East African Breweries Plc · NSEKE:EABL

East African Breweries — H1 F22 Earnings Presentation

42 slides from East African Breweries's earnings presentation, January 2022

  1. Slide 1: EABL F22 Half Year Results

    EABL F22 HALF YEAR RESULTS January 2022 * Confidential-Diageo Recipients Only *

  2. Slide 2: Agenda

    AGENDA F22 Business Review F22 Financial Review Looking Ahead Q&A * Confidential-Diageo Recipients Only *

  3. Slide 3: 100 Years of Creating Value

    100 YEARS OF CREATING VALUE EABL listed on the Listed as a public company Nairobi stock exchange 1934 1954 1922 1946 Incorporated as a private company Birth of Uganda Breweries Ltd. and the first beer brewed. * Confidential-Diageo Recipients Only *

  4. Slide 4: 100 Years of Creating Value

    100 YEARS OF CREATING VALUE Diageo PLC acquires majority control of EABL Senator launched 2000 2004 1972 2001 EABL completes the largest public First woman appointed to the issue in Kenya’s history EABL board * Confidential-Diageo Recipients Only *

  5. Slide 5: 100 Years of Creating Value

    100 YEARS OF CREATING VALUE Acquires Serengeti Breweries (SBL) Issues Kshs 11bn medium term note 2010 2021 2005 2018 2022 Set up EABL Foundation Kisumu brewery recommissioned EABL Centenary * Confidential-Diageo Recipients Only *

  6. Slide 6: EABL Is Emerging Stronger

    EABL IS EMERGING STRONGER Delivered an exceptional half, grew the top line fast and bottom line faster Consumer at the heart of our commercial execution and brand plans Increased investment in our iconic brands, capacity and people Continued progress on our society 2030 sustainability goals Creating

  7. Slide 7: Great Performance Across Key Metrics

    GREAT PERFORMANCE ACROSS KEY METRICS % vs same period last year (SPLY) NSV Profit After Tax +23% +131% Kes 54.9bn Kes 8.7bn Free Cash Flow Interim Dividend +26% 3.75 Kes Kes 6.3bn * Confidential-Diageo Recipients Only *

  8. Slide 8: Macro Indicators Improving

    MACRO INDICATORS IMPROVING Kenya Uganda Tanzania Currency gains in UG & TZ, GDP growth bouncing back in 2021 Inflation remains moderate deterioration in KE 5.6% 4.7% 6.7% 2.9% 4.4% 4.8% 4.8% 5.9% 6.0% 2.1% 4.0% 5.3% 2.6% 1.2% 3.9% 4.1% 0.7% -0.6% 0.6% 3.1% 3.4% 1.2% 0.0% -0.7% -0.5% -0.9% -0.6% -0.3

  9. Slide 9: Keeping Close to Our Consumer Through Dynamic, Always-On Research

    KEEPING CLOSE TO OUR CONSUMER THROUGH DYNAMIC, ALWAYS-ON RESEARCH CONSUMER CATEGORY • Desire to drink ‘better’ • Beer recovering • Digitization • Spirits growth momentum • Covid-19 anxiety decreasing continuing OCCASION CHANNEL • Skew towards intimate and familiar occasions • On trade consumption ri

  10. Slide 10: Our Strategy

    OUR STRATEGY To create the best performing, most trusted and respected Ambition consumer products company in Africa Strategic Explode Win in Shape New Vibrant Beer Mainstream imperatives Premium Frontiers Spirits Aspirational and Accessible Innovations Digital Transformation Key enablers Efficient R

  11. Slide 11: Upweighted Marketing Investment and Focussed Commercial Execution

    UPWEIGHTED MARKETING INVESTMENT AND FOCUSSED COMMERCIAL EXECUTION World class brand building Digital transformation Premiumisation Winning across channels Culturally present brands across Platforms, tools and analytics Portfolio pitched to help consumers Recover On trade whilst continue categories a

  12. Slide 12: Vibrant Innovation Pipeline Driving Sustainable Growth

    VIBRANT INNOVATION PIPELINE DRIVING SUSTAINABLE GROWTH Increased participation in Spirits Expanded formats Refreshed portfolio New launches fueling growth Product extension unlocking new Formats to recruit new consumers momentum in spirits consumption occasions * Confidential-Diageo Recipients Only

  13. Slide 13: Stellar Performance Across Our Strategic Imperatives

    STELLAR PERFORMANCE ACROSS OUR STRATEGIC IMPERATIVES Vibrant beer Explode mainstream spirits +17% +25% +25% vs F19 +56% vs F19 Win in premium Shape new frontiers +18% +30% vs F19 +49% +28% vs F19

  14. Slide 14: Solid Double Digit Growth Across All Our Markets

    SOLID DOUBLE DIGIT GROWTH ACROSS ALL OUR MARKETS NSV growth vs LY 27% 23% 18% 15% Kenya Uganda Tanzania EABL Key brands * Confidential-Diageo Recipients Only *

