British American Tobacco Malaysia Bhd. · MYX:BAT
British American Tobacco Malaysia Bhd — Q2 2012 Earnings Presentation
25 slides from British American Tobacco Malaysia Bhd's earnings presentation, Jul 19, 2012
Slide 1: Analyst Briefing Quarter 2, 2012
ANALYST BRIEFING QUARTER 2, 2012 19 July 2012
Slide 2: Agenda
Agenda Industry Review, Market Share and Volumes BATM Review Financial Highlights Other Highlights Future Prospects
Slide 3: Industry Review, Market Share, Volumes and BATM Review
INDUSTRY REVIEW, MARKET SHARE, VOLUMES AND BATM REVIEW
Slide 4: Industry Volumes
Industry Volumes Source: Confederation of Malaysian Tobacco Manufacturers (CMTM) Note: Sub-VFM volumes extrapolated from Retail Audit Industry Volumes (bns) Big3 + Sub VFM 3% 4.0 3.5 3.6 3.6 3.5 2% 3.1 Q1 Q2 Q3 Q4 2011 2012 Volume Variance % Variance Volume Variance % Variance Q2 2011 Q2 2012 Q2 201
Slide 5: Market remains Premium skewed
Market remains Premium skewed Source: Jun2012 Malaysia Retail Audit (Base: White Only) 80.0 74.3 70.4 YTD 2011 70.0 YTD 2012 60.0 50.0 SOM 40.0 30.0 22.1 21.3 20.0 10.0 7.5 4.4 0.0 Premium VFM Sub VFM BAT YTD 2012 BAT YTD 2011 Share of Premium 72.0 Share of Premium 72.0 Share of Value for Money 41.3
Slide 6: Illicit Trade
Illicit Trade Source: Illicit Cigarette Study, 2008 - 2012 -2.6ppt 37.5 37.3 36.3 36.1 36.3 34.8 40 -1.2ppt -1.0ppt 34.7 -0.2ppt -1.5ppt -0.1ppt 35 25.7 30 +11.8ppt 20.7 23.9 25 21.9 22.7 23.2 21.1 % Illicit 22.5 20 13.4 15 16.7 10 14.4 13.7 13.4 13.4 13.1 12.2 11.9 5 2008 2009 2010 2011 2011 Wave 1
Slide 7: BAT Share of Market
BAT Share of Market Source: Jun2012 Malaysia Retail Audit (Base: White Only) % 2012: 62.3% (YTD June) 2011: 61.0 (Full Year) 63.0 62.3 62.8 62.0 62.0 62.4 61.8 61.8 62.1 62.2 61.6 61.5 62.0 62.1 61.3 60.9 61.0 60.5 60.0 60.1 2011: 60.1% (YTD June) 59.0 59.0 58.7 2012 2011 58.0 Jan Feb Mar Apr May Ju
Slide 8: BAT & GDB Share
BAT & GDB Share Source: Jun2012 Malaysia Retail Audit (Base: White Only) BATM +1.3ppt Source: Malaysia Retail Audit (Base: Total Whites, YTD JUN12) Strong GDB performance, predominantly Dunhill. BAT YTD June 2012 SOM is 62.3%, up +1.3ppt vs. FY 2011
Slide 9: Dunhill
J&J - Oil 3 Period Ended JUN12 | Hide NA's | Colour % Chg | Share of White Dunhill Source: Jun2012 Malaysia Retail Audit (Base: White Only) +2.1ppt April 2012 Dunhill SWITCH New and improved pack April 2012 Year-long equity building campaign Dunhill continue to stretch its leadership, with record br
Slide 10: DH Switch: 0.6% SOM nationally post 3rd month of re-launch
DH Switch: 0.6% SOM nationally post 3nd month of re-launch. Source: Jun2012 Malaysia Retail Audit (Base: White Only) 1.2 1.0 0.61 0.42 1.0 0.30 0.5 0.15 0.15 0.15 0.15 0.8 0.8 0.0 0.7 0.7 0.6 0.6 0.6 -0.5 0.5 0.5 0.4 -1.0 0.3 0.3 0.3 0.3 0.2 0.2 0.1 0.1 0.2 0.2 0.2 -1.5 0.1 0.1 0.1 0.1 0.0 -2.0 2011
Slide 11: BAT VFM segment share
BAT Period Ended JUN12 | Hide NA's | Colour % Chg | Share of Vfm BAT VFM segment share Source: Jun2012 Malaysia Retail Audit (Base: White Only) -1.3ppt Decline in 2012 mainly attributed to Pall Mall’s softening performance. Growth in 2011 vs. 2010 driven by launch of Peter Stuyvesant.
