Barry Callebaut Ag · SIX:BARN
Barry Callebaut — FY2014/15 Earnings Presentation
34 slides from Barry Callebaut's earnings presentation, Nov 4, 2015
Slide 1: Full Year Results 2014/15 Analysts Conference
Full Year Results 2014/15 Analysts Conference November 4, 2015 November 4, 2015
Slide 2: Cautionary note
Cautionary note Certain statements in this presentation regarding the business of Barry Callebaut are of a forward- looking nature and are therefore based on management’s current assumptions about future developments. Such forward-looking statements are intended to be identified by words such as “be
Slide 3: Agenda
FY Results 2014/15 Agenda First impressions & Highlights FY 2014/15 - CEO Antoine de Saint-Affrique Performance FY 2014/15 - CFO Victor Balli The way forward - CEO Antoine de Saint-Affrique Questions & Answers session - CEO & CFO Page 3 November 4, 2015 Analysts Conference
Slide 4: First impressions & Highlights FY 2014/15
First impressions & Highlights FY 2014/15 - CEO Antoine de Saint-Affrique November 4, 2015
Slide 5: My first impressions
My first impressions Unique focus Disciplined Balancing People and Innovative the short Values deep expertise Entrepreneurial and long-term Performance Page 5 November 4, 2015 Analysts Conference
Slide 6: A view on the market
FY results 2014/15 A view on the market The new normal: volatile & complex A world of new opportunities • Currencies and economic growth • Consumer driven • Premiumization, personalization, taste, clean/clear labels, snacking • Sustainability & traceability • Customer centric • Innovate with & for c
Slide 7: 2014/15: delivering the short term, building for the long term
2014/15: delivering the short term, building for the long term Inaguration new CHOCOLATE Optimized cocoa Expansion of Chocolate Start-up of operations in Fermentation process, for Acquisition of American ACADEMY TM centers in Dubai, factory in Brazil and Poland our first Chocolate factory superior t
Slide 8: Barry Callebaut continues to significantly outperform the global chocolate market
FY results 2014/15 Barry Callebaut continues to significantly outperform the global chocolate market Sales volume growth +4.5%, significantly outperforming the market1 and accelerating in Q4 Broad-based growth mainly driven by developed markets, as well as outsourcing, Gourmet and emerging markets C
Slide 9: Performance FY 2014/15
Performance FY 2014/15 – CFO Victor Balli November 4, 2015
Slide 10: Volume growth above global market with acceleration in Q4
FY results 2014/15 Volume growth above global market with acceleration in Q4 (tonnes) +4.5% +10.7% 45'668 +3.7% +2.0% 15,208 +0.2% 16'090 1’050 1’794’782 1’716’766 Q1 Q2 Q3 Q4 Sales Volume FY 2014/15 Market Volume growth * -1.8% -1.7% -3.3% -3.9% -2.7% * Source: Nielsen chocolate confectionery in vo
Slide 11: Positive contribution from key growth drivers
FY results 2014/15 ... and with positive contribution from our key growth drivers Emerging Markets Long-term outsourcing & Gourmet & Specialties Strategic Partnerships Volume growth +5.1% vs prior year +6.6% vs prior year +6.0% vs prior year FY 2014/15 CAGR 5 year +17.3% +16.5% +6.5 % Volume 10% 33%
Slide 12: Solid volume growth gaining momentum, strong profit improvement in local currencies
FY results 2014/15 Solid volume growth gaining momentum, strong profit improvement in local currencies Group performance FY 2014/15 % vs prior year % vs prior year (in CHF) (in CHF) in local (In CHF mio.) currencies Sales Volume Total 1,794,782 +4.5% (in tonnes) Sales Revenue 6,241.9 +6.4% +12.1% Gr
Slide 13: Good performance in developed regions
FY results 2014/15 Good performance in developed regions Europe Americas Asia Pacific Global Cocoa 4% 4% 28% 28% 42% 26% 25% Volume growth +3.9% +4.7% +7.2% +5.1% EBIT growth in +19.7% -0.3% +5.9% -33.7% local currencies EBIT growth in CHF +8.1% +3.3% -0.4% -42.4% Page 13 November 4, 2015 Analysts C
Slide 14: Gross profit up 4.8% in local currencies
Gross Profit FY 2014/15 Gross profit up +4.8% in local currencies, due to solid volume growth, strong focus on margins and despite a historically low cocoa combined ratio in CHF mio. -1.7% +4.8% 52.1 902.6 28.4 -24.5 -14.5 861.1 846.8 -55.8 Gross Profit Volume Product Mix Cocoa Add. Direct Gross Pro
Slide 15: Challenging cocoa market environment and combined ratio
Cocoa processing profitability Challenging cocoa market environment with negative impact from the cocoa combined ratio in FY 2014/15, strongly affecting current fiscal year European combined ratio - 6 months forward ratio FY 2014/15 4.0 3.0 Combined ratio 2.9 Butter ratio 2.0 1.0 Powder ratio 0.0 Oc
Slide 16: Cocoa Leadership Project
Cocoa Leadership Project Assert our leadership in Cocoa, fully leverage our scale and improve profitability Commercial leadership Centralized global steering Operations & Supply Chain leadership Differentiating and Centralizing key strategic Optimizing our cocoa repositioning the activities, such as
Slide 17: Operating profit improved 7.4% in local currencies
EBIT FY 2014/15 Operating profit improved 7.4% in local currencies, due to a good product & customer mix, as well as stricter fixed cost discipline in CHF mio. -0.3% +7.4% 41.5 447.1 -10.1 -0.4 416.2 414.8 -32.3 EBIT Additional Additional Add. Costs, other EBIT FX impact EBIT 2013/14 Gross Profit SG
Slide 18: 6-year EBIT per tonne development
6-year EBIT per tonne development Improvement of the EBIT per tonne in constant currencies continued 312 282 290 274 279 EBIT per tonne 286 251 in constant currencies EBIT per tonne in CHF 256 242 (as reported) 231 223 +8.2% 1’717 1’795 1’379 1’536 1’210 1’269 Volume in kMT 2009/10 2010/11 2011/12 2
Slide 19: From EBITDA to Net Profit
From EBITDA to Net Profit Net Profit -2.7% in local currencies (-5.9% in CHF) , due to higher average financing requirements, a foreign exchange loss, as well as higher taxes in CHF mio. 540.8 -126.0 414.8 -130.7 -44.2 -5.9% 239.9 255.0 EBITDA Depreciation EBIT Net Financial Income Net Profit for th
Slide 20: Raw materials evolution
Raw materials evolution Cocoa bean price still at relatively high levels, other raw materials below prior year FY 14/15 FY vs. prior 300% year 250% Cocoa beans 200% +4% Sugar world 150% -9% 100% Sugar EU -21% 50% Milk powder -23% 0% Sep.2007 Sep.2008 Sep.2009 Sep.2010 Sep.2011 Sep.2012 Sep.2013 Sep.
