Vina Concha Y Toro S.a. · BCS:CONCHATORO
Vina Concha Y Toro — Investor Day (April 2021)
114 slides from Vina Concha Y Toro's investor day presentation, Apr 28, 2021
Slide 1: Strategic Vision
Presentation Eduardo Guilisasti – CEO 2021 Strategic Vision
Slide 2: Today Concha y Toro is a different Company
Today Concha y Toro is a different Company
Slide 3: 2020: The best in the Company's history
INVESTOR DAY 3 2020: The best in the Company’s history, accross all major indicators.
Slide 4: Volume recovered in 2017
INVESTOR DAY 4 ANNUAL PERFORMANCE 2017 – 2020 After 2 years of no growth, volume recovered in 2017 Volume (millions of 9 lt cases) 0.5% 37.0 37.2 35.0 35.1 +5.9% 2017 2018 2019 2020
Slide 5: Better mix: Principal + Invest exceeding 30%
INVESTOR DAY 5 A better mix, with Principal + Invest Principal + Invest Share of total volume exceeding 30% of total volume 22.8% 30.3% 77.2% 69.7% 2017 2020 Principal+Invest Others
Slide 6: Historic sales in 2020
INVESTOR DAY 6 Historic sales in 2020, huge growth compared to previous year Net Sales Value (CLP billion) +25.4% 769.1 657.0 613.5 614.1 +17.1% 2017 2018 2019 2020
Slide 7: Principal + Invest Mix grows and surpasses 45% of sales
INVESTOR DAY 7 Principal + Invest Mix grows 10 p.p. and surpasses Principal + Invest Share of total net sales value 45% of total sales 35.5% 45.5% 64.5% 54.5% 2017 2020 Principal+Invest Others
Slide 8: Strategy target: double Operating Profit in 5 years
INVESTOR DAY 8 When defining our Strategy, the main indicator we set ourselves to evaluate success CLP 140,000 MM was Operating Profit, with a very clear objective: to double it in 5 years CLP 70,000 MM 2017 2022
Slide 9: Historical Operating Profit of CLP 120 billion
INVESTOR DAY 9 O P E R AT I N G P R O F I T Historical result of Operating Profit CLP 120 billion (CLP billion) and 56% growth compared to 2019 +94.3% +56.1% 120.3 61.9 60.0 77.1 2017 2018 2019 2020 Operating Margin (%) 10.1% 9.8% 11.7% 15.6%
Slide 10: Outstanding Cost Management
INVESTOR DAY 10 Outstanding Cost Management (CLP million) 2017 2018 2019 2020 CAGR 17-20 Revenue 613,516 614,129 656,980 769,067 7.8% Operating Cost 412,079 409,543 415,584 461,198 3.8% Gross Profit 201,437 204,586 241,397 307,870 15.3% Gross Margin % 32.8% 33.3% 36.7% 40.0% Note: Percentage change
Slide 11: Strict Expenses Control
INVESTOR DAY 11 Strict Expenses Control 2017 2018 2019 2020 CAGR 17-20 (CLP million) 613,516 614,129 656,980 769,067 7.8% Revenue SG&A 144,118 149,127 162,975 185,177 8.8% SG&A/Revenue % 23.5% 24.3% 24.8% 24.1% 0,7 p.p. increase
Slide 12: Higher Operating Profit margin
INVESTOR DAY 12 Higher Operating Profit (%), of +5.5 p.p., grows to 15.6% compared to 2017 Annual Performance 2017- 2020 Accounting Values Change in p.p. 40.0% 36.7% 2017-2020 32.8% 33.3% Gross Profit + 7.2 24.3% 24.8% 24.1% 23.5% SG&A/Revenue - 0.6 15.6% 10.1% 11.7% 9.8% Operating Profit + 5.5 2017
Slide 13: What is cyclical and what is structural?
INVESTOR DAY 13 The big question behind these numbers is: What is cyclical (exchange rate, grape prices, one-off effect of the pandemic) and what is structural (changes that are here to stay)?
Slide 14: Cyclical factors served as a catalyst
INVESTOR DAY 14 ANSWER: Cyclical factors played an important role. However, beyond their quantitative impact, they served as a catalyst to take the Company to another level.
