Del Monte Pacific Limited · SGX:D03
Del Monte Pacific — FY2023 Earnings Presentation
41 slides from Del Monte Pacific's earnings presentation, Jun 19, 2023
Slide 1: Del Monte Pacific 4Q and FY2023 Results
DEL MONTE PACIFIC 4Q AND FY2023 RESULTS 19 June 2023
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 ▪ 4Q FY2023 Results ▪ FY2023 Results ▪ Dividend ▪ Market Updates ▪ Sustainability ▪ Outlook 3
Slide 4: Notes to the Results
Notes to the Results ▪ 4Q is from 1 February to 30 April 2023 ▪ DMPL owns 87% of Del Monte Philippines, Inc. and 93.6% of Del Monte Foods, Inc. DMPL recognizes a 13% and 6.4% non-controlling interest (NCI) in these two subsidiaries, respectively. These comprise the NCI line in the P&L. Net profit/(l
Slide 5: Highlights
Highlights 4Q FY2023 ▪ Sales grew by 3% to US$585m on higher USA and fresh pineapple sales, up by 4% and 5%, respectively ▪ Posted EBITDA of US$55m, down by 30% on higher costs amidst inflationary environment ▪ Lower operating income and increased interest expense from redemption of Preference Share
Slide 6: Outlook
Outlook ▪ The global environment remains unstable with certain cost pressures and consumers becoming more cautious with their spending ▪ Remain vigilant in managing our operating expenses which include: ✓ packaging materials optimization; ✓ power and fuel initiatives; ✓ investments to improve effici
Slide 7: 4Q FY2023 Results Summary
4Q FY2023 Results Summary ▪ Sales of US$584.6m, +3% Sales % Change Americas +4 Philippines flat (in peso terms +7) International +1 India (equity accounted) +0.7 (in rupee terms +11) All figures below are vs prior year quarter and excluding one-off items of US$1.4m net: ▪ EBITDA of US$56.9m, down 27
Slide 8: 4Q FY2023 Results – Reported Basis
4Q FY2023 Results – Reported Basis In US$m 4Q FY2022 4Q FY2023 Chg (%) Comments Turnover 569.5 584.6 +2.6 Higher sales in USA and fresh pineapple exports Gross profit 147.6 117.8 -20.2 Higher costs and unfavorable sales mix Gross margin (%) 25.9 20.2 -5.7ppts Same as above EBITDA 78.2 55.0 -29.7 Sam
Slide 9: 4Q FY2023 Turnover and Operating Profit Analysis
4Q FY2023 Turnover and Operating Profit Analysis Sales Operating 1.9% Profit 0.8% 24.4% Americas 25.6% 73.7% Asia Pacific 73.6% Europe Sales growth Comments Americas +3.9% ▪ Driven by higher branded retail sales which grew by 5% across key categories of canned vegetable, fruit cup, tomato and Joyba
Slide 10: FY2023 Results Summary
FY2023 Results Summary ▪ Sales of US$2.4bn, +3% Sales % Change Americas +4 Philippines -4 (in peso terms +7) International +12 India (equity accounted) +0.4 (in rupee terms +8) All figures below are vs prior year period and excluding one-off items: ▪ EBITDA of US$337.2m, down 4% vs US$351.5m due to
Slide 11: FY2023 One-Off Item
FY2023 One-Off Item ▪ In May 2022, DMFI raised US$600m through a 7-year Term Loan B facility at Adjusted SOFR, with a floor of 0.5% plus 4.25% p.a., to primarily redeem the US$500m Senior Secured Notes which had an interest rate of 11.875% p.a. ▪ Term Loan B has a much lower interest rate (8.1% p.a.
