Emperador Inc. · PSE:EMI
Emperador — Investor Presentation (September 2021)
52 slides from Emperador's investor presentation, September 2021
Slide 1: Investor Update September 2021
Investor Update SEPTEMBER 2021
Slide 2: Disclaimer
Disclaimer You must read the following before continuing. The following applies to the information following this page, the oral presentation of such information at the meeting you are attending, the Q&A session and other materials which may be distributed at, or in connection with, the presentation
Slide 3: We are Emperador Inc.
We are Emperador Inc. A leading, high growth whisky and brandy company with a truly globally recognized portfolio of brands distributed to 100+ countries and world leading market positions A leading global spirits company HERITAGE Hundreds of years of brandy and whisky history with storied brands LE
Slide 4: From Humble Beginnings to a Global Company in Four Decades
From Humble Beginnings to a Global Company in Four Decades Our beginnings Transformative acquisitions Overseas expansion Emperador Inc. in 2025 (1979 – 2013) (2014 – 2017) (2014 – 2020) (2025 and beyond) (Oct 2014) Overseas expansion5 Global leader in spirits Founded by Dr. Andrew L Tan in 1979 Over
Slide 5: Portfolio of World Renowned Brands across Scotch Whisky and Brandy
Portfolio of World Renowned Brands across Scotch Whisky and Brandy, Ranging from Luxury to Mainstream Scotch whisky Brandy Luxury Super Premium Premium Standard Accessible Source: Company filings and information 5
Slide 6: Our Strategy — Contemporize, Premiumize, Internationalize
Our Strategy — Contemporize, Premiumize, Internationalize C CONTEMPORIZE Excite customers with Rebrand and reposition Improve brand visibility innovative new product key brands amongst millennials and our offering launches Gen Z P 2x Branded Single Malt Sales by 2025 PREMIUMIZE Leverage iconic portf
Slide 7: Consistent Quarter-on-Quarter Growth with Profitability, Despite COVID-19
Consistent Quarter-on-Quarter Growth with Profitability, Despite COVID-19 Consistent quarter on quarter sales growth despite impact of COVID-19 with all-time-high 2Q21 results 17,736 18,367 12,372 12,927 13,255 11,026 12,077 10,431 10,658 10,882 Revenue (PHPm) 1Q19 2Q19 3Q19 4Q19 1Q20 2Q20 3Q20 4Q20
Slide 8: Emperador Inc. – A Leading Global Spirits Player
Emperador Inc. – A Leading Global Spirits Player 1 A leading global spirits player with proven track record, solid momentum and established footprint in over 100 countries 2 Portfolio of heritage and well-recognized global brands coupled with remarkable innovation capabilities and insights 3 Entrenc
Slide 9: Our vision for 2025
Our vision for 2025 Emperador is proud to announce our growth aspirations for 2025 — including generating >50% of revenues and profits internationally (outside the Philippines) 1H21 Revenue Mix Performance 2025 Objectives Single malts grew at +22% CAGR Scotch from 2015 to 20201 Whisky Revenue (PHPbn
Slide 10: Whyte & Mackay
Whyte & Mackay A Global Scotch Whisky Gem
Slide 11: Whyte & Mackay – The 5th Largest Scotch Whisky Manufacturer Globally
Whyte & Mackay – The 5th Largest Scotch Whisky Manufacturer Globally1 Whyte & Mackay aspires to be the driving force in whisky, renowned for building brands that stand out A CLEAR VISION To be a driving force in whisky, renowned for building brands that stand out AN AWARD-WINNING WHISKY MAKER ▪ 175
Slide 12: A Portfolio of World Renowned Single Malt Brands
A Portfolio of World Renowned Single Malt Brands Imminent success in global markets, illustrated by rapid sales growth and market leadership #7 Single Malt Brand Globally1 LUXURY #1 Fastest Growing Single Malt Globally (2018-2020)2 SUPER PREMIUM #13 Single Malt Scotch Brand Globally3 PREMIUM #2 Fast
