Anheuser-Busch InBev SA/NV · EURONEXT:ABI
Anheuser-Busch InBev SA/NV — SABMiller — Consumer Analyst Group of Europe 2014
51 slides from Anheuser-Busch InBev SA/NV's conference presentation, Mar 17, 2014
Slide 1: SABMiller plc – Consumer Analyst Group of Europe
SABMiller plc Consumer Analyst Group of Europe Alan Clark Gary Leibowitz Chief Executive SVP Investor Relations 17 March 2014
Slide 2: Forward looking statements
Forward looking statements This presentation includes „forward-looking statements‟ with respect to certain of SABMiller plc‟s plans, current goals and expectations relating to its future financial condition, performance and results. These statements contain the words “anticipate”, “believe”, “intend
Slide 3: SABMiller – a balanced global beer business
SABMiller – a balanced global beer business World‟s 2nd largest brewer, with superior long-term revenue and profit growth #1 or 2 position in > 90% of markets Leading brand portfolios and in-market engagement, driven by deep local insights Building and broadening the beer category and its po
Slide 4: Alan Clark – career background
Alan Clark – career background 2013 Chief Executive, SABMiller plc 2012 Chief Operating Officer, SABMiller plc 2003 Managing Director, SABMiller Europe 2001 Managing Director, Amalgamated Beverage Industries 2000 Marketing Director, SAB Ltd 1996 Operations Director, Northern Regions, SAB Ltd 1994 Ge
Slide 5: A decade of sustained growth
A decade of sustained growth F04 index = 100 F04-F13 CAGR 340 Organic Lager Volume 300 13.3% Group Revenue EBITA 260 EPS adjusted 9.7% 220 7.4% 180 140 3.7% 100 F'04 F'05 F'06 F'07 F'08 F' 09 F'10 F' 11 F' 12 F'13 Source: SABMiller results F04 = 100, grow th – organic constant currency 5
Slide 6: Four consistent strategic priorities
Four consistent strategic priorities Constantly raising the profitability of local businesses, sustainably Creating a balanced and attractive global spread of businesses Developing strong, relevant brand portfolios that win in Leveraging our skills the local market and global scale 6
Slide 7: A historically decentralised approach
A historically decentralised approach Decentralised industry dynamics, brand portfolios, operations, and local accountability, bound by: Common culture Global performance and talent management SABMiller Ways to drive growth and efficiency Singular approach to business/M&A turnarounds 7
Slide 8: Beer has always been passionately local…
Beer has always been passionately local… 8
Slide 9: Who produces the best beer in the world?
Who produces the best beer in the world? Netherlands 42% El Salvador 39% Mozambique 42% Belgium 31% Germany 34% Germany 11% Germany 17% USA 8% Italy 7% Emotional engagement is nurtured locally Czech 92% Poland 56% Germany 51% Germany 3% Czech 14% Italy 12% Belgium 1% Germany 12% Ireland 7% Source: I
Slide 10: Replicable successes across markets
Replicable successes across markets Past and present 10
Slide 11: Brand renovation, building national icons
REPLICABLE SUCCESSES Brand renovation, building national icons 11
Slide 12: Brand portfolio construction
REPLICABLE SUCCESSES Brand portfolio construction Business objectives Specific Goals to achieve objectives EGO / ME Where to play Example: Style Colombia Beer Making it Opportunity appreciation assessment compass and 1 positioning territories How to win strategy Brand Brand & Portfolio positioning c
Slide 13: Sales and channel execution improvement
REPLICABLE SUCCESSES Sales and channel execution improvement US: Total Cross Channel Partnership Performance, based on choice of category captain Across marketplaces, +1.9 +4.2 pts from sophisticated to rudimentary MillerCoors Competitor (2.3) BRAND SERVICE TRADING CONSUMER R2M VISIBILITY PROMOS & P
Slide 14: Improved market penetration
REPLICABLE SUCCESSES Improved market penetration Africa: increasing outlet penetration Colombia: service model evolution % outlets served 18% Rural complementary Van sales 11% Rural pre-sales 10% 9% Urban complementary Urban pre-sales F10 F11 F12 F13 F07 F11 F13 Future 14
Slide 15: Revenue management
REPLICABLE SUCCESSES Revenue management Clear US local market strategy Price promotion effectiveness Reallocate to stronger High promotion events Planning unit Eliminate Drive share Expected profit Excellent Good Fair Poor pool growth ROI Drive both margin/share Drive margin Low Share of promo spend
Slide 16: Stakeholder relations
REPLICABLE SUCCESSES Stakeholder relations Excise – Engaging with governments to avoid unfavourable rate or formula changes – Engagement enabled lower excise for cassava and sorghum-based beer in parts of Africa Led industry/government collaboration on illegal alcohol in Peru 16
