Chocoladefabriken Lindt & Spruengli Ag · SIX:LISN
Chocoladefabriken Lindt & Spruengli — Lindt & Sprüngli — FY2022 Earnings Presentation
52 slides from Chocoladefabriken Lindt & Spruengli's earnings presentation, Mar 7, 2023
Slide 1: Slide 1
Slide 2: Slide 2
Slide 3: Financial Year 2022
Financial Year 2022 Adalbert Lechner Group CEO March 7, 2023
Slide 4: Key Figures & Market Trends
01 Key Figures & Market Trends 02 Market Insights & Highlights 03 Financial Results 2022 04 Sustainability 05 Growth Agenda & Outlook 06 Q&A
Slide 5: Key Figures
+10.8% +17.9% Organic sales growth Increase in earnings +8.4% in CHF per share to CHF 2,416 4.97 bn Group sales (CHF) Key Figures Lindt & Sprüngli 15.0% 1,300 CHF achieved double-digit EBIT margin Dividend +8.3% vs. PY growth in FY 2022 CHF 745 mn 10.6% Free Cash Flow margin 5 CHF 526 mn
Slide 6: Global Chocolate Markets and Trends in 2022
Global Chocolate Markets and Trends in 2022 Global chocolate markets Geopolitical situation, continue to grow Energy Crisis & Inflation Trends Consumers longing for the comfort of a + Regional differences impacting + Premium chocolate premium treat: Quality over Quantity European markets: consumers
Slide 7: Market Insights & Highlights
Market Insights & Highlights
Slide 8: Total Group Sales CHF 4.97 bn
4.97 0. 5 3 b n 1 24 TOTAL GROUP SALES CHF +10.8% organic growth 8
Slide 9: Sales Analysis Markets
40.8% REST OF THE WORLD NORTH AMERICA Sales Analysis + + EUROPE Markets 13.0% Lindt & Sprüngli achieves + strong double-digit growth to CHF 4.97 bn, an increase of 8.4% in CHF 46.2% 9
Slide 10: Europe Market Split
46.2% Largest region in the Group 2.30 bn REST OF THE WORLD NORTH AMERICA Market Split Total sales in CHF + EUROPE Europe +5.3% 40.8% organic growth 14.8% 5.6% Germany Italy 8.2% 3.7% France CH (excl. DIS and GTR) 13.0% 6.3% 7.6% UK Rest of Europe 10
Slide 11: Europe Key Facts
Sales Growth in all markets (organic) Switzerland Germany Italy UK (+7.1%) (+6.1%) (+6.4%) ( +5.5%) France Iberia Austria Nordics (+2.6%) (+9.3%) (+7.2%) (+11.7%) REST OF THE WORLD NORTH AMERICA Key Facts 1 Strong seasonal performance of Lindor EUROPE Europe Post–Covid changes: increase in gifting p
Slide 12: North America Market Split
40.8% 2nd largest region in the Group 2.03 bn REST OF THE WORLD Total sales in CHF NORTH AMERICA Market Split North EUROPE +15.7% America organic growth 40.8% 34.8% 5.5% 0.5% USA Canada Mexico 13.0 12
Slide 13: North America Highlights
Strong double-digit growth across all subsidiaries Lindt USA Ghirardelli Russell Stover (+21.4%) (+13.9%) (+10.2%) Canada Mexico ( +14.4%) (+19.3%) REST OF THE WORLD NORTH AMERICA Highlights 1 Significant increase on EBIT-Level: 7.7% to 10.9% EBIT-Margin (rise by 320 bp) EUROPE North Significant inv
Slide 14: Rest of the World Market Split
13% 3rd largest region REST OF THE WORLD in the Group NORTH AMERICA Market Split Rest of the 0.65 bn EUROPE Total sales in CHF world 40.8% +16.6% organic growth 14
Slide 15: Rest of the World Highlights
High-potential markets with strong growth Global Travel Brazil China Japan Retail (+109%) (+41.4%) (+18.3%) (+10.0%) REST OF THE WORLD NORTH AMERICA Highlights 1 Global Travel Retail: Strong rebound following return of global tourism; quick reaction by supply chain EUROPE Rest of 40 the World 2 Chin
Slide 16: Slide 16
Slide 17: Global Retail
Global Retail (NTS reported in countries) +21.6% Lindt shops provide unique brand building opportunity Sales growth Providing seamless shopping experience to consumers across all channels 500 New e-shop platform optimizing Physical shops in + user experience 19 countries Trend for personalization an
Slide 18: Financial Results 2022
Financial Results 2022 Martin Hug Group CFO
Slide 19: Overview – Year 2022
15.0% 14.1% 2’416 13.3% 12.8% 2’049 10.8% 10.6% Overview – Year 2022 571 Key performance 295 indicators continue to develop positively 2021 2022 2021 2022 2021 2022 2021 2022 2021 2022 Organic EBIT Free CF Earnings Net debt growth margin margin per share position (CHF) (CHF million) 19
