A.g. Barr P.l.c. · LSE:BAG
A.g. Barr P.l.c — FY2021 Earnings Presentation
33 slides from A.g. Barr P.l.c's earnings presentation, April 2021
Slide 1: AG Barr plc Final Results
AG Barr plc FINAL RESULTS 52 weeks ended 24 January 2021 1
Slide 2: Welcome and introduction
Roger White Welcome and introduction 2
Slide 3: Contents
Contents ○ Introduction and COVID-19 priorities ○ Financial review ○ Market update ○ Strategy execution update ○ Summary ○ Questions Roger White Stuart Lorimer Chief Executive Finance Director 3
Slide 4: Introduction
Introduction 2019/20 ○ Action taken in H2 to support our return to growth ○ Exited 2019/20 with strong momentum 2020/21 ○ Momentum carried into the first 6 weeks of the new financial year ○ Anticipated 2020/21 to be a period of strong recovery for the Group ○ Notwithstanding Covid-19 challenges 2020/2
Slide 5: COVID-19 - delivering on our priorities
COVID-19 - delivering on our priorities People and safety first ○ Successfully introduced enhanced range of safety and hygiene measures across all our operations ○ Ensured safest possible working conditions across sites ○ Seamlessly and effectively transitioned to technology-enabled home working for
Slide 6: Introduction
Introduction 2021/22 ○ Insight and experience gained in 2020 carried into 2021 ○ Flexible planning approach for year ahead ○ Ready to capitalise on growth potential of portfolio ○ Well positioned to benefit from the recovery phase ○ Carbon net zero by 2040 ambition 6
Slide 7: Financial review
Stuart Lorimer Financial review 7
Slide 8: Profit bridge: Jan 2020 to Jan 2021
Profit bridge : Jan 2020 to Jan 2021 PBT (pre exceptionals) down £4.6m (12.3%) Gross profit down £11.3m (10.7%) 8
Slide 9: Financial scorecard
Financial scorecard Jan 2021 v to Jan 2020 % v Jan 2020 Case volumes (million cases) 48.0 (4.9) (9.3%) Net revenue (£m) 227.0 (28.7) (11.2%) Profit before tax and exceptionals (£m) 32.8 (4.6) (12.3%) Exceptional items before tax (£m) (6.8) (6.8) Statutory profit before tax (£m) 26.0 (11.4) (30.5%) Gro
Slide 10: Gross margin (%)
Gross margin (%) Carbonates - 87% of gross profit Full year pricing benefits and continued growth in Barr flavours IRN-BRU Energy, and IRN-BRU XTRA offset margin impact of Down Up Down Up lower volumes 0.3pp 2.3pp 10.5pp 0.3pp Rockstar franchise loss has a positive margin impact Stills & water - 6% of
Slide 11: Commodities and currencies
Commodities and currencies Commodities Modest overall inflation overall with reductions in aluminium and virgin plastic being offset by increases on sugar and premium pricing of recycled plastic Short term volatility in FY 20/21 driven by COVID-19 and Brexit. No significant tariff impacts anticipated
Slide 12: Operating costs and margin
Operating costs and margin £6.8m (10)% reduction Logistics savings and benefits of significant cost control actions deliver c £7m savings ○ Logistics costs reductions from lower volume 3PL activity and cost to serve initiatives ○ Other savings from now complete reorganisations and Furlough benefits ○ M
Slide 13: Exceptional items
Exceptional items Exceptional cash items Business re-engineering programme FY 19/20 FY 20/21 Total programme Portfolio & RTM : simplification and rationalisation £(1.1)m - £(1.1)m Reorganisation charge £(0.7)m £(3.1)m £(3.8)m Total £(1.8)m £(3.1)m £(4.9)m Rockstar compensation receipt - £7.6m Net cas
Slide 14: Cash flow
Cash flow £39m increase, benefiting from cash conservation measures 14
Slide 15: Balance sheet: Key ratios
Balance sheet : Key ratios Strong funding platform Strong cash generation Net cash (£m) Banking facilities of £60m until February 2022, then £20m until February 2025 (extension discussions ongoing) Well invested asset base Net assets (£m) Net asset growth : impact of Strathmore impairment offset by
Slide 16: 2021/22 Guidance
2021/22 Guidance Scenario planning aligned with current government COVID-19 roadmaps ○ Full year revenue expected to be in high single digit growth Revenue (excluding 20/21 Rockstar) ○ Full year revenue (on reported basis) expected to be broadly flat ○ Operating margin expected to be consistent with
Slide 17: Market and strategy execution update
Roger White Market and strategy execution update 17
Slide 18: Total UK soft drinks market
