Utz Brands Inc · NYSE:UTZ
Utz Brands — Investor Day (December 2023)
111 slides from Utz Brands's investor day presentation, Dec 15, 2023
Slide 1: Utz Brands 2023 Investor Day Presentation
Utz Brands, Inc. 2023 Investor Day Presentation December 15, 2023
Slide 2: Disclaimer
Disclaimer Forward-Looking Statements Certain statements made herein are not historical facts but are “forward-looking statements” within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995, as amended. The forward-looking statements generally are acco
Slide 3: Disclaimer (continued)
Disclaimer (continued) Industry and Share Data This presentation includes information and statistics regarding market participations in the sectors in which the Company competes and other industry data which was obtained from third-party sources, including reports by market research firms and compan
Slide 4: Agenda
Agenda Welcome Kevin Powers Strategy Overview Howard Friedman Next Phase of Growth Jen Bentz Mark Schreiber Supply Chain Cary Devore Value Creation Shannan Redcay Chad Whyte Financial Review Ajay Kataria Q&A All Presenters 4
Slide 5: Strategy Overview
Strategy Overview Howard Friedman Chief Executive Officer 5
Slide 6: Key messages you will hear today
Key messages you will hear today ONE TWO Building on our strong Transforming our supply chain to foundation and consumer- fuel margin improvement while loved brands for next phase prioritizing high-return growth of growth investments THREE FOUR Maintaining a disciplined Introducing new 2026 financia
Slide 7: National scale, multi-brand snack platform created 2011–23
National scale, multi-brand snack platform created 2011 – 2023 o Rapid geographic and brand portfolio expansion driven by strategic M&A o Publicly traded company through business combination with Collier Creek Holdings in August 2020 2021 2020 Geographic Expansion Aug. 2020 Tortilla/ Geographic 2019
Slide 8: Consumer-loved brand portfolio
Consumer-loved brand portfolio 8
Slide 9: Growth fueled by distribution gains, new buyers, and acquisitions
Growth fueled by distribution gains, new buyers, and acquisitions Total Utz Growth from 2019 to 2023 Consumption Growth Distribution Growth Household Growth Retail Sales Total Points of Distribution Total Buyers 9.6% 5% +3.5M CAGR Since 2019 CAGR Since 2019 Since 2019 Source: Circana Total US MULO-C
Slide 10: Momentum led by our Core Four Power Brands
Momentum led by our Core Four Power Brands 2019 - 2023 Retail Sales CAGR 11% 14% 21% 21% ACV% Growth (national 17pts 20pts 20pts 6pts distribution) 10 Source: Circana Total US MULO-C 2019 to 2023; 2023 period is 52-weeks ended 11/5/23. Pro forma for acquisitions. Boulder Canyon retail sales growth i
Slide 11: This year we positioned the Company to capture its full potential
This year we positioned the Company to capture its full potential o Acquired new talent in key areas o Accelerated productivity delivery o Invested in supply chain optimization program o Completed accelerated SKU rationalization program and continued IO route conversions o Continued progress on buil
Slide 12: What we want to achieve
What we Our Mission: Become the fastest growing pure-play U.S. want to snacking company of scale achieve By: o Building a portfolio of consumer-loved brands coast-to-coast o Developing world class people and capabilities o Delivering top-tier financial performance 12
Slide 13: Driven by our fundamental strategies
Driven Focus our portfolio Transform by our to further penetrate our Expansion our supply chain to fund growth fundamental geographies while holding the Core and margin improvement strategies Develop leading Improve balance capabilities sheet flexibility to build a and pursue best-in-class opportuni
Slide 14: Strategies planned to deliver strong three-year financial targets
Strategies planned to deliver strong three-year financial targets 4% to 5% ~16% Double-digit ~3x Organic Net Adj. EBITDA Adj. EPS Growth Net Sales Growth Margin Leverage CAGR 2023 - 2026 In 2026 CAGR 2023 – 2026 By year-end 2026 Three-year targets expected to drive top-tier shareholder returns Note:
Slide 15: 4% – 5% Organic Net Sales growth targeted over the next three years
4% – 5% Organic Net Sales growth targeted over the next three years Participate in Increase Further penetrate Leverage attractive and investments against our Expansion our go-to-market growing Salty Snack a clearly defined geographies model with category brand portfolio while holding operational str
