Anheuser-busch Inbev Sa/nv · EURONEXT:ABI
Anheuser-busch Inbev Sa/nv — Q1 2020 Earnings Presentation
28 slides from Anheuser-busch Inbev Sa/nv's earnings presentation, May 7, 2020
Slide 1: First Quarter 2020 Results
First Quarter 2020 Results 07 May 2020 © AB InBev 2020 – All rights reserved
Slide 2: Legal Disclaimers
LEGAL DISCLAIMERS Certain statements contained in this report that are not statements of historical fact constitute forward-looking statements, notwithstanding that such statements are not specifically identified. In addition, certain statements may be contained in the future filings of the Company
Slide 3: Bringing People Together for a Better World
Bringing People Together for a Better World © AB InBev 2020 – All rights reserved 3
Slide 4: Agenda
AGENDA Ø 1Q20 RESULTS Ø BUSINESS UPDATE IN LIGHT OF THE COVID-19 PANDEMIC Ø FINANCIALS Ø Q&A © AB InBev 2020 – All rights reserved 4
Slide 5: 1Q20 Financial Summary
1Q20 FINANCIAL SUMMARY TOTAL VOLUMES -9.3% • Own beer -10.5%, non-beer -0.2% • Total volumes +1.9% in January and February excluding China, -3.6% in 1Q20 excluding China TOTAL REVENUE -5.8% • Revenue per hl +3.9% • Global brands -11.0% and -17.5% outside of their home markets, with growth across mos
Slide 6: 1Q20 Key Market Takeaways
1Q20 KEY MARKET TAKEAWAYS US: Top-line growth with strong performance of above core brands, including successful launch of Bud Light Seltzer Mexico: Double-digit revenue growth, with volume growth ahead of the industry and continued OXXO expansion Colombia: Started the year with strong momentum, wit
Slide 7: 2Q20 Is Expected to Be Materially Worse Than 1Q20
2Q20 IS EXPECTED TO BE MATERIALLY WORSE THAN 1Q20 1Q20 AND APRIL VOLUME TRENDS • Our April volumes declined by ~32%, 1.9% primarily driven by: -3.6% • The closure of the on-premise -9.3% channel in most markets, which in 2019 represented ~1/3 of our global volume • Full shutdown of our beer ~-32% op
Slide 8: Business Update in Light of the Global COVID-19 Pandemic
BUSINESS UPDATE IN LIGHT OF THE GLOBAL COVID-19 PANDEMIC 8 ©©AB ABInBev InBev2020 2020––All Allrights rightsreserved reserved 8
Slide 9: The Safety of Our People Is Our Top Priority
THE SAFETY OF OUR PEOPLE IS OUR TOP PRIORITY SAFETY PROTOCOLS TEMPERATURE CHECKS HAND SANITIZING STATIONS © AB InBev 2020 – All rights reserved 9
Slide 10: Supporting Our Community & Customers
SUPPORTING OUR COMMUNITY & CUSTOMERS COMMUNITY INITIATIVES CUSTOMER INITIATIVES • Production and donation of over 3 million bottles of Tailored initiatives in support of our customers hand sanitizer in over 25 countries and the hospitality industry across 20 of our markets, including: • Packaging an
Slide 11: Our On-Premise Exposure Varies Widely by Market
OUR ON-PREMISE EXPOSURE VARIES WIDELY BY MARKET At a global level, we had 33% exposure to the on-premise channel in 2019 Household Consumer Expenditure per Capita (Index) 0 25 50 75 100 MOZ 0% Off Trade Weight for our Operations as of 2019 TAN NIG 20% SAF COL 40% BOL DOM CHN BRA SKR BEL 60% GER ITA
Slide 12: Our Markets Grouped into Four Clusters by Pandemic Stage
OUR MARKETS CAN GENERALLY BE GROUPED INTO FOUR CLUSTERS, DEPENDING ON THE STAGE OF THE PANDEMIC, MATURITY CHARACTERISTICS AND EXTENT OF RESTRICTIONS ON OUR OPERATIONS Four Clusters of our Markets* Status of Operations* Top 10 Markets by Brew Distribute Cluster Description Key Markets 2019 Volume Bra
Slide 13: Actions We Are Taking to Position Ourselves for a Strong Recovery
ACTIONS WE ARE TAKING TO POSITION OURSELVES FOR A STRONG RECOVERY 13 © AB InBev 2020 – All rights reserved
Slide 14: We Implemented a COVID-19 Task Force
WE IMPLEMENTED A COVID-19 TASK FORCE • Cross-functional team with key functional leaders • Daily meetings and regular touchpoints with the senior leadership team • Key priorities include: • Safety of our people • Support of our communities and our partners • Safeguarding business continuity (includi
