Pernod Ricard SA · EURONEXT:RI
Pernod Ricard SA — Shareholder Meeting (2003)
88 slides from Pernod Ricard SA's shareholder meeting presentation, 2003
Slide 1: Wine & Spirits 2002 results: confirmation of anticipated synergies
Wine & Spirits 2002 results: confirmation of anticipated synergies 1
Slide 2: Wine & Spirits Sales
Wine & Spirits Sales Sales: + 78% Healthy organic growth: + 4,5% Sharply adverse currency impact on historical brands: - € 49 million 3,408 + 78 % 1,760 1,918 - Organic growth: + 4.5% - Forex: - 2.5 % - Perimeter: + 2.0 % €m - Seagram: + 73.8 % 2000 2001 2002 2
Slide 3: Sales by region
Wine & Spirits Sales by region A balanced geographical split 1,330 France + 8.6 % Europe + 52.4 % 592 873 546 Organic growth +0.8% Organic growth +6.4% Seagram €42m Seagram €371m 2001 2002 2001 2002 17% 39% 25% 19% (€m) 835 651 Americas x 3.5 Rest of world x 2.5 Organic growth +8.5% 242 Organic grow
Slide 4: EBIT
Wine & Spirits EBIT Wine and Spirits EBIT target exceeded Full effects of Seagram-related synergies Strong, steady organic growth: + 7.5 % 710 + 106 % 344 302 - Organic growth: + 7.5 % - Forex: - 1.5 % -Perimeter: +100 % €m 2000 2001 2002 17.1 % 17.9 % 20.8 % EBIT margin 4
Slide 5: EBIT by region
Wine & Spirits EBIT by region Critical mass reached in all regions 277 France + 14 % Europe + 52 % 182 120 106 % 01 02 % 01 02 EBIT 19.4 20.3 EBIT 20.8 20.8 margin margin 2001 2002 2001 2002 17% 39% 25% 19% (m€) Americas x 5.6 176 Rest of world x 5.3 137 % 01 02 % 01 02 31 26 EBIT 12.9 21.1 EBIT 9.9
Slide 6: A&P Investments
Wine & Spirits A&P Investments A&P investments maintained at a high level 729 + 83 % 398 €m 2001 2002 % of sales 20.7 21.4 Policy to be maintained in 2003 6
Slide 7: Structure costs
Wine & Spirits Structure costs Decline in structure costs as a proportion of sales Distribution costs Overheads and trading costs 648 443 134 83 €m €m 2001 2002 2001 2002 % of sales 4.3 3.9 % of sales 23.1 19.0 Impact of synergies from the acquisition felt from 2002 7
Slide 8: Diversified activities: Withdrawal almost complete
Diversified activities Withdrawal almost complete 8
Slide 9: Diversified activities: Withdrawal almost complete
Diversified activities Withdrawal almost complete ` Disposals in 2002: SIAS, BWG, CSR ` Remaining activities to be sold (sales of approx. € 100 million)… ` …including the distribution of Orangina (in UK, South America, Africa, Asia and some countries in Eastern Europe) which the Group has an option
Slide 10: Diversified activities EBIT
Diversified activities EBIT (€m) 2001 2002 Change Sales 2,637 1,428 - 46 % EBIT 106 40 - 62 % In 2002, sales and EBIT relate principally to SIAS and BWG activities while they were still part of the Group 10
Slide 11: Above-forecast financial results
Above-forecast financial results 11
Slide 12: Consolidated 2002 Results
Consolidated 2002 Results (€m) 2001 2002 Change Consolidated Consolidated Sales excl. T&D 4,555 4,836 +6% EBIT 451 750 + 67 % Pre-tax profit 411 597 + 45 % Group share of net profit 358 413 + 15 % Group net profit 258 410 + 59 % (excluding « non-recurring » items) A very profitable operation from th
Slide 13: Consolidated 2002 Results: free cash flow
Consolidated 2002 Results (€m) 2001 2002 Change Operating Cash flow 372 480 + 29 % Change in WC* (17) 106 CAPEX (106) (156) Free cash flow 249 430 + 73 % *After restatement of tax on sale of Orangina (€139m) Strong growth in free cash flow 13
Slide 14: Sharp fall in debt in one year
