Coca-Cola Icecek A.S. · BIST:CCOLA
Coca-Cola Icecek A.S — Ak Yatırım Turkey Investor Conference 2012
37 slides from Coca-Cola Icecek A.S's conference presentation, Nov 15, 2012
Slide 1: Ak Yatırım Turkey Investor Conference
Ak Yatırım Turkey Investor Conference November 15, 2012 Istanbul
Slide 2: Agenda
Business Overview & Strategy Operational Review Financial Review Appendix
Slide 3: Coca-Cola İçecek
Coca-Cola İçecek Operations across 10 countries including Shareholding Structure Turkey, Central Asia, Middle East & Pakistan Publicly Held Production, sale and distribution of 25.6% Anadolu Efes (1) sparkling and still beverages of The Coca- TCCC (2) 20.1% 50.3% Cola Company Özgörkey 4.0% Listed in
Slide 4: At a Glance
At a Glance Operating in some of the world’s least saturated markets Capitalizing on favorable demographic and economical drivers Offering exposure to significant future growth potential Delivering stellar profitable growth 16 5 9 5 74 7 21 33 6 178 Turkey Region: 8 plants International Operations:
Slide 5: Drivers of Growth – Demand & Demographics
Drivers of Growth – Demand & Demographics Per Cap Consumption in Liters (2011) 180 Mexico 160 USA 140 Argentina 120 Germany 100 Kuwait Bulgaria UK 80 Saudi Arabia U.A.E Spain S. Africa Hungary 60 Oman Libya Poland Greece Jordan Turkey Qatar Italy 40 Egypt Russia Iraq Kazakhstan Syria Turkmenistan 20
Slide 6: Successful Expansion Model
Successful Expansion Model # of Countries 318 mn UC 762 mn UC 10 1 Pakistan - 2008 2004 2011 Syria - 2007 Population Served N. Iraq - 2006 (mn) 356 71 275 mn UC 2004 2011 Operating Plants 20 5 2004 2005 2011 2004 2011 6
Slide 7: Strong Delivery on the Market Potential
Strong Delivery on the Market Potential Consolidated Sales Volume Consolidated Net Sales Consolidated EBITDA (million unit case) (TL in millions) (TL in millions) 762 3.409 487 275 1,032 142 2004 2011 2004 2011 2004 2011 7
Slide 8: Geography and Category Split
Geography and Category Split Volume split (uc) - Geography Revenue Split 2005 2011 2005 2011 Volume split (uc) - Category EBITDA Split 2005 2011 2005 2011 8
Slide 9: Understanding Consumer Behavior
Understanding Consumer Behavior Turkey Central Asia Pakistan Minute Maid Pulpy Kazakhstan Kazakhstan COKE 3L Fanta Buratino Fanta Dushes Ramadan Sherbet Kazakhstan Azerbaijan Azerbaijan Cappy Pulpy Fanta Lemon Lemonade Fanta Green Apple Fanta Dushes 9
Slide 10: Market Shares and Positions in Key Markets – 2011
Market Shares and Positions in Key Markets – 2011 Turkey Pakistan Kazakhstan Azerbaijan 70% 28% 37% 57% #1 #2 #1 #1 25% 1% 7% 5% #1 #8 #3 #5 9% 11% 8% 51% #2 #3 #3 #1 Source: Nielsen 10
Slide 11: Iraq becomes 2nd largest market internationally
Iraq becomes 2nd largest market internationally CCI’s Iraqi operations started in 2006 in Northern Iraq On September 21, 2012, the acquisition process of Al Waha Beverages, active in South Iraq was completed CCI’s effective shareholding in Al Waha is ca. 65% NARTD market is estimated to be 425 mn un
Slide 12: Agenda
Business Overview & Strategy Operational Review Financial Review Appendix
Slide 13: 9M12 Review
9M12 Review High-single volume growth Both sparkling and still categories posted strong growth at high single and low double digits, respectively Improved discount and category management Stable input cost environment 13
