Resilience & Focus Investors Presentation May 2018 - Grupo Herdez
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Resilience
& Focus
Investors Presentation
May 2018
All the information contained in this document is prepared in accordance with International Financial
Reporting Standards (IFRS) as of March 31, 2018, unless otherwise stated.
Forward-Looking Statement
The information herein contained (“Information”) has been prepared by Grupo Herdez, S.A.B. de C.V., its associates,
subsidiaries and/or affiliated companies (“Grupo Herdez”) and may contain forward-looking statements that reflect
Grupo Herdez current expectations and views which could differ materially due to different factors, risks and
uncertainties. Therefore, Grupo Herdez and/or its respective officers, employees or agents, assume no responsibility or
liability for any discrepancy in the Information. In particular, but without prejudice to the generality of the foregoing, no
warranty is given as to the accuracy of the statements or the future variation of the Information or any other written or
oral Information issued by Grupo Herdez. The Information has been delivered for informative purposes only. The
issuance of this information shall not be taken as any form of commitment on the part of Grupo Herdez to proceed with
any transaction.
2
Investment Case
+100
Years of Branded food Diversified Profitable growth
experience leader portfolio strategy
Sound financial Solid corporate Committed to
structure governance sustainability
3
Strategy
4
Infrastructure
471 7
15
Nutrisa tuna
plants
stores vessels
56,000
22 More than Helados
distribution 9,500 Nestlé
centers employees POS
5
Corporate Structure
Grupo Herdez consolidates 100% of
the Frozen division, Herdez Del
Fuerte, Barilla México y McCormick
de México.
The proportional part of Herdez Del
Fuerte in MegaMex is registered in
“Equity Investment in Associates“.
6
Corporate Governance
Héctor Hernández-Pons Torres
Chairman
Enrique Hernández-Pons Torres
• HERDEZ* single series
PROPIETARY Vicepresident
Flora Hernández de Merino • Robust governance structure from
Board member subisidiaries
• 67% independent members
Carlos Autrey Maza
• Assignment of individual
Enrique Castillo Sánchez Mejorada responsibilities on corporate
José Roberto Danel Diaz governance, labor and
INDEPENDENT
Eduarto Ortíz Tirado Serrano environmental practices
67%
Luis Rebollar Corona
José Manuel Rincón Gallardo
7
Sustainability Model
Awards & Certifications
8
Leading Brands
Our brands in Mexico
Our brands in United States
Distribution agreements in Mexico
9
Commercial Leadership
Sales mix by channel Sales mix
Mushrooms, 1%
by category
DSD Convenience Food Packaging, 1% Others
(traditional) Juice, 1%
4% 7%
Thea, 2%
5%
Foodservice Catsup, 2%
6%
Jams, 2%
Nutrisa stores Presence in Retail
Salsa, 3% Mayonnaise
ALL
35% 34%
7% Canned
vegetables
Club stores 4%
8% the sales channels in Mole
4%
Mexico
Canned tuna
4%
Tomato puree
8%
Wholesalers Frozen
35% Pasta 16%
8%
Consolidated figures in million pesos 10Segments
Preserves Frozen Exports
79% of net 16% of net sales 6% of net sales
sales
CAT E G O R I E S CAT E G O R I E S CAT E G O R I E S
• Canned tuna • Soft drinks • Mexican food
• Mayonnaise • Healthy snacks • Mayonnaise
• Mole • Frozen yogurt • Tea
