Grupo LALA, S.A.B. de C.V.

Transcription

1 Grupo LALA, S.A.B. de C.V. NON-DEAL ROADSHOW PRESENTATION June,

2

3 ABOUT US 3

4 WHO WE ARE LALA is a Mexican Company focused in the healthy and nutritious food industry with over 65 years of experience in the production, innovation and marketing of milk and dairy products under the highest quality standards. LALA operates 22 production plants and 166 distribution centers in Mexico and Central America, and is supported by more than 33,000 employees. LALA operates one of the largest chilled distribution networks in the region, with 6,500+ delivery routes. Our product portfolio includes over 600 SKUs under 30+ brands, which are available at more than 550,000 points-of-sale. MISSION Nourishing your life is our passion VISION To be the favorite dairy company in the Americas 4

5 OUR FOOTPRINT Mexico United States Guatemala Honduras El Salvador Nicaragua Costa Rica 5

6 OUR PRODUCTS 6

7 MILK 7 Milk: Pasteurized, UHT and functional milks, pasteurized and UHT dairy-based beverages, and powdered milk.

8 OTHER DAIRY PRODUCTS 8 Other Dairy Products: Cream, butter, cream-based spreads, yoghurt, cheese, ice cream and desserts.

9 BEVERAGES AND OTHERS 9 Beverages and Others: Beverages, juices, cold cuts and other income.

10 COMSUMPTION & DAIRY OUTLOOK Investing today to capture Mexico s future growth opportunities

11 CONSUMER OUTLOOK Today s market trends and consumption are moving towards foods and beverages categories that have functional benefits. More than half the consumers across all generations are willing to pay a premium for products that provide health benefits. The reinvention of dairy as a completely natural food plays an important role in this consumer trend. Creating new products that appeal to the health trend is not enough marketing, processing technology and convenience are important factors to be consider. 11

12 AMERICAS DAIRY MARKET TOTAL AMERICAS DAIRY MARKET VALUE IS ~US$160 BILLION World Dairy Market value is ~US$550 billion. 46% USA 24% Brazil 9% México The U.S., Mexico and Central America represents 58.0% of total Americas Dairy Market. Americas Dairy Market it s projected to grow by ~US$16 billion in next 5 years. 2% Others 1% Peru 2% Chile 8% Canada 3% Central America 3% Colombia 2% Argentina Brazil México 12 (1) Central America includes: Costa Rica, Dominican Republic, Guatemala, Nicaragua and other Central America / Caribean countries. (2) Others includes: Ecuador, Bolivia, Uruguay, Venezuela and other South America Countries. Source: Euromonitor, Company information.

13 LALA 2016 STRATEGIC PRIORITIES Sustainable Growth Strategy 13

14 ACCELERATING ORGANIC GROWTH IN MEXICO On-trend products and packing innovation New marketing campaign World-Class go-to market execution 14

15 ON-TREND PRODUCTS AND PACKING INNOVATION LALA 100 Aseptic Non-lactose More protein and calcium PET material packing 15

16 ON-TREND PRODUCTS AND PACKING INNOVATION CHEESE New resealable technology Shredded and slice presentation Non-lactose 16

17 ON-TREND PRODUCTS AND PACKING INNOVATION LALA SEMILLAS Super food seeds Low sugar and fat content 17

18 ON-TREND PRODUCTS AND PACKING INNOVATION NUTRI LECHE Top-five consumer brand in Mexico Annual sales above US$1 billion Nutri umbrella brand to increase product offer among low-incomes classes 18

19 MEXICO TOP FIVE CONSUMER BRANDS PLACE BRAND PENETRATION 99% 98% 99% 75% 89% FREQUENCY The Largest Healthy Food Company in Mexico Classified among Mexico s top five consumer brands. 19 Source: Kantar Worldpanel Penetration based on number of households that purchase a brand; 2. Frecuency of purchase (# of times per year)

20 NEW MARKETING CAMPAIGN NATIONAL TV ADVERTISING 20

21 DEVOLOPING INTERNAL CAPABILITIES STRATEGIC PROCUREMENT ARIBA Software implementation SALES & OPERATIONAL PLANNING Improve Customer Service SHARED SERVICE STRUCTURE Structure and location 21

