Lassonde Industries, Inc. Class A · TSX:LAS.A
Lassonde Industries, Inc. Class A — Q1 2015 Earnings Presentation
37 slides from Lassonde Industries, Inc. Class A's earnings presentation, May 12, 2015
Slide 1: Financial Results for Fiscal 2014 and First Quarter 2015
Financial Results for Fiscal 2014 and First Quarter 2015 MAY 12, 2015
Slide 2: Forward-Looking Statements
FORWARD-LOOKING STATEMENTS Certain statements made in this presentation, including, but not limited to, statements regarding the prospects of the industry, plans, financial position, and business strategy of the Company may constitute forward-looking statements within the meaning of Canadian securit
Slide 3: Highlights–Fiscal 2014: Earnings
HIGHLIGHTS–FISCAL 2014 Earnings In millions of $ Years ended (except EPS) December 31 %Δ %Δ 2014 2013 2012* 14 vs 13 13 vs 12 Sales 1,181.0 1,040.2 1,022.2 13.5% 1.8% Operating profit 88.4 83.1 85.9 6.3% -3.2% Operating profit/Sales 7.5% 8.0% 8.4% Profit 47.4 46.3 45.3 2.3% 2.3% Profit attributable
Slide 4: Highlights–Fiscal 2014: Earnings (cont'd)
HIGHLIGHTS–FISCAL 2014 Earnings (cont'd) ● Sales of $1,181.0M, $140.8M from $1,040.2M in 2013; ● Apple & Eve (A&E) 5-month sales of $98.2M; ● Favourable foreign exchange impact of $34.9M; ● $34.0M increase in sales of private label products; ● $15.9M decrease in the Company’s national brand sales
Slide 5: Highlights–Fiscal 2014: Earnings (cont'd)
HIGHLIGHTS–FISCAL 2014 Earnings (cont'd) ● “Other (gains) losses” $1.8M gain in 2014 vs a $1.3M gain in 2013: ● Substantially all of the gains came from foreign exchange gains; ● The increase is mainly attributable to the increase in value of the U.S. dollar and its impact on certain assets denomina
Slide 6: Highlights–Fiscal 2014: Consolidated Statements of Financial Position
HIGHLIGHTS–FISCAL 2014 Consolidated Statements of Financial Position In millions of $ As at December 31 %Δ %Δ 2014 2013 2012 14 vs 13 13 vs 12 Non-cash working capital 167.2 120.8 127.1 38.4% -5.0% Property, plant and equipment 251.8 248.4 238.9 1.4% 4.0% Total assets 1,016.7 796.8 800.0 27.6% -0.4%
Slide 7: Highlights–Fiscal 2014: Free Cash Flow Analysis
HIGHLIGHTS–FISCAL 2014 Free Cash Flow Analysis In m illions of $ Years ended December 31 Variance 2014 2013 2014-2013 Free cash flows Profit 47.4 46.3 1.1 Adjustments Amortization and Depreciation 34.7 32.4 2.3 Pension plans, income tax and other 11.5 14.0 (2.5) Change in non-cash working capital (1
Slide 8: Highlights–First Quarter 2015: Earnings
HIGHLIGHTS–FIRST QUARTER 2015 Earnings In millions of $ (except EPS) First Quarters ended March 28 March 29 %Δ $Δ 2015 2014 15 vs 14 15 vs 14 Sales 327.7 244.2 34.2% 83.5 Operating profit 17.0 14.3 18.6% 2.7 Operating profit/Sales 5.2% 5.9% Profit attributable to shareholders 7.8 7.1 9.5% 0.7 EBITDA
Slide 9: Highlights–First Quarter 2015: Earnings (cont'd)
HIGHLIGHTS–FIRST QUARTER 2015 Earnings (cont'd) ● Sales of $327.7M, $83.5M from $244.2M in 2014; ● 34.2% increase attributable to: – Apple & Eve (A&E) sales of $62.5M; – Favourable foreign exchange impact of $15.1M; – $10.7M increase in sales of private label products partly offset by – lower sale
Slide 10: Highlights–First Quarter 2015: Earnings (cont'd)
HIGHLIGHTS–FIRST QUARTER 2015 Earnings (cont'd) ● “Other (gains) losses” went from a $1.2M gain in 2014 to a $1.3M gain in 2015, $0.1M ● The 2015 gain due to $2.1 million in foreign exchange gains partly offset by a $0.8 million loss in the fair value of interest rate swaps. ● Effective tax rate o
