Sprouts Farmers Market, Inc. · NASDAQ:SFM
Sprouts Farmers Market — Investor Presentation (August 2019)
29 slides from Sprouts Farmers Market's investor presentation, Aug 23, 2019
Slide 1: Investor Deck August '19
Investor Deck August ‘19 Exhibit 99.1
Slide 2: Forward-Looking Statements
Forward-Looking Statements: Certain statements in this presentation are forward-looking as defined in the Private Securities Litigation Reform Act of 1995. Any statements contained herein (including, but not limited to, statements to the effect that Sprouts Farmers Market, Inc. (the “Company”) or it
Slide 3: Welcome to Sprouts Farmers Market…
Welcome to Sprouts Farmers Market…
Slide 4: A long history of fresh foods at great prices
A long history of fresh foods at great prices 17 PLUS YEARS OF EXPERIENCE HAVE MADE US THE DESTINATION KNOWN FOR “HEALTHY LIVING FOR LESS”! 2002 In 2002, “Healthy Living for Less” was born when Stan and Shon Boney, Henry’s son and grandson, opened the first Sprouts Farmers Market in Chandler, Arizon
Slide 5: Our Brand
Our Brand Brand Heritage Our roots trace back to 1943, when Henry Boney opened a simple fruit stand in Southern California. From those humble beginnings, our founding family built on its passion to make healthy food affordable for everyone . Health And Wellness From affordable organic produce to nat
Slide 6: A Grocery Shopping Experience that Makes Healthy Living Easy & Affordable
A Grocery Shopping Experience that Makes Healthy Living Easy & Affordable Health Value Selection Engagement SELECTION VALUE KNOWLEDGEABLE SERVICE & ENGAGEMENT HEALTH
Slide 7: A Healthy Grocery Store that Flips the Conventional Model
A Healthy Grocery Store that Flips the Conventional Model PRODUCE surrounded by a complete grocery offering Promote VALUE everyday DIFFERENTIATED selection of high-quality, healthy foods Farmers market-inspired OPEN STORE LAYOUT with low profile displays CONVENIENT Small-box Friendly, ENGAGED CUSTOM
Slide 8: Sprouts' Value Proposition Attracts a Much Broader Customer Base
Sprouts’ Value Proposition Attracts a Customer Base that is Much Broader than that of Traditional Health Food or Specialty Stores HEALTH REGIMENTED HEALTH ENTHUSIAST Segment Description HEALTH REGIMENTED follow a strict diet/regiment because they have to (medical reasons) or want to (weight manageme
Slide 9: Continued Top Line Growth in a Dynamic Marketplace
Continued Top Line Growth in a Dynamic Marketplace ’14 – ’18 CAGR: 15% ($ in mm) Net Sales
Slide 10: Expanding our Footprint
Expanding our Footprint Q2: Louisiana and New Jersey open their doors to Sprouts guests Next up…Virginia Demographics allow for deep penetration in markets Model works well in densely populated, urban areas as well as smaller metropolitan markets Successful in “natural / lifestyle” markets and more
Slide 11: Private Label Differentiation and Loyalty Driver
Private Label Differentiation and Loyalty Driver Strong Private Label Results 11 Sales growth north of 25%, almost quadrupling since 2013 Accounts for nearly 14% of revenue, outpaces overall company net sales and comp growth Continually introducing new staple, trending and unique products , along wi
Slide 12: Extending Our Brand Experience Digitally
Extending Our Brand Experience Digitally Expanded grocery delivery offering to more than 270 stores and expanded grocery pickup pilot to more states. Educated millions of guests with healthy living content on a new website and engaged with 2.35 MM+ email subscribers. Introduced new tools to save and
Slide 13: Environment: Positive Impact on Our Planet
ENVIRONMENT: We are committed to creating a positive impact on our planet by engaging our team members, suppliers and strategic partners to implement programs that eliminate waste, fight hunger, reduce greenhouse gas emissions and save energy. SOURCING - 98% of Sprouts fresh and frozen seafood sourc
Slide 14: Sourcing: 90% of Our 20,000+ Products are Natural or Organic
SOURCING: 90% of our More than 20,000 Products are Natural or Organic SOURCING - 98% of Sprouts fresh and frozen seafood sourced responsibly - Ranked #8 in the nation by Greenpeace for sustainable seafood sourcing - Surveyed more than 230 suppliers for sustainable sourcing practices - 20% of Sprouts
