Scandinavian Tobacco Group A/s · OMXCOP:STG
Scandinavian Tobacco Group A/s — Q1 2019 Earnings Presentation
25 slides from Scandinavian Tobacco Group A/s's earnings presentation, May 23, 2019
Slide 1: Investor Presentation First Quarter 2019
INVESTOR PRESENTATION FIRST QUARTER 2019 23 MAY 2019
Slide 2: Agenda
AGENDA 1. Quarterly Highlights 2. New Reporting Structure and IFRS 16 3. The divisions 4. Financials 5. Guidance 2019 6. Q&A This presentation contains forward-looking statements. All statements other than statements of historical fact included in the presentation are forward-looking statements. For
Slide 3: Quarterly Highlights
QUARTERLY HIGHLIGHTS Guidance unchanged Organic EBITDA growth with >5% organic growth of 7.3% in EBITDA FtG progressing well. New reporting structure introduced 3
Slide 4: Q1 2019 Financial Highlights
Q1 2019 FINANCIAL HIGHLIGHTS Q1 2019 DKK 1,464 million Net sales (organic growth -1.6%) DKK 239 million EBITDA before special items (organic growth 7.3%) Free cash flow before DKK 72 million acquisitions DKK 6.00 Dividend per share Approved at AGM, April 10 4
Slide 5: Impact from Accounting Changes in 2019
IMPACT FROM ACCOUNTING CHANGES IN 2019 Change Impact on comparison Operational leasing will going forward be IFRS 16 treated a financial leasing Historical numbers will not be restated Figures will be presented at divisional level New Historical numbers will be restated rather than category level an
Slide 6: New Reporting Structure
NEW REPORTING STRUCTURE FROM CATEGORIES TO DIVISIONS FULL YEAR 2018 DKK million NAO&R NAB Region Region Group MMC ST&A Net sales Handmade cigars 27% 8% 1% 0% 35% Machine-made cigars 2% 5% 20% 8% 35% Pipe tobacco 1% 2% 1% 3% 7% Fine-cut tobacco 0% 2% 1% 6% 8% ACM 2% 2% 3% 8% 14% Group 31% 19% 25% 25%
Slide 7: New Reporting Structure: FY 2018 EBITDA and Margin by Division
NEW REPORTING STRUCTURE FY 2018 EBITDA AND MARGIN BY DIVISION Note: EBITDA and EBITDA margins are before special items
Slide 8: Fuelling the Growth
FUELLING THE GROWTH UPDATE ORGANISATION COMMERCIAL RESOURCES • FTE/net sales ratio • Four divisions anchored in Executive Board • Organisational layers from 10 to 7 • Customer service level • 100-120 white collar positions • Market shares in selected markets • Number of active customers in online/ca
Slide 9: North America Online & Retail
NORTH AMERICA ONLINE & RETAIL 9
Slide 10: North America Online & Retail
NORTH AMERICA ONLINE & RETAIL DKK million Q1 19 Q1 18 2018 2017 excl IFRS 16 excl IFRS 16 excl IFRS 16 Net sales 496 297 2,111 1,500 Gross profit 182 112 793 530 EBITDA 50 32 310 177 Net sales growth 67.3% -6.0% 40.7% 1) - Organic growth 2.4% 8.8% 6.3% Q1 2019 Gross margin 36.6% 37.6% 37.5% 35.3% •
Slide 11: North America Branded
SCANDINAVIAN TOBACCO GROUP § NORTH AMERICA BRANDED Share of Group Full year 2018 Net sales Gross profit EBITDA 35% 30% 25% 20% 15% 10% 5% 0% Divisional net sales by product category Full year 2018 Accessories & CMA Smoking tobacco Handmade cigars Machine-made cigars
Slide 12: North America Branded
NORTH AMERICA BRANDED DKK million Q1 19 Q1 18 2018 2017 excl IFRS 16 excl IFRS 16 excl IFRS 16 Net sales 257 271 1,247 1,348 Gross profit 147 151 712 783 EBITDA 45 42 242 309 Net sales growth -5.3% -11.8% -7.5% 1) - Organic growth -9.2% 1.3% -1.2% Q1 2019 Gross margin 57.4% 55.7% 57.1% 58.1% • Machi
