Capital Markets Day 2019 Cloetta positioned for profitable growth 2 Cloetta Capital Markets Day 2018 Agenda

• Welcome Jacob Broberg, SVP Corporate Communications & IR • Cloetta positioned for profitable growth Henri de Sauvage-Nolting, President and CEO • From volume focus to sustainable value creation Oskari Vidman, Chief Pick & Mix Officer • Building consumer centric growth Thomas Biesterfeldt, CMO • The Perfect factory Marcel Mensink, President Operations • Financial strategy and road to 14% Frans Rydén, CFO • Q&A • Summary Henri de Sauvage-Nolting Cloetta positioned for profitable growth

Henri de Sauvage-Nolting, President and CEO 4 This is Cloetta

6.2 5 We bring a smile to your Munchy Moments 6 Cloetta’s strengths Strong brand/category positions and pick & mix scale in North Western Europe

Cloetta’s strategic strengths Market Category position

Chewing Pick & Candy Pastilles Chocolate • Strong leading local brands gum mix • Core markets in growing North 1 1 2 - 1 Western Europe 2 4 • Strong European leader in pick & 1 1 1 mix 1 2 3 - 1 • Scale benefits in North Western Europe vs local competition 2 1 3 - 1 • Route to market scale in core markets 1 - - 2 -

• Locally tailored innovation - - - - 1

Based on Cloetta market share in respective category in 2018. 7 Strong heritage brands liked and trusted

by our consumers Local Global Balance Global Local Local Global 8 Growth in Branded Confectionery market Value growth: Cloetta needs to step up in premiumization

CAGR 1,6% 70 140 Index 60 120

50 100

SEKbn 40 80

30 60

20 40

10 20 160 gr 140 gr

0 0 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Total market value* Index market value growth

*Source: Datamonitor/ Mintel Markets: , , , and 9 Focus on core markets and core categories From acquiring new munchy moment categories to organic growth

CORE INTERNATIONAL 10 Core strategy: Organic growth and 14% EBIT From acquisition growth to organic growth

2018: Shift to organic growth • Consumer as boss 2017: Structure change • New management • Disposal of Italy • ONE Cloetta • Acquisition Candyking • Organic growth 2014: Harmonization • Overload moulded factory • Sharpened strategy on the network road to 14% • One ERP system • Factory rationalization & 2012: New company LEAN • Merger Cloetta-LEAF • Smaller acquisitions • Listed on Stock market • HQ in Stockholm 11 Cloetta Core Strategy “To bring a smile to your Munchy Moments”

• Zero tolerance for accidents • Drive cost saving activities – • Strengthen the equity of our ”VIP+” core brands • Create “One Cloetta” • Embed ”Perfect Factory” and Lean • Focus on core categories and • Strengthen brand and category in the supply chain core markets, double international management competence • Insource production

• Fewer and stronger innovations • CSR to drive consumer agenda Drive growth Drive

to drive valorization growth Fund • Improve profitability in pick & mix • Create a winning culture • Create value concepts and • Improve marketing efficiency and • Develop, attract and retain penetration in pick & mix internal systems and processes Facilitate growth Facilitate skilled leaders and employees • Selective acquisitions on core categories and markets

Target: Organic Sales growth in line with market and EBIT margin, adjusted – at least 14% 12 Key Business Priorities Cloetta to organic growth and 14% EBIT margin, adjusted

• Branded business grew +1,5% at 14%+ EBIT in 2018 Branded growth • Four consecutive quarters of growth in 2018

Pick & mix • Pick & mix delivers 1-2% EBIT margin • Solve profitability issues in Sweden ~ SEK -60m EBIT to sustainable in 2018 value • Synergy realization and insourcing

Reduce costs • Value Improvement Program+ and • Factory efficiency improvements drive efficiency 13 Cloetta Branded Business is growing Brands are 72% of total Cloetta sales

3% 2,4%

2% 1,6% 1,3% 1,4%

1% 0,6% 0,0% 0,1% 0% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 -1% 2016 2017 -0,8% 2018 -2%

-2,4% -3% -2,7% -3,1% -4% -4,0% -5% 14 Unique position, fitting consumer trends Competitive position vs global and very local players

Leading Platforms International Local across Brands Brands brands

Local Multiple markets 15 Responsible growth Offering informed choice for consumer

• Consumer as boss • NAF/NAC • Increased resource efficiency • Responsible sourcing of raw material (UTZ) • Employee development and health • Plastic reduction • “Choice for you” strategy 16 Offering consumers the choice

Functional & Indulgence conscious 23 % of Sales 17 Sustainable value creation in pick & mix Short term 2019 & 2020

