PULEVA FOOD S.L.

Madrid. 5 December 2002

HISTORY-1

• 1954 Unión Vinícola Industrial S.A. is converted into Unión Industrial y Agroganadera S.A. (UNIASA)

• 1958 Uniasa opens 1st Factory for Milk and Dairy Products• 1975 Uniasa opens 2nd Factory to substitute the first• 1976 Uniasa buys 50% of EDDA• 1982 Uniasa buys 100% of EDDA • 1987-89 Uniasa buys the dairies:

La Merced (Jerez), Colema (Málaga), Cunia (Sevilla) and Ledesa (Salamanca)

• 1990 Uniasa builds plant in Montouban (France)• 1992 Uniasa changes its name to Puleva S.A.• 1992 Builds new baby food factory• 1992 Strategic change of focus. Functional milks• 1994 Puleva SA goes into receivership

•1994 Sale of tangible and intangible assets of the Baby Foods Divison and the R+D Dept. to Abbott Lab (USA)

•1995 Industrial Restructuring. Closing of Plants

•1996 Labour force adjustment plan (redundancies)

•1996 Lifting of receivership

•1996 Creation of new R+D Dept. and recovery of key employees

•1999 Puleva acquires Lactaria Española and Leyma

•2000 Puleva buys 80% of Granja Castelló

•2000 Puleva merges with Azucarera Ebro Agrícolas

•2000 New company created: Puleva Food S.L., subsidiary of Ebro-Puleva.

•2001 Puleva Food S.L. merges with Leyma, Lactaria Española and Granja Castelló

•2001 Spin-off of R+D section. Creation of Puleva Biotech

HISTORY-2

1977 1988 1994

turnover

The driving force behind strategic change

Baby Foods

Process of change

• The state of imitation• Search for distinction• Activation of R+D System• Scientific Knowledge Management• Creation of Knowledge (Patents)• Strategic Approach. Groups• The variables of Competition• Innovation Process

Puleva R+D

University Hospitals

The research triangle

Pharmaceuticals

Food

Product

Consumer

Properties

Prescription

confidence

Brand

Values

EDDA R+D

Puleva

Strategic Positioning

The Dairy Sector

Sector Traits

• Mature sector• Milk production represents 5% of the European

total• Regulated raw material. Quota system. Deficit• Balance between real production and consumption• Geared towards liquid milk and little towards dairy

products. Not distinguished• Small companies in comparison with rest of Europe,

despite the concentration process begun (Puleva, CAPSA)

• Excess of industrial capacity• Heavy presence of dealers’ brands• Minimum investment in R+D• Significant presence of international enterprises

4.5%Ireland

4.8%Spain

6.8%Sweden/Denmark

9.2%Italy

9.3%Netherlands

12%United Kingdom

20%France

23%Germany

% ProductionCountries

Cheese5%

Others4%

Liq.Milk

Yoghurt12%

Dairy Sector. Product Portfolio

DriedMilk15%

Liq.Milk40%

Butter12%

Others6%

Cheese27%

Spain Europe

HOW TO GROW ?

IN A MATURE SECTOR

Cooperatives

Food

Product

Consumer

Properties

confidence

Brand

Values

R+D

Puleva

Strategic Positioning

Segmentation

Health

Food Health

Food

Function

Creation of value

Strategic equation

Company Consumer

A+D, Calcium,Omega…

ALIMENTO

FUNCIN

PRODUCT STRATEGY

LIQUID MILK

Inoculate the market

ALIMENTO

FUNCIN

PRODUCT STRATEGY

Development of new segment

Change of competition variables

Market of liquid milk

Source: Nielsen Retailers Panel

(added vitamin milks included in special. account for1.8 points)

