Monster Beverage Corporation · NASDAQ:MNST
Monster Beverage — Merger or Acquisition (January 2015)
53 slides from Monster Beverage's merger presentation, Jan 13, 2015
Slide 1: Monster Corporation
MONSTER CORPORATION Que ]
Slide 2: Forward-looking statements
Certain statements made in this presentation may constitute "forward-looking statements" within the meaning of the U.S. federal securities laws, regarding the expectations of management with respect to Monster’s future operating results and other future events including revenues and profitability. M
Slide 3: Coca-Cola Transaction Overview
Coca-Cola Transaction Overview The Coca-Cola Company (KO) will purchase an approximately 16.7% equity stake in Monster KO will contribute its energy portfolio to Monster, and Monster its non-energy portfolio to KO Monster will become a pure play global energy drinks company KO will expand the Monste
Slide 4: Coca-Cola Transaction Overview (Cont'd)
Coca-Cola Transaction Overview (Cont’d) Beginning Structure Pro Forma Structure KO Public Shareholders Monster Public Shareholders KO Public Shareholders Monster Public Shareholders KO Monster KO Monster KO Non-Energy Monster Energy Monster Non-Energy Monster Non-Energy Monster Energy KO Non-Energy
Slide 5: Coca-Cola Transaction Rationale
Coca-Cola Transaction Rationale Secures fully aligned access to KO’s leading global distribution system and provides opportunity to accelerate Monster’s international performance Enhances route-to market strength in countries where Monster has an existing presence Accesses new countries through KO’s
Slide 6: The Coca-Cola Company Energy Portfolio Overview
The Coca-Cola Company Energy Portfolio Overview * Leading portfolio of energy brands Achieved ~$330mm in Net Sales in 2013 Operates as a concentrate model International 2013 Net Sales Source: The Coca-Cola Company management. Note: Brand portfolio also includes BU (Papua New Guinea), Gladiator (Russ
Slide 7: Brands Transferred
Brands Transferred From The Coca-Cola Company to Monster From Monster to The Coca-Cola Company Concentrate Business Model ~$330mm 2013 Net Sales ~$150mm 2013 Net Sales New Distribution Agreements Source: Monster management, The Coca-Cola Company management.
Slide 8: International Monster Pro Forma Impact
International Monster Pro Forma Impact Product Portfolio and Geography Standalone Monster Source: Monster management, The Coca-Cola Company management. Note: All figures based on 2013 Net Sales in Dollars. North America Pro Forma Monster Non-Energy Energy Energy International North America 93% 7% 10
Slide 9: Monster Pro Forma Impact (Cont'd)
Monster Pro Forma Impact (Cont’d) Current Monster Pro Forma Monster 2013 Net Sales 2013 Operating Income (1) 3Q 2014 Cash Balance (2) Source: Monster management, The Coca-Cola Company management. 1. Monster financials have been adjusted for one-off items such as distributor termination expenses and
Slide 10: Beverage Landscape
Beverage Landscape U.S. Energy Drink Category at 5.5% YTD Growth is outpacing total Beverage category growth of 1.9% *Source: Nielsen AMC YTD M/E 12.27.14
Slide 11: Monster is leading growth in the Energy Category
Monster is leading growth in the Energy Category, up +9.4% vs Total NA Energy +6.1%. Monster has gained 1.1 share points, to become the #1 brand in the Category with 35.2% $ Share. Both NOS and Full Throttle are also showing strong sales momentum versus previous year. Brand Performance - Total U.S.
