Davide Campari-Milano N.V. · MIL:CPR
Davide Campari-Milano — 9M 2020 Earnings Presentation
44 slides from Davide Campari-Milano's earnings presentation, Oct 27, 2020
Slide 1: 2020 Nine Month Results
2020 Nine Month Results Investor Presentation
Slide 2: Table of Contents
TABLE OF CONTENTS Results Summary Sales Results ‒ By region ‒ By brand Consolidated P&L Net Financial Debt Marketing initiatives & Developments Conclusion & Outlook Annex Nine month results to 30 September 2020 2
Slide 3: Results for Nine Months Ended 30 September 2020
RESULTS FOR NINE MONTHS ENDED 30 SEPTEMBER 2020 OVERALL PERFORMANCE IN Q3 IMPROVED, BOOSTED BY IMPACT OF STAYCATION ON APERITIFS IN PEAK SUMMER SEASON 9M 2020 Change vs. 9M 2019 Q3 2020 Key figures € million % on sales Reported Organic FX Perimeter (1) Organic change Net sales 1,282.5 100.0% -1.6% -
Slide 4: Key Highlights
KEY HIGHLIGHTS UNDERLYING BRAND HEALTH CONFIRMED IN CORE MARKETS. TEMPORARY ON-PREMISE RECOVERY IN A CONTINUED CHALLENGING ENVIRONMENT > Net Sales > The nine month performance showed an organic improvement (-2.8%), driven by a very positive Q3 (+12.9%), while the ongoing effect of the COVID-19 pande
Slide 5: Table of Contents
TABLE OF CONTENTS Results Summary Sales Results ‒ By region ‒ By brand Consolidated P&L Net Financial Debt Marketing initiatives & Developments Conclusion & Outlook Annex Nine month results to 30 September 2020 5
Slide 6: Temporary Recovery in On-Premise Skewed Aperitifs in Q3, Led by SEMEA
TEMPORARY RECOVERY IN ON-PREMISE SKEWED APERITIFS IN Q3, LED BY SEMEA CONTINUED RESILIENCE IN OFF-PREMISE SKEWED NORTHERN EUROPEAN MARKETS, AUSTRALIA AND CANADA 9M 2020 Net sales by Region 9M 2020 Net sales by Priority (1) (1) Including Rest of Portfolio, down -7.2% in 9M 2020 > Americas: US flat ov
Slide 7: Strong Brand Momentum in the US and Across Aperitifs in Europe
STRONG BRAND MOMENTUM IN THE US AND ACROSS APERITIFS IN EUROPE Campari Group’s outperformance vs. US spirits market since lockdown1) Campari Group’s outperformance in US by key brand since lockdown(1) 240% 100% 25.0% 210% 80% 20.0% 180% % volume change % volume change 150% % Outperformance 60% 15.0%
Slide 8: Net Sales Results for the First Nine Months 2020
NET SALES RESULTS FOR THE FIRST NINE MONTHS 2020 GROWTH DRIVERS Organic change -2.8% -1.5% +2.7% % change €million 1,303,8 -37.1 -19.6 +35.4 1,282.5 9M 2019 Organic Forex Perimeter 9M 2020 > Organic change of -2.8% or €(37.1) million in a continued challenging environment, despite improving trends i
Slide 9: Net Sales by Regions & Key Markets in 9M 2020
NET SALES BY REGIONS & KEY MARKETS IN 9M 2020 US REMAINS THE LARGEST MARKET WITH 28.9% OF GROUP NET SALES 9M 2020 Net sales €1,282.5 million Organic growth -2.8% Others 1.5% Australia 5.5% USA 28.9% Others 7.3% Asia Pac: 7.0% of total UK 2.8% Organic growth: +5.5% Russia 2.2% Americas: 43.1% of tota
Slide 10: Americas: -3.6% Organic
AMERICAS (1) : -3.6% ORGANIC % change -3.6% -2.5% +0.6% Regional net sales €million 584.7 (20.8) -14.9 +3.2 552.2 quarterly growth Q1 Q2 Q3 2020 -0.9% -13.5% 4.3% 2019 13.1% 7.3% 0.5% 9M 2019 Organic Forex Perimeter 9M 2020 Organic growth by key market in 9M 2020 +0.1% • Overall flattish performance
Slide 11: SEMEA: -14.2% Organic
SEMEA (1) : -14.2% ORGANIC % change -14.2% +0.1% +10.3% Regional net sales €million 362.6 (51.6) +0.2 +37.5 348.7 quarterly growth Q1 Q2 Q3 2020 -23.0% -39.8% 23.8% 2019 6.4% 8.6% 8.9% (2) 9M 2019 Organic Forex Perimeter 9M 2020 Organic growth by key market in 9M 2020 > Italy -11.6% • Overall declin
