Download - SNAK Jan 2016 Investor Presentation
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Inventure
FoodsICR ConferenceJanuary 12, 2016
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Statements contained in this presentation that are not historical facts are forward-looking
statements as that term is defined in the Private Securities Litigation Reform Act of 1995.
Because such statements include risks and uncertainties, actual results may differ materially from
those expressed or implied by such forward-looking statements. Factors that may cause actual
results to differ from the forward-looking statements contained in this presentation and that mayaffect the Company's prospects in general include, but are not limited to, general economic
conditions, increases in cost or availability of ingredients, packaging, energy and employees, price
competition and industry consolidation, ability to execute strategic initiatives, product recalls or
safety concerns, disruptions of supply chain or information technology systems, customer
acceptance of new products and changes in consumer preferences, food industry and regulatory
factors, interest rate risks, dependence upon major customers, dependence upon existing and
future license agreements, the possibility that we will need additional financing due to futureoperating losses or in order to implement the Company’s business strategy, acquisition-related
risks, the volatility of the market price of the Company’s common stock, and such other factors as
are described in the Company's filings with the Securities and Exchange Commission.
Forward Looking Statements
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About Us
Shares Outstanding: 19.6 million
Market Cap: ~$140 million
Stock Price (as of 12/31/15): $7.10
52 week range: $6.57-$13.08
2014 Adjusted EPS: $0.47 (diluted)
Company Founded: 1983
Public Since: 1996
Headquarters: Phoenix, Arizona
Healthy Snacks
Premium Private Label
Frozen Fruit
Frozen Beverages Indulgent Snacks
Frozen Vegetables
LISTED
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Investment Highlights
Consistent organic growth in revenue and earnings
Innovative marketer of healthy / natural and indulgent specialty food brands with
state-of-the-art facilities
Strong portfolio of national brands
Diversified product portfolio and distribution channels of branded and private labelfruit and snacks
Seasoned management team with backgrounds at global CPG companies
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$9.9
$16.0$18.0
$24.9
$16.9 $14.7
2011 2012 2013 2014 First 9Months
2014
First 9Months
2015
Revenue
Financial & Investment Highlights
EBITDA
$162.2$185.2
$215.6
$285.7
$168.7$182.2
2011 2012 2013 2014 First 9Months
2014
First 9Months
2015
(c.)
($ in millions)
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(a.) Adjusted for gain on sale of DSD business
(b.) Adjusted for acquisition-related transaction costs(c.) Adjusted for Fresh Frozen contingent consideration, Jamba litigation settlement, and offering costs
(d.) Excludes Fresh Frozen
(e.) Excludes costs associated with the product recall, Boulder capacity constraints and estimated business interruption costs associated with the product recall
(b.)(a.)
($ in millions)
Historical 5-Year Stock Performance
(d.) (e.)(d.)(c.)
$7.10
$0.00
$2.00
$4.00
$6.00
$8.00
$10.00
$12.00
$14.00
$16.00
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2015 Issues
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Frozen Vegetable Recall
Announced April 2015
Significant impact on sales and earnings
Status:
Plant up and running at the end of June 2015
No illness reported from any consumers
Maintained 95% of customers
Slowly ramping sales to pre-recall velocity
Added additional costs
Boulder Canyon Capacity
The success of the brand caused a short term capacity issue at the kettle chip plant
Used outside co-packers at an incremental cost of $1.5mm per quarter starting in Q2
Status:
Four new kettles being installed at our Kettle chip plant and will be up and running by January 2016
Four additional kettles scheduled for the back half of 2016 at the Bluffton Indiana plant as Boulder expands east
Declining Fruit Margins
Reduced crop yield in the summer will affect fruit margins in 2016
Status:
Building our “value added” fruit business
Focusing on cost reduction projects to mitigate the margin issue
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2016 Outlook
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Boulder Canyon
Capacity issues will have been resolved
Expect to continue revenue growth
Expect to continue significant new product introductions
Frozen Vegetables Implementing bold moves in 2016 to increase margins
Upgraded the Operations team at the Jefferson facility
Frozen Fruit
Focusing on continuing the momentum on the Rader brand in 2016.
