Nomad Foods Limited · NYSE:NOMD
Nomad Foods — Morgan Stanley Global Consumer and Retail Conference 2015
37 slides from Nomad Foods's conference presentation, Nov 17, 2015
Slide 1: Morgan Stanley Global Consumer and Retail Conference
Morgan Stanley Global Consumer and Retail Conference November 17, 2015 1
Slide 2: Disclaimer
Disclaimer This presentation has been prepared and issued by Nomad Foods Limited (the "Company"). This Presentation has been provided solely for information and background. The information in this Presentation is provided as at the date of the Presentation (unless stated otherwise). This Presentatio
Slide 3: Today's Presenters
Today's Presenters Stéfan Descheemaeker, CEO Paul Kenyon, CFO 3
Slide 4: Agenda
Agenda Introduction to Nomad Foods Growth and Value Creation Platform and Market Opportunity Findus Overview Financial Highlights Conclusion 4
Slide 5: Introduction to Nomad Foods
Introduction to Nomad Foods 5
Slide 6: Nomad Foods at a Glance
Nomad Foods at a Glance Nomad Foods is a leading packaged foods company seeking to build a global portfolio of best-in- class food companies and brands within the frozen category and across the broader food sector • Leading branded • Headquartered in • Ticker: NHL (LSE) frozen packaged food Feltham,
Slide 7: Investment Highlights
Investment Highlights Platform to Lead Consolidation Leading Player in the Large and Iconic Brands with Strong in the Fragmented Global Food Resilient Western European Brand Equity Sector Frozen Food Market Attractive Financial Experienced Team with a Multiple Organic Growth Characteristics and Sign
Slide 8: Experienced Leadership
Experienced Leadership Overview of the Founders Noam Gottesman, Co-Chairman Martin E. Franklin, Co-Chairman Recognized leader in the financial services industry and global Distinguished business leader with extensive experience as an originator, investor with extensive experience identifying opp
Slide 9: Growth and Value Creation
Growth and Value Creation Nomad Foods
Slide 10: Platform to Create Long-Term Value
Platform to Create Long-Term Value Near-term priority to respond to ongoing top-line pressures from discounters and private-label with identified strategy; long-term vision to grow top-line based on organic and M&A driven strategy Stabilize and Grow Core Excellence in Execution Efficient Capital All
Slide 11: Long-Term Vision Supported by Identified Growth Strategy
Long-Term Vision Supported by Identified Growth Strategy Virtuous cycle now begins where we save to re-invest Lowest Cost Producer Disciplined Cost Management 5 Consumer Relevance Extract Synergies Net Sales and 1 Gross Margin Save to Revenue Management Re-Invest Promotional Spend & Pricing Architec
Slide 12: Identifying Savings to Re-Invest
Identifying Savings to Re-Invest Rigorous review of global overhead and cost base to yield savings to re-invest behind our top-line Systematically Reviewing Our We Have Just Begun Overhead Optimize our overhead structure for the Early stages; Findus acquisition closed on integrated business Nove
Slide 13: Innovation and Renovation
Innovation and Renovation Resources shifted from innovation and NPD to renovation of our core products to increase functionality, relevance and value to our consumers Innovation and Renovation Platform Key Products Launched Renovating core, existing products to best position “SteamFresh” our brand
Slide 14: Renovation of the Core
Renovation of the Core Portfolio Wholegrain Fish Fingers Wholegrain Fish Bakes Wholegrain Nuggets Wholegrain Filegro 14
Slide 15: Revenue and Customer Management
Revenue and Customer Management By obtaining greater visibility into the effectiveness of our trade spending, we can implement strategies to optimize promotional spending and pricing architecture Engaged in a robust process to assess and implement Early work is positive and indicates sizeable revenu
Slide 16: Online Sales Show Significant Growth and Over-Indexing
Online Sales Show Significant Growth and Over-Indexing Well-developed digital strategy to drive online sales benefiting from evolving e-commerce trends and brand recognition Strong UK Online Value Sales Growth(1) Online Over-Indexes with Key Retailers is #2 UK grocery online brand after Over-Index o
Slide 17: M&A Creates Commercial Synergy Opportunities
M&A Creates Commercial Synergy Opportunities Acquisitions, such as Findus, create incremental, commercial synergy opportunities to share innovation, develop a more robust product portfolio and deploy best practices Extending Our Core Innovative Packaging New Formats and Occasions 17
Slide 18: Platform and Market Opportunity
Platform and Market Opportunity 18 18
Slide 19: The Nomad Foods Platform
The Nomad Foods Platform Building organization to be a best‐in‐class integrator and to drive value creation opportunities Cash Flow Organic Generation European Growth Market Opportunity Leverage Leadership Strength of Core Business Efficient Capital Allocation Strong Management Identified Team Strat
Slide 20: Market Leadership in Europe with Pan-European Platform
