Barry Callebaut AG · SIX:BARN
Barry Callebaut — Non-Deal Roadshow (November 2015)
44 slides from Barry Callebaut's roadshow presentation, November 2015
Slide 1: Roadshow Presentation – FY 2014/15
Roadshow Presentation – FY 2014/15 November 2015 November 2015
Slide 2: Agenda
FY Results 2014/15 Agenda Barry Callebaut at a glance First impressions & Highlights FY 2014/15 Performance FY 2014/15 The way forward Page 2 November 2015 FY14/15 Roadshow presentation
Slide 3: At a glance
[BARRY (()) CALLEBAUT] At a glance ws) a BARRY (CALLE BAUT]
Slide 4: We are present in the key parts of the cocoa and chocolate value chain
We are present in the key parts of the cocoa and chocolate value chain Page 4 November 2015 FY14/15 Roadshow presentation
Slide 5: Page 5 November 2015 FY14/15 Roadshow presentation
Page 5 November 2015 FY14/15 Roadshow presentation
Slide 6: Our Regional and Product split
FY 2014/15 Our Regional and Product split Sales Volume per Region Sales Volume per Product Group Gourmet & Asia Pacific Specialities 4% 10% Global Cocoa 28% Europe 42% Food Manu- facturers 62% Cocoa Products 28% Americas 26% Page 6 November 2015 FY14/15 Roadshow presentation
Slide 7: First impressions & Highlights FY 2014/15 - CEO Antoine de Saint-Affrique
First impressions & Highlights FY 2014/15 - CEO Antoine de Saint-Affrique November 2015
Slide 8: My first impressions
My first impressions Unique focus Disciplined Balancing People and Innovative the short Values deep expertise Entrepreneurial and long-term Performance Page 8 November 2015 FY14/15 Roadshow presentation
Slide 9: A view on the market
FY results 2014/15 A view on the market The new normal: volatile & complex A world of new opportunities • Currencies and economic growth • Consumer driven • Premiumization, personalization, taste, clean/clear labels, snacking • Sustainability & traceability • Customer centric • Innovate with & for c
Slide 10: 2014/15: delivering the short term, building for the long term
2014/15: delivering the short term, building for the long term Inaguration new CHOCOLATE Optimized cocoa Expansion of Chocolate Start-up of operations in Fermentation process, for Acquisition of American ACADEMY TM centers in Dubai, factory in Brazil and Poland our first Chocolate factory superior t
Slide 11: Barry Callebaut continues to significantly outperform the global chocolate market
FY results 2014/15 Barry Callebaut continues to significantly outperform the global chocolate market Sales volume growth +4.5%, significantly outperforming the market1 and accelerating in Q4 Broad-based growth mainly driven by developed markets, as well as outsourcing, Gourmet and emerging markets C
Slide 12: Performance FY 2014/15 – CFO Victor Balli
Performance FY 2014/15 – CFO Victor Balli November 2015
Slide 13: Volume growth above global market with acceleration in Q4
FY results 2014/15 Volume growth above global market with acceleration in Q4 (tonnes) +4.5% +10.7% 45'668 +3.7% +2.0% 15,208 +0.2% 16'090 1’050 1’794’782 1’716’766 Q1 Q2 Q3 Q4 Sales Volume FY 2014/15 Market Volume growth * -1.8% -1.7% -3.3% -3.9% -2.7% * Source: Nielsen chocolate confectionery in vo
Slide 14: ... and with positive contribution from our key growth drivers
FY results 2014/15 ... and with positive contribution from our key growth drivers Emerging Markets Long-term outsourcing & Gourmet & Specialties Strategic Partnerships Volume growth +5.1% vs prior year +6.6% vs prior year +6.0% vs prior year FY 2014/15 CAGR 5 year +17.3% +16.5% +6.5 % Volume 10% 33%
Slide 15: Solid volume growth gaining momentum, strong profit improvement in local currencies
FY results 2014/15 Solid volume growth gaining momentum, strong profit improvement in local currencies Group performance FY 2014/15 % vs prior year % vs prior year (in CHF) (in CHF) in local (In CHF mio.) currencies Sales Volume Total 1,794,782 +4.5% (in tonnes) Sales Revenue 6,241.9 +6.4% +12.1% Gr
Slide 16: Good performance in developed regions
FY results 2014/15 Good performance in developed regions Europe Americas Asia Pacific Global Cocoa 4% 4% 28% 28% 42% 26% 25% Volume growth +3.9% +4.7% +7.2% +5.1% EBIT growth in +19.7% -0.3% +5.9% -33.7% local currencies EBIT growth in CHF +8.1% +3.3% -0.4% -42.4% Page 16 November 2015 FY14/15 Roads
Slide 17: Gross profit up +4.8% in local currencies
Gross Profit FY 2014/15 Gross profit up +4.8% in local currencies, due to solid volume growth, strong focus on margins and despite a historically low cocoa combined ratio in CHF mio. -1.7% +4.8% 52.1 902.6 28.4 -24.5 -14.5 861.1 846.8 -55.8 Gross Profit Volume Product Mix Cocoa Add. Direct Gross Pro
