Attached files
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| 8-K - FORM 8-K - Hillshire Brands Co | d406586d8k.htm |
 Barclays
Back To School Conference
Sean Connolly, CEO
Maria Henry, CFO
September 5, 2012
Exhibit 99 |
 Forward Looking
Statements We caution you that our remarks today may contain forward-looking
statements about Hillshire Brands’
future operations, financial performance, and business
conditions. These forward-looking statements are based on currently available
competitive, financial, and economic data, as well as management’s views and
assumptions regarding future events. Such forward-looking statements are inherently
uncertain, and investors must recognize that actual results may differ from those
expressed or implied in these statements. Consequently, we caution you not to place
undue reliance on forward-looking statements. We have provided additional
information in past Hillshire Brands’
press releases and the Form 10-K, which we
encourage you to review concerning factors that could cause actual results to differ
materially from these forward-looking statements.
2
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 FY12
Results Barclays Back to School Conference
3
FY11
FY12
YoY
Adjusted Net Sales
3,884
4,039
+4.0%
Adjusted Gross Profit
1,173
1,148
(2.1)%
Adjusted Gross Margin
30.2%
28.4%
(180) Bps
Adjusted MAP
122
137
+12.9%
Adjusted Op Seg Income
414
396
(4.7)%
Adjusted Op Seg Margin
10.7%
9.8%
(90) Bps
Adjusted Diluted EPS
$1.20
$1.47
+23%
Continuing operations
($ millions, excludes significant items)
Note: Preliminary, pending filing of the 10-K
“Adjusted”
numbers are non-GAAP financial measures. See our reconciliation to the most directly
comparable GAAP measure at the end of this presentation. |
 Pro Forma EPS
Reflects Our New Organization and Capital Structure
Continuing
operations
(excludes
significant
items)
4
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FY11
FY12
Adjusted Diluted EPS
$1.20
$1.47
Exited Businesses
(0.02)
(0.04)
Corporate
0.16
(0.01)
Net Interest
0.25
0.17
Tax Rate
(0.01)
(0.04)
Pro Forma Diluted EPS
$1.58
$1.55
Note: Preliminary, pending filing of the 10-K
“Adjusted”
and “Pro Forma”
numbers are non-GAAP financial measures. See our reconciliation to the most directly
comparable GAAP measure at the end of this presentation.
“Pro Forma Diluted EPS”
is a non-GAAP financial measure calculated excluding the impact of significant items,
exited businesses, and using estimated FY13 assumptions for corporate costs of $70
million, net interest expense of $40 million, and a tax rate of 35%. |
 Volumes
Stabilized in Second Half Barclays Back to School Conference
5
Organic Volume* YOY% change from FY11 to FY12
* Organic volume excludes exited businesses and non-comparable periods for acquired
businesses (6.2)%
(3.9)%
(0.3)%
0.2%
Q1
Q2
Q3
Q4 |
 Pricing and
Commodities Moderated in Second Half FY11 Excludes Australia
(10)
(15)
+11
(5)
Pricing
Commodities
$ millions
6
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208
110
53
162
(218)
(125)
(42)
(167)
FY11
FY12 H1
FY12 H2
FY12 |
 FY13
Guidance Barclays Back to School Conference
7
Guidance
Perspective
Conviction to invest in strategic areas
Some weak spots in the portfolio
Transition year: more variability in outcome
Adjusted EPS $1.40 -
$1.55
Net sales in line with FY12 |
 Conservative
Capital Structure Barclays Back to School Conference
8
$ millions
FY12 YE Cash Balance
$235
FY12 YE Debt Balance
$944
Legacy Cash Obligation
$190-210
Net Interest Expense
$35-40
Dividend Payout Ratio
32-36%
Note: Dividend payout ratio based on Adjusted EPS Guidance |
 Capital
Allocation Barclays Back to School Conference
9
Top priority
Expect to increase over time
Strategic and opportunistic
Not in the near term
Low priority
Invest in Business
Dividends
Acquisitions
Share Repurchases
Pay Down Debt |
 Significant
Value Creation Opportunity Barclays Back to School Conference
10
Volume Growth
2-3%
Net Sales Growth
4-5%
MAP % of Total Revenue
5%
Operating Margin
10%
2015 TARGETS |
 Appendix
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11 |
 ($ in
millions) As
Reported
Impact of
Significant
Items
Disp.
