Slide 1: Q3 2014 Results
Q3 2014 Results October 15, 2014 1
Slide 2: Disclaimer
DISCLAIMER This document contains certain forward-looking statements concerning Danone. Although Danone believes its expectations are based on reasonable assumptions, these forward-looking statements are subject to numerous risks and uncertainties, which could cause actual results to differ material
Slide 3: Q3 2014 - Sales Growth Analysis
Q3 2014 - SALES GROWTH ANALYSIS +6.9% Like-for-like +3.0% Reported 7.0% (3.7)% (0.2)% (0.1)% €5,416 mln €5,259 mln Q3 2013 Currency Scope & others Volume Value Q3 2014 3
Slide 4: 9M 2014 - Sales Growth Analysis
9M 2014 - SALES GROWTH ANALYSIS (2.7)% +3.8% Reported Like-for-like (6.8)% €16,317 mln 5.8% 0.3% €15,883 mln (2.0)% 9M 2013 Currency Scope & others Volume Value 9M 2014 4
Slide 5: Total Group – Solid Underlyings on Low Comps
TOTAL GROUP – SOLID UNDERLYINGS ON LOW COMPS Like-for-like sales growth 6.9% 6.5% 5.6% 5.5% 4.2% 3.8% 2.9% 2.2% 2.3% 9M 13 9M 14 Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Solid performance in all markets despite tougher consumption trends Reverse effect of the Fonterra false alert Good progress agai
Slide 6: Geographical Dynamics
GEOGRAPHICAL DYNAMICS Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 9M 13 9M 14 2.8% 1.1% 0.5% 0.1% EUROPE (0.9)% (0.4)% (3.0)% (3.0)% (5.1)% 10.2% 11.1% 10.2% 9.9% 8.5% 7.8% 7.0% 6.0% CIS & NORAM CIS+USA+Canada 3.3% 9M 13 9M 14 Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 16.6% 15.3% 16.1% 13.5% 13.2% 12.
Slide 7: Sales performance by Division
Sales performance by Division 7 7
Slide 8: Fresh Dairy Products – Focusing on Key Battles
FRESH DAIRY PRODUCTS – FOCUSING ON KEY BATTLES Like-for-like sales growth Price/mix Volume 4.9% 9.8% 8.5% 2.6% 4.6% 7.6% 2.6% 0.7% 7.8% 0.7% 0.5% 2.9% 3.9% 2.4% 2.3% 4.1% 0.2% 3.6% 0.7% 1.9% 1.7% 0.8% (1.0)% (3.7)% (6.2)% (7.4)% (7.1)% 9M 13 9M 14 Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Price/volu
Slide 9: Fresh Dairy Products – Shaping Europe for Profitable Growth
FRESH DAIRY PRODUCTS – SHAPING EUROPE FOR PROFITABLE GROWTH BREAKDOWN VOLUME/VALUE GROWTH (%) Q1 2013 Q2 2013 Q3 2013 Q4 2013 Q1 2014 Q2 2014 Q3 2014 6% 2% Actimel: positive Q3 performance (2%) in UK and Germany (6%) (10%) Price/mix (14%) Volume VALUE MARKET SHARE EVOLUTION PROFITABLE REVENUE GROWTH
Slide 10: Fresh Dairy Products USA – Leading Category Through Greek & Innovation
FRESH DAIRY PRODUCTS USA – LEADING CATEGORY THROUGH GREEK & INNOVATION LEADING THE YOGURT CATEGORY DANNON’S FUTURE GROWTH PILLARS 40% Average value market shares Consumers Danone(1) 30% Competitor 1 20% Competitor 2 10% 2011 2012 2013 YTD 2014 (September) Retailers (1) Danone : including Stonyfield
Slide 11: Fresh Dairy Products CIS – Keep Building a Strong Local Model
FRESH DAIRY PRODUCTS CIS – KEEP BUILDING A STRONG LOCAL MODEL Q3 RUSSIAN SALES BREAKDOWN Modern Dairy and CIS PERFORMANCE High Margin Tradi Stable volume dynamics Price/mix Volume Fermented & Milk Volume down double-digit Q3 BRANDS VOLUME GROWTH >15% Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 >10% >5
Slide 12: Fresh Dairy Products - Selected Innovations Q3
FRESH DAIRY PRODUCTS - SELECTED INNOVATIONS Q3 YoCrunch Greek with Yogurt Frappuccino Light & Fit Protein Shake Kellogg’s flakes at Starbucks Danette USA USA Worldwide Canada Activia Fruit Fusion Danone DanFrut Danio minis Europe Mexico France 12
Slide 13: Waters – Healthy Sustained Growth
