Anheuser-Busch InBev SA/NV · EURONEXT:ABI
Anheuser-Busch InBev SA/NV — Interbrew — Investor Day (2004)
38 slides from Anheuser-Busch InBev SA/NV's investor day presentation, 2004
Slide 1: Strategy and Position in Central Europe
Strategy and Position in Central Europe Jaak De Witte
Slide 2: Central Europe: organization chart
Central Europe: organization chart Regional Regional President President Central Europe Central Europe Jaak Jaak De De Witte Witte General General Manager Manager General General Manager Manager VP VP Supply Supply VP VP Demand Demand Hungary Hungary Bulgaria Bulgaria Chris Chris Lemire Lemire Erik
Slide 3: Agenda
Agenda 1. Central Europe – macroeconomics – total beer market 2. Interbrew in Central Europe 3. Interbrew’s way of operating in Central Europe 4. Key challenges in Central Europe 5. Personal conclusion for successful management in Central Europe 3
Slide 4: 1. Central Europe macroeconomics – total beer market
1. Central Europe macroeconomics – total beer market
Slide 5: Central Europe: beer market of 90 Mio hl
Central Europe: beer market of 90 Mio hl 5
Slide 6: Big differences in liter/capita consumption
Big differences in liter/capita consumption <20 l / capita 20 - 40 l / capita 40 - 60 l / capita 60 - 80 l / capita 80 - 100 l / capita 100 - 150 l / capita 150 - 170 l / capita 6
Slide 7: Big differences in size of the markets
Big differences in size of the markets 0 - 1 Mio hl 1 - 2 Mio hl 2 - 6 Mio hl 6 - 10 Mio hl 10 - 15 Mio hl 15 - 20 Mio hl 20 - 25 Mio hl +25 Mio hl 7
Slide 8: Beer market evolution Central European countries
Beer market evolution Central European countries Volume (absolute) Capita consumption (l) % growth 1999 LE2002 2003 1999 LE2002 2003 2003 - 2002 Poland (*) 23.080 25.320 25.800 60 65 67 +1.8% Czech Rep 16.500 16.100 15.900 160 156 154 -1.2% Hungary 6.947 7.160 7.175 70 70 70 - Slovakia (*) 4.570 4.8
Slide 9: Two clusters of development
Two clusters of development Cluster 1: Cluster 2: Mature CE markets Emerging markets EC-members (2004) EC-members (2008 / 2010) Poland - Czech Republic – Hungary – Romania – Bulgaria - Turkey Slovakia - Slovenia (Croatia) - BiH –Serbia- Montenegro – (Croatia) Kosovo – Macedonia Key characteristics K
Slide 10: 2. Interbrew in Central Europe
2. Interbrew in Central Europe
Slide 11: Interbrew in Central Europe
Interbrew in Central Europe 1. Hungary 2. Croatia 3. Romania 4. Bulgaria 5. Serbia-Montenegro 6. Bosnia-Herzegovina 7. Czech Republic 11
Slide 12: Hungary, the start of international expansion
Hungary, the start of international expansion Partnership in 1991 Böcs - Miskolc 1997 2000 2003 Sales / volume 2027 2015 2299 Share 27.6% 29.1% 30.8% Competition SAB 36.9% 29.1% 32.0% Brau AG 21.5% 34,4 {26.7% 32.0 {25.8% Heineken 7% { 7.7% { 6.2% Pecz 7% 7.7% 5.3% 12
Slide 13: Croatia, a success story
Croatia, a success story Partnership in 1994 Zagreb 1997 2000 2003 Sales / volume 1137 1550 1736 Share 32% 41% 44.9% Competition Karlovacko / Heineken 25% 20% 18.3% Tuborg / Pan 11% 11% 9.7% 13
Slide 14: Romania, from green field to number position
Romania, from green field to number 2 position Partnership • Baia Mare in 1994 Baia Mare Blaj • Blaj in 1995 • Ploiesti in 1999 1997 2000 2003 Sales / volume 569 1460 1974 Share 7.7% 12.1% 15.4% Competition BBAG / Heineken 36% 36% 32.2% SAB + Timisoara 13% 14% 15.3% Tuborg - 4% 6.9% 14
Slide 15: Bulgaria: Kamenitza, a winning proposal
Bulgaria: Kamenitza, a winning proposal Partnership Plovdiv in 1995 Haskovo in 1995 Burgas in 1995 Pleven in 1998 Haskovo 1999 2000 2003 Sales / volume 853 1354 1148 Share 27% 34% 27% Competition Heineken(Zagorka) 27% 25% 31% Carlsberg 16% 14% Bulbrew 12% 14% Boliarka 8% 10% 15
Slide 16: Serbia-Montenegro, a difficult start resulting in a strong position
Serbia-Montenegro, a difficult start resulting in a strong position . Apatin Partnership Niksic (1998) Apatin (October 2003) Niksic 1997 2000 2003 Sales / volume 413 598 2865 Share 29% 45% Competition Celarevo (Carlsberg) 12% 9.6% Zajecar 11% 7.1% BIP 10% 11.4% 16 (*) 5 months strike
Slide 17: Bosnia-Herzegovina, a start via a brown-field
Bosnia-Herzegovina, a start via a brown-field Partnership in 1999 Grude (1999) Grude Apatin (2003) 1997 2000 2003 Sales / volume 123 349 Share 7% 18.3% Competition Banja Luka 28% 31% Sarajevo 14% 17% 17
Slide 18: Czech Republic, a challenging turn-around
Czech Republic, a challenging turn-around Partnership in 2000 Prague (2) Ostravar 1999 2000 2002 Sales / volume 2068 2359 (* domestic) Share 12.5% 14.2% Competition SAB 44% 48.3% Budvar 5% 3.8% 18
Slide 19: Superior, Consistent Growth
Superior, Consistent Growth Volume EBITDA Excl. Apatin Mio hl % 16 % G R 24 CA G R CA 94 96 98 2000 2002 94 96 98 2000 2002 19
Slide 20: Superior, Consistent Growth
Superior, Consistent Growth ROIC EBIT / INV. CAP. 2000 2001 2002 2003 20