Slide 17: Growth opportunities ahead
Growth opportunities ahead 17
Slide 18: Beer: the natural and moderate choice
GROWTH OPPORTUNITIES AHEAD Beer: the natural and moderate choice Beer as a… Beer as a … Beer as a… Natural Product Social Contributor Sensorial Experience Natural ingredients (cereal, Brings consumers together Rich, refreshing tastes, hops and water), no rework or colours and aromas additives
Slide 19: Beer per capita consumption
GROWTH OPPORTUNITIES AHEAD Beer per capita consumption 120.0 2012 90.0 60.0 30.0 0.0 Source: Plato Logic Global Beer Market (November 2013) 19
Slide 20: Beer's share of alcohol
GROWTH OPPORTUNITIES AHEAD Beer‟s share of alcohol Share of alcohol, indicative estimates Beer share of alcohol 100% 70% 60% 80% 50% 60% 40% 40% 30% 20% 20% 10% 0% 0% North SABM C&E China South Africa Poland Peru China* America LatAm Europe Africa F00 F13 Clear Beer Sorghum Beer Wine Spirits Estimat
Slide 21: Unit revenue
GROWTH OPPORTUNITIES AHEAD Unit revenue Beer industry volume, by segment 2013F 100% 80% 60% 40% 20% 0% W USA Australia C & E LatAm Africa Asia Europe Europe Economy Mainstream Premium Superpremium Source: Canadean forecast 2013 data. Definitions: super premium >150 index, premium 110-150, economy <9
Slide 22: Driving SABMiller's future success
Driving SABMiller’s future success 22
Slide 23: Focus on beer category growth; leveraging scale; stakeholder partnership
DRIVING SABMILLER‟S FUTURE SUCCESS Focus on beer category growth Leveraging scale Stakeholder partnership 23
Slide 24: Focus on further beer category growth
DRIVING SABMILLER‟S FUTURE SUCCESS Focus on further beer category growth Refresh core lager across markets Lead the development of Increase premium mix the beer category Accelerate global brands Innovate across a vibrant spectrum of beer styles Access more consumer needs and occasions Selective part
Slide 25: Refresh and renovate core lager
DRIVING SABMILLER‟S FUTURE SUCCESS Refresh and renovate core lager On-going importance of moving national icon brands forward Building or re-building brands over time Evolving as consumer needs change 25
Slide 26: Premiumisation
DRIVING SABMILLER‟S FUTURE SUCCESS Premiumisation Stretching the price ladder: the 110-150 price index opportunity 26
Slide 27: Premiumisation – China Snow range
DRIVING SABMILLER‟S FUTURE SUCCESS Premiumisation China: Snow range by price/channel segment Restaurants Night outlets Off trade Snow variant Price 500ml bottle 330ml bottle 330ml cans (% of franchise total) ¥65 PILOT in major metros: US$10.75 Opera Lady & Opera Gent ¥55-60 International PILOT in 3
Slide 28: Affordability
DRIVING SABMILLER‟S FUTURE SUCCESS Affordability Africa Enablers of beer price reductions Hours worked for a versus mainstream -10% -20% -30% -50% mainstream beer 5.0 4.4 2.8 2.4 2.4 1.1 1.1 0.3 0.2 Pricing Transaction Local grains Opaque RSP packs Sorghum, beers compliance, Draught, cassava, deeper
Slide 29: Innovation – Refresh the Category
DRIVING SABMILLER‟S FUTURE SUCCESS Innovation Refresh the Category Innovate to fuel growth New liquids, packs and experiences Develop the Category (within beer) Expand the Category (beyond beer)
Slide 30: Innovation
DRIVING SABMILLER‟S FUTURE SUCCESS Innovation Expand to other beer styles Growth of mainstream has driven taste harmonisation Product landscaping highlights “white spaces” Greater use of intrinsics and functional benefits to target premium occasions Beer has many variables to drive Landscape
Slide 31: Creating value with non-alcoholic drinks
DRIVING SABMILLER‟S FUTURE SUCCESS Creating value with non-alcoholic drinks Across Africa, Central America, Central Asia (CCI) – Coca Cola bottlers (subs & assoc.) in 32 markets Broader beverage scale advantages – Operations – Distribution – Outlet relationships and space F13 soft drinks EBITA m
Slide 32: Leveraging scale
DRIVING SABMILLER‟S FUTURE SUCCESS Focus on beer category growth Leveraging scale Stakeholder partnership 32
Slide 33: GBS building on the foundation of BCP
DRIVING SABMILLER‟S FUTURE SUCCESS GBS building on the foundation of BCP LATAM APAC SA Europe Africa Corporate Shared Service Lines Sales & Supply Chain Order Record to Source Hire Marketing & Operations to Cash Report to Pay to Retire Services Services Corporate ERP 33
Slide 34: End-to-end supply chain optimisation
DRIVING SABMILLER‟S FUTURE SUCCESS End-to-end supply chain optimisation Sharpen focus on the Drive functional Stimulate Consumer & excellence innovation through Customer Technical insight Demand and supply planning Sales and operations planning Innovation Suppliers Procurement Manufacturing Distribu
