Remy Cointreau Sa · EURONEXT:RCO
Remy Cointreau Sa — Remy Cointreau Sa Ord — H1 2021-22 Earnings Presentation
41 slides from Remy Cointreau Sa's earnings presentation, Nov 25, 2021
Slide 1: 2021-22 H1 Results
2 0 2 1 - 2 2 H 1 Re s u l t s November 25, 2021
Slide 2: Marc Hériard Dubreuil, Chairman
Marc Hériard Dubreuil, Chairman
Slide 3: Record performance in 2021-22 H1
Record performance in 2021 -22 H1 A h a l f - ye a r p a c ke d w i t h i n i t i a t i v e s 2021-22 H1 BUSINESS FINANCING Share buyback New distillery for DHG METAXA open Liknon - Samos Group takes out €80m loan June 2021 June 2021 Oct. 2021 Nov. 2021 SUSTAINABILITY Mount Gay x 4ocean Telmont sust
Slide 4: Introduction
Introduction Eric Vallat, CEO
Slide 5: Excellent first half-year performance
Excellent first half -year performance… SALES GM COP FCF * * +52.0% 69.1% +104.5% €29.5m * * +26.9% +4.0pp 33.0% 0.77 vs. 2Y of sales Ratio A €645.3m €445.9m €212.9m On track to become the world leader of exceptional spirits 5 (*) Organic growth
Slide 6: Strong progress in our strategic priorities
… showing strong progress in our strategic priorities Increase Enhance value per case portfolio management Cointreau: > +50%* Sales mix-price : +16.8pp The Botanist: > +80%* Gross margin: +2.0pp vs 2Y PHD Malts: > +35%* 21-22 H1 Implement Achieve client centric model responsible growth #APlanetOfExc
Slide 7: Achieve responsible growth
A c h i e ve re s p o n s i b l e g ro w t h Ambitious short- and long-term commitments to combat climate change 2021 -22 2030-2050 Partnership with South Pole #APlanetOfException ↘ 50% carbon emissions by 2030 Carbon neutrality Net zero emissions by 2050 > Fund certified projects > Joining the Scie
Slide 8: Business Review
Business Review Eric Vallat, CEO
Slide 9: Broad-based growth driven by all divisions
Broad-based growth driven by all divisions Cognac Liqueurs & Spirits Group 25% Cognac Liqueurs & Spirits Partner Brands Group Sales 3% breakdown 72% +55.2% +46.9% +52.0% +27.0% vs. 2Y +26.9% vs. 2Y +26.9% vs. 2Y Group brands: +52.9% Partner brands: +23.6% 9 Organic sales growth
Slide 10: Outstanding growth in the US and China
Outstanding growth in the US and China Group: +52.0% 28% EMEA 55% +33.5% Group sales AMERICAS -8.0% vs. 2Y breakdown APAC +60.2% 17% +59.2% vs. 2Y +49.3% +7.2% vs. 2Y APAC EMEA Americas 10 Organic sales growth
Slide 11: Cognac division
Cognac division Sales €464.6m Organic change (%) +55.2% Volume / Price-Mix (%) +35.0% / +20.2% Current operating profit €188.1m Organic change (%) +101.9% Current operating margin (%) 40.5% Organic change (pp) +9.2pp 11
Slide 12: Cognac: organic sales growth of +55.2%
Cognac: organic sales growth of +55.2% H1 sales split by region 34% 58% 8% Rémy Martin - XO Atelier Thiery Limited Edition Americas EMEA APAC North America: very strong double-digit sales growth fueled by steadily high underlying demand (new paradigm) China: very strong double-digit sales growth led
Slide 13: Cognac: 40.5% of COP margin
Cognac: 40.5% of COP margin (+9.2pp*) Reported COP/Sales : +9.8pp +5.7pp +4.0pp +0.6pp 0.0pp -0.5pp Volume: +2.1 pp Price/Mix: +1.9 pp 40.5% 30.6% Organic COP margin: +9.2pp 20/21 H1 Gross A&P Distribution & Currency Scope 21/22 H1 COP margin Margin Others COP margin 13
Slide 14: Liqueurs & Spirits division
Liqueurs & Spirits division Sales €164.1m Organic change (%) +46.9% Volume / Price-Mix (%) +37.2% / +9.7% Current operating profit €37.8m Organic change (%) +121.5% Current operating margin (%) 23.1% Organic change (pp) +8.4pp 14
