Remy Cointreau Sa · EURONEXT:RCO
Remy Cointreau Sa — H1 2016-17 Earnings Presentation
33 slides from Remy Cointreau Sa's earnings presentation, Nov 24, 2016
Slide 1: Half-Year Results 2016-17
Half-Year Results 2016-17 (period ended 30 September 2016) 24 November 2016
Slide 2: Introduction
Introduction FRANÇOIS HERIARD DUBREUIL CHAIRMAN 24 November 2016
Slide 3: L’Odyssée d’un Roi
L’Odyssée d’un Roi Louis XIII reached a record price of $558,000 at an auction of three exceptional L’Odyssée d’un Roi pieces at Sotheby’s 24 November 2016
Slide 4: Key figures (at 30 September 2016)
Key figures (at 30 September 2016) Change Reported Organic • Sales €513.4m 2.5% 4.1% • of which Group’s own brands €457.3m 3.2% 5.1% • Current operating profit €123.9m 15.9% 7.0% • Current operating margin 24.1% +270 bps +60 bps • Net profit (Group share) €76.0m 14.8% 5.4% • Net profit (excluding no
Slide 5: Business review
Business review VALERIE CHAPOULAUD-FLOQUET CHIEF EXECUTIVE OFFICER 24 November 2016
Slide 6: Robust half-year performance in line with our full-year targets
Robust half-year performance in line with our full-year targets Sales up 4.1% in organic terms and up 2.5% on a reported basis : • Led by the Group’s brands (up 5.1%): Rémy Martin, Cointreau, Metaxa and Islay Spirits • Strong performance in the United States and return to growth in Greater China and
Slide 7: Group sales
Group sales €m H1 15/16 Organic Currency H1 16/17 Reported growth: +2.5% 513.4 500.7 +4.1% -1.6% 24 November 2016
Slide 8: Organic growth by division
Organic growth by division Liqueurs & Group Partner Group Rémy Martin Spirits Brands Brands total 7,0% +5.1% +5.1% +5.1% 5,0% +4.1% 3,0% 1,0% -1,0% -3,0% -3.1% -5,0% 24 November 2016
Slide 9: Breakdown of sales (1)
Breakdown of sales (1) By division By region €513.4m Americas Liqueurs & Partner 43% (+4 pts) Spirits Brands 26% (=) 11% (=) Europe/ Asia M. East/ Pacific Africa 25% (-3 pts) 32% (-1 pt) Rémy Martin 63% (=) 24 November 2016
Slide 10: Breakdown of sales (2)
Breakdown of sales (2) Rémy Martin Liqueurs & Spirits €322.5m €134.8m Americas Americas 51% (+6 pts) 39% (=) Asia Europe/ Asia Europe/ Pacific M. East/ Pacific M. East/ 10% (=) Africa 34% (-4 pts) Africa 51% (=) 15% (-2 pts) 24 November 2016
Slide 11: Current operating profit
Current operating profit Reported growth: 15.9% (€m) Currency Volume/ Price/ A&P Other impact mix mix +17.8 +0.8 -6.3 -4.7 123.9 +9.4 107.0 Organic +7.0% up €7.5m Sept. 15 Sept. 16 COP/sales: 21.4% COP/sales: 24.1% (Org: 22.0%) 24 November 2016
Slide 12: Net profit
Net profit (€m) Net profit excluding non-recurring items Net profit (Group share) Reported +11.8% Reported +14.8% Organic change: +2.7% Organic change: +5.4% 76.6 76.0 68.6 66.3 September September September September 2015 2016 2015 2016 24 November 2016
Slide 13: House of Rémy Martin
House of Rémy Martin • Organic sales growth of 5.1% (volumes down 2.2%) • United States: solid momentum continues Sales (€m) • Greater China: renewed growth in sales, 450 -10.4%* -13.4%* -3.1%* +5.1%* buoyed by superior qualities 327.2 322.5 313.1 • EMEA: UK robust and return to growth in 300 276.8
Slide 14: Rémy Martin: marketing initiatives
Rémy Martin: marketing initiatives Carte Blanche à Baptiste Loiseau limited edition New Rémy Martin XO bottle Limited edition by Vincent Leroy 24 November 2016
Slide 15: Louis XIII: marketing initiatives
Louis XIII: marketing initiatives Auction of three L’Odyssée d’un Roi decanters First LOUIS XIII store opening in Beijing LOUIS XIII LE MATHUSALEM 24 November 2016
Slide 16: House of Rémy Martin
House of Rémy Martin Current operating profit (€m) Reported growth: +18.7% Currency Volume/ Price/ Other A&P impact mix mix +12.6 +1.5 -4.2 -2.2 101.9 +8.3 85.9 Organic +9.1% up €7.7m Sept. 15 Sept. 16 COP/sales: 27.4% COP/sales: 31.6% (Org:28.5%)
Slide 17: Liqueurs & Spirits
Liqueurs & Spirits • Organic sales growth of 5.1% (volumes up 5.1%) Cointreau Sales (€m) • Solid growth, driven by the three regions +9.9%* +8.7%* -8.3%* +5.1%* • Ongoing strength in the United States; 150 gradual improvement in Western Europe; 134.8 122.1 130.1 China becoming a growth driver 114.2
Slide 18: Liqueurs & Spirits: marketing initiatives
