The Hershey Company · NYSE:HSY
The Hershey — Hershey — Shareholder Meeting (May 2021)
46 slides from The Hershey's shareholder meeting presentation, May 17, 2021
Slide 1: Annual Meeting of Stockholders May 17, 2021
POP & we PS ANNUAL MEETING OF STOCKHOLDERS MAY 17, 2021
Slide 2: Agenda: Items of Business
AGENDA ITEMS OF BUSINESS er
Slide 3: Election of Directors
ELECTION OF DIRECTORS LT isn:
Slide 4: Nominated Directors
NOMINATED DIRECTORS Pamela Arway Diane Koken James Brown Robert Malcolm Victor Crawford Anthony Palmer Robert Dutkowsky Juan Perez Mary Kay Haben Wendy Schoppert James Katzman Michele Buck 2s
Slide 5: Board Recommendation
BOARD RECOMMENDATION The Board recommends a vote FOR each of the director nominees es
Slide 6: Ratification of Appointment of Independent Auditors
RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITORS LTTE isn:
Slide 7: Board recommends a vote FOR ratification of Ernst & Young
The Board recommends a vote FOR ratification of the appointment of ERNST & YOUNG LLP as independent auditors for the fiscal year ending December 31, 2021. es
Slide 8: Advise on Named Executive Officer Compensation
ADVISE ON NAMED EXECUTIVE OFFICER COMPENSATION
Slide 9: Board Recommendation
BOARD RECOMMENDATION The Board recommends a vote FOR approval, on a non-binding advisory basis, of the Company’s named executive officer compensation LT isn:
Slide 10: Voting
VOTING es
Slide 11: Agenda
AGENDA ee
Slide 12: Forward-Looking Statements
FORWARD-LOOKING STATEMENTS This presentation contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Many of these forward-looking statements can be identified by the use of
Slide 13: Slide 13
Slide 14: Strategies to Sustain Our Momentum and Deliver
STRATEGIES TO SUSTAIN OUR MOMENTUM AND DELIVER S S . i making 71022 moments of goodness « AGAINST OUR PURPOSE A DYNAMIC WORKFORCE LEADING US deliver peer-leading SHAREHOLDER RETURNS 14 HERSHEY
Slide 15: A Growing Portfolio of Beloved Brands
A GROWING PORTFOLIO OF BELOVED BRANDS
Slide 16: Hershey
HERSHEY
Slide 17: Strong U.S. Share Positions
STRONG U.S. SHARE POSITIONS Gained Skinny Pop in Confection, . # 5 MILLION households gained 3.5 MILLION households 1 32% market share in 2020 ante acauititon cHocoate «=—i(tsiéiCi‘(<ié‘éCSCSCSCSYRUP He POPCORN ~ #1, 46% P #1, 79% fe #2, 20% MINT BAKING POWDER a BETTER-FOR-YOU PUFFS #1, 35% y a #1,6
Slide 18: Investing in the Core
S S ™~ (esting, \N THE CORE MARKETING SUPPORT INNOVATION SEASONS SHARE: >8% OF NET SALES = a 9.7% sousenoun BRANDS SUPPORTED 24 eg is PARTICIPATING DISTRIBUTION E-COMMERCE FOOTBALL F MPANY 1,000 feicscrnw =~5% sairs PRICE REALIZATION
Slide 19: Diversifying to Capture Profitable Growth
