Maple Leaf Foods Inc. · TSX:MFI
Maple Leaf Foods — Q2 2019 Earnings Presentation
18 slides from Maple Leaf Foods's earnings presentation, Aug 1, 2019
Slide 1: Maple Leaf Foods Second Quarter 2019
Maple Leaf Foods Second Quarter 2019 Building momentum across the protein universe All dollar amounts are presented in Canadian dollars unless otherwise noted. MAPLE LEAF FOODS – Q2 2019 BUSINESS AND FINANCIAL REVIEW | AUGUST 1. 2019
Slide 2: Forward-looking Statements and non-IFRS Measures
Forward-looking Statements and non-IFRS Measures This presentation contains “forward-looking information” within the meaning of applicable securities law. These statements are based on current expectations, estimates, forecasts, and projections about the industries in which the Company operates, as
Slide 3: Strong top line growth with improved Adjusted EBITDA margin; raising the game in plant-based protein
Strong top line growth with improved Adjusted EBITDA margin; raising the game in plant-based protein ▪ Sales up 12.5%, driven by acquisitions and organic growth in value-added product portfolio ▪ Meat protein adjusted EBITDA margin of 11.3%, with gains in sustainable meat and branded portfolio despi
Slide 4: Our objectives today
Our objectives today 1. Review our meat protein business 2. Outline our view of the plant-based market and business potential 3. Describe how we are shifting our strategy to win in this hyper-growth market 4. Distinguish meat and plant-based protein for better shareholder visibility 4 MAPLE LEAF FOO
Slide 5: Strong commercial performance delivers a solid quarter
Strong commercial performance delivers a solid quarter Q2 2019 YOY change Sales ($M) $1,023 12.5% Adjusted EBITDA (%) 150 bps Meat Protein 11.3% Adjusted EBITDA (%) Total 10.6% 50 bps Adjusted EPS $0.33 2.9% Net Debt ($M) $403 $382 5 MAPLE LEAF FOODS – Q2 2019 BUSINESS AND FINANCIAL REVIEW | AUGUST
Slide 6: Building momentum in key growth drivers
Building momentum in key growth drivers ▪ Strong commercial performance across the business ▪ Increased prepared meats profit driven by brand mix, volume growth and supply chain improvements ▪ Sustainable meat continued to grow at double-digits ▪ Hog/Pork market headwinds of 100 bps versus LL: 40 5-
Slide 7: Our views of the plant-based protein market opportunity
Our views of the plant-based protein market opportunity ▪ We have a market leading position today ▪ We believe the drivers of growth will be protein consumption and diversification; not material substitution ▪ The plant-based market growth rate has accelerated dramatically ▪ Competitors all vying to
Slide 8: Vast growth runway in plant-based protein; $25B market opportunity by 2029
Vast growth runway in plant-based protein; $25B market opportunity by 2029 Refrigerated segment is underpenetrated compared Plant-based protein is expected to reach 10% - 15% of with other plant-based categories the meat protein market by 2029 versus 1% today US household penetration1 Forecasted pro
Slide 9: We are leading the way in the highest-growth refrigerated category
We are leading the way in the highest-growth refrigerated category 2019 retail market share1 22% All others 36% All others 14% #3 Field Roast 23% 22% Competitor 1 Competitor B 16% Field Roast 41% Market #1 42% Share Competitor A 25% Lightlife Refrigerated Refrigerated Cheese Meat Alternatives Altern
Slide 10: We have leading brands across multiple categories
We have leading brands across multiple categories Burgers Ground Dinner Sausage #1 Launched new plant- Launched new plant- Launched new plant-based Launched new plant- based Crumble in based Bratwurst and #1 based Burger in May #2 Ground in May June 2019 in Italian Sausages in May 2019 2019 2019 Foo
Slide 11: Bolstered by exciting new product launches
Bolstered by exciting new product launches Burgers Raw Ground ✓ First to market Sausages ✓ Launched two new Lightlife pea protein sausages and one new Field Roast beer ✓ Available at a growing list of retailers across North America bratwurst 11 MAPLE LEAF FOODS – Q2 2019 BUSINESS AND FINANCIAL REVIE
Slide 12: Leveraging our strengths, we are positioned to win a significant share of future growth
Leveraging our strengths, we are positioned to win a significant share of future growth Brand strength Innovation leaders Great products “We’ve had such awesome results, people are asking for it…this is Lightlife Smart Sausages here to stay” Chef John Humphreys, Kelsey’s Lightlife plant-based Ground
Slide 13: We are stepping on the gas in this hyper-growth market
We are stepping on the gas in this hyper-growth market ▪ Changing our operational imperative from “profitable growth” to investing for “revenue growth” – Differentiating from profitable meat protein and investment in plant-based protein ▪ To secure our market leading position significantly investing
Slide 14: What you need to know about our plant-based protein business today
What you need to know about our plant-based protein business today >$280M Forecasted ~$204M 2020 sales >$3B Current sales Target run rate 10-year sales (95% in retail) ~38% ~30% Sales CAGR Current Underlying since acquisition Gross Margin 14 Expectations are based on estimates and projections that h
Slide 15: One more thing to know about Maple Leaf Foods
One more thing to know about Maple Leaf Foods Planned construction capital with asset value Net debt as at June 30, 2019 in $M • World-class, value-added poultry facility $660M • $105M run-rate EBITDA by Total debt $470 2023 Cash $67 • World-class plant-based protein facility and network Net debt $4
Slide 16: Our core value drivers
Our core value drivers Meat protein – managed for Plant-based protein – managed for Planned construction capital with “profitable growth” “revenue growth & terminal value” asset value • #1 branded prepared meats in Canada • #1 in refrigerated plant-protein • World-class, value-added – Leading market
Slide 17: Our vision is to be the most sustainable protein company on earth
Our vision is to be the most sustainable protein company on earth ▪ Leaders in creating a sustainable enterprise ▪ Shifting the sustainability of meat protein ▪ Investing in hyper growth of plant protein ▪ Creating share value for all stakeholders 17 MAPLE LEAF FOODS – Q2 2019 BUSINESS AND FINANCIAL
Slide 18: Maple Leaf Foods
* ane | Maple Leaf Foods