Nomad Foods Limited · NYSE:NOMD
Nomad Foods — Q4 2016 Earnings Presentation
35 slides from Nomad Foods's earnings presentation, Mar 30, 2017
Slide 1: Fourth Quarter 2016 Earnings Conference Call
Fourth Quarter 2016 Earnings Conference Call March 30, 2017
Slide 2: Disclaimer
Disclaimer BY READING THIS PRESENTATION, YOU ARE DEEMED TO HAVE READ AND ACCEPTED THE STATEMENT BELOW. This presentation has been prepared by Nomad Foods Limited. This presentation provides information about Nomad Foods Limited and its subsidiaries. Any references to Nomad shall mean Nomad Foods Lim
Slide 3: 2016 Highlights
2016 Highlights Stabilize Topline Trends ● 4Q16 like-for-like sales decline of 2.7% ● 5th consecutive quarter of sequential topline improvement ● “Must Win Battles” strategy is working with related sales inflecting positive 1.2% in 4Q16 ● Momentum into 2017 with 1Q like-for-like sales growth expecte
Slide 4: "Must Win Battles" Are Working
“Must Win Battles” Are Working What are “Must Win Battles”? ● A strategic cross-portfolio evaluation resulting in redirected resources to our most scalable sub-categories ● Key “Must Win Battles” criteria include market share, gross margin, growth potential and ROI ● A renewed focus on core products
Slide 5: "Must Win Battles" Success Stories
“Must Win Battles” Success Stories Fish Fingers Spinach Fish Fingers was one of the first “Must Win Battles” Spinach was activated in Germany, Austria and the launched across a number of markets Netherlands in 4Q16, resulting in a return to YoY growth 360 degree activation: return of highly effectiv
Slide 6: Our Strategic Vision
Our Strategic Vision Our Goal Operational Excellence Consolidate Frozen Catalyze organic topline growth through “Must Win Battles” Transform Nomad Continue to seek bolt-on while managing operating into a Leading Global acquisitions to complete our consolidation of the European expenses with a discip
Slide 7: 5 Consecutive Quarters of Sequential Improvement
5 Consecutive Quarters of Sequential Improvement Pre-Nomad Strategy New Strategic Direction Strategic Food of Life Pan-European Ad Campaign Launch Review Revenue Mgmt. Cost Review New NPD Strategy Launches Promo Changes Packaging Launch Annual Annual New Negotiations Negotiations Advertising Refresh
Slide 8: 4Q16 Revenue Bridge
4Q16 Revenue Bridge Like-for-Like Revenue: (2.7%) 1) 1) For comparative purposes, Nomad Foods is also presenting Pro Forma As Adjusted financial information for the three months ended December 31, 2015. Pro Forma As Adjusted financial information for the three months ended December 31, 2015 includes
Slide 9: 4Q16 Gross Profit Bridge
4Q16 Gross Profit Bridge Gross Margin: +1.5% 26.5% 28.0% Like-for-Like Gross Profit: + €3.7m 1) 1) For comparative purposes, Nomad Foods is also presenting Pro Forma As Adjusted financial information for the three months ended December 31, 2015. Pro Forma As Adjusted financial information for the th
Slide 10: 4Q16 Operating Performance
4Q16 Operating Performance 1) €m, except per share data 4Q 16 4Q 15 Delta Revenue 485.2 520.8 -35.6 Gross Profit 135.9 137.9 -2.0 Gross profit margin (%) 28.0% 26.5% 1.5% Advertising & Promotions -37.3 -26.9 -10.4 Advertising &Promotions (% Revenue) 7.7% 5.2% 2.5% Indirects -49.8 -52.3 2.5 Indirects
Slide 11: 2016 Revenue Bridge
2016 Revenue Bridge Like-for-Like Revenue: (4.0%) 1) 1) For comparative purposes, Nomad Foods is also presenting Pro Forma As Adjusted financial information for the twelve months ended December 31, 2015 for the combined results of Nomad Foods, the Iglo Group and the Findus Group. Pro Forma As Adjust
Slide 12: 2016 Gross Profit Bridge
2016 Gross Profit Bridge Gross Margin: +0.1% 29.5% Like-for-Like Gross Profit: (€18.7m) 29.6% 1) 2) 2) 1) For comparative purposes, Nomad Foods is also presenting Pro Forma As Adjusted financial information for the twelve months ended December 31, 2015 for the combined results of Nomad Foods, the Ig