Slide 15: Today Concha y Toro is a different Company
INVESTOR DAY Today Concha y Toro is a different Company Concha y Toro Day 28 de abril de 2021
Slide 16: Milestones in recent history
INVESTOR DAY 16 Milestones in Concha y Toro’s recent history: Year 2016: Biennium 2017-2018: Biennium 2019-2020: In-depth review of our business Definition of the New Strategy Acceleration in Strategy model. and start of its implementation. implementation with the ZBP (brand reduction) acting as a R
Slide 17: Species that survive are best adapted
17 Phenomenon of the biological world, which fits perfectly with the survival of companies. “The species that have survived the longest are not the strongest but those best adapted to the environment in which they live.”
Slide 18: In 2017 we began a long journey
18 In 2017 we began a long journey which would bring profound transformations in all our business units, in both depth and scope, with very challenging objectives:
Slide 19: Definition of a New Strategic Vision
19 D E F I N I T I O N O F A N E W S T R AT E G I C V I S I O N : “To be a consumer centric winery focused on our origin premium brands that captivate consumers and to ensure a simple, agile and sustainable model which satisfies demand and delivers value.”
Slide 20: Definition of a New Strategic Vision
20 D E F I N I T I O N O F A N E W S T R AT E G I C V I S I O N : “To be a consumer centric winery focused on our origin premium brands that captivate consumers and to ensure a simple, agile and sustainable model which satisfies demand and delivers value.”
Slide 21: Definition of a New Strategic Vision
21 D E F I N I T I O N O F A N E W S T R AT E G I C V I S I O N : “To be a consumer centric winery focused on our origin premium brands that captivate consumers and to ensure a simple, agile and sustainable model which satisfies demand and delivers value.”
Slide 22: Process restructuring and cost savings
INVESTOR DAY 22 Process restructuring and cost savings: CLP 18,000 million
Slide 23: Recovery of profitability in domestic markets
INVESTOR DAY 23 Recovery of profitability in domestic markets: Chile (2016: 1.6%) and USA (2016: 1%)
Slide 24: Strategic Commercial Vision: brands
INVESTOR DAY 24 A clearly defined Strategic Commercial Vision in terms of brands, with the goal of establishing relevant brands in different markets: Principal (Casillero del Diablo) and Invest (brands from the three origins in the Premium and superior categories). A B R A N D M AT R I X W A S D E F
Slide 25: Strategic Commercial Vision: markets
INVESTOR DAY 25 A clearly defined Strategic Commercial Vision in terms of Markets, with the goal of increasing our share in major markets: those with our own distribution. In the rest, adapt RTM. A market matrix was defined for a better resource allocation.
Slide 26: Productivity across the Production Logistics Chain
INVESTOR DAY 26 Seek high productivity levels across the entire Production Logistics Chain: Agricultural, Winemaking and Supply Chain areas. Maintain a strong commitment to quality and strengthen our vineyards’ geographic diversity.
Slide 27: Strong commitment to Sustainability
INVESTOR DAY 27 Strong commitment to Sustainability. Our Innovation and Research Center’s Project: A Strategic Plan for climate change adaptation and more efficient water use.
Slide 28: Strength of Strategy implementation
INVESTOR DAY 28 The numbers below will demonstrate the strength in all dimensions of our Strategy’s implementation. This model will make the Company significantly less dependent on the two most volatile factors over time: exchange rates and grape prices.
Slide 29: Savings achieved to 2019
INVESTOR DAY 29 1.- Savings achieved to 2019: CLP 19,293 MM In Costs: In Expenses: CLP 13,501 MM CLP 5,792 MM 2021-2023 Triennial Principal savings: Plan: • Personnel reduction (30%) Additional cost and • Two plants closed, one for production and one for expense savings plan winemaking (26%) under s
Slide 30: Improved profitability of certain markets
INVESTOR DAY 30 2.- Significant improvement in profitability of certain markets: CHILE DOMESTIC USA DOMESTIC ARGENTINA TRIVENTO 7.2% 14.1% 21.0% January – February 2020 2020 2021
Slide 31: 2021-2023 Triennial Plan
INVESTOR DAY 31 -39 87 (-49%) Concha y Toro (-12) 80 Quinta de Maipo (-22) 72 Trivento (-1) 41 44 57 Fetzer Vineyards (-4) 2021-2023 Triennial Plan: 40 41 To make China the Company's 34 highest market in terms of 29 29 operating margin percentage. 29 24 16 Change in strategy, strong 5 12 6 5 7 reduc
Slide 32: Premium and Superior brands growth
INVESTOR DAY 32 3.- Four of the Company’s the Premium and Superior categories are among the six brands with the highest sales, all with growth rates of over 30% in 2020: 2021-2023 Triennial Plan: Wine line extensions from other origins, for the Company's strongest brands. • Based on the strengths an
Slide 33: Share of markets with own distribution
INVESTOR DAY 33 4.- Significant share of markets with their own distribution (UK, USA, Brazil, Mexico, Canada, Sweden, Norway, Finland, Chile and Argentina): 76%. As well as in those markets with direct sales to major retailers (Ireland, Denmark, Belgium, the Netherlands and Switzerland): 5%.
