The J.m. Smucker Company · NYSE:SJM
The J.m. Smucker — Consumer Analyst Group of New York Conference 2011
107 slides from The J.m. Smucker's conference presentation, Feb 22, 2011
Slide 1: Consumer Analyst Group of New York Conference Presentation
Consumer Analyst Group of New York Conference Presentation February 22, 2011 r CREATING MEMORABLE MEALS & MOMENTS
Slide 2: Richard Smucker
Richard Smucker Executive Chairman & Co-CEO CREATING MEMORABLE MEALS & MOMENTS
Slide 3: Smucker Family of Brands
Slide 4: Vince Byrd and Mark Belgya
Vince Byrd President, U.S. Retail Coffee Mark Belgya Senior Vice President & CFO CREATING MEMORABLE MEALS & MOMENTS
Slide 5: Steve Oakland and other presenters
Steve Oakland President, U.S. Retail-Smucker's, Jifand Hungry Jack Mark Smucker President, Special Markets Paul Smucker Wagstaff President, U.S. Retail Oils and Baking Sonal Robinson Vice President, Investor Relations CREATING MEMORABLE MEALS & MOMENTS
Slide 6: Forward Looking Statement
Forward Looking Statement This presentation contains forward-looking statements, such as projected operating results, eamings and cash flows, that are subject to known and unknown risks and uncertainties that could cause actual results to differ materially from any future results, performance, or ac
Slide 7: Coffee Business
Coffee Business = Polgers} JOURMET jor ORIGINAL BLEND = Ss FS | MILISTONESS ~
Slide 8: The J. M. Smucker Company
The J. M. Smucker Company 5 S a
Slide 9: Key Priorities
Key Priorities \ ; Launching new products Investing in our brands Improving supply chain Delivering shareholder returns { CREATING MEMORABLE MEALS & MOMENTS
Slide 10: Shareholder Value
Shareholder Value | SSE, Record sales and earnings in fiscal 2010 Fiscal 2011 tracking to exceed 2010 Strong free cash flow Consistently increased dividend Committed to share repurchase program CREATING MEMORABLE } MEALS & MOMENTS
Slide 11: Agenda
Agenda Company strategy Current environment Business segment activities Financial update { CREATING MEMORABLE MEALS & MOMENTS
Slide 12: Bringing Families Together
Bringing Families Together to Share Memorable Meals and Moments
Slide 13: Our Foundation
Our Foundation Our e Own and market #1 food brands Vision e Emphasis on North America e Maintain a global perspective e Building emotional bonds e Developing strong relationships e Ability to implement Core Competencies Basic Beliefs + Quality * People «Ethics * Growth « Independence a aaa — — S (CR
Slide 14: Long-Term Growth Objectives
Long-Term Growth Objectives | ee — s g L 7 Net Sales 6% | New Products, Market Share, Category Growth Organic Growth Acquisitions Enabling, Bolt-On, Transformational 3-4% 2-3% Se > EPS +8% Shareholder Return ~11% { CREATING MEMORABLE j MEALS & MOMENTS
Slide 15: Consumers Looking for Value
Consumers Looking for Value Trust Consistency Variety | Consumer h CREATING MEMORABLE ; MEALS & MOMENTS
Slide 16: New Products
| New Products oer ’ d < . wi “ 2 : ae Rs ray . ns he . ‘ oie > | ae | Ass | | Dy STRAWBERRY. are? y SHORTCAKE aoe Tl) — > 3 co CREATING MEMORABLE j MEALS & MOMENTS
Slide 17: New Products
Makes "You" Smile New Products Good & Good For "You" Easy For "You" 17
Slide 18: New Products
New Products M my ee ae i Apu: = Sate a Over 3% of FY11 Net Sales | MEALS & MOMENTS if CREATING MEMORABLE }
Slide 19: Marketing Investments
