Slide 1: Second Quarter 2022 Earnings Call
Second Quarter 2022 Earnings Call Jim Zallie President and CEO James Gray Executive Vice President and CFO
Slide 2: Non-GAAP Financial Measures and Forward-Looking Statements
Non-GAAP Financial Measures This presentation provides information about adjusted diluted earnings per share (“adjusted EPS”), adjusted operating income, adjusted effective income tax rate, and other financial measures (collectively, the “non- GAAP financial measures”) which are not measurements of
Slide 3: CEO Perspective
Jim Zallie President and CEO Second Quarter 2022 Earnings Call CEO Perspective 3
Slide 4: Agenda
Agenda • CEO Perspective • CFO Financial Update • Advancing the DRIVINGROWTH Roadmap • Questions & Answers Specialty Growth Platforms STARCH-BASED CLEAN AND SIMPLE PLANT-BASED SUGAR REDUCTION FOOD TEXTURIZERS INGREDIENTS PROTEINS AND SPECIALTY SYSTEMS SWEETENERS 4
Slide 5: Q2 2022: Outstanding top-line performance outpaced higher input costs
Q2 2022: Outstanding top-line performance outpaced higher input costs Second Quarter Second Quarter Net Sales Adjusted Op Income +16% +3% Absent FX impacts Absent FX impacts +18% +7% 5
Slide 6: Strong and consistent net sales performance in Q2
Strong and consistent net sales performance in Q2 North America South America Asia-Pacific EMEA +20% +42% +11% +10% Comparable* region growth Absent FX Impacts 21% 38% 19% 24% 8% reported growth, reflects Argentina JV volume impact 6 *South America comparable net sales excludes Argentina JV volume i
Slide 7: Q2 2022 shipped volumes have returned to pre-COVID levels
Q2 2022 shipped volumes have returned to pre-COVID levels on a comparable basis +37.2% Net Sales ($ Millions) $2,043 $1,699 $1,489 $1,294 Q2 2019 Q2 2020 Q2 2021 Q2 2022 Shipped Volume Index* 100% 84% 98% 101% 7 *Shipped Volume Index presents on comparable basis and excludes coproducts, Ethanol volu
Slide 8: Strengthening our strategic pillars in Q2 2022
Strengthening our strategic pillars in Q2 2022 Specialties Growth Commercial Excellence Cost Competitiveness through Operational Excellence • Global Specialties net sales grew • Implemented automation of • Expanded commodity risk mid-double digits order receiving, product coverage to further mitigat
Slide 9: Accelerating Our Purpose Driven and People-Centric Growth Culture
Accelerating Our Purpose Driven and People-Centric Growth Culture • 2021 global sustainability report, “Making Life Better,” details our progress against our 2030 goals Committed to advancing regenerative agriculture Achieve 25% practices by sustainably reduction in GHG sourcing 100% of corn, emissi
Slide 10: YTD Specialties showed very strong double-digit growth across all four regions
YTD Specialties showed very strong double-digit growth across all four regions NORTH +20% AMERICA vs 8% in 2021 ASIA-PACIFIC +13% EUROPE, MIDDLE vs 40% in 2021 EAST AND AFRICA Growth in starch-based texturizers and clean Growth in tapioca and and simple ingredients rice-based starch-based texturizer
Slide 11: PureCircle momentum continues
PureCircle momentum continues • Sugar Reduction and Specialty Sweetener up strong double-digits • PureCircle customer wins driving results • 28% Q2 net sales growth over prior year • Positive operating income • Increased ownership from 75% to 82% during the quarter 11
Slide 12: Navigating a challenging business landscape
Navigating a challenging business landscape Pandemic Recovery Ukraine Conflict Inflation Supply chain Energy FX and labor 12
Slide 13: CFO Perspective
James Gray Executive Vice President and CFO Second Quarter 2022 Earnings Call CFO Perspective 13
Slide 14: Q2: Regional performance: North America and South America
Q2: Regional performance: North America and South America North America South America Net Sales +20% Net Sales $1,284 $1,068 +8% $268 $290 2021 2022 2021 2022 • Strong price mix leading to 20% net sales growth • Up 6% excluding foreign currency impacts • Up 21% excluding foreign currency impacts • U
Slide 15: Q2: Regional performance: Asia-Pacific and EMEA
