The Kraft Heinz Company · NASDAQ:KHC
The Kraft Heinz — Q1 2025 Earnings Presentation
29 slides from The Kraft Heinz's earnings presentation, Apr 29, 2025
Slide 1: Q1 2025 Business Update
April 29, 2025 Q1 2025 BUSINESS UPDATE TO ACCOMPANY MANAGEMENT COMMENTARY
Slide 2: Forward-Looking Statements
FORWARD-LOOKING STATEMENTS APRIL 29, 2025 This presentation contains a number of forward-looking statements as defined under U.S. federal securities laws, including, but not limited to, statements, estimates, and projections relating to our business and long-term strategy; our ambitions, goals, targ
Slide 3: Business & Strategy Update
Q4 2024 Business Update Q1 2025 Business & Strategy Update Chief Executive Officer CARLOS ABRAMS-RIVERA
Slide 4: Key messages: vital role in families' lives, updated 2025 outlook
Q1 2025 Business Update • We play a vital role in families’ lives. Our high-quality products provide comfort and connection, particularly in moments of uncertainty. • We are committed to increasing investments to provide value to our consumers while driving product and brand superiority. • Q1 result
Slide 5: Q1 Results in Line with Expectations
Q1 Results in Line with Expectations Q1 2025 Business Update Constant Currency Total Adjusted Gross Organic Net Sales1 Adj. Operating Adjusted EPS1 Free Cash Flow1 Profit Margin1 Kraft Heinz Income1 Q1 ‘25 $6.1B 34.4% $1.2B $0.62 $482M vs PY (4.7%) (10bps) (4.4%) (10.1%) +1.0% 1| Non-GAAP financial
Slide 6: Our 2025 Priorities Are Aligned With Our Long-Term Strategy
Our 2025 Priorities Are Aligned With Our Long-Term Strategy Q1 2025 Business Update UNLOCK REINVEST IN THE POWER BRAND ACCELERATE EFFICIENCIES BUSINESS SUPERIORITY PROFITABLE GROWTH 6
Slide 7: Demonstrated Meaningful Progress Across our Strategic Initiatives
Demonstrated Meaningful Progress Across our Strategic Initiatives Q1 2025 Business Update Our Ability to Consistently Unlock Efficiencies Investing in Value-Driving Scaling Brand Growth System Initiatives On Track to Deliver Goal of $2.5B by 2027 Sales Coverage of Brand Growth System Reducing Price
Slide 8: Two Strategic Pillars Gaining Momentum, with Pressure in NA Retail
Two Strategic Pillars Gaining Momentum, with Pressure in NA Retail Accelerate Q1 2025 Business Update Strategic Pillars Organic Net Sales1 Q1 ‘25 vs Q1 ‘24 N.A. Retail ACCELERATE (8.1%) Driven by a decline in Lunchables, lapping competitor out of stocks, and the Easter shift, partially offset by str
Slide 9: Leveraging Brand Growth System to Drive Brand and Product Superiority
Leveraging Brand Growth System to Drive Brand and Product Superiority Q1 2025 Business Update + Leverage Brand Execute With System Identified Areas Where to Invest to Drive Utilizing Agile@Scale Ways of Working to Brand and Product Superiority Accelerate Improvement Across Brands % of Sales Covered
Slide 10: Committed to our #1 Market Share Position in Lunchables
Committed to our #1 Market Share Position in Lunchables Q1 2025 Business Update Bringing Incrementality Driving Quality Delivering Omnichannel to the Category Improvements in the Core Execution NEW RENOVATION BIGGEST Innovation Launching! Hitting Shelves in the Fall! Lunchables Fall Season Ever! GRE
Slide 11: Powering an Amazing Turnaround in Capri Sun
Powering an Amazing Turnaround in Capri Sun Q1 2025 Business Update Driving Superiority Expanding Accessibility in Delighting Consumers with in Core Product Channels & Occasions Limited-Time Offerings Post RENOVATION Results New Single-Serve Bottles Significantly Driving Brand Love by Showing up in
Slide 12: Attracting New Consumers and Delivering Consumer Preferences in Mac & Cheese
Attracting New Consumers and Delivering Consumer Preferences in Mac & Cheese Q1 2025 Business Update Bringing Incrementality Investing in Product & Package Expanding Value to the Category to Showcase Superiority Offerings and Occasions NEW Shapes! OPTIMIZATION Coming in Q2 VALUE Formats Launching No
Slide 13: Leveraging Brand Growth System to Take Insights to Action across Mayo
Leveraging Brand Growth System to Take Valuable Insights to Action across Mayo Q1 2025 Business Update Investing in Packaging Executing a Regional Media Leveraging Successes and Price Plan Key During Seasons Across the Globe New graphics on shelves now Launching Full Heinz Line Now in Canada! Money
Slide 14: Strong Growth Across Several Categories in North America
Strong Growth Across Several Categories in North America ACCELERATE N.A. Retail Accelerate Pasta Sauce Canada Frozen Meals Primal Kitchen Mexican Foods & Sauces +5% +7% +10% +15% Q1 Organic Net Sales1 vs PY Q1 Organic Net Sales1 vs PY Q1 Organic Net Sales1 vs PY Q1 Organic Net Sales1 vs PY 1g SUGAR
Slide 15: Success Across Away From Home Despite Challenging Environment
Despite a Challenging Environment, Seeing Success Across Away From Home Global Away From Home Higher-Margin Beyond Go To Market Gaining share in higher-margin Increasing penetration Expanding distribution Away From Home channels across brands & categories through sales excellence Dollar Sales Growth
Slide 16: Growth in Emerging Markets Powered by Heinz and Go To Market Model
Growth in Emerging Markets Powered by Heinz and Go To Market Model Emerging Markets the Power of Heinz Distribution through Go To Market Model Emerging Markets Q1 Organic Net Sales1,2 Q1 ‘25 vs PY Approximately GTM Heinz +11% ~40% +21K Total Distribution Points3 Q1 ‘25 vs Q1 ‘24 1| Non-GAAP financia
Slide 17: Through Innovation, We Continue to Deliver Products Worth Paying For
Through Innovation, We Continue to Deliver Products Worth Paying For Q1 2025 Business Update Exploring Flavors, Satisfying Desires Expanding Accessibility & Relevance Delivering Unique Benefits By Bringing the Restaurant Across New Channels, Occasions, Such as Convivence and Experience to and +26% U
Slide 18: Powering our Brands with Marketing that Matters
Powering our Brands with Marketing that Matters Q1 2025 Business Update At the Speed of Aligned to Key Activating with Agility to Capitalize on Real-Time Increasing Relevance and Showing Up at Well-Timed Consumer Insights and Trends Moments in Culture Dip & Decorate Marshmallow Kit Ore Ida and HEIR
Slide 19: Business & Strategy Update
Q4 2024 Business Update Q1 2025 Business & Strategy Update Global Chief Financial Officer ANDRE MACIEL
Slide 20: Q1 in Line With Expectations, with Top Line Pressure Primarily in the U.S.
