Slide 1: Purcari Wineries Plc 1H 2019 results presentation
Purcari Wineries Plc 1H 2019 results presentation August 16, 2019 Page 1
Slide 2: Disclaimer
Disclaimer THIS PRESENTATION IS MADE AVAILABLE ON THIS WEBSITE BY PURCARI WINERIES PUBLIC COMPANY LIMITED (the Company) AND IS FOR INFORMATION PURPOSES ONLY. This presentation and its contents do not, and are not intended to, constitute or form part of, and should not be construed as, constituting o
Slide 3: Today's Presenters
TODAY’S PRESENTERS Victor Bostan Victor Arapan Eugen Comendant Diana Durnescu Vasile Tofan CEO, Founder CFO COO IR Manager Chairman ▪ Founded the Group in ▪ 20 years of experience in ▪ Over 10 years of ▪ Over 5 years of ▪ Over 10 years 2002 banking, audit, corporate management experience experience
Slide 4: Agenda
AGENDA Our newest launch, 1 Our Group Traminer de Purcari, with an unmistakable aroma of rose petals confiture. Already 2 1H 2019 Operational Results scoring 4.4 on Vivino, ranking top 1% wines globally. 3 Update on 2019 Outlook 4 Q&A Page 4
Slide 5: Purcari Wineries at a glance
1 Purcari Wineries at a glance Leading wine player in Romania and the CEE... … with a strong & expanding regional footprint Geographical breakdown of sales in value terms, 1H 2019, % Founded in 1827 by French colonists, Purcari group is now... RO MD PL CH CZ+SK UA Other awarded CEE winery of the yea
Slide 6: Our Group: competitive advantage in an attractive market
1 Our Group: competitive advantage in an attractive market Attractive Secular shift from Competitive #1 premium wine beer, spirits to brand in market wine, especially advantage Romania in CEE Wine growth ’16- Plenty to catch up: #1 fastest growing #1 most awarded ’20F in Romania wine consumption lar
Slide 7: Our business model: Affordable Luxury
1 Our business model: Affordable Luxury Modern, cost-competitive Purcari is positioned at the winemaking intersections of three themes: ▪ Modern winemaking: the company is brand-, as opposed to appellation-centric and runs a cost-efficient business ▪ Affordable luxury: as an aspirational brand, Purc
Slide 8: Our mission, vision and values
1 Our mission, vision and values Our mission Our values To bring joy in people’s lives, by Hungry offering them high quality, inspiring, We win in the marketplace because we want it more ethical wines and excellent value for Ethical money. Always do the right thing and the money will follow Thrifty
Slide 9: Strong track record of growth
1 Strong track record of growth Revenues EBITDA1 Net Income RON m RON m RON m +27% +44% +18% 168 55 42 +29% 142 44 29 107 37 23 71 60 18 9 neg 0 2014 2015 2016 2017 2018 2014 2015 2016 2017 2018 2014 2015 2016 2017 2018 Note: (1) EBITDA normalized for non-recurring, IPO-related expenses incurred in
Slide 10: Vision: be the consolidator of a fragmented market
1 Vision: be the consolidator of a fragmented market Volume share top-3 players by country, % 79 77 82 74 #3 67 63 68 #2 41 39* 36 18 #1 10 Beer Spirits Wine Beer Spirits Wine Beer Spirits Wine Beer Spirits Wine Unlike beer or spirits, wine market remains very fragmented; players who have the scale
Slide 11: Topping competition at engagement, quality
1 Topping competition at engagement, quality Aspirational brand which consumers like sharing about Highest number of ratings and highest scores on Vivino Number of #brand uses on Instagram, by key Romanian brands X axis – number of Vivino ratings; Y axis – average Vivino score 9,804 4.1 4.0 3.9 3.8
Slide 12: Quality highly commended, remain the most awarded winery in CEE
1 Quality highly commended, remain the most awarded winery in CEE Leading medal-winning winery in CEE at Decanter, Increasing number of medals won from year to year the Wine ”Olympics” # of Decanter medals in 2015 - 19(1) # of medals #1 Concours Mondial de Bruxelles 58 50 50 Challenge International
Slide 13: Clear #1 in premium in Romania, keep gaining share, ample headroom
1 Clear #1 in premium in Romania, keep gaining share, ample headroom Overall, Purcari has tripled MS in 4 years…. …while becoming a clear #1 in Premium1 Value share of TOTAL retail market, Romania, % Value share of Premium (RON 30+/liter) retail market, Romania, % 18 24 Purcari (Brand) Samburesti 22