Slide 18: Challenging cocoa market environment with negative impact from the cocoa combined ratio
Cocoa processing profitability Challenging cocoa market environment with negative impact from the cocoa combined ratio in FY 2014/15, strongly affecting current fiscal year European combined ratio - 6 months forward ratio FY 2014/15 4.0 3.0 Combined ratio 2.9 Butter ratio 2.0 1.0 Powder ratio 0.0 Oc
Slide 19: Cocoa Leadership Project
Cocoa Leadership Project Assert our leadership in Cocoa, fully leverage our scale and improve profitability Commercial leadership Centralized global steering Operations & Supply Chain leadership Differentiating and Centralizing key strategic Optimizing our cocoa repositioning the activities, such as
Slide 20: Operating profit improved 7.4% in local currencies
EBIT FY 2014/15 Operating profit improved 7.4% in local currencies, due to a good product & customer mix, as well as stricter fixed cost discipline in CHF mio. -0.3% +7.4% 41.5 447.1 -10.1 -0.4 416.2 414.8 -32.3 EBIT Additional Additional Add. Costs, other EBIT FX impact EBIT 2013/14 Gross Profit SG
Slide 21: Improvement of the EBIT per tonne in constant currencies continued
6-year EBIT per tonne development Improvement of the EBIT per tonne in constant currencies continued 312 282 290 274 279 EBIT per tonne 286 251 in constant currencies EBIT per tonne in CHF 256 242 (as reported) 231 223 +8.2% 1’717 1’795 1’379 1’536 1’210 1’269 Volume in kMT 2009/10 2010/11 2011/12 2
Slide 22: Net Profit -2.7% in local currencies (-5.9% in CHF)
From EBITDA to Net Profit Net Profit -2.7% in local currencies (-5.9% in CHF) , due to higher average financing requirements, a foreign exchange loss, as well as higher taxes in CHF mio. 540.8 -126.0 414.8 -130.7 -44.2 -5.9% 239.9 255.0 EBITDA Depreciation EBIT Net Financial Income Net Profit for th
Slide 23: Cocoa bean price still at relatively high levels, other raw materials below prior year
Raw materials evolution Cocoa bean price still at relatively high levels, other raw materials below prior year FY 14/15 FY vs. prior 300% year 250% Cocoa beans 200% +4% Sugar world 150% -9% 100% Sugar EU -21% 50% Milk powder -23% 0% Sep.2007 Sep.2008 Sep.2009 Sep.2010 Sep.2011 Sep.2012 Sep.2013 Sep.
Slide 24: Net Working Capital
Net Working Capital Working Capital below prior year as a result of reduction in inventories and positive currencies effect in CHF mio. Receivables Stocks Payables -8.7% +80 +170 +35 -111 -36 1’675 -114 1’530 -170 Net Growth Price and Growth Operational Growth Price impact Others and Net Working imp
Slide 25: Cash Flow improvement due to lower investment in working capital
Cash Flow Cash Flow improvement due to lower investment in working capital in CHF mio. -0.2% 474 473 -101 (PY -279) -145 (PY- 142) +87 +24 (PY +271) (PY +17) -205 (PY -227) -85 (PY -80) Operating Operating Investment in Interest paid Cash flow Dividend Cash flow from Net increase in Cash Flow* Cash
Slide 26: Balance Sheet & key ratios
Balance Sheet & key ratios Deleveraging of the company and improvement of key financial ratios remain a high priority Aug 15 Aug 14 Total Assets [CHF m] 5'429.4 5'167.5 Net Working Capital [CHF m] 1'529.7 1'674.6 Non-Current Assets [CHF m] 2'185.5 2'175.6 Net Debt [CHF m] 1'728.0 1'803.5 Shareholder
Slide 27: Proposed dividend of CHF 14.50, stable payout ratio of 33%
Dividend Proposed dividend of CHF 14.50, stable payout ratio of 33% Proposed dividend Payout ratio CHF 14.50 per share1 35% Payout of 33% of Net Profit 33% 33% 33% 31% Not subject to withholding tax2 255 240 223 177 Timetable for dividend 143 Shareholder approval: Dec 9, 2015 (AGM) Expected ex-date:
Slide 28: Long-term and continued strong volume and EBIT growth in a capital intensive business
5-year development Long-term and continued strong volume and EBIT growth in a capital intensive business Sales Volume EBIT CAGR +7.9% CAGR +9.1% Currency effects (cumulated) BC Group 10/11 11/12 12/13 13/14 14/15 10/11 11/12 12/13 13/14 14/15 CAPEX Net Working Capital CAGR +14.6% CAGR +14.6% 10/11 1
Slide 29: The way forward – CEO Antoine de Saint-Affrique
The way forward – CEO Antoine de Saint-Affrique November 2015
Slide 30: We have a clear and successful long-term strategy
We have a clear and successful long-term strategy “Heart and engine of the Vision chocolate and cocoa industry” Expansion Sustainable, 4 strategic Innovation profitable pillars growth Cost Leadership Sustainable Cocoa Page 30 November 2015 FY14/15 Roadshow presentation
