Vina Concha Y Toro S.a. · BCS:CONCHATORO
Vina Concha Y Toro — Q2 2022 Earnings Presentation
41 slides from Vina Concha Y Toro's earnings presentation, Aug 17, 2022
Slide 1: 2Q22 Results Investor Presentation
2Q22 Results INVESTOR PRESENTATION
Slide 2: Agenda
2Q22 RESULTS | VIÑA CONCHA Y TORO 02 AGENDA Chap. 01 2022 Vision and 1H22 Results Eduardo Guilisasti, CEO Chap. 02 2Q22 Sales Analysis Blanca Bustamante, IR Director Chap. 03 2Q22 and 1H22 Financial Result Osvaldo Solar, CFO
Slide 3: 2022 Vision and 1H22 Results
2Q22 RESULTS | VIÑA CONCHA Y TORO 3 Chap. 01 2022 Vision and 1H22 Results Eduardo Guilisasti, CEO
Slide 4: How Concha y Toro have faced this year?
2Q22 RESULTS | VIÑA CONCHA Y TORO 4 How Concha y Toro have faced this year? Excessively complex and uncertain year. A year that has tested the resilience of our Company and challenges us to continue looking at the medium and long term.
Slide 5: The resilience to adapt quickly and with conviction to the new environment
2Q22 RESULTS | VIÑA CONCHA Y TORO 5 The resilience to adapt quickly and with conviction to the new environment: productive, logistical, commercial and financial, in the three countries where we have productive operations and in the most varied markets in the world.
Slide 6: Aspects that we have worked on and adapted
2Q22 RESULTS | VIÑA CONCHA Y TORO Aspects that we have worked on and adapted: • Productive: Ensure the production of our products, in wines, supplies and availability of labor. • Logistics: Make a strong follow-up of our logistics chain, strengthening our relationship with the main shipping companie
Slide 7: Proven experience and medium and long-term vision
2Q22 RESULTS | VIÑA CONCHA Y TORO 7 We have been in this business for decades and we have proven experience to, without losing the focus that is required in the short term, not stop looking at the medium and long term. This vision has given the Company and its shareholders a security that beyond the
Slide 8: Initiatives implemented in the first semester
2Q22 RESULTS | VIÑA CONCHA Y TORO Initiatives that we have implemented in this first semester, with a medium and long-term vision: • Adjustments in the prices of our main brands that allow us to face higher rates of inflation, volatility in exchange rates, and more structural changes in shipping far
Slide 9: Initiatives implemented in the first semester
2Q22 RESULTS | VIÑA CONCHA Y TORO Initiatives that we have implemented in this first semester, with a medium and long-term vision: • Acquisition of new lands that allows us to continue with a high percentage of our own grape production, which conforms to meet the objectives of our strategy. • Excell
Slide 10: 1H22 Results
2Q22 RESULTS | VIÑA CONCHA Y TORO 10 10 Chap. 01 1H22 Results Eduardo Guilisasti, CEO
Slide 11: Consolidated sales grew 7%
