October 2015 All the information contained in this document is - - PowerPoint PPT Presentation

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October 2015 All the information contained in this document is - - PowerPoint PPT Presentation

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October 2015 All the information contained in this document is prepared accordance with International Financial Reporting Standards (IFRS) as of June 30, 2015, unless otherwise stated. Forward-Looking Statement The information herein contained

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October 2015

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All the information contained in this document is prepared accordance with International Financial Reporting Standards (IFRS) as of June 30, 2015, 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 reflects Grupo Herdez current expectations and views which could differ materially due to different factors, risks and

  • uncertainties. Therefore, Grupo Herdez and/or it´s respective officers, employees or agents, assume no responsibility
  • r 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

  • ther 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 ]

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categories

[ 3 ] network

products

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[ 4 ]

Improved execution Top line performance above GDP & population growth EBITDA margin within long-term sustainable range Development of new growth paths Investment for the future Increase Shareholders’ Value

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[ 5 ]

Communit munity Engag agement ment Environ ironment nt Qualit ality of Life Ethics & Transparency

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[ 6 ] plants distribution centers tuna vessels

+

employees countries

>Mexico ico >United States es >Canada >Central America & the Caribeean >Spain >UK

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%

[ 7 ]

Strong Corporate Governance

Frozen Division

Nutrisa since 2013 Helados Nestlé since 2015

Barilla Mexico

Since 2002

MegaMex

Since 2009

McCormick Mexico

Since 1947

Herdez Del Fuerte

Since 2008

% % % %

Grupo Herdez consolidates in its financial statements 100% of the Frozen División, Herdez Del Fuerte, Barilla Mexico and McCormick Mexico. While its proportional stake in MegaMex is registered in the Equity Investment in Associates.

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[ 8 ]

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[ 9 ]

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[ 10 ]

Retail 38% Wholesalers 34% Club Stores 8% Nutrisa Stores 8% Food Service 5% Traditional 4% Convenience 3%

#

supplier of groceries

+

sales employees

Presence in

%

  • f the aisles

+

Nutrisa stores

+

Helados Nestlé POS

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In value

[ 11 ] Tomato Puree 72% 85% 64% 28% 15% Mole Mayonnaise Pasta Tuna fish

Source: Company data with third party information *As of November 2014, includes Helados Nestlé & Nutrisa sales in retail

Ice Cream* 32%

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6

Grupo Herdez Competitor

67%

Competitor

96%

Competitor

23%

Competitor

92%

Grupo Herdez

%

Grupo Herdez

%

Grupo Herdez

%

Grupo Herdez

%

Market opportunity

[ 12 ]

Grupo Herdez

%

Competitor

90%

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[ 13 ]

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In value

[ 14 ] Frozen food 41% 74% 9% 2% Mole Guacamole Tortillas 4% Salsa

Source: Company data with third party information

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[ 15 ]

Portfoli lio

  • Rationa
  • nali

lizati zation Mix Optimi mizati ation Cost Improv

  • vem

emen ent SKU Producti tivity Expens ense Managem ement nt

$

  • %

Channel el Expan ansi sion

  • n

Retail Foodservice C-store Club Emerging / Alternative

Brand Build lding ng Innova vation Thought ht Leadershi rship M&A

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[ 16 ]

  • Assortment
  • Space allocation
  • Flow
  • Adjacency
  • Productivity
  • Aisle partnership
  • Total store
  • Destination

Retail 62% Convenience 19% Club Stores 13% Food Service 6%

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  • 100

200 300 400 500 600 700 800 900 1,000 2009 2010 2011 2012 2013 2014 Frozen Commercial

[ 17 ] %,- %

Major restructuring completed in 2014 which leaded to gross margin expansion

+ stores

% of net sales

in 7 states in frozen yogurt

+ products

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3 #2 player in the category Nestlé brand, strong positioning in Nutrition, Health & Wellness, and Trust Leader in Kids segment & Innovation Wide product portfolio of strong brands addressing all consumers and price points Reaches 49,000+ POS nationwide [ 18 ]