Slide 12: Pall Mall
J&J - Oil 3 Pall Mall Period Ended JUN12 | Hide NA's | Colour % Chg | Share of White Source: Jun2012 Malaysia Retail Audit (Base: White Only) Pall Mall Family of SKUs -0.4ppt Feb 2012: Launch of Pall Mall Mint Jul 2012: Pall Mall Pack Upgrade Pall Mall’s pack upgrade in July 2012 expected to strengt
Slide 13: Pall Mall Mint stabilized at 0.3% SOM
Pall Mall Mint J&J - Oil 3 Period Ended JUN12 | Hide NA's | Colour % Chg | Share of White Source: Jun2012 Malaysia Retail Audit (Base: White Only) Pall Mall Menthol : Share of Market (%) - Malaysia Pall Mall Menthol Range Pall Mall Mint stabilized at 0.3% SOM, post 5 months of launch. This SKU has a
Slide 14: Peter Stuyvesant
J&J - Oil 3 Peter Stuyvesant Period Ended JUN12 | Hide NA's | Colour % Chg | Share of White Source: Jun2012 Malaysia Retail Audit (Base: White Only) -0.1ppt Peter Stuyvesant Family of SKUs Peter Stuyvesant declined marginally, 3.2% SOM YTD June 2012 urce: Retail Index (Malaysia) Produk ini mengandun
Slide 15: Financial Highlights
FINANCIAL HIGHLIGHTS
Slide 16: Productivity Savings
Productivity Savings 60 51.3 50 44.8 2.8 41.5 39.8 1.6 8.6 38.6 40 6.7 4.5 2.7 3.3 30.5 RM million 3.9 8.2 30 12.9 23.4 13.0 16.5 3.4 20 39.9 9.0 36.5 32.6 1.5 28.8 4.4 16.6 23.0 7.8 10 5.0 3.4 11.6 3.4 2.1 5.3 0 1.9 2005 2006 2007 2008 2009 2010 2011 1H, 2012 FY 2012 Supply Chain Indirects Overhead
Slide 17: Quarter 2, 2012 vs Quarter 2, 2011
Quarter 2, 2012 vs Quarter 2, 2011 Volumes Revenue Net Turnover RM 'm ns M n Stk s RM 'm ns - 1.2% + 6.1% 2, 500 1, 100 + 2.4% 550 542 2,195 1,068 530 2,169 1,043 511 1, 050 510 2, 000 490 1, 000 1, 500 470 95 0 450 1, 000 430 90 0 410 50 0 390 85 0 370 - 80 0 350 Q2 2011 Q2 2012 Q2 2011 Q2 2012 Q2
Slide 18: YTD 2012 vs YTD 2011
YTD 2012 vs YTD 2011 Volumes Revenue Net Turnover RM'm ns RM'm ns Mn Stk s +1.6% +3.7% +5.9% 2, 200 1,100 5, 000 2,111 1,055 4, 500 4,276 4,343 1,050 2,035 4, 000 2, 000 996 1,000 3, 500 950 3, 000 1, 800 2, 500 900 2, 000 1, 600 850 1, 500 800 1, 000 1, 400 750 500 - 1, 200 700 YTD 2011 YTD 2012 YT
Slide 19: Q2 Dividends
Q2 Dividends 2011: 98% Payout (110% inc. Special) 0.30 0.66 0.65 0.65 0.60 0.60 0.60 Q1 2011 Q2 2011 Q3 2011 Q4 2011 Q1 2012 Q2 2012 Dividends for Q2 2012 at 65 cents per share
Slide 20: Other Highlights
OTHER HIGHLIGHTS
Slide 21: Recent CR Highlights
Recent CR Highlights BAT Malaysia Family Day – Big Day Out at Putrajaya Wetlands More than 1,300 employees and their family members joined in the Big Day Out which was organised as part of the 100 years celebration.
Slide 22: Recent CR Highlights (cont'd)
Recent CR Highlights (cont’d) BAT Malaysia Safety & Health Week Held from 23rd – 27th April, employees and contractors were educated on road and industrial safety through various games and information booths. Seat Belt Convincer Handphone Impairment Alcohol Impairment Safety Helmet Demo
Slide 23: Future Prospects
FUTURE PROSPECTS
Slide 24: Future Prospects
Future Prospects The unprecedented zero excise increase in 2011 coupled with robust enforcement has allowed the legal market to register marginal increase in volume. Given this environment and the weakening of the sub-VFM, BAT has continued to grow market share by 1.3ppt vs FY2011. 2012 profit
Slide 25: Thank You
Thank You BRITISH AMERICAN TOBACCO MALAYSIA
British American Tobacco (Malaysia) Berhad — Q2 2012 Earnings Presentation on 6ix