Slide 11: Dividends and Outlook–Fiscal 2015
DIVIDENDS AND OUTLOOK–FISCAL 2015 ● Dividends: ● Quarterly dividend of $0.41 per share (payable on June 15 for Q1); ● 2.5% increase over 2014; ● On an annualized basis, represents approximately 25% of 2014 profit attributable to shareholders. ● Outlook: ● Fiscal 2015 will include an entire year of A
Slide 12: Lassonde Industries Inc. Healthy, Strong, and Innovative
LASSONDE INDUSTRIES INC. Healthy, Strong, and Innovative 12
Slide 13: Lassonde Industries Inc. 2014 Sales and Business Units
LASSONDE INDUSTRIES INC. 2014 Sales: $1,181.0 million Cash flows from operating activities: $79.1 million Lassonde Industries Inc. develops, manufactures, and markets distinctive food products. A. Lassonde Inc. Lassonde Clement Pappas Arista Wines Apple & Eve Specialties Inc. and Company, Inc. (acqu
Slide 14: Changes in Geographic Sales Distribution
LASSONDE INDUSTRIES INC. Changes in geographic sales distribution In CA$M $1,400 $1,200 $1,000 52% $800 $600 6% $400 92% 48% $200 $0 2010 2011 2012 2013 2014 Canada United States Other N.B.: The year 2014 includes 5 months of operations for Apple & Eve. 14
Slide 15: Corporate Strategy: Right Product, Right Size, Right Price
CORPORATE STRATEGY To offer the right product in the right size at the right price To focus on To healthy products consolidate To promote To innovate sustainable development 15
Slide 16: To Consolidate: Apple & Eve
CORPORATE STRATEGY To consolidate: Apple & Eve ● The acquisition of Apple & Eve enabled the Company to enter the branded juice business in the United States; ● Apple & Eve is a leader in the category of shelf-stable, ready-to- drink juice in the U.S.; ● Apple & Eve markets its juices in plastic bott
Slide 17: To Consolidate: Apple & Eve Video
CORPORATE STRATEGY To consolidate: Apple & Eve Video 17
Slide 18: A&E: Product and Package Types
CORPORATE STRATEGY To consolidate: Apple & Eve A&E: Product and Package Types Gross sales by product – LTM Gross sales by package type Other Other 4% Single-serve 5% 4% bottles 5% 5% 16% Multi-serve 51% bottles 38% Aseptic 53% 19% 18
Slide 19: To Consolidate: The Next Steps
CORPORATE STRATEGY To consolidate: The next steps ● First, focus on taking advantage of economies of scale resulting from the acquisition of A&E; ● Maintain a fast pace of debt repayment to reduce the Company’s leverage and to better position Lassonde to seize future business opportunities; ● Stay o
Slide 20: Offer the Right Product in the Right Size at the Right Price
CORPORATE STRATEGY Offer the right product in the right size at the right price ● More than ever: ● The life cycle of products has shortened; ● Maintain a competitive advantage; ● We must develop multiple focuses; ● Consumption patterns change; ● Decode trends; ● We must create value through innovat
Slide 21: Complexification of the Beverage Industry with Hyper-Segmentation
CORPORATE STRATEGY Offer the right product in the right size at the right price ● Complexification of the beverage industry with hyper-segmentation 1970–1979 1980–1989 1990–1999 2000–2010 Today CSDs CSDs CSDs CSDs CSDs Juice Juice Juice Juice Juice Milk Milk Milk Milk Milk Bottled water Bottled wate
Slide 22: Beverage Market Size and Diversification