Adjusted (1)
As
Reported
Impact of
Significant
Items
Disp.
Adjusted (1)
Net Sales
4,094
$
-
$
55
$
4,039
$
4,019
$
-
$
135
$
3,884
$
Cost of Sales
2,961
30
40
2,891
2,824
2
112
2,710
Gross Profit
1,133
(30)
15
1,148
1,195
(2)
23
1,174
MAP Expense
137
-
-
137
124
-
2
122
SG&A (excluding MAP)
628
6
7
615
656
-
18
638
Net charges for exit activities, asset
and business dispositions
17
17
-
-
14
14
-
-
Impairment Charges
-
-
-
-
15
15
-
-
Operating Segment Income
351
$
(53)
$
8
$
396
$
386
$
(31)
$
3
$
414
$
(1) Adjusted numbers are non-GAAP financial measures.
Fiscal Year ended June 30, 2012
Fiscal Year ended July 2, 2011
Operating Segment Income Reconciliation –
Reported
to Adjusted (Fiscal Year 2012)
12 |
 Reconciliation
of Earnings per Share – Continuing Ops
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13
Reconcilation of Earnings per share - Continuing businesses to Adjusted and Proforma
($ in Millions, except EPS)
Reported
Less:
Impact of
Significant
Items
Adjusted(1):
Excluding
Significant
Items
Less:
Disp.
Proforma
Adjs
Proforma(2)
Op Seg Income
351
(53)
404
8
396
Corporate Expenses
277
208
69
-
1
70
Operating Income
74
(261)
335
8
(1)
326
Interest Expense - net
72
-
72
(32)
40
Debt Extinguishment costs
39
(39)
-
-
-
Income before Tax
(37)
(300)
263
8
31
286
Income tax expense/(benefit)
(15)
(103)
88
3
15
100
Net Income
(22)
(197)
175
5
16
186
Diluted Shares
119
120
120
120
120
120
Diluted EPS
($0.18)
($1.65)
$1.47
$0.04
$0.12
$1.55
Preliminary results pending the filing of the Company's 10-K
(2) Proforma EPS is a non-GAAP finanical measure excluding the impact of Significant
Items, Exited businesses and using estimated FY13 assumptions for Corporate costs of
$70M, Net Interest Expense of $40M and a tax rate of 35% Fiscal Year ended June 30,
2012 (1) Adjusted EPS is a non-GAAP financial measure excluding the impat of
Significant Items |
 Reconciliation
of
Earnings
per
Share
–
Continuing
Ops
Barclays Back to School Conference
14
Reconcilation of Earnings per share - Continuing businesses to Adjusted and Proforma
($ in Millions, except EPS)
Reported
Less:
Impact of
Significant
Items
Adjusted(1):
Excluding
Significant
Items
Less:
Disp.
Proforma
Adjs
Proforma (2)
Op Seg Income
386
(31)
417
3
414
Corporate Expenses
161
60
101
-
(31)
70
Operating Income
225
(91)
316
3
31
344
Interest Expense - net
87
-
87
(47)
40
Debt Extinguishment costs
55
55
-
-
-
Income before Tax
83
(146)
229
3
78
304
Income tax expense/(benefit)
27
(53)
80
1
27
106
Net Income
56
(93)
149
2
51
198
Diluted Shares
125
125
125
125
125
125
Diluted EPS
$0.45
($0.75)
$1.20
$0.02
$0.40
$1.58
(2) Proforma EPS is a non-GAAP finanical measure excluding the impact of Significant
Items, Exited businesses and using estimated FY13 assumptions for Corporate costs of
$70M, Net Interest Expense of $40M and a tax rate of 35% Fiscal Year ended July 2,
2011 (1) Adjusted EPS is a non-GAAP financial measure excluding the impat of
Significant Items Preliminary results pending the filing of the Company's 10-K
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