Emmanuel Faber. Deutsche Bank Global Consumer Conference Paris - June 20th, 2012

Transcription

1 Emmanuel Faber Deutsche Bank Global Consumer Conference Paris - June 20th, 2012

2 2 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 materially from those anticipated in these forward-looking statements. For a detailed description of these risks and uncertainties, please refer to the section Risk Factors in DANONE s Annual Report (which is available on DANONE undertakes no obligation to publicly update or revise any of these forward-looking statements. This document does not constitute an offer to sell, or a solicitation of an offer to buy, Danone shares.

3 Unique Mission, Unique Portfolio FRESH DAIRY PRODUCTS Developing a well being category worldwide WATERS Hydratation and elimination Bring health through food to the largest number of people BABY NUTRITION Supporting growing children Every step of the way MEDICAL NUTRITION Nutritional support for persons in fragile health 3 3

4 4 A Fast Geographical Transformation Sales by region Western Europe 78% 4 Emerging Markets 16% 6% North America Japan + NZ Western Europe 51% 2% Japan + NZ Emerging Markets 38% 9% North America Japan + NZ Western Europe 2% 38% 9% North America 4 Emerging Markets 51%

5 Well-positioned in fastest-growing food categories Faster growing food categories 5-year industry volume CAGR as of 2010 Growth focused portfolio Medical* Waters 6,5% 8,8% FY 2011 Sales breakdown 2011 like-for-like sales growth 2011 trading operating margin Baby Food 5,2% 6% Medical Nutrition +9.4% 19.98% Yoghurt 4,9% Frozen Processed Food 2,8% 19% Baby Nutrition +10.7% 19.28% Sauces, Dressings and Condiments 2,7% Pasta Ice Cream 2,1% 2,1% 17% Waters +15.7% 13.13% Chilled Processed Food 2,1% Confectionery 1,8% Spreads Bakery 1,5% 1,2% 58% Fresh Dairy Products +4.6% 13.13% Soup 0,8% * As of 2009 for medical nutrition Source: Euromonitor & internal sources 5 5

6 6 Managing a complex environment since 2008

7 7 A Complex Environment 25 Unemployment rate Commodities (GSCI Index) Spain USA Brazil BRIC EuroZone Source : Euromonitor Source : The economist Source : Bloomberg Consumption under pressure in mature markets Developing middle class in emerging markets Input costs volatility

8 8 Complex Equation Clear Priorities INFLATION SPGSCI Index +10% per year between 2010 and D-09 D-10 D-11 EUROPE Sluggish growth Competitive price management EMERGING Categories development Positive mix Operational leverage

9 9 Countering inflation with Productivity and Mix more than Pricing Inflationary raw material environment Boosted Productivity ( mln) Limited inflation transfer to the consumer GSCI Index Danone productivity ( mln) >10% Jan-04 Jan-06 Jan-08 Jan-10 Jan-12 Source : Bloomberg Average Dairy price index kept at 120 2% 2 years Inflation 2 years price/mix average (CAGR)

10 : Sales growth, Margin, FCF Like-for-like sales growth 8,4% 6,9% 7,8% 3,2% Trading Operating Margin and like-for-like growth Free cash flow ( mln) +53bps +61bps +3bps +20bps +9.4% CAGR +17% 14,91% 15,31% 15,16% 14,72%

11 11 Geographical Equation Like-for-like Trading Operating margin evolution bps +26bps +109bps Europe Asie ROW Like-for-like sales growth - CAGR 2008/ ,5% 12,6% 4,2% Europe Asia ROW

12 12 Managing 2012

13 Var of consumption 13 Southern Europe deteriorating Focus on Spain Unemployment rate in Spain Unemployment vs Consumption Variance by region 5% 0% Asturies -5% -10% -15% -20% -25% Pais Vasco Navarre Rioja Galice Extremadura Manche Castille Cantabria Espagne Aragon Madrid Andalousie Castilla y Leon Communidad Valenciana Baléares Murcia Canaries Increase of unemployment rate

14 Dairy Spain : Dominant brand in a changing environment Food Retail Value Market shares Fresh Dairy Products Value Market shares Retailer #1 Retailer #2 Retailer #3 DANONE Other Brands Private Label 24,6 25,5 26,8 28,0 53,6 51,2 17,3 17,2 17,3 17,7 36,2 38,4 10,9 10,3 10,4 10,5 10,3 10, YTD YTD 2012 Source : IRI 14

15 15 Dairy Spain requiring specific response Support and differentiate Increase competitiveness Innovate Continued productivity

16 Parameters evolving Managing with same Priorities H1 inflation above expectations higher productivities INFLATION EUROPE EMERGING Deterioration in Southern Europe Continued strong growth & operational leverage Specific Support & Adjustments No compromise vs LT building Investment maintained

