Anadolu Efes Biracilik Ve Malt Sanayii A.s. · BIST:AEFES

Anadolu Efes Biracilik Ve Malt Sanayii A.s — Q1 2017 Earnings Presentation

27 slides from Anadolu Efes Biracilik Ve Malt Sanayii A.s's earnings presentation, May 5, 2017

  1. Slide 1: 1Q2017 Conference Call Presentation

    v 1Q2017 CONFERENCE CALL PRESENTATION May 5, 2017 1

  2. 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

  3. Slide 3: General Overview & Operating Environment

    GENERAL OVERVIEW & OPERATING ENVIRONMENT

  4. Slide 4: Key Highlights on Consolidated Performance – 1Q2017

    Key Highlights on Consolidated Performance – 1Q2017 Volume up 6.0% in 1Q2017 vs. 1Q2016  The highest quarterly volume growth since 2014  Benefiting from strong performance of international beer operations and soft drinks Revenue up 25.5% in 1Q2017 y-o-y, outperforming volume growth ;  Strong volu

  5. Slide 5: Consolidated Performance – 1Q2017

    Consolidated Performance – 1Q2017 SALES VOLUME NET SALES REVENUE EBITDA (BNRI) & EBITDA (BNRI) Margin 13.1% 12.2% mn TL mn TL 2,425.7 mhl 1,933.2 295.2 16.5 17.5 252.9 1Q2016 1Q2017 1Q2016 1Q2017 1Q2016 1Q2017 BREAKDOWN* 7% 12% 18% 19% 24% 75% 18% 64% 63% Turkey Beer International Beer Soft Drinks 5

  6. Slide 6: Soft Drinks Volume Development – 1Q2017

    Soft Drinks Volume Development – 1Q2017 Volume Breakdown by Country* %5.1 Others 221,8 7% 233,0 Iraq *Breakdown is on a combined basis 112.0 9% 105.9 Kazakhstan m u/c 10% Turkey 51% 115.8 118.9 Pakistan 24% 1Q2016 1Q2017 Turkey International  Turkey delivered 2.7% volume growth in 1Q2017  Internat

  7. Slide 7: Beer Volume Development – 1Q2017

    Beer Volume Development – 1Q2017 4.3 4.0 Total beer group sales volume at 4.3 mhl, up 9.1% Russian beer market is estimated to be down mid-to-high single digit 2.7 3.2 on the back of, mhl  PET regulation 1.2 1.2 1Q2016 1Q2017  Downsizing Turkey Beer International Beer Volume Breakdown by Country*

  8. Slide 8: Turkey Beer Operations – 1Q2017

    Turkey Beer Operations – 1Q2017 DOMESTIC SALES VOLUME MARKET SHARE* Other; 0.1% Tuborg 38% Efes Turkey 62% 1.1 1.0 1Q2016 1Q2017 Efes Turkey Tuborg Other  Turkey beer market is estimated to be down by low single digits in 1Q2017 vs 1Q2016.  Apart from the challenges in the beer market, Anadolu Efe

  9. Slide 9: International Beer Operations – 1Q2017

    International Beer Operations – 1Q2017 EFES RUSSIA MARKET SHARE* Efes RUSSIA Efes RUSSIA 3.2 16% 2.7 15% Carlsberg Carlsberg 1Q2016 1Q2017 32% 32% Inbev Inbev  EBI volumes grew by 14.8% 12% 12% Heineken Heineken  Above expectation volume performance across all operating countries 13% 13% Others Ot

  10. 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

  11. Slide 11: Financial Overview

    FINANCIAL OVERVIEW

  12. Slide 12: Anadolu Efes Consolidated Performance – 1Q2017

    Anadolu Efes Consolidated Performance – 1Q2017 ANADOLU EFES CONSOLIDATED (TL mn) 1Q2016 1Q2017 Change (%) Volume (mhl) 16.5 17.5 6.0% Net Sales 1,933.2 2,425.7 25.5% Gross Profit 732.0 869.6 18.8% EBIT (BNRI) 47.0 60.3 28.4% EBITDA (BNRI) 252.9 295.2 16.7% Net Income** 60.3 -84.9 n.m. Margins Change