Slide 20: Shareholder Return
2018 2019 2020 2021 2022 Ordinary dividend 1,000 1,050 1,100 1,200 1,300* reg. (CHF) Shareholder Special dividend - 700 - - - Return (CHF) Increase in shareholder Dividend yield reg. 1.4% 2.0% 1.2% 1.0% 1.4% return continues Payout ratio 50.0% 83.2% 82.5% 59.3% 54.6% Share buyback (CHF million) 120
Slide 21: Share Price & Market Capitalization
Registered shares (at year-end in CHF) Market capitalization (CHF million) 122’200 95’000 Share Price & 85’500 88’400 Market 73’300 Capitalization 30’035 22’679 19’688 20’994 16’518 2018 2019 2020 2021 2022 21
Slide 22: Organic Sales Growth
2022 10.8% 2021 13.3% Organic Sales Growth 2020 -6.1% (in %) 2019 6.1% 2018 5.1% 22
Slide 23: Sales Growth in CHF
Absolute in CHF million (as published) Growth rate in % (as published) 4’970 4’509 4’585 4’313 4’017 Sales Growth 14.2% in CHF 8.4% 5.5% 4.5% Sales reaching a new record high -10.9% close to CHF 5 billion 2018 2019 2020 2021 2022 23
Slide 24: Sales: Growth Factors
Growth rate in % 8.2% 10.8% 2.4% 8.4% Sales: Growth Factors Organic growth of 10.8% driven by Price / Mix 2.6% Volume Price / Mix Organic Forex Sales in CHF 24
Slide 25: Sales Analysis: Segment Information
Growth rate in % (organic) Absolute in CHF million (as published) Europe North America Rest of the World 19.7% 568 Sales Analysis: 15.7% 16.6% Segment 13.8% 2,029 646 Information 2,329 10.7% 1,688 5.3% 2,296 2021 2022 2021 2022 2021 2022 25
Slide 26: Material Costs incl. Change in Inventories
Absolute in CHF million Ratio in % to sales 1’678 Material Costs 1’518 1’518 incl. Change in Inventories 1’434 1’422 Higher milk, sugar and packaging prices 35.3% driving material costs 33.6% 33.8% 33.1% 33.1% 2018 2019 2020 2021 2022 26
Slide 27: Cocoa Price
Cocoa Price Price of cocoa bean futures have been experiencing an increase in recent months 2’200 Cocoa bean prices in GBP/t 2’100 2’000 1’900 Chart does not include LID (USD 400/mt) which the 1’800 Lindt & Sprüngli Group has 1’700 paid since its introduction in October 2020 1’600 1’500 Apr. 21 Sep.
Slide 28: Personnel Expenses
Absolute in CHF million Ratio in % to sales 1’008 986 979 Personnel 938 Expenses Economies of scale leading 885 to improved cost ratio 21.8% 21.7% 22.0% 21.5% 20.3% 2018 2019 2020 2021 2022 28
Slide 29: Operating Expenses
Absolute in CHF million Ratio in % to sales 1’295 1’191 1’144 1’113 1’036 Operating Expenses 26.5% Maintaining high advertising 25.9% 26.0% 26.0% investments despite increasing supply chain costs 24.7% 2018 2019 2020 2021 2022 29
Slide 30: Depreciation and Impairments
Depreciation and Impairments Slight decrease in percentage of sales driven by economies of scale Absolute in CHF million 323 Ratio in % to sales 76 276 277 273 70 77 75 247 206 200 198 180* 7.2% 6.9% 6.0% 5.5% 4.2% 2018 2019 2020 2021 2022 30 *2018 disclosed at old leasing standard
Slide 31: Operating Profit (EBIT)
Operating Profit (EBIT) EBIT-margin improved by 90 bp despite significant headwinds Absolute in CHF million Margin in % to sales 745 637 645 593 420 14.8% 13.2% 14.1% 15.0% 10.5% 2018 2019 2020 2021 2022 31
Slide 32: EBIT by Segment
EBIT-margin in % Absolute in CHF million Europe North America Rest of the World 18.2% 17.8% 17.8% EBIT by 425 409 16.0% 115 Segment 91 10.9% Strong increase of 221 profitability in North America 7.7% 129 2021 2022 2021 2022 2021 2022 32
Slide 33: EBITDA
EBITDA Achieving record levels, exceeding CHF 1 billion for the first time Absolute in CHF million Margin in % to sales 1’018 916 921 816 696 20.3% 20.1% 20.5% 18.9% 17.4% 2018 2019 2020 2021 2022 33
Slide 34: Free Cash Flow
Free Cash Flow Strong Free Cash Flow despite higher inventories Absolute in CHF million Margin in % to sales 596 585 539 526 394 13.2% 13.4% 12.8% 10.6% 9.1% 2018 * 2019 2020 2021 2022 34 *2018 free Cash Flow before changes due to new leasing reporting
Slide 35: Capital Expenditure
Absolute in CHF million 257 249 Capital 241 Expenditure 235 Continued investments into 230 growth and efficiency 2018 2019 2020 2021 2022 35