Slide 15: Liqueurs & Spirits: organic sales growth of +46.9%
Liqueurs & Spirits: organic sales growth of +46.9% 12% 50% 38% Americas EMEA APAC North America: very strong double-digit sales growth led by Cointreau, The Botanist and St-Rémy EMEA: very strong double-digit sales growth with all countries and brands contributed to growth China: strong double-digit
Slide 16: Liqueurs & Spirits: 23.1% of COP margin
Liqueurs & Spirits: 23.1% of COP margin (+8.4pp*) Reported COP/Sales : +6.4pp +4.9pp +0.2pp +3.8pp -0.9 pt -2.2 pp -0.3pp Volume: +1.9pp +0.9pt Price/Mix: +1.9pp 23.1% 16.6% Organic COP/Sales: +8.4pp 20/21 H1 Gross A&P Distribution & Currency Scope 21/22 H1 COP margin Margin Others COP margin 16
Slide 17: Financial results
Financial results Luca Marotta, CFO
Slide 18: Current Operating Profit
Current Operating Profit Ending September (in €m) 21/22 H1 20/21 H1 Reported % Organic % Net Sales 645.3 430.8 +49.8 % +52.0 % Gross Profit 445.9 278.6 +60.0 % +61.4 % % of sales 69.1% 64.7% +4.4pp +4.0pp Sales and marketing expenses (172.1) (128.6) +33.8 % +34.5 % Administrative expenses (60.9) (43
Slide 19: Current operating margin of 33.0%
Current operating margin of 33.0% (+8.5pp*) Reported COP/Sales : +8.3pp +5.3pp +4.0pp -0.6pp +0.4pp -0.8pp Volume: +2.0 pp Price/Mix: +2.0 pp 33.0% 24.7% Organic COP/Sales: +8.5pp 20/21 H1 Gross A&P Distribution/ Currency Scope 21/22 H1 COP margin Margin others COP margin 19
Slide 20: Net profit
Net profit Ending September (in €m) 21/22 H1 20/21 H1 Reported % Organic % Current Operating Profit 212.9 106.2 +100.4 % +104.5 % Other operating income (expenses) (13.6) (0.2) - - Operating Profit 199.3 106.0 +88.0 % +92.0 % Net financial income (charge) (7.4) (8.0) -8.4 % -5.2% Profit Before Tax 1
Slide 21: Non-recurring items
Non-recurring items Ending September (in €m) 21/22 H1 20/21 H1 Net Profit – Group share 134.0 65.0 Other operating income (expenses) 13.6 0.2 Non-recurring tax items (3.4) (0.1) Impact of tax rate changes on deferred taxes in France and the UK 4.0 - Net Profit excluding non-recurring items – Group s
Slide 22: Net debt / Cash flow
Net debt/ Cash flow Ending September (in €m) 21/22 H1 20/21 H1 Change Opening net financial debt (1 April) (314.3) (450.9) 136.6 Gross operating profit (EBITDA) 235.4 123.8 111.5 WCR of eaux-de-vie and spirits in ageing process 23.9 23.4 0.4 Other working capital items (152.2) (64.5) -87.8 Capital e
Slide 23: Net financial expenses
Net financial expenses Ending Sept. (in €m) 21/22 H1 20/21 H1 Net debt servicing costs (5.5) (6.1) Net currency gains (losses) (0.4) (0.6) Other financial expenses (net) (1.5) (1.3) Net financial income (charges) (7.4) (8.0) 23
Slide 24: Foreign exchange – Hedging impact
Foreign exchange – Hedging impact 2016-17 2017-18 2018-19 2019-20 2020-21 2021-22E Average EUR/USD exchange rate 1.10 1.17 1.16 1.11 1.17 1.18 Average EUR/USD hedged rate 1.11 1.19 1.18 1.16 1.17 1.19 Total sales impact (in €m) (5.7) (48.9) 1.5 24.5 (36.3) 0 Total COP impact (in €m) 23.6 (18.5) (6.8
Slide 25: Balance sheet as of September 30, 2021
Balance sheet as of September 30, 2021 (€m) Sept. in % Sept. in % Sept. in % Sept. in % 2021 2020 2021 2020 Non-current Shareholders’ 929 33% 864 33% 1,586 56% 1,466 56% assets equity Current 1,905 67% 1,662 64% Current and Non- assets 850 30% 634 24% current liabilities o/w inventories 1,513 53% 1,
Slide 26: Outlook
Outlook Eric Vallat, CEO
Slide 27: Ahead of our 2030 strategic plan
