Danone : Notice of Meeting (brochure)

COMBINED SHAREHOLDERS' MEETING

NOTICE OF MEETING

THURSDAY 25 APRIL 2024, AT 2:30 P.M.

Doors opening at 1:30 p.m.

WARNING - VIGIPIRATE

Due to the "Emergency attack" level of the Vigipirate plan, security checks will be required at the entrance of the Salle Pleyel, including the presence of security gates. Bags and luggage must be shown to security guards and must be left

in the luggage room.

To facilitate your arrival, we recommend that you arrive before 2:00 p.m. with your ID.

You will find more information in this document.

Please note that there will be no cocktail reception at the end

of the Shareholders' Meeting.

Chairman'smessage

Gilles SCHNEPP

Ladies and Gentlemen, dear Shareholders,

I look forward to seeing you on Thursday, April 25, 2024 at 2:30 pm for the Annual Shareholders' Meeting.

In a complex and uncertain context, 2023 was a founding year for Danone; a year of solid results and steady progress in the deployment of our Renew Strategy. Together, we will have the opportunity to retrace the journey and the work accomplished with Antoine de Saint-Affrique, our Chief Executive Officer.

2023 also marked the launch of the "Danone Impact Journey", the sustainability roadmap, and key announcements in this field (for example, 30% reduction in methane emissions, a partnership announced at COP28 with the "Global Methane Hub"), and the publication of our climate transition plan. We will be presenting you an update on the implementation of this transition plan on April 25.

The renewal of the Board's composition was completed last year, with a tightened international and diversified group of directors. Thus, at this Shareholders' Meeting you will be asked to renew the terms of office of Gilbert Ghostine and Lise Kingo, so that this newly reconstituted Board can continue to support, with great commitment and ambition, the acceleration of the Group's transformation, in the interest of its shareholders and stakeholders.

In 2024, Danone is a unique group thanks to its history, its product portfolio and its pioneering spirit and commitment - all of which will be highlighted at the Capital Market Event in June 2024 and the Olympic and Paralympic Games in Paris this summer. We are all committed to supporting this forward-thinking group in our path towards sustainable, responsible performance and growth under the leadership of Renew Danone.

We are therefore counting on you and your valuable voice to participate in the major decisions and orientations of the company. In this document, you will find all the information you need for this meeting, as well as instructions on how to participate.

On behalf of the Board of Directors, I would like to thank each and every one of you for your confidence and strong support.

Gilles Schnepp,

Chairman of the Board of Directors.

DANONE - NOTICE OF MEETING 2024 1

Contents

Key figures	3
Summary of the Company's situation during the last
fiscal year	4
Financial results of the Company during the last five
fiscal years and other significant information	11
Agenda of the Shareholders' Meeting	12
How to participate in the Shareholders' Meeting?	13
How to complete your voting form?	18
Governance	20
Report from the Board of Directors and resolutions
submitted to the Shareholders' Meeting	25
Special report of the Statutory auditors	37
Transfer of securities into a direct registered account	39
Request for additional information	41

• DANONE - NOTICE OF MEETING 2024

Key figures

FINANCIAL INDICATORS

+7.0%	+142 bps	97 bps
ORGANIC SALES GROWTH	MARGIN FROM OPERATIONS	REINVESTMENTS
+3.4%	€2.6 bn	€2.10
RECURRING EPS	FREE CASH FLOW	DIVIDEND PER SHARE

SUSTAINABILITY INDICATORS

AAA (a)	83%	89%
AWARDED BY CDP FOR	SALES COVERED	SALES IN VOLUMES
THE 5TH YEAR	BY B CORP™	RATED ≥ 3.5 STARS
IN A ROW	CERTIFICATION	BY THE HEALTH STAR
		RATING SYSTEM

(a) Scores obtained as part of the CDP Climate Change, CDP Water Security and CDP Forests questionnaires.

