Coca-cola Bottlers Japan Holdings Inc. · TSE:2579
Coca-cola Bottlers Japan — FY2020 Earnings Presentation
42 slides from Coca-cola Bottlers Japan's earnings presentation, Feb 12, 2021
Slide 1: Full-year 2020 Earnings Presentation
Full-year 2020 Earnings Presentation February 12, 2021 Coca-Cola Bottlers Japan Holdings Inc. Calin Dragan, President Bjorn Ulgenes, Vice President & Chief Financial Officer (Posted to CCBJH website on February 10, 2021)
Slide 2: Forward-looking statements
Forward-looking statements The plans, performance forecasts, and strategies appearing in this material are based on the assumptions and judgment of the management of Coca-Cola Bottlers Japan Holdings Inc. (CCBJH or Company) in view of data obtained as of the date this material was released. These fo
Slide 3: Full-year 2020 earnings presentation agenda
Coca-Cola Bottlers Japan Holdings Inc. (CCBJH) Full-year 2020 earnings presentation Overview and situational analysis Full-year results and 2021 outlook Q&A 3
Slide 4: Overview and Situational Analysis
Overview and Situational Analysis
Slide 5: Business as usual is not an option
“Business as usual is not an option” - Our focus areas during uncertain times - SAFETY & SECURITY AGILITY RESILIENCE The safety and security of Agile and flexible business Accelerating transformation our consumers, customers, planning, ready for the to build a resilient partners, employees and futur
Slide 6: 2020 Highlights
2020 Highlights Business Income ahead of plan; Building agile & flexible foundation for the future Business Income ahead of Grow & recover market share Transformation plan •Continued momentum on vending •Vending/sales route transformation •Flat Business Income despite 100 value share growth and reco
Slide 7: 2020 Highlights (Continued)
2020 Highlights (Continued) Business Income ahead of plan; Building agile & flexible foundation for the future Growth initiatives Supply capacity expansion Good stewardship of capital •Focus on innovative products & •Completion of major manufacturing •Focus on core business; Divestment packages to m
Slide 8: Focusing on what's in our control
Focusing on what’s in our control 2020 situation Delivering results in a tough year • 100B yen revenue decline vs. PY ✓ 2020 Business Income 4B yen better than plan • Rapid consumer behavior shift ✓ Accelerated transformation of cost structure, amid COVID-19 organization, people, processes and syste
Slide 9: White space expansion – Success in ready-to-drink alcohol
White space expansion – Success in ready-to-drink alcohol Lemon-dou sales volume reached ~7.9 million cases in 2020, well ahead of plan Launched dry taste “Kamisori Lemon” in December 2020. Now offering 5 SKUs “Teiban Lemon” won #1 market share in 350ml lemon sour category in 2020 Market share sourc
Slide 10: Agile and flexible supply infrastructure
Agile and flexible supply infrastructure CCBJI supply chain footprint Seven new manufacturing lines up and running since 2019. 20% additional aseptic production 2 2 lines lines capacity vs. 2018 to meet consumer demand 1 Expanding in-house alcohol production capacity as line category continues to gr
Slide 11: Full-year 2020 results
Full-year 2020 results y,
Slide 12: Full-year 2020 results vs. 2019
Full-year 2020 results vs. 2019 Business Income better than revised plan driven by significant cost savings. Operating income improved versus prior year, cycling one-time expenses. Divesting health and skincare business, now treated as discontinued operations. 2020 Actual 2020 Revised plan 2019 Actu
Slide 13: Full-year 2020 Drivers of Business Income
Full-year 2020 Drivers of Business Income Topline pressure offset by significant cost savings and transformation; Flat Business Income Volume, Price DME Commodity Manufacturing Others & Mix* (Direct Marketing Expense, fixed only) 11.4 -45.3 (Full-year) 0.2 Full-year 2019 Q3 -14.5 • Reduced • Cost re
Slide 14: Full-year 2020 NARTD beverage performance
