Australian Vintage Ltd · ASX:AVG
Australian Vintage — Shareholder Meeting (November 2015)
47 slides from Australian Vintage's shareholder meeting presentation, Nov 17, 2015
Slide 1: Annual General Meeting 17 November 2015
For personal use only ANNUAL GENERAL MEETING 17 NOVEMBER 2015 1
Slide 2: Disclaimer
Disclaimer For personal use only The information in this presentation is general advice, given in good faith and derived from sources believed to be accurate at this date but no warranty of accuracy or reliability is given and no responsibility arising in any other way including by reason of neglige
Slide 3: Annual General Meeting
For personal use only ANNUAL GENERAL MEETING 17 NOVEMER 2015 3
Slide 4: Today's Agenda
Today’s Agenda For personal use only Performance Summary Richard Davis Business Update Neil McGuigan Formal Proceedings Richard Davis 4
Slide 5: Performance Summary
For personal use only PERFORMANCE SUMMARY RICHARD DAVIS 5
Slide 6: Your company
Your company For personal use only 1. One of Australia’s largest wine producers • Crushes 110,000 tonnes a year. • Sells 80 million litres of wine. • 2,900 planted hectares in 11 vineyards. • Production facilities capable of producing 1.5m casks and 6m cases of bottled wine. • Produces one of the mo
Slide 7: Highlights and Key Points
Highlights and Key Points For personal use only 1. Revenue increased 7.5% to $230.9 million versus prior year, reflecting higher branded sales despite anticipated lower bulk and processing sales 2. Net Profit after tax down 11% to $9.4 million versus $ 10.5 million in prior year 3. Net Profit after
Slide 8: Highlights and Key Points (continued)
Highlights and Key Points (continued) For personal use only 6. Net Debt of $104.3 million compared to $111.8 million as at 30 June 2014. Gearing now at 36% 7. Expensed $3.9 million (after tax) in non-recoverable incentives to customers 8. Finalised sale of Yaldara winery for $15.5 million with an af
Slide 9: Continued Strong growth in Branded Sales
Continued Strong growth in Branded Sales For personal use only 1. Total revenue up 7.5% to $230.9 million due mainly to the ongoing improvement in branded sales offset by reduced bulk wine sales and reduced contract processing. 2. Australasia/North America packaged sales up 11% to $99.0 million with
Slide 10: Market Conditions
Market Conditions For personal use only Global conditions remain challenging:- 1. For the period ended September 2015 total Australian wine exports increased by 5% to 734 million litres valued at $2.0 billion (Wine Australia – Wine Export Approval Report). 2. Whilst the Australian dollar has weakene
Slide 11: Australian Wine Industry
Australian Wine Industry For personal use only 1. The 2015 Australian grape crush is 1.67 million tonnes. This figure is just below the 8 year average crush of 1.70 million tonnes. (July 2015 Vintage Report prepared by the Winemakers Federation of Australia). 2. In 2009, total bearing area in vines
Slide 12: Outlook
Outlook For personal use only 1. Global industry conditions remain challenging. 2. In the long term the weakening of the AUD should improve margins and create other profitable opportunities. 3. AVL continues to focus on the core strategies of quality, growing branded business, growing export and mai
Slide 13: Outlook (continued)
Outlook (continued) For personal use only 7. Sales for the first four months to October 2015 are very encouraging with stronger than last year demand and growth. 8. Subject to normal 2016 vineyard yields and forecast FX, we expect our 2016 net profit to be about 10% above last year (before one off i
Slide 14: Business Review
For personal use only BUSINESS REVIEW NEIL MCGUIGAN 14
Slide 15: AVL's Business Strategies
