Chocoladefabriken Lindt & Spruengli Ag · SIX:LISN
Chocoladefabriken Lindt & Spruengli — Chocoladefabriken Lindt & Sprüngli — FY2023 Earnings Presentation
59 slides from Chocoladefabriken Lindt & Spruengli's earnings presentation, Mar 5, 2024
Slide 1: Slide 1
Slide 2: Financial Year 2023
Financial Year 2023 March 5, 2024
Slide 3: Agenda
01 Key Figures & Market Trends 02 Market Insights & Highlights 03 Financial Results 2023 04 Sustainability 05 Growth Agenda & Outlook 06 Q&A
Slide 4: Group Management
Group Adalbert Lechner Martin Hug Jennifer Picenoni Rolf Fallegger Group CEO Group CFO General Counsel & Country Responsibility Management Corporate Secretary 167 years of experience at Lindt & Sprüngli Alain Germiquet Guido Steiner Daniel Studer Nicole Uhrmeister Country Responsibility Internationa
Slide 5: Ana Maria Dominguez
Ana Maria Dominguez • Born in Colombia, Canadian citizen • Over 30 years of experience in FMCG such as Campbell Company and SC Johnson • Joined Lindt & Sprüngli in 2019 as CEO Canada • Took over as CEO USA in 2022 • Member of the Group Management as of July 1, 2024
Slide 6: Financial Key Figures
+10.3% 15.6% Organic sales growth EBIT margin +4.6% in CHF +60bp vs. PY CHF 813 mn 5.20 bn Group sales (CHF) Financial Key Figures +0.2% 1,400 CHF Volume/Mix growth Lindt & Sprüngli achieved Dividend +7.7% vs. PY double-digit growth in 2023 9.2% Free Cash Flow margin CHF 477 mn
Slide 7: Sustainability at a glance
Near- & long-term 72.3% climate targets of cocoa products sourced through Net-zero science-based target by 2050 sustainability programs 131,000 farmers in the Lindt & Sprüngli Farming Program 66.1% of cocoa volume from child labor risk countries where a CLMRS has started or is implemented Sustainabi
Slide 8: Global Chocolate Markets and Trends in 2023
Global Chocolate Markets and Trends in 2023 Chocolate markets with slight volume decline but growth in value Global chocolate market Cocoa price inflation impacted by price increases Trends Volume decline − value with high- Cocoa price rose to historic highs Premium chocolate single-digit growth + +
Slide 9: Market Insights & Highlights
Market Insights & Highlights
Slide 10: Total Group Sales CHF 5.20 bn
5.20 0. 5 3 bn TOTAL GROUP SALES CHF 1 24 +10.3% organic growth
Slide 11: Sales Analysis Markets
40.6% organic growth 11.0% REST OF THE WORLD NORT H AME RI CA Sales Analysis + + EUROPE Markets 13.1% organic growth 12.9% Lindt & Sprüngli achieves + double-digit growth to CHF 5.20 bn which corresponds to an 46.3% increase of 4.6% in CHF organic growth 9.1%
Slide 12: Europe Market Split
46.3% Largest region of the group 2.41 bn REST OF THE WORLD NORT H AME RI CA Market Split Total sales in CHF + EUROPE Europe +9.1% 40.6% organic growth 14.7% 5.7% Germany Italy 8.0% 3.9% France CH (excl. DIS and GTR) o 13.1% 6.3% 2.2% 5.5% UK CEE Rest of Europe
Slide 13: Europe Key Facts
Sales Growth in all markets (organic) Germany France UK Italy (+7.0%) (+5.3%) ( +10.0%) (+11.1%) Switzerland CEE Iberia Austria Nordic (+10.4%) ( +20.4%) (+10.7%) (+10.6%) (+7.3%) REST OF THE WORLD NORT H AME RI CA Key Facts 1 Strong growth in Germany despite depressed consumer EUROPE Europe sentime
Slide 14: Europe
Europe
Slide 15: Lindt Choco Wafer
Lindt Choco Wafer Attracts younger, less affluent shoppers to our brand In the UK, for example, 44% of Choco Wafer shoppers were new to Lindt brand
Slide 16: North America Market Split
40.6% 2nd largest region 2.11 bn REST OF THE WORLD Total sales in CHF NORT H AME RI CA Market Split North +11.0% EUROPE America organic growth 40.6% 34.8% 5.3% 0.5% USA Canada Mexico 13.1
