Slide 1: ConAgra Foods CAGNY 2009
Slide 2: Note on Forward-Looking Statements
This presentation contains forward-looking statements. These statements are based on management's current views and assumptions of future events and financial performance and are subject to uncertainty and changes in circumstances. The company undertakes no responsibility for updating these statemen
Slide 3: Total FY2008 Revenue: $11.6 Billion
Total FY2008 Revenue: $11.6 Billion Consumer Foods $7.5 Billion Commercial Foods $4.1 Billion
Slide 4: The Next Phase - Refining Our Focus
The Next Phase - Refining Our Focus Stronger Brand Foundation Financial Priorities and Outlook
Slide 5: Strengthening the Foundation: Past
Strengthening the Foundation Past: Pre - 2006 Holding Company Independent operating companies Deal driven All brands must grow
Slide 6: Strengthening the Foundation: Recent 2006-2008
Strengthening the Foundation Culture Wiring Infrastructure Cost structure Innovation pipeline Marketing fundamentals Divestitures Recent: 2006 - 2008 Fundamentals
Slide 7: Future: Strong Operating Company Focus
Future: Strong Operating Company Focus 2009 & Beyond: Operating Excellence 5 strategic business priorities Innovation: Fewer, Bigger, Better Insights driven marketing & selling Supply chain excellence
Slide 8: Developing Our Strategic Priorities
Developing Our Strategic Priorities More granular analysis of our portfolio Detailed evaluation of market growth opportunities Creates direction for resource priorities Capital Innovation A&P / G&A investments
Slide 9: Strategic Priorities
Strategic Priorities Sustainable, Profitable Growth Convenient Meals Potatoes Snacks Meal Enhancers Specialty 1 2 3 4 5
Slide 10: Convenient Meals
Convenient Meals Health & Wellness Restaurant Quality Value Kids
Slide 11: Healthy Choice Cafe Steamers
Healthy Choice Cafe Steamers $140 million+ annualized sales Industry-wide: The best selling new food / beverage product in the first half of 2008!* *Source: IRI
Slide 12: Healthy Choice Asian-Inspired Cafe Steamers
Followed By...Healthy Choice Asian-Inspired Cafe Steamers Objective: Extend platform & taste profiles Highly incremental Asian SKUs hold #1, #2 position among CAG Steamer products
Slide 13: Healthy Choice Fresh Mixers
Healthy Choice Fresh Mixers Steaming platform brought to shelf stable New day part: portable lunch Estimated to be 50% incremental to the category
Slide 14: Blank for Commercials
BLANK FOR COMMERCIALS
Slide 15: Healthy Choice Fresh Mixers
Healthy Choice Fresh Mixers altoy, — la; Sy AO
Slide 16: Consumer Trends and Frozen Foods Transformation
Consumer Trend Restaurant quality at home Transformation New cuisine, New occasion Innovation: Al Dentes, Sautes Consumer Trend Value is more important than ever Transformation Transforming $1 meals Maintaining key opening price points Consumer Trend Holistic health through positive nutrition Transf
Slide 17: Healthy Choice Market Realities
Strong brand awareness Today's Healthy Choice skews towards older consumers and dieters Significant opportunity to enhance nutrition and improve taste and packaging Tomorrow's Healthy Choice platform meets consumer lifestyle demands for: - - Restaurant quality - Lighter entrees - - Health & wellness
Slide 18: Healthy Choice Packaging
Healthy Choice Packaging Old New
Slide 19: Healthy Choice Renovation
Healthy Choice Renovation Branding • Taste • Quality • Positive Nutrition Complete Meals Total renovation (Whole Grain-Fiber-Protein) Improved taste & quality Core Entrees Total renovation (Whole Grain-Fiber) Improved taste & quality Steamers Asian expansion Outstanding momentum New All Natural Entr
Slide 20: Healthy Choice All Natural Meatless Entrees
Healthy Choice All Natural Proactive Nutrition. NEW! Contemporary Taste. Sweet Asian Potstickers Pumpkin Squash Ravioli Portabella Spinach Parmesan Tomato Basil Penne Mediterranean Pasta Portabella Marsala Pasta Whole Grains Antioxidants Vitamins ACE Lycopene Real Food. All Natural. No Additives. No
Slide 21: Healthy Choice Marketing
Healthy Choice Marketing Celebrity spokesperson New target 360° campaign Begins March 30 Coming Soon ....Stay tuned!
