Attached files
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| EX-99.1 - EX-99.1 - EARNINGS PR - BELLRING BRANDS, INC. | brbrexh991-q42020earni.htm |
| 8-K - 8-K - BELLRING BRANDS, INC. | brbr-20201119.htm |
Fourth Quarter Fiscal Year 2020 Supplemental Presentation November 19, 2020
Cautionary Statement Regarding Forward-Looking Statements Certain matters discussed in this presentation are forward-looking • BellRing’s ability to continue to compete in its product categories and statements within the meaning of the Private Securities Litigation its ability to retain its market position and favorable perceptions of its Reform Act of 1995. These forward-looking statements are made brands; based on known events and circumstances at the time of release, and • BellRing’s dependence on a limited number of third party contract as such, are subject to uncertainty and changes in circumstances. manufacturers and suppliers for the manufacturing of most of its These forward-looking statements include, among others, statements products, including one manufacturer for the substantial majority of regarding BellRing Brands, Inc.’s (“BellRing,” the “Company,” “we,” its RTD protein shakes; “us,” or “our”) prospective financial and operating performance and • BellRing’s reliance on a limited number of third party suppliers to opportunities and statements regarding the effect of the COVID-19 provide certain ingredients and packaging; pandemic on BellRing’s business and BellRing's continuing response • significant volatility in the cost or availability of inputs to BellRing’s to the COVID-19 pandemic. These forward-looking statements are business (including freight, raw materials, packaging energy and sometimes identified from the use of forward-looking words such as other supplies); “believe,” “should,” “could,” “potential,” “continue,” “expect,” “project,” “estimate,” “predict,” “anticipate,” “aim,” “intend,” “plan,” “forecast,” • BellRing’s ability to anticipate and respond to changes in consumer “target,” “is likely,” “will,” “can,” “may” or “would” or the negative of and customer preferences and behaviors and introduce new these terms or similar expressions, and include all statements products; regarding future performance, earnings projections, events or • disruptions or inefficiencies in BellRing’s supply chain, including as a developments. There are a number of risks and uncertainties that result of BellRing’s reliance on third party suppliers or manufacturers could cause actual results to differ materially from the forward-looking for the manufacturing of many of its products, pandemics (including statements made herein. the COVID-19 pandemic), changes in weather conditions, natural THESE RISKS AND UNCERTAINTIES INCLUDE, BUT ARE NOT disasters, agricultural diseases and pests and other events beyond LIMITED TO, THE FOLLOWING: BellRing’s control; • consolidation in BellRing’s distribution channels; • the impact of the COVID-19 pandemic, including negative impacts on the global economy and capital markets, the health • BellRing’s ability to expand existing market penetration and enter into of BellRing’s employees, BellRing’s ability and the ability of its new markets; third party manufacturers to manufacture and deliver its • allegations that BellRing’s products cause injury or illness, product products, operating costs, demand for its on-the-go products recalls and withdrawals and product liability claims and other and its operations generally; litigation; • BellRing’s dependence on sales from its ready-to-drink (“RTD”) • legal and regulatory factors, such as compliance with existing laws protein shakes; and regulations, as well as new laws and regulations and changes to existing laws and regulations and interpretations thereof, affecting BellRing’s business, including current and future laws and regulations regarding food safety, advertising and labeling; 2
