Hormel Foods Corporation · NYSE:HRL
Hormel Foods — Investor Day (June 2017)
19 slides from Hormel Foods's investor day presentation, Jun 15, 2017
Slide 1: Don Kremin
Don Kremin 33 Years with Hormel Foods Group Vice President, Specialty Foods Hormel Foods Career History 2011: Group Vice President, Specialty Foods 2007: Vice President, Hormel Foods; Senior Vice President of Walmart Business, CPS 2005: Director of Walmart Business & Vice President, CPS 2004: Direct
Slide 2: Specialty Foods Group: A Long-Term Growth Story
Specialty Foods Group A Long-Term Growth Story Don Kremin Group Vice President, Specialty Foods Group
Slide 3: Agenda
Agenda • Specialty Foods Evolution • Protein is Core to Our Business
Slide 4: Strategic Pillars
Specialty Foods Group’s SPECIALTY FOODS EVOLUTION Strategic Pillars CORE HEALTH & NUTRITION
Slide 5: Portfolio Management is Improving Profitability
Portfolio Management is SPECIALTY FOODS EVOLUTION Improving Profitability Specialty Foods Operating Margin +230 bps 2013 2014 2015 2016 11.8% 9.5% CytoSport Combined Divested DCB Acquisition CytoSport and CFI 2013 2016
Slide 6: Our Core Portfolio
Our PROTEIN IS CORE Core Portfolio PRIVATE LABEL DESSERTS INGREDIENTS • Utilize capacity and raw materials • Expand margins with value-added solutions • Expand value-added ingredients portfolio
Slide 7: Protein is Key to Our Health & Nutrition Strategy
Protein is Key to Our PROTEIN IS CORE Health & Nutrition Strategy Least Active Lifestyle P R O T E I N Most Active Lifestyle RECOVERY ACTIVE PERFORMANCE Recovering patient, Active lifestyle, workout Physical Performance aiming to get back to 2-3 times per week important aspect of life, normal functi
Slide 8: Protein is Key to Our Health & Nutrition Strategy: Recovery
Protein is Key to Our PROTEIN IS CORE Health & Nutrition Strategy P R O T E I N RECOVERY Recovering patient, • Growing brand in recovery • Institutional Leadership in nutrition aiming to get back to dysphagia category • Making a difference in normal function cancer patients’ lives
Slide 9: Demography Shift Will Drive Hormel Health Labs Growth
Demography Shift PROTEIN IS CORE Will Drive Hormel Health Labs Growth There is a Growing Opportunity P R Outside O Tof Ethe ITraditional N Healthcare Industry U.S. Population Ages 65+ 80 70 +106% 72 People in Millions 60 50 56 40 48 40 30 35 20 10 0 2000 2010 2015 2020e 2025e Source: Home Care Assoc
Slide 10: Protein is Key to Our Health & Nutrition Strategy: Active Performance
Protein is Key to Our PROTEIN IS CORE Health & Nutrition Strategy P R O T E I N ACTIVE PERFORMANCE Active lifestyle, workout Physical Performance 2-3 times per week important aspect of life, workout every day
Slide 11: Protein Drives Growth
Protein Drives Growth PROTEIN IS CORE In the Enhanced Nutrition Category IRI MULO+C L12Weeks 4/9/17
Slide 12: Exceeding Our Valuation Proforma
PROTEIN IS CORE Exceeding Our Valuation Proforma 1. Capture synergies with CFI 2. Ignite innovation 3. Expand distribution We Did What We Said We Would Do
Slide 13: Capturing Synergies Between CytoSport & Century Foods
Capturing Synergies Between PROTEIN IS CORE CytoSport & Century Foods P R O T E I N GROWTH PRODUCTION Plant Assets, Purchasing and VALUE CREATION Sales, Marketing & Innovation Supply Chain Synergies 1. Enhanced Focus on Growth 2. Improved Asset & Capacity Utilization 3. Improved Service
Slide 14: Relentless Innovation: The Leader, Not A Follower
Relentless Innovation PROTEIN IS CORE The Leader, Not A Follower Innovation Sales 2014 2016 RTD +208% Powder Organic None Plant based None 2014 2016 Bars Internal Data IRI MULO+C 12 weeks ended 5/7/17
Slide 15: Innovation: MUSCLE MILK Bars Outselling Competition
Innovation: PROTEIN IS CORE MUSCLE MILK Bars ® Outselling Competition ACV Growth in FDM Units Per Store Per Week Per Item 24.0 2.1 16.0 1.8 1.7 11.9 1.4 8.5 11/20/16 01/15/17 3/12/17 05/07/17 Peer 1 Peer 2 Peer 3 IRI MULO+C L12 weeks ended 5/7/17 IRI MULO+C L12 weeks ended 5/7/17
Slide 16: Expand Distribution
PROTEIN IS CORE Expand Distribution FDMC DSD SPECIALTY 51% of Sales 38% of Sales 11% of Sales *IRI L52 weeks ending 8/10/14 vs. 2/12/17
Slide 17: Brand Investment
Brand PROTEIN IS CORE Investment Julie Ertz Clay Matthews Steph Curry 17
Slide 18: Specialty Foods Group: Future Focus
Specialty Foods Group PROTEIN IS CORE Future Focus 1. Exploit synergies between CytoSport and CFI 2. Expand MUSCLE MILK® product distribution and offerings across channels 3. Accelerate Hormel Health Labs growth 18
Slide 19: Specialty Foods Group: A Long-Term Growth Story
Specialty Foods Group A Long-Term Growth Story Don Kremin Group Vice President, Specialty Foods Group