Slide 12: NCEE: +11.3% Organic
NCEE (1) : +11.3% ORGANIC % change +11.3% -0.7% -2.0% Regional net sales €million 268.7 30.5 -2.0 -5.3 291.8 quarterly growth Q1 Q2 Q3 2020 6.6% 5.4% 20.2% 2019 11.6% 4.2% 10.4% 9M 2019 Organic Forex Perimeter 9M 2020 Organic growth by key market in 9M 2020 > Germany +11.6% • Solid growth overall in
Slide 13: Asia Pacific: +5.5% Organic
ASIA PACIFIC (1) : +5.5% ORGANIC % change +5.5% -3.4% 0.0% Regional net sales €million 87.8 +4.8 -3.0 0.0 89.7 quarterly growth Q1 Q2 Q3 2020 3.5% 10.1% 2.9% 2019 -3.1% 4.9% 0.7% 9M 2019 Organic Forex Perimeter 9M 2020 Organic growth by key market in 9M 2020 > Australia +21.0% • Very positive growth
Slide 14: Net Sales by Key Brand
NET SALES BY KEY BRAND 9M 2020 Net sales €1,282.5 million Organic growth -2.8% Agency brands & Co-packing 7% Rest of Portfolio: 14% Rest of own brands 7% Local Priorities, 12% Organic change: -0.9% Global Priorities, 58% Organic change- 2.6% Regional Priorities,16% Organic change: -1.3% Nine month r
Slide 15: Brand Sales Review: Global Priorities
BRAND SALES REVIEW GLOBAL PRIORITIES Brand sales as Organic Organic Global % of Group’s change change priorities in 9M 2020 sales in 9M 2020 in Q3 2020 > Acceleration in the peak Q3 period driven by double-digit growth in core on-premise skewed Italy (c.35% of total Aperol sales in FY 2019) as the b
Slide 16: Brand Sales Review: Global Priorities
BRAND SALES REVIEW GLOBAL PRIORITIES Brand sales as Organic Organic Global % of Group’s change change priorities in 9M 2020 sales in 9M 2020 in Q3 2020 > Positive growth overall for Wild Turkey bourbon in Q3 driven by the core markets of the US and Australia. 8% (1)(2) -4.3% +2.5% The brand continue
Slide 17: Brand Sales Review: Regional Priorities
BRAND SALES REVIEW REGIONAL PRIORITIES Brand sales as Organic Organic Regional % of Group’s change change priorities in 9M 2020 sales in 9M 2020 in Q3 2020 > Outperformance driven by the core US market (+34.3%) after a very strong Q3 (+131.6%) as the brand benefitted from a strong category momentum
Slide 18: Brand Sales Review: Regional Priorities
BRAND SALES REVIEW REGIONAL PRIORITIES Brand sales as Organic Organic Regional % of Group’s change change priorities in 9M 2020 sales in 9M 2020 in Q3 2020 Italian bitters and liqueurs 3% -18.3% -8.5% > Overall negative performance in the on-premise skewed bitters and liqueurs, largely due to declin
Slide 19: Brand Sales Review: Local Priorities
BRAND SALES REVIEW LOCAL PRIORITIES Brand sales as Organic Organic Local % of Group’s change change priorities in 9M 2020 sales in 9M 2020 in Q3 2020 > Strong recovery in core Italy during the Q3 period, benefiting from the on-premise re-opening in the peak summer 3% -10.4% +46.3% season 3% -16.3% +
Slide 20: Table of Contents
TABLE OF CONTENTS Results Summary Sales Results ‒ By region ‒ By brand Consolidated P&L Net Financial Debt Marketing initiatives & Developments Conclusion & Outlook Annex Nine month results to 30 September 2020 20
Slide 21: 9M 2020 Consolidated P&L
9M 2020 CONSOLIDATED P&L 9M 2020 Q3 2020 Organic margin Organic margin Reported Organic Forex Perimeter Organic 9M 2020 9M 2019 accretion/ accretion/ change change impact effect change (dilution) (dilution) € million % of sales € million % of sales % (bps) (3) % % % (bps) (3) % Net Sales 1282.5 100.
