UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
Date of report (Date of earliest event reported): November 14, 2024
(Exact name of registrant as specified in its charter)
| (State or Other Jurisdiction of Incorporation) | (Commission File Number) | (IRS Employer Identification No.) | ||||||||||||
| (Address of Principal Executive Offices) | (Zip Code) | |||||||
(Registrant’s Telephone Number, Including Area Code)
Not Applicable
(Former Name or Former Address, if Changed Since Last Report)
| Title of each class: | Trading Symbol(s) | Name of each exchange on which registered: | ||||||||||||
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
| Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |||||
| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |||||
| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |||||
| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) | |||||
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company o
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o
Item 7.01 Regulation FD Disclosure.
Ingredion Incorporated (the “Company”) is hereby furnishing as an exhibit to this report a copy of a presentation to be given by certain senior executives of the Company as part of its previously announced 2024 Texture Innovation Day to be held on November 14, 2024.
The presentation referred to above contain or may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Actual results and developments may differ materially from the expectations expressed in or implied by such forward-looking statements because of risk and uncertainties, including the risks and uncertainties described in the Company’s annual report on Form 10-K for the year ended December 31, 2023 and in its subsequent reports on Form 10-Q and Form 8-K.
The information contained in Item 7.01 of this current report on Form 8-K, including Exhibit 99, is being “furnished” to the Securities and Exchange Commission, shall not be deemed “filed” for purposes of Section 18 of the Exchange Act or otherwise subject to the liabilities under that Section and shall not be deemed incorporated by reference into any filing of the Company under the Securities Act or the Exchange Act, unless specifically identified as being incorporated therein by reference.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
The following documents are herewith furnished or filed as exhibits to this report:
| Exhibit Number | Description | |||||||
| 99 | ||||||||
| 104 | Cover Page Interactive Data File (the cover page XBRL tags are embedded in the Inline XBRL document). | |||||||
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| INGREDION INCORPORATED | |||||||||||
| Date: | November 14, 2024 | By: | /s/ Tanya M. Jaeger de Foras | ||||||||
| Tanya M. Jaeger de Foras | |||||||||||
| Senior Vice President, Chief Legal Officer, Corporate | |||||||||||
| Secretary and Chief Compliance Officer | |||||||||||
Texture Innovation Day November 14, 2024 Exhibit 99 2 Forward-Looking Statements This presentation contains or may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Ingredion intends these forward-looking statements to be covered by the safe harbor provisions for such statements. Forward-looking statements include, among others, any statements regarding our expectations for full-year 2024 Texture & Healthful Solutions net sales, operating income, operating income margin and EBITDA margin, 2028 Texture & Healthful Solutions net sales, operating income, operating income margin and EBITDA margin, market growth rates for various ingredients or products, and any other statements regarding our prospects and our future operations, financial condition, volumes, cash flows, expenses or other financial items, including management’s plans or strategies and objectives for any of the foregoing and any assumptions, expectations, or beliefs underlying any of the foregoing. These statements can sometimes be identified by the use of forward-looking words such as “may,” “will,” “should,” “anticipate,” “assume,” “believe,” “plan,” “project,” “estimate,” “expect,” “intend,” “continue,” “pro forma,” “forecast,” “outlook,” “propels,” “opportunities,” “potential,” “provisional,” or other similar expressions or the negative thereof. All statements other than statements of historical facts therein are “forward-looking statements.” These statements are based on current circumstances or expectations, but are subject to certain inherent