Purcari Wineries Public Co., Ltd. · BVB:WINE
Purcari Wineries Public — Purcari Wineries — FY2019 Earnings Presentation
25 slides from Purcari Wineries Public's earnings presentation, Feb 28, 2020
Slide 1: Purcari Wineries Plc 2019 Preliminary unaudited results presentation
Purcari Wineries Plc 2019 Preliminary unaudited results presentation February 28, 2020 Page 1
Slide 2: Disclaimer
Disclaimer THIS PRESENTATION IS MADE AVAILABLE ON THIS WEBSITE BY PURCARI WINERIES PUBLIC COMPANY LIMITED (the Company) AND IS FOR INFORMATION PURPOSES ONLY. This presentation and its contents do not, and are not intended to, constitute or form part of, and should not be construed as, constituting o
Slide 3: Today's presenters
Today’s presenters Victor Bostan Eugen Comendant Victor Arapan Vasile Tofan CEO, Founder COO CFO Chairman ▪ Founded the Group in ▪ Over 10 years of ▪ 20 years of experience in ▪ Over 10 years experience 2002 management experience banking, audit, corporate in FMCG ▪ Over 35 years of finance ▪ Ex Virg
Slide 4: Agenda
Agenda Our newest 1 Our Group launch, Malbec de Purcari, tapping the global Malbec phenomenon, a 2 2019 Operational Results fruit-bomb and big hit with consumers. 3 2020 Outlook 4 Q&A Page 4
Slide 5: Purcari Wineries at a glance
1 Purcari Wineries at a glance Leading wine player in Romania and the CEE... … with a strong & expanding regional footprint Geographical breakdown of sales in value terms, 2019, % Founded in 1827 by French colonists, Purcari group is now... RO MD PL CN UA Other #1 awarded CEE winery of the year in 2
Slide 6: Our Group: competitive advantage in an attractive market
1 Our Group: competitive advantage in an attractive market Secular shift from Attractive beer, spirits to Competitive #1 premium wine market wine, especially in advantage brand in Romania CEE Plenty to catch Wine growth ’16- #1 most awarded up: wine #1 fastest growing ’20F in Romania CEE winery at c
Slide 7: Our business model: Affordable Luxury
1 Our business model: Affordable Luxury Modern, cost-competitive winemaking Purcari is positioned at the intersections of three themes: ▪ Modern winemaking: the company is brand, as opposed to appellation- centric and runs a cost-efficient business ▪ Affordable luxury: as an aspirational brand, Purc
Slide 8: Our mission, vision and values
1 Our mission, vision and values Our mission Our values To bring joy in people’s lives, by Hungry offering them high quality, inspiring, We win in the marketplace because we want it more ethical wines and excellent value for Ethical money. Always do the right thing and the money will follow Thrifty
Slide 9: Vision: be the consolidator of a fragmented market
1 Vision: be the consolidator of a fragmented market Volume share top-3 players by country, % 79 77 82 74 #3 67 63 68 #2 41 39* 36 18 #1 10 Beer Spirits Wine Beer Spirits Wine Beer Spirits Wine Beer Spirits Wine Unlike beer or spirits, wine market remains very fragmented; players who have the scale
Slide 10: Topping competition at engagement, quality
1 Topping competition at engagement, quality Aspirational brand which consumers like sharing about Highest number of ratings and highest scores on Vivino Number of #brand uses on Instagram, thousand, by key Romanian brands X axis – number of Vivino ratings; Y axis – average Vivino score 10,6 4.1 4.0
Slide 11: Excellent feedback from digital natives, dominate premium segment
1 Excellent feedback from digital natives, dominate premium segment #1 presence in the RON <30 and RON 30-60 segment; Hold 10 out of TOP-25 positions in the crucial RON 30-60 segment • We remain obsessed about the quality of our wines, which pays off in excellent consumer feedback • In our core prem
Slide 12: Quality highly commended, remain the most awarded winery in CEE
1 Quality highly commended, remain the most awarded winery in CEE Leading medal-winning winery1 in CEE at Decanter, Increasing number of medals won from year to year the Wine ”Olympics” # of Decanter medals in 2015 - 19 # of medals #1 52 Mundus Vini 56 Concours Mondial de Bruxelles 45 45 Challenge I
