Hostess Brands — Q3 2022 Earnings Presentation
21 slides from Hostess Brands's earnings presentation, Nov 2, 2022
Slide 1: Investor Presentation
Investor Presentation NOVEMBER 2, 2022
Slide 2: Disclaimer
Disclaimer 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
Slide 3: Key Takeaways
Key Takeaways Strong topline momentum with 20.2% organic net revenue growth during the quarter reflecting higher price/mix while maintaining volume 17.0% Hostess Brands’ point-of-sale growth in Sweet Baked Goods and 28.8% Voortman® branded growth in Cookies* Executed previously announced prici
Slide 4: Demonstrated Top-tier Net Revenue Growth
Demonstrated Top-tier Net Revenue Growth 11th Straight Quarter of Over 9% Net Revenue Growth Quarterly Adjusted Net Revenue Growth 25.1% 20.2% 18.1% 16.1% 16.8% 14.8% 10.8% 10.4% 9.3% 9.1% 9.0% Q1 '20 Q2 '20 Q3' 20 Q4 '20 Q1 '21 Q2 '21 Q3 '21 Q4 '21 Q1 '22 Q2 '22 Q3 '22 Adjusted Net Revenue is a non
Slide 5: Outstanding Financial Performance
Outstanding Financial Performance Demonstrating Agility in a Challenging Operating Environment Net Adjusted Adjusted Revenue EBITDA EPS (in millions) (in millions) 20.2% 12.2% 9.5% growth growth growth $346.2 $72.7 $0.23 $288.0 $64.8 $0.21 Q3 2021 Q3 2022 Q3 2021 Q3 2022 Q3 2021 Q3 2022 Adjusted EBI
Slide 6: Revenue Growth Driven by Hostess and Voortman
Revenue Growth Driven by Hostess® and Voortman® 18+% Organic Growth Across our Portfolio of Sweet Baked Goods and Cookies Three Months Ended Nine Months Ended September 30, Change September 30, Change ($ in millions) 2022 2021 $ % 2022 2021 $ % Sweet Baked Goods $307.3 $258.8 $48.5 18.7% $907.2 $759
Slide 7: Positive Price/Mix Driving 20% Revenue Growth
Positive Price/Mix Driving 20% Revenue Growth Maintaining Volumes While Implementing Incremental Pricing to Offset Inflation 20.2% Organic Net Revenue Growth $346.2 million 20.1% $288.0 0.1% Growth million Growth Net Net Revenue Revenue 7
Slide 8: Continued POS Dollar Growth Across Portfolio
Continued POS Dollar Growth Across Portfolio Outstanding Execution Drives Point-of-Sale Growth in the Sweet Baked Goods and Cookie Categories Point-of-Sale Growth (in millions) $48 $38 28.8% growth Cookies 19.5% 19.9% Sweet 17.0% $456 growth Baked $390 Goods Q3 2021 Q3 2022 Source: Nielsen, Total Ni
Slide 9: 16+% Single-Serve and Multi-Pack POS Growth in Q3
16+% Single-Serve and Multi-Pack POS Growth in Q3 Uniquely Positioned to Drive Both At-Home and Immediate Consumption Occasions Single-Serve Point-of-Sale Q3 2021 15.6% Single-serve 2 year stacked growth Q3 2022 17.5% 33.1% Multi-Pack Point-of-Sale Q3 2021 12.4% Multi-pack 2 year stacked growth Q3 2
Slide 10: Holding Market Share in Volatile Market Environment
Holding Market Share in Volatile Market Environment Breakfast POS Market Share (SBG) up +20%, (13 weeks) Continuing to Grow Market 21.5% 21.4% Share of SBG Sub-category Market Share (Cookies) (13 weeks) Sugar Free POS 2.2% up 28%, Growing 1.9% Market Share of Cookies Sub- category by +500 bps! Q3 ‘2
Slide 11: Consistent Track Record of Market Share Gains
Consistent Track Record of Market Share Gains Outstanding Execution Drives POS Growth and Expanding Market Share in Sweet Baked Goods Category Point-of-Sale Market Share (52 weeks, in millions) (52 Weeks) $1,768 21.6% 20.8% $1,473 $1,339 19.3% 19.4% $1,250 19.0% $1,184 2018 2019 2020 2021 2022 2018
Slide 12: Consolidated Financial Results
Consolidated Financial Results Delivering Double-digit Net Revenue and Adjusted EBITDA Growth for the Quarter and Year-to-date Three Months Ended Nine Months Ended September 30, Change September 30, Change ($ in millions, except per 2022 2021 $ % 2022 2021 $ % share data) Net Revenue $346.2 $288.0 $
Slide 13: Raising Full-Year 2022 Guidance
Raising Full-Year 2022 Guidance Updated Guidance Previous Guidance ($ in millions, except EPS) Net Revenue Growth 17% - 19% At least 15% Towards the higher end of Adjusted EBITDA $290 – $293 $280 – $290 Adjusted EPS $0.96 - $0.98 $0.93 - $0.98 $125 - $135 $120 - $140 Capital Expenditures (Including
Slide 14: Bouncers Innovation Off to a Great Start
Bouncers™ Innovation Off to a Great Start Consistent Track-record of Category Leading Innovation Bouncers™ are receiving strong retailer support Three-year innovation pipeline Targeted for specific occasions and channels Supported by broad investments in digital media 14
Slide 15: Brand Activation is Fueling Consumer Interest
Brand Activation is Fueling Consumer Interest Increasing Top-of-mind Awareness and Consideration High High Disciplined, impulse High ROI margin test and snacking Advertising branded learn categories Spend business approach 15
Slide 16: Executing on Key Capital Allocation Priorities
Executing on Key Capital Allocation Priorities Flexibility to Invest in Growth and Generate Shareholder Value 1 Support Core Growth Capex of $63.8 million YTD ‘22, including investment in new bakery to support continued growth 2 4.0x** Growth-oriented branded targets, that expand our Targeted M&A 3.
Slide 17: Building a Snacking Powerhouse
Building a Snacking Powerhouse Key Enablers of Our Differentiated Growth Our INNOVATION & MARKETING are Our gaining BUSINESS momentum MODEL is best-in-class Our business sits in GROWING SPACES Learn more about our long-term growth story outlined at our recent Investor Day using this QR Code 17
Slide 18: Attractive Long-Term Growth
Attractive Long-Term Growth Delivering Leading Growth While Maintaining our Industry-leading Margins Long-term Growth Algorithm Mid-Single 5-7% 7-9% Digit Organic EBITDA EPS Revenue Growth Growth Growth Delivering Top-Tier Shareholder Returns See "Forward Looking Statements." EBITDA is a non-GAAP fi
Slide 19: Appendix
Appendix
Slide 20: Non-GAAP Reconciliations
Non-GAAP Reconciliations Three Months Ended September 30, 2022 Three Months Ended September 30, 2021 Gross Gross Operating Net Net Income Diluted Gross Gross Operating Net Net Income Diluted Profit Margin Income Income Margin EPS Profit Margin Income Income Margin EPS GAAP results $ 115.4 33.3% $ 54
Slide 21: Non-GAAP Reconciliations
Non-GAAP Reconciliations Nine Months Ended September 30, 2022 Nine Months Ended September 30, 2021 Gross Gross Operating Net Net Income Diluted Gross Gross Operating Net Net Income Diluted Profit Margin Income Income Margin EPS Profit Margin Income Income Margin EPS GAAP results $ 343.7 33.7% $ 163.