CORPORATE STRATEGY Offer the right product in the right size at the right price ● One person drinks approximately 756 litres of fluids a year; ● The beverage market has literally exploded in terms of diversification over the past 15 years; ● In the U.S., beverages are an $81.4 billion industry with
Slide 23: To Innovate
CORPORATE STRATEGY To innovate ● In the U.S., new products in the shelf-stable juice category represent over $250 million a year, approximately 3%; ● In Canada, new products in the shelf-stable juice category represent some $60 million a year, approximately 3%; ● Lassonde is the leader in innovation
Slide 24: To Focus on Healthy Products
CORPORATE STRATEGY To focus on healthy products Consumers are on a quest for Health and Wellness SOURCE: Lassonde 24
Slide 25: More Desirable Ingredients
CORPORATE STRATEGY To focus on healthy products MORE desirable ingredients: 25
Slide 26: More Desirable Ingredients: Organic
CORPORATE STRATEGY To focus on healthy products MORE desirable ingredients: Organic 26
Slide 27: Clement Pappas
CORPORATE STRATEGY To focus on healthy products Clement Pappas 27
Slide 28: Fewer Calories
CORPORATE STRATEGY To focus on healthy products FEWER calories 28
Slide 29: Sustainable Development
CORPORATE STRATEGY Sustainable development ● Demonstrate our leadership in the environmental performance of our operations and communicate our accomplishments with regard to our three priorities: water, packaging, and health; ● Continue our efforts in optimizing water use, in responsible procurement
Slide 30: Follow-up on 2014 Priorities
FOLLOW-UP ON 2014 PRIORITIES Acquisition enabling accelerated entry of national Apple & Eve brand products into the U.S. market Oasis Organic, Launch of new products Oasis NutriSolution, Del Monte Gold, etc. Long-term agreements Long-term private-label agreements concluded with two major clients Con
Slide 31: 2015 Priorities
2015 PRIORITIES ● Leverage synergies from the acquisition of Apple & Eve; ● Large-scale deployment of the range of healthy products in Canada; ● Expansion of the range of A&E products with emphasis on launching both private-brand and national-brand organic products in the United States; ● Implementa
Slide 32: Lassonde Industries Inc. Financial Performance
LASSONDE INDUSTRIES INC. Financial Performance 32
Slide 33: Selected Financial Information: Sales and EBITDA
SELECTED FINANCIAL INFORMATION 5 YEARS Sales (in millions of $) EBITDA (in millions of $) *CAGR 5 years: 17.6% *CAGR 5 years: 13.9% 1,300.0 140.0 1,181.0 123.2 120.0 116.2 115.7 1,100.0 1,022.2 1,040.2 900.0 100.0 760.3 83.7 80.0 700.0 66.7 536.2 60.0 500.0 40.0 300.0 20.0 100.0 0.0 -100.0 2010 2011
Slide 34: Selected Financial Information: EBIT and EPS
SELECTED FINANCIAL INFORMATION 5 YEARS (cont'd) EBIT (in millions of $) EPS (in $) *CAGR 5 years: 13.3% *CAGR 5 years: 7.0% 100.0 8.00 85.9 88.4 83.1 7.00 6.47 6.32 6.43 80.0 6.00 5.16 60.7 4.86 5.00 60.0 50.2 4.00 40.0 3.00 2.00 20.0 1.00 0.0 0.00 2010 2011 2012 2013 2014 2010 2011 2012 2013 2014 F
Slide 35: Stock Price
STOCK PRICE ● The stock price increased from $56.50 as at May 7, 2010 to $137.19 as at May 7, 2015 for a total return of 143% (CAGR – 5 years: 19.4%). Dividends per share - 5 years 2010 2011 2012 2013 2014 1.14 1.19 1.23 1.48 1.59 35
Slide 36: Questions
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Slide 37: Financial Results for Fiscal 2014 and First Quarter 2015
Financial Results for Fiscal 2014 and First Quarter 2015 MAY 12, 2015