Del Monte Pacific Limited · SGX:D03
Del Monte Pacific — Q2 FY2019 Earnings Presentation
38 slides from Del Monte Pacific's earnings presentation, Dec 13, 2018
Slide 1: 2Q FY2019 Results
T N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® D E L M O NT E PACIFIC 2Q F Y 2 0 1 9 R E S U L T S 13 December 2018 NOURISHING FAMILIES. ENRICHING LIVES. EVERY DAY. ®
Slide 2: Disclaimer
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® DISCLAIMER This presentation may contain statements regarding the business of Del Monte Pacific Limited and its subsidiaries (the “Group”) that are of a forward-looking nature and are therefore based on management’s as
Slide 3: Contents
CONTENTS ▪ Summary ▪ 2Q FY2019 Results ▪ 1H FY2019 Results ▪ Market Updates ▪ Sustainability ▪ Improved Balance Sheet and Cash Flow ▪ Outlook 3
Slide 4: Notes to the 2Q FY2019 Results
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® NOTES TO THE 2Q FY2019 RESULTS ▪ Second quarter is 1 August to 31 October 2018. ▪ DMPL’s effective stake in DMFI is 89.4%, hence the non controlling interest line (NCI) in the P&L. Net income/(loss) is net of NCI. ▪ DM
Slide 5: 2Q and 1H FY2019 Highlights
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® 2Q AND 1H FY2019 HIGHLIGHTS ▪ 2Q net income of US$8.4m reversing the loss of US$2.8m in prior year period, and a net income of US$11.4m for 1H, a turnaround from the US$2.1m loss last year ▪ 2Q sales of US$556m, 6% low
Slide 6: Outlook
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® OUTLOOK ▪ Barring unforeseen circumstances, the Group is expected to be profitable in FY2019 ▪ Major emphasis on responding to consumer trends through: ✓ Strengthening the core business and innovating -- Healthier opti
Slide 7: DMPL 2Q FY2019 Group Results Summary
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® DMPL 2Q FY2019 GROUP RESULTS SUMMARY ▪ Sales of US$556.3m, -11% Sales % Change US -14 Philippines -8 (in peso terms -3) S&W +17 FieldFresh India (equity accounted) +6 (in rupee terms +10) All figures below without one-
Slide 8: DMPL 2Q FY2019 One-off Expense/(Income)
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® DMPL 2Q FY2019 ONE-OFF EXPENSE/(INCOME) In US$ m 2Q FY18 2Q FY19 Booked under Closure of Sager Creek Arkansas plant 6.5 (0.2) Sales/CGS Closure of Plymouth, Indiana plant 14.1 (1.7) G&A/Misc Income Seed operations - (1
Slide 9: DMPL 2Q FY2019 Results – As Reported
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® DMPL 2Q FY2019 RESULTS – AS REPORTED 2Q 2Q In US$m Chg (%) Comments FY2018 FY2019 Mainly due to the planned divestiture of the Sager veg Turnover 624.7 556.3 -11.0 business and lower USA sales. Excluding Sager, sales d
Slide 10: DMPL 2Q FY2019 Turnover Analysis
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® DMPL 2Q FY2019 TURNOVER ANALYSIS 1% 24% Americas 75% Asia Pacific Europe Americas -13.3% ▪ In line with DMFI’s strategy to deprioritise non-profitable businesses, divested the Sager vegetable business and reduced priva
Slide 11: DMPL 1H FY2019 Group Results Summary
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® DMPL 1H FY2019 GROUP RESULTS SUMMARY ▪ Sales of US$993.5m, -10% Sales % Change US -12 Philippines -7 (in peso terms -2) S&W -1 FieldFresh India (equity accounted) +7 (in rupee terms +11) All figures below without one-o
Slide 12: DMPL 1H FY2019 One-off Expense/(Income)
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® DMPL 1H FY2019 ONE-OFF EXPENSE/(INCOME) In US$ m 1H FY18 1H FY19 Booked under Closure of Sager Creek Arkansas plant 6.5 7.2 Sales/CGS Closure of Plymouth, Indiana plant 14.1 (0.8) G&A/Misc Income Seed operations - (1.1
Slide 13: DMPL 1H FY2019 Results – As Reported
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® DMPL 1H FY2019 RESULTS – AS REPORTED 1H 1H In US$m Chg (%) Comments FY2018 FY2019 Mainly due to lower USA sales and the divestiture of the Turnover 1,098.6 993.5 -9.6 Sager veg business. Excluding Sager, sales down 6%
Slide 14: 1H FY2019 Turnover Analysis
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® 1H FY2019 TURNOVER ANALYSIS 2% 25% Americas 73% Asia Pacific Europe Americas -11.5% ▪ In line with DMFI’s strategy to deprioritise non-profitable businesses, divested Sager vegetable business and reduced private label
Slide 15: Market Updates for 2Q FY2019
15 Market Updates for 2Q FY2019
Slide 16: Del Monte Foods Strategy
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® DEL MONTE FOODS STRATEGY Build Relevance: Continually differentiate our brands and products in order to drive consumer preference ▪ Reinforce our points of difference (Del Monte’s quality, College Inn’s rich flavourful
Slide 17: USA
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® USA Market Share (#1) Market Share (#1) Market Share (#2) Market Share (#2) Canned Vegetable Canned Fruit Fruit Cup Snacks Canned Tomato ▪ A brand leader across core categories ▪ Grew share in 2 out of 4 core categorie
Slide 18: Del Monte Foods USA
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® DEL MONTE FOODS USA DMFI’s 2Q sales down 14% to US$418.5m ▪ Stripping out the Sager Creek vegetable business which was divested in September 2017, DMFI sales were down 7% ▪ Lower volume across categories most significa
Slide 19: USA - Innovation
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® USA - INNOVATION Vegetable & Beans College Inn Bone Broth & Mushroom Stock • Launched 4 item line in September 2018 – offering 3-4 grams protein and great tasting • Launched 3 new items in September 2018 source of fibr
Slide 20: USA - Retail Marketing Highlights
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® USA - RETAIL MARKETING HIGHLIGHTS Del Monte Growers of Fruit & Oats Launch Contadina Campaign Print Pinterest Pin Good Launch Digital Social TV/OLV Shopper 100th Anniversary Event Digital OLV Print Digital Ad • New, In
Slide 21: USA - Industry Events
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® USA - INDUSTRY EVENTS PMA NACS • Del Monte participated for the first time in many years at the Perimeter Merchandising Association • The National Association for Convenience Stores (PMA) trade show, October 18-20 in O
Slide 22: USA – Foodservice Highlights
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® USA – FOODSERVICE HIGHLIGHTS Innovation Foundational Efforts Industry Leadership • Distribution is ramping up for new • Sales Territories have been realigned • Introduced new pre-booking Harvest Selects Riced Veggies.