Slide 13: Strong Growth Profile Delivered on the Back of Fast Growing International Business
Strong Growth Profile Delivered on the Back of Fast Growing International Business Since Emperador acquired W&M in 2014, we have rapidly grown the business by expanding from a UK- centric strategy to distribute more internationally and develop a truly globally recognized portfolio of brands W&M bran
Slide 14: Solid Growth Momentum in Greater China Single Malt Scotch Market
Solid Growth Momentum in Greater China Single Malt Scotch Market Perceived as dynamic, international and sophisticated drink by urbanized and high-income consumers, Emperador’s single malt scotch whisky business has grown rapidly in China during the last 5 years W&M has significantly outperformed th
Slide 15: We Are Geared Towards International Growth And Premiumisation
We Are Geared Towards International Growth And Premiumisation ▪ Rapid growth in international markets – focus on key strategic markets globally ▪ Focus on single malt brands – high value and high margin ▪ Single malt sales now comprise c.70% of branded business 1 and are even more important in margi
Slide 16: We are now the #6 Single Malt Whisky Producer Globally
We are now the #6 Single Malt Whisky Producer Globally Whyte & Mackay has solidified its market-leading position in the global single malt market as one of the global top 10 single malt whisky producers Volume (2020) Position Retail Value (2020) Position Company A 1 Company A 2 1 Company B 2 Company
Slide 17: Our Brandy
Our Brandy Spearheading Global Brandy Growth
Slide 18: Fundador – Longstanding 300 Years of Brandy Heritage
Fundador – Longstanding 300 Years of Brandy Heritage Being Spain's oldest and largest brandy and sherry maker, Fundador is recognized for its unmatched quality Platinum Award Best Brandy in the World Best Wine of the World (2016) SFWSC (2021) IWSC (2019) Brandy range in – Harveys Amontillado VORS –
Slide 19: Our Denominación de origen – The Sherry Triangle
Our Denominación de origen – The Sherry Triangle Spanish brandies, Brandy de Jerez, are aged in sherry casks that originated from the Sherry Triangle. The product is protected by the denomination of origin, one of three regulated brandies in Europe (alongside cognac and armagnac). Fundador is one of
Slide 20: Fundador – The World’s Best Brandy
Fundador – The World’s Best Brandy The superior quality of Fundador's brandies has been recognized by connoisseurs and critics globally Fundador Supremo 18YO Oloroso Fundador Supremo 15YO Amontillado Fundador Supremo 12YO Pedro Ximénez Fundador Exclusivo Fundador Triple Madera Fundador Double Madera
Slide 21: Snapshot of Brandy Growth Across Key International Markets
Snapshot of Brandy Growth Across Key International Markets 1 Leveraging our Philippines heritage and unique understanding of the consumer to enter new markets globally Consistent strong international brandy Expansion of global footprint Differentiated and bespoke Asia-mindset growth to penetrate Gre
Slide 22: Snapshot of Brandy Growth Across Key International Markets (cont’d)
Snapshot of Brandy Growth Across Key International Markets (cont’d) 2 3 Leading market position in key markets globally Strong growth momentum propelling international across brandy and Spanish brandy brandy forward EMP 1H 2021 y-o-y brandy sales volume growth (%) Rank1 Market share1 (%) Canada #1 4
Slide 23: Three Keys to Future Success
Three Keys to Future Success Going forward, Emperador will further solidify its leadership in the global brandy market in three directions ▪ To be top-of mind with a high degree of physical To contemporize our availability products to target ▪ 360-degree approach across packaging, taste, new custome
Slide 24: Financial Overview
Financial Overview . 3 EMPERADOR INC.
