 4, 2019Emmanuel FaberChairman and CEOI 1 I

In the age of flexitarianism and the rise of plant based foodA unique visionI 2 I

In the age of flexitarianism and the rise of plant based foodA unique businessHealth-focusedportfolioFlexitariandiets promotionSustainablefarming ipof volumes soldrecommended fordaily consumptionin fresh dairy andplant-basedin organicnetworks for speed,impact and scaleSource: Euromonitor, internal estimates. (1) 89% in 2018. Refers to water, yogurt and other daily dairy products, baby milks & foods, milks and milk powders,beverages with 0% sugar and medical nutrition. Based on official public health recommendation, these categories are generally suitable for daily consumption.I 3 I

A unique, integrated modelI 4 I

The opportunity:the ageof flexitarianismDanone uniquelypositioned for theplant-basedmomentumI 5 I

The urgency for sustainable food systems and dietsFood at the heart of many of today’s world challenges 1 spent on foodtoday 1 hidden costincurred for society50%consumption 1Source : Sustainable Food Trust, « The Hidden Cost of UK Food », November 2017Productionrelated illhealth: 13%Diet-relateddisease: 37%50%productionNatural capitaldegradation: 26%Biodiversityloss: 11%Importedfood: 8%Farm support andregulation: 5%I 6 I

A shift in eating habits and production practices is neededGrowing science evidenceOct-2018Jan-2019Apr-2019Aug-2019I 7 I

Towards protein-autonomous EuropeOne Planet. One Health at work at the macro levelFood forEuropeans(in % calories)ExportExportFood forEuropeans(in % calories)ExportCereals and starchy foodsFruit and vegetable-40%GHGsExportProtein crops (peas, Lentils, ect.)VolumeQualityMeat, eggs and fishDairy productsGHGsOthers2010Crop production-30%Livestock ecologicalagricultureIntensive agriculture-90%Nitrogen lossesImport Nitrogen fertilisersAnimal feedImportxNo chemicalfertilizerxNo vegetal protein/animal feed importSource : Adapted from IDRRI, « An agroecological Europe in 2050: multifunctional agriculture for healthy eating”, Sept-2018I 8 I

Consumers rethinking protein dietOne Planet. One Health at work in my platePersonal statements about meat, seafood, poultry and meat alternatives (2018)6060575652% agree50474642434137403020100« I make a point of regularly having meatfree days (eg meat-free Mondays) »« I am limiting or avoiding redmeat for environmental reasons »Source: Lightspeed/Mintel. Limiting/avoiding red meat: Internet users ages 16 1,000 per country. Meat-free days: Internet users aged 16 who have bought meat, seafood, poultry andmeat alternatives in the last 3 months – France (959), Germany (915), Italy (973), Poland (963), Spain (973)I 9 I

Consumers rethinking protein dietThe role of food in climate changeProportion of total greenhouse gas emissions from foodA quarter of globalEmissions come fromfoodFood26%Other greenhouse gasemissions 74%More than half of foodEmissions come fromanimal productsAnimal products58%Half of all farmedanimal emissionscome from beefand lambBeef & lamb50%Other food42%Other animalproduct50%Source: Poore & Nemecek (2018), ScienceI 10 I

Consumers rethinking protein dietThe highest-impact plant-based protein emits less than the lowest-impact animal proteinKilograms of greenhouse gas emissions per servingLow ImpactBeefLambFarmed prawnsChocolateFarmed fishPorkChickenCheeseBeerDairy milkEggsCoffeeTofuBeansNutsAverageHigh ImpactA chocolate bar fromthe deforestedrainforest emits morethan a serving oflow-impact beefA portion of the highest-impactvegetable proteins emits less thanthe lowest-impact animal proteins051015 kgSource: BBC adapted from Poore & Nemecek (2018), ScienceI 11 I

Dairy is critical for planetary dietsDairy protein: environmental impact 5x lower than beef meatCarbon footprint per 100g protein(kg CO2eq)Soy drinkLand use per 100g protein(m²/year)4Milk10Beef(beef herd)501027MilkBeef(beef herd)03Soy drink2030405060164020406080100120 140160 180Source: Adapted from Poore & Nemecek (2018), ScienceI 12 I

