Central Garden & Pet Company · NASDAQ:CENT
Central Garden & Pet — Q2 2023 Earnings Presentation
20 slides from Central Garden & Pet's earnings presentation, May 3, 2023
Slide 1: Q2 FY2023 Investor Presentation
Q2 FY2023 Investor Presentation 5.3.2023
Slide 2: Business & Industry Update; Financials and Outlook; Q&A
Business & Industry Update Tim Cofer, CEO Q2 FY23 Financials, FY23 Outlook Niko Lahanas, CFO Management Q&A Tim Cofer, Niko Lahanas, J.D. Walker, John Hanson Q2 FY23 Investor Presentation 2
Slide 3: Forward-looking Statements
Forward-looking Statements This presentation includes “forward-looking statements.” Forward-looking statements include statements concerning our plans, objectives, goals, strategies, future events, future revenues or performance, capital expenditures, plans or intentions relating to acquisitions, ou
Slide 4: Central Garden & Pet
IFS CENTRAL GARD
Slide 5: Three Key Messages
Three Key Messages 1 2 3 Q2 challenged by late Cost & Simplicity program Prudent approach to start of garden season to improve margins full-year outlook • Multi-year journey • Cautiously optimistic garden • Simplify business, improve • Pet segment expanded share season will normalize and retailer ef
Slide 6: Pet: $475 million Q2 FY23 Net Sales
Pet: $475 million Q2 FY23 Net Sales Headwinds & Challenges Tailwinds & Successes • Solid growth in consumables, incl. Dog & Cat • Decline in durable pet supplies Treats & Toys, Small Animal, Aquatics, Equine • Share growth across most pet categories • Continuing SKU rationalization and exit of certa
Slide 7: Garden: $434 million Q2 FY23 Net Sales
Garden: $434 million Q2 FY23 Net Sales Headwinds & Challenges Tailwinds & Successes • Broad based softness across garden due • Wild bird remains a bright spot to unfavorable early spring weather • Grew market share in Grass Seed, • Lower foot traffic at retailers Outdoor Insect Controls and Wild Bir
Slide 8: Multi-year journey to reduce cost and simplify our business
Multi-year journey to reduce cost and simplify our business PRINCIPLES FOCUS AREAS Procurement: Leverage combined purchasing Simplify our business, focus SIMPLICITY power to reduce input costs and build margin our portfolio and supply chain Manufacturing: In-source third-party, reduce Improve our ef
Slide 9: Cost and simplicity program expected to deliver direct cost and efficiency benefits
Cost and simplicity program expected to deliver direct cost and efficiency benefits to fuel our long-term algorithm Greater focus on higher Significantly reduced Lower COGS through Lower administrative PROJECT margin, branded complexity: fewer SKUs, lower logistics costs, costs through scale OUTCOME
Slide 10: Central Garden & Pet
IFS CENTRAL GARD
Slide 11: Central to Home Strategy - Consumer Growth Agenda
Central to Home Strategy - Consumer Growth Agenda Comprehensive Digital marketing and Disruptive Nylabone Pennington Master Brand DTC eCommerce and Cadet innovation renovation excellence Q2 FY23 Investor Presentation 11
Slide 12: Tim Cofer, CEO; Niko Lahanas, CFO
Tim Cofer Niko Lahanas CEO CFO Q2 FY23 Investor Presentation 12
Slide 13: FY23 Q2 Performance
FY23 Q2 Performance Net Sales Gross Margin Operating Income EPS (in $ millions) (as a percentage of Net Sales) (in $ millions) (in $) Q2 FY23 Investor Presentation 13
Slide 14: Central Garden & Pet
IFS CENTRAL GARD
Slide 15: Solid Financial Metrics
Solid Financial Metrics Adjusted EBITDA Long-Term Debt Total Leverage (1) (in $ millions) (in $ millions) Q2 FY23 Investor Presentation (1) Calculated as Indebtedness / Adj. EBITDA as defined by the Company's ABL credit agreement 15
Slide 16: FY23 Outlook
Prudent approach to full-year guidance FY23 Outlook • Cautiously optimistic garden season will normalize • Expecting retailer inventory dynamics to stabilize Cost & Simplicity program to support long-term algorithm • Multi-year journey to reduce cost and simplify our business • Program will drive hi
Slide 17: Q&A
Q&A Please reach out to us with any comments or questions: IR@Central.com (925) 412-6726 Q2 FY23 Investor Presentation 17
Slide 18: Appendix
Appendix IF CENTRAL GARDEN & PET
Slide 19: Notes & Disclosures
Notes & Disclosures Use of Non-GAAP Financial Measures We report our financial results in accordance with accounting principles generally accepted in the United States (GAAP). However, to supplement the financial results prepared in accordance with GAAP, we use non-GAAP financial measures including
Slide 20: GAAP to Non-GAAP Reconciliation for the Fiscal Quarter Ended
GAAP to Non-GAAP Reconciliation for the Fiscal Quarter Ended (in thousands, except for per share amounts) March 25, 2023 March 26, 2022 Adjusted EBITDA Reconciliation Net income attributable to Central Garden & Pet Company $ 48,115 $ 69,713 Interest expense, net 14,690 14,702 Other (income) expense
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