Presentation for NCA

1. Winning the Confectionery Consumer March 5, 2009 Todd Hale SVP Consumer & Shopper Insights James Russo Vice President Marketing

4. Overheard Across the Globe… Source: Nielsen DeltaQual: Qualitative Feedback from around the globe, 4Q2008 I now go to Aldi’s. It’s so cheap my girlfriends have also changed, so it’s not just me… Also I buy the cheapest in everything except foods & shampoo Down trading on stores & brands We eat out less & cook more … still buy chocolate & wine though The Netherlands Struggling for a sense of normality We watch more movies at home, more board games – I bake a lot more. It’s really hard to eat healthy though, when you are trying to save money More cocooning in home Controlling usage- Back to basic, familiar brands I try not to stock up. Just buy what I need for the month… Across countries I buy more frozen foods… I can control how much I use & I don’t waste anything UK I used to have 2 cups of coffee at Starbucks everyday. I’ve stopped that as well as my weekly manicure. The Latte Effect I make inventories of what’s in the kitchen & try to use everything I have before buying more. I wait for the sales & stock up. Depleting Inventories Lateral shifts in categories I don’t experiment with new items… which I used to before. I just buy something familiar.. Across countries

6. Weakening Labor Market: Over 3.5 Million Job Losses Since Dec 2007 U.S. Total Non Farm Employment (Seasonally Adjusted Change from Previous Mos) Unemployment surges to 7.6%; highest monthly loss since 1974

7. How Are Consumers Reacting?

8. Declining Consumer Confidence: Current Expectations at Record Lows: Feb Plummets Source: The Conference Board – Nine census regions, 5,000 US households 2001 2002 2003 2004 2005 2006 2007 2008 Recession, 9/11 Corp Scandals War War Rebound Spike In Gas prices Huge job gains Fall in gas prices Housing, Energy, Credit, Economy Katrina

9. More At-Home Meal Preferences Source: Homescan®, a service of The Nielsen Company – Panel Views Survey

10. Retail Sales Stalled in 4 th Quarter of 2008 Source: Dept of Commerce: % Chg vs. previous year % change in retail sales (ex-auto) 2008 2007 2006 2005 2004 2003 2002 2001 1999 Sep vs prior month Oct Nov Dec Jan +1.0%

11. Same Store Sales Reflect Consumer Actions Targe t Nordstrom JCPenney Home Depot Kohls Stock Up & Save Discretionary Spending Value & Convenience Source; Jan ‘09 results (excl fuel) for all but Kroger, Safeway, SuperValu, Dollar General, Family Dollar, Dollar Tree, CVS, Whole Foods, Home Depot – latest report Same Store Sales Growth Latest Reported Quarter Carrefour +3.2% Metro C&C +3.2% Delhaize U.S. + 2.5% Delhaize Belgium + 2.2% Loblaws + 3.0% SuperValu Macys Whole Foods

12. What Are Consumers Doing Differently? Page TH

13. Behavioral Shifts are Gradual & Immediate Trips to value channels growing since 2001 Coupon Usage increasing PL unit sales outpacing Branded Source: Nielsen Homescan and RMS, Label Trends, Nielsen Online through Sept. Nielsen Entertainment through Sept, PL 11/1/08 Consumers increasingly using internet to find ways to save H&W slowing, but still strong TV viewing up; movie going flat

14. Dramatic Declines in Discretionary Trips 2008 versus 2007 Percent Change Trip Generators Trip Avoiders Source: Homescan®, a service of The Nielsen Company Excludes gas only trips

15. Low Income Taking More Drastic Trip Cuts, More Affluent Driving Trips to Value Channels Source: Homescan®, a service of The Nielsen Company Excludes gas only trips Shopping Trips by Household Income 2008 versus 2007 Percent Change

16. Good Start to 2009, but 1 st Period in ’09 Includes Two Additional Days Before New Years Eve Trip Generators Trip Avoiders Source: Homescan®, a service of The Nielsen Company Excludes gas only trips % Change in Shopping Trips