Slide 34: Opening of direct distribution in China
INVESTOR DAY 34 Opening of direct distribution in China 2021-2023 Triennial Plan: Strengthen our distribution channels. A unit has been created for all of Europe, with the exception of our own distribution offices, to move towards a commercial model of greater integration with retailers.
Slide 35: Agricultural Area Productivity
INVESTOR DAY 35 5.- Agricultural Area Productivity: Growth in yields sequence, in tons per hectare EVOLUTION OF TONS/HA CLONAL - ROOTSTOCKS VS OTHER 22.0 20.0 18.2 18.0 17.0 Otras 15.5 15.3 16.0 14.0 12.8 13.0 Clonal PortaInj 12.0 12.6 13.6 12.7 14.1 16.5 19.0 14.8 17.9 13.9 19.2 17.3 20.5 Media 10.
Slide 36: Agricultural Area Productivity: plantings
INVESTOR DAY 36 5.- Agricultural Area Productivity: Our planting process makes us the Company with the highest grape production in the global wine industry. Plantings in hectares: Chile: 10,445 A great advantage Trivento Argentina: 1,452 against climatic risk is the diversity Fetzer USA: 416 of our
Slide 37: Project Plant 2.0
INVESTOR DAY 37 Projecto Plant 2.0: Technology transfer to Agricultural Management Genetic diagnosis and 2021-2023 Triennial verification platform Biologically strengthened Plan: The Innovation and QUALITY PURITY 4 VIRUSES – 2 clean plants Research Center together with STANDARD + FUNGI (beneficial m
Slide 38: Winemaking Area Productivity
INVESTOR DAY 38 6.- Winemaking Area Productivity: • The Smart Winery project seeks to implement automation in the different processes and to have state- of-the-art equipment. We are always evaluating new technology. For example: This plan has allowed us to increase fermentation capacity, without hav
Slide 39: Harvest 2021 forecast
INVESTOR DAY 39 6.- Winemaking Area Productivity : Harvest 2021: The crop is expected to be in line with the budget in terms of kilos to be received. Following the rains, all possible measures were taken and an adverse situation was very well controlled. 2021-2023 Triennial Plan: We want to continue
Slide 40: Supply Chain Area Productivity
INVESTOR DAY 40 7.- Supply Chain Area Productivity: Given the thorough implementation of the Strategy, a strong reduction in the Company’s number of brands was expected. This phenomenon was accelerated with one of the most emblematic projects we have launched: ZBP (Zero Based Portfolio), where we ch
Slide 41: SKU reduction and packaging productivity
41 The consequence of the above was twofold: a reduction in the number of SKUs and larger productive lots. More productive lots, increase in packaging line productivitiy: Reduction of SKUs, less raw material needed: +17% compared to 2017 -21% compared to 2017 Evolution Dry Raw Material [# SKUs] Pack
Slide 42: Sustainability Project
INVESTOR DAY 42 8. Sustainability Project Water resources and climate Results: change: 1. Measurement of Applied research in the area of water evapotranspiration in resources, incorporating technology for experimental vineyards. The their management and optimization, as result of this technology tra
Slide 43: Looking ahead with optimism
43 With these solid foundations, we look forward to this year and the years to come with great optimism.
Slide 44: Opportunities from the current situation
Great opportunities are presented by the current situation which will give a powerful drive to the Company’s growth, in perfect alignment with its Strategy.
