Fresh Del Monte Produce, Inc. · NYSE:FDP
Fresh Del Monte Produce — Q2 2020 Earnings Presentation
45 slides from Fresh Del Monte Produce's earnings presentation, Jul 29, 2020
Slide 1: Providing Healthy Choices
Providing Healthy Choices Investor Relations Fresh Del Monte Produce Inc. July 29, 2020
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation contains certain forward-looking statements regarding the intent, beliefs or current expectations of the Company or its officers with respect to the Company’s plans and future performance. These forward-looking statements are based on information currentl
Slide 3: Key Differentiators
FRESH DEL MONTE PRODUCE Key Differentiators Demand for value-added produce is growing Positioned like no one else – vertically integrated & innovative Global player 5-Year strategic transformation capitalizes on our strengths 3
Slide 4: Decades of Growth
FRESH DEL MONTE PRODUCE AT A GLANCE Decades of Growth 1800’s 1900’s 2000’s 2010’s 1892 1989 2004 2013 2017 Acquired Acquired additional Announced new joint Del Monte® brand Fresh business separated Del Monte Foods production land in ventures with Del established from canned Europe’s full product Cos
Slide 5: Worldwide Business – Unmatched Global Network
Worldwide Business – Unmatched Global Network FRESH DEL MONTE PRODUCE AT A GLANCE We are one of the world’s leading 35,000 EMPLOYEES GLOBALLY vertically-integrated producers, 90+ Fresh distributors and marketers of fresh and & Value-Added COUNTRIES PRODUCTS fresh-cut fruit and vegetables as well as
Slide 6: Worldwide Business – Unmatched Global Network
Worldwide Business – Unmatched Global Network FRESH DEL MONTE PRODUCE AT A GLANCE 45% OF OUR FRESH PRODUCE WAS GROWN ON COMPANY-CONTROLLED FARMS 112k ACRES UNDER PRODUCTION 64k ACRES OWNED 48k ACRES LEASED 26% OF OWNED ACRES SET ASIDE TO PRESERVE BIODIVERSITY AND PROTECT WILDLIFE 6
Slide 7: Worldwide Business - Quality and Safety
FRESH DEL MONTE PRODUCE AT A GLANCE Worldwide Business - Quality and Safety To demonstrate compliance with international regulations and standards on environmental protection, food safety and social accountability, our farms and our facilities are certified by one or more of the following standards:
Slide 8: Worldwide Business – Broad Portfolio of Products
Worldwide Business – Broad Portfolio of Products FRESH DEL MONTE PRODUCE AT A GLANCE EUROPE CENTRAL AMERICA ASIA AFRICA Sales & Sourcing Sourcing Sales Sales ▪ Fresh & Fresh-cut fruit ▪ Bananas ▪ Fresh & fresh-cut ▪ Fresh fruit U.S. & CANADA and vegetables ▪ Pineapples fruit and ▪ Prepared food Sale
Slide 9: Broad Portfolio of Products - Leading Market Positions
Broad Portfolio of Products - Leading FRESH DEL MONTE PRODUCE AT A GLANCE Market Positions Largest marketer of fresh A leading marketer of fresh-cut fruit Third largest marketer of bananas in pineapples in the U.S., and a in the U.S, Canada, Japan, South the U.S., and a leading marketer of leading m
Slide 10: One of the Most Widely Recognized Food Brands Worldwide
One of the Most Widely Recognized FRESH DEL MONTE PRODUCE AT A GLANCE Food Brands Worldwide Symbol of quality and freshness Broad appeal ▪ Global opportunity to expand to new products and markets Health Wellness ▪ Better-for-you attributes 10
Slide 11: Market Leader & Pioneer in the Fresh Produce Industry
Market Leader & Pioneer in the Fresh FRESH DEL MONTE PRODUCE AT A GLANCE Produce Industry We were the… ✓ FIRST to complete a national U.S. distribution network ✓ FIRST to launch a national fresh-cut fruit network ✓ FIRST to introduce premium gold pineapple ✓ FIRST to achieve Global G.A.P. ✓ FIRST to
Slide 12: Sales & Product Platform
Sales & Product Platform FRESH DEL MONTE PRODUCE AT A GLANCE 2019 NET SALES: $4.5 BILLION Other Products & Services 3% Middle Tomatoes 1% Vegetables 4% Prepared East, 10% Food, 6% Melons, 2% Europe, Avocados, Other Fruit & 9% Vegetables, 14% 2% Non-Tropical Fruit, 4% BY BY Other, 1% REGION Fresh-Cut
Slide 13: Experienced and Results Oriented Management
