Hormel Foods Corporation · NYSE:HRL
Hormel Foods — BMO Capital Markets 11th Annual Farm to Market Conference 2016
28 slides from Hormel Foods's conference presentation, May 18, 2016
Slide 1: Jim Snee, President and Chief Operating Officer
Jim Snee President and Chief Operating Officer 1
Slide 2: Legal Disclosure
Legal Disclosure This presentation contains forward-looking information based on management’s current views and assumptions. Actual events may differ materially. Please refer to the cautionary statement regarding Forward-Looking Statements and Risk Factors on pages 30-35 in the Company’s Form 10-Q f
Slide 3: 2016 Second Quarter Results
2016 Second Quarter Results Revenue Earnings per share In millions 2015 Q2 $2,279 2015 Q2 $0.33 2016 Q2 $2,300 2016 Q2 $0.40 + 1% + 21% • Record sales and earnings for the quarter • Four of five segments delivered operating profit growth 3
Slide 4: 2016 Second Quarter Segment Results
2016 Second Quarter Segment Results Net Sales Segment Profit Change Change Grocery Products + 1% + 21% Refrigerated Foods + 7% + 13% Jennie-O Turkey Store - 4% + 20% Specialty Foods - 5% + 74% International & Other - 17% - 33% 4
Slide 5: 2016 Outlook
2016 Outlook Grocery Products and Jennie-O EPS Refrigerated Foods Turkey Store + 18% to 21% Value-added growth Recovery from Avian Influenza Favorable input costs $1.56 to $1.32* $1.60 Specialty Foods International Contribution Improved from CytoSport export demand Updated margin guidance 11%-14% 20
Slide 6: Growth Amidst Volatility
Growth Amidst Volatility $2.00 Hormel Foods EPS Avian Influenza $1.56 to $1.60 $1.50 PEDv Higher Input High Costs Grain Costs Recession $1.00 Stock Market Woes $0.50 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 6
Slide 7: A Formula For Success
A Formula For Success Building Innovation Acquisitions Balanced brands Portfolio + + + 7
Slide 8: Positioning Our Portfolio for Future Growth
Positioning Our Portfolio for Future Growth Global Multicultural Healthy / Holistic On-the-Go 8
Slide 9: Strong Branded Portfolio
2 ae eee Strong Branded Portfolio APPLEGATE. GUACAMOLE. ey Lo a MILK @ me NATURAL CHOICE’
Slide 10: Our Brand Leadership…
Our Brand Leadership… Healthy/ Holistic Total Awareness Jennie-O® Brand 2015 2009
Slide 11: … Is Driving Future Growth
… Is Driving Future Growth Healthy/ Holistic Jennie-O ® Lean Ground Turkey Tray Ranks #2 Among All Turkey’s Share of Ground Meats Exact Weight Items in the Meat Department Nationally* 11.8% 12.6% 10.6% 9.3% 8.7% 8.3% 7.4% 2010 2011 2012 2013 2014 2015 Source: IRI FreshLook 11
Slide 12: Fueling Brand Strength
Fueling Brand Strength (Advertising Expense) +27% +27% 2013 2014 2015 12
Slide 13: Brand Investments
Geil Brand Investments Y pone MUSCLE >) MILK” VV a ;
Slide 14: Leveraging the Iconic SKIPPY Brand
Leveraging the Iconic SKIPPY® Brand Global Healthy/ Holistic On-the-Go 14
Slide 15: Ie=e
Ie=e WEOLly | HERDEZ| GUACAMOLE. PECANWOOD THICK CUT BACON 15
Slide 16: Innovative Foodservice Solutions
Innovative Foodservice Solutions 16
Slide 17: Innovative Go-To-Market Strategy
Innovative Go-To-Market Strategy 17
Slide 18: Growth Through Acquisitions
Growth Through Acquisitions Global Multi-Cultural Healthy/ Holistic On-the-Go 18
Slide 19: Healthy/ Holistic On-the-Go
Healthy/ Holistic On-the-Go 19
Slide 20: An Excellent Strategic Fit
An Excellent Strategic Fit Healthy/ Holistic On-the-Go Source: IRI Custom DB MULO 52 Wk End 12/27/2015 20
Slide 21: Global Healthy/ Holistic On-the-Go
Global Healthy/ Holistic On-the-Go 21
Slide 22: Portfolio Alignment with Consumers
Portfolio Alignment with Consumers Millennials Gen X Boomers Matures Source: IRI Custom DB MULO 52 Wk End 12/27/2015 22
Slide 23: Our Balanced Model
Our Balanced Model Protein Packaged Foods Pork and Turkey Nuts, Avocados, Tomatoes Retail Foodservice Financially Innovative Conservative Culture Grocery Refrigerated Jennie-O Specialty International Products Foods Turkey Store Foods 23
Slide 24: A Formula For Success
A Formula For Success Building Innovation Acquisitions Balanced brands Portfolio + + + 24
Slide 25: … Equals Impressive Growth…
… Equals Impressive Growth… = & & * * *5-year CAGR based on FY 2010-2015 25
Slide 26: That Drives Shareholder Return
$50 $100 $150 $250 $300 $350 $400 $450 $200 $0 $100 $150 $250 $300 $350 $400 $450 $200 $50 01/03/11 02/03/11 03/03/11 04/03/11 05/03/11 06/03/11 07/03/11 2011 08/03/11 09/03/11 10/03/11 11/03/11 12/03/11 01/03/12 02/03/12 03/03/12 04/03/12 05/03/12 06/03/12 07/03/12 08/03/12 2012 09/03/12 10/03/12 1
Slide 27: Farm to Market Conference
CHOCOLAT; NON DAIRY ’ PROTEIN SHAKE. = Farm to Market Conference 18-19, 2016 | Ne 27
Slide 28: Adjusted Financial Measures
Adjusted Financial Measures Adjusted segment operating profit, net earnings, and diluted net earnings per share exclude charges relating to the closure of the Stockton, California, manufacturing facility and the exit from international joint venture businesses in the first quarter, and charges relat
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