Sprouts Farmers Market, Inc. · NASDAQ:SFM
Sprouts Farmers Market — Investor Presentation (September 2013)
24 slides from Sprouts Farmers Market's investor presentation, Sep 10, 2013
Slide 1: Investor Presentation September 2013
Investor Presentation September 2013 Exhibit 99.1 Investor Presentation September 2013
Slide 2: Forward-Looking Statements and Non-GAAP Financial Measures
Forward-Looking Statements and Non-GAAP Financial Measures Forward-Looking Statements and Non-GAAP Financial Measures Certain statements in this presentation are forward-looking as defined in the Private Securities Litigation Reform Act of 1995. Any statements contained herein (including, but not li
Slide 3: Introduction to Sprouts
Introduction to Sprouts Doug Sanders – President & Chief Executive Officer Amin Maredia – Chief Financial Officer Introduction to Sprouts Doug Sanders – President & Chief Executive Officer Amin Maredia – Chief Financial Officer
Slide 4: Why Sprouts is a Compelling Investment
Why Sprouts is a Compelling Investment Why Sprouts is a Compelling Investment Authentic Natural and Organic Food Offering at Great Value Fast Growing Segment of the U.S. Supermarket Industry with Strong Macro Tailwinds Significant New Store Growth Opportunity Supported by Broad Demographic Appeal Pr
Slide 5: Sprouts has a Differentiated Go-to-Market Strategy
Selection Service Value Health Sprouts has a Differentiated Go-to-Market Strategy An Engaged, Loyal Customer Base Leading to Strong Financial Performance and Significant New Unit Growth Opportunity Complete Natural & Organic Offering Sprouts has a Differentiated Go-to-Market Strategy
Slide 6: Sprouts “Flips” the Conventional Grocery Store Model
Sprouts “Flips” the Conventional Grocery Store Model Sprouts “Flips” the Conventional Grocery Store Model Produce surrounded by a complete grocery offering Farmers market open store layout with low profile displays Convenient, small-box: 25-28k sq ft Comfortable, easy to shop environment Full grocer
Slide 7: Fresh Produce is at the Core of Sprouts’ Offering
Fresh Produce is at the Core of Sprouts’ Offering Sprouts’ Produce is a Competitive Advantage Fresh Produce is at the Core of Sprouts’ Offering Produce is a common denominator among customers Differentiated supply chain model delivers freshness, speed-to-market and value Produce sourced and distribu
Slide 8: Estimated 15+ Years of New Store Runway
Estimated 15+ Years of New Store Runway New Mexico Texas Colorado Utah Arizona Nevada California Oklahoma Kansas Georgia Missouri Arkansas Tennessee North Carolina Oregon Washington Potential U.S. Store Count ¹ Estimated 15+ Years of New Store Runway Existing Market Target Near Term New Market Flori
Slide 9: Sprouts will Grow its Share of Consumers’ “Food Retail Wallet”
Trial Transition Lifestyle Sprouts will Grow its Share of Consumers’ “Food Retail Wallet” Over Time Increasing Average Basket Size and Gross Margin Sprouts Attracts Conventional Grocery Customers Seeking a Healthy, Natural Alternative for Less! Sprouts will Grow its Share of Consumers’ “Food Retail
Slide 10: Sprouts’ Consistent Growth in Competitive Markets
Sprouts’ Consistent Growth in Competitive Markets Broad Appeal Makes Sprouts a Formidable Competitor Sprouts’ Consistent Growth in Competitive Markets 1 Not indicative of every store location.