Slide 22: Marie Callender's
Marie Callender's Marie Callender's great tasting, home-style meals have grown at a 13% CAGR since FY2004 Restaurant fresh, restaurant delicious! New Marie Callender's items have significant upside potential Market Realities
Slide 23: Marie Callender's Al Dente
Very strong consumer demand for high quality pasta offerings Marie Callender's Al Dente takes frozen food to an entirely different level Tray-in-tray steaming means exceptional pasta, crisp vegetables, tender meats CAG's highest scoring product ever in consumer in-home testing Exceeds consumer expec
Slide 24: Al Dente Steamers Consumer Scores
Al Dente consumer scores even higher than Healthy Choice Cafe Steamers! Al Dente Steamers Purchase Intent Liking Value Uniqueness Better than Expected
Slide 25: Marie Callender's Sautes
Marie Callender's Sautes Restaurant quality Chef inspired Meals for 2 "Cook" involvement
Slide 26: Banquet Consumer Feedback
"I feel good when I give my family Banquet because they are getting a full balanced meal, and they are nourished to perform well." "THANK YOU so much for the good hot meal for less. Please, please, please don't raise the prices. They are perfect!" Share leader in SS economy segment Highest penetrati
Slide 27: Banquet Renovation: It's All About Value
Banquet Renovation It's all about value $1 dinners = Key opening price point Strong brand loyalty Scale enables efficiencies Banquet margins ranged significantly across SKUs Market Realities
Slide 28: Banquet Renovation
Banquet Renovation "Working backward" from $1 price point objective No quality compromise SKU elimination and right-sizing New items
Slide 29: Banquet Renovation: Win-Win-Win
Banquet Renovation: Win - Win - Win Consumer gets $1 dinner Customer traffic grows ConAgra Foods improves margins
Slide 30: Potatoes
Potatoes LamiMleston a Eid
Slide 31: Lamb Weston Foodservice and Retail
Foodservice Foodservice Domestic International Retail Annual Sales $1.5 billion $400 million $200 million Key Customers Market Position #1 in North America #2 Globally #1 in North America #2 Globally Lamb Weston strong in Private Label Lamb Weston Gold standard in customer service & innovation World
Slide 32: Lamb Weston: Diverse Offerings Help Customers Grow
Lamb Weston: Diverse Offerings Help Customers Grow
Slide 33: Lamb Weston Plants
13 plants 7.5 billion pounds processed annually! Lamb Weston
Slide 34: Lamb Weston Net Sales
Lamb Weston Net Sales FY2000 FY2001 FY2002 FY2003 FY2004 FY2005 FY2006 FY2007 FY2008 FY2009 est East 1200 1200 1300 1300 1400 1500 1600 1700 2000 2250 (in Millions)
Slide 35: Alexia: Growing a Premium All-Natural Brand
Alexia: Growing a Premium All-Natural Brand
Slide 36: Snacks
Snacks
Slide 37: Snacks
Snacks $1.1 billion annual revenue in warehouse snacks Popcorn, meat sticks and seeds Private label fruit snacks and grain bars Snacking a core and growing part of today's lifestyles Snacks provides strong platform to expand healthy, better-for-you offerings
Slide 38: Orville Redenbacher's: Healthier Snacking
Orville Redenbacher's: Healthier Snacking
Slide 39: Deliberate Mix Shift Popcorn Business
Deliberate Mix Shift Popcorn Business
Slide 40: Blank for Commercials
BLANK FOR COMMERCIALS
Slide 41: Private Label: Significant Snacks Business
Private Label: Significant Snacks Business Very important categories to key customers A high-potential, growing part of ConAgra Foods' snacks portfolio Solid margins given no marketing investment is required
Slide 42: Breakthrough Snack Innovation
Breakthrough Snack Innovation Premium, great taste, natural better-for-you appeal
Slide 43: Exceptional Taste and Textures
Exceptional taste and textures Snacking innovation that delivers exceptional taste and a big crunch Made using only the finest whole, thick cut slices of real potatoes or onions Never processed, extruded, pressed or formed More healthful than regular chips Made from 100% real vegetables Natural seas
