Q1 2017 Interim Management Statement May 2017 Disclaimer: Forward - - PowerPoint PPT Presentation

Q1 2017 Interim Management Statement

May 2017

Disclaimer: Forward Looking Statements

This presentation/announcement may contain forward looking statements with projections regarding, among other things, the Group’s strategy, revenues, earnings, trading profit, trading margin, finance costs, tax rate, capital expenditure, dividends, cash flow, net debt or other financial measures, the impact of foreign exchange fluctuations, the impact of raw material fluctuations and other competitive pressures. These and other forward looking statements reflect management expectations based on currently available data. However, actual results will be influenced by, among other things, macro-economic conditions, food industry supply and demand issues, foreign exchange fluctuations, raw material and commodity fluctuations, the successful acquisition and integration of new businesses, the successful execution of business transformation programmes and other, as of today, unknown factors. Therefore actual results may differ materially from these projections. These forward looking statements speak only as of the date they were made and the Group undertakes no obligation to publicly update any forward looking statement, whether as a result of new information, future events or otherwise.

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Brian Mehigan, CFO

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Performance Overview

Brian Mehigan, CFO

• Volume growth +3.8%
• Taste & Nutrition +4.1%
• Consumer Foods +2.3%
• Pricing +1.3%
• Group trading margin maintained
• Underlying margin expansion offset by transaction currency / Kerryconnect investment
• Taste & Nutrition +20bps
• Consumer Foods (70bps)
• Net debt of €1.2bn
• Earnings guidance for full year reaffirmed

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Q1 2017 HIGHLIGHTS

4.1% 2.3% 3.8% T&N Foods Group

VOLUME GROWTH

Strong Underlying Performance

REVIEW OF BUSINESS

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• Developed – overall stable with increased fragmentation
• Developing – economic & geopolitical volatility affecting growth
• Good start to 2017 – continued volume growth ahead of our markets
• Inflationary input costs – managing via pass through pricing model
• Acquisitions – 3 Taste acquisitions announced (Taste Master / Tianning / Hangman)
• Taste & Nutrition – agility of our holistic business model the driver of strong growth delivery
• Consumer Foods – good volume & underlying margin growth via innovation in snacking &

convenience

Q1 2017 Business Overview

BUSINESS PERFORMANCE HIGHLIGHTS MARKETS

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REVIEW OF BUSINESS

Q1 2017

4.5% 3.6%

Volume

Q1 2016

3.8%

Volume

(0.4%)

Transaction currency

1.3%

Price

0.4%

Acquisition/ disposal

(0.6%)

Translation currency

Q1 Revenue Growth Analysis

REVIEW OF BUSINESS

YT YTD GR GROWTH

Revenue +4.1%* Trading margin +20bps

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• Volume growth
• Good growth across all customers segments
• Strong growth in clean label, active nutrition & protein technologies
• Foodservice & c-store channels – strong performance globally
• Price inflation of 1.4% reflecting customer partnership agreements
• Margin progression – underlying margin growth driven by enhanced product mix

3.8% 1.9% 10.4% 4.1%

AMERICAS EMEA APAC T&N

ASIA-PACIFIC EMEA AMERICAS

• Developed – strong

performance in clean label, Taste & Dairy

• Developing – Brazil stable
• verall, Mexico performing well
• Strong growth across all regional

developing markets

• Beverage, Dairy & Culinary were

key drivers of growth

• Strategic footprint expansion

continuing (organic & acquisitive)

• Developed – Good growth in

Beverage, Dairy & Savoury

• Developing – Russia performing

well, South Africa & Middle East stabilised

REVENUE GROWTH BY REGION*

Taste & Nutrition

Note: * volume growth

REVIEW OF BUSINESS

YT YTD GR GROWTH

Revenue +2.3%* Trading margin (70bps)

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• Volume growth led by our expanding snacking range
• Inflationary environment with 1% average pricing across the quarter
• Recent innovations performing well – e.g. Scoffies snack packs, Fire & Smoke meat snacking

& Dairygold Softer Butter

• Underlying margin improvement more than offset by transaction currency

MEAL SOLUTIONS MEAT SNACKING DAIRY

• Cheese snacking – good growth
• Spreads – good growth in softer

butter technology offerings

• Go Go’s snack packs successfully

launched

• Chilled category – solid performance

via ongoing innovations

• Frozen category challenged but

growing in Foodservice and ‘direct to consumer’

• Meat snacking – performing well
• Richmond – category challenged
• Fire & Smoke range – continued

strong momentum

Consumer Foods

Note: * volume growth

OUTLOOK AND FUTURE PROSPECTS

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• Continued growth ahead of our markets
• Technology leadership for global, regional and local customers
• Innovation & agility the key drivers of growth
• Continued investment in science & footprint
• Continued enhancement in breadth and depth of technology portfolio
• Footprint expansion in key growth markets
• Continue to pursue strategic acquisition opportunities

In 2017, we expect to achieve good revenue growth and 5% to 9% growth in adjusted EPS* to a range of 339.6 to 352.5 cent per share (2016: 323.4 cent)

Note: * before brand related intangible asset amortisation and non-trading items (net of related tax)

Future Prospects

Q1 2017 Interim Management Statement

May 2017