Coca-Cola Icecek A.S. · BIST:CCOLA
Coca-Cola Icecek A.S — Credit Suisse Conference 2007 - Turkey in Pole Position II
48 slides from Coca-Cola Icecek A.S's conference presentation, August 2007
Slide 1: Turkey in Pole Position II
“Turkey in Pole Position II” Credit Suisse Conference August 23-25, 2007 İstanbul 1
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation includes forward-looking statements including, but not limited to, statements regarding Coca-Cola İçecek’s (“CCI”) plans, objectives, expectations and intentions and other statements that are not historical facts. Forward- looking statements can generally
Slide 3: Business Overview & Strategy
Business Overview &Strategy 3
Slide 4: Healthy Growth in 1H2007
Healthy Growth in 1H2007 Turkey Volume International Volume Consolidated Volume (Unit cases in millions) (Unit cases in millions) (Unit cases in millions) 12.2% 9.1% 28.2% 220 180 45 180 160 35 160.0 174.5 194.2 217.9 34.1 43.7 140 140 25 100 1H06 1H07 1H06 1H07 1H06 1H07 On a pro-forma basis, conso
Slide 5: Strong Growth in 1Q2007
Strong Growth in 1Q2007 Turkey Net Sales International Net Sales Consolidated Net Sales (CMB - YTL in millions) (CMB – US$ in millions) (CMB - YTL in millions) 270 45 44.9% 340 260 11.5% 40 320 17.2% 35 250 300 30 240 25 280 230 20 260 220 15 29.6 42.9 235.2 262.3 10 240 274.5 321.7 210 5 220 200 0
Slide 6: Strong Growth in 1Q2007
Strong Growth in 1Q2007 Turkey EBITDA International EBITDA Consolidated EBITDA (CMB - YTL in millions) (CMB – US$ in millions) (CMB - YTL in millions) 6.3% 5 109.5% 38 31 4 36 18.0% 37.3 4.4 30.6 34 29 3 28.8 2 32 27 2.1 31.6 30 12.2% 11.7% 1 7.1% 10.3% 11.5% 11.6% 25 0 28 1Q06 1Q07 1Q06 1Q07 1Q07 1
Slide 7: 1Q2007 Highlights
1Q2007 Highlights Turkey performing well Very strong organic growth in Central Asia Middle East making good progress New source water Damla launched in March 2007 Capital Investment program on track 7
Slide 8: Business Overview
Business Overview Operate 12 Bottling Plants with 4,178 employees Operate in 9 countries with an aggregate population of more than 170 million people Aggregate production capacity of 573 million unit cases 8
Slide 9: Operations in Countries With a Total Population of more than 170 Million
Operations in 9 Countries With a Total Population of more than 170 Million Population: 15mn GDP per capita 06: $5,016 GDP CAGR 00-06: 26.4% Population: 74mn GDP per capita 06: $5,482 Population: 9mn GDP CAGR 00-06: 10.9% GDP per capita 06: $2,326 GDP CAGR 00-06: 23.5% Population: 5mn Population: 7mn
Slide 10: Category & Brand Leadership – World-leading Brand Portfolio CSD
Category & Brand Leadership – World-leading Brand Portfolio CSD Turkey* Kazakhstan** Azerbaijan ** Kyrgyzstan*** Azerbaijan** Jordan* Iraq Syria Share** 65.1% 48.8% 51.6% 70.0%* 12.2% Position #1 #1 #1 #1 #2 Source: Canadean, AC Nielsen *December 2006 year-to-date data **November 2006 year-to-date d
Slide 11: Category & Brand Leadership – World-leading Brand Portfolio NCB
Category & Brand Leadership – World-leading Brand Portfolio NCB Turkey* Kazakhstan** Azerbaijan ** Azerbaijan** Kyrgyzstan* ** Kyrgyzstan*** Jordan Fruit Juices & Nectars #1 28.4% 7.8% #4 Bottled Water 4.7% #6 3% #8 37.5% #1 Other NCBs: Sports Drinks 94.6% #1 #1 Energy Drinks 34.1% #2 Iced Tea 19.6%
Slide 12: Geographic and Category Split of Business
