East African Breweries Plc · NSEKE:EABL
East African Breweries — FY2009 Earnings Presentation
30 slides from East African Breweries's earnings presentation, Aug 28, 2009
Slide 1: EABL F09 Investor Group Briefing
EABL F09 Investor Group Briefing “Investing Investing for the future” Seni Adetu - Group Managing Director P t Ndegwa Peter Nd - Group G Finance Fi Director Di t 28th August 2009 Highly Restricted & Confidential
Slide 2: Agenda
Agenda > Business B i U Update d t GMD > Financial Review GFD >Q&A All Highly Restricted & Confidential 2
Slide 3: Business Update
Business Update Highly Restricted & Confidential 3
Slide 4: F09 saw tough environment
F09 saw tough environment … > Significant economic slow down > Massive cost pressures > Unanticipated tax changes > Shift in retail and consumer dynamics > Competition on all fronts Highly Restricted & Confidential 4
Slide 5: Notwithstanding we posted credible performance
Notwithstanding we posted credible p performance > Clear vision supported by bold volumes strategic pillars -4% 4% net sales value +6% > Great talent and strong brand cost of goods +14% portfolio gross profit 0% -2% > Continued strong innovation and A&P renovation OH OHs 0% OHs* * including reorgani
Slide 6: And executed strongly across Region
And executed strongly across Region kenya uganda tanzania great lakes Highly Restricted & Confidential 6
Slide 7: Well activated renovation
Well activated renovation … new ‘GK’ - - Guinness Kubwa Highly Restricted & Confidential 7
Slide 8: Continued to invest in the business
Continued to invest in the business … Kshs 2Bn CAPEX Kenya > Line 2 complete and in use > 6 new DPV’s DPV s and 4 BBT’s BBT s commissioned and in use > New Boiler, air compressor, fridge plant and HV Switchgear all commissioned Uganda > Fire Fi alarm l and d ammonia i lleak k detection complete and
Slide 9: Dialed up Our people agenda
Dialed up Our people agenda … > Employee engagement programs One company, One culture > Repositioned Organisation to win Restructuring to create a Simpler Simpler, Faster Faster, Better organisation > Continued to build capability Tusker Academy > Sustained succession planning activities Early caree
Slide 10: Whilst enriching Our Communities
Whilst enriching Our Communities responsible drinking planted over 105K trees across EA potable water to over 515K paxs in EA Highly Restricted & Confidential 10
Slide 11: The Future
The Future Highly Restricted & Confidential 11
Slide 12: The future
The future with growth re-emerging, albeit slowly … source: world economic report > Upturn in disposable incomes > Improving p g consumer confidence > Returning financial stability Highly Restricted & Confidential 12
Slide 13: However F09 challenges likely to expand to F10
However F09 challenges likely to p expand to F10 > Continuing economic challenges > Increasing competition across the region > Tax remains at higher level than elsewhere in the region > War for talent > Increasing insecurity across our markets Highly Restricted & Confidential 13
Slide 14: Our Vision
Our Vision to be Eastern Africa's #1D Drinks i k CCompany by Market and Segment by 2010 Highly Restricted & Confidential 14
Slide 15: In conclusion, we are confident to sustain performance and trajectory
In conclusion … we are confident to sustain performance and trajectory >U Underlying de y g bus business ess fundamentals u da e ta s remain e a ststrong o g > Organisation restructured for increased efficiencies > Great talent, strong brands, good corporate reputation > Ring fence Kenya and acceler
Slide 16: Financial Review
Financial Review Highly Restricted & Confidential 16
Slide 17: Sustained performance in tough macros
Sustained performance in tough macros Group P & L Highlights Growth volume -4% nsv 6% > Tough in Kenya gross profit -1% > Competition C titi iin U Uganda d A&P -2.0% Overheads 0% > High input/energy costs PBT before reorganisation 1% PBT after reorganisation -3% > Improved operations net profit -5%
Slide 18: Strong metrics
Strong metrics … Net sales value EPS d down -5% 5% 6% up by Targeted -2.4% 2.4% 6.5 Bn Ksh marketing k ti spend d C hb Cash balance l Delivered profit Returning cash 9Ksh/share before tax and 1% to shareholders reorganization ??% + xx% Highly Restricted & Confidential 18
Slide 19: Growing NSV across the markets
Growing NSV across the markets NSV share by market NSV Contribution - F09 NSV Contribution F08 6% 3% 21% 17% Kenya Kenya Uganda Uganda GLR GLR 77% 76% > impressive growth in GLR and exports – to 6% of Group Highly Restricted & Confidential 19
Slide 20: Kenya
Kenya Resilient performance in very ‘soft’ market > Sales growth driven by Tusker Senator, Guinness and Whitecap > Selective pricing review led to improved sales value to offset against rising costs > Significant cost pressure mostly caused by higher raw material cost, cost energy & taxes Volume gro
Slide 21: Uganda
Uganda Growth in a very competitive environment > Heightened competitive activity targeting our key brands > Held market share and grew Net Sales of Bell and Waragi, but with unfavourable costs per unit > Overheads O h d were containedt i db butt marketing spend accelerated to meet Volume growth 23%
Slide 22: GLR and Exports
GLR and Exports South Sudan Positively progressing geographic expansion Eastern DRC > Enhanced product distribution – Pilsner grew by 11% Rwanda Burindi > Better yields and lower COGS > Delivered and effective business operating ti model d l iin place l Volume growth 11% Marketing spend < >% Highly
Slide 23: Tanzania
Tanzania Sustained volumes, South Sudan growing share of associate Democratic Republic of Congo Uganda g > Challenges in driving volumes of our Lake Kenya Victoria key brands Rwanda Burundi > New strategies sought to create more value Tanzania Volumes < >% SOA 26% Highly Restricted & Confidential 23
Slide 24: Income statement Ksh (Mn)
Income statement Ksh (Mn) SUMMARY GROUP P&L 2009 2008 Movement Kshs M Kshs M Kshs M Change % Net Revenue 34,408 32,488 1,920 6% Cost of Sales (17,079) (15,007) (2,072) 14% Gross Profit 17,329 17,481 (153) -1% Other Operating Income(Expense) (336) (599) 263 -44% Selling & distribution (2,115) (2,164)
Slide 25: Markets contributed
Markets contributed … Kenya F09 Kshs bn GROWTH Net Sales 26.5 1% Profit Before Taxes 9.2 -5% Uganda F09 Net Sales 6.77 0% Profit Before Taxes 0.80 -31% Tanzania F09 Volumes (Eus) 495 0% Share of Associates 1.02 26% Exports F09 Volumes (Eus) 436 12% Highly Restricted & Confidential 25
Slide 26: Our dividend proposal
Our dividend proposal… > Final dividend proposal of Kes 5.55/share > Final dividend payment of Kes 4.5Bn > Taking full year dividend to Kes 8.05/share, same level as LY > Full year dividend payment of Kes 6.4Bn DPS Growth 9.00 8.00 7.00 6.00 Kes / Share 5.00 4.00 3.00 5Y CAGR +22% 2.00 1.00 - 2003 2
Slide 27: F10 Outlook positive with clear strategies
F10 Outlook positive with clear g strategies > Revenue growth management initiatives > Consolidating our Spirits business and market for growth through engagement with Government and fighting re emergence of illicit > Effective Eff ti managementt off COGS pressures (raw materials, utilities & fuel)
Slide 28: Closing
Closing Highly Restricted & Confidential 28
Slide 29: Q&A
Q&A Highly Restricted & Confidential 29
Slide 30: Thank You
Thank You Highly Restricted & Confidential
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