17 Continued performance in Emerging markets 2011 sales breakdown Western Europe 38% 2% Japan 9% + NZ North America Like-for-like sales growth 17 Emerging countries 51% Platform(s) for growth Dairy - CIS Aquadrinks Asia Dairy Americas & AME Baby Nutrition Asia & AME Medical Nutrition China / Turkey / Brazil FY 11 Q ,1% 19,4% Aquadrinks LATAM 13,3% 12,7% 2,4% 0,9% Europe Asia ROW 17

18 18 Fresh Dairy CIS - From Integration to Growth 2012 agenda: Activating the key brands Danone-Unimilk CIS % volume growth A rolling activation plan e.g. : key activities Q1 Q1 11 Q2 11 Q3 11 Q4 11 Q support on Prostokvashino 360 support on Danonino Good consumer receptiveness, with Prostokvashino the main growth driver Support & line extension on Danissimo 14% +12% Q1 12 like-for-like growth - Russia

19 19 Leveraging the Prostokvashino brand New identity in 2012

20 Fresh Dairy US - Consolidating leadership of the total category while progressing in the Greek segment x 2.2 Oikos $ sales Q1 11 Q1 12 MS Value Source : IRI 33,0 25,0 15,8 6,9 Total Danone* Competitor 1 Competitor 2 Oikos* * Dannon + Stonyfield janv.-12 févr.-12 mars-12 avr.-12 mai-12 20

21 Fresh Dairy Brazil Building undisputed leadership Internal Market Huge emerging middle class Value market shares 29,8 30,5 32,9 32,6 33,2 34,1 35,8 37,1 Danone 26,9 25,9 22,9 21,4 22,4 22,4 21,1 19,8 Competitor AB C DE 13,3 13,4 13,6 13,9 13,7 12,4 11,0 11,0 Competitor 2 Volume CAGR % +41% Trading operating margin bps per year Extending leadership to Nord-Este region Other Activia Danoninho 21

22 22 Fresh Dairy - Egypt Building the role of Yogurt as part of a healthy diet Launch Danone Mixy Flavor Yog ,5 110gr Urban Areas 80gr Rural Areas 1,1 25 0,7 0,8 10 A Plain Yogurt Market Danone #1 player after 3 years Vol Adults Vol Kids PCC Kg

23 Waters - Indonesia: Bringing concrete facts & benefits behind hydration Volume CAGR +13% > 9 bn liters Bogor Agriculture Institute University of Airlangga University of Hasanudin The First Hydration Study in Indonesia - 4 regions, 1,200 subjects Several congresses across Indonesia Drink at least 2 L of water a day Getting water into the food pyramid 23

24 Waters - Aquadrinks Segment weight value Sparkling 7% HOD 12% Plain Still 55% Aquadrinks 26% Aquadrinks - volumes CAGR +15%

25 Baby Nutrition Continuous outstanding growth in Asia Sales CAGR +15% Agreement for the acquisition of Wockhardt Nutrition FY2009 FY2010 FY % Market share (value MAT April 2012) Super premium Premium Standard Dumex Gold Bebelac Dumex Standard 33.2 % Market share (value MAT April 2012) 44.1% Market share (value MAT April 2012) Super premium Premium Standard Nutrilon Bebelac SGM Gizikita Source : Nielsen 25

26 * Observational Study performed by pediatritions with 577 mothers of babies > 6 mth 26 Baby Nutrition - Turkey Building awareness on the role of Early Nutrition for health Category 10-year CAGR +26% Overall Danone HCP preference 87% Danone Total milk Market shares 80% 6-12 months actual milk intake WHO Babies need 500ml milk after 6 months 290 ml Min 500 ml Breast Milk (+FOF) Pediatric Association HCP Meetings with Ministry of Health TV Series Connect to Bloggers WHO educational Meetings Social Responsability Project HCP E- Meetings - 25% cvg.

27 27 Medical Nutrition - China Medical division in China Example : Neocate in China Like-for-like sales growth + 30% 1st contributor to division growth Parents Meetings KOL Round Table HCP elearning Increase Allergy Awareness to fasten diagnostic & Treatment Clear leader in China Demonstrate Neocate Superiority Help Parents to follow treatment for symptoms release Call center Social Media Website Blogs Clinical evidences

28 28 Outstanding geographical footprint for growth Q1 2012: sales in Emerging Countries = 52% Top 6 priority countries contributing around 60% of sales growth and more than 3/4 of EBIT growth in 2011 Western Europe 35% 52% Emerging countries 3% 10% Japan + NZ North America 28

29 29 Outstanding Geographical Profile % Group Sales* Margin* Growth Prospects EUROPE excl. CIS 45% Close to Average Flat CIS + NORAM 20% Below Average High-Single-Digit REST of WORLD 35% Above Average Double-Digit * FY 2011

30 Conclusion Continuous investment in the well-performing growth markets Specific situation addressed in Southern Europe 2012: Sales growth & FCF target reiterated / Margin target adjusted Value creation agenda adapted to the current environment Danone Vision & Strategic priorities unchanged 30 30

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