Kofola Ceskoslovensko As · PSECZ:KOFOL

Kofola Ceskoslovensko As — Non-Deal Roadshow (May 2018)

36 slides from Kofola Ceskoslovensko As's roadshow presentation, May 2018

  1. Slide 1: Company presentation – Road show May 2018

    Secantengiess W kofola | SOFT DRINKS { GeskoSlovenska = _ LE ADER | Company presentation Koad show MAY 2016

  2. Slide 2: One of the most significant producers of non-alcoholic beverages in CEE and SEE

    One of the most significant producers of non-alcoholic beverages in CEE and SEE Revenues 12M17: € 264M EBITDA 12M17: € 36M 8 production plants 2,182 employees EUR/CZK ex. rate: 26.330 2

  3. Slide 3: Current ownership structure

    Current ownership structure Free float 6.04% OWN shares 5.00% AETOS a.s. 68.00% CED Group S.a.r.l. 20.96% … … … 3

  4. Slide 4: Vision Fok Kofola

    VISION FOK KOFOLA We want to become the soft drinks market leader in CzechoSlovakia_and Adriatic region We want to anchor UGO and Leros as the leaders and creators of fresh and healthy drinks and develop new leg of business. We will continue growing organically and via_acauisitions. We will continue

  5. Slide 5: Market positions by country

    No. 1 player in the soft No. 2 player in the soft drinks market drinks market in Slovenia 3rd most admired company No. 1 water brand in both UGO leader in healthy live style refreshment Retail & HoReCa No. 2 water brand No. 2 syrup brand No. 1 Player in the soft drinks market both in Retail & HoReCa

  6. Slide 6: Exposure to consumers in the CEE markets

    Exposure to consumers in the CEE Focus on the smaller markets, markets with booming retail difficult for global players to enter, consumptions, falling unemployment and offering higher profitability and growing salaries Strong brands, unique positioning Benefit from very strong cash flow (HoReCa) an

  7. Slide 7: Company history and acquisitions

    Acquisition of Acquisition Vinea brand in of Ugo group Slovakia (most (fresh juices) popular CSD in Slovakia) 2017 2015 HoReCa started Expansion into a new in Czechia & 2012 segment of healthy Slovakia Expansion into the products Establishment of Adriatic region Acquisition of Premium the Kofola bra

  8. Slide 8: Portfolio of strong brands

    “oto is 2 best traditional Czech brand Gig: = Bata — MAOH eee onIv 8 ater spont ‘among the top § most successful traditional Czech brands The conolte porttolio of strong brands Kofola : * herbal cola drink m 307 less sugar no acid phosphoric © chs Ges mmeRos arctic’ = Chito ” Studenac 2D studena. —c

  9. Slide 9: Kofola retail market share (value)

    Kofola Retail market share (VALUE) 25% 25% Kofola gain vs. Competitor 1 Kofola gain vs. Competitor 1 +3.7 %p. +7.1 %p. 20% 20% 19% 15% 15% 17% 15% 13% 10% 10% 5% 5% 2012 2013 2014 2015 2016 2017 2012 2013 2014 2015 2016 2017 Kofola Competitor 1 Competitor 2 Competitor 3 Based on AC Nielsen and Data

  10. Slide 10: Kofola HoReCa market share (volume)

    Kofola HoReCa market share (VOLUME) 50% 50% Kofola gain vs. Competitor 1 40% 40% +3.4 %p. Kofola gain vs. Competitor 1 30% +7.4 %p. 30% 35% 31% 20% 24% 20% 20% 10% 10% 0% 0% 2012 2013 2014 2015 2016 2017 2012 2013 2014 2015 2016 2017 Kofola Competitor 1 Competitor 2 Competitor 3 Based on AC Nielsen

  11. Slide 11: HoReCa channel advantages

    • High market entry barriers leading to limited competition – usually only 2 global players + 1 local like Kofola • Higher margins comparing to retail channel • Loyalty – low fluctuation of clients • Additional marketing tool supporting brand awareness • Successful direct distribution model 11

  12. Slide 12: Successful acquisitions

  13. Slide 13: 2017 – Studenac Acquisition

    2017 – STUDENAC Acquisition Rising revenues in Croatia also thanks Radenska and Pepsi. Croatian market oportunity due to bankruptcy of Agrokor. We see potential upside to increase our market share 13

