# A Message to our Shareholders

_Source: `DeepSeekOCR_Ardian_pruned_1k/consumer-defensive-packaged-foods/NYSE_INGR_2020/NYSE_INGR_2020.mmd` · pages 3-9_

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A Message to our Shareholders

Ingredion rose to the incredible challenges in 2020, delivering a year of continued specialties growth, strategically strengthening our portfolio and displaying momentum in our financial performance as we exited the year. We remained guided, united and inspired by our purpose of bringing the potential of people, nature and technology together to make life better as we fulfilled our role as an essential business, employer of choice and responsible neighbor. We moved swiftly and decisively to protect our employees' health and safety, maintain business continuity for our customers and make strategic investments aligned with our Driving Growth Roadmap for long-term value creation. We are very proud of our employees, who displayed agility and resilience while safely operating our facilities and ensuring product quality and availability during this unique year.

## Ingredion COVID-19 Priorities

1. Maintaining the health and safety of our employees

2. Business continuity planning for our customers

3. Proudly serving our communities

## 2020 Financial and Operating Performance

Our 2020 financial results include reported and adjusted operating income of \(582 million and \)659 million, respectively, and reported and adjusted earnings of \(5.15 and \)6.23 per share, respectively. We returned cash to shareholders of \(178 million in dividends and successfully completed a \)1 billion senior notes offering to restructure our debt maturities.

In 2020, we invested over \(300 million into our specialty growth platforms through acquisitions and capital investments to expand organic growth. In addition, our global specialties portfolio grew in each region, with overall specialty sales now representing 32% of Ingredion's total sales, up two points from the prior year. Global net sales decreased 4% for the year or 1% absent foreign exchange impacts. The decrease was driven by sales volume declines primarily in the Americas related to COVID-19 shutdowns in the second and third quarters. Our business gained increasing momentum in the second half of the year, with fourth quarter operating income up year over year in every region.

Operating with an Owner's Mindset, our teams made great progress redesigning and restructuring our organization. We reinvented the way we work, establishing an Office of

## 2020 Quarterly Net Sales
$ in billions

![](images/3_0.jpg)

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## Specialties Strategy

Build on our global innovation strengths aligning with current and future consumer trends and a changing customer landscape

## Cost Smart

Focus and simplify to better anticipate, execute and operate with agility to improve productivity and smartly lower our costs

## Commercial Excellence

Accelerate and deliver value through customer co-creation and differentiated go-to-market capabilities

## Purpose/Culture/Values/Talent

Unleash the potential of our people by embracing an inclusive culture supported by contemporary values and an inspiring core purpose

Transformation, further globalizing shared services and leveraging new digital tools to drive simplification in our business. We reimagined the way we connect with customers by conducting over 1,300 virtual customer engagements. We also achieved $103 million in cumulative run-rate savings under our Cost Smart program, completing more than 90 Cost Smart-related projects. We remain on track to meet our three-year savings target of $170 million by the end of 2021.

## Executing Strategic Priorities to Forge Growth

We made excellent progress against each of our strategic pillars in 2020. We delivered Commercial Excellence by turning our culinary kitchens into digital studios to livestream product formulation and taste testing sessions with our customers. We deployed new forms of digital collaboration to connect, innovate and co-create with customers as we shared real-time ideas and solutions from our 32 Ingredion Idea Labs \( ^{®} \)  innovation centers around the world.

We diversified our specialties portfolio beyond corn by expanding our capacity and capabilities in tapioca, rice and potato-based specialty starches, stevia, and pulse-based and quinoa proteins. We also continued to drive specialties growth by strengthening our market position through acquisitions and investments.
OUR STRATEGIC PILLARS TO FORGE GROWTH CONTINUE TO GUIDE OUR ACTIONS

• We became the first and only ingredient supplier in North America to offer a complete range of 100% sustainable plant-protein isolates, concentrates and flours. Our South Sioux City, Nebraska, manufacturing facility has been officially recommended for FSSC 22000 food-grade certification, and we have a strong and growing pipeline of customer projects as we enter 2021.

• We acquired 100% ownership of Verdient to expand our capabilities and manufacturing capacity for on-trend, sustainable pulse-based flours and protein concentrates. The Verdient acquisition brought our cumulative investment over the last three years in plant-based proteins to more than $200 million.

• We acquired 75% of PureCircle, the world's leading producer and innovator of stevia sweeteners, significantly expanding our capabilities in sugar reduction. Ingredion provides PureCircle with an exciting opportunity to leverage our go-to-market model, our formulation expertise, and broad ingredient portfolio to drive stevia and sugar reduction system sales globally.

• We entered into an agreement with NorQuin expanding our specialties portfolio with quinoa-based ingredients.

