Haypp Group Ab · OMXSTO:HAYPP
Haypp Group Ab — LD Micro Conference (April 2024)
22 slides from Haypp Group Ab's conference presentation, Apr 9, 2024
Slide 1: Haypp Group - LD Micro Conference
Haypp Group - LD Micro Conference Gavin O’Dowd, CEO Peter Deli, CFO April 9, 2024 1 Strictly private and confidential
Slide 2: Why we exist – inspiring healthier enjoyment for millions
Why we exist – inspiring healthier enjoyment for millions 2
Slide 3: Haypp Group at a glance
Haypp Group at a glance • The largest retailer of Nicotine Pouches (NPs) in the • Founded 14 years ago as e-commerce site with a world. NPs account for c. 56% of Group volume and focus on snus in Sweden. 6 years ago emphasis grew 41% y/y in 2023. shifted to NPs and started to expand outside Sweden,
Slide 4: Focused on healthier enjoyment products
Focused on healthier enjoyment products Significantly lower levels of risk from modern nicotine alternatives to cigarettes Food retail and convenience stores Typical POS Food retail, convenience stores and online Pharmacies Conventional Other tobacco Heat not Burn Nicotine vaping products Low toxica
Slide 5: Global market transformation
Global market transformation Strong market dynamics… …resulting in attractive expected growth for nicotine pouches Global market for nicotine pouches and snus, EUR bn CAGR 2023–28 Strong demand for lower risk products CAGR +27% Legislation favours modern reduced-risk nicotine products +35% 15 CAGR +
Slide 6: Superior position in the value chain
Superior position in the value chain CONSUMERS SUPPLIERS E-commerce & Distribution centres Media outreach DATA Customer insights CUSTOMER INSIGHTS 6
Slide 7: Top SEO positions create meaningful competitive moat
Top SEO positions create meaningful competitive moat 1 Google wants to optimise the customer experience… 2 …and Haypp Group dominates search word visibility… Site performance Unique content Conversion rates Returning customers Haypp Group 3 …generating high share of free traffic… 4 …resulting in low
Slide 8: Loyalty fuels consumer base growth
Loyalty fuels consumer base growth Continuously growing consumer base… increasing AOV and repurchase rates as we retain consumers Attract new consumers Make them come back Number of consumers / quarter +48% +11% Increase in average 500,000 Increase in average AOV order frequency from 450,000 from 1s
Slide 9: Haypp Group presence across Europe and USA
Haypp Group presence across Europe and USA TOTAL MARKET SHARE NICOTINE ~30% ~18% ~7% ~6% ~3% POUCHES ONLINE ~85% ~80% ~50% ~60% ~55% MARKET SHARE ORAL NICOTINE Source: Company information, Arthur D. Little Note: 1) Based on number of sold cans; 2) DACH Germany, Austria, Switzerland 9
Slide 10: Haypp Group Media eco-system
Haypp Group Media eco-system Activation tools (examples) On-site activation with +3M sessions per month Awareness BRAND PAGES ON SITE COMMUNICATION SEARCH BAR VISIBILITY SPONSORED ~65% Richest awareness offer with broad reach LISTING of all NP trials in SE created by Haypp MAIL COMMUNICATION CHECK-O
Slide 11: Scale-driven advantages enable impactful insights offering
Scale-driven advantages enable impactful insights offering Proprietary datasets Utilisation of Machine Learning Consumer research Product Demographics specifications Consumers Transaction / Psychographics Markets behaviours and behaviour Brands DATA + Critical Q U A N T I TAT I V E Mass HAYPP INSIGH
Slide 12: Haypp Group is the most valuable partnership
Haypp Group is the most valuable partnership Benefits of working with Haypp Group for brand owners ~15% • No returns • No field force • No fridges/gantries Aggregated cost saving by working with Haypp Group • No printed point of sale material • 1 point of delivery – lower distribution cost • 100% co
Slide 13: Upholding society’s expectations
Upholding society’s expectations 18+ 21+ 100% • We are a credible player due to our history of responsible behavior. • Our global leadership in setting product standards age verified transactions enhances our credibility. • We are always involved in relevant changes. Haypp Group works with the best
Slide 14: 2023 – Another year of strong NP performance
2023 – Another year of strong NP performance Quarterly Nicotine Pouch volume & % chg y/y Quarterly Nicotine Pouch % of Group volume 100% 60% 90% Over 50% of volume from NP NP Vol % chg y/y 50% 80% 70% 40% 60% 50% 30% 40% 20% 30% 20% 10% 10% 0% 0% Q1 20 Q3 20 Q1 21 Q3 21 Q1 22 Q3 22 Q1 23 Q3 23 Q1 19
Slide 15: Key financial highlights
Key financial highlights Strong growth... …scale driving increased product margin …driving increasing profitability SEK mn SEK mn SEK mn 9.7% 13.0% 11.0% 12.6% 12.7% -0,8% 2,2% 1,8% 2,3% 2,5% 3.166 402 78,2 41% 44% 2.599 329 58,5 2.267 250 1.729 225 41,5 38,2 802 94 -6,7 2019 2020 2021 2022 2023 201
Slide 16: Sustained momentum across Core & Growth segments
Sustained momentum across Core & Growth segments Rapid increase in Growth segment contribution… …with quickly improving profitability Net sales (SEK mn) Adj. EBITDA margin 3500 10% 0% 9% -2% 3000 61% Growth segment CAGR 758 8% -4% 2500 7% -6% 454 289 6% -8% 2000 Growth 77% Core 5% -10% 236 1500 Cont
Slide 17: Current growth rates support SEK 5bn target for 2025
Current growth rates support SEK 5bn target for 2025 Rapid net sales growth in Growth markets …will bring us to the 5bn target Net sales (SEK mn) Net sales (SEK bn) +21% 3166 ~4,8-5,1 2617 758 +26% +67% Growth 454 ~3,8-4,1 3,2 +68% 2,6 +68% +12% 2,3 Core 2407 0,5 2145 1,7 0,3 +68% 0,3 +12% 0,8 2,1 +
Slide 18: …and further improve adj. EBITDA in our existing footprint
…and further improve adj. EBITDA in our existing footprint Core markets Growth markets 9-11% 4,0 10 10 5-7% 4,0 8% 8% 3,0 8 3,0 0 2,0 6 -9% 2,0 -10 1,0 2,1 2,3 4 -16% 1,0 0,0 2 -20 0,5 0,7 0,0 2022 2023 2025 2022 2023 2025 Adj. EBITDA % Net sales Total current business 10 10,0 7-9% 8,0 8 6,0 6 4% 4,
Slide 19: Breaking down the 2025 profit margin outlook
Breaking down the 2025 profit margin outlook 1-2% 1-2% 7-9% 5-7% 4-6% Current business Depreciation Current business Investment into new Reported (Core + Growth) (Core + Growth) Emerging division Adj. EBIT adj EBITDA adj EBIT 19
Slide 20: Underpinning Haypp Group’s success
Underpinning Haypp Group’s success Performance Operating model Technology and processes People and culture Inspiring healthier enjoyment for millions 20
Slide 21: Additional useful information available on hayppgroup.com/investor-relations/
Additional useful information available on hayppgroup.com/investor-relations/ • Capital Markets Day presentation with webcast providing a detailed discussion of the Group’s business by the management team • Excel financial data download with annual and quarterly financial and KPI information, update
Slide 22: Inspiring healthier enjoyment for millions
Inspiring healthier enjoyment for millions