Freshpet, Inc. · NASDAQ:FRPT
Freshpet — Investor Presentation (June 2018)
26 slides from Freshpet's investor presentation, Jun 6, 2018
Slide 1: Investor Presentation: June 2018
Investor Presentation: June 2018 Exhibit 99.1
Slide 2: Forward Looking Statements
Forward Looking Statements This presentation contains “forward-looking” statements that involve risks, uncertainties and assumptions. If the risks or uncertainties ever materialize or the assumptions prove incorrect, the Company’s results may differ materially from those expressed or implied by such
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Slide 4: In 2017, we launched our new strategy
In 2017, we launched our new strategy . . .
Slide 5: Growth Goal: $300 million net sales as soon as 2020
Growth Goal: $300 million net sales as soon as 2020 Future Economic Model FY 2016 FY 2020 Growth Rate 15% 15-20% Stores 16,609 23,000 Adj. Gross Margin 50.9% 53.9% Adj. EBITDA Margin 13% 20+% Media Investment ~6% of sales ~9% of sales Advertising Payback 1.5 yrs -- Free Cash Flow -$13.9M ~15% of sal
Slide 6: And the growth accelerated
And the growth accelerated . . . . Nielsen Mega-Channel: XAOC + Pet + WFM Sales Growth
Slide 7: Increased awareness and penetration
Increased awareness and penetration . . . 1.4%
Slide 8: But still well below our competitors
Freshpet Rachel Ray Blue Buffalo Purina ONE Cesar Awareness (Aided) 35% 52% 86% 82% 70% Penetration 1.4% 3.6% (dry) ~8% (est) 5.2% (dry) 3.4% (wet) But still well below our competitors . . . Source: 2016 Brand Tracker, IRI 2016 HH Panel
Slide 9: Strong velocity growth
Strong velocity growth . 2017 Same Stores Sales Growth By Vintage Representative Customer 35.0% 33.4% 29.3% 30.0% 26.7% 25.0% 20.7% 21.1% 19.4% 1 ™ Original $/S/W mJan-12 $/S/W ® Jan-13 $/S/W m Jan-14 $/S/W mJan-15 $/S/W m Jan-16 $/S/W 20.0% 15.0% 10.0% 5.0% 0.0% Fr éshp t FEED THE GROWTH?#
Slide 10: Which helped Freshpet grow into its scale in 2017
Which helped Freshpet grow into its scale in 2017. . . 100 bps reduction *Leverage adjusted to projected inflationary growth of infrastructure By 2020: 900 bps reduction in fixed costs
Slide 11: Benefits of scale and velocity
Benefits of scale and velocity Fixed Cost Pick-Up Manuf. overhead absorption G&A overhead absorption Logistics More cases per pallet More pallets per order/full trucks More straight pallets Ultimately, fewer miles per order Retail Presence Lower % sales to service fridges Higher frequency retail cov
Slide 12: Year II: Bigger and Faster
Freshpet FEED THEG GROWTH/ YEAR II: Bigger and Faster
Slide 13: In 2018, we are accelerating fresh growth
In 2018, we are accelerating fresh growth. . . +15% +17.5% >21% >23% 2018 Fresh-only sales: +23% 20172018% Change Net Sales$152.4>$18521+% Adjusted EBITDA$17.6>$2014+% 2018 Guidance $ in millions
Slide 14: Doubling down on Media: 60% increase for the second year in a row
Doubling down on . . . Media: 60% increase for the second year in a row Each quarter will increase vs. YA 70/30 first half vs. second half spending
Slide 15: Doubling down on Velocity drivers
Doubling down on . . . Velocity drivers: Upgraded fridges Focused innovation Premiumization & Added Variety Select Roasted Meals Grain Free Select Roasted Meals Multi-Protein Select Beef Roasted Meals Small Dog After Before
Slide 16: And the growth has accelerated again
And the growth has accelerated again. . . . YTD ‘18 consumption +25% Nielsen Mega-Channel: XAOC + Pet + WFM Sales Growth
Slide 17: Growth is driven by advertising that drives penetration
Growth is driven by advertising that drives penetration. . .
Slide 18: Just scratching the surface of HH penetration potential
Just scratching the surface of HH penetration potential . . . By 2025, there will be 7.5 million HH’s who have expressed top 2 box purchase interest in the Freshpet idea – and we have reached <2 million so far Prime Prospects With Top 2 Box Purchase Interest in Freshpet Concept PP’s with Positive In
Slide 19: Also driving buying rate up
Also driving buying rate up . . .
Slide 20: Business surpassing $500 million by 2023
At existing media efficiencies, we could create a business surpassing $500 million by 2023. . . . and still growing quickly
Slide 21: Further strengthening our barriers to entry
Further strengthening our barriers to entry . . .
Slide 22: Enabling us to expand our manufacturing advantage
Enabling us to expand our manufacturing advantage . . . Improving Safety, Quality, Value, Customer Delight 22 Quakertown Kitchens Kitchens 2.0
Slide 23: By creating Freshpet Kitchens 2.0
By creating Freshpet Kitchens 2.0 . . . Use automation to further improve: Quality Safety Cost
Slide 24: Kitchens 2.0 plan will deliver
Kitchens 2.0 plan will deliver . . . Efficient use of capital: Payback in <2 years Strengthened manufacturing expertise advantage: Increased automation delivers improved quality, safety and lower cost – improving gross margins Continued focus on existing gross margin improvement goals: We will not l
Slide 25: Positioning Freshpet for future growth beyond 2020
Positioning Freshpet for future growth beyond 2020. . . 7.5 MM HH’s +10%/year 10% of sales UK and beyond 23,000+ stores Growth Potential: 2020 and beyond HH Penetration Buying Rate New Stores Geographic Expansion E-commerce
Slide 26: Delighting pet parents, pets, shareholders and employees
Delighting pet parents, pets, shareholders and employees . . .