bull Brand Marketing Overview - Howard Brandeisky Sr VP Global Marketing amp Customer Solutions
Some of the statements in this presentation and any statements by management constitute ldquoforward-looking statementsrdquo about John B Sanfilippo amp Son Inc Such statements include in
particular statements about our plans strategies business prospects changes and trends in our business and the markets in which we operate In some cases you can identify forward-looking statements by the use of words such as ldquomayrdquo ldquowillrdquo ldquocouldrdquo ldquowouldrdquo ldquoshouldrdquo ldquoexpectrdquo ldquoplanrdquo
ldquoanticipaterdquo ldquointendrdquo ldquobelieverdquo ldquoestimaterdquo ldquoforecastrdquo ldquopredictrdquo ldquoproposerdquo ldquopotentialrdquo or ldquocontinuerdquo or the negative of those terms or other comparable terminology These statements
represent our present expectations or beliefs concerning future events and are not guarantees Such statements speak only as of the date they are made and we do not undertake any
obligation to update any forward-looking statement
We caution that forward-looking statements are qualified by important factors risks and uncertainties that could cause actual results to differ materially from those in the forward- looking statements Our periodic reports filed with the Securities and Exchange Commission including our Forms 10-K and 10-Q and any amendments thereto describe some of these factors risks
and uncertainties
Forward-Looking Statements
3
bull One of the largest nut processors in the world with fiscal year 2017 net sales of approximately $847 million
bull State-of-the-art nut processing capabilities including what we believe is the single largest nut processing facility in the world
bull A North American market leader in every major selling channel ndash from consumer and commercial ingredient customers to contract manufacturing customers
bull Dual consumer strategy of offering branded nut and dried fruit programs (Fisher and Orchard Valley Harvest) and private brands
bull Commodity procurement expertise with buyers averaging over 20+ years experience
bull A category leader in packaging and product innovation
bull Vertically integrated nut processing operation for pecans peanuts and walnuts
JBSS Corporate Overview
4
We Are Experts In Every Nut Type
of total gross sales
Full assortment of nut types
Full variety of value-added products
Wide variety of dried fruit and other snack products
Customized unique product formulas
Fiscal Year 2017
16
16
249
16
145 PEANUTS
PECANS
CASHEWS amp MIXED NUTS
WALNUTS
ALMONDS
TRAIL amp SNACK MIXES
OTHER
5
6
Consistent Success Over Past 6 Fiscal Years
158
198
236
261 268
317
0
05
1
15
2
25
3
35
FY 12 FY 13 FY 14 FY 15 FY 16 FY 17
DILUTED EPS FY 12 - FY 17
Doubled Diluted EPS from FY 12 to FY 17
$650000
$700000
$750000
$800000
$850000
$900000
$950000
$1000000
FY 12 FY 13 FY 14 FY 15 FY 16 FY 17
Net Sales FY 12 - FY 17
In thousands
$846635
Net Sales increased by approximately 21 from FY 12
Yield based on average yearly stock price CY 17 through 91917
$050 $100
$150 $150 $200
$500
$200
69 70
52
41
88
38
00
10
20
30
40
50
60
70
80
90
100
0
1
2
3
4
5
6
2012 2013 2014 2015 2016 2017
Cash Dividends Paid by Calendar Year
Regular Dividend Special Dividend Yield
DividendsYield
7
VisionTo be the global source for
nuts committed to quality
expertise and innovation that
delivers an unmatched
experience to our customer
and consumer
Core ValuesPeople
IntegrityInvestment
Customer DrivenQuality
InnovationExecution
Continuous ImprovementSafety
Resource Conservation
8
FY 2017 RESULTS
9
10
Fisher recipe nuts continued its share leadership of the recipe nut category by increasing pound market share by +40 points
Increased market share and distribution in the produce nut category with Orchard Valley Harvest products
