Kellogg Company February 21, 2018 Boca Raton February 21, 2018 Deploy For Growth Forward-Looking Statements This presentation contains, or incorporates by reference, “forward-looking statements” with projections concerning, among other things, the Company’s global growth and efficiency program (Project K), the integration of acquired businesses, the Company’s strategy, zero-based budgeting, and the Company’s sales, earnings, margin, operating profit, costs and expenditures, interest expense, tax rate, capital expenditure, dividends, cash flow, debt reduction, share repurchases, costs, charges, rates of return, brand building, ROIC, working capital, growth, new products, innovation, cost reduction projects, workforce reductions, savings, and competitive pressures. Forward-looking statements include predictions of future results or activities and may contain the words “ expects,” “ believes,” “ should,” “ will,” “ anticipates,” “ projects,” “ estimates,” “ implies,” “ can,” or words or phrases of similar meaning. The Company’s actual results or activities may differ materially from these predictions. The Company’s future results could also be affected by a variety of factors, including the ability to implement Project K (including the exit from its Direct Story Delivery system) as planned, whether the expected amount of costs associated with Project K will differ from forecasts, whether the Company will be able to realize the anticipated benefits from Project K in the amounts and times expected, the ability to realize the benefits from our implementation of a more formal Revenue Growth Management discipline, the ability to realize the anticipated benefits and synergies from the acquisitions in the amounts and at the times expected, the impact of competitive conditions; the effectiveness of pricing, advertising, and promotional programs; the success of innovation, renovation and new product introductions; the recoverability of the carrying value of goodwill and other intangibles; the success of productivity improvements and business transitions; commodity and energy prices; labor costs; disruptions or inefficiencies in supply chain; the availability of and interest rates on short-term and long-term financing; actual market performance of benefit plan trust investments; the levels of spending on systems initiatives, properties, business opportunities, integration of acquired businesses, and other general and administrative costs; changes in consumer behavior and preferences; the effect of U.S. and foreign economic conditions on items such as interest rates, statutory tax rates, currency conversion and availability; legal and regulatory factors including changes in food safety, advertising and labeling laws and regulations; the ultimate impact of product recalls; business disruption or other losses from war, terrorist acts or political unrest; and other items. Forward-looking statements speak only as of the date they were made, and the Company undertakes no obligation to update them publicly. This presentation includes non‐GAAP financial measures. Please refer to the Appendices for a reconciliation of these non‐GAAP financial measures to the most directly comparable GAAP financial measures. Management believes that the use of such non-GAAP measures assists investors in understanding the underlying operating performance of the company and its segments. 2 CAGNY 2018 I DEPLOY FOR GROWTH 1 of 24
Kellogg Company February 21, 2018 Reasons to Believe Special Commitment and Sound Financial Food, Brands, Ideas for Growth Footing & Culture • • • Health & Wellness heritage Reduced cost structure Better commercial plans • • • In most households Improving top-line performance Increased investment • • • Taste, convenience, Durable cash flow New growth platforms nutrition, affordability • Weighted toward snacking • Will to win 3 CAGNY 2018 I DEPLOY FOR GROWTH Agenda • Foundation for Growth • Current Trajectory for Growth • Deploy for M ore Growth • A Realistic Algorithm for Growth 4 CAGNY 2018 I DEPLOY FOR GROWTH 2 of 24
Kellogg Company February 21, 2018 Big, Strong, Relevant Brands 2017 Net Sales, $ in Billions, Global >$1 billion $0.5-1.0 billion $0.3-0.5 billion 5 CAGNY 2018 I DEPLOY FOR GROWTH A Health & Wellness Company 6 CAGNY 2018 I DEPLOY FOR GROWTH 3 of 24