Consolidated 2002 Results ` Sharp fall in debt in one year Net debt (1) Gearing (1) 3,695 2 2,725 2,294 1.47 1.5 1.17 1 €m 0.88 31/12/01 30/06/02 31/12/02 0.5 (1) OCÉANE excluded from 31/12/01 30/06/02 31/12/02 debt and equity Limited average cost of debt in 2002: 4.4 % 14
Slide 15: Outstanding financial ratios
Consolidated 2002 Results ` Outstanding financial ratios, one year after the acquisition, which will continue to improve: (at 31/12/2002) Gearing (1) 0.88 (1) Océane excluded from debt and equity Net debt / EBITDA 2.59 Cash flow cover 2.38 15
Slide 16: Above-forecast EPS
Consolidated 2002 Results ` Above-forecast EPS +83% 7.47 +43% Target 2002 5.23 € 6.40 4.08 € 1999 2001 2002 (Restated for exceptionals and goodwill amortisation, diluted for convertible bonds, before the impact of 1-for-4 bonus issue) 16
Slide 17: Overall dividend increased by 25%
Consolidated 2002 Results 14 February 2003: one-for-four bonus issue Overall dividend increased by 25% € 2000 2001 2002 Number of shares (million) 56.4 56.4 70.5 Proposed dividends 1.6 1.8 1.8 Payout rate * 46 % 39 % 31 % * Net profit excluding « non -recurring » items 195 258 410 used for calculati
Slide 18: Parent company financial statements 2002
2002 results Pernod Ricard SA, parent company financial statements (€m) 2001 2002 Operating profit (4) (27) Net financial profit 112 509 Net profit (75) 346 Strong growth in profit due to the increase in dividends received from subsidiaries (in particular the capital gains realised on the sale of Or
Slide 19: A performance well received by the markets
A performance well received by the markets 19
Slide 20: Share price performance vs CAC 40
31 /1 Performance 2 0 20 40 60 80 100 120 31 /20 140 /0 01 1 28 /20 /0 02 Share price 2 31 /20 /0 02 3 30 /20 /0 02 4 31 /20 /0 02 5 30 /20 /0 02 6 31 /20 /0 02 7 30 /20 /0 02 8 30 /20 /0 02 9 31 /20 /1 02 Pernod Ricard 100 0 30 /20 /1 02 1 31 /20 /1 02 2 31 /20 /0 02 1 28 /20 /0 03 2 CAC 40 100 31
Slide 21: Average monthly share price performance
31 /1 2 50 60 70 80 90 31 /20 /0 01 Performance 1 28 /200 /0 2/ 2 31 20 /0 02 Share price 3 30 /200 /0 4/ 2 31 20 /0 02 5 30 /200 /0 6/ 2 31 20 /0 02 7 30 /200 /0 8/ 2 30 200 /0 9/ 2 from 1 January 2002 to 30 April 2003 31 20 /1 02 0 30 /200 /1 1 2 Pernod Ricard 31 /20 /1 02 2 31 /200 /0 1/ 2 28 20
Slide 22: Performance since 1975
Share price Performance since 1975 Pernod Ricard share price / SBF 250 performance since 1975 (base 100, average adjusted share price) 2500 €80.20 2000 Adjusted average Pernod Ricard 1500 share price Average SBF 1000 index 500 €3.94 0 1975 1977 1979 1981 1983 1985 1987 1989 1991 1993 1995 1997 1999
Slide 23: 2003 Outlook
2003 Outlook i AA LA? = an coil a 6 23 Pernod Ricard
Slide 24: Q1 2003 sales
Wine & Spirits Q1 2003 sales 17% organic growth in Wine & Spirits sales Beginning-of-year performance in line with our buisness plan 24
Slide 25: Q1 2003 sales growth
Wine & Spirits Q1 2003 sales Satisfactory performances 713 644 + 10.6% €m Q1 02 Q1 03 Growth: + 10.6 % Organic growth: + 16.8 % Currency effect: - 10.9 % Consolidation effect: + 4.8 % 25
Slide 26: Volumes: Chivas Regal and Martell
Wine & Spirits Volumes ` Remarkable growth for Chivas Regal and Martell driven by: • positive effects of 2002 destocking • excellent performances in certain markets, notably in: - Chivas: Europe and Asia - Martell: UK and China ` Good first quarter for duty-free sales, despite a sharp slowdown in Ma
Slide 27: Volumes: growth drivers
Wine & Spirits Volumes Growth-drivers continue to gather momentum MAT 2003/2002 Volumes Q1 03/Q1 02 at end 03/2003 Amaro Ramazzotti +20.7% +17.7% The Glenlivet 13.7% 5.7% Jameson +7.2% +6.9% Jacob's Creek +5.0% +9.4% Havana Club +3.5% +11.0% 27
