Lassonde Industries, Inc. Class A · TSX:LAS.A
Lassonde Industries, Inc. Class A — Shareholder Meeting (May 2016)
38 slides from Lassonde Industries, Inc. Class A's shareholder meeting presentation, May 17, 2016
Slide 1: Annual General Meeting
LASSONDE INDUSTRIES INC. Annual General Meeting Financial Results for Fiscal 2015 and First Quarter 2016 MAY 17, 2016
Slide 2: Forward-Looking Statements
FORWARD-LOOKING STATEMENTS Certain statements made in this presentation, including, but not limited to, statements regarding the prospects of the industry, plans, financial position, and business strategy of the Company may constitute forward-looking statements within the meaning of Canadian securit
Slide 3: Highlights–Fiscal 2015
HIGHLIGHTS–FISCAL 2015 Earnings In millions of $ Years ended (except EPS) December 31 %∆ %∆ 2015 2014 2013 15 vs 14 14 vs 13 Sales 1,449.3 1,181.0 1,040.2 22.7% 13.5% Operating profit 111.3 88.4 83.1 25.9% 6.3% Operating profit/Sales 7.7% 7.5% 8.0% Profit 60.2 47.4 46.3 27.0% 2.3% Profit attributabl
Slide 4: Highlights–Fiscal 2015: Earnings (cont'd)
HIGHLIGHTS–FISCAL 2015 Earnings (cont'd) ● Sales of $1,449.3M, $268.3M vs $1,181.0M in 2014; ● Sales of Apple & Eve (A&E) up $159.8M: – 2015: $258.0M (for a full year); – 2014: $98.2M (five-month period following the acquisition); ● Favourable foreign exchange impact of $83.3M; ● $40.1M increase i
Slide 5: Highlights–Fiscal 2015: Earnings (cont'd)
HIGHLIGHTS–FISCAL 2015 Earnings (cont'd) ● Financial expenses of $27.8M vs $23.3M in 2014, by $4.5M; ● Explained by: – an unfavourable foreign exchange impact resulting from the conversion of the financial expenses of U.S. entities into Canadian dollars; and… – a higher change in the fair value of
Slide 6: Highlights–Fiscal 2015: Earnings (cont'd)
HIGHLIGHTS–FISCAL 2015 Earnings (cont'd) ● Profit attributable to shareholders totalled $57.0M in 2015, ( $11.8M) compared to $45.2M in 2014, and earnings per share were $8.15 compared to $6.47 in 2014. ● It should be noted that, after the allocation of financial expenses and income taxes, A&E’s pr
Slide 7: Consolidated Statements of Financial Position
HIGHLIGHTS–FISCAL 2015 Consolidated Statements of Financial Position In millions of $ As at December 31 %∆ %∆ 2015 2014 2013 15 vs 14 14 vs 13 Non-cash working capital 190.6 178.0 125.4 7.1% 41.9% Property, plant and equipment 271.3 251.8 248.4 7.7% 1.4% Total assets 1,143.8 1,016.7 796.8 12.5% 27.6
Slide 8: Free Cash Flow Analysis
HIGHLIGHTS–FISCAL 2015 Free Cash Flow Analysis In m illions of $ Years ended December 31 Variance 2015 2014 2015-2014 Free cash flow Profit 60.2 47.4 12.8 Adjustments Amortization and Depreciation 42.6 34.7 7.9 Pension plans, income tax and other 7.3 11.5 (4.2) Change in non-cash working capital 6.7
Slide 9: Highlights–First Quarter 2016
HIGHLIGHTS–FIRST QUARTER 2016 Earnings In millions of $ (except EPS) First Quarters ended April 2 March 28 %∆ $∆ 2016 2015 16 vs 15 16 vs 15 Sales 386.5 327.7 18.0% 58.8 Operating profit 27.4 17.0 61.7% 10.5 Operating profit/Sales 7.1% 5.2% Profit attributable to shareholders 13.0 7.8 66.9% 5.2 EBIT
Slide 10: Highlights–First Quarter 2016: Earnings (cont'd)
HIGHLIGHTS–FIRST QUARTER 2016 Earnings (cont'd) ● Sales of $386.5M, $58.8M from $327.7M in 2015: ● 18.0% increase explained by: – Five additional delivery days in 2016, increasing sales by approximately $27.0M; – Favourable exchange impact of $23.6M; – $15.2M increase in sales of private label pro
Slide 11: Highlights–First Quarter 2016: Earnings (cont'd)
HIGHLIGHTS–FIRST QUARTER 2016 Earnings (cont'd) ● Financial expenses of $5.7M vs $6.7M in 2015, $1.0M: ● Lower change in the fair value of participating loans; ● Decrease in interest expense arising from a reduction in indebtedness. ● “Other (gains) losses” went from a $1.3M gain in 2015 to a $0.9
Slide 12: Dividends and Outlook–Fiscal 2016
DIVIDENDS AND OUTLOOK–FISCAL 2016 ● Dividend: ● Quarterly dividend of $0.51 per share (payable on June 15 for Q1); ● Increase of 24.4% compared to 2015; ● On an annualized basis, usually represents approximately 25% of 2015 profit attributable to shareholders. ● Outlook: ● The Company’s sales were u
Slide 13: Grow and adapt to the market
LASSONDE INDUSTRIES INC. Grow and adapt to the market 13
Slide 14: Lassonde Industries Inc.