Dairy is critical for planetary dietsCritical role in flexitarian diet and soil health as meat consumption reduces Value-added dairy diet fundamental tobalance meat reduction in futureagricultural models Grazing essential to soil health andbiodiversity High quality, highly digestible proteins Dairy, especially yoghourt, consideredas protective foodMethane output(g/d)Milk C18 (% of total FA)Source: Journal of Dairy Science, Vol 92, N 10, 2009 Fermented dairy recommended inplanetary dietsSource: Mozaffarian, Circulation 2016I 13 I

Consumer rethinking protein dietShift to flexitarian diets across generationsOne in five UK adults say they are following flexitarian dietsFlexitarian / meat reduction%5Vegetarian10Vegan152018-24 year olds25-34 year olds35-44 year olds45-54 year olds55 year oldsSource: Waitrose food and drink report 2018-19I 14 I

Consumers rethinking protein dietScience foundations for plant-based as a healthy diet optionHealthy balance of nutrientsEffect in Type-2 Diabetes prevalence Low in saturated fat High in fibreT2D prevalence (%) High in unsaturated fat87.66.1644.83.22.920 Rich in vitamins and minerals Nutrient densitySource : Adventist Healthy Study-2I 15 I

Soy proteinAmong the highest nutritional valuesProtein scores (PDCAAS)Egg white1.00Milk (casein)1.00(ISP) Soy1.000.92Beef0.68Kidney beansRolled oatsRice Source of high quality protein0.73Pea proteinPinto beans Scores better than any other proteins of plant origin Low in saturated fat0.630.57 Low in sugars0.53Source: J Agric Food Chem 59:12707-12, 2011I 16 I

Soy proteinRecognized health benefits Cholesterol-lowering potential Beneficial for cardiovascular health Lower risk of breast and prostate cancer Anti-inflammatory muscle impactSource: “Soy and Health Update: Evaluation of the Clinical and Epidemiologic Litterature“, 24 November 2016; “No Difference Between the Effects of Supplementing With Soy Protein Versus Animal Protein onGains in Muscle Mass and Strength in Response to Resistance Exercise” (2018); World Cancer Research Fund, “Diet, Nutrition, Physical Activity and Cancer: a Global Perspective” (2018).I 17 I

Flexitarian diets becoming a prominent feature of mainstream food cultureLarge growth opportunities aheadCAGR2018-2023 (%)Market size ( bn)2018 0bn2023 15bn 25bnTotal plant-based 9%Plant-based milkalternative 9%Plant-based yogurtalternative 20%Plant-based ice creamalternative 17%Source: Euromonitor, World excl. China; Total plant-based defined as of Free from Dairy, Ice Cream, Milk, Yogurt and MeatI 18 I

Complementary plant-based and dairy proteins categoriesBringing incremental value for dairy category and retailersShopperNOT BUYINGplant baseddairy categorydairy categoryShopperBUYINGplant based 2.28 3.11per tripper trip31.2 39.4 per tripper tripVALUEOF DAIRYBASKET 36%VALUEOF DAIRYSPENTIncreasethe averagespending perbasket inDairy & Plantcategory 26%Source: Shopper Basket analysis in EUI 19 I

Complementary plant-based and dairy proteins categoriesBringing incremental value for dairy category and retailersgrocerygrocery 40.5 70.6per tripper trip17.1 40.4 per tripper tripVALUEOF GROCERYSPENT 74%VALUEOF GROCERYSPENTIncreasethe averagespending perbasket inGroceryX2.4Source: Shopper Basket analysis in EUI 20 I

High retailers acceptance and healthy shelf space growth drives plant-based growthAlpro contributes to half of category growth in FranceIncreasing offer as retailers bet on the categoryAverage # of Plant-Based SKU/ PoS1824213329Shelf space booming driving consumer awarenessAverage Plant-Based shelf space (m) / PoS366.74.24.44.6CAGR 2016-19 14%2812201416142015CAGR 2016-19 18%4.94.119201720185.431CAGR 2017-19 28%20167.520192.12.2201420152.62.9CAGR 2017-19 30%2016201720182019Source: IRI France, 08-2019, Hyper and SupermarketsI 21 I

The opportunity:the ageof flexitarianismDanone uniquelypositioned for theplant-basedmomentumI 22 I

Driving plant-based growthObjective: triple sales by 2025 5bn3X 1.7bn20182025I 23 I