Slide 16: Targeting ~300bps of Adj. EBITDA Margin improvement
Targeting ~300bps of Adj. EBITDA Margin improvement over the next three years Adjusted EBITDA Margin ~16% o Volume-led revenue growth driving ~13% 12.1% fixed cost leverage o Advantaged product mix through portfolio management o Supply chain transformation o Investments to support leading organizati
Slide 17: Our culture permeates our ways of working
Our culture permeates our ways of working 1 Act with respect, care, and inclusion 2 Focus on accountability and results 3 Celebrate and reward successes 4 Continuously pursue excellence 17
Slide 18: ESG priorities that strengthen our business
ESG priorities that strengthen our business People Planet Products o Creating a culture where most o Prioritizing energy efficiency to o Delivering product safety and talented people want to work for cut costs and manage GHG ingredient sustainability and stay emissions ensures trust in our brands o
Slide 19: Key messages you will hear today
Key messages you will hear today ONE TWO Building on our strong Transforming our supply chain to foundation and consumer- fuel margin improvement while loved brands for next phase prioritizing high-return growth of growth investments THREE FOUR Maintaining a disciplined Introducing new 2026 financia
Slide 20: Next Phase of Growth
Next Phase of Growth Jennifer Bentz Mark Schreiber EVP, Marketing EVP, Chief Customer Officer 20
Slide 21: Key assumptions underlying 4%–5% Organic Net Sales CAGR
Key assumptions underlying 4% – 5% Organic Net Sales CAGR 2023 – 2026 Salty Snacks Category Utz Expansion Geography Utz Core Geography Retail Sales Growth Volume Share Growth Volume Share 2%–3% 0.2 pts Flat CAGR Average per year 21
Slide 22: Strategies to deliver 4% – 5% Organic Net Sales
o Participate in attractive and growing salty snack category o Increase investments against a clearly defined brand portfolio strategy Strategies to o Further penetrate our Expansion geographies while deliver 4% – 5% holding the Core Organic Net Sales o Leverage our go-to-market model with operation
Slide 23: Salty Snacks is an advantaged category with above average growth
Salty Snacks is an advantaged category with above average growth 2019–2023 U.S. Retail Sales Growth(1) 10.1% 8.7% 7.8% 7.3% 7.2% 5.0% 4.6% Salty Store Candy Cookies Crackers Snack Bars Ice Cream Snacks Edibles and Granola and Bars Sherbet Unit 4-Year 0.9% 0.0% (1.7%) 0.9% 1.8% 6.0% 0.1% CAGR(2) (1)
Slide 24: Drivers of Salty Snacks growth still true even with value conscious consumers
Drivers of Salty Snacks growth still true even with more value conscious consumers Salty Snacks Category Drivers Tailwinds Headwinds 90% U.S. population snacking at least once per day(1) +30% CPG prices higher than 2019; 3.3 Avg # snacks wage growth hasn’t kept up(3) per day per person(1) 33% of U.S
Slide 25: Higher prices a drag on unit sales but Salty Snacks resilient
Higher prices a drag on unit sales but Salty Snacks have been resilient All outlets combined: Top selling edible super-categories unit price & unit trend Latest 52-weeks vs. 2 years ago % Change Average Unit Price % Change in Unit Sales Cookies & Crackers 29.0% -7.3% Cereal & Granola 28.2% -8.2% Can
Slide 26: Utz growth outlook not dependent on category returning to historical growth
Utz growth outlook not dependent on Salty Snack category returning to historical growth Historical and Projected Salty Snacks Category Growth (CAGR) 2023 – 2026 Projection Pre-Pandemic Pandemic/Inflation Return to Utz 2016 – 2019(1) 2019 – 2023(1) Historical(2) Assumption 10.1% 1.1% 4–5% 4.7% 1–2% 2
Slide 27: Utz historical portfolio volume growth of 2% – 3%
Utz historical portfolio volume growth of 2% – 3% 2019–2023 U.S. Retail Volume CAGR 3.4% 2.2% 1.1% Salty Snacks Utz Power Brands Total Utz Source: Circana Total US MULO-C 52-weeks ended 11/05/23. Pro forma for acquisitions. 27
Slide 28: Strategies to deliver 4 – 5% Organic Net Sales
o Participate in attractive and growing salty snack category o Increase investments against a clearly defined brand portfolio strategy Strategies to o Further penetrate our Expansion geographies while deliver 4 – 5% holding the Core Organic Net Sales o Leverage our go-to-market model with operationa
Slide 29: Successfully shifted sales mix to advantaged Power Brands
Successfully shifted sales mix to advantaged Power Brands o De-emphasized private label and partner brands o Eliminated ~450 (or ~25% of total) SKUs 2021 to 2023 Total Utz Sales(1) 2020 2023(2) Foundation Brands Foundation Brands (includes private (includes private label and partner label and partne