LASSONDE INDUSTRIES INC. 2015 Sales: $1,449.3 million Cash flows from operating activities: $116.8 million Lassonde Industries Inc. develops, manufactures, and markets distinctive food products. A. Lassonde Inc. Lassonde Arista Wines Lassonde Pappas Apple & Eve, LLC Specialties Inc. and Company, Inc
Slide 15: Geographic sales distribution
LASSONDE INDUSTRIES INC. Geographic sales distribution In CA$M $1 600 Canada United States Other $1 400 $1 200 $1 000 58% $800 $600 6% $400 41% 92% $200 $0 2010 2011 2012 2013 2014 2015 N.B.: The year 2014 includes 5 months of operations for Apple & Eve. 15
Slide 16: Rebranding in the U.S.
LASSONDE INDUSTRIES INC. Rebranding in the U.S. 16
Slide 17: Corporate Strategy
CORPORATE STRATEGY TO OFFER THE RIGHT PRODUCT IN THE RIGHT SIZE AT THE RIGHT PRICE TO CONSOLIDATE TO FOCUS ON HEALTHY PRODUCTS TO INNOVATE TO PROMOTE SUSTAINABLE DEVELOPMENT 17
Slide 18: To consolidate
CORPORATE STRATEGY To consolidate ● Stay on the lookout for business opportunities that enable us to improve our strategic positioning in the U.S. market; ● Maintain a balance between investment in our production capacity and the use of co-packers: ● Consider the acquisition of small co-packers to r
Slide 19: Offer the right product in the right size at the right price
CORPORATE STRATEGY Offer the right product in the right size at the right price ● Complexification of the beverage industry with hyper-segmentation. 1970-1979 Today CSDs CSDs RTD coffee Juice Juice Energy drinks Milk Milk Functional beverages Bottled water Fortified waters RTD tea Low-calorie/low-su
Slide 20: The human body loses 2.5 L of fluids per day
CORPORATE STRATEGY Offer the right product in the right size at the right price THE HUMAN BODY LOSES 2.5 L OF FLUIDS PER DAY 1.5 L 1.0 L 2.5 L Elimination Metabolism Lost per day SOURCE: www.passeportsante.net 20
Slide 21: We meet our fluid needs by
CORPORATE STRATEGY Offer the right product in the right size at the right price WE MEET OUR FLUID NEEDS BY Liquids Food 2 L/day 0.5 L/day % 20 % = 100 mL of juice/day SOURCE: www.passeportsante.net = 165 mL of juice/day 21
Slide 22: A human consumes 756 litres of fluids per year
CORPORATE STRATEGY Offer the right product in the right size at the right price A HUMAN CONSUMES 756 LITRES OF FLUIDS PER YEAR! 2,071 mL divided 756 L X 1,000mL 756,000 mL/year 2,071 mL/day by 250 mL (1 serving) 250 mL glasses per day 22
Slide 23: Sources of fluids
CORPORATE STRATEGY Offer the right product in the right size at the right price SOURCES OF FLUIDS HOT/COLD BEVERAGES TAP WATER OUTSIDE THE HOME: SOLD AT RETAIL RESTAURANTS, FOUNTAINS, THEATRES 396 L/year 180 L/year* 180 L/year* 4.3 glasses**/ 2.0 glasses**/ 2.0 glasses**/ day day day SOURCE: Euromon
Slide 24: Hot/cold beverages litres per year
CORPORATE STRATEGY Offer the right product in the right size at the right price HOT/COLD BEVERAGES 120 102,8 98 100 CANADA UNITED STATES Litres per year 80 TOTAL TOTAL 75 67,5 69 396.0 L 458.4 L 65,2 60,4 -5.0% -2.0% 60 56,3 52,4 47,3 44,2 40 36,4 21,7 20 12,4 6 7,9 3,8 4,5 4,5 3,7 2,1 2,9 1,6 2 0,1
Slide 25: Encourage people to be active to keep our markets healthy
