Barry Callebaut AG · SIX:BARN
Barry Callebaut — 9M 2009/10 Earnings Presentation
29 slides from Barry Callebaut's earnings presentation, July 2010
Slide 1: 9-month key sales figures 2009/10
Barry Callebaut 9-month key sales figures 2009/10 July 2010 July 2010 Barry Callebaut - Roadshow presentation
Slide 2: Agenda
Agenda X Barry Callebaut at a glance X Highlights 9 months 2009-2010 X Outlook July 2010 Barry Callebaut - Roadshow presentation 2
Slide 3: Active along the entire cocoa and chocolate value chain
Barry Callebaut is active along the entire cocoa and chocolate value chain Cocoa Semi-finished Products Chocolate Products Sugar 100% Retail Milk customers Other Consumer Products Liquor for Chocolate via Industrial Shells/ chocolate Couverture customers waste ~50% Butter Artisanal 100% customers 20
Slide 4: Barry Callebaut at a glance
Barry Callebaut at a glance FY 2008/09 X World leader in high-quality cocoa and chocolate Net revenue: CHF 4.9 bn products and outsourcing partner of choice, with over 40% share in the open industrial chocolate market Consumer Cocoa X World’s largest supplier of Gourmet & Products 17% 11 %15% Specia
Slide 5: Cocoa, dairy, and sugar are the most important raw materials we source
Cocoa, dairy, and sugar are the most important raw materials we source Barry Callebaut business model 100g 100gchocolate chocolatetablet tabletcontains: contains: Gourmet & Milk Milk Dark Dark Consumer 20% Cocoa price lists Products Cocoaliquor liquor 11g 11g 44g 44g regular Cocoa Cocoabutter butter
Slide 6: West Africa is the world's largest cocoa producer – BC sources locally
West Africa is the world’s largest cocoa producer – BC sources locally Total world harvest (08/09): 3 456 k MT Others Dominican Republic 1% 9% X BC sources ~540k MT/y (08/09) cocoa, thereof 65% directly from Papa New Guinea 2% farmers, cooperatives & local trade Ivory Coast* houses Indonesia /Malays
Slide 7: Staying focused on Food Manufacturers, increasing the emphasis on Gourmet
Confirmed growth strategy Staying focused on Food Manufacturers, increasing the emphasis on Gourmet X “Heart X “Heart and and engine engine of of the the chocolate chocolate industry” industry” Vision X Chocolate X Chocolate expert expert and and business business partner partner of of choice choice
Slide 8: Growth comes from new regions & outsourcing deals
Geographic expansion Growth comes from new regions & outsourcing deals Barry Callebaut share in sales volumes in % of total 100% 11% 12% 14% 14% 16% 17% 90% 2% 6% 80% 9% 10% 70% 60% New markets (EE, Latin America, AP) 50% 89% Long Term 88% 85% Outsourcing 40% 80% 76% 74% contracts Established 30% ma
Slide 9: BC focuses on major food trends…
Innovation: BC focuses on major food trends… Health Experience X Organic X Origins X Polyphenols X Fair trade X Anti-aging X Chili, honey X Memory X High cocoa content X Heart and veins X Less sugar X Less fat and still natural X Mycryo Convenience X Food on-the-go X Snacking Ethics X Higher melting
Slide 10: Factory costs on per tonne activity down by 5%
Cost leadership Factory costs on per tonne activity down by 5%* Liquid Chocolate Capacity MT 79.4% 82.5% 81.2% 89.1% 1'000'000 1'000'000 500'000 500'000 0 0 2006/07 2007/08 2008/09 2009/10 E Origin Countries Europe Americas Asia Utilization X Capacity utilization for liquid chocolate: up from 79.4%
Slide 11: Three main growth drivers support our strategy
Three main growth drivers support our strategy • The Professional segment is a very Gourmet fragmented … market to be further developed. Currently only 13% of BC‘s business. • Chocolate players currently outsource Outsourcing 10-12% of their total … … production, with high potential to be increased
Slide 12: The preferred solutions provider for chocolate professionals
Barry Callebaut’s Gourmet & Specialties business: The preferred solutions provider for chocolate professionals Picture 1 to be added: our Picture 2 to be added: our products customers X >200 chocolates used as X 100,000+ premium artisan users ingredient by professionals X >30,000 bakeries and pastry
Slide 13: Additional market outsourcing potential between 250,000 and 500,000 tonnes
Outsourcing Additional market outsourcing potential between 250,000 and 500,000 tonnes X Global industrial chocolate Top 10 Manufacturers of Industrial Chocolate (in '000 tonnes) production estimated at 5.5 million tonnes pa. Barry Callebaut X Top five players account for Kraft / Cadbury about half
Slide 14: Rationale for chocolate players to outsource
Outsourcing Rationale for chocolate players to outsource X Take out complexity of their own production X Cost leadership in the chocolate production X Access to new technologies X Access to innovative processes /products /research X Quality management and highly flexible production X Focus resources
Slide 15: Benefit from strong presence in mature markets, untapped opportunities in emerging markets
Market Benefit from strong presence in mature markets but untapping opportunities in emerging markets Global Chocolate Market 6.0 Western Europe North America Australasia Gourmet 5.0 Consumption per capita (kg) 4.0 Eastern Europe 3.0 2.0 Latin America 1.0 Middle East and Asia Africa Pacific ‐ ‐1.0%
Slide 16: Agenda
Agenda X Barry Callebaut at a glance X Highlights 9 months 2009-2010 X Outlook July 2010 Barry Callebaut - Roadshow presentation 16
Slide 17: Highlights first nine months
Highlights first nine months X In the third quarter sales volumes further accelerated supported by all regions, while world chocolate confectionery market was flat in volume terms X Growth supported by geographic expansion, increased focus in Gourmet, implementation of outsourcing volumes and market
Slide 18: The world chocolate confectionery market showed flat growth
Global Market Environment The world chocolate confectionery market showed a flat growth in the last 9 months Global Chocolate confectionery – top 15 countries – YTD +0.15% YTD 08/09 YTD 09/10 2,458,878 2,455,376 +2.4% Volume in tons 1,061,513 +0.9% 1,037,137 783,882 776,659 -6.1% 522,082 490,415 +2.
