Slide 1: Q1 2017 Sales
Q1 2017 SALES April 20, 2017 Cécile Cabanis, CFO
Slide 2: Disclaimer
DISCLAIMER This document is presented by Danone. It contains certain forward- Subject to regulatory requirements, Danone does not undertake to looking statements concerning Danone. In some cases, you can publicly update or revise any of these forward-looking statements. identify these forward-lookin
Slide 3: Strengthen Danone growth model in a more complex consumption environment
Strengthen Danone growth model in a more complex consumption environment 2017 recurring An increasingly volatile context Danone + WhiteWave EPS growth From To + Recurring EPS >5%(1) Double-digit recurring EPS growth(2) (1) Like-for-like (2) At constant exchange rate > Continued transition in China >
Slide 4: Q1 2017 Like-for-like sales growth of +0.7%
Q1 2017 Like-for-like sales growth of + 0.7% Reported +3.0% Like-for-like +0.7% €5,464 mln €5,306 mln +2.8% (0.5)% (2.6)% +3.3% 3.5% (3.4)% Currency Scope & others Volume Value Q1 2016 Q1 2017 +3.0% reported sales growth I4I
Slide 5: Q1 2017 Regional dynamics
Q1 2017 Regional dynamics(1) EUROPE NORAM / CIS ALMA USA+Canada+CIS AsiapacLatamMiddleEastAfrica - 1.9% - 0.1% + 3.7% €2.0 bn €1.2 bn €2.2 bn > Slower Dairy sales > Category slowdown & short-term > Tougher market consumption > On-going transition of the indirect price pressure in Dairy NORAM context
Slide 6: Q1 2017 Category dynamics
Q1 2017 Category dynamics(1) -2.3% +1.7% +4.1% +8.8% 4.0% 4.0% 4.8% 3.0% 3.0% Price/mix 0.1% Volume (1.3)% (5.3)% (1) Like-for-like sales growth I6I
Slide 7: Manage contrasted regional dynamics of growth; continue to progress on profitability agenda
Manage contrasted regional dynamics of growth Continue to progress on the profitability agenda Adapt plans > Regain Activia’s consumers > Accelerate local brands Build the platform > Invest behind the category for sustainable growth > Launch innovations and reinforce Market share: solid activation p
Slide 8: Strengthen a solid growth agenda & protect Mizone market share
Strengthen a solid growth agenda & protect Mizone market share 22 24 24 12 Competitor 1 10 Competitor 2 Strengthen a solid growth agenda > Continuously gaining market share & strengthen Leadership 2014 2015 2016 > Leading position in aquadrinks Double-Digit growth (2) Double-Digit growth (2) (Sirma)
Slide 9: Continue to leverage new growth opportunities in China
Continue to leverage new growth opportunities Progress in the conversion towards a sustainable direct model in China > Develop a strong Tailored Nutrition portfolio ≈10% of ELN sales Continue to leverage new growth opportunities > Grow new markets > + 15 %(1) #1 Organic Brand (excl. Walmart) #1 Bran
Slide 10: Sustain a strong and resilient model of growth
Sustain a strong and resilient model of growth > EUROPE #1 Strong balanced growth Solid growth across regions > ALMA #1 Double-Digit growth Neocate > Paediatric care ≈ > 10% (1) Strong drivers of growth Nutrison > Adult tube ≈ +15% (1) (1) Q1 like-for-like sales growth I 10 I
Slide 11: Danone enters a new phase with the successful closing of WhiteWave
Danone enters into a new phase of its transformation with the successful closing of WhiteWave 2016 + A perfect combination to Strong value creation strengthen Danone 2020 plan accretive to Danone model > A perfect match of vision, culture and businesses > Accelerates Danone journey towards its 2020
Slide 12: Organization in place from Day 1
Organization in place from Day 1 Operations Management organization Combining Dairy Noram with WhiteWave Noram Alpro will join forces with Danone Dairy > Leverage scale and deliver growth opportunities > Keep EU momentum from long lasting trends > Expand and grow the plant-based category > Set the U
Slide 13: A dedicated Integration team to maximize synergies delivery
