Nestl Pakistan

Nestl Pakistan Ltd is a subsidiary of Nestl S.A. - a company of Swiss origin headquartered in Vevey, Switzerland. It is a food processing company, registered on the Karachi and Lahore stock exchanges and operating in Pakistan since 1988 under a joint venture with Milk Pak ltd and took over management in 1992. For ten years in a row, the company has won a place among the top 25 companies of the Karachi Stock Exchange. Headquartered in Lahore, the Company operates four production facilities. Two of its factories in Sheikhupura and Kabirwala are multi product factories. One factory in Islamabad and one in Karachi produce bottled water. Through its effective marketing and a vast sales and distribution network throughout the country, it ensures that its products are made available to consumers whenever, wherever and however. Nestl Pakistan operates in many ways but people, products and brands are the main flag bearers of the Companys image, and we continue to enhance the quality of life of people. Nestl Pakistan now operates the biggest milk collection operation in Pakistan, Currently, Nestl Pakistan collects milk from an estimated 190,000 farmers spread over 145,000 sq Km's in the province of Punjab and Sindh. Nestl believes in creating shared value and is committed to the communities it works and lives with. In Pakistan, the company is working closely with the communities in areas related to Nutrition, Water and Rural Development, and continues to enhance the quality of life of people throughout its value chain. Nestl Pakistan today is the leading Food & Beverages Company in Pakistan with key focus on Nutrition, Health and Wellness and reaching the remotest of locations throughout Pakistan to serve the consumers. Nestl Pakistan also prides itself in being the leaders in Nutrition, Health & Wellness. Ever since 1867, when Henri Nestl invented the first infant food, nutrition has been in our DNA. Today more and more consumers mirror our emphasis on nutrition, as they realize that food choices affect their health and quality of life. The companys strategy is guided by Nestls Corporate Business Principles which are in line with internationally accepted best practices and ethical performance culture. Nestls existing products grow through innovation and renovation while maintaining a balance in geographic activities and product lines. Long-term potential is never sacrificed for short-term performance. The Companys priority is to bring the best and most relevant products to people, wherever they are, whatever their needs are, and for all age groups. In line with Nestls global philosophy, Nestl Pakistan is proud of its commitment to excellence in product safety and quality and to providing value and aims to be the leading Nutrition, Health and Wellness company. As a socially responsible corporate, we always focus on environment friendly operations, ethical business practices and our responsibility towards the communities.

Our Vision
Nestls global vision is to be the recognized leading Nutrition, Health and Wellness Company. Nestl Pakistan subscribes fully to this vision of being the number one Nutrition, Health, and Wellness Company in Pakistan. In particular, we envision to; Lead a dynamic, passionate and professional workforce proud of our heritage and positive about the future. Meet the nutrition needs of consumers of all ages from infancy to old age, from nutrition to pleasure, through an innovative portfolio of branded food and beverage products of the highest quality.

Deliver shareholder value through profitable long-term growth, while continuing to play a significant and responsible role in the social, economic, and environmental sectors of Pakistan.

Our Mission
To positively enhance the quality of life of the people of Pakistan by all that we do through our people, our brands and products and our CSV activities.

Our Ambition
To be the leading Nutrition, Health and Wellness Company in Pakistan.

Associated Companies
Serial # Name of Associated Company 1 Nestl S.A 2 La Vie Limited Liability Company 3 Nestl Iran (Private Joint Stock Company) 4 Nestl Lanka PLC 5 Packages Limited 6 IGI Insurance Limited 7 Wazir Ali Industries Limited 8 H.Y. Enterprises 9 Pakistan Dairy Association 10 National Fertilizer Corporation of Pakistan Pvt. Ltd. 11 Alpha Insurance Company Limited 12 Safe Concrete Products Limited 13 Dairy & Rural Development Foundation 14 Sanofi-Aventis Pakistan Limited 15 Tri-Pack Films Limited 16 International Steel Limited 17 WWF-Pakistan 18 Babar Ali Foundation 19 National Management Foundation 20 India-Pakistan Chamber of Commerce & Industry 21 Ali Institue of Education Syed Maratib Ali Religious & Charitable Trust 22 Society 23 Internation Chamber of Commerce (ICC) Pakistan 24 Lahore University of Management Sciences Weblink www.nestle.com www.laviewater.com/congty_e.htm www.nestle.ir www.packages.com.pk www.igiinsurance.com.pk www.wazirali.com.pk www.pddc.com.pk www.nfc.com.pk www.alphainsurance.com.pk www.safemixlimited.com www.sanofi-aventis.com.pk www.tripack.com.pk www.isl.com.pk www.wwfpak.org www.baf.org.pk