Q2: Regional performance: Asia-Pacific and EMEA Asia-Pacific EMEA Net Sales Net Sales +11% 33% $275 +10% $248 $178 $195 2021 2022 2021 2022 • Up 19% excluding foreign currency impacts • Up 24% excluding foreign currency impacts Operating Income Operating Income • $21 million, down $3 million • $29 m
Slide 16: Q2 Highlights: Income statement
Q2 Highlights: Income statement $ in millions, unless noted Q2 2021 Q2 2022 Change Net Sales $1,762 $2,044 +16% Gross Profit $367 $390 +6% Gross Profit Margin 20.8% 19.1% (170)Bps Reported Operating Income $222 $213 $(9) Reported Diluted EPS $2.62 $2.12 $(0.50)/share Adjusted Operating Income* $208
Slide 17: Q2: Net Sales bridge
Q2: Net Sales bridge Strong growth demonstrating excellent price management +16% $ in millions $328 $2,044 $1,762 $(41) $(5) Q2 2021 FX Volume Price/Mix Q2 2022 17 Totals may not foot due to rounding
Slide 18: Q2: Net Sales variance by region
Q2: Net Sales variance by region Foreign Net Sales Volume Price Mix Exchange Change North America -1% 1% 20% 20% South America* 2% -12% 18% 8%** Asia-Pacific -8% 4% 15% 11% EMEA -14% 4% 20% 10% Ingredion* -2% 0% 18% 16% Totals may not foot due to rounding 18 *Reported net sales above include present
Slide 19: Q2: EPS bridge
Q2: EPS bridge Amounts are dollars/share Margin $ 0.24 Volume** (0.11) 2021 Reported Diluted EPS $ 2.62 Foreign Exchange Rates (0.07) Restructuring/Impairment Costs 0.03 Other Income 0.01 Acquisition/Integration Costs 0.02 Changes from Operations $ 0.07 Tax and other matters (0.62) 2021 Adjusted Dil
Slide 20: YTD highlights: Income statement
YTD highlights: Income statement $ in millions, unless noted YTD 2021 YTD 2022 Change Net Sales $3,376 $3,936 +17% Gross Profit $718 $769 +7% Gross Profit Margin 21.3% 19.5% (180) bps Reported Operating Income $52 $423 $371 Reported Diluted EPS $(1.01) $4.04 $5.05/share Adjusted Operating Income* $4
Slide 21: YTD: Net Sales bridge
YTD: Net Sales bridge $ in millions +17% $612 $3,936 $3,376 $14 $(66) YTD 2021 FX Volume Price/Mix YTD 2022 21 Totals may not foot due to rounding
Slide 22: YTD: EPS bridge
YTD: EPS bridge Amounts are dollars/share Margin $ 0.44 2021 Reported Diluted EPS $ (1.01) Volume (0.13) Acquisition/Integration Costs $ 0.02 Impairment/Restructuring Costs $ 0.15 Foreign Exchange Rates (0.11) Impairment** $ 5.35 Other Income 0.02 Other Matters $(0.58) Changes from Operations $ 0.22
Slide 23: Cash used for operations and cash deployment
Cash used for operations and cash deployment $ millions Net Income $278 Depreciation and amortization $107 Working capital $(454) Other $65 Cash used for operations $(4) Cash deployment Capital expenditures, net $(137) Dividend payments, including to non- $(90) controlling interests Repurchases of c
Slide 24: Updating Full Year 2022 adjusted EPS expectations
Updating Full Year 2022 adjusted EPS expectations 2022 • Anticipated 2022 adjusted EPS* $6.90 to $7.45; excluding acquisition-related Full year integration and restructuring costs, as well as any potential impairment costs • Expect net sales to be up mid-double-digits • Expect adjusted operating inc
Slide 25: 2022 Full year regional outlook and Q3 preview
2022 Full year regional outlook and Q3 preview North • Expect net sales to be up 15% - 20% 2022 vs. America • Expect operating income to be up low to mid-double digits 2021 • Expect net sales to be up low double-digits South • Expect operating income to be up low double-digits America • Reflects rep
Slide 26: Our roadmap for value creation
Our roadmap for value creation DRIVINGROWTH Customer CustomerCo-Creation Co-Creation and Consumer ConsumerPreferred Preferred Innovation Innovation Specialty Growth Platforms VALUE CREATION VALUE CREATION STARCH-BASED CLEAN AND SIMPLE PLANT-BASED SUGAR REDUCTION FOOD TEXTURIZERS INGREDIENTS PROTEINS
Slide 27: Q&A
We bring the potential of people, nature and technology together to make life better. Q&A
Slide 28: Upcoming Investor Activities
Upcoming Investor Activities Barclays Consumer Staples Conference September 6, 2022 Morningstar Behind the Moat Conference September 7, 2022 Baird Global Industrial Conference November 8, 2022 Stephens Annual Investment Conference November 15, 2022 28
Slide 29: Appendix
Appendix NN Ingredion Be what's next.