• Turn around EBIT in pick & mix in Sweden from ~SEK -60m in 2018 to average pick & mix EBIT • Contract and price models being re-developed • Cut cost in warehousing and distribution set-up in Sweden • Continue to insource Candyking volumes • Drive merchandising efficiency • Harmonize assortment 18 Sustainable value creation in pick & mix Medium term

• Drive penetration in Finland, Denmark, Norway and the UK • Develop pick & mix category and brand offering • Develop concepts to fit all markets • Create “Shop in Shop” concept to get more value • E-commerce: – Scale e-commerce – ‘In-store theatre’ needs 19 Well-stocked road-map to deliver targeted 14% EBIT margin

EBIT margin, %

Other value enhancing initiatives Reduce indirects • New and shared best • New program using practices, including on Perfect Factory ZBB methodology revenue management, • Cost efficiency through net productivity, portfolio ≥ 14,0% Branded growth Cloetta Leading and mix management • Scale and speed in Performance Program innovation • Continued insourcing Pick & mix portfolio • Marketing Return including Italian volumes • Candyking synergies on Investment • Pick & mix margin 10,9% turn-around • From volume to value creation Value Improvement Program+ 2018 Mid-term From volume focus to sustainable value creation Oskari Vidman, Chief Pick & Mix Officer 21 Pick & mix – this is how it works Service concept not only selling individual products and brands Selling services

Assortment Fixtures Merchandisers

• Wide range of products • Play an important role in • Fill up products into • Consumer preferences a successful pick & mix fixtures vary by market concept: • Keep fixtures fresh and • Mainly products from ‒ Branding clean candy and chocolate perspective + categories ‒ How products are displayed 22 Pick & mix strengths

Norway Finland 23% 17% ►Geographical spread UK Sweden • Very strong position in the Nordic countries 30% • High share of total confectionary consumption 1% Denmark 10% ►Consumer trend: Individualization • Pick & mix concept catering to consumers seeking to satisfy individual needs • Consumers choosing products and services individually

Pick & mix share of confectionery market volume 23 Cloetta’s pick & mix sales by market

Norway Finland 6 % 18 % Sweden

Denmark 38 % 16 %

The UK 17 %

Other markets 5 % 24 Four pick & mix business models

Bulk • Full concept covers everything from branding, 24% assortment and fixtures to merchandising

• Trade own concept is similar to full concept but with Business Full concept a retailers own branding 55% Hybrid models • In Hybrid models e.g. merchandising can be 7% handled by the customer themselves Trade own • Bulk business is products sold to someone else’s 14% pick & mix solution 25 Candyking acquisition Synergies from insourcing and commercial operations

• Most of the synergies from commercial operations delivered during 2018 • Insourcing in line with plan

• ERP system integration in UK SEKm Accumulated synergy realization 120 • Sweden pick & mix turn-around to profit 100 100 80 80

60 55

40

20

0 2018 2019* 2020*

*Planned 26 Sweden pick & mix turn-around to profit Need to address the ~ SEK 60m loss in 2018

• Harmonize product portfolio and manage tail-end to cut cost • Renegotiate or exit low margin contracts • Move campaigns from volume focus to profit as well • Re-develop contract and price models • Drive merchandizing efficiency through e.g. improved route-planning • Optimize distribution model to cut cost 27 Pick & mix Strategy From volume focus to sustainable value creation

• Offer consumers the best experience in retail trade • Drive category development together with the customer • Deliver innovative products, packages and fixtures • Be the most effective supplier when it comes to merchandising and the efficient supply of goods 28 Pick & mix Strategy From volume focus to sustainable value creation

• Fix Sweden profitability • Unique know-how in the category • Competitive advantage by providing concept solutions to trade and strengthening branding into USP • Channel strategy • Innovative fixture solutions • Efficiency from consolidated execution with branded business Building consumer centric growth Thomas Biesterfeldt, CMO

Confectionary: an attractive market with positive emotions Marketing: leveraging capabilities to win 30

The consumer value

The power of true joy! 31 Positive & fun category 92% of consumers have positive associations with candy Taste-related Needs-related Social-related Positive emotional

fun enjoy life “reward myself Tasty Hygge brings happiness cheer me up togetherness, “can really look celebrate family forward achievement” to eating it!”