www.aie.edu.pk

www.iccpakistan.com.pk

Nestl Global
Today, Nestl is a global leader in health, nutrition and wellness. Consumers around the world, from village squares in Nigeria to the skyscrapers of New York and Chicago, are united by the Nestl promise

of quality, taste, nutrition and convenience. Though headquartered in Vevey, Switzerland, we now have factories or operations in almost every country, employing around 280,000 people. In 2008, our global sales reached CHF 108 billion.

Our operations are spread across three global zones covering Europe, the Americas, Asia, Oceania and Africa. Recognizing that every region has its special needs, the three zones operate locally, but are united by a common vision and priorities. The voices of even the smallest local markets are heard at our headquarters in Vevey, Switzerland. Our immense popularity comes from our efforts to develop products that give quality and nutritional benefits at low prices, even in the most remote regions. We distribute using local means; in Madagascar, for instance, backpacker salesmen sold over 12 million MAGGI tablets within six months, an approach that was duplicated in Pakistan and Mozambique. Our consumers know that they can rely on us to be there when we are needed.

Corporate Social Responsibility

Our presence in the community is not restricted to making Nestl products available to consumers; it brings with it a responsibility to those around us. In China and Pakistan, we provide animal husbandry assistance to thousands of farmers. In Brazil, our food education programme has trained hundreds of volunteers to teach families about nutrition, health and hygiene. And in India, we finance and oversee the provision of clean water at village schools near our factories, benefiting some 20,000 children.

Good Food, Good Life

Henri Nestl chose his own coat of arms to represent the company's philosophy: a bird's nest, with a mother feeding her young. The image represents our core values: care, family values, nutrition, healthy

growth, safety and comfort. It is a guarantee of quality and a commitment to our responsibilities as a food company and experts in nutrition. Over the years we have reaffirmed our commitment to wellness, helping our consumers to live longer, healthier, and more productive lives, no matter their age, gender or socioeconomic status.

Good Ingredients
Three vital ingredients lie at the heart of Nestl and come together in our brands: our people, our research and development, and our commitment to quality. The dedicated people who make up the Nestl family are our source of strength and energy. Realising this, we offer them constant professional development, and feel our cultural diversity is one of our greatest assets. Today, we are one of the largest investors in food technology. R&D is the cornerstone of the Nestl guarantee of quality. We consider quality in three key dimensions: health, sensory pleasure, and social applicability. Thus we try to provide nutritious, tasty meals that offer value and are culturally relevant.

Good Practices
As the world changes, we at Nestl evolve and adapt to new circumstances and environments. Nevertheless our business practices are founded on certain tenets that reflect the basic ideas of fairness, honesty, and concern for people. We are committed to the following business principles in all countries, taking into account local legislation, cultural and religious practices: Nestl's business objective is to manufacture and market the Company's products in such a way as to create value that can be sustained over the long term for shareholders, employees, consumers, and business partners. Nestl does not favour short-term profit at the expense of successful long-term business development. Nestl recognises that its consumers have a sincere and legitimate interest in the behaviour, beliefs and actions of the Company behind brands in which they place their trust, and that, without its consumers, the Company would not exist. Nestl believes that, as a general rule, legislation is the most effective safeguard of responsible conduct, although in certain areas, additional guidance to staff in the form of voluntary business principles is beneficial in order to ensure that the highest standards are met throughout the organisation. Nestl is conscious of the fact that the success of a corporation is a reflection of the professionalism, conduct and the responsible attitude of its management and employees. Therefore, recruitment of the right people and ongoing training and development are crucial.

