Hostess Brands — Q2 2022 Earnings Presentation
21 slides from Hostess Brands's earnings presentation, Aug 3, 2022
Slide 1: Investor Presentation
Investor Presentation AUGUST 3, 2022
Slide 2: Disclaimer
Disclaimer Forward Looking Statements This investor presentation contains statements reflecting our views about the future performance of Hostess Brands, Inc. and its subsidiaries (referred to as “Hostess Brands” or the “Company”) that constitute “forward-looking statements” that involve substantial
Slide 3: Key Takeaways
Key Takeaways Strong topline momentum with 16.8% organic net revenue growth during the quarter reflecting higher price/mix and volumes 15.6% Hostess Brands’ point-of-sale growth in Sweet Baked Goods and 25.0% Voortman® branded growth in Cookies* Executed previously announced pricing actions to
Slide 4: 10th Consecutive Quarter of 9+% Net Revenue Growth
10th Consecutive Quarter of 9+% Net Revenue Growth Double-digit growth in each of the last 5 quarters Quarterly Adjusted Net Revenue Growth 25.1% 18.1% 16.1% 16.8% 14.8% 10.8% 10.4% 9.3% 9.1% 9.0% Q1 '20 Q2 '20 Q3' 20 Q4 '20 Q1 '21 Q2 '21 Q3 '21 Q4 '21 Q1 '22 Q2 '22 Adjusted Net Revenue is a non-GAA
Slide 5: 16.8% Net Revenue Growth in Challenging Environment
16.8% Net Revenue Growth in Challenging Environment Continued EBITDA growth demonstrates resilience Net Adjusted Adjusted Revenue EBITDA EPS (in millions) (in millions) $340.5 $68.4 $68.9 $0.23 $0.22 $291.5 Q2 2021 Q2 2022 Q2 2021 Q2 2022 Q2 2021 Q2 2022 Adjusted EBITDA and Adjusted EPS are non-GAAP
Slide 6: Revenue Growth Driven by Hostess and Voortman
Revenue Growth Driven by Hostess® and Voortman® 15+% organic growth across our portfolio of sweet baked goods and cookies Three Months Ended Six Months Ended June 30, Change June 30, Change ($ in millions) 2022 2021 $ % 2022 2021 $ % Sweet Baked Goods $303.5 $262.5 $41.0 15.6% $599.8 $500.2 $99.6 19
Slide 7: Both Price/Mix and Volume Driving Revenue Growth
Both Price/Mix and Volume Driving Revenue Growth Continued volume growth despite incremental pricing driven by solid consumer demand 16.8% Organic Net Revenue Growth $340.5 million 13.8% 3.0% Growth $291.5 Growth million Net Net Revenue Revenue * Primarily to offset higher inflation 7
Slide 8: Continued POS Dollar Growth Across Portfolio
Continued POS Dollar Growth Across Portfolio Outstanding execution drives point-of-sale growth in the Sweet Baked Goods and Cookie categories Point-of-Sale Growth (in millions) $46 $37 25.0% growth Cookies 19.5% 19.9% Sweet 15.6% $456 growth Baked $394 Goods Q2 2021 Q2 2022 Source: Nielsen, Total Ni
Slide 9: 15+% Single-Serve and Multi-Pack POS Growth in Q2
15+% Single-Serve and Multi-Pack POS Growth in Q2 Uniquely positioned to drive both at-home and immediate consumption occasions Single-Serve Point-of-Sale Q2 2021 19.8% Single-serve 2 year stacked growth Q2 2022 16.1% 35.9% Multi-Pack Point-of-Sale Q2 2021 5.4% Multi-pack 2 year stacked growth Q2 20
Slide 10: Holding Market Share in Volatile Market Environment
Holding Market Share in Volatile Market Environment Market Share (13 weeks) POS $ up 15.6% & Units up 2.8%, 21.8% 21.7% Growing Unit Share of SBG Category by +70bps! Breakfast POS up 22.1%, Growing Market Share of Sub- category by +100bps! Q2 ‘21 Q2 ‘22 Source: Nielsen, Total Nielsen Universe for th
Slide 11: Consistent Track Record of Market Share Gains