Slide 12: Brand Performance – Total US All Channels/Units
Brand Performance – Total US All Channels/ Units AMC Conv Food Drug Mass incl WM U Vol U Vol Year Ago U % ? vs Year Ago U ? vs Year Ago U Share U Share ? vs Year Ago TNA TOTAL NON-ALCOHOL ENERGY 976,641,662 917,705,154 6.4% 58,936,508 100.0% 0.0 1 TOTAL MONSTER 362,010,648 329,459,767 9.9% 32,550,88
Slide 13: Energy Category: Dollar Share – All Measured Channels
Energy Category: Dollar Share – All Measured Channels Source: AC Nielsen Total US All Measured Channels – 5 Weeks Ending 12.27.14
Slide 14: Energy Category: Unit Share – All Measured Channels
Energy Category: Unit Share – All Measured Channels Source: AC Nielsen Total US All Measured Channels – 5 Weeks Ending 12.27.14
Slide 15: Brand Performance – Convenience/Dollars
Brand Performance- Convenience/ Dollars Convenience $ Vol $ Vol Year Ago $ % ? vs Year Ago $ ? vs Year Ago $ Share $ Share ? vs Year Ago TNA TOTAL NON-ALCOHOL ENERGY 1,915,261,731 1,807,087,508 6.0% 108,174,223 100.0% 0.0 1 TOTAL MONSTER 688,622,410 631,587,738 9.0% 57,034,672 36.0% 1.0 2 TOTAL RED
Slide 16: Brand Performance – Convenience/Units
Brand Performance – Convenience/ Units Convenience U Vol U Vol Year Ago U % ? vs Year Ago U ? vs Year Ago U Share U Share ? vs Year Ago TNA TOTAL NON-ALCOHOL ENERGY 767,172,798 720,385,480 6.5% 46,787,318 100.0% 0.0 1 TOTAL MONSTER 294,542,623 266,564,439 10.5% 27,978,184 38.4% 1.4 2 TOTAL RED BULL
Slide 17: Energy Category: Dollar Share – Convenience
Energy Category: Dollar Share - Convenience Source: AC Nielsen Total US Convenience – 5 Weeks Ending 12.27.14
Slide 18: Energy Category: Unit Share – Convenience
Energy Category: Unit Share - Convenience Source: AC Nielsen Total US Convenience – 5 Weeks Ending 12.27.14
Slide 19: Combined Brand Portfolio
Combined Brand Portfolio Monster Energy Company will now have a portfolio of brands with different positionings to compete in both premium and price segments.
Slide 20: Current Monster Energy Global Distribution
Current Monster Energy Global Distribution
Slide 21: Distribution of at least one MEC brand following KO Transaction
Distribution of at least one MEC brand following KO Transaction
Slide 22: Energy Portfolio
Energy Portfolio
Slide 23: Energy Portfolio – Asia Pacific
Energy Portfolio Asia Pacific ® p ae.
Slide 24: Energy Portfolio – North America
Energy Portfolio Ye North America Key: {/] i) ii Nos
Slide 25: Energy Portfolio – Africa
Energy Portfolio Africa
Slide 26: Selected Market: Great Britain
Selected Market: Great Britain Source: Nielsen Total GB market data to 12.2.14* Tesco Express new shelf layout Last Last 13 Weeks 4 weeks Energy Category Value Growth + 3.1% + 3.9% Monster Value Growth +15.1% + 34.8% Monster Value Share 12.3% 13.5% Relentless Value Growth + 7.6% - 8.0% Relentless Va
Slide 27: Selected Market: Germany
Source: Nielsen data Germany retail channel 11.2.14 Grocery: Rewe Supermarket Last Last 13 Weeks 4 weeks Energy Category Value Growth + 7.7% + 5.5% Monster Value Growth + 33.8% + 42.3% Monster Value Share 10.4% 11.3% Relentless Value Growth + 8.9% + 9.4% Relentless Value Share 5.1% 4.9% Total Monste
Slide 28: Selected Market: Spain
