Barry Callebaut AG · SIX:BARN
Barry Callebaut — Q1 2008/09 Earnings Presentation
34 slides from Barry Callebaut's earnings presentation, Jan 21, 2009
Slide 1: Barry Callebaut Q1 roadshow
Barry Callebaut Q1 roadshow January 2009 Barry Callebaut – Jan 2009
Slide 2: Agenda
Agenda u Our business and market environment u Highlights & financials Q1 2008/09 u Strategy going forward & market opportunities Barry Callebaut – Jan 2009 2
Slide 3: Active along the entire cocoa and chocolate value chain
Barry Callebaut is active along the entire cocoa and chocolate value chain Cocoa Semi-finished Products Chocolate Products Sugar 100% Retail Milk customers Other Consumer Products Liquor for Chocolate via Industrial Shells/ 27% chocolate Couverture customers waste 50% Butter Artisanal 100% customers
Slide 4: Barry Callebaut at a glance
Barry Callebaut at a glance Barry Callebaut FY 2007/08 Net revenue: CHF 4.8 bn u World leader in high-quality cocoa and chocolate products and outsourcing partner of choice, with over 40% share in the industrial chocolate market 11 %Cocoa Consumer 23Products % 13% u World’s largest supplier of Gourm
Slide 5: Global areas of responsibility for defined customer segments
Global areas of responsibility for defined customer segments Others 10% u Cocoa PNG 1% Indonesia* Ivory Coast* 13% 39% Ecuador 3% Brazil* 5% Industrial customers Cameroon* 5% Nigeria u Beverages 5% Ghana* 21% u Chocolate & Confectionery industry u Tobacco industry u Total 3,684 m tonnes harvested gl
Slide 6: Raw materials with 70% our main cost factor
Raw materials with 70% our main cost factor Barry Callebaut business model 100g 100gchocolate chocolatetablet tabletcontains: contains: Gourmet & Consumer Milk Milk Dark Dark 20% Products Price Lists Cocoa Cocoaliquor liquor 11g 11g 44g 44g regular updates Cocoa Cocoabutter butter 24g 24g 12g 12g 80
Slide 7: Cocoa price still on record levels, milked prices and combined cocoa ratio declining
Cocoa price still on record levels, milked prices and combined cocoa ratio declining London Cocoa 2nd Position Daily close, in £/ tonne Cocoa powder-butter combined ratio Jan 16, 2009 4.50 1,900.00 1766 4.00 1,700.00 3.50 1,500.00 3.00 2.50 1,300.00 718 2.00 1,100.00 1.50 900.00 1.00 700.00 0.50 01/
Slide 8: Cocoa bean demand has been exceeding supply since 2005/06
Cocoa bean demand has been exceeding supply since 2005/06 World cocoa bean production, grindings and stocks 4000 2000 3800 1900 3600 1800 3400 1700 Crop / grindings in 000 tonnes in 000 tonnes 3200 1600 Total end-of-seasons stocks 3000 1500 Cross crop (supply) Grindings (demand) 2800 1400 2600 1300
Slide 9: Big outsourcing deals drive growth
Big outsourcing deals drive growth u Food Manufacturers Industrial customers u Chocolate confectionery u Biscuits and bakery u Ice cream and desserts u Chocolate dairy u Breakfast and snacking u Sugar confectionery u Big outsourcing deals with: à Running on track JANUARY 2009 Barry Callebaut – Jan 2
Slide 10: Global areas of responsibility for defined customer segments
Global areas of responsibility for defined customer segments u Gourmet & Specialties Professional customers u Chocolate Makers & Confectioners u Bakeries & Pastries u Hotels & Restaurants u Catering & Canteens u Vending Operators u The Gourmet business is the very promising growth segment in BC grou
Slide 11: Private label business and own Barry Callebaut customer brands
Private label business and own Barry Callebaut customer brands u Consumer Products Retail customers u Food retailers u Specialty shops u Department stores u In the consumer business unit we produce own brands such as Sarotti, Jacques, Alprose (ca. 33% of sales), as well as private label chocolate (c