Full-year 2020 NARTD beverage performance Growth in D&D, Online channels; Package mix and case size impacting revenue per case By channel Wholesale Vs. PY Volume revenue Winning where the growth is 1% per case Capturing bulk purchase demand Supermarket (SM) +1% -54Yen Online channel volume growth ov
Slide 15: Full-year 2020 NARTD category volume performance
Full-year 2020 our NARTD category volume performance Continued, but moderating impact from COVID-19 Sparkling driven by decline in R&F and VM, partly offset by Coca-Cola Zero renewal, launch of Fanta By category Premier series Vs. PY Volume NST decline driven by CVS, R&F and VM. Slight decline in 8%
Slide 16: NARTD channel/category/package volume performance
NARTD channel/category/package volume performance Q4 2020 (Oct. to Dec.) volume: -6% By package By channel Wholesale Full-year 2020 Vs. PY Volume revenue vs PY Volume 1% per case 2% S-PET -10% Supermarket (SM) +8% -108 Yen 7% 20% L-PET +6% 25% Drug & Discounter (D&D) +11% -90 Yen 10% 5% 39% Can -16%
Slide 17: Building a foundation for value growth in 2021
Building a foundation for value growth in 2021 Recovery in OTC value share, vending share growth momentum continues OTC – Back to growth from December Vending – Share growth momentum continues • Q4 OTC value share getting back to 2019 levels, • 21 consecutive months of value share growth since April
Slide 18: Over 35B yen cost savings in 2020
Accelerated transformation and mitigating actions deliver over 35B cost savings in 2020 Transformation • Vending operational model • OTC sales route Supply chain recovery and expansion, normalizing logistics and distribution Over • New aseptic manufacturing lines, Hiroshima plant Labor 35B yen • Bon
Slide 19: Continued priority on good stewardship of capital
Continued priority on good stewardship of capital Focus on shareholder value creation and appropriate cash position given macro uncertainty Shareholder value creation Balance sheet and Dividends Capex and depreciation cash flow 2020 - Solid financial position: JCR 2020 No change to reinstated year-e
Slide 20: Marketing and branding update
Marketing and branding update
Slide 21: Update from Coca-Cola (Japan) Company
Update from Coca-Cola (Japan) Company 2020 Q4 Initiatives Highlight 2021 Q1 Business Plan 21
Slide 22: 2020 Q4 Initiatives Highlight
2020 Q4 Initiatives Highlight: Georgia Coca-Cola Zero Sugar Cross Category “Try Your Luck” Promotion Full Renewal Winter Campaign 1.5MM applicants Achieved new users 1.1MM applicants Contributing to Georgia share growth and high repeat rate Coke ON Lemon-dou 1st Anniversary Coca-Cola New Year Countd
Slide 23: ILOHAS Green Purchasing Network Award Grand Prize
Accelerating Sustainability: ILOHAS “Green Purchasing Network Award” Grand Prize 23
Slide 24: 2021 Q1 Business Plan (January)
2021 Q1 Business Plan (January) Coca-Cola Georgia x Gundam Aquarius “Mamoru” “Open to Happiness” Campaign Campaign Lactobacillus Water Pop Girls Group NiziU Georgia share gain 10 billion “Shield Lactobacillus” Support the precious moments Hot topic on SNS per bottle of new normal Support health of f
Slide 25: 2021 Q1 Business Plan (February to March)
2021 Q1 Business Plan (February to March) Ayataka “Traditional Crafts Donation Karada Odayakacha W Fanta Premier Renewal Bottle” Japan’s first ever Help support young Further strengthen the Functional beverage with double craftspeople by donating a “Premium Sparkling” benefit on memory and blood por
Slide 26: 2021 Business Plan: Continue flexible and timely actions
2021 Business Plan: Continue flexible and timely actions to adapt to changes FEWER, BIGGER STAY@ HOME PIVOT TO CORE INNOVATIONS コアへの原点回帰 家庭内需要の獲得 選択と集中 26
Slide 27: 2021 Direction / Outlook
2021 Direction / Outlook f Wit
Slide 28: Strong uncertainties due to resurgence of COVID-19