Slide 14: Volume up by 9% in 9M12
Volume up by 9% in 9M12 Turkey Volume International Volume Consolidated Volume (Unit cases in millions) (Unit cases in millions) (Unit cases in millions) 449.9 459.6 676.7 621.1 217.1 171.3 9M11 9M12 9M11 9M12 9M11 9M12 Consolidated up by 6.6% to 282.0 million uc 3Q12 Turkey up by 0.2% to 191.3 mill
Slide 15: 9M12 Sales Volume Breakdown
9M12 Sales Volume Breakdown Volume split (uc) - Geography Volume split (uc) – Consolidated 9M11 9M11 Tea 8.0% Int'l 27.6% Still 21.2% Turkey Sparkling 72.4% 70.8% 9M12 9M12 Tea 7.3% Int'l 32.0% Still 21.6% Turkey Sparkling 68.0% 71.1% 15
Slide 16: Turkey
Turkey Turkey volume up 2.1% in 9M12 Sparkling and still posted growth at low single and high single digits Focus on category and packaging mix Fanta Pet 300 ml Coca-Cola Pet 300 ml Fanta Can 200 ml Fuse Tea Cappy 100% Orange/Apple/Apple- Peach/Lemon Peach/Apple-Mix OWB 250ml OWB 250ml 16
Slide 17: International Operations
International Operations Volume split (uc) – Int’l All key markets posted strong volume growth in 9M12 Pakistan volume growth 24% Kazakhstan growth 30% Azerbaijan growth 17% Iraq growth 50% Fanta Armyt Minute-Maid Burn Fresh Turkmenistan Pakistan Azerbaijan 17
Slide 18: Agenda
Business Overview & Strategy Operational Review Financial Review Appendix
Slide 19: Net sales up by 20% in 9M12
Net sales up by 20% in 9M12 Turkey Net Sales International Net Sales Consolidated Net Sales (TL in millions) (US$ in millions) (TL in millions) 3,287.5 2,026.5 2,221.8 597.4 2,738.0 455.3 9M11 9M12 9M11 9M12 9M11 9M12 Consolidated up by 16.3% to TL 1,376.5 million 3Q12 Turkey up by 9.8% to TL 927.7
Slide 20: EBITDA up by 42% in 9M12
EBITDA up by 42% in 9M12 Turkey Turkey EBITDA EBITDA International EBITDA Consolidated EBITDA (TL in millions) 17.9% (US$ in millions) (TL in millions) 15.6% * 20.3% * 18.6% 15.7% * 15.5% 610.5 121.3 398.8 315.1 428.5 70.6 9M11 9M12 9M11 9M12 9M11 9M12 Consolidated up by 39.2% to TL 285.0 million 3Q
Slide 21: Financial Expenses
Financial Expenses 9M11 9M12 Interest income 26.2 21.7 Interest expense (-) (43.5) (40.9) Foreign exchange gain / (loss) 20.0 (24.3) Unrealized FX gain / (loss) - Borrowings (128.2) 58.1 Gain / (loss) on derivative transactions (0.1) 0.0 Financial Income / (Expense) Net (125.9) 14.6 *mn TL 21
Slide 22: Debt Structure
Debt Structure 9M12 FY11 Change% USD denominated* 823 773 6% EURO denominated* 50 43 18% TL denominated 0 0 n.m. Other (in USD terms) 33 36 (11%) Total Financial Debt in TL 1,645 1,634 1% Total Cash & Equivalent in TL 625 526 19% Net Debt in TL 1,019 1,108 (8%) Net Debt in US$ 571 587 (3%) Maturity
Slide 23: Appendix
Appendix Financial Statements 2011 Financial Leverage 2011 Corporate Structure Country Data Operational Efficiencies Turkey AFB Market Tea Market Segments in Turkey Trade Structure in Turkey
Slide 24: Introduction to Financial Statements
Introduction to Financial Statements Basis of Preparation Consolidated / TL/$ TL/$ International Turkey Year-End Average Functional TL USD December 31, December 31, Currency 2011 1.8889 2011 1.6708 Reporting December 31, December 31, TL USD Currency 2010 1.5460 2010 1.4990 Presentation ∆ 22.2% ∆ 11.