Geographic and Category Split of Business Volume split (uc)* - Geography Volume split (uc)** - Category **2006 *1H2007 The business is becoming more diversified over time both geographically and in terms of product portfolio 12
Slide 13: Attractive Growth Markets – Our Focus Region
Attractive Growth Markets – Our Focus Region Russia Belarus CCI Ukraine Kazakhstan 15m CCHBC Moldova Romania Other Ca Black Sea Georgia Bulgaria sp 4m Uzbekistan ian Kyrgyzstan Azerbaijan 26m 5m Se Turkey 8m a Greece Turkmenistan 73m 6m Tajikistan China 7m Syria 19m Lebanon Afghanistan 4m Iraq Iran
Slide 14: Volume Breakdown by Country
Volume Breakdown by Country Volume split (uc)** - Geography Volume split (uc)* - Geography **2006 *1H2007 The business is becoming more diversified over time both geographically and in terms of product portfolio 14
Slide 15: Attractive Growth Markets – Existing Median Age
Attractive Growth Markets – Existing 2006 CSD Consumption PerCap in liters and Median Age 45 Source: Canadean, CIA, IMES and CCI Italy Germany Greece Bulgaria 40 Spain Russia UK USA Poland Hungary 35 Median Age Argentina 30 Kazakhstan Azerbaijan Turkey HIGH GROWTH Mexico Krygzstan 25 Jordan POTENTIA
Slide 16: Turkey Update
Cet ols Seecch Turkey Update
Slide 17: Turkey Volume
Turkey Volume Turkey Volume The recovery in demand, started in 1Q2007, (Unit cases in millions) 8% accelerated in 2Q2007 G R: 15. CA 380 10.2% Increase in marketing activities contributed to 330 13.3% increasing demand 280 24% 344 230 312 1.5L PET packages for Coca-Cola and Fanta 180 275 and Damla i
Slide 18: 2006 Alcohol Free Beverage Consumption
2006 Alcohol Free Beverage Consumption Hot tea category constitutes 49.8% of alcohol-free beverages CSDs is almost half of ready-to-drink alcohol-free beverages Alcohol-Free Beverages– 4,681 m uc Ready- Ready-to- Beverages– 1,056 m uc to-Drink Alcohol Free Beverages– Source : Canadean Source : Canad
Slide 19: Turkey – Trade Structure
Turkey – Trade Structure Half of volume delivered by traditional trade channels Highest retail coverage among all FMCG categories in Turkey Retail Volume by Channel (2006) 19 Source: Company
Slide 20: CSD Product Innovations - 2007
CSD Product Innovations - 2007 250 250 ml ml Owb Owb Multipack Multipack ““Pet Pet 450ml 450ml Grip Grip Bottle Bottle”” 1.5L 1.5L Coca -Cola Coca-Cola Nostalgic Nostalgic Shrink Shrink 6*450 ml Pet Fanta Fanta Mango&Orange Mango&Orange Fanta Fanta Splash Splash 1.5 1.5 Lt Lt Schweppes Schweppes Twi
Slide 21: NCB Product Innovations - 2007
NCB Product Innovations - 2007 Powerade Powerade Aseptic Aseptic Packaging Packaging Powerade Powerade Seasonal Seasonal Flavor Flavor 330 330 ml ml DAMLA DAMLA Nestea Nestea Aseptic Aseptic Packages Packages New New Nestea Nestea ““Cool” Cool” Natural Natural Source Source Water Water 21
Slide 22: International Operations Update
International Operations Update 22
Slide 23: International Operations - Volume
International Operations - Volume CCI experienced strong volume growth in all Full Year Volume international markets. (Unit cases in millions) 90 : 41. 9% Two new PET lines started production, and G R 80 CA four tetrapack lines under installation in 70 62.4% 80 Kazakhstan 60 23.3% 50 New preform inj
Slide 24: Kazakhstan
Kazakhstan Recent developments • Due to solid growth, production capacity of CSDs is further expanded in 2007. Start-up of juice production is planned for August. Marketing • CSD YTD share reached 48.8% in 2007, +3.4 pp vs 2005 • A series of music concerts under the theme of Coca-Cola Music Planet t