Cautionary Statement Regarding Forward-Looking Statements (Cont’d) (CONTINUED FROM PRIOR PAGE): • BellRing’s ability to identify, complete and integrate or otherwise • risks related to BellRing’s ongoing relationship with Post effectively execute acquisitions or other strategic transactions and Holdings, Inc. (“Post”), including Post’s control over BellRing; effectively manage its growth; • ability to control the direction of BellRing’s business, conflicts of • fluctuations in BellRing’s business due to changes in its interest or disputes that may arise between Post and BellRing promotional activities and seasonality; and BellRing’s obligations under various agreements with Post, • risks associated with BellRing’s international business; including under the tax receivable agreement; • the loss of, a significant reduction of purchases by or the • risks associated with BellRing’s public company status, including bankruptcy of a major customer; the additional expenses BellRing will continue to incur to create • the ultimate impact litigation or other regulatory matters may have and maintain the corporate infrastructure to operate as a public on BellRing; company; • the accuracy of BellRing’s market data and attributes and related • BellRing’s ability to satisfy the requirements of Section 404 of the information; Sarbanes-Oxley Act of 2002; • changes in estimates in critical accounting judgments; • significant differences in BellRing’s actual operating results from any guidance BellRing may give regarding its performance; • economic downturns that limit customer and consumer demand for BellRing’s products; • BellRing’s ability to hire and retain talented personnel, employee absenteeism, labor strikes, work stoppages or unionization • changes in economic conditions, disruptions in the United States efforts; and and global capital and credit markets, changes in interest rates, volatility in the market value of derivatives and fluctuations in • other risks and uncertainties described in BellRing’s filings with foreign currency exchange rates; the Securities and Exchange Commission. • BellRing’s ability to protect its intellectual property and other You should not rely upon forward-looking statements as assets; predictions of future events. Although BellRing believes that the expectations reflected in the forward-looking statements are • costs, business disruptions and reputational damage associated reasonable, BellRing cannot guarantee that the future results, with information technology failures, cybersecurity incidents and/or levels of activity, performance or events and circumstances information security breaches; reflected in the forward-looking statements will be achieved or • impairment in the carrying value of goodwill or other intangibles; occur. Moreover, BellRing undertakes no obligation to update • BellRing’s high leverage, its ability to obtain additional financing publicly any forward-looking statements for any reason after the (including both secured and unsecured debt) and its ability to date of this presentation to conform these statements to actual service its outstanding debt (including covenants that restrict the results or to changes in its expectations. operation of its business); 3
Additional Information Prospective Information Market and Industry Data Any prospective information provided in this presentation regarding This presentation includes industry and trade association data, BellRing’s future performance, including BellRing’s plans, forecasts and information that were prepared based, in part, upon expectations, estimates and similar statements, represents BellRing data, forecasts and information obtained from independent trade management’s estimates as of November 19, 2020 only and are associations, industry publications and surveys and other qualified by, and subject to, the assumptions and the other independent sources available to BellRing. Some data also is based information set forth on the slide captioned “Cautionary Statement on BellRing management’s good faith estimates, which are derived Regarding Forward-Looking Statements.” from management’s knowledge of the industry and from independent sources. These third party publications and surveys generally state Prospective information provided in this presentation regarding that the information included therein has been obtained from sources BellRing’s plans, expectations, estimates and similar statements believed to be reliable, but that the publications and surveys can give contained in this presentation are based upon a number of no assurance as to the accuracy or completeness of such assumptions and estimates that, while they may be presented with