WATERS – HEALTHY SUSTAINED GROWTH Like-for-like sales growth Price/mix 16.9% Volume 13.1% 12.1% 7.5% 11.8% 11.4% 10.5% 8.9% 6.1% 3.5% 5.0% 4.4% 8.6% 3.4% 8.1% 2.1% 3.5% 4.0% 9.4% 8.3% 7.1% 7.0% 7.1% 7.0% 6.0% 5.4% 4.6% 9M 13 9M 14 Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Solid volume growth in all
Slide 14: Waters - Selected Innovations Q3
WATERS - SELECTED INNOVATIONS Q3 Gotta by Bonafont Akmina Limongiller New identity for Volvic Mexico Turkey Worldwide Bonafont mineralizada Mizone Isotonic Żywiec Zdrój new format Mexico Indonesia Poland 14
Slide 15: Early Life Nutrition – Back to Growth
EARLY LIFE NUTRITION – BACK TO GROWTH 19.2% Like-for-like sales growth 17.1% 13.5% 9.3% 9.3% 10.8% 7.3% 9.9% 6.2% 7.8% 2.7% 1.1% 0.9% (1.4)% (0.5)% (4.8)% (5.9)% (7.3)% (7.9)% 9M 13 9M 14 (1.0)% (2.9)% (1.3)% (6.9)% (7.7)% (1.3)% (8.6)% (9.2)% Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Asian markets
Slide 16: Early Life Nutrition China – Building a Stronger Platform
EARLY LIFE NUTRITION CHINA – BUILDING A STRONGER PLATFORM GLOBAL SALES VALUE PER CHANNEL SUSTAINABILITY ENABLERS M.RMB 3,500 3,000 Build category recognition 2,500 2,000 Master geographies and channels 1,500 Be the closest to mums 1,000 500 Efficient investment model to secure profitability - Secure
Slide 17: Early Life Nutrition - Selected Innovations Q3
EARLY LIFE NUTRITION - SELECTED INNOVATIONS Q3 Nutrilon Cereals Dumex Advance Nutri™ Milupa Pouches Russia Thailand Switzerland Vital Precinutri Olvarit Friends Pouches Argentina The Netherlands 17
Slide 18: Medical Nutrition – Confirmed Trends
MEDICAL NUTRITION – CONFIRMED TRENDS Like-for-like sales growth Price/mix Volume 10.1% 7.6% 7.3% 6.3% 4.5% 5.6% 0.1% 6.4% 1.1% 2.2% 5.8% 1.6% 5.2% 4.7% 0.9% 1.1% 7.4% 5.7% 5.4% 6.2% 6.2% 5.6% 4.8% 4.3% 3.6% (0.1)% (1.6)% 9M 13 9M 14 Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Strong performance in Eur
Slide 19: Medical Nutrition - Selected Innovations Q3
MEDICAL NUTRITION - SELECTED INNOVATIONS Q3 KetoCal Neocate MCT Drug resistant epilepsy Upgraded formulation Fortimel Compact Energy Turkey Brazil New recipe & improved texture 10 countries incl. Germany, Italy and France 19
Slide 20: 2014 Outlook
2014 OUTLOOK 2014 OUTLOOK 20
Slide 21: H2 2014 Agenda - Deliver on 2014 Key Priorities
H2 2014 AGENDA - DELIVER ON 2014 KEY PRIORITIES TURNING AROUND EUROPE GROW AND NAVIGATE IN ALMA 2013 2014 Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Q4 14 +12.7% Q3 LFL sales growth excluding 8 recall markets Fresh Dairy Products sales growth trend evolution KEEP WINNING CIS & NORAM TURN ELN ENGINE B
Slide 22: 2014 Guidance
2014 GUIDANCE (1,027) 2014 objectives Sales growth(1) +4.5% to +5.5% (1) Stable Trading operating margin ± 20 bps Free cash-flow excluding around €1.5 bn exceptional items(2) (1) Like-for-like : Based on constant scope of consolidation, constant exchange rates and accounting principles (2) Free cash
Slide 23: H2 in Line with Our Agenda of…
H2 IN LINE WITH OUR AGENDA OF... ©) DANONE STRONG PROFITABLE SUSTAINABLE GROWTH
Slide 24: Appendix
APPENDIX APPENDIX 24
Slide 25: Q3 2014 - Impact of Currencies and Scope
Q3 2014 - IMPACT OF CURRENCIES AND SCOPE Fresh Dairy Early Life Medical Waters Total Products Nutrition Nutrition Reported sales growth (4.0)% +7.4% +17.3% +10.0% +3.0% Currency (4.8)% (4.0)% (1.6)% (0.1)% (3.7)% Scope of consolidation +0.1% (0.4)% (0.3)% (0.0)% (0.2)% Like-for-like sales growth +0.