Slide 44: Slim Jim
Aw Slim Jim
Slide 45: Blank for Commercials
BLANK FOR COMMERCIALS
Slide 46: Strengthening the Foundation: Marketing Emphasis
Strengthening the Foundation: Marketing Emphasis Culture Wiring Infrastructure Cost structure Innovation pipeline Marketing fundamentals Divestitures Recent: 2006 - 2008 Fundamentals
Slide 47: Blank for Commercials
BLANK FOR COMMERCIALS
Slide 48: Financial Priorities and Outlook
Financial Priorities and Outlook
Slide 49: Financial Priorities: Healthy Balance Sheet and Liquidity
Financial Priorities for Sustainable, Profitable Growth Healthy balance sheet and liquidity Strong investment grade credit rating Access to credit markets to fund operations Continued access to commercial paper markets $1.5 billion revolving credit facility in place through December 2011
Slide 50: Financial Priorities: Operating Cash Flow and Margin
Financial Priorities for Sustainable, Profitable Growth Focus on operating cash flow Margin $ improvement to support earnings growth and brand reinvestment Narrow the spread between ConAgra Foods and competitor operating margins Improving ROIC driven by Margin $ growth Working capital and CAPEX disc
Slide 51: Economic Environment
Economic Environment Key Elements Inflation Cost control Pricing
Slide 52: Economic Environment: Inflation
Economic Environment: Inflation Inflation moderating, but still up year-over-year Certain commodity cost trends are favorable, but aggregate input costs are still higher than prior year Mixed outlook for FY2010 Lower commodity costs across many key inputs - edible oils, energy, grains Continued pres
Slide 53: Economic Environment: Controlling Costs
Sustained supply chain savings in Consumer Foods Cumulative ^ $750 million since the beginning of 2007 FY2009: Ahead of expectations at $250+ million Continued progress in FY2010: Targeting at least $225 million FY2007 FY2008 FY2009 est East 275 240 250 ConAgra Cost Reductions (CCRs, in millions) Ec
Slide 54: SG&A and SAP Benefits
SG&A Driving culture of Zero Overhead Growth (ZOG) Good progress on core SG&A in FY2009 Emerging SAP Benefits Supply chain and SG&A benefits Improved processes Visibility to costs Back Office efficiencies Implementation on track On time, on budget Benefits Economic Environment: Controlling Costs
Slide 55: Economic Environment: Pricing Actions
Consumer Foods: Strong list pricing advances in FY2008/FY2009 Promotion & Merchandising: Surgical course corrections ongoing Drive specific merchandising price points in stores Implement trade spending strategies to capitalize on opportunities All Commercial Foods businesses price to recover inflati
Slide 56: Full Year Outlook
Reiterate full FY2009 EPS guidance of slightly above $1.50 ^ $0.80 in H2 Q4 EPS greater than Q3 EPS (dollars) Consumer Foods operating profit improvement, concentrated in Q4 Banquet, Wesson results improve sequentially Innovation & marketing investment concentrated in Q3 53rd Week Full Year Outlook*
Slide 57: FY2010 Planning Considerations
FY2010 EPS outlook information provided later in this fiscal year FY2010 Planning Considerations Planning for healthy EPS growth in FY2010 Consumer Foods profit growth reflecting: Moderating inflation Innovation Value appeal of portfolio FY2010 planning, including assessment of economic impacts, cur
Slide 58: Long-Term Goals
Long-Term Goals EPS* growth averaging 8-10% CAPEX: Trending lower with more focus on innovation Working Capital: Improving working capital-to-sales ratios ROIC* approaching 12-13% *EPS and ROIC guidance discussed in this presentation excludes items impacting comparability. The inability to predict t
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Slide 60: Appendix A: Regulation G
Appendix A: Regulation G Fiscal 2009 EPS Reconciliation for Regulation G purposes