risks and uncertainties, many of which are difficult to predict and beyond our control. Although we believe our expectations reflected in these forward-looking statements are based on reasonable assumptions, investors are cautioned that no assurance can be given that our expectations will prove correct. Actual results and developments may differ materially from the expectations expressed in or implied by these statements, base d on various risks and uncertainties, including geopolitical conflicts and actions arising from them, including the impacts on the availability and prices of raw materials and energy supplies, supply chain interruptions, and volatility in foreign exchange and interest rates; changing consumer consumption preferences that may lessen demand for products we make; the effects of global economic conditions and the general political, economic, business, and market conditions that affect customers and consumers in the various geographic regions and countries in which we buy our raw materials or manufacture or sell our products, and the impact these factors may have on our sales volumes, the pricing of our products and our ability to collect our receivables from customers; future purchases of our products by major industries which we serve and from which we derive a significant portion of our sales, including, without limitation, the food, animal nutrition, beverage and brewing industries; the risks associated with pandemics; the uncertainty of acceptance of products developed through genetic modification and biotechnology; our ability to develop or acquire new products and services at rates or of qualities sufficient to gain market acceptance; increased competitive and/or customer pressure in the corn-refining industry and related industries, including with respect to the markets and prices for our primary products and our co-products, particularly corn oil; price fluctuations, supply chain disruptions, and shortages affecting inputs to our production processes and delivery channels, including raw materials, energy costs and availability and cost of freight and logistics; our ability to contain costs, achie ve budgets and realize expected synergies, including with respect to our ability to complete planned maintenance and investment projects on time and on budget as well as with respect to freight and shipping costs and hedging activities; operating difficulties at our manufacturing facilities and liabilities relating to product safety and quality; the effects of climate change and legal, regulatory, and market measures to address climate change; our ability to successfully identify and complete acquisitions, divestitures, or strategic alliances on favorable terms as well as our ability to successfully conduct due diligence, integrate acquired businesses or implement and maintain strategic alliances and achieve anticipated synergies with respect to all of the foregoing; economic, political and other risks inherent in conducting operations in foreign countries and in foreign currencies; the failure to maintain satisfactory labor relations; our ability to attract, develop, motivate, and maintain good relationships with our workforce; the impact on our business of natural disasters, war, threats or acts of terrorism, or the occurrence of other significant events beyond our control; the impact of impairment charges on our goodwill or long-lived assets; changes in government policy, law, or regulation and costs of legal compliance, including compliance with environmental regulation; changes in our tax rates or exposure to additional income tax liability; increases in our borrowing costs that could result from increased interest rates; our ability to raise funds at reasonable rates and other factors affecting our access to sufficient funds for future growth and expansion; interruptions, security incidents, or failures with respect to information technology systems, processes, and sites; volatility in the stock market and other factors that could adversely affect our stock price; risks affecting the continuation of our dividend policy; and our ability to maintain effective internal control over financial reporting. Our forward-looking statements speak only as of the date on which they are made, and we do not undertake any obligation to update any forward-looking statement to reflect events or circumstances after the date of the statement as a result of new information or