Slide 35: Procurement is a globally integrated function
DRIVING SABMILLER‟S FUTURE SUCCESS Procurement is a globally integrated function Expanding category focus to in-directs Spend under centralised management to increase to >80% Specialist capabilities built at global and regional level
Slide 36: Stakeholder partnership
DRIVING SABMILLER‟S FUTURE SUCCESS Focus on beer category growth Leveraging scale Stakeholder partnership 36
Slide 37: Sustainable development
DRIVING SABMILLER‟S FUTURE SUCCESS Sustainable development Multi-stakeholder partnerships to mitigate risk Water, energy and carbon Water efficiency +20% between 2008-2013 management Energy efficiency +8% per hl of lager produced in 2013 Reduced CO2 emissions by 10% in 2013 Entrepreneurial
Slide 38: The role of alcohol and beer in society
DRIVING SABMILLER‟S FUTURE SUCCESS The role of alcohol and beer in society Open dialogue with regulators Focus on self regulation Industry commitment to address alcohol harm
Slide 39: Regional review
| al Regional review I 39
Slide 40: Our conviction behind developing markets remains
Our conviction behind developing markets remains Current headwinds in some markets Long term fundamentals intact FX rates rebalancing; imported inflation Balanced geographical footprint hitting consumer disposable income Underlying beer fundamentals remain Excise increases/ regulatory change
Slide 41: Latin America
Beer share of alcohol increase (bps)* Latin America Colombia Peru Continuing growth in LAE share, across Ecuador Panama new consumers and occasions Honduras Large embedded volume growth potential El Salvador – Includes sourcing from illegal alcohol -500 0 500 1000 1500 Packaging strategy drivi
Slide 42: Europe
Changing market dynamic Europe On to off shift Margin pressure due to segment, channel and package mix, competitive environment and consumer softness Industry re- Consumers orientation towards seeking value for SABMiller enhancing perceptions of beer, to economy brands money drive LAE share and
Slide 43: MillerCoors
MillerCoors Win in premium lights Expand in above premium with scale innovations – Above-premium up 3ppts to 14% of revenue in 2013 Create value through strong revenue and category management – Net rev/hl up 3.4% in 2013 Support and develop the MillerCoors distribution system for effectivene
Slide 44: Africa
Premium segment growth in Africa Africa Enormous growth potential – Beer‟s LAE share still < 20% (including informal) – Trading up from informal alcohol; rise of the middle class Broadening our portfolios, stretching price ladders – Mainstream; premium; affordability, enabled by local sourcing E
Slide 45: Asia Pacific – Australia
Asia Pacific – Australia Reinvigorate our Carlton & United Breweries (CUB) brands and commercial functions while delivering cost synergies and savings Winning portfolio Restore the core Immediate growth Future growth Innovation pipeline Channel management and route to market 45
Slide 46: Asia Pacific – China
Asia Pacific – China Further build CRSB‟s market leadership – Organic market share gains, complemented by acquisitions Increasing breadth within the Snow franchise – Across premium price segments, driving rev/hl Improving route to market, distributor influence and channel execution Short ter
Slide 47: South Africa
South Africa Further extend our clear market leadership in core lager Broader portfolio to appeal to new consumers on more occasions Capitalise on our unmatched outlet reach and channel execution Share of premium* beer 12 month moving Rigorous revenue and cost management 65% SAB Manage bee
Slide 48: Conclusion
Conclusion • SABMiller‟s consistent strategy is delivering replicable successes • We see substantial revenue and margin growth opportunities ahead • We are increasingly leveraging our global skills and scale • Refreshing and romancing core lager is at the heart of the business • Our broader portfoli
Slide 49: Q&A
Q&A 49
Slide 50: Divisional medium term guidance
Divisional medium term guidance C&E Latin South MillerCoors Africa Asia Pacific Europe America Africa Date guidance published Feb 2014 June 2013 March 2013 Feb 2012 Oct 2012 July 2013 Beer: 1-4% Volume LSD -1 to flat 4-6% HSD (GDP +50%) 5-8%** SD 2-5% NPR/hl (since 2014) Flat/ slightly LSD 2-4% 3-5%
Slide 51: Capital expenditure
Capital expenditure Investment will continue to support growth Capital expenditure will continue to reflect 8 - 10% of NPR 2% LatAm Developing market growth supported by capacity expansions 15% Europe Investment in new product and packaging capabilities 6% 36% Africa Asia Pacific 26% SAB 15% C