Key financial figures

		Year ended December 31
	2022	2023	Reported	Like-for-like
(in € millions except if stated otherwise)	changes	changes (b)
Sales	27,661	27,619	(0.2)%	+7.0%
Recurring operating income (b)	3,377	3,481	3.1%
Recurring operating margin (b)	12.2%	12.6%	40 pb
Recurring net income - Group share (b)	2,205	2,283	3.5%
Net income - Group share	959	881	(8.1)%
Recurring EPS (in €) (b)	3.43	3.54	3.4%
EPS (in €)	1.48	1.36	(8.0) %
Free cash flow (b)	2,127	2,633	23.8%
ROIC	8.9%	9.5%	60 pb

1. Financial indicator not defined in IFRS, see definition in section 3.6 Financial indicators not defined in IFRS of the 2023 Universal Registration Document which was filed with the French Financial Markets Authority on March 12, 2024.

DANONE - NOTICE OF MEETING 2024 3

Summary of the Company's

situation during the last fiscal year

For more information on the Group's situation during the previous fiscal year, please refer to section 3. Business Highlights in 2023 of the 2023 Universal Registration Document which was filed with the French Financial Markets Authority on March 12, 2024 under number D.24-0099 and which is available on Danone's website at the following address: www.danone.com (Section Investors / Publications & Events / Registration Documents/URD).

KEY FINANCIAL FIGURES

		Year ended December 31
	2022	2023	Reported	Like-for-like
(in € millions except if stated otherwise)	changes	changes (a)
Sales	27,661	27,619	(0.2%)	+7.0%
Recurring operating income (a)	3,377	3,481	3.1%
Recurring operating margin (a)	12.2%	12.6%	40 pb
Non-recurring operating income and expenses (a)	(1,234)	(1,438)	(205)
Operating income	2,143	2,042	(4.7%)
Operating margin	7.7%	7.4%	(35) pb
Recurring net income - Group share (a)	2,205	2,283	3.5%
Non-recurring net income - Group share	(1,246)	(1,402)	(156)
Net income - Group share	959	881	(8.1%)
Recurring EPS (in €) (a)	3.43	3.54	3.4%
EPS (in €)	1.48	1.36	(8.0%)
Free cash flow (a)	2,127	2,633	23.8%
Cash flow from operating activities	2,964	3,442	16.1%

(a) See definition in section 3.6 Financial indicators not defined in IFRS of the 2023 Universal Registration Document.

SALES

Consolidated sales

In 2023, consolidated sales stood at €27,619 million, up +7.0% on a like-for-like basis, with price up +7.4% and volume/mix down -0.4%. Volume/mix improved progressively throughout the year, to turn positive in Q4 (+0.8%).

On a reported basis, sales decreased by -0.2%, reflecting notably a negative impact from forex (-4.3%), driven by the depreciation of the majority of currencies against the euro. Reported sales were also penalized by a negative effect from scope (-3.4%), while hyperinflation contributed positively to reported sales (+1.8%).

• DANONE - NOTICE OF MEETING 2024

SUMMARY OF THE COMPANY'S SITUATION DURING THE LAST FISCAL YEAR	2
				Sales
Sales by Zones
		Year ended December 31
	2022 (a) (c)	2023 (a) (d)	Sales growth (e)	Volume Mix /
(in € millions except percentage)	Growth (e)
Europe (b)	8,871	9,382	5.9%	(3.3%)
North America	6,712	6,889	5.8%	0.2%
China, North Asia & Oceania	3,428	3,496	10.1%	8.6%
Latin America	2,805	2,794	9.8%	(1.3%)
Rest of the World	5,846	5,058	7.2%	(1.8%)
TOTAL	27,661	27,619	7.0%	(0.4%)

1. Net sales to third parties.
2. Including net sales of €2,324 million generated in France in 2023 (€2,134 million in 2022). See Note 7.2. to the Consolidated financial statements for 2023, included in the 2023 Universal Registration Document.
3. As part of the new organization, 2022 sales were reallocated in line with the redefinition of operating segments.
4. As part of the changes in the geography-led organization, 2023 sales were reallocated in line with the redefinition of operating segments (see Note 2.1 to the Consolidated financial statements for 2023), included in the 2023 Universal Registration Document.
5. Like-for-like.

Europe

Sales

Europe posted sales growth of +5.9% in 2023 on a like-for-like basis, driven by +9.2% growth in price and a -3.3% decrease in volume/ mix.

Main Markets

In EDP, the portfolio transformation started to deliver results, and the performance improved sequentially throughout the year, led by Actimel, Danone, YoPro and Alpro. Specialized Nutrition delivered resilient growth in a soft category while Waters registered double- digit like-for-likesales growth, driven notably by evian, Volvic and Zywiec Zdroj.

