Lassonde Industries, Inc. Class A · TSX:LAS.A
Lassonde Industries, Inc. Class A — Shareholder Meeting (May 2018)
34 slides from Lassonde Industries, Inc. Class A's shareholder meeting presentation, May 11, 2018
Slide 1: Annual General Meeting: Financial Results for Fiscal 2017 and First Quarter 2018
LASSONDE INDUSTRIES INC. ANNUAL GENERAL MEETING Financial Results for Fiscal 2017 and First Quarter 2018 May 11, 2018
Slide 2: Forward-Looking Statements
FORWARD-LOOKING STATEMENTS Caution regarding forward-looking statements Certain statements made in this presentation, including, but not limited to, statements regarding the prospects of the industry, plans, financial position, and business strategy of the Company may constitute forward-looking stat
Slide 3: Highlights – Fiscal 2017: Earnings
HIGHLIGHTS–FISCAL 2017 Earnings In millions of $ Years ended (except EPS) %Δ December 31 %Δ 2017 2016 2015 17 vs 16 16 vs 15 Sales 1,526.1 1,509.5 1,449.3 1.1% 4.2% Operating profit 133.3 126.2 111.3 5.6% 13.4% Operating profit/Sales 8.7% 8.4% 7.7% Profit 95.5 72.2 60.2 32.4% 19.8% Profit attributab
Slide 4: Highlights – Fiscal 2017: Earnings (cont'd)
HIGHLIGHTS–FISCAL 2017 Earnings (cont’d) Sales of $1,526.1M, $16.6M (or 1.1%) vs $1,509.5M in 2016 : • Unfavourable foreign exchange impact of $19.6M; • Excluding the foreign exchange impact, sales are up 2.4%; • $60.0M increase in sales of private label products; • $22.4M decrease in the sales vo
Slide 5: Highlights – Fiscal 2017: Earnings (cont'd)
HIGHLIGHTS–FISCAL 2017 Earnings (cont’d) Financial expenses of $12.2M in 2017 vs $21.0M in 2016, by $8.8M: • A $5.5M decrease in interest expense mainly on the U.S. credit facilities; and • A $2.5M decrease in amortization of transaction costs due, among others, to a $1.3M write-off of capitalized
Slide 6: Highlights – Fiscal 2017: Statements of Financial Position
HIGHLIGHTS–FISCAL 2017 Consolidated Statements of Financial Position In millions of $ As at December 31 %Δ %Δ 2017 2016 2015 17 vs 16 16 vs 15 Non-cash working capital 145.0 169.5 190.6 -14.5% -11.1% Property, plant and equipment 273.3 268.8 271.3 1.7% -0.9% Total assets 1,055.7 1,103.6 1,143.8 -4.3
Slide 7: Highlights – Fiscal 2017: Free Cash Flow Analysis
HIGHLIGHTS–FISCAL 2017 Free Cash Flow Analysis In m illions of $ Years ended December 31 Variance 2017 2016 2017-2016 Free cash flow Profit 95.5 72.2 23.3 Adjustments Amortization and Depreciation 45.2 44.6 0.6 Pension plans, income tax and other (0.9) 7.6 (8.5) Change in non-cash working capital 5.
