Anheuser-Busch InBev SA/NV · EURONEXT:ABI
Anheuser-Busch InBev SA/NV — SABMiller — FY2015 Earnings Presentation
53 slides from Anheuser-Busch InBev SA/NV's earnings presentation, May 2015
Slide 1: SABMiller plc Preliminary results Year ended 31 March 2015
SABMiller plc Preliminary results Year ended 31 March 2015 Presented by Alan Clark, Chief Executive Domenic De Lorenzo, Acting Chief Financial Officer
Slide 2: Forward looking statements
Forward looking statements This presentation includes ‘forward-looking statements’ with respect to certain of SABMiller plc’s plans, current goals and expectations relating to its future financial condition, performance and results. These statements contain the words “anticipate”, “believe”, “intend
Slide 3: Clear results from our key strategic choices
Clear results from our key strategic choices Drive superior topline growth through 5% NPR growth¹ 1 strengthening our brand portfolios and 8% NPR growth in premium brands¹˒² expanding the beer category Innovation success across all regions 30 bps EBITA margin growth¹ 2 Liberate and improve resource,
Slide 4: Financial Review
Financial Review Domenic De Lorenzo Acting Chief Financial Officer
Slide 5: Positive momentum in underlying performance
Positive momentum in underlying performance 5.8% 6.0% 4.9% 4.6% 1.5% Volumes Group NPR EBITA Adjusted EPS Organic, constant currency* Constant currency © SABMiller 2015 5 *for Adjusted EPS, constant currency excluding the impact of the Tsogo Sun disposal only
Slide 6: Reported currency impacted by FX across a number of markets
Reported currency impacted by FX across a number of markets 7.6% 5.8% 6.0% 4.6% 4.9% 1.9% 1.5% Volumes Group NPR EBITA Adjusted EPS Dividends (1.4)% (1.2)% (1.6)% Reported Organic, constant currency* Constant currency © SABMiller 2015 6 *for Adjusted EPS, constant currency excluding the impact of th
Slide 7: Group NPR growth of 5% driven by Africa and Latin America
Group NPR growth of 5%* driven by Africa and Latin America Organic, constant currency growth +5% Year ended 31 March 2015 (US$ millions) volume +1%, price/ mix +3% 18 (6) 30 105 3% 27,653 (4%) 1% (2%) 690 3% 1% Group NPR (2%) 5% 4% 380 Volume growth Price / mix 3% 3% 26,436 March 2014 Latin Africa A
Slide 8: Group EBITA growth and margin expansion
Driving growth and absolute profits: group EBITA growth of 6%* and margin expansion of 30 bps* Year ended 31 March 2015 (US$ millions) 2,224 1,907 Reported EBITA 858 768 700 Latin America Africa Asia Pacific Europe North America Reported EBITA 38.6% 25.6% 19.9% 15.9% 18.3% margin EBITA growth* 8% 6%
Slide 9: Input costs benefiting from global procurement savings
Input costs benefiting from savings delivered through our global procurement organisation • Full year constant currency increase per hl: – Total raw materials1 in line with prior2 – Total COGS1 up low single digits2 • Transactional FX headwinds especially in the second half of the year • Global proc
Slide 10: Continued focus on driving cost efficiencies
Continued focus on driving cost efficiencies in order to invest behind growth • Investing in global initiatives to enhance scale and skills – Cost and efficiency programme delivered US$221 million of cost savings in the first year – Exceptional costs of US$691 million in the year, down from US$133 m
Slide 11: Strong free cash flow generation, up US$670 million
Strong free cash flow generation, up US$670 million to US$3,233 million US$m (reported) March 15 March 14 Group EBITDA 7,762 7,884* Adjusted EBITDA1 6,677 6,656* Working capital inflow, incl. provisions 132 93 Capex2 (1,572) (1,485) Free cash flow1,3 3,233 2,563 • Tsogo Sun proceeds US$971 million e
Slide 12: Healthy balance sheet
Healthy balance sheet US$m March 15 March 14 Net debt (10,465) (14,303) Gearing (%) 43.0 52.0 Net debt / Adjusted EBITDA1 1.6 2.1* Weighted average interest rate for gross debt portfolio (%) 3.5 3.9 • Net debt down US$3,838 million; US$1,278 million reduction from maintaining a proportion of debt in
Slide 13: Strong cash flow enabling investment in growth and higher dividends
Strong cash flow enabling investment in growth and higher dividends • Focus on driving superior organic growth – Incremental investment to support strategic priorities and ambition • Value adding M&A will be considered – financial disciplined approach – Active participation in industry consolidation