Source: Nielsen data total Spanish Market to 11.2.14 Selected Market: Spain Grocery: Carrefour Maquinista, Barcelona Last Last 13 Weeks 4 weeks Energy Category Value Growth + 3.4% + 5.7% Monster Value Growth + 3.6% + 2.9% Monster Value Share 22.5% 22.2% Burn Value Growth + 9.9% + 8.4% Burn Value Sha
Slide 29: Selected Market: Greece
Energy Category Value Growth Monster Value Growth Monster Value Share Source: IRI total Greek market data 10.31.14 Selected Market: Greece Athens Convenience Grocery: AB Vasilopoulos – Athens Last 13 Weeks + 4.4% + 26.5% 28.9% Last 4 Weeks + 1.7% +23.7% 29.3% 21.8% 26.9% 28.9% Monster Value Share
Slide 30: Selected Market: Belgium
Source: Nielsen data Belgium Retail channel to end of 10.31.14 Selected Market: Belgium Grocery : Carrefour, Korbeek-Lo Last Last 13 Weeks 4 weeks Energy Category Value Growth + 12.1% + 22.1% Monster Value Growth + 13.5% + 24.3% Monster Value Share 8.0% 7.7% Nalu Value Growth +16.0% + 22.2% Nalu Val
Slide 31: Selected Market: Brazil
Selected Market: Brazil 3- Months Ending November 2014 November 2014 Energy Category Growth - 2.6% - 1.6% Monster Value Growth + 45.0% + 36.5% Monster Value Share 5.7% 5.7% Burn Value Growth - 0.7% - 3.5% Burn Value Share 10.3% 10.1% Total Monster Energy Company 16.0% 15.8% value share following KO
Slide 32: Selected Market: Mexico
Selected Market: Mexico 3- Months Ending October 2014 October 2014 Energy Category Growth + 11.2% + 9.7% Monster Value Growth + 9.5% + 4.2% Monster Value Share 33.5% 33.2% Burn & Gladiator Value Growth - 35.3% - 37.1% Burn & Gladiator Value Share 6.3% 6.3% Total Monster Energy Company 39.8% 39.3% va
Slide 33: Global Properties
Global Properties Formula 1 – Factory Mercedes Lewis Hamilton 2014 World Champion MotoGP – Factory Yamaha Valentino Rossi 9 time World Champion Major X Games Sponsor Team Evil Genius - eSports
Slide 34: U.S. Properties
U.S. Properties Kyle Busch Most Winning Nation Wide Driver Supercross – Factory Kawasaki Ryan Villopoto 4-time World Champion Bellator MMA Monster Energy Big Ticket Music Festival
Slide 35: EMEA Properties
EMEA Properties Liam Doran World Rally Title Sponsor MotoGP Le Mans Title Sponsor – GROEZROCK Festival Meerhout, Belgium, Europe’s Biggest Punk and Hardcore Festival Greg Hancock Speedway Champion
Slide 36: Brazil Properties
Brazil Properties Professional Bull Riders Series Sponsor Motocross Series Sponsor Filipe Toledo – ASP Event Champion Atila Abrea Stock Car
Slide 37: Japan Properties
Japan Properties Toyota Big Air Sponsor Taka – Dominant Free Style Champion Subway Take-Over: Connecting with 20 million Commuters Maximum the Hormone Heavy Metal Band
Slide 38: Media
Media Ken Block – Gymkhana 7 22.8 million views1 (all related videos) ABC “World of X” – Integration into 38 Episodes Live ESPN Cam Zink World Record Back Flip 101 Million total YouTube Views Source: 1 Youtube.com as of 1.12.2015
Slide 39: Social Media
Social Media 25 Million Facebook Fans 4th largest Beverage Brand 1.4 Million Instagram Followers #3 Beverage Brand2 2.0 Million Twitter Followers #3 Beverage Brand1 Larger following than Red Bull 9th largest Beverage/FMCG Food Brand on Facebook1 (and we don’t buy likes) Source: 1SocialBakers.com as
Slide 40: U.S. Retail Promotions - 2015
U.S. Retail Promotions - 2015 Trimester 1 Bellator MMA & Rampage Jackson Trimester 2 Major Theatrical Release Trimester 3 Ultimate Gaming Experience (Tentative)
Slide 41: EMEA Retail Promotions - 2015