Slide 30: Power Brands strong in measured and unmeasured channels
Utz Power Brands strong in both measured and unmeasured channels Utz Power Brands Sales o Power Brand unmeasured 10.3% sales growth driven by 8.5% Club, Dollar, and Natural channel o Expect future Power Brand growth to be similar between measured and unmeasured channels 2023 Measured Unmeasured Sour
Slide 31: Power Brands further segmented with focus on Core Four
Power Brands now further segmented with focus on Core Four Power Brands Total Utz Retail Sales 52-weeks ended 11/5/23 YoY Growth % of Total Utz Power Brands Core Four 9% 69% 34% 8% Targeted Pork - 12% Foundation (2%) 11% Brands All Other Total Utz 8% 100% Source: Circana Total US MULO-C 52-weeks end
Slide 32: Investments in marketing and innovation focused on Growth Power Brands
Investments in marketing and innovation focused on Growth Power Brands Future Portfolio Role Investment Geography Power Brands Core Four o Mainstream Salty Snacks Above National o Tortilla fair share o High flavor Significantly National o Better-for-You above fair share Targeted o Specific sub-categ
Slide 33: Consumers have distinct attitudes and needs towards snacking
Consumers have distinct attitudes and needs towards snacking How: Salty Snack consumers can be defined across three major traits Foodie Functional Adventurous Snacker Snacker Snacker Those driven by Those eating for Those eating for taste and those social connection taste and those driven by health
Slide 34: Portfolio breadth reaches consumers on how and when they snack
Utz portfolio breadth reaches consumers both on HOW and WHEN they snack How Foodie Functional Adventurous Snacker Snacker Snacker Craving Taste & Occasions When Social Energize & On the Go 34
Slide 35: Investment increasing across all aspects of Marketing
Investment increasing across all aspects of Marketing OPTIMIZE AMPLIFY ELEVATE Investing in sales overnight and brands over time 35
Slide 36: OPTIMIZE retail media to support brand expansion
OPTIMIZE retail media to support brand expansion Deploy high ROI promotions Leverage retail media Munch & mingle Bring the family together with classic, tasty snacks. Shop now 36
Slide 37: AMPLIFY marketing investment
AMPLIFY marketing investment Utz Brands Marketing Investment +40% +40% +40% 2023E 2024E 2025E 2026E 37
Slide 38: AMPLIFY investment in digital commerce capabilities
AMPLIFY investment in digital commerce capabilities Ecommerce Retail Sales Growth Rolling 12-week periods year-over-year change 25% 22% 22% 19% 20% 20% 18% 19% 18% 19% 7/16/2023 8/13/2023 9/10/2023 10/8/2023 11/5/2023 Salty Snacks Utz Brands Source: Circana Total E-Commerce With ePOS rolling 12-week
Slide 39: AMPLIFY investment in new product innovation
AMPLIFY investment in new product innovation Deliver Capture Expand “Craveable” Flavor Occasions Positive Choices 39
Slide 40: AMPLIFY with on-trend innovation: Utz Mike's Hot Honey
AMPLIFY with on-trend innovation supporting growth: Utz Mike’s Hot Honey® o Hot & Spicy is the #1 flavor in Salty Snacks, and growing nearly twice the rate of the category(1) o Utz Mike’s Hot Honey® potato chips $ sales 5x higher than previously best Utz limited time offer(2) o Strong weekly velocit
Slide 41: ELEVATE Power Brand equity to build brand affinity
ELEVATE Power Brand equity to build brand affinity 41
Slide 42: Utz targeting to be a $1 billion retail sales brand
Utz® targeting to be a $1 billion retail sales brand in three years Brand New Cross-Category Opportunity Campaigns Innovation Growing 1.3x the sub- Category Fresh Brand Voice Source: Circana Total US MULO-C 52-weeks ended 11/5/23. 42
Slide 43: On The Border targeting to be a $500 million brand
On The Border® targeting to be a $500 million retail sales brand in three years Brand Social & Opportunity Shopper Focus Innovation #2 Unflavored Tortilla Chip Brand Growing 3X the Category(1) Source: Circana Total US MULO-C 52-weeks ended 11/5/23. Total U.S. MULO-C L26 11/5/23 vs Unflavored Tortill
Slide 44: Zapp's targeting to be a $200 million brand
Zapp’s® targeting to be a $200 million retail sales brand in three years Brand New Opportunity Campaign Innovation Voodoo growth 2.5X kettle potato chips (1) Extension into pretzels highly incremental Source: Circana Total US MULO-C 52-weeks ended 10/8/23. 4-year CAGR is Voodoo Kettle vs. Total Kett
Slide 45: Boulder Canyon targeting to be a $100 million brand