Slide 14: Financial outlook – current financial year
Financial outlook –current financial year • Confidence in our strategy to deliver sustainable underlying growth for shareholders • Trading environment is expected to remain challenging – we anticipate ongoing key currency depreciation against the US dollar • Input costs per hl expected to rise: – To
Slide 15: Operational review
Operational review Alan Clark Chief Executive
Slide 16: Latin America
Latin America Affordability and premiumisation driving performance • Strong NPR growth through selective pricing, improved mix and soft drinks volume growth • Increased focus on affordability • Category expansion driven by light variants, innovation and non-alcoholic beverages • Variable and fixed c
Slide 17: Africa
Africa Strong topline performance from multi-beverage portfolio • NPR growth from volume and mix gains • Strong soft drinks performance • Excellent South African volume and NPR growth • Strong Mozambique and Nigeria volumes • Further capacity delivered and projects continuing • Integration has ident
Slide 18: Asia Pacific - Australia
Asia Pacific - Australia Driving premiumisation and market position • Consumer sentiment weighing on overall economy • Market share increase, progress with key accounts • Growth from focused brand positioning • Return to price & revenue growth in the second half • Annualised cost saving target deliv
Slide 19: Asia Pacific – China & India
Asia Pacific – China & India Driving premiumisation and market position China • Volume recovery after poor peak season • Continuing premiumisation of Snow brand family • Piloting of global brands India • Constrained by regulatory activity; bifurcation of a key state, Andhra Pradesh © SABMiller 2015
Slide 20: Europe
Europe Business stabilised in the year • Increased focus on effective sales execution • Marked improvement in Czech Republic & Slovakia • Effective romancing of core brands • Stepped up innovation and premiumisation • Better cost productivity funding topline investment • Improved results from Anadol
Slide 21: North America
North America Shifting the mix through above premium innovation • Stemming the trend for Miller Lite • Successful, sustained, large scale innovation in above premium • Flavour innovation and improved marketing in economy portfolio © SABMiller 2015 21
Slide 22: Soft drinks
Soft drinks Strong volume growth • African growth through price moderation and strong retail execution • Pack innovations drive growth in Latin America • Continued momentum in Coca-Cola Icecek in Europe © SABMiller 2015 22
Slide 23: Improving livelihoods and building communities
Improving livelihoods and building communities Prosper A Resilient A Thriving World A Sociable World WorldWorld A Resilient A Clean World A Productive World © SABMiller 2015 23
Slide 24: Our key strategic choices to drive superior long term growth
Our key strategic choices to drive superior long term growth Drive superior topline growth through 1 strengthening our brand portfolios and expanding the beer category Liberate and improve resource, win in market 2 and reduce costs Actively shape our global mix to drive a 3 superior a growth profile
Slide 25: Sourcing superior growth
Drive superior topline growth Sourcing superior growth A strategy to improve 2 our brand portfolios Improving and grow the premium category mix 4 1 5 Romancing Extending Capturing core lager refreshment wine and occasions spirits occasions Ensuring affordability 3 © SABMiller 2015 25
Slide 26: Romancing core lager
Drive Drive superior superiortopline topline growth growth Romancing core lager Romance core lager brands to defend and Establish easy-drinking sub-category to expand grow volumes as an everyday beverage with the relevance of lager and gain volume from core consumers mixed gender occasions © SABMill
Slide 27: Romancing core lager across geographies
Drive Drive superior Access superiortopline topline to formal alcohol growth growth Romancing core lager across geographies Hero lager, Nigeria Great Northern, Australia Tank beer, Europe • Consumer insights to develop • Easy drinking, contemporary regional • Reinvigorating the on-premise relevant l
