Coca-cola Bottlers Japan Holdings Inc. · TSE:2579
Coca-cola Bottlers Japan — Coca-Cola East Japan — Q2 2015 Earnings Presentation
29 slides from Coca-cola Bottlers Japan's earnings presentation, Aug 7, 2015
Slide 1: Coca-Cola East Japan Q2 & YTD 2015 Earnings Presentation
Coca-Cola East Japan Q2 & YTD 2015 Earnings Presentation Calin Dragan, CEO Michael Coombs, CFO August 7, 2015 www.ccej.co.jp (Posted to CCEJ Website August 6, 2015)
Slide 2: Forward-Looking Statements
Forward-Looking Statements Q2 & YTD 2015 The plans, performance forecasts, and strategies appearing in this material are based on the assumptions and judgment of the management of Coca-Cola East Japan Co. Ltd. (CCEJ) in view of data obtained as of the date this material was released. These forecasts
Slide 3: Coca-Cola Zero Taste Challenge (VIDEO)
Coca-Cola Zero Taste Challenge (VIDEO) Q2 & YTD 2015 (TRY! #Kiki Coke – Coca-Cola Zero Taste Challenge Commercial Film) http://www.cokezero.jp/movie/#movie09 3
Slide 4: Coca-Cola Zero Taste Challenge
Coca-Cola Zero Taste Challenge Q2 & YTD 2015 What? Is this really ZERO? Taste and then slide cover off can to • June – July promotion discover if it was Coca-Cola or Coke Zero • Sampling ~100K cans Enjoy! • Nine events in CCEJ territory 4
Slide 5: Q2 & YTD 2015 Earnings Presentation
Q2 & YTD 2015 Earnings Presentation Q2 & YTD 2015 Introduction • Overview and Key Messages • Transforming our Business Second Quarter and Year-to-Date Results • Share, Volume and Financial Results Rest-of-Year Outlook • Marketing Activities and Key Milestones 5
Slide 6: Summary of First Half Results
Summary of First Half Results Q2 & YTD 2015 YTD comparable* operating income improved by 3.8 billion yen vs. prior year, including cycling the impact of the accounting policy change in Q1 2014. Ongoing delivery of supply chain synergies, partially offset by increased expenses related to employee o
Slide 7: Q2 & YTD 2015 Results
Q2 & YTD 2015 Results www.ccej.co.jp
Slide 8: Transforming the Business in 2015
Transforming the Business in 2015 Q2 & YTD 2015 Rapid organizational transformation & integration continues; acquired Sendai Coca-Cola Bottling Company, consolidated eight subsidiaries into FV East Japan. Two new production lines operational in Q2 (Ibaraki, Ebina) Phase One of ERP System operatio
Slide 9: CokeOne+ ERP System Deployment
CokeOne+ ERP System Deployment Q2 & YTD 2015 アプリケーションマップ(2012/11) レガシー J-SCALE個別 インフラ 人間系の受注 EDI関連 訪問 テレ受注 FAX受注 Web（Ｉｎｆｏmart） 弊社受信 DIAS 共通機能 BI/CRM/SFA関連 MOS TCCS サーバ（コールセンター） Web EOSシステム センター配送照合システ REDサーバ LBCクロス（溝口DC) ム 統合マスター管理 レガシーマスター管理（Tonedb01） ｸﾗｲｱﾝﾄ ASN 受注KPI管理 受注ﾃﾞｰﾀ作成 EOSデータ管理 未開拓顧客検索ツール
Slide 10: Volume Performance in the First Half
Volume Performance in the First Half Q2 & YTD 2015 Sequential Improvement 1H Reported Volume by Quarter during Q2 after Tax Rise Q2 Reported Volume by Month 1H volume Q2 Highlights +5.4% (+0.1%*) • Sendai acquisition April 1 • Strong volume in April Cycling prior cycling C-tax last year +17% year gr
Slide 11: Balancing Volume & Value
Balancing Volume & Value Less Promotional Activities in June Led to Volume Decline Q2 & YTD 2015 CCEJ Historic Weekly Volume Shipment Trends • Less promotional activities in Example: Drug & Discounter Channel June vs. past trends, in line with our ongoing price, terms & conditions (PTC) focus • This
Slide 12: Connecting with the Consumer
Connecting with the Consumer Q2 & YTD 2015 Q2 Coca-Cola Bottle 100th Anniversary Coca-Cola Life Kiki Coke Taste Challenge Share-a-Coke Coca-Cola Aluminum Contour Bottle The great taste of Coca-Cola Zero Q2 Customer-Exclusive Branded Products Georgia European Renewal Georgia Private Reserve Concept C
Slide 13: Slight Share Loss Cycling Prior Year Growth
Slight Share Loss Cycling Prior Year Growth Q2 & YTD 2015 Volume & value share growth in 6 of 7 quarters 2015 vs. Prior Year Market Share* Q2 YTD Share gains in cola, teas, water; Volume -0.3 -0.1 Challenges in flavored sparkling Value -0.4 -0.1 June share reflects less promotional activity Volume S
Slide 14: Volume Performance by Channel
