Corby Spirit And Wine Limited Class A · TSX:CSW.A
Corby Spirit And Wine Limited Class A — Non-Deal Roadshow (March 2024)
35 slides from Corby Spirit And Wine Limited Class A's roadshow presentation, March 2024
Slide 1: Virtual Roadshow
2024 Virtual Roadshow Nicolas Krantz Juan Alonso TSX: CSW.A and CSW.B
Slide 2: Nicolas Krantz and Juan Alonso
NICOLAS KRANTZ President & CEO JUAN ALONSO Vice-President & CFO 2 TSX: CSW.A and CSW.B
Slide 3: Forward Looking Statement
FORWARD LOOKING STATEMENT Today’s presentation contains forward-looking statements, including statements concerning possible or assumed future results of operations of Corby Spirit and Wine Limited. Forward-looking statements typically are preceded by, followed by or include the words “believes”, “e
Slide 4: Agenda
AGENDA • Corby Introduction • Canadian Market and Trends • Strategic Priorities • Acquisition of Ace Beverage Group • Our ESG Roadmap • FY23 Financial Highlights • H1 FY24 Results • Conclusion 4
Slide 5: Introduction
INTRODUCTION •Who is Corby? •Our Portfolio •Our Route to Market 5 TSX: CSW.A and CSW.B
Slide 6: Corby, the Beverage Market and RTM in Canada
Corby, the Beverage Market and RTM in Canada TSX: CSW.A and CSW.B 6
Slide 7: Canadian Market Trends
CANADIAN MARKET TRENDS A historically-mature domestic market with recent slowdown in growth, as On- Premise continues to normalize & Retail declines. CATEGORY Spirits Wines RTDs Rolling 12-month period at the end of Dec.2023 +0.4% -2.4% +8.2% Value Value Value Spirits Wines RTDs TL H1 period at the
Slide 8: Within the C$7.4B Canadian spirits market, Corby has a strong market share
Within the C$7.4B Canadian spirits market, Corby has a strong market share in top spirits categories 1,736 1,059 1,056 1,051 R12 Retail Value ($M) 521 478 314 277 265 175 138 VODKA LIQUEURS CANADIAN RUM TEQUILA GIN SINGLE MALT BLENDED BOURBON IRISH WHISKY WHISKEY COGNAC BRANDY WHISKY SCOTCH SCOTCH C
Slide 9: Strong Market Position
STRONG MARKET POSITION 16.7% in spirits and 2.1% in wines Corby Beats the Market Market Corby • #2 in the Canadian spirits market • 3 of the top 10 spirits brands in Canada by value: Absolut, J.P. Wiser’s Spirits +0.4% +1.9% & Jameson • Corby is the market leader by volume in Irish Whiskey and Singl
Slide 10: Portfolio Management
PORTFOLIO MANAGEMENT Putting consumers and occasions first to build and scale brands CONTEXT DRIVES NEEDS DRIVES DRIVES CHOICE WHO WHERE WHY CONSIDERS OPTIONS FROM WHAT EMOTIONAL NEEDS CONSIDERS OPTIONS VARIOUS FROM CATEGORIES WHEN WHAT FUNCTIONAL NEEDS VARIOUS CATEGORIES … AND WILL CHOOSE FROM MOST
Slide 11: Innovation
INNOVATION Anchored in consumer trends and delivering 1/3 of Corby Spirits' value growth Click to edit sub-headline 11 TSX: CSW.A and CSW.B
Slide 12: Ace Beverage Group
Ace Beverage Group Click to edit sub-headline 12 TSX: CSW.A and CSW.B
Slide 13: Transaction Strategic Rationale and Benefits
TRANSACTION STRATEGIC RATIONALE AND BENEFITS Provides further expansion into the large, 01 fast-growing and highly attractive RTD segment. Fuels Corby’s quest for continued innovation by combining two companies 02 with track records of building leading brands. Highly accretive 03 transaction transfo