  13. Slide 13: Beer Group Performance – 1Q2017

    Beer Group Performance – 1Q2017 TURKEY BEER INTERNATIONAL BEER BEER GROUP (TL mn) (TL mn) (TL mn) 1Q2017 vs 1Q2016 1Q2017 vs 1Q2016 1Q2017 vs 1Q2016 Volume (mhl) 1.2 -3.6% 3.2 14.8% 4.3 9.1% Net Sales 294.8 4.0% 570.3 65.9% 870.1 37.7% Gross Profit 160.1 1.7% 226.1 45.9% 390.5 23.8% EBIT (BNRI) 16.1

  14. Slide 14: Beer Group Free Cash Flow – 1Q2017

    Beer Group Free Cash Flow – 1Q2017 Beer Group Free Cash Flow (TL mn) 1Q2016 1Q2017 EBITDA 96.3 100.9 Change in Working Capital -66.7 -15.8 Income Taxes & Employee Benefits Paid -15.4 -23.2 CAPEX, net -63.9 -88.6 Net Financial Income /(Expense) -1.4 0.9 FCF -51.1 -25.8 Other investing activities (Acq

  15. Slide 15: Balance Sheet Flexibility: Net Leverage Ratio

    BALANCE SHEET FLEXIBILITY ◉ 1Q2017 Net Leverage Ratios are within comfortable area Net Leverage Ratio:Net Debt / EBITDA (BNRI) Anadolu Efes Consolidated Beer Group 2.0 2.1 ◉ 74% of cash is hold as hard ◉ 70% of cash is hold as hard times times currency 1.8 currency 1.7 ◉ 99% of debt is in hard ◉ 100

  16. 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. 4.6 years and  Anadolu Efes is app. 3.1 years 750 696 500 508 Maturity Schedule* BEER 159 128 128 116 CCI 98 98 63 54 54 44 43 AEFES 35 8 8 8 8 8 2017 2018 2019 2020 202

  17. 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 : 23% Floating : 13% Fixed : 75% Fixed : 77% Fixed : 77% Fixed : 87% 1Q2016 1Q2017 1Q2016 1Q2017 17

  18. Slide 18: Financial Income/(Expense) Breakdown – 1Q2017

    Financial Income/(Expense) Breakdown – 1Q2017 Financial Income / (Expense) Breakdown 1Q2016 1Q2017 Interest income 19.5 27.6 Interest expense -52.2 -60.9 Foreign exchange gain /(loss) 81.2 -121.7 Other financial expenses (net) -4.6 -8.0 Gain/(loss) on derivative transactions -9.3 0.3 Net Financial I

  19. Slide 19: Anadolu Efes Consolidated Free Cash Flow – 1Q2017

    Anadolu Efes Consolidated Free Cash Flow – 1Q2017 Anadolu Efes Free Cash Flow (TL mn) 1Q2016 1Q2017 EBITDA 251.4 294.6 Change in Working Capital -83.1 -159.4 Income Taxes & Employee Benefits Paid -27.5 -46.7 CAPEX, net -202.2 -199.5 Net Financial Income /(Expense) -7.6 34.4 FCF -68.9 -76.5 Other inv

  20. 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

  21. Slide 21: Closing Remarks

    CLOSING REMARKS

  22. 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

  23. 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

  24. Slide 24: Q&A Session

    Q&A SESSION

  25. Slide 25: Appendix

    APPENDIX

  26. Slide 26: Gross & Net Debt

    GROSS & NET DEBT Anadolu Efes Consolidated Beer Group 1Q2016 1Q2017 1Q2016 1Q2017 5,271 6,425 TOTAL FINANCIAL DEBT (m TL) 2,009 2,524 TOTAL FINANCIAL DEBT (m TL) TOTAL CASH & EQUIVALENTS (m TL) TOTAL CASH & EQUIVALENTS (m TL) 1,709 2,683 843 1,296 NET DEBT (m TL) 1,166 1,228 NET DEBT (m TL) 3,562 3,

  27. Slide 27: FX Rates

    FX RATES 1Q2016 1Q2017 Δ% AVG 2.94 3.69 25.6% USD/TL PE 2.83 3.64 28.4% AVG 3.24 3.93 21.3% EUR/TL PE 3.21 3.91 21.8% AVG 74.63 58.84 -21.2% USD/RUB PE 67.61 56.38 -16.6% AVG 356.62 322.53 -9.6% USD/KZT PE 343.06 314.79 -8.2% AVG 25.80 27.07 4.9% USD/UAH PE 26.22 26.98 2.9% AVG 20.07 19.96 -0.6% USD

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