Treasury Wine Estates Limited · ASX:TWE
Treasury Wine Estates — H1 2018 Earnings Presentation
23 slides from Treasury Wine Estates's earnings presentation, Jan 31, 2018
Slide 1: Interim 2018 Results
For personal use only TREASURY WINE ESTATES Interim 2018 Results 31 January 2018
Slide 2: Michael Clarke, Chief Executive Officer
Michael Clarke For personal use only Chief Executive Officer 2
Slide 3: Result headlines
Result headlines1,2,3 • For personal use only Reported Net Profit After Tax4 of $187.2m; up 37% • Reported Earnings Per Share (EPS) of 25.6 cents per share; up 38% • EBITS5 of $283.3m, 25% higher than 1H17 EBITS • All regions delivered EBITS and EBITS margin growth in 1H18 • Group EBITS margin up 4.
Slide 4: Announcing US route-to-market improvements
Announcing US route-to-market improvements For personal use only • Transformational changes to US route-to-market to strengthen long-term outlook Leverages TWE’s global competency of directly managing relationships with retail partners Better positions TWE to collaborate with retail partners to
Slide 5: Brand and marketing highlights in 1H18: Luxury brands recognition
Brand and marketing highlights in 1H18 Recognition for TWE’s Luxury brands For personal use only 100 points 97 points 95+ points 93 points Robert Parker’s Robert Parker’s Robert Parker’s James Suckling Wine Advocate Wine Advocate Wine Advocate 5 5
Slide 6: Growing the 19 Crimes brand globally
Brand and marketing highlights in 1H18 Growing the 19 Crimes brand globally For personal use only Expanding product range into new markets, leveraging stand-out success in the US + 131%1 + 111%1 + 50%2 + 44%1 19 Crimes The Warden The Banished Hard Chard The Uprising 1. Retail sales volume growth by
Slide 7: Leading edge digital marketing
Brand and marketing highlights in 1H18 Leading edge digital marketing For personal use only Living Wine Labels; connecting with different consumer groups through augmented reality 7 7
Slide 8: Gunther Burghardt, Chief Financial Officer
Gunther Burghardt For personal use only Chief Financial Officer 8
Slide 9: Profit & Loss
Profit & Loss1 EBITS growth and regional contribution Historical EBITS and EBITS margin2 For personal use only A$m $283.3m 5 8. 7m +$ $224.6m 100.4 88.6 117.0 79.4 54.0 68.2 23.7 24.0 (21.1) (26.3) 1H17 1H18 Europe ANZ Asia Americas Corporate Strong 1H18 result delivered sustainably, with all region
Slide 10: Balance Sheet
Balance Sheet1,2 Flexibility to pursue future value accretive opportunities For personal use only A$m 1H18 F17 1H17 Cash & cash equivalents 202.5 240.8 339.9 • Net assets down $171.1m on a reported currency basis; Receivables 662.1 607.9 622.3 adjusting for movements in foreign currency, the decreas
Slide 11: Cash flow and net debt
Cash flow and net debt1 Robust cash conversion; in line with TWE’s target Continued investment in a quality, sustainable asset base For personal use only A$m 1H18 1H17 IT spend 8.0 2.9 Oak purchases 16.4 15.7 Vineyard redevelopments 10.1 9.7 Upgrades to winemaking equipment and facilities 9.1 4.4 Ot
Slide 12: Inventory analysis
Inventory analysis Premium inventory balance to support earnings and For personal use only Inventory at book value split by segment1,2,3 margin growth in F19 and beyond • Total inventory increased $141.2m to $1,713.7m, reflecting: − $17.0m increase in non-current inventory − $124.2m increase in curr
Slide 13: Regional presenters and Summary & Outlook
Robert Foye | Chief Operating Officer and President Americas Peter Dixon | Managing Director North Asia and Global Travel Retail For personal use only Tim Ford | Managing Director, Europe, SEAMEA & Global Supply Chain Angus McPherson | Managing Director, ANZ Michael Clarke | Summary & Outlook 13
Slide 14: Americas
Americas Americas regional performance1 Historical EBITS & EBITS margin performance2 For personal use only A$m A$m 1H18 1H17 % 1H17 % Reported currency Constant currency Volume (m 9Le) 7.3 8.1 (9.8)% 8.1 (9.8)% NSR (A$m) 503.8 576.6 (12.6)% 562.5 (10.4)% NSR per case (A$) 69.15 71.39 (3.1)% 69.64 (0
Slide 15: Asia
Asia Asia regional performance Historical EBITS & EBITS margin performance1 For personal use only A$m A$m 1H18 1H17 % 1H17 % Reported currency Constant currency Volume (m 9Le) 2.4 1.7 43.6% 1.7 43.6% NSR (A$m) 297.5 218.1 36.4% 217.8 36.6% NSR per case (A$) 125.16 131.77 (5.0)% 131.59 (4.9)% EBITS (
Slide 16: Europe
Europe Europe regional performance1 Historical EBITS & EBITS margin performance2 For personal use only A$m A$m 1H18 1H17 % 1H17 % Reported currency Constant currency Volume (m 9Le) 4.5 4.8 (7.6)% 4.8 (7.6)% NSR (A$m) 160.2 177.2 (9.6)% 178.2 (10.1)% NSR per case (A$) 35.90 36.69 (2.2)% 36.89 (2.7)%
Slide 17: Australia & New Zealand
Australia & New Zealand ANZ regional performance Historical EBITS & EBITS margin performance1 For personal use only A$m A$m 1H18 1H17 % 1H17 % Reported currency Constant currency Volume (m 9Le) 4.3 4.2 3.2% 4.2 3.2% NSR (A$m) 333.9 322.8 3.4% 321.6 3.8% NSR per case (A$) 77.45 77.25 0.3% 76.97 0.6%
Slide 18: Summary and outlook
Summary and outlook For personal use only • TWE’s top priority across all our regions, is building collaborative relationships with key customers • Diageo Wine integration now complete • US route-to-market changes expected to enhance competitive positioning and drive portfolio growth − Transition no
Slide 19: Questions
For personal use only Questions 19
Slide 20: Disclaimer
Disclaimer For personal use only Summary information The material in this presentation is summary information about Treasury Wine Estates Limited (TWE) and its subsidiaries and their activities, current as at the date of this presentation unless otherwise stated. It should be read in conjunction wit
Slide 21: Supplementary Information
Supplementary For personal use only Information 21
Slide 22: Impact of foreign exchange rate movements & hedging
Impact of foreign exchange rate movements & hedging 1H18 constant currency impact 2H18 EBITS sensitivity and risk management For personal use only CFX Impact (A$m) Currency Primary EBITS Movement Currency Underlying Hedging2 Total Pair Exposure Sensitivity (A$m) AUD/USD and AUD/GBP (4.4) 0.4 (4.0) A
Slide 23: Definitions
Definitions For personal use only Term Definition Throughout this presentation, constant currency assumes current and prior period earnings of foreign Constant currency operations are translated and cross border transactions are transacted at current year exchange rates NSR Net sales revenue EBITDAS
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