Slide 45: Trends 2020 and projections 2021
Trends 2020 and projections 2021
Slide 46: Consumer trends 2020
INVESTOR DAY 46 Consumer trends 2020 AT HOME: Given the pandemic, consumers are retreating to their homes. There are changes in consumption habits and occasions, such as formal and informal on-line gatherings or more people cooking and eating at home. MORE OCCASIONS: Increase in the number of possib
Slide 47: Consumer trends 2021
INVESTOR DAY 47 Consumer trends 2021 HOME IS THE NEW CENTER: Consumers’ homes are becoming the new “centers” of everything (work, education, etc.). This situation is expected to continue beyond the lockdowns, and drive consumption of wine at home. ! GOING OUT VERY CAUTIOUSLY: A reactivation of trave
Slide 48: Price tiers: premiumization trend
INVESTOR DAY 48 PRICE TIERS: Premiumization trend intensified in 2020 VALUE (ABSOLUTE VAR) VALUE (ABSOLUTE VAR) VALUE (ABSOLUTE VAR) T.VINO WINE T. 11.2% WINE T. T.VINO 17.4% T. VINO WINE T. 30.8% 20.0 + 26.4% 10.0 + 30.8% 11+ 78.1% 11.0 - 19.99 19.0% 7.0 - 9.99 33.2% 9 - 10.99 45.9% 4.00 - 10.99 6.
Slide 49: 2021 objectives
49 2021: • Consolidate the high growth achieved in 2020, in markets and brands. • Strong recovery in sales in markets that were affected in 2020.
Slide 50: Commercial Strategy
Presentation Blanca Bustamante – Investor Relations Director 2021 Commercial Strategy
Slide 51: Accelerated achievement of Strategy 2022 targets
EVOLUTION 2017 - 2020 Accelerated achievement, in line with Strategy 2022 targets.
Slide 52: Focus on premium brands with high growth potential
52 Focus on premium brands with high growth potential • Brand Matrix is the reference framework for defining sales targets and marketing investment. • 25 brands accounted for 80.5% of sales. • Continuous revision seeking greater focus (there were 32 brands in 2018). HIGH INVEST PRINCIPAL • Don Melch
Slide 53: Successful reorientation to the premium segment
53 Successful reorientation to the premium segment G R O W T H B Y B R AN D C AT E G O RY I N 2 0 2 0 VAL U E V O L UM E 23% Growth in volume for categories Principal & Invest in 2020 Other wine brands
Slide 54: Principal + Invest exceed 30% of volume
54 Better mix: Principal + Invest exceed 30% of total volume 22.8% Volume 30.3% Principal & Invest MIX +7.5 points 77.2% 69.7% 2017 2020 Principal+Invest Others
Slide 55: Principal + Invest exceeds 45% of sales
55 Principal + Invest Mix increases 10 percentage points and exceeds 45% sales 35.5% Sales Value 45.5% Principal & Invest MIX +10 points 64.5% 54.5% 2017 2020 Principal+Invest Others
Slide 56: Relevant track record and brand recognition
56 Relevant track record and brand recognition Principal variations by Premium and lower brands (Thousands of cases) 237 125 419 259 260 130 268 112 90 35,320 482 85 190 513 33,675 1,045 Marcas de la matriz Main changes con trayectoria compared to 2019, in y Challenged brands in relevant markets and
Slide 57: Focus on fine wines in key markets
57 Focus on fine wines in key markets Principal variations by Super Premium and superior brands (Thousands of cases) 16 6 20 16 34 13 11 1,655 46 8 7 7 2 75 122 ~75% in USA and Denmark 1,440 ~100% in Chile ~98% in UK ~85% in USA ~85% in UK and Chile R2019 Diablo Bonterra Trivento Late 1,000 Trivento
Slide 58: Growth of 1 MM cases
58 Growth of 1 MM cases UK Ireland +36% +57% 2,881 2,118 469 Global 299 +20% 6,337 2019 2020 2019 2020 5,301 Brazil Chile +13% +65% 421 363 373 220 (Thousands of cases) 2019 2020 2019 2020 2019 2020
Slide 59: Over 1 MM cases in UK
59 Over 1 MM cases in UK UK Benelux +70% +146% 1,069 42 Global 629 17 +57% 1,406 2019 2020 2019 2020 Brazil South Korea 893 +87% +845% 36 26 19 3 (Thousands of cases) 2019 2020 2019 2020 2019 2020
Slide 60: Successful innovation: 3-digit growth
