Del Monte Pacific Limited · SGX:D03
Del Monte Pacific — 1Q FY2019 Earnings Presentation
30 slides from Del Monte Pacific's earnings presentation, Sep 12, 2018
Slide 1: Del Monte Pacific 1Q FY2019 Results
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® D E L M O NT E PACIFIC 1 Q F Y 2 01 9 R E S U L T S 12 September 2018 NOURISHING FAMILIES. ENRICHING LIVES. EVERY DAY. ®
Slide 2: Disclaimer
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® DISCLAIMER This presentation may contain statements regarding the business of Del Monte Pacific Limited and its subsidiaries (the “Group”) that are of a forward-looking nature and are therefore based on management’s as
Slide 3: Contents
CONTENTS ▪ Summary ▪ 1Q FY2019 Results ▪ Market Updates ▪ Sustainability ▪ Improved Balance Sheet and Cash Flow ▪ Outlook 3
Slide 4: Notes to the 1Q FY2019 Results
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® NOTES TO THE 1Q FY2019 RESULTS ▪ First quarter is 1 May to 31 July 2018. ▪ DMPL’s effective stake in DMFI is 89.4%, hence the non controlling interest line (NCI) in the P&L. Net income/(loss) is net of NCI. ▪ DMPL Grou
Slide 5: 1Q FY2019 Highlights
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® 1Q FY2019 HIGHLIGHTS ▪ The Group generated 1Q sales of US$437m, 8% lower than prior year quarter mainly due to lower sales in the USA, in line with its US subsidiary (DMFI) strategy to deprioritise non-profitable busin
Slide 6: Outlook
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® OUTLOOK ▪ Barring unforeseen circumstances, the Group is expected to be profitable in FY2019 on a recurring basis ▪ Major emphasis on responding to consumer trends through: ✓ Strengthening the core business and innovat
Slide 7: DMPL 1Q FY2019 Group Results Summary
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® DMPL 1Q FY2019 GROUP RESULTS SUMMARY ▪ Sales of US$437.2m, -7.7% Sales % Change US -8 Philippines -5 (in peso terms flat) S&W -15 FieldFresh India (equity accounted) +11 (in rupee terms +14) All figures below without o
Slide 8: One-off Expense/(Income)
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® ONE-OFF EXPENSE/(INCOME) In US$ m 1Q FY18 1Q FY19 Booked under Closure of Sager Creek Arkansas plant - 7.4 Sales/Operating expense Severance 0.9 1.0 G&A expense Gain due to the purchase of DMFI’s - (15.9) Interest Inco
Slide 9: DMPL 1Q FY2019 Results – As Reported
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® DMPL 1Q FY2019 RESULTS – AS REPORTED 1Q 1Q In US$m Chg (%) Comments FY2018 FY2019 Mainly due to lower sales in the USA and lower exports Turnover 473.8 437.2 -7.7 of processed pineapple products Lower sales, significan
Slide 10: 1Q FY2019 Turnover Analysis
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® 1Q FY2019 TURNOVER ANALYSIS 2% 28% Americas 70% Asia Pacific Europe Americas -8.8% ▪ Lower volume across categories, most significantly branded tomatoes and private label sales as well as unfavourable impact of lower p
Slide 11: Market Updates for 1Q FY2019
11 Market Updates for 1Q FY2019
Slide 12: Del Monte Foods Strategy
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® DEL MONTE FOODS STRATEGY Build Relevance: Continually differentiate our brands and products in order to drive consumer preference ▪ Reinforce our points of difference (Del Monte’s quality, College Inn’s rich flavourful
Slide 13: USA
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® USA Market Share (#1) Market Share (#1) Market Share (#2) Market Share (#2) Canned Vegetable Canned Fruit Fruit Cup Snacks Canned Tomato ▪ Remain a brand leader across core categories ▪ Grew share in 3 out of 4 core ca
Slide 14: Del Monte Foods USA
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® DEL MONTE FOODS USA DMFI’s 1Q sales down 8.4% to US$308.3m ▪ Lower volume across categories most significantly branded tomatoes, private label sales ▪ Lower pricing in foodservice for PJC ▪ The decline in sales was in
Slide 15: Initial Launch Support – Fruit & Oats
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® INITIAL LAUNCH SUPPORT – FRUIT & OATS Online Support Consumer Promotions & In-store Del Monte Website Landing Pages + Coupon Retailer Websites Retailer Coupon Booklet Themed Back to School Programmes at Retailers Ibott
Slide 16: Foodservice Highlights