Slide 13: 2016 Operating Performance
2016 Operating Performance 1) €m, except per share data 2016 2015 Delta Revenue 1,927.7 2,051.7 -124.0 Gross Profit 571.0 604.7 -33.7 Gross profit margin (%) 29.6% 29.5% 0.1% Advertising & Promotions -113.7 -120.1 6.4 Advertising &Promotions (% Revenue) 5.9% 5.9% 0.0% Indirects -183.5 -204.0 20.5 In
Slide 14: Key Cash Flow Metrics
Key Cash Flow Metrics (1) €m 2016 2015 Delta As Adjusted EBITDA 324.9 331.7 (6.8) Loss on disposal of property, plant & equipment 0.7 0.1 0.6 Working Capital movement 33.9 (26.0) 59.9 Pensions & Other Provisions movements (3.3) (6.8) 3.5 Capital Expenditure (42.4) (53.4) 11.0 As Adjusted Operating C
Slide 15: 2017 Guidance
2017 Guidance Net Sales ● 1Q and 2017 Like-for-like sales growth to be positive ● 1Q reported sales growth negatively impacted 400 bps from foreign currency translation and leap year comparison Gross Profit and EBITDA ● 2017 gross profit ahead of 2016 ● 2017 underlying EBITDA growth to be offset by
Slide 16: 2016 Highlights
2016 Highlights Stabilize Topline Trends ● 4Q16 like-for-like sales decline of 2.7% ● 5th consecutive quarter of sequential topline improvement ● “Must Win Battles” strategy is working with related sales inflecting positive 1.2% in 4Q16 ● Momentum into 2017 with 1Q like-for-like sales growth expecte
Slide 17: Questions?
Nomad Foods Questions? 17
Slide 18: Appendix
Nomad Foods Appendix 18
Slide 19: Contents
Contents The following tables have been included to allow users to reconcile non-IFRS financial information as well as As Adjusted and Pro Forma As Adjusted financial information included within this presentation to reported IFRS financial information. 1. Definitions of all key terms and P&L measure
Slide 20: Definitions of all key terms and P&L measures
1) Definitions of all key terms and P&L measures referred to in this presentation Non-IFRS financial measures should not be considered as substitutes for, or superior to, measures of financial performance prepared in accordance with IFRS. They are limited in value because they exclude charges that h
Slide 21: Constant Currency reconciliations
2) Constant Currency reconciliations for the three months ended December 31, 2015 and December 31, 2016 and the 12 months ended December 31, 2015 and December 31, 2016 Three months ended December 31, 2015 Three months ended December 31, 2016 Variance As Adjusted at As Adjusted at adjusted for LFL Co
Slide 22: Reconciliation of reported to Pro Forma three months 2015
3) Reconciliation of reported to Pro Forma As Adjusted financial information for the three months ended December 31, 2015 (a) Findus Group results for the month ended October 31, 2015 have been constructed using unaudited carve out financial information prepared by the Seller, adjusted for informati
Slide 23: Reconciliation of reported to Pro Forma three months 2015
3) Reconciliation of reported to Pro Forma As Adjusted financial information for the three months ended December 31, 2015 (a) Includes costs incurred in relation to completed and potential acquisitions. (b) Adjustment to eliminate long term management incentive scheme costs from prior ownership. (c)
Slide 24: Reconciliation of reported to Pro Forma twelve months 2015
4) Reconciliation of reported to Pro Forma As Adjusted financial information for the twelve months ended December 31, 2015 (a) Findus Group unaudited results for the ten months ended October 31, 2015 have been derived from the audited carve out accounts for the year to 30 September 2015, unaudited c
Slide 25: Reconciliation of reported to Pro Forma twelve months 2015