Slide 25: Azerbaijan
Azerbaijan Recent developments • Further expanded production capabilities in 2007; preform injection unit and pet line installed. Marketing • CSD YTD share reached 51.6%, +1.4pp vs 2005 • Expanding on branding and sampling activities focusing on Coke&Meal as well as Coke Side of Life • Continue to s
Slide 26: Kyrgyzstan
Kyrgyzstan Recent developments • Expanded warehouse capacity with a new satellite warehouse in Balikci • Kyrgystan production capacity streched to meet domestic demand, evaluating capacity increase option for future growth Marketing • Continue to strengthen ties with youth via 2nd leg of NBT star TV
Slide 27: Jordan
Jordan Recent developments • Efficiency improvements in production, logistics and cost accounting continues. • Key management in place; and working on upgrading skill levels of workforce Marketing • Expending consumer base with line extension and sampling as well as promotions. • Building brand pref
Slide 28: Iraq
Iraq Recent Developments • Local production plans in place, construction has started in Erbil Marketing • Extensive Coca-Cola sampling activities to penetrate into daily lives • Increasing Coca-Cola branding and presence in the market with shop signs, pop and other outdoor advertising Route to Marke
Slide 29: Syria
Syria Recent developments • CCI acqiured 50% of Syria Soft Drink Sales and Distribution through Efes Invest Holland B.V. • Building local capabilities via recruitment and extensive training. Marketing • Brand and advertising activities in place to support build-up awareness efforts. • Sampling activ
Slide 30: Financial Review
Financial Review 30
Slide 31: Introduction to Financial Statements
Introduction to Financial Statements Basis of Preparation Consolidated / Turkey International YTL/$ Exchange Rates Functional Currency YTL USD March 31, 2007 1.3801 Reporting Currency YTL USD December 31, 2006 1.4056 Net Sales – Net of discounts and special consumption tax for Turkish operations Inf
Slide 32: Key Financials
Key Financials Financial Period Ending March 31st 2007 2006 ’07 vs. ‘06 (YTL in millions unless otherwise stated) Sales Volume (UC m) 79.8 72.6 9.9% Net Revenue 321.7 274.5 17.2% Gross Profit 118.4 76.2 55.4% Gross Profit Margin 36.8% 27.8% EBITDA 37.3 31.6 18.0% EBITDA Margin 11.6% 11.5% EBIT 14.3
Slide 33: Balance Sheet
Balance Sheet Financial Period Ending Financial Year Ending Assets Liabilities andEquity Financial Period Ending Financial Year Ending March 31, 2007 December 31,2006 March 31, 2007 December 31, 2006 140.8 50.9 208.7 214.1 (YTL in millions unless otherwise stated) Cash & cash equivalents Short-term
Slide 34: 2007 Outlook
2007 Outlook Outlook EBITDA growth in excess of volume growth Management’s Focus Volume growth Revenue growth EBITDA margin CAPEX Capital spending is expected to be approximately 11% of revenues. Tax New VAT rates in Turkey, down from 18% to 8% for ∗ NCBs effective from June 1, 2007 ∗ CSDs effective
Slide 35: Appendix
Appendix 35
Slide 36: Macro and Industry Background Turkey
Macro and Industry Background Turkey Turkey Volume Development (m uc) Turkey at a snapshot... .7% R: 15 CA G Population - 2006 : 74 million (Source: EIU) 400 343,8 350 312,0 275,4 300 Category Share (CSDs 2006): 65.1% 250 222,1 (Source: AC Nielsen) 200 174,5 150 Current Brand Portfolio 100 50 – CSDs
Slide 37: Macro and Industry Background Kazakhstan
