Del Monte Pacific Limited · SGX:D03
Del Monte Pacific — Q1 FY2017 Earnings Presentation
29 slides from Del Monte Pacific's earnings presentation, Sep 9, 2016
Slide 1: Del Monte Pacific 1Q FY2017 Results
Del Monte Pacific 1Q FY2017 Results 9 September 2016
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 Summary 1Q FY2017 Results Market Updates Sustainability Awards Outlook 3
Slide 4: Notes to the 1Q FY2017 Results
Notes to the 1Q FY2017 Results 1. First quarter is 1 May to 31 July. 2. DMPL’s stake in DMFI is 89.4%, hence the non controlling interest line (NCI) in the P&L. 3. Net income is net of NCI. 4. DMPL changed measurement of the cost of inventory from weighted average to FIFO method in April 2016 and th
Slide 5: 1Q FY2017 Results and Outlook
1Q FY2017 Results EBITDA of US$23.7m was 20% higher US subsidiary slightly lower sales driven by non-branded business but increased market share across major branded categories Del Monte Philippines and S&W continued to deliver strong performance Deleveraging planned with Preference Shares o
Slide 6: DMPL 1Q FY2017 Group Results Summary
DMPL 1Q FY2017 Group Results Summary Sales of US$466m down by 3%, driven by non-branded US sales Sales % Change US -6 Philippines +9 (in peso terms +14) S&W +12 OEM Exports -4 FieldFresh India (equity accounted) +8 (in Rupee terms +14) All figures below without one-off expenses, and vs prior year
Slide 7: Del Monte Foods USA's Seasonality
Del Monte Foods USA’s Seasonality DMFI’s sales have seasonality, with 1Q as the weakest quarter 1Q : 19-21% of FY (Back to school) 2Q : 29-31% of FY (Pipelining for Thanksgiving) 3Q : 26-28% of FY (Christmas) 4Q : 22-24% of FY (Easter) Lower sales also reflect on profit performance where DMFI hi
Slide 8: One-off Expenses
One-off Expenses In US$ m 1Q FY17 1Q FY16 Booked under Closure of North Carolina plant 1.5 - CGS ERP implementation at DMFI - 2.0 G&A expense Sager Creek integration - 0.8 G&A expense Severance 3.4 0.3 G&A expense Total (pre-tax basis) 4.9 3.1 Total (net of tax and minority 2.8 1.7 interest) 8
Slide 9: DMPL 1Q FY2017 Results – As reported
DMPL 1Q FY2017 Results – As reported 1Q 1Q In US$m Chg (%) Comments FY 2016 FY 2017 Lower DMFI non-branded sales partly offset by Turnover 478.7 465.5 -2.8 higher Philippines and S&W Asia sales Normalised trade spend at DMFI coming off a low Gross profit 102.5 93.6 -8.7 base last year due to product
Slide 10: 1Q FY2017 Turnover Analysis
1Q FY2017 Turnover Analysis Americas 75% 24% Asia Pacific 1% Europe Americas -6.3% Continued impact of unsuccessful low-margin US Department of Agriculture bids from the second half of FY2016 plus reduced sales in private label and foodservice business lines. However, volume of branded retail was
Slide 11: United States of America
United States of America Market Share (#1) Market Share (#1) Market Share (#2) Packaged Core Vegetable Packaged Core Fruit Packaged Cut Tomato Slowly declining canned category: Win through innovation, differentiation and product attributes DMFI had higher market shares in packaged vegetables and
Slide 12: Del Monte Foods USA
Del Monte Foods USA DMFI’s 1Q sales down 6.1% to US$351m • Continued impact of unsuccessful low-margin US Department of Agriculture bids from the 2H of FY2016 plus reduced sales in private label and foodservice business • Del Monte canned vegetable and College Inn broth performed well with volume
Slide 13: Del Monte Foods New Product
Del Monte Fruit Refreshers Del Monte Foods New Product A modern twist on the Fruit Cup… Pineapple in Passionfruit Fruit Water Mandarin Orange in Coconut Water Grapefruit & Oranges in Pomegranate Fruit Water Grapefruit in Pink Guava Fruit Water Brings a number of firsts to the category… new, on tre
Slide 14: DELMONTE.COM/SOCIAL
DELMONTE.COM/SOCIAL Promoting newly launched Fruit Refreshers 14 14
Slide 15: PR & Social Media Support
PR & SOCIAL MEDIA SUPPORT Spokesperson Content Avon 39 Walk Influencer Blog & & NYC Media Event Sampling & Tent Social Content San Francisco July 23-24 New York City New York City July 28 Oct 15-16 15
Slide 16: Shopper Marketing