Slide 8: Highlights – First Quarter 2018: Earnings
HIGHLIGHTS–FIRST QUARTER 2018 Earnings In millions of $ (except EPS) First Quarters ended March 31 April 1 %Δ $Δ 2018 2017 18 vs 17 18 vs 17 Sales 357.7 370.7 -3.5% (13.0) Operating profit 22.3 23.7 -5.6% (1.4) Operating profit/Sales 6.2% 6.4% Profit attributable to shareholders 14.5 13.1 11.2% 1.4
Slide 9: Highlights – First Quarter 2018: Earnings
HIGHLIGHTS–FIRST QUARTER 2018 Earnings Sales of $357.7M, $13.0M from $370.7M in 2017: • Excluding a $9.8M unfavourable foreign exchange impact, sales decreased by $3.2M (0.9%), mainly due to: • An unfavourable price impact in the United States; and • A decrease in the sales volume of national bran
Slide 10: Highlights – First Quarter 2018: Earnings (cont'd)
HIGHLIGHTS–FIRST QUARTER 2018 Earnings (cont’d) Financial expenses of $2.2M vs $3.3M in 2017, $1.1M: • A $0.8M decrease in long-term debt interest expenses mainly arising from a reduction in indebtedness; • A $0.2M decrease in the amortization of transaction costs. “Other (gains) losses”: Less tha
Slide 11: Dividends and Outlook
DIVIDENDS AND OUTLOOK Fiscal 2018 Dividend: • Quarterly dividend of $0.81 per share (payable on June 15 for Q1); • Up 32.8% from 2017; • On an annualized basis, represents approximately 25% of 2017 profit attrib. to shareholders; • It should be noted, however, that the 2017 profit attributable to sh
Slide 12: Dividends and Outlook (cont'd)
DIVIDENDS AND OUTLOOK (CONT’D) Fiscal 2018 (excluding the impact of OOB acquisition) Outlook: • The Company’s sales were down 3.5% in the first quarter of 2018 when compared to the first quarter of 2017. Excluding foreign exchange impacts, the adjusted decrease was 0.9%. Barring any significant exte
Slide 13: Part of the family since 1918
LASSONDE INDUSTRIES INC. Part of the family since 1918 13
Slide 14: Part of the Family Since 1918
PART OF THE FAMILY SINCE 1918 14
Slide 15: The Approach of a Founder
THE APPROACH OF A FOUNDER Aristide Lassonde and Georgianna Darcy First factory in Rougemont 15
Slide 16: The Approach of a Founder
THE APPROACH OF A FOUNDER 16
Slide 17: Lassonde Industries Inc. Overview
LASSONDE INDUSTRIES INC. Overview Cash flows from 2017 Sales: operating activities: $1,526.1 M $144.9 M Lassonde Industries Inc. develops, manufactures, and markets distinctive food products. Lassonde Pappas A. Lassonde Lassonde Specialties Arista Wines and Company The Canadian Develops, Imports and
Slide 18: Geographic Sales Distribution
LASSONDE INDUSTRIES INC. Geographic sales distribution In millions $1,800 Canada United States Other $1,600 $1,400 $1,200 59% $1,000 $800 $600 6% $400 41% 92% $200 $0 2010 2011 2012 2013 2014 2015 2016 2017 N.B.: If the acquisition of OOB had occurred on January 1, 2017, sales in the U.S. would have
Slide 19: Corporate Strategy: Mission and Vision
CORPORATE STRATEGY Mission Vision Serve North •Be a North American leader at developing, American families manufacturing, and marketing an innovative, distinctive line of foods and beverages that contain with food and healthy ingredients. beverages that are both delicious •Be an employer of choice t
Slide 20: Corporate Strategy
CORPORATE STRATEGY TO OFFER THE RIGHT PRODUCT IN THE RIGHT SIZE AT THE RIGHT PRICE INNOVATE - Healthy Products - Hydration TO CONSOLIDATE TO PROMOTE SUSTAINABLE DEVELOPMENT 20
Slide 21: Old Orchard Brands: The Transaction
OLD ORCHARD BRANDS The Transaction • Total consideration of US$146.0 million, payable upon closing of the transaction, subject to working capital and other adjustments; • Acquisition of the plant and land for US$4.0 million subject to satisfaction of certain regulatory conditions; • By way of additi