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® FOODSERVICE HIGHLIGHTS Innovation Foundational Efforts Industry Trade Shows • Introduced Distributor Partnership • Started shipments of new line of Programme – provides funding for Riced Cauliflower and other local pro
Slide 17: Philippines
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® PHILIPPINES Market Share (#1) Market Share (#1) Market Share (#1) Packaged Pineapple Canned Mixed Fruit Canned and Carton Juices Market Share (#1) Market Share (#1) Tomato Sauce Spaghetti Sauce ▪ Del Monte is the marke
Slide 18: Philippines
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® PHILIPPINES ▪ 1Q sales were flat in peso terms but down 5% in US dollar terms due to peso depreciation ▪ Key accounts in foodservice and retail beverage and culinary continued to grow ▪ Offset by lower sales of package
Slide 19: Philippine Market - Culinary
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® PHILIPPINE MARKET - CULINARY T T ✓ Roll-out of upgraded pack design ✓ Sustained A&P support & consumption- build through recipe education ✓ Supported value proposition of growing systems-use bundles 19
Slide 20: Philippine Market – Beverage
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® PHILIPPINE MARKET – BEVERAGE ✓ TV ad Airing for Core Brands for broad T based awareness and consumption building – Pineapple Juice, Fit ‘n Right Tand Juice Drinks ✓ Aggressive Digital Campaigns to target core users ✓ I
Slide 21: Philippine Market – New Products
22 N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® PHILIPPINE MARKET – NEW PRODUCTS ✓ Launch of Juice & Chews Digital Campaign and YouTube Fan Fest Partnership! 2.69M Juice & Chews Creator & Youtube Content Views ✓ New claim for Fit ‘n Right Active – “Reduce 2x more
Slide 22: S&W Asia and the Middle East
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® S&W ASIA AND THE MIDDLE EAST ▪ Consumers moving towards less processed and more natural food: S&W expanding sales of S&W Sweet 16 fresh pineapple ▪ E-commerce and digital are growing with North Asia having the largest
Slide 23: S&W Asia and the Middle East
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® S&W ASIA AND THE MIDDLE EAST ▪ Sales of the S&W business were down 15% due to lower sales in North Asia and Turkey ▪ Increased competition from cheaper canned pineapple products from Thailand and Indonesia continued to
Slide 24: S&W Singapore
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® S&W SINGAPORE Singapore– a series of tactical sampling promotions to drive sampling and sales S&W Prune Juice and Pineapple Juice sampling in support of Organic Fair that is organised by select Finest stores of NTUC Fa
Slide 25: FieldFresh India
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® FIELDFRESH INDIA ▪ FieldFresh broke even in 1Q on higher Del Monte product sales and better margins ▪ DMPL’s share of profit in 1Q was US$0.1 million, a turnaround from the share of loss of US$0.5 million in the prior
Slide 26: India – Endless Pastabilities Digital Campaign
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® INDIA – ENDLESS PASTABILITIES DIGITAL CAMPAIGN Creating awareness and affinity for Del Monte range of pasta by leveraging the sheer versatility and therefore the ‘endless pastabilities’ it offers Reach consumers via –
Slide 27: India – Summer Escapades Digital Campaign
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® INDIA – SUMMER ESCAPADES DIGITAL CAMPAIGN Drive Awareness and Recipe carousels consideration of Del Monte Packaged and Dried fruit as delicious, dessert ingredients in summers Reach consumers via – Recipe & sourcing 3
Slide 28: Sustainability
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® SUSTAINABILITY ▪ Del Monte Pacific further improved its ranking to #13 in the 2018 Singapore Governance and Transparency Index from #16 last year, out of 606 SGX-listed companies evaluated ▪ The Group is finalising its
Slide 29: Improved Balance Sheet and Cash Flow
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® IMPROVED BALANCE SHEET AND CASH FLOW ▪ Committed to improve cash flow, reduce debt and interest expense ▪ Raised US$300m from two Preference Share tranches in April and December 2017 to repay loans ▪ DMPL purchased US$
Slide 30: Outlook
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® OUTLOOK ▪ Barring unforeseen circumstances, the Group is expected to be profitable in FY2019 on a recurring basis ▪ Major emphasis on responding to consumer trends through: ✓ Strengthening the core business and innovat