Supply Chain

Nestl Pakistan's supply chain makes sure that Nestl products are available, no matter where you are in Pakistan. We integrate processes from the farm to markets, and ensure products are delivered to you at the right time, the right cost and in the right quantities. In the first quarter of 2006 alone, we delivered an astonishing 136 million kg of Nestl products in Pakistan. Supply chain was established as a separate department in 2001. Since then, we've achieved a number of milestones, including a cold-chain in 2002, centralised demand and supply planning in 2003, and implementation of GLOBE in 2005. We were selected for a Best in Class repository study, and three of our best practices were subsequently incorporated into the Best Practices Library. Our mission is to: Optimise and consolidate resources and processes for a low- cost but efficient execution Develop and manage simplified and effective supply network to achieve a high level of service Create a continuous improvement culture driven by performance measures and reward

Corporate Governance Principles

We are dedicated to following the best practices laid down by our parent company, Nestl SA. We have implemented the Corporate Governance Principles established by Nestl SA, covering four core areas: Rights and responsibilities of shareholders Equitable treatment of shareholders Duties and responsibilities of the board of directors Disclosure and transparency

Corporate Internal Audit

Recognising the need to maintain transparency and verify the application of corporate standards, Nestl Pakistan has established an internal audit department that monitors administrative and operational functions throughout the company. Thanks to its operations, we can be assured that adequate internal controls are in place, management information is reliable, resources are used effectively, and company assets are safeguarded.

GLOBE Launch in Pakistan

On 7 February 2005, the System Application Products (SAP) implementation project was successfully concluded in Pakistan. All Nestl Pakistan sites, including the head office, factories, distribution centres and zonal sales offices,

migrated to SAP, a state-of-the-art information technology system. The Nestl Pakistan GLOBE team helped streamline almost every area of operation, allowing the company to become more efficient as well as more consumer-focused. With Nestl Pakistan growing at its present high rate, the successful implementation of the GLOBE programme has improved our business processes, operational efficiency and communication/IT infrastructure. We can now focus on ensuring a better level of service, and providing satisfying and healthy products for our consumers, for many years to come.

Our Factories
Our products are manufactured in five facilities scattered around the country, from Islamabad in the north, to Karachi in the south. Two state-of-the-art multipurpose factories are located in the agricultural heartland of the Punjab, and the remaining three are dedicated to producing our trusted brands of bottled water. As citizens of Pakistan, we consider it our duty to make sure that our manufacturing processes are clean, hygienic and safe. We are constantly working to reduce emissions at our factories, reducing and treating wastewater, and making our packaging environmentally friendly.

Regular audits have confirmed that our factories' environmental management meets the Nestl international standard. As is the Nestl policy around the world, we care for our people. We uphold the principles of the UN Global Compact and encourage women to participate.

Sheikhupura Factory
At the very heart of the Punjab's major milk district stands our Sheikhupura factory, a vast state-of-the-art operation that produces many of our most popular products such as MILKPAK UHT milk, low-fat highcalciumNESVITA products, NESTL PURE LIFE water, CERELAC and yogurt. The factory commenced operations as part of Milkpak Ltd in 1981. At the time it produced only UHT milk, but by 1988 had expanded to produce butter, cream and ghee, as well as fruit drinks. In 1988, it became part of the joint Milkpak venture, and, soon after, NIDO milk powder started being produced here. As the needs of Pakistani consumers grew, we added the capacity to manufacture new products. In 1998 we started supplying dairy mixes to McDonald's. A plant to produce the popular Nestl NESTL PURE LIFE bottled water was also commissioned. In recent years, the plant's capacity has been enhanced to

produce fruit yoghurt, tea whitener, cream and raita, as well as low-fat, high-calcium dairy products, sold under the NESVITA brand.

Kabirwala Factory
In 1990, Milkpak acquired the Kabirwala factory, located in Khanewal district of the Punjab, as a subsidiary. By 1997 it was a fully owned unit of Nestl Pakistan Ltd. Soon after it was acquired, we began upgrading its capacity. In 1992 we added aMAGGI Noodles plant was added and 1996 saw an additional of a milk powder. Over the years, the Kabirwala factory was constantly enhanced. EVERYDAY tea whitening powder was introduced in 2002 and revolutionised tea and coffee drinking in homes and offices around the country. In 2005, the factory continued to make notable achievements. 2006 has seen the commencement of Kabirwala Extension Project that would be completed in April 2007 at a cost of about Rs. 4.0 billion. The project has seen expansion of milk processing capacity to triple its current size, both for powder and liquid. The factory Is also currently producing Nido (started in 1998) and Milkpak UHT (started in 2006).

Islamabad Factory
In 2001 we acquired the AVA water factory in Islamabad. It became a fully owned unit in 2003, and we immediately instituted a programme of major improvement to bring the facility on par with international standards. Over the years, better and more efficient machinery has been introduced. This has helped us speed up production, and provide our consumers with their favourite brands of bottled water in convenient package sizes. We are proud that the Islamabad factory has made efforts to bring Pakistani women into the workforce, by providing a comfortable and enabling work environment. Indeed, we were amongst the first to employ female operators working alongside men in our production department.