94.1

4.31.6

90.7

72.3

84.4

10.94.7

83.4

11.35.3

78.6

14.4

7

0%

20%

40%

60%

80%

100%

C.A.G.JJ99 C.A.G.AS00 C.A.G.AS01 C.A.G.AS02 C.A.G.AS02

Classical Calcium Special

Share in litres in value

High-calcium and special milks is the segment ofgrowth promoted by Puleva

0,0%

5,0%

10,0%

15,0%

20,0%

25,0%

30,0%

35,0%

40,0%

45,0%

PULEVA PASCUAL ASTURIANA DEALERS'BRANDS REST

C.A.G. AS 2001 C.A.G. AS 2002

Shares in functional milks

Fuente: Datos InternosSource: Nielsen

% % TOTALTOTAL MARKET LIQUID MILKMARKET LIQUID MILKBRANDSBRANDS

9.4%

13.7%11.7%

26.5%

38.7%

0,0%

5,0%

10,0%

15,0%

20,0%

25,0%

30,0%

35,0%

40,0%

45,0%

PULEVA PASCUAL ASTURIANA DEALERS'BRANDS R E S T

C.A.G. AS 2001 C.A.G. AS 2002

Fuente: Datos InternosSource: Nielsen

% % TOTALTOTAL MARKET LIQUID MILKMARKET LIQUID MILKGROUPSGROUPS

15.0%

14.1%

14.6%

13,0%

13,5%

14,0%

14,5%

15,0%

15,5%

PULEVA GROUP PASCUAL GROUP ASTURIANA GROUP

C.A.G. AS 2001 C.A.G. AS 2002

38.238 38.318 37.022 35.194 31.819 36.200 36.932

142.308149.444

136.821

114.298104.439

13.58928.982

51.685

95.832

131.157

171.851192.900

219.692

31.776

118.163 116.245109.456

1995 1996 1997 1998 1999 2000 2001 2002

A+D Enriched

WHOLENUTRITIONAL

LONGLONG--LIFE MILKLIFE MILK

Fuente: Datos InternosEV

OL

UT

ION

OF

SA

LES

BY

AR

EA

S19

95-2

002

Vol

ume

inT

hous

. of L

itres

(000

)

Source: Own compilation

Fuente: Datos Internos

0

50.000

100.000

150.000

200.000

250.000

300.000

350.000

400.000

`95 `96 `97 `98 `99 `00 `01 `02 Years

Thou

sand

s of

Litr

es

Omega3

High-Calcium

A+D Enriched

ClassicalWhole

LONGLONG--LIFE MILKLIFE MILK

1010 M.A.M.A. BarcelonaBarcelona

Source: Own Compilation

05.00010.000

15.00020.00025.000

1995 1996 1997 1998 1999 2000 2001

CLASSICAL HIGH CALC. OMEGA 3

0

2.000

4.000

6.000

8.000

1995 1996 1997 1998 1999 2000 2001

CLASS.WHOLE HI-CALC.WHOLE

0

2.000

4.000

6.000

8.000

1995 1996 1997 1998 1999 2000 2001

SEMI A+D SEMI CALC.

0

2.000

4.000

6.000

1995 1996 1997 1998 1999 2000 2001

SKIMMED A+D SKIMMED HIGH-CALCIUM

0

5.000

10.000

15.000

20.000

25.000

1995 1996 1997 1998 1999 2000 2001

OMEGA 3

SPECIAL

MILK DRINKS

SKIMMED HI-CALC.

SKIMMED A+D

SEMI CALC.

SEMI A+D

HI-CALC.WHOLE

CLASS.WHOLE

EV

OL

UT

ION

OF

SA

LES

BY

AR

EA

S19

95-2

001

Vol

ume

inT

hous

.ofL

itres

(000

)

4040 MM..A.A. MadridMadrid

Source: Own compilation

0

10.000

20.000

30.000

1995 1996 1997 1998 1999 2000 2001

CLASSICAL HIGH-CALC. OMEGA 3

0

2.000

4.000

6.000

8.000

1995 1996 1997 1998 1999 2000 2001

CLASS. WHOLE HIGH CALC. WHOLE

02.0004.000

6.0008.00010.000

1995 1996 1997 1998 1999 2000 2001

SEMI A+D SEMI HIGH-CALC.