Total UK soft drinks market Total UK soft drinks value Total UK soft drinks volume Up 1.8% Up 2.4% Carbonates value Carbonates volume Up 7.8% Up 7.8% Stills value Stills volume Down 5.1% Down 2.7% Food service and licensed soft drinks sales reported down c.£4bn in 2020 - predominantly colas, mixers
Slide 19: Total UK soft drinks market - sub categories
Total UK soft drinks market - sub categories Source: IRI Marketplace 52 weeks to 24/01/21 19
Slide 20: UK soft drinks - market dynamics
UK soft drinks - market dynamics ○ “On the go” outlets significantly impacted ○ High street footfall dramatically down ○ “Take Home” sales benefit - particularly evident in carbonates Source: IRI Marketplace 52 weeks to 24/01/21 20
Slide 21: Barr Soft Drinks - market overview
Barr Soft Drinks - market overview AG Barr £ share UK IRN-BRU £ share of Rubicon £ share of Barr Flavours £ share soft drinks OFCs fruit drinks of OFCs Down 0.6% Down 3.9% Up 3.1% Up 14.2% AG Barr £ share UK Rubicon £ share of IRN-BRU XTRA £ Barr Flavours £ growth soft drinks - Eng & flavoured water
Slide 22: Cocktail market dynamics
Cocktail market dynamics On trade : Q1 2020 pre lockdown GB consumers drinking Value of cocktails in GB UK outlets stocking cocktails cocktails out of home £624m 43.5k 10.3m Up 6.4% Up 3.7% Up 13% Take home : People who consume mixed drinks in pubs and bars doing so at home 10.3m 50% - up from 37% p
Slide 23: Steadfast business fundamentals
Steadfast business fundamentals 23
Slide 24: No Time To Waste environmental sustainability programme
No Time To Waste environmental sustainability programme Ambition to be net zero by 2040 ○ 100% renewable electricity already across all sites ○ Increased quantum and pace of rPET ambition ○ 100% rPET IRN-BRU and Rubicon by early 2022 ○ 100% rPET across full portfolio by the end of 2023 ○ 100% recycl
Slide 25: Reset & Ready
Reset & Ready Reset Recovery Ready ○ Strong brand equity ○ Simplified SKUs ○ Balanced and broad customer ○ Re-focused brand hierarchies channel coverage ○ Optimised organisation ○ Realigned pricing ○ Rebalanced capacity vs. cost base ○ Take-home growth momentum ○ Upgraded assets ○ Engaged and talente
Slide 26: Barr Soft Drinks: Core brand building - IRN-BRU
Barr Soft Drinks : Core brand building Invest, innovate, execute - IRN-BRU ○ Marketing investment designed to deliver the greatest ever consumer reach in England & Wales planned ○ IRN-BRU Energy - format development and further investment ○ Unique (for Scotland) opportunity associated to Euros footb
Slide 27: Barr Soft Drinks: Core brand building - Rubicon
Barr Soft Drinks : Core brand building Invest, innovate, execute - Rubicon ○ Development of a Masterbrand approach to increase marketing effectiveness - across our portfolio of Sparkling, Spring, Still and Innovation ○ Flavour development to drive growth across the portfolio ○ NEW for 2021 - Rubicon
Slide 28: Barr Soft Drinks: Core brand innovation
Barr Soft Drinks : Core brand innovation 10% of UK population 26% of energy drink UK energy drink market buys big can energy consumers drink more worth £1.4bn drinks - 5.9m people than 2 cans per week 28
Slide 29: Funkin: Multi-beverage evolution
Funkin : Multi-beverage evolution Funkin multi-beverage platform enters 2021 with exciting momentum ○ Positive consumer cocktail consumption dynamics ○ Funkin on-trade rebound expected to be strong ○ Development of take-home business continues in 2021 ○ Distribution, Innovation and Rate of Sale ○ Gr
Slide 30: Funkin: Multi-beverage innovation
Funkin : Multi-beverage innovation Extension of New SPRITZ style New take home RTD range sparkling cocktails cocktail syrups 30
Slide 31: Group: Digital development
Group : Digital development Hiya Cocktail lovers, get your favourite drinks delivered to your Leveraging consumer digital dynamics front door in 5 working days! ○ B2B2C ○ D2C ○ Subscription ○ Gifting 31
Slide 32: Summary
Summary Exiting the pandemic with a leaner, more agile and stronger business ○ Roadmap out of lockdown now clearer, but not certain ○ Strong balance sheet ○ £50m cash ○ Significant financial leverage potential ○ Clear ambition to create value through strategic growth - organic and non-organic ○ Ready
Slide 33: Questions
AGBarr BUILDING GREAT BRANDS 33