17. Edible Departments Driving Dollar Growth Source: Scantrack, a service of The Nielsen Company ; (FDM w/ Walmart) 52 weeks ending 01/24/09 (versus prior year)

18. Unit Sales Off 1.5% Across the Store – Largest Declines from Non-Edibles, Candy & Gum Inflation & weakening economy driving consumers to make trade-offs or buy less Source: Scantrack, a service of The Nielsen Company ; (FDM w/ Walmart) 52 weeks ending 01/24/09 (versus prior year)

19. Worsening Sales in Recent Quarter & 4-week Period as Inflationary Pricing Eased Latest Unit prices for fresh eggs & milk down 12% & 8% in latest period Source: Scantrack, a service of The Nielsen Company ; (FDM w/ Walmart) 52 weeks ending 01/24/09 (versus prior year)

20. Sales Within Non-Edibles, Candy & Gum Leading Unit Decline Latest Total Dairy Fresh Meat Deli Fresh Produce Alco Bev Dry Grocery Frozen Pkgd Meat HBA Non Food General Merch Source: Scantrack, a service of The Nielsen Company ; (FDM w/ Walmart) 52 weeks ending 01/24/09 (versus prior year) Gum Candy

22. Consumers Increasingly Turning to Store Brands as Economy Weakens Total Store Brand Items Avg Unit Sales Growth: 4.5% Driver of growth: Consumables Departments: Fresh Produce, Bev-AL, Fresh Meat, Frozen Foods, Deli, Dairy, Dry Grocery Store Brands Branded Total Branded Items Avg Unit Sales Declines: -3.6% Driver of decline: Discretionary Departments: General Merchandise, Non- Food, HBA & Many Food Departments % Unit Sales Growth for last 6 (4wk) periods Source: Scantrack, a service of The Nielsen Company ; (FDM w/ Walmart) 52 weeks ending 01/24/09 (versus prior year)

23. Retailers & Manufacturers Facing Significant Decisions Page JR

27. Impact on Advertising Page

28. Media Shifting: Decline in Ad Spending Widening Page Source: Nielsen Monitor-Plus (Jan.-Sept 2007 and Jan.-Sept 2008). - Internet advertising expenditures account for CPM-based, image-based advertising. Cable TV Syn. TV Hisp Cable TV FSI Local Mag Spot Radio Nat Mag Total Ad Spending Nat Newspr Hisp TV In- ternet Net- work radio Nat Sun Supp Spot TV Out- door B2B Local Newspr Local Sun Supp Jan – Sept 2008 vs. YAGO Next > < Back Main Menu 19% Of Tlt 2% 1% .2% 4% 17% .4% .3% 2% 3% 1% 14% 6% 1% 3% .4% .07%

29. Top 10 US Categories Source: Nielsen Monitor-Plus (Jan.-Sept 2007 and Jan.-Sept 2008) 0% Furniture Stores 9% Restaurant 27% Direct Response Product 8% Department Store 0% Wireless Telephone Services 1% Motion Picture 11% Quick Service Restaurants -3% Auto Dealerships – Local -4% Pharmaceutical -8% Automotive (Factory & Dealer Assoc) % Change Product Category

30. Top 10 US Companies Source: Nielsen Monitor-Plus (Jan.-Sept 2007 and Jan.-Sept 2008) -3% PepsiCo 19% General Electric -11% Time Warner 5% Johnson & Johnson -23% Ford Motor -4% Toyota Motor 10% Verizon Communications -2% AT&T -4% General Motors -7% Procter & Gamble % Change Product Category

31. Which Levers Do You Pull? Analytics & Insights TH Packaging Pricing Private Label Promotion Advertising In-Store Assortment Innovation

32. Consumers Generally Prefer Larger Sizes with Lower Price per Serving Source: Homescan®, a service of The Nielsen Company – Panel Views Survey

33. Retailer Brand $ Share Varies by Department 16.6% AVG ( + 1.0 pts) > Development in food & beverage; share growth in all dept’s but Bev/Al (+1.1 +1.0 +1.2 +0.5 +0.9 +1.7 +0.7 +0.9 +0.2 +0.2 -0.1) Source: Scantrack, a service of The Nielsen Company ; (FDM w/ Walmart) 52 weeks ending 01/24/09 (versus prior year) +0.2 0.0