1. AVL’s Business Strategies For personal use only • Growing and strengthening our distribution channels in the China / Asia region, UK and North America. • Building sales and profitability of our core brands both domestically and internationally. • Reviewing and decreasing our cost base. • Creating
Slide 16: FY15 Scorecard
2. FY15 Scorecard For personal use only • Growing and strengthening our profitable distribution channels in the China/Asia region, UK and North America. - China - Increased Asian resources - Increased distribution footprint to all major UK Supermarkets - Added resources to the UK independent sales c
Slide 17: FY15 Scorecard (continued)
2. FY15 Scorecard (continued) • Building sales and profitability of our core brands both domestically For personal use only and internationally. Domestically - McGuigan Brand grew by 15% in the domestic market - Black Label Red continues to be the No 1 branded bottled red wine in Australia - Retaile
Slide 18: FY15 Scorecard (continued)
2. FY15 Scorecard (continued) • Internationally For personal use only - The McGuigan brand has grown 18% globally. China - COFCO’s distribution footprint still growing and emerging. Canada - The McGuigan brand has grown 44.5% in the last 12 months. United Kingdom - The McGuigan brand is now the 2nd
Slide 19: FY15 Scorecard (continued)
2. FY15 Scorecard (continued) For personal use only • Reviewing and decreasing our cost base – Continuing to review long term grape supply leases/contracts to reduce grape cost. – Investment in power reduction at Buronga Hill Winery. * Solar Power * Refrigeration upgrade – Reduction in vineyard wate
Slide 20: For personal use only
For personal use only 20
Slide 21: For personal use only
Schneider mm suRGe DRUM |p ie avo tnt PHEi = PHE
Slide 22: Australian Vintage Ltd
22 AUSTRALIAN VINTAGE LTD
Slide 23: For personal use only
aa | AUSTRALIAN VINTAGE UD
Slide 24: For personal use only
ee LTD STRALIAN VINTAG Al
Slide 25: FY15 Scorecard: New products for emerging markets
2. FY15 Scorecard (continued) For personal use only • Creating new products for developing and emerging markets. – Frizzante – The Shy Pig – Orchard Grove – Tempus Two Silver Series – YOU 25
Slide 26: McGuigan Frizzante
McGUIGAN FRIZZANTE True Australian Style ® A new style of sparkling For more information contact moguiganwinesuk@austrahanvintage.com.au
Slide 27: Shy Pig
i al shy Pig Juicy Red shy Pig Crisp White AVASsTRALIAN VINTAGE Ayasstrauan vince Ay austrauan vince \ Ny AUSTRALIAN VINTAGE LTD
Slide 28: For personal use only
Ox Ox Ox PASSIONFRUIT & PINEAPPLE STRAWBERRIES 3 AND CREAM ~ fi RY ~ “AND cocemur Gh CD covinas == Al STRALIAN VINTAG
Slide 29: For personal use only
PUS. “ © : r © 3 Ay AUSTRALIAN VINTAGE LTD
Slide 30: YOU
YOU YOU FUN FRESH LEAD THE WAY CHAMELEON MANY PEOPLE | eam SEROUS EPIC EXCITE ie FRIENDS FEEL GOOD | FRIENDS IN AWE
Slide 31: Work In Progress: McGuigan awards
3. Work In Progress • Wine Quality and Innovation For personal use only The Show results for the three key brands have been very pleasing again this year. Here are some of the highlights – MCGUIGAN AWARDS – International Wine Challenge, London, 2015: 6 Trophies, 9 Gold, 5 Silver, 18 Bronze – Interna
Slide 32: Work In Progress: Nepenthe and Tempus Two awards
3. Work In Progress (continued) For personal use only NEPENTHE AWARDS - Royal Queensland Food & Wine Show 2014: Trophy Best Sauvignon Blanc of Show - 5* Winery: James Halliday Wine Companion 2014 - James Halliday Wine Companion 2015: Ithaca Chardonnay 2013 – 95 points - Cairns Wine Show 2015: Best P
Slide 33: Work In Progress: Key Points
3. Work In Progress (continued) KEY POINTS For personal use only McGuigan - International Wine and Spirit Competition London 2015 Trophy for Best Semillon of Show for the McGuigan 2006 Bin 9000 Semillon - International Wine Challenge London 2015 6 Trophies, 9 Gold, 5 Silver, 18 Bronze Tempus Two - I