60 Successful innovation: 3-digit growth rate Global Chile UK +109% +163% +158% 234 64 116 112 44 25 51 17 4 (Thousands of cases) 2018 2019 2020 2018 2019 2020 2018 2019 2020
Slide 61: Global 19% growth
61 Global 19% growth UK Irleland +19% +58% 447 159 377 Global 101 +19% 1,705 2019 2020 2019 2020 1,437 Chile Poland +37% +62% 90 158 66 98 (Thousands of cases) 2019 2020 2019 2020 2019 2020
Slide 62: Global 19% growth
62 Global 19% growth USA Global +16% +20% 562 479 486 400 2019 2020 2019 2020 (Thousands of cases)
Slide 63: Adverse global context for fine wines
63 With an adverse global context for fine wines +80% Over 3 MM 3,301 9L cases 1,834 Brazil Global 2019 2020 -8% 10,489 9,693 +38% Growth with few 337 resources Argentina 244 2019 2020 Expansion +208% of new 623 channels Singapore 202 2019 2020 2019 2020
Slide 64: Over 2 MM cases globally
64 Over 2 MM cases globally Global Brazil Mexico +28% +62% +20% 2,200 1,325 660 1,717 548 818 (Thousands of cases) 2019 2020 2019 2020 2019 2020
Slide 65: Great performance in Nordics
65 Great performance in Nordics Global Sweden Norway Finland +16% +16% +56% +27% 891 365 226 141 766 315 111 145 (Thousands of cases) 2019 2020 2019 2020 2019 2020 2019 2020
Slide 66: Focus markets with integrated distribution drive growth
66 Focus markets with integrated distribution drive growth In a pandemic context, markets and distribution channels are impacted differently % of sales Var. Value Var. Volume 2020 2020/19 2020/19 A MARKETS UK 24.9% 43.1% 23.3% USA 17.3% 20.5% (1.6%) Chile 15.7% 10.1% 7.9% Brazil 6.8% 33.4% 45.7% Nor
Slide 67: Value of vertical integration
67 Value of the Company’s vertical integration Main variations compared to 2019, in thousands of cases 186 99 60 380 215 348 642 340 37MM 321 121 706 98 77 39 157 1,579 35MM Mercados dondewe Markets where estamos integrados are integrated y/o and/or Markets where our relationship is donde have tenem
Slide 68: Historic 2020: Over 8 MM cases
68 Historic 2020: Over 8 MM cases Principal+Invest Mix % of total volume CyT-UK 43.2% 54.2% Volume (thousands of cases) 56.8% 45.8% +29% +23% 2017 2020 Principal+Invest Others 8,349 6,770 Number of brands 6,487 6,332 (only wine brands) 81 -21 10 60 -25 14 71 46 2017 2018 2019 2020 2017 2020 Principa
Slide 69: Historic 2020: Over 2 MM cases
69 Historic 2020: Over 2 MM cases Principal+Invest Mix % of total volume 16.5% 22.9% VCT-Brazil 83.5% 77.1% Volume +75% (thousands of cases) +46% 2017 2020 Principal+Invest Others 2,045 Number of brands (only wine brands) 1,403 -21 -21 1,166 1,141 67 8 46 -24 11 59 35 2017 2018 2019 2020 2017 2020 P
Slide 70: Change in mix: +3 p.p. Principal & Invest
70 Principal+Invest Mix Change in mix: +3 p.p. in Principal & Invest % of total volume 5.1% 8.2% 70.7% 71.2% VCT-Chile Volume (thousands of cases) 24.2% 20.6% +0.2% +7.9% 2017 2020 Principal+Invest Others (wine) Others (non wine) 9,604 9,568 9,621 Number of brands 8,915 (only wine brands) -11 81 13
Slide 71: 9-Brand Portfolio and focus on Principal + Invest
71 9-Brand Portfolio and focus on Principal + Invest Principal+Invest Mix % of total volume Ireland 78.o% 95.6% Volume (thousands of cases) 22.0% +87% 4.4% +58.0% 2017 2020 534 Principal+Invest Others Number of brands (only wine brands) 338 -3 300 12 286 4 9 5 -4 8 4 2017 2018 2019 2020 2017 2020 Pr
Slide 72: Strength in global distribution
72 Strength in global distribution: Increasing market share in key markets CyT-UK FETZER VINEYARDS #2 wine supplier China #1 wine of Chile, 53% share 7.7% share #1 Organic table wine, 53% share 60.8% mkt.share Chile #2 imported wine #15 total table wine, 1.1% share 32.7% mkt. share Argentina 6.3% sh
Slide 73: Gross profit increases 56%