34. Retailer Brand Unit Share Varies by Department 20.9% AVG ( + 0.9 pts) > Development in food & beverage; share growth in all dept’s but Bev/Al Source: Scantrack, a service of The Nielsen Company ; (FDM w/ Walmart) 52 weeks ending 01/24/09 (versus prior year) (+1.4 +1.1 +0.9 +0.8 +0.3 +0.8 +0.3 +0.5 +1.3 +0.3 0.0 0.0) +0.5

35. Stronger $ Growth from Store Brands & Overlap in Four Mega-Categories Categories on both lists Non-edible Categories Top 15 Fastest Growing Categories (% $ Change) Food dominates both lists Source: Scantrack, a service of The Nielsen Company ; (FDM w/ Walmart) 52 weeks ending 01/24/09 (versus prior year) –*minimum $100 million in sales Store Brands* Branded* 19% Canned Vegetables 8% Car Accessories 19% Fresh Produce 8% Shortening & Oil 21% Frozen Pizza & Snacks 8% Baking Mixes 21% Syrup & Molasses 8% Fresh Meat 22% Detergents 9% Dry Mix Prepared Foods 22% Coffee 9% Yogurt 23% Crackers 10% Fresh Eggs 23% Cheese 11% Pet Food 29% Salad Dressings & Mayo 11% Cough & Cold Remedies 31% Baby Food 12% Butter & Margarine 34% Frozen Breakfast Foods 14% Season Gen Merchandise 36% Dry Vegetables & Grains 19% Canning & Freezing Supplies 37% Shortening & Oil 22% Pasta 40% Pasta 24% Dry Vegetables & Grains 60% Flour 25% Flour

36. Stronger Unit Growth from Store Brands & Minimal Duplication in Categories Top 15 Fastest Growing Categories (% Unit Change) Categories on both lists Non-edible Categories Non-edible success for Store Brands Source: Scantrack, a service of The Nielsen Company ; (FDM w/ Walmart) 52 weeks ending 01/24/09 (versus prior year) –*minimum $100 million in sales Store Brands* Branded* 8% Salad Dressings & Mayo 1% Pasta 9% Canned Vegetables 1% Baking Supplies 9% Coffee 2% Packaged Milk & Modifiers 9% Nuts 2% Liquor 10% Cheese 2% Dressing, Salad, Prep Foods 11% Frozen Pizza & Snacks 2% Bottled Water 11% Ice Cream 2% Dry Vegetables & Grains 11% Fresh Produce 3% Frozen Novelties 11% Breakfast Foods 3% Refrigerated Juices & Drinks 11% Detergents 4% Puddings/Desserts - Dairy 12% Shortening & Oil 4% Dry Mix Prepared Foods 12% Frozen Breakfast Foods 4% Fresh Meat 22% Flour 6% Vitamins 24% Candles & Incense 7% Wine 47% Baby Food 11% Canning & Freezing Supplies

40. What To Watch Page JR

41. Developments Which Could Help Avert Deep Recession Decreasing Demand for Crude Oil Since July Highs: Crude -73% Retail Gas -53% Aggressive Fiscal and monetary policy Sources: EIA, Euro: Belgium, France, Germany, Italy, Netherlands, UK S&P GSCI returns qtr 2/11/09 Strengthening U.S. Dollar Dollar vs. Euro: +25.13% Decreasing Commodity Prices Latest 3 mths Agri -2% Indust. Metals -22% Live- stock -9%

45. 2009 Convenience Channel Industry Forecasts Categories to Watch in 2009: Forecasted % Change in 2009 Dollar Sales Candy Tobacco Beverages SNKS CSNews Industry Forecast Study

46. The Chocolate Candy Category: Impacted by Higher Pricing & Economic Pressures Eco Conditions Worsen Source: Scantrack, a service of The Nielsen Company ; FDM excluding Walmart + C-Stores