Liqueurs & Spirits: marketing initiatives Cointreau limited edition: #1Orange1Tree New packaging for METAXA 12 STARS “Don’t Drink it, Explore it” campaign with explorer Mike Horn Cointreau at the London Cocktail Week 24 November 2016
Slide 19: Liqueurs & Spirits
Liqueurs & Spirits Current operating profit (€m) Reported growth: +13.7% Currency Volume/ Price/ Other A&P impact mix mix +6.9 -0.7 -2.9 -1.2 27.4 +1.2 24.1 Organic +8.6% up €2.1m Sept. 15 Sept. 16 COP/sales: 18.5% COP/sales: 20.3% (Org: 19.1%) 24 November 2016
Slide 20: Partner Brands
Partner Brands • Organic sales decline of 3.1% (volumes up 3.3%) Sales (€m) • Champagne sales declined (distribution agreement for Piper and Charles Heidsieck +9.9%* +6.8%** -8.3%* -3.1%* expired) 150 • Double-digit growth in other partner brands 110.5 in Europe, Middle East & Africa 100 65.5 57.6 5
Slide 21: Partner Brands
Partner Brands • Current operating profit: €2.7m (organic change: -15.8%) • Decline in current operating profit linked to EBIT (€m) the fall in champagne sales 6 +10.3%* +13.5%** 41.2%* -15.8%* 4.5 3.9 4 3.3 2.7 2 0 Sept 2013 Sept 2014 Sept 2015 Sept 2016 *Organic growth; **Proforma excluding effect
Slide 22: Financial results
Financial results LUCA MAROTTA CHIEF FINANCIAL OFFICER 24 November 2016
Slide 23: Current operating profit
Current operating profit Sept. Sept. Reported Organic (€m) 2016 2015 change change Sales 513.4 500.7 2.5% 4.1% Gross profit 339.1 317.3 6.8% 5.2% As % 66.0% 63.4% 260 bps 60 bps Sales and marketing expenses (175.3) (173.3) 1.1% 3.4% Administrative expenses (40.4) (37.6) 7.2% 8.0% Other income & expe
Slide 24: Current operating profit
Current operating profit Reported COP/sales: +270 bps +210 bps 24.1% +60 bps -50 bps +50 bps 21.4% Organic COP/sales: +60 bps Sept. 15 Gross A&P Distribution/ Currency Sept. 16 COP/sales profit Others impact COP/sales 24 November 2016
Slide 25: Net profit
Net profit (€m) 2016 2015 Current operating profit 123.9 107.0 Other operating income (expenses) - (0.1) Operating profit 123.9 106.9 Net financial income (charges) (15.5) (15.1) Pre-tax profit 108.4 91.8 Taxes (32.3) (25.7) Tax rate 29.8% 28.0% Share in profit (loss) of associate companies (0.1) 0.
Slide 26: Net debt/cash flow
Net debt/cash flow (€m) 2016 2015 Change Opening net financial debt (1 April) (458.2) (466.6) 8.4 Gross operating profit (EBITDA) 134.0 118.0 16.0 WCR of eaux-de-vie and spirits in ageing process (31.5) (24.0) (7.5) Other working capital items (76.3) (66.0) (10.3) Capital expenditure (18.9) (11.9) (
Slide 27: Net financial income (charges)
Net financial income (charges) (€m) 2016 2015 Gross debt servicing costs (11.5) (12.2) Depreciation (OCEANE bond) (0.2) - Sub-total (11.7) (12.2) Net currency gains (losses) (1.4) (0.8) Other financial expenses (net) (2.4) (2.1) Net financial income (charges) (15.5) (15.1) 24 November 2016
Slide 28: Foreign exchange: hedging impact
Foreign exchange: hedging impact 1.34 Average €/$ rate 1.30 Hedged rate 1.31 1.24 1.23 1.27 1.14 1.11 1.12 1.10 2013/2014 2014/2015 2015/2016 2015/2016 2016/2017 March March September March September 24 November 2016
Slide 29: Balance sheet at 30 September 2016
Balance sheet at 30 September 2016 Assets Liabilities (€m) Sep as % Sep as % Sep as % Sep as % 2016 2015 2016 2015 Non- Shareholders’ 880 35% 878 39% 1,186 48% 1,075 47% current equity assets Current 1,382 56% 1,342 59% Current and assets non-current 628 25% 690 31% liabilities o/w inventories 1,101
Slide 30: Key events during the period
Key events during the period • 14 June 2016 Vigeo Eiris prize: 2016 Top Performers award ‘Responsible supply chain management: sustainable supplier relations’ • 26 July 2016 Ordinary dividend of €1.60 per share approved at the AGM (with an option for payment to be made fully in shares). 83% of votin
Slide 31: Subsequent events
Subsequent events ■ 14 October 2016 Announced plans to form a joint venture with Lucas Bols for the global activities of the Passoã brand ■ 27 October 2017 Entered into exclusive negotiations to acquire Distillerie du Domaine des Hautes Glaces 24 November 2016
Slide 32: 2016-17 full-year outlook
2016-17 full-year outlook • A strong H1 2016-17, in line with Group forecasts • Rémy Cointreau anticipates growth in current operating profit over financial year 2016-17, assuming constant exchange rates and consolidation scope. 24 November 2016
Slide 33: Q&A
@) REMY COINTREAU Q&A 24 November 2016