22 EXPAND & CONSOLIDATE CENTRAL AMERICA OPERATIONS Production Plant San Benito, Nicaragua 22

23 M&A AND ALLIANCES LALA OPERATES IN 7 COUNTRIES OPPORTUNITIES REGION MARKET ADDING The Americas Dairy & Dairy alternatives Infrastructure, brands, value- added categories and talent. Our Strategy Follows 23 a Disciplined Process

24 LALA U.S. OPERATION Building brands to grow the business 24

25 U.S. PRODUCTION FACILITIES SINTON, COLORADO OMAHA, NEBRASKA FLORESVILLE, TEXAS 25 Drinkable Yoghurt Spoonble Yoghurt Sour Cream ESL Milk ESL Milk Cultured

26 U.S. BRANDED PORTFOLIO Products reach fastest growing segment Millennials Convenience Portability Health Conscious Taste Innovation 26

27 U.S. BRANDED PORTFOLIO Natural Milk Higher Protein Higher Calcium Simple Ingredients Richer, Creamier Texture Jersey Cows less than 10% of milk supply Right Time for Promised Land National Expansion 27

28 U.S. BRANDED PORTFOLIO Mainstream on-the-go Smoothie in a bottle brand with healthy halo of yoghurt Established brand equity with positioning that suggests yoghurt blends of fruits and vegetables to meet high health trends Rich, creamy taste and superior texture 100% fat free More protein and calcium 28

29 U.S. NATIONAL EXPANSIONS ON TRACK LALA DRINKABLE YOGHURT PROMISED LAND Sept ACV: 25.0% Sept ACV: 71.0% Sept ACV: 23.0% Sept ACV: 58.0% 15,364 STORES 12,551 STORES Presence in Big Retailers with Exposure National Wide 29

30 360 MARKETING SUPPORT Social Media Digital Television Website Public Relations Mobile 30 Sampling Shopper Marketing

31 OPPORTUNITIES IN U.S. WITH HISPANIC CONSUMERS Hispanics Represent Majority of Future Population Growth Over 55 million Hispanics in the U.S. today Growth rate is 3X the U.S. rate 18% of U.S. population and over 50% of the growth by 2020 Hispanic Households Have Higher Spending Power Larger family size = higher household spending 1 in every 6 individuals; 1 in every 4 children 10 years younger than general U.S. population entering prime earning years $1.3 Trillion in spending power in 2015 Substantial Opportunities Opportunities to gain share of Hispanic sales by partnering with key retailers focused on this segment Brands and categories can grow via enhanced alignment with Hispanic consumers 31 Source: US Census Bureau, Pew Hispanic Center, Selig Center for Economic growth.

32 U.S. MANAGEMENT - TALENT Jim Richard Chief Commercial Officer 35+ Years Toby Purdy Chief Marketing Officer 25+ Years George Lorenz Vice President, Supply Chain 20+ Years 32

33 TRANSACTION KEY DATA SUMMARY CONSIDERATIONS The U.S. branded business, manufactures and distributes leading products in value-added categories with brands like LALA and Frusion and premium milk with leading brands like Promised Land and Skim Plus. Grupo LALA has entered into an agreement to acquire from Laguna Dairy S. de R.L. de C.V. certain assets related to Laguna s branded business in the U.S. as there are significant compatibilities between both companies in terms of products, profitability and R&D, which could help the Company bring significant synergies in the mid-term. TRANSACTION KEY DATA Value Transaction: US$246 Million Estimated Sales 2016: ~US$200 Million Value-Added Dairy Companies Mean: FV/Sales = 2.3.x The Branded Business would add sales of ~US$200mm to Grupo LALA and would increase its geographic penetration to more markets, in high growth categories. Furthermore, based on current dynamics, there is significant synergy potential to target the US Hispanic market, one of LALA s main objectives. 33

34 CAPEX INVESTMENTS 2016 A total investment of +3,000mm MXN

35 CHEESE PRODUCTION CAPACITY Investment: +1,000mm MXN Delivery: Q Location: Complejo Laguna, Torreon, Mexico Increasing cheese production capacity and new packing technology 35 * All figures and dates are according to Company s estimations.

36 WHITE BASE CAPACITY (YOGHURT) Investment: +250mm MXN Delivery: Q Location: Complejo Irapuato, Irapuato, Mexico Increase of production capacity and new topping technology 36 * All figures and dates are according to Company s estimations.