Slide 28: Volumes: French market
Q1 Sales 2003 Volumes French market: tough economic conditions in early 2003 Ricard wins market share, despite slowdown of market Clan Campbell : 7% growth in France, destocking at « borders » MAT 2003/2002 Volumes Q1 03/Q1 02 at end 03/2003 Clan Campbell -6.8% -3.6% Ricard -7.5% -1.4% Pastis 51 -27
Slide 29: Q1 sales by region
Wine & Spirits Sales by region 268 France + 0.3 % Europe + 16.8 % 230 Organic growth -1.4% 114 114 Organic growth 16.1% Consol. effect 1.8% Consol. effect 5.0% Currency effect - Currency effect -4.3% Q1 02 Q1 03 Q1 02 Q1 03 16% 38% 22% (€m) 24% Americas -11.4% 178 Rest of world + 40.6% 173 158 123 O
Slide 30: Sales by region commentary
Wine & Spirits Sales by region Excellent overall performance in Europe - Strong growth in Italy, Germany, UK, Greece, Czech Republic - Good increase in whisky sales in Spain Surging growth in Asia (Thailand, India, China…) - Strong rally for Royal Salute - Excellent performance for Chinese New Year
Slide 31: Consolidated Q1 sales
Q1 2003 sales Consolidated sales Major consolidation changes reflect core-business refocus on Wine & Spirits 1,191 - 37.8% 547 740 27 Others 644 713 €m Wine & Spirits Q1 02 Q1 03 Organic growth: + 8.9% Currency effect: - 6.7% Consolidation effect: - 40.1% 31
Slide 32: Outlook for 2003
Outlook for 2003 Wine & Spirits consolidation changes and exchange rates, 2002: Double digit net profit growth target (excl. Exceptionals and goodwill amortisation) >10% 440 419 (21) Impact of sale of non- alcohol businesses (€ m) 2002 2002 2003 Impact of EUR/USD fluctuations : + 0.10 USD = - 22 M€
Slide 33: Resolutions
Resolutions ; A Lt: = a coil a 6 33 Pernod Ricard
Slide 34: First resolution: approval of company financial statements
I – Ordinary Resolutions First resolution Approval of the Company financial statements for the year 2002 showing a profit of 345,778,498.05 euros 34
Slide 35: Second resolution: consolidated financial statements
I - Ordinary Resolutions Second resolution Approval of the consolidated financial statements for the year 2002 Discharge to the Board of Directors 35
Slide 36: Third resolution: appropriation of earnings
I - Ordinary Resolutions Third resolution Appropriation of earnings Source: Profit for the year 345,778,498.05 € Retained earnings brought forward 119,878,482.00 € Distributable earnings 465,656,980.05 € 36
Slide 37: Third resolution: appropriation
I - Ordinary Resolutions Third resolution Appropriation: Legal reserve 187.55 € Special long-term capital gains reserve 0.00 € Interim dividends 13,110,039.07 € Final dividends 113,761,306.73 € Capital expenditure charge 0.00 € Retained earnings carried forward 338,785,446.70 € Total distributed 465
Slide 38: Third resolution: distribution
I - Ordinary Resolutions Third resolution Distribution: Dividend per share 1.80 € Tax credit 0.90 € Gross dividend 2.70 € Payment date: 15 May 2003 Final dividend: 0.90 € per share (Total dividend of 1.80 € less interim dividend of 0.90 € paid on 14 January 2003 and on 5 March 2003 on the new shares
Slide 39: Third resolution: dividend history
I - Ordinary Resolutions Third resolution Dividend history: Net dividend Tax credit Gross dividend 1999 1.60 € 0.80 € 2.40 € 2000 1.60 € 0.80 € 2.40 € 2001 1.80 € 0.90 € 2.70 € 39
Slide 40: Fourth resolution: regulated agreements
I - Ordinary Resolutions Fourth resolution Approval of regulated agreements stated in the special report of the Statutory Auditors 40
Slide 41: Fifth resolution: transfer of head office
I - Ordinary Resolutions Fifth resolution Ratification of transfer of head office 41