Slide 17: North America Highlights
Strong double-digit growth across subsidiaries Lindt USA Ghirardelli Russell Stover (+14.0%) (+11.6%) (+5.8%) Canada Mexico ( +10.1%) (-2.2%) REST OF THE WORLD NORT H AME RI CA Highlights 1 Further increase in the segment’s EBIT margin: from 10.9% in 2022 to 11.8% (rise by 90 bp) EUROPE North Lindt
Slide 18: North America
VO Va any tn vat mat North America
Slide 19: Super Bowl
Super Bowl For the first time ever, we launched a Lindor spot at 2024 Super Bowl – an event with >123 million viewers Rated #4 of 70 by marketing researcher System 1 Reached 1.5 billion consumers, generated 195 articles in media worldwide
Slide 20: Rest of the World Market Split
13.1% 3rd largest region REST OF THE WORLD NORT H AME RI CA Market Split Rest of the 0.68 bn EUROPE Total sales in CHF World 40.6% +12.9% organic growth
Slide 21: Rest of the World Highlights
Global Travel Retail and Japan with high growth Japan Global Travel Retail Distributors (+21.3%) (+20.1%) (+14.4%) Brazil China Australia (+11.8%) (+8.5%) (+7.7%) REST OF THE WORLD NORT H AME RI CA Highlights 1 Japan: Further expansion of retail network EUROPE Rest of 2 Global Travel Retail: Recover
Slide 22: Rest of the World
Rest of the World
Slide 23: Ramadan
Ramadan Lindt & Sprüngli produced a Lindor TV spot for Ramadan and Eid, shown in the Middle East
Slide 24: Direct to Consumer business (Global Retail)
Direct to Consumer business (Global Retail) (NTS reported in countries) +16.5% Unique brand building opportunity and premium shopping experience Organic sales growth Refit of flagship shop Paris Opera +12.5% comp. store growth 523 + Loyalty program “MyLindt” gives us access to first party data Physi
Slide 25: Financial Results 2023
Financial Results 2023
Slide 26: Overview – Year 2023
15.6% 2,889 15.0% 2,416 Overview – 10.8% 10.3% 10.6% 9.2% Year 2023 943 Key performance 571 indicators remain strong 2022 2023 2022 2023 2022 2023 2022 2023 2022 2023 Organic EBIT Free CF Earnings Net debt growth margin margin per share position (CHF) (CHF million)
Slide 27: Shareholder Return
2019 2020 2021 2022 2023 Ordinary dividend 1,050 1,100 1,200 1,300 1,400* reg. (CHF) Shareholder Special dividend 700 - - - - Return (CHF) Increase in shareholder Dividend yield reg. 2.0% 1.2% 1.0% 1.4% 1.4% return continues Payout ratio 83.2% 82.5% 59.3% 54.6% 49.2% Share buyback (CHF million) 337
Slide 28: Share price & Market Capitalization
Registered shares (at year-end in CHF) Market capitalization (CHF million) 122,200 102,000 95,000 88,400 Share price & 85,500 Market Capitalization 30,035 22,679 23,958 19,688 20,994 2019 2018 2020 2021 2022 2023
Slide 29: Sales Growth Organic (in %)
2023 10.3% Sales Growth 2022 10.8% Organic (in %) 2021 13.3% Compound average growth rate in the last 5 years of 6.6% (despite the 2020 -6.1% pandemic) 2019 6.1%
Slide 30: Sales Growth in CHF
Absolute in CHF million (as published) Growth rate in % (as published) 5,201 4,970 4,509 4,585 4,017 Sales Growth 14.2% in CHF 8.4% 4.5% 4.6% Sales reaching a new record high -10.9% of CHF 5.2 billion despite the strengthening of CHF 2019 2020 2021 2022 2023
Slide 31: Sales: Growth Factors
Growth rate in % 10.1% 0.2% 10.3% -0.3% 10.0% -5.4% Sales: Growth Factors Organic growth of 10.3% 4.6% driven by price while volume/mix still positive Price Volume/Mix Organic L&S Russia Incl. L&S Forex In CHF Russia
Slide 32: Sales Analysis: Segment Information
