Hostess Brands — Merger or Acquisition (December 2019)
12 slides from Hostess Brands's merger presentation, Dec 2, 2019
Slide 1: Voortman Acquisition
Voortman Acquisition December 2, 2019
Slide 2: Forward Looking Statements
Forward Looking Statements This investor presentation contains statements reflecting our views about the future performance of Hostess Brands, Inc. and its subsidiaries (referred to as “Hostess Brands” or the “Company”) that constitute “forward-looking statements” that involve substantial risks and
Slide 3: Leveraging Hostess Core Competencies
Leveraging Hostess Core Competencies ▪ Provides entry into attractive, adjacent wafer and sugar-free cookie Expands categories with market-leading positions and better-for-you characteristics Hostess’ Snacking ▪ Fastest growing independent sweet snacking brand of scale in North America Portfolio ▪ #
Slide 4: Aligns with Hostess' Existing Pillars for Growth
Aligns with Hostess’ Existing Pillars for Growth ✓ Grow✓ through Improve✓ through Cultivate✓ Talent Leverage✓ Strong Grow the Core Innovation Agility & Efficiency & Capabilities Cash Flow ▪ Adds an ▪ Strong, ▪ Leverages ▪ Addition of ▪ Efficient use adjacent incremental Hostess’ talent and of capita
Slide 5: Meaningfully accretive with strong growth opportunities
Meaningfully accretive with strong growth opportunities • Hostess will acquire Voortman, a leading manufacturer of wafers as well as sugar-free and specialty cookies, for CAD $425 million (~USD $320 million) in cash, subject to a customary working capital adjustment Summary • Represents a post-syner
Slide 6: Began in 1951 in Ontario, Canada
Began in 1951 in Ontario, Canada Breakdown of 2018 Revenue Product Overview Geographic Overview Sugar Specialty Other Free Cookies Canada 5% 39% 22% 21% Crème Wafers 39% U.S. 74% 6
Slide 7: Dominant market share in both Sugar Free Cookies and Wafers
Dominant market share in both Sugar Free Cookies and Wafers #1 Market Share 18.2% in Wafer and Sugar Free $118 1.40% 17.7% Cookie Segments and Growing 1.36% $111 1. $101 27% 2017 2018 2019 Source: Nielsen, Total Nielsen Universe for Voortman within the U.S. Cookie Category. 7 Point of Sale and Marke
Slide 8: Voortman is part of large growing addressable snacking market
Snacking Market Growth1 Voortman is part of +$30B large growing addressable snacking market $180B $125B $150B 2017 2019E 2022E Consumer Preference for Types of Snacks2 Consumer tailwinds Sweet Snacks 74% on sweetness and Better-for-You 69% better for you Late-Night 68% Most valued characteristics at
Slide 9: Potential to leverage Hostess' broad channel distribution to amplify Voortman growth
Potential to leverage Hostess’ broad channel distribution to amplify Voortman growth Food C-Store Drug US xAOC 75% 3% Source: Nielsen, Total Nielsen Universe % ACV for the 52 weeks ending 11/2/19. 9
Slide 10: Merchandising Execution at Scale
Voortman Historical Hostess Merchandising Merchandising Execution at Scale Ability to expand merchandising efficiently at scale Seasonal programming correlates well with how Hostess goes to market to drive incremental sales 10
Slide 11: Well-invested and efficient manufacturing
Well-invested and New Product efficient manufacturing Forms facility ~250k Sq. footage 175K production, 75k warehouse 11 lines 7 cookie and 3 wafer lines currently, with an additional wafer line currently being commissioned 28 Truck Bays 11
Slide 12: Diversifies and Expands Product Offerings and Manufacturing Capabilities
Diversifies and Expands Product Offerings and Manufacturing 1 Capabilities in Attractive, Adjacent Category Leverages Hostess’ Broad Customer Reach and 2 Lean and Agile Business Model 3 Significant Cost Synergy Opportunities 4 Compelling Financial Benefits 12
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