Utz Brands Inc · NYSE:UTZ

Utz Brands — Q3 2021 Earnings Presentation

28 slides from Utz Brands's earnings presentation, Nov 11, 2021

  1. Slide 1: Utz Brands, Inc. Q3 2021 Earnings Presentation

    ℠ Utz Brands, Inc. Q3 2021 Earnings Presentation November 11, 2021 1

  2. Slide 2: Disclaimer

    Disclaimer Forward-Looking Statements Certain statements made herein are not historical facts but are “forward-looking statements” within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995, as amended. The forward-looking statements generally are acco

  3. Slide 3: Business Overview

    Business Overview Dylan Lissette, Chief Executive Officer 3

  4. Slide 4: Key Messages

    Key Messages  Demand for our brands remains strong and our two-year sales growth is accelerating as we continue to lap the strong consumption impact from COVID-19 with improved strength in our Core and significant Emerging and Expansion growth  Q3'21 IRI retail sales outpaced the Salty Snack Categ

  5. Slide 5: Value Creation Strategies

    Value Creation Strategies Continued Consistent Execution in 3Q'21 Reduce Costs and Reinvest to Accelerate Continue Strategic Enhance Margins Revenue Growth Acquisitions  On track to achieve ~2% 3Q'21 performance below reflects 2-Year CAGR  Recently announced the IRI Retail Sales Results for 13-wee

  6. Slide 6: Summary of Q3 Results

    Summary of Q3 Results  Net sales growth of 26.1% primarily reflects the positive contribution from acquisitions – Organic Net Sales growth of 1% on top of strong 10% Organic growth in 3Q’20  Sales momentum is building and Pro Forma Net Sales 2-year CAGR of 6.4% increased from 6.1% in Q2 and 4.3% i

  7. Slide 7: Q3 Retail Sales 2-Year Growth Rates Accelerating

    Q3 Retail Sales 2-Year Growth Rates Accelerating Total Utz portfolio returned to 2-year share gains in the quarter driven by Power Brands Foundation Brands retail sales declines slowing as we lap peak COVID-19 pantry loading Retail Sales 2-Year CAGR Rolling 12-Week Trend 11.0% 10.4% Utz Power Brands

  8. Slide 8: Gaining Share Power Brand Share Over Last Two Years

    Gaining Share Power Brand Share Over Last Two Years Power brands are now 87% of our portfolio, an increase of 200bps from two years ago Foundation Brand performance reflects the continued shift in focus to Power Brands, and performance is improving Power Brands Retail Sales Change(1) Foundation Bran

  9. Slide 9: Two-Year Growth Across Major Sub-Categories

    Two-Year Growth Across Major Sub-Categories Power Brands two-year share gains across every major sub-category and our total Utz Platform gained share in four of five tracked sub-categories Double-digit two-year CAGR’s in tortilla chips, pretzels, cheese snacks, salsa and queso Sub-Category Retail Sa

  10. Slide 10: Positive Momentum Led by Power Brands Across All Geographies

    Positive Momentum Led by Power Brands Across All Geographies Expansion and Emerging continue to outperform with two-year growth rates significantly outpacing the Category by 400 bps and 550bps, respectively Core momentum improving with a return to year-over-year growth and two-year growth doubles fr

  11. Slide 11: Strong Growth for ON THE BORDER In All Geographies

    Strong Growth for ON THE BORDER® In All Geographies Leveraging the Utz sales platform to drive increasing growth and unlock revenue synergies Transitioned our primary DSD Distributor for ON THE BORDER® in certain key Core geographies to Utz in August 2021 and we are seeing positive early results ON

  12. Slide 12: Share Gains in Grocery, Mass and C-Store

    Share Gains in Grocery, Mass and C-Store Continued strong growth across all channels with largest share gains in Grocery, Mass and C-store Momentum is building and Power brands are driving positive momentum across all channels Retail Channel Retail Sales 2-Year CAGR (13-Weeks Ended 10/4/21) Total Sa

  13. Slide 13: Financial Performance

    Financial Performance Ajay Kataria, Chief Financial Officer 13

  14. Slide 14: Third Quarter 2021 Financial Results Summary

    Third Quarter 2021 Financial Results Summary 3Q’20 3Q’21 YoY Results Results Change In $millions, except per share amounts Net Sales 248.0 312.7 +26.1% Pro Forma Net Sales 308.3 312.7 +1.4% Adj. Gross Profit 99.2 111.8 +12.7% % of net sales 40.0% 35.8% (420bps) Adj. SG&A 60.9 66.1 +8.5% % of net sal

  15. Slide 15: Q3 Balance Sheet and Additional Items

    Q3 Balance Sheet and Additional Items  As of October 3, 2021, the Company had $26M of cash on hand and $133M available under its revolving credit facility, providing liquidity in excess of $159M  Expect to use balance sheet cash and revolving credit facility to fund the $56M cash purchase price fo

  16. Slide 16: Q3 Net Sales Bridge

    Q3 Net Sales Bridge  Growth driven by acquisitions and Organic growth of 1% (+2% excluding IO discounts)  Price/mix improved from Q1’21 and Q2’21 with momentum building  Volumes impacted by COVID-19 overlap and supply disruptions  Pro Forma Net Sales 2-year CAGR of 6.4%, up from Q2’21 rate of 6.