4) Reconciliation of reported to Pro Forma As Adjusted financial information for the twelve months ended December 31, 2015 (a) Includes costs incurred in relation to completed and potential acquisitions. (b) Elimination of charges at the Iglo level related to the purchase price exercise on the acqui
Slide 26: Reconciliation of reported to three months 2016
5) Reconciliation of reported to As Adjusted financial information for the three months ended December 31, 2016 (a) Adjustment to add back share based payment charge. (b) Adjustment to add back exceptional items which management believes are non-recurring and do not have a continuing impact. (c) Adj
Slide 27: Reconciliation of reported to three months 2016
5) Reconciliation of reported to As Adjusted financial information for the three months ended December 31, 2016 As reported for the three months ended December 31, € in millions 2016 Profit before tax 4.0 Net financing costs 22.2 Depreciation 10.5 Amortization 2.8 EBITDA 39.5 Exceptional items: Tran
Slide 28: Reconciliation of reported to twelve months 2016
6) Reconciliation of reported to As Adjusted financial information for the twelve months ended December 31, 2016 As reported for the As Adjusted for twelve months the twelve months ended December ended December € in millions, except per share data 31, 2016 Adjustments 31, 2016 Revenue 1,927.7 - 1,92
Slide 29: Reconciliation of reported to twelve months 2016
6) Reconciliation of reported to As Adjusted financial information for the twelve months ended December 31, 2016 As reported for the twelve months ended December 31, € in millions 2016 Profit before tax 76.0 Net financing costs 62.1 Depreciation 43.3 Amortization 7.8 EBITDA 189.2 Exceptional items:
Slide 30: Reconciliation of operating cash flow to As Adjusted Operating Cash flow
7) Reconciliation of reported net cash flows from operating activities to As Adjusted Operating Cash flow (excl. tax) for the year ended December 31, 2016 As reported for the year ended December 31, € in millions (unaudited) 2016 Net cash flows from operating activities 282.1 Add back: Tax paid 24.9
Slide 31: Reconciliation of operating cash flows for year ended December 31, 2015
8) Reconciliation of reported net cash flows from operating activities to Pro Forma As Adjusted Operating Cash flow (excl. tax), Pro Forma As Adjusted Operating Cash flow, Pro Forma As Adjusted Cash flow available for Debt Servicing, and, Pro Forma As Adjusted Cash flow available for Debt Repayment
Slide 32: Reconciliation of cash flow detail line items 2016
9) Reconciliation of reported cash flow detail line items to As Adjusted financial information for the year ended December 31, 2016 As reported for the year ended December € in millions (unaudited) 31, 2016 Increase in inventories (18.1) Increase in trade and other receivables (8.8) Increase in trad
Slide 33: Reconciliation of cash flow detail line items to Pro Forma 2015
10) Reconciliation of reported cash flow detail line items to Pro Forma As Adjusted financial information for the year ended December 31, 2015 (a) Findus Group unaudited financial information has been derived from management accounts and the Findus Group Consolidated Carve-out Financial Statements f
Slide 34: Reconciliation from Findus Sverige AB Carve-out Financial Statements
11) Reconciliation from reported Findus Sverige AB Consolidated Carve-out Financial Statements for the year ended September 30, 2015, to financial information for other periods used elsewhere in this appendix Nomad Foods is presenting As reported Findus financial information within this appendix. Th
Slide 35: Reconciliation of Net Debt to As Adjusted Net Leverage
12) Reconciliation of Net Debt to calculate As Adjusted Net Leverage for the twelve month periods ending December 31, 2016 and 2015 (a) Loans and borrowings excludes €12.4 million (2015: €17.3 million) deferred borrowings costs (b) As Adjusted Net leverage is calculated as Net Debt divisible by As A