73 Gross profit increases 56% Driven by higher volume of priority brands, better mix/price, and exchange rate effect +94.3% +56.1% (CLP billion) 120.3 61.9 60.0 77.1 2017 2018 2019 2020 Operating margin 10.1% 9.8% 11.7% 15.6%
Slide 74: Priority brands contribute 88% to Operating Profit
74 Priority brands contribute 88% to Operating Profit Operating Profit by Brand Category 28% 37% Principal & Invest 61% 26% +7 pp. 24% 23% 26% 2% 1% 21% 12% 2019 2020 Others Watch Protect Invest Principal
Slide 75: Financial Management
Presentation Osvaldo Solar – Corporate Finance Director 2021 Financial Management
Slide 76: Concepts to review
I N V E S T O R D A Y · F I N A N C I A L R E S U L T S 76 To fully understand the Company’s current and future results, we would also like to review the following concepts: 1. EBITDA Milestones 2. Consolidated Net Income Milestones 3. Return on Invested Capital 4. Financial Strength
Slide 77: EBITDA growth
I N V E S T O R D A Y · F I N A N C I A L R E S U L T S 77 1. EBITDA growth It is now 19.3% of sales 148,487 160,000 25.00% 140,000 42% 20.00% 120,000 104,557 19.3% 100,000 86,267 85,486 15.00% 15.9% 80,000 14.0% 13.9% Break 10.00% 60,000 40,000 5.00% 20,000 0 0.00% 2017 2018 2019 2020 EBITDA Margen
Slide 78: EBITDA growth of Trivento and Fetzer
I N V E S T O R D A Y · F I N A N C I A L R E S U L T S 78 Outstanding EBITDA growth of Trivento and Fetzer EBITDA TRIVENTO EBITDA FETZER 16,000 30.00% 18,000 10.4% 12.00% 26.4% 16,000 14,000 10.00% 25.00% 123% 13,416 14,000 80.6% 15,268 12,000 6.6% 123% 12,000 8.00% 20.00% 10,000 10,000 6.00% 8,000
Slide 79: Consolidated Net Income
I N V E S T O R D A Y · F I N A N C I A L R E S U L T S 79 2. Consolidated Net Income 90,000 10.1% 10.0% 80,000 77,994 8.0% +49% 70,000 8.1% 7.8% 8.0% 60,000 50,000 49,574 52,500 6.0% Concha y Toro winery 47,569 40,000 49% +4% 4.0% 30,000 20,000 2.0% 10,000 Other wineries 0 0.0% 2017 2018 2019 2020
Slide 80: Impact of non operating profit
I N V E S T O R D A Y · F I N A N C I A L R E S U L T S 80 In net income: Impact of “non operating” profit • Financial costs and exchange differences • Foreign currency diversification • Results of associated companies
Slide 81: Financial costs and exchange differences
I N V E S T O R D A Y · F I N A N C I A L R E S U L T S 81 Financial costs and exchange differences Exceptionally high 2020 expenses The non-operating result had net financial costs of CLP14,226 MM and exchange losses of CLP 4,423 MM. This gives us an Exceptional factors: expected future - Higher de
Slide 82: Foreign currency diversification
I N V E S T O R D A Y · F I N A N C I A L R E S U L T S 82 Foreign currency diversification NOK ARG CNY SEK CAD 1.5% 0.5% 0.3% 2.6% 3.1% MXN 4.1% BRL 6.2% USD • Diversification of currencies mitigates 31.3% variations of the US dollar as a single currency. EUR 9.3% • 2020: US dollar + 12%, CyT mix +
Slide 83: Associated Companies Results
I N V E S T O R D A Y · F I N A N C I A L R E S U L T S 83 Associated Companies Results Growth in Results Associates (Proportional value for Concha y Toro winery) ALMAVIVA INDUSTRIA CORCHERA 3,139 626 2,804 2,107 2,142 344 269 231 2017 2018 2019 2020 2017 2018 2019 2020
Slide 84: Return over Invested Capital
I N V E S T O R D A Y · F I N A N C I A L R E S U L T S 84 Return over Invested Capital 12.00% 10.00% 10.4% 8.00% 44% 6.00% 7.3% 7.2% 6.9% 4.00% 2.00% 0.00% 2017 2018 2019 2020 ROIC Roic: (Operating margin – Taxes + Exchange differences) / (Equity – Other financial liabilities – Cash)
Slide 85: Return over invested capital: efficiency
I N V E S T O R D A Y · F I N A N C I A L R E S U L T S 85 3. Return over invested capital: Efficiency in use of funds • Greater accounts receivable rotation. • Strategic growth of destination inventories. • CAPEX, focus on Profitability and Growth.
