Heineken Nv · EURONEXT:HEIA

Heineken Nv — Heineken Financial Markets Conference 2016

27 slides from Heineken Nv's conference presentation, May 11, 2016

  1. Slide 1: Winning in Vietnam!

    HEINEKEN FINANCIAL MARKETS CONFERENCE 2016 HO CHI MINH CITY, VIETNAM Conference Design Image Will Be Added Later Winning in Vietnam! Leo Evers Managing Director, Vietnam Brewery Ltd Ho Chi Minh City, Vietnam | May 11-12, 2016 | Heineken NV

  2. Slide 2: Agenda

    Agenda Winning in Vietnam!  Introduction to VBL  Vietnam Market Overview  VBL Strategy to Win  2015 Business Performance 1

  3. Slide 3: 25 years of excellence

    25 years of excellence 1991 1994 2007 2014-15 First brewery 1st Brew of Acquired Foster’s Accelerated JV in Vietnam Heineken® Beer Vietnam (Larue, Innovation BGI etc.) 2016 1993 1997 2008 2015 1st Brew of Introduction of Launched 1st Sustainability Tiger Beer 1st Local Brand Tiger Crystal Report in

  4. Slide 4: Vietnam is HEINEKEN's 2nd largest profit contributor

    Vietnam is HEINEKEN’s 2nd largest profit contributor HEINEKEN  Important contributor to both Asia Pacific region CONSOLIDATED OPERATING and group level at HEINEKEN: PROFIT (BEIA) (2015)  Just under 50% Asia Pacific region’s consolidated Vietnam 10% operating profit beia  10% HEINEKEN consolidated

  5. Slide 5: VBL at a glance

    VBL at a glance  Ownership: 60% 40%  4 Breweries  1,752 Employees Quang Nam Brewery Da Nang Brewery  Operating from Quang Binh to Ca Mau  # 2 Market Share in Vietnam Hoc Mon Brewery  Comprehensive portfolio of brands Tien Giang Brewery 4 Source: Company data

  6. Slide 6: Local management team structure

    Local management team structure Managing Director Leo Evers Deputy Finance Commercial Managing Director Director Director Tran Minh Triet Danny Chan Laurent Theodore  1,752 employees Supply Chain Human Resource  8 expats Director Director  7 nationalities Paul Bleijs Le Qui Don  Gender mix: 80%

  7. Slide 7: Portfolio strategy in action

    Portfolio strategy in action  Leading the development of premium and super premium segment led by Heineken®  Continuing to fuel the growth of Tiger across the Premium Index > 140 regions and within affordable premium  Consolidating position in mainstream in both core existing markets, and further

  8. Slide 8: Market share overview

    Market share overview >70% Total North 30% - 70%  Market is consolidated at Operation of <30% regional level APBHN  Habeco operates mainly in the North of Vietnam with leading market position North Central Coast Da Nang  VBL, Sabeco and Hue Brewery (Carlsberg) are the key players South Central Co

  9. Slide 9: Agenda

    Agenda Winning in Vietnam!  Introduction to VBL  Vietnam Market Overview  VBL Strategy to Win  2015 Business Performance 8

  10. Slide 10: Vietnam at a glance

    Vietnam at a glance Young & 91.7m 14th largest population in world Sizeable 49% Younger than 30 years Vietnam has a Ha Noi Population % urban population large young 34.3% Hai Phong population and 194 Billion USD GDP a fast growing Positive economy 2,109 GDP per capita (USD) Economic Underlying 6.68%

  11. Slide 11: Favourable demographics

    Favourable demographics YOUNG POPULATION RISING INCOME RAPID URBANISATION Population Changes 2013– 2015 Percentage of household Percentage of people living in urban areas 2015 37% 2013 34% 30% 27% MALE FEMALE 2007 2012 2017 2005 2010 2015 2020 Population below 30 years old is c.49% of Annual Income

  12. Slide 12: Positive underlying economic fundamentals

    Positive underlying economic fundamentals A growing economy VIETNAM GDP IMPROVING CONSUMER with inflation under GROWTH & INFLATION CONFIDENCE INDEX control Rising consumer 20% 18.6% confidence driven 18% by positive 16% 107 economic prospects 14% 103 101 12% 9.2% In 2016 GDP 9.2% 98 10% 97 growth is

  13. Slide 13: An attractive beer market

    An attractive beer market Beer is 94% of BEER IS THE PREFERRED total alcoholic ALCOHOLIC BEVERAGE THE BEER MARKET CONTINUES TO GROW consumption, and represents 31% share of Dairy CAGR +4.8% total beverage Drinks 14% market Alcoholic Drinks Beer 44 33% 94% CAGR +4.7% 42 Hot 40 Beverages 38 21% 36 33

