Utz to debut on the NYSE under ticker 'UTZ'

Snack food brand Utz is going public Monday after it combined with special purpose acquisition company Collier Creek Holdings. Dylan Lissette, Utz CEO, joins Yahoo Finance's The First Trade with Brian Sozzi and Jared Blikre to discuss that, the demand for its products amid the coronavirus pandemic and much more.

Video Transcript

BRIAN SOZZI: It's a big day for chip and cheese ball maker Utz. The nearly 100-year-old snack food giant will debut in the New York Stock Exchange today under the ticker symbol UTZ. Joining us from the New York Stock Exchange is Utz CEO Dylan Lissette. Dylan, good to-- good to speak with you this morning.

Explain to us the rationale behind going through this back route. Certainly SPACs are very hot in this market. How did you come to that decision?

DYLAN LISSETTE: Yeah, a great question. SPACs really became popular in the last couple of months, it seems. But we started thinking about going public through a SAC well over a year ago. Ultimately, at the end of the day, we were able to connect with the Collier Creek guys, who have an esteemed board of managers with Roger Deromedi, Jason Giordano, Chinh Chu, Craig Steeneck, and folks that-- with Collier that we just really liked their playbook. We really liked connecting with them. We had similar strategies.

And it seemed like that was a great way to go public. And so we did it. But it was a little bit before it kind of became cool. So we're happy to be in the middle of it right now and happy to be here on the exchange today. It's an exciting day for the entire company.

BRIAN SOZZI: I'm sure it is. I read the prospectus, and I see two opportunities for your company. One, only 5% of your business is really tied to tortillas. And then you also-- and popcorn. And you also only do 10% of your business with Walmart. How do you plan to grow those areas from here?

DYLAN LISSETTE: Yeah, those are great opportunities for white space, for growth for the company as we go forward. We've literally been-- I've been at Utz since 1995. We've grown for the 24 and 1/2 years that I've been there. We've grown for 99 years, really. Those are just opportunities for us to go after.

So if you think about the subcategories, like you mentioned, tortillas and popcorn, both of them are just places where we don't have as big of a share. We can grow that organically through some of our own brand generation and ideation and innovation. But we also could go down the M&A path to look at ways that we can expand via M&A.

You mentioned Walmart as an example. That's just one of a number of customers that we can go after to expand our sales, where we're under indexed, relative to everybody else. So I just look at it as upside opportunity for us to continue to work with those great chains and great retailers to expand our brands. And with the portfolio that we have and as diverse as the portfolio is, it makes it very easy, I think, to go after that space and find new opportunities for growth for the company as we go forward.

BRIAN SOZZI: Dylan, as a consumer products company, I'm sure you've been following Walmart's pursuit of TikTok, which they have confirmed to Yahoo Finance. Are you excited about that? How would that change what you do?

Essentially, the thinking on the Street is that Walmart's creating a digital marketplace. Or you're getting right in front of consumers. Would you be interested in marketing your products on a TikTok?

DYLAN LISSETTE: Yeah, I mean, I just started reading a little bit about that recently. It's a very interesting surprise when that came out I believe late last week as a potential bidder for TikTok. And so hey, social and digital is where everything is going. It's where we're going to be investing a lot of our monies and advertising as we go forward as Utz Brands Incorporated, because we just think that the world has changed somewhat, and that people are just totally using e-commerce a lot more.

And so originally, we thought we were going to aim for 3%, 4% of our sales in digital e-commerce. And now I think it's going to be upwards of 6%, 7%, 8%, and eventually 10%. So anything that brings consumer brands to the marketplace, and as large of a brand portfolio as we have, we just really think that anything that we can do to increase the visibility of these brands is fantastic. So tough for me to comment on you know Walmart and TikTok per se. But I definitely love the social media and the way that we can promote our brands on that larger stage, whichever way it may happen.

JARED BLIKRE: Jared Blikre here. Just wanted to ask you how COVID has affected your business, and if it gives-- your business gives any insights in to any macro trends that you've noticed with respect to your customers or supply chains. Any insights there?

DYLAN LISSETTE: Yeah, sure. COVID has definitely afflicted it. When it kind of kicked off in mid-March, almost immediately, we saw a surge. We call it work at home, eat at home, school at home. And if you think about those three aspects of it, I don't know if that's going to change anytime in the near future.

And we have a really diverse platform that is able to kind of go to market. We're able to ramp up production easily. We're able to distribute products directly into stores very easily. And we are able to take advantage of that.

So the grocery channel, the grocery food channel, the mass channel, the club channel-- all of those channels saw really increased volumes. The only ones that we really saw that got negatively impacted is a lot of the food service was somewhat negatively impacted. And we, as Utz Brands, don't have a lot of exposure to that.

So as we look forward into the future-- if it's going to school, and then some schools are going to go to virtual and flip-flop back and forth, we just look at it as an opportunity because of the platform we have and the ability to serve our customers. So we've actually benefited, ultimately, at the end of the day, with increased sales and increased volumes.

BRIAN SOZZI: Dylan, Warren Buffett showed interest in Utz going back to 2015. Walk us through, why-- why didn't you pull the trigger on that deal? And would you be open to hearing from him now?

DYLAN LISSETTE: Well, that's a great story, that unfortunately, the headline story got all the press. But the retractment from Pattie Sellers, who was the writer, there was a slight retraction to that statement. It was a misquote. So ultimately, if you do look into that, it was not a true story per se.

So look, the funny thing is in the meantime, I've been sending samples and snacks to Mr. Buffett's office for now years and have developed a nice relationship with his assistant. And so he loves to get our snacks every once in a while. But there really wasn't much of a true story there.

BRIAN SOZZI: Did he place to call with you before the-- before your IPO?

DYLAN LISSETTE: No, no, he did not, no.

BRIAN SOZZI: All right, let's leave it there. Utz CEO Dylan Lissette, congratulations on your big day. Sure we'll be talking to you soon.

DYLAN LISSETTE: Great. Thanks for having me. Appreciate it.