Slide 11: A Powerful, Long-term Growth Engine
A Powerful, Long-term Growth Engine Compelling Store-Level Economics One of the Best White Space Opportunities in the Public Markets Leverage Infrastructure for Scale and Growth 10%+ Natural / Organic Sector Growth Consistent Store Performance Across Geographies and Vintages Comp Growth and Margin E
Slide 12: History of Organic Growth
History of Organic Growth Balanced Sales Growth across Comparable Store Sales Growth and New Unit Openings Pro Forma Net Sales ² Pro Forma Comparable Store Sales G rowth History of Organic Growth “Comparable store sales growth” refers to the percentage change in our comparable store sales as compare
Slide 13: Compelling New Store Level Economics
Compelling New Store Level Economics Target New Store Economics Pre-Tax Cash-on-Cash Returns 35-40% within 3-4 years Compelling New Store Level Economics Includes store buildout (net of contributions from landlords), inventory (net of payables) and cash pre-opening expenses. Store Size 25-28k sq. ft
Slide 14: Strong Sales Momentum Continued into 2Q13
Strong Sales Momentum Continued into 2Q13 Pro Forma Net Sales ² Pro Forma Comparable Store Sales Growth ³ Strong Sales Momentum Continued into 2Q13 For stores under our management Pro forma net sales reflect the net sales of Sunflower as if the Sunflower Transaction had been consummated on the first
Slide 15: Converting Strong Sales Performance into Robust Earnings Growth
Converting Strong Sales Performance into Robust Earnings Growth Converting Strong Sales Performance into Robust Earnings Growth See the Appendix to this presentation for a reconciliation of pro forma adjusted EBITDA to pro forma net income. See the Appendix to this presentation for a reconciliation
Slide 16: Strong Balance Sheet and Liquidity
Strong Balance Sheet and Liquidity Net Debt to Adjusted EBITDA of 2.5x (1) Strong Balance Sheet and Liquidity Calculation is after taking into account a $340M pay down of Term Loan indebtedness with the proceeds from the IPO in August 2013. Net debt is inclusive of capital leases. $340M net proceeds
Slide 17: 2013 Financial Targets
2013 Financial Targets Unit Growth 19 New Stores Comparable Store Sales Growth 8.5% - 9.0% Total Net Sales Growth 19% - 21% Adjusted EBITDA $180M - $185M Adjusted Net Income $57M - $60M Adjusted Diluted EPS $0.41 - $0.43 Capital Expenditures (net of Landlord reimbursements) $70M - $75M 2013 Financia
Slide 18: Long Term Financial Targets
Long Term Financial Targets Unit Growth ~12% Comparable Store Sales Growth 6%+ Total Sales Growth ~15% EBIT Growth 17-20% Net Income Growth 20%+ Long Term Financial Targets
Slide 19: Appendix: GAAP Reconciliations and Pro Forma Information
Appendix: GAAP Reconciliations and Pro Forma Information Appendix: GAAP Reconciliations and Pro Forma Information
Slide 20: Non-GAAP
Non-GAAP Non-GAAP (a) See “Unaudited Supplemental Pro Forma Condensed Consolidated Financial Information” for a reconciliation of proforma net income to net income for the thirteen and twenty-six weeks ended July 1, 2012. (b) Store closure and exit costs have been excluded from adjusted and pro form
Slide 21: Pro forma Reconciliation
Pro forma Reconciliation Pro forma Reconciliation SPROUTS FARMERS MARKET, INC. UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS For the Thirteen Weeks Ended July 1, 2012 (in thousands, except per share amounts) Historical Sprouts Farmers Market, Inc.(1) Historical Sunflower(1) Pro
Slide 22: Pro forma Reconciliation
Pro forma Reconciliation Pro forma Reconciliation SPROUTS FARMERS MARKET, INC. UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS For the Twenty-Six Weeks Ended July 1, 2012 (in thousands, except per share amounts) Historical Sprouts Farmers Market, Inc.(1) Historical Sunflower(1) Pr
Slide 23: Pro forma Reconciliation
Pro forma Reconciliation Pro forma Reconciliation SPROUTS FARMERS MARKET, INC. NOTES TO UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL INFORMATION 1. Basis of Presentation and Description of Transactions * * * Effective May 29, 2012, the Company acquired all of the outstanding common and prefe
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