Coca-Cola HBC AG · LSE:CCH
Coca-Cola HBC — Q3 2014 Earnings Presentation
23 slides from Coca-Cola HBC's earnings presentation, Nov 6, 2014
Slide 1: 2014 Third Quarter and Nine Month Results Presentation
2014 THIRD QUARTER AND~= NINE MONTH RESULTS ~~ PRESENTATION ., - > co . y FE ; 6 November 2014 * i = BottlingiCompe
Slide 2: Forward-looking statements
2 Forward-looking statements Unless otherwise indicated, the condensed consolidated financial statements and the financial and operating data or other information included herein relate to Coca-Cola HBC AG and its subsidiaries (“Coca-Cola HBC” or the “Company” or “we” or the “Group”). This document
Slide 3: Third quarter highlights
Third quarter highlights • Good market share gains • Volume declined in the quarter at a faster pace than in the first half • unseasonably poor weather in Established markets • our strategic decision to focus on sustainable value-accretive volume in Developing markets • Increase in currency-neutral
Slide 4: Financial review
Financial review Michalis Imellos - CFO
Slide 5: Financial performance overview
Financial performance overview Q3’14 Q3’13 Ch. 9M’14 9M’13 Ch. Volume (m u.c.) 548 575 -5% 1,518 1,579 -4% Net Sales Revenue (€m) 1,817 1,918 -5% 5,000 5,299 -6% Currency-neutral NSR per case (€) 3.32 3.23 +3% 3.29 3.21 +3% Comparable Gross Profit Margin 36.7% 36.8% -10bps 36.2% 35.9% +30bps Compara
Slide 6: Financial performance overview
Financial performance overview Q3’14 Q3’13 Ch. 9M’14 9M’13 Ch. Comparable EBIT (€m) 201 207 -3% 368 386 -5% Comparable EBIT Margin 11.1% 10.8% +30bps 7.4% 7.3% +10bps Comparable Net Profit (€m) 148 148 flat 247 259 -5% Comparable EPS (€) 0.41 0.41 flat 0.68 0.71 -4% Free Cash Flow (€m) 250 248 +1% 3
Slide 7: 13th consecutive quarter of growth in currency-neutral net sales revenue per case
13th consecutive quarter of growth in currency-neutral net sales revenue per case Q3’14 9M’14 Total CCH Volume -5% -4% Currency-neutral revenue per case +3% +3% Established Markets Volume -10% -6% Currency-neutral revenue per case +1% +1% Developing Markets Volume -11% -8% Currency-neutral revenue p
Slide 8: Input cost environment continues to be favourable
Input cost environment continues to be favourable • Currency-neutral input cost per case decreased by low single digits in the quarter and mid single digits in the first nine months • EU sugar costs continued to decrease year on year • World sugar costs remained on a downward trend • PET resin costs
Slide 9: Continued efficiency improvements support profitability
Continued efficiency improvements support profitability Q3’14 Q3’13 Ch. 9M’14 9M’13 Ch. Net Sales Revenue (€m) 1,817 1,918 -5% 5,000 5,299 -6% Comparable Operating Expenses (€m) (467) (498) -6% (1,440) (1,518) -5% Comparable OPEX as % of NSR 25.7% 26.0% -30bps 28.8% 28.6% +20bps Comparable EBIT Marg
Slide 10: Mixed segmental trends in comparable operating profit
Mixed segmental trends in comparable operating profit Q3 comparable EBIT Q3’14 Q3’13 in million Euros Total CCH -6 201 207 Established -9 65 74 Developing -6 32 38 Emerging 8 104 96 Financial indicators on a comparable basis exclude the recognition of restructuring costs, unrealised commodity hedgin
Slide 11: Restructuring update
Restructuring update Q3 recap • We incurred €18.6m in pre-tax restructuring costs in the third quarter • Restructuring focus predominantly in Established markets FY 2014 targets • We now expect total pre-tax restructuring charges to amount to €50m in 2014 • Total benefits in 2014 (from 2013 and 2014
Slide 12: Positive free cash flow in the quarter
Positive free cash flow in the quarter Q3’14 Q3’13 Abs. 9M’14 9M’13 Abs. in million Euros change change EBITDA 265 296 (31) 613 624 (11) Cash from Working Capital 96 79 18 8 23 (15) Net Capital Expenditure (88) (105) 17 (228) (257) 29 Free Cash Flow 250 248 2 345 345 flat * Differences in the absolu
Slide 13: Diversified financial profile
Diversified financial profile Debt maturity portfolio in million €800 €600 $400 September November June 2015 2016 2020 13
Slide 14: 2014 Financial outlook
2014 Financial outlook • Currency-neutral net sales revenue per case expected to grow year on year at a higher rate than 2013 • Currency-neutral input costs per case are still expected to decline by low single digits • Adverse FX impact is now estimated to be in the €80m - €85m range • Comparable ef
Slide 15: Operational review and strategy
Operational review and strategy Dimitris Lois - CEO
Slide 16: Fragile environment and unseasonably poor weather
Fragile environment and unseasonably poor weather 575m u.c. 548m u.c. -10% -11% +1% Q3 ‘13 Established Developing Emerging Q3 ‘14 16
Slide 17: Juice was the key category driver in the quarter
Juice was the key category driver in the quarter y-o-y growth Q3 ‘14 9M’ 14 Sparkling -5% -4% Trademark Coca-Cola -5% -4% Coca-Cola Zero -1% 5% Juice 7% 4% Multon 16% 10% Water -5% -3% Energy -1% 1% Tea -8% -8% 17
Slide 18: Established markets: Acceleration of negative volume trends
Established markets Acceleration of negative volume trends Italy • Volume declined by mid teens in the quarter • Underlying macroeconomic and trading Trademark Coca-Cola Water environment remains challenging Coca-Cola Zero -7% • Adverse weather resulted in the acceleration of -11% -3% negative trend
Slide 19: Developing markets: Focus on value
Developing markets Focus on value Poland • Volume declined by low double digits, cycling a low single-digit decline in the prior year Trademark Coca-Cola Water Coca-Cola Zero -18% • Our value-accretive volume initiatives -7% -3% contributed to the decline, while supporting good NSR/case growth Hunga
Slide 20: Emerging markets: Growth in a volatile environment
Emerging markets Growth in a volatile environment Russia • Volume declined by low single digits, cycling low single-digit decline Trademark Coca-Cola Juice RTD-Tea Water • Disposable income under pressure +13% -13% +1% stable • Multon juice business grew by 10% 11th consecutive quarter of growth Nig
Slide 21: Looking ahead
Looking ahead • We maintain our sharp focus on gaining share and delivering good profitability despite the significant volume headwinds. • Group volume trends for 2014 are expected to be broadly similar to the ones we saw in the first half • We expect to achieve another year of EBIT margin expansion
Slide 22: For further information on Coca-Cola Hellenic
FOR FURTHER INFORMATION ON-COCA-COLA HELLENIC PLEASE VISIT OUR WEBSITE AT: ~ WWW.COCA-COLAHELLENIC.COM — OR CONTACT OUR INVESTOR RELATIONS TEAM ‘ INVESTOR.RELATIONS@CGHELLENIC.COM +30.210.6183 100 - _ o 6 ie, ms ? = Micnic Bottling’Comp
Slide 23: Long-term growth drivers
Long-term growth drivers Most known brands in the world Diverse geographic footprint with Low per capita consumption with strong emerging market exposure great potential to grow Solid track record of winning in the Strong focus on cost leadership and marketplace history of solid cash generation 23