Boulder Canyon® targeting to be a $100 million retail sales brand in three years Brand Geotarget Opportunity Investment Innovation #1 and #2 Potato Chips in the Natural Channel Source: Total Natural Channel SPINS. YTD weeks ending 10/8/23. 45
Slide 46: Strategies to deliver 4% – 5% Organic Net Sales
o Participate in attractive and growing salty snack category o Increase investments against a clearly defined brand portfolio strategy Strategies to o Further penetrate our Expansion geographies while deliver 4% – 5% holding the Core Organic Net Sales o Leverage our go-to-market model with operation
Slide 47: Most significant opportunity is in our Expansion geographies
Most significant opportunity is in our Expansion geographies Retail Sales WA 52-weeks ended 11/5/23 MT ME ND OR MN VT NH Core Expansion Total US ID SD WI NY MA WY MI CT RI NV NE IA IL IN OH PA NJ $ CAGR 2019-2023 DE UT CO WV MD CA KS MO VA DC Salty Snacks 10.0% 10.3% 10.1% KY NC TN AZ OK NM AR SC GA
Slide 48: Demonstrated ability to grow through distribution gains
Demonstrated ability to grow through distribution gains Expansion Geographies WA ME Total Points of MT Retail Sales Distribution Growth ND VT OR MN CAGR 2019 - 2023 2023 vs. 2019 NH ID SD WI NY MA WY MI CT RI IA PA NE NJ NV UT CO IL IN OH WV DE Salty Snacks 10.3% 14% MD CA KS MO VA KY DC AZ OK TN NC
Slide 49: Large distribution opportunities remain
Large distribution opportunities remain Expansion Geographies 52-weeks ended 11/5/23 Avg. Items ACV% Carried Distribution On-Shelf Total Utz 92% 14.9 Utz 64% 7.8 On The Border 68% 3.7 Zapp’s 42% 3.6 Boulder Canyon 28% 4.0 Source: Circana Total US MULO-C 52-weeks ended 11/5/23. 49
Slide 50: Developed playbook to enter new Expansion geographies
Developed playbook to enter new Expansion geographies Target Power Brands with Major Route Large Markets local favorites Retailers to Market o Under-indexed o Grocery-led o Both DSD and DTW large population o All Channels o Third-party master areas distributors o Route expansion 50
Slide 51: The playbook has a track record of success
The playbook has a track record of success 2019 to 2022 Gains Retail Sales $ Avg HH Growth TPD Share % Household % CAGR (pts/year) 0.7 → 1.9 12.2 → 19.9 23% 2.6 U.S. Plains U.S. 0.5 → 1.0 4.8 → 7.1 18% 0.8 Southeast 0.2 → 0.3 1.9 → 3.7 34% 0.6 California Source: Circana CSIA and MULO-C data last 52-
Slide 52: Actively developing key underpenetrated Expansion regions
Actively developing key underpenetrated Expansion regions UBI vs Salty Subcat % HH Penetration WA Great Lakes West MT Subcat Utz ME ND Subcat Utz Potato Chips 92 17 VT Potato Chips OR 90 20 Plains Tortilla Chips 89 21 VT MN WI NH Tortilla Chips 90 ID 15 SD Subcat Utz WI Pretzels 66 10 NY MA Pretzels
Slide 53: Retailers in Expansion geographies want to sell our Power Brands
Retailers in Expansion geographies want to sell our Power Brands complemented by our local favorites o Product range links to shopper needs o Brand portfolio resonates with retailers’ most loyal shoppers o Incremental to retailer Salty Snack Category sales o Right route-to-market and portfolio to so
Slide 54: Product range that addresses category shifts and shopper needs
Product range that addresses category shifts and links to shopper needs Craft Convenience Local Favorites BFY / Snacks Seasonal On-trend portfolio of brands Multiple forms Relevant with Benefits Optimize incremental with national success for all occasions to consumers Healthier snacking oopportuniti
Slide 55: Driving incrementality to retailers' Salty Snack category sales
Driving incrementality to retailers’ Salty Snack category sales by resonating with their most loyal shoppers Customization Loyal Shoppers Incrementality o Limited assortment o Loyal shoppers to Kroger 10x o Utz chain-wide expansion to o Direct-to-warehouse more valuable(1) ~1,300 stores in May 2022
Slide 56: A product portfolio suitable for a broad range of channels
A product portfolio suitable for a broad range of channels Utz Brands has both national brands and brands that have local relevance to meet all customers’ needs Convenience sizes that Unique, Club Sizes drive trial National Brands, local Right brands and right size relevance to fit right price point
Slide 57: Hybrid go-to-market: Grocery and Convenience
Brand portfolio enables and hybrid go-to-market allows customization for Expansion retailers Grocery Convenience DSD Strength Local Favorites DSD/DTW Hybrid 57
Slide 58: Hybrid go-to-market: Mass and Club
