Sprouts Farmers Market, Inc. · NASDAQ:SFM
Sprouts Farmers Market — Investor Presentation (April 2025)
31 slides from Sprouts Farmers Market's investor presentation, Apr 30, 2025
Slide 1: Sprouts Farmers Market Investor Deck April 2025
SPROUTS FARMERS MARKET Investor Deck April 2025 Exhibit 99.3
Slide 2: Forward-Looking Statements
Forward-Looking Statements Certain statements in this presentation are forward-looking as defined in the Private Securities Litigation Reform Act of 1995. Any statements contained herein that are not statements of historical fact (including, but not limited to, statements to the effect that Sprouts
Slide 3: Our Purpose: We Help People Live and Eat Better
OUR PURPOSE We help People Live and Eat Better 3
Slide 4: Sprouts' Long-Term Strategy
SPROUTS’ LONG-TERM STRATEGY OUR PURPOSE INVEST IN TECHNOLOGY FOR SCALEABLE GROWTH INSPIRE AND ENGAGE OUR TALENT TO MAKE SPROUTS A BEST PLACE TO WORK DELIVER ON KEY FINANCIAL METRICS EARNINGS GROWTH STORE EXPANSION SALES GROWTH OUR STRATEGY WIN WITH TARGET CUSTOMERS • Win health attributes, quality &
Slide 5: Why Invest in Sprouts Farmers Market?
WHY INVEST IN SPROUTS FARMERS MARKET? DIFFERENTIATED ASSORTMENT Foraging for Innovation High-quality Sprouts Brand Curated & differentiated products TEAMS & CULTURE Strong executive team Talent engine Commitment to community & planet INCREDIBLE GROWTH OPPORTUNITY Plenty of white space Advantaged sup
Slide 6: Differentiated Assortment: Foraging for Innovation
DIFFERENTIATED ASSORTMENT Foraging for Innovation 6 • Innovation Center showcases new items monthly • More than 7,100 new items introduced in 2024
Slide 7: Differentiated Assortment: High Quality Sprouts Brand
Sprouts Brand Sales Penetration(1) • $1.7B in sales of Sprouts Brand Products in 2024 • 300 Sprouts Brand products launched in 2024 (1) Sprouts Brand Sales Penetration represents sales of Sprouts Brand products, as a percentage of total company sales. 7 DIFFERENTIATED ASSORTMENT High Quality Sprouts
Slide 8: More than 70% of Products Sold are Attribute-Driven
>20% Vegan >30% non-GMO >45% organic >55% gluten-free >35% organic ~30% vegan >60% Non-GMO >50% organic >25% plant-based 100% cage-free or better eggs >45% gluten-free >40% Non-GMO >20% vegan ~ 25% organic >70% gluten-free >50% Non-GMO >40% vegan ~20% gluten-free >10% non-GMO ~25% organic >20% Koshe
Slide 9: Target Customer Focus: Huge Opportunity
9 • Focus on natural and organic products (vs. CPG), a fast-growing channel of food at home • Emphasis on Target Customer segment • Huge opportunity to grow target customer share of wallet • Tailored marketing highlighting attributes & store experience • Innovation center with latest healthy trends
Slide 10: Demographics: Consumer Who Craves Health & Wellness
• Continue to attract younger customers • Slightly higher educated • Skews higher income- less susceptible to economic downturn • Over half are married/relationship – typically dual income • Majority of ecommerce customers are omnichannel with higher share of wallet • Seeks high quality, lifestyle-f
Slide 11: Opportunity for Further Engagement
• Customers love shopping at Sprouts - they have unique needs and want differentiated products • Huge opportunity for further engagement: only 15% of customers were identifiable • Gathering more data allows us to better understand and serve our target customers: • Personalized experience • Product r
Slide 12: Farmers Market Feel & Produce at the Heart of the Store
12 Hybrid produce buying model: centralized and regional teams allow us to offer the freshest product to our customers Meaningful farmer partnerships: delivers new varietals and ensures long-term supply at lower costs Increasingly locally sourced fresher produce, through new distribution channels Or
Slide 13: Friendly & Knowledgeable Team Members
• Small size reinforces farmers’ market appeal • Low profile layout enables customer interaction • CSAT Scores are best in company history • NPS scores at +61, with only 5% detractors(1) • Improved in-stocks • Ecomm penetration > 14% of sales(2) • Ecomm increases customer access: can shop wherever,
Slide 14: Incredible Growth Opportunity: Plenty of White Space
Potential for 1000+ stores from coast to coast 14 INCREDIBLE GROWTH OPPORTUNITY Plenty of White Space
Slide 15: Advantaged Fresh Supply Chain
Improved Freshness for the Customer: • Took a day out of the inventory cycle Local: • Partnering with 170 local farmers representing more than 19% of total produce sales Benefits of Closer DCs: Efficiency • ~80% (and increasing) of stores within 250 miles of DC • Reduced total miles driven per store
Slide 16: Executive Management Team with Leading Grocery & Retail Experience