Marketing Investments | EES =a) r Record level of marketing spend in 2010 New TV commercials: 30 in FY10 20 in FY11 Leading share of voice in key categories CREATING MEMORABLE j MEALS & MOMENTS “19
Slide 20: Advertising
Advertising CREATING MEMORABLE j MEALS & MOMENTS
Slide 21: Responsible Advertising
Responsible Advertising The J. M. Smucker Company Parent’s Television Council 2010 Award Winner "We applaud companies like Smucker and Coca-Cola for their consistency in sponsoring family-friendly shows." COUNCIL MEALS & MOMENTS CREATING MEMORABLE 21
Slide 22: Digital Media
Digital Media mn) = pis e Hy > 4 f HE \ { > hg Bs) Bacon art Cheese Agpetzer cmp sd bead an eaunabin ~ ao
Slide 23: Power of Family Meals
Power of Family Meals ’ the POW E R of FAMILY MEALS FEATURED ARTICLE FEATURED MEAL Saal “Gating TOGETHER fe & happier”- miriam woinstein Family Favorite Recipe Videos Let us show you how to make our Grilled Gartic Chicken Salad and other recipes your family will love
Slide 24: Our Center-of-Store Strategy
Our Center-of-Store Strategy || eS, | Eggs & Dairy Center of the store Smucker in Top 10 U.S. Branded Dry Grocery Foods Manufacturers Source? IRI'S2 Weeks ending May 2010
Slide 25: Types of Acquisitions
Types of Acquisitions Types Description Example la « Smaller in size Enabling + New capabilities PoMUCKER Se ee ¢ Increase category presence Bolt-On « Leverage existing infrastructure — Cc ¢ Larger in size e Game changing w » New markets and Folgers categories Transformational J MEALS & MOMENTS if C
Slide 26: Commodity Cost Inflation
Commodity Cost Inflation Supply Outlook; Higher Pri ea Exp CREATING MEMORABLE MEALS & MOMENTS
Slide 27: Strong Portfolio of #1 Brands
Strong Portfolio of #1 Brands | ee , Clk: ay { € eye y Sty 7 Jif Folgers ae @ination I CREATING MEMORABLE j MEALS & MOMENTS “o7
Slide 28: Strength of Our Brands
Strength of Our Brands e Ability to price e Consistent approach e Category leadership e Successful history CREATING MEMORABLE MEALS & MOMENTS
Slide 29: Earnings Per Share
Earnings Per Share e Productivity initiatives e Cost reduction efforts e Trade spend efficiency e Improving sales mix e Share repurchases — 4 IF bolgers MEALS & MOMENTS { CREATING MEMORABLE |
Slide 30: Five-Year Financial Growth
($ in millions except per share data) Net Sales 18% CAGR FYO5 FY10 aa Operating Income (°"-6“P) 27% CAGR | $253 FYO5 ) FY10 Earnings Per Share ("°"-6P) Free Cash Flow 11% CAGR 56% CAGR
Slide 31: Trended Performance
Trended Performance Five Year CAGR's Net Sales EPS on FYO3= FY07 FY04 — FY08 27% 15% 16% 8% FYO5.— FYO9 22% 9% FY06 — FY10 Long-Term Growth Target 18% 6% 11% +8% Met or exceeded target
Slide 32: Vince Byrd
Vince Byrd President, U.S. Retail Coffee CREATING MEMORABLE MEALS & MOMENTS
Slide 33: Segment Performance
Segment Performance Net Sales U.S. Retail U.S. Retail Consumer Coffee 23% 39% Total: $4.7 billion Segment Profit U.S. Retail U.S. Retail Consumer Coffee 48% S. Retail '& Baking Special E Markets We 14% Total: $1.1 billion CREATING MEMORABLE Trailing Twelve Months Ended January 31, 2011 \ MEALS & MOM
Slide 34: Coffee Areas of Focus
Coffee Areas of Focus e Investing in the core brands e Launching new products Building category leadership capabilities Improving supply chain Managing through commodity cost environment \ —— { CREATING MEMORABLE ] MEALS & MOMENTS 34
Slide 35: The U.S. At-Home Coffee Category
The U.S. At-Home Coffee Category Mainstream Roast & Ground 47% Premium 31% Total: $6.4 Billion at Retail Source: Smucker Internal All Outlet Share Report 52 Weeks Ended 1/23/11 MEALS & MOMENTS CREATING MEMORABLE