  14. Slide 14: In March 2018 acquired LEROS

    In March 2018 acquired LEROS – leading Important part of the healthy lifestyle producer of high quality products from medicinal strategy of Kofola (July 2017). plants and quality natural teas. Start up that records double-digit sales growth. 40-year tradition, leading share in pharmacy Kofola will e

  15. Slide 15: UGO healthy lifestyle innovation

    Ge UGO healthy ife style innovation

  16. Slide 16: Ugo bars sales and number of bars

    Ugo bars sales Substantial increase in number of bars (CZK m) 479 379 84 128 73 118 61 39 50 351 261 20 12 45 2016 2017 Own Franchises 2012 2013 2014 2015 2016 2017 16

  17. Slide 17: Consolidated Financial Performance Indicators

    Consolidated Financial Performance Indicators

  18. Slide 18: Brand revenues and total revenues

    Brand revenues Total revenues CS Adriatic PL UGO Private 5,934 6,200 1 488 1 065 763 label 5,703 728 612 1 743 1 574 4,545 4,701 889 817 1 060 1 034 595 1 058 5 703 5 934 6 200 Branded 4 128 4 177 4 545 4 701 3 570 4 041 3 470 [CZKm] [CZKm] 2013 2014 2015 2016 2017 2013 2014 2015 2016 2017 Constant

  19. Slide 19: EBITDA and Guidance for 2018

    Guidance for 2018 1,000 MCZK CZ+SK SEE Poland 1,103 1,064 EBITDA growth in 2013 – 2015 resulting from 229 business improvement on all Kofola markets and 133 950 915 channels 22 Total 820 196 146 CAGR 4% CZ + SK + Adriatic markets showed stable growth in 120 188 EBITDA 180 Net decrease in total EBITD

  20. Slide 20: Results comparison 3M18 vs 3M17

    Results comparison 3M18 3M17 Change Change • Revenue grew in all segments except CZK mil. CZK mil. CZK mil. % Poland. Main increase in Czechia, thanks Revenue 1 434.0 1 343.5 90.4 6.7% to Kofola, Rauch, Vinea and increased Cost of sales (894.3) (873.3) (21.0) 2.4% sales in Ugo. Sales in the Adriatic

  21. Slide 21: Kofola Group LTM EBITDA

    en KOFOLA Group LIM (Last Twelve Months) EBITDA 980 KOFOLA LTM EBITDA KOFOLAGROUP milCZK _ 1Q17 (mil C2k) 968 —LTM Revenue 6876 6866 6927 6963 7054 LTM Gross profit 2741 2762 2808 2829 2909 LTM EBITDA adjusted 990 899 919 950 968 14% 13% 13% 14% 14% LTM margin 950 919 899 | : IMPROVING PERFORMANCE I

  22. Slide 22: Sugar price and raw material costs

    • Sugar price increase 17/16: +10,5%. • Direct impact on EBITDA: - €3M • OCT 2017: the end of EU sugar import quotas • Positive sugar price development in 2018 • Stabilization on world sugar price in next years 37 37 (m EUR) 520 180% 18 (m EUR) 180% 975 36 490 160% 17 460 16 160% 950 430 140% 140% 4

  23. Slide 23: Dividend policy, cash flow and CAPEX

    Aim of dividend distribution to shareholders * of Kofola of at least 60% of its consolidated net profit achieved in each financial year from 2017 until 2020, subject to sufficient distributable profits. *dividend 2018 - suggested by majority shareholder Operating Cash Flow / EBITDA 2017: 76% Net deb

  24. Slide 24: Poland

    • Experienced management with commercial background and focus on results improvement. • Production efficiency optimization with focus on own brands, supported by private labels. • Lower sales but standard profitability (target 10%). • Concentration of production in one plant (Kutno), the most modern

  25. Slide 25: HOOP divestment contingency plan

    A contingency plan assumes divestment of the HOOP business in 2018 Our successful acquisition Premium Rosa will be integrated with LEROS – a new healthy segment 12M17 12M16 Change Change Group Results 12M* - without HOOP CZK mil. CZK mil. CZK mil. % HOOP exit impact to Kofola Revenue 5 761.0 5 262.5

  26. Slide 26: Disclaimer

    This presentation (“the Presentation”) has been prepared by Kofola ČeskoSlovensko a.s. (“the Company”). The Company has prepared the Presentation with due care, however certain inconsistencies or omissions might have appeared in it. Therefore it is recommended that any person who intends to undertak

