Anadolu Efes Biracilik Ve Malt Sanayii A.s. · BIST:AEFES
Anadolu Efes Biracilik Ve Malt Sanayii A.s — Anadolu Efes — Q1 2020 Earnings Presentation
22 slides from Anadolu Efes Biracilik Ve Malt Sanayii A.s's earnings presentation, May 7, 2020
Slide 1: 1Q2020 Conference Call Presentation
1Q2020 CONFERENCE CALL PRESENTATION 07.05.2020
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation may contain certain forward-looking statements concerning our future performance and should be considered as good faith estimates made by the Company. These forward-looking statements reflect management expectations and are based upon currently available
Slide 3: General Overview & Operating Environment
GENERAL OVERVIEW & OPERATING ENVIRONMENT APPENDIX Can Çaka CEO & Beer Group President
Slide 4: Robust performance until the outbreak impacted in March
Robust performance until the outbreak… A strong start to the year… ... impacted by the outbreak in March … 13% volume growth as of February Quarantines & lockdowns Sell-out numbers exceeding sell-in On-trade ban in all operations Market share gains Social distancing; no gatherings & events Stepped u
Slide 5: We are better together
We are better together… People Business Communities Protect our People Sustain our Business Support our Communities 4
Slide 6: Revisit all touchpoints to ensure safety and business continuity
Revisit all touchpoints to ensure safety and ... Health, Safety & •Switched to remote working practices across all operations, wherever possible Working •All measures taken according to pandemic plan and government instructions in breweries Conditions •Remote working for sales teams where possible w
Slide 7: Business continuity throughout 2020
... business continuity throughout 2020 •On-trade closed across all countries; varying impact on country operations •Share of on-trade in Turkey is ~25%, in Russia is low to mid single digit & in other EBI countries high single digit Business •Low volumes expected during Ramadan (1 week of April + 3
Slide 8: Supporting our communities
Supporting our communities Georgia: Turkey: Support total of 500 barmen's and waiters who lost their In cooperation with Ahbap Association shopping jobs due to closure of on trade outlets cards to be provided to +7000 impacted employees and their families to support Supply disinfection liquids for I
Slide 9: Anadolu Efes 1Q Financial Highlights
Anadolu Efes 1Q Financial Highlights VOLUMES Strong volume growth achieved in International Beer & Soft Drinks 1Q Turkey beer under pressure starting from mid-March +3.7% REVENUE Higher prices per hl 1Q Positive currency translation +15.3% EBITDA (Margin) 1Q Margin decline mainly driven by
Slide 10: Beer volume growth driven by international and compensating softer volumes in Turkey
Beer volume growth driven by international and compensating softer volumes in Turkey… BEER GROUP SALES VOLUME VOLUME BREAKDOWN* BY COUNTRY Kazakhstan Other Turkey 6% 4% 11% 6.7 7.0 Ukraine 15% mhl 5.8 6.2 0.9 0.7 Russia 1Q2019 1Q2020 64% Turkey International *Breakdown on combined basis Turkey Opera
Slide 11: Another quarter with robust volume growth for soft drinks
Another quarter with robust volume growth for soft drinks … SOFT DRINKS SALES VOLUME VOLUME BREAKDOWN* BY COUNTRY Others Azerbaijan 230 239 Iraq 4% 3% 8% m u/c Kazakhstan Turkey 124 132 16% 45% 106 107 Pakistan 1Q2019 1Q2020 24% Turkey International *Breakdown on combined basis Turkey Operations Int
Slide 12: Financial Overview
FINANCIAL OVERVIEW APPENDIX N. Orhun Köstem Chief Financial Officer
Slide 13: Balance Sheet & Risk Management
Balance Sheet & Risk Management •Current cash balances •No long term • High hedge coverage •Beer Group Net Debt / refinancing needs in Risk Management Debt Management Cash Management Liquidity & Leverage cover short term for short term FX 2020 EBITDA ratio 2.0x exposure financial debt •More than 90%
Slide 14: Beer profitability impacted by pricing & calendarization of OPEX
Beer profitability impacted pricing & calendarization of OPEX ANADOLU EFES4,514 BEER GROUP TURKEY BEER EBI 3,913 15% Net Sales 1,740 9% 1,892 1,571 -17% 1,357 16% 374 312 1Q2019 Restated 1Q2020 1Q2019 1Q2020 1Q2019 1Q2020 1Q2019 1Q2020 Margin: 31.0% 29.9% 30.0% 27.0% 49.4% 41.6% 23.9% 23.4% Gross Pr
Slide 15: Beer Group EBITDA Drop in the Smallest Quarter
Beer Group EBITDA Drop in the Smallest Quarter No price increase and volume decline in Turkey Excise tax and average pricing in Russia Higher S&D spend in Russia driven by higher volumes Higher marketing spend in Turkey * Cost inflation FX hedge differential 72.6 -42.6 Digital infrastructure and IT
Slide 16: Beer Group FCF Breakdown
Beer Group FCF Breakdown • Drop in Beer Group FCF compared to last year is due to; • Lower EBITDA in absolute terms • Increase in working capital • Despite significant improvement in Turkey • Especially in Russia driven by the payables performance, to be normalized rest of the year -168.4 -7.5 -923.
Slide 17: Closing Remarks
CLOSING REMARKS APPENDIX Can Çaka CEO & Beer Group President
Slide 18: 2020 Beer Group Outlook
2020 Beer Group Outlook • Given the uncertainties, 2020 guidance withdrawn • Second quarter results critical to give a more concrete and detailed guidance Decline by low- EBITDA margin Will not exceed double digits contraction in FY previous year’s on annual basis to be less than 1Q level EBITDA Cap
Slide 19: Manage through potential risks ahead
Manage through potential risks ahead ... Increase in working capital need & Deterioration in indebtedness consumers Economic recession confidence & and increase in decrease in Extended quarantines & unemployment household spend lock down decisions & on- Duration of trade ban pandemic 19
Slide 20: And adapt to new normal
... And adapt to new normal Post Crisis Recovery & Crisis Adaptation • Leverage learnings to adapt to new normal Management • Reassess brand & SKU strategy • Scenario planning • Reconfigure procurement & supply chain • Revised demand & production planning • Zero based OPEX & Capex spend Initial • Al
Slide 21: Q&A Session
Q&A SESSION APPENDIX Can Çaka CEO & Beer Group President N. Orhun Köstem Chief Financial Officer
Slide 22: FX Rates
FX Rates 1Q2019 1Q2020 Δ% AVG 5.36 6.09 13.6% USD/TL PE 5.63 6.52 15.8% AVG 6.09 6.72 10.3% EUR/TL PE 6.32 7.22 14.2% AVG 12.33 10.90 -11.6% TL/RUB PE 11.50 11.93 3.7% AVG 70.50 64.18 -9.0% TL/KZT PE 67.52 68.76 1.8% AVG 5.09 4.11 -19.2% TL/UAH PE 4.84 4.31 -11.0% AVG 3.20 2.89 -9.7% TL/MDL PE 3.08