Barry Callebaut AG · SIX:BARN
Barry Callebaut — Q1 2015/16 Earnings Presentation
34 slides from Barry Callebaut's earnings presentation, January 2016
Slide 1: Roadshow Presentation – Q1 2015/16
Roadshow Presentation – Q1 2015/16 January 2016 January 2016
Slide 2: Agenda
Agenda Barry Callebaut at a glance Highlights Q1 2015/16 The way forward Page 2 January 2016 Q1 2015/16 Roadshow presentation
Slide 3: At a glance
At a glance January 2016
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 January 2016 Q1 2015/16 Roadshow presentation
Slide 5: Page 5 January 2016 Q1 2015/16 Roadshow presentation
Page 5 January 2016 Q1 2015/16 Roadshow presentation
Slide 6: Our Regional and Product split
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 January 2016 Q1 2015/16 Roadshow presentation
Slide 7: Highlights Q1 2015/16
Highlights Q1 2015/16 January 2016
Slide 8: Strong start to 2015/16
Q1 Key sales figures 2015/16 Strong start to 2015/16 Strong start to the year Sales volume up +6.4%; sales revenue up +13.3% in local currencies, +3.8% in CHF Broad-based growth across regions, and positive contributions from all key growth drivers Focus on the implementation of the “smart growth” s
Slide 9: Broad-based volume growth across regions
Q1 Key sales figures 2015/16 Broad-based volume growth across regions Europe Americas Asia Pacific Global Cocoa 4% 4% 28% 28% 42% 26% 25% yoy growth Volume +7.1% +13.2% +13.9% -2.0% Revenue in CHF -1.6% +10.6% +7.8% +6.1% Revenue +11.0% +9.0% +11.6% -20.0% In local curr. Page 9 January 2016 Q1 2015/
Slide 10: Absolute growth driven by main Regions, outperforming the market
Q1 Key sales figures 2015/16 Absolute growth driven by main Regions, outperforming the market (tonnes) +6.4% +13.9% -2.0% +13.2% 15,208 -2’530 15'300 +7.1% 14'537 494’873 465’046 Group Volume Region Europe Region Americas Region Asia Pacific Global Cocoa Group Volume FY 2014/15 FY 2015/16 Market Vol
Slide 11: Strong positive contribution from all our key growth drivers
Q1 Key sales figures 2015/16 Strong positive contribution from all our key growth drivers Emerging Markets Long-term outsourcing & Gourmet & Specialties Strategic Partnerships Volume growth +14.3% vs prior year +12.3% vs prior year +5.2% vs prior year Q1 2015/16 10% 34% 31% % of total Group Sales Vo
Slide 12: Challenging cocoa market environment continues
Cocoa processing profitability Challenging cocoa market environment continues European combined ratio - 6 months forward ratio Q1 2015/16 4.00 3.00 Combined ratio 2.85 Butter ratio 2.00 1.00 Powder ratio 0.00 Oct-07 Oct-08 Oct-09 Oct-10 Oct-11 Oct-12 Oct-13 Oct-14 Oct-15 For cocoa processors, profit
Slide 13: Good progress achieved in the different streams
Cocoa Leadership Project Good progress achieved in the different streams Commercial leadership Centralized global steering Operations & Supply Chain leadership SKU reduction on going, Centralized combined Closed down cocoa factory therefore less complexity cocoa ratio management in Thailand and more
Slide 14: 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 Q1 vs. prior year 300% 250% Cocoa beans +12% 200% Sugar 150% world +4% 100% Sugar EU -20% 50% Milk powder -11% 0% Sep.07 Jun.08 Mrz.09 Dez.09 Sep.10 Jun.11 Mrz.12 Dez.12 Sep.13 Jun.14 Mrz.1
Slide 15: 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 16: 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 17: The way forward
[BARRY (()) CALLEBAUT] The way forward
Slide 18: 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 18 January 2016 Q1 2015/16 Roadshow presentation
Slide 19: 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 20: 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 20 January 2016 Q1 2015/16 Roadshow presentation
Slide 21: 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 22: 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 23: 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 24: Strive for smart balance between consistent, above-market volume growth and enhanced profitability
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 25: Appendix
[BARRY (()) CALLEBAUT] Appendix Follow your heart's desire The first cocoa drink you'll love with all your heart WwWw.acticoa.com BARRY {J CALLEBAUT|
Slide 26: 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 27: Deleveraging of the company and improvement of key financial ratios remain a high priority
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 28: 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 29: More than 50 factories provide us with manufacturing diversification and unique 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 29 January 2016 Q1 2015/16 Roadshow presentation
Slide 30: 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 31: 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 32: 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 33: Enough headroom for further growth and raw material price fluctuations
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 34: 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 34 January