Sweet Together-time all the colors makes me enjoyment happier

Source: Insite Consulting, 2018. 32 Consumer Trends in motion…

Conscious consumers Individualization Local relevancy Best agers 50+ High tech – high touch Digitalization – want it now 33 … and Cloetta in good position Local brand heritage

Pick & mix “Nordic way of life” #Socialization #Fredagsmys #Hygge

Leading “Choice for you”

Catering to a wide audience

E-com focus 34 Strong brands liked and trusted by consumers

Local Local Balance Global Global 35 Gaining share in stable market environment Full year 2018

Total Candy Pastilles Chocolate Chewing Gum branded

Total +0,4% +0,3% +0,2% +0,7% -3,4% market growth

Cloetta 15% 22% 33% 6% 41% share of market +0,4ppts +1,6ppts -0,4ppts +0,2ppts -0,1ppts

*In main markets, Nielsen/IRI data **Approx. 65% of Cloettas business is covered 36 Portfolio: enriching joyful consumer occasions

“after each ”kicking off meal” friend’s dinner” Other “welcome to the party!” Nuts 2% ”always with me” Gum 4% 6% Pastilles “enjoying 12% ”driving for holiday” mountain top view” Candy 58% Chocolate “prepping for 18% “breaking the ice – adventure” playing with flavors”

“let the weekend start” “let the movie begin” 37 Leading “choice for you” category Attracting new consumers

Red Band Range

Original -30% sugar Sugar free Veggie

• Successfully recruiting new consumers to the brand and category • 1/4 of shoppers new to candy bag segment 38 Accelerate Marketing Return On Investment

Step 1: make 70% of marketing Step 2: Maximize effective pure media spend visible to consumer 70% (boost hard, measure fast)

60% 60% 55%

45% 40% 40%

2017 2018 2019* Working Media % Non-Working Media % Linear (Working Media %)

* Ambition for 2019 *Nielsen 2018, Sweden 39 Accelerate Marketing ROI

Invest 70% of pure media on largest brands

Sisu ctivation

To come soon

Example: Example: Example: Venco

Venco Typical Dutch, Sisu, Finland Netherlands full media campaign full media campaign

9% Global renovation a & MS +16% Sell-out 40 Building scale and speed to market Ensure cross market growth

Navigate focus Re-shape Innovation • Category Strategies • New structure & capabilities to • Identifying future growth drivers ‒ Deliver incremental growth opportunities (aggregated) ‒ Be consumer driven & cross market relevant ‒ Bring more speed to market 41 Recipe to win Marketing: be consumer obsessed

• Do we really need to be younger and more digital? • Be curious, observant & think entrepreneurial The Perfect Factory

Marcel Mensink, President Operations 43 The Cloetta Production network

• A network of factories to deliver the highest serves and delivering the highest value.

New installation in Ljungsbro, 2018 44 New line in Turnhout 45 Creating Centers of Excellence Volume and technologies in 2018, tonnes

Nuts The Jelly Bean Factory

Gum, Lozenges & Hard boiled

Moulding, Extrusion, Hard boiled pastilles Toffees, Fudge, Nougat

Moulding

Moulding Moulded Foam, Chocolate Moulding & enrobing 46 Consolidated procurement Contract coverage to handle volatility

• 100 % of raw material, packaging, energy and third party (including pick & mix) is covered • 3rd party suppliers, including pick & mix managed centrally – creates synergies and aiming to develop limited strategic partners excluding branded products • Contract coverage differ by commodity and market 47 Insourcing progressing Significant Candyking and Italian volumes still to be insourced

• Candyking insourcing progressing well

– Estimated 4,8 ktons left to be insourced 2019-2020 kTons Candyking insourcing – Investing to be able to accelerate in 2020 and 2021 – Opportunity to insource further Candyking volumes • Opportunity to insource part of 6,0 ktons of Italian volumes – Estimated 1,3 ktons 2020-2021 – Italian Insourcing expected to speed up in 2021 • Partnership with selected key 3P’s *Opportunity to insource further Candyking volumes to generate – From 70 to 30 synergies beyond SEK 100m. Not confirmed. 48 The Perfect Factory From Lean 2020 to Cloetta Leading Performance Program

• The Lean 2020 program – launched in 2015 • The Perfect Factory programme aims to build Repeatable, Measurable and Capable lines and competent Employees. • In 2019 Cloetta will change the way we operate in Cloetta manufacturing with the start of Cloetta’s Leading Performance Program 49 Perfect Factory Cloetta Leading Performance Program

1 Standardized 2 Real time data tools Result

► Higher OEE Perfect factory ► Capacity increase ► Quality improvement 4 TRACC Sustainable effect ► Reduction of LTIR ► Predictability 3 5 ► Higher engagement Statistical Process Maintenance Control basics 50 Invest to grow Capacity investments needed

• 10% capacity increase in moulding technology

• Additional capacity will support – Growth in branded packaged products – Realization of additional Candyking synergies (insourcing) – Insourcing of volumes produced in previously Cloetta-owned Italian plants