DIVERSIFYING TO CAPTURE PROFITABLE, PERMISSIBLE INDULGENCE SNACKING __ INTERNATIONAL ‘Thins Platform Expansion New Skinny Pop & Accelerate Growth In a Pirate’s Campaigns _ India/Mexico Zero Sugar Platform Nutrition Bar Expansion Seed Growth In Europe/Asia_ Hershey Organic Launch i Targeted Snack Cak
Slide 20: Unmatched Capabilities Connecting Us to Consumers
UNMATCHED CAPABILITIES CONNECTING US TO CONSUMERS ee ee
Slide 21: Real-Time Data, AI and #1 in Media Investment
REAL-TIME DATA, Al #1 IN MEDIA INVESTMENT amongst food peers #1 RANKED TEAM in Category Management and DIFFERENTIATED #1 SHARE IN STORE & ON-LINE Business Relationships AND SUPERIOR # 1 RANKED TEAM by Store Managers and Employees #1 RANKED TEAM In Customer Service HED CAPABILITIES » @ 5 4 HERSHEY
Slide 22: S'mores Time for Family and Friends
S’MORES TIME FOR FAMILY AND FRIENDS Enjoy the backyard .s’more! yj RETAIL SALES +4% 40M CATEGORY HOUSEHOLDS SHARE Bm +5M +350bps | q _4 22 UNMATCHED CAPABILITIES » @ 5 4 ws HERSHEY"
Slide 23: Investing and Adapting for Future Growth
INVESTING AND ADAPTING FOR FUTURE GROWTH TECHNOLOGY & ANALYTICS ERP Category Management Addressable Media Agile Fulfillment Omni-Channel Activation Revenue Management Incremental Capacity ATCHED CAPABILITIES » @ 5 @ HERSHEY
Slide 24: A Dynamic Workforce Leading Us Forward
A DYNAMIC WORKFORCE LEADING US FORWARD ey ee
Slide 25: Driving Business Transformation Dynamic Workforce
DRIVING BUSINESS TRANSFORMATION 25 DYNAMIC WORKFORCE, ® 5, 4 HERSHEY
Slide 26: The Long-Term View Guiding Our Growth
THE LONG-TERM VIEW GUIDING OUR GROWTH ee ee
Slide 27: "Doing Well by Doing Good"
“DOING WELL BY DOING GOOD” - Milton S. Hershey Ine @ Ld AMERICA’S MOST RESPONSIBLE COMPANIES y | 2020 statista%a [ q ) a Dow Jones Sustainability Indexes
Slide 28: Community Investment
~ HERe +30% Mase ex prolamin Take one with Xx xitKal C) 1 | ‘ : : } 28 Srille HERSHEY
Slide 29: Strong Progress Against Our ESG Agenda
STRONG PROGRESS AGAINST OUR ESG AGENDA RESPONSIBLE SOURCING ke ENVIRONMENT 2 OO ,—CON— 100% certified cocoa 100% of priority ingredients responsibly and sustainably sourced Announced Science Based Targets Established packaging sustainability commitments 4 fe e HUMAN CAPITAL COMMUNITY Achieved aggreg
Slide 30: Announced New Environmental Commitments
ANNOUNCED NEW ENVIRONMENTAL COMMITMENTS Reduce Scope 1 & 2 Emissions by 50% Reduce Scope 3 Emissions by 25% 100% of plastic packaging to be recyclable, reusable, or compostable Reducing packaging weight by an additional 25M Ibs Eliminate deforestation from ingredient supply chains SUSTAINABILITY REP
Slide 31: Delivering Peer-Leading Financial Returns
DELIVERING PEER-LEADING FINANCIAL RETURNS Ne x.