Slide 25: Track Record of Robust Growth & Profitability
Track Record of Robust Growth & Profitability Revenue EBITDA & margin NPAT2 & margin (PHPm) EBITDA (PHPm) EBITDA margin NPAT (PHPm) NPAT margin 20.1% 52,834 30.9% 51,565 47,050 15.1% 15.4% 14.2% 13.0% 22.0% 21.9% 22.4% 21.5% 25,331 21,540 7,967 11,0801 11,552 6,658 6,726 10,332 7,825 5,084 4,827 3,3
Slide 26: Brandy Segment – Growth with Profitability
Brandy Segment – Growth with Profitability Revenue¹ EBITDA & margin² (PHPm) EBITDA (PHPm) EBITDA margin 31.6% 37,627 36,891 33,681 22.8% 23.0% 21.9% 22.5% 16,341 14,901 7,870 8,4143 8,473 5,262 3,466 2018 2019 2020 1H20 1H21 2018 2019 2020 1H20 1H21 Commentary ✓◼ Brandy segment has continued to deli
Slide 27: Whisky Segment – Growth Profile & Expanding Profitability
Whisky Segment – Growth Profile & Expanding Profitability Revenue¹ Gross profit margin3 evolution (PHPm) Branded Private label Bulk 40.6% 39.7% 39.8% 36.1% 32.7% 34.1% EMP vs Select mkt 30.1% 15,943 markets growth2 10% 13,938 13,369 5.2x 7% 8% 21% 23% 4.7x 2016 2017 2018 2019 2020 1H20 1H21 22% EBIT
Slide 28: Key Drivers for our Sustainable Profitability
Key Drivers for our Sustainable Profitability Our drivers to deliver sustainable and expanding profitability going forward ✓ ◼ Continued growth in mix of branded business Increased focus on brands ◼ Historically, branded mix of total whisky segment has increased from 53% between 2011-14 to 69% in 20
Slide 29: Closing Remarks
Closing Remarks
Slide 30: A Truly Global Player, with a Track Record of Solid Growth Momentum
A Truly Global Player, with a Track Record of Solid Growth Momentum #1 brandy player #5 largest Scotch whisky #6 largest single malt globally by volume1 manufacturer in the world2 producer in the world3 Solid growth momentum in FY2020 (despite COVID-19) "…traces its roots back to Glasgow in 1844…" W
Slide 31: A Clear Plan for Future Growth
A Clear Plan for Future Growth We have a clear strategy in mind to propel the next phase of growth for Emperador 1 Relentless focus on already sizeable and growing Scotch whisky and brandy segments 2 Exploit premiumization trends through the value span of our portfolio and by levering on customer in
Slide 32: Q&A
Q&A C-$oFo EMPERADOR INC.
Slide 33: Appendix: Whisky Portfolio Overview, Business Capabilities
APPENDIX Whisky Portfolio Overview Business Capabilities
Slide 34: The Dalmore – The #7 Single Malt Brand Globally
The Dalmore – The #7 Single Malt Brand Globally1 OUR VISION To be the world’s most desirable malt whisky, discovered and available in the finest locations globally PAGE 34 Source: Company information, IWSR Note: 1 Ranking based on 2020 value 34
Slide 35: The Dalmore – The fastest growing Single Malt by value globally
The Dalmore – and THE fastest growing Single Malt by value globally1 ▪ The Dalmore is a luxury brand thriving at the apex of the category ▪ The Dalmore has outpaced the category on volume and value ▪ Key focus on growth in Asia and US ▪ Demand outstrips supply ▪ The Dalmore has an unrivalled catalog
Slide 36: Fettercairn – The Super Premium Single Malt
Fettercairn – The Super Premium Single Malt OUR VISION Establish Fettercairn as an exceptionally refined, super premium single malt 36
Slide 37: Fettercairn – An unexploited Gem With Great Potential
Fettercairn – An unexploited Gem With Great Potential ▪ With all the credentials of a highly prized single malt, we re-launched the brand in 2018 ▪ Intending to follow a similar path to that taken nearly ten years earlier by The Dalmore ▪ Enjoying a strong reception by category influencers and key c
Slide 38: Jura – The #13 Single Malt Scotch By Volume Globally in 2020
Jura – The #13 Single Malt Scotch By Volume Globally in 20201 Jura’s brand heritage, positioning and taste profile have formed a solid foundation for its rapid growth OUR VISION To become a top 10 global single malt brand by volume and value Source: Company information, IWSR Note: 1 Rankings based o
Slide 39: Jura – The #1 Single Malt By Volume in UK in 2020