Slide 13: Region Machine-Made Cigars
REGION MACHINE-MADE CIGARS 13
Slide 14: Region Machine-Made Cigars
REGION MACHINE-MADE CIGARS DKK million Q1 19 Q1 18 2018 2017 excl IFRS 16 excl IFRS 16 excl IFRS 16 Net sales 348 357 1,682 1,798 Gross profit 177 177 832 915 EBITDA 64 51 304 352 Net sales growth -2.6% -3.5% -6.4% 1) - Organic growth -3.3% -3.2% -6.4% Q1 2019 Gross margin 50.9% 49.6% 49.5% 50.9% •
Slide 15: Region Smoking Tobacco & Accessories
REGION SMOKING TOBACCO & ACCESSORIES 15
Slide 16: Region Smoking Tobacco & Accessories
REGION SMOKING TOBACCO & ACCESSORIES DKK million Q1 19 Q1 18 2018 2017 excl IFRS 16 excl IFRS 16 excl IFRS 16 Net sales 363 360 1,677 1,818 Gross profit 178 173 882 906 EBITDA 101 98 545 552 Net sales growth 0.7% -6.7% -7.7% - Organic growth 1) 1.6% 7.4% 1.9% Q1 2019 Gross margin 49.1% 48.0% 52.6% 4
Slide 17: Key Data
KEY DATA Q1 2019 Q1 2018 FY 2018 excl IFRS 16 excl IFRS 16 DKKm DKKm Growth, % DKKm Organic1 Net sales 1,464 1,285 14% (1.6%) 6,718 Gross profit (before special items) 684 613 12% 3,219 OPEX (ex other income) -445 -414 7% -1,915 EBITDA before special items 239 199 20% 7.3% 1,304 EBITDA margin before
Slide 18: Cash Flow Development
CASH FLOW DEVELOPMENT Q1 2019 Q1 2018 FY 2018 DKKm DKKm DKKm EBITDA before special items 239 199 1,089 Changes in working capital -89 -68 -101 Adjustments -2 -8 135 Special items, paid -26 -12 -103 Cash flow from operating activities before financial items 123 111 1,019 Financial items, net 16 -39 -
Slide 19: Capital Structure and Dividends
CAPITAL STRUCTURE AND DIVIDENDS 19
Slide 20: Guidance 2019
GUIDANCE 2019 GUIDANCE EBITDA Organic growth >5% FREE CASH FLOW >DKK 750 million BEFORE ACQUISITIONS ASSUMPTIONS FINANCIAL EXPENSES 1) DKK 70-80 million EFFECTIVE TAX RATE 21-23% SPECIAL ITEMS, NET ~DKK -85 million EXCHANGE RATES ~USD/DKK 6.50-6.60 1) Finincial expenses, excluding currency losses or
Slide 21: Scandinavian Tobacco Group
SCANDINAVIAN TOBACCO GROUP
Slide 22: Investor Relations Contact, Financial Calendar
INVESTOR RELATIONS CONTACT FINANCIAL CALENDAR Scandinavian Tobacco Group A/S 2019 Sydmarken 42 2860 Søborg 14 Annual report 2018* Denmark MAR 2019 10 Annual General Meeting APR 2019 23 First quarter 2019* MAY 2019 29 Half year report 2019* AUG Torben Sand 2019 Head of Investor Relations Tel: +45 508
Slide 23: Market Share Performance
MARKET SHARE PERFORMANCE Top 5 EU Markets: France, Belgium, Holland, UK and Spain 23
Slide 24: IFRS 16 – Material Impact on Results
IFRS 16 – MATERIAL IMPACT ON RESULTS IFRS 16 IMPACT ON KEY GROUP FIGURES, Q1 2019 DKK million Reported Impact Ex IFRS 16 EBITDA before special items 239 22 218 Free cash flow before acquisitions 72 22 50 EBITDA margin before special items 16.3% 1.4% 14.9% Net interest bearing debt 2,801 235 2,566 IF
Slide 25: Forward Looking Statements
FORWARD LOOKING STATEMENTS This presentation contains forward-looking statements. All statements other than statements of historical fact included in the presentation are forward-looking statements. Forward-looking statements give Scandinavian Tobacco Groups (“STG”) current expectations and projecti
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