Slide 21: Net Working Capital
Net Working Capital Working Capital below prior year as a result of reduction in inventories and positive currencies effect in CHF mio. Receivables Stocks Payables -8.7% +80 +170 +35 -111 -36 1’675 -114 1’530 -170 Net Growth Price and Growth Operational Growth Price impact Others and Net Working imp
Slide 22: Cash Flow
Cash Flow Cash Flow improvement due to lower investment in working capital in CHF mio. -0.2% 474 473 -101 (PY -279) -145 (PY- 142) +87 +24 (PY +271) (PY +17) -205 (PY -227) -85 (PY -80) Operating Operating Investment in Interest paid Cash flow Dividend Cash flow from Net increase in Cash Flow* Cash
Slide 23: Balance Sheet & key ratios
Balance Sheet & key ratios Deleveraging of the company and improvement of key financial ratios remain a high priority Aug 15 Aug 14 Total Assets [CHF m] 5'429.4 5'167.5 Net Working Capital [CHF m] 1'529.7 1'674.6 Non-Current Assets [CHF m] 2'185.5 2'175.6 Net Debt [CHF m] 1'728.0 1'803.5 Shareholder
Slide 24: Proposed dividend of CHF 14.50, stable payout ratio of 33%
Dividend Proposed dividend of CHF 14.50, stable payout ratio of 33% Proposed dividend Payout ratio CHF 14.50 per share1 35% Payout of 33% of Net Profit 33% 33% 33% 31% Not subject to withholding tax2 255 240 223 177 Timetable for dividend 143 Shareholder approval: Dec 9, 2015 (AGM) Expected ex-date:
Slide 25: 5-year development
5-year development Long-term and continued strong volume and EBIT growth in a capital intensive business Sales Volume EBIT CAGR +7.9% CAGR +9.1% Currency effects (cumulated) BC Group 10/11 11/12 12/13 13/14 14/15 10/11 11/12 12/13 13/14 14/15 CAPEX Net Working Capital CAGR +14.6% CAGR +14.6% 10/11 1
Slide 26: The way forward
The way forward – CEO Antoine de Saint-Affrique November 4, 2015
Slide 27: We have a clear and successful long-term strategy
We have a clear and successful long-term strategy “Heart and engine of the Vision chocolate and cocoa industry” Expansion Sustainable, 4 strategic Innovation profitable pillars growth Cost Leadership Sustainable Cocoa Page 27 November 4, 2015 Analysts Conference
Slide 28: Strategy unchanged, execution adjusted
Strategy unchanged, execution adjusted We are entering the next phase of our journey Focus on consistent, above market-growth and enhanced profitability: “SMART GROWTH” Sustainable growth Margin accretive growth Accelerated growth in Gourmet, Specialties and emerging markets Return on Capital and gr
Slide 29: Expansion: Accelerate Gourmet, Specialties and Emerging Markets
Expansion: Accelerate Gourmet, Specialties and Emerging Markets Further drive Further expand in Further leverage Gourmet & Specialties Emerging markets Outsourcing & strategic partnerships Page 29 November 4, 2015 Analysts Conference
Slide 30: Innovation: Margin accretive growth, value added products & services
Innovation: Margin accretive growth, value added products & services Products Channels Be ahead Added-value Added-value Be on trend of the curve products services Clean label, free Acticoa Decorations, Co-creation from Inclusions, fillings, Thermo-tolerant Innovative concepts 2 & 3 D printing Fermen
Slide 31: Cost Leadership: Returns from scale, leverage & operational excellence
Cost Leadership: Returns from scale, leverage & operational excellence Leverage our global scale Operational excellence Leverage our footprint Leverage our scale Continuous improvement Cocoa Leadership European shared service One + centre Finance Excellence Quality Culture Western Europe & EEMEA Cen
Slide 32: Sustainable Cocoa: innovation, implementation, impact
Sustainable Cocoa: innovation, implementation, impact Sustainable practices, prosperous communities, long term supply Leading sustainability Collaborating for impact Setting new benchmarks • A holistic approach • Pre-competitive platforms • Cocoa Horizons Foundation • Capability based • Customer par
Slide 33: Outlook
Outlook Strive for smart balance between consistent, above-market volume growth and enhanced profitability Mid-term guidance (until 2017/18) We will strike a balance between volume growth and enhanced profitability as well as free cash flow generation: “smart growth” Average volume growth 4-6% EBIT
Slide 34: Thank you
Thank you Page 34 November 4, 2015 Analysts Conference