Slide 15: We Are Leveraging Learnings from Recovering Markets
WE ARE LEVERAGING LEARNINGS FROM RECOVERING MARKETS Our People’s Supporting Our Communities Adjusting commercial strategy Health & Safety is #1 Priority & Partners and preparing for recovery Leveraging best practices regarding the Donating masks, disinfectant Consumers shifting to off-trade health &
Slide 16: Finding New Ways to Connect with Our Consumers
FINDING NEW WAYS TO CONNECT WITH OUR CONSUMERS CHINA BRAZIL US Budweiser’s E-Clubbing Brahma’s Virtual Country Michelob Ultra’s Livestream Platform Music Concert Series At-Home Workouts © AB InBev 2020 – All rights reserved 16
Slide 17: Investing Behind Emerging Trends Now More Relevant Than Ever
WE HAVE BEEN INVESTING BEHIND EMERGING TRENDS THAT ARE NOW MORE RELEVANT THAN EVER © AB InBev 2020 – All rights reserved 17
Slide 18: Our Fundamental Strengths Have Not Changed
OUR FUNDAMENTAL STRENGTHS HAVE NOT CHANGED, POSITIONING US FOR A STRONG RECOVERY CLEAR COMMERCIAL STRATEGY MOST VALUABLE BEER BRANDS 3. Close gap 2. Growth 4. Toolkits champions Plan 1. Bench- marking DIVERSE GEOGRAPHIC FOOTPRINT INDUSTRY-LEADING PROFITABILITY DEEP TALENT POOL 40.1% 2019 EBITDA MARG
Slide 19: Financials
FINANCIALS © AB InBev 2020 – All rights reserved
Slide 20: Increase in Net Finance Cost Driven by MTM Swing
INCREASE IN NET FINANCE COST DRIVEN PRIMARILY BY THE SWING IN MTM OF THE SHARE-BASED PAYMENT PROGRAMS 1Q19: 951 1Q20: (1,855) 4 16 Swing: (2,806) 79 USD millions -366 2,806 42 4 9 -3,160 1Q19 Interest Expense Net interest on Accretion MTM - share Currency and Bank fees, Hyperinflation 1Q20 Including
Slide 21: Normalized Effective Tax Rate (ETR)
NORMALIZED EFFECTIVE TAX RATE (ETR) 27.5% 25.9% 19.6% 1Q20 ETR impacted by non-deductible MTM losses on the hedging of our share-based payment programs -109.3% 1Q19 1Q19 1Q20 1Q20 Excluding MTM Excluding MTM © AB InBev 2020 – All rights reserved 21
Slide 22: Underlying EPS Decreased from $0.73 to $0.51 in 1Q20
UNDERLYING EPS DECREASED FROM $0.73 TO $0.51 IN 1Q20 0.73 0.51 -0.45 0.00 0.08 USD millions 0.13 0.01 0.01 1Q19 Normalized EBIT Hyperinflation Net finance cost Income tax expense Associates & non- Net Hyperinflation 1Q20 impacts in controlling interest impacts in EPS normalized EBIT Notes: (1) Under
Slide 23: We Are Exercising Financial Discipline in Light of the Crisis
WE ARE EXERCISING FINANCIAL DISCIPLINE IN LIGHT OF THE CRISIS Efficient utilization of Revision of final Maintaining a strong our resources 2019 dividend proposal liquidity position • Suspension or cancellation of any • Revision to our proposal of a final 2019 • Drawdown on our 9 billion USD non-com
Slide 24: April Issuances of ~11 Billion USD Strengthened Liquidity
OUR APRIL ISSUANCES OF ~11 BILLION USD FURTHER STRENGTHENED OUR LIQUIDITY AND EXTENDED OUR WEIGHTED AVERAGE MATURITY BY 5 MONTHS Pro forma AB InBev Bond Maturity Profile as of April 2020* 12,000 10,000 8,000 USD millions 6,000 ~11 BILLION USD bonds issued with 20 year average maturity and 3.7% avera
Slide 25: Bond Portfolio Protected Against Interest Rate and Currency Risk
OUR BOND PORTFOLIO REMAINS LARGELY PROTECTED AGAINST INTEREST RATE AND CURRENCY RISK, WITH A LONG-WEIGHTED AVERAGE MATURITY, AND HOLDS NO FINANCIAL COVENANTS ~95% OF OUR DIVERSE CURRENCY MIX ADDRESSED NEAR TERM VERY MANAGEABLE BOND PORTFOLIO REDUCES RISK MATURITIES TO REDUCE PRE-TAX COUPON IS FIXED
Slide 26: Capital Allocation Objectives
CAPITAL ALLOCATION OBJECTIVES Our optimal capital structure calls for a Net Debt/EBITDA ratio of approximately 2x. 1. Organic growth: Investing in the organic growth of our business 2. Deleveraging: Deleveraging to around the 2x level remains our commitment 3. Selective M&A: Non-organic, external gr
Slide 27: Q&A
Q&A © AB InBev 2020 – All rights reserved
Slide 28: Thank You
THANK YOU 28 © AB InBev 2020 – All rights reserved