Slide 1: Profit protected despite historically high cocoa prices
Q1/2024 26 April 2024 Profit protected despite historically high cocoa prices
Slide 2: Agenda
Agenda 1 Cloetta in brief and quarterly update 2 Financials 3 Strategic update 4 Q&A
Slide 3: Leading confectionery company in Northern Europe
Leading confectionery company in Northern Europe Key figures Net sales by country, 2023 Annual net sales 2023 (SEKbn) 30% Sweden 8.3 21% 15% Finland The Netherlands 10% Denmark Candy Pick & mix Employees (on average) 6% Norway 2,600 6% 5% Germany The UK 7% International Markets Countries with sales
Slide 4: Q1: Profit protected despite historically high cocoa price
Q1: Profit protected despite historically high cocoa price Q1 Net sales 1 Operating environment still affected by food price inflation +5.7% Organic growth 2 Strong demand for our products resulted in stable volumes SEK 2.1 bn 3 Proved resilience of business and strategy 4 Adjusted profit positively
Slide 5: Agenda
Agenda 1 Cloetta in brief and quarterly update 2 Financials 3 Strategic update 4 Q&A
Slide 6: Strong demand: Fair pricing on top of stable volumes
Strong demand: Fair pricing on top of stable volumes Net sales Q1/2024 +6.1% + 5.7% +0.4% 2,094 1,973 Branded packaged: + 3.6% Pick & mix: + 11.7% Q1/23 Organic growth FX Q1/24 6
Slide 7: Strong growth in both segments vs tough LY comparator
Strong growth in both segments vs tough LY comparator Net sales in quarter 20.5% Branded packaged products 14.8% 10.2% 10.9% 11.1% 9.3% 8.2% 7.3% 6.1% 2.5% 4.0% 2.5% 3.6% 72% Q1/21 Q2/21 Q3/21 Q4/21 Q1/22 Q2/22 Q3/22 Q4/22 Q1/23 Q2/23 Q3/23 Q4/23 Q1/24 79.6% Pick & mix 28% 32.4% 32.7% 21.6% 23.8% 24
Slide 8: Profit protected despite input cost hike since LY
Profit protected despite input cost hike since LY Operating profit, adjusted • Stable volumes despite higher prices and favorable mix through portfolio optimisation 10.1% 9.2% and Net Revenue Management 200 15 -22 -1 192 • Fair pricing to offset cost hikes requires more pricing, including for cocoa
Slide 9: Easter lifts P&M to mid-term target while Branded down
Easter lifts P&M to mid-term target while Branded down Operating profit, adjusted, by segment 12.7% 10.0% 184 -32 152 Branded packaged Q1/23 var. Q1/24 3.0% 6.9% 40 Pick & mix 24 16 Q1/23 var. Q1/24 9
Slide 10: Increased investments in our core brands driver vs LY
Increased investments in our core brands driver vs LY SG&A 22.3% 21.6% +13 453 3 9 440 1 Q1/23 Items FX Net SG&A Q1/24 affecting comparability 10
Slide 11: Strategic building blocks to deliver margin expansion
Strategic building blocks to deliver margin expansion Greenfield Net facility revenue Perfect manage- Factory ment VIP+ Branded cost mix and Swedish reduction volume Pick & mix business Pick & mix at Covid-19 and cost volumes breakeven and value inflation 2022–2023 Mid- 2019 2023 term 11.4%* 9.6%* ≥
Slide 12: SEK 99m in free cash flow; SEK 122m better than LY
SEK 99m in free cash flow; SEK 122m better than LY Cash flow Q1/2024 252 • High free cash flow driven -103 by stronger operating result and less -50 99 77 investments in working capital -22 • Better working capital driven by Cash flow Changes in Investments Free cash Other Cash flow Cash flow before
Slide 13: Strong financial position: All-time low Net debt/EBITDA
Strong financial position: All-time low Net debt/EBITDA Financial position • Net debt/EBITDA at all-time low 1.6x and well below our targeted 2.5x • Net debt decrease driven by generated cash and despite unfavourable revaluation impact • Unutilised access to cash of SEK 4.1bn 4.5 5,000 Access to cas
Slide 14: Agenda
Agenda 1 Cloetta in brief and quarterly update 2 Financials 3 Strategic update 4 Q&A 14
Slide 15: Our strategy