Slide 42: Sixth resolution: co-opting of Lord Douro
I - Ordinary Resolutions Sixth resolution Ratification of the co-opting of Lord Douro as Director and replacing a Director who resigned during the year 42
Slide 43: Seventh resolution: Didier Pineau-Valencienne
I - Ordinary Resolutions Seventh resolution Appointment of Mr. Didier Pineau-Valencienne as Director for a term of six years 43
Slide 44: Eighth resolution: William Webb
I - Ordinary Resolutions Eighth resolution Appointment of Mr. William Webb as Director for a term of six years 44
Slide 45: Ninth resolution: Jean-Dominique Comolli
I - Ordinary Resolutions Ninth resolution Renewal of the appointment of Mr. Jean- Dominique Comolli as Director for a term of six years 45
Slide 46: Tenth resolution: Paul Ricard Company
I - Ordinary Resolutions Tenth resolution Renewal of the appointment of the Company Paul Ricard as Director for a term of six years, with Ms. Béatrice Baudinet as permanent representative 46
Slide 47: Eleventh resolution: Lord Douro
I - Ordinary Resolutions Eleventh resolution Renewal of the appointment of Lord Douro as Director for the term of six years 47
Slide 48: Twelfth resolution: Statutory Auditor
I - Ordinary Resolutions Twelfth resolution Resignation of company of chartered accountants Jean Delquié, incumbent Statutory Auditor, and appointment of company Deloitte Touche Tohmatsu as new incumbent Statutory Auditor for the remainder of the term of mandate of its predecessor 48
Slide 49: Thirteenth resolution: deputy Statutory Auditor
I - Ordinary Resolutions Thirteenth resolution Appointment of company BEAS as deputy Statutory Auditor to Deloitte Touche Tohmatsu 49
Slide 50: Fourteenth resolution: Directors' fees
I - Ordinary Resolutions Fourteenth resolution Total Directors' fees set at 528,000 € 50
Slide 51: Fifteenth resolution: treasury share purchase
I - Ordinary Resolutions Fifteenth resolution Authorisation for a period of eighteen months for Board of Directors to purchase treasury shares up to 10% of the share capital in order to: • Issue them to cover the exercise of equity entitlements (e.g. options) • Stabilise the share price • Sell or ex
Slide 52: Fifteenth resolution: purchase methods
I - Ordinary Resolutions Fifteenth resolution Purchase methods: via the market or otherwise • Maximum purchase price: 120 € • Minimum sales price: 40 € • Maximum total equity employed: 845,808,960 € • Board of Directors' powers • Cancel authorisation granted 31 May 2002 52
Slide 53: Sixteenth resolution: cancel treasury shares
II - Extraordinary Resolutions Sixteenth resolution Authorisation for the board to cancel treasury shares acquired by the company Maximum reduction of nominal share capital: 21,850,065.11 € Board of Directors' powers Term of authorisation: 24 months Cancel authorisation granted 31 May 2002 53
Slide 54: Seventeenth resolution: capital increase
II - Extraordinary Resolutions Seventeenth resolution Delegation of authority to the Board of Directors to carry out a capital increase once or more than once through share issues Reserved to subscribers to a company savings plan or a voluntary company savings partnership scheme (a French PPESV) Sup
Slide 55: Seventeenth resolution: beneficiaries
II - Extraordinary Resolutions Seventeenth resolution Beneficiaries of authorised capital increases: directly or through a company mutual fund – the subscribers to a company savings plan or a voluntary company savings partnership scheme set up jointly by the Company and the companies linked to it, a
Slide 56: Seventeenth resolution: free shares