Focusing on building “value-added” fruit products (ie. Fresh Start)
Focusing on margin enhancement projects
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Financing Update
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On November 23rd
, SNAK completed a $135 million debt refinancing
– Includes a new five-year, $50 million senior-secured revolving credit facility and a new five-
year $85 million senior secured term loan facility, both of which mature on November 17,
2020
These facilities, in conjunction with the company’s cash flow from operations,expected to adequately meet capital requirements for future growth over the next
several years
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Sales Growth Across Brands
2014 Net Revenue of $285.7 million, up 33%
First Nine Months 2015 Net Revenue of $213.9 million, up from $211.9
Excluding the Fresh Frozen business, net revenues would have increased 8%
Frozen Berries
Frozen Vegetables
Jamba All-Natural Smoothies
National Licenses
Regional Brands
Healthy Natural84% of Net Sales
Indulgent Specialty16% of Net Sales
Better-For-You Snacks
Premium Private Label
Premium Private Label
Private Label
LicenseeLicenseeLicensee Private Label
Licensee Private Label Private Label
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Innovative New Products 2014
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Innovative New Products 2015
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Specialized Facilities
Lynden, WA
Willamette, OR
Goodyear, AZ
Bluffton, IN
Jefferson, GA
Thomasville, GA
Frozen Facilities
Snack Facilities
Inventure Manufacturing Locations
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Diverse Distribution Channels
Broad and growing distribution across grocery, natural, mass, convenience and foodservice channels
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Seasoned Leadership Team
Strong executive management team from top-tier consumer packaged good companies with
average leadership tenure of 7 years
Name Title
Years at
Inventure Foods
Industry
Experience Relevant Experience
M a n a g e m e n t
Terry McDaniel Chief Executive Officer 9+ Years 30+ Years
Steve Weinberger Chief Financial Officer 9+ Years 30+ Years
Steven Sklar GM Snack Division 10+ Years 25+ Years
Dan Hammer GM Frozen Division 1+ Year 30+ Years
N e w A d d i t i o n s
t o t h e
B o a r d o f D i r e
c t o r s
David Meyers Board Chairman 2+ Years 35+ Years
Harold Edwards Board Director 2+ Years 20+ Years
Paul Lapadat Board Director 2+ Years 20+ Years
Tim Cole Board Director 2+ Years 30+ Years
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http://www.theschwanfoodcompany.com/default.htmhttp://www.theschwanfoodcompany.com/default.htmhttp://logodatabases.com/general-mills-logo.html/general-mills-logo-2012http://logodatabases.com/general-mills-logo.html/general-mills-logo-2012
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Trends in Healthy Eating
(1) SPINSscan Natural (proprietary), SPINSscan Conventional Multi Outlet TPL (powered by IRI). 52 weeks ending 10/5/2014.(2) SPINS 52 week data ending 11/1/15.
(3) IRI Multi-Outlet 52 week data ending 11/1/15.15
Frozen fruit category
increased
9.4%(3)
The Natural snack
channel grew
16.1%(2)
Dollar sales of natural and organic products are expected to reach more than $100 billion in the USin 2015 with a growing number of retailers increasing product selection to meet consumer demand.(1)
Healthier foods are snatching up dollar share.
Natural and organic now represents nearly 6% of Conventional Multi Outlet total channel dollar sales.