Strong uncertainties due to resurgence of COVID-19 & 2nd State of Emergency Traffic movement has declined due to SoE, but better Macro economy than 2020 • GDP down -5.1% in 2020 and Number of new coronavirus cases (per day) recuperating +3.1% in 2021 • “After COVID-19” moderate growth Source: IMF Wo
Slide 29: Strong uncertainties in 2021 triggered by 2nd state of emergency
Strong uncertainties in 2021 triggered by 2nd state of emergency Easing Resur- 2nd Pre-Crisis 1st SoE restrictions gence SoE CCBJI NARTD volume YoY (Jan. 2020 to Jan. 2021) 1 2 3 4 5 6 7 8 9 10 11 12 1 • Prolonged COVID-19 impact, though gradually improving volume trend through end of 2020 • Continu
Slide 30: 2021 Outlook
2021 Outlook Unable to provide 2021 guidance now in light of renewed COVID-19 uncertainties. Focus on what we can control; Agile & flexible business planning based on multiple scenarios as situation evolves Product portfolio and Commercial Initiatives Transformation innovation •Revenue recovery and
Slide 31: Focusing more on ROI
Commercial initiatives to drive revenue recovery Revenue recovery Value share growth Focusing more on ROI Focus on where growth is Vending Disciplined investment Growing channel/categories Maximize transaction and quality Selective sales promotion Core and big bets products placement Equipment place
Slide 32: Agile adaption to New normal
Agile adaption to “New normal” Driving initiatives to capture consumers’ behavior change Launching label less SKUs and Expand 350/700ml PET offerings Market execution responding Cross-channel promotion by new package configuration, in supermarket and drug & Coke ON smartphone app to discounter chann
Slide 33: Ongoing transformation across our supply network
Ongoing transformation across our supply network End-to-end transformation; from supply chain to field operations • Transform warehouse operations • Optimize sales centers as new logistic/distribution infrastructure is up and running • Digitalize planning and field operations • Further accelerating
Slide 34: ESG – More important than ever
ESG – More important than ever Steady progress toward WWW (World Without Waste) goals to create shared value 2020 achievement Inclusion in leading market indices Usage of recycled PET and plant-based PET: 33% Launch of iLohas 555ml with 100% recycled PET resin Selective launch on Ayataka 525ml with
Slide 35: Creating shared value
Creating shared value Updated our CSV goals to raise management diversity and inclusion target 20% Female managers by 2030 35
Slide 36: 2021 Outlook KPIs
2021 Outlook KPIs Shift from “Resilience” to “Recovery toward Growth”. Market share Recurring cost savings Annual dividends 7 to 9 50 Bil. Yen Yen/Share Recurring cost savings Value share growth to target through Return to stable dividend drive revenue recovery transformation Capex Depreciation Cont
Slide 37: In closing
In closing Sustainable growth, creating shared value Good Win in the Continue stewardship of market place transformation capital 37
Slide 38: Bottlers Japan Holdings Inc.
BOTTLERS JAPAN HOLDINGS INC.
Slide 39: Appendix
Appendix BOTTLERS JAPAN HOLDINGS INC.
Slide 40: We are part of the global Coca-Cola system
We are part of the global Coca-Cola system An enduring and effective partnership Coca-Cola (Japan) Company • Brands • Customer focus • Innovation • Local expertise • Global perspective • Best-in-class execution • Consumer focus • Finished goods production • Superior insight • Logistics and distribut
Slide 41: Glossary of key terms
Glossary of key terms Business A measure of our underlying or recurring business performance after the adoption of IFRS. Business Income deducts cost of goods and SG&A from revenue, and Income includes other income and expenses which we believe are recurring in nature. DME Abbreviation of Direct Mar
Slide 42: Thank you
THANK YOU Investor Relations Coca-Cola Bottlers Japan Holdings Inc. ir@ccbji.co.jp https://en.ccbj-holdings.com/ir/ facebook: https://www.facebook.com/ccbji/
Coca Cola Bottlers Japan — FY2020 Earnings Presentation on 6ix