FY 2017 Accomplishments
Source IRI FY Ending 62517 Total US MULO for Recipe Nuts Fisher Core (Milwaukee Minneapolis Chicago and St Louis) MULO for Fisher Snack 11
Launched over 60 new items with our private brand partners
Expanded Fisher brand awareness and distribution in the Commercial Ingredients channel
Obtained new snack bite business with our contract packing customers to fully utilize our cluster line in FY 2018
FY 2017 Accomplishments
12
Launched 100+ Fisher and Orchard Valley Harvest products on eCommerce sites
Expanded Fisher and Orchard Valley Harvest in vending
Started testing in Dollar Store channel
FY 2017 Accomplishments
13
SALES CHANNEL UPDATES
14
Commercial Ingredients
19
Contract Pkg18
Consumer 63 $530
Fiscal 2017 Net Sales $847 Million
Business Channel Diversification
(Millions of $)
$165
$152
15
Chart1
East
Commercial Ingredients19
Contract Pkg18
Consumer 63
Export9
019
0178
0626
Sheet3
Sheet1
Sheet2
Consumer63
Fiscal 2017 Net Sales $530 Million
FY 2017 Consumer Channel
vs FY 16
-64
16
Commercial Ingredients
19
Fiscal 2017 Net Sales $165 Million
FY 2017 Commercial Ingredients Channel
vs FY 16
-326
17
Chart1
East
Commercial Ingredients19
Export9
24
10
61
5
Sheet1
75vs FY 16
Contract Packaging 18
FY 2017 Contract Packaging Channel
Fiscal 2017 Net Sales $152 Million18
Chart1
75vs FY 16
Contract Packaging 18
East
24
10
61
5
Sheet1
NUT CATEGORY REVIEW
19
$463
$524 $554 $562
$585 $607 $601
FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017
Price Per Pound
Slight decline in Nut Commodity Prices after Years of Increases
Source IRI Nut Category ndash Multi Outlet Geography Time Periods Total FY 11 Year Ending 7311 to FY 2017 data ending 62517
1 decline in FY 17 but average prices still up 30+ since
FY 11
20
Chart1
Price Per Pound Category
Price Per Pound
463
524
554
562
585
607
601
Sheet1
4340
37
27 26
21
14 13
CASHEW MIXED NUT ALMOND MACADAMIANUT
PISTACHIO PECAN WALNUT PEANUT
Increase in Price Per Pound Since FY 11
Retail Prices Up Across Most Major Nut Types over the Last 6 Years
Source IRI Total Nut Category ndash Multi Outlet Geography Time Periods FY 11 Year Ending 7311 to FY 2017 data ending 62517 21
Chart1
Change
Increase in Price Per Pound Since FY 11
-13
043
04
037
027
026
021
014
013
Sheet1
4771
53055659
59086120 6261 6280
FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017
Category $ Sales (M)
Category Dollar Sales Plateaued after Years of Growth
1030
10141022
10511046
1031
1044
FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017
Category Pound Sales (M)
Source IRI Total Nut Category ndash Multi Outlet Geography Time Periods FY 11 Year Ending 7311 to FY 2017 data ending 62517 22
Chart1
Category 1
Category $ Sales (M)
4771
5305
5659
5908
6120
6261
6280
Sheet1
Chart1
Category 1
Category Pound Sales (M)
1030
1014
1022
1051
1046
1031
1044
Sheet1
FY 2017 FINANCIAL MILESTONES
23
$0
$25
$50
$75
$100
$125
$150
$175
$200
$225
$250
$275
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
In millions of $
92 CAGR over 255 Years
24
JBSS Stockholdersrsquo Equity FY 1991-2017
Chart1
25
32
69
68
76
73
73
78
80
87
94
102
119
181
196
180
163
158
165
180
184
201
215
227
241
251
235
Sheet1
$0
$200
$400
$600
$800
$1000
$120019
91
1992
1993
1994
1995
1996
1997
(6 M
O)
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
Increased Pound Volume and Prices
De-emphasizedIndustrial Sales Lower
Prices
Low Carb Diet Run Up
$847million
In millions of $
Decreased prices and volume67 CAGR over 255 Years
25
JBSS Net Sales FYs 1991-2017
Chart1
165
193
204
209
277
293
132
312
313
327
342
353
420
521
582
580
541
542
554
562
674
701
734
779
887
952
847
Sheet1
$0
$20
$40
$60
$80
$100
$120
$140
$160
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
In millions of $
Facility Consolidation Project 608 decline in total debt since 2007
26
JBSS Total Outstanding Debt FYs 1991-2017
