Scandinavian Tobacco Group A/s · OMXCOP:STG
Scandinavian Tobacco Group A/s — Q1 2024 Earnings Presentation
23 slides from Scandinavian Tobacco Group A/s's earnings presentation, May 3, 2024
Slide 1: Creating Moments of Enjoyment
CREATING MOMENTS OF ENJOYMENT Investor Presentation | First Quarter 2024 Results | 2 May 2024
Slide 2: A Global Leader in Cigars
A GLOBAL LEADER IN CIGARS CORPORATE SUMMARY* • 200 LEADING BRANDS, 11 PRODUCTION SITES • NO. 1 HANDMADE CIGAR PLAYER IN USA Market cap Share price Shares Outstanding • NO. 1 MACHINE-ROLLED CIGAR PLAYER IN EUROPE DKK 9.8 billion DKK 113 83.8 million • ALMOST 1 MILLION ONLINE CUSTOMERS IN USA Major Sh
Slide 3: Agenda
AGENDA Q1 2024 Highlights Niels Frederiksen, CEO Update on Strategy and Key Events Niels Frederiksen, CEO NIELS FREDERIKSEN MARIANNE RØRSLEV BOCK Chief Executive Officer Chief Financial Officer Our Commercial Divisions Marianne Rørslev Bock, CFO Group Financials Marianne Rørslev Bock, CFO Outlook &
Slide 4: Q1 2024 Highlights
Q1 2024 HIGHLIGHTS • Slow start to the year Q1 2024 Q1 2023 • Next Generation Oral doubles net sales and handmade cigars growing by 4%. Net Sales Growth -0.7% 1.3% • Machine-rolled cigars deliver -15% organic net sales decline. EBITDA margin before special items 17.2% 24.1% • Growth Enablers account
Slide 5: Strategy Update
STRATEGY UPDATE
Slide 6: One Commercial Organisation with Strong Category Focus
ONE COMMERCIAL ORGANISATION WITH STRONG CATEGORY FOCUS Q1 2024 Share of Group Organic Growth net sales Handmade cigars 37% 4% MRC and Smoking Tobacco 46% -12% Next Generation Oral 5% >100% Other 12% -3% Group 100% -2%
Slide 7: Growth Enablers Gaining Momentum
GROWTH ENABLERS GAINING MOMENTUM Double-digit 3 new Cigars growth in International XQS Launch in international Super Stores the UK 1 May sales of to open in handmade 2024 cigars 6
Slide 8: Machine Rolled Cigars Europe
MACHINE ROLLED CIGARS EUROPE STG Key MRC markets – total volumes • Total Market Decline -5.1% in Q1 2024 1200000 -2.8% 33% -2.9% -2.7% -3.2% -4.8% -1.6% • Q1 traditionally a small quarter -4.2% -2.6% 32% 1000000 -5.1% • Decline rates have been in the range from -2% to 31% 800000 -5% in recent years
Slide 9: Divisional Performance
DIVISIONAL PERFORMANCE
Slide 10: Europe Branded
EUROPE BRANDED NET SALES 800 10% Q1 2024 Highlights 550 5% • Negative organic net sales growth driven by machine-rolled cigars and smoking tobacco. 300 0% • Handmade cigars and NGO delivered strong growth. 50 -5% • Our market share decreased to 28.1% with the total market decline accelerating to -5%
Slide 11: North America Branded & RoW
NORTH AMERICA BRANDED & ROW NET SALES 1,000 0% 750 Q1 2024 Highlights 500 -5% • Organic net sales was negative by 6% driven by machine-rolled cigars, primarily in Canada. Volume decline in US handmade cigars was offset by pricing. 250 • International sales of handmade cigars deliver sound growth, wh
Slide 12: North America Online & Retail
