Tata Consumer Products Limited · NSE:TATACONSUM
Tata Consumer Products — Tata Global Beverages — Kotak India Investment Forum 2017
49 slides from Tata Consumer Products's conference presentation, Nov 17, 2017
Slide 1: Cover letter to stock exchanges
November 17, 2017 The Secretary National Stock Exchange of India Ltd. Exchange Plaza, 5th floor Plot No. C/1, G Block Bandra Kurla Complex Bandra (E) Mumbai 400 051 Scrip Code - TATAGLOBAL Dear Sir, TATA BSE Ltd. Corporate Relationship Dept. 1st Floor, New Trading Wing Rotunda Building, PJ Towers Da
Slide 2: Investor Presentation November 2017
Investor Presentation November 2017
Slide 3: Disclaimer
Disclaimer Certain statements made in this presentation relating to the Company’s objectives, projections, outlook, expectations, estimates, among others may constitute ‘forward-looking statements’ within the meaning of applicable laws and regulations. Actual results may differ from such expectation
Slide 4: Agenda
Agenda 1. COMPANY PROFILE 2. OUR BRANDS AND INNOVATION 3. EXTERNAL ENVIORONMENT AND STRATEGIC PRIORITIES 4. OUR REGIONAL PROFILE 5. FINANCIAL OVERVIEW 3
Slide 5: Company Profile
Company Profile
Slide 6: A snapshot of Tata Global Beverages
A snapshot of Tata Global Beverages 01 02 03 04 05 06 07 Focused on Tata heritage 2nd largest tea company in 330 million + servings of $1.4 BN* in Over 3000 Three natural with global brand the world with growing our brands consumed revenues employees marketing beverages- ownership and interests in o
Slide 7: Transitions, leadership changes and movements in the organisation
The organisation has gone through a lot of transitions, leadership changes and EO movements Pakistan China Restruc- Instant ture tea exit. Russia Restructuring completed Tata Coffee to set up 5000MT FDC plant in Vietnam Himalayan water to enter US Agreement renewed with new terms with Keurig 6
Slide 8: Our Presence
Our Presence While we have leadership position in India (#1) , UK (#2) and Canada (#1), we have significant room to grow Current presence 7
Slide 9: Business Profile
Business Profile Approx. 87% of our sales comes through our Branded Business whilst 13% of our sales is through Non Branded Business 8
Slide 10: Our Brands and Innovation
Our Brands and Innovation 9
Slide 11: Continuous Investment behind our Power Brands
Continuous Investment behind our Power Brands Sr. Management focus 10
Slide 12: Branded Turnover Profile
Branded Turnover Profile Branded Turnover - 2017 Others Brands: Good Earth (USA), Vitax (Poland), Jemca (Czech Republic), Teapigs, Water Business (India), MAP (Australia) and other Branded Sales 11
Slide 13: Product Innovations
Rich track record of innovations Product Innovations Tetley Indulgence Tata Coffee - UK Matcha Tea Maharashtra Grand - Super (Teapigs) Coffee Infusions - Gold Mixture Innovative Black US 2005 2016 2017 Pyramid Tea Tata Acti Green - Super Greens / Tata Tea Tetley RTD Bags - Temples Super Fruits- demo
Slide 14: Some of our recent innovations – new products launched
Some of our recent innovations – new products launched Tetley Ayurveda Balance Tata Tea Teaveda Tetley RTD Eight O’ Clock Infusions (Canada) (India) (Canada) (USA) Tetley Super Greens Tetley Super Green Tea Tetley Indulgence Range Tata Tea Elaichi Himalayan Orchard Pure (UK) (India) (UK) (India) and
Slide 15: Our Brands : Tetley
Our Brands : Tetley One of the larger tea brands, globally Significant presence in other markets Enjoyed in over 40 countries worldwide Strong innovation agenda in tea - Super Green, Super Fruit, Super Everyday Black, Herbal, Estate Blends, Black and Green 175 years of British heritage Various award
Slide 16: Our Brands : Tata Tea
Our Brands : Tata Tea Tata Tea is rated as the second most trusted hot beverage brand in India and accorded ‘Super Brand’ status Promotes social awakening and action through its landmark Jaago Re platform. Version 2.0 launched recently. Tata Tea is the largest brand by volume and value in India Flag
Slide 17: Our Brands : Himalayan / Teapigs
Our Brands : Himalayan / Teapigs HIMALAYAN TEAPIGS Himalayan is a premium, lifestyle, mineral water brand in Launched in UK in 2006 India’s top metropolitan markets Positioned as a super premium tea brand Sourced from underground aquifer located in the Himalayas Originally set up as an incubated bus
Slide 18: Our Brands: Eight O'Clock / Good Earth
Our Brands: Eight O’Clock / Good Earth EIGHT O’CLOCK COFFEE (EOC) GOOD EARTH EOC is a value gourmet coffee brand with national distribution in the Distinctive and meaningful brand name US; limited distribution in Canada Stands for goodness and exceptional flavor Rich heritage (since 1859); recognize
Slide 19: Our Brands: MAP/Tata Gluco Plus
Our Brands: MAP/Tata Gluco Plus MAP TATA GLUCO PLUS Acquired Earth Rules Pty Ltd in 2014, the owners of MAP brand of Tasty hydration on the go – Variety of flavors to provide instant coffee energy and refreshment to consumers Expansion of portfolio in Australia in a high growth contemporary Contains
Slide 20: External Environment and Strategic Priorities
External Environment and Strategic Priorities
Slide 21: Environment, Implications and Strategic pillars
