The following is a summary of the Nomad Foods Limited (NOMD) Q4 2023 Earnings Call Transcript:
Financial Performance:
Nomad Foods' Q4 organic sales grew by 1.9%, with net revenue of €761 million.
Adjusted EBITDA was €117 million with adjusted EPS of €0.32, both exceeding expectations.
Improvements were observed in both quarterly and annual gross margins, with the latter improving to 28.2%.
The company generated nearly €174 million of free cash flow in Q4, and €300 million throughout 2023.
For 2024, the company anticipates organic sales growth of 3% to 4%, EBITDA growth of 4% to 6%, and EPS growth of 9% to 12%.
Nomad Foods initiated a quarterly cash dividend of €0.15 per share and announced a $500 million share repurchase program.
Business Progress:
Nomad increased advertising and promotion spending by nearly 30% in Q4 and plans to continue doing so in 2024.
The company is focusing on better retail execution and productivity increase, targeting works in data and analytics capabilities, especially in its supply chain.
Strategically, Nomad is collaborating with key suppliers for product innovation and risk reduction in procurement, which also helps in savings.
An expectation of sustained growth in 2024 and beyond is predicted with targets for organic revenue growth, adjusted EBITDA growth, adjusted EPS growth, and cash conversion.
Nomad forecasts net revenue growth of 3% to 4%, adjusted EBITDA growth of 4% to 6%, and adjusted EPS of €1.75 to €1.80 per share in 2024.
To support volume and share performance in 2024, an increase in advertising & promotional spending is planned, which already rose by approximately 13% in 2023.
The company intends to continue returning capital to shareholders through dividends and share repurchases, backed by a consistent strong cash flow.
Nomad expressed confidence in their ability to deliver leading growth in the food sector for 2024 and beyond.
More details: Nomad Foods IR
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