Slide 12: FY2023 Results – Reported Basis
FY2023 Results – Reported Basis In US$m FY2022 FY2023 Chg (%) Comments Turnover 2,342.1 2,421.3 +3.4 Higher sales in USA and international markets Gross profit 622.7 607.0 -2.5 Higher costs and unfavorable sales mix Gross margin (%) 26.6 25.1 -1.5ppts Same as above EBITDA 351.5 329.7 -6.2 Same as ab
Slide 13: FY2023 Turnover and Operating Profit Analysis
FY2023 Turnover and Operating Profit Analysis Sales Operating 2.0% Profit 2.8% 26.2% Americas 32.2% 71.8% Asia Pacific 65.0% Europe Sales growth Comments Americas +4.4% ▪ Higher branded retail sales which grew by 8%. Branded retail accounted for 75% of DMFI’s sales ▪ Incremental sales of US$35.1m fr
Slide 14: Dividend
Dividend The Board approved a final dividend of 0.13 US cent (US$0.0013) per share representing 15% of FY2023 net profit For the fiscal year ended 30 April 2022 2023 Name of dividend Final Ordinary Final Ordinary Type of dividend Cash Cash Rate of dividend US$0.0170 per US$0.0013 per ordinary share
Slide 15: Market Updates
Del Monte MARKET UPDATES
Slide 16: Del Monte Foods USA 4Q and FY2023
Del Monte Foods USA 4Q and FY2023 4Q FY2023 ▪ DMFI’s sales were US$428.7m or 73% of Group turnover ✓ Sales up 4% on higher branded retail sales of canned vegetable, fruit cup, tomato and Joyba bubble tea ✓ Pricing actions, distribution gains of Joyba, higher sales of specialty veg and multipacks ✓ P
Slide 17: USA Market Shares
USA Market Shares Canned Vegetable (#1) Canned Fruit (#1) Fruit Cup Snacks (#2) Canned Tomato (#3) Broth without and with Kitchen Basics (#2) Source for market shares: Nielsen RMS / Scantrack DMFI Custom DBs, Eq Vol share, Total xAOC, Latest 3M ending 29 April 2023 ▪ Del Monte maintained its leading
Slide 18: USA 4Q – Marketing Highlights
USA 4Q – Marketing Highlights Del Monte Fruit Cup Snacks Take Root Organics 18
Slide 19: USA 4Q – Marketing Highlights
USA 4Q – Marketing Highlights National Frozen and Refrigerated Foods Association Sponsorship • 16 Customers/32 Banners • March 1-31, 2023 • Digital Ad to Cart Program – Ads based on specific distribution • Influencers (1 National/1 Kroger specific) • Recipe Page (Three Riced Veg recipes featured) 19
Slide 20: USA 4Q – PR Highlights
USA 4Q – PR Highlights 1.3 Billion Impressions 20
Slide 21: USA 4Q – Foodservice
USA 4Q – Foodservice New Business Growth Del Monte was chosen as the branded Del Monte’s new Peach Salsa with Morita Pineapple partner, replacing a competitive Chiles was featured as a Limited Time Offer brand. A full category conversion of #10 cans within all Healthcare cafeterias. and juice. 21
Slide 22: USA – We Deliver Health and Nutrition
USA – We Deliver Health and Nutrition 22
Slide 23: USA – Addressing Key Trends
USA – Addressing Key Trends 23
Slide 24: USA – A Balanced Healthy Portfolio
USA – A Balanced Healthy Portfolio Good, Better, Best Portfolio Enables Channel Expansion and Drives Market Share Gains 24
Slide 25: USA – Channel Diversification
USA – Channel Diversification Case Study: Our Channel Diversification Through Expanded Customer Reach 25
Slide 26: USA – Joyba Craze
USA – Joyba Craze The Joyba Craze Continues as we Expand Distribution • Joyba SKUs are the Top 4 dollar velocity items per store per week in ready to drink tea category at Target 26
Slide 27: DMPL ex-DMFI 4Q and FY2023
DMPL ex-DMFI 4Q and FY2023 4Q FY2023 ▪ Sales of US$180.3m, up 3%, on higher International sales ▪ Philippine Market sales of US$68.5m, +7% in peso terms but flat in USD terms ✓ Higher sales of packaged fruit, culinary and new products behind compelling communication campaigns and value-for-money off
Slide 28: Philippines – Market Shares
Philippines – Market Shares +1.9pts +1.9pts +0.6pt Packaged Pineapple (#1) Canned Mixed Fruit (#1) RTD Juices ex foil pouches (#1) -0.4pt -1.2pts -8.6pts Tomato Sauce (#1) Spaghetti Sauce (#1) Drinking Yogurt, DM Vinamilk + Mr. Milk (#2) ( Source for Volume market shares: The Nielsen Company - Retai
Slide 29: Philippines – Marketing