Growth rate in % (organic) Absolute in CHF million (as published) Europe North America Rest of the World 16.6% 15.7% 646 2,029 Sales Analysis: 12.9% 683 Segment 11.0% 2,111 Information 9.1% 2,407 Strong growth across all 5.3% segments 2,296 2022 2023 2022 2023 2022 2023
Slide 33: Material Costs incl. Change in Inventories
Absolute in CHF million Ratio in % to sales 1,678 1,706 1,518 1,518 1,422 Material Costs incl. Change in Inventories Price increases and positive mix impact 35.3% compensate material 33.6% 33.8% 33.1% 32.9% cost increases 2019 2020 2021 2022 2023
Slide 34: Cocoa Price
Cocoa Price Price of cocoa bean futures has more than doubled since the beginning of 2023 Cocoa bean prices 6,000 in GBP/t 5,000 4,000 Chart does not include LID (USD 400/mt) which the 3,000 Lindt & Sprüngli Group 2,000 paid since its introduction in October 2020 1,000 0 Jan/23 Feb/23 Mar/23 Apr/23
Slide 35: Personnel Expenses
Absolute in CHF million Ratio in % to sales 1,026 1,008 979 986 Personnel Expenses Positive trend continues 885 21.7% 22.0% 21.5% 20.3% 19.7% 2019 2020 2021 2022 2023
Slide 36: Operating Expenses
Absolute in CHF million Ratio in % to sales 1,404 1,295 1,191 1,113 Operating 1,036 Expenses 27.0% Increased brand support with 25.9% 26.0% 26.0% continued efficiency in logistics 24.7% 2019 2020 2021 2022 2023
Slide 37: Depreciation and Impairments
Depreciation and Impairments Slight decrease in percentage of sales driven by economies of scale Absolute in CHF million Ratio in % to sales 323 281 276 277 273 7.2% 6.9% 6.0% 5.5% 5.4% 2019 2020 2021 2022 2023
Slide 38: Operating Profit (EBIT)
Operating Profit (EBIT) EBIT-margin continues to improve by a further 60 bp in 2023 Absolute in CHF million Margin in % to sales 813 745 645 593 420 14.1% 15.0% 15.6% 13.2% 10.5% 2019 2020 2021 2022 2023
Slide 39: EBIT by Segment
EBIT-margin in % Absolute in CHF million Europe North America Rest of the World EBIT by Segment 17.8% 19.2% 17.8% Continuous increase of 461 409 115 15.0% profitability in North America; 102 11.8% Investment for future growth 10.9% 250 (brand, people) in Rest of the 221 World 2022 2023 2022 2023 202
Slide 40: EBITDA
EBITDA Achieving record levels Absolute in CHF million Margin in % to sales 1,094 1,018 916 921 696 20.3% 20.1% 20.5% 21.0% 17.4% 2019 2020 2021 2022 2023
Slide 41: Tax Rate
In % of income before taxes 23.6% Adjusted 21.1% 21.0% 18.8% Tax Rate 8.9%* Tax rate as reported provides a one time benefit in 2023. Excluding the Swiss STAF 8.8%* DTA regulation the adjusted 14.7% As reported figure would be higher than previous years. 2019 2020 2021 2022 2023 * one-off tax benefi
Slide 42: Net Income
Net Income Strong increase of Net Income margin is positively impacted by the one-off tax benefit Excluding the one-off impact the Net Income margin is at 11.6% Absolute in CHF million Margin in % to sales 671 570 70* 512 491 601 320 12.9% 11.4% 11.5% 10.7% 8.0% 2019 2020 2021 2022 2023 * One-off ta
Slide 43: Capital Expenditure
Absolute in CHF million 302 Capital 235 249 241 230 Expenditure Continued investments into growth and efficiency: Cocoa mass production in Olten (Switzerland) and capacity increase in Stratham (USA) 2019 2020 2021 2022 2023
Slide 44: Free Cash Flow
Free Cash Flow Solid Free Cash Flow impacted by higher Cocoa inventories and a catch up in CAPEX Absolute in CHF million 596 585 Margin in % to sales 539 526 477 13.2% 13.4% 12.8% 10.6% 9.2% 2019 2020 2021 2022 2023
Slide 45: Non-diluted Earnings per Share
