The Simply Good Foods Company · NASDAQ:SMPL
The Simply Good Foods — Q3 FY2020 Earnings Presentation
21 slides from The Simply Good Foods's earnings presentation, Jul 8, 2020
Slide 1: Third Quarter Fiscal Year 2020 Earnings Conference Call & Webcast Presentation
Third Quarter Fiscal Year 2020 Earnings Conference Call & Webcast Presentation July 8, 2020 0
Slide 2: Disclaimer
Disclaimer Forward Looking Statements Certain statements made herein are not historical facts but are forward-looking statements for purposes of the safe harbor provisions under The Private Securities Litigation Reform Act of 1995. Forward-looking statements generally are accompanied by or include w
Slide 3: Joseph E. Scalzo, President and Chief Executive Officer
JOSEPH E. SCALZO PRESIDENT AND CHIEF EXECUTIVE OFFICER 2
Slide 4: Today's Speakers and Agenda
Today’s Speakers and Agenda Speakers Agenda \ Mark Pogharian Introduction VP, Investor Relations Joe Scalzo Third Quarter 2020 Highlights President & Chief Executive Officer Business Update Todd Cunfer Financial Summary Chief Financial Officer Q&A 3
Slide 5: COVID-19 Impact
COVID-19 Impact Supply chain – procurement, manufacturing and distribution – performed flawlessly during the quarter, with no major issues During the first 3 weeks of March, similar to the nutritional snacking category, Atkins® and Quest® generated above average growth during consumer “stock-up”
Slide 6: 3rd Quarter Fiscal 2020 Overview
3rd Quarter Fiscal 2020 Overview Atkins and Quest net sales impacted by COVID-19 movement restrictions Gross and EBITDA margin expansion driven by a decline in trade promotion, as well as lower Selling & Marketing and General & Administrative expenses Quest integration and ERP implementation o
Slide 7: 3rd Quarter Revenue and Profit
3rd Quarter Revenue and Profit $215.1 Driven by: Quest +62.5% Legacy Atkins Business -8.3% $139.5 Driven by: + Contribution from Quest; impact of lower legacy Atkins sales partially offset by reduced trade promotion + Gross profit increase driven by Quest contribution + Lower legacy Atkins Selling &
Slide 8: Year-to-Date Retail Takeaway
Year-to-Date Retail Takeaway Weekly Retail Takeaway % Chg. Vs. YAG Pre COVID-19 Stock-Up Period COVID-19 Confinement Period Base Business on Track Confinement Restrictions Ease 7 Source: IRI/MULO 1 week ending 1/5/20 thru 6/28/20; Quest excludes pizza
Slide 9: Atkins Q3 Retail Takeaway
Atkins® Q3 Retail Takeaway Atkins confections momentum continues, retail takeaway increased +12.4% in Q3. Bars off -13.4%, slightly better than category; RTD shakes declined -19.2% - Weight management less relevant in early stages of confinement period - About 40% of consumption occurs away from h
Slide 10: Quest Q3 Retail Takeaway
Quest® Q3 Retail Takeaway Quest outpaced the category with retail takeaway increasing +5.2% - ~55% of U.S. sales in measured channels Retail takeaway driven by cookies and chips, up a combined 54.2%, and RTD shakes Quest bars were impacted by lower on-the-go usage occasions, down -17.6% in Q3,
Slide 11: Simply Good Foods Brand Initiatives
Simply Good Foods Brand Initiatives As movement restrictions began to ease we increased marketing spending - Anticipate Q4 advertising and marketing spend to be greater than Q3 Initiatives focused on: - in-store display activity and promotion - improved TV, digital and print communications Inn
Slide 12: Summary
Summary Simply Good Foods is uniquely positioned as a U.S. leader in nutritional snacking – Atkins® and Quest® are compelling consumer lifestyle brands that transcend multiple forms Quest integration and cost synergies of $20 million on track; majority to be achieved in fiscal ‘21-22 A portfol
Slide 13: Todd Cunfer, Chief Financial Officer
TODD CUNFER CHIEF FINANCIAL OFFICER 12
Slide 14: Net Sales Drivers
Net Sales Drivers Total Simply Good Foods 13
Slide 15: Simply Good Foods Sales by Form
Simply Good Foods Sales by Form Bars is a big part of the portfolio Simply Goods Foods U.S. Snacking Gross Sales by Channel Cookies Mass Chips Confections Bars RTD Shakes All Oth. 14
Slide 16: 3rd Quarter Net Sales and Profit
3rd Quarter Net Sales and Profit Fiscal Q3 2020 vs. Year Ago Period Net Sales1 Gross Profit Adjusted EBITDA (and % Margin)1 (and % Margin)1,2 54.2% Year-Over-Year 56.4% Year-Over-Year 74.2% Year-Over-Year Growth Growth Growth $215.1 $139.5 $88.6 41.2% $56.7 40.6% $43.4 20.2% $24.9 17.8% 3Q19 3Q20 3Q
Slide 17: Year-to-Date Net Sales and Profit Growth
Year-to-Date Net Sales and Profit Growth Fiscal YTD 2020 vs. Year Ago Period Net Sales1 Gross Profit Adjusted EBITDA (and % Margin)1 (and % Margin)1,2 54.7% Year-Over-Year 49.3% Year-Over-Year 56.8% Year-Over-Year Growth Growth Growth $594.4 Includes $7.5 million inventory step-up, a 130 bps headwin
Slide 18: Earnings Per Share-Diluted
Earnings Per Share-Diluted Reconciliation of 2020 1 Adjusted Diluted EPS 42.4% 43.0% 1 Adjusted Diluted Earnings Per Share is a non-GAAP financial measure. The Company excludes, among other items, acquisition related costs, such as business transaction costs, integration expense and non-cash deal am
Slide 19: Balance Sheet & Cash Flow
Balance Sheet & Cash Flow Year-to-date debt pay-down of $21 million; term loan debt at May 30 , 2020, $635.5 million (LIBOR +375 bps) 1 Q3 free-cash-flow generation about $40 million; on target to achieve trailing 12 months Net Debt to Adjusted EBITDA ratio of less than 3.75x by fiscal year-end
Slide 20: Summary
Summary Marketplace trends should improve as movement restrictions and at home confinement eases Anticipate increasing on-the-go and away-from-home usage occasions Channel shifting from large format stores, as well as lower traffic in specialty and convenience store channels, a near term headw
Slide 21: Q&A
Q&A Simply ¥Good FOODS COMPANY”
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