Nomad Foods Reports Fourth Quarter and Full Year 2019 Financial Results

Reports fourth quarter and full year organic revenue growth of 1.7% and 2.1%, respectively
Full year Adjusted EBITDA of €432 million and Adjusted EPS of €1.23 exceed prior guidance
Expects another year of organic revenue and Adjusted EBITDA growth in 2020

FELTHAM, England - Nomad Foods Limited (NYSE: NOMD), today reported financial results for the three and twelve-month periods ended December 31, 2019.

Key operating highlights and financial performance for the fourth quarter 2019, when compared to the fourth quarter 2018, include:

Reported revenue increased 2% to €628 million
Organic revenue growth of 1.7%
Reported Profit for the period of €46 million
Adjusted EBITDA increased 15% to €116 million
Adjusted EPS of €0.32

Key operating highlights and financial performance for the full year 2019, when compared to the full year 2018, include:

Reported revenue increased 7% to €2,324 million
Organic revenue growth of 2.1%
Reported Profit for the period of €154 million
Adjusted EBITDA increased 15% to €432 million
Adjusted EPS of €1.23

Management Comments
Stéfan Descheemaeker, Nomad Foods’ Chief Executive Officer, stated, “We are pleased to report another year of solid growth. In 2019, we achieved a third consecutive year of organic revenue growth and exceeded our guidance despite certain external challenges, namely raw material inflation and Brexit uncertainty. We enter 2020 well positioned to deliver another year of profitable growth. Our expansion into Green Cuisine presents an attractive incremental growth opportunity within the fast growing meat-free segment. We also expect our supply chain productivity program to begin to drive meaningful cost savings and fuel growth. Finally, our strong balance sheet and cash flow provide us with the resources and flexibility to execute on our M&A strategy."

Noam Gottesman, Nomad Foods’ Co-Chairman and Founder, commented, “Fourth quarter and full year results reflect the strength and durability of our business model. We have an exciting year ahead and remain well positioned to sustain our growth and continue to meet the needs of our consumers and our retail partners. We look forward to achieving another year of organic revenue growth and remain actively focused on acquisitions which, based on our balance sheet, have the potential to translate into significant earnings power."

Fourth Quarter of 2019 results compared to the Fourth Quarter of 2018

Revenue increased 2.2% to €628 million. Organic revenue growth of 1.7% was comprised of 3.2% growth in price and a 1.5% decline in volume/mix.
Adjusted gross profit increased 2% to €188 million. Adjusted gross margin was unchanged at 29.9% as favorable pricing, promotional efficiencies and mix were offset by cost of goods inflation.
Adjusted operating expenses decreased 6% to €90 million, reflecting a decline in Advertising and promotion expense of 11% to €34 million and Indirect expense of 3% to €56 million.
Adjusted EBITDA increased 15% to €116 million, which included a benefit of €4.5 million related to IFRS 16.
Adjusted Profit after tax increased 22% to €63 million reflecting Adjusted EBITDA growth, lower finance costs and a lower effective tax rate. The impact of IFRS 16 reduced Adjusted Profit after tax by €0.2 million.
Adjusted EPS increased 10% to €0.32. The impact of IFRS 16 was immaterial to this metric. Reported EPS was flat at €0.23.

Year Ended 2019 results compared to the Year Ended of 2018

Revenue increased 7.0% to €2,324 million. Organic revenue growth of 2.1% was comprised of 3.8% growth in price and a 1.7% decline in volume/mix.
Adjusted gross profit increased 5.9% to €698 million. Adjusted gross margin declined 30 basis points to 30.0% as favorable pricing, promotional efficiencies were offset by cost of goods inflation and acquisition mix.
Adjusted operating expenses increased 2% to €334 million, reflecting a decline in Advertising and promotion expense of 1% to €120 million and Indirect expense growth of 3% to €215 million.
Adjusted EBITDA increased 15% to €432 million, which included a benefit of €17.7 million related to IFRS 16.
Adjusted Profit after tax increased 12% to €235 million, reflecting Adjusted EBITDA growth, offset in part by higher finance costs. The impact of IFRS 16 reduced Adjusted Profit after tax by €2.0 million.
Adjusted EPS increased 3.4% to €1.23 as Adjusted Profit growth was partly offset by an increased share count resulting from the public offering of ordinary shares in the first quarter of 2019. The impact of IFRS 16 adversely impacted this metric by €0.01. Reported EPS decreased 19.6% to €0.78.

2020 Guidance
For the full year 2020, Adjusted EBITDA is expected to be approximately €440 to €445 million and EPS approximately €1.19 to €1.21. Full year guidance assumes organic revenue growth at a low-single digit percentage rate.

Conference Call and Webcast
The Company will host a conference call with members of the executive management team to discuss these results today, Thursday, February 27, 2020 at 1:30 p.m. GMT (8:30 a.m. Eastern Daylight Time). Investors interested in participating in the live call can dial +1-800-263-0877 from North America. International callers can dial +1-646-828-8143.

In addition, the call will be broadcast live over the Internet hosted at the “Investor Relations” section of the Company’s website at http://www.nomadfoods.com. The webcast will be archived for 30 days. A replay of the conference call will be available on the Company website for two weeks following the event and can be accessed by listeners in North America by dialing +1-844-512-2921 and by international listeners by dialing +1-412-317-6671; the replay pin number is 3058805.

Nomad Foods Contacts
Investor Relations Contacts
Taposh Bari, CFA
Nomad Foods Limited
+1-718-290-7950

John Mills
ICR, Partner
+1-646-277-1254

Media Contact
Felipe Ucros
Gladstone Place Partners
+1-212-230-5930