ICR Conference
The ICR Conference is one of the largest consumer investment conferences of the year. Numerous companies in Restaurants and Consumer Staples are scheduled to present at the ICR Conference on January 9 and 10. We have published a Primer to provide a reference guide for many of the presenting companies in our Restaurants and Consumer Staples sectors. The Primer provides an investment summary for our focus companies presenting at the conference. Each company section provides an investment overview, brief company synopsis, and questions/discussion points for the management teams. Make sure to bring our Primer with you to the conference.
Webcast Replay: CLICK HEREConference Primer Download: CLICK HERE |
Canadian Beer (TAP)
Total beer volumes in Canada decreased by 5% in November, decelerating slightly from -4.8% in October. Domestic beer volumes decreased by 4.3% in November, decelerating from -3.5% in October. Imported beer volumes decreased by 9.8% in November, improving from -13.5% in October. YTD beer volumes are down 3.6% in Canada despite the easier on-premise comparisons. One of the challenges to the on-premise industry is a labor shortage which is limiting hours of operation. For Molson Coors, the Canadian on-premise channel is still trailing pre-pandemic levels.
Most trusted grocer (WMT)
Market research firm BrandSpark International in partnership with Winsight Grocery Business and Newsweek surveyed more than 10,000 shoppers about their most trusted food retailers. Walmart was voted as the most trusted conventional grocer and the most trusted online grocer. Aldi was voted the most trusted discount and small-format grocer. Whole Foods was voted the most trusted natural and organic grocer. 7-Eleven was voted the most trusted c-store chain. CVS was voted the most trusted chain pharmacy. Grocery Outlet was voted the most trusted discount grocer in the West. Kroger was voted the most trusted conventional grocer in the Midwest. Everyday low price earns the trust from customers and customers want low prices in the current environment.
Kenvue registration statement (KVUE, PRGO)
Johnson & Johnson’s consumer health business, Kenvue, filed its S-1 last night. The business had revenue of $15.1B in 2021, up 4.1% from the prior year. When it lists on the NYSE the ticker will be KVUE. J&J will continue to own at least 80.1% of the voting power of Kenvue. Kenvue has three business segments: Self Care comprising 38% of sales, Skin Health & Beauty comprising 30% of sales, and Essential Health comprising 32% of sales. 57% of the company’s sales are outside North America.
Items of note from the S-1:
- 12% of sales are e-commerce.
- Supply chain shortages have been a headwind to sales in 2022 while the cough and cold medicine was the biggest driver of sales excluding price increases.
- 66% of marketing spend is digital.
- In allergy care where Zyrtec is #2 in market share, private label accounts for 26% of sales globally.
- In pain care where Tylenol is #1 in market share, private label accounts for 19% of sales globally.
- Product innovations launched in the past three years accounted for $1.5B in sales. 105 new products were launched each year since 2020.
- Talc lawsuits will remain with J&J, not with Kenvue following the separation. Kenvue still sells baby powder in certain markets outside the U.S., but it will be discontinued globally. J&J will indemnify Kenvue, but not for suits outside the U.S. where Kenvue still sells the product. Government inquiries would also not be covered by J&J’s indemnification obligations.
The IPO of Kenvue should bring more investor attention to the consumer healthcare sector benefiting Haleon and Perrigo.
