Anora Group Oyj · OMXHEX:ANORA
Anora Group Oyj — Investor Presentation (March 2023)
73 slides from Anora Group Oyj's investor presentation, March 2023
Slide 1: Growth through sustainability
Growth through sustainability Investor presentation March 2023
Slide 2: Contents
Contents 03 Introduction 06 Our strategy: Delivering growth through sustainability 11 Our sustainability roadmap: Regenerate the future 21 Market and trends 25 The leading wine and spirits brand house in the Nordics 38 Our industrial business 45 Financials 53 Why invest in Anora 57 Appendix: M&A 67
Slide 3: The leading wine and spirits brand house in the Nordic region
Anora | Market positions The leading wine and spirits brand house in the Nordic region and an industry forerunner in sustainability Forerunner in sustainability Finland Norway Wine Spirits Wine Spirits #1 #1 #1 #1 Sweden Denmark Wine Spirits Wine Spirits #2 #1 #1 #2 Baltics Germany Wine Spirits Aqua
Slide 4: A well-balanced business across categories and countries
Anora | Key figures A well-balanced business across categories and countries Net sales, MEUR Comparable EBITDA, MEUR Personnel 703 76.1 1,250 I ndustrial I ndustrial Sweden 19% 23% 27% Wine 44% DFTR & Anora Export Beverage brands Net sales 5% Net sales net sales 48% Partner by segment by country bra
Slide 5: Strong and versatile portfolio of leading own and partner brands
Anora | Brands Strong and versatile portfolio of leading own and partner brands Key Anora brands Key partner brands Wine Wine Spirits Spirits Investor presentation | March 2023 | 5
Slide 6: Delivering growth through sustainability
Anora | Our vision Delivering growth through sustainability We are the leading Nordic wine and spirits group delivering growth through sustainability. Our passion takes the best of the Nordics to the world and the best of the world to the Nordics. We are Anora, let’s drink better! Investor presentat
Slide 7: Our growth strategy up to 2030
Anora | Strategy Our growth strategy up to 2030 Lead category growth Scale our position in across consumer occasions Denmark and the Baltics and channels in the Swedish, to cement our regional Norwegian and Finnish markets as OUR AMBITION leadership the wine and spirits powerhouse Recognised #1 in E
Slide 8: Delivering growth through sustainability
Anora | Our ambitions Delivering growth through sustainability Faster-than-market growth (1.5x) in our core monopoly markets Share of international1 from ~10% (today) to ~20% (future) 3–5% Annual net sales growth Including M&A, majority is organic Hero brands from ~15% (today) to ~30% (future) 2 Sel
Slide 9: Our sustainability roadmap to growth
Anora | Sustainability at the centre Our sustainability roadmap to growth We are committed to set Science- Based Targets. Investor presentation | March 2023 | 9
Slide 10: Strong values and company culture support our growth
Anora | Our values Strong values and company culture support our growth COURAGE ENERGY EMPOWERING TO EXPLORE TO INSPIRE TO WIN We are passionate and We share a can-do attitude Our dynamic, open and ambitious to lead the industry. and enjoy going the extra inclusive way of working We hav e the courag
Slide 11: Our sustainability roadmap
Our sustainability roadmap Investor presentation | March 2023 | 11
Slide 12: Substantial reduction of CO2 emissions at Koskenkorva Distillery
Sustainability | Roadmap Substantial reduction of CO₂ emissions at Koskenkorva Distillery Significant use of renewable energy at Gjelleråsen Investor presentation | March 2023 | 12
Slide 13: Key drivers
Sustainability | Roadmap Key drivers Nordic monopolies have agreed to ✓ Decrease the CO₂ footprint of the supply chain by 50% within 2030 ✓ Minimise the use of heavy weight glass bottles ✓ Maximise the share of low carbon footprint packaging ✓ Support new innovative low carbon packaging solutions An
Slide 14: Planet
Sustainability | Roadmap Planet 1 2 3 Carbon neutral We increase the share We reduce wast ewater operations by 2030 of regenerat ively wit h 20%, increase and Koskenkorva farmed barley t o 30% recycling rate of waste Distillery by 2026 – of own grain spirit to 90% and reduce without products by 2030
Slide 15: Science-based targets: near-term and long-term
Sustainability | Roadmap We are committed to set Science-Based targets Near-term Long-term 2030 Reduction target of 38% 2050 aligned with 1.5°C Net Zero covering Scopes 1–3 Sources Investor presentation | March 2023 | 15