North America

Sales

North America posted +5.8% sales growth in 2023 on a like-for-like basis, driven by +5.6% growth in price and a +0.2% growth in volume/mix.

Main Markets

North America delivered a strong performance in 2023, led by coffee creations and yogurts, and in particular by International Delight, Stok and Oikos. In plant-based, Danone is working on restoring its short-term competitiveness, while progressing in the restaging of its portfolio.

China, North Asia & Oceania

Sales

China, North Asia & Oceania posted sales growth of +10.1% in 2023 on a like-for-like basis, driven by +1.5% growth in price and a +8.6% growth in volume/mix.

Main Markets

China, North Asia & Oceania registered strong competitive growth in 2023. In China, Aptamil registered strong growth in infant nutrition, coupled with further market share gains, while Nutrison and Neocate posted double-digit growth in Adult Nutrition and Pediatric Specialties respectively. In Waters, Mizone is confirming its turnaround, growing double-digits, led by volume and market share gains. Outside China, EDP registered double-digit growth in Japan, led by functional brands.

Latin America

Sales

Latin America posted sales growth of +9.8% on a like-for-like basis, driven by +11.1% growth in price, while volume/mix declined by -1.3%.

Main Markets

The performance was driven by all geographies and categories, and notably driven by Oikos, YoPro and Bonafont. In Brazil, Danone is progressing on the transformation of its business model, towards the more value-added parts of its portfolio.

Rest of the World

Sales

Rest of the World registered sales growth of +7.2% on a life-for-like basis, driven by price growth of +9.0%, while volume/mix decreased by -1.8%.

Main Markets

The performance was driven by all categories in 2023. In particular, Specialized Nutrition was led by a sustained momentum across Asia and Middle East, while Waters posted a solid performance, notably in Indonesia. In Africa, Danone is progressing in fixing its dairy business model, while building more structural resilience.

DANONE - NOTICE OF MEETING 2024 5

• SUMMARY OF THE COMPANY'S SITUATION DURING THE LAST FISCAL YEARSales

Sales by categories

			Year ended December 31
					Share of sales	Share of sales
			LFL Sales	Volume Mix /	delivered by	delivered by
	2022	2023	categories in	categories in
(in € millions except percentage)	growth (a)	Growth (a)	2022	2023
EDP	14,799	14,322	6.6%	(1.4%)	54%	52%
Specialized Nutrition	8,319	8,504	6.7%	0.6%	30%	31%
Waters	4,543	4,793	9.1%	0.8%	16%	17%
TOTAL	27,661	27,619	7.0%	(0.4%)	100%	100%

(a) Like-for-like.

OTHER COMPONENTS OF THE INCOME STATEMENT

Consolidated recurring operating income and recurring operating margin

Danone's recurring operating income reached €3.5 billion in 2023.

Recurring operating margin stood at 12.6%, up +40 basis points (bps) compared to last year. This increase was mainly driven by the improvement of margin from operations, up +142 bps: topline drivers, including volume, mix and price, had a combined positive impact of circa +590 bps, partially offset by the still strong negative impact of input-cost inflation net of productivity, at circa -450 bps.

Besides, Danone continued to step-up its reinvestments in brands, product superiority and capabilities, which had a negative effect of -97 bps in 2023. Finally, Scope, Forex and others had a positive impact on Recurring operating margin of +13 bps, partially offset by Overheads before reinvestments, that had a negative effect of -18 bps.

Cost of goods sold totaled €14,535 million in 2023 (€14,922 million in 2022), or 52.6% of consolidated sales (53.9% in 2022).

Selling expense totaled €6,288 million in 2023 (€6,294 million in 2022), or 22.8% of consolidated sales, broadly in line with 2022.

General and administrative expense totaled €2,748 million in 2023, or 9.9% of consolidated sales (9.5% in 2022). Research and Development costs totaled €398 million in 2023, up compared to 2022 (€339 million) (see section 3.1 Business highlights in 2023).

Other income and expense stood at €(170) million in 2023 (€(92) million in 2022).

FREE CASH FLOW AND NET DEBT

Free cash flow

Free cash flow reached €2,633 million in 2023, increasing from €2,127 million in 2022, reflecting the significant increase in cash- flow from operating activities. Capex stood at €847 million.