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7 [ 19 ]

Increase distribution Development

  • f alternative

channels

the size of the combined business to represent

  • % of total sales

.

times current in the next 5 years

Store opening aceleration Increase average ticket Reduce structural cost Enhance profitability

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7 [ 20 ]

Financial Flexibility Increase Shareholders´ Value Consistent earnings & FCF

FCF: Cash Flow from Operations minus CAPEX and M&A

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5,706 424 53 14,319 1,421 710 Net Sales FCF CAPEX 2004 2014 [ 21 ]

Consolidated figures in million pesos FCF: Cash Flow from Operations minus CAPEX and M&A

2.5x 3.3x 13.4x

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[ 22 ]

Consolidated figures in million pesos *Frozen: 2 years CAGR

2.5x

11,275 11,558 12,197 12,856 783 1,166 1,601 767 839 955 957

2012 2013 2014 12M 2Q15 Mexico Core Frozen Exports 12,042 13,180 14,319 15,414

CAGR 3Y

Mexico Core 4.5% Frozen* 43.0% Exports 7.7%

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[ 23 ]

Consolidated figures in million pesos *Frozen: 2 years CAGR

2.5x

1,788 1,876 2,232 2,557 111 117 172 55 63 66 69

2012 2013 2014 12M 2Q15 Mexico Core Frozen Exports 1,843 2,050 2,415 2,798

CAGR 3Y

Mexico Core 12.7% Frozen* 24.5% Exports 7.9%

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[ 24 ] Consolidated figures in million pesos

2.5x

229 200 176 308 239 447 298 792 2,990 1,060

2012 2013 2014 2015e Maintenance Growth Mergers & Acquisitions 469 3,842 574 2,160

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[ 25 ]

3.3x

200 200 200 200 200 100 150 100 100 150 600 219 783 1,000 2,000 2015 2016 2017 2018 2019 2020 2021 2022 2023 HERDEZ 14 Bank loan MXN HERDEZ 10 Bank loan USD HERDEZ 13-2 HERDEZ 13

Consolidated figures expressed in million pesos

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[ 26 ]

13.4x

14.2% 10.6% 12.9% 13.7% 14.2% 12.4% 17.7% 18.5% 11.5% 11.2% 11.7% 13.2% 2012 2013 2014 12M 2Q15 ROE

  • Adj. ROE

ROIC

Adjusted ROE for the elimination of the reasonable value of Herdez Del Fuerte as a result of the application of IFRS 10 & IFRS 3 ROE (Return on Equity)= Majority Net Income/ Average Majority Shareholders´ Equity ROIC (Return on Invested Capital)= Operatign Income/ (Shareholders´ Equity + Debt) Average

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[ 27 ]

3.3x

*Debt mix considers derivative instruments

Float 49% Fix 51%

*

MXN 84% USD 16%

* 2.0 1.4 1.7

2013 2014 12M 2Q15

Net Debt/EBITDA

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[ 28 ]

3.3x

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Net Income Share Price

Grupo Herdez performance is consistent with long-term strategy delivering proftibable growth to shareholders

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Net Sales [ 29 ]

3,318 3,946 2Q14 2Q15

+ %

447 602 2Q14 2Q15

EBIT

+ %

525 713 2Q14 2Q15

EBITDA

+ %

Consolidated Net Income

330 405 2Q14 2Q15

+ %

Margin 2Q15 15.3% % 2Q14 13.5% % Margin 2Q15 10.3% 2Q14 10.0% Margin 2Q15 18.1% % 2Q14 15.8% 8%

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Andrea Amozurrutia

Planeación Financiera y Relación con Inversionistas Tel.+52 (55) 5201 5636 aac@herdez.com

Grecia Domínguez

Gerente Relación con Inversionistas y Sustentabilidad Tel.+52 (55) 5201 5602 gdominguezl@herdez.com PH +52 (55) 5201 5636 aac@herdez.com PH +52 (55) 5201 5602 gdominguezl@herdez.com invrel@herdez.com

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