British American Tobacco P.l.c. · LSE:BATS
British American Tobacco P.l.c — Debt Investor Presentation (2021)
20 slides from British American Tobacco P.l.c's debt investor presentation, 2021
Slide 1: Strong Brands Drive New Category Acceleration
Strong Brands Drive New Category Acceleration Fixed Income Update Call - Interim Results 2021 Tadeu Marroco – Finance and Transformation Director | Neil Wadey – Group Head of Treasury
Slide 2: Important Information
Important Information The information contained in this presentation in relation to British American Tobacco p.l.c. (“BAT”) and its subsidiaries has been prepared solely for use at this presentation. The presentation is not directed to, or intended for distribution to or use by, any person or entity
Slide 3: Important Information (continued)
Important Information Forward-looking Statements (continued) Additional information concerning these and other factors can be found in BAT’s filings with the U.S. Securities and Exchange Commission (“SEC”), including the Annual Report on Form 20-F and Current Reports on Form 6-K, which may be obtain
Slide 4: Strong Brands Drive New Category Acceleration
Strong Brands Drive New Category Acceleration Fixed Income Update Call - Interim Results 2021 Tadeu Marroco – Finance and Transformation Director | Neil Wadey – Group Head of Treasury
Slide 5: Building A Better Tomorrow
Building A Better TomorrowTM Our Purpose Our Commitment To provide adult To reduce the consumers with a wide health impact range of enjoyable and of our business less risky products To encourage smokers to switch completely to scientifically-substantiated reduced-risk alternatives* * Based on the we
Slide 6: Delivering Our Purpose is Transforming BAT
Delivering Our Purpose is Transforming BAT From To Multi-category CPG Cigarettes Nicotine & Beyond* Declining Volume Growing Volume Growing Value & Value Creating value for all our stakeholders 50 million consumers of £5bn New Category Eliminate unnecessary single-use Carbon neutral non-combustible*
Slide 7: HY 2021: Consumer-Centric Multi-Category Strategy Delivering Strong Growth
HY 2021: Consumer–Centric Multi–Category Strategy Delivering Strong Growth Consumer Consumer Digital Multi- • Strong New Category momentum, revenue* up +50% Insights Category Moments Portfolio • Building strong brands - leveraging digital • Continued progress on ESG Consumer Centricity 91 /100 Digit
Slide 8: HY 2021: Strong New Category Momentum
HY 2021: Strong New Category Momentum New Category Revenue* up +50% Record H1 NC Consumer Acquisition**, up +2.6m to 16.1m Global Fastest Growing Global Leadership THP Brand Leadership ambition ambition ambition Revenue* up +59% Revenue* up +38% Revenue* up +63% * Revenue growth at constant rates. S
Slide 9: HY 2021: Building A Better Tomorrow
HY 2021: Building A Better TomorrowTM 16.1m 32 % 17 % 40 % Non-Combustible Value Share Volume share Volume Share product consumers* In Top 5 markets** In Top 9 markets** In Top 5 markets** +2.6m +6.1ppts +3.2ppts +2.8ppts Growth Growth Growth Growth Growth May YTD versus FY20. Source: Company data.
Slide 10: HY 2021 - Accelerating Consumer Acquisition Across All Three Categories
HY 2021 - Accelerating Consumer Acquisition* Across All Three Categories Number of consumers of Non-Combustible** products Vapour THP ModernOral TraditionalOral 16.1 m 7.5 m 5.3 m 2.2 m 3.0 m +2.6m (19%) +0.9m (13%) +1.2m (31%) +0.7m (45%) Flat When including Includes consumer poly-usage***: 1.9m (+
Slide 11: HY 2021: Accelerating Consumer Acquisition
HY 2021: Accelerating Consumer Acquisition* Record 1H21 Performance: +2.6m vs. Dec 20 (c. 2.5x vs. 1 year ago); +4.5m vs. Jun 20 +2.6m 16.1 Accelerating & +1.9m Highest ever 13.5 6-monthly growth +1.1m 11.6 c.85% +1.6m of FY 2020 10.5 +0.9m growth already 8.9 achieved in 8 1H21 2018 Dec 2019 Jun 201
Slide 12: Combustibles: Delivering Value Growth
Combustibles: Delivering Value Growth +10 bps +10 bps +20 bps Combustibles Value Combustibles Volume Strategic Brand Share^ Share^ Value Share^ +5.8 % +4.3 % -17 % Combustibles Combustibles SKU rationalisation Revenue* Price/Mix** completed to date*** Share growth versus FY20. Cigarette share. ^ See
Slide 13: HY 2021: Strong Results
HY 2021: Strong Results +50% +4.3% +10bps +5.4% New Category Combustibles Cigarette & THP Adjusted Profit* Revenue* Price/Mix** Value Share^ from Operations +8.1% +1.5% +20bps +6.1% Group Combustibles Cigarette & THP Adjusted Diluted Revenue* BAT Volumes Volume Share^ EPS* Share growth YTD May 21 ve
Slide 14: Accelerating our Transformation
Accelerating our Transformation Strong progress against financial focus areas 1. Releasing funds to support growth agenda • £0.9bn total Quantum savings delivered to date • Value through combustibles, revenue* up +5.8% 2. Maximising marketing spend effectiveness • c.£350m incremental** investment dr
Slide 15: Accelerating Portfolio Transformation
Accelerating Portfolio Transformation % of H1 DM/EM revenue in % of H1 Group revenue non-combustibles in non-combustibles 15% 12% 1 + ppts v FY20 4% 2 + ppts v FY20 2 + ppts v FY20 Developed Emerging Group Markets (DM) Markets (EM) (c.70% of Group Revenue) (c.30% of Group revenue) Source: Company da
Slide 16: Group Operating Margin: Strong Operational Performance Funding New Category Investment
Group Operating Margin: Strong Operational Performance Funding New Category Investment -0.7 +1.5 -1.6 43.7 -0.6 43.0 +c.£350m New Category Marketing Investment H1 2020 Adjusted Price/mix and Incremental Transactional FX H1 2021 Adjusted Operating Margin Operational Efficiencies New Categories Operat
Slide 17: Cash: Continued Cash Flow Delivery
Cash: Continued Cash Flow Delivery H1 Operating • Further strong cash flow delivery: Cash Flow Conversion • Combustibles price/mix growth 80% • New ways of working releasing cash from business 66% 67% • Year-on-year comparison largely impacted by the 65%* deferral of excise in the US in H1’20 • Cash
Slide 18: FY 2021 Guidance: Strong Operational Momentum and Cash flow
FY 2021 Guidance: Strong Operational Momentum and Cash flow • Continued strong New Category revenue growth* >5% • Improved global combustibles volume outlook, driven by Emerging Market recovery Revenue Growth* • H2 to reflect geographic & portfolio mix and strong comparator • Further incremental New
Slide 19: 2021 - A Pivotal Year
2021 - A Pivotal Year New Category revenue* +50%; share gains in all 3 categories STEP-CHANGE IN NEW CATEGORIES 16.1m non-combustible product consumers**, up 2.6m FY New Category losses expected to reduce COMBUSTIBLE SIMPLIFY VALUE On track to reach c.3x Adj. Net Debt/Adj. EBITDA*** THE COMPANY GROW
Slide 20: Appendix
Appendix A1: Adjusting (Adj.) Adjusting items represent certain items which the Group considers distinctive based upon their size, nature or incidence. A2: Constant currency Constant currency – measures are calculated based on the prior year's exchange rate, removing the potentially distorting effec
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