Slide 86: Greater accounts receivable rotation
I N V E S T O R D A Y · F I N A N C I A L R E S U L T S 86 Greater accounts receivable rotation Consolidated sales increased by 17.1%; however, accounts receivable (AR) decreased by 6.9% due to the effect of having achieved a shorter average collection Increase in sales CLP 112,087 MM period, which
Slide 87: Management and client quality
I N V E S T O R D A Y · F I N A N C I A L R E S U L T S 87 Key factors: MANAGEMENT and CLIENT QUALITY • 99% of accounts receivable with credit insurance (*). • Despite a difficult year, doubtful accounts and delinquency did not increase. • Continuous client follow-up in all markets. (*) Does not inc
Slide 88: Strategic growth of destination inventories
I N V E S T O R D A Y · F I N A N C I A L R E S U L T S 88 Strategic growth of destination inventories 97% of inventory expansion corresponds to growth of Finished Products. In Destination, growth was CLP 8,100 MM 2020 2019 36.4% 42.4% 57.6% 63.6% CLP 56,260 MM CLP 67,471 MM Productive Productivas I
Slide 89: Speed and reliability for client
I N V E S T O R D A Y · F I N A N C I A L R E S U L T S 89 Key factors: SPEED and RELIABILITY for CLIENT • Fast and timely response to changes in demand: 4 vs. 60 days • Close relationship with client • Elimination of port and customs uncertainty
Slide 90: Capex focus on Profitability and Growth
I N V E S T O R D A Y · F I N A N C I A L R E S U L T S 90 Capex (in CLP MM) – Focus on Profitability and Growth 60,000 55,648 14% 50,000 43,415 19% 40,000 15% 29,510 8% 32,463 30,000 9% 15% 33% 25% 4% 9% 20,000 36% 32% 52% 10,000 34% 51% 44% 0 2017 2018 2019 2020 Agriculture Agrícola Oenology Enoló
Slide 91: Key factors: Agricultural
I N V E S T O R D A Y · F I N A N C I A L R E S U L T S 91 Key factors: Agricultural • 44% A major part of investment, on average 44%, is in the Agricultural Area, where the Company has great advantages and knowledge, and which continue to grow year after year based on the results of constant resear
Slide 92: Key factors: Productivity
I N V E S T O R D A Y · F I N A N C I A L R E S U L T S 92 Key factors: Productivity • Results to date show a productivity increase in yield per hectare of +30% while maintaining quality (clonal vs. massal planting). The effects of project Plant 2.0 are not yet considered. • In winemaking, there is
Slide 93: Financial Strength
I N V E S T O R D A Y · F I N A N C I A L R E S U L T S 93 4. Financial Strength: • Reduction of net financial debt • Lower Debt level relative to size of Equity • Substantial improvement in Debt vs. cash flow generation
Slide 94: Lower financial debt
I N V E S T O R D A Y · F I N A N C I A L R E S U L T S 94 Lower financial debt: Financial strength A reduction of CLP 65,526 million Net Financial Debt in CLP MM 300,000 250,000 266,898 -24.6% 250,413 200,000 221,101 201,372 150,000 100,000 50,000 - 2017 2018 2019 2020 *Net Financial Debt is: Debt
Slide 95: Lower debt level relative to Equity
I N V E S T O R D A Y · F I N A N C I A L R E S U L T S 95 Lower debt level relative to Equity: Financial Strength Net Debt Ratio (Net Financial Liabilities / Equity) 1.40 1.20 1.2 1.00 0.80 0.60 -33.3% 0.40 0.54 0.47 0.49 0.20 0.36 - 2017 2018 2019 2020 *Net Financial Liabilities is: Other Current
Slide 96: Debt vs. Cash Flow generation
I N V E S T O R D A Y · F I N A N C I A L R E S U L T S 96 Substantial improvement in Debt vs. Cash Flow generation: Financial Strength EBITDA/Financial cost Other Net Financial Liabilities Net of Cash/ EBITDA 12.00 3.50 3.29 10.00 9.63 2.99 3.06 3.00 8.64 8.51 2.5 8.00 7.39 2.50 13.2% 2.00 6.00 1.5
Slide 97: Sustainability
Presentation Valentina Lira – Sustainability Manager 2021 Sustainability
Slide 98: Achievements and Challenges for the New Decade
C O R P O R AT E S U S TA I N A B I L I T Y Achievements and Challenges for the New Decade
Slide 99: Create sustainable value in every bottle
99 VIÑA CONCHA Y TORO TRES ORÍGENES, UN PROPÓSITO “Create sustainable value in every bottle of wine we place in your hands.”
