C&C Group PLC · LSE:CCR
C&C — H1 2015 Earnings Presentation
21 slides from C&C's earnings presentation, Oct 29, 2014
Slide 1: H1 2015 Results
H1 2015 Results 29 October, 2014
Slide 2: Disclaimer
Disclaimer This presentation has been prepared solely in connection with the financial results of C&C Group plc (the "Company") for the period ended 31 August, 2014 and should be read in conjunction with the announcement of the financial results of the Company for the period ended 31 August, 2014, r
Slide 3: H1 2015 Review and Market Review and Outlook
H1 2015 Results H1 2015 Review Kenny Neison, CFO Market Review and Outlook Stephen Glancey, CEO C&C Group plc H1 2015 Slide 3
Slide 4: H1 2015 Overview
H1 2015 Overview Financial Net revenue +9.3% to €368.1m Net revenue €368.1m EBIT €69.2m Operating profit (2.7%) to €69.2m FCF €32.9m Pre Exceptional Operating margin 18.8% EPS 15.9 cent Adjusted Diluted FCF of €32.9m pre exceptional: 41% of EBITDA Dividend 4.5 cent Per Share Adjusted dilut
Slide 5: Overview: Segmental Change
H1 2015 Overview Segmental Change Change to segments in line with current organisation structure, business model and management of the Group New Reporting H1 Op. Profit Previously Reported Segment Contribution Under Previously ROI. Now includes Ireland 53% Northern Ireland. 86% Previously the Scot
Slide 6: Segmental Performance
Segmental Performance Ireland Improving economy and consumer sentiment H1 2015 (constant currency) Solid LAD market with On-trade +1%; Tough Net revenue €158.2m (3.9%) comparatives on cider in H1 due to F14 summer EBIT €36.7m +11.6% Ireland underlying volume trends positive Delivery of expec
Slide 7: Segmental Performance: United States
Segmental Performance United States Woodchuck volumes down 29% in H1 H1 2015 (constant currency) Net revenue €19.5m (22.3%) EBIT €0.7m (89.6%) Growth in Magners, Tennent’s and Blackthorn Investment in capacity and brands Resulting high operational gearing drives EBIT decline Brand investme
Slide 8: Segmental Performance: Export
Segmental Performance Export Export volume by geography: H1 2015 (constant currency) Net revenue €13.1m (3.0%) EBIT €2.2m (18.5%) 3% 9% Europe 20% Canada 68% Asia Australia (incl. NZ) Double digit volume growth in Europe and Canada Europe +27% Canada +15% Asia delivering strong growth from
Slide 9: Net revenue and Operating profit
Net revenue and Operating profit Net revenue €m 400 48.1 375 368.1 (11.8) (5.6) (0.4) 350 7.5 336.7 (6.4) 325 300 H1 '14 Currency Ireland Scotland England & Wales US Export H1 '15 Operating profit €m 2.8 80 3.8 75 2.2 (4.2) 71.1 70 69.2 (6.0) (0.5) 65 60 H1 '14 Currency Ireland Scotland England & Wa
Slide 10: Free cash flow
H1 2015 Free cash flow €m 11.8 80 69.2 41% 60 (0.6) EBITDA (19.9) 38% EBITDA (13.6) 40 (5.4) 32.9 30.8 (8.6) (2.1) 20 Operating Dep./Amort. Working Trade lending CapEx Income tax Finance FCF before Exceptional Free cashflow profit capital costs/other exceptionals items Strong Free Cash Flow Conversi
Slide 11: Balance sheet
H1 2015 Balance sheet €m 0.0 (50.0) (100.0) 30.8 (16.4) 0.8 (150.0) (145.2) (13.4) (7.5) (150.9) (200.0) Net debt - 1 Mar Free cash flow Dividends paid Acquisitions Exercise of share Other Net debt - 31 Aug 2014 options 2014 Strong Balance Sheet and Focus on Value Creation Dividend per share of 4.
Slide 12: H1 2015 Review and Market Review and Outlook
H1 2015 Results H1 2015 Review Kenny Neison, CFO Market Review and Outlook Stephen Glancey, CEO C&C Group plc H1 2015 Slide 12
Slide 13: Overview: Strategic & Operating
H1 2015 Overview Strategic & Operating Core businesses delivering sustained earnings growth Operational capability: completion of Gleeson integration; good progress on Wallaces Investment for the future: launch of Clonmel 1650 and Drygate Structural challenges in England & Wales: range of op
Slide 14: Segment Strategy Focus
Segment Strategy Focus Priorities • Differentiated focussed strategy Ireland • Strong brands • Customer focussed • Platform for innovation and third party brands Scotland • Core driver of earnings and cashflow • Strategically important market • Cider is a growing category England & Wales • Consumer
Slide 15: Capital Allocation
Capital Allocation Disciplined approach No change to capital allocation strategy Focus on managing the business for the long term Preference for investing in opportunities that create and sustain shareholder value: Target ROIC above WACC in short to medium term Potential acquisitions evalu
Slide 16: Capital Allocation Five Year Track Record
Capital Allocation 5 Year Track Record (FY10 – FY14) €493m FCF generated €121m returned via dividend €81m debt reduction EBITDA CAGR of 11% EBIT growth of €90m from (FY10) to €127m (FY14) C&C Group plc H1 2015 Slide 16
Slide 17: Vertical Integration: one option to resolve scale issue in E&W
Vertical Integration: one option to resolve scale issue in E&W What do we look for in vertical integration? Strong fundamentals… … to capitalise on the opportunities • Highly capable management team Immediate value creation • Sufficient scale of platform • Distribution of C&C brands in acquired esta
Slide 18: Market Review and Outlook
Market Review and Outlook Outlook Under Takeover Code given the Spirit situation, no new guidance can be given Fundamentals of core markets strong and central to investment case England & Wales strategically important; a range of options being evaluated US current performance disappointing b
Slide 19: Q&A
Q&A Cac group ple 5D”
Slide 20: Segmental analysis
Segmental analysis Net Revenue Change Op. Profit Change Op. Margin Change Volumes Change €m Y-on-Y% €m Y-on-Y% % of Net . Rev ppts Khl Y-on-Y% Ireland 158.2 (3.9%) 36.7 +11.6% 23.2% +3.2ppts 536.8* (3.1%) Scotland 117.7 +69.1% 22.4 +14.3% 19.0% (9.2ppts) 678.6** (1.1%) England & Wales 59.6 (16.5%) 7
Slide 21: FX, Tax & Financing Costs, Pension
FX, Tax & Financing Costs, Pension FX Impact on P&L (average rates) H1 2015 GBP (average rate) 0.811 USD (average rate) 1.364 Tax Effective tax rate 14% Financing Charges Net finance charges of €4.8m Reflects continued low level of variable interest rates Defined Benefit Pension Deficit