Danone // 2020 Universal Registration Document

Business highlights in 2020 and outlook for 2021 3.2 Consolidated net income review DANONE UNIVERSAL REGISTRATION DOCUMENT 2020 44 EDP Sales Essential Dairy & Plant-based posted net sales growth of +3.4% in 2020 on a like-for-like basis, reflecting a +3.0% increase in vo- lume and +0.3% in value. EDP performance was sustained by both Essential Dairy, up low-single digit, and Plant-based that grew at +15% and reached €2.2 billion of sales in 2020, up from €1.9 billion in 2019. This performance results from the sustained sales growth of plant-based products in the United-States, Europe and beyond. Danone continues to aim at reaching around €5 billion of revenues from plant-based products by 2025. Main Markets EDP performance was led by Europe and North America, that re- gistered solid growth in 2020. In Europe, Essential Dairy was back to growth, with a broad-based contribution from all key brands, and Plant-based registered high-teens growth, with all geographies contributing. In North America growth was supported by Premium Dairy and Plant-based continued momentum. Top-3 brands in the region – International Delight, Silk, and Horizon – delivered double-digit growth in 2020. In the Rest of the World, CIS was back to growth, with a contribution from traditional and modern dairy brands. Latin America and Africa sales were impacted by Covid-related restrictions affecting sales in traditional proximity stores, the biggest channel in those regions. Specialized Nutrition Sales Specialized Nutrition sales declined by -0.9% in 2020 on a like-for- like basis with a decrease of -0.8% in volume and -0.1% in value. infant nutrition performance was driven by Covid-related headwinds, notably in China, while adult nutrition registered strong growth. Main Markets In China, infant formula sales fromcross-border channels continued to contract sharply in 2020 given the ongoing Hong Kong border closure and travel limitations with mainland China. However, in the Chinese domestic market, consumer demand for Danone’s brands stayed strong, driven by the excellent performance of Aptamil that gained market shares and ranked leading brand of 11:11. Sales in the Chinese domestic market registered positive growth in 2020. In Europe, infant milk and first diet performance were penalized by continued soft category dynamics, while adult nutrition delivered solid growth despite hospital and prescription activity under pres- sure. Other regions posted strong growth, sustained by market share gains in South East Asia and Latin America. Waters Sales Waters sales declined by -16.8% in 2020 on a like-for-like basis, with a decrease of -7.7% in volume and -9.1% in value. The performance of Waters was severely impacted by Covid-related restrictions to mobility that disrupted out-of-home and impulse channels, and ultimately translated in negative volume, product and format mix. Main Markets Europe performance was penalized by several waves of lockdowns and restrictions to mobility, notably in France, Germany and the UK, while market shares were stable. In the Rest of the World, Latin America and Indonesia declined at double-digit rate, due to severe social distancing measures. In China , Mizone performance sequentially improved throughout the year to reach positive growth in the fourth quarter, an encouraging performance given mobility indices in China are still below pre-Covid levels. Sales by geographical area Year ended December 31 (in € millions except percentage) 2019 2020 Sales growth (a) Volume growth (a) Share of sales delivered by the region in 2019 Share of sales delivered by the region in 2020 Europe & Noram 13,710 13,408 -0.3% +1.6% 54% 57% Rest of the World 11,577 10,212 -3.1% -1.6% 46% 43% Total 25,287 23,620 -1.5% -0.1% 100% 100% (a) Like-for-like. Europe & Noram The Europe &Noram region posted sales of €13,408 million in 2020, down -0.3% vs 2019 on a like-for-like basis, including an increase in volume of +1.6%. Rest of the World The Rest of the World region posted sales of €10,212 million in 2020, down -3.1% vs 2019 on a like-for-like basis, including a decline in volume of -1.6%.