Hormel Foods Corporation · NYSE:HRL
Hormel Foods — Q2 2024 Earnings Presentation
22 slides from Hormel Foods's earnings presentation, May 30, 2024
Slide 1: Second Quarter Fiscal 2024 Supplemental Information
Second Quarter Fiscal 2024 SUPPLEMENTAL INFORMATION 1 We are supporting the Hormel® pepperoni brand with a new national advertising campaign, "Boldly Irresistible," highlighting its versatility and cravability.
Slide 2: Disclaimers: Forward-Looking Statements and Non-GAAP Information
Quarterly Quarterly DISCLAIMERS DISCLAIMERS Supplement Supplement Forward-Looking Statements This presentation contains “forward-looking” information within the meaning of the federal securities laws. The “forward-looking” information may include statements concerning the Company’s outlook for the f
Slide 3: Working Toward the Future
CORPORATE Quarterly RESPONSIBILITY Supplement Working Toward the Future Supporting efforts with a long-term impact Investment in State-of-the-Art Childcare Facility Applegate® 2025 Regenerative Beef Goal “At Hormel Foods, we are always striving to ensure Austin and the “As pioneers of the movements
Slide 4: Bringing On-Trend Innovation to Market
Quarterly INNOVATION Supplement Bringing On-Trend Innovation to Market By continuing to innovate in fast-growing, higher-margin categories Available Now Launching Soon Applegate Naturals® fully Planters® salt and vinegar cashews Hormel® Black Label® ranch SPAM® Korean BBQ flavored cooked Sunday Baco
Slide 5: Second Quarter Key Messages
BUSINESS Second Quarter HIGHLIGHTS Fiscal 2024 Second Quarter Key Messages ▪ We delivered a strong first half of the year, with consecutive quarters of better-than-expected earnings and a significant improvement in operating cash flows. ▪ We made further progress on our strategic initiatives. ▪ We a
Slide 6: Making Progress on Our Strategic Priorities
BUSINESS Second Quarter HIGHLIGHTS Fiscal 2024 Making Progress on Our Strategic Priorities To support long-term earnings growth Drive Focus and Growth in Expand Leadership in Aggressively Develop Execute our Enterprise our Retail Business Foodservice our Global Presence Entertaining & Snacking Visio
Slide 7: Investing for Growth
BUSINESS Second Quarter HIGHLIGHTS Fiscal 2024 Investing for Growth Future-fitting our One Supply Chain and continuing to transform and modernize our Company Continued the implementation of a new end-to-end planning process and are Plan integrating new planning technology. Realized the benefits from
Slide 8: Brand Spotlight
Brand Spotlight FY ‘24 Q2 8
Slide 9: Snacking & Entertaining Innovation; Skippy Brand Powers Athletes
Snacking & Skippy® Brand Entertaining Innovation Powers Athletes Skippy ® brand returns to the Skippy ® becomes the Official Peanut Canadian market with new peanut Butter of USA Gymnastics. butter-inspired snacking products. 9
Slide 10: Partnering with Pizza Professionals; New National Advertising Campaign
Partnering with New National Maintaining Our Leadership Pizza Professionals Advertising Campaign through Meaningful Innovation Hormel® pepperoni opens first-of- “Boldly Irresistible” is designed to cater to Hormel® ribbon Hormel® chorizo its-kind online shop with help of our consumers and their love
Slide 11: Second Quarter Financial Metrics
Q2 FINANCIAL Second Quarter METRICS Fiscal 2024 Second Quarter Financial Metrics Profit growth from Foodservice and International offset by Retail decline Net Diluted Adjusted Volume Diluted Net EPS1 Sales Net EPS (3)% (15)% (5)% (4)% 1.10B $2.98B $2.89B $0.40 $0.40 $0.38 1.06B $0.34 $2.86 B Q2 Q2 Q
Slide 12: First-Half Financial Metrics
H1 FINANCIAL First Half METRICS Fiscal 2024 First-Half Financial Metrics Delivers better-than-expected first-half earnings Net Diluted Adjusted Volume Diluted Net EPS1 Sales Net EPS Flat (1)% (6)% Flat 2.16B 2.16B $5.95B $5.88B $0.79 $0.79 $0.79 $0.74 $2.86 B H1 H1 H1 H1 H1 H1 H1 H1 2023 2024 2023 2
Slide 13: Generating Strong Operating Cash Flow
CASH FLOW First Half AND DEBT Fiscal 2024 Generating Strong Operating Cash Flow Significant operating cash flow improvement compared to last year Operating Cash Flow Q1 Cash & Mkt Sec. Debt +55% $640M Q2 $236M $1.5B $3.8B $412M $208M $404M Committed to Maintaining $204M Investment- H1 2023 H1 2024 G
Slide 14: Retail
RETAIL Second Quarter SEGMENT RESULTS Fiscal 2024 Retail Strategic investments supporting growth in key areas Segment Highlights Segment Highlights ▪ Net sales increased for many items, including Hormel® Black Label® bacon, Retail Q2 H1 YoY Percent YoY Percent the SPAM® family of products, Applegate
Slide 15: Foodservice
FOODSERVICE Second Quarter SEGMENT RESULTS Fiscal 2024 Foodservice Delivered another excellent start to the year Segment Highlights ▪ Products such as Hormel® Bacon 1 cooked bacon, Hormel® Fire Foodservice Q2 H1 YoY Percent YoY Percent Braised meats, Austin Blues® smoked meats, Café H® globally Segm
Slide 16: International
INTERNATIONAL Second Quarter SEGMENT RESULTS Fiscal 2024 International Recovery on track, with further improvement expected in the second half Segment Highlights ▪ Double-digit volume and net sales increases for SPAM® luncheon International Q2 H1 YoY Percent YoY Percent meat and refrigerated exports
Slide 17: Fiscal 2024 Outlook
FISCAL 2024 Quarterly OUTLOOK Supplement Fiscal 2024 Outlook Updating full-year earnings guidance Fiscal 2024 Outlook Outlook Commentary For fiscal year 2024, the Company is: Current Previous ▪ Reaffirming its net sales growth outlook of 1% to 3%. Net Sales (billions) $12.2 – $12.5 $12.2 – $12.5 ▪ U
Slide 18: Selected Financial Details – Q2 and FY 2024
ADDITIONAL Quarterly DISCLOSURES Supplement Selected Financial Details – Q2 and FY 2024 ▪ Advertising investments were $44 million, compared to $35 million last year. The Company expects full-year advertising expense to increase compared to the prior year. ▪ The effective tax rate was 22.5%, compare
Slide 19: Additional Information
David Dahlstrom Additional Director of Investor Relations Information dwdahlstrom@hormel.com 19
Slide 20: Non-GAAP Measures
Quarterly APPENDIX Supplement Non-GAAP Measures This presentation includes measures of financial performance that are not defined by U.S. generally accepted accounting principles (GAAP). The Company utilizes these non-GAAP measures to understand and evaluate operating performance on a consistent bas
Slide 21: Reconciliation of GAAP to Non-GAAP Measures
Quarterly APPENDIX Supplement The table below shows the calculations to reconcile from the GAAP measures to the non-GAAP measures. (1) Comprised primarily of asset write-offs related to portfolio optimization and project-based external consulting fees (2) Settlements for pork antitrust litigation. 2
Slide 22: Forward-looking GAAP to Non-GAAP Measures
Quarterly APPENDIX Supplement Forward-looking GAAP to Non-GAAP Measures Our fiscal 2024 outlook for adjusted diluted net earnings per share is a non-GAAP measure that excludes, or has otherwise been adjusted for, items impacting comparability, including estimated charges associated with the transfor