Slide 28: Improving premium mix
Drive Drive superior Access superiortopline to formaltopline alcohol growth growth Improving premium mix Stretch price ladders to create ‘trade-up’ Drive premium mix within portfolio to grow pathways and capture greater share of NPR ahead of volume consumer spend © SABMiller 2015 28
Slide 29: Increasing momentum behind our global brands
Drive Drive superior superiortopline topline growth growth Increasing momentum behind our global brands New formats New brand architecture • Momentum in UK & USA • Orientated to premium • Strong package segment, growth and innovation catering to comparative price segment new occasions positioning. N
Slide 30: Local premium brands: improving the premium mix
Drive Drive superior superiortopline topline growth growth Local premium brands: improving the premium mix Castle Lite, Africa Redd’s, MillerCoors Club Colombia • Roll out across Africa • Franchise bolstered with new • Packaging and communication • Powerful marketing and innovation mix brand extensi
Slide 31: Ensure affordability to drive volume growth and category expansion
Drive Drive superior superiortopline topline growth growth Ensure affordability to drive volume growth and category expansion Adopt pricing moderation and Create affordable beverages to price points to ensure and access lower income consumers maintain affordability © SABMiller 2015 31
Slide 32: Ensuring affordability to drive volume growth
Drive Drive superior superiortopline topline growth growth Ensuring affordability to drive volume growth and category expansion Africa - Chibuku and Impala Latin America – deep affordability • Chibuku Super available in five markets • Bulk pack strategy with cannibalisation managed • Strong Impala g
Slide 33: Extending refreshment occasions
Drive Drive superior superiortopline topline growth growth Extending refreshment occasions Launch flavoured beer / radlers to grow volume Launch ciders to grow volume from new from new refreshment needs and occasions refreshment needs and occasions © SABMiller 2015 33
Slide 34: Extending refreshment occasions through flavours
Drive Drive superior superiortopline topline growth growth Extending refreshment occasions through flavours Flying Fish & Castle Lite Lime, SA Radlers, Europe Leinenkugel’s, MillerCoors • New flavoured beer sub-category • Targeting mixed gender • Flavour innovation, driving attracting male and femal
Slide 35: Liberate resources to win in market and reduce costs
Liberating resources to win in market and reduce costs Liberate resources to win in market and reduce costs Total procurement spend under global • Significant progress on end to end supply management, % average for the year chain integration • 69% total procurement spend under global 80 management •
Slide 36: Liberate resources to win in market and reduce costs
Liberating resources to win in market and reduce costs Liberate resources to win in market and reduce costs Win with leading Examples: execution across • Reinvigorating the on-trade in Czech Republic channels and ‘Building with Beer’ in MillerCoors • Retailer training and tools in Latin America • Br
Slide 37: Actively shape our global mix to drive a superior growth profile
Shape global mix to drive superior growth Actively shape our global mix to drive a superior growth profile CCBA combined African footprint Coca-Cola Beverages Africa Ethiopia • Integration programme underway Uganda • Competition commission filings Kenya submitted Tanzania Comoros Mayotte Zambia Nami
Slide 38: Well-placed to drive superior sustainable long-term growth
Well-placed to drive superior sustainable long-term growth • Broad exposure to growth markets, strong portfolio with beers and beverages, capabilities to drive growth • Focused strategy of developing the beer category and premiumisation • Increasing exposure to growing soft drinks • Leveraging our s
Slide 39: Q&A
Q&A
Slide 40: Supplementary information
Supplementary information © SABMiller 2014
Slide 41: Financial performance summary: Reported and organic