## Our Values,
Our Bedrock

![](images/4_0.jpg)

Care First

![](images/4_1.jpg)

![](images/4_2.jpg)

Innovate Boldly

![](images/4_3.jpg)

Everyone Belongs

![](images/4_4.jpg)

Be Preferred

Owner's Mindset

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# Customer and Investor Value Creation
through ingredient solutions
that make life better

Customer co-creation and consumer-preferred innovation

## INVEST IN OUR SPECIALTY GROWTH PLATFORMS

![](images/5_0.jpg)

Starch-Based Texturizers

![](images/5_1.jpg)

Clean and Simple Ingredients

![](images/5_2.jpg)

Plant-Based Proteins

![](images/5_3.jpg)

Sugar Reduction and Specialty Sweeteners

![](images/5_4.jpg)

Food Systems

## LEVERAGE AND ENHANCE OUR STRENGTHS

Core Food and Industrial Ingredients

Supply Chain and Operational Excellence

Sustainable and Trusted Sourcing

Purpose and Performance-Driven Culture

## CONTINUING TO BUILD
OUR SPECIALTY BUSINESS

>32%

of Total Net Sales,
2020

## A Purpose-Driven and Sustainable Future

Ingredion is proud to support the communities where we operate, live and work. Last year, through our work with the Global FoodBanking Network, we provided more than 1.2 million meals to families in need. As communities around the world recover from the devastating impact of the pandemic, we intend to build on our community work with a focus on addressing food insecurity, extreme poverty and assistance for local health care.

We believe that operating sustainably is a shared responsibility that provides an opportunity to collaborate with our customers and other stakeholders and contribute to a more sustainable future. As we executed our strategy in 2020, we remained sharply focused on environmental, social and governance (ESG) principles captured in our "All Life" Sustainability Plan and by the 2030 sustainable development goals we established and launched on Earth Day 2020. We have ambitious targets for plastic neutrality, reducing greenhouse gas emissions, water conservation and sustainable agriculture. We are collaborating with customers, suppliers, NGOs and industry experts to further align our efforts with the United Nations Sustainable Development Goals.

In support of the cause for social justice and a more equitable society, we are leaning on our value of Everyone Belongs, and increasing our efforts to create a more diverse workforce and inclusive workplace. We deeply believe that diversity, equity and inclusion are foundational to our performance and purpose-driven

## MOVING FORWARD WITH FOCUS

OUR STRATEGY HAS REMAINED CONSTANT
THROUGHOUT: WE CONTINUE TO ACTIVELY INVEST
IN SPECIALTIES GROWTH—OUR FOCUS AREAS ARE
ALIGNED WITH LONG-TERM CONSUMER TRENDS.

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## All Life: Sustainability Focus

## PLANET LIFE

Committed to
protecting the
planet's resources

## EVERYDAY LIFE

Prioritize the
well-being of our
employees, customers
and suppliers

## CONNECTED LIFE

Strive to improve
lives of growers and
communities

culture, enabling us to attract and retain top talent and providing a competitive advantage. We are actively listening to our employees through regular pulse surveys and we are responding to create a welcoming environment where everyone feels and is valued. As a member of the Paradigm for Parity \( ^{®} \)  coalition, we pledged to achieve gender parity in corporate leadership roles by 2030 with a near-term goal of at least 30% representation in all leadership groups. We are proud to share that our employee engagement scores reached their highest levels ever last year.

We take pride in continuing to be recognized by reputable third parties as an employer of choice, leading and operating with a purpose, making values-based decisions and creating positive change in global communities. In 2020, Ingredion was recognized by Fortune magazine for the 12 \( ^{th} \)  consecutive year as one of the World's Most Admired Companies. We are proud to also be recognized as one of the World's Most Ethical Companies by Ethisphere for the eighth consecutive year and be included on the Bloomberg Gender-Equality Index for the fourth consecutive year. For the first time, we earned a near-perfect score on the Human Rights Campaign Corporate Equality Index. These distinguished awards and rankings are recognition and validation for Ingredion's ongoing efforts to live its purpose and values.

Cost Smart
Momentum

$103M

cumulative run-rate savings in 2020

## Looking Ahead with Optimism and Confidence

As we enter 2021 with our strategy tested and validated, our portfolio strengthened and with positive business momentum, we are confident in our ability to address the likely continued challenges and uncertainties presented by the pandemic. We are well positioned to benefit from the likely global economic recovery as vaccines becomes more widely available and administered around the world. We will continue to strengthen the value propositions of our growth platforms, co-create with customers and continuously reinvent the way we work to create long-term shareholder value.

I want to express my sincere appreciation to our employees for their commitment and relentless focus as we met the challenges of 2020. I also would like to express my gratitude to our board of directors for their continued guidance and support, and my thanks to our shareholders for your belief in Ingredion.

Sincerely,

![](images/6_0.jpg)

James P. Zallie
President and CEO
April 7, 2021

* Adjusted operating income and adjusted earnings per share are not financial measures calculated in accordance with generally accepted accounting principles (GAAP). See page 76 of the Form 10-K forming part of this annual report to shareholders for a reconciliation of adjusted operating income to the most comparable GAAP financial measure and page 75 of this annual report to shareholders for a reconciliation of adjusted earnings per share to the most comparable GAAP financial measure.