Market Leadership in Europe with Pan-European Platform Findus Transaction expands geographic footprint and strengthens competitive offering in Europe Expanded Geographic Footprint Strengthened Market Leadership Position Strong positions (1) in savoury frozen food segment (2) Market share in Western
Slide 21: Global Packaged Food Market Opportunity is Significant
Global Packaged Food Market Opportunity is Significant Nomad Foods is well-positioned to lead broader food consolidation and build a best-in-class global foods company Global Packaged Food Retail Sales ($bn) ($ in billions) US Packaged Food $331 Europe Packaged Foods $787 Other Frozen $36 Other Pack
Slide 22: Consolidation Opportunities
Consolidation Opportunities Nomad Foods continues to execute its strategy to: (i) consolidate fragmented, frozen category across Europe and US, and (ii) pursue opportunities across the broader market in new and adjacent categories Robust M&A Pipeline Transformational Platform Investments Strategic T
Slide 23: Strategic Investment Criteria
Strategic Investment Criteria Disciplined approach to M&A with clear investment criteria Nomad Foods Investment Criteria • Market leader in a niche market • Protective moats around the business • Strong management organization • Long history of strong free cash flow generation • Attractive v
Slide 24: Findus Overview
Findus Overview Nomad Foods
Slide 25: Findus Continental Europe Overview
Findus Continental Europe Overview Business Snapshot Geographic Breakdown – FY2014(2) Transaction perimeter included non-UK operations only Revenue EBITDA − Key markets: Norway, Sweden and France Other Other, − Other markets: Spain, Finland, Denmark & Belgium 15% 8% Sweden, 39% Leading frozen fo
Slide 26: Transaction Rationale
Transaction Rationale Findus acquisition fits with Nomad’s stated acquisition criteria, provides diversification and further strengthens our leading frozen position Iconic brands across key markets Strong Brand Reunites Findus brand across the continent(1) Complements existing geographic footp
Slide 27: Findus Synergy and Integration
Findus Synergy and Integration Integration work is underway; revised annual synergies of €35 - €40 million over the next 3 years Pre-deal preparation and planning has enabled a strong start to the integration of the two businesses with a focus on realizing operational cost synergies. Latest view
Slide 28: Findus Acquisition is Transformative and Provides Diversification
Findus Acquisition is Transformative and Provides Diversification LTM Sept-2015 combined net sales(1) LTM Sept-2015 combined adjusted EBITDA(1) €m €m 400 Synergies 2,073 35 Increased scale 619 71 365 1,454 1,454 294 294 + + 2014A: Category split (2) 2014A: Geographical split (2) Poultry, Others, UK&
Slide 29: Financial Highlights
Financial Highlights Nomad Foods
Slide 30: Pro-forma as Adjusted EPS for Nomad Foods
Pro-forma as Adjusted EPS for Nomad Foods Existing business is expected to generate pro-forma annual cash flow of c. €200 million deleveraging in excess of 0.5x per year (1) Pro-forma Pro-forma (Excluding (Including (in €mm) Nomad Foods Findus Synergies) Synergies) (9) Adjusted EBITDA (2) € 294.0 €
Slide 31: Historical Performance
Historical Performance Revenue (€m) (1) € 1,573 € 1,506 € 1,501 € 1,106 € 1,059 (3) 2012A 2013A 2014A Q3 YTD 2014A (3) Q3 YTD 2015A Gross Profit (€m) and Gross Profit Margin (%) (1) € 544 € 504 € 530 € 388 € 359 33.5 35.3 34.6 35.1 33.9 (3) (3) 2012A 2013A 2014A Q3 YTD 2014A Q3 YTD 2015A Gross Profi
Slide 32: Best-in-Class Cash Flow Generation
Best-in-Class Cash Flow Generation Attractive operating cash flow conversion due to positive working capital trends and low capital expenditures Operating Cash Flow and Cash Flow Conversion (%) (1)(2) €300m 100% €250m 97% €200m 90% €162m 88% 87% €135m 2012A 2013A 2014A Q3 YTD 2014A Q3 YTD 2015A Note
Slide 33: Conclusion
Conclusion Nomad Foods
Slide 34: Investment Highlights
Investment Highlights Platform to Lead Consolidation Leading Player in the Large and Iconic Brands with Strong in the Fragmented Global Food Resilient Western European Brand Equity Sector Frozen Food Market Attractive Financial Experienced Team with a Multiple Organic Growth Characteristics and Sign
Slide 35: Appendix
Appendix Nomad Foods
Slide 36: EBITDA and Adjusted EBITDA (unaudited)
EBITDA and Adjusted EBITDA (unaudited) Nine Months Ended 30 September 2015 Nomad Foods Limited for Nomad Foods Limited for Iglo Group results for the Pro Forma As Adjusted for the six months ended the three months ended five months ended May the nine months ended September 30, 2015 March 31, 2015 31
Slide 37: EBITDA and Adjusted EBITDA (unaudited)
EBITDA and Adjusted EBITDA (unaudited) Nine Months Ended 30 September 2014 Nomad Foods Limited for Iglo Group results for the Pro Forma As Adjusted for the nine months ended nine months ended the nine months ended September 30, 2014 September 30, 2014 Adjustments(1) September 30, 2014 €m €m €m €m Gr
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