British American Tobacco P.l.c. · LSE:BATS
British American Tobacco P.l.c — Debt Investor Presentation (February 2022)
18 slides from British American Tobacco P.l.c's debt investor presentation, February 2022
Slide 1: Important Information
Important Information The information contained in this presentation in relation to British American Tobacco p.l.c. (“BAT”) and its subsidiaries has been prepared solely for use at this presentation. The presentation is not directed to, or intended for distribution to or use by, any person or entity
Slide 2: Important Information
Important Information Forward-looking Statements (continued) Additional information concerning these and other factors can be found in BAT’s filings with the U.S. Securities and Exchange Commission (“SEC”), including the Annual Report on Form 20-F and Current Reports on Form 6-K, which may be obtain
Slide 3: 2021 – A Pivotal Year Delivered; Buyback Announced
2021 – A Pivotal Year Delivered; Buyback Announced Fixed Income Update Call - Preliminary Results 2021 Tadeu Marroco – Finance and Transformation Director | Neil Wadey – Group Head of Treasury
Slide 4: We are delivering A Better Tomorrow
We are delivering A Better Tomorrow TM From To Multi-Category CPG Cigarettes Nicotine & Beyond* Declining Volume Growing Volume Growing Value & Value 50 million consumers of £5bn New Category Carbon neutral Net zero value chain Eliminate unnecessary single- non-combustible** Revenue by 2025 Scope 1&
Slide 5: Our transformation accelerated
Our transformation accelerated Actively encouraging smokers to switch to our reduced risk products^ 51% New Category revenue growth* Adding 4.8m adult consumers of non-combustible products** to reach 18.3m Built a >£2bn New Category revenue business To reduce the health impact New Category losses re
Slide 6: With faster adult consumer acquisition
With faster adult consumer acquisition* +4.8m 18.3m +3.0m 13.5m 8.4 +2.5m 10.5m 6.7 8m 5.2 6.7 3.5 4.0 2.6 2.1 1.5 2.1 0.1 0.8 2.9 2.9 3.0 2.9 -0.6 -1.0 -1.7 -1.9 2018 2019 2020 2021 Traditional Oral Modern Oral THP Vapour Poly-Usage** Growth of consumers of Non-Combustible products*** Source: Compa
Slide 7: Strong revenue growth across all three New Category Global Drive Brands
Strong revenue growth across all three New Category Global Drive Brands Global Fastest Growing Global Leadership THP Brand Leadership achieved ambition ambition Revenue* up +59% Revenue* up +46% Revenue* up +41% Value share** 33.5% Volume share** 18.1% Volume share** 34.7% Vuse global leadership bas
Slide 8: We are embedding ESG in our brands
We are embedding ESG in our brands Focus areas Focus areas Focus areas Source: Company data. Focus areas shown above demonstrate our ESG ambitions for each brand. For more detail on our environmental targets, see Appendix A5. 8
Slide 9: A Pivotal Year delivered
A Pivotal Year delivered Accelerating New Reducing New Category De-levering to c. 3x adj. Category revenue growth* losses** net debt/adj. EBITDA*** 51% c.£100m 2.99x Revenue Reduced Leverage growth* losses** Enabling more active capital allocation Including £2bn Share Buyback in 2022 * Constant rate
Slide 10: Together with c.£100m reduced losses from New Categories driven by growing scale
Together with c.£100m reduced losses* from New Categories driven by growing scale Improved Trade • Vuse Trade Margins improved by 31% Margin** • Further scale benefits Reduced Cost of • c.£220m productivity savings*** delivered in 2021 Goods • Vuse Cost of Goods reduced by 22% driven by automation •
Slide 11: Combustibles: Delivering value growth
Combustibles: Delivering value growth +10 bps -10 bps +20 bps Combustibles Combustibles Strategic Brand Value Share^ Volume Share^ Value Share^ +4.0 % +4.3 % c.£260m Combustibles Combustibles Absorbed Australasia Revenue* Price/Mix** Profit impact ^ Share growth versus FY20. Cigarette share. See App
Slide 12: Robust 2021 Results
Robust 2021 Results +6.9% +4.3% +20bps £7.4bn Group Combustibles Cigarette & THP Free Cash Flow*** Revenue* Price/Mix** Value Share^ +51% -0.3% +5.2% +6.6% New Category Combustibles Adjusted Profit Adjusted Diluted Revenue* BAT Volume from Operations* EPS* Share growth FY21 versus FY20. Source: Comp
Slide 13: A Pivotal Year - Delivered on our 2021 financial focus areas
A Pivotal Year - Delivered on our 2021 financial focus areas Releasing c.£100m reduction in New Category losses* for the first time funds to support growth agenda c.£500m increased** NC investment Maximising c.£1.3bn total Quantum savings delivered marketing spend effectiveness 104% Operating Cash C
Slide 14: Cash and Deleverage: c.3x target reached with strong cash conversion
Cash and Deleverage: c.3x target reached with strong cash conversion Strong Operating Cash Manageable Maturity Leverage Reduced to c.3x Flow Conversion* Profile Adjusted net debt / £ in billions adjusted EBITDA** 103% 104% 97% 3.8 3.51 3.26 2.4 2.0 2.99 FY19 FY20 FY21 FY19 FY20 FY21 Due'22 Due'23 Du
Slide 15: Committed to shareholder returns, with £2bn 2022 buyback
Committed to shareholder returns, with £2bn 2022 buyback Cash Flow c.£40bn Investing Litigation/ 5 Year in our Fiscal/Regulatory Cumulative Transformation outcomes Free Cash Flow*** Free Cash Flow* Growing Leverage Bolt-On Share Dividend within 2-3X** M&A Buybacks Active Capital Allocation Framework
Slide 16: We are Building A Better Tomorrow
We are Building A Better TomorrowTM Delivered the pivotal year in our journey We have accelerated our transformation We are on track for our key ESG targets: • £5bn New Category Revenue and profitability by 2025 • 50mn Non-Combustible Product Consumers* by 2030 To reduce the health impact • Carbon N
Slide 17: We are entering the next phase of our journey – Faster Transformation
We are entering the next phase of our journey – Faster Transformation £5bn New Category Beyond Cumulative 3-5% Group High-Single revenue and Nicotine free cash Revenue Figure profitability by opportunities generation Growth*** EPS^ growth 2025* c.£40bn** Medium term outlook * Profitability at catego
Slide 18: Appendix
Appendix A1: Adjusting (Adj.) Adjusting items represent certain items which the Group considers distinctive based upon their size, nature or incidence. A2: Constant currency Constant currency – measures are calculated based on the prior year's exchange rate, removing the potentially distorting effec
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