Slide 21: 3. Interbrew's way of operating
3. Interbrew’s way of operating in Central Europe
Slide 22: Strategy for value / growth creation
Interbrew’s way of operating in Central Europe Strategy for value / growth creation GROWTH VALUE CREATION ORGANIC TRANSACTIONAL GROWTH GROWTH 00 Czech Rep 03 Apatin 22
Slide 23: Strategy for organic value / growth creation in CE
Strategy for organic value / growth creation in CE Happy consumers … happy customers … Happy employees … happy shareholders WINNING & PROFESSIONALISE WINNING BEST & CONSTANT FOCUSED BRAND ROUTE TO AT POINT OF LOWEST COST UPGRADE & PORTFOLIO CUSTOMER CONNECTION PRODUCER / PROFESSIONALISE DELIVERER PE
Slide 24: Winning & focused brand portfolio
Strategy for organic value / growth creation in CE WINNING & FOCUSED BRAND PORTFOLIO •Develop sustainable core domestic brands • Drive global premium & specialty brands • Tactical presence in value segments • Get systematic ‘consumption’ insights ‘ • Right & smart pricing 24
Slide 25: Different routes to customer
Strategy for organic value / growth creation in CE 3 Different routes to customer Type 1: Direct delivery model with strong & growing organised retail (+30%) PROFESSIONALISE -> Czech Republic ROUTE TO CUSTOMER Type 2: Indirect delivery model with strong & growing •Aligned tradeterms over all organis
Slide 26: Winning at point of connection
Strategy for organic value / growth creation in CE WINNING AT POINT OF CONNECTION • Increase sales coverage & effectiveness in on- & off-trade • Develop integrated telesales / telemarketing • More seen … more cold … more sold • cold/warm display • better merchandising standards • Permanent upgrade o
Slide 27: Best & lowest cost producer & deliverer
Strategy for organic value / growth creation in CE BEST & LOWEST COST PRODUCER & DELIVERER • Rationalise footprint – warehouses • Gradually go for world class operating productivity • Procurement saving programs – value engineering • Sharing best practices + permanent benchmarking on all key process
Slide 28: Constant upgrade & professionalise people / systems
Strategy for organic value / growth creation in CE CONSTANT UP- GRADE & PROFESS. PEOPLE / SYSTEMS • Aligned (business) processes over all 7 CE- countries • One common ‘SAP’ / ERP / IT strategy / implementation for all CE-countries • Standard ‘organisation’ & people reviews with performance appraisal
Slide 29: Leadership in innovation
Strategy for organic value / growth creation in CE LEADERSHIP IN INNOVATION New target New New liquids New moments groups packaging ‘ New New New systems occasions processes 29
Slide 30: Strategy for organic value / growth creation in CE
Strategy for organic value / growth creation in CE Happy consumers … happy customers … Happy employees … happy shareholders WINNING & PROFESSIONALISE WINNING BEST & CONSTANT FOCUSED BRAND ROUTE TO AT POINT OF LOWEST COST UPGRADE & PORTFOLIO CUSTOMER CONNECTION PRODUCER / PROFESSIONALISE DELIVERER PE
Slide 31: 4. Key challenges
4. Key challenges in Central Europe
Slide 32: Key challenges: excise tax levels
Key challenges in Central Europe Very high excise tax levels that are still growing Governments take bigger piece out of value chain % NNS 2002 2004 2007 2007 Bosnia 10,2 10,2 10,2 15,5% Bulgaria €/ hl 5,6 5,6 8,7 16,8% Croatia Kn/ hl 200 200 200 37,2% Czech Rep Cz/ hl 240 240 240 16,6% Hungary Huf/
Slide 33: Key challenges in Central Europe
Key challenges in Central Europe EU accession of new & future potential member states + - protection of free market competition – counter grey economy - production of creditors / property rights & fulfilment of contracts - re-inforce legal system - stability in economical policy - - environmental ob
Slide 34: 5. Personal conclusion for successful management
5. Personal conclusion for successful management in Central Europe
Slide 35: Personal conclusion for successful management
Personal conclusion for successful management in Central Europe Constantly listen to “local consumers” and “local customers” / understand their “changing” needs Constant use of “benchmarking” in all processes 35
Slide 36: Personal conclusion for successful management
Personal conclusion for successful management in Central Europe Share best practices at the right moment Shared thinking with colleagues : Avoid “re-invented” wheels Be the best and the first “locally” 36
Slide 37: Personal conclusion for successful management
Personal conclusion for successful management in Central Europe Evolution (not revolution) to Western professional standards Build a strong local management team • Individual - team development plans • Constant coaching/support in all departments by Interbrew specialists 37
Slide 38: Personal conclusion for successful management
Personal conclusion for successful management in Central Europe Keep “consumers - customers” constantly happy 38