26 slides from Anadolu Efes Biracilik Ve Malt Sanayii A.s's earnings presentation, Mar 3, 2017
Slide 1: FY2016 Conference Call Presentation
v FY2016 CONFERENCE CALL PRESENTATION March 3, 2017
Slide 2: Forward-Looking Statements
FORWARD-LOOKING STATEMENTS This presentation may contain certain forward-looking statements concerning our future performance and should be considered as good faith estimates made by the Company. These forward-looking statements reflect management expectations and are based upon currently available
Slide 3: General Overview & Operating Environment
GENERAL OVERVIEW & OPERATING ENVIRONMENT
Slide 4: Key Highlights on Consolidated Performance – FY2016
Key Highlights on Consolidated Performance – FY2016 Volume up 4.5% in 4Q2016 vs. 4Q2015 and up 1.5% in FY2016 vs. FY2015 Strong performance of soft drinks and international beer operations Revenue up 10.8% in 4Q2016 and up 2.1% in FY2016 outperforming volume growth ; Higher volumes assisted by i
Slide 5: Consolidated Performance – FY2016
Consolidated Performance – FY2016 SALES VOLUME NET SALES REVENUE EBITDA (BNRI) & EBITDA Margin 17.3% 17.0% mn TL mn TL mhl 86.1 87.5 10,205.1 10,420.3 1,766.1 1,771.9 2015 2016 2015 2016 2015 2016 BREAKDOWN* 7% 14% 22% 16% 18% 60% 18% 68% 77% Turkey Beer International Beer Soft Drinks 5 *Breakdowns
Slide 6: Soft Drinks Volume Development – FY2016
Soft Drinks Volume Development – FY2016 Volume Breakdown by Country* %3.2 1,151.9 1,189.1 Others 8% Iraq *Breakdown is on a combined basis 8% 558.9 588.0 Kazakhstan m u/c 8% Turkey 51% 593.0 601.1 Pakistan 25% 2015 2016 Turkey International Turkey delivered 1.4% volume growth in FY2016 Sales vol
Slide 7: Beer Volume Development – FY2016
Beer Volume Development – FY2016 Total beer group sales volume at 19.9 mhl 20.7 19.9 Russian beer market performed above expectations on the 14.1 back of; 13.9 mhl Improving consumer sentiment with a recovering economy 6.6 6.0 Postponement of PET regulations 2015 2016 Turkey Beer International B
Slide 8: Turkey Beer Operations – FY2016
Turkey Beer Operations – FY2016 SALES VOLUME MARKET SHARE* Other; 0.1% Tuborg 6,6 33.3% Efes Turkey 6,0 66.6% 2015 2016 Turkey beer market was down by low single digits in FY2016 vs FY2015 The slowdown in the rate of decline continued in 4Q as a result of our strategy of; Building brands by in
Slide 9: International Beer Operations – FY2016
International Beer Operations – FY2016 EFES RUSSIA MARKET SHARE* Efes RUSSIA 14.1 13.9 Efes RUSSIA 15% 14% Carlsberg Carlsberg 34% 33% 2015 2016 Inbev Inbev EBI volumes grew by 0.8% excluding Ukraine 13% 13% Heineken Heineken Russian beer market was down by 2.2%* in FY2016 while Efes Rus 12% 12%
Slide 10: Beer Group Strategy
BEER GROUP STRATEGY BRANDS Provide choice and innovation to consumers: Grow brand love E XECUTION Excell in customer collaboration availability and point of sale activation E FFICIENCY Build competitive advantage through lean and efficient operations RELATIONS Focus on employees, customers, regulato
Slide 11: Financial Overview
FINANCIAL OVERVIEW
Slide 12: Anadolu Efes Consolidated Performance – FY2016
Anadolu Efes Consolidated Performance – FY2016 ANADOLU EFES CONSOLIDATED (TL mn) FY2015 FY2016 Change (%) Volume (mhl) 86.1 87.5 1.5% Net Sales 10,205.1 10,420.3 2.1% Gross Profit 4,186.7 4,090.6 -2.3% EBIT (BNRI) 948.5 943.1 -0.6% EBITDA (BNRI) 1,766.1 1,771.9 0.3% Net Income** -197.8 -70.8 64.2% M
Slide 13: Beer Group Performance – FY2016
Beer Group Performance – FY2016 TURKEY BEER INTERNATIONAL BEER BEER GROUP (TL mn) (USD mn) (TL mn) FY2016 vs FY2015 FY2016 vs FY2015 FY2016 vs FY2015 Volume (mhl) 6.0 -9.9% 13.9 -0.9% 19.9 -3.8% Net Sales 1,438.6 -3.1% 630.6 -13.0% 3370.1 -3.2% Gross Profit 853.5 -6.0% 275.4 -20.3% 1708.1 -8.3% EBIT