SHOPPER MARKETING Retailer specific programs Fruit Refreshers Shipper Walmart End Yieldbot digital link to Target Cap TV & Smart Cartwheel Refreshers offer Network 1,600+ stores 2 additional screens July 18-August 1 16
Slide 17: Philippines
Philippines Market Share (#1) Market Share (#1) Market Share (#1) Canned Pineapple Canned Mixed Fruit Canned and Tetra RTD Juices Market Share (#1) Market Share (#1) Tomato Sauce Spaghetti Sauce Del Monte is the market leader across several categories Modern trade and convenience stores are grow
Slide 18: Del Monte Philippines
Del Monte Philippines Philippines sales in 1Q were up 14% in peso terms and 9% in US dollar terms Expanded penetration and increased consumption of packaged pineapple, culinary and beverage categories New advertising campaigns Foodservice channel continued to outperform the market, growing b
Slide 19: Del Monte Philippines New Product
Del Monte Philippines New Product Launched Del Monte Creamy & Cheesy Spaghetti Sauce in May 2016 Provides a relevant and distinct superiority platform for Del Monte Spaghetti Sauce vis- à-vis low-priced brands 19
Slide 20: Del Monte Philippines Beverage
Del Monte Philippines Beverage Del Monte Beverages hit the ground running in FY2017 with two new campaigns Fit ‘n Right encouraged young adults to take control of their weight with a proactive lifestyle and a bottle of Fit ‘n Right everyday Del Monte Juice Drinks moved to gain a bigger share of
Slide 21: Del Monte Philippines Beverage – cont'd
Del Monte Philippines Beverage – cont’d Del Monte Heart Smart is an innovative 100% juice that aids in cholesterol reduction Expanded its relevance amongst adults, 30’s and up with an endorsement from the Philippine Association of Thoracic and Cardiovascular Surgeons 21
Slide 22: Asia and Middle East
Asia and Middle East Consumers moving towards less processed and more natural food: S&W expanding sales of S&W Sweet 16 fresh pineapple E-commerce and digital are growing with North Asia having the largest share of e-commerce pie: S&W is actively exploring this channel Short supply of packaged
Slide 23: 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 up 12% in 1Q Strong sales of canned fruit in North Asia on the back of improved distribution In China, S&W tied up with Burger King to supply pineapple slices for its burgers In the fresh segment, S&W pa
Slide 24: S&W Asia and the Middle East – cont'd
S&W Asia and the Middle East – cont’d Stronger growth of S&W Fresh Pineapple in China with the co- branding program with Goodfarmer, one of China’s leading suppliers of fruits and vegetables 24
Slide 25: FieldFresh India
FieldFresh India DMPL’s share of loss in the FieldFresh joint venture in India for 1Q was down to US$0.3m from US$0.4m in the prior year period FieldFresh’s 1Q sales in Rupee terms were up 14%, while in US$ terms up 8% Del Monte packaged products was up with strong growth from key accounts and
Slide 26: Sustainability
Sustainability Del Monte delivered non-perishable food to residents displaced by the floods in Baton Rouge, Louisiana, through the American Red Cross and Feeding America Del Monte donated products to food banks in the US Updated the Business Continuity Plans in the Philippines, including La Ni
Slide 27: Awards
Awards DMPL’s CEO, Mr Joselito D Campos, Jr, bagged the Entrepreneur of the Year Award in the Asia Pacific Entrepreneurship Awards on 11 August 2016 in Singapore. The Award recognises and honours business leaders who have shown outstanding performance and tenacity in developing successful business
Slide 28: Debt Outlook
Debt Outlook Planned issuance of perpetual preference shares US$ perpetual preference shares To be listed on the Philippine Stock Exchange (PSE) Launch in CY2016 subject to all regulatory approvals and market conditions Received approvals from the Philippine SEC and Bangko Sentral ng Pilipin
Slide 29: 1Q FY2017 Results and Outlook
1Q FY2017 Results EBITDA of US$23.7m was 20% higher US subsidiary slightly lower sales driven by non-branded business but increased market share across major branded categories Del Monte Philippines and S&W continued to deliver strong performance Deleveraging planned with Preference Shares o