Q1 in Line With Expectations, with Top Line Pressure Primarily in the U.S. Q1 2025 Business Update Organic Q1 25 vs Q1 24 Net Sales 1 Price Volume / Mix Total Kraft Heinz (4.7%) 0.9pp (5.6pp) North America (6.5%) 0.6pp (7.1pp) Growth in Canada more than offset by lower sales Includes (120bps) impact
Slide 21: Adjusted Operating Income Declines Driven by Inflation and Currency Headwinds
Adjusted Operating Income Declines Driven by Inflation and Currency Headwinds Q1 2025 Business Update Adjusted Constant Currency Adjusted Operating Adj. Operating Operating Income Q1 25 vs Q1 24 Income 1 Currency Income 1 Margin1 Total Kraft Heinz (5.2%) (0.8pp) (4.4%) 20.0% +0.3pp vs PY North Ameri
Slide 22: Efficiencies Funding Incremental Investments in Key Growth Areas
Efficiencies Funding Incremental Investments in Key Growth Areas Q1 2025 Business Update Investing in while Optimizing our Spend Investing in Price to Fuel Growth Improving Marketing Returns Media Spend ($)1 Media ROI2 Across Key Brands and Markets +DD% +DD% 2024 2025E 2023 2024 2025E • Re-establish
Slide 23: Productivity Savings Helping Mitigate Inflation Pressures
Productivity Savings Helping Mitigate Inflation Pressures Q1 2025 Business Update Supply Chain Efficiencies Adjusted Gross Profit Margin2 On Track to Deliver $2.5B Goal1 Gross Efficiencies (% COGS) $2 $2.5B+ (10bps) 4.0% 34.5% 34.4% 3.0% LTA 2.0% 2025E 1.0% $1.5B Q1 2024 0.0% Q1 '25 2025 Goal Q1 '24
Slide 24: Continued Strong Cash Generation, with Decline in EPS Driven by Tax Headwind
Continued Strong Cash Generation, with Decline in EPS Driven by Tax Headwind Q1 2025 Business Update Free Cash Flow1 and Adjusted EPS1 Free Cash Flow Conversion1 +9pp (10.1%) 65% 56% $0.69 $0.62 $482M $477M Q1 '24 Q1 '25 Q1 '24 Q1 '25 Primarily driven by lower cash outflows from vs Q1 2024 variable
Slide 25: Strong Balance Sheet Provides Better Positioning in Uncertain Times
Strong Balance Sheet Provides Better Positioning in Uncertain Times Q1 2025 Business Update Strong Generation Combined with a Healthy Ratio Free Cash Flow Conversion1 Net Leverage1 ~95% 4.4x 81% 85% 2.9x 2023 2024 2025E 2019 2020 2021 2022 2023 2024 Working capital improvements more than Significant
Slide 26: Capital Allocation Strategy
We Continue to be Excellent Stewards of Capital Q1 2025 Business Update Capital Allocation Strategy Competitive Target Leverage Ratio of Maintain Annual Dividend Approximately 3.0x Investment Grade Return Invest in Actively Incremental Organic Manage Capital to Growth Portfolio Stockholders 26
Slide 27: Maintaining a Healthy Balance Sheet While Returning Capital to Stockholders
Maintaining a Healthy Balance Sheet While Returning Capital to Stockholders Q1 2025 Business Update Returned $900M Incremental to Stockholders Year-to-Date2 Maintained Net Leverage1 Returning Incremental Target of ~3.0x Capital to Stockholders 3.0x 3.0x Q1 ‘25 Dividends YTD ‘25 Share Repurchases $0.
Slide 28: 2025 Outlook
2025 Outlook Q1 2025 Business Update 2025 FY Outlook 2025 FY Considerations • FY25 impact from currency at current FX rates: ~(30bps) • Sequential quarterly Organic Net Sales improvement beginning in Q2 Organic Net Sales1 (1.5%) to (3.5%) • Timing of Easter expected to benefit Q2-25 by ~100bps • Fla
Slide 29: Business & Strategy Wrap Up
Q4 2024 Business Update Q1 2025 Business & Strategy Wrap Up Chief Executive Officer CARLOS ABRAMS-RIVERA
The Kraft Heinz Company — Q1 2025 Earnings Presentation on 6ix