Slide 22: Old Orchard Brands: Products
OLD ORCHARD BRANDS Products Frozen 22
Slide 23: Old Orchard Brands: History
OLD ORCHARD BRANDS History 1980s 1990s 2000s 2010s 2017 •Brand •Initial launch •Shelf-Stable •Investment to •SQF Level III •Continued innovation and new launched in of Shelf- expanded to increase shelf- certification product launches: 1970s Stable Juice include 100% stable capacity attained Cocktail
Slide 24: Old Orchard Brands: Markets
OLD ORCHARD BRANDS Markets Shelf-stable First or second positions in many key Midwest and South Central U.S. markets Source: Brand rankings per Nielsen L-52 weeks Total U.S. Food channel as of July 29, 2017; Shelf-stale Juices and Drinks (59-64oz). 24
Slide 25: Old Orchard Brands: Products
OLD ORCHARD BRANDS Products Shelf-Stable Frozen 2017 Sales 100% Healthy Juice Frozen 100% 100% Juice Blends Balance Cocktails US$103.3 million Juice Blends 2017 Adjusted EBITDA Harvest Select Seasonal Ades Organics Seasonal Kids US$15.8 million Frozen Mixers 100% Juice Cranberry Cocktails 25
Slide 26: Old Orchard Brands: An American Leader
OLD ORCHARD BRANDS An American Leader •Over 35-year brand heritage •Strong, highly experienced & cohesive senior management team •Broad and consumer-relevant product offering •Leading, independent player in shelf-stable and frozen •Solid relationship with key national and regional accounts •Best-in-
Slide 27: Lassonde Today
LASSONDE TODAY Following acquisition of Old Orchard Brands 1. Calgary (AB) 2. Thornbury (ON) 3. Toronto (ON) 4. Rougemont, Saint-Damase, 1 Boisbriand (QC) head office and multiple facilities 5 5. Port Williams (NS) 4 2 14 3 6 13 6. Carver (MA) cranberry receiving station 8 7 9 7. Seabrook (NJ) 8. Ca
Slide 28: Follow-up on 2017 Priorities
FOLLOW-UP ON 2017 PRIORITIES Refine our long-term action plan to protect the profitability of our Canadian operations in a context of a persistently Increase of $9.3M in Canadian EBIT low Canadian dollar relative to the U.S. dollar; Maintain our organic growth through innovation and by 2.4% growth i
Slide 29: 2018 Priorities
2018 PRIORITIES • Finalize the Old Orchard Brands acquisition and start the integration process. • Raise the production capacity of Lassonde Specialties to meet the needs of the strong growth of this subsidiary. A three-year, approximately $23M investment program will begin in 2018. • Reap the rewar
Slide 30: Financial Performance
LASSONDE INDUSTRIES INC. Financial Performance 30
Slide 31: Selected Financial Information
SELECTED FINANCIAL INFORMATION 5 years Sales (in millions of $) EBITDA (in millions of $) *CAGR 5 years: 8.3 % *CAGR 5 years: 8.9 % 1,800.0 200.0 177.9 1,600.0 1,509.5 1,526.1 180.0 171.2 1,449.3 160.0 154 1,400.0 1,181.0 140.0 1,200.0 123.2 1,040.2 115.7 120.0 1,000.0 100.0 800.0 80.0 600.0 60.0 40
Slide 32: Selected Financial Information (cont'd)
SELECTED FINANCIAL INFORMATION 5 years (cont’d) EBIT (in millions of $) EPS (in $) *CAGR 5 years: 9.2 % *CAGR 5 years: 15.3 % 160.0 14.0 12.87 140.0 133.3 126.2 12.0 120.0 111.3 9.75 10.0 100.0 8.15 88.4 83.1 8.0 80.0 6.43 6.47 6.0 60.0 4.0 40.0 2.0 20.0 0.0 0.0 2013 2014 2015 2016 2017 2013 2014 20
Slide 33: Stock Price
STOCK PRICE As at March 31, 2018 Book Value $86.39 As at May 9, 2018 Share value $266.51 Market Capitalization $1,862.4 M The stock price increased from $89.00 as at May 9, 2013 to $266.51 as at May 9, 2018 for a total return of 199% (CAGR – 5 years: 24.5%). DIVIDENDS PER SHARE – 5 YEARS 2013 2014 2
Slide 34: Annual General Meeting: Financial Results for Fiscal 2017 and First Quarter 2018
LASSONDE INDUSTRIES INC. ANNUAL GENERAL MEETING Financial Results for Fiscal 2017 and First Quarter 2018 May 11 2018