Davide Campari-Milano N.V. · MIL:CPR
Davide Campari-Milano — 9M 2013 Earnings Presentation
44 slides from Davide Campari-Milano's earnings presentation, Nov 14, 2013
Slide 1: 2013 Nine Months Results
2013 Nine Months Results Investor Presentation 14 November 2013 Slide 1 Nine Months ended 30 September 2013
Slide 2: Results highlights
Results highlights Sales review - by region - by brand Consolidated income statement Operating Working Capital and Net debt analysis New developments Conclusion and Outlook Slide 2 Nine Months ended 30 September 2013
Slide 3: Results for Nine Months to September 2013: Key highlights
Results for Nine Months to 30 September 2013 Key highlights 9M 2013 Organic 3Q 2013 Organic € million change € million change Net sales 1,052.5 -0.4% 353.9 +5.2% EBITDA pre one-off’s 229.2 -9.6% 83.6 +10.3% EBIT pre one-off’s 198.6 -11.5% 73.2 +11.3% > 9M 2013 results • benefitted from strong accele
Slide 4: Sales highlights
Results for Nine Months to 30 September 2013 Sales highlights (1) Breakdown of change in perimeter €m Total Lascelles deMercado 145.5 € 931.6 m € -4.0 m € -28.2 m € 153.1 m € 1,052.5 m New agency brands (2) 12.0 -0.4% -3.0% +16.4% Termination of other agency brands (4.4) Total perimeter change 8. 2%
Slide 5: Operating and financial highlights
Results for Nine Months to 30 September 2013 Operating and financial highlights 9M 2013 3Q 2013 1H 2013 Reported Organic Reported Organic Reported Organic € million Forex Perimeter change change change change change change 1,052.5 +13.0% -0.4% -3.0% +16.4% +13.0% +5.2% +13.0% -3.3% Net sales 392.6 +
Slide 6: Results highlights
Results highlights Sales review - by region - by brand Consolidated income statement Operating Working Capital and Net debt analysis New developments Conclusion and Outlook Slide 6 Nine Months ended 30 September 2013
Slide 7: 2013 Nine Months Net Sales Breakdown by region & segment
2013 Nine Months Net Sales Breakdown by region & segment 9M 2013 Net Sales: € 1,052.5 m Breakdown by region Breakdown by segment Americas 42.4% (35.2% in 9M 2012) Spirits Wines Italy 74.7% 12.3% 25.4% (11.9% in 9M 2012) (78.3% in 9M 2012) (30.4% in 9M 2012) Soft Drinks 6.5% (8.6% in 9M 2012) RoW & O
Slide 8: 2013 Nine Months Sales by Region: Americas
2013 Nine Months Sales by Region Americas € 328.2 m +4.3% -6.2% +37.8% € 446.1 m Americas as % of 9M 2013 Group sales Americas sales organic growth by key market in 9M 2013 USA +3.7% Brazil -0.5% Argentina +22.0% +35.9% Americas sales breakdown 9M 2012 Organic Forex Perimeter 9M 2013 by segmen
Slide 9: Americas (cont'd)
2013 Nine Months Sales by Region Americas (cont’d) Analysis by key markets > US (20.9% of Group sales in 9M 2013) • continued positive momentum in the existing business (+3.7%(1) in 9M 2013), driven by: - double digit growth in the Wild Turkey franchise (+15.4%(1)), driven by Wild Turkey bourbon and
Slide 10: 2013 Nine Months Sales by Region: Italy
2013 Nine Months Sales by Region Italy Italy as % of 9M 2013 Group sales Italy sales organic growth by segment in 9M 2013 Spirits -1.0% Wines -9.4% Soft drinks -16.9% Italy sales organic growth by quarter 2013 2012 1H -16.0% +1.1% 3Q +24.5% -9.7% 9M -5.9% +6.0% 4Q - -7.1% FY - -3.3%
Slide 11: Italy (cont'd)
2013 Nine Months Sales by Region Italy (cont’d) Analysis by key brands > Core spirits segment down -1.0%(1) in 9M 2013 (+43.8%(1) in Q3 2013) driven by: • Organic performance led by continued sustained growth of Aperol (+10.2%(1)) and a strong recovery of the other key brands (Campari, Campari Soda
Slide 12: Europe (excl. Italy)