Slide 36: Tax Rate
Tax Rate Tax rate in line with 2021 2018 2019* 2020* 2021 2022 21.5% 21.1% 21.0% 18.8% 8.8% In % of income before taxes 36 * extraordinary positive effects
Slide 37: Net Income
Net Income Back to pre-Covid levels Absolute in CHF million Margin in % to sales 570 487 512 491 320 11.5% 11.3% 11.4% 10.7% 8.0% 2018 2019 2020 2021 2022 37
Slide 38: Non-diluted Earnings per Share
Absolute in CHF 2’416 2’142 2’021 2’049 Non-diluted Earnings 1’333 per Share* Substantial increase of EPS 2018 2019 2020 2021 2022 38 * equivalent to 10 Participation Certificates
Slide 39: Net Financial Position
Net Financial Position Slight increase in net debt despite share buyback - mainly driven by strong Free Cash Flow generation Free Cash Flow = 526 + Absolute in CHF million -230 +756 Shareholder return = 835 -284 + -295 -551 -571 -50 +83 01/01/2022 Operating CAPEX Dividend Share buyback Capital incre
Slide 40: Equity Ratio
In % of total assets 57.8%* 58.1% 57.2% 58.3% 55.4% Equity Ratio Strong balance sheet 0 2018 2019 2020 2021 2022 40 *2018 adjusted for leasing impact for comparability reasons
Slide 41: Sustainability
og LINDT & SPRUNGLI Sustainability
Slide 42: The Lindt & Sprüngli Sustainability Plan
Our Sustainability Plan centers around Lindt & Sprüngli’s focus areas Delighting Improving grouped under four pillars Consumers Livelihoods and objectives: Transparent and responsible Rural development communication Responsible Sourcing • improve the livelihoods of people in our supply Product quali
Slide 43: Sustainability Highlights
100% of cocoa sourced from farming households Complete 100% covered by Child Labor Carbon Monitoring and Remediation System Footprint (CLMRS) by 2025 of our cocoa beans and 64% of cocoa calculated (Scopes 1, 2, and 3) and our science- Tackling child bean equivalents, sourced through based targets (S
Slide 44: Lindt & Sprüngli Farming Program
Four pillars of the Program based on a Theory of Change 1 Tracing our beans 2 Training the farmers 3 Investments for farmers and communities Lindt & Sprüngli 4 Independently verifying our Program Farming Program + The Lindt & Sprüngli Farming Program aims to create decent and resilient Objectives li
Slide 45: Our pathway to Science Based Targets (SBT)
Committed to define an MAY 21 SBT with long-term goal to 2021 reach net-zero emissions Carbon footprint assessment (Scopes 1, 2, and 3) 2021 21 Continue emissions reduction actions Progress 2021: 20% reduction of Our pathway to emissions in production process per ton produced Science Based
Slide 46: Growth Agenda & Outlook
Growth Agenda & Outlook Adalbert Lechner Group CEO
Slide 47: Building on our Strengths
Building on our Strengths We have a proven recipe for success. By adapting to changing market requirements we will continue our growth story New Segments Stretch New Markets Emerging Markets Digitalization Supply chain Challenges RGM Adapt Sustainability Secondary Franchises Diversity & Inclusion Gi
Slide 48: The Lindt & Sprüngli Way to Growth
1 Growth Optimize brand support Free up funds via RGM / efficiency increase Capitalize potential of secondary franchises Strong focus behind gifting 2 Premium Nurture brand equity The Invest in quality and reputation Secure margins Lindt & Sprüngli 3 Innovation Way to Growth Enchant consumers Increa
Slide 49: Outlook
Financial Year Medium to → 2023 long term Outlook 6-8% 6-8% Lindt & Sprüngli will continue to grow stronger than the market Organic sales growth Expected sales growth 20-40 20-40 Operating profit margin Continuous improvement of 20-40 basis points operating profit margin of above 2022 20-40 basis po
Slide 50: Q&A
Q&A
Slide 51: Slide 51
Slide 52: Disclaimer
Disclaimer This presentation contains forward-looking statements which reflect the management’s current views and estimates. The forward-looking statements involve certain risks and uncertainties that could cause actual results to differ materially from those contained in the forward-looking stateme