Slide 36: Coffee Segments
Coffee Segments Ww ier DUNKING Gi Roast & Ground Folgers Can SA Brick Pack AG Premium Bag 4 A Bulk Single Serve Instant SA K-Cups Singles 4 Coffee Dollar Share = 35% Source: Smucker Internal All Outlet Share Report 52 Weeks Ended 1/23/11
Slide 37: Net Sales
Net Sales Single Serve 12% 22% Premium Mainstream Roast & Ground 66% Trailing Twelve Months Ended January 31, 2011 { CREATING MEMORABLE } MEALS & MOMENTS
Slide 38: Folgers Roast & Ground
Folgers Roast & Ground e Growing the core red can e Improving sales mix e Investing in the brand e Providing choices 4 | CREATING MEMORABLE j MEALS & MOMENTS
Slide 39: Folgers Growth Opportunities
Folgers Growth Opportunities Increased support of Folgers Black Silk and Special Roast’
Slide 40: Folgers Black Silk
Folgers Black Silk r Wonderfully Bold, Surprisingly Smooth Folgers Bleck SiLE Cottec The Best Part Of Wakin’ Up: 50% volume growth tn FY11
Slide 41: Marketing
Marketing = CREATING MEMORABLE MEALS & MOMENTS A
Slide 42: CREATING ME
CREATING ME Z,-REATING MEMORABLE Pvt! L MEALS & AEALS & MOMENTS
Slide 43: Contest
contest The best part of wakin’ up, Po S 5 ae ra oa tol { CREATING MEMORABLE | MEALS & MOMENTS
Slide 44: Folgers Commercials
Folgers Commercials ww Folgers IINGI C yl NILE contest % CREATING MEMORABLE MEALS & MOMENTS
Slide 45: Dunkin' Donuts
Dunkin’ Donuts e #2 brand in premium coffee segment e Long-term licensing arrangement e Nearly $300 million in annual sales e 18% volume growth over past 12 months ~ ORIGINAL BLEND f % CREATING MEMORABLE MEALS & MOMENTS
Slide 46: Dunkin' Donuts Growth
Dunkin’ Donuts Growth Cinnamon Spice French Vanilla Hazelnut ACV 30% - 65% Original Blend represents #1 SKU in segment CREATING MEMORABLE ; MEALS & MOMENTS
Slide 47: Dunkin' Donuts Seasonal
SS I 4 Dunkin Donuts Seasonal eae | Exceeded expectations Highly incremental to brand sales High velocities during peak holiday periods CREATING MEMORABLE j MEALS & MOMENTS
Slide 48: Dunkin' Donuts Seasonal
Dunkin’ Donuts Seasonal CREATING MEMORABLE is MEALS & MOMENTS
Slide 49: Marketing
Marketing , CREATING MEMORABLE j MEALS & MOMENTS
Slide 50: History of Innovation
History of Innovation Committed to growing the overall category Continued focus on convenience Expanding reach of the brands { CREATING MEMORABLE MEALS & MOMENTS “50
Slide 51: K-Cups
K-Cups e Launched in September 2010 e Fastest growing area in at-home coffee category e Outstanding retailer and consumer acceptance e Contributed 4% to 3' quarter coffee segment sales CREATING MEMORABLE MEALS & MOMENTS 51
Slide 52: K-Cups Growth
. K-Cups Growth r Millstone? ——~ ——<—— Folgers Gourmet Selections® \ 7 - Black Lively ¢,pively == Vanilla Silk Colombian Hecat Biscotti —— | @ Eye 12-week ACV 60% > Breakfast Hazelnut Blend Cream pono m normae 12-week ACV 30% Folgers Gourmet Selections® is #2 brand in K-Cups® for latest 12-week peri
Slide 53: K-Cups Commercial
K-Cups Commercial The best part of wakin’ up. CREATING MEMORABLE j MEALS & MOMENTS
Slide 54: Coffee New Products
Coffee New Products eSERS e Introducing new K-Cup® varieties this summer e Focusing on convenience CREATING MEMORABLE MEALS & MOMENTS
Slide 55: Category Leadership
Category Leadership e Innovation e Participation in all segments e Consumer research e Coffee college CREATING MEMORABLE MEALS & MOMENTS