2013 Nine Months Sales by Region Europe (excl. Italy) Europe as % of 9M 2013 Group sales Europe sales organic growth by key market in 9M 2013 Germany -4.9% Russia +30.3% Europe sales breakdown Europe sales organic growth by segment by quarter 2013 2012 1H +0.0% -3.2% 3Q +1.9% +0.8% 9M +0.7
Slide 13: Europe (excl. Italy) (cont'd)
2013 Nine Months Sales by Region Europe (excl. Italy) (cont’d) Analysis by key markets > Germany (10.1% of Group sales) down by -4.9%(1) in 9M 2013 (after three consecutive positive months, -3.4%(1) in Q3 2013 driven by poor September, on the back of weather conditions) as the expected softness of A
Slide 14: RoW and GTR
2013 Nine Months Sales by Region RoW and GTR RoW and GTR as % of 9M 2013 Group sales RoW and GTR sales organic growth by key market in 9M 2013 Australia -6.8% RoW and GTR sales organic RoW and GTR sales breakdown growth by quarter by segment 2013 2012 1H -3.5% +15.0% 3Q -2.7% +10.9% 9M -3.2%
Slide 15: RoW and GTR (cont'd)
2013 Nine Months Sales by Region RoW and GTR (cont’d) Analysis by key markets > Improving trends in Australia (4.6% of Group sales) down by -6.8%(1) in 9M 2013 (-2.3% in Q3 2013) (-8.0% in Q2 2013, -11.4% in Q1 2013) • weak shipments of Wild Turkey franchise, driven by heightened competitive pressur
Slide 16: Results highlights
Results highlights Sales review - by region - by brand Consolidated income statement Operating Working Capital and Net debt analysis New developments Conclusion and Outlook Slide 16 Nine Months ended 30 September 2013
Slide 17: Review of top brands - Spirits
Review of top brands - Spirits Brand sales as % % organic change Spirits of Group’s sales in sales value Sales performance review in 9M 2013 9M 2013 3Q 2013 > Overall improving trend still affected by expected weakness in Germany. Q3 10%(*) -2.5% +13.4% strong recovery driven by Italy and continued
Slide 18: Review of top brands - Spirits (cont'd)
Review of top brands - Spirits (cont’d) Brand sales as % % organic change Spirits of Group’s sales in sales value Sales performance review in 9M 2013 9M 2013 3Q 2013 > Q3 Performance positively impacted by realignment with consumption trends in core Italian market. However, the very challenging envi
Slide 19: Review of top brands - Wines and Soft Drinks
Review of top brands - Wines and Soft Drinks Brand sales as % % organic change Wines of Group’s sales in sales value Sales performance review in 9M 2013 9M 2013 3Q 2013 > Positive performance in Russia, Germany and Argentina offsetting category weakness 3% +3.6% +7.4% in the rest of developed market
Slide 20: Results highlights
Results highlights Sales review - by region - by brand Consolidated income statement Operating Working Capital and Net debt analysis New developments Conclusion and Outlook Slide 20 Nine Months ended 30 September 2013
Slide 21: Consolidated P&L: Gross Profit
Consolidated P&L for Nine Months to 30 September 2013 Gross Profit 9M 2013 9M 2012 9M 2013 a t cons tant peri meter a nd FX % of % of Reported % of Orga ni c Forex Peri meter € mi l l i on € mi l l i on € mi l l i on s a l es s a l es cha nge s a l es growth i mpa ct i mpa ct Net s a l es 1,052.5 10
Slide 22: Consolidated P&L: Contribution after A&P
Consolidated P&L for Nine Months to 30 September 2013 Contribution after A&P 9M 2013 9M 2012 9M 2013 a t cons tant peri meter a nd FX % of % of Reported % of Orga ni c Forex Peri meter € mi l l i on € mi l l i on € mi l l i on s a l es 9M 2013 s a l es 9M 2012 cha nge 9M 2013 a t cons tant peri mete
Slide 23: Consolidated P&L: EBIT and EBITDA