Slide 12: Agenda
Agenda u Our business and market environment u Highlights & financials Q1 2008/09 u Strategy going forward & market opportunities Barry Callebaut – Jan 2009 12
Slide 13: Highlights of first three months 2008/09
Highlights of first three months 2008/09 u Sales volume grew by 2.0% to 338,513 tonnes u Good growth rates in September/October offset by exceptionally weak demand in November u Short-term ordering and de-stocking effect in November u Sales revenue rose 7.2% in local currencies, 0.7% in CHF to CHF 1
Slide 14: Factories, Academies and Sales Offices: Global expansion in 2007-2009
Factories, Academies and Sales Offices: Global expansion in 2007-2009 Heule, Belgium (2008) Prague, Czech Republic (2008) Chekhov, Russia (2007, 2008) Eddystone, U.S. (2008) Zundert, Chicago, U.S. Netherlands (2008) (2008) Robinson, U.S. Dijon, France Amagasaki, Japan (2007) (2007) (2008) Alicante,
Slide 15: Official opening of Mexico factory
Official opening of Mexico factory u Barry Callebaut‘s third largest chocolate factory u Gateway to promising Central and South American markets u Capacity: 100,000 tonnes u Investment: USD 40 million u Products: liquid and molded chocolate and compounds u 80 employees u First production output: Jul
Slide 16: Region Europe – Market pressure leads to decline in sales revenue and volumes
Region Europe – Market pressure leads to decline in sales revenue and volumes Key developments Sales revenue 3 months 08/09 u Eastern Europe: Good double digit sales growth Asia u Food Manufacturers: Decline in consumer spending and RoW 7% de-stocking by customers. Acquisition of French chocolate Am
Slide 17: Region Americas – Strong performance despite difficult market environment
Region Americas – Strong performance despite difficult market environment Key developments Sales revenue 3 months 08/09 Asia u Impressive revenue growth thanks to higher volumes, RoW 7% better product mix and price increases Americas u Demand defied sharp drop in overall consumer spending 21% u FM:
Slide 18: Region Asia/Pacific & Rest of the World – Strong sales and volume growth
Region Asia/Pacific & Rest of the World – Strong sales and volume growth Key developments Sales Revenue 3 months 08/09 Asia u Sales volumes up despite sale of Consumer Products Africa RoW 7% u Melamine milk scandal holds back exports from China u FM: Good sales in China, increased capacity utilizati
Slide 19: Plant utilization
Plant utilization 2007 -09 substantial expansion of plant capacity MT Cocoa grinding capacity MT Utilization rate 93.9% 92.2% 95.6% 95.6% 600'000 500'000 400'000 300'000 u BC has very high utilization 200'000 rates in cocoa grinding and 100'000 in liquid chocolate 0 2006/07 2007/08 Plan 2008/09 Plan
Slide 20: CAPEX development
CAPEX development Planned to decrease to maintenance level in 2 years CHF m 300 250 250 200 120- additional growth 153 150 150 ~127 IT 115 On- going Upgrade/ efficiency 100 level gains existing sites Maintenane 50 0 2005/06 2006/07 2007/08 2008/09 2009/10 plan plan Barry Callebaut – Jan 2009 20
Slide 21: Stable financing situation due to long-term secured credit-lines
Stable financing situation due to long-term secured credit-lines Financing and liquidity situation per August 31, 2008 [CHF] 2500 >CHF 600 Short-term various uncommitted Financial leeway facilities 2000 per end August 2008 Maturity 2012 (16%) 1500 2013 (84%) EUR 850 CHF m Syndicated 363 bank loan AB
Slide 22: Agenda
Agenda u Our business and market environment u Highlights & financials Q1 2008/09 u Strategy going forward & market opportunities Barry Callebaut – Jan 2009 22
Slide 23: Strategy confirmed, new growth opportunities