Chart1
TTL DEBT
50
76
71
107
107
98
93
115
100
99
89
70
70
19
144
138
148
133
94
99
101
95
74
80
97
44
58
Sheet1
Sheet2
00
50
100
150
200
250
300
350
400
450
500
550
600
650
700
750
27
JBSS Total Outstanding Debt as of Net SalesFYs 1991-2017
Chart1
Total Outstanding Debt As of Net Sales
0303
0394
0348
0512
0386
0334
0705
0369
0319
0303
026
0198
0167
0036
0247
0238
0274
0245
017
0176
015
0135
0101
0102
0109
00467
0069
Sheet1
Sheet2
EBITDAEBITDA consists of earnings before interest taxes depreciationamortization and noncontrolling interest EBITDA is not a measurementof financial performance under accounting principles generallyaccepted in the United States of America (GAAP) and does notrepresent cash flow from operations EBITDA is presented solely as asupplemental disclosure because management believes that it isimportant in evaluating JBSSs financial performance and marketvaluation In conformity with Regulation G a reconciliation of EBITDAto the most directly comparable financial measures calculated andpresented in accordance with GAAP is presented in the following slide
28
FY 2007 FY 2008 FY 2009 FY 2010 FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017
(in $000s)
NET INCOME (LOSS) (13577) (5957) 6917 14425 2835 17122 21760 26287 29305 30395 36125
INTEREST EXPENSE 9347 10502 7646 5653 6444 5364 4754 4354 3966 3492 2910
INCOME TAX EXPENSE (BENEFIT) (7520) (897) (259) 8447 (49) 9099 13536 13545 15559 16067 18013
DEPRECIATION AMORTIZATION 13584 15742 15922 15825 16968 17117 16717 16278 16284 16585 15559
EBITDA 1834 19390 30226 44350 26198 48702 56767 60464 65114 66539 72607
NET SALES 540858 541771 553846 561633 674212 700575 734334 778622 887245 952059 846635
EBITDA MARGIN ( OF NET SALES) 03 36 55 79 39 70 77 78 73 70 86
POUNDS SOLD (000S) 246142 221958 217465 224302 232746 212553 221762 240417 253514 270144 260123
EBITDA PER POUND SOLD 0007 0087 0139 0198 0113 0229 0256 0251 0257 0246 0279
29
Reconciliation of Net Income (Loss) to EBITDA
EBITDA is a non-GAAP measure See slide entitled ldquoReconciliation of Net Income (Loss) to EBITDArdquo for reconciliation to GAAP measure(in $ thousands)
-
10000
20000
30000
40000
50000
60000
70000
80000
FY 2013 FY 2014 FY 2015 FY 2016 FY 2017
EBITDA
0220
0230
0240
0250
0260
0270
0280
0290
FY 2013 FY 2014 FY 2015 FY 2016 FY 2017
EBITDA PER POUND SOLD
30
EBITDA Trends
31
Net Sales ($7502) (34)
Sales Volume (Lbs Sold)
0 0
Gross Profit $(1635) (45)
Net Income $252 25
Earnings Per Share (Diluted)
$002 22
Operating Cash Flows $(18170) (437)
Total Debt $31812 981
32
Change Change
Financial Highlights Q1 FY 2018 vs Q1 FY 2017(in 000rsquos except EPS)
FY 2017 BRAND MARKETING OVERVIEW
33
Snack Nuts
Grow Brands
Recipe Nuts
34
Recipe Nuts
35
Continued Growth for Fisher Recipe in FY 17Total Fisher Recipe Brand Growth FY 17 vs FY 16
+5
+11
DOLLAR NET SALES POUND SALES
Source JBSS shipment data 52 week versus 52 week comparison
Recipe Nuts
36
Fisher Recipe has Increased Market Share
156180
201227
267
FY 2013 FY 2014 FY 2015 FY 2016 FY 2017
Fisher Recipe Pound Share Total US MULO
Source IRI Total Recipe Nut Category ndash Multi Outlet Geography ndash FY 2013 - 2017 Data Ending 62517 37
Chart1
Fisher Recipe Pound Share
Fisher Recipe Pound Share Total US MULO
0156091568
01796142476
02012141084
02268737256
0267
Sheet1
National Distribution
Hawaii
Distribution Resulted in Share Gains for Fisher Recipe Nuts
As of 71917
38
Continue to Build Fisher Brand Equity with Food Network Sponsorship
39
Integrated Marketing Key to Building Brand Equity
Multi-Platform Food Network Partnership
Influencer Marketing
National Print
In-Store Support
Content Social Media and Web
Original PR photo content created and photographed by the Fisher Fresh Thinkers Influencer Network 40
Product Upsizing along with Improved Nut Variety and Size Communication
41
