Hostess Brands — FY2022 Earnings Presentation
20 slides from Hostess Brands's earnings presentation, Feb 21, 2023
Slide 1: Investor Presentation February 21, 2023
Investor Presentation FEBRUARY 21, 2023
Slide 2: Forward Looking Statements
Forward Looking Statements This investor presentation contains statements reflecting our views about the future performance of Hostess Brands, Inc. and its subsidiaries (referred to as “Hostess Brands” or the “Company”) that constitute “forward-looking statements” that involve substantial risks and
Slide 3: Key Takeaways
Key Takeaways 3 Third straight year of double-digit growth with net revenue growth of 18.9% in 2022 9.2% Hostess Brands’ point-of-sale growth in Sweet Baked Goods and 28.2% Voortman® branded growth in Cookies during the fourth quarter* Ranked #1 in sweet baked category innovation retail sales
Slide 4: Top-tier Net Revenue Growth
Top-tier Net Revenue Growth 12th Straight Quarter of 9%+ Net Revenue Growth Adjusted Net Revenue is a non-GAAP financial measures. See “Use of Non-GAAP Financial Measures” and the Appendix for an explanation of all non-GAAP financial measures and reconciliations to the comparable GAAP measures. Net
Slide 5: Outstanding Full Year Financial Performance
5 Adjusted EBITDA and Adjusted EPS are non-GAAP financial measures. See “Use of Non-GAAP Financial Measures” and the Appendix for an explanation of all non-GAAP financial measures and reconciliations to the comparable GAAP measures. Outstanding Full Year Financial Performance Strong Execution in a D
Slide 6: Revenue Growth Driven by Hostess and Voortman
Three Months Ended Twelve Months Ended December 31, Change December 31, Change ($ in millions) 2022 2021 $ % 2022 2021 $ % Sweet Baked Goods $303.4 $266.6 $36.8 13.8% $1,210.5 $1,025.5 $185.0 18.0% Cookies 36.1 30.6 5.5 18.0% 147.7 116.5 31.2 26.8% Total Net Revenue $339.5 $297.2 $58.2 14.2% $1,358.
Slide 7: Positive Price/Mix Driving Revenue Growth
Positive Price/Mix Driving Revenue Growth 7 Maintaining Volume While Implementing Incremental Pricing to Offset Inflation in 2022 14.2% Organic Net Revenue Growth 18.9% Organic Net Revenue Growth 20.5% 2.6% 16.3% (6.3)% 4th Quarter Full Year
Slide 8: Continued POS Dollar Growth Across Portfolio
$402 $439 $36 $46 Q4 2021 Q4 2022 Continued POS Dollar Growth Across Portfolio 8 Outstanding Execution Drives Point-of-Sale Growth in the Sweet Baked Goods and Cookie Categories 19.5% 19.9% Source: Nielsen, Total Nielsen Universe for the Company within the SBG Category and Cookie Category. Point of
Slide 9: Single-Serve and Multi-Pack Point-of-Sale Growth in Q4
10.6% 22.2% 7.7% 26.1% 9 Single-Serve and Multi-Pack Point-of-Sale Growth in Q4 Multi-Pack Point-of-Sale Single-Serve Point-of-Sale Source: Nielsen, Total Nielsen Universe for the Company within the SBG Category. Point of Sale, 13 weeks ending 1/1/22 and 12/31/22. Q4 2021 Q4 2022 Single-serve 2 year
Slide 10: Holding Market Share in Volatile Environment
10 Holding Market Share in Volatile Environment Market Share (SBG) (52 weeks) Source: Nielsen, Total Nielsen Universe for the Company within the SBG Category. Point of sale and share changes for the 52 weeks ending 1/1/22 and 12/31/22. Sugar Free POS up 29%, Growing Market Share of Cookies Sub- cate
Slide 11: Consistent Track Record of Point-of-Sale Growth
Consistent Track Record of Point-of-Sale Growth 11 Outstanding Execution Drives Growth in Sweet Baked Goods Category Market Share (52 weeks) 18.0% 19.6% 19.5% 21.3% 21.2% 2018 2019 2020 Point-of-Sale (52 weeks, in millions) $1,143 $1,276 $1,355 $1,551 $1,805 2018 2019 2020 20212021 Source: Nielsen,
Slide 12: Ranked #1 in SBG Category Innovation Retail Sales
12 Ranked #1 in SBG Category Innovation Retail Sales Leading Innovation Sales in All Channels Source: Nielsen, Total Nielsen Universe for the Company within the SBG Category. Point of Sale and Market Share, 52 weeks ending 12/24/22. Highest share of innovation in category at 44% Innovation sales con
Slide 13: Brand Activation is Fueling Consumer Interest
Brand Activation is Fueling Consumer Interest 13 High impulse snacking categories High margin branded business Disciplined, test and learn approach High ROI Advertising Spend Increasing Top-of-Mind Awareness and Consideration Supported Strong Bouncers Innovation Launch in Q4
Slide 14: Executing on Key Capital Allocation Priorities
Executing on Key Capital Allocation Priorities 14 Flexibility to Invest in Growth and Generate Shareholder Value 4.0x** 3.3x Support Core Growth Targeted M&A Return Capital to Shareholders Manage Net Leverage $130.5 million capital expenditures in 2022, including investment in new bakery to support
Slide 15: Consolidated Financial Results
Consolidated Financial Results 15 Delivering Double-Digit Net Revenue Growth for the Quarter and Full Year Adjusted Gross Profit, Adjusted Gross Margin, Adjusted Operating Income, Adjusted EBITDA, Adjusted EBITDA Margin and Adjusted EPS are non-GAAP financial measures. See “Use of Non-GAAP Financial
Slide 16: Introducing 2023 Guidance
Introducing 2023 Guidance ($ in millions, except EPS) 2023 Guidance Net Revenue Growth 4% - 6% Adjusted EBITDA $315 – $325 million (7% - 10% growth) Adjusted EPS $1.08 - $1.13 (10% - 15% growth) Capital Expenditures $150 - $170 million (Including Capacity Expansion) Income Tax Rate ~27% Weighted Ave
Slide 17: Attractive Long-Term Growth
Attractive Long-Term Growth Delivering Top-Tier Shareholder Returns Delivering Strong Growth While Maintaining our Industry-Leading Margins Mid-Single Digit 5-7% EPS Growth See "Forward Looking Statements." EBITDA is a non-GAAP financial measure defined as earnings before interest, taxes, depreciati
Slide 18: Appendix
Appendix 18
Slide 19: Non-GAAP Reconciliations
Non-GAAP Reconciliations 19 1. Project consulting costs are included in general and administrative on the condensed consolidated statement of operations. 2. In 2022, costs related to certain corporate initiatives, of which $0.1 million is included in general and administrative expenses and $0.2 mill
Slide 20: Non-GAAP Reconciliations
Non-GAAP Reconciliations 1. Project consulting costs are included in general and administrative on the condensed consolidated statement of operations. 2. Gain from receipt of insurance proceeds under the representation and warranty insurance policy purchased in connection with the Voortman acquisiti