• Tomato puree • Popsicles
• Pasta • Food supplements
• Vegetables
MegaMex is registered in “Equity Investment in Associates” and includes categories like guacamole, salsas and vegetables. 11Market Share in Mexico
Canned tuna 10% Pasta 29%
We are #1 or #2
in categories that Mayonnaise 73% Tomato purée 71%
represents
the 82% of Jams 39% Salsa 42%
our sales
Mole 84% Vegetables 27%
12Segments
Preserves Growth Drivers
Regional More
penetration consumption
occasions
Health & Integrated
Wellness communication
13Frozen Growth Drivers
Club stores
1%
Retail Others
8% 2%
Sales mix Increase store
optimization traffic & freezer
Convenience
13%
Nutrisa stores
SALES MIX 46%
by channel
Strenghening
SG&A
DSD (traditional) of new sales
30% management
channels
Consolidated figures in million pesos
14MegaMex Growth Drivers
Increase sales Accelerate Expansion of
by innovation brand growth sales channels 2020 Goals
USD $1B Net sales
14-16% EBITDA
margin
Reduce general Improve gross
Reduce
expenses as a margins through
production
proportion of efficient portfolio
costs
net sales management
15Net Sales
CAGR 5years
Preerves 6.6%
Frozen 25.7% 20,065 19,956
1,230
Exports 7.8% 18,181 1,288 Exports
1,158 6%
16,357 2,882 2,908
Frozen
1,079 2,592
14,318 2,139
15,953 15,760 15%
955
1,166
13,139
14,431
SEGMENT
12,197 MIX
Preserves
79%
2014 2015 2016 2017 12M1Q18
Preserves Frozen Exports
Consolidated figures in million pesos 16EBITDA
CAGR 5years
Preserves 6.6%
Frozen 28.7%
Exports 19.4% 3,268 Exports
3,295 Frozen 4%
130 134
2,887 83 2,816 277 321 10%
136 79 2,888
103
2,415 2,668 2,634
2,813
117
66
SEGMENT
2,232
MIX
17.7
16.9
16.4 16.4 Preserves
86%
15.5
2014 2015 2016 2017 12M1Q18
Conservas Congelados Exportación Margen UAFIDA
Consolidated figures in million pesos 17Profitability
41.4
39.0 39.9 39.3 39.1
16.9 17.7
15.5 16.4 16.4
14.8 13.9 13.8
12.4 13.0
10.5 10.8 10.6
7.9 8.8
5.4 5.2 5.0
2.4 3.9
2014 2015 2016 2017 12M1Q18
Gross Margin EBIT EBITDA Net Income Majority Net Income
18Returns
13.7%
13.1%
12.2% 11.9%
10.9%
10.2%
2016 2017 12M1Q18
ROE ROIC
19
ROE (Return over Equity) = Majority Net Income / Annual Average Majority Shareholder´s Equity
ROIC (Return over Invested Capital) = EBIT / (Consolidated Shareholder´s Equity + Total Debt) (annual average from last two years)Stock Performance
PA RT O F T H E I N D E X E S
• Comercial
• Consumo Frecuente
• IMC30
• IPC CompMX
• IPC SmallCap
• IPC Sustentable
• Transforma Jan-16 Apr-16 Jul-16 Oct-16 Jan-17 Apr-17 Jul-17 Oct-17 Jan-18
Δ% Herdez Δ% IPC Δ% Consumo Frecuente
EPS 432
MXN 2.32 49% million
march2018 float outstanding
shares
20Debt Structure
Flotante
20%
MIX
RATES Fija
80%
2,000 2,000
Financial Debt 6,530
930 1,000 Average Cost 8.5%
200
200 200 Net DEBT/EBITDA 1.5
2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 Net Debt/
BBVA CP Herdez 14 HSBC LC Herdez 17-2 Herdez 13 Herdez 17 Shareholders Equity 0.29
Consolidated figures in million pesos
The debt mix considers hedge derivates 21For more information:
Andrea Amozurrutia
Tel.+52 (55) 5201 5636
aac@herdez.com
Grecia Domínguez
Tel.+52 (55) 5201 5602
gdominguezl@herdez.com
Fernando Acevedo
Tel.+52 (55) 5201 5655 ext. 1052
lfacevedom@herdez.com
invrel@herdez.com
www.grupoherdez.com.mx
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