Absolute in CHF 2,889 2,416 2,142 2,049 Non-diluted Earnings 1,333 per Share* Substantial increase of EPS 2019 2020 2021 2022 2023 * equivalent to 10 PC
Slide 46: Net Financial Position
Net Financial Position Increase in Net Debt Position driven by high shareholder return EBITDA multiple of 0.86 Free cashflow = 477 + Absolute in CHF million -302 Shareholder return = 898 +779 -304 -571 + -943 -594 +111 -62 01/01/2023 Operating cash CAPEX Dividend Share buyback Capital increase Other
Slide 47: Equity Ratio
In % of total assets 58.1% 57.2% 58.3% 55.4% 54.2% Equity Ratio Balance sheet remains strong 2019 2020 2021 2022 2023
Slide 48: Sustainability
@ LINDT & SPRUNGLI Sustainability
Slide 49: The Lindt & Sprüngli Sustainability Plan
The Lindt & Sprüngli Sustainability Plan Our commitment for a better tomorrow Our Sustainability Plan purpose pillars and objectives: – Improve the livelihoods of people in our supply chain – Contribute to an intact environment – Foster successful collaboration within the company and – Delight our c
Slide 50: Our net-zero roadmap
Our net-zero roadmap Lindt & Sprüngli has approved near- and long-term science-based emissions reduction targets with the SBTi. The SBTi has also verified Lindt & Sprüngli’s net-zero science-based target by 2050. 2020 2023 2025 No deforestation across our primary deforestation-linked commodities 203
Slide 51: Lindt & Sprüngli Farming Program for Cocoa
The Farming Program aims to create decent and resilient livelihoods for cocoa farmers and their families and encourages more sustainable farming practices. Vision Increased resilience of farming households Lindt & Reduced risk of child labor Sprüngli Objectives Conservation of biodiversity & natural
Slide 52: Outlook: Cocoa Strategy
Medium to long term + + Financial Year Outlook: 2024 Cocoa Strategy We are evolving our cocoa Partnerships Human Rights Climate & Biodiversity sustainability strategy by 2030 Engaging in strategic Living income project with Establishing agroforestry with partnerships with key actors, 5,000 cocoa far
Slide 53: Growth Agenda & Outlook
#4 LINDT & SPRUNGLI Growth Agenda & Outlook
Slide 54: Building on our Strengths
Building on our Strengths Focus areas include: • New Segments Stretch • New Markets • Emerging Markets • Sustainability • DEI • Digitization Adapt • RGM • Secondary Franchises • Gifting • Key Markets & Key Franchises Leverage • Success proven business model our Strengths • • Entrepreneurial culture
Slide 55: The Lindt & Sprüngli Way to Growth
1 Growth enablers Optimize brand support Free up funds via RGM / cost reduction Capitalize potential of secondary franchises Strong focus behind gifting 2 Premium Nurture brand equity Invest in quality and reputation The Secure margins Lindt & Sprüngli 3 Innovation Way to Growth Enchant consumers Co
Slide 56: Outlook
Financial Year Medium to → 2024 long term Outlook Lindt & Sprüngli will continue to grow stronger than the market Cocoa price hikes requires 6-8% 6-8% price increase in 2024/25 Organic sales growth Expected sales growth per year Continued record-high brand support to drive volume 20-40 bp Improvemen
Slide 57: Q&A
Q&A
Slide 58: : LINDT ea SPRUNGLI
: LINDT ea SPRUNGLI Cha IN
Slide 59: Disclaimer
Disclaimer This presentation contains forward-looking statements which reflect the management’s current views and estimates. The forward-looking statements involve certain risks and uncertainties that could cause actual results to differ materially from those contained in the forward-looking stateme
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