Our strategy “ Growth leadership Cloetta is a proud provider of joyful 1 in Branded moments – our brands and Lower costs packaged goods and greater products bring fun and joy to memorable occasions efficiency 3 4 We are convinced that our consumer focus is the Sustainability basis for us to grow and
Slide 16: Growth leadership in Branded packaged goods
1 Growth leadership in Branded packaged goods Responding to growing consumer trend demanding local brands and innovative offerings As Branded 1 Profitable growth and improved product mix, continued recovery of mix packaged products have an 2 Market share growth in core markets by focus and support o
Slide 17: 1.1 Continue to recover the mix
1 1.1 Continue to recover the mix Läkerol Strawberry launch to reach younger consumer group Sales Volume All pack formats 120 000 100 000 80 000 60 000 v.08 v.09 v.10 v.11 v.12 v.13 v.14 v.15 v.16 Classic Tot Strawberry Tot 17
Slide 18: 1.5 Growing through innovation & valorisation
1 1.5 Growing through innovation & valorisation Launch of Red Band Juicy & Sour Bites in the Netherlands Winning the Distrifood Wheel Of Retail-award for best product innovation 18
Slide 19: 1.6 Growing E-Commerce
1 1.6 Growing E-Commerce The Jelly Bean Planet launch at Amazon US NSV € $200 000 Easter ‘24 $180 000 $160 000 $140 000 $120 000 $100 000 $80 000 Easter ‘23 $60 000 $40 000 $20 000 $- Jan Jan May Mar Jul Mar Jun Oct Nov Aug Apr Dec Feb Sep Feb Source: Amazon Data 2023-2024
Slide 20: Sustainable value from the Pick & mix business
Sustainable value from the Pick & mix business 2 Driving profitable volume growth to 5–7% EBIT including allocated costs From its strong 1 Growth of consumer trends like individualism and sustainable packaging market position Cloetta has good 2 Customers see this as in-store differentiation to attra
Slide 21: Lower Cost and Greater Efficiency
3 Lower Cost and Greater Efficiency Adding %EBIT to our result Cloetta has 1 Perfect Factory: increasing efficiency and reducing waste and energy in our plants programs to optimize all lines 2 Greenfield project of the P&L by lowering cost and 3 ZBB methodology to reduce indirects NRM spending with
Slide 22: Update on greenfield project
3 4 Update on greenfield project Secure and improve on adjusted EBIT margin of at least 14 per cent • When operational, creates capacity for growth, significantly reduces cost and reduces greenhouse gas emissions • EBIT contribution remains higher up in the range SEK 220–260m • Important step on jou
Slide 23: Closure of Borchwerf factory at end of Q2/2024
3 4 Closure of Borchwerf factory at end of Q2/2024 First of the three factories to be closed, ahead of original plan • First production transferred to 3P suppliers during Q1/2024 • Successful soft bites assortment will be insourced in Sneek • Agreement with labour union on closure • Agreement with f
Slide 24: Our sustainability agenda
4 Our sustainability agenda Sustainability targets and ambitions For You • Offer sugar-free, less sugar and options with functional ingredients • Offer more vegan options • Supporting dental health with our xylitol products Cloetta’s sustainability agenda focuses on • Continue to work towards zero w
Slide 25: Q&A
Q&A 25
Slide 26: Thank you!
Thank you!
Slide 27: Appendix
Appendix 27
Slide 28: Greenfield facility – Pro forma profit and loss Q1
Greenfield facility – Pro forma profit and loss Q1 Q1/2024 Q1/2024 Q1/2024 Other items Pro-forma Greenfield affecting Reported excl. Adjusted comparability greenfield Net sales 2,094 2,094 2,094 Cost of goods sold -1,448 4 -1,452 -1,452 Gross profit 646 4 642 - 642 Selling expenses -267 -267 -267 Ge
Slide 29: Important information
Important information • This presentation has been prepared by Cloetta AB (publ) (the “Company”) solely for use at this presentation and is furnished to you solely for your information and may not be reproduced or redistributed, in whole or in part, to any other person. The presentation does not con