Slide 23: Philippines
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® PHILIPPINES Market Share (#1) Market Share (#1) Market Share (#1) Packaged Pineapple Canned Mixed Fruit Canned and Carton Juices Market Share (#1) Market Share (#1) Tomato Sauce Spaghetti Sauce ▪ Del Monte is the marke
Slide 24: Philippines
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® PHILIPPINES ▪ 2Q sales were down 3% in peso terms but down 8% in US dollar terms due to peso depreciation ▪ Down mainly in the general trade and mixed fruits category as we continue to address operational issues in tha
Slide 25: Philippine Market – 100% Juice Campaign
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® PHILIPPINE MARKET – 100% JUICE CAMPAIGN Del Monte launches its latest “100% Fruitection” campaign to help create excitement for the flagship beverage brand. It will continue to air in both TV and digital platforms thro
Slide 26: Philippine Market – Juice Drink Campaign
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® PHILIPPINE MARKET – JUICE DRINK CAMPAIGN Del Monte Juice Drink launched its “Sari-saring sarap ng real fruit” digital campaign to highlight the brand’s extensive range of flavours made with real fruit, with the goal of
Slide 27: Philippine Market – Pineapple Campaign
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® PHILIPPINE MARKET – PINEAPPLE CAMPAIGN Pina-level up TVC campaign for balance of the year To further grow usage for SUPs in Luzon and VisMin, we are airing 2 new TVCs featuring everyday Pina-level up recipes. Pitch Per
Slide 28: Philippine Market – Health Tie-up
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® PHILIPPINE MARKET – HEALTH TIE-UP Del Monte Fit ‘n Right Active collaboration with fitness trainers Gathering of over 170 of the countries leading Fitness Trainers from different fields. They learned basics concepts of
Slide 29: S&W Asia and the Middle East
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® S&W ASIA AND THE MIDDLE EAST ▪ Consumers moving towards less processed and more natural food: S&W expanding sales of S&W Sweet 16 fresh pineapple ▪ E-commerce and digital are growing with North Asia having the largest
Slide 30: S&W Asia and the Middle East
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® S&W ASIA AND THE MIDDLE EAST ▪ Sales of the S&W business improved by 17% in 2Q due to strong sales of fresh pineapple in North Asia ▪ Offset decline in packaged pineapple due to competition from cheaper canned pineappl
Slide 31: S&W Singapore
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® S&W SINGAPORE New Jollibee store at Jurong East MRT Station. S&W supplies 100% Pineapple Juice in dispenser in all the 6 outlets of Jollibee Singapore. Collaboration with Health Promotion Board for the “Go Lo-Cal” acti
Slide 32: Others
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® OTHERS New S&W Tomato Juice in Alu can being served on Singapore Airlines flights Launched College Inn Chicken Broth from USA in Park N Shop Hong Kong on October 5 32
Slide 33: FieldFresh India
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® FIELDFRESH INDIA ▪ FieldFresh sales were up 10% in 2Q due to higher Del Monte packaged sales ▪ Launched new variants to our Dried Fruit range ▪ DMPL’s share of profit was US$0.01 million, up 19% versus the prior year q
Slide 34: India – New Product Introductions
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® INDIA – NEW PRODUCT INTRODUCTIONS This quarter saw the addition of 3 new variants to October saw the relaunch of our Gourmet our Dried Fruit range pasta sauces 1. Nutty Cruiser Trail Mix (50g & 250g): A delicious 1. Ra
Slide 35: India – Others
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® INDIA – OTHERS Pasta Sauce launch - Banners Standees/Window branding 2018 range of Del Monte Fruit Drink gift packs Festive gifting around the festival of Diwali presents a tactical business and brand exposure opportun
Slide 36: Sustainability
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® SUSTAINABILITY ▪ Published DMPL’s first Sustainability Report for FY2018 in October based on SGX guidelines and Global Reporting Initiative reporting framework ✓ Uploaded on DMPL’s website ✓ Created and uploaded a 2-1/
Slide 37: Improved Balance Sheet and Cash Flow
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® IMPROVED BALANCE SHEET AND CASH FLOW ▪ Committed to improve cash flow, reduce debt and interest expense ▪ Raised US$300m from two Preference Share tranches in April and December 2017 to repay loans ▪ In 4Q and 1Q, DMPL
Slide 38: Outlook
N O U R I S H I N G FA M I L I E S . E N R I C H I N G L I V E S . E VE RY DAY. ® OUTLOOK ▪ Barring unforeseen circumstances, the Group is expected to be profitable in FY2019 ▪ Major emphasis on responding to consumer trends through: ✓ Strengthening the core business and innovating -- Healthier opti