Philippines – Marketing Tomato Sauce - Spaghetti Sauce Cooking adobo with Sustaining TV + Digital Sweet & Cheesy KOL pineapples campaign Saucy Campaign Campaign featuring No.1 Sweet Style Value Pack Quick ‘N Easy Curry Mix KOL Campaign 29
Slide 30: Philippines – Beverage Recovery Plan
Philippines – Beverage Recovery Plan Compelling Communication Campaigns with Value-for-Money Offers In-Store 100% Pineapple Juice: All-out Juice Drinks: Juice Up Your Life, Fit ‘n Right: Original is Back! nutrients to do more everyday Perfect for Meals Your Fitness Your Way Melon Cucumber Permanent
Slide 31: Philippines – Innovation
Philippines – Innovation Innovation now accounts for 8% of total Philippine Sales Combined addressable market of these products is US$3.5bn Potato Crisp Flavor Range: Original, Spicy; New in FY2023: Cheese, BBQ, 20g Del Monte Vinamilk Range Flavor Range: Fresh Milk; IQ Smart Chocolate, Vanilla, Stra
Slide 32: Philippines – Innovation
Philippines – Innovation New Mr. Milk Orange Flavor Mr. Milk ‘Summer’ Digital Tie Up Sampling with #1 Toy Reach Program Store (Toy Kingdom) Del Monte Potato Crisp Selective Regional Launch of Singles Trial Packs 32
Slide 33: Philippines – Foodservice and Convenience
Food Service & Convenience Stores Philippines – Foodservice and Convenience Opening of Restaurants & Convenience Stores accelerated growth in FY2023 ▪ 4Q sales up 18% vs prior year period ▪ 4Q sales up 10.5% vs prior year period ▪ 9,917 foodservice outlets now open at 92% ▪ 3,995 convenience stores
Slide 34: International – Innovation
International – Innovation Innovation now accounts for 15% of Total International Sales Total sales potential of these products is US$100m NICE FRUIT Frozen Snacks Japan Middle East Japan Europe CANADA US Saudi Singapore China Hongkong 7-11 McDonald’s 7-Eleven Lamex/KFC McDonald’s Del Monte Arabia P
Slide 35: S&W Fresh Overview
S&W Fresh Overview ▪ Our high quality, premium MD2 fresh pineapple makes us the largest fresh pineapple exporter to China, with 53% volume share ▪ One of the 3 biggest fresh pineapple exporters to Japan, South Korea and the Middle East ▪ Introduced last year, the naturally-ripened extra sweet S&W De
Slide 36: S&W China
S&W China ▪ S&W team visited our partners in China. The visit aims to further strengthen our relationship with our distributors and partners and continuously seek growth opportunities of S&W Sweet 16 Pineapple and S&W Deluxe Pineapple in China. S&W-Goodfarmer Deluxe Pineapple display at Hema The S&W
Slide 37: S&W promotional event at FABEX Tokyo
S&W A promotional event for Contadina MD2 Canned Pineapple was held during FABEX (World Food And Beverage Great Expo) from April 12 to 14 at the Tokyo Big Sight Exhibition Center, led by our distributor, J Gerber & Co., Ltd. The exhibit, which focuses on food manufacturing such as bakery and confect
Slide 38: Del Monte India
Del Monte India ▪ Del Monte India’s sales in 4Q were up 11% in Rupee terms due to higher sales across B2B and B2C channels New Chocolate Syrup 100g pack ▪ Gross margin improved to 17.6% from 10.0% with continued After a successful cost management launch of the 600g ▪ DMPL’s share in Del Monte India
Slide 39: Sustainability
Sustainability Carbon Footprint EPR Program Energy Conservation Foundation Programs Energy Savings Intensified the Two of the Foundation’s Following the The company has independent cannery’s Energy environmental developed an Extended certification of its Producer Responsibility Conservation Program
Slide 40: Sustainability
Sustainability Upcycling/Stop Food Waste Day Earth Day Del Monte Foods distributed a media release for DMFI shared social media posts Stop Food Waste Day which was picked up across about sustainable packaging trade and industry publications efforts across corporate, careers and brand social channels
Slide 41: Outlook
Outlook ▪ The global environment remains unstable with certain cost pressures and consumers becoming more cautious with their spending ▪ Remain vigilant in managing our operating expenses which include: ✓ packaging materials optimization; ✓ power and fuel initiatives; ✓ investments to improve effici