EMEA Retail Promotions - 2015 Q1 MotoGP Q2 Formula 1 Q3 Point Break Theatrical Release Q4 Ultimate Gaming Experience (Tentative)
Slide 42: Japan Retail Promotions - 2015
Japan Retail Promotions - 2015 Q4 MotoGP Q2 Music Festival Ticket Give-Away Q3 Monster Energy Gear Program Late Q1 Video Game Tie-In
Slide 43: Rossi: Promo to Permanent
Rossi: Promo to Permanent Rossi #2 Monster SKU in One Stop with a Rate of Sale 60% of Monster Energy 500ml. Promotional package featuring nine-time MotoGP World Champion Valentino Rossi. Launched in May 2014 as a limited time offering. After strong consumer acceptance, became a permanent SKU for EME
Slide 44: New Products
New Products 1/14 5/14 Exclusive 7-Eleven 9/14 10/14 11/14 2/15 2/15 Packing Refresh 9/14 10/14
Slide 45: Solid Financial Results
Solid Financial Results 22 consecutive years of increased sales the since acquisition of the Hansen beverage business in 1992. Achieved $2.25 billion in net sales in 2013, up 9.0% over net sales of $2.06 billion in 2012. For the nine months ended September 30, 2014, achieved $1.86 billion in net sal
Slide 46: Monster Beverage Corporation Net Sales
Monster Beverage Corporation Net Sales ($ in millions) 35.1% CAGR to December 2013 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 YTD 9/30 2013 YTD 9/30 2014 $110.4 $180.3 $348.9 $605.8 $904.5 $1,033.8 $1,143.3 $1,303.9 $1,703.2 $2,060.7 $2,246.4 $1,705.6 $1,859.3
Slide 47: Reported Operating Income
Monster Beverage Corporation Reported Operating Income ($ in millions) 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 YTD 9/30 2013 YTD 9/30 2014 $9.8 $33.9 $103.4 $158.6 $231.0 $163.6 $337.3 $347.8 $456.4 $550.6 $572.9 $438.2 $554.6
Slide 48: Adjusted Operating Income
Monster Beverage Corporation Adjusted Operating Income (“OI”) ($ in millions) Reported OI $9.8 $33.9 $103.4 $158.6 $231.0 $163.6 $337.3 $347.8 $456.4 $550.6 $572.9 $438.2 $554.6 *Adjustments 16.5 25.0 117.9 - 2.8 - 1.8 1.1 3.5 28.7 23.9 17.5 Adjusted OI $9.8 $33.9 $103.4 $175.1 $256.0 $281.5 $334.5
Slide 49: Reported Net Income
Monster Beverage Corporation Reported Net Income ($ in millions) 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 YTD 9/30 YTD 9/30 $5.9 $20.4 $62.8 $97.9 $149.4 $108.0 $208.7 $212.0 $286.2 $340.0 $338.7 $262.6 $357.9
Slide 50: Reported Diluted Earnings Per Share
Monster Beverage Corporation Reported Diluted Earnings Per Share As adjusted for Stock Splits 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 YTD 9/30 2013 YTD 9/30 2014 $0.04 $0.11 $0.33 $0.50 $0.76 $0.55 $1.10 $1.14 $1.53 $1.86 $1.95 $1.51 $2.06
Slide 51: Balance Sheet Highlights
Monster Beverage Corporation Balance Sheet Highlights ($ in thousands) September 30, 2014 December 31, 2013 Percentage Change Cash and cash equivalents $ 408,323 $ 211,349 93% Investments: Short-term investments $ 588,041 $ 402,247 46% Long-term investments $ 28,419 $ 9,792 190% Total Investments $
Slide 52: 3rd Quarter Results
Monster Beverage Corporation 3rd Quarter Results (in millions except per share data) 3Q13 3Q14 $590.4 $636.0 Reported Net Sales 7.7% 3Q13 3Q14 $151.4 $189.9 Reported Operating Income 25.4% 3Q13 3Q14 $92.2 $121.6 Reported Net Income 31.9% 3Q13 3Q14 $0.53 $0.70 Reported Diluted EPS 31.7%
Slide 53: Monster Corporation
MONSTER CORPORATION Que ]
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