Slide 14: Agenda
AGENDA Negru de Purcari 2013, 4.4 score on 1 Our Group Vivino, top 1% wine globally 2 1H 2019 Operational Results 3 Update on 2019 Outlook 4 Q&A Page 14
Slide 15: Growing above guidance in 1H19
2 Growing above guidance in 1H19 Revenues Adjusted EBITDA Adjusted Net Income RON m RON m RON m Un-adjusted 1H18 EBITDA is RON 22.2m, Un-adjusted 1H18 Net Income is RON +25% given IPO related expenses, implying 35% 16.0m, RON 17.1m in 1H19, implying 7% 87.8 growth YoY. growth YoY. Normalizations mad
Slide 16: Highlights: strong growth, profitability increasing ahead of revenue
2 Highlights: strong growth, profitability increasing ahead of revenue • Accelerating growth, sales increasing +25% YoY in 1H19, to RON 88m (vs. +19% YoY in 1H18) Strong revenue • Poland contributing most to the growth, increasing 47% YoY, on improved Bostavan performance growth • Encouraging perfor
Slide 17: Markets: Romania remains key growth driver, record quarter in Poland
2 Markets: Romania remains key growth driver, record quarter in Poland Market Share of sales, 1H19 Growth, 1H19 YoY Comments • RO: Strong Purcari performance, up c. +30% YoY, per IFRS RO 40% +16% and +44% per managerial reporting1. Overall, the growth in Romania per managerial reporting was +33%. St
Slide 18: Brands: Bostavan and Purcari lead the growth
2 Brands: Bostavan and Purcari lead the growth Brand Share of sales, 1H19 Growth, 1H19 YoY Comments • PURCARI: ongoing strong traction in Romania, growing circa 30% per IFRS versus 2018, ample headroom 39% +22% remaining (growth per managerial accounts +33%1. Continue to see adverse effects of distr
Slide 19: Profitability growing ahead of sales, on strong GM and good GA control
2 Profitability growing ahead of sales, on strong GM and good GA control Comments ∆ RON m 1H18 1H19 ’19/’18 ▪ Revenue up 25%, well-above guidance range of 18-22%, on Revenue 70.0 87.8 25% strong performance of Bostavan, Bardar brands. ▪ Higher 1Q dynamics partly impacted by historical accounting Cos
Slide 20: Excellent feedback from digital natives, dominate premium segment
2 Excellent feedback from digital natives, dominate premium segment #1 presence in the RON <30 and RON 30-60 segment; Hold 8 out of TOP-10 positions in the crucial RON 30-60 segment, 10 in TOP-25 • We remain obsessed about the quality of our wines, which pays off in excellent consumer feedback • In
Slide 21: Platinum & 97 points for our ~£13 Chardonnay @ Decanter
2 Platinum & 97 points for our ~£13 Chardonnay @ Decanter; beats £50+ wines Selected top awarded white wines at Decanter London 2019 Wine Origin Award Points Price (in UK) Chardonnay de Purcari (Chateau Purcari) Platinum 97 £12.95 Ried Steinertal Smaragd Grüner Veltliner (Alzinger) Gold 96 £41.39 Le
Slide 22: New government in Moldova, declaring pro-reform, pro-EU agenda
2 New government in Moldova, declaring pro-reform, pro-EU agenda Key ministers, bios Developments Maia Sandu Prime Minister • New government in place as of June 14. Coalition • World Bank between ACUM and Socialist parties • UNDP • Ministry of Economy • Predominantly technocratic backgrounds. Half t
Slide 23: Agenda
AGENDA Freedom Blend, indigenous grapes 1 Our Group from Moldova, Georgia, Ukraine; 91 points by Wine Enthusiast 2 1H2019 Operational Results 3 Update on 2019 Outlook 4 Q&A Page 23
Slide 24: Guidance 2019 – on track to deliver and, potentially, exceed guidance
3 Guidance 2019 – on track to deliver and, potentially, exceed guidance 2019 1H 2019 Target guidance fact Status Comments Organic • Maintaining growth significantly above guidance, yet we prefer to +18-22% +25% err on the prudent side and not raise guidance, given high effect of revenue growth late-
Slide 25: Agenda
AGENDA Cuvée de Purcari, 1 Our Group the extension to sparkling launched in 2017. Made according to 2 1H2019 Operational Results the traditional, Champenoise method, with in- 3 Update on 2019 Outlook bottle fermentation 4 Q&A Page 25
Slide 26: Thank you.
Thank you. Page 26