Volume Performance by Channel Q2 & YTD 2015 Q2 Volume by Channel Channel Volume Growth (% of total) Including Sendai Others Supermarket 11% (SM) 22% Vending (VM) Drug & 27% Discounter Eating & Convenience Store (CVS) (D&D) Drinking 15% 12% 13% vs. Prior Year CVS D&D Nat’l SM Local SM VM Eat & Drink
Slide 15: Volume Performance by Category
Volume Performance by Category Q2 & YTD 2015 Q2 Volume by Category Category Volume Growth (% of total) Juice Including Sendai Others 4% Sparkling 12% (SSD) 26% Coffee 16% Teas Sports Water 21% 11% 10% vs. Prior Year NST Water Coffee Sparkling Sports Juice Q2 2015 +16% +12% +14% +6% +9% +22% Total Vo
Slide 16: Q2 & YTD 2015 Financial Results
Q2 & YTD 2015 Financial Results www.ccej.co.jp
Slide 17: Drivers of Second Quarter Operating Income
Drivers of Second Quarter Operating Income Q2 & YTD 2015 +247 In MM JPY -671 -919 +753 +1,385 Other Depreciation -511 DME** OPEX Subsidiaries vs. PY GP Impact Supply Chain • “Big Bet” brand • In line with plan. • FV East Japan • COGS: -200 of Mix & Vol Synergies launches Benefit vs prior • Sendai CC
Slide 18: Second Quarter 2015 Results
Second Quarter 2015 Results Q2 & YTD 2015 • Balanced volume & revenue performance • Improving gross margin driven by manufacturing efficiency • Comparable SG&A increase led by continued marketing investment & people costs • Q2 tax reflects deferred tax for consolidation of subs (FVEJ) 2015 Q2 2015 Q
Slide 19: Drivers of First Half Operating Income
Drivers of First Half Operating Income Q2 & YTD 2015 In MM JPY Supply Chain Synergies • Overall below GP Impact plan due to Q2 DME** of Mix & Vol expenses related • “Big Bet” brand 2,640 to inventory • +0.1% volume launches management cycling PY +2.6% volume growth after ERP rollout • VM locations +
Slide 20: First Half 2015 Results
First Half 2015 Results Q2 & YTD 2015 • Balanced volume and revenue performance • Improving gross margin driven by manufacturing efficiency • COGS and SG&A benefit from cycling Q1 2014 accounting policy change • Q2 tax reflects additional deferred tax for consolidation of subs (FVEJ) 2015 1H 2015 1H
Slide 21: Second Half 2015 Outlook
Second Half 2015 Outlook www.ccej.co.jp
Slide 22: Coca-Cola Summer Campaign
Coca-Cola Summer Campaign Q2 & YTD 2015 Transform the summer Transform yourself 22
Slide 23: Second Half Outlook; Reasons to Believe
Second Half Outlook; “Reasons to Believe” Q2 & YTD 2015 Q3 the most important quarter of the year We are strengthening Marketing & Execution programs in key channels – Solid marketing calendar for second half of 2015 – Targeted promotional activities that respect PTC guidelines Increased focus on
Slide 24: Key Milestones in the Second Half
Key Milestones in the Second Half Q2 & YTD 2015 Continued stabilization and utilization of new ERP system in Q3; management of stable product supply as we fully shift to new system. Two new production lines (Iwatsuki) to be commissioned in 2H Additional Bottle Can capacity (Tokai) to be commissio
Slide 25: APPENDIX
APPENDIX \ 100 YEARS OF THE COCA-COLA BOTTLE CxLbela Cast Japan DAFT —-AhY eo NRRL www.ccej.co.jp
Slide 26: CCEJ One+ Roadmap for Growth
CCEJ One+ Roadmap for Growth Q2 & YTD 2015 2018- Tokyo Olympic Games & Beyond 2016-2017 Accelerating 2015-2016 Performing 2012-2014 Norming Meet & exceed Approaching world-class Forming & Storming 2012-2013 Refine & global bottler bottler levels optimize new performance Forming Define & deploy new b
Slide 27: The Coca-Cola System
The Coca-Cola System Q2 & YTD 2015 A powerful partnership driving growth of the Coca-Cola business The Coca-Cola system in Japan consists of the Coca-Cola (Japan) Company (CCJC), bottlers and other related companies. CCJC, as the franchise owner, is responsible for supplying concentrate and beverage
Slide 28: Glossary of Frequently Used Terms
Glossary of Frequently Used Terms Q2 & YTD 2015 CDE Abbreviation of Cold Drink Equipment. Vending machines, coolers and beverage dispensers, etc. Coolers The equipment with Coca-Cola’s logos which keeps beverages at an appropriate temperature (chilled and/or hot) for immediate consumption, and ready
Slide 29: THANK YOU
THANK YOU Coca-Cola East Japan Q2 &YTD 2015 Earnings Presentation August 7, 2015 <Inquiries> Investor Relations Coca-Cola East Japan ir@ccej.co.jp +81-3-5575-3797 http://investor.ccej.co.jp/ www.ccej.co.jp