Brand portfolio enables and hybrid go-to-market allows customization for Expansion retailers Mass Club DSD with DTW 100% DTW for Efficiency Perimeter Displays on Club Packs 58
Slide 59: Hybrid go-to-market: Dollar and Hard Discount
Brand portfolio enables and hybrid go-to-market allows customization for Expansion retailers Hard Dollar Discount DTW to Win with Seasonal DSD Coverage 59
Slide 60: Hybrid go-to-market: Vend, Natural, Foodservice
Brand portfolio enables and hybrid go-to-market allows customization for Expansion retailers Vend Natural Foodservice Third-Party Distributors Kehe/UNFI 60
Slide 61: Core Four distribution in Expansion geographies generating 2% CAGR volume growth
Increasing Core Four Power Brand distribution in Expansion geographies generating 2% CAGR incremental total Utz volume growth 2023 - 2026 Expansion Geographies Incremental Impact Household Expansion Nationally Distribution Penetration Volume 4% CAGR 2% CAGR TPD Share(1): %HH: 3.2% -> 4.4% +6pts Shar
Slide 62: Strategies to deliver 4% – 5% Organic Net Sales
o Participate in attractive and growing salty snack category o Increase investments against a clearly defined brand portfolio strategy Strategies to o Further penetrate our Expansion geographies while deliver 4% – 5% holding the Core Organic Net Sales o Leverage our go-to-market model with operation
Slide 63: Holding share in Core geographies requires Core Four growth
Holding share in Core geographies requires Core Four Power Brand growth to offset potential declines in Foundation Brands Core Geographies 2023–26 % of Retail Retail Sales Share Share Change Sales 2019–23 Share Change vs. Required to 2023 CAGR 2023 2019 Hold Share Core Four 76% 11.1% 5.6% 0.2pts 0.3
Slide 64: Significant opportunity in Core geographies to build distribution
Significant opportunity in Core geographies to build distribution leveraging Utz® strength Core Geographies 52-weeks ended 11/5/23 ACV% Avg. Items Distribution Carried On-Shelf Total Utz 95% 33.7 Utz 84% 23.4 On The Border 67% 3.0 Zapp’s 54% 3.1 Boulder Canyon 16% 3.0 Source: Circana Total US MULO-C
Slide 65: Our Core requires continued brand investment and route expansion
Our Core requires continued brand investment, route expansion and increased points of distribution Improve talent Increase Marketing Enhance route Gain distribution and capabilities spend and infrastructure for core SKUs in innovation key channels 65
Slide 66: Greatest Core retailer opportunity in Mass and Club channels
Greatest Core geography retailer opportunity in Mass and Club channels Retail Sales Share by Major Channel in Core Geographies 52-weeks ended 11/5/23 Food 50.6% 10.0% 9.7% Total Utz 4.0% 2.9% Core Share Peer 1 Peer 2 ℠ Peer 3 Peer 4 of 7.3% C-Store 60.5% Total Utz 6.0% Core Share 5.2% 3.4% 3.0% of 7
Slide 67: Successfully increased penetration of On The Border into our Core
Successfully increased penetration of On The Border® into our Core Acquired On The Border chips and dips in December 2020 o Our DSD-led distribution into our Core o Delivered exceptional outperformance vs the sub-category in the Grocery Channel and Northeast Region Retail Sales CAGR Total Points of
Slide 68: Strategies to deliver 4% – 5% Organic Net Sales
o Participate in attractive and growing salty snack category o Increase investments against a clearly defined brand portfolio strategy Strategies to o Further penetrate our Expansion geographies while deliver 4% – 5% holding the Core Organic Net Sales o Leverage our go-to-market model with operation
Slide 69: Dynamic go to market approach across retail channels
Dynamic go to market approach with broad distribution across retail channels Utz Retail Sales by Channel Utz Sales by Go-to-Market(1) 52-Weeks Ended November 5, 2023 (2) Distributors Other ~600 ~10% Direct-to-Store Club 7% Routes (DSD) 8% ~2,250+ C-Store 15% Direct-to- ~50% Total Routes Warehouse ~4
Slide 70: DSD is a critical route-to-market for Utz
DSD is a critical route-to-market for Utz Why retailers like DSD Why we like DSD o Healthy margins o Critical for maintaining o In-store service competitive position with retailers o Localized assortment o More control on shelf o Speed to market o Responsive to key events and demand surges o Speed t
Slide 71: Shifted DSD routes from Company-owned to Independent Operator
Utz has shifted mix of DSD routes from Company-owned to Independent Operator 2016 – 2023 Utz Mix of DSD Routes (1) # of DSD ~1,100 ~1,250 ~1,300 ~1,400 ~1,700 ~1,850 ~2,150 ~2,250 Routes 30% 48% 60% 80% 80% 90% 95% 99% 70% 52% 40% 20% 20% 1% 10% 5% 2016 2017 2018 2019 2020 2021 2022 2023 Company-Own
