Slide 1: Q1 2023 Earnings
Q1 2023 EARNINGS May 8, 2023 1 Q1 2023 EARNINGS PRESENTATION
Slide 2: Forward Looking Statements & Non-GAAP Measures
FORWARD LOOKING STATEMENTS & NON-GAAP MEASURES Forward-Looking Statements Non-GAAP Measures Certain statements in this presentation by Freshpet, Inc. (the “Company”) constitute Freshpet uses certain non-GAAP financial measures, including EBITDA, Adjusted EBITDA, “forward-looking” statements, which i
Slide 3: Forward Looking Statements & Non-GAAP Measures
FORWARD LOOKING STATEMENTS & NON-GAAP MEASURES Freshpet defines Adjusted Gross Profit as gross profit before depreciation expense, COVID- Certain of these measures represent the Company's guidance for fiscal year 2023. The 19 expense and non-cash share-based compensation, and Adjusted SG&A as SG&A C
Slide 4: Freshpet strengthens the bond between people and our pets
FRESHPET STRENGTHENS THE BOND BETWEEN PEOPLE AND OUR PETS SO THAT WE BOTH LIVE LONGER, HEALTHIER AND HAPPIER LIVES WHILE BEING KIND TO THE PLANET. 4 Q1 2023 EARNINGS PRESENTATION
Slide 5: Progress Report
PROGRESS REPORT Advertising & Innovation Drive Efficiencies Expand HH in Logistics Penetration Leverage Scale Increase in COGS Velocity Leverage Scale Expand Visibility in SG&A & Availability Expand Capacity 5 Q1 2023 EARNINGS PRESENTATION
Slide 6: Q1 2023 Results
Q1 2023 RESULTS 6 Q1 2023 EARNINGS PRESENTATION
Slide 7: Strong start to 2023 demonstrating improved operating performance and growth
STRONG START TO 2023 THAT DEMONSTRATES IMPROVED OPERATING PERFORMANCE AND STRONG GROWTH FRESHPET Q1 2023 NET SALES FRESHPET Q1 2023 ADJ. EBITDA ($ millions) ($ millions) $167.5 $132.2 +27% $3.0 +41% ($0.3) 2022 2023 2022 2023 7 Q1 2023 EARNINGS PRESENTATION
Slide 8: Net sales growth driven by volume, pricing/mix, offset by trade inventory re-fill
NET SALES GROWTH DRIVEN BY VOLUME, PRICING/MIX AND PARTIALLY OFFSET BY TRADE INVENTORY RE-FILL IN THE YA Q1 2023 NIELSEN CONSUMPTION GROWTH 31% 32% 29% 19% MegaChannel Total US xAOC Total US Food Pet Superstores + PSP (xAOC+Pet Superstore) 8 Source: Nielsen consumption data thru 4/1/23 and internal
Slide 9: Improved input costs, quality and logistics lift Adj. gross margin and Adj. EBITDA
STRONG IMPROVEMENT ON INPUT COSTS/PRICING, QUALITY AND LOGISTICS OFFSET START-UP EXPENSES TO DELIVER IMPROVED ADJ. GROSS MARGIN AND ADJ. EBITDA Q1 2023 ADJ. GROSS MARGIN KEY OPERATING COSTS (% of net sales) 36.1% 34.1% 38.3% 38.5% Q1 22 Q1 23 9.9% 9.3% 6.1% 5.3% Q1 2022 Q1 2023 Quality Input Costs L
Slide 10: Ennis Kitchen: start-up is on-track
ENNIS KITCHEN: START-UP IS ON-TRACK 12 bags sku’s qualified for production Bag line began shipping product in mid-April Chicken processing operation is on-track for start-up in Q2 Roll line production now 24/7 10 Q1 2023 EARNINGS PRESENTATION
Slide 11: FY 2023 Guidance
FY 2023 GUIDANCE 11 Q1 2023 EARNINGS PRESENTATION
Slide 12: Re-affirming 2023 guidance: improving profitability while driving growth
RE-AFFIRMING 2023 GUIDANCE: FOCUS ON IMPROVING PROFITABILITY WHILE DRIVING GROWTH FRESHPET FINANCIAL PROJECTIONS $100 • Volume cadence: Shipment growth strongly tied to $800 ~ $750.0 $90 sequential consumption growth. Year-on-year growth $700 trends skewed by trade inventory re-fill in 2022. $80 $59
Slide 13: 2023 Guidance: Q2 Expectations