  15. Slide 15: Diversified Geographic Mix

    DIVERSIFIED GEOGRAPHIC MIX Net sales value contribution by Market Tanzania 11% 12% 13% 16% 15% Uganda 16% 16% 16% 18% 18% Kenya 72% 72% 71% 66% 68% F18 F19 F20 F21 F22 * Confidential-Diageo Recipients Only *

  16. Slide 16: Strong Recovery

    STRONG RECOVERY Bottled Beer +17% Mainstream Spirits Premium Spirits +25% +20% +27% Senator Total Spirits +49% +25% Net sales growth vs SPLY * Confidential-Diageo Recipients Only *

  17. Slide 17: Sustained Double-Digit Growth

    SUSTAINED DOUBLE-DIGIT GROWTH Premium beer +16% Mainstream Beer Scotch +46% +15% +18% Total Spirits +13% Net sales growth vs SPLY * Confidential-Diageo Recipients Only *

  18. Slide 18: Continued Growth Momentum

    CONTINUED GROWTH MOMENTUM Mainstream Beer +13% Scotch Guinness +43% +157% +15% Total Spirits +52% Net sales growth vs SPLY * Confidential-Diageo Recipients Only *

  19. Slide 19: Strategic Investments Driving Growth

    STRATEGIC INVESTMENTS DRIVING GROWTH Kisumu Brewery - Kenya Capacity Expansion – Moshi, Tanzania KES KES 14.9bn 5.7 bn *ongoing Capacity Expansion – Uganda Spirits Cube – Tanzania KES KES 3.7bn 0.7bn * Confidential-Diageo Recipients Only *

  20. Slide 20: Society 2030: Spirit of Progress

    SOCIETY 2030: SPIRIT OF PROGRESS

  21. Slide 21: Delivering on Our Society 2030 Goals

    DELIVERING ON OUR SOCIETY 2030 GOALS • SBL all women Cube line  DRINKiQ visits increased from 10,921 in 2021 to 74,220 in H1 • 18% senior leadership roles are women, +4% from LY  Reached >13m with messages of moderation • Women make up 65% of our community training programmes, +11% vs LY Source: E

  22. Slide 22: Doing Business the Right Way, From Grain to Glass

    DOING BUSINESS THE RIGHT WAY, FROM GRAIN TO GLASS • Replenished & reused a total of 144,294m³ • Biomass expected to deliver 42kt reduction • UBL new Returnable Glass Bottle Line, • Over 36k beneficiaries of our water projects • Reduced water used per packaged product resourced by 75% females. reache

  23. Slide 23: KES 0.6bn Invested Towards Our Society 2030 Pillars So Far

    KES 0.6BN INVESTED TOWARDS OUR SOCIETY 2030 PILLARS SO FAR COMMUNITY SUPPORT •  24,340 women enrolled in community Over 100 Kilimo Viwanda Agro-Scholarships  UBL Sanitation block donation to the in TZ programmes (skills and WASH). Nnabagereka Foundation. • 1,142 trained in Learning for Life progra

  24. Slide 24: KES 0.6bn Invested Towards Our Society 2030 Pillars So Far

    KES 0.6BN INVESTED TOWARDS OUR SOCIETY 2030 PILLARS SO FAR COMMUNITY SUPPORT • RTB launched across East Africa. • Launched in Dar on 30th June 2021. • Kenya - 12,991 people vaccinated at host locations across 5 counties: Nairobi, Kisumu, Mombasa, Nakuru and Naivasha. • AMREF Partnership + Training a

  25. Slide 25: Investing in Our People

    INVESTING IN OUR PEOPLE Talent Engagement Learning • Gender representation (31% • Cross functional mindset driving • Functional training programs female) collaboration • Continuous learning via My • Strong succession pipeline • Employee resource groups - Learning Hub • Reward & Recognition Spirited

  26. Slide 26: 31 Awards Across the Business

    31 AWARDS ACROSS THE BUSINES Cheers to Our Next 100 * Confidential-Diageo Recipients Only *

  27. Slide 27: Thank You

    Thank You Please hold questions to the end * Confidential-Diageo Recipients Only *

  28. Slide 28: F22 H1 Financial Performance

    F22 H1 FINANCIAL PERFORMANCE • EABL Overview • Key Financial Performance Metrics • Working Capital • Capex * Confidential-Diageo Recipients Only *

  29. Slide 29: Best Performance in Over Five Years

    BEST PERFORMANCE IN OVER FIVE YEARS Net Sales EBIT GM% EBIT% 50 100 150 200 +20% +21% +23% +94% 200 20 54.9bn 15.1bn 45.9bn 44.5bn 12.4bn 47.6% 43.5% 48.2% 7.8bn 27.1% 17.5% 27.5% 0 0 0 F20 H1 F21 H1 F22 H1 F20 H1 F21 H1 F22 H1 EPS Operating Cash Conversion +10% 137% +212% 101% 99% 10 8.5 60 7.0 40

