Carlsberg As Class A · OMXCOP:CARL_A
Carlsberg As Class A — Q2 2002 Earnings Presentation
36 slides from Carlsberg As Class A's earnings presentation, Aug 8, 2002
Slide 1: The Carlsberg Group Q2 2002
The The Carlsberg Group Carlsberg Group Q2:2002 Q1 2002 Udkast8 af 05-02-2002 August 2002 1
Slide 2: Highlights
The Carlsberg Group Highlights • EBITA improved by DKK 455 million (+34%) • Continued growth in all regions in Q2 • Carlsberg brand growth 7% in Q2 (YTD growth 6%) • Continued profitable growth in BBH • Improved free cash flow • Negative currency impact • Continued participation in brewery consolida
Slide 3: Key Figures - P/L
The Carlsberg Group Key Figures - P/L DKK million Carlsberg Group Carlsberg Breweries 2001 1 Jan - 30 Jun 1 Jan - 30 Jun Exceptional 2002 2001 (*) 2002 2001 (*) items (**) 6 months 6 months Change % 6 months 6 months Change % Net revenue 17,523 16,241 8 17,523 16,241 8 Operating profit 1,806 1,351 3
Slide 4: Key Figures - Balance sheet
The Carlsberg Group Key Figures - Balance sheet DKK million Carlsberg Group Carlsberg Breweries 30.06.2002 31.12.2001 Change % 30.06.2002 31.12.2001 Change % Non-current assets 31,345 31,171 1 29,870 29,741 0 Current assets 16,573 16,284 2 15,733 15,036 5 Capital and reserves 17,911 19,158 (7) 13,43
Slide 5: Key Figures - Cash flow
The Carlsberg Group Key Figures - Cash flow DKK million 1 Apr - 30 Jun 1 Jan - 30 Jun 2002 2002 Cash flow operations 3,030 3,419 Investments (885) (1,836) Free cash flow 2,145 1,583 Financing 1,119 (1,672) Total cash flow 1,026 (89) 5
Slide 6: Carlsberg Breweries A/S Q2 2002
The Carlsberg Carlsberg Group Breweries A/S Q1 Q2:2002 2002 2001 Udkast af 05-02-2002 8 August 2002 6
Slide 7: Highlights
Carlsberg Breweries A/S Highlights • Continued growth in all regions in Q2 – EBITA +13% (YTD +30%) – Volume growth 22% (YTD 22%); organic growth 17% (YTD 16%) • Carlsberg Brand growth 7% in Q2 (YTD growth 6%) – Increased investments in brand building activities • Continued profitable growth in BBH •
Slide 8: Income Statement
Carlsberg Breweries A/S Income Statement 1 Apr - 30 Jun 1 Jan - 30 Jun DKK million 2002 2001 Change 2002 2001 Change Net sales 9,951 9,272 +7 % 17,523 16,241 +8 % EBITA 1,335 1,180 +13 % 1,689 1,301 +30 % EBITA-margin 13.4 % 12.7 % 0.7%-p 9.6 % 8.0 % 1.6%-p 8
Slide 9: Negative income effects as a result of changes in exchange rates
Carlsberg Breweries A/S Negative income effects - as a result of changes in exchange rates • Substantial effects YTD, but primarily in Q2: • Translation effects EBITA: – RUR depreciation -37 DKK million • Financial losses – Russia -47 DKK million – Turkey -36 DKK million • Deferred tax – Russia -96
Slide 10: Strong focus on capital and cash generation
Carlsberg Breweries A/S Strong focus on capital and cash generation • Improved free cash flow Q2 YTD DKK million 2002 2001 2002 2001 Free cash flow 1,413 (926) 728 (1.881) • Improvement programs – Phase 1: Focus on reducing working capital Q2 Q2 YTD DKK million Working capital (930) (571) – Potentia
Slide 11: Change in volume
Carlsberg Breweries A/S Change in volume 1 Apr - 30 Jun 1 Jan - 30 Jun Million hl 2002 2001 2002 2001 Beer Western Europe 7.4 7.1 3% 12.9 12.6 3% Central and Eastern Europe 10.6 8.2 31 % 18.1 13.2 37 % Carlsberg Asia* 3.8 2.6 49 % 6.9 5.4 27 % Total 21.8 17.9 22 % 37.9 31.2 22 % Soft drinks, water a
Slide 12: Northern and Western Europe
Carlsberg Breweries A/S Northern and Western Europe 1 Apr - 30 Jun 1 Jan - 30 Jun DKK million 2002 2001 Change 2002 2001 Change Net sales 7,379 7,061 +5 % 13,017 12,293 +6 % EBITA 848 812 +4 % 987 844 +17 % EBITA-margin 11.5 % 11.5 % 0.0 %-p 7.6 % 6.9 % 0.7 %-p Volume (million hl beer) 7.4 7.1 3% 12