future events or developments. If we do update or correct one or more of thes e statements, investors and others should not conclude that we will make additional updates or corrections. For a further description of these and other risks, see “Risk Factors” and other information included in our Annual Report on Form 10-K for the year ended December 31, 2023, and our subsequent reports on Form 10-Q and Form 8-K filed with the Securities and Exchange Commission. Today’s agenda Innovation process behind texture and how it drives profitable growth • James P. Zallie, President and CEO • Valdirene Evans, Senior Vice President and President, Global Texture Solutions • Michael O’Riordan, Senior Vice President, Texture & Healthful Solutions, EMEA and Asia-Pacific • Michael Leonard, Senior Vice President, Chief Innovation Officer and Head of Protein Fortification • Jim Gray, Executive Vice President and Chief Financial Officer 9:00 a.m. End of program Q&A Tours and tastings – Food pilot plant/Culinology kitchen/Pilot innovation center Texture and tasting experience lunch 11:15 a.m. 12:30 p.m. 1:30 p.m. 3 Break Texture Solutions Jim Zallie President and CEO Ingredion Texture Innovation Day November 14, 2024 4
Unlike flavor, texture has no standardized descriptors 5 CHINESE LANGUAGE: 140+ Terms for food texture JAPANESE LANGUAGE: 400+ Terms for food texture Texture impacts: • Appearance • Mouthfeel • Flavor release • Taste • Auditory experience • Overall liking Source: Journal of Texture Studies Yet, all of us have our personal texture preferences … 6Source: Ingredion internal and third-party research And if the texture isn’t working, then consumers won’t come back for more 7 >50% of consumers would reject a food product if they don’t like the texture1 Source: 1) Ingredion propriety global study on consumer attitudes towards food, 11 countries, about 1,000 participants each or 11,602 total, September 2024 Texture… can affect how full we feel after eating can influence our memories of eating experiences can influence perception of food’s temperature preferences vary significantly across cultures can influence how quickly we eat can influence how we perceive food’s nutritional value can be impacted by the microscopic structure of food and flavor can be influenced by our perception of the sound of food can greatly influence acceptance can determine overall satisfaction of food Healthful Texture plays an undervalued but vital role impacting taste and consumers’ overall liking 8 7 out of 10 consumers agreed that texture gave food and beverages a more interesting experience1 84% of consumers associated light texture with healthier options2 Source: 1) Innova Market Insights 2019; 2) Ingredion propriety global study on consumer attitudes towards food, 11 countries, about 1,000 participants each or 11,602 total, September 2024,. TASTE AND O V ER A L L L IK IN G Sweet spot for “Solutions” Flavor Texture
9 Texture & Healthful Solutions consists of three distinct end markets Pharma Beauty and Home Care Food and Beverage ~90% $2.4 - 2.5B Estimated FY 2024 Net Sales* 13% - 15% Estimated FY 2024 Operating Income Margin* * Guidance issued on November 5, 2024 Remaining food categories Other Batter & Breading Bakery Dairy & Alt. Dairy Savory & Flavors ~10% The global texture market is expansive, offering significant potential for growth and margin enhancement 10 Packaged Food Retail $600B Global front-of-pack texturizer opportunities INGR 2024 T&HS Net Sales $2.4 – 2.5B* Global Texturizing Ingredients and Solutions $20B 10% of products launched in 2023 had front-of- package texture claims1 Source: Internally compiled detail across various sources including: Markets and Markets, Technavio, Market Data Research, Statista,Ingredion internal intelligence, 1) Innova * Guidance issued on November 5, 2024 To accelerate growth, we have identified 3 priority consumer benefit areas within our Texture & Healthful Solutions segment to target 11 The “texture experience“ Affordability Clean label/Natural/Authentic 1 2 3 Winning Aspiration: WE STRIVE TO MAKE FOODS HEALTHIER AND HEALTHFUL WE STRIVE TO MAKE HEALTHY, HEALTHIER AND HEALTHFUL FOODS TASTE BETTER THROUGH TEXTURE’S IMPACT ON OVERALL LIKING • PROBLEM SOLVER • SOLUTIONS PROVIDER • CO-CREATOR AND INNOVATION PARTNER • UNIQUELY RECOGNIZED • RESPECTED, CREDIBLE • IDEA GENERATOR AND CONCEPT DEVELOPER • OPPORTUNITY SPOTTER 12 Be recognized as the go-to provider for texture and healthful solutions that make healthy taste better
