Nomad Foods Reports Second Quarter 2020 Financial Results

Company raises 2020 Adjusted EBITDA guidance, which is now expected to be in excess of €460 million

2020 Adjusted EBITDA guidance now includes approximately €10 million of incremental strategic investments

Nomad Foods Limited (NYSE: NOMD), today reported financial results for the three and six month periods ended June 30, 2020.  Key operating highlights and financial performance for the second quarter of 2020, when compared to the second quarter 2019, include:

• Reported revenue increased 11.4% to €599 million
• Organic revenue growth of 12.3%
• Reported Profit for the period of €63 million
• Adjusted EBITDA increased 21% to €119 million
• Adjusted EPS increased 26% to €0.34

Management Comments
Stéfan Descheemaeker, Nomad Foods’ Chief Executive Officer, stated, “We experienced continued robust demand throughout the second quarter, even as restrictions were relaxed across Europe beginning in early May. Frozen food has proven to be one of the most durable consumer categories throughout the COVID-19 pandemic, a testament to its role in offering families quick and nutritious meal solutions at home. These are values which we believe will transcend beyond this acute period and appeal to a broader set of consumers in a post-COVID-19 world. As Europe’s leading frozen food company, we believe Nomad Foods is uniquely positioned with the strategy, resources and execution discipline to accelerate growth and drive sustained value creation for our stakeholders.”

Noam Gottesman, Nomad Foods’ Co-Chairman and Founder, commented, “We are pleased with our strong first half 2020 performance and now expect that second half organic revenue growth will remain elevated. This leads us to raise our guidance while also enabling us to accelerate strategic investments to convert the unprecedented adoption of frozen food and trial of our brands into permanent consumption behavior.”

Second Quarter of 2020 results compared to the Second Quarter of 2019

• Revenue increased 11.4% to €599 million. Organic revenue growth of 12.3% was comprised of 9.9% growth in volume/mix and 2.4% increase in price.
• Gross profit increased 13% to €181 million. Gross margin increased 50 basis points to 30.3% as reduced promotions, fixed cost leverage and favorable mix offset cost of goods inflation.
• Adjusted operating expenses increased 1% to €79 million as growth in Indirect expenses was offset by a double-digit decline in Advertising & Promotion.
• Adjusted EBITDA increased 21% to €119 million and Adjusted Profit after tax increased 29% to €68 million due to the aforementioned factors.
• Adjusted EPS increased 26% to €0.34, which includes the impact of a lower share count resulting from the repurchase of ordinary shares during the first half of 2020. Reported EPS increased 33% to €0.32.

First Six Months of 2020 results compared to the First Six Months of 2019

• Revenue increased 10.9% to €1,282 million. Organic revenue growth of 9.8% was comprised of 7.9% growth in volume/mix and 1.9% increase in price.
• Gross profit increased 8% to €380 million. Gross margin declined 70 basis points to 29.7% as pricing, promotional efficiencies and mix were more than offset by cost of goods inflation.
• Adjusted operating expenses increased 7% to €176 million as double digit growth in Indirects was offset by a decline in Advertising & Promotion.
• Adjusted EBITDA increased 8% to €239 million and Adjusted Profit after tax increased 10% to €135 million due to the aforementioned factors.
• Adjusted EPS increased 2% to €0.67 and Reported EPS increased 49% to €0.55.

2020 Guidance
The Company is raising 2020 guidance, which now includes approximately €10 million of incremental strategic investments to fuel brand building activity, drive targeted retention of new consumers, and further accelerate the growth of Green Cuisine.

2020 Adjusted EBITDA is now expected to be in excess of €460 million.  Adjusted EPS, which does not reflect the potential outcome of the proposed tender offer, is now expected to be in excess of €1.27 EPS. Full year guidance now assumes organic revenue growth at a high-single digit percentage range versus the prior expectation of mid-single digit organic revenue growth.

Conference Call and Webcast
The Company will host a conference call with members of the executive management team to discuss these results today, Thursday, August 6, 2020 at 1:30 p.m. BST (8:30 a.m. Eastern Daylight Time). Investors interested in participating in the live call can dial +1-877-451-6152 from North America. International callers can dial +1-201-389-0879.

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 13706777.

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