While that’s just a fraction of the 82% dollar share these products get in Natural Supermarkets, the
number rises each year.(1)
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Frozen Fruit and Smoothies
2014 Net revenues up 9.5%
First Nine Months 2015 Net revenues up 11.8%
Strong frozen fruit branded and private label sales
Successful launch of new Jamba Fusion line-up of blended fruits and vegetables, including: Green Fusion,
Blue Fusion, Red Fusion and Organics
Market leading: Jamba dollar share of frozen beverage category is 46.9%(1)
Launched new “Steamables” product in early 1Q15
Successful launch of Fresh Start line
Rader FarmAcquisition
Jamba At-Home
Smoothies
AdditionalJamba SKUs
WillametteAcquisition
Fresh FrozenAcquisition
2007 2010 2012 2013
Frozen Segment Innovation Timeline
(1) IRI US Foods Channel data 52 weeks ending 11/1/15.16
Jamba FusionJamba
OrganicFresh Start
2014 2015 2016
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Boulder Canyon Brand
2014 Net revenues up 70.3%
First Nine Months 2015 Net revenues up 38.2% 5 year CAGR 24.5%
Gluten Free / GMO Free / Healthy Oils
Highly extendable brand that can be leveraged into adjacent
product categories
Increased brand investment support
Strong dedicated sales and marketing team New flavors and concepts introduced in 2014 and 2015
New line of better for you popcorn available late 2016
Boulder Canyon Innovation Timeline
Boulder CanyonAcquisition
Rice & AdzukiBean Chip
CompostablePackaging
Garden SelectVegetable
Crisps
New Boulder Canyon Flavors
2000 2011 2012 2013 and 20142009
US Foods(52 weeks ending 11/1/15)
IRI Potato Chip Category +2.8%
Boulder Canyon +42.4%(12 weeks ending 11/1/15)
IRI Potato Chip Category +2.6%
Boulder Canyon +32.1%
SPINS(12 weeks ending 11/1/15)
SPINS Potato Chip category +15.7%
Boulder Canyon +57.8%
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Coconut Oil
Popcorn
2015
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Frozen Vegetables
Portfolio diversification: Frozen vegetables are a $4.4 billion
category Full-service processor and supplier of 60 varieties of frozen
vegetables and fruits
Year-round freezing operations in Southeast and ability to freeze
strawberries and other fruits in new region
Accretive to earnings in 2014
Began to capitalize on synergy opportunities in sales, operationsand logistics
Launched new “Steamables” product in early 1Q15
US Foods(Pre-Recall / 52 weeks ending
4/19/15)
IRI Frozen Vegetable Category -
0.8%
Fresh Frozen +11.4%
(1) Wall Street Journal: “See Through Food Packaging Boosts Sales.”
“Clear packaging givesproducts an aura of being
natural, something that
more shoppers are
seeking(1)”
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Premium Private Label Brands
Unique premium private label products offer a distinct competitive advantage and
additional sell-through opportunities for branded products
Illustrative Customers
5.2%
47.4%
39.0%
2013 2014 First 9
Months
2015
Healthy / Natural Private Label Sales Increase
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Distribution Growth Opportunities
Key Brands
Channels
Grocery(1)37% ACV Less than 20% ACV Less than 20% ACV
Natural(2) 82% ACV
Mass
Drug
Club
Convenience
(1) IRI US Foods Channel data 52 weeks ending 11/1/15.
(2) SPINS Natural Channel 52 weeks ending 11/1/15.20
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Recent Accolades
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Circ: 2,395,496
Circ: 2,872,944
Circ: 8,615,404
Circ: 1,708,387Featured in
November 3rd
issue of
Forbes; named
as innovators
in the “Futureof Snacktime” Named to 2014
Forbes List of
“America's Best Small
Companies”
for third year
Circ: 4,072,592
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Recent Accolades: 2015 Highlights – Jamba
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Total of 28 placements, resulting in 1,360,271
impressions
• 10 print (187,374 impressions)
• 3 online (19,919 impressions)
• 9 blogs (197,474 UVPM)
• 6 National TV (955,504 viewers)• 203 Regional TV (15.6M audience)
Trade/channel
awareness
6 national airings
955,000 viewers
203 regional
airings
149 markets
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Recent Accolades: 2015 Highlights – Rader Farms
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Total of 17 placements, resulting in
779,210 impressions
• 10 print (298,133 impressions)
• 3 online (151,579 impressions)• 6 blogs (465,498 UVPM)
• 264 Regional TV (9.5M audience)
264 regional airings
164 markets
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Investment Summary
Strong growth potential with consistent revenue and earnings growth performance
Continued distribution gains and participation in high growth categories
Plans to leverage diverse distribution channels to spur ACV growth across brands to
allow for enhanced market share
Develop new technology to fuel growth
Expand product portfolio to take advantage of consumers’ desire for frozen fruits,
frozen vegetables and snacks
Difficult 2015 but poised to return to growth in 2016
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www.inventurefoods.com