The Texture Opportunity Valdirene Evans Senior Vice President and President, Global Texture Solutions Ingredion Texture Innovation Day November 14, 2024 I r i t r I ti r , 13 Texture market is large and growing Affordability and clean label trends represent a large opportunity 14 INGR 2024 Net Sales* $2.4 - $2.5B Global Ingredients/ Solutions $20B Packaged Food Retail $600B Global Claim Enabling ~$1B Global Consumption $150B Global Ingredients $7-10B Global Consumption $130B Texture Market Clean Label* (incl. in texture experience) Affordability* (incl. in texture experience) Source: Euromonitor, Innova, internal INGR estimates Starches Hydrocolloids Fibers 2-5% Volume CAGR * Guidance issued on November 5, 2024 Majority of consumers prefer products that are affordable or clean label Note: Ingredion study, The percentages represent Top-2 Box values. Top-2 Box values represent on a scale from 1 = I do not agree at all to 5 = I totally agree, respondents that chose the value 5 or 4. Please indicate how much you agree that the following statements apply to your personal habits? Pay attention to the price of food and beverage products 80% Regularly check the ingredient list 60% Think the claim “all natural” is very appealing 75% Prefer products with natural ingredients 72% 15 16 What drives demand in the texture market? 16
Demand for texture ingredients driven by economic growth and urbanization 17 Country RTE meals1 (kg) GDP per capita2 Total population2 Germany 20 kg $52,746 84 million United States 16 kg $81,695 335 million Thailand 13 kg $7,172 72 million Brazil 6 kg $10,043 216 million Source: 1) Statistica - The Ready-to-Eat (RTE) Meals market covers products that require minimal preparation by the consumer, i.e., meals that only require heating up; Average volume per person in ready to eat meals market 2024 2) Worldbank data 1 Developing markets Higher percentage of daily home-cooked meals, due to affordability of basic ingredients and available time, lower GDP per capita 2 Developed markets High demand for diverse textures, high GDP per capita, lower percentage of daily home-cooked meals – huge demand for convenience Significant potential exists for innovative texture ingredients that deliver superior performance 18 World US 2023 kg per capita Source: Internal Estimates, World Population Review, Statista, Census, United Nations Modified starch consumption per capita comparably low in emerging markets, representing a strong growth opportunity Modified starch consumption per capita Population (2023) 8.0B 0.3B Projected pop. growth (2023-2030) +500M +15M Significant headroom for growth 6x times larger Growing trends shaping texture opportunities Multi-cultural foods 60% of consumers prefer multi-texture and multi-flavor foods Source: 1) https://www.manchesterprofessionals.co.uk/article/business-management/64477/urbanization-and-busy-lifestyles-propel-convenience-food-market-to-72-cagr 2) https://www.statista.com/outlook/emo/online-food-delivery/worldwide 3) Ingredion propriety global study on consumer attitudes towards food, 11 countries, about 1,000 participants each or 11,602 total, September 2024 Convenience Urbanization and lifestyle trends driving Delivery 2 billion delivery consumers in 2024 GrubHub, Deliveroo accelerating technology deliveries 19 20 How does Ingredion meet the global texture opportunity? 20
The texture opportunity is global, success is enabled by our knowledge of local tastes and preferences 8 Idea labs 4 Idea labs 6 Idea labs 12 Idea labs 21 22 plants globally Product requirements Formulation Manufacturing Packaging, shipping and storage Consumption Complex product/label requirements Variability in raw ingredients Ensuring batch to batch consistency Maintaining shelf-life stability in ambient or cold temperatures Delivering high quality eating experience and texture profile Product formulation expertise & expansive portfolio Unique grains and raw materials Functional & customized solutions to simplify manufacturing Maintaining textural stability Improved eating experience with novel textures Our customers’ value chain presents challenges and opportunities 22IN G R S o lu ti o n s C h a ll e n g e s Multiple points of quality loss or product failure Value creation at every step in the journey Engage customers Explore how texture makes healthy taste better Assess the current state Define the problem/opportunity