Corporate Profiles - 2022 - 84

COMPANY OVERVIEW
Hostess Brands, Inc.
S
weet snacks manufacturer Hostess Brands,
Inc. sees itself in a growing space, a perspective
that allows the company to aim for
mid-single-digit organic revenue growth, 5% to
7% EBITDA growth and 7% to 9% earnings-pershare
growth.
" The $91 billion sweet snacking universe has
grown at an annual rate of 4.8% over the last
three years, " Lenexa, Kan.-based Hostess said. " The
number of consumers eating five or more snacks
per day has increased double digits since 2018. "
To leverage consumers' preference for snacking,
the company is investing in production, innovation
and distribution.
" We are just getting started, " said Andrew P.
Callahan, president and chief executive officer. " We
recognize that success is not just about goals but
sustained and measured progress year after year.
As we look forward, we are confident in our ability
to generate top-tier shareholder returns as we
work to deliver our long-term growth algorithm of
mid-single-digit organic revenue growth, 5% to
7% EBITDA growth and 7% to 9% EPS growth. "
In March, Hostess acquired a new facility in
Arkadelphia, Ark., and said it would invest between
$120 million and $140 million in the
330,000-square-foot facility to transform it into a
" bakery of the future. " Hostess plans to have the
Consumers' increased preference for snacking creates opportunity
plant operational in the second half of 2023.
" It will unlock approximately 20% capacity
across our cake and Donettes platforms and is expected
to support our growth algorithm through
2028 based on current demand projections, " the
company said. " It will also enable continued innovation
across our portfolio and provide the necessary
space to support additional production lines in
the future as we continue to grow beyond 2028. "
Sales of new products launched in 2019 through
2021 accounted for 16% of total sales in 2021,
according to the company.
Recent product introductions included caffeinated
donuts and bite-size snack cakes. Boost Jumbo
Donettes, which contain slightly less caffeine than
one cup of coffee, debuted in two flavors: chocolate
mocha and caramel macchiato.
Hostess Bouncers, a " poppable " take on the
company's classic baked snacks, were rolled out
in three cream-filled versions, including Twinkies,
Ding Dongs and cinnamon Donettes.
In the past year the company managed 14.4%
point-of-sale (POS) growth in the sweet baked
goods category and expanded Voortman distribution,
leading to 18% POS growth.
Hostess remains " very bullish " about the convenience
store channel, said Arist Mastorides, executive
vice president and chief customer officer.
" We're up over 15% in the c-store channel, " he
said. " So we are accelerating our distribution. This
year alone, we've closed over 100,000 distribution
voids. And we've sold about 20% more of the single-serve
display racks. And so while we have really
broad-based distribution, we believe that we're just
getting started. "
In May, Hostess named a new chief financial officer.
Travis Leonard succeeded Mike Gernigin, who
had served as interim CFO since November 2021.
Mr. Leonard has more than 25 years of global financial
executive experience, most recently as
senior vice president and CFO of the medical segment
at Cardinal Health. He also held finance and
corporate audit roles at Cargill and various finance
roles at Kraft Foods.
Hostess named Darryl Riley to be chief sustainability
officer, a new position, in July. He previously
was president of Total Food Safety Management,
LLC, and also worked for Kraft Heinz Co. and Kellogg
Co. CP
Chief executive officer -
Andrew P. Callahan
Hostess Brands, Inc. net income
Hostess Brands, Inc. net revenue
Hostess Brands, Inc. share price
per share
$19
$108
$119
$908
$1,017
$1,142
$15
$17
$19
$21
$23
$25
2019
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84 \ November 2022
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