information. BellRing has not independently verified any of the data numerical specificity, are inherently subject to business, economic from third party sources nor has it ascertained the underlying and competitive uncertainties and contingencies, including the economic assumptions on which such data are based. Similarly, COVID-19 pandemic, many of which are beyond BellRing’s control, BellRing believes its internal research is reliable, even though such are based upon specific assumptions with respect to future business research has not been verified by any independent sources and decisions, some of which will change, and are necessarily BellRing cannot guarantee its accuracy or completeness. speculative in nature. It can be expected that some or all of the assumptions of the estimates will not materialize or will vary Trademarks and Service Marks significantly from actual results. Accordingly, the information set forth herein is only an estimate as of November 19, 2020, and actual Logos, trademarks, trade names and service marks mentioned in results will vary from the estimates set forth herein. It should be this presentation, including BellRing®, BellRing Brands®, Premier recognized that the reliability of any forecasted financial data Protein®, Dymatize®, PowerBar®, Premier Protein Clear®, diminishes the farther in the future that the data is forecast. In light of ISO.100®, Elite Mass®, Elite Whey Protein®, Elite 100% Whey®, the foregoing, investors should put all prospective information in Super Mass Gainer®, All9 Amino®, PREW.O®, Athlete’s BCAA®, TM TM TM context and not rely on it. PowerBar Clean Whey , PowerBar Protein Plus , Protein Nut2 , PowerBar EnergizeTM, Joint Juice® and Supreme Protein®, are Any failure to successfully implement BellRing’s operating strategy currently the property of, or are under license by, BellRing or one of or the occurrence of the events or circumstances set forth under its subsidiaries. BellRing or one of its subsidiaries owns or has rights “Cautionary Statement Regarding Forward-Looking Statements” to use the trademarks, service marks and trade names that are used could result in the actual operating results being different than the in conjunction with the operation of BellRing or its subsidiaries’ estimates set forth herein, and such differences may be adverse and businesses. Some of the more important trademarks that BellRing or material. one of its subsidiaries owns or has rights to use that appear in this presentation may be registered in the U.S. and other jurisdictions. Each logo, trademark, trade name or service mark of any other company appearing in this presentation is owned or used under license by such company. 4
Q4 FY2020 Consumption and Key Metrics Executive Summary ● Premier Protein Q4 FY2020 ready-to-drink ("RTD") shake consumption vs. prior year is up 20%1 in tracked and untracked channels. This is mainly due to: ○ Distribution gains in club, food, drug and mass ○ Increased marketing and promotion ● Key metrics continue to show strong progress against our growth strategies and reaffirm a long runway for sustained growth. ○ Household penetration for Premier Protein is at 6.8%2, an increase of 16% vs. the prior year period, hitting our annual goal. The brand continues to have strong upside with household penetration of 24% in the liquids category and 53% within convenient nutrition. ○ Total distribution points ("TDPs") continue to grow, up 9%3 vs Q3 FY2020 with strong results in food, drug and mass. ○ Premier Protein's market share continues to grow to 17%3 of total liquids for the quarter. Notes: 1. Nielsen xAOC+C 13 weeks ended September 26, 2020 and management estimates of untracked channels for the 13 weeks ended September 27, 2020. 2. Nielsen HH panel September 26, 2020. 5 3. Nielsen xAOC+C 13 weeks ended September 26, 2020.
Portfolio Breakdown FY 2020 Net Sales By Brand FY 2020 Net Sales By Product Type Other Other 1% 1% 4% Nutrition Bars 5% 11% Powders RTD Shakes and 12% Other RTDS 82% 84% FY 2020 Net Sales By Channel FY 2020 Net Sales By Geography Other eCommerce 2% 10% International 11% Specialty 7% FDM 21% Club 60% US 89% 6