Consolidated P&L for Nine Months to 30 September 2013 EBIT and EBITDA 9M 2013 9M 2012 9M 2013 a t cons tant peri meter a nd FX % of % of Reported % of Orga ni c Forex Peri meter € mi l l i on € mi l l i on € mi l l i on s a l es s a l es cha nge s a l es growth i mpa ct i mpa ct Net s a l es after A
Slide 24: FX impact analysis
FX impact analysis 1H 2013 3Q 2013 9M 2013 (at reported FX) (at reported FX) (at reported FX) € million % change € million % change € million % change Sales (11.2) -1.8% (16.9) -5.4% (28.2) -3.0% EBITDA pre-one off's (1.3) -0.8% (4.5) -5.9% (5.8) -2.4% 9M 2013 Pro-forma (1) 9M 2013 Negative FX impac
Slide 25: Consolidated P&L: Group pre-tax profit
Consolidated P&L for Nine Months to 30 September 2013 Group pre-tax profit 9M 2013 % of 9M 2012 % of Reported € mi l l i on s a l es € mi l l i on s a l es cha nge Operating profit = EBIT 193.9 18.4% 211.6 22.7% -8.4% Net fi na nci ng cos ts (43.9) -4.2% (33.2) -3.6% +32.2% One-off fi na nci a l cos
Slide 26: Results highlights
Results highlights Sales review - by region - by brand Consolidated income statement Operating Working Capital and Net debt analysis New developments Conclusion and Outlook Slide 26 Nine Months ended 30 September 2013
Slide 27: Operating Working Capital Sept 2013 vs. Dec 2012
Operating Working Capital 30 Sept 2013 vs. 31 Dec 2012 € million 30 September % of LTM 31 December % of LTM change of which 30 September % of LTM change (1) (3) sales 2013 sales 2012 (2) sales 2012 organic FX perimeter change effects Receivables 274.7 18.8% 311.1 23.2% (36.4) (24.6) (14.4) 2.7 259.3
Slide 28: Operating Working Capital Sept 2013 vs. Sept 2012
Operating Working Capital 30 Sept 2013 vs. 30 Sept 2012 € million 30 September % of LTM 30 September % of LTM change 2013 sales (1) 2012 sales Receivables 274.7 18.8% 259.3 19.7% 15.5 Inventories 489.2 33.5% 413.6 31.4% 75.6 Payables (202.5) -13.9% (189.5) -14.4% (12.9) Operating Working Capital 561
Slide 29: Net financial debt
Net financial debt € million 30 September 2013 31 December 2012 Short-term cash/(debt) 251.6 336.5 Medium to long-term cash/(debt) (1,156.8) (1,196.1) Liabilities for put option and earn-out payments (1) (5.5) (10.0) Net cash/(debt) (910.7) (869.7) (1) Estimated debt for the future acquisition of mi
Slide 30: Net financial debt (cont'd)
Net financial debt (cont’d) Debt maturity profile as of 30 September 2013 Average maturity: 6.3 years € million (*) (*) Short term cash net of first tranche of 2009 USPP for repayment in June 2014 Analysis of gross debt Analysis of gross debt by class and issue date by currency and interest rates Bo
Slide 31: Results highlights
Results highlights Sales review - by region - by brand Consolidated income statement Operating Working Capital and Net debt analysis New developments Conclusion and Outlook Slide 31 Nine Months ended 30 September 2013
Slide 32: Bulldog Gin
Bulldog Gin Distribution rights and call option > Campari gained the distribution rights for Bulldog Gin, an independently owned brand with a leading position in the super premium gin segment, today available in over 25 countries, particularly in Europe and selectively in the US > Starting in 2014 C
Slide 33: Bulldog Gin (cont'd)
Bulldog Gin (cont’d) Overview of Bulldog Gin > Bulldog Gin, distilled in England, is recognised as a very smooth and mixable gin. Launched in the Northeast USA in 2007 and in Europe in late 2008, it is based on a distinctive blend of 12 botanicals from eight countries > Since its launch, Bulldog Gin
Slide 34: New route-to-market
