M Dias Branco S A Indústria e Comercio de Alimentos : 4Q21 and 2021 Earnings Release

EARNINGS RELEASE 4Q21 | 2021

Earnings

Release

4Q21 | 2021

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Eusébio (CE), March 18, 2022 - M. Dias Branco S. A. Indústria e Comércio de Alimentos (B3: MDIA3), leader in Brazil's cookie & cracker and pasta markets, announces today its results for the fourth quarter of 2021 (4Q21) and full year (2021). The consolidated financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS) and the accounting practices adopted in Brazil (BR GAAP).

WEBINAR 4Q21 | 2021

MARCH 21, 2022

Time:

> Portuguese

11h00 (Brasília Time)

10h00 (NY Time)

Registration in Zoom Meetings:

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> English

11h00 (Brasília Time)

10h00 (NY Time)

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Stock Price:

Closing on 03/16/2022 MDIA3: R$ 20,51 per share Market Cap: R$ 6.9 billion

CONTATOS RI

Gustavo Lopes Theodozio

Vice-President of Investments and Controllership Phone: [phone]

Email: [e-mail]

Fabio Cefaly

New Business and Investor Relations Officer Phone: [phone]

Email: [e-mail]

Rodrigo Ishiwa

Investor Relations Manager

Phone: [phone]

Email: [e-mail]

[e-mail]

ri.mdiasbranco.com.br

youtube.com/rimdias

EARNINGS RELEASE 4Q21 | 2021

M. Dias Branco's net revenue reaches R$ 7.8 billion in 2021,

up by 7.7% over 2020.

Cash generation1 grows by 41.3%, to R$960 million

• Net Revenue: R$7.8 billion in 2021, up by 7.7% (R$2.2 billion in 4Q21, +27.2%);
• Gross revenue from new products of the cookies & crackers category: R$291.7 million in 2021, up by 48.1% (R$95.5 million in 4Q21, +73,3%);
• Market Share Volume: we remained as the market leader, closing 2021 with a share of 32.5% in the cookies & crackers (32.9% in 4Q20) and 30% in the pasta (32.5% in 4T20) categories;
• Cost of Goods Sold increased due to the 4.6% depreciation of the Brazilian real against the U.S. dollar2, and the increases of 23.1% in wheat flour, and 49.2% in palm oil, both of which priced in U.S. dollars3;
• Selling and administrative expenses accounted for 21% of net revenue in 2021 (24.3% in 2020). The decrease is structural and results from recent productivity and efficiency programs;
• EBITDA: R$ 683,9 million in 2021 (-29.8% in 2020) and R$ 182,7 million in 4Q21 (-4.9% in 4Q20). The decrease resulted from high commodity prices in U.S. dollars and non-recurring tax credits that positively impacted 2020 results;
• Net Income: R$505.0 million in 2021 (-33.9% in 2020) and R$151.1 in 4Q21 (-27.7% in 4T20);
• Working capital: release of R$ 284 million in 2021 and consumption of R$ 92.6 million in 4Q21;
• Cash generated by operating activities of R$ 959.7 million in 2021 and R$165.3 million in 4Q21;
• Leverage of 0.2x (net debt/LTM EBITDA), lower than in 4Q20 (0.4x);
• Rating AAA with a Stable Outlook reaffirmed by Fitch for the fourth consecutive year;
• 1st issue of CRAs in March 2021, totaling R$811.6 million (three times the initial value), with a rating of AAA and a stable outlook certified by Fitch Ratings and Green Seal;
• ISE, for the second time we are part of B3's Corporate Sustainability Index;
• Awards in 2021:

1. Best company in the Brazilian Food category (The Best of Dinheiro Award); o Top of Mind 2021 (Folha Award);
   o Transparency Trophy 2021 for the fifth consecutive year (ANEFAC-FIPECAFI Award); o Largest food industry in the Northeast (Valor 1000 Award);
   o 100 Open Startups 2021 Ranking.

1. Net cash generated from operating activities
2. Annual average of the monthly closings
3. Average annual acquisition price in M. Dias Branco's inventories in US$

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EARNINGS RELEASE 4Q21 | 2021

MESSAGE FROM MANAGEMENT

Dear all,

2021 was marked by several challenges for the market and society in general. The coronavirus pandemic, the macroeconomic, political and social context led people, institutions and organizations to adapt and adopt protective measures in line with their strategies.

The M. Dias Branco, based on their own experience of almost 70 years in the market, and firmly motivated by the belief in Brazil and in the recovery of the world economy, carried out important strategic changes, with the purpose of continuing its historical trajectory of growth and profitability, combined with the maintenance of the recognized quality of its products.

As the main obstacles confronted in 2021, we highlight the rise in the costs of our supplies due to the devaluation of the Real against the US Dollar, as well as the rise in commodity prices. In a scenario of consumption impacted by inflation, there are natural difficulties in offsetting this increase in costs in passing through the price to the consumer. We know, however, that this is an atypical and transitory scenario. In this context, in addition to several other measures, we adopted concrete and effective actions to recover margins and protect cash.

The Company, rated with AAA rating with a stable outlook, reaffirmed by Fitch Ratings, has high financial solidity and low leverage, with emphasis on the debt extension after the issuance of the Agribusiness Receivables Certificates - CRA, carried out in 2021. This financial structure solid foundation combined with an efficient pricing policy and constant attention to consumer desires and possibilities have been of fundamental importance for us to overcome these challenges.

We continue to invest to enable sustainable growth in the medium and long term, especially with the launch of higher value-added products and investments in marketing. It is in this context that the acquisition of the Latinex company in 2021 is inserted. With the FIT FOOD, Frontera, Smart and Taste&Co brands, Latinex reinforces the Company's presence in healthy food and snacks, in addition to marking its entry into the seasonings, sauces and condiments, which reflects the company's commercial strategy to grow profitably, including in its portfolio products with high growth potential and value

In the search for greater efficiency and productivity, we carried out an important corporate restructuring. Some positions were suppressed, others created and some areas unified. All in favor of greater synergy, security and agility in the performance of our activities. In this context, two new statutory boards were created: Vice-Presidency for Supply Chain and Vice-Presidency for Legal, Governance, Risks and Compliance.

This corporate restructuring generated significant savings in our costs and also provided us with an adequate structure to continue growing with a focus on the needs of our customers and the development of the market in which we operate, as well as representing a reinforcement of our unwavering commitment to seek to guarantee the highest level of corporate governance in our operations.

In 2021, we also revised M. Dias Branco's strategic sustainability agenda with a focus on 2030, with long-term public commitments. Climate change, diversity, inclusion and surrounding communities are topics that received even more attention. We remained in the ISE portfolio (B3's Corporate Sustainability Index), evolved from D to B- in the CDP (Carbonlosure Project) ranking, and raised funds unprecedented in the Company's history through the already issued CRA, which was delivered as "Green Title".

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EARNINGS RELEASE 4Q21 | 2021

In terms of social investment, among other actions, we donated more than 4,300 tons of food to institutions in the vicinity of our units to food banks. We also collaborated with the victims of the rains that hit Bahia at the end of the year.

We are a Company attent to its time. We are present on the main e-commerce and delivery platforms in the country and we remain connected with startups and disruptive culture through our Germinar program.

We recognize our leading position in the national market for pasta and cookies and we are proud of the dedication and union of our employees, and we allow ourselves, supported by our entrepreneurial spirit, our market experience, capacity for work and innovation, to live up to each more and more, to our positioning of "Dreaming, Achieving, Growing", generating value for shareholders and society.

Have a nice read!

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