Maple Leaf Foods Inc. · TSX:MFI
Maple Leaf Foods — Q1 2019 Earnings Presentation
13 slides from Maple Leaf Foods's earnings presentation, May 2, 2019
Slide 1: First Quarter 2019
First Quarter 2019 Advancing our vision to be the most sustainable protein company on earth MAPLE LEAF FOODS – Q1 2019 BUSINESS AND FINANCIAL REVIEW | MAY 2. 2019
Slide 2: Forward-looking Statements and non-IFRS Measures
Forward-looking Statements and non-IFRS Measures This presentation contains “forward-looking information” within the meaning of applicable securities law. These statements are based on current expectations, estimates, forecasts, and projections about the industries in which the Company operates, as
Slide 3: Top line growth, driven by acquisitions combined with in-quarter margin compression
Q1 2019 • Sales grew 11%, driven by acquisitions and enhanced sales mix Top line growth, driven by acquisitions combined • Strategic investments to fuel growth, in plant- with in-quarter margin based protein and new capacity for protein compression as we kits and meat pies invested in that growth •
Slide 4: Clear line-of-sight on in-quarter drivers impacting Adjusted EBITDA margin
Q1 2019 Acquisitions ~(70) bps Clear line-of-sight on Expected to be accretive in back half of 2019 in-quarter drivers Capacity start-up for protein kits & impacting Adjusted meat pies ~(50) bps EBITDA margin Normalized as we exited Q1 Investment in Plant-based protein SG&A ~(40) bps Continued suppo
Slide 5: African Swine Fever is an escalating global event with early effects rippling across agricultural industries
Market Landscape • No impact to human health African Swine Fever is an • Estimated 25-35% loss in Chinese hog escalating global event production with early effects rippling across agricultural • Dramatic increase in North American live industries hog prices • Hog production margins expected to impro
Slide 6: Results reflect top-line growth and investments
Financial Results Results reflect top-line growth and investments Q1 2019 Q1 2018 Sales ($ Millions) $907 $818 Adjusted EBITDA (%) 9.3% 10.1% Adjusted EPS $0.20 $0.29 Net debt (cash) ($ Millions) $384 $(6.9) MAPLE LEAF FOODS – Q1 2019 BUSINESS AND FINANCIAL REVIEW | MAY 2. 2019 6
Slide 7: Core business continues to build momentum underscored by favourable sales mix
Business Review • Continued growth in sustainable meats with expanding US retail footprint Core business continues to build momentum • Improved prepared meats commercial underscored by performance as food renovations gains favourable sales mix traction supporting structural margin expansion • Plant-
Slide 8: Building our healthy balance sheet to drive long-term growth
Investing in Growth • Strategic capital investment provides clear path to structural margin expansion Building our healthy balance sheet to drive • Refinancing provides access to $2 billion in long-term growth funding • Enhanced liquidity, flexibility and capacity for future growth • Committed to ma
Slide 9: Securing our leadership in the hyper-growth plant-based protein market
Investing in Growth Securing our leadership in the hyper-growth plant-based protein market MAPLE LEAF FOODS – Q1 2019 BUSINESS AND FINANCIAL REVIEW | MAY 2. 2019 9
Slide 10: Strategic growth platforms on track to deliver 14% - 16% structural margin target in 2022
Summary • Making strategic investments in growth Strategic growth • Accelerating leadership in sustainability platforms on track to deliver 14% - 16% • Executing on poultry strategy structural margin target in 2022 • Gaining momentum with renovated flagship brands • Securing and growing plant-based
Slide 11: Reconciliation of Non-IFRS Measures
Reconciliation of Non-IFRS Measures Adjusted Operating Earnings Q1 2019 Q1 2018 ($ millions) Net earnings 50.1 27.9 Income taxes 18.8 11.5 Earnings before income taxes(i) 68.9 39.4 Interest expense and other financing costs 7.4 1.7 Other expense (income) 2.1 2.9 Restructuring and other related costs
Slide 12: Reconciliation of Non-IFRS Measures
Reconciliation of Non-IFRS Measures Adjusted EBITDA Q1 2019 Q1 2018 ($ millions) Net earnings 50.1 27.9 Income taxes 18.8 11.5 Earnings before income taxes(i) 68.9 39.4 Interest expense and other financing costs 7.4 1.7 Items in other expense (income) not considered representative of ongoing 1.8 2.7
Slide 13: Reconciliation of Non-IFRS Measures
Reconciliation of Non-IFRS Measures Adjusted EPS Q1 2019 Q1 2018 ($ per share) Basic earnings per share 0.41 0.22 Restructuring and other related costs 0.02 0.01 Items included in other expense (income) not considered representative of 0.01 0.02 ongoing operations Change in the fair value of biologi