Slide 13: UK
Carlsberg Breweries A/S UK • Total market growth +1.7% RTM June • Shift in consumption from On Trade to Off Trade • Carlsberg-Tetley gaining market shares – Total Market Share YTD 12.4% (+0.4%) • Strong growth for main brands – Carlsberg Export volume growth +19% (YTD) – Carlsberg Lager volume growt
Slide 14: Nordic area - positive development
Carlsberg Breweries A/S Nordic area - positive development • Norway and Finland - increased market share and profit growth – Innovation – Distribution – Cost reduction • Denmark - increased profits – Strengthened market shares for key brands – Sales growth – New products – Synergies – Competition fr
Slide 15: Nordic area - positive development
Carlsberg Breweries A/S Nordic area - positive development • Sweden – Market shares for continuing brands positive YTD • Carlsberg +17% • Tuborg +15% – Signs of improvement in production, but costs still too high • Production consolidation completed • Line efficiency too low • Distribution costs too
Slide 16: Central and Eastern Europe
Carlsberg Breweries A/S Central and Eastern Europe 1 Apr - 30 Jun 1 Jan - 30 Jun DKK million 2002 2001 Change 2002 2001 Change Net sales 2,230 1,553 +44 % 3,823 2,468 +55 % EBITA 477 372 +28 % 652 492 +33 % EBITA-margin 21.4 % 24.0 % -2.6 %-p 17.1 % 19.9 % -2.9 %-p Volume (mill. hl of beer) 10.6 8.2
Slide 17: Central and Eastern Europe - Key issues
Carlsberg Breweries A/S Central and Eastern Europe - Key issues • New initiatives in Croatia and Bulgaria – Acquired majority ownership in Panonska, consolidated as from June – Acquired majority ownership in the Bulgarian breweries Shumensko and Pirinsko • Continued expansion in BBH - new breweries
Slide 18: BBH - Baltic Beverages Holding
Carlsberg Breweries A/S BBH - Baltic Beverages Holding 1 Apr - 30 Jun 1 Jan - 30 Jun DKK million 2002 2001 Change 2002 2001 Change Net sales (50%) 1,434 985 +46 % 2,383 1,546 +54 % EBITA (50%) 407 288 +41 % 627 397 +58 % EBITA-margin 28.4 % 29.3 % -0.9 %-p 26.3 % 25.7 % 0.6 %-p Volume (million hl be
Slide 19: BBH - Market trends beer first six months
Carlsberg Breweries A/S BBH - Market trends beer first six months Baltic Beverages Holding Market Volume Market Change Litres per growth growth share from capita 2002 2002-2001 2002 2001 Year 2001 Russia* 16 % 40 % 33 % 5.6 %-p 41 Ukraine 19 % 43 % 21 % 3.4 %-p 25 Baltic States** 18 % 28 % 45 % 3.5
Slide 20: Beer market in Russia
Carlsberg Breweries A/S Beer market in Russia Market shares in Market growth and Russia BBH volume growth (%) 1 Jan - 30 Jun Brewery 2002 2001 44 BBH 33.3 % 27.7 % 42 37 Sun Interbrew 11.3 % 13.0 % 33 34 Ochakova 8.6 % 8.7 % 27 25 26 25 25 23 21 Krasny Vostok 7.2 % 7.2 % 18 14 Bravo 4.0 % 3.6 % 12 1
Slide 21: Carlsberg Asia
Carlsberg Breweries A/S Carlsberg Asia 1 Apr - 30 Jun 1 Jan - 30 Jun DKK million 2002 2001* Change 2002 2001 Change Net sales 233 453 -49% 556 983 -43% EBITA 104 78 33% 241 169 43% EBITA-margin 44.6 % 17.2 % 27.4%-p 43.3 % 17.2 % 26.2%-p EBITA-margin excl. Hite 43.3 % 37.2 % Volume beer million HL 3
Slide 22: Carlsberg Breweries – going forward
Carlsberg Breweries A/S Carlsberg Breweries – going forward • Maintained expectations for EBITA growth in 2002 - approximately 20% • Maintain strong focus on cash flow and reduce capital employed further • Continue to improve operational performance – Maintain positive development in Poland and Swit
Slide 23: Carlsberg Group A/S Q2 2002
The Carlsberg Carlsberg Group A/S Q1 Q2:2002 2002 2001 Udkast af 05-02-2002 8 August 2002 23
