Kerry Group Plc · EURONEXT:KRZ
Kerry — H1 2021 Earnings Presentation
28 slides from Kerry's earnings presentation, Jul 29, 2021
Slide 1: Kerry
KERRY
Slide 2: Disclaimer: Forward Looking Statements
Disclaimer: Forward Looking Statements This presentation/announcement may contain forward looking statements with projections regarding, among other things, the Group’s strategy, revenues, earnings, trading profit, trading margin, finance costs, tax rate, capital expenditure, dividends, cash flow, n
Slide 3: Interim Management Statement 2021
Interim Management Statement 2021 1 Review of Business 2 Financial Review 3 Future Prospects Edmond Scanlon, Marguerite Larkin, Chief Executive Officer Chief Financial Officer © Kerry 2021 | 3 |
Slide 4: Strong Growth and Strategic Portfolio Development
Strong Growth and Strategic Portfolio Development Volume Growth Taste & Nutrition Channels Strategic Developments Exceptional growth reflecting → Retail – continued strong volume growth A number of important strategic low prior year comparatives and portfolio developments agreed → Foodservice – good
Slide 5: Taste & Nutrition
Taste & Nutrition Strong growth in retail channel, with good progression across the foodservice channel H1 2021 Revenue €2,939m Trading margin 12.4% → Volume growth of 9.8% reflected exceptional Q2 growth of 18.1% with lower prior year comparatives and good underlying growth → Foodservice channel vo
Slide 6: Taste & Nutrition Business Performance by Region
Taste & Nutrition Business Performance by Region Americas Europe APMEA €1,542m €722m €646m H1: 8.1% H1: 10.7% H1: 14.0% → North America retail delivered strong → Retail delivered very good growth → Retail delivered strong growth led growth – led by Beverage, Snacks led by Meat, Dairy and Snacks by B
Slide 7: Consumer Foods
Consumer Foods Strong volume growth particularly in the second quarter H1 2021 Revenue €674m Trading margin 7.2% → Volume growth of 4.6% led by snacking, meat free ranges & chilled ready meals → Pricing of 0.4% reflective of increases in input costs and market pricing Everyday Fresh → Trading margin
Slide 8: H1 2021 Financial Review
H1 2021 €3.6bn Financial Revenue Review €357m Trading Profit Marguerite Larkin, Chief Financial Officer 152.0c Adjusted EPS © Kerry 2021 | 8 |
Slide 9: H1 2021 Financial Overview
H1 2021 Financial Overview Revenue €3.6bn 9.0% volume growth Trading profit €357m 13.0% reported growth Trading margin 10.0% +70 bps margin expansion 24.1% constant currency growth Adjusted EPS 152.0c 15.1% reported growth Basic EPS 128.2c 6.5% reported growth ROACE 10.0% FY 2020: 9.8% Free cash flo
Slide 10: Group Revenue Analysis
Group Revenue Analysis H1 2020 H1 2021 €3,414m €3,582m 4.9% Volume Volume Translation 3.6% Acquisitions currency 9.0% Transaction (5.4%) Price 0.9% currency (0.1%) 0.5% © Kerry 2021 | 10 |
Slide 11: Group Revenue Breakdown
Group Revenue Breakdown Group Revenue H1 2021 Taste & Nutrition Volume Performance by Channel +9.0% H1 Retail +5.4% H1 Foodservice +25.2% +9.8% €3.6bn 6% 82% €2.9bn 5% 5% 4% 4% +4.6% (1%) (8%) 2% (49%) €0.7bn Group Consumer Taste & Foods Nutrition Q1 Q2 Q3 Q4 Q1 Q2 Q1 Q2 Q3 Q4 Q1 Q2 Reported Revenue
Slide 12: Group Trading Margin Breakdown
Group Trading Margin Breakdown €357m €316m H1 2020 Operating Leverage Net COVID-19 Net Price KerryExcel - Currency Acquisitions H1 2021 / Portfolio Mix Costs / Initiatives Net Efficiencies / Investments Trading 9.3% 1.0% 0.0% 0.0% (0.1%) (0.2%) 0.0% 10.0% Margin © Kerry 2021 | 12 |
Slide 13: Free Cash Flow
Free Cash Flow H1 2021 H1 2020 €m €m Trading profit 357 316 Depreciation (net) 101 101 Movement in average working capital (27) (116) Pension contributions paid less pension expense (6) (4) Cash flow from operations 425 297 Finance costs paid (net) (22) (25) Income taxes paid (32) (36) Purchase of n