  14. Slide 14: Market structure & consumer preference is changing

    Market structure & consumer preference is changing Home consumption OFF PREMISE CONSUMPTION AND PREMIUM SEGMENT is increasing in BECOMING MORE POPULAR INCREASING SHARE preference Premium showing 16% 19% OFF OFF OFF 21% fastest growth and 29% 31% 35% gaining importance 3.1%-5.5% (Abv) is the most pop

  15. Slide 15: Agenda

    Agenda Winning in Vietnam!  Introduction to VBL  Vietnam Market Overview  VBL Strategy to Win  2015 Business Performance 14

  16. Slide 16: Strategy to win

    Strategy to win To be the leading, proud and responsible brewer in Vietnam STRATEGIC PILLARS 1 Reignite Heineken®, continuing improvement 2 Build on strong Tiger momentum 3 Move to broad leadership with the portfolio, leveraging Larue 4 Excite the market with innovations, shaping the Cider category

  17. Slide 17: Reignite Heineken - continuing improvement

    Reignite Heineken ® - continuing improvement The premium TOTAL MARKET PREMIUM HEINEKEN® SHARE OF PREMIUM segment has the SEGMENT CONTRIBUTION (%) SEGMENT IN 2015 seen fastest growth and was c.21% of market VOLUME CAGR +12% Heineken in 2015 21% ® 19% 20% 18% 20% 16% Heineken® was 20% share of Heineke

  18. Slide 18: Reignite Heineken - continuing improvement

    Reignite Heineken - continuing improvement ® Heineken® development encouraging with positive volume growth in 2015 INFLECTION IN 2015 WHEN HEINEKEN® VOLUME INCREASED  Heineken® saw positive growth in 2015 with gradually improving brand attributes YOY +2%  Heineken® equity is amongst the highest in

  19. Slide 19: Building on strong Tiger momentum

    Building on strong Tiger momentum IMPRESSIVE VOLUME PERFORMANCE KEY DRIVERS OF SUCCESS  Successful positioning in affordable premium VOL. CAGR +36%  Successful leverage of UNCAGE platform increasing brand equity  Strengthening route to market and perfecting outlet execution  Healthy investment t

  20. Slide 20: Move to broad leadership with the portfolio, leveraging Larue

    Move to broad leadership with the portfolio, leveraging Larue Rural areas have a CONSOLIDATING MAINSTREAM TAPPING INTO HIGH POTENTIAL large population, STRATEGY IN CORE MARKETS RURAL MARKETS high FMCG value, and increasing spend on beer Continue to develop 66% 62% 52% & upgrade Larue core Of Vietnam

  21. Slide 21: Excite the market with innovation

    Excite the market with innovation AMBITION TO TRIPLE BRINGING MORE EXCITEMENT WITH INNOVATION RATE BY 2018 NEW PRODUCTS IN 2014-2015 Building the new Cider segment with game x3  Launched Strongbow in 4 variants in changer ambition late 2015 with game changer ambition  4 New Brands/Line Extensions

  22. Slide 22: Developing people and leveraging the strong talent pool

    Developing people and leveraging the strong talent pool  CULTURE Friendly and open working environment  A GREAT PLACE TO WORK People are one of our Positive climate survey result 2015 key assets and  Employment Engagement Index: 86% integral to our  Performance Enablement Index: 84% businesses s

  23. Slide 23: Improving efficiency across all functions

    Improving efficiency across all functions Focus on reducing cost everywhere Strong OPTIMISING PERFORMANCE FIXED COSTS AS % OF CONTINUED FOCUS ON achievements to ACROSS FUNCTIONS REVENUE COST EFFICIENCIES date and ambitious targets over the Supply Consumer Accumulated saving next three years Chain Va

  24. Slide 24: Sustainability – Brew a Better Vietnam

    Sustainability – Brew a Better Vietnam Part of HEINEKEN Global strategy “Brewing a Better World” – 6 Focus areas PROTECTING REDUCING SOURCING WATER RESOURCES CO2 EMISSIONS SUSTAINABLY ADVOCATING PROMOTING GROWING WITH RESPONSIBLE HEALTH & SAFETY COMMUNITIES CONSUMPTION 23 Source: Company Data

  25. Slide 25: Agenda

    Agenda Winning in Vietnam!  Introduction to VBL  Vietnam Market Overview  VBL Strategy to Win  2015 Business Performance 24

  26. Slide 26: Continuing to deliver impressive returns

    Continuing to deliver impressive returns Strong underlying REVENUE OPERATING PROFIT OPERATING PROFIT financial 2012-2015 (BEIA) 2012-2015 MARGIN (BEIA) 2012-2015 performance driving impressive margin expansion CAGR +14% CAGR +17% +400 BPS Continued expansion in 2015 2012 2015 2012 2015 2012 2015 1.

  27. Slide 27: Summary

    Summary Winning in Vietnam!  Positive economic outlook combined with favourable demographics should underpin future growth  Clear strategy in place to drive further share gain and outperformance  Portfolio strategy is working. Heineken® volume trends improving and clear brand strategy in place. E

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