2Q22 RESULTS | VIÑA CONCHA Y TORO 11 Consolidated sales grew 7% This result reflects a positive effect of a higher average price, a favorable exchange rate effect, offset by a lower volume. Ch$ MM +7.0% 400,236 373,898 VAR Wine +5.5% 1H21 1H22 (Ch$ million)
Slide 12: Consolidated volume down 9.7%
2Q22 RESULTS | VIÑA CONCHA Y TORO 12 Consolidated volume down 9.7% Miles de C9L (9.7%) 17,790 16,068 VAR Wine (11.0%) 1H21 1H22 (thousand of C9L)
Slide 13: Wine: Brand Matrix performance
2Q22 RESULTS | VIÑA CONCHA Y TORO 13 Wine: Brand Matrix performance WINE VAR % VALUE VAR. % VOL. PRINCIPAL 3.9% (13.7%) BRAND MATRIX INVEST 5.8% (8.2%) PROTECT 11.6% (4.7%) WATCH (3.8%) (23.9%) PORTFOLIO SUPER & ULTRA PREMIUM 46.0% 20.0% TOTAL WINE 5.5% (11.0%)
Slide 14: Relevant aspects
2Q22 RESULTS | VIÑA CONCHA Y TORO Relevant aspects: • Due to the inflationary effects, a slight change is perceived in the consumer to buy products of lower value, within the Premium and Lower categories. It is a strength of our Company to have a portfolio that covers all relevant categories. • In t
Slide 15: Gross profit increased 9.1%
2Q22 RESULTS | VIÑA CONCHA Y TORO 15 Gross profit increased 9.1% (Ch$ million) 1H22 1H21 VAR (%) Consolidated sales 400,236 373,898 7.0% Gross profit 157,011 143,851 9.1% Gross margin 39.2% 38.5% 80 bp
Slide 16: SG&A growth: 22.2%
2Q22 RESULTS | VIÑA CONCHA Y TORO 16 SG&A growth: 22,2% (Ch$ million) 1H22 1H21 VAR (%) SG&A (106,869) (87,431) 22.2% SG&A / Sales 26.7% 23.4% 330 bp 3 concepts that mainly explain the increase in SG&A: 1. Remuneration, personnel expenses, and third party services with +15% and a net increase of Ch$
Slide 17: EBIT y Net profit
2Q22 RESULTS | VIÑA CONCHA Y TORO 17 EBIT y Net profit IISS 1H22 1H21 Var (%) (Ch$ million) % / Sales % / Sales % / Sales Consolidated sales 400,236 373,898 7.0% Gross profit 157,011 39.2% 143,851 38.5% 9.1% 80 bp SG&A (106,869) 26.7% (87,431) 23.4% 22.2% 330 bp Other incomes and expenses (980) (116
Slide 18: 2Q22 Sales Analysis
2Q22 RESULTS | VIÑA CONCHA Y TORO 18 Chap. 02 2Q22 Sales Analysis Blanca Bustamante, Director of Investor Relations
Slide 19: 2Q22 Sales growth
2Q22 RESULTS | VIÑA CONCHA Y TORO 19 2Q22 Sales growth Result that reflects a positive effect due to higher average price, favorable exchange rate effect, offset by a lower volume. VAR +5.6% +5.1% Wine 210,395 222,180 VAR +15.3% Other business 2Q21 2Q22 (Ch$ million)
Slide 20: 2Q22 Volume
2Q22 RESULTS | VIÑA CONCHA Y TORO 20 2Q22 Volume VAR (10.8%) (11.0%) Wine 9,861 8,795 VAR (8.0%) Other business 2Q21 2Q22 (thousand of C9L)
Slide 21: Main markets performance
2Q22 RESULTS | VIÑA CONCHA Y TORO 21 Main markets performance 2Q22 % OF SALES VAR % VALUE VAR % VOLUME UK 24.5% 5.4% (12.2%) USA 15.4% 5.4% (15.3%) Chile 14.6% (5.0%) (11.7%) Brazil 9.2% 7.2% (14.7%) Mexico 4.9% 48.6% 29.9% Canada 3.0% 14.5% 3.6% China 2.7% 17.9% 10.7% Sweden 2.1% 1.5% (0.3%)
Slide 22: Wine: Brand matrix performance
