Artisanal Spirits Company PLC · LSE:ART

Artisanal Spirits — Investor Presentation (July 2021)

31 slides from Artisanal Spirits's investor presentation, July 2021

  1. Slide 1: July 2021

    July 2021

  2. Slide 2: Important Notice

    Important Notice For the purpose of this disclaimer, the “Presentation” shall mean and include these slides, all comments made by the presenter(s) of the slides and any question and answer session or discussion related to it. This Presentation has not been approved by an authorised person in accorda

  3. Slide 3: Who we are and what we do

    Who we are and what we do ASC is the owner of the Scotch Malt Whisky Society (SMWS), the leading curator and provider of premium single cask Scotch malt whisky for sale primarily online to a discerning global membership. SMWS was established in 1983 and currently has a growing worldwide membership o

  4. Slide 4: Management team

    Management team An experienced team with a proven track record Mark Hunter David Ridley Andrew Dane Kai Ivalo Non-Executive Chair Managing Director Finance Director Spirits Director Page 4

  5. Slide 5: Executive Summary (1 of 2)

    Executive Summary (1 of 2) ASC is a distinctive, fast growth, premium spirits, direct to consumer online business The journey so far • ASC acquired SMWS in 2015 and has seen rapid business growth with: – Revenues almost doubling between FY16 and FY19 – International revenues growing to around 70% of

  6. Slide 6: Executive Summary (2 of 2)

    Executive Summary (2 of 2) ASC is a distinctive, fast growth, premium spirits, direct to consumer online business The future growth opportunity • Develop the membership base in major international growth markets • Enhance e-commerce route to market capabilities and digital content • Further improve

  7. Slide 7: Key Performance Indicators

    Key Performance Indicators Members Profit Growth Stock 28,000 £932 20% 26 Years Members(1) Lifetime Member Value(3) YTD Revenue Growth(5) Current Stock Cover(1) 9 Years 63% 29% £330m Avg. UK/Europe Tenure(1) Gross Margin(3,4) E-Commerce CAGR(6) Retail Value(1) £65 £9.5m 24% 95% UK CPA(2) Gross Profi

  8. Slide 8: H1-21 Trading Update

    H1-21 Trading Update Strong revenue growth Revenue Members £m H1-20 H1-21 Change % '000s Dec-20 Jun-21 Change % UK Online 1.3 1.7 0.4 28% UK 13.7 13.4 (0.2) (2%) UK Venues & Events 0.7 0.6 (0.1) (17%) International 14.6 15.3 0.6 4% International 4.6 5.7 1.1 24% Total 28.3 28.7 0.4 1% Total 6.6 7.9 1

  9. Slide 9: Business Model

    I7 Business: M OC .

  10. Slide 10: Premium Product

    Premium Product Curator of limited edition Scotch Malt Whisky and Other Spirits Variety - Hundreds of different single cask Scotch whiskies are sold each year, across twelve flavour profiles Exclusivity - Each product is a limited edition at cask strength with individual character, and average yield

  11. Slide 11: SMWS Value Creation Model

    SMWS Value Creation Model Creating substantial value throughout the chain Note: PB represents Partner Bars Page 11

  12. Slide 12: Value Creation through production

    Value Creation through production Generating value through ageing and curation Appreciating Asset – Buying younger spirit generates additional value over time Maturation and Flavour Development – Curation of the production process adds further value and creates an attractive variety of flavours for

  13. Slide 13: Online Metrics

    Online Metrics E-commerce led business with over 90% of sales through direct to consumer channels E-Commerce Revenue: Grown from 64% in 2018 to 86% in 2020 (accelerated by the impact of Covid on venues). Growing at around 30% p.a. E-Commerce KPIs: UK & Europe: Strong KPIs with better than average: –

  14. Slide 14: Membership and Lifetime Value Analysis

    Membership and Lifetime Value Analysis Strong, engaged and growing global membership Committed Members Member Development CAGR Strong post year-one member retention of 85% for UK members, Dec-18 Dec-19 Dec-20 2018-20 who have an average membership tenure of 9 years’ so far. UK Members 13,400 14,100

  15. Slide 15: Business Model: Growth drivers

    Business Model: Growth drivers A clear plan for revenue and EBITDA growth Grow and develop membership • Direct investment towards high growth markets • Build out existing channels and focus on digital recruitment initiatives • Further enhance the member value proposition and increase member retentio