2023 GUIDANCE: Q2 EXPECTATIONS Volume cadence: Q2 2023 is projected to have similar (mid-20’s) net sales growth as Q1 2023. Advertising investment: Very heavy advertising investment to drive renewed engagement and offset impact of last two price increases. Logistics costs: Q2 2023 will include signi
Slide 14: 2023 Plan: Key Growth Drivers
2023 PLAN: KEY GROWTH DRIVERS STRONG ADVERTISING SIGNIFICANT INCREASE NEW PRODUCT INVESTMENT IN RETAIL PRESENCE LAUNCHES 14 Q1 2023 EARNINGS PRESENTATION
Slide 15: 2023 Plan: Operational Improvements
2023 PLAN: OPERATIONAL IMPROVEMENTS Ample More efficient Improved Commodity costs capacity logistics quality in line with pricing 15 Q1 2023 EARNINGS PRESENTATION
Slide 16: Household Penetration & Buying Rate
HOUSEHOLD PENETRATION & BUYING RATE 16 Q1 2023 EARNINGS PRESENTATION
Slide 17: Continued growth in consumer franchise; approaching 10MM households
CONTINUED GROWTH IN CONSUMER FRANCHISE; APPROACHING 10MM HH’S WITH VERY STRONG BUYING RATE INCREASE FRESHPET PENETRATION GROWTH FRESHPET BUYING RATE 9,644,259 $95.60 9,011,062 7,147,894 +7% $73.83 $74.67 +28% 6,081,982 +26% $61.41 $56.12 +20% +1% 4,885,270 +18% +25% +9% 2019 2020 2021 2022 2023 2019
Slide 18: Freshpet heavy/super heavy buyers continue to increase
FRESHPET HEAVY/SUPER HEAVY BUYERS CONTINUE TO INCREASE FRESHPET ULTRA/SUPER HEAVY/HEAVY BUYERS 5 YEAR TREND 4,000,000 Ultra/Super Heavy/Heavy Buyers: $290 3,500,000 Bought at least $40 in the most recent 10 weeks 3,340,902 $270 3,000,000 2,839,080 +18% 2,500,000 +29% $250 2,197,962 $243.87 $230 2,00
Slide 19: Current Consumption Trends
CURRENT CONSUMPTION TRENDS 19 Q1 2023 EARNINGS PRESENTATION
Slide 20: Volume growth is beginning to drive consumption growth again
VOLUME GROWTH IS BEGINNING TO DRIVE CONSUMPTION GROWTH AGAIN FRESHPET NIELSEN MEGA-CHANNEL DOLLAR SALES AND POUNDS GROWTH RATE $20,000,000 70% $18,000,000 60% $16,000,000 50% $14,000,000 40% $12,000,000 30% $10,000,000 20% $8,000,000 10% $6,000,000 0% $4,000,000 $2,000,000 -10% $0 -20% Mega Channel
Slide 21: 2-year stacked growth remains strong
2-YEAR STACKED GROWTH REMAINS STRONG NIELSEN MEGA-CHANNEL CONSUMPTION GROWTH 2-YEAR STACKED 78% 75% 75% 72% 72% 70% 70% 71% 69% 67% 67% 66% 66% 65% 65% 65% 60% 61% 61% 61% 59% 60% 59% 30% 57% 56% 57% 56% 57% 58% 58% 56% 58% 57% 58% 56% 57% 57% 32% 27% 56% 55% 53% 54% 52% 53% 53% 54% 53% 30% 28% 52%
Slide 22: Q1 2023 Visibility & Availability
Q1 2023 VISIBILITY & AVAILABILITY 22 Q1 2023 EARNINGS PRESENTATION
Slide 23: Store count continues to grow
STORE COUNT CONTINUES TO GROW FRESHPET STORE COUNT 25,281 25,650 23,631 22,716 21,570 19,499 18,004 16,609 15,015 13,387 10,826 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 YTD 2023 23 Source: Internal data for the period ending 4/1/23 Q1 2023 EARNINGS PRESENTATION
Slide 24: Retail availability at record levels
RETAIL AVAILABILITY AT RECORD LEVELS FRESHPET TOTAL DISTRIBUTION POINTS (TDP'S) NIELSEN MEGA-CHANNEL 1,100 1024 1,000 900 800 700 600 500 24 Source: Nielsen Mega-Channel Data thru 4/22/23 Q1 2023 EARNINGS PRESENTATION
Slide 25: Appendix
APPENDIX 25 Q1 2023 EARNINGS PRESENTATION
Slide 26: Q1 2023 EARNINGS PRESENTATION
26 Q1 2023 EARNINGS PRESENTATION
Slide 27: Q1 2023 EARNINGS PRESENTATION
27 Q1 2023 EARNINGS PRESENTATION
Slide 28: Q1 2023 EARNINGS PRESENTATION
28 Q1 2023 EARNINGS PRESENTATION
Slide 29: Q1 2023 EARNINGS PRESENTATION
29 Q1 2023 EARNINGS PRESENTATION