Slide 100: Sustainability Strategy
I N V E S T O R D A Y · S U S T E N T A B I L I D A D C O R P O R A T I V A 100 Sustainability Strategy 10 years incorporating a strategic vision 2012-2015 2016-2020 2021-2025 FIRST CY CLE SECO ND CY CLE T HIRD CY CLE Strategy developed in 2011 is Alignment with U.N. Sustainable Challenges for the n
Slide 101: Six pillars, 95% achievement
I N V E S T O R D A Y · S U S T E N T A B I L I D A D C O R P O R A T I V A 101 Sustainability Strategy The Sustainability Strategy is based on six pillars (product, supply chain, clients, people, society and PRODUCT SUPPLY CHAIN CLIENTS environment) that are transformed into various initiatives. Ea
Slide 102: Our Environment
102 STRATEGIC PILLAR Our Environment
Slide 103: Responsible Water Use
I N V E S T O R D A Y · S U S T E N T A B I L I D A D C O R P O R A T I V A 103 Responsible Water Use • First vineyard in the world to measure its water footprint. Water footprint • Over 10 thousand hectares with drip irrigation system reduction of 17% (100% of the surface). (+7% above proposed goal
Slide 104: Responsible Water Use
I N V E S T O R D A Y · S U S T E N T A B I L I D A D C O R P O R A T I V A 104 Responsible Water Use Goal 2025 SATELLITE PRECISION AGRICULTURE “Zero Water Waste” Satellite monitoring of soil moisture to determine the specific needs of each vineyard, avoiding water waste. Satellite images of vineyar
Slide 105: Climate Change
I N V E S T O R D A Y · S U S T E N T A B I L I D A D C O R P O R A T I V A 105 Climate Change Carbon footprint -65% reduction of 32% Compared to industry • Carbon footprint measurement since 2007. (+2% above proposed goal) average • Carbon footprint is measured annually and verified externally. GHG
Slide 106: Climate Change
I N V E S T O R D A Y · S U S T E N T A B I L I D A D C O R P O R A T I V A 106 Climate Change DIRECT EMISSIONS 2020 (% Share) Our emissions come from 2 Electricity main sources Mobile sources 36 CO2 Land use thousand ENERGY We have 100% Renewable Electricity energy and are moving towards tons indep
Slide 107: Climate Change
107 Climate Change In 2020 we reached the emissions target proposed for 2022. EMISSIONS REDUCTION TRAJECTORY 2017 - 2020 (CO2e thousands of tons) Goal Goal Goal
Slide 108: Climate Change
I N V E S T O R D A Y · S U S T E N T A B I L I D A D C O R P O R A T I V A 108 Climate Change GOAL 2025 35% In 2018, Viña Concha y Toro was the first company in Chile and Latin America to set its emissions reduction targets based on climate science. Commitment to achieve zero absolute emissions by
Slide 109: Climate Change
I N V E S T O R D A Y · S U S T E N T A B I L I D A D C O R P O R A T I V A 109 Climate Change Incorporating climate risk to financial analysis The Company incorporates a gap analysis in its policies, practices and disclosures regarding the Task Force on Climate-related Financial Disclosures (TCFD).
Slide 110: Transparency
110 Transparency World-class standards for voluntary disclosure UN SDG GRI Global Reporting Initiative “Communication on Progress in GRI Report” SBT CDP Science Based Targets Initiative Climate Change, Water, Supply Chain Engagement DJSI TCFD Cuestionario ESG Task Force on Climate-related Financial
Slide 111: Performance
111 Performance Global Rankings and Ratings with high ESG S&P Global MSCI DOW JONES SUSTAINABILITY INDEX ESG Ratings (A) Chile (74 pts) Against standard version Beverages Industry Emerging Markets (since 2016) ESG Rating Model. MILA Pacific Alliance (since 2017) Member of Sustainability Yearbook 202
Slide 112: Reporting
112 Reporting HALLBARS SUSTAINABILITY AWARDS (SWEDEN) 3rd Place Best In The World 2020 1st Place Best In Latin America 2020 hallbars.org SUSTAINABILITY REPORT 2020 Available May 2021
Slide 113: We seek to become a benchmark beyond the wine industry
113 We seek to become a benchmark, beyond the wine industry.
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