Slide 26: 9M 2014 - Impact of Currencies and Scope
9M 2014 - IMPACT OF CURRENCIES AND SCOPE Fresh Dairy Early Life Medical Waters Total Products Nutrition Nutrition Reported sales growth (5.6)% +5.3% (4.6)% +5.4% (2.7)% Currency (7.8)% (7.2)% (5.1)% (2.5)% (6.8)% Scope of consolidation (0.1)% +1.1% +1.0% +0.3% +0.3% Like-for-like sales growth +2.3%
Slide 27: Q3 2014 - Sales by Business & Geographical Area
Q3 2014 - SALES BY BUSINESS & GEOGRAPHICAL AREA Like-for-like Q3 2013 Q3 2014 € mln sales growth Fresh Dairy Products 2,913 2,796 +0.7% Waters 1,089 1,169 +11.8% Early Life Nutrition 924 1,084 +19.2% Medical Nutrition 333 366 +10.1% Europe 2,068 2,156 +2.8% CIS+Noram 1,183 1,153 +3.3% ALMA 2,008 2,1
Slide 28: 9M 2014 - Sales by Business & Geographical Area
9M 2014 - SALES BY BUSINESS & GEOGRAPHICAL AREA Like-for-like sales growth Like-for-like 9M 2013 9M 2014 € mln sales growth Fresh Dairy Products 8,936 8,436 +2.3% Waters 3,080 3,243 +11.4% Early Life Nutrition 3,307 3,155 (0.5)% Medical Nutrition 994 1,048 +7.6% Europe 6,228 6,417 +1.1% CIS+Noram 3,
Slide 29: Q3 2014 Like-for-Like Sales Growth Breakdown volume/value
Q3 2014 LIKE-FOR-LIKE SALES GROWTH Breakdown volume/value Volume Price/mix Total Like-for-like Fresh Dairy Products (7.1)% +7.8% +0.7% Waters +8.3% +3.5% +11.8% Early Life Nutrition +9.9% +9.3% +19.2% Medical Nutrition +5.6% +4.5% +10.1% Europe (0.9)% +3.7% +2.8% CIS+Noram (6.9)% +10.2% +3.3% ALMA +
Slide 30: 9M 2014 Like-for-Like Sales Growth Breakdown volume/value
9M 2014 LIKE-FOR-LIKE SALES GROWTH Breakdown volume/value Volume Price/mix Total Like-for-like Fresh Dairy Products (6.2)% +8.5% +2.3% Waters +7.0% +4.4% +11.4% Early Life Nutrition (1.4)% +0.9% (0.5)% Medical Nutrition +5.4% +2.2% +7.6% Europe (1.2)% +2.3% +1.1% CIS+Noram (6.5)% +12.5% +6.0% ALMA (
Slide 31: Changes in Exchange Rates
CHANGES IN EXCHANGE RATES 28.6% of 9M sales denominated in € % total 9M 14 9M 14 vs 9M Q3 14 vs Q3 sales 13 (avg) 13 (avg) US dollar 10.1% (2.8)% (0.0)% Russian ruble 9.8% (13.3)% (9.6)% Chinese yuan 6.9% (2.8)% (0.7)% British pound 5.3% 4.9% 7.6% Indonesian rupiah 5.3% (16.7)% (9.2)% Mexican peso 5
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