Slide 13: Clear #1 in premium in Romania, keep gaining share, ample headroom
1 Clear #1 in premium in Romania, keep gaining share, ample headroom Overall, Purcari has tripled MS in 5 years…. …while becoming a clear #1 in Premium1 Value share of TOTAL retail market, Romania, % Value share of Premium (RON 30+/liter) retail market, Romania, % 18 Purcari (Group) 24 Samburesti 16
Slide 14: Agenda
Agenda Negru de Purcari 2013, 4.4 score on 1 Our Group Vivino, top 1% wine globally 2 2019 Operational Results 3 2020 Outlook 4 Q&A Page 14
Slide 15: Strong track record of growth
1 Strong track record of growth Revenues EBITDA1 Net Income normalized2 RON m RON m RON m +18% 199 68 +19%2 +23% 44 +29% 42 168 4.2m RON in extraordinary 55 gains from revaluation of 37 stake held in Glass 142 Container Company in 2018 44 29 107 37 23 71 60 18 9 neg 0 2014 2015 2016 2017 2018 2019 2
Slide 16: Key operational highlights for 2019
2 Key operational highlights for 2019 • Robust revenue growth sustained, sales increasing +18% YoY in 2019, to RON 199.1m. Strong revenue • Romania contributing most to the growth, increasing 26% YoY, accompanied by high double-digit growth growth in Moldova and Poland. Very fast growth in Asia +52%
Slide 17: Markets: Romania remains key growth driver, followed by Moldova
2 Markets: Romania remains key growth driver, followed by Moldova Market Share of sales, FY19 Growth, FY19 YoY Comments • RO: Strong Purcari performance, up 37% YoY. Bardar up fourfold, RO 42% +26% albeit from lower base. Crama Ceptura growing at high single-digit rate, launched 360 Ad campaign to b
Slide 18: Premium brands Purcari and Bardar lead the growth
2 Premium brands Purcari and Bardar lead the growth Brand Share of sales, FY19 Growth, FY19 YoY Comments • PURCARI: ongoing strong traction in Romania, ample headroom remains through geographic expansion and traditional trade 42% +33% segment. Double digit growth in Moldova, larger benefits still to
Slide 19: Margins and sales continuous growth
2 Margins and sales continuous growth Comments RON m 2018 2019 ∆ ’19/’18 ▪ Revenue up 18.4%, within guidance range, on strong Revenue 168.1 199.1 18.4% performance of Purcari, Bardar brands. Cost of Sales (85.5) (96.7) 13.2% ▪ COGS lower in Q4 YoY as effect of reversing the provision for Fair Value
Slide 20: IFRS 16 effect reconciliation – relatively minor impact
2 IFRS 16 effect reconciliation – relatively minor impact RON, m Amount before Impact of Amount after Nature of operation Impacted area applying IFRS 16 IFRS 16 applying IFRS 16 Change, % Recognition of right-of-use assets Property, plant and equipment 266.36 8.50 274.86 3% Recognition of lease liab
Slide 21: Agenda
Agenda Freedom Blend, indigenous grapes 1 Our Group from Moldova, Georgia, Ukraine; 91 points by Wine Enthusiast 2 2019 Operational Results 3 2020 Outlook 4 Q&A Page 21
Slide 22: Guidance 2020 – continue robust growth, sustain margins
3 Guidance 2020 – continue robust growth, sustain margins Target 2020 guidance Comments • Romania to remain growth driver, continue focusing on Organic Poland, Czech, Slovakia, Ukraine; continue seeding newer revenue +16-20% markets – Asia, Scandinavia, Germany. growth • Launch a number of new produ
Slide 23: Upgraded production to sustain growth for the years to come
3 Upgraded production to sustain growth for the years to come Purcari Bostavan • Built a new bottling section with • Planted 30 ha of new vineyards storing and warehouse facilities, to be (60ha planned for 2020) fully equipment in 2020 • Acquisition of production facility at • Increased storing capa
Slide 24: Agenda
Agenda Cuvée de Purcari, 1 Our Group the extension to sparkling launched in 2017. Made according to 2 2019 Operational Results the traditional, Champenoise method, with in- 3 2020 Outlook bottle fermentation 4 Q&A Page 24
Slide 25: Thank you.
Thank you. Page 25