Environment, Implications and Strategic pillars External Environment Implications TGBL Strategic Priorities • Mainstream black category Focus on emerging trends – volumes declining in key Shift in market developed markets Health & Wellness, Base business trends Premiumisation, Convenience • Premium
Slide 22: Aggressive focus on Strategic Priorities
Aggressive focus on Strategic Priorities Strategic Base Business Rejuvenation/ Drive Innovations Priority Focus on Profitable Growth in core Innovative product / delivery business Opportunities Initiatives Focus on Power Brands Jaago Re Version 2 campaign – Tata Tea Build Core Brands Tetley Supers f
Slide 23: Aggressive focus on Strategic Priorities
Aggressive focus on Strategic Priorities Strategic Invest for Growth Priority Opportunities Initiatives NOURISHCO: STARBUCKS: MIDDLE EAST: Focus on incubatory business to Launch of variants for Tata Focus on store Consolidating entry drive future growth Gluco Plus which has been the expansion – 100
Slide 24: Aggressive focus on Strategic Priorities
Aggressive focus on Strategic Priorities Strategic Operational effectiveness Priority Opportunities Initiatives Cost Opportunities Exit from loss making geographies (eg Russia/China) Reinforce organizational Restructure/reassess stressed markets (eg Poland) capabilities Drive operational improvement
Slide 25: Our Regional Structure – Managing the Business
Our Regional Structure – Managing the Business
Slide 26: Global organisation structure - a network organisation
Growth Theme: Capability Building “Global” organisation structure - a network organisation to be faster and more agile Leveraging a networked organization within a hierarchical structure Executive Office ● Strategy formulation ● Resource allocation ● Direction for Execution SA EMEA CAA Others* Globa
Slide 27: South Asia
South Asia BUSINESS PROFILE KEY FACTS AND MARKET STRUCTURE • Contributes to approximately 40%+ of the total TGB Revenue. • Significant market predominantly dominated by Black Tea. • Mainly India, with smaller exposure in neighboring countries • Small market in Green Tea and Tea Bags. • Volume and Va
Slide 28: Jaago Re 2.0, Phase 2
Jaago Re 2.0, Phase 2: Target to Inspire & Create 1 mn Pre-activist https://www.youtube.com/watch?v=3I8iNkB16N0 Phase II aims to inspire people to be a part of change and pre-act on two issues: WOMEN SPORTS SAFETY ENCOURAGEMENT • Petition: To the HRD Ministry to make Gender Sensitization compulsory
Slide 29: EMEA – Europe, Middle East and Africa
EMEA – Europe, Middle East and Africa BUSINESS PROFILE KEY FACTS AND MARKET STRUCTURE • Contributes to approximately 23 % of the total TGB Revenue. • Across Europe - Everyday Black tea category de-growing whilst there is growth in other categories • Main Markets such as Green / Fruit and herbal • UK
Slide 30: CAA – Canada, America and Australia
CAA – Canada, America and Australia KEY FACTS AND MARKET STRUCTURE BUSINESS PROFILE • US coffee Market size is significantly large with “Single Serve” category being 1.7 x the bags • Contributes to approximately 23 % of the total TGB Revenue. category. Tea market is approx 10% of the total coffee ma
Slide 31: Incubatory Business in India
Incubatory Business in India BUSINESS PROFILE RECENT UPDATES • 50:50 JV company formed between Tata Global • In the year 2016-17, the Company registered a topline Beverages and Pepsico growth of 29% over the previous year. • Marketing and distribution of products in the area of non-carbonated ready-
Slide 32: Himalayan Water to enter US
Himalayan Water to enter US BUSINESS PROFILE • Tata Global Beverages’ (TGB) premium natural mineral water brand ‘Himalayan’, will now enter the USA market • Agreement signed by its subsidiary with Talking Rain Beverage Company to distribute and market the brand. • This agreement will give Himalayan
Slide 33: Incubatory Business in India – Tata Starbucks
Incubatory Business in India – Tata Starbucks BUSINESS PROFILE RECENT UPDATES • 50:50 JV company formed between Tata Global • In the year 2016-17, the Company registered a Beverages and Starbucks Coffee International topline growth of 14% over the previous year. Inc which owns and operates Starbucks
Slide 34: Non Branded Operations – Tata Coffee Limited
Non Branded Operations – Tata Coffee Limited BUSINESS UPDATE RECENT UPDATES • TGB has 57.48% stake in Tata Coffee Limited (TCL) which primarily is into • Spectacular performance in 2017, recording highest ever plantation and coffee extraction business - Operating Income, and • Plantation business -
Slide 35: Non Branded Operations – Other Businesses
Non Branded Operations – Other Businesses 34
Slide 36: Sustainability initiatives
Sustainability initiatives Sustainable products are good for people, good for the planet and also good for business SOURCING IT RIGHT PROTECTING THE ENVIRONMENT Project Sustainable Plant Protection Formulation (S-PPF) Specific Project with ETP and Tea Research Association IMPROVING LIVES BREAKING BA
Slide 37: Awards and Achievements
Awards and Achievements Over 50 accolades for the Power of 49 campaign Eight O’Clock Coffee wins Tetley Super Green Tea awarded two Reggies UK Product of the Year 2016 Tetley in UK wins five Great TGB wins at the Effie Website of the Year Award Tata Coffee wins two awards at the Taste Awards! Awards
Slide 38: Awards and Achievements … Contd.