Slide 30: Non-GAAP Information
Non-GAAP Information To supplement the consolidated financial results prepared in accordance with U.S. generally accepted accounting principles (“GAAP”), we use non-GAAP historical financial measures, which exclude certain GAAP items such as acquisition and integration costs, restructuring and impai
Slide 31: Reconciliation of GAAP net income and diluted EPS to non-GAAP adjusted
Reconciliation of GAAP net income and diluted earnings per share (EPS) to non-GAAP adjusted net income and adjusted diluted EPS Three Months Ended Three Months Ended Six Months Ended Six Months Ended June 30, 2022 June 30, 2021 June 30, 2022 June 30, 2021 (in millions) Diluted EPS (in millions) Dilu
Slide 32: Reconciliation of GAAP net income and diluted EPS (continued)
Reconciliation of GAAP net income and diluted earnings per share (EPS) to non-GAAP adjusted net income and adjusted diluted EPS (continued) Notes (i) During the six months ended June 30, 2022, we recorded $1 million of pre-tax acquisition and integration charges related to our acquisition and integr
Slide 33: Reconciliation of GAAP operating income to non-GAAP adjusted operating income
Reconciliation of GAAP operating income to non-GAAP adjusted operating income Three Months Ended Six Months Ended June 30, June 30, (in millions, pre-tax) 2022 2021 2022 2021 Operating income $ 213 $ 222 $ 423 $ 52 Add back: Acquisition/integration costs (i) - (3) 1 (2) Restructuring/impairment char
Slide 34: Reconciliation of GAAP effective income tax rate to non-GAAP adjusted
Reconciliation of GAAP effective income tax rate to non-GAAP adjusted effective income tax rate Three Months Ended June 30, 2022 Six Months Ended June 30, 2022 Income before Provision for Effective Income Income before Provision for Effective Income (in millions) Income Taxes (a) Income Taxes (b) Ta
Slide 35: Reconciliation of GAAP effective income tax rate, cont'd
Reconciliation of GAAP effective income tax rate to non-GAAP adjusted effective income tax rate, cont’d Three Months Ended June 30, 2021 Six Months Ended June 30, 2021 Income (Loss) before Provision for Effective Income Income before Provision for Effective Income (in millions) Income Taxes (a) Inco
Slide 36: Reconciliation of anticipated GAAP diluted EPS to adjusted diluted EPS
Reconciliation of anticipated GAAP diluted earnings per share to anticipated non-GAAP adjusted diluted earnings per share Expected EPS Range for Full-Year 2022 Low End of High End of Guidance Guidance GAAP EPS $ 6.95 $ 7.35 Add: Acquisition/integration costs (i) 0.01 0.01 Restructuring/impairment ch
Slide 37: Reconciliation of GAAP effective tax rate to anticipated adjusted rate
Reconciliation of reported GAAP effective tax rate to anticipated non-GAAP adjusted effective income tax rate Expected Effective Tax Rate Range for Full-Year 2022 Low End of High End of Guidance Guidance GAAP ETR 27.0 % 29.5 % Add: Acquisition/integration costs (i) - % - % Restructuring/impairment c