Slide 31: Strategy unchanged, execution adjusted
Strategy unchanged, execution adjusted We are entering the next phase of our journey Focus on consistent, above market-growth and enhanced profitability: “SMART GROWTH” Sustainable growth Margin accretive growth Accelerated growth in Gourmet, Specialties and emerging markets Return on Capital and gr
Slide 32: Expansion: Accelerate Gourmet, Specialties and Emerging Markets
Expansion: Accelerate Gourmet, Specialties and Emerging Markets Further drive Further expand in Further leverage Gourmet & Specialties Emerging markets Outsourcing & strategic partnerships Page 32 November 2015 FY14/15 Roadshow presentation
Slide 33: Innovation: Margin accretive growth, value added products & services
Innovation: Margin accretive growth, value added products & services Products Channels Be ahead Added-value Added-value Be on trend of the curve products services Clean label, free Acticoa Decorations, Co-creation from Inclusions, fillings, Thermo-tolerant Innovative concepts 2 & 3 D printing Fermen
Slide 34: Cost Leadership: Returns from scale, leverage & operational excellence
Cost Leadership: Returns from scale, leverage & operational excellence Leverage our global scale Operational excellence Leverage our footprint Leverage our scale Continuous improvement Cocoa Leadership European shared service One + centre Finance Excellence Quality Culture Western Europe & EEMEA Cen
Slide 35: Sustainable Cocoa: innovation, implementation, impact
Sustainable Cocoa: innovation, implementation, impact Sustainable practices, prosperous communities, long term supply Leading sustainability Collaborating for impact Setting new benchmarks • A holistic approach • Pre-competitive platforms • Cocoa Horizons Foundation • Capability based • Customer par
Slide 36: Outlook
Outlook Strive for smart balance between consistent, above-market volume growth and enhanced profitability Mid-term guidance (until 2017/18) We will strike a balance between volume growth and enhanced profitability, as well as free cash flow generation: “smart growth” Average volume growth 4-6% EBIT
Slide 37: Appendix
Appendix November 2015
Slide 38: What makes Barry Callebaut unique?
What makes Barry Callebaut unique? Global number one player in chocolate and cocoa Deep chocolate and cocoa expertise Global leader in Gourmet Proven and long-term oriented strategy Unparalled global footprint, present in all key markets Preferred outsourcing and strategic partner Leader in Innovati
Slide 39: More than 50 factories provide manufacturing diversification and competitive advantage
More than 50 factories provide us with manufacturing diversification and unique competitive advantage Cocoa processing factory Chocolate factory Integrated factory New factories since 2014/15 Page 39 November 2015 FY14/15 Roadshow presentation
Slide 40: Barry Callebaut uniquely positioned in industrial chocolate and cocoa markets
Chocolate and Cocoa markets Barry Callebaut uniquely positioned in industrial chocolate and cocoa markets Cocoa grinding capacity Industrial chocolate – open market BC BC Cargill Cargill Olam Blommer Blommer Fuji Oil Mondelez Puratos Guan Chong Cémoi Ecom Cocoa Irca BT Cocoa Clasen Nestlé Kerry Grou
Slide 41: West Africa is the world's largest cocoa producer
West Africa is the world’s largest cocoa producer Total world harvest (14/15): 4,157 TMT others 8% About 70% of total cocoa beans Nigeria come from West Africa 5% Brazil* 6% BC processed ~925,000 tonnes or Ivory Coast* 22% of the world crop Cameroon* 42% 6% Barry Callebaut has various cocoa Ecuador
Slide 42: Capital Expenditures
Capital Expenditures* +4.5% +4.6% +4.2% +3.8% +4.0% CAPEX as % of sales revenue Average = 4.1% 249 249 218 224 200 174 Approved amount Additional growth IT Upgrade / efficiency gains existing sites Maintenance CAPEX 2010/11 2011/12 2012/13 2013/14 2014/15 2015/16 E *CAPEX as reflected in Cash Flow S
Slide 43: Available Financing
Available Financing Enough headroom for further growth and raw material price fluctuations As of 31 August 2015 CHF 4,021 mio. ABS CHF 791 mio Various uncommitted facilities -48.1% EUR 600 mio. Domestic Commercial Paper Programme 3-5 years CHF 2,086 mio. Various bilateral LT loans EUR 175 mio. Term
Slide 44: Liquidity – Debt maturity profile
Liquidity – Debt maturity profile As of 31 August 2015 In CHF mio Uncommitted lines Committed lines 150 645 --Cash and revolving 196 credit facility (undrawn) ■ Short-term facilities ■ Term loans 188 ■ Bonds 374 374 265 196 127 100 12 Cash 2015 2016 2017 2018 2019 2020 2021 2022 2023 Page 44 Novembe