Experienced and Results Oriented FRESH DEL MONTE PRODUCE AT A GLANCE Management Years at Name Title FDP Mohammad Abu-Ghazaleh Chairman and CEO 24 Youssef Zakharia President and COO 20 Eduardo Bezerra Senior Vice President and CFO 1 Marlene Gordon Senior Vice President – General Counsel and Secretary
Slide 14: A Diversified Company Positioned for Long-Term Growth
A Diversified Company Positioned for Long-Term Growth…
Slide 15: Capitalizing on Industry Dynamics
LOOKING INTO THE FUTURE Capitalizing on Industry Dynamics GLOBAL POPULATION 9,500 9,000 8,500 8,000 Millions 7,500 7,000 6,500 6,000 2013 2023 2033 2043 Source: The United Nations (2010) 15
Slide 16: Capitalizing on Industry Dynamics
LOOKING INTO THE FUTURE Capitalizing on Industry Dynamics FARM ACREAGE PER CAPITA 5.0 4.5 4.0 3.5 3.0 2.5 2.0 1.5 1.0 0.5 0.0 1900 1994 2050 Source: Food, Land, Population, and the US Economy – Cornell University / Instituto of Nazionale della Nutrizione (1994) 16
Slide 17: Capitalizing on Industry Dynamics
LOOKING INTO THE FUTURE Capitalizing on Industry Dynamics "Fruits and vegetables are expected to continue experiencing growth in niche areas as consumers persist in seeking out novel flavors from around the world. Increases in disposable personal income will support purchases of premium fruits and v
Slide 18: Capitalizing on Industry Dynamics
LOOKING INTO THE FUTURE Capitalizing on Industry Dynamics Value-Added Produce Booms in Popularity ”Consumers’ positive attitude towards health and wellness is translating into higher spends in value-added fruits and vegetables. Value-added category is exciting because it gives traditional commoditie
Slide 19: Strategy
Strategy
Slide 20: Our Vision
Our Vision Inspiring healthy lifestyles through wholesome and convenient products 20
Slide 21: Our Values
Our Values ▪ EXCELLENCE: We provide high quality level in all our products and services to fully achieve business results. ▪ PASSION: We have a passion to consistently deliver the best quality, fresh, fresh-cut fruit and vegetables and prepared produce in the industry. ▪ CREATIVITY: We foster innova
Slide 22: Unlocking the Value
Unlocking the Value STRATEGIC IMPERATIVES We have embarked on a 5-year plan to transform Fresh Del Monte Produce The key elements of our transformation involve: Protect and grow the core Drive innovation and expansion growth on value-added categories Become a technology driven company Become a consu
Slide 23: Focus on Strong - Execution, Fundamentals and Returns
Focus on Strong - Execution, UNLOCKING THE VALUE Fundamentals and Returns Protect and grow the core Drive innovation and expansion growth on value-added categories 23
Slide 24: The Del Monte Brand
Focus on Strong - Execution, UNLOCKING THE VALUE Fundamentals and Returns The Del Monte® Brand Food and Beverage Stores 24
Slide 25: Focus on Strong - Execution, Fundamentals and Returns
Focus on Strong - Execution, UNLOCKING THE VALUE Fundamentals and Returns Become a technology driven company Become a consumer driven company 25
Slide 26: Focus on Strong - Execution, Fundamentals and Returns
Focus on Strong - Execution, UNLOCKING THE VALUE Fundamentals and Returns Evolve our culture to increase employee engagement and productivity 26
Slide 27: Sustainability: Waste Less for a Better World Tomorrow
Sustainability: Waste Less for a Better UNLOCKING THE VALUE World Tomorrow 27
Slide 28: Sustainability: Waste Less for a Better World Tomorrow
Sustainability: Waste Less for a Better UNLOCKING THE VALUE World Tomorrow 28
Slide 29: Financial Review
Financial Review
Slide 30: Summary Data
Summary Data FINANCIAL PERFORMANCE Full Year 2nd Quarter 2015 2016 2017 2018 2019 2019 2020 Net Sales $ 4,057 $ 4,011 $ 4,086 $ 4,494 $ 4,489 $ 1,239 $ 1,092 Gross Profit $ 342 $ 461 $ 332 $ 280 $ 306 $ 98 $ 79 % Margin 8% 12% 8% 6% 7% 8% 7% Operating Income $ 91 $ 244 $ 153 $ 39 $ 114 $ 57 $ 33 Net
Slide 31: Fresh and Value-Added Products
Fresh and Value-Added Products FINANCIAL PERFORMANCE Full Year 2nd Quarter 2015 2016 2017 2018 2019 2019 2020 Net Sales* $ 2,043 $ 2,074 $ 2,184 $ 2,655 $ 2,710 $ 764 $ 636 Pineapples $ 525 $ 495 $ 493 $ 488 $ 455 $ 126 $ 114 Fresh-Cut Fruit $ 384 $ 418 $ 497 $ 507 $ 524 $ 146 $ 110 Fresh-Cut Vegeta