Human Resource

The Human Resource department is dedicated to our employees, and ensures that we have all the right people with the right skills, in the right places at the right time. Understanding that our people are the bedrock of all our business strategies, it is our mandate to enhance their skills with cutting-edge training and provide them with world-standard facilities. We select flexible, innovative people who are ready to confront new challenges and make a difference. Our ground-breaking Management Trainee Programme aims to develop talented young men and women and help them achieve their potential in a dynamic and enabling environment. Over a hundred people travel abroad every year to take advantage of our international training and development events.

Investor Information
Auditors
KPMG Taseer Hadi & Co. Chartered Accountants

Legal Advisors
Cheema & Ibrahim Advocates

Bankers
Faysal Bank Limited Citibank N.A. Deutsche Bank A.G. Habib Bank Limited MCB Bank Limited Standard Chartered Bank (Pakistan) Limited United Bank Limited National Bank of Pakistan Limited Allied Bank Limited Barclays Bank Limited Bank Al Habib Limited The Hongkong and Shanghai Banking Corporation Limited

Creating Shared Value

What is Creating Shared Value? Creating Shared Value is the basic way we do business, which states that in order to create long-term value for shareholders, we have to create value for society. But we cannot be either environmentally sustainable or create shared value for shareholders and society if we fail to comply with our Business Principles. This involves compliance with national laws and relevant conventions, as well as our own regulations, which often go beyond our legal obligations. For example, we support the Universal Declaration of Human Rights (UDHR), which stands at the basis of the UN Global Compacts Human Rights Principles. Our strong support for the UN Global Compact, and our detailed commitments to the Fundamental Conventions of the International Labour Organisation (ILO) or other relevant instruments, are laid out in our Nestl Corporate Business Principles and related policy documents, and their application is verified through our CARE programme and our internal Corporate Group Auditors. Beyond that, how we do business is based on sustainability - ensuring that our activities preserve the environment for future generations. In line with the Brundtland Commission's definition, sustainable development to Nestl means "development that meets the needs of the present without compromising the ability of future generations to meet their own needs".

At the same time, Creating Shared Value goes beyond compliance and sustainability. Any business that thinks long-term and follows sound business principles creates value for shareholders and for society through its activities, such as, in terms of jobs for workers, taxes to support public services, and economic activity in general. But Creating Shared Value goes one step further. A company consciously identifies areas of focus, where: a) shareholders interest and societys strongly intersect, and b) where value creation can be optimised for both. As a result, the company invests resources, both in terms of talent and capital, in those areas where the potential for joint value creation is the greatest, and seeks collaborative action with relevant stakeholders in society. At Nestl, we have analysed our value chain and determined that the areas of greatest potential for joint value optimisation with society are Nutrition, Water and Rural Development. These activities are core to our business and vital to the welfare of the people in the countries where we operate. Nestl Prize in Creating Shared Value

Starting in 2010, the Nestl Prize in Creating Shared Value will be awarded every other year to encourage and reward an outstanding innovation or project in the areas of water, nutrition or rural development. For more details visit the global web page for Nestl Prize in Creating Shared Value. Creating Shared Value Advisory Board To increase our positive impact on society, the Nestl Creating Shared Value Advisory Board met for the first time in April 2009. The Board members, all internationally recognised experts in corporate strategy, nutrition, water and rural development were appointed for three years to act as direct advisors to the Nestl Chairman and CEO. The board meets twice a year to advise the Nestl Chairman and CEO on development of the CSV concept, the Nestl value chain and the potential actions to be taken, as well as select the winner of the Nestl Prize in Creating Shared Value.

The Nestl Difference

At Nestl you'll find yourself in a dynamic and invigorating environment, surrounded by people who are passionate about their work. You'll feel empowered to contribute to the company's business objectives and to achieve your own personal and professional goals. You and your colleagues shape and lead the organisation your energy is its greatest strength.

What Will Make You Right for Nestl?

A Nestl employee is characterised by creativity and dynamism. We don't only look for specialists, but people who have knowledge and skills in more than one field, with broad interests. To sum up, we want people with purpose and ambition, though not at the expense of others. We want people who take responsibility for their actions, who consider Nestl their own business, and who show an entrepreneurial spirit. If you think you fit the Nestl profile, you might be just the person we're looking for!