Slide 16: How we will reduce emissions by 2030
Sustainability | Roadmap How we will reduce emissions by 2030 SCOPE 1+2 SCOPE 3 ◼ Category 9: Downstream transportation and distribution Packaging 4% 26,594 tCO2e 21.67% > 68% ◼ Categories 5+6+7: Wines of category 1 0.5% 18.3% of which emissions ◼ Category 4: 86% comes from Barley SCOPE 3: Upstream
Slide 17: Milestones to zero emissions in own production
Sustainability | Roadmap Milestones to zero emissions in own production Bioenergy plant at Koskenkorva distillery Koskenkorva heat pump Anora Electricity Non-renewable CO2 emissions per tonne baseline in Finland to 100% renewable Gjelleråsen steam (LPG) to biogas Koskenkorva Rajamäki steam boiler so
Slide 18: People
Sustainability | Roadmap People 1 2 3 100% of risk countries We increase the We ensure diversity, covered with audits number of safety equity and inclusion or certificates. 100% observations and at work. of suppliers have reduce accidents signed amfori code resulting to absence of conduct in 2023. t
Slide 19: Product
Sustainability | Roadmap Product 1 2 3 By 2030 all packages are We increase We support a light in weight, 100% the amount of modern, responsible recyclable and of sustainable and drinking culture materials from certified NoLo choices sources or recycled origin CO2 footprint of different Glass BiB pa
Slide 20: Building our sustainable future together with key partners
Sustainability | Partners Building our sustainable future together with key partners E S G GRI TCFD Taxonomy Investor presentation | March 2023 |
Slide 21: The Nordic wine and spirits market
The Nordic wine and spirits market Investor presentation | March 2023 | 21
Slide 22: The Nordic wine and spirits market is large and non-cyclical
The Nordic market The Nordic wine and spirits market is large and non-cyclical Large and profitable market Non-cyclical business Stable historical growth and solid growth forecast Spirits: Wine: Value of the Nordic wine and spirits market 1 Wine and spirits consumption vs. GDP growth (Norway) 2 v ol
Slide 23: Extensive experience in operating with monopolies and regulated markets
The Nordic market | Monopolies We have extensive experience in operating with monopolies and in the regulated markets State retail monopolies are Special characteristics of the monopoly markets Anora’s largest sales channel Monopoly route-to-assortment Alcoholic beverages in grocery • Tender process
Slide 24: Key trends shaping our business
The Nordic market | Trends Key trends shaping our business Premiumisation Consumers Balancing Demand for and in-home Digital are going consumption convenience consumption disruption green habits after COVID 14% environmental & No- and low (NoLo) 16% global volume Long-term tailwinds to 93% of consum
Slide 25: Wine: Lead in growing sustainable wine, win share across markets
Wine Lead in growing sustainable wine, win share across markets Investor presentation | March 2023 | 25
Slide 26: We are the market leader in the Nordics
Wine | Introduction We are the market leader in the Nordics Capabilities in partner wine imports and own label wine make us unique Net sales, MEUR Gross margin Comparable EBITDA margin 316 30% 23.5% • Multiple independent wine • Dev eloping, sourcing, filling and Partner import companies, long histo
Slide 27: Target to grow sales faster than the market: +3.6% annually
Wine | Growth ambition Target to grow sales faster than the market: +3.6% annually Improving profitability following increased share of own label wine Wines net sales ambition, EURm1 38% Anora Wines Vingruppen Partner Filling Market CAGR Market CAGR Market CAGR Market CAGR (21-30) 1,3% (21-30) 1,4%
Slide 28: Lead in growing sustainable wine, win share across markets
Wine | Growth priorities Lead in growing sustainable wine, win share across markets Our growth priorities Impact Target 2030 Grow Vingruppen NS +15% to Grow Vingruppen through focus on MEUR 260 and partner filling monopoly tenders and on-trade +20MEUR Grow faster than the overall market Win in the g
Slide 29: Long-term profitable growth in spirits
Spirits Long-term profitable growth in spirits Investor presentation | March 2023 | 29
Slide 30: Market leader in the Nordics and strong challenger internationally