CORPORATE STRATEGY Offer the right product in the right size at the right price PEOPLE WHO EXERCISE SHOULD DRINK 1 L MORE PER HOUR OF EXERCISE… WE MUST THEREFORE ENCOURAGE PEOPLE TO BE ACTIVE TO KEEP OUR MARKETS HEALTHY! 25
Slide 26: Packaging
CORPORATE STRATEGY Offer the right product in the right size at the right price ● Packaging 26
Slide 27: Wines
CORPORATE STRATEGY Offer the right product in the right size at the right price ● Wines 27
Slide 28: To innovate
CORPORATE STRATEGY To innovate ● The pillars of innovation at Lassonde: PACKAGING PROCESS INGREDIENTS MARKETING 28
Slide 29: To focus on healthy products
CORPORATE STRATEGY To focus on healthy products ● 100% juice vs drinks; ● Promote innovation for a “cleaner” lifestyle; ● More 100% fruit juices; ● More low-calorie/sugar products; ● More new blends and flavours to add the desired variety ● More healthy products; – Juice-based meal replacements (low
Slide 30: To focus on healthy products
CORPORATE STRATEGY To focus on healthy products ● MORE desirable ingredients and FEWER calories 30
Slide 31: Sustainable development
CORPORATE STRATEGY Sustainable development ● Promote sustainable development: one of our strategic pillars integrated into our management and innovation process through eco- and socio-friendly practices; ● Clear commitment to and continuous improvement objectives for our three priorities: water, pac
Slide 32: Follow-up on 2015 Priorities
FOLLOW-UP ON 2015 PRIORITIES Leverage synergies from the acquisition $1.9M increase in A&E of Apple & Eve EBITDA Large-scale deployment of the range of healthy Thickened juice, Oasis Active products in Canada and Oasis 70 calories Expansion of the range of A&E products with emphasis on launching bot
Slide 33: 2016 Priorities
2016 PRIORITIES ● Implement a long-term action plan to protect the profitability of our Canadian operations in a context of continued weakness of the Canadian dollar against the U.S. dollar; ● Maintain our organic growth through innovation (national brands) and by developing new solutions for our cl
Slide 34: Financial Performance
LASSONDE INDUSTRIES INC. Financial Performance 34
Slide 35: Selected Financial Information 5 Years
SELECTED FINANCIAL INFORMATION 5 YEARS Sales (in millions of $) EBITDA (in millions of $) *CAGR 5 years: 22.0% *CAGR 5 years: 18.4% 1 600,0 160,0 1 449,3 154,0 1 400,0 140,0 123,2 1 181,0 116,2 115,7 1 200,0 120,0 1 022,2 1 040,2 1 000,0 100,0 83,7 800,0 760,3 80,0 600,0 60,0 400,0 40,0 200,0 20,0 0
Slide 36: Selected Financial Information 5 Years (cont'd)
SELECTED FINANCIAL INFORMATION 5 YEARS (cont'd) EBIT (in millions of $) EPS (in $) * CAGR 5 years: 17.4% * CAGR 5 years: 11.1% 120,0 9,00 111,3 8,15 8,00 100,0 85,9 88,4 7,00 6,43 6,47 83,1 6,32 80,0 6,00 5,16 60,7 5,00 60,0 4,00 40,0 3,00 2,00 20,0 1,00 0,0 0,00 2011 2012 2013 2014 2015 2011 2012 2
Slide 37: Stock Price
STOCK PRICE As at April 2, 2016 Book value $74.27 As at May 11, 2016 Share value $174.13 The stock price increased from $62.50 as at May 11, 2011 to $174.13 as at May 11, 2016 for a total return of 179% (CAGR – 5 years: 22.7%). DIVIDENDS PER SHARE– 5 YEARS 2011 2012 2013 2014 2015 1.19 1.23 1.48 1.5
Slide 38: Questions
LASSONDE INDUSTRIES INC. Questions 38