Slide 72: Independent Operator DSD model ensures strong store-level execution
Independent Operator DSD model ensures strong store-level service and execution Independent operator incentives aligned with Utz objectives o Earning a commission on every dollar sold o Entrepreneurial aspect; IOs own their own routes and have equity Lower capital intensity and ~2,250 DSD Routes ~15
Slide 73: Technology enhancements to improve execution
Continuing to make technology enhancements to improve execution o Income & equity Independent o Auto ordering Operators o Game-based incentives o Performance & potential Frontline o Perfect store measures Leadership o Time and talent o AI-generated selling tools Account Account o Analytics & insight
Slide 74: Strategies to deliver 4% – 5% Organic Net Sales
o Participate in attractive and growing salty snack category o Increase investments against a clearly defined brand portfolio strategy Strategies to o Further penetrate our Expansion geographies deliver 4% – 5% while holding the Core Organic Net Sales o Leverage our go-to-market model with operation
Slide 75: Utz top line outlook 2023–2026 outpaces projected Salty Snack category
Utz top line outlook for 2023 – 2026 outpaces projected Salty Snack category with Utz retail sales growth of 4% - 5% 2023 – 2026 Growth Outlook Salty Snack Category Utz CAGR CAGR Share Volume Volume +0-1% +2-3% Geography Change CAGR Core 0.0pp +0-1% Price +2% +2% Expansion 0.2pts/year +3-5% Retail S
Slide 76: Supply Chain Value Creation
Supply Chain Value Creation Cary Devore EVP, Chief Operating & Transformation Officer Shannan Redcay EVP, Manufacturing Chad Whyte EVP, Supply Chain 76
Slide 77: Key Takeaways
Key Takeaways ONE TWO Transforming our supply Scaling productivity initiatives chain into a more cost- well; foundation established efficient network but still room to grow THREE FOUR Focusing on supply chain Targeting delivery of $135M productivity, network cumulative cost savings over optimization
Slide 78: Our Supply Chain fundamental pillars
Our Supply Chain fundamental pillars Productivity Network Optimization Capability Building o Procurement o Manufacturing network o People o Manufacturing o Scaled mixing centers o Process o Logistics o Lowest total delivered cost o Technology 78
Slide 79: Achieved cost savings targets on expected timeline
Achieved cost savings targets on expected timeline Productivity Delivered (% of COGS) Productivity savings as measured by cost savings implementations (1)(2)(3) ~4% 3% 2% 1% 2020 2021 2022 2023E Actual Actual Actual (1) Excluding 2020 and 2021 acquisitions. (2) Represents cost savings realized durin
Slide 80: Strong progress in optimizing our supply chain network
Strong progress in optimizing our supply chain network Pro forma Q1 2024: 13 Manufacturing Facilities Farmington converted to distribution center May ‘22 o Reduced tortilla co-mans Bluffton from 15 to 5 sold Sept. ‘23 o In-sourced over ~60M pounds of volume previously (4 to 3) made by third parties
Slide 81: Foundational improvements to demand-supply planning
Foundational improvements to demand-supply planning driving efficiency Integrated Centralized Centralized Business Demand Supply Management Planning Planning (“IBM”) o Order-based Provides visibility to o Line-level capacity algorithmic model improve decision models o SKU-level planning making o Mos
Slide 82: Targeting cumulative $135M in cost savings over three years
Targeting cumulative $135M in cost savings(1) over the next three years Base Productivity Network Programs Optimization $90M $45M Capabilities Reduction Reduction in Cost in Cost o Lean Manufacturing o Optimize asset utilization o People o Sourcing excellence o Scale mixing centers o Process o Autom
Slide 83: Robust productivity to continue by accessing new areas
Expect robust productivity to continue by accessing new areas of opportunity Sources of Base Productivity – 2024 to 2026(1) Key Drivers Procurement o Sourcing excellence Procurement 40% 45% o Supplier relationship management o Value engineering o Simplification Manufacturing Efficiencies Manufacturi
Slide 84: Building our procurement capabilities to world-class
Building our procurement capabilities to world-class Sourcing Supplier Relationship Value Excellence Management Engineering o Category spend o Supplier harmonization o Commercialization management o Performance programs o Technology for better management o Design to value visibility o Improved colla