Unchanged strategy Strategy confirmed, new growth opportunities u “Heart u “Heart and and engine engine of of the the chocolate chocolate industry” industry” Vision u Chocolate u Chocolate expert expert and and business business partner partner of of choice choice u Number u Number one one chocolate
Slide 24: Opportunities to secure future growth
Confirmed strategy Opportunities to secure future growth u Food Manufacturers – continued footprint optimization u Global operational footprint close to ideal u Expansion opportunities under review in Latin America u Production facility to open in Japan in 2009 u Organic growth opportunities in Amer
Slide 25: Additional outsourcing potential
Additional outsourcing potential Top 10 Manufacturers of Industrial Chocolate (in '000 tonnes) u Total global industrial chocolate production capacity Barry Callebaut estimated at 5.5 million tonnes Nestlé Mars u Top 5 consumer chocolate Cadbury players currently outsource Kraft approx. 8-15% of the
Slide 26: Barry Callebaut is uniquely positioned
Strong platform for continued growth Barry Callebaut is uniquely positioned u Robustness of Barry Callebaut’s business model u Proven success of Barry Callebaut’s growth strategy u Position as the global market leader u Position as the global cost leader u Expansion into high-growth markets leads to
Slide 27: Financial targets for 4-year period confirmed
Outlook confirmed Financial targets for 4-year period confirmed u Barry Callebaut’s unique positioning, combined with ongoing cost savings and efficiency initiatives, make us confident that we will reach our four-year financial targets u Annual growth targets on average* for 2007/08 -2010/11: u Volu
Slide 28: Summary
Summary Strengthened global leadership and proven business model North America, Eastern Europe and Asia on a fast growth path Four-year financial targets confirmed Barry Callebaut – Jan 2009 28
Slide 29: Back-up
Back-up Barry Callebaut – Jan 2009 29
Slide 30: Building a strong foundation for further growth
Strategic highlights 2007/08 Building a strong foundation for further growth September 2007 February 2008 July 2008 Inauguration of new Sale of Wurzen factory in Sale of factory in Chekhov, Germany Chococam to Russia January 2008 April 2008 Tiger Foods in Strategic Alliance Acquisition of 60% Camero
Slide 31: P&L Overview FY 2007/08: Limited impact from currencies
P&L Overview FY 2007/08 Limited impact from currencies % change 2007/08 2006/07 Revenue from sales and services CHF m 17.3% 4'815.4 4'106.8 in local currencies 19.1% 4'891.2 Gross Profit CHF m 7.2% 700.8 653.8 in local currencies 8.3% 708.2 EBITDA CHF m 3.9% 443.7 427.1 in local currencies 4.4% 445.
Slide 32: Cash-Flow FY 2007/08
Cash-Flow FY 2007/08 Self-financing of expansion despite net working capital increase 450 Increase by 17%, compared to a cocoa price increase of 50% mid 400 CY 07 to mid CY 08 350 + 16.1% 300 250 -152 200 CHF m 273 317 150 100 50 -250 0 -59 +75 -50 +69 -100 -150 -200 Operating Operating Inc rease in
Slide 33: Share price development still above comparable indices
0 200 400 600 800 1000 1200 03/01/08 17/01/08 31/01/08 14/02/08 28/02/08 13/03/08 27/03/08 Barry Callebaut – Jan 2009 10/04/08 24/04/08 08/05/08 BARRY CALLEBAUT 22/05/08 05/06/08 comparable indices 19/06/08 SPI TR 03/07/08 17/07/08 31/07/08 14/08/08 28/08/08 SPI MIDDLE TR 11/09/08 25/09/08 SMI PR 09
Slide 34: Cautionary note
Cautionary note Forward-looking statements Any information given on these slides as well as during the conference call has been prepared by Barry Callebaut solely for the use at this analyst presentation. Certain statements contained therein regarding the business of Barry Callebaut are of a forward