Slide 19: Cocoa prices at the highest level since 33 years, slowly easing
Raw material price development Cocoa prices at the highest level since 33 years, slowly easing, other raw materials volatile London Cocoa 2nd Position – Daily high/ low close, £/tonne Av. Price for white sugar (communicated by EU sugar producers & refiners) 2500 EU ref. Price White london n°5 (2nd p
Slide 20: Combined ratio unpredictable and volatile
Raw material price development Combined ratio unpredictable and volatile Cocoa powder-butter combined ratio* – European ratios 6 months forward against LIFFE EU powder EU butter Combined ratio 4.50 4.00 3.50 Butter - Powder - Combined 3.00 2.94 June 11 2.50 2.00 1.50 1.00 0.50 May-03 May-01 May-02 M
Slide 21: Volume growth further accelerated and all regions contributed
Volumes – 9 month Volume growth further accelerated and all regions contributed to growth Sales volume in ‘000 Metric tonnes X Sales volumes up 8.9% in a flat chocolate market and coming from a positive Change 9 months 9 months growth base in % 09/10 08/09 X BC in Europe maintained its Group +8.9% 9
Slide 22: Global Sourcing & Cocoa: strong demand of cocoa powder
Global Sourcing & Cocoa Strong demand of cocoa powder in the last months Revenue split 9 months 09/10 X Sharp increase in North America and South America Asia/RoW Global sales (+11.5%) due to higher demand of cocoa powder Sourcing & Americas 4% Cocoa X Sales in Europe remained stable in the first 9
Slide 23: Region Europe: maintained growth momentum in a flat market
Region Europe Maintained growth momentum in a flat market Regional revenue split 9 months 09/10 X Continuous growth in Food Manufacturers and Asia/RoW Global Gourmet 4% Sourcing & Western Europe and Eastern Europe showed a Americas Cocoa X 19% 18% strong third quarter, in most of the countries, with
Slide 24: Region Americas: good performance of corporate accounts
Region Americas Good performance of corporate accounts and implementation of outsourcing volumes Regional revenue split 9 months 09/10 Global Sourcing & X Sales volume reached a positive double digit growth Asia/RoW 4% Cocoa due to the good performance of key customers as Am ericas 19% 18% well as t
Slide 25: Region Asia/Rest of World: increased volumes
Region Asia/Rest of World Increased volumes, high demand in Gourmet & Specialties Regional revenue split 9 months 09/10 Asia/RoW X Food Manufacturers growth driven by geographical 4% expansion: Korea, Australia, Japan, Thailand, Malaysia. Global Americas Sourcing & X Further phased in outsourcing vo
Slide 26: Agenda
Agenda X Barry Callebaut at a glance X Highlights 9 months 2009-2010 X Outlook July 2010 Barry Callebaut - Roadshow presentation 26
Slide 27: Financial targets for 3-year period 2009/10-2011/12
Outlook: Financial targets for 3-year period 2009/10-2011/12 X Annual growth targets on average* for 2009/10 through 2011/12: X Volumes: 6-8% X EBIT: at least in line with volume growth *Our view for the 2009-2012 period reflects current economic forecasts for the markets we operate in as well as in
Slide 28: Summary
Summary Further acceleration in volume growth Contribution from all regions and all product groups Emerging markets developing very well Excellent growth in high-margin Gourmet & Specialties business Three-year financial targets confirmed July 2010 Barry Callebaut - Roadshow presentation 28
Slide 29: Cautionary note
Cautionary note Certain statements in this Letter to Investors regarding the business of Barry Callebaut are of a forward looking nature and are therefore based on management’s current assumptions about future developments. Such forward-looking statements are intended to be identified by words such