Slide 85: Automation is a significant source of efficiency in Manufacturing
Automation is a significant source of efficiency in Manufacturing Efficiency Improvements o Fully manual case packing, We are palletizing, conveying leveraging o Rate limiting step packaging Upskilled automation Workforce o Highest source of turnover to drive down costs o Consumes most direct labor
Slide 86: Demonstrated success with automation projects
Demonstrated success with automation projects Pretzel Rod Packaging Variety Pack Automation Small Bag Packaging o 50% headcount reduction o Flat headcount o 50% headcount reduction o 25% rate improvement o 70% rate improvement o 200% rate improvement o Enabled additional volume o Significant volume
Slide 87: Transform our Plant Network into a best-in-class operation
Through these efforts we expect to transform our Plant Network into a best-in-class operation Overall Equipment Net Sales Utilization Effectiveness (OEE) per Plant Investment in scale production facilities supporting national expansion efficiency Target Target Target o Additional subcategory product
Slide 88: Scale mixing centers create efficiencies and streamline customer service
Scale mixing centers will create efficiencies and streamline customer service Benefits Improved Carrying Cost Labor Faster Case Fill Rate Efficiency Efficiencies Inventory Turns North-East Logistics Center 650,000 sq. ft. to be completed and operational – South-West effective Q1 ‘25 Logistics Center
Slide 89: Scale mixing centers enable warehouse automation
Scale mixing centers enable warehouse automation NE Logistics Center Unlocks Technology Applications o Computer Vision for shipping, receiving and inventory accuracy o Automated trailer unloading and loading o Autonomous vehicles Highlights for pallet movement and o 650,000 sq. ft. repetitive activi
Slide 90: Building capabilities to deliver greater value in Supply Chain
Building capabilities to deliver even greater value in our Supply Chain People Process Technology Results o Ownership and accountability o Integrated work systems o Visibility, tracking, and trending 90
Slide 91: Supplier of choice for our customers
Improved capabilities will allow us to be the supplier of choice for our customers Customer Focus Digital Transformation Order Efficiencies o Customer-centric supply o No touch orders o One Order, One Invoice chain solutions o Customer supply chain o Improved ordering o Customer scorecard data syner
Slide 92: Integrated supply chain strategy expects to deliver $135M savings
Our integrated Supplier of Choice Sourcing Excellence supply chain strategy expects Integrated $135M to deliver $135M Business Continuous Management Cost Improvement Savings(1) in cost savings(1) over the next Network Optimization three years Automation (1) Cost savings is measured assuming producti
Slide 93: Financial Review
Financial Review Ajay Kataria Chief Financial Officer 93
Slide 94: Confident in our ability to deliver shareholder value
Confident in our ability to deliver both short- term and long-term shareholder value ONE TWO Growth driven by a strong brand Supply chain transformation program portfolio in an advantaged Salty expected to deliver a cumulative $135M Snack category with a significant of cost savings by year-end 2026
Slide 95: Building on a foundation of consistent growth
Building on a foundation of consistent growth Net Sales Adjusted EBITDA (in millions) (in millions) 2-Year 2-Year CAGR CAGR +11% +9% 2% - 3% 8% – 11% Growth vs. 2022 Growth vs. 2022 $1,408 $171 $1,181 $156 2021 2022 2023E(1) 2021 2022 2023E(1) Note: See appendix for reconciliation of Utz Non-GAAP fi
Slide 96: Margin improvement will begin to close gap to peers
Delivering targeted margin improvement will begin to close gap to peers Utz vs. Peers Adjusted EBITDA Margin (Trailing Twelve Months CY 3Q’23) 27.8% 22.2% 20.3% 19.8% 19.8% 19.5% Peer Median: 19% 18.5% 18.0% 16.0% 12.6% 11.6% 9.9% 8.7% Peer 1 Peer 2 Peer 3 Peer 4 Peer 5 Peer 6 Peer 7 Peer 8 Peer 9 P
Slide 97: Strategies planned to deliver strong three-year financial targets
Strategies planned to deliver strong three-year financial targets 4% to 5% ~16% Double-digit ~3x Organic Net Adj. EBITDA Adj. EPS Growth Net Sales Growth Margin Leverage CAGR 2023 - 2026 In 2026 CAGR 2023 – 2026 By year-end 2026 Three-year targets expected to drive top-tier shareholder returns Note:
Slide 98: Expect to deliver 4% – 5% Organic Net Sales growth
Expect to deliver 4% – 5% Organic Net Sales growth over the next three years Participate Increase Further penetrate Leverage in attractive investments our Expansion our go-to-market and growing against a clearly geographies model salty snack defined brand while holding with operational category port
Slide 99: Supply Chain transformation program will fuel margin improvement
Supply Chain transformation program will fuel margin improvement Continuous Network Improvement Programs Optimization $90M $45M Capabilities Reduction Reduction in Cost in Cost Expect total cost savings(1) of $135M by year-end 2026 (1) Cost savings is measured assuming production levels and costs co
Slide 100: Cost savings will also fuel continued investments in growth
Cost savings will also fuel continued investments in growth Marketing Capabilities Selling Infrastructure o Increased working o Talent o Selling tools media spend o Analytical horsepower o Route infrastructure o High ROI activities o Process automation o Front-line leadership o Consumer insights 100
Slide 101: Targeting ~300bps of Adj. EBITDA Margin improvement
Targeting ~300bps of Adj. EBITDA Margin improvement over next three years Adjusted EBITDA Margin ~16% o Volume-led revenue growth driving ~13% fixed cost leverage 12.1% o Advantaged product mix through portfolio management o Supply chain transformation o Investments to support leading organization c
Slide 102: Elevated capital spend planned for 2024–2026
Elevated capital spend planned for 2024 – 2026 to support supply chain transformation before returning to historical levels Capital Expenditures as a % of Net Sales ~5% Capital investment focus: ~4% o Continuous improvement program 3.5% ~3% o Technology and automation o Scale mixing centers and manu
Slide 103: Cash conversion cycle significantly improved
Cash conversion cycle significantly improved with additional opportunities being pursued Cash Conversion Cycle (Days) Working capital improvements driven by people, processes and technology: 32 o Procure-to-pay, improving terms with ~25 suppliers <20 o Order-to-cash, driving efficiencies in collecti
Slide 104: Expecting to reduce net leverage to ~3x by year-end 2026
Expecting to reduce net leverage to ~3x Adjusted EBITDA by year-end 2026 Net Leverage Ratio (Fiscal Year-end) 5.0x Key Drivers ~4.5x o Adj. EBITDA improvement planned through net sales growth and margin ~3.0x improvement o Prioritizing free cash flow to pay down floating rate debt o Opportunistic as
Slide 105: Maintaining a disciplined capital allocation approach
Maintaining a disciplined capital allocation approach Cash Flow Priorities o Increase brand investment to drive volume-led growth 1 Organic Business Growth o High-return manufacturing and capability investments o Targeted net leverage ratio of ~3x by year-end 2026 2 Debt Reduction o Maintain flexibi
Slide 106: Opportunistic M&A given optionality within snacking
Opportunistic M&A given optionality within the snacking category 2011 Proven track record 2014 Acquisition-savvy management team and experienced board 2016 Scalable M&A platform Significant synergy opportunities driven by highly 2017 leverageable manufacturing and distribution system 2019 Robust pip
Slide 107: Confident in our ability to deliver short-term and long-term value
Confident in our Focus our portfolio Transform ability to deliver to further penetrate our supply chain both short-term our Expansion to fund growth geographies while and margin and long-term holding the Core improvement shareholder value supported by Develop leading Improve balance our fundamental
Slide 108: Question and Answer Session
Question and Answer Session 108
Slide 109: Appendix
Appendix 109
Slide 110: Reconciliation of Non-GAAP Financial Measures to Reported Financial Measures
Reconciliation of Non-GAAP Financial Measures to Reported Financial Measures Trailing Trailing EBITDA and Adjusted EBITDA 52-weeks Ended 52-Weeks Ended 52-Weeks Ended 39-Weeks Ended 13-Weeks Ended 52-weeks Ended (dollars in millions) October 1, 2023 January 1, 2023 January 2, 2022 October 1, 2023 Ja
Slide 111: Net Debt and Leverage Ratio
Net Debt and Leverage Ratio Net Debt and Leverage Ratio (dollars in millions) As of January 1, 2023 Term Loan $779.3 Real Estate Loan 88.1 ABL Facility - Capital Leases(1) 65.0 Deferred Purchase Price 0.8 Gross Debt(2) 933.2 Cash and Cash Equivalents 72.9 Total Net Debt $860.3 Last 52-Weeks Normaliz