Slide 56: Restructuring Project - Coffee
Restructuring Project - Coffee _ t ae <-- aoe r Spring 2011 H Summer 2012 B= - a =a F Sherman, TX Kansas City, MO plant closes plant closes CREATING MEMORABLE j MEALS & MOMENTS
Slide 57: Green Coffee Costs
Green Coffee Costs Futures since April 30, 2010 e Arabica +100% e Robusta +70% Three rounds of pricing actions with a combined 23% increase in fiscal 2011 As of February 18, 2011 { CREATING MEMORABLE | MEALS & MOMENTS
Slide 58: Coffee Business
Coffee Business BSR =~ a Folgers CLASSIC ROAS CREATING MEMORABLE MEALS & MOMENTS 58
Slide 59: Segment Performance
Segment Performance Net Sales Segment Profit U.S. Retail Consumer U.S. Retail Consumer U.S. Retail Coffee U.S. Retail 27% Coffee 39% 48% S. Retail '& Baking Special 11% Markets 14% Total: $4.7 billion Total: $1.1 billion CREATING MEMORABLE Trailing Twelve Months Ended January 31, 2011 MEALS & MOMENT
Slide 60: Fruit Spreads
Fruit Spreads Fruit Spreads Dollar Share = 45% Preserves Coker 7 f) s Bu EBERRY fyesoomey Fs°,| ro) eo ALS & MOMENTS
Slide 61: Orchard's Finest
Orchard's Finest A full line of premium fruit preserves brimming with intense fruit taste! Expanded Distribution Nationally CREATING MEMORABLE j MEALS & MOMENTS
Slide 62: Sugar Free
Sugar Free y SUGAR FREE Blueberry Preserves ATING MEMORABLE ALS & MOMENTS
Slide 63: New Products
New Products Launching first sugar free fruit spread item sweetened with 7ruvia™ Developed 3 new products offering blended-fruit flavors Available in fiscal 2012 9 a ¢ % a4 r FS MUCKERG Yaa pyr cMUCKER, an SUGAR FREE : oe — re ovr se tune CREATING MEMORABLE j MEALS & MOMENTS “63
Slide 64: Share of Voice
Share of Voice SERS 95% share of voice in fruit spreads category y Source: Nielsen Ad*Views FY10
Slide 65: Commercials
Commercials tad ful _.—— CREATING MEMORABLE j MEALS & MOMENTS
Slide 66: Restructuring Project - Consumer
Restructuring Project - Consumer Fall 2010 F Summer 2012 H Summer 2013 H Fall 2013 New Orrville plant | New Orrville plant | Orrville production | New Orrville plant construction began |_ initial production phase-in complete | complete start up Memphis, TN plant closes Ste.Marie, Quebec plant closes
Slide 67: Peanut Butter
Peanut Butter Peanut Butter Dollar Share = 45% AMS = NUNATORAL < B 0% NATURA; Lira’ (Ccudder oo NUTTY ££ @ CREATING MEMORABLE j MEALS & MOMENTS
Slide 68: Jif Natural
Jif Natural e Current ACV of 78% e Doubled market share over last 52-week period CREATING MEMORABLE j Source: Smucker Internal All Outlet Share Report 52 Weeks Ended 1/23/11 if MEALS & MOMENTS
Slide 69: e Additional growth
e Additional growth Dlatform FOCUS ON CONvenience Positive consumer response CREATING MEMORABLE j MEALS & MOMENTS
Slide 70: Share of Voice
Share of Voice 97% share of voice in peanut butter category : Chossy Moms Choose Jif if CREATING MEMORABLE } Source: Nielsen Ad*Views FY10 MEALS & MOMENTS
Slide 71: Jif To Go Commercial
Jif To Go Commercial I CREATING MEMORABLE j MEALS & MOMENTS
Slide 72: Smucker's Uncrustables
Smucker’'s Uncrustables Sra OS | aie SANDWICHES © SSeS Sa a ers hoe SANDWICHES MEALS & MOMENTS CREATING MEMORABLE ] :
Slide 73: Hungry Jack
Hungry Jack Divested potato products in March 2010 Focus on pancake mixes and syrups Introducing new items later this year = CREATING MEMORABLE j MEALS & MOMENTS
Slide 74: Segment Performance