Slide 14: Ace Beverage Group key metrics
1 1 NOVEMBER 2023 # # RTD BRAND IN RTD SKU THE LCBO IN ONTARIO (COTTAGE SPRINGS 24) $ 85M 35 % COTTAGE SPRINGS LCBO REVENUE CAGR RETAIL SALES (2023) (2019A – 2024F) 2 26 ABG x CORBY | AGM TIME LCBO SUPPLIER OF THE YEAR 2024 LCBO RTD (2021 & 2022) LISTINGS (4 NEW) 14 TSX: CSW.A and CSW.B
Slide 15: Opportunity to further increase RTD penetration in Ontario
Opportunity to further increase RTD penetration in Ontario and expand Ace in provinces outside Ontario BRITISH COLUMBIA WESTERN CANADA ONTARIO QUÉBEC ATLANTIC PROVINCES Retail Value $400m $500m $900m $200m $300m & (18% of total (18% of total (12% of total (4% of total (20% of total RTD Share alcohol
Slide 16: Welcoming new super-premium brands
Welcoming new Click to edit sub-headline super-premium brands Bumbu: Codigo: Luc Belaire: Skrewball: Jefferson: Premium Rum Premium Tequila Sparkling Wines Peanut Butter Whisky Bourbon 16 TSX: CSW.A and CSW.B
Slide 17: Corby has the most diverse portfolio of strong brands
Corby has the most diverse portfolio of strong brands across all Spirits, Wines and RTD categories NEW NEW ULTRA NEW PREMIUM NEW NEW NEW NEW SUPER PREMIUM NEW NEW PREMIUM NEW NEW STANDARD SINGLE BLENDED IRISH RTD’S 17 VODKA LIQUEURS CANADIAN WHISKY RUM GIN TEQUILA BOURBON WINE MALT SCOTCH WHISKEY TS
Slide 18: Other Key Strategic Pillars
OTHER KEY STRATEGIC PILLARS Excellence of Off and On-Premise with Corby as #1 in Execution market E-commerce as fast-growing New Channel channel Opportunities Export with Canadian whisky being the largest imported whisky category in the US OFFICIAL WHISKY OF THE DETROIT RED WINGS Digital Leveraging
Slide 19: Environmental, Social & Governance
ENVIRONMENTAL, SOCIAL & GOVERNANCE 19 TSX: CSW.A and CSW.B
Slide 20: Sustainability & Responsibility
Sustainability & Responsibility TSX: CSW.A and CSW.B 20
Slide 21: Experienced & Diverse Management Team
Experienced & Diverse Management Team Nicolas Krantz Juan Alonso Caroline Begley Ryan Smith Valerie Brive-Turtle President, Chief Executive Vice-President, Vice-President, Marketing Vice-President, Sales Senior Director, Communications, Officer Chief Financial Officer PR and S&R Vanita Kakkar Stépha
Slide 22: Financial Highlights
FINANCIAL HIGHLIGHTS FISCAL YEAR 2023 22 TSX: CSW.A and CSW.B
Slide 23: Key Financial Metrics
KEY FINANCIAL METRICS Full Year FY23 Case Goods Volume Revenue Cost of Sales 2.1m 9Lc $163m -$68.8m -1% +2% +9% Adj. Earnings Adj. Net Earnings Net Cash from Operating from Ops. Activities $25.3m $32.4m $35.4m -1% -7% Reported Earnings from Ops. -$10.1m Reported Net Earnings $22.0m / -6% $28.3m / -1
Slide 24: Consistently Strong Annual Dividends Paid and Cash Conversion
CONSISTENTLY STRONG ANNUAL DIVIDENDS PAID AND CASH CONVERSION… 1 CA$M FY2 2 FY2 3 Cash, beginning of year 9 4 .4 5 2 .5 Cash Flow from Operating Activities 45.5 35.4 Additions to PP&E (4.4) (3.6) 1.9 1.9 2 1.6 Additions to Intangible Assets (55.3) (0.8) 1.3 1.3 Free Cash Flow (14 .1) 3 1.0 2 1 Proce