2Q22 RESULTS | VIÑA CONCHA Y TORO 22 Wine: Brand matrix performance WINE VAR % VALUE VAR. % VOL. PRINCIPAL 3.3% (11.9%) BRAND MATRIX INVEST 1.3% (10.0%) PROTECT 14.4% (4.2%) WATCH (15.3%) (31.4%) PORTFOLIO SUPER & ULTRA PREMIUM 44.3% 25.1% WINE TOTAL 5.1% (11.0%)
Slide 23: Premium mix
2Q22 RESULTS | VIÑA CONCHA Y TORO 23 Premium mix Slight drop in the Principal and Invest mix, given volume adjustments in the company's main export markets. % OF SALE IN VALUE % DE LA VENTA EN VALOR 50.1% 49.1% 49.9% 50.9% 2Q21 2Q22 Others Principal + Invest
Slide 24: Financial Results – 2Q22
2Q22 RESULTS | VIÑA CONCHA Y TORO 24 Chap. 03 Financial Results – 2Q22 Osvaldo Solar, CFO
Slide 25: Gross profit +5.1%
2Q22 RESULTS | VIÑA CONCHA Y TORO 25 Gross profit +5.1% (Ch$ million) 2Q22 2Q21 Var (%) Consolidated sales 222,180 210,395 5.6% Gross profit 85,359 81,182 5.1% Gross margin 38.4% 38.6% (20 bp)
Slide 26: SG&A – Impact due to increased freight, wages and marketing
2Q22 RESULTS | VIÑA CONCHA Y TORO 26 SG&A – Impact due to increased freight, wages and marketing (Ch$ million) 2Q22 2Q21 Var (%) Consolidated sales 222,180 210,395 5.6% Gross profit 85,359 81,182 5.1% SG&A (58,720) (47,546) 23.5% SG&A / Sales 26.4% 22.6% 380 bp
Slide 27: Other income and expenses
2Q22 RESULTS | VIÑA CONCHA Y TORO 27 Other income and expenses This result mainly reflects non-recurring expenses in this quarter related to extraordinary freights necessary to timely fulfill commercial contracts. (Ch$ million) 2Q22 2Q21 Var (%) Consolidated sales 222,180 210,395 5.6% Gross profit 8
Slide 28: EBIT and EBITDA
2Q22 RESULTS | VIÑA CONCHA Y TORO 28 EBIT and EBITDA: IISS 2Q22 2Q21 Var (%) (Ch$ million) % / Sales % / Sales % / Sales Consolidated sales 222,180 210,395 5.6% Gross profit 85,359 38.4% 81,182 38.6% 5.1% (20 bp) SG&A (58,720) 26.4% (47,546) 22.6% 23.5% 380 bp Other income and expenses (2,056) 247 E
Slide 29: Non-Operating result
2Q22 RESULTS | VIÑA CONCHA Y TORO 29 Non-Operating result • Lower net financial expenses • Better result of Exchange Differences and Associated Companies (Ch$ million) 2Q22 2Q21 Var (%) Var (Ch$) Net Financial expense (*) (1,933) (2,234) (13.5%) 301 Exchange differences 776 (275) 1,051 Associated co
Slide 30: Financial expenses and Exchange differences
2Q22 RESULTS | VIÑA CONCHA Y TORO 30 Financial expenses and Exchange differences I M P R O V E M E N T I N N E T F I N A N C I A L E X P E N S E S D U E TO H I G H E R C A S H B A L A N C E S Non-operating income improved by Ch$ 1,872 M due to: • Lower net financial expense of Ch$ 301 M. • Improveme
Slide 31: 2Q22 Currency diversification
2Q22 RESULTS | VIÑA CONCHA Y TORO 31 2Q22 Currency diversification Diversification of currencies attenuates the variations of the dollar as a single currency. ARG MXN CNY 0,9% 4,7% 1,5% Exchange rate variation 2Q22 vs 2Q21 BRL NOK CLP 7,1% 1,4% 16,6% Dolar: +18.4% SEK CyT basket: +11.7% 2,1% CAD 3,3
Slide 32: 2Q22 Taxes