A pioneer and leader in plant-basedFollowing Whitewave acquisition in 2016Source: Euromonitor, internal estimatesI 24 I

Unparalleled scale, footprint and relative exposure2018 estimated revenuesPure plant-based players( m plant-based sales)FMCG companies(% of sales from plant-based) ondMeatNestleSource: Based on internal estimates and Euromonitor, retail value for FY2018, plant-based defined as of Free from Dairy, Ice Cream, Milk, Yogurt and MeatI 25 I

A pioneer and leader in plant-basedLeadership positions across categories and segmentsPB Yogurt AlternativesPB Milk AlternativesSoyAlmondOatTotalUSAEurope ugalSwedenMarketshare 60%40%-60%20%-40%0%-20%Source: Nielsen, MAT TY to Q1 2019, internal estimatesI 26 I

Superior offer, expertise and heritageDriving product distinctiveness through technical superiorityOrganoleptic liking score7.4AlproCompetitor 15.97.0SilkCompetitor 14.7Source: Internal consumer blind test – Alpro EU 4 (Haystack), Silk US 2018I 27 I

Superior offer, expertise and heritageEnd-to-end processReturn on investment across the value chainFarmingraw materialingredientsProcessingraw materialsBaseproductsRecipeformulationFilling &packagingI 28 I

Superior offer, expertise and heritageA unique expertise: greatest research across spectrum of sources of proteinMixing right blends for best productsHighest nutritional qualityBest degree of functionalityBest tastingLowest costVarieties and originsI 29 I

Superior offer, expertise and heritageMastering a multi-ingredient playgroundMatureGrowingBoomingEmergingEarly MEHEMPI 30 I

New category fundamentalsCreating new opportunitiesPlant-basedPlant-based beverages andyogurts growing 8%ProbioticsProteinsProbiotic beveragesand yogurts growingHigh proteinyogurt growing 6% 10%Source: Euromonitor value CAGR 2015-2017 total world. Plant-based excluding ChinaI 31 I

Investing for the next plant-based frontiersThrough partnerships and start-up portfolioR&I partnershipsCreating complete food proteinfrom new fermentationFermented plantproteinstechnology inspired byYellowstone ecosystemChickpea proteiningredient start-upI 32 I

Native plant-based brand equityEntitled to travel and expand into adjacent categoriesCore businessAdjacent categoriesIce-CreamBeveragesYogurtCoffee inspiredCulinaryPlant-based nutritionRecruitment leversI 33 I

Target new categoriesSeizing plant-based coffee-inspired opportunitySizeable ready-to-drinkcoffee category 20bnworldwideRolling out ready-to-drinkcoffee in 2019Capturing growthin coffee shopsAlpro out of home plant-basedbarista 40% CAGR in 2016-18Source : Euromonitor, internal estimatesI 34 I

Fostering out-of-home coffee mega opportunityDrive in-store conversion with consumer proximityDrive awareness that’s it’s AlproI 35 I

Pivoting acquired brands positioningNew brand visualI 36 I

Pivoting acquired brands positioningNew brand visualI 37 I

Pivoting acquired brands positioningNew brand visualI 38 I

Pivoting acquired brands positioningMoving brands into the One Planet. One Health frame of visionSustainableCoconut CenterIndustry pioneerPollinatorUSA SegregatedConservationPalm Oil by 2020ProgramI 39 I

Pivoting brands into plant-basedLeveraging health heritageCoffeeIndulgenceKidsProbioticsI 40 I

Growing food allergy prevalenceOpening growth avenue for plant-based baby foodFood allergy as a global epidemyMilk ranking among top 3 allergensRanking of products associated toallergy avoidance in ChinaDanone is #1in soy-based IMFPlant-based as the first choiceFood allergy prevalence rates 20% 10% 20% 10%15%5%Self-reportedSource : Tang & Mullins, 2017Symptomatic1Source: Toluna quick survey23456789Source : Nielsen excluding USI 41 I

Unique market reachTailored geographical ngPlant-basedBecoming main-streamPlant-basedcatching upPush plant-basedcategory developmentCategory rapidly evolvingMaintain leadershipand market shareCapture market shareand leadership positionReestablish plant-basedand grow market shareEstablish brand asmarket innovatorI 42 I