Financial performance summary: Reported and organic March 2015 Reported Organic Total volumes 1.9% 1.5% Lager volumes 0.4% (0.2)% Soft drink volumes 7.6% 7.7% Organic, Reported constant currency* Group net producer revenue (NPR) (1.6)% 4.6% Group NPR per hl (3.4)% 3.1% EBITA (1.4)% 5.8% EBITA margin
Slide 42: Reported results reflect strengthening US dollar and Tsogo Sun disposal
Reported results reflect the impact of the strengthening US dollar and the disposal of TsogoSun Group Adjusted March 2015, year on year growth NPR EBITA EPS % % % Reported growth rate (1.6) (1.4) (1.2) Impact of currency translation 5.3 5.7 6.1 Reported, constant currency growth rate 3.7 4.3 4.9 Imp
Slide 43: Reported financial performance summary
Reported financial performance summary1 March 2015 2013 20142 2015 Lager volumes (hl’m) 242 245 246 Total volumes (hl’m) 306 318 324 Group net producer revenue (NPR) 26,932 26,719 26,288 Group EBITA 6,379 6,460 6,367 Group EBITA margin 23.7% 24.2% 24.2% Group EBITDA 7,741 7,884 7,762 Group EBITDA ma
Slide 44: Organic, constant currency growth by region
Organic, constant currency growth by region Organic, constant currency Latin Asia North Africa Europe Group growth % America Pacific America Group NPR 7 9 1 2 - 5 Group NPR / hl 3 4 3 1 3 3 Total beverage volume 3 5 (2) 1 (2) 1 Lager volume 1 4 (2) - (2) - EBITA 8 6 (4) 6 7 6 EBITA margin (bps chang
Slide 45: Regional tabular disclosure on a group basis
Regional tabular disclosure on a group basis Latin North Retained Hotels & 2015 (US$'m) Africa Asia Pacific Europe Corporate Group America America Operations Gaming Group revenue 7,812 9,074 5,339 5,861 5,344 - 33,430 128 33,558 Excise and similar taxes (2,044) (1,612) (1,472) (1,463) (662) - (7,253
Slide 46: Regional tabular disclosure on a subsidiary basis
Regional tabular disclosure on a subsidiary basis Subs + Other Total Latin Asia North Hotels & Share of Total 2015 (US$'m) Africa Europe Corporate Subs. Share of Assocs./ Assocs./ America Pacific America Gaming MC JV Group MC JV JVs JVs Group revenue 7,812 6,853 3,136 4,186 143 - - 22.130 5,201 27,3
Slide 47: Group NPR (including associates and joint ventures)
Group NPR (including associates and joint ventures) Components of performance Year ended 31 March 2015 Organic, constant currency growth (US$ million) +5% +3% 27,653 52 832 1,417 +1% 26,719 385 283 26,436 26,288 March 2014 Disposals March 2014 Volume Price & March 2015 Acquisitions Currency March 20
Slide 48: EBITA (including associates and joint ventures)
EBITA (including associates and joint ventures) Components of performance months to 30 September 2014 Year ended 31 March 2015 Organic, constant currency growth (US$ million) +6% 6,738 1 368 372 6,460 90 6,370 6,367 March 2014 Disposals March 2014 Underlying March 2015 Acquisitions Currency March 20
Slide 49: Reported volumes
Reported volumes* Reported domestic lager volumes by country, hl ’000 March March % Change % Change 15 15 China ** 58,595 (1) Czech Republic 6,767 5 South Africa 27,901 2 Ecuador 5,924 2 Colombia 20,183 - Romania 5,576 (2) Poland 13,506 2 India 5,190 1 Peru 13,271 2 Italy 3,343 (1) Australia 7,070 (
Slide 50: Exchange rates
Exchange rates Year ended 31 March 2015 Appreciation/ Appreciation/ Average rate Closing rate (depreciation) (depreciation) 2015 2014 % 2015 2014 % Australian dollar (AUD) 1.15 1.07 (6) 1.31 1.08 (18) South African rand (ZAR) 11.08 10.13 (9) 12.13 10.53 (13) Colombian peso (COP) 2,097 1,920 (8) 2,57
Slide 51: Adjusted EPS and dividends: reported growth vs. prior year
Adjusted EPS and dividends: reported growth vs. prior year 8% 8% EPS EPS EPS Dividend per (US dollar) (Sterling) (South African share rand) (US dollar) (1%) (3%) © SABMiller 2015 51
Slide 52: Reported EBITA contribution
Reported EBITA contribution* March 2015 March 2014 13% 12% 35% 11% 34% 11% 12% 13% 29% 30% Latin America Africa Asia Pacific Europe North America * Retained operations before corporate costs and South Africa: Hotels and Gaming © SABMiller 2015 52
Slide 53: Net debt: currency and maturity profile
Net debt as at 31 March 2015: currency and maturity profile Currency profile Maturity profile * 6% 15% 21% 14% 43% 51% 4% 7% 9% 30% US dollar Euro < 1 year 1-2 years South African rand Colombian peso 2-5 years > 5 years Australian dollar Other * Cash and cash equivalents netted against current borro