  17. Slide 17: Q3 Adjusted EBITDA Margin Bridge

    Q3 Adjusted EBITDA Margin Bridge  Favorable price/mix and modest benefits from productivity initiatives  Volume declines due to 2020 COVID-19 overlap and supply chain disruptions  Higher inflation which includes commodities, transportation and labor Q3 Adjusted EBITDA Margin Decomposition 1.0% -0

  18. Slide 18: Implementing Pricing Actions in Response to Rising Input Costs

    Implementing Pricing Actions in Response to Rising Input Costs Our total input costs across not only …we reacted quickly and began commodities, but also labor and implementing pricing actions to help transportation, have continued to offset rising inflation with the benefits increase throughout 2021

  19. Slide 19: Fiscal 2021 Outlook

    Fiscal 2021 Outlook Continue to expect fiscal 2021 net sales to be consistent with fiscal 2020 Pro Forma Net Sales with modest Organic Net Sales growth year-over-year Earnings outlook reflects rising inflation due to the challenging industry-wide supply chain environment and a lower tax rate and low

  20. Slide 20: Fiscal 2021 Outlook (cont.)

    Fiscal 2021 Outlook (cont.) Additional Assumptions  Unchanged Assumptions – Funded $25M Vitner's acquisition in February 2021 with balance sheet cash – Funded $41M Festida Foods acquisition in June 2021 with revolving credit facility – Incremental term loan of $75M to pay down revolver and put cash

  21. Slide 21: Appendix

    Appendix yp VEGGIE STRAW ed AVOCADO OIL § CLASSIC SEA SALT @ KETTLE STYLE POTATO CHIPS Fe] ©

  22. Slide 22: Reconciliation of Non-GAAP Financial Measures to Reported Financial Measures

    Reconciliation of Non-GAAP Financial Measures to Reported Financial Measures Net Sales and Pro Forma Net Sales 13-Weeks Ended 39-Weeks Ended October 3, 2021 September 27, 2020 October 3, 2021 September 27, 2020 (Combined (Combined Successor and Successor and (dollars in millions) (Successor) Predece

  23. Slide 23: Reconciliation of Non-GAAP Financial Measures to Reported Financial Measures

    Reconciliation of Non-GAAP Financial Measures to Reported Financial Measures Gross Profit, Adjusted Gross Profit and PF Adj Gross Profit 13-Weeks Ended 39-Weeks Ended October 3, 2021 September 27, 2020 October 3, 2021 September 27, 2020 (Combined (Combined Successor and Successor and (dollars in mil

  24. Slide 24: Reconciliation of Non-GAAP Financial Measures to Reported Financial Measures

    Reconciliation of Non-GAAP Financial Measures to Reported Financial Measures Adjusted Selling, General and Administrative Expense 13-Weeks Ended 39-Weeks Ended October 3, 2021 September 27, 2020 October 3, 2021 September 27, 2020 (Combined (Combined Successor and Successor and (dollars in millions)

  25. Slide 25: Reconciliation of Non-GAAP Financial Measures to Reported Financial Measures

    Reconciliation of Non-GAAP Financial Measures to Reported Financial Measures Adjusted Net Income 13-Weeks Ended 39-Weeks Ended October 3, 2021 September 27, 2020 October 3, 2021 September 27, 2020 (Combined (Combined Successor and Successor and (dollars in millions, except per share data) (Successor

  26. Slide 26: Reconciliation of Non-GAAP Financial Measures to Reported Financial Measures

    Reconciliation of Non-GAAP Financial Measures to Reported Financial Measures Depreciation and Amortization Expense 13-Weeks Ended 39-Weeks Ended October 3, 2021 September 27, 2020 October 3, 2021 September 27, 2020 (Combined (Combined Successor and Successor and (dollars in millions) (Successor) Pre

  27. Slide 27: Reconciliation of Non-GAAP Financial Measures to Reported Financial Measures

    Reconciliation of Non-GAAP Financial Measures to Reported Financial Measures EBITDA, Adjusted EBITDA and Further Adjusted EBITDA 13-Weeks Ended 39-Weeks Ended October 3, 2021 September 27, 2020 October 3, 2021 September 27, 2020 (Combined (Combined Successor and Successor and (dollars in millions) (

  28. Slide 28: Reconciliation of Non-GAAP Financial Measures to Reported Financial Measures

    Reconciliation of Non-GAAP Financial Measures to Reported Financial Measures Adjusted EBITDA FY 2020 FY 2021 (Combined (Combined Successor and Successor and (Predecessor) Predecessor) (Successor) Predecessor) (Successor) (Successor) (dollars in millions) Q1 Q2 Q3 Q4 FY 2020 Q1 Q2 Q3 TTM Further Adju

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