Slide 22: EBIT Adjusted Margin – Key Drivers
EBIT ADJUSTED MARGIN – KEY DRIVERS Organic +80 bps +10 bps 22.1% -270 bps -80 bps 19.4% -280 bps 9M 2019 Gross Margin A&P SG&A FX & Perimeter 9M 2020 > Gross profit: on a reported basis down -5.8% in value, to 59.4% on sales (-260 bps dilution): • Organic change of -7.1% in value, leading to -270 bp
Slide 23: EBIT Adjusted – Summary Effects
EBIT ADJUSTED – SUMMARY EFFECTS (43.4) € million 9.3 (5.4) % change -15.1% +3.2% -1.9% 288.0 248.5 -13.7% 9M 2019 Organic Forex Perimeter 9M 2020 > EBIT adjusted: on a reported basis down -13.7% in value, at 19.4% on net sales, down from 22.1% from last year • Organic decline of -15.1% in value with
Slide 24: 9M 2020 Consolidated P&L – Group Pre-Tax Profit
9M 2020 CONSOLIDATED P&L – GROUP PRE-TAX PROFIT 9M 2020 9M 2019 Reported change €million % of sales €million % of sales % EBIT adjusted 248.5 19.4% 288.0 22.1% -13.7% Operating adjustments (48.3) -3.8% (13.9) -1.1% - Operating profit = EBIT 200.3 15.6% 274.1 21.0% -26.9% Net financial income (charge
Slide 25: Table of Contents
TABLE OF CONTENTS Results Summary Sales Results ‒ By region ‒ By brand Consolidated P&L Net Financial Debt Marketing initiatives & Developments Conclusion & Outlook Annex Nine month results to 30 September 2020 25
Slide 26: Net Financial Position
NET FINANCIAL POSITION Δ 30 September 2020 vs. € million 30 September 2020 31 December 2019 31 December 2019 Short-term cash/(debt) (A) (96.7) 71.5 (168.2) - Cash and cash equivalents (1) 758.6 704.4 54.2 - Short-term deb t (855.4) (633.0) (222.4) (1) Medium to long-term cash/(debt) (B) (824.5) (666
Slide 27: Table of Contents
TABLE OF CONTENTS Results Summary Sales Results ‒ By region ‒ By brand Consolidated P&L Net Financial Debt Marketing initiatives & Developments Conclusion & Outlook Annex Nine month results to 30 September 2020 27
Slide 28: Campari – Celebrating Art and Cinema
CAMPARI – CELEBRATING ART AND CINEMA VENICE & NEW YORK FILM FESTIVAL The bond between Campari and cinema took the stage again between September 2nd and 12th at the 77th Venice International Film Festival and from September 27th to October 13th at the 58th New York Film Festival, celebrating the valu
Slide 29: Negroni Week & Red Passion Digital Campaign
NEGRONI WEEK & RED PASSION DIGITAL CAMPAIGN ‘RAISE A NEGRONI TO YOUR BAR’ CAMPARI: RED PASSION Campari, the iconic Italian red aperitif has launched an inspirational new digital campaign featuring a Campari and Imbibe Magazine continue to unique partnership with remarkable artists from around the wo
Slide 30: Aperol Spritz – Edutainment and Digital Competitions
APEROL SPRITZ – EDUTAINMENT AND DIGITAL COMPETITONS APEROL SPRITZ CHALLENGE - #SHAREASPRITZ & NATIONAL #HOMEAPERITIFS – SPAIN ITALY PROSECCO DAY TAKEOVER - UK Aperol launched an edutainment content to teach the perfect serve Aperol UK launched the #ShareASpritz campaign, celebrating the of Aperol Sp
Slide 31: US Focus – Wild Turkey & Espolòn
US FOCUS – WILD TURKEY & ESPOLÒN WILD TURKEY LONGBRANCH & ESPOLÒN – MEXICAN INDEPENDENCE RARE BREED RYE DAY Espolòn Tequila launched a national digital campaign around Mexican Independence Day week (on 16th Wild Turkey went live with the first ever dedicated digital September). This campaign is live
Slide 32: Brand and Global Campaign Launches
BRAND AND GLOBAL CAMPAIGN LAUNCHES CRODINO AVERNA: OPEN SICILY With the aim of reinforcing the presence of Campari Group in the Non-Alcoholic category, the original Averna has launched its first ever global campaign, ‘Open Sicily’, which celebrates the vibrant world of Sicily non-alcoholic drink and
Slide 33: Table of Contents