New route-to-market Set up of distribution company in Spain > True to its overall strategy to establish and strengthen local in-market presence in key markets where it has reached critical mass, Campari will set up a full in-market distribution company in Spain > Newly established company will be re
Slide 35: Key marketing initiatives - Brown Spirits & Liqueurs
Key marketing initiatives - Brown Spirits & Liqueurs WILD TURKEY CABO WABO X-RATED INNOVATION COMMUNICATION INNOVATION INNOVATION Wild Turkey Spiced Wild Turkey Forgiven Wild Turkey Rare RTD #Nevertamed : Wild Turkey largest Cabo Diablo liqueur, a X-Rated introduces launched in US and launched in US
Slide 36: Results highlights
Results highlights Sales review - by region - by brand Consolidated income statement Operating Working Capital and Net debt analysis New developments Conclusion and Outlook Slide 36 Nine Months ended 30 September 2013
Slide 37: Conclusion
Conclusion > Performance gap of first two quarters of 2013 significantly reduced in 9M 2013 thanks to a strong acceleration in the organic performance in Q3 2013 mainly driven by the recovery in Italy, as expected • Key markets ‒ growth in USA, Russia and Argentina, offsetting softness in Germany, A
Slide 38: Outlook
Outlook > Looking forward, with a worsening forex outlook, continued macroeconomic challenges in key markets and volatile sales mix evolution, the overall business context remains tough > Having successfully completed the announced restructurings, plant start ups and the integration of significant n
Slide 39: Supplementary schedules
Supplementary schedules Schedule - 1 Analysis of 9M 2013 net sales growth by segment and region Schedule - 2 9M 2013 consolidated income statement Schedule - 3 3Q 2013 consolidated income statement Schedule - 4 Average exchange rates in 9M 2013 Slide 39 Nine Months ended 30 September 2013
Slide 40: Net sales analysis by segment and region
Supplementary schedule - 1 Net sales analysis by segment and region Consolidated net sales by region 9M 2013 9M 2012 Change of which: €m % €m % % organic forex perimeter Americas (1) 446.1 42.4% 328.2 35.2% 35.9% 4.3% -6.2% 37.8% Italy 267.0 25.4% 282.8 30.4% -5.6% -5.9% 0.0% 0.3% Europe (excluding
Slide 41: 9M 2013 Consolidated income statement
Supplementary schedule - 2 9M 2013 Consolidated income statement 9M 2013 9M 2012 Change € m % € m % % (1) 1,052.5 100.0% 931.6 100.0% +13.0% Net sales (2) (485.2) -46.1% (384.7) -41.3% +26.1% COGS Gross profit 567.3 53.9% 546.8 58.7% +3.7% Advertis i ng a nd promotion (174.6) -16.6% (165.9) -17.8% +
Slide 42: 3Q 2013 Consolidated income statement
Supplementary schedule - 3 3Q 2013 Consolidated income statement 3Q 2013 3Q 2012 Change € m % € m % % Net sales (1) 353.9 100.0% 313.3 100.0% +13.0% COGS (2) (160.0) -45.2% (129.7) -41.4% +23.4% Gross profit 193.9 54.8% 183.6 58.6% +5.6% Adverti s i ng a nd promoti on (59.2) -16.7% (62.5) -20.0% -5.
Slide 43: Exchange rates effects
Supplementary schedule - 4 Exchange rates effects 1 January - 30 1 January - 30 % change 9M 2013 vs Average exchange rate September September 9M 2012 2013 2012 US dollar : 1 Euro 1.317 1.282 -2.8% Brazilian Real : 1 Euro 2.790 2.456 -13.6% Australian Dollar : 1 Euro 1.347 1.239 -8.7% Russian Ruble :
Slide 44: WWW.CAMPARIGROUP.COM
For additional information: Investor Relations - Gruppo Campari Phone: +39 02 6225 330; Fax: +39 02 6225 479 Website: http://www.camparigroup.com/en/investors E-mail: [email protected] WWW.CAMPARIGROUP.COM Slide 44 Nine Months ended 30 September 2013
Davide Campari-Milano — 9M 2013 Earnings Presentation on 6ix