Turning Point Brands, Inc. · NYSE:TPB
Turning Point Brands — Q3 2024 Earnings Presentation
20 slides from Turning Point Brands's earnings presentation, Nov 7, 2024
Slide 1: Investor Presentation Q3 2024
Turning Point Brands (NYSE: TPB) Investor Presentation Q3 2024 1 | 5 2 0 1 I N T E R C H A N G E W A Y , L O U I S V I L L E K Y | T U R N I N G P O I N T B R A N D S . C O M |
Slide 2: Disclaimer: Forward Looking Statements
DISCLAIMER FORWARD LOOKING STATEMENTS This presentation contains forward-looking statements within the meaning of the federal securities laws. Forward-looking statements may generally be identified by the use of words such as "anticipate," "believe," "expect," "intend," "plan" and "will" or, in each
Slide 3: Company Overview
Turning Point Brands (NYSE: TPB) COMPANY OVERVIEW 3 | 5 2 0 1 I N T E R C H A N G E W A Y , L O U I S V I L L E K Y | T U R N I N G P O I N T B R A N D S . C O M |
Slide 4: TPB: A Unique Consumer Products Growth Company
TPB: A Unique Consumer Products Growth Company Segment Comprises Majority of Profit Pool and Benefits from #1 Premium and Overall Secular Growth Trends in #1 Loose Leaf Chew and Rolling Paper Brand in the U.S. Turning Point Brands (NYSE: TPB) and Canada and #1 in MYO Cannabinoid Consumption Leading
Slide 5: TPB is a Consumer Products company that markets strong brands
TPB is a Consumer Products company that markets strong brands BROAD PORTFOLIO OF ICONIC AND EMERGING BRANDS Turning Point Brands (NYSE: TPB) 5 | 5 2 0 1 I N T E R C H A N G E W A Y , L O U I S V I L L E K Y | T U R N I N G P O I N T B R A N D S . C O M |
Slide 6: Efficient Manufacturing, Supply & Distribution Model
Efficient Manufacturing, Supply & Distribution Model Turning Point Brands (NYSE: TPB) 6 | 5 2 0 1 I N T E R C H A N G E W A Y , L O U I S V I L L E K Y | T U R N I N G P O I N T B R A N D S . C O M |
Slide 7: Powerful Distribution Infrastructure
Powerful Distribution Infrastructure • Extensive Distribution Network and Data Driven Sales Organization • North American retail presence that reaches over ~217,000 outlets + B2C online sites Turning Point Brands (NYSE: TPB) National Regional Product B2C B2B Distribution Sales Teams Sales Teams Dist
Slide 8: TPB Business Segments
TPB Business Segments Zig-Zag Products Stoker’s Products Rolling papers and Make-Your-Own (“MYO”) cigar wraps Loose leaf chewing tobacco, moist snuff tobacco, and white nicotine pouches LTM Q3 24 $192mm $158mm Turning Point Brands (NYSE: TPB) Key Brands • Sustainable growth • Capitalize on strong gr
Slide 9: Zig Zag Products: Iconic Brand with Leading Market Share
Zig Zag Products: Iconic Brand with Leading Market Share About Zig-Zag Papers Wraps New Product Launches Embedded into pop culture #1 premium and overall Market leader in MYO cigar Continued roll-out of paper with a storied history that rolling paper brand sold in wraps with a majority share cones,
Slide 10: Zig Zag Products: Continued Profit and Margin Growth
Zig Zag Products: Continued Profit and Margin Growth Growth initiatives focused on new product introductions and channel expansions aligned with secular market growth trends Net Sales ($M) Adjusted Gross Profit ($M) Turning Point Brands (NYSE: TPB) $190 $192 $107 $107 $103 $101 $180 $176 $78 $133 $5
Slide 11: Stoker's Products: Iconic Brand with Sustained Growth
Stoker’s Products: Iconic Brand with Sustained Growth About Stoker's MST TUBS MST Cans Chew FRĒ Pouches Building brand equity for Introduced a larger tub Accelerating strength #1 discount and overall Scaling product mix via over 80 years. Stoker’s is format Moist Snuff from distribution gains loose-
Slide 12: Stoker's Products: Continued MST Distribution Gains
Stoker’s Products: Continued MST Distribution Gains Long Runway for Growth Currently in stores representing ~67%1 of volume weighted 78.6 81.7 distribution 77.4 77.6 Turning Point Brands (NYSE: TPB) 70.4 Additional ~30-50k stores targeted 61.6 63.1 57.0 for national distribution 41.4 2015 2016 2017
Slide 13: Stoker's Products: Continued Profit and Margin Growth
Stoker’s Products: Continued Profit and Margin Growth Smokeless Net Sales and Gross Profit have shown steady growth with operating leverage driven by MST volume and pricing gains. Net Sales ($M) Adjusted Gross Profit ($M) Turning Point Brands (NYSE: TPB) $158 $89 $145 $82 $131 $71 $124 $68 $116 $62
Slide 14: Modern Oral Market – FRE
Modern Oral Market – FRE Significant opportunity with FRĒ in a large and growing market • The modern oral market is trending towards a $3 billion market in 2024 with strong growth trajectory Modern Oral Market Size • FRĒ has a differentiated offering through its product 250 100% quality (POWER. FEEL
Slide 15: Financial Update
Turning Point Brands (NYSE: TPB) Financial Update 15 | 5 2 0 1 I N T E R C H A N G E W A Y , L O U I S V I L L E K Y | T U R N I N G P O I N T B R A N D S . C O M |
Slide 16: Recent Business Performance
Recent Business Performance Solid Performance from our Zig-Zag and Stoker’s businesses Recent • Q3 2024 Financial Results: Net Sales of $105.6 million (+3.8% YoY) and Adjusted EBITDA 1 of $27.2 million (+11.3% YoY) Performance • Net Sales for Zig-Zag increased +5.5% YoY • Net Sales for Stoker’s incr
Slide 17: Expanding Addressable Markets
Expanding Addressable Markets Extending into large, adjacent markets provides runway for growth End Market Market Size1 Opportunity ($ Millions) White Nicotine Pouch >$3,000 Introduce FRE including differentiated higher nicotine content offerings into a rapidly growing market Turning Point Brands (N
Slide 18: Historical Financials (Includes CDS)
Historical Financials (Includes CDS) Net Sales Adjusted EBITDA $445 $108 $104 $405 $415 $405 $408 $98 $95 $362 $90 $67 2019 2020 2021 2022 2023 LTM 2019 2020 2021 2022 2023 LTM Turning Point Brands (NYSE: TPB) Q3'2024 Q3'2024 % Growth 8.8% 11.9% 9.8% (6.7%) (2.3%) 0.8% % Margin 18.6% 22.3% 24.3% 23.
Slide 19: EBITDA Adjustment Detail
EBITDA Adjustment Detail Reconciliation of GAAP Net Income to Adjusted EBITDA ($ in millions) 2019 2020 2021 2022 2023 Q124 Q224 Q324 Consolidated Net Income 13.8 33.4 52.1 11.6 38.5 12.0 13.0 12.4 Interest Expense, Net 17.3 20.2 20.5 19.5 14.6 3.5 3.0 3.8 Gain on Extinguishment of Debt 1.3 - (2.2)
Slide 20: Thank You
Turning Point Brands (NYSE: TPB) THANK YOU 20 | 5 2 0 1 I N T E R C H A N G E W A Y , L O U I S V I L L E K Y | T U R N I N G P O I N T B R A N D S . C O M |