  27. Slide 27: Appendix

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  28. Slide 28: Adjusted consolidated financial results

    Adjusted consolidated financial results 3M18 3M17 2017* 2016* 2015* 2014* 2013* CZK´000 CZK´000 CZK´000 CZK´000 CZK´000 CZK´000 CZK´000 Revenue 1,433,952 1,343,528 6,963,278 6,998,960 7,190,838 6,275 391 6,287,894 Cost of sales (894,272) (873,303) (4,134,081) (4,211,593) (4,352,102) (3,881 359) (4,3

  29. Slide 29: Consolidated statement of financial position

    Consolidated statement of financial position 31.3.2018 31.3.2017 31.12.2017 31.12.2016 31.12.2015** 31.12.2014 31.12.2013 CZK´000 CZK´000 CZK´000 CZK´000 CZK´000 CZK´000 CZK´000 Non-current assets 4,843,700 4,930,977 4,786,195 4,915,863 5,095,724 4,171,985 6,287,894 Current assets 1,935,599 2,922,66

  30. Slide 30: Reconciliation of reported and adjusted results 3M18

    Reconciliation of reported and Reported One-offs Adjusted One-offs: adjusted results CZK mil. CZK mil. CZK mil. Revenue 1 434.0 - 1 434.0 •Net other operating income from the sale of Cost of sales (894.3) - (894.3) production lines in Poland of CZK 4.6 mil. Gross profit 539.7 - 539.7 Selling, market

  31. Slide 31: Results comparison 4Q17 vs 4Q16

    4Q17 4Q16 Results comparison Change Change +1Q18 +1Q17 CZK mil. CZK mil. CZK mil. % Revenue 3 043.2 2 916.7 126.5 4.3% Cost of sales (1 872.3) (1 847.2) (25.1) 1.4% Key products price increased Gross profit 1 170.9 1 069.5 101.4 9.5% Successful innovations launch (Royal Crown) Selling, marketing and

  32. Slide 32: Reconciliation of reported and adjusted results 2017

    Reconciliation of reported and One-offs: Reported One-offs Adjusted adjusted results • Net operating income from the sale of warehouse of CZK 2.9 CZK mil. CZK mil. CZK mil. mil. Revenue 6 963.3 - 6 963.3 (in Slovenian segment). Cost of sales (4 134.1) - (4 134.1) • Costs connected with SAP implement

  33. Slide 33: Results comparison 12M17 vs 12M16

    • Revenue decrease caused by lower sales in Poland that Results comparison 12M17 12M16 Change Change were partially offset by the increase in CzechoSlovakia from Rajec, Rauch, Semtex and mainly Vinea, increased sales in CZK mil. CZK mil. CZK mil. % Ugo and increased sales in Slovenia and Croatia. Re

  34. Slide 34: Revenues by country

    (CZK m) 2016 2017 • Czech Republic Revenues increased by 3.3%, due to increased sales of Rauch, Rajec, Vinea and Semtex. UGO increased revenue by 39.2%. 2 808 2 899 • Slovakia Revenues growing by 3.0%, keeping leading position in both Retail and HoReCa segment in terms of market share. Sales in 1 62

  35. Slide 35: Macroeconomic outlook: GDP growth and public debt in CEE

    Real GDP growth of 1,6 4,5 Slovenia 2017 2018 between 2.8 – 4.7% is 5,0 2018 0,8 expected this year in CEE Slovakia 3,9 2017 3,4 0,3 and Austria. Real GDP 4,7 0,0 0,0 growth to be driven by Romania 6,9 solid domestic demand, 4,2 Poland 4,6 -0,4 -0,3 as wage growth and -0,7 Hungary 3,7 -1,0-1,0 decli

  36. Slide 36: Macroeconomic indicators by country

    Real GDP growth (%) 2016 2017f 2018f 2019f Average inflation (%) 2016 2017f 2018f 2019f Croatia 3.2 2.8 2.8 2.7 Croatia -1.1 1.1 1.4 1.9 Czech Republic 2.5 4.6 3.4 2.9 Czech Republic 0.7 2.5 2.1 1.9 Hungary 2.2 4.0 3.7 3.3 Hungary 0.4 2.4 2.4 3.5 Poland 2.9 4.6 4.2 3.3 Poland -0.6 2.0 1.7 2.2 Romani

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