Slide 25: Income Statement - Consolidated
Income Statement - Consolidated (TL mn) 2010 2011 2011 vs 2010 Volume (m/uc) 665.4 761.7 14.5% Net Sales 2,753.2 3,408.6 23.8% COGS (1,721.6) (2,145.8) 24.6% Gross Profit 1,031.5 1,262.8 22,.% OPEX (750.1) (939.8) 25.3% Other Inc/Exp (Net) (9.6) 5.4 n.m EBIT 271.8 328.3 20.8% EBIT (exc. other) 281.4
Slide 26: Income Statement - Turkey
Income Statement - Turkey (TL mn) 2010 2011 2011 vs 2010 Volume (m/uc) 494.4 546.8 10.6% Net Sales 2,121.4 2,472.8 16.6% COGS (1,277.5) (1,476.1) 15.5% Gross Profit 843.9 996.7 18.1% OPEX (609.7) (752.2) 23.4% Other Inc/Exp (Net) 6.1 23.5 n.m EBIT 240.3 267.9 11.5% EBIT (exc. other) 234.1 244.4 4.4%
Slide 27: Income Statement - International
Income Statement - International (USD mn) 2010 2011 2011 vs 2010 Volume (m/uc) 171.0 215.0 25.7% Net Sales 422.8 576.2 36.3% COGS (298.1) (417.1) 39.9% Gross Profit 124.8 159.2 27.6% OPEX (95.9) (115.4) 20.4% Other Inc/Exp (Net) (0.3) 1.6 n.m EBIT 28.6 45.4 58.5% EBIT (exc. other) 28.9 43.8 51.4% In
Slide 28: Balance Sheet – FY11/FY10
Balance Sheet – FY11/FY10 December December 31, December December 31, 2010 (TL million) 31, 2011 2011 31, 2010 (TL million) (audited) (audited) (audited) (audited) Cash & Cash Equivalents 522.2 491.7 ST Borrowings 125.4 627.7 Investments in Securities 3.8 107.1 Trade Payables 185.9 99.3 Trade Receiv
Slide 29: Free Cash Flow
Free Cash Flow (TL mn) 2011 2010 Cash Flow From Operating Activities Net Income Adj for Non-Cash Items 533.5 459.2 Interest Paid (51.8) (48.1) Interest Received 31.4 38.5 Taxes Paid (30.0) (60.3) Employee Termination Benefits, (33.8) (22.1) Vacation Pay, Mngmt Bonus Operating Cash Flow 449.2 367.2 2
Slide 30: Financial Leverage and FCF
Financial Leverage and FCF Net Debt/EBITDA Capex/Net Sales FCF (Including – acquisitions) (TL million) 2.3 13.9% 13.2% 1.5 214 9M11 9M12 9M11 9M12 9M11 9M12 -336 * 12M Trailing 30
Slide 31: Corporate Structure
Corporate Structure Coca-Cola icecek A.S. 100.00% Tonus Joint Stock Company, CCI International Holland B.V. 18% —> v Coca-Cola Satis ve Dagitim 944 Kazakhstan AS., Turkey <— 99 96% Ti _ The Netherlands Coca-Cola Almaty Bottlers —— Mahmudiye kaynak s 46.38%—> LLP, Kazakhstan — 48.17% jahmudiye Kaynak
Slide 32: Country Data
Country Data % of Per capita CCI’s market Population GDP per capita CCI’s 2011 population consumption of share in (mn) in 2011 in 2011 Volume below 30 sparkling bev. sparkling bev. (2) ($) (3) Breakdown years (2) (L) in 2011 (4) in 2011 (5) Turkey 74.3(1) 51% 10,576 45 70% 71.9% Pakistan 177.8 65% 1
Slide 33: Building a Sustainable Growth Business
Building a Sustainable Growth Business CCI Turkey CCI Ankara Plant Best Country Bottling Operation at Quality Achievement Reward at 2009 TCCC EAG President’s 2011 TCCC EAG National Quality Environment Awards Awards Water usage ratio Energy usage ratio (lt water/lt product) (MJ lt of product) 2005 20
Slide 34: Turkey AFB Market
Turkey AFB Market AFB Market (exc. milk) RTD AFB Market (exc. milk) 5.2 billion uc 1.3 billion uc Sparkling Tea Other Water 46.4% 2% 5% Ayran 2% RTD AFB Fruit 26.0% Juices&Still Drinks 12% Sparkling Powder& Beverages Concentrate 44% 0.4% Hot Coffee 2.5% Bottled Water HOD 35% 24.8% Source: Canadean,
Slide 35: Tea Market Segments in Turkey
Tea Market Segments in Turkey Volume Value * 2.7 bn uc 0.8 bn $ Teapotbag Teabag Teabag 4% 1% Teapotbag 5% 8% Loose Loose 95% 87% Source: Nielsen, 2011 Source: Nielsen, 2011 Very high levels of hot tea consumption • Has the highest share of throat after tap water • 95% of Turkish people drink tea ev
Slide 36: Trade Structure in Turkey
Trade Structure in Turkey Retail Volume by Channel (2011) Other 6% Gas Station 2% Hypermarket 2% Discount Store 5% On Premise Traditional 16% Grocery 47% Supermarket 23% Half of volume delivered by traditional trade channels Highest retail coverage among all FMCG categories in Turkey *Other includes
Slide 37: Glossary and Investor Relations Contact
Glossary AFB: Alcohol Free Beverages CAGR: Compound Annual Growth Rate CMB: Capital Markets Board of Turkey HOD: Home and Office delivery water OWB: One Way Bottle RTD: Ready-to-Drink Beverages UC: Unit Case (1 uc equals 5.678 liters) YTD: Year to Date Credit Rating Foreign Currency Senior Unsecured
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