Rapidly generate digital concepts and solutions Model and test prototypes Implement and scale Purchase solutions The journey of innovation to enable customer success 23 Precise, data-driven prioritization Our texture business is focused on 5 categories, each representing high growth sub-categories Savory Dairy Bakery Snacks Beverage Focus sub- categories • Sauces & dressings (wet & dry applications) • Meat, fish & poultry • Ready meals ( wet & dry applications) • Batters & breadings • Noodles • Yogurt & yogurt alt. • Processed cheese & cheese alt. • Creamers and milk alt. • Cake, donut, pastry incl. fillings & toppings • Bread, bread mixes, tortillas • Biscuit, cookies and crackers • Sports & energy drinks (Ready to drink & ready to mix applications) Texturizer Market Size 2024 $~5B $~1B $~8B $~2B $~1B Texturizer Market Growth (%CAGR) 2-3% 3-4% 3-4% 1-2% 6-7% Source: Euromonitor, internal INGR analysis Assumptions: Global TS Only Global sales from these categories represents >90% of the texture solutions opportunity 24
The opportunity to elevate texture is now . . . 25 • Leading global position in texture • Adding new capabilities and unique insights in texture • Identify and create consumer-preferred textures • Improve customer success rates for new product launches • Capture value extending beyond a product-led model . . . . and let us share some examples Customers . . . and Solutions Michael O’Riordan Senior Vice President, Texture & Healthful Solutions, EMEA and Asia-Pacific Ingredion Texture Innovation Day November 14, 2024 26 >80% Approximately of product launches fail Ensuring product success through superior texture and taste 27 This requires significant knowledge and know-how Source: HBR Texture is the critical element for a favorable eating experience and driving consumers repeat purchase 28 Texture accounts for 40% of the overall consumer liking1 Texture can make or break a consumer’s eating experience. Will they purchase again or try something else? 0.0 2.0 4.0 6.0 8.0 10.0 12.0 14.0 16.0 Firmness Slipperiness Chalkiness Mouth drying Overall mouthcoating Chalky mouthcoating Visual viscosity Color intensity Viscosity Uniformity of compression Overall mouthfeel Overall mouthfeel (1 min) Balance and blend Flavor lag Body/fullness Total impact Total impact Astringent Bitter Sour Source: proprietary consumer product evaluations
Texture is more critical for certain categories of food 29 Dairy yogurt +70% of respondents think texture is “Very Important” Savory bakery Ice cream Noodles/pasta Sweet bakery Note: Ingredion study, The percentages represent Top-2 Box values. Top-2 Box values represent on a scale from 1 = I do not agree at all to 5 = I totally agree, respondents that chose the value 5 or 4. Please indicate how much you agree that the following statements apply to your personal habits? Sources: 1. Ingredion Proprietary Research, Batter & Breading, 2021; 2. Ingredion Proprietary Research, QSR 2023 (Product specific problems) Source: Innova Market Insights 2024 | Fortune Business Insights 2024* Eyes on the fries 30 $17B* Market 15% CAGR Fry-specific challenges: • Multiple thermo-cycles greatly impact product texture and quality along with combinations of moisture, heat and oil lead to extremely short hold times Extending hold times unlocks massive value for QSR and delivery customers 30 Flying high with tortillas 31 $45B* Market Flat CAGR Multi-form function and label attributes are key drivers of market growth Tortilla-specific challenges: • Thermo processes across formulating, baking, freezing, and microwaving creates multiple points of failure • Need for better stretchability and texture Source: Innova Market Insights 2024 | Market Research Future 2024* Market growth dependent upon key attributes: • Lower carb • Gluten & grain free • Higher protein 31 Much ado about mochi 32 $283B* Market 18% CAGR 2019 2020 2021 2022 2023 APAC EMEA NA New product launches for mochi by region 2019-2023 Source: Innova Market Insights 2024 | Verified Market Research 2024* Innovative textural experiences for generational consumers Mochi-specific challenges: • Bringing new innovations in mochi texture, extending shelf-life and avoiding collapsing post- bake while maintaining desired chewy texture 32