NORTH AMERICA ONLINE & RETAIL NET SALES 1000 10% 750 Q1 2024 Highlights 8% 500 • Organic net sales growth was 9% driven by the retail stores and distribution of third-party products. 5% The online business deliver stable volumes of handmade cigars with positive price/mix impact. 250 3% • Our Retail
Slide 13: Group Financials
GROUP FINANCIALS
Slide 14: Long Term Trend - EBITDA Margins Q1 2018-Q1 2024
LONG TERM TREND - EBITDA MARGINS Q1 2018-Q1 2024 THE GROUP % % NAOR 30 20 25 15 20 15 10 10 5 5 0 0 Q1 18 Q1 19 Q1 20 Q1 21 Q1 22 Q1 23 Q1 24 Q1 18 Q1 19 Q1 20 Q1 21 Q1 22 Q1 23 Q1 24 NABROW EUROPE BRANDED % % 50 30 25 40 20 30 15 20 10 10 5 0 0 Q1 18 Q1 19 Q1 20 Q1 21 Q1 22 Q1 23 Q1 24 Q1 18 Q1 19
Slide 15: Q1 2024 Results
Q1 2024 Q1 2023 Q1 2023 RESULTS Organic net sales growth -2.1% -0.8% DKK million Q1 2024 Q1 2023 FY 2023 FY 2022 Gross margin 45.2% 49.9 % Net sales 1,948 1,963 8,731 8,762 Gross profit (before special items) 881 979 4,204 4,307 OPEX ratio 28.2% 25.8% OPEX -550 -506 -2,111 -2,037 EBITDA before speci
Slide 16: Net Debt and Leverage
NET DEBT AND LEVERAGE NIBD AND LEVERAGE • Net Interest-bearing Debt (NIBD) increased by DKK 423 5,000 3.5 4,480 million to DKK 4,480 million versus year-end 2023. 4,416 4,057 4,000 3.0 The development is primarily explained by changes in 3,629 • 3,274 3,266 working capital and capital allocations (s
Slide 17: Outlook and Guidance 2024
OUTLOOK AND GUIDANCE 2024
Slide 18: Outlook
OUTLOOK With Rolling towards 2025 and beyond we aim to build a larger and more profitable company • Core categories to deliver flat low single digit annual net sales growth • Growth enablers to deliver double digit annual net sales growth • Acquisitions remain a key pillar of our strategy • We adapt
Slide 19: Maintaining 2024 Guidance
MAINTAINING 2024 GUIDANCE* NET SALES EBITDA MARGIN FREE CASH FLOW ADJUSTED EPS Before special items Before acquisitions In the range of In the range of In the range of In the range of DKK 8.8–9.1 billion 22.0%-24.0% DKK 0.8-1.0 billion DKK 12.5-14.5 • Second Quarter: Expected growth in net sales and
Slide 20: Questions and Answers
FIND OUT MORE QUESTIONS AND ANSWERS Annual Report 2023 Our 2023 Annual Report addresses our financial performance, strategic execution and other important aspects of our business operations. We are happy to take any questions from the audience now. Visit our investor site at: www.st-group.com/invest
Slide 21: 2024 Event Calendar & Contact
2024 EVENT CALENDAR & CONTACT JAN-MAR APR-JUN SEPTEMBER JUL-SEP SEPTEMBER OCT-DEC 5 March 2024 4 April 2024 22 AUG 2024 12 NOV 2024 Full year/Q4 2023 results Annual General Meeting H1/Q2 interim report Q3 interim report 2 MAY 2024 Q1 interim report Torben Sand Eliza Dabbagh Scandinavian Tobacco Grou
Slide 22: Long Term Trend - EBITDA Margins (FY 2018-FY 2023)
LONG TERM TREND - EBITDA MARGINS (FY 2018-FY 2023) THE GROUP % % NAOR 30 25 25 20 20 15 15 10 10 5 5 0 0 FY 18 FY 19 FY 20 FY 21 FY 22 FY 23 FY 18 FY 19 FY 20 FY 21 FY 22 FY 23 NABROW EUROPE BRANDED % % 50 30 25 40 20 30 15 20 10 10 5 0 0 FY 18 FY 19 FY 20 FY 21 FY 22 FY 23 FY 18 FY 19 FY 20 FY 21 F
Slide 23: Thank You
SCANDINAVIAN TOBACCO GROUP THANK YOU
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