Slide 14: Strong Credit Metrics with Long Maturity Profile
Strong Credit Metrics with Long Maturity Profile Maturity Profile of Net Debt Undrawn €1.1bn RCF 2021 2022 2023 2024 2025 2026 2029 Total Net Debt of €2.0bn On demand & up to 1 year < 2 years 2 to 5 years > 5 years (€363m) €630m €968m €746m Strong Credit Metrics H1 2021 H1 2020 Net debt: EBITDA* 1.9
Slide 15: Other Financial Matters
Other Financial Matters Kerryconnect North America deployment continued Finance Costs Decrease of €3m primarily due to lower interest rates Pension Net surplus of €43m Non-trading Items Net charge of €20m primarily due to GBS programme Dividends Interim dividend of 28.5 cent proposed Raw materials L
Slide 16: Outlook and Future Prospects
Outlook and Future Prospects Edmond Scanlon, Chief Executive Officer © Kerry 2021 | 16 |
Slide 17: Strategic Acquisitions
Strategic Acquisitions Strategic Consideration Region Technologies End Use Markets Strategic Fit Acquisition → Complementary portfolio Meat → Food → Supporting industry drive to reduce food waste €853m¹ Protection Bakery → Enhances Kerry’s leadership position in fast → Preservation growing market Gl
Slide 18: Strategic Platform Development in Key Growth Areas
Strategic Platform Development in Key Growth Areas Step Change in Technology Portfolio in Recent Years Enhancing our Industry-Leading Food Protection & Preservation Portfolio 2017 - 2021 UpGrade™ Durafresh™ UC Rochester, MN Continued investment in innovation Building Leading Capability in ProActive
Slide 19: Future Prospects
Future Prospects → Taste & Nutrition: strong growth prospects in the retail channel, with continued recovery in foodservice, underpinned by a very good innovation pipeline and strong customer engagement → Consumer Foods: good growth outlook supported by innovation and the strength of our brands → We
Slide 20: © Kerry 2021 | 20 |
© Kerry 2021 | 20 |
Slide 21: Appendix
KERRY Appendix\\\)\|
Slide 22: Revenue Growth Components H1 2021
Revenue Growth Components H1 2021 Transaction Translation Acquisitions/ Volume Price Currency Currency Disposals Total Taste & Nutrition 9.8% 0.5% (0.1%) (6.3%) 1.1% 5.0% Consumer Foods 4.6% 0.4% (0.2%) (0.5%) – 4.3% Group 9.0% 0.5% (0.1%) (5.4%) 0.9% 4.9% © Kerry 2021 | 22 |
Slide 23: Volume Growth by Region and Channel
Volume Growth by Region and Channel Divisional Breakdown H1 2021 Taste & Nutrition 9.8% Regional Breakdown H1 2021 Consumer Foods 4.6% Americas 8.1% Group 9.0% Europe 10.7% APMEA 14.0% Channel Breakdown H1 2021 Retail 5.4% Foodservice 25.2% © Kerry 2021 | 23 |
Slide 24: H1 2021 Trading Profit by Business
H1 2021 Trading Profit by Business H1 2021 H1 2020 H1 2021 Trading H1 2020 Trading Revenue Profit Revenue Profit €m €m % €m €m % Taste & Nutrition 2,938.6 364.4 12.4% 2,798.6 324.8 11.6% Consumer Foods 674.2 48.6 7.2% 646.6 45.1 7.0% Eliminations/unallocated (30.7) (55.9) - (31.2) (54.0) - Group 3,5
Slide 25: EPS Reconciliation
EPS Reconciliation H1 2021 H1 2020 Growth € cent € cent Basic EPS 6.5% 128.2 120.4 Brand related intangible asset amortization 12.6 11.7 Non-trading items (net of related tax) 11.2 - Adjusted EPS 15.1% 152.0 132.1 Impact of foreign exchange rate translation 9.0% Adjusted EPS growth in constant curre
Slide 26: Exchange Rate Movements
Exchange Rate Movements Average Exchange Rates vs Euro – H1 2021 v H1 2020 7% 2% 0% BRL MXN USD GBP RUB AUD CNY MYR ZAR (1%) (3%) (6%) (10%) (21%) (26%) © Kerry 2021 | 26 |
Slide 27: Net Debt as at 30 June 2021
Net Debt as at 30 June 2021 Debt @ Floating @ Fixed €m Rates Rates €m €m Euro 1,727 (7) 1,734 Sterling 7 7 - US Dollar 611 401 210 Other 31 31 - Gross debt 2,376 432 1,944 Cash (395) (395) - Net debt 1,981 37 1,944 Gross Debt H1 2021 18% 82% Gross Debt H1 2020 30% 70% Weighted Average maturity of de
Slide 28: Kerry
KERRY