• Investment approximately SEK 100m will debottleneck current lines in Turnhout and Levice

• New capacity will gradually be available from 2020 51 Financial strategy and road to 14% Frans Rydén, CFO 52 Pivot to profitable organic growth and targeted EBIT margin, adjusted

• Historic sales growth driven by acquisitions Background • Record of margin gains from synergy and factory restructuring • Solid cash flow and healthy leverage • Attractive dividend – doubled in 3 years

Change • Shift to organic growth with good fit acquisitions on top • Sustainable margin gains through cost control and addressing pick & mix

• Organic growth in line with market Outlook • Purposeful climb to targeted 14% EBIT margin, adjusted • Continued strong cash flow, leverage and dividends 53 Leverage and dividend on target Growth and margin trailing

2017 2018 Targets

1-2% Organic Growth* -1.2% -2.8% (In line with market)

EBIT Margin, Adj 10.4% 10.9% ≥ 14%

Net Debt / 2.4 2.3 EBITDA ≤ 2.5

Dividend Policy 54% 60% (share of profit) 40-60%

*Growth at constant exchange rates 54 Sales growth historically driven by acquisitions Shift to organic growth with selective acquisitions on top 6,2

SEKbn 0,5

0,1 0,3 1,1 0,2 4,9 -0,7

2012 Nutisal acquisition Jelly Bean Lonka acquisition Italy Disposal Candyking Forex, Other 2018 acquisition acquisition 2014 2014 2015 2017 2017 2012-2018 55 Good progress on branded growth in 2018 Offset by lost contract for pick & mix

Growth,% Branded business, % of total sales 10%

5% 2,4 0,0 0,1 1,3 0,6 1,6 1,4 0% -0,8 -2,4 72% -5% -2,7 -3,1 -4,0

-10%

-15% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4

20% 2016 2017 2018

Pick & mix business, % of total sales 12,9 10,5 10% 7,7 6,9 6,8 7,8 28% 1,5 0% -3,3

-10%

-13,5 -15,6 -20% -18,1 -19,4 56 Updated acquisition criterias set for good fit structural growth

• Sizeable targets that will generate scale and have impact on existing business Scale • Turnover ~ ≥ SEK 200m

• Product portfolio in at least one or more of our core categories Core categories • Branded business with low level of private label sales

• Footprint in existing core markets of Cloetta Core markets • Targets in adjacent markets is assessed based on relevance

Synergy realization and solid financial returns 57 Track record of margin gains through restructuring and synergies

Synergies and factory Candyking margin restructuring from Cloetta dilution, unfavorable LEAF merger FX, production cost SEKm 800 690 695 677 Margin 700 632 585 604 17,0% 600 432 500 14,0% Target 13,0% 400 13,6% 12,2% 300 12,0% 11,9% 10,9% 10,4% 200 9,0% 8,9% 100

0 * 5,0% 2012 2013 2014 2015 2016 2017 2018 Operating profit, adjusted Operating profit margin, adjusted

*From 2016 and onwards, Italy is discontinued operations and excluded from result 58 Well-stocked road-map to deliver targeted 14% EBIT margin, adjusted

EBIT margin, adjusted, %

Other value enhancing initiatives Reduce indirects • New and shared best • New program using practices, including on Perfect Factory ZBB methodology revenue management, • Cost efficiency through net productivity, portfolio ≥ 14,0% Branded growth Cloetta Leading and mix management • Scale and speed in Performance Program innovation • Continued insourcing Pick & mix portfolio • Marketing Return including Italian volumes • Candyking synergies on Investment • Pick & mix margin turn- 10,9% around • From volume to value creation Value Improvement Program+ 2018 Mid-term 59 Value Improvement Program Plus: New holistic and company-wide program to safeguard delivery of the roadmap

One program for value-creating initiatives, using industry-leading practices and grounded in Zero Based Budgeting principles • Transparency to confirm effort and money is spent where it matters the most to deliver profitable growth and targeted EBIT • Accountability for building blocks, with overlaps managed and no drill-sites missed • Rigor in tracking of actuals and fulfillment of commitments

To reduce indirect spend in SG&A and Operations, Cloetta has engaged Accenture for spend analysis and value targeting including benchmarking and best practices 60 Solid cash flow and healthy leverage

Cash flow Net debt/EBITDA ratio, x SEKm

1 000 927 6 889 900 813 4,9 792 5 800 697 712 4,2 700 4,0 628 4 600 532 492 500 3,0 500 3 408 2,4 2,4 Target 2,5 2,3 400 330 2 300 200 157 131 1 100 0 0 2012 2013 2014 2015 2016 2017 2018 2012 2013 2014 2015 2016 2017 2018 Cashflow from Operating activities, before changes in WC Cashflow from Operating activities 61 Capital allocation principles Supports growth and continues to prioritize dividends