Spirits | Introduction We are the market leader in the Nordics and a strong challenger internationally Net sales, MEUR Gross margin Comparable EBITDA margin 234 44% 28% Spirits – Monopoly market • Norway • Finland • Sweden Spirits – international • Denmark • Baltics • Germany • Global trav el retail
Slide 31: Leader on the stable and profitable spirits market
Leader on the stable and profitable spirits market The strongest spirits portfolio in the market with iconic local and international brands Partner brands 27% Net sales by Anora’s hero brands brand type are exported to some 30 countries Own brands 73% Not e: Spirit s cat egories are mapped direct ly
Slide 32: Triple the sales internationally and lead the Nordic markets
Anora’s growth strategy | Focus areas for Spirits Triple the sales internationally and lead the Nordic markets Our growth priorities Impact Target 2030 Strong development in on-trade channel drives us to Earn the right to expand partner business Monopoly markets reach above-market growth in partner
Slide 33: Growth driven by market share and RTD and NoLo
Spirits Monopoly | Growth ambition Growth driven by capturing market share and building new business with RTD and NoLo Topline projected to grow ~4% CAGR 2022-2030; profitability relatively flat in early years, increase in A&P investments in early years Market CAGR (21-26) 1,2% Market CAGR (21-30) 2
Slide 34: Tripling international sales by 2030 supported by M&As
Spirits International | Growth ambition Tripling international sales by 2030 and increasing share from 10% to 20% supported by M&As Topline projected to grow at ~17% CAGR 2022-2030; profitability weak in early years, given significant increase in A&P and people investments Net sales ambition of Spir
Slide 35: Funding the growth journey through efficiency
Industrial Funding the growth journey through efficiency Investor presentation | March 2023 | 35
Slide 36: State-of-the-art supply chain
Industrial | Introduction State-of-the-art supply chain Industrial and logistics business Supply chain footprint Net sales, MEUR* Comparable EBITDA margin ◼ Bottling production 160 17.7% 136 million litres I ndustrial Logistics serv ices (Vectura) 35% ◼ Distillation production 30 15% million litres
Slide 37: Efficient supply chain enables growth
Industrial | Supply chain Efficient supply chain enables growth Logistics centres Bottling plants Distilleries Outstanding route-to-market through efficient World class bottling plants for spirits and wines – Unique distillation and maturation logistics capabilities covering 23.3% of all forerunner
Slide 38: Koskenkorva is a unique distillery
Industrial | Industrial business Innovations enabling premium products and growth Koskenkorva is a unique distillery • Koskenkorva Climate Action Vodka of regeneratively farmed grain Sustainability, innovation, premium quality • Koskenkorva organic vodka and efficiency all in one • High quality etha
Slide 39: Performance and productivity developing positively
Industrial | Efficiencies Performance and productivity Execution of supply chain developing positively – Culture of synergy benefits is on track… continuous improvement Rajamäki • Strong execution capability: Prompt follow-up and Bottling OEE Working hours +44% actions of planned synergy benefits ac
Slide 40: With further efficiencies in the pipeline
Industrial | Improvement steps …with further efficiencies in the pipeline Estimated additional efficiency potential is EUR 5-10 million per year, implementation during next 3 years Execution of Supply Chain Platform, including Globus Wine Scope: 1. Scale benefits of Procurement Assessment 2. Logisti
Slide 41: Funding the growth journey through efficiency
Industrial | Closing Funding the growth journey through efficiency Internal culture Additional Sustainability drives efficiency efficiency potential identified and growth Continuous improv ement Globus Wine volumes provide Pioneering sustainability work will culture enables positive performance addi
Slide 42: Value creation through profitable growth
Financials Value creation through profitable growth Investor presentation | March 2023 | 42
Slide 43: Our long-term financial targets for 2030
Financials | Targets Our long-term financial targets for 2030 3–5% 16% <2.5x 50–70% Annual net sales Comparable EBITDA Net interest-bearing Dividend growth margin debt / comparable pay-out ratio EBITDA Including M&A, Through increased focus on Debt levels may occasionally Anora aims t o maint ain a