Segment Performance Net Sales U.S. Retail Consumer U.S. Retail 23% Coffee 39% ;. Retail Special Markets 19% Total: $4.7 billion Segment Profit U.S. Retail Consumer U.S. Retail Coffee 27% 48% . Retail Special 4 : ifariats & Baking 14% 11% Total: $1.1 billion CREATING MEMORABLE Trailing Twelve Months
Slide 75: Oils Category
Oils Category Leading brand in overall category Narrowed everyday price gap 27% volume growth in the 34 quarter 4% volume growth through first nine months of FY11 f CREATING MEMORABLE MEALS & MOMENTS 75
Slide 76: Baking Category
Baking Category Competitive environment Negative impact on our business Focus on innovation CREATING MEMORABLE MEALS & MOMENTS
Slide 77: Baking New Products
Baking New Products Strong seasonal performance Pillsbury provides the category’s only nationally branded sugar-free offerings Launching new products this summer MEALS & MOMENTS if CREATING MEMORABLE } ‘77
Slide 78: Sales by Channel
Sales by Channel r U.S. Retail Markets FY10 Traditional Non- Traditional Non- Grocery / traditional Grocery | Traditional 56% Channels* 52% Channels* 44% 48% Total: $1.9 billion Total: $3.7 billion CREATING MEMORABLE { * Includes Walmart, Mass Retail, Warehouse Club, Military, Chain Drug, Dollar Sto
Slide 79: Segment Performance
Segment Performance Net Sales U.S. Retail Consumer U.S. Retail 5 Coffee 23% 39% Special Markets 19% Total: $4.7 billion Trailing Twelve Months Ended January 31, 2011 \ Segment Profit U.S. Retail Consumer U.S. Retail Coffee 27% 48% S. Retail & Baking ’ 41% Special « Markets 14% Total: $1.1 billion CR
Slide 80: Special Markets
Special Markets r Sales Growth Canada Foodservice Foodservice Natural Foods 35% International CREATING MEMORABLE ; MEALS & MOMENTS Trailing Twelve Months Ended January 31, 2011 {
Slide 81: China Approach
China Approach | SSERS Consistent with Smucker strategy Allocated resources to review opportunities Considering various means of entry Establish meaningful presence over time CREATING MEMORABLE } MEALS & MOMENTS
Slide 82: Canada
Slide 83: Canada
Slide 84: Foodservice
Slide 85: Natural Foods
Slide 86: Smucker Family of Brands
Slide 87: Mark Belgya
Slide 88: FY 2011 3rd Quarter Income Statement Highlights
Slide 89: Cash Flow
Slide 90: Fiscal Year 2011 Outlook
Slide 91: Liquidity
Slide 92: Allocation of Cash Flow
Slide 93: 93
93
Slide 94: Dividends
Slide 95: Share Repurchase Activity
Slide 96: Dividend and Share Repurchase
Slide 97: 2012 Preview
Slide 98: Recent Price Increases
Slide 99: 2012 Preview
Slide 100: Improved Productivity
Slide 101: Strength of Smucker
Slide 102: Smucker Family of Brands
Slide 103: Consumer Analyst Group of New York Conference Presentation
Slide 104: Additional Information
Slide 105: Regulation G Compliance
Slide 106: Unaudited Non-GAAP Measures
The J. M. Smucker Company Consumer Analyst Group of New York Conference Presentation - February 22, 2011 Unaudited Non-GAAP Measures (Dollars in thousands, except per share data) Year Ended April 30, 2010 2005 Operating income before restructuring and merger and integration costs Reconciliation to o
Slide 107: Unaudited Non-GAAP Measures
The J. M. Smucker Company Consumer Analyst Group of New York Conference Presentation - February 22, 2011 Unaudited Non-GAAP Measures (Dollars in thousands, except per share data) Company Guidance Year Ending April 30, 2011 Low High Income per common share -- assuming dilution $ 4.60 $ 4.65 Weighted
The J. M. Smucker Company — Consumer Analyst Group of New York Conference 2011 on 6ix