Liquids Category is Healthy and Has Returned to Historic Growth Rate RTD Liquids Category Growth Rate Last 13 weeks +7.0% Liquids COVID-19 12.28.19 – 9.26.20 Last 52 weeks +5.2% stock-up 25% Rebound 15% De-Load Historic growth 5% 0% -15% -20% $%Chg 11 7 10 8 11 11 10 14 9 6 13 33 29 -12 -16 -19 -18 -5 -12 -8 -5 1 1 -1 9 10 3 10 1 12 10 5 7 7 5 1 10 6 9 9 v YA Notes: Nielsen xAOC+C. 7
Premier Protein RTD Shakes Growing in Key Channels Premier Protein RTD Shakes Sales vs. Prior Year Channel 13 Weeks 52 Weeks Club 8.8% 15.2% Mass 10.7% 28.0% Food 63.8% 59.7% Drug -7.7% 27.3% eCommerce 161.5% 170.5% Total Consumption (tracked + untracked channels) 20.4% 26.6% Total Tracked 4.3% 13.7% Total Untracked 38.3% 42.1% Notes: Nielsen xAOC+C 13 and 52 weeks ended Sept 26, 2020 and management estimates of untracked channels for the 13 and 52 weeks ended Sept 27, 2020. 8
Premier Protein RTD Shakes Continue to be a Strong Growth Brand Premier Protein RTD Shakes COVID-19 Rolling 13 week Total $ Consumption Sales Supply Constraints Seasonality $ Volume Jul 28 '19 Jul 26 '20 Apr 28 '19 Oct 27 '19 Apr 26 '20 Jan 27 '19 Jun 30 '19 Jan 26 '20 Jun 28 '20 Mar 31 '19 Mar 29 '20 Feb 24 '19 Feb 23 '20 Nov 24 '19 Dec 29 '19 Aug 25 '19 Sep 30 '19 Aug 23 '20 Sep 26 '20 May 26 '19 May 24 '20 YOY Q2 Q3 Q4 Q1 Q2 Q3 Q4 % Δ (1%) +14% +15% +31% +48% +11% +20% Notes: Nielsen xAOC+C and management estimates of untracked channels. 9
Premier Protein RTD Shake Shipments Can Vary by Quarter Due to Major Promotional Events But Grow Over Time Premier Protein RTD Shake Shipments vs Consumption1 (13 Week Quarters) Promotional De-Load; Promotional Promotional Promotional Promotional Promotional Promotional De-Load Promotional Offset by offset by COVID-19 and COVID-19 Load-In and Flavor Load-in2 De-Load Load-In and New Item Load-in Flavor Load-in2 Inventory Build De-Load Total Units Q1-19 Q2-19 Q3-19 Q4-19 Q1-20 Q2-20 Q3-20 Q4-20 Premier Protein Consumption Premier Protein Shipments Linear (Premier Protein Consumption) Notes: 1. Nielsen xAOC+C and management estimates of untracked channels. 2. Flavor Load-In refers to the pipeline fill following supply constraints in early fiscal 2019. 10
Media is Driving Household Penetration Premier Protein Total Brand & RTD Shakes Penetration Liquids 24 HH Pen 8.0 6.8 7.0 6.4 5.8 6.0 5.5 5.3 Liquids 19.5 HH Pen 5.0 4.7 4.8 3.9 4.0 3.8 3.0 2.8 2.0 1.0 +23% +38% +17% +22% +6% +10% +17% +23% 0.0 CY 2016 CY 2017 CY 2018 CY 2019 52 w/e September 2020 HH Pen - PP Premier Protein Brand HH Pen - Premier Protein RTD Shakes 30g Shake Repeat 51% 56% 57% 52% 50% Rates Notes: Nielsen HH panel September 26, 2020. Liquids refers to the liquid sub-category of the convenient nutrition category. Calendar Year (“CY”). Nielsen metrics such as penetration are subject to potential restatement or revisions due to market definition changes or late reporters. 11
TDPs Grow to Shakes & ACV Continue TDPs RTD Protein Premier 100 150 200 250 300 350 400 450 500 50 0 53 176 4 WE 01/21/17 4 WE 02/18/17 4 WE 03/18/17 4 WE 04/15/17 Nielsen Nielsen Notes: 4 WE 05/13/17 4 WE 06/10/17 4 WE 07/08/17 xAOC+C 4 WE 08/05/17 4 WE 09/02/17 September 26, 2020. 26, September 4 WE 09/30/17 4 WE 10/28/17 4 WE 11/25/17 4 WE 12/23/17 4 WE 01/20/18 4 WE 02/17/18 4 WE 03/17/18 4 WE 04/14/18 4 WE 05/12/18 4 WE 06/09/18 4 WE 07/07/18 4 WE 08/04/18 4 WE 09/01/18 TDP 4 WE 09/29/18 4 WE 10/27/18 constraints 4 WE 11/24/18 Supply 4 WE 12/22/18 %ACV 4 WE 01/19/19 4 WE 02/16/19 4 WE 03/16/19 4 WE 04/13/19 4 WE 05/11/19 4 WE 06/08/19 4 WE 07/06/19 4 WE 08/03/19 4 WE 08/31/19 4 WE 09/28/19 4 WE 10/26/19 4 WE 11/23/19 4 WE 12/21/19 4 WE 01/18/20 4 WE 02/15/20 4 WE 03/14/20 4 WE 04/11/20 4 WE 05/09/20 4 WE 06/06/20 4 WE 07/04/20 4 WE 08/01/20 4 WE 08/29/20 450 71 4 WE 09/26/20 ACV 0 10 20 30 40 50 60 70 80 12
Share Growth Share of Record Track Shakes Strong RTD Protein Premier 13.5 18.0 22.5 8.7% 0.0 4.5 9.0 Nielsen Nielsen Notes: 12/31/16 xAOC+C 01/28/17 02/25/17 04/01/17 month ending September 26, 2020. 26, September ending month 04/29/17 05/27/17 07/01/17 7/29/2017 08/26/17 09/30/17 10/28/17 11/25/17 Share% $ Monthly 12/30/17 01/27/18 02/24/18 03/31/18 04/28/18 05/26/18 06/30/18 07/28/18 08/25/18 xAOC+C 09/29/18 10/27/18 constraints 11/24/18 Supply 12/29/18 01/26/19 Liquids 2/23/2019 03/30/19 04/27/19 05/25/19 06/29/19 07/27/19 08/24/19 09/28/19 10/26/19 11/23/19 12/28/19 01/25/20 02/22/20 03/28/20 04/25/20 05/23/20 06/27/20 07/25/20 08/22/20 09/26/20 18.3% 13