Slide 32: Strategy Is Working, Good Momentum
a STRATEGY IS WORKING, GOOD MOMENTUM A DYNAMIC THE LONG- WORKFORCE TERM VIEW LEADING US GUIDING OUR FORWARD GROWTH DELIVERING AGAINST OUR LONG-TERM ALGORITHM 2019 2020. = Q1. 2021 2-4% NET SALES GROWTH 6-8% ADJUSTED EPS GROWTH 22 PEER-LEADING FINANCIAL RETURNS » @y @ HERSHEY
Slide 33: High-Quality 2020 Earnings via Balanced, Multi-Lever Approach
HIGH-QUALITY 2020 EARNINGS VIA BALANCED, MULTI-LEVER APPROACH Pricing 2020 Financials Vol — Gains ~ eee 45.5% Growth os +2.0% Organic, Constant Currency North Ametica Gross Margin Net Sales Growth egmen Adjusted EPS — Diluted (0) +8.8% Growth +159bps +50bps $1.7B Operating Cash Flow are gains in U.S
Slide 34: Healthy Cash Flow Fuels Financial Flexibility
HEALTHY CASH FLOW FUELS FINANCIAL FLEXIBILITY Operating Cash Flow $ Millions $1,700 FINANCIAL FLEXIBILITY $1,013 2016 2017 2018 2019 2020 34 PEER-LEADING FINANCIAL RETURNS » @y 4 HERSHEY
Slide 35: Proven Track Record of Returning Cash to Shareholders
35 PROVEN TRACK RECORD OF RETURNING CASH TO SHAREHOLDERS ow 4,4 — DIVIDEND PAYOUT RATIO SHARE REPURCHASES > © 52% J sui08N 0 average over past five years cumulatively over past five years” Committed to a dividend payout Plan to return to historical share ratio of at least 50% repurchases strategies
Slide 36: Creating Shareholder Value Over Long-Term
CREATING SHAREHOLDER VALUE OVER LONG-TERM 10-Year Total Shareholder Return Hershey 45% CPG Food* S&P 500 36 PEER-LEADING FINANCIAL RETURNS » @y 4 HERSHEY
Slide 37: Strategies to Deliver Sustainable, Advantaged Results
STRATEGIES TO DELIVER SUSTAINABLE, ADVANTAGED RESULTS S S . i making 71022 moments of goodness « A DYNAMIC WORKFORCE LEADING US deliver peer-leading SHAREHOLDER RETURNS 37 PEER-LEADING FINANCIAL RETURNS » @y @ HERSHEY
Slide 38: Agenda: Questions and Answers
AGENDA QUESTIONS AND ANSWERS ee
Slide 39: Questions & Answers
Uy QUESTIONS & ANSWERS # KEEP QUESTIONS BRIEF | LIMIT TO ONE TOPIC *All questions and answers will be posted on the Investor Relations website by May 24**, including those we are unable to get to during the live meeting today. 39
Slide 40: Agenda: Voting Results
AGENDA VOTING RESULTS ee
Slide 41: Hershey
HERSHEY. er
Slide 42: Appendix
APPENDIX HERSHEY<
Slide 43: Reconciliation of GAAP and Non-GAAP Information, 2020
APPENDIX Reconciliation of GAAP and Non-GAAP Information For the year ended December 31, 2020 Income Gross Operating Interest Net Per Share- In millions of dollars except per share amounts Profit Profit Expense, net Income Diluted GAAP results $ = 3,701.3 $ 1,782.7 $ 149.4 $ 1,278.7 $ 611 Adjustment
Slide 44: Appendix: Margins, year ended December 31, 2020
APPENDIX For the year ended December 31, 2020 As reported gross margin 45.4% Non-GAAP gross margin (1) 45.5% As reported operating profit margin 21.9% Non-GAAP operating profit margin (2) 22.5% (1) Calculated as non-GAAP gross profit as a percentage of net sales for the period presented. (2) Calcula
Slide 45: Reconciliation of GAAP and Non-GAAP Information, 2019
APPENDIX Reconciliation of GAAP and Non-GAAP Information For the year ended December 31, 2019 Income Gross Interest Net Per Share- In millions of dollars except per share amounts. Profit Expense, net Income Diluted GAAP results $ 3,622.5 $ 1,596.0 $ 1441 $ 1,149.7 $ 546 Adjustments: Derivative mark-
Slide 46: Appendix: Margins, year ended December 31, 2019
APPENDIX For the year ended December 31, 2019 As reported gross margin 45.4% Non-GAAP gross margin (1) 45.0% As reported operating profit margin 20.0% Non-GAAP operating profit margin (2) 21.1% (1) Calculated as non-GAAP gross profit as a percentage of net sales for the period presented. (2) Calcula