Molson Coors Beverage Company · NYSE:TAP
Molson Coors Beverage — Molson Coors Brewing Company — Q2 2019 Earnings Presentation
24 slides from Molson Coors Beverage's earnings presentation, Jul 31, 2019
Slide 1: Q2 2019 Earnings
Q2 2019 EARNINGS JULY 31, 2019
Slide 2: Forward Looking Statements
FORWARD LOOKING STATEMENTS This presentation includes “forward-looking statements” within the meaning of the U.S. federal securities laws. Generally, the words “believe,” “expect,” “intend,” “anticipate,” “project,” “will,” “outlook,” and similar expressions identify forward-looking statements, whic
Slide 3: Mark Hunter, President and CEO
MARK HUNTER PRESIDENT AND CEO 3
Slide 4: Second Quarter 2019
SECOND QUARTER 2019 NSR COGS/HL UNDERLYING EBITDA KEY TAKEAWAYS (constant currency) (constant currency) (constant currency) • Weak industry in May and June in U.S., -2.9% +6.0% -12.8% Canada, and Europe • Strong pricing in all BUs • Incremental brand investment • Maintained cash flow focus Q2'18 Q2'
Slide 5: Focus: Delivering Growth & Long-Term Shareholder Value
FOCUS: DELIVERING GROWTH & LONG-TERM SHAREHOLDER VALUE EARN MORE USE LESS INVEST WISELY BUILD BRAND LED EXTRAORDINARY DRIVE GROWTH BRANDS SYNERGIES OPPORTUNITIES AND COST STRENGTHEN STRENGTHEN SAVINGS BALANCE CUSTOMER EXCELLENCE SHEET INCREASE DRIVE DISRUPTIVE RETURN CASH TO PRODUCTIVITY SHAREHOLDER
Slide 6: Earn More
EARN MORE • Strong pricing across all business units • Positive global mix • Improved share trends in the U.S. • Maintained share in Europe • Reshaping and premiumizing portfolio • Readiness to spend against this focus DISRUPTIVE GROWTH U.S. EUROPE CANADA INTERNATIONAL 6
Slide 7: Use Less: Cost Savings and Canada Brewery Modernization
USE LESS COST SAVINGS CANADA BREWERY MODERNIZATION 2017-2019 $700 MILLION 2020-2022 $450 MILLION GREENFIELD IN LONGUEUIL, QUEBEC SAVINGS FROM • World Class Supply Chain 2.0 • Greenfield breweries in Canada • Global Business Services • New IT & Procurement initiatives • More rigorous ZBB 1
Slide 8: Invest Wisely
INVEST WISELY M&S / HL DEBT / EBITDA S&P 5.3x 5.1x Moody's 4.7x 4.4x 4.4x 4.1x H1'18 H1'19 Further 2.4x deleverage, 2.2x maintain M&S investment grade credit rating 2015 2016 PF 2017 2018 2019 H1'18 H1'19 8
Slide 9: Tracey Joubert, Chief Financial Officer
T R AC E Y J O U B E RT CHIEF FINANCIAL OFFICER 9
Slide 10: Second Quarter 2019
SECOND QUARTER 2019 NSR COGS/HL UNDERLYING EBITDA KEY TAKEAWAYS (constant currency) (constant currency) (constant currency) • Weak industry in May and June in U.S., -2.9% +6.0% -12.8% Canada, and Europe • Strong pricing in all BUs • Incremental brand investment • Maintained cash flow focus Q2'18 Q2'
Slide 11: United States Q2 2019 Performance
UNITED STATES Q2 2019 PERFORMANCE KEY TAKEAWAYS NSR COGS/HL UNDERLYING EBITDA • Softer industry demand • Continued price discipline -2.9% +4.7% -8.2% • COGS/HL increase driven by inflation, volume deleverage, furnace-related packaging costs • Higher total marketing investment focused on above premiu
Slide 12: Europe Q2 2019 Performance
EUROPE Q2 2019 PERFORMANCE NSR COGS/HL UNDERLYING EBITDA KEY TAKEAWAYS ( cons t a nt cur r e ncy ) ( cons t a nt cur r e ncy ) ( cons t a nt cur r e ncy ) • Softer industry demand • Positive pricing and -2.4% +7.5% -18.4% favorable mix • COGS/HL increase primarily driven by inflation and volume dele
Slide 13: Canada Q2 2019 Performance