Slide 15: Investing in Our Team Members
INVESTING IN OUR TEAM MEMBERS: Cultivating a Dedicated Team rooted in Sprouts Culture All numbers stated are based on 2018 Annual Stats 15% off for Team Members Every Day
Slide 16: Community: Our Commitment to Helping Others
COMMUNITY: Our Commitment to Helping others in our Community Extends beyond our Stores
Slide 17: Business & Financial Performance
Business & Financial Performance
Slide 18: Powerful Growth Business – Results Driven
Powerful Growth Business – Results Driven 6% Natural and Organic Sector Growth1 One of the Best White Space Opportunities in Retail Healthy Unit Growth Rate 1 SPINS LLC industry projections for natural and organic food and supplement sales growth through 2020 Compelling Store-Level Economics Strong
Slide 19: History of Solid Operating Performance
NET SALES ADJUSTED EBITDA (1) ROIC (3) NET CASH PROVIDED by OPERATIONS History of Solid Operating Performance See the Appendix to this presentation for a reconciliation of EBITDA and adjusted EBTIDA to net income. For 2016-2017, adjustments to EBITDA were immaterial; thus only EBITDA is presented. 2
Slide 20: A History of Solid Earnings Growth
A History of Solid Earnings Growth 1 See the Appendix to this presentation for a reconciliation of adjusted net income to net income. For 2016, adjustments to net income were immaterial, thus only net income is presented. 2 2015 is presented on a 53-week basis. 3 See the Appendix to this presentatio
Slide 21: Long Runway of Organic Growth
Long Runway of Organic Growth Store Count
Slide 22: Capex Focused on Unit Growth, Sales Initiatives & Infrastructure
Capex Focused on Unit Growth, Sales Initiatives & Infrastructure Capex Spend ($ in mm) Note: Cap Ex is net of landlord reimbursements
Slide 23: Compelling New Store Economics
Compelling New Store Economics Average square foot store size Average Net Cash Investment1 First Year Sales Initial Sales Growth over 3 to 4 years ¹ Includes store build-out (net of contributions from landlords), inventory (net of payables), new store development cost and cash pre-opening expenses.
Slide 24: Sprouts is an Everyday Healthy Grocery Store
Sprouts is an Everyday Healthy Grocery Store Well- Positioned to Meet the Needs of Today’s Consumer Authentic Fresh, Natural & Organic Food Offering at Great Value Fastest Growing Segment of the U.S. Supermarket Industry Robust New Store Growth Opportunity Supported by Broad Demographic Appeal Compe
Slide 25: Appendix: Supplemental Materials
Appendix: Supplemental Materials
Slide 26: Management Team Rooted in Grocery & Retail Expertise
Management Team Rooted in Grocery & Retail Expertise Jack Sinclair Chief Executive Officer since 2019 99 Cents Only Stores, CEO 2018-2019, Chief Merchandising Officer 2015-2018 Walmart, Inc., EVP U.S. Grocery Division 2007-2015 Hain Celestial, Board Member 2017-2019 Safeway PLC, 1990-2004 Lawrence (
Slide 27: Non-GAAP Measure Reconciliation
SPROUTS FARMERS MARKET, INC. AND SUBSIDIARIES NON-GAAP MEASURE RECONCILIATION (UNAUDITED) (IN THOUSANDS) The following table shows a reconciliation of EBITDA and adjusted EBITDA to net income, as well as a reconciliation of net income and diluted earnings per share to adjusted net income and adjuste
Slide 28: Appendix
Appendix Income tax provision (benefit) includes approximately $12 million (or $0.10 per diluted share) in the fifty-two weeks ended December 30, 2018 and $10 million (or $0.08 per diluted share) in the fifty-two weeks ended December 31, 2017, in excess federal and state tax benefits for stock-based
Slide 29: Appendix: ROIC Reconciliation
Appendix The following table shows a reconciliation of ROIC to net income for the Company’s 2015, 2016, 2017, and 2018 fiscal years. SPROUTS FARMERS MARKET, INC. AND SUBSIDIARIES NON-GAAP MEASURE RECONCILIATION (UNAUDITED) (IN THOUSANDS) (1)Fiscal 2015 includes 53 weeks (2) Net income amounts repres
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