47. The Premium Chocolate: The “Wave” Has Crashed as Unit Decline in Latest Periods Source: Scantrack, a service of The Nielsen Company ; FDM excluding Walmart + C-Stores

48. Dark Chocolate: Signs of Leveling Off After Two Years of Strong Growth $290M $816M $746M $517M $370M $327M +9.4% +44.3% +39.7% Source: Scantrack, a service of The Nielsen Company ; FDM excluding Walmart + C-Stores

49. Chocolate Singles: Unit Sales Continued Declines As Pricing Increases Source: Scantrack, a service of The Nielsen Company ; FDM excluding Walmart + C-Stores

50. The Outlook Page

51. Leading Indicators Remain Near Record Lows: Near term recovery (3-6 mths) not expected Page Positive Neutral Negative Sources: U.S Leading Economic Indicators Next > < Back Main Menu Mar-08 Apr-08 May-08 Jun-08 Jul-08 Aug-08 Sep-08 Oct-08 Nov-08 Dec-08 Jan-09 Feb-09 Mar-09 Index of Leading Indicators: Composite of ten indicators Equity Markets (Dow, NASDAQ, S&P) Consumer Expectations Index Building Permits New Factory Orders Capacity Utilization Productivity: Output per man-hour worked Weekly Jobless Claims: 4 wk moving avg Avg weekly hours worked Help wanted Ad Indexes

52. Page Rising unemployment & declining consumer expenditures has US economy in worst shape in at least a quarter century As economy stalls, consumers shifted to store brands, while reducing their spending per trip 2008 2009(E) 2010 (E) GDP 1.3% -1.2% 2.2% Consumer Spending 0.3% -1.6% 1.9% Inflation Rate 3.8% 0.1% 2.3% Unemploy. Rate 5.8% 8.0% 8.1% Savings Rate 1.7% 5.1% 5.2% USA Summary Jul 08 Aug 08 Sept 08 Oct 08 Nov 08 Dec 08 Jan 09 Feb 09 Mar 09 Apr 09 May 09 Jun 09 Nielsen Market Index Volume* Nielsen Market Index Value** Are consumers moving to Store Brands? Are shoppers shifting to value channels? Are retailers selling more on promotion? Are consumers shopping more frequently? Are consumers spending more per trip? Nielsen Global Consumer Confidence^

53. What to Do Now Page TH

54. Not All Shoppers Use the Same Coping Strategy During Down Economy Source: Homescan®, a service of The Nielsen Company 52 weeks ending 12/27/08 Economic Impact Shopper Segments

55. Category Sales Opportunities to Win in Down Economy Varies by Segment $ Buying Rate Index Source: Homescan®, a service of The Nielsen Company 52 weeks ending 12/27/08 107 104 101 116 96 90 97 98 Candy 86 66 91 103 101 87 109 119 Wine 110 88 97 103 102 96 100 103 Gum Panic Stricken Disloyal/Promotion Sensitive Switch Stores for Deals Stock-up & Save Light Coupon & Sales Switch to Private Label Recession Insensitive Recession Indifferent Nielsen Economic Impact Segmentation:

56. Promotion Support Required to Win in Down Economy Varies by Segment $ Buying Rate Index Deal Index Source: Homescan®, a service of The Nielsen Company 52 weeks ending 12/27/08 133 106 120 153 113 44 73 80 Candy 107 104 101 116 96 90 97 98 Candy 86 66 91 103 101 87 109 119 Wine 110 88 97 103 102 96 100 103 Gum 77 80 119 105 127 44 85 114 Wine 128 Panic Stricken 124 Disloyal/Promotion Sensitive 124 Switch Stores for Deals 155 Stock-up & Save 117 Light Coupon & Sales 46 Switch to Private Label 66 Recession Insensitive 73 Recession Indifferent Gum Nielsen Economic Impact Segmentation:

58. Nielsen Economic Advisor: What You Need To Know March 5, 2009 Todd Hale, SVP, Consumer & Shopper Insights James Russo Vice President, Marketing

59. Thank You