Barry Callebaut Ag · SIX:BARN
Barry Callebaut — HY 2018/19 Earnings Presentation
30 slides from Barry Callebaut's earnings presentation, Apr 11, 2019
Slide 1: Half-Year Results 2018/19
Half-Year Results 2018/19 ANALYST & MEDIA CONFERENCE APRIL 11, 2019
Slide 2: Cautionary note
Cautionary note Certain statements in this presentation regarding the business of Barry Callebaut are of a forward-looking nature and are therefore based on management’s current assumptions about future developments. Such forward-looking statements are intended to be identified by words such as “bel
Slide 3: Agenda
AGENDA Highlights HY 2018/19 Antoine de Saint-Affrique, CEO Financial Review HY 2018/19 Remco Steenbergen, CFO Strategy & Outlook Antoine de Saint-Affrique, CEO Questions & Answers CEO and CFO 3 HY 2018/19 Analyst & Media Conference
Slide 4: Highlights HY Result 2018/19
Highlights HY Result 2018/19 Antoine de Saint-Affrique, CEO
Slide 5: Strong profitability and accelerating growth momentum
Highlights HY Results 2018/19 Strong profitability and accelerating growth momentum • Sales volume up +2.4% on top of a strong prior year base • Acceleration in Q2 to +3.1% • Sales revenue of CHF 3.7 bn, +6.0% in local currencies (+3.5% in CHF) • Operating profit (EBIT) up +12.4% in local currencies
Slide 6: Volume growth +2.4%, accelerating momentum driven by chocolate
Highlights HY Results 2018/19 Volume growth +2.4%, accelerating momentum driven by chocolate HY 2018/19 volume growth vs prior year (in tonnes) FY 2017/18 HY 2018/19 FY 2016/17 +6.3% +2.4% +4.4% +4.7% +1.7% +3.1% Chocolate (FM and Gourmet & Spec.) +1.1% +4.3% +2.9% Global Cocoa +4.8% +2.3% +5.7% -2.
Slide 7: Key growth drivers gaining momentum
Highlights HY Results 2018/19 Key growth drivers gaining momentum % of total Volume growth Group volume vs prior year 34% +4.6% Emerging excl. cocoa Markets +7.4% Key growth drivers 33% Outsourcing +2.8% Long-term crucial to Partnerships continuously outperform the market 13% +4.1% Gourmet & excl. B
Slide 8: Continued expansion around the globe
Highlights HY Results 2018/19 Continued expansion around the globe Acquisition of Inforum in Russia • a leading B2B chocolate manufacturer in Russia • Acquisition closed in January 2019 Long-term supply agreement with Burton’s • Supply started in December 2018 • Expand production capacity in UK New
Slide 9: Ruby goes global!
Highlights HY Results 2018/19 Ruby goes global! Ruby 1st year anniversary Introduced by more than 20 brands Available in over 40 markets Launch of rubychocolate.com crowdsourced platform 9 HY 2018/19 Analyst & Media Conference
Slide 10: Video
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Slide 11: Innovation - there is much more going on!
Innovation - there is much more going on! • Dairy-free: launch of Magnum Vegan, with dairy-free chocolate • Sweet solutions: we are the largest producer of sugar-reduced chocolate products • Shaping experiences: leverage the knowhow of D’Orsogna and Gertrude Hawk in decorations and inclusions • Tail
Slide 12: Financial Review
Financial Review HY Results 2018/19 Remco Steenbergen, CFO
Slide 13: Profit growing above volume growth
Financial Key Figures Profit growing above volume growth Group performance HY 2018/19 % vs prior year in % vs prior year in (in CHF mio) CHF local currencies Sales volume Total 1,046,695 +2.4% n/a (in tonnes) Sales revenue 3,672.7 +3.5% +6.0% Gross profit 584.8 +5.7% +8.5% EBIT Total 301.4 +8.9% +12
Slide 14: All Regions contributed to volume growth and profitability
Regions Key Performance Indicators All Regions contributed to volume growth and profitability EMEA Group Sales Volume: Americas 480,721 1’046’695 1,046,695 281,204 tonnes APAC Global Cocoa 57,192 227,578 EMEA Americas Asia Pacific Global Cocoa FY volume growth +2.0% +5.8% +5.7% -1.7% EBIT growth in
Slide 15: Gross profit up +8.5% in local currencies
Gross Profit Gross profit up +8.5% in local currencies, driven by good product mix and a supportive market environment In CHF millions +8,5% 21 600 -15 26 -9 585 9 553 Gross Profit Volume Mix Cocoa Additional Gross Profit FX impact Gross Profit HY 2017/18 effects effects processing costs due HY 2018
Slide 16: Cocoa Combined Ratio remains at a healthy level