0

2.000

4.000

6.000

8.000

1995 1996 1997 1998 1999 2000 2001

SKIMMED A+D SKIMMED HIGH-CALC.

0

5.000

10.000

15.000

20.000

25.000

30.000

1995 1996 1997 1998 1999 2000 2001

OMEGA 3

SPECIAL

MILK DRINKS

SKIMMED HI-CALC.

SKIMMED A+D

SEMI CALC.

SEMI A+D

HI-CALC.WHOLE

CLASS.WHOLE

EV

OLU

TIO

N O

F S

ALE

S B

Y A

RE

AS

199

5 -2

001

Vol

ume

in T

hous

. of L

itres

(0

00)

Pleasure

Milk shakes

Yog-hurt

A brand focusing on health is an adults’ brand

The brand must be worked on to secure its position in the world of children and young people

New Challenges. Puleva

TOT.SPAINC.A.G. C.A.G.

AS 2001 AS 2002 AS2001ON2001DE2002FM2002AM2002 JJ2002 AS2002

TOTAL 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%

PULEVA 17.3% 20.0% 17.5% 19.1% 19.4% 19.4% 21.3% 19.5% 21.1%

RAM 3.4% 2.1% 2.4% 2.8% 2.8% 2.7% 2.4% 1.5% 1.3%

CACAOLAT 10.2% 9.1% 9.4% 10.0% 11.2% 9.7% 8.6% 8.2% 8.1%

PASCUAL 9.1% 8.9% 6.8% 9.5% 10.5% 10.7% 10.1% 7.4% 7.0%

CHOLECK 11.3% 10.3% 12.6% 10.1% 9.7% 10.1% 9.5% 11.2% 10.8%

OKEY 6.2% 5.8% 6.3% 5.8% 6.2% 5.6% 5.5% 5.8% 6.1%

ASTURIANA 5.1% 4.7% 4.9% 4.8% 4.7% 4.7% 4.3% 4.9% 4.7%

EL PRADO 4.6% 4.2% 7.3% 3.1% 1.9% 2.1% 2.9% 6.8% 6.4%

NESQUIK 1.3% 1.4% 1.0% 1.7% 1.6% 1.6% 1.7% 1.2% 1.0%

KAIKU 0.5% 0.7% 0.7% 0.9% 0.9% 0.9% 0.7% 0.6% 0.5%

COVAP 2.5% 1.9% 2.3% 2.5% 2.8% 2.1% 1.7% 1.5% 1.0%

DEALER BR. 22.1% 25.5% 23.6% 23.9% 22.4% 24.6% 26.1% 27.2% 26.9%

REST 6.2% 5.2% 5.2% 5.7% 5.8% 5.7% 5.2% 4.3% 5.1%

PULEVA GP. 21.4% 22.2% 20.1% 22.1% 22.3% 22.2% 23.7% 21.0% 22.4%

Milkshake Market. Food

Optimise the other brands: Ram, Castillo,Leyma

• Regional position of El Castillo in the area of Catalonia and Leyma in Galicia

• National position of Ram as second brand

Optimise the industrial structure

New Challenges. 2

INDUSTRIAL PLANTS

Arteixo

LugoLeón

GranadaSevilla

Jerez

Mollerusa

Earnings EBITDA % EBITDA

1995 128,773 1.00 2,915 1.00 2.26%1996 141,586 1.10 11,137 3.82 7.87%1997 150,746 1.17 15,121 5.19 10.03%1998 171,457 1.33 16,690 5.73 9.73%1999 372,844 2.90 29,588 10.15 7.94%2000 511,936 3.98 34,605 11.87 6.76%2001 538,355 4.18 42,972 14.74 7.98%2002 512,349 3.98 48,607 16.68 9.49%

EVOLUTION EARNINGS-EBITDA

(000 euro)

Analysis of strong points

• Gearing towards consumer• Leadership in innovation• Leadership in clinical research• Referente en el sector.• Referente tecnológico• Well-known brand• Portfolio of brands• Generator of cash-flow• Organic growth and growth capacity through

acquisitions