Slide 34: Work In Progress: Retailers and consumers
3. Work In Progress (continued) • Building relationships with all key retailers worldwide For personal use only - AVL relationships with key retailers in the UK and in Australia are stronger than ever. - Working closely with our retail partners is essential to ensure that our sales and marketing pro
Slide 35: Branded Promotional Activities: McGuigan
3. Work In Progress (continued) For personal use only Examples of Branded Promotional Activities include: McGuigan • The launch of the “Bring a McGuigan’ advertising campaign – across cinema, radio and digital. • Sponsorship of the St George Illawarra Dragons NRL team and Port Adelaide Power AFL tea
Slide 36: Branded Promotional Activities: Tempus Two and Nepenthe
3. Work In Progress (continued) For personal use only Tempus Two • Sponsorship of Mercedes Benz Fashion Week Australia (MBFWA) as the Official Wine Partner, increasing nationwide brand awareness. • Leveraging of MBFWA sponsorship to partner with Australian design duo, Aje, for both media and consume
Slide 37: Work in Progress: Not being fast moving consumable goods
3. Work in Progress (continued) For personal use only • Not being Fast Moving Consumable Goods i) Winemaker involvement in the trade and with customers ii) Wine and Food engagement * Lyndey Milan * John Torode • Industry Discussions - Wine Equalisation Tax (WET) rebate changes on bulk wine - Signing
Slide 38: Summary
Summary For personal use only • AVL has a very strong and experienced board that provide very clear strategies to management. • AVL continues to focus on cost base to ensure it is appropriate for the size of its business. • AVL’s branded business, private label, exclusive label business and contract
Slide 39: Formal Proceedings
For personal use only FORMAL PROCEEDINGS RICHARD DAVIS 39
Slide 40: Accounts
Accounts For personal use only “To consider and receive the Financial Report, the Directors’ Report and the Auditor’s Report of the Company for the year ended 30 June 2015.” 40
Slide 41: Resolution: Election of John D Davies
Resolution 1 For personal use only • To consider and if thought fit, pass as an ordinary resolution: “That John D Davies is elected as a non-executive Director of the Company.” 41
Slide 42: Resolution: Election of Naseema Sparks
Resolution 2 For personal use only • To consider and if thought fit, pass as an ordinary resolution: “That Naseema Sparks is elected as a non-executive director of the Company” 42
Slide 43: Resolution: Re-election of Richard H Davis
Resolution 3 For personal use only • To consider and if thought fit, pass an ordinary resolution: “That Richard H Davis is re- elected as a non-executive director of the Company” 43
Slide 44: Resolution: Remuneration Report
Resolution 4 For personal use only • To consider and if thought fit, pass an ordinary resolution: “That the Remuneration Report of the Company for the year ended 30 June 2015 be adopted.” 44
Slide 45: Resolution: Performance Rights and Option Plan
Resolution 5 For personal use only • To consider and if thought fit, pass an ordinary resolution: “That approval is given for as required by the Corporations Act and the Australian Stock Exchange (‘ASX’) Listing Rules (‘LR’) for: 1. The continuation of the AVG Performance Rights and Option Plan (‘Pl
Slide 46: Resolution: Options grant to CEO
Resolution 6 For personal use only • To consider and if thought fit, pass an ordinary resolution: “That approval is given as required by the Corporations Act and ASX Listing Rules for: 1. The grant of 2,000,000 Options under the Plan to the CEO and Executive Director, Neil McGuigan, in accordance wi
Slide 47: For personal use only
For personal use only 47
Australian Vintage — Shareholder Meeting (November 2015) on 6ix