#SustainableGrowth #Innovation #SaltySnacks #UtzBrands #InvestorDay #SupplyChainTransformation #FinancialTargets #IndustryEvolution
The snack industry, a cornerstone of American culture, is undergoing a transformation, and Utz Brands is at the forefront of this evolution. Utz, known for iconic brands like Utz, Zapp’s, Boulder Canyon, and On The Border, recently shared its ambitious plans for sustainable growth and innovation at Investor Day.
Portfolio Strategy:
Utz is committed to meeting diverse consumer needs through a focused brand portfolio. The company plans to accelerate investments in marketing and innovation, aiming for top-line growth and share gains in the Salty Snack category. By emphasizing Power Brands, including Utz®, Zapp’s®, Boulder Canyon®, and On The Border®, Utz is poised to outpace industry growth.
Expansion Geographies and Untapped Channels:
Recognizing significant distribution opportunities beyond its core geography, Utz is gearing up for further brand expansion. Efforts will be directed at both expansion geographies and retaining market share in core regions, showcasing a comprehensive approach to growth.
Supply Chain Transformation:
Utz envisions a more cost-efficient and flexible supply chain. With a focus on continuous improvement projects and network optimization, the company expects to achieve $135 million in cost savings over the next three years. This initiative not only enhances efficiency but also provides the necessary capacity for future growth.
Leading Capabilities:
Utz boasts a dynamic, hybrid go-to-market model with a broad distribution network. The company plans to strengthen its independent operator Direct Store Distribution system to improve execution and generate higher returns. This, coupled with other organizational enhancements, ensures Utz remains at the forefront of industry capabilities.
Improved Balance Sheet Flexibility:
Maintaining financial resilience, Utz plans to accelerate cash generation and adhere to a disciplined capital allocation approach, reducing leverage. Acquisitions will be pursued opportunistically, ensuring a balance between growth and financial stability.
Financial Outlook:
Utz reaffirms its fiscal year 2023 outlook, projecting net sales growth of 2% to 3%, organic net sales growth of 3% to 4%, and adjusted EBITDA growth of 8% to 11%. The company also aims for a net leverage ratio below 4.5x by the end of fiscal year 2023.
Three-Year Financial Targets:
Looking ahead, Utz introduces ambitious three-year financial targets, including 4% to 5% organic net sales growth, a ~16% adjusted EBITDA margin by FY 2026, and double-digit annual adjusted earnings per share growth. The company targets a net leverage ratio of ~3x by the end of 2026, showcasing Utz’s confidence in sustained, robust growth.
Utz’s strategic vision unveiled at Investor Day outlines a future where sustainability, innovation, and strategic investments drive growth. The focus on portfolio strength, expansion, and supply chain efficiency positions Utz as a key player in shaping the future of the Salty Snacks industry.