Slide 44: All commercial units contributing to growth
Financials | Net sales All commercial units contributing to growth; strongest growth will come from outside the Nordic monopoly markets Illustrative Anora Group revenue development by unit 2021 PF actuals – 2030F, EUR millions ~950-1.150 +5% 3-5% 739 640 665 2019 PF 2021 PF Globus 2021 incl. Wine gr
Slide 45: Earnings driven by topline growth and efficiency improvements
Financials | Profitability Earnings driven by topline growth, incremental marketing investments financed by efficiency improvements and expanded margins Illustrative Anora Group EBITDA development 2021 PF actuals – 2030F, EUR millions; % of net sales 15% ~-3% ~0% ~2% ~-2% ~0% ~4% 16% ~150-180 101 80
Slide 46: Cash generation expected to remain stable
Financials | Cash generation Cash generation expected to remain stable throughout the strategy period thanks to stable margins, capex and working capital Anora’s underlying business will Anora is well invested. Capex will Throughout the strategy period, continue to produce strong remain at current l
Slide 47: We will continue to use M&As to support our strategy
Financials | M&A We will continue to use M&As to support our strategy Strategic Lead category growth across consumer Scale our position in Denmark and Accelerate beyond the Nordics pillar occasions and channels in the Swedish, the Baltics to cement our regional with strong, sustainable Norwegian and
Slide 48: Key figures
Financials | Key figures Key figures (IFRS) 2022 2021 Net sales, EUR million 702.7 478.2 Comparable EBITDA, EUR million 76.1 71.7 % of net sales 10.8 15.0 Items affecting comparability, EUR million 67.9 -8.8 Result for the period, EUR million 18.1 31.2 Earnings per share, EUR 0.26 0.67 Net debt, EUR
Slide 49: Strengthened financial capacity for growth outside Nordics
Financials | Key financials Strengthened financial capacity for growth outside Nordics Net sales and comparable EBITDA1 EURm Net cash flow from operating activities1 EURm 478.2 357.3 359.6 342.4 52.6 56.1 50.8 71.7 76.1 37.6 52.4 40.0 44.8 6.5 -0,4 2018 2019 2020 2021 2022 2017 2018 2019 2020 2021 2
Slide 50: Why invest in Anora?
Financials Why invest in Anora? Investor presentation | March 2023 | 50
Slide 51: Value creation: higher growth at improved margins
Why invest in Anora | Value creation Value creation: higher growth at improved margins, with strong cash flow generation and stable dividends • Increased rev enue growth through market share gains in home markets Higher revenue growth and international expansion • M&A to strengthen our capabilities
Slide 52: Thank you
Thank Thankyou you Investor presentation | January 2023 | 52
Slide 53: Contact details
www.anora.com investor.relations@anora.com Follow us: Investor presentation | January 2023 53 |
Slide 54: Appendix: M&A
Appendix: M&A Investor presentation | March 2023 | 54
Slide 55: Altia and Arcus merger
Merger Altia and Arcus merger The leading wine and spirits brand house in the Nordic region and an industry forerunner in sustainability 1 September 29 September 23 July Merger completed: Brand divestments Anora is formed Merger plan agreed – all regulatory announced 3 September approvals for the me
Slide 56: Strong value creation for shareholders from significant synergies
Merger Strong value creation for shareholders from significant synergies Synergy sources Sourcing and manufacturing Logistics and warehousing Cost SG&A Other OPEX Expansion in core Nordic markets Revenues Acceleration in non-core and new markets Potential run-rate EBITDA net synergies EUR ~8-10m Inv
Slide 57: Step-change in scale with efficiencies across the value chain
Merger Step-change in scale with efficiencies across the value chain Increase scale and control of own operations leads to reduced carbon footprint, more sustainable operations and less complexity resulting in improved efficiency and profitability Strong manufacturing Efficiency gains across the val
Slide 58: Synergy realisation progressing as planned
Merger synergies Synergy realisation progressing as planned 9.8 4.6 ~3-5 ~8-10 Potential run-rate EBITDA net synergies EUR ~8-10 million of 5.4 which about 80% realised within 2 years of merger completion 5.2 4.3 Well on track to deliver on the promised strategies Remaining synergies will be integra
