Del Monte Pacific Limited · SGX:D03
Del Monte Pacific — Q3 FY2016 Earnings Presentation
22 slides from Del Monte Pacific's earnings presentation, Mar 11, 2016
Slide 1: 3Q and 9M FY2016 Results
3Q and 9M FY2016 Results 11 March 2016 Del Monte Pacific Limited
Slide 2: Disclaimer
Disclaimer This presentation may contain statements regarding the business of Del Monte Pacific Limited and its subsidiaries (the “Group”) that are of a forward looking nature and are therefore based on management’s assumptions about future developments. Such forward looking statements are typically
Slide 3: Contents
Contents • Notes to the Results • 3Q FY2016 Results • 9M FY2016 Results • Market Updates • Outlook 3
Slide 4: Notes to the 3Q FY2016 Results
Notes to the 3Q FY2016 Results 1. Effective 1 May 2014, DMPL changed its financial year end to 30 April from 31 December to align with that of its US subsidiary, Del Monte Foods, Inc (DMFI). The third quarter of the Company is 1 November to 31 January. 2. DMFI’s financial results have been consolida
Slide 5: DMPL 3Q and 9M FY2016 Results Summary
DMPL 3Q and 9M FY2016 Results Summary • 3Q Group sales down 7% to US$594m with US sales down 9%, while Philippines sales higher by 6% and S&W Asia higher by 35% • 3Q Group recurring net profit of US$7.5m and reported net profit of US$0.6m better than the loss of US$2.2m last year • 9M Group sales gr
Slide 6: Non Recurring Items
Non Recurring Items In US$ m 3Q FY16 9M FY16 Booked under SAP stabilisation (7.1) (11.1) G&A expense Sager Creek integration (2.0) (4.0) G&A and other expense Severance (3.4) (6.4) G&A expense Retirement plan - 39.4 G&A expense amendment in 2Q (no tax impact) Total (pre tax basis) (12.5) 17.9 Total
Slide 7: DMPL 3Q FY2016 Results
DMPL 3Q FY2016 Results 3Q 3Q In US$m Chg (%) Comments FY 2015 FY 2016 Lower DMFI sales partly offset by strong Philippines Turnover 637.5 594.1 -6.8 and S&W Asia sales Prior year had one-off inventory step up cost of Gross profit 122.4 122.0 -0.3 US$6.2m. Lower GP mainly due to lower sales Lower G&A
Slide 8: 3Q FY2016 Turnover Analysis
3Q FY2016 Turnover Analysis Americas 77% 22% Asia Pacific Europe 1% Americas -10.5% • Unsuccessful government and OEM co-pack contract bids, and retail category contraction Asia Pacific +9.1% • Sales in the Philippines were higher by 6% and S&W by 35%, offset by weak exports of packaged pineapple du
Slide 9: DMPL 9M FY2016 Results
DMPL 9M FY2016 Results 9M 9M In US$m Chg (%) Comments FY 2015 FY 2016 Turnover 1,631.2 1,725.2 +5.8 Higher DMFI, Philippines and S&W Asia sales Prior year had one-off inventory step up cost of Gross profit 307.8 369.3 +20.0 US$44.3m. Absent that, recurring GP would still be up 5% due to better sales
Slide 10: 9M FY2016 Turnover Analysis
9M FY2016 Turnover Analysis 80% Americas 19% Asia Pacific Europe 1% Americas +6.4% • Due to higher DMFI sales mainly due to the consolidation of Sager Creek. Without Sager Creek, DMFI sales were lower by 3% due to unsuccessful government contract bids Asia Pacific +4.1% • Sales in the Philippines we
Slide 11: Del Monte Foods USA
Del Monte Foods USA • Stable market shares amidst retail category contraction and competitive behavior • DMFI’s 3Q sales down 9% in 3Q to US$466m, but higher by 8% in 9M to US$1.4bn • Unsuccessful government and OEM co-pack contract bids • Prioritised pricing and trade spend discipline over volume •
Slide 12: DMFI USA (cont'd) – Holiday Activations at Top Accounts
DMFI USA (cont’d) – Holiday Activations at Top Accounts • Display • Circular Front Page Ads • End cap display and TV • • Shopkick Digital program @ • Social engagement #This is my Multiple displays • Target.com recipes and Kroger twist • Digital display ads mobile app offer • Print magazine ad • Sig
Slide 13: Del Monte Philippines
Del Monte Philippines • Philippines sales in 3Q were up 12% in peso terms and 6% in US dollar terms, and in 9M +11% and +7%, respectively • Expanded penetration and increased consumption for juices, tomato-based sauces and packaged pineapple products • Continued promotion of pineapple juice health b
Slide 14: Del Monte Philippines (cont'd)
Del Monte Philippines (cont’d) Annual Christmas Packs in beautifully designed boxes perfect for gifting Del Monte Spaghetti Christmas Tree in Eastwood Mall In-store merchandising “This Christmas, make it completely delicious! choose the No. 1!” 14
Slide 15: Del Monte Philippines (cont'd)
Del Monte Philippines (cont’d) Seasonal flavours available in Del Monte Juice Drinks October-December: in-store sampling Pineapple Blueberry & (Christmas-themed) Pineapple Strawberry 15
Slide 16: S&W Asia and the Middle East
S&W Asia and the Middle East • S&W branded business sales in Asia and the Middle East were +35% in 3Q and +16% in 9M vs prior year period • Strong performance of both the fresh and packaged segments • China and Japan markets grew significantly on higher sales of canned tropical fruit and fresh fruit
Slide 17: S&W Asia and the Middle East (cont'd)
S&W Asia and the Middle East (cont’d) • Continued advertising in Israel of S&W 100% Pineapple Juices, Apple Juices and other canned juices via creative posts / shoutouts on Facebook • There is also a new launch for Pineapple & Coconut variant 17
Slide 18: S&W Asia and the Middle East (cont'd)
S&W Asia and the Middle East (cont’d) Chinese New Year Promotions (CNY) for 100% Pineapple Juice in Singapore Pineapple-led juices promotions conducted at Hyper supermarkets of NTUC Fairprice Objective: to promote healthy juice beverage choice over competitors that are mostly selling carbonated soft
Slide 19: FieldFresh India
FieldFresh India • DMPL’s share of loss in the FieldFresh joint venture in India for 3Q was down to US$0.3m from US$0.4m in the prior year period; and for 9M, share of loss was US$1.2m from US$1.6m • FieldFresh’s 3Q sales were +20% in rupee terms and +13% in US dollar terms, while for 9M +17% and +1
Slide 20: FieldFresh India (cont'd)
FieldFresh India (cont’d) Sweet Escapades Digital Campaign Increase Awareness of our Canned and Dried Fruit range amongst relevant consumers Drive usage by giving consumers more ways to use our products by sharing digitally simple but innovative recipes made using Del Monte packaged fruits range Del
Slide 21: Profit Outlook for FY2016
Profit Outlook for FY2016 • The Group will report a net profit for the full year of 2016, a significant turnaround from the net loss last year • In the short to mid term, DMFI is expected to improve profit performance through procurement synergies and transformation, optimisation of G&A costs • In t
Slide 22: Debt Outlook
Debt Outlook Planned issuance of perpetual preference shares • US$ perpetual preference shares • In the Philippines to be listed on the Philippine Stock Exchange • Launch in CY2016 subject to all regulatory approvals and market conditions • Up to US$360m • Will result in a further improvement of lev