Consistent Track Record of Market Share Gains Outstanding execution drives POS growth and expanding market share in Sweet Baked Goods category Point-of-Sale Market Share (52 weeks, in millions) (52 Weeks) $1,702 21.7% $1,425 $1,318 20.4% $1,226 19.5% $1,168 19.1% 18.4% 2018 2019 2020 2021 2022 2018
Slide 12: Consolidated Financial Results
Consolidated Financial Results Delivering double-digit net revenue growth for the quarter and year-to-date Three Months Ended Six Months Ended June 30, Change June 30, Change ($ in millions, except per 2022 2021 $ % 2022 2021 $ % share data) Net Revenue $340.5 $291.5 $49.0 16.8% $672.5 $556.9 $115.6
Slide 13: Raising Full-Year 2022 Revenue Guidance
Raising Full-Year 2022 Revenue Guidance Updated Guidance Previous Guidance ($ in millions, except EPS) Net Revenue Growth At least 15% At least 12% Towards the higher end of Towards the higher end of Adjusted EBITDA $280 – $290 $280 – $290 Adjusted EPS $0.93 - $0.98* $0.93 - $0.98* $120 – $140 $120
Slide 14: Strong Innovation in Targeted Consumer Occasions
Strong Innovation in Targeted Consumer Occasions Bouncers Innovation Continued great momentum of recent Launching in 2H 2022 with strong innovation across retailer reception morning sweet start and Targeted at the fast-growing afternoon sharing lunchbox occasion occasions 14
Slide 15: Brand Activation is Helping Fuel Consumer Interest
Brand Activation is Helping Fuel Consumer Interest Increasing top-of-mind awareness and consideration Driving Social Engagement Continuing High ROI Over 1.6 Billion Earned Impressions in Q2 Marketing Investments Building Impactful E-Commerce Presence With new content and consumer product reviews acr
Slide 16: Executing on Key Capital Allocation Priorities
Executing on Key Capital Allocation Priorities Flexibility to invest in growth and generate shareholder value 1 Support Core Growth Capex of $41.9M YTD ‘22, including investment in new bakery to support continued growth 2 4.0x** Growth-oriented branded targets, that expand our Targeted M&A 3.3x capa
Slide 17: Catapulting Into the Next Phase of Organic Growth
Catapulting Into the Next Phase of Organic Growth Key enablers of our differentiated growth 1 2 3 Our Our Our business sits in BUSINESS INNOVATION GROWING MODEL & MARKETING SPACES is best-in-class are gaining momentum Learn more about our long-term growth story outlined at our recent Investor Day us
Slide 18: Attractive Long-Term Growth Algorithm
Attractive Long-Term Growth Algorithm Recent Investor Day unveiled a leading sales and profit growth algorithm Mid-Single Digit 5-7% 7-9% Organic EBITDA EPS Revenue Growth Growth Growth Long-term Growth Algorithm to Deliver Top-Tier Shareholder Returns See "Forward Looking Statements." EBITDA is a n
Slide 19: Appendix
Appendix
Slide 20: Non-GAAP Reconciliations
Non-GAAP Reconciliations Three Months Ended June 30, 2022 Three Months Ended June 30, 2021 Gross Gross Operating Net Net Income Diluted Gross Gross Operating Net Net Income Diluted Profit Margin Income Income Margin EPS Profit Margin Income Income Margin EPS GAAP results $ 112.7 33.1% $ 51.0 $ 30.5
Slide 21: Non-GAAP Reconciliations
Non-GAAP Reconciliations 1. Project consulting costs are included in general and administrative on the condensed consolidated statement of operations. 2. In 2022, costs related to certain corporate initiatives, which includes $0.1 million of accelerated depreciation. In 2021, costs related to certai