Our approach to texture has broadened over time and our solutions capabilities have become more holistic 33 Opportunities for reformulations Changing pizza innovation needs Growth in gluten-free Thin-crust pizza – lower calories Plant-based – vegetarian solutions High-quality home delivery via extended shelf life Dairy Milk/dairy solids replacement Savory/Meals Egg, oil & tomato solids replacement Bakery Egg, fat, gluten replacement Cheese • Value-added Ingredients • Plant-based cheese • Clean label anti-cake for improved melt • Systems-based approach/reduce labor costs Toppings • Value-added ingredients • Plant-based meat alternative pizza toppings Crust • Value-added ingredients • Texture: Chewy – Crispy • Gluten-free • Protein enhancement with pulse flours Sauce • Value for money through tomato solids replacement • 35% reduction for 10-15% recipe cost savings Elevating texture solutions with a holistic services approach and cutting-edge scientific capabilities 34 34 Understanding and delivering the unique texture, taste and label attributes that drive a product’s success Sensory/consumer liking Texture science/ applications Consumer ingredient preference Predictive formulation à la carte services Play T- Rex video The Science: Technology Platforms Supporting Sensory and Formulation Michael Leonard Senior Vice President, Chief Innovation Officer and Head of Protein Fortification Ingredion Texture Innovation Day November 14, 2024 36
Consumers are globally diverse and our customer’s needs arise from all parts of the world 37 8 Idea labs 4 Idea labs 6 Idea labs 12 Idea labs Global Center 22 plants globally Unmet customer needs shape our innovation agenda Functional Capabilities Plant science Process technology Ingredient informatics Ingredient science Biotransformation Texture science Scientific and regulatory affairs CulinologySensory Open innovation & venturing Analytical and measurement science Intellectual property management Consumer, industry and customer insights 38 Technology Platforms and Process Technology Supporting the structure and texture behind consumers’ great eating experiences Offering healthful solutions to help satisfy a changing world without compromising consumer expectations We offer the broadest and deepest portfolio of specialty starches, which are foundational to texturizing 39 TEXTURE SOLUTIONS CUSTOMIZED SOLUTIONS TEXTURE FOR HEALTHFUL SOLUTIONS NATURE-BASED RAW MATERIALS C O R N T A P I O C A R I C E P O T A T O P E A O T H E R S STARCHES HYDROCOLLOIDS FIBERS (fiber enrichment, digestive health, metabolic health, protein fortification) SWEETENERS (sugar reduction) Eating is simple, but food is complicated 40 Eating Experience Continuum Perceived Texture Oral process Food structure Food micro- structure Inter/intra molecular function & interaction Molecular structure
41 Getting delicious food to people is also complex Which of the below have you ever experienced when eating at or ordering from fast food/fast casual restaurants? Taste is the most important attribute for consumers buying frozen breaded products.1 Not crispy enough fries and chicken are frequent and bothersome issues for QSR and fast casual consumers.2 Sources: 1. Ingredion Proprietary Research, Batter & Breading, 2021; 2. Ingredion Proprietary Research, QSR 2023 (Product specific problems) 5% 6% 8% 8% 14% 16% 23% 27% 30% 33% Sauce/Dressing was too sticky Not enough plant-based options Not enough sauces to choose from Cheese was too leathery Fried chicken wasn't crispy enough Not enough healthy options Taste isn't consistent Food wasn't fresh Fries weren't crispy enough Food was cold 41 Texture is experienced across multiple senses – our product designs address all of them 0.00 1.00 2.00 3.00 4.00 5.00 Audible Crunch Crispiness Bite Resistance Tooth Packing Standard clear coated control Ingredion optimized solution +44% +75% +22% -20% 42 Achieving just-right texture through batters and coatings starts at the molecular level Amylose-containing starches, like high amylose maize, are commonly used to increase crunchiness, hardness, and strength. Amylopectin-containing starches, like waxy maize, are commonly used to increase expansion and deliver crispiness. Porous, open, lightBrittle, dense set = Crunch 43 Doing this successfully requires deep structure-function understanding that is unique to Ingredion 44 -1,6-glucosidic bond -1,4-glucosidic bond A-chain B1-chain C-chain -1,6-glucosidic bond -1,4-glucosidic bond B2/B3-chain Starch granule Crystalline lamella Amylose and amylopectin molecules can organize in many different ways… ...which result in larger structures that are critical to texture