Slide 25: Enabling High Dividends Payout Ratio and Strong Dividend Yields
… ENABLING HIGH DIVIDENDS PAYOUT RATIO AND DELIVERING STRONG DIVIDEND YIELDS 95% 98% 100 90% 87% 5.4% 5.5 5.3% 5.2% $1.07 80 5.0% 5.0 $0.94 $0.93 $0.88 60 4.5 $0.84 $0.89 40 4.0 $0.86 $0.89 20 3.5 0 3.0 FY20 FY21 FY22 FY23 FY20 FY21 FY22 FY23 Adj EPS* Dividend Yield** Dividends Paid Payout as % of P
Slide 26: H1 FY24 Results
H1 FY24 RESULTS 26 TSX: CSW.A and CSW.B
Slide 27: Robust Financial Performance, Despite Market Slowdown
ROBUST FINANCIAL PERFORMANCE, DESPITE MARKET SLOWDOWN H1 FY24 results Case Goods Revenue H1 FY24 Dividend Volume 2m 9Lc $114.7m $0.42 +81% +33% Q1: $0.21 Q2: $0.21 955k 9Lc $27.8m Consistent with LY Adj. Earnings Adj. Net Earnings Cash from Operating from Ops. Activities $26.2m $17.3m $21.2m +21% +6
Slide 28: H1 FY24 Revenue Grew +33% / +$28.2M
H1 FY24 REVENUE GREW +33% / +$28.2M Revenue year-on-year growth breakdown, in $m +28.2 +27.8 -0.4 +1.6 +0.5 -1.3 Total Revenue Domestic International Other non-core Case Goods Commissions business services Case Goods $114.7m $63.4m $7.7m $13.9m $2.0m +33% -1% +27% -9% +35% Lapping a high basis LY H1
Slide 29: ABG Contribution to Net Sales Growth Varies Across Quarters
ABG CONTRIBUTION TO NET SALES GROWTH VARIES ACROSS QUARTERS DUE TO DIFFERENT SEASONALITY PATTERNS H1’24 Q1 Q2 QUARTERLY +43% +23% +33% REVENUE GROWTH Q1 Q2 Q3 Q4 Jul – Aug – Sep Oct – Nov – Dec Jan – Feb – Mar Apr – May – Jun SPIRITS TYPICAL SEASONALITY TRENDS 25% 30% 20% 25% RTD TYPICAL SEASONALITY
Slide 30: H1 FY24 Brand Performance
H1 FY24 BRAND PERFORMANCE UNGAVA SPIRITS POLAR ICE J.P. WISER’S BRANDS VODKA COMMISSION Volume Volume Volume -5% +5% -1% INCOME Revenue Revenue Revenue -9% Flat +3% +2% +11% H1 FY23 vs PY MIXABLE LIQUEURS LAMB’S RUM Volume Volume -3% -7% ~25% of Revenue Revenue Total Revenue +1% +3% 30 TSX: CSW.A an
Slide 31: Resilient Financial Results Enhanced by ABG Performance Inclusion
RESILIENT FINANCIAL RESULTS ENHANCED BY ABG PERFORMANCE INCLUSION C$m H1 FY24 % change Revenue 114.7 +33% Total cost of Sales, Marketing, and Administration (91.9) +42% Adjusted Net Earnings Earnings from Operations 22.8 +5% per share Adj. Earnings from Operations 26.2 +21% $0.61 Financial result (2
Slide 32: Consistent Cash Conversion and Dividends Paid
CONSISTENT CASH CONVERSION AND DIVIDENDS PAID, WHILE CONTINUING ROBUST YIELD AND PAYOUT RATIOS 1.9 2 1.6 1.4 CA$m H1 FY23 H1 FY24 1.3 Net cash and debt , beginning of period 5 2 .5 3 9 .4 1 Cash Flow from Operating Activities 15.2 21.2 0 Additions to PP&E (1.4) (1.1) FY21 FY22 FY23 H1 FY24 Free Cash
Slide 33: Conclusion
CONCLUSION 33 TSX: CSW.A and CSW.B
Slide 34: Why invest?
1. Business Model Why invest? • • World-class portfolio of brands Dedicated sales force • Clear strategic priorities and acquisitions 01 • Strong support from Pernod Ricard 2 2. Consistent Financials • Resilient revenues • Strong cash conversion • Long history of generous dividend payment – 5% yield
Slide 35: Q&A
CORBY Q&A TSX: CSW.A and CSW.B
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