Del Monte Pacific Limited · SGX:D03
Del Monte Pacific — 2Q FY2020 Earnings Presentation
33 slides from Del Monte Pacific's earnings presentation, Dec 6, 2019
Slide 1: 2Q FY2020 Results
T N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® D E L M O NT E PACIFIC 2Q F Y 2 0 2 0 R E S U L T S 6 December 2019 NOURISHING FAMILIES. ENRICHING LIVES. EVERY DAY. ®
Slide 2: Disclaimer
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® 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 as
Slide 3: Contents
CONTENTS ▪ Summary ▪ 2Q FY2020 Results ▪ 1H FY2020 Results ▪ Market Updates ▪ Sustainability ▪ Outlook 3
Slide 4: Notes to the 2Q FY2020 Results
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® NOTES TO THE 2Q FY2020 RESULTS ▪ Second quarter is 1 August to 31 October 2019. ▪ DMPL’s effective stake in DMFI is 89.4%, hence the non controlling interest line (NCI) in the P&L. Net income/(loss) is net of NCI. ▪ DM
Slide 5: 2Q FY2020 Highlights
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® 2Q FY2020 HIGHLIGHTS ▪ Positive outcomes backed by strong sales growth in fresh pineapple in North Asia, increased sales in the Philippine market, and transformational initiatives at US subsidiary ▪ Gross profit, gross
Slide 6: Outlook
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® OUTLOOK ▪ Barring unforeseen circumstances, the DMPL Group is expected to remain profitable in FY2020 on a recurring basis (without one-offs). ▪ Major emphasis on responding to consumer trends through: ✓ Strengthening
Slide 7: DMPL 2Q FY2020 Group Results Summary
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® DMPL 2Q FY2020 GROUP RESULTS SUMMARY ▪ Sales of US$558.7m, +0.4% Sales % Change US -4 Philippines +9 (in peso terms +5) S&W +27 FieldFresh India (equity accounted) +5 (in rupee terms +6) All figures below without one-o
Slide 8: DMPL 2Q FY2020 One-off Expense/(Income)
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® DMPL 2Q FY2020 ONE-OFF EXPENSE/(INCOME) In US$ m 2Q FY19 2Q FY20 Booked under Plant closures (1.9) 75.5 CGS/G&A/Misc Expense Seed operation (1.1) - Other Expense Severance 1.7 1.2 G&A Expense Others (0.4) 0.1 Interest
Slide 9: DMPL 2Q FY2020 Results – As Reported
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® DMPL 2Q FY2020 RESULTS – AS REPORTED 2Q 2Q In US$m Chg (%) Comments FY2019 FY2020 Turnover 556.3 558.7 +0.4 Higher Philippines and S&W Asia offset by lower US sales Price increase in the US and Philippines, divested Sa
Slide 10: DMPL 2Q FY2020 Turnover Analysis
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® DMPL 2Q FY2020 TURNOVER ANALYSIS 2% 27% Americas 71% Asia Pacific Europe Americas -4.4% ▪ In line with strategy, divested the low-margin Sager business. Stripping it out, sales would have been down 2.5% ▪ Lower sales o
Slide 11: DMPL 1H FY2020 Group Results Summary
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® DMPL 1H FY2020 GROUP RESULTS SUMMARY ▪ Sales of US$934.6m, -5.9% Sales % Change US -12 Philippines +7 (in peso terms +4) S&W +23 FieldFresh India (equity accounted) +4 (in rupee terms +7) All figures below without one-
Slide 12: DMPL 1H FY2020 One-off Expense/(Income)
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® DMPL 1H FY2020 ONE-OFF EXPENSE/(INCOME) In US$ m 1H FY19 1H FY20 Booked under Plant closures 6.4 77.2 CGS/G&A/Misc Expense Seed operation (1.1) - Other Expense Severance 1.8 1.6 G&A Expense Others - 0.2 Interest income
Slide 13: DMPL 1H FY2020 Results – As Reported
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® DMPL 1H FY2020 RESULTS – AS REPORTED 1H 1H In US$m Chg (%) Comments FY2019 FY2020 Turnover 993.5 934.6 -5.9 Higher Philippines and S&W Asia offset by lower US sales Price increase in the US and Philippines, divested Sa
Slide 14: DMPL 1H FY2020 Turnover Analysis
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® DMPL 1H FY2020 TURNOVER ANALYSIS 2% 30% Americas 68% Asia Pacific Europe Americas -11.7% ▪ In line with strategy, divested the low-margin Sager business ▪ Lower sales of low-margin non-branded businesses ▪ Lower packag
Slide 15: Market Updates for 2Q FY2020
15 Market Updates for 2Q FY2020
Slide 16: USA
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® USA Market Share (#1) Market Share (#1) Market Share (#2) Market Share (#2) Canned Vegetable Canned Fruit Fruit Cup Snacks Canned Tomato ▪ Maintaining solid share across legacy categories, while expanding into perimete
Slide 17: Del Monte Foods USA 2Q Results
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® DEL MONTE FOODS USA 2Q RESULTS DMFI’s 2Q sales down 5% to US$396.2m ▪ Divested low-margin Sager Creek vegetable business ▪ Reduced sales of low-margin non-branded business ▪ Timing of holiday shipments resulting from a
