Big Rock Brewery Inc. · TSX:BR
Big Rock Brewery — Shareholder Meeting (May 2017)
25 slides from Big Rock Brewery's shareholder meeting presentation, May 11, 2017
Slide 1: Annual Meeting of Shareholders Management Presentation
Annual Meeting of Shareholders Management Presentation May 11, 2017 TSX:BR
Slide 2: Cautionary Statement
Cautionary Statement Caution Regarding Forward-Looking Statements Certain statements contained in this presentation constitute forward-looking statements. These statements relate to future events or Big Rock’s future performance. All statements, other than statements of historical fact, may be forwa
Slide 3: Key Accomplishments
Key Accomplishments ➢ Commissioning of the Ontario brewery in Etobicoke ➢ Opening of Liberty Commons brewpub restaurant in Toronto ➢ Renegotiation of credit facilities ➢ Sale of unused land in Calgary ➢ Rebranding and packaging redesign TSX:BR 3
Slide 4: Key Challenges
Key Challenges ➢Government policy ➢The continued flight to lower priced beer – particularly in Alberta ➢Sustained, intense competition TSX:BR 4
Slide 5: Strategic Differentiator
Strategic Differentiator CONSUMER ➢ Three components of strategic Consumer value creation: Intimacy – Cost / Operational Efficiency – Consumer Intimacy AREAS OF STRATEGIC – Product leadership / FOCUS * Innovation COST PRODUCT ➢ All three are important, but only one can be the Operational Product ove
Slide 6: Big Rock – Yesterday and Today
Big Rock – Yesterday and Today 2009-2011 – MACRO “BIG BEER” ➢ Few product lines ➢ Focus on cost, efficiency, volume ➢ Centralized, highly efficient production COST CONSUMER PRODUCT 2012-2014 – MICRO ➢ Experiment with trends – ‘bleeding edge’ ➢ Emphasize creativity & constant innovation COST CONSUMER
Slide 7: Target Segment – “Taste Seeker”
Target Segment – “Taste Seeker” TSX:BR 7
Slide 8: Consumers drink across categories & preferences are changing…
Consumers drink across categories & preferences are changing… Big Rock is well-positioned ... TSX:BR 8
Slide 9: Big Rock Today
Big Rock Today ➢ Multi-province footprint – Alberta – Ontario – British Columbia ➢ Consumer-driven – Building brand awareness – Acting on consumer feedback ➢ Focused on improving profitability ➢ Positioned for profitable growth ➢ Product innovation and industry leadership – Three brewmasters, three
Slide 10: Multi-Province Footprint
Multi-Province Footprint Calgary ➢ Main brewery ➢ Restaurant – Big Rock Grill Toronto ➢ Regional brewery Vancouver ➢ Restaurant – Liberty Commons ➢ Regional brewery ➢ Restaurant – Big Rock Urban Eatery TSX:BR 10
Slide 11: Consumer Driven
Consumer Driven ➢ Building brand awareness – National rebrand – Beer awards – Folk music festivals – Brewery as a destination – Random acts of Big Rock – Strut your stuff campaign ➢ Acting on consumer feedback – Social media and website debates and surveys TSX:BR 11
Slide 12: Focused on Improving Profitability
Focused on Improving Profitability ➢ Continue to grow sales volumes ➢ Increase profit margins ➢ Reduce operating costs ➢ Increase brewery efficiencies TSX:BR 12
Slide 13: Positioned for Profitable Growth
Positioned for Profitable Growth % of Hectolitres Production 2016 production (hl) 199,454 Spare capacity (hl) 53,346 Current capacity (hl) 252,800 126.75% Potential additions (hl) 187,200 Potential capacity (hl) 440,000 220.60% Cap Ex required ($000s) $ 4,070 Incremental cost per hl $ 21.74 TSX:BR 1