37 WATER TREATMENT PLANT Investment: +100mm MXN Delivery: Q Location: Complejo Laguna, Torreon, Mexico New facility for water treatment 37

38 NEW PASTEURIZATION PLANT, NORTH MEXICO Investment: +300mm MXN Delivery: Q Location: Cd. Obregon, Mexico Construction of a new state of the art pasteurization facility 38 * All figures and dates are according to Company s estimations.

39 AUTOMATED INDUSTRIAL WAREHOUSE Investment: +200mm MXN Delivery: Q Location: Complejo Irapuato, Irapuato, Mexico New automated industrial warehouse to increase storage capacity 100% Refrigerated capacity Up to 23,000 storage positions 39 * All figures and dates are according to Company s estimations.

40 NANO FILTRATION - LALA 100 MILK Investment: +200mm MXN Delivery: Q Location: Aguascalientes, Mexico Production capacity using Nano- Filtration Technology The first production line with PET packing material in Mexico and Central America 40 * All figures and dates are according to Company s estimations.

41 NEW TETRA PAK EQUIPMENT OF 1.5L UHT PRODUCTS Investment: +100mm MXN Delivery: Q Location: Aguascalientes, Mexico New equipment and technology for Tetra Pak packing of 1.5L for UHT products 41 * All figures and dates are according to Company s estimations.

42 OTHER INVESTMENTS Investment: +300mm MXN New UHT Multi-Packing Complejo Laguna - Torreon, Mexico Increase of production capacity Guadalajara, Mexico Increase cooler space at point of sale 42 * All figures and dates are according to Company s estimations.

43 KEY FINANCIAL INFORMATION 43

44 FINANCIAL RESULTS (P&L) 3 MONTHS ENDED MARCH 31, 2016 Income Statement (1) 1Q-15 % 1Q-16 % Growth Net Sales $ 11, % $12, % 7.6% Gross Profit 4, % 4, % 9.5% Operating Income 1, % 1, % 14.0% EBITDA (2) 1, % 1, % 15.1% Net Income % 1, % 17.8% SALES BY TRADE CHANNELS % 49.0% Company Data, in Mexican Pesos. ( 000) 2. EBITDA=Earnings Before Interest, Taxes, Depreciation and Amortization.

45 SALES BY SEGMENT Segment 1Q-15 1Q-16 % Variation Milk $ 7,705 $8, % Other Dairy Products 3,261 3, % Beverages and Other % 65.1% 28.6% 6.3% Company Data, in Mexican Pesos. ( 000)

46 STRONG FINANCIAL POSITION $8,097 $9,083 Key Metrics 1Q-15 1Q-16 Net Debt / EBITDA (1.4)x (1.3)x EBITDA / Interest Paid 774.2x 377.5x EARNINGS PER SHARE $1.30 $1.65 AS OF MARCH 31, $73 $87 1Q-15 1Q-16 Total Debt (MXN$mm) Cash (MXN$mm) Financial Position Total Assets $31,412 $35,809 Cash 8,097 9,083 Total Liabilities 8,429 10,366 Shareholder Equity 22,983 25, Source: Company Information Ratios are calculated in local currency Figures in Mexican Pesos ( 000)

47 LALA B OVERVIEW SHARE PRICE GROWTH YTD 13.00% AVERAGE DAILY LIQUIDITY 2016 US$6.0mm May 25th, 2016 (LALA B) SHAREHOLDERS STRUCTURE 2,475,932,111 shares $45.27 OWNERSHIP STRUCTURE 21.4% Free Float 1.1% Others 55.0% Control Trust % Underwriting Trust 47 Source: Company Information, Bolsa Mexicana de Valores, Analyst Research.

48 LALA 2016 STRATEGIC PRIORITIES Accelerating Organic Growth in Mexico Developing Internal Capabilities Expand & Consolidate Central America Operations M&A and Alliances 48

49 CONTACT INFORMATION Investor Relations Enrique González +52 (55) Stock Information Grupo LALA has been traded under the ticker LALA B on the Bolsa Mexicana de Valores (BMV) since October 16, For more information: Forward-looking statements This document contains certain assumptions, projections and forward-looking statements regarding the Company s financial situation, operative results and information, Grupo LALA s business and that of its subsidiaries as well as with regards to the Company s related plans and objectives. This executive summery does not constitute a public securities offering on behalf of LALA and is intended to be used for informational purposes only. 49

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