2RQ E 2S 2U LRTEA SDUO L TSS1 |QV2 I0Ñ2A2 C O N C H A Y T O R O 32 2Q22 Taxes (Ch$ million) 2Q22 2Q21 Var (%) Consolidated sales 222,180 210,395 5.6% Gross profit 85,359 81,182 5.1% EBIT 24,583 33,882 (27.4%) Profit before taxes 23,783 31,210 (23.8%) Taxes (250) (7,866) (96.8%)
Slide 33: 2Q22 Net profit
2Q22 RESULTS | VIÑA CONCHA Y TORO 33 2Q22 Net profit (Ch$ million) 2Q22 2Q21 Var (%) Consolidated sales 222,180 210,395 5.6% Gross profit 85,359 81,182 5.1% EBIT 24,583 33,882 (27.4%) Net profit 23,201 23,015 0.8% Net margin 10.4% 10.9% (50 bp)
Slide 34: 1H22 Net profit
2Q22 RESULTS | VIÑA CONCHA Y TORO 34 1H22 Net profit (Ch$ million) 1H22 1H21 Var (%) Consolidated sales 400,236 373,898 7.0% Gross profit 157,011 143,851 9.1% EBIT 49,162 56,932 (13.6%) Net profit 40,878 37,746 8.3% Net margin 10.2% 10.1% 10 bp
Slide 35: 1H22: Net profit +8.3% and Net margin +10 bp
2Q22 RESULTS | VIÑA CONCHA Y TORO 35 1H22: Net profit +8.3% and Net margin +10 bp (Ch$ M) 120.000 14,0% 11.8% 100.000 12,0% 10.1% 10.1% 10.2% 10,0% 80.000 8.1% 8.0% 8.0% 8,0% 60.000 +8.3% 98,810 6,0% 40.000 77,994 4,0% 49,575 49,111 52,500 20.000 37,746 40,878 2,0% - 0,0% 2017 2018 2019 2020 2021 1H
Slide 36: Return over invested capital – ROIC
2Q22 RESULTS | VIÑA CONCHA Y TORO 36 Return over invested capital – ROIC 11.3% 10.9% 10.8% 10.3% 7.4% 7.2% 2018 2019 2020 2021 jun-21 1H21 jun-22 1H22 ROIC: (Operating Margin – Taxes + Exchange Difference) / (Equity – Other Financial Liabilities – Derivatives – Cash). * Income Statement corresponds
Slide 37: Net financial debt
2Q22 RESULTS | VIÑA CONCHA Y TORO 37 Net financial debt +31.3% 316,038 266,898 250,413 240,573 240,632 Increases in: 221,101 201,374 Ch$ 75,407 MM vs 1H21 Increases in: Ch$ 75,466 MM vs 2021 2017 2018 2019 2020 2021 jun-21 1H21 jun-22 1H22 Net financial debt is calculated as: Gross financial debt in
Slide 38: Financial strength
2Q22 RESULTS | VIÑA CONCHA Y TORO 38 Financial strength Net Debt Ratio (Net Financial Liabilities*/ Equity) 1.2 0.67 0.49 0.52 0.55 0.36 0.42 2018 2019 2020 2021 jun-21 1H21 jun-22 1H22 Net Debt Ratio Covenants (*) Net Financial Liabilities corresponds to Other Current and Non-Current Financial Liab
Slide 39: Debt and Financial Expense vs. Cash Generation
2Q22 RESULTS | VIÑA CONCHA Y TORO 39 Debt and Financial Expense vs. Cash Generation: FINANCIAL STRENGTH EBITDA / FINANCIAL EXPENSES NET FINANCIAL DEBT*/ EBITDA 2.9 12.6 2.6 11.5 11.0 9.7 2.0 8.4 7.4 1.5 1.5 1.4 2,5 2.5 2018 2019 2020 2021 jun-21 1H21 jun-22 1H22 2018 2019 2020 2021 1H21 jun-21 1H22
Slide 40: Outlook
2Q22 RESULTS | VIÑA CONCHA Y TORO 40 OUTLOOK In a scenario that remains challenging, we continue to work on our profitability and growth objectives with a medium and long-term perspective. • We will continue to make price adjustments in different markets. • Investment in brand building. • Tight cont
Slide 41: 2Q22 Results
2Q22 Results INVESTOR PRESENTATION