Ahead of our 2030 strategic plan It starts with a great product… ✓ … supported by an attractive brand… Accelerate & measure A&P … and a great client experience and journey… Develop direct-to-client activities … in an ever-changing work environment Build new capabilities 27
Slide 28: 2021-22: Year of incremental investments
2 0 2 1 - 2 2 : Ye a r o f i n c re m e nta l i nve st m e nt s Investing behind our global priority brands 28
Slide 29: 2021-22: Year of incremental investments
2 0 2 1 - 2 2 : Ye a r o f i n c re m e nta l i nve st m e nt s Investing behind our global priority brands 29
Slide 30: 2021-22: Year of incremental investments
2 0 2 1 - 2 2 : Ye a r o f i n c re m e nta l i nve st m e nt s Implementing client centric model 30
Slide 31: 2021-22: Year of incremental investments
2 0 2 1 - 2 2 : Ye a r o f i n c re m e nta l i nve st m e nt s Implementing client centric model 31
Slide 32: Balanced capital allocation – increasing focus on sourcing
2 0 2 1 - 2 2 : Ye a r o f i n c re m e nta l i nve st m e nt s Balanced capital allocation – increasing focus on sourcing c. €70m c.€170m in 2021-22 Share buyback €50-60m as of now Strategic WCR in 2021-22 outflow €1.85 20/21 Dividend o Production/factories: c. 50% o Consistent dividend policy o In
Slide 33: Full-year guidance upgraded
Full-year guidance upgraded Confident to outperform the exceptional spirit market 2021-22 is expected to be a year of two halves both in terms of sales and COP organic growth Sales: strong organic Full-year growth, with H1 strongly above H2 growth A&P: meaningful increase in marketing spend, particu
Slide 34: 2030 objectives confirmed
2030 objectives confirmed 2019/20 2020/21 2030 Gross margin(*) 66.0% 66.8% 72.0% Current operating margin(*) 21.0% 23.3% 33.0% 100% sustainable agriculture by 2025 25% reduction in carbon emissions (scope 1 & 2) and 30% value per case reduction (scope 3) by 2025 Net zero carbon emissions by 2050 (*)
Slide 35: Appendices
Slide 36: Quarterly Sales by division
Quarterly Sales by division Organic % Organic % In €m Q1 21/22 Q1 20/21 Reported % vs. Q1 20/21 vs. Q1 19/20 Cognac 199.6 98.7 102.3% 114.4% 29.8% Liqueurs & Spirits 85.3 46.1 84.9% 90.5% 58.0% Subtotal: Group Brands 284.9 144.8 96.8% 106.8% 37.0% Partner Brands 8.2 5.3 55.6% 55.3% 21.8% Total 293.1
Slide 37: Foreign exchange - Hedging impact
Foreign exchange - Hedging impact 1.19 1.19 1.18 1.17 1.16 1.16 1.16 1.18 1.17 1.17 1.11 1.16 1.14 Hedged rate €/$ 1.12 Average €/$ 1.11 1.10 2016-17 2017-18 2018-19 2019-20 2019-20 2020-21 2020-21 2021-22 March March March September March September March September 37
Slide 38: Key events during the half-year
Key events during the half -year • 3 June 2021 Launch of a share buyback programme of 1m shares Pursuant to this authorization, an investment services provider will be instructed to purchase up to a maximum of 1 million shares of Rémy Cointreau SA, accounting for 1.98% of the share capital, at the p
Slide 39: Post closing events
Post closing events • 3 November 2021 Climate commitments Rémy Cointreau launched the #APlanetOfException project, which focuses on a dual commitment: (i) to reduce the Group’s carbon footprint (in line with the Paris Climate Agreement) as part of its official membership of the SBT initiative and (i
Slide 40: Next financial publication
Next financial publication Jan. 25, 2022 2021-22 Q3 Sales April 29, 2022 2021-22 FY Sales June 2, 2022 2021-22 FY Results July 21, 2022 Shareholder Meeting 40
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