Slide 59: Acquisitions & investments
Acquisitions & investments Globus Wine – leading wine company in Denmark ISH – innovative scale-up in non-alcoholic beverages Investor presentation | January 2023 | 59
Slide 60: Acquisition of Globus Wine, the leading wine company in Denmark
Acquisition of Globus Wine Acquisition of Globus Wine, the leading wine company in Denmark Strengthens Anora's competitiveness in volume products Consistent above-market growth Near-market filling reduces CO 2 foot print significantly. Market share 26% The Danish wine in still wines market is estima
Slide 61: Market-leading wine company in Denmark
Acquisition of Globus Wine Market-leading wine company in Denmark Founded in 2006 Key figures Net sales split by line of business Sources wine in bulk to be filled in bag-in-boxes or bottles at Employees Net sales Adjusted EBITDA the production facility in Køge Filler 37% Products are sold under own
Slide 62: Anora invests in ISH
Investment in ISH Anora invests in ISH, the award- winning Danish scale-up company in non-alcoholic beverages Anora has made an investment of EUR 5 million in ISH ISH is a Danish scale-up company in non-alcoholic beverages founded in 2018 by Morten Sørensen ISH is a global leader in non-alcoholic (N
Slide 63: Appendix: January – December 2022 results
Appendix: January – December 2022 results 63
Slide 64: Net sales grew by 5.7 %
Financials | FY 2022 Net sales grew by 5.7 % Decline in profitability due to normalisation after Covid-19, higher opex and lower gross margin Market: The decline in volumes was related to the Anora: Net salesgrow th driven by the strong performance of the Globus Wine in Denmark, normalising of the c
Slide 65: Wine
Wine Events and product launches in Q4 Q4 Highlights NET SALES (TOTAL), MEUR • Good performance of Blossa 22 +16% with Blossa Rosé and Blossa Äppelglögg • Net sales increased by 15.9% to EUR 108 107.9 (93.1) 93 • Il Capolavoro of Globus Wine in • Net sales excluding Globus was Sweden EUR 82.6 millio
Slide 66: Spirits
Spirits Q4 Highlights NET SALES (TOTAL), MEUR Product launches in Q4 -2% • Net sales EUR 72.2 (74.0) million • In Sweden and Norway, seasonal aquavits, 74 72 e.g., Aalborg Juleakvavit 2022, O.P. Anderson • Growth in international sales, e.g. Julaquavit, Prima Julsnaps, Herrgårds Julakvavit, Baltics,
Slide 67: Industrial
Industrial Q4 Highlights NET SALES, TOTAL, MEUR +17% • External net sales grew by 17.4% to 79 EUR 45.5 (38.7) million. 68 33 Internal • Growth was driven by higher sales 29 prices in industrial products and contract manufacturing and following 46 External the increase in the cost of barley. 39 • Pro
Slide 68: Barley sourcing
Barley sourcing Average barley price increased by 15% from Q4 21 to Q4 22 Q4 22: 47.9 (49.8) million kilos Historically, over a 5-year period, of grain the average barley market price BARLEY PRICE DEVELOPMENT (EUR/TN)* has been about 218 €/tn 400 275 350 e/tn** 300 250 200 150 100 50 0 2007 2008 200
Slide 69: Balance sheet key figures
Balance sheet key figures • The increase in net debt was due to the acquisition of Globus 2022 2021 Wine which was financed with debt. Net debt / comparable EBITDA (rolling 12 months) 4.0 1.8 • Cash and cash equivalents amounted to EUR 91.4 (168.9) million, while the interest-bearing debt including
Slide 70: Outlook 2023
Outlook 2023 • Comparable EBITDA expected to be between EUR 80-90 million. • Volumes in the monopolies are expected to be significantly lower than during COVID-19 restrictions. • Input costs are expected to remain at a high level. 2022 Results presentation | March 2023 | 70
Slide 71: Appendix: Governance
Appendix: Governance Investor presentation | March 2023 | 71
Slide 72: Anora's top 10 shareholders
Ownership structure Anora's top 10 shareholders Shareholder (31 December 2022) Shares % of shares ILLUSTRATION OF ANORA’S OWNERSHIP STRUCTURE Solidium Oy 13 097 481 19.4 Varma Mutual Pension Insurance Company 2 031 240 3.0 Rest of the world Ilmarinen Mutual Pension Insurance Company 1 290 000 1.9 0.
Slide 73: Building the future on our strong brands
History Building the future on our strong brands, continuous evolution and sustainable operations 2006– 1996 Expansion to other Nordic countries 1807 Arcus established Sale of industrial spirits business 2016 The oldest aquavit as a dem erger from Arcus IPO at the Oslo brand in the world Vinmonopole