• Increased investments in working media to fuel branded growth Invest for growth • Investment in production capabilities for growth and future insourcing

• Maintaining attractive dividend target of 40-60% of profit for the period Dividends • Maintaining attractive dividend target of 40-60% of profit for the period

• Footprint in existing core geographies and categories of Cloetta Targeted M&A • Clear objective of synergy realization and solid financial returns

• Keep stable debt ratio in line with target to maintain flexibility for M&A Repayment of debt 62 Cash Flow supports temporary step-up in CAPEX in 2019-2020 including Candyking insourcing

CAPEX/ Deprecation ratio 1,6 1,2 0,9 0,7 0,8 0,7 0,8

Temporary step-up, including 350 5,5% announced Candyking 6,0% integration CAPEX* 300 5,0% 4,3% ~5,0% 250 269 3,5% 4,0% 3,3% 200 211 3,0% 2,8% 2,7% 3,5% 186 184 3,0% 150 170 161 157 2,0% 100

50 1,0%

0 0,0% 2012 2013 2014 2015 2016 2017 2018 20192019-2020 CAPEX CAPEX/Sales

*Part of the previously announced Candyking integration cost of SEK 175m 63 Attractive dividend – doubled in 3 years

0,0 0,0 0,0 0,50 0,75 0,75 1,00 Dividend per share, SEK 70%

60% 60% Target 53% 54% Dividend payout 50% of 40–60 per cent of profit for 40% 37% the period

30%

20%

10%

0 0 0 0% 2012 2013 2014 2015 2016 2017* 2018

* 2017 excluding special dividend 64 Pivot to profitable organic growth and targeted EBIT margin

• Historic sales growth driven by acquisitions • Record of margin gains from synergy and factory restructuring Background • Solid cash flow and healthy leverage • Attractive dividend – doubled in 3 years

• Shift to organic growth with good fit acquisitions on top Change • Sustainable margin gains through cost control and addressing pick & mix

• Organic growth in line with market Outlook • Purposeful climb to targeted 14% EBIT margin, adjusted • Continued strong cash flow, leverage and dividends Q&A Summary Henri de Sauvage-Nolting 67 Key Business Priorities Cloetta to organic growth and 14% EBIT margin, adjusted

• Branded business grew +1,5% at 14%+ EBIT in 2018 Branded growth • Four consecutive quarters of growth in 2018

Pick & mix to • Pick & mix delivers 1-2% EBIT margin, adjusted • Solve profitability issues in Sweden ~ SEK -60m EBIT sustainable in 2018 value • Synergy realization and insourcing

• Value Improvement Program+ Reduce costs and • Factory efficiency improvements Drive efficiency

69 Disclaimer

• This presentation has been prepared by Cloetta AB (publ) (the “Company”) solely for use at this presentation and is furnished to you solely for your information and may not be reproduced or redistributed, in whole or in part, to any other person. The presentation does not constitute an invitation or offer to acquire, purchase or subscribe for securities. By attending the meeting where this presentation is made, or by reading the presentation slides, you agree to be bound by the following limitations. • This presentation is not for presentation or transmission into the United States or to any U.S. person, as that term is defined under Regulation S promulgated under the Securities Act of 1933, as amended. • This presentation contains various forward-looking statements that reflect management’s current views with respect to future events and financial and operational performance. The words “believe,” “expect,” “anticipate,” “intend,” “may,” “plan,” “estimate,” “should,” “could,” “aim,” “target,” “might,” or, in each case, their negative, or similar expressions identify certain of these forward-looking statements. Others can be identified from the context in which the statements are made. These forward-looking statements involve known and unknown risks, uncertainties and other factors, which are in some cases beyond the Company’s control and may cause actual results or performance to differ materially from those expressed or implied from such forward-looking statements. These risks include but are not limited to the Company’s ability to operate profitably, maintain its competitive position, to promote and improve its reputation and the awareness of the brands in its portfolio, to successfully operate its growth strategy and the impact of changes in pricing policies, political and regulatory developments in the markets in which the Company operates, and other risks. • The information and opinions contained in this document are provided as at the date of this presentation and are subject to change without notice. • No representation or warranty (expressed or implied) is made as to, and no reliance should be placed on, the fairness, accuracy or completeness of the information contained herein. Accordingly, none of the Company, or any of its principal shareholders or subsidiary undertakings or any of such person’s officers or employees accepts any liability whatsoever arising directly or indirectly from the use of this document.