Cocoa processing profitability Cocoa Combined Ratio remains at a healthy level European combined ratio - 6 month forward ratio 4.00 3.50 Combined Ratio 3.5 3.00 Butter ratio 2.50 2.00 1.50 1.00 Powder ratio 0.50 0.00 août.08 août.09 août.10 août.11 août.12 août.13 août.14 août.15 août.16 août.17 aoû
Slide 17: Strong increase in Operating profit by +12.4% in local currencies
EBIT Strong increase in Operating profit by +12.4% in local currencies In CHF millions +12.4% +47 311 301 -13 277 -10 EBIT Additional Additional EBIT FX impact EBIT HY 2017/18 Gross Profit SG&A, Scope and HY 2018/19 HY 2018/19 non-rec/other before FX 17 HY 2018/19 Analyst & Media Conference
Slide 18: Net Profit up +15.1% in CHF
EBITDA to Net Profit Net Profit up +15.1% in CHF, as a result of good profitability In CHF millions 387 Tax rate: 19.3% vs PY (+7.6%) 19.5% (excl. non- recurring tax impact) 301 (+8.9%) +15.1% -85 +8.7% (-3.4%) (+12.3% in LC) -55 (-11.2%) 199 183 10 -48 173 (+12.9%) EBITDA Depr. and EBIT Financial I
Slide 19: Raw material prices
Raw material prices Price increases mainly in Sugar and Dairy during the first half. On average Cocoa bean price also increased 250% 200% Increase HY 2018/19 150% Sugar World +13.7% Milk powder +17.7% 100% Cocoa beans -0.3% Sugar EU +37.3% 50% 0% févr..09 févr..10 févr..11 févr..12 févr..13 févr..14
Slide 20: Adjusted Free cash flow CHF -31 million
HY 2018/19 Free cash flow Adjusted Free cash flow CHF -31 million on the back of higher inventory catering for future volume growth In CHF millions (6 months rolling) +7,6% -239 387 (PY -84) 359 -70 18 -31 (PY -71) (PY 5) (PY 103) -110 (PY -64) -127 -141 (PY -106) (PY 39) EBITDA EBITDA Change in Int
Slide 21: Net Debt mostly increased due to higher working capital
Financial Review Net Debt mostly increased due to higher working capital related to IFRS 15 and earlier dividend payment In CHF millions +696 +206 34 31 1.770 141 154 1.565 336 -932 1.074 838 (PY 743) Net Debt IFRS 15 Dividend & pro forma Free Cash Acquisitions FX Impact Net Debt Adjustment Adjusted
Slide 22: Balance sheet
Financial Key Figures Balance sheet (in CHF millions) Feb 2019 Aug 18 Feb 18 Aug 18 Feb 182 Pro forma1 Pro forma1 Total Assets 6,820.4 6,169.0 6,444.3 5,832.0 6,105.9 Net Working Capital 1,762.1 1,403.4 1,426.1 1,074.4 1,087.7 Non-Current Assets 2,639.9 2,506.5 2,566.5 2,505.5 2,566.5 Net Debt 1,769
Slide 23: Strategy & Outlook
Strategy & Outlook Antoine de Saint-Affrique, CEO
Slide 24: Consistent long-term strategy – evolving execution
Strategy Consistent long-term strategy – evolving execution “Heart and engine of the Vision chocolate and cocoa industry” Sustainable growth Margin accretive growth Expansion Accelerated growth in Gourmet, Specialties and 4 strategic Innovation ‘smart emerging markets pillars growth’ Return on Capit
Slide 25: Pursuing the momentum: Innovation, Expansion
Strategy Pursuing the momentum Innovation Expansion • Drive premium range in Cocoa powders • Integration of Inforum in Russia, • Leverage Innovation across segments complementary product and customer base - Callebaut Ruby RB1, Caramel doré in 2nd largest chocolate confectionary market - Sugar-reduce
Slide 26: Forever Chocolate: sustainable chocolate the norm by 2025
Strategy - Sustainability Forever Chocolate: Our plan to make sustainable chocolate the norm by 2025 Leading on carbon disclosure • Barry Callebaut’s efforts to reduce its carbon footprint awarded A- score by the Carbon Disclosure Project (CDP) Our Goal Key Metric • Ranking in top 6% of over 7,000 c
Slide 27: Schuldschein issue strengthens our debt structure
Strategy - Cost Leadership Schuldschein issue strengthens our debt structure • Average tenor is 7.8 years and has extended the Group’s average maturity to 5.5 years • Attractive interest rate of 1.65%, lowering average cost of long-term debt • The successful issuance reflects the trust of the invest
Slide 28: Confident outlook
Outlook Confident outlook Confident of reaching mid-term guidance • Good visibility in portfolio and expected acceleration in sales momentum make us confident of delivering on our current mid-term guidance. New mid-term guidance 2019/20-2021/22 • Average volume growth +4-6% • EBIT growth on average
Slide 29: Investor Day 2019
Investor Day 2019 Wieze, Belgium April 16, 2019
Slide 30: Thank you!
THANK YOU!