Jura – The #1 Single Malt By Volume in UK in 20201 Jura targets younger consumers and drives physical availability to enable rapid growth ▪ A premium and super premium malt, targeted against scale brands in the category ▪ Repositioned in 2018 to appeal to a wider audience ▪ #13 Single Malt Scotch br
Slide 40: Tamnavulin – #1 Fastest Growing Single Malt Globally
Tamnavulin – #1 Fastest Growing Single Malt Globally1 Building Upon Strong Brand Building and Product Development Capabilities OUR VISION Our ambition is to be the most available and visible, affordable single malt brand globally Source: Company information, IWSR Note: 1 Based on absolute volume gro
Slide 41: Tamnavulin – A Single Malt at Compelling Value
Tamnavulin – A Single Malt at Compelling Value ▪ Introduced through one UK retailer in 2016, then expanded to all UK retail in 2017 and Europe and Travel Retail from 2018 ▪ Accessible progression for blended whisky drinks in both taste and price ▪ #1 in Sweden and #10 in Europe by volume1 ▪ #20 Sing
Slide 42: 3 Brands in Top 25 Single Malts
3 Brands in Top 25 Single Malts Whyte & Mackay has successfully placed three of its iconic brands in the coveted top 25 single malt whiskies in the world Volume (‘000 8.4 c/s)1 #12 #13 #20 Value (GBP’000)2 #7 #15 #23 Source: Company information based on IWSR data Note: For Single Malt Scotch whisky,
Slide 43: Appendix: Whisky Overview, Business Capabilities
APPENDIX Whisky Overview Business Capabilities
Slide 44: Whyte & Mackay – Production Capabilities and Heritage
Whyte & Mackay – Production Capabilities and Heritage The unique 4+1 distilleries (4 malt and 1 grain) assets solidified W&M’s leading position as a global whisky player Tamnavulin Distillery Invergordon Distillery Bottling Operations 7m 8.4L Cs Invergordon per year 5 bottling lines 1966 Dalmore 196
Slide 45: Our Production Capabilities – Spain
Our Production Capabilities – Spain Our Spanish production facilities include cellars dating back to the 16th to 19th centuries, making our production capabilities unique Vineyards - Distillery – Tomelloso Cellars - Jerez de la Frontera Jerez de la Frontera (Bodegas Fundador) Maturing, Blending Vine
Slide 46: Our Production Capabilities – Mexico
Our Production Capabilities – Mexico Our facilities allowed us to produce brandy, through a third-party joint production agreement, and wine, with full control over the process in Mexico Villahermosa Mexico City Guadalupe Valley 150 pallets capacity Blending, maturing, bottling & packaging owned by
Slide 47: Our Production Capabilities – Philippines
Our Production Capabilities – Philippines Our production assets in the Philippines will soon see the addition of a bottle washing facility located in Biñan, Laguna, in line with process improvement and sustainability objectives of the Group Santa Rosa, Laguna Calamba, Laguna Main Plant – Blending an
Slide 48: Our Procurement and Inventory Management
Our Procurement and Inventory Management Selected principal raw materials Examples of dry goods Grapes Bottles ◼ Spain: Sourced from our vineyards and third-parties as needed ◼ Philippines: Sourced from Anglo Watsons Glass, a wholly- ◼ Mexico: Sourced from various suppliers owned subsidiary of EDI,
Slide 49: New Product Development and Pipeline
New Product Development and Pipeline The sustained growth of Emperador was driven by continuous innovation and marketing activities Fruity Mix by The BaR Jura 12 YO Sherry Cask A clear ultralight alcoholic A rich, fruity and vibrant whisky beverage that features a profile that unites the heart of Ju
Slide 50: Above-the-line marketing
Comprehensive Marketing and Branding Approach We lever on above the line marketing channels to increase visibility… 1. Above-the-line marketing Television commercials Consistent appearances on television commercials on main TV channels and online ads Billboards and print ads Product recommendations
Slide 51: Below-the-line marketing
Comprehensive Marketing and Branding Approach (cont’d) …and we complement with below the line marketing for customer activation and to drive brand positioning 2. Below-the-line marketing Silent auction of a one-off 60-year old whisky Partnership with Harrods, the world famous luxury retailer Travel
Slide 52: EMPERADOR INC.
EMPERADOR INC.