Slide 14: Beer Free Cash Flow – FY2016
Beer Free Cash Flow – FY2016 Beer Group Free Cash Flow (TL mn) FY2015 FY2016 EBITDA 694.9 675.9 Change in Working Capital 162.9 -4.4 Income Taxes & Employee Benefits Paid -81.2 -71.3 CAPEX, net -251.9 -202.0 Net Financial Income /(Expense) 26.6 -21.9 FCF 551.3 376.3 Other investing activities (Acq.,
Slide 15: Balance Sheet Flexibility: Net Debt / EBITDA
BALANCE SHEET FLEXIBILITY ◉ 2016YE Net Leverage Ratios are within comfortable area Anadolu Efes Consolidated Beer Group Net Leverage Ratio:Net Debt / EBITDA (BNRI) 2.0 ◉ 69% of cash is hold as hard ◉ 69% of cash is hold as hard times times 1.9 currency 1.7 currency 1.6 ◉ 97% of debt is in hard ◉ 100
Slide 16: Borrowing Mix & Liquidity Profile: Maturity Schedule
BORROWING MIX & LIQUIDITY PROFILE ◉ Easily manageable debt repayment schedule ◉ Average maturity of debt for Beer Group is app. 4.8 years and Anadolu Efes is app. 3.3 years 757 704 500 500 Maturity Schedule* BEER 151 134 108 120 120 CCI 99 88 AEFES 53 53 43 35 35 2017 2018 2019 2020 2021 2022 20
Slide 17: Interest Breakdown
INTEREST BREAKDOWN ◉ Significant portion of debt is fixed, minimized interest rate risk ANADOLU EFES BEER GROUP Floating : 25% Floating : 23% Floating : 21% Floating : 13% Fixed : 75% Fixed : 77% Fixed : 79% Fixed : 87% FY2015 FY2016 FY2015 FY2016 17
Slide 18: Financial Income/(Expense) Breakdown – FY2016
Financial Income/(Expense) Breakdown – FY2016 Financial Income / (Expense) Breakdown FY2015 FY2016 Interest income 81.6 81.1 Interest expense -220.1 -211.6 Foreign exchange gain /(loss) -842.2 -641.0 Other financial expenses (net) -27.4 -26.5 Gain/(loss) on derivative transactions -0.7 -4.2 Net Fina
Slide 19: Anadolu Efes Consolidated Free Cash Flow – FY2016
Anadolu Efes Consolidated Free Cash Flow – FY2016 Anadolu Efes Free Cash Flow (TL mn) FY2015 FY2016 EBITDA 1,746.5 1,768.7 Change in Working Capital 152.2 172.5 Income Taxes & Employee Benefits Paid -157.5 -133.4 CAPEX, net -1,058.2 -707.8 Net Financial Income /(Expense) -45.2 -69.6 FCF 637.8 1,030.
Slide 20: Financial Priorities
FINANCIAL PRIORITIES ◉ Sustain consolidated cash flows through; ◉ Efficiency improvements via savings focus on working capital optimization ◉ Managing impact of F/X volatility on operations optimized capex policy ◉ Commitment to Investment Grade Ratings sticking to tight balance sheet manageme
Slide 21: Closing Remarks
CLOSING REMARKS
Slide 22: Long Term Key Priorities
LONG TERM KEY PRIORITIES Continue to generate value by margin improvement and FCF generation through our priorities ◉ Capitalizing on our strong brand portfolios Beer ◉ Achieving optimal brand & SKU mix ◉ Excelling in execution ◉ Focusing on quality market share ◉ Strong cash flow generation with sp
Slide 23: 2017 Guidance
2017 GUIDANCE Sales Volume: Low-to-mid single digit growth on a consolidated basis • Total Beer: low single digit growth • Turkey beer: flattish vs a flattish market • Russian beer: outperformance of flattish beer market Consolidated Soft Drinks: mid-single digit growth • Turkey soft drinks: low-sin
Slide 24: Q&A Session
ANADOLU EFES
Slide 25: Appendix
ANADOLU _EFES
Slide 26: FX Rates
FX RATES FY2015 FY2016 Δ% AVG 2.72 3.02 11.0% USD/TL PE 2.91 3.52 21.0% AVG 3.02 3.34 10.6% EUR/TL PE 3.18 3.71 16.8% AVG 60.96 67.03 10.0% USD/RUB PE 72.88 60.66 -16.8% AVG 221.73 342.16 54.3% USD/KZT PE 339.47 333.73 -1.7% AVG 21.81 25.59 17.3% USD/UAH PE 24.00 27.19 13.3% AVG 18.82 19.92 5.9% USD