A dedicated Integration team to maximize synergies delivery Integration team US and EU integration teams in place since July 2016 > Focus on delivering synergies from day 1 > Preserve WhiteWave & Alpro entrepreneurial spirit and innovation capacity I 13 I
Slide 14: Key mid-term value creation metrics confirmed
Key mid-term value creation metrics confirmed From solid to strong 2017 recurring EPS accretion Confirming mid-term metrics Enhancing 2017 recurring EPS accretion Synergies $ 300m From To Like-for-like Extra +0.5% to +1% sales growth solid STRONG Recurring operating Accretive from 2018 Margin Solid
Slide 15: Significant & highly executable synergies
Significant & Highly executable synergies $ 300m > Central team costs > G&A costs: HR, Finance, IT… > NORAM ≈ 85% > Commercial costs: sales & marketing … > Europe ≈ 15% > Operation costs: logistics, manufacturing, overheads, procurement… H2 2017 2018 2019 2020 Topline synergies Cost synergies I 15 I
Slide 16: Danone's new categories and regional breakdown
Danone’s new categories and regional breakdown Danone categories Danone regions DanoneWave: Dairy Noram + WhiteWave Noram EUROPE NORAM Europe + USA + Canada Fresh Dairy Products: incl. WhiteWave ROW Waters ALMA CIS Rest of the world ELN - Medical I 16 I
Slide 17: Strengthening the model before accelerating towards 2020 ambition
Strengthening the model before accelerating towards 2020 ambition 2015 2016 2017 … > Moderate LfL Sales Growth > Sustained Recurring Operating Margin Improvement (LfL basis) FROM Like-for-like recurring EPS growth > 5% GROWTH PROFIT AGILITY CONSISTENCY LfL = Like-for-like (definition on slide 22) I
Slide 18: Upgraded 2017 guidance: double-digit recurring EPS growth
Upgraded 2017 guidance: double-digit recurring EPS growth 2015 2016 2017 … + > Moderate “LfL New Danone ” Sales Growth > Sustained Recurring Operating Margin Improvement (“LfL New Danone” basis) TO Double-digit recurring EPS growth at constant exchange rate GROWTH PROFIT AGILITY CONSISTENCY “LfL New
Slide 19: Appendix
APPENDIX
Slide 20: Q1 2017 impact of currencies & scope
Q1 2017 impact of currencies & scope Q1 2017 Fresh Dairy Products Waters Early Life Nutrition Medical Nutrition Total Reported sales growth +2.4% +0.4% +4.8% +7.8% +3.0% Currency +5.4% (1.2)% +1.6% (0.6)% +2.8% Scope of consolidation (0.7)% (0.1)% (0.9)% (0.4)% (0.5)% Like-for-like sales growth (2.3
Slide 21: Changes in exchange rates
Changes in exchange rates % total Q1 17 sales Q1 17 vs Q1 16 (avg) United States Dollar 12.6% 4.3% Russian Ruble 8.0% 31.8% Indonesian Rupiah 6.3% 5.7% Chinese Renminbi 6.2% -1.1% British Pound 5.1% -10.0% Argentine Peso 5.0% -4.5% Mexican Peso 4.5% -8.0% Brazilian Real 4.1% 28.7% Moroccan Dirham 2.
Slide 22: Financial indicators not defined in IFRS
Financial indicators not defined in IFRS Additional indicator of like-for-like changes: “like-for-like New Danone” changes Since completion of the acquisition, WhiteWave and Danone’s activities have been combined and are generating synergies. Separate reporting of WhiteWave and Danone in their pre-a
Slide 23: Financial indicators not defined in IFRS
Financial indicators not defined in IFRS “Like-for-like New Danone” changes (or “Like-for-like including WhiteWave starting April 2017” changes) in sales, recurring operating income and recurring operating margin reflect the organic performance of Danone and WhiteWave combined. This indicator corres
Slide 24: Financial indicators not defined in IFRS
Financial indicators not defined in IFRS Recurring operating margin is defined as Recurring operating income over Sales ratio. Non-recurring results from associates include significant items that, because of their exceptional nature, cannot be viewed as inherent to the recurring activity of those co