Slide 14: Product Innovation and Industry Leadership
Product Innovation and Industry Leadership ➢ Alberta Brewmaster Paul Gautreau – Nano and pilot breweries – Barrel beer – Custom built sour room – Alberta Unity Brew event ➢ British Columbia Brewmaster Jody Hammell – Pilot brewery – Bee hives – Citradelic ➢ Ontario Brewmaster Connor K. Patrick – Rest
Slide 15: Financial Update
© BiG ROCK BiG ROCK TSX:BR BREWERY
Slide 16: Annual Results – Sales Volumes
Annual Results – Sales Volumes 200,000 8.9% 150,000 Hectolitres 100,000 199,454 168,268 181,857 50,000 - 2014 2015 2016 TSX:BR 16
Slide 17: Annual Financial Results – Operating Profit (Loss)
Annual Financial Results – Operating Profit (Loss) Net Revenue 45 $43.1 $39.6 $0.5 $36.8 $0.4 $5.7 $0.3 $5.2 35 $4.5 $12.6 Depreciation & amortization $13.2 25 $12.3 $ Millions General & administrative Selling expenses 15 Cost of sales $24.5 Operating profit (loss) $18.9 $21.8 5 $0.7 $(1.0) $(0.3) -
Slide 18: Annual Financial Results – Net Income (Loss)
Annual Financial Results – Net Income (Loss) 2014 $(36) $(198) $325 $000s $715 $715 $624 Operating Finance Other Income tax Net income profit (loss) expense expenses expense (loss) (income) (income) (recovery) 2016 $(266) -$266 $(453) $ 000s $(39) $349 $(123) Operating Finance Other Income tax Net i
Slide 19: Annual Financial Results – Cash Flow
Annual Financial Results – Cash Flow 2014 $000s $(5,331) $7,500 $2,317 $(3,002) $1,484 Cash - Operating 2015 Financing Investing Cash - Opening activities activities activities Closing balance balance $3,761 $000s $(6,808) $2,103 $1,484 $540 2016 Cash - Operating Financing Investing Cash - Opening a
Slide 20: First Quarter Results – Sales Volumes
First Quarter Results – Sales Volumes 50,000 4.3% 40,000 Hectolitres 30,000 20,000 41,700 43,477 10,000 - Q1 2016 Q1 2017 TSX:BR 20
Slide 21: 1st Quarter Financial Results – Operating Loss
1st Quarter Financial Results – Operating Loss Net Revenue 10,000 $9,589 $8,901 $119 $170 $1,367 8,000 $1,510 Operating loss $ 000s $3,295 6,000 Depreciation & amortization $3,017 General & administrative 4,000 Selling expenses $5,965 Cost of sales 2,000 $5,322 - $(1,118) $(1,157) -2,000 Q1 2016 Q1
Slide 22: 1st Quarter Financial Results – Net Income (Loss)
1st Quarter Financial Results – Net Income (Loss) Q1 2016 $(783) $(1,118) -$1,118 $000s $(314) $57 $(198) Q1 2017 Operating Finance Other Income tax Net loss loss expense expenses expense (income) (income) (recovery) $(907) $ 000s $(1,157) -$1,157 $93 $(330) $(13) Operating Finance Other Income tax
Slide 23: 1st Quarter Financial Results – Cash Flow
1st Quarter Financial Results – Cash Flow Q1 2016 $000s $1,068 $(5,331) $434 $540 $556 Cash - Operating Financing Investing Cash - end beginning of activities activities activities of period period Q1 2017 $(455) $306 $000s $207 $1,782 $(1.228) Cash - Operating Financing Investing Cash - end beginni
Slide 24: Positioned for Success
Positioned for Success ➢ Major capital expenditures are behind us ➢ Renegotiated credit facilities with improved terms ➢ Land sale closed in Q2, balance of the funds in Q4 ➢ Continued focus on improved margins – Top line: product mix focus on Signature Series – Expenses: ongoing operational efficien
Slide 25: Questions?
TSX:BR Questions? TSX:BR