16 TEAMS AND CULTURE Executive Management Team with Leading Grocery & Retail Experience Jack Sinclair Chief Executive Officer since 2019 Curtis Valentine Chief Financial Officer since 2024 (joined SFM in 2015) Scott Neal Chief Merchandising Officer since 2022 (joined SFM in 2020) Dustin Hamilton Chi
Slide 17: Three Simple Values at the Heart of our Strong Culture
• $30M in bonuses paid to field team members • $23M in savings for team members with store discount WE CARE WE OWN ITWE LOVE BEING DIFFERENT 17 TEAMS AND CULTURE Three Simples Values at the Heart of our Strong Culture
Slide 18: Creating a Talent Engine to Support our Growth
In 2024: • 3,300 New jobs created • 33,200 Leadership training hours delivered • $20.59/hr Average pay rate for store team members • 54% Store Manager positions filled with internal candidates 18 TEAMS AND CULTURE Creating a Talent Engine to Support our Growth
Slide 19: Commitment to Community & Planet at Sprouts in 2024
• 71% landfill diversion rate • 70M pounds of food recovered through donation, animal feed, and composting programs • 60% of sales of products with a social or environmental attribute • 30% of total sales from Organic products • 2% intensity reduction in carbon emissions per square foot, against our
Slide 20: Long-term Strategic Financial Targets
Attractive New Store Economics ~10%-unit growth(2) Low single digit comps Stable EBIT Margins off a Higher Base Low Double-Digit Earnings Growth and Expansion of ROIC (1) These are targets and not projections; they are subject to significant business, economic and competitive uncertainties and conti
Slide 21: Attractive New Store Economics
EBITDA MARGINS • Break even year 1 • Grows to a blended ~8% EBITDA Margins over the next 4 years CASH INVESTMENT • $3.8M average new store build including CapEx, Inventory and Pre-opening expenses 1. These are targets and not projections; they are subject to significant business, economic and compet
Slide 22: Comp Drivers and EBIT Margin Targets
(1) These are targets and not projections; they are subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond the control of the Company and its management, and are based on assumptions with respect to future decisions, which may be subject t
Slide 23: Stronger Foundation: Strategic Initiatives Taking Hold
(1) See the Appendix to this presentation for a reconciliation of Adjusted Diluted Earnings Per Share to diluted Earnings Per Share and Adjusted EBIT margin to EBIT margin 23 NET SALES ($ in mm) ADJUSTED DILUTED EARNINGS PER SHARE ADJUSTED EBIT MARGIN HEALTHY FINANCIALS Stronger Foundation: Strategi
Slide 24: Strong Balance Sheet, Robust Cash Flows
Self Fund our Growth and Deliver Shareholder Value through Ongoing Share Repurchase Program 1. Capital expenditures are net of landlord reimbursement 2. Excluding excise tax (1) (2) 24 HEALTHY FINANCIALS Strong Balance Sheet, Robust Cash Flows
Slide 25: Improving ROIC: Smart Investments Driving Strong Returns
(1) ROIC is a non-GAAP measure defined as net operating profit after taxes divided by average invested capital. See the Appendix to this presentation for a reconciliation of ROIC to net income. 25 HEALTHY FINANCIALS Improving ROIC(1): Smart Investments Driving Strong Returns
Slide 26: We Help People Live and Eat Better
Sprouts delivers a unique farmers market experience: bringing together passionate, knowledgeable team members, and the best assortment of high-quality food 26 We Help People Live and Eat Better
Slide 27: Appendix
APPENDIX 27
Slide 28: Sprouts' Strategy Milestones
SPROUTS’ STRATEGY MILESTONES 20242023MILESTONES2020/2021 Customer Store Format Supply Chain Team Financials • E-commerce Boom • Change in Promotional Strategy • Positive Traffic • Sprouts Brand reaches > $1B sales • Foraging Team • Ecommerce – added Doordash • Innovation Center • Ecommerce reaches >
Slide 29: Non-GAAP Measure Reconciliation
APPENDIX SPROUTS FARMERS MARKET, INC. AND SUBSIDIARIES NON-GAAP MEASURE RECONCILIATION (UNAUDITED) (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS) The following table shows a reconciliation of adjusted gross margin to gross margin, EBIT and adjusted EBIT to net income, adjusted EBIT margin to EBIT margin,
Slide 30: ROIC Reconciliation to Net Income
APPENDIX The following table shows a reconciliation of ROIC to net income for the Company’s 2021, 2022, 2023 and 2024 fiscal years SPROUTS FARMERS MARKET, INC. AND SUBSIDIARIES NON-GAAP MEASURE RECONCILIATION (UNAUDITED) (IN MILLIONS) (1) Net income amounts represent total net income for the past fo
Slide 31: Thank You!
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