II - Extraordinary Resolutions Seventeenth resolution Authority given to the Board of Directors to allocate free shares to these beneficiaries Term of authorisation annulling the delegation of similar authority granted on 3 May 2001: 5 years Limit of capital increase: 10,925,032.56 € 56
Slide 57: Seventeenth resolution: share price
II - Extraordinary Resolutions Seventeenth resolution ` Price of shares to be issued: the average of the first prices quoted during the 20 preceding trading sessions with, as the case may be, application of a reduction of 20% or 30% in the case of a voluntary company savings partnership scheme ` Aut
Slide 58: Eighteenth resolution: capital increase
II - Extraordinary Resolutions Eighteenth resolution Delegation of authority given to the Board of Directors to carry out a capital increase By issue of shares or securities giving a right to shares, apart from preferred shares Or by capitalisation of premiums – reserves – earnings Term of delegatio
Slide 59: Eighteenth resolution: limit of issues
II - Extraordinary Resolutions Eighteenth resolution Limit of issues • In overall par value of shares: 200,000,000 € • In par value of debt instruments: 1,500,000,000 € • Added to limits of operations carried out pursuant to the following resolution Authority conferred on the Board to set down condi
Slide 60: Eighteenth resolution: waiver and authority
II - Extraordinary Resolutions Eighteenth resolution And express waiver by shareholders to their pre-emption right to securities to which the securities issued grant a right Other authority conferred on the Board of Directors: •To charge costs of capital increases to premiums •To decide on non-negot
Slide 61: Nineteenth resolution: capital increase
II - Extraordinary Resolutions Nineteenth resolution Delegation of authority to the Board of Directors to carry out a capital increase • By issue of shares or securities giving a right to shares, except for preferential shares Term of delegation: 26 months Limit of issues: • In overall par value of
Slide 62: Nineteenth resolution: suppression of rights
II - Extraordinary Resolutions Nineteenth resolution • Allocation to these limits the operations carried out pursuant to the previous resolution Suppression of the preferential subscription right of shareholders to securities to be issued by virtue of this delegation And express waiver by shareholde
Slide 63: Nineteenth resolution: Board authority
II - Extraordinary Resolutions Nineteenth resolution Authority conferred on the Board of Directors to: • Establish the conditions of issue • Especially in case of issue of securities intended as payment for securities brought in by an exchange offer • Allocate the costs of capital increases to premi
Slide 64: Twentieth resolution: suspension during takeover bid
II - Extraordinary Resolutions Twentieth resolution Suspension of delegation of authority conferred by the two preceding resolutions During a takeover bid or an exchange offer Unless the issue or issues have been approved in principle prior to registration of the offer Term of authorisation: until t
Slide 65: Twenty-first resolution: legal formalities
II - Extraordinary Resolutions Twenty-first resolution Powers required for legal formalities 65
Slide 66: Voting of Resolutions
Voting of Resolutions AWA Lt: = aR a a 66 Pernod Ricard
Slide 67: First resolution: financial statements
I - Ordinary Resolutions First resolution Approval of the Company financial statements 67
Slide 68: Second resolution: consolidated financial statements