Kellogg Company February 21, 2018 A Snacking Company Composition of Net Sales, Total Company 7 CAGNY 2018 I DEPLOY FOR GROWTH A Global Company Composition of Kilos, Total Company 8 CAGNY 2018 I DEPLOY FOR GROWTH * Shaded area represents percentage of volume associated with Joint Ventures, if we were to include our share of their kilos. 4 of 24
Kellogg Company February 21, 2018 Increasing Emerging M arkets Scale & Portfolio Kellogg Emerging Markets, Volume in Kilos J oint Ventures 6.8% CAGR 2013-2017 Snacks: Snacks: 43% of Volume 19% of Volume x-J Vs x-J Vs 9 CAGNY 2018 I DEPLOY FOR GROWTH Agenda • Foundation for Growth • Current Trajectory for Growth • Deploy for Growth • A Realistic Algorithm for Growth 10 CAGNY 2018 I DEPLOY FOR GROWTH 5 of 24
Kellogg Company February 21, 2018 Assessing Growth – Portfolio Segments Net Sales, 2017 * Excludes joint ventures Growing, larger scale Emerging * M arkets Already growing Stabilizing Developed Developed M arkets – M arkets – Frozen Cereal Developed M arkets – Snacks Returning to growth 11 CAGNY 2018 I DEPLOY FOR GROWTH Developed M arkets Cereal Recent Past Current Progress Path Forward • Consumers to protein • Stabilized Canada, U.K., • Expanding occasions • Special K decline • Influencing food beliefs Australia • Stabilizing Special K • New pack formats • Expanding granola • Executing playbook • Channels expansion 12 CAGNY 2018 I DEPLOY FOR GROWTH 6 of 24
Kellogg Company February 21, 2018 Developed M arkets Snacks Recent Past Current Progress Path Forward • Special K decline • Pringles global growth • Increased Brand Building • DSD declining ROI • Transition from DSD • New pack formats • Rationalizing tail SKUs • RXBAR growth platform 13 CAGNY 2018 I DEPLOY FOR GROWTH Developed M arkets Frozen Current Progress Recent Past Path Forward • Portfolio trimmed for • Strong growth • On-trend categories • Innovation/ renovation • Focus on core focus 14 CAGNY 2018 I DEPLOY FOR GROWTH 7 of 24
Kellogg Company February 21, 2018 Emerging M arkets * Excludes joint ventures * Current Progress Recent Past Path Forward • Organic growth • Lacked scale • Pringles expansion • Pringles expansion • Granola & wholesome snacks • Limited portfolio • Challenging macro • Brazil & Egypt acquisitions • New pack formats • Joint Ventures growth • M&A environment 15 CAGNY 2018 I DEPLOY FOR GROWTH Path to Low Single-Digit Sales Growth Net Sales Growth, Currency-Neutral Current Trajectory ~+1% +M SD Stable +LSD “Deploy +1-3% For Growth” +LSD 16 CAGNY 2018 I DEPLOY FOR GROWTH 8 of 24
Kellogg Company February 21, 2018 Agenda • Foundation for Growth • Current Trajectory for Growth • Deploy for M ore Growth • A Realistic Algorithm for Growth 17 CAGNY 2018 I DEPLOY FOR GROWTH Deploy For Growth 18 CAGNY 2018 I DEPLOY FOR GROWTH 9 of 24
Kellogg Company February 21, 2018 Getting the Food Right Win Through Occasions • Removing “negatives” • Adding “positives” • Taste is still king 19 CAGNY 2018 I DEPLOY FOR GROWTH Getting the Packaging Right Win Through Occasions Single-Serve, Share of Category, Across All Kellogg U.S. Categories 12.4% 7.2% 2016 2017 2016 2017 Source: Nielsen AOD – xAOC+ Convenience – Calendar Years 20 CAGNY 2018 I DEPLOY FOR GROWTH 10 of 24
Kellogg Company February 21, 2018 Building a Stronger Innovation Pipeline Win Through Occasions 21 CAGNY 2018 I DEPLOY FOR GROWTH Investing Where the Growth Is Shape a Growth Portfolio Accelerated Growth in ‘17 20+ Years of Growth Global Expansion +DD Consumption Growth +DD Consumption in ‘17 +DD Consumption Growth in ‘17 Growth in ‘17 22 CAGNY 2018 I DEPLOY FOR GROWTH 11 of 24
Kellogg Company February 21, 2018 M &A For Growth & Scale Shape a Growth Portfolio 2017 Net Sales: +Double Digits * 2017 Net Sales: +Triple Digits 2017 Net Sales: +Double Digits * 2017 Net Sales: +Double Digits 23 * Year-on-Year growth since acquisition, currency-neutral CAGNY 2018 I DEPLOY FOR GROWTH Big Ideas, Big Events Create World Class M arketing Consumption +DD Weeks before and after Super Bowl (U.S. Pringles ) 24 CAGNY 2018 I DEPLOY FOR GROWTH 12 of 24
Kellogg Company February 21, 2018 Customized M essaging Create World Class M arketing W hen you watch videosabout the latest new W hen you watch avideo about how to cook aturkey tech gadgets Consumption +10% W hen you watch avideo about kid friendlycrafts W hen you watch a video about kid friendlymeals Latest 13 weeks (U.S. Rice Krispies Treats ) 25 CAGNY 2018 I DEPLOY FOR GROWTH Brand Experience & Conversation Create World Class M arketing Consumption +12% in 2017 (U.K. Corn Flakes ) 26 CAGNY 2018 I DEPLOY FOR GROWTH 13 of 24
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