Slide 18: USA - Innovation
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® USA - INNOVATION Del Monte Veggieful Veggie Bowls Contadina Pizzettas Mobile Tour The Pizzettas Mobile Tour covering 12 cities! Pinterest FB/Instagram Branded Food Truck Sampling Photo Booth Retail Search Start Ship: A
Slide 19: USA - Innovation
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® USA - INNOVATION College Inn Culinary Stock College Inn Simple Starter Digital Display Social Media Consumer Promotion Consumer Promotion Social Media Start Ship: July Start Ship: July Each glass jar: Each container: ✓
Slide 20: USA – Back to School
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® USA – BACK TO SCHOOL Fruit Cup Snacks Promotions and Performance • Higher volume with better pricing, quality, and duration • New product Del Monte Bubble Fruit helps bring new news and traction to this category 20
Slide 21: USA - Foodservice
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® USA - FOODSERVICE Pouch Pineapple win at College Inn Digital Getting Social with Barro’s Pizza Promotions Riced Cauliflower • New digital campaigns have • Del Monte Harvest Selects Riced been launched to Foodservice Ve
Slide 22: FY2020 Asset-Light Strategy
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® FY2020 ASSET-LIGHT STRATEGY ▪ On 1 November 2019, DMFI successfully sold and transitioned Cambria, Wisconsin operations and related employees to Seneca Foods Corporation ▪ Also entered into an agreement to sell product
Slide 23: Philippines
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® PHILIPPINES Market Share (#1) Market Share (#1) Market Share (#1) Packaged Pineapple Canned Mixed Fruit Canned and Carton Juices Market Share (#1) Market Share (#1) Tomato Sauce Spaghetti Sauce ▪ Del Monte is market le
Slide 24: Philippines
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® PHILIPPINES ▪ In 2Q, the Philippines domestic market reversed its FY2019 decline, with sales growing by 5% in peso terms and 9% in US dollar terms ▪ Retail sales grew by 2% in volume and 7% in peso sales value. Non-ret
Slide 25: Philippines - Culinary
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® PHILIPPINES - CULINARY Launch of Del Monte Condiments in Stand-Up- Del Monte Quick ‘n Easy ‘Mommadiskarte’ Pouches to recruit new users for the category Weekly Menu Youtube Campaign Aggressive in-store display and adve
Slide 26: Philippines - Beverage
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® PHILIPPINES - BEVERAGE Re-air of the 100% Fruitection TVC Broaden relevance of Del Monte Fit New Del Monte Pineapple campaign highlighting Del Monte ‘n Right Juice from just weight loss Juice Heart Smart campaign 100%
Slide 27: Philippines - Fruits
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® PHILIPPINES - FRUITS Consumption-drive of packaged Expand accessibility with the Christmas season behind Del pineapple, by levelling up core launch of lower-priced Stand-Up- Monte Fiesta Fruit Cocktail Filipino recipes
Slide 28: S&W Asia
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® S&W ASIA ▪ Consumers moving towards less processed and more natural food: S&W expanding sales of S&W Sweet 16 fresh pineapple ▪ E-commerce and digital are growing with North Asia having the largest share of E-commerce
Slide 29: S&W Asia
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® S&W ASIA ▪ Sales of the S&W branded business in Asia and the Middle East grew strongly by 27% in 2Q ▪ Mainly driven by higher sales of fresh pineapple in North Asia ▪ S&W packaged product also delivered higher volume a
Slide 30: S&W in Singapore
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® S&W IN SINGAPORE In-store display promotions at NTUC Finest stores Cross-promotion in newspaper of S&W Fruit & Chia and S&W Sweet 16 Fresh Pineapples 30
Slide 31: FieldFresh India
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® FIELDFRESH INDIA ▪ FieldFresh sales were up 6% in Rupee terms in 2Q due to higher Del Monte packaged product sales and FieldFresh-branded fresh sales ▪ DMPL’s share of loss in 2Q was US$0.5m, versus prior year quarter’
Slide 32: Sustainability
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® SUSTAINABILITY ▪ Del Monte Foods (DMFI) is working with Walmart on Project Gigaton which aims to avoid 1 billion metric tons (a gigaton) of GHG from the global value chain by 2030 ▪ DMFI has partnered with: ✓ Kellogg’s
Slide 33: Outlook
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® OUTLOOK ▪ Barring unforeseen circumstances, the DMPL Group is expected to remain profitable in FY2020 on a recurring basis (without one-offs). ▪ Major emphasis on responding to consumer trends through: ✓ Strengthening