  30. Slide 30: Back on Track

    BACK ON TRACK +9% CAGR +9% GM% CAGR +23% EBIT% 54.9bn Pre-Covid 55 Post-Covid 50 45.9bn 44.5bn 45 41.6bn 40 36.8bn 35.2bn 35 30 47.2% 47.6% 48.2% 25 46.1% 43.4% 43.5% 20 15 10 27.2% 25.1% 23.4% 27.1% 27.5% 5 17.5% 0 F17 H1 F18 H1 F19 H1 F20 H1 F21 H1 F22 H1 * Confidential-Diageo Recipients Only *

  31. Slide 31: Sustainable Margin Expansion

    SUSTAINABLE MARGIN EXPANSION 2.6% 27.5% GM expansion of 4.7% 2.3% 0.4% 2.9% 1.6% 0.0% 3.2% -1.2% -1.8% 17.5% EBIT% Volume Mix Price Inflation Productivity Selling & Administrative Fx Other OIE EBIT% H1 F21 benefits Distribution Efficiencies H1 F22 Reinvestment * Confidential-Diageo Recipients Only *

  32. Slide 32: Profits Growing Ahead of Revenues

    PROFITS GROWING AHEAD OF REVENUES Kes bn F22 H1 F21 H1 vs F21 Net Sales 54.9 44.5 23% Cost of Sales (28.4) (25.1) 13% Gross Profit 26.5 19.3 37% Expenses (11.4) (11.6) (2%) EBIT 15.1 7.8 94% Net Finance Cost (2.2) (1.9) 15% Profit Before 12.9 5.8 121% Tax Income Tax (4.1) (2.0) 103% Profit After Tax

  33. Slide 33: Strong Balance Sheet

    STRONG BALANCE SHEET Current Assets Current Liabilities +14% +12% 3.1 1.0 38.9 1.5 44.6 4.1 34.1 0.8 39.7 0.6 0.1 FY21 Inventories Trade and Other F22 H1 FY21 Trade and Borrowings Bank Other F22 H1 other other overdraft receivables payables Non-current Assets Non-current Liabilities +8% 6.2 -10% 1.4

  34. Slide 34: Strong Key Ratios

    STRONG KEY RATIOS Net Debt vs EBITDA EBIT / Interest Board Target: <1.5 Board Target: >4.0 6.8 2.5 7 6.3 0.10 2.1 2.1 2.0 6 0.08 1.5 5 4.5 1.5 0.06 1.0 1.0 4 3.8 3.8 1.0 0.04 3 0.5 0.02 0.0 0 0.00 F18 F19 F20 F21 F22 est. F18 F19 F20 F21 F22 est. Current Ratio ROCE Board Target: >0.8 50 46% 0.10 40%

  35. Slide 35: Reduced Leverage

    REDUCED LEVERAGE -15% 40.7bn 39.3bn 30 34.7bn 25 27.5bn 23.9bn 12.8% 13.2% 15 9.5% 9.4% 9.9% 10 5 0 FY18 FY19 FY20 FY21 F22 H1 EIR * Confidential-Diageo Recipients Only *

  36. Slide 36: Strong Cash Flow Generation

    STRONG CASH FLOW GENERATION Net cash generated from operations = Kes 17.6bn 17.8 -0.2 -2.0 -3.0 -6.3 0.2 7.2 4.4 -3.7 C&CE as at Cash from Changes Net Income Net cash used Net cash used Fx impact on C&CE as at 1 July 2021 ops. before in W/C interest tax paid in investing in financing translation Dec

  37. Slide 37: Investing Ahead

    INVESTING AHEAD Total capex spend Capex spend by category Environment Safety +51% 7 20 2% 6.2bn Returnables 2% 6 19% 5 4.4bn 4.1bn 4 10 3 61% Maintain 16% Capacity 2 current Ops Expansion 1 0 0 F20 H1 F21 H1 F22 H1 * Confidential-Diageo Recipients Only *

  38. Slide 38: Looking Ahead

    LOOKING AHEAD • Centenary • F22 H2 Priorities * Confidential-Diageo Recipients Only *

  39. Slide 39: F22 H2 Priorities

    F22 H2 PRIORITIES  Growth  Margins  Cost Efficiency  Society 2030  People * Confidential-Diageo Recipients Only *

  40. Slide 40: Q&A Session

    Q&A SESSION * Confidential-Diageo Recipients Only *

  41. Slide 41: Cautionary statement concerning forward-looking statements

    Cautionary statement concerning forward-looking statements This document contains ‘forward-looking’ statements. These statements can be identified by the fact that they do not relate only to historical or current facts. In particular, forward-looking statements include all statements that express fo

  42. Slide 42: * Confidential-Diageo Recipients Only *

    * Confidential-Diageo Recipients Only *

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