Slide 24: Expectations 2002
The Carlsberg Group Expectations 2002 • Unchanged expectations to 2002 • EBITA: – Growth in total approx. 15% – Growth in Carlsberg Breweries approx. 20% • Net profit and EPS: – Excluding net effects in 2001 from special items and sale of Thai shares, growth in total approx. 10% 24
Slide 25: The Carlsberg Group
The Carlsberg Group Q1 2002 Udkast af 05-02-2002 25
Slide 26: Enclosures
Enclosures 26
Slide 27: Acquisitions in 2002
Carlsberg Breweries A/S Acquisitions in 2002 • Q1 – Carlsberg Asia’s ownership in Hite Brewery (South Korea) increased to 25% – Ownership in Carlsberg Italy increased to 100% – BBH acquisition of 70% of Voronezh – Carlsberg Asia acquisition of 25% of Lao Brewery (Laos) • Q2 – Increased shareholding
Slide 28: Further expansion for BBH in Eastern Europe
Carlsberg Breweries A/S Further expansion for BBH in Eastern Europe • Continuously increasing capacity in existing breweries • Acquisitions – Voronezh, southern Russia acquisition (70%) • Capacity 0.7 million hl • Consolidated as of June 2002 – Acquisition of 50% of Vena approved • New breweries – S
Slide 29: BBH - coverage of main population centres in Russia
Carlsberg Breweries A/S BBH - coverage of main population centres in Russia ~ 8,5 m people ~ 15 m people Baltika Vena St. Petersburg ~ 35 m people Yarpivo N.Novgorod Moscow Perm Rostov-na-Donu Tula ~ 20 m people Kazan Voronezh Samara Ekaterinburg Ufa Zolotoy Ural Baltika- Volgograd Chelyabinsk Don K
Slide 30: BBH aggregate sales volume
Carlsberg Breweries A/S BBH aggregate sales volume (million L) 2 500 2 ,3 8 4 2 000 1 ,8 2 9 Russia 1 500 80% 1 ,2 7 8 Ukraine 1 000 B B H w as 913 e s ta b lis h e d Baltics 618 500 318 11% 202 151 75 33 9% 14 0 91 92 93 94 95 96 97 98 99 2000 2001 Year 1996 1997 1998 1999 2000 Increase from previo
Slide 31: BBH - Ownership structure
Carlsberg Breweries A/S BBH - Ownership structure Carlsberg CarlsbergBreweries Breweries Hartwall HartwallPlc Plc 50% 50% BBH BBHAB AB THE THEBALTIC BALTICSTATES STATES RUSSIA RUSSIA UKRAINE UKRAINE Estonia: Saku (75%) Baltika (74%) Slavutich (85%) Latvia: Aldaris (75%) •Baltika-Don Lvivska Pivovarn
Slide 32: BBH - beer segmentation in Russia
Carlsberg Breweries A/S BBH - beer segmentation in Russia Super premium beer, licence produced and imports Carlsberg 1% Tuborg SAB High quality domestic Vena premium beer Efes Bravo 12% Baltika St. Razin High-quality domestic Zolotoy Ural Pikra main stream beer Yarpivo Ochakova 59% Medovoe Arsenolno
Slide 33: BBH - malthouses
Carlsberg Breweries A/S BBH - malthouses Country Malthouse Owner Capacity (tonnes/year) Lithuania Litmalt Lahden Polttimo 50% 10,000 Utenos Alus 50% Russia Yarpivo Yarpivo 15,000 Baltika Soufflet 70% 105,000 Baltika 30% Zolotoy Ural Zolotoy Ural 12,000 Ukraine Slavuta Malt BBH 82 % 90,000 House Tota
Slide 34: BBH - success factors
Carlsberg Breweries A/S BBH - success factors • Acquire majority interests in locally dominant breweries through new issues of equity – Local brands, management and ownership – Collector of beer tax • Quality improvements – Beer of western quality using modern technology – Extensive personnel develo
Slide 35: Accounting method in Russia/Ukraine
Carlsberg Breweries A/S Accounting method in Russia/Ukraine • Using monetary-non-monetary method due to historically high inflation • Positive economic trend in Russia/Ukraine – Lower inflation means that BBH is reviewing its accounting method • Likely to change at latest January 2003 to current met
Slide 36: The Carlsberg Group
The Carlsberg Group Q1 2002 Udkast af 05-02-2002 36