CANADA Q2 2019 PERFORMANCE NSR COGS/HL UNDERLYING EBITDA KEY TAKEAWAYS ( cons t a nt cur r e ncy ) ( cons t a nt cur r e ncy ) ( cons t a nt cur r e ncy ) • Softer industry demand -2.9% +7.6% -25.4% • Continued positive pricing • COGS/HL increase driven by inflation and distribution costs, unfavorab
Slide 14: International Q2 2019 Performance
INTERNATIONAL Q2 2019 PERFORMANCE NSR COGS/HL UNDERLYING EBITDA KEY TAKEAWAYS ( cons t a nt cur r e ncy ) ( cons t a nt cur r e ncy ) ( U S D mi l l i ons , cons t a nt cur r e ncy ) • Volume impacted by higher net pricing on -12.1% +7.8% -10.8% Coors Light in Mexico $6.5 • COGS/HL driven by $5.8 in
Slide 15: Outlook
OUTLOOK 2019 CONSOLIDATED Mid-single digit percentage increase constant currency UNDERLYING COGS/HL ~$700M 2017-2019 COST SAVINGS $450M 2020-2022 2019 INTERNATIONAL Strong double digit percentage increase constant currency UNDERLYING EBITDA 2019 UNDERLYING FCF $1.4 billion +/- 10% In-line with 20% t
Slide 16: Mark Hunter, President and CEO
MARK HUNTER PRESIDENT AND CEO 16
Slide 17: Earn More: Commercial Excellence Drivers
EARN MORE : COMMERCIAL EXCELLENCE DRIVERS ENHANCED COMMERCIAL CAPABILITIES WILL DRIVE TOP & BOTTOM LINE BUILD EXTRAORDINARY STRENGTHEN CUSTOMER DRIVE DISRUPTIVE BRANDS EXCELLENCE GROWTH ENERGIZE CORE BRANDS EXPAND PORTFOLIO GROW ABOVE PREMIUM & CRAFT DIGITAL & E-COMMERCE BUILD GLOBAL BRANDS ACCELERA
Slide 18: Earn More: Build Extraordinary Brands
EARN MORE : BUILD EXTRAORDINARY BRANDS ENERGIZE CORE BRANDS GROW ABOVE PREMIUM AND CRAFT More than 50% growth Q2 brand volume in the U.S. YoY Nielsen top 10 growth Q2 and YTD YoY + strong double digits or better brand [since early June] BUILD GLOBAL BRANDS STWs Blue Moon and Belgian Moon Q2 in Inter
Slide 19: Earn More: Build Extraordinary Brands
EARN MORE : BUILD EXTRAORDINARY BRANDS • We will recruit new drinkers - especially 21-34 years old who are stressed out by being “always on” • Coors Light’s mountain cold refreshment brings replenishing moments of Chill 19
Slide 20: Earn More: Strengthen Customer Excellence
EARN MORE : STRENGTHEN CUSTOMER EXCELLENCE UNITED STATES EUROPE CENTRAL EUROPE NPS 65 60 55 50 45 H2 2018 H1 2019 On Trade Off Trade RANKED #1 FOR ON-PREMISE UK RANKED #1 FOR ON-PREMISE 2ND YEAR IN A ROW RANKED #1 BEER SUPPLIER STRONG NPS PROGRESS #1 IN 4 OF THE 7 PERFORMANCE AREAS CANADA WON PARTNE
Slide 21: Earn More: Drive Disruptive Growth
EARN MORE : DRIVE DISRUPTIVE GROWTH EXPAND PORTFOLIO DIGITAL & E-COMMERCE PREMIUMIZE DEVELOPING OUR BRANDS AND PORTFOLIO IN A WAY THAT INCREASES VALUE “built by our customers for our customers” LIVE IN UK & HUNGARY PILOTS IN CROATIA AND ROMANIA ACCELERATE INTERNATIONAL GROWTH MODERNIZE MOVING OUR PO
Slide 22: Disruptive Growth: Truss Update
DISRUPTIVE GROWTH: TRUSS UPDATE • Truss is the non-alcoholic cannabis beverage specialist, not a cannabis generalist. • The portfolio of brands will utilize best-in-class infusion technology, flavoring capabilities, and production and quality control protocols at its Belleville, Ontario facility. •
Slide 23: Focus: Delivering Growth & Long-Term Shareholder Value
FOCUS: DELIVERING GROWTH & LONG-TERM SHAREHOLDER VALUE EARN MORE USE LESS INVEST WISELY BUILD BRAND LED EXTRAORDINARY DRIVE GROWTH BRANDS SYNERGIES OPPORTUNITIES AND COST STRENGTHEN STRENGTHEN SAVINGS BALANCE CUSTOMER EXCELLENCE SHEET INCREASE DRIVE DISRUPTIVE RETURN CASH TO PRODUCTIVITY SHAREHOLDER
Slide 24: Q&A
MOLSON Cot Q&A
Molson Coors Brewing Company — Q2 2019 Earnings Presentation on 6ix