  16. Slide 16: Market

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  17. Slide 17: The 'Premium +' Spirits Markets

    The ‘Premium +’ Spirits Markets Secular growth driven by increasing spending power Fundamental changes are causing secular growth within this Global Scotch Whisky Market Size industry: Consumers are driving premiumisation by seeking Segment £/bottle Market Size CAGR “authenticity and status, enabled

  18. Slide 18: $4.2 billion global addressable market

    $4.2 billion global addressable market SMWS is in all the key markets with huge opportunity to expand The global addressable market was USD4.2b1 in 2019 up by Global Addressable Market Analysis 202%2 (13% CAGR) vs 2010 Addressable Market SMWS 2019 2010-19 2020 Whisky Key Markets Alcohol E-commerce i

  19. Slide 19: Financials

    Financials

  20. Slide 20: ASC Group P&L

    ASC Group P&L Proven track record of growth ASC: Headline P&L Full Year (December Year End) Year to Date (Mar) 2018 2019 2020 2018-20 Q1-20 Q1-21 YTD £m Actual Actual Actual CAGR Actual Actual Change International 6.6 8.6 10.3 24% 1.8 2.5 39% UK E-Commerce 2.1 2.5 3.2 23% 0.5 0.8 56% UK Venues & Eve

  21. Slide 21: Stock & Supply

    Stock & Supply Strong investment is creating an inflection point Key points of note: 26 Years 14,000 • Stock Volume: Equivalent to 4.3m bottles or around 26x the 2020 bottle sales volumes Current Stock Cover(1) Casks(1) • Stock Variety: 14,000 potential new products • Stock Cover: Stock purchase mod

  22. Slide 22: ASC Group Balance Sheet & Cash Flow

    ASC Group Balance Sheet & Cash Flow Strong and well capitalised with positive operating cash flows ASC Consolidated BS ASC Summary Cash Flow £m Dec-19 Dec-20 £m FY19 FY20 Headlines Cask Goods 18.8 18.7 EBITDA 0.1 0.6 Cash & Bank Working Capital Movements: • Extensive asset base of unique whisky Cash

  23. Slide 23: Reasons for the IPO

    Reasons for the IPO Investment plans create significant opportunities for growth Use of funds: • Spirit & Stock Investment – Whisky & Other Spirits Stock & Wood – Sherry cask maturation programme • Membership & Business Growth – Membership Recruitment – Venues – Brand, Digital & Distribution Develop

  24. Slide 24: Key Points Summary

    Key Points Summary Today we are • A distinctive business with high barriers to entry • At an inflection point for accelerating growth The future growth opportunity • Develop the membership base in major international growth markets • Enhance e-commerce route to market capabilities and digital conten

  25. Slide 25: Questions

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  26. Slide 26: Appendices

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  27. Slide 27: Appendices

    Appendices 1) Glossary 2) Awards 3) Venues & Partner Bars 4) Non-Executive Board Page 27

  28. Slide 28: Glossary

    1) Glossary • A&P – Advertising & Promotional Costs • ASC – Artisanal Spirits Company • CAGR – Compound Annual Growth Rate • Cask Wood – an empty cask purchased for filling with spirit • Churn – the inverse of Retention (as defined below), i.e. the percentage of members who do not renew their member

  29. Slide 29: Awards

    2) Awards SMWS’s Scotch Malt Whisky and other spirits have won almost 200 awards from seven of the leading bodies in less than three years. SMWS venues have won multiple awards & recognition including being shortlisted for the 2019 Icons of Whisky “Bar Group of the Year” Page 29

  30. Slide 30: Venues & partner bars

    3) Venues & partner bars Direct to consumer – wherever they are Award Winning Venues: – Four UK venues (Glasgow, London, Leith & Queen Street – Edinburgh) – Multiple awards & recognition including being shortlisted for the 2019 Icons of Whisky “Bar Group of the Year”. Partner Bars: A network of over

  31. Slide 31: Non-executive board

    4) Non-executive board An experienced team with a proven track record Paul Skipworth Lesley Jackson Helen Page Gavin Hewitt, CMG Mark Bedingham NED & Deputy Chair NED & Audit Committee NED & Remuneration NED NED Chair Committee Chair ASC Chair 2015-21. Former CFO for Stock Chief Brand Officer for CE

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