Slide 32: Bananas
Bananas FINANCIAL PERFORMANCE Full Year 2nd Quarter 2015 2016 2017 2018 2019 2019 2020 Net Sales $ 1,868 $ 1,812 $ 1,775 $ 1,703 $ 1,656 $ 440 $ 430 Gross Profit* $ 77 $ 159 $ 113 $ 84 $ 105 $ 38 $ 41 Gross Profit Margin 4% 9% 6% 5% 6% 9% 9% Figure in USD (millions) * Excludes asset impairment, rest
Slide 33: Earnings Per Diluted Share
Earnings Per Diluted Share FINANCIAL PERFORMANCE $4.74 $2.43 $2.43 $1.12 $0.72 $0.54 $0.40 2015 2016 2017 2018 2019 Q2 2019 Q2 2020 * Excludes asset impairment, restructuring charges & gain/(loss) on the sale of assets. 33
Slide 34: Adjusted EBITDA
Adjusted EBITDA FINANCIAL PERFORMANCE $340 $219 $233 $209 $161 $73 $62 2015 2016 2017 2018 2019 Q2 2019 Q2 2020 Figure in USD (millions) * Excludes asset impairment, restructuring charges & gain/(loss) on the sale of assets. 34
Slide 35: Operating Cash Flow
Operating Cash Flow FINANCIAL PERFORMANCE $332 $247 $231 $194 $169 $111 $65 2015 2016 2017 2018 2019 Q2 2019 Q2 2020 Figure in USD (millions) 35
Slide 36: Debt & Capital Expenditures / Investing in Diversification & Expansion Capital
Debt & Capital Expenditures / Investing FINANCIAL PERFORMANCE in Diversification & Expansion Capital Expenditures $151 Debt $662 $147 $139 $132 $587 $122 $358 $254 $232 2015 2016 2017 2018 2019 2015 2016 2017 2018 2019 Total Debt ▪End of the first six months of 2020 Repurchase Program Dividend Polic
Slide 37: Fresh Del Monte Produce Investment Highlights
Fresh Del Monte Produce Investment Highlights Clear Growth DEL MONTE Strategy Brand Vertically- Market Leader Integrated in Diverse and Global Produce Operations Categories Distribution and Fresh-Cut Centers (Value-Added Focus) 37
Slide 38: Appendix
Appendix
Slide 39: Income Statement
Income Statement APPENDIX Full Year 2nd Quarter 2015 2016 2017 2018 2019 2019 2020 Net Sales $ 4,057 $ 4,011 $ 4,086 $ 4,494 $ 4,489 $ 1,239 $ 1,092 Cost of Sales 3,714 3,550 3,754 4,214 4,177 1,141 1,003 Restructuring and Other Charges - - 1 - 5 1 11 Gross Profit 342 461 332 280 306 98 79 % Margin
Slide 40: Non-GAAP Measures
Non-GAAP Measures APPENDIX The Company's results are determined in accordance with U.S. generally accepted accounting principles (GAAP). Some of the information presented in this press release reflects adjustments to GAAP measures such as amounts related to restructuring, asset impairment and other
Slide 41: Income Statement
Income Statement APPENDIX Quarter ended Six months ended June 26, June 28, June 26, June 28, 2020 2019 2020 2019 Non-GAAP Measures (per share)(1): Reported net income - Diluted $ 0.38 $ 0.78 $ 0.64 $ 1.53 Other product-related charges 0.22 0.01 0.39 0.01 Asset impairment and other charges (credits),
Slide 42: Income Statement
Income Statement APPENDIX Quarter ended Quarter ended June 26, June 28, 2020 2019 Net income Net income Net income attributable to Net income attributable to attributable to Fresh Del Monte attributable to Fresh Del Monte Operating Fresh Del Monte Produce Inc. per Operating Fresh Del Monte Produce I
Slide 43: Income Statement
Income Statement APPENDIX Six months ended Six Months ended June 26, June 28, 2020 2019 Net income Net income Net income attributable to Net income attributable to attributable to Fresh Del Monte attributable to Fresh Del Monte Operating Fresh Del Monte Produce Inc. per Operating Fresh Del Monte Pro
Slide 44: Balance Sheet
Balance Sheet APPENDIX Full Year SixMonths 2015 2016 2017 2018 2019 2019 2020 ASSETS Cash & Short Term Investments $ 25 $ 20 $ 25 $ 21 $ 33 $ 16 $ 32 Accounts Receivable 417 412 432 $ 474 $ 439 496 445 Inventory & Other 544 529 562 644 579 582 527 CURRENT ASSETS 986 961 1,020 1,139 1,051 1,095 1,004
Slide 45: Cash Flow
Cash Flow APPENDIX Full Year Six Months 2015 2016 2017 2018 2019 2019 2020 Net Income* $ 66 $ 226 $ 119 $ (16) $ 69 $ 76 $ 31 Non-Cash Charges 150 93 104 $ 150 $ 110 56 49 Working Capital 14 13 (29) 113 (10) (67) 31 Operating Cash Flow 231 332 194 247 169 65 111 Capital Expenditures (132) (147) (139
Fresh Del Monte Produce — Q2 2020 Earnings Presentation on 6ix