I - Ordinary Resolutions Second resolution Approval of the consolidated financial statements Discharge to the Board of Directors 68
Slide 69: Third resolution: appropriation of earnings
I - Ordinary Resolutions Third resolution Appropriation of earnings 69
Slide 70: Fourth resolution: regulated agreements
I - Ordinary Resolutions Fourth resolution Approval of the regulated agreements 70
Slide 71: Fifth resolution: transfer of head office
I - Ordinary Resolutions Fifth resolution Ratification of transfer of head office 71
Slide 72: Sixth resolution: co-opting of Lord Douro
I - Ordinary Resolutions Sixth resolution Ratification of the co-opting of Lord Douro as Director 72
Slide 73: Seventh resolution: new Director
I - Ordinary Resolutions Seventh resolution Appointment of a new Director: Mr. Didier Pineau-Valencienne 73
Slide 74: Eighth resolution: new Director
I - Ordinary Resolutions Eighth resolution ` Appointment of a new Director: Mr. William Webb 74
Slide 75: Ninth resolution: Director renewal
I - Ordinary Resolutions Ninth resolution Renewal of the appointment of a Director: Mr. Jean-Dominique Comolli 75
Slide 76: Tenth resolution: Director renewal
I - Ordinary Resolutions Tenth resolution Renewal of the appointment of a Director: Paul Ricard Company - permanent representative Ms. Béatrice Baudinet 76
Slide 77: Eleventh resolution: Director renewal
I - Ordinary Resolutions Eleventh resolution Renewal of the appointment of a Director: Lord Douro 77
Slide 78: Twelfth resolution: Statutory Auditor
I - Ordinary Resolutions Twelfth resolution Resignation of incumbent Statutory Auditor and appointment of a new incumbent Statutory Auditor in replacement: Company Deloitte Touche Tohmatsu 78
Slide 79: Thirteenth resolution: deputy Statutory Auditor
I - Ordinary Resolutions Thirteenth resolution Appointment of deputy Statutory Auditor: Company BEAS 79
Slide 80: Fourteenth resolution: Directors' fees
I - Ordinary Resolutions Fourteenth resolution Directors’ fees 80
Slide 81: Fifteenth resolution: purchase treasury shares
I - Ordinary Resolutions Fifteenth resolution Authorization for Board of Directors to purchase treasury shares of the Company 81
Slide 82: Sixteenth resolution: cancel treasury shares
II - Extraordinary Resolutions Sixteenth resolution Authorization for Board of Directors to cancel treasury shares acquired by the Company 82
Slide 83: Seventeenth resolution: employee capital increase
II - Extraordinary Resolutions Seventeenth resolution Delegation of authority conferred on the Board of Directors to carry out a capital increase by issue of shares reserved for subscribers to a company savings plan and/or a voluntary Company savings partnership scheme (French PPESV) 83
Slide 84: Eighteenth resolution: capital increase with preferential rights
II - Extraordinary Resolutions Eigthteenth resolution Delegation of authority conferred on the Board of Directors to carry out a capital increase with preferential rights upheld 84
Slide 85: Nineteenth resolution: capital increase without preferential rights
II - Extraordinary Resolutions Ninteenth resolution Delegation of authority conferred on the Board of Directors to carry out a capital increase with preferential rights suppressed 85
Slide 86: Twentieth resolution: suspension of powers during takeover bids
II - Extraordinary Resolutions Twentieth resolution Suspension of powers granted to the Board of Directors, to increase share capital during takeover bids 86
Slide 87: Twenty-first resolution: powers
II - Extraordinary Resolutions Twenty-first resolution Powers 87
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