TABLE OF CONTENTS Results Summary Sales Results ‒ By region ‒ By brand Consolidated P&L Net Financial Debt Marketing initiatives & Developments Conclusion & Outlook Annex Nine month results to 30 September 2020 33
Slide 34: Looking Forward: Persistent Uncertainty in the Short Term
LOOKING FORWARD: PERSISTENT UNCERTAINTY IN THE SHORT TERM, CONFIDENCE FOR THE LONG-TERM BUSINESS MOMENTUM > With the progressive uplift of restrictive measures towards the end of the second quarter, the Group’s business performance in the third quarter largely benefited from the staycation effect. T
Slide 35: Table of Contents
TABLE OF CONTENTS Results Summary Sales Results ‒ By region ‒ By brand Consolidated P&L Net Financial Debt Marketing initiatives & Developments Conclusion & Outlook Annex Nine month results to 30 September 2020 35
Slide 36: Annex
Annex - 1 Net sales by region and key market Annex - 2 Net sales by brand cluster Annex - 3 Q3 2020 consolidated income statement Annex - 4 Eurobonds and Term Loan details Annex - 5 Exchange rates effects 36
Slide 37: Net Sales by Region & Key Market
Annex - 1 NET SALES BY REGION & KEY MARKET Consolidated Net sales by region 9M 2020 9M 2019 Change of which: Q3 2020 €m % €m % % organic perimeter forex organic Americas 552.2 43.1% 584.7 44.8% -5.6% -3.6% 0.6% -2.5% 4.3% Southern Europe, Middle East & Africa 348.7 27.2% 362.6 27.8% -3.8% -14.2% 10.
Slide 38: Net Sales by Region & Key Market
Annex - 1 NET SALES BY REGION & KEY MARKET Southern Europe, Middle East & Africa by market 9M 2020 9M 2019 Change of which: Q3 2020 €m % €m % % organic perimeter forex organic Italy 235.7 67.6% 266.3 73.4% -11.5% -11.6% 0.1% 0.0% 35.4% France 72.1 20.7% 29.1 8.0% 147.9% 49.5% 98.4% 0.0% 151.8% GTR 7
Slide 39: Net Sales by Brand Cluster
Annex - 2 NET SALES BY BRAND CLUSTER Consolidated Net sales by brand cluster 9M 2020 9M 2019 Change of which: Q3 2020 €m % €m % % organic perimeter forex organic Global Priorities 745.4 58.1% 772.4 59.2% -3.5% -2.6% 0.0% -0.9% 10.7% Regional Priorities 205.3 16.0% 193.7 14.9% 6.0% -1.3% 8.5% -1.2% 1
Slide 40: Q3 2020 Consolidated Income Statement
Annex - 3 Q3 2020 CONSOLIDATED INCOME STATEMENT Reported Organic Forex Perimeter Q3 2020 Q3 2019 change change impact effect € million % of sales € million % of sales % % % % Net Sales 513.8 100.0% 455.6 100.0% 12.8% 12.9% -4.0% 3.9% COGS (1) (205.2) -39.9% (172.8) -37.9% 18.7% 17.5% -6.7% 7.9% Gros
Slide 41: Eurobonds and Term Loan Details
Annex - 4 EUROBONDS AND TERM LOAN DETAILS Eurobonds and Term Loan composition post Eurobond 2027 issue (6 October 2020) Outstanding Original As % of Issue date Maturity Type Currency Coupon Amount tenor total (€ million) Apr 5, 2017 Apr-22 Unrated Eurobond EUR 1.768% 50 5 years 4% Apr 5, 2017 Apr-24
Slide 42: Exchange Rates Effects
Annex - 5 EXCHANGE RATES EFFECTS Average exchange rate Period end exchange rate change vs 9M 2020 change vs 9M 2019 30 September 2020 30 September 2019 : 1 Euro % : 1 Euro % US Dollar 1.124 0.0% 1.171 -7.0% Canadian Dollar 1.521 -1.8% 1.568 -8.0% Jamaican Dollar 159.099 -6.6% 165.872 -11.7% Mexican
Slide 43: Disclaimer
DISCLAIMER This document contains forward-looking statements that relate to future events and future operating, economic and financial results of Campari Group. By their nature, forward-looking statements involve risk and uncertainty because they depend on the occurrence of future events and circums
Slide 44: Contacts
C A M PA R I G R O U P.C O M CONTACTS i n ve s t o r. r e l a t i o n s @ c a m p a r i . c o m C A M PAR I O F F I C I A L @ G R U P P O C A M PAR I C AM PA R I G R O U P Nine month results to 30 September 2020
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