Our deep understanding of food structure enables us to customize texture experiences 45 Confocal laser scanning micrographs of a French fry coating Potato cells Surface crust Potato cells Oil globules Surface crust We have a range of capabilities to drive texture preference, and plant science is among the most powerful 46 Plant Science Process Technology Biotransformation Our product portfolio and technical capabilities enable great textures that consumers crave 47 Crispier for longer Novel, soft and springy Indulgent creaminess Superior stretch and melt Texture & Healthful Growth: Driving Financial Success Jim Gray Executive Vice President and CFO Ingredion Texture Innovation Day November 14, 2024 48
1 Volume growth Demonstrated trends around health and wellness, affordability and clean label, as well as expanding pharma and beauty portfolio 2 Product mix enhancement Shift towards higher ASP products and customized solutions with unique functionality 3 Pricing centers of excellence Driving optimized pricing for premium high-performing solutions with clear customer benefits Growth drivers 49 Solutions and services Leveraging our formulation expertise and customers’ requirements for speed to market to accelerate innovation 4 Ingredion leading market positions in texture across most markets 50 Ingredion Peer A Peer B Peer D Others Ingredion Peer B Peer A Peer C Others US/CAN Europe Peer A Ingredion Peer E Peer C Others Middle East & Africa Ingredion Peer C Peer A Peer B Others APAC* Source: Ingredion competitive intelligence * For corn-based texture market Texture & Healthful Solutions segment 4 year growth outlook 2024 2028 ~$2.4-$2.5B ~$3B+5 - 6% CAGR Net Sales $300 - $400M Op. Inc. Margin 13% - 15% Long-term Growth Projections 2025 – 2028 16% - 18% 51 EBITDA Margin 15% - 17% 18% - 20% Operating Income $450 - $550M Net Sales 5% - 6% CAGR Gross Profit Margin 27% - 28% 2024 est. Op. Income 8% -10% CAGR Estimated ~2.5% R&D of T&HS Segment sales SG&A 12%-14% of sales Texture & Healthful Solutions requires greater investment in R&D and technical solutions capabilities 52 Organic investment supporting future capacity Growing IP library
Margin growth will come from greater incremental mix of higher value products and solutions 53 Rest of company* Texture & Healthful +3 – 5% Volume Growth *Rest of Company includes all remaining businesses of Ingredion Rest of company* Texture & Healthful ~2x – 2.5x Average Selling Price We will continue to expand our texture portfolio through organic capital investment and strategic M&A $100M China expansion Commissioned in 2022 $40M Food systems Integrated and accretive $160M Starch- based texturizers Invested over 2021-2024 period * Investments made over previous years and ongoing commitments 54 Winning Aspiration: WE STRIVE TO MAKE FOODS HEALTHIER AND HEALTHFUL WE STRIVE TO MAKE HEALTHY, HEALTHIER AND HEALTHFUL FOODS TASTE BETTER THROUGH TEXTURE’S IMPACT ON OVERALL LIKING • PROBLEM SOLVER • SOLUTIONS PROVIDER • CO-CREATOR AND INNOVATION PARTNER • UNIQUELY RECOGNIZED • RESPECTED, CREDIBLE • IDEA GENERATOR AND CONCEPT DEVELOPER • OPPORTUNITY SPOTTER 55 Be recognized as the go-to provider for texture and healthful solutions that make healthy taste better Q&A Our Purpose Bringing the potential of people, nature and technology together to make life better 56
30 digitally connected Idea Labs in all geographies Pilot Plants Culinology Sensory Application Laboratories Local Kitchens / Laboratories Co-Creation • Formulation Expertise in key categories • Sensory / Culinology • Technical Support Bridgewater, NJ, USA Mississauga, ON, Canada Hamburg, Germany Lubeck, Germany Manchester, UK Sydney, Australia Singapore Shanghai, China Tokyo, Japan Bangkok, Thailand Johannesburg, South Africa Manila, Philippines Kuala Lumpur, Malaysia Jakarta, Indonesia Mumbai, India Ho Chi Minh, Viet NamMexico City Mogi Guacu, Brazil Dubai, UAE Englewood, CO White Marsh, MD Bedford Park, IL- USA Cali, Colombia Nairobi - Kenya Cornwala - Pakistan Queretaro Global Center Kerr 57 Hazel Fromm-Tatosian Senior Director Global Applications Bridgewater Idea Labs Tour Leads A B C Tarak Shah Senior Manager Texture Solutions – Non-Food Didem Icoz Director Applications – Texture & Healthful Solutions Juliana Bernalostos-Boy Senior Director Project Portfolio Management Eric Weisser Senior Director Open & Customer Innovation Elena De La Pena Senior Program Manager Innovation 58