Macro and Industry Background Kazakhstan CC Kazakhstan Volume Development (m uc) % CAGR: 31 Kazakhstan at a snapshot... Population-2006 : 15 million (Source: EIU) 37,2 28,6 Category Share (CSDs 2006): 48.8% 23,6 (Source: AC Nielsen) 16,6 Current Brand Portfolio – CSDs: Coca-Cola, Coca-Cola light, Fa
Slide 38: Macro and Industry Background Azerbaijan
Macro and Industry Background Azerbaijan CC Azerbaijan Volume Development (m uc) % CAGR: 37.6 Azerbaijan at a snapshot... Population-2006 : 9 million (Source: EIU) 22,4 Category Share (CSDs 2006 : 51.6% 17,6 (Water 2006) : 37.5% 12,8 (Source: AC Nielsen) 8,6 Current Brand Portfolio – CSDs: Coca-Cola
Slide 39: Macro and Industry Background Kyrgyzstan
Macro and Industry Background Kyrgyzstan CC Kyrgyzstan Volume Development Kyrgyzstan at a snapshot... (uc m) .7% R: 19 CA G Population-2006 : 5 million (Source: EIU) 4,8 3,6 3,3 Current Brand Portfolio 2,8 – CSDs: Coca-Cola, Coca-Cola light, Fanta, Sprite 2003 2004 2005 2006 – Non-CSDs: BonAqua (wat
Slide 40: Macro and Industry Background Tajikistan
Macro and Industry Background Tajikistan Tajikistan at a snapshot... Population-2006 : 6 million (Source: EIU) GDP per Capita Age Breakdown as % of Population ($) 4.8% CAGR ‘00-’06: 362 14.8% 308 325 39.7% 234 167 187 158 57.4% 2000 2001 2002 2003 2004 2005 2006 0 - 14 15 - 64 > 65 Source: EIU Sourc
Slide 41: Macro and Industry Background Jordan
Macro and Industry Background Jordan Jordan at a snapshot... Population : 6 million (Source: EIU – March 2006) Category Share (CSDs 2006) : 12.2% (Source: AC Nielsen) Current Brand Portfolio – CSDs: Coca-Cola, Coca-Cola light, Fanta, Sprite, – NCBs: Riwa (water) GDP per Capita Age Breakdown as % of
Slide 42: Macro and Industry Background Iraq
Macro and Industry Background Iraq Iraq at a snapshot... Population -2006: 29 million (Source: EIU) Current Brand Portfolio – CSDs: Coca-Cola, Coca-Cola light, Fanta, Sprite, Canada Dry Age Breakdown as % of Population 3.0% 39.7% 57.3% 0 - 14 15 - 64 > 65 Source: CIA World Factbook and EIU 42
Slide 43: Macro and Industry Background Syria
Macro and Industry Background Syria Syria at a snapshot... Population-2006 : 20 million (Source: CIA World Fact Book) Current Brand Portfolio – CSDs: Coca-Cola, Coca-Cola light, Fanta, Sprite, Age Breakdown as % of Population 3.3% 37.0% 59.7% 0 - 14 15 - 64 > 65 43 Source: CIA World Factbook and EIU
Slide 44: Cooler Investments
Cooler Investments Cooler Doors per 10,000 Turkey Azerbaijan Krygzstan Kazakhstan Jordan 2005 35,6 6,2 7,3 11,9 37,5 2006 41,4 7,2 8,5 16 41,1 44
Slide 45: Shareholder Structure
Shareholder Structure (1) Anadolu Efes and its fully-owned subsidiaries (2) TCCC and its fully-owned subsidiaries 45
Slide 46: Board of Directors
Board of Directors Chairman of the Board Tuncay Özilhan CEO of Anadolu Group Vice Chairman of the Board Member of the Board Member of the Board Member of the Board Mehmet Cem Kozlu Michael A. O’Neill Recep Y. Argüden Ahmet Boyacıoğlu Consultant toNorth Consultant and Board CEO of CCI Board member of
Slide 47: Corporate Structure
Corporate Structure Coca-Cola Icecek A.Ş. 100,00 % Efes Invest Holland B.V., Coca-Cola Satis ve Dagitim The Netherlands 99,96 % A.S., Turkey 38,72 % Coca-Cola Almaty Bottlers 48,77 % LLP, Kazakhstan Mahmudiye Kaynak Suyu Ltd. Şti., Turkey 99,99 % Azerbaijan Coca-Cola Bottlers 16,31 % 73,60 % Ltd., A
Slide 48: Q&A Session
Q&A Session 48
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