Awards and Achievements … Contd. Tetley in UK sweeps up more TGB achieves full Rainforest Alliance Great Taste awards for the third consecutive year receiving a certification for EMEA and CAA region one-star endorsement, rated as ‘Simply Delicious’ TGB recognised as one of the most transparent compa
Slide 39: Financial Overview
Financial Overview
Slide 40: Key Insights
Key Insights Q 2 P E R F O R M A N C E U P D AT E LAUNCHES IN THE Sixth consecutive quarter of operating profit growth PERIOD Tetley Indulgence in UK Good performance continues in Q2 Eight o clock ‘Pumpkin Spice” o Operating income higher by 6% in underlying Tetley RTD in Canada currency Fruski (Tea
Slide 41: Performance for YTD 2016-17 - IndAS
Performance for YTD 2016-17- IndAS INR Crores Year Ended March Particulars 2017 2016 Total Operating Income 6780 6637 EBIT 665 538 Profit Before Exceptional Items 657 503 Exceptional Items 5 (333)* Profit before Tax 662 170 Profit after Tax 464 (30) Group Consolidated Profit 455 (37) EPS (Rs.) 6.17
Slide 42: Segment Performance - 2016-17
Segment Performance - 2016-17 Particulars Segment Revenue Segment Results Capital Employed (In Rs Crores) Mar 17 Mar 16 Mar 17 Mar 16 Mar 17 Mar 16 Branded Business Tea 4804 4715 578 579 3350 3606 Coffee 1118 1119 179 129 1584 1678 Others 36 29 (22) (28) 4 20 Total Branded Business 5958 5863 735 680
Slide 43: Strong Balance Sheet - IndAS
Strong Balance Sheet - IndAS Particulars (INR Crores) March 2017 March 2016 SOURCES OF FUNDS Shareholder’s Funds 7185 7109 Borrowings 799 1294 Non Operating Liabilities (net) 315 390 TOTAL 8299 8793 APPLICATION OF FUNDS Fixed Assets: Goodwill 3498 3710 Other Fixed Assets 1162 1062 Investments 1285 1
Slide 44: Performance for Q2 and YTD 2017-18 vs 2016-17
Performance for Q2 and YTD 2017-18 vs 2016-17 Quarter Ended Half year Ended Sep INR Crs Sep 2017 2016 Particulars 2017 2016 1692 1622 Total Operating Income 3397 3357 184 158 EBIT 400 360 208 170 Profit Before Exceptional Items 427 371 (12) - Exceptional Items (7) (1) 196 170 Profit before Tax 420 3
Slide 45: Segment Performance – H1 2017-18
Segment Performance – H1 2017-18 Particulars Segment Revenue Segment Results Capital Employed (In Rs Crores) Sep 17 Sep 16 Sep 17 Sep 16 Sep 17 Sep 16 Branded Business Tea 2454 2381 349 321 3641 3308 Coffee 540 557 91 99 1613 1693 Others 18 14 (5) (8) 27 16 Total Branded Business 3012 2953 435 412 5
Slide 46: Share Performance & Market Capitalisation
Share Performance & Market Capitalisation 15,566 Price as on 14th Touched a high of Rs Nov 2017 14,323 248 on 14th Nov 2017 246.65 12,988 12,496 226.95 205.80 10,700 198.00 9,501 9,662 9,508 9,429 169.55 150.65 150.55 153.10 149.40 Mar-17 Apr-17 May-17 Jun-17 Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Mar-1
Slide 47: Increase in Dividend Payout over time
Increase in Dividend Payout over time Dividend declared 225%, same as PY 46
Slide 48: Company information
Company information Website: tataglobalbeverages.com Equity Share details Bombay Stock Exchange (BSE) – 500800 National Stock Exchange (NSE) – TATAGLOBAL ISIN No – INE192A01025 (International Securities Identification Number) Depository Receipt Luxembourg Stock Exchanges - US8765692038 London Stock
Slide 49: Thank you
Thank you TATA GLOBAL BEVERAGES ems CY indian FEY
Tata Global Beverages — Kotak India Investment Forum 2017 on 6ix