Changes in net debt in 2023

Danone's net debt totaled €10,221 million as of December 31, 2023, an increase of €114 million compared to December 31, 2022. It included €356 million of put options granted to non-controlling interests, €33 million higher than as of December 31, 2022.

Dividend paid in respect of 2023 fiscal year

At the Annual Shareholders' Meeting on April 25, 2024, Danone's Board of Directors will propose a dividend of €2.10 per share in respect of the 2023 fiscal year, up +5.0% compared to last year, and back to 2019 record-level. Assuming this proposal is approved, the ex-dividend date will be May 3, 2024, and dividends will be payable on May 7, 2024.

• DANONE - NOTICE OF MEETING 2024

SUMMARY OF THE COMPANY'S SITUATION DURING THE LAST FISCAL YEAR	2
Main financial data for the 2022 and 2023 fiscal years

MAIN FINANCIAL DATA FOR THE 2022 AND 2023 FISCAL YEARS

The financial information presented in the tables hereinafter are taken from the group's 2023 consolidated financial statements prepared in accordance with International Financial Reporting Standards and are presented in section 4.1 Consolidated financial statements and notes to the consolidated financial statements of the 2023 Universal Registration Document available on Danone's website at the following address: www.danone.com(Section Investors / Publications & Events / Registration Documents/URD).

Consolidated income statement and earnings per share

		Year ended December 31
(in € millions, except earnings per share in €)	Notes	2022	2023
Sales	7.1, 7.2	27,661	27,619
Cost of goods sold		(14,922)	(14,535)
Selling expense		(6,294)	(6,288)
General and administrative expense		(2,637)	(2,748)
Research and Development expense		(339)	(398)
Other income (expense)	7.3	(92)	(170)
Recurring operating income		3,377	3,481
Other operating income (expense)	8.1	(1,234)	(1,438)
Operating income		2,143	2,042
Interest income on cash equivalents and short-term investments		155	341
Interest expense		(308)	(513)
Cost of net financial debt	12.7	(153)	(172)
Other financial income	13.3	51	60
Other financial expense	13.3	(208)	(245)
Income before tax		1,832	1,686
Income tax	10.1	(778)	(768)
Net income from fully consolidated companies		1,054	917
Share of profit (loss) of equity-accounted companies	6.5, 6.6	(32)	36
NET INCOME		1,023	953
Net income - Group share		959	881
Net income - Non-controlling interests		64	72
Earnings per share - Group share	15.4	1.48	1.36
Diluted earnings per share - Group share	15.4	1.48	1.36

DANONE - NOTICE OF MEETING 2024 7

2	SUMMARY OF THE COMPANY'S SITUATION DURING THE LAST FISCAL YEAR
	Main financial data for the 2022 and 2023 fiscal years
		Consolidated balance sheet
				As of December 31
		(in € millions)	Notes	2022		2023
		ASSETS
		Goodwill		17,938		17,340
		Brands		5,843		5,256
		Other intangible assets		458		498
		Intangible assets	11.1 to 11.3	24,239		23,093
		Property, plant and equipment	7.5	6,752		6,441
		Investments in equity-accounted companies	6.1 to 6.7	576		416
		Investments in other non-consolidated companies		341		324
		Long-term loans and financial assets		468		515
		Other financial assets	13.1, 13.2	808		839
		Derivatives - assets (a)	14.2, 14.3	18		34
		Deferred taxes	10.2	735		746
		Non-current assets		33,128		31,570
		Inventories	7.4	2,619		2,341
		Trade receivables	7.4	3,272		2,919
		Other current assets	7.4	1,315		1,259
		Short-term loans		3		3
		Derivatives - assets (a)	14.2, 14.3	60		16
		Short-term investments	12.1, 12.5	3,631		3,638
		Cash		1,051		2,363
		Assets held for sale (b)	4, 5.2, 6.6	202		376
		Current assets		12,153		12,916
		TOTAL ASSETS		45,281		44,486

1. Derivative instruments used to manage net debt.
2. As of December 31, 2023, this concerns assets relating to the organic dairy business in the United States and to Michel et Augustin.

• DANONE - NOTICE OF MEETING 2024