Scandinavian Tobacco Group A/s · OMXCOP:STG
Scandinavian Tobacco Group A/s — Q1 2023 Earnings Presentation
21 slides from Scandinavian Tobacco Group A/s's earnings presentation, May 18, 2023
Slide 1: Investor Presentation – First Quarter Results 2023
CREATING MOMENTS OF ENJOYMENT Investor Presentation FIRST QUARTER RESULTS 2023 18 MAY 2023
Slide 2: Corporate Summary
A GLOBAL LEADER IN CIGARS CORPORATE SUMMARY • 200 LEADING BRANDS, 11 PRODUCTION SITES Market cap Share price Shares Outstanding • NO. 1 HANDMADE CIGAR LEADER IN USA DKK 10.5 billion DKK 122 86.4 million • NO. 1 MACHINE-ROLLED CIGAR LEADER IN EUROPE • ALMOST 1 MILLION ONLINE CUSTOMERS IN USA Major Sh
Slide 3: Agenda
AGENDA 1. Q1 2023 Highlights – Niels Frederiksen, Chief Executive Officer 01 NIELS FREDERIKSEN Chief Executive Officer 2. Business Updates – Niels Frederiksen, Chief Executive Officer 3. Our Commercial Divisions – Marianne Rørslev Bock, Chief Financial Officer 02 MARIANNE RØRSLEV BOCK 4. Group Finan
Slide 4: Q1 2023 Highlights
Q1 2023 HIGHLIGHTS Q1 2023 Q1 2022 • Steady financial performance as expected off the back of a challenging year in 2022 Net Sales Growth 1.3% 2.9% • 2023 guidance maintained EBITDA margin before special items 24.1% 27.4% • Acquisition of Alec Bradley (Q1) and XQS (Q2) FCF before acquisitions (DKK)
Slide 5: Rolling Towards 2025 – Our Road Ahead
ROLLING TOWARDS 2025 OUR ROAD AHEAD Be The Undisputed & Sustainable Leader In Cigars
Slide 6: Our Road Ahead: M&A Embedded into the Business Structure
OUR ROAD AHEAD M&A EMBEDDED INTO THE BUSINESS STRUCTURE • Continuously searching for opportunities to grow the business and strengthen the brand portfolio • Strategic screenings encompass both cigar and Next Generation product categories • STG M&A playbook allows for a detailed execution plan to ens
Slide 7: Growth Opportunities
GROWTH OPPORTUNITIES GROWTH INCUBATOR • Growth Incubator team established to research and test the new era of modern ritualistic enjoyment The Group’s ambition is to grow through a combination of additional acquisitions, geographical expansion and further • Critical to remain relevant, competitive a
Slide 8: Our Road Ahead with Sustainability
2023 SUSTAINABILITY AMBITIONS: OUR ROAD AHEAD WITH SUSTAINABILITY 2023 AMBITIONS ENVIRONMENT SOCIAL GOVERNANCE • Develop concrete targets for SBTi • Review ongoing community initiatives & develop • Roll out updated Code of Conduct to all • Reduce Scope 1 and 2 carbon emissions by >4.2% more impactfu
Slide 9: Our Divisions
OUR DIVISIONS 9
Slide 10: Europe Branded
EUROPE BRANDED NET SALES 750 10% Q1 Highlights 5% • Organic net sales growth of 8% driven by smoking tobacco and pricing in all product categories 500 0% • EBITDA margin primarily driven by changes in market and product mix and cost inflation versus Q1 2022 250 -5% • Market volume down by approx. 2%
Slide 11: North America Branded & ROW
NORTH AMERICA BRANDED & ROW NET SALES 1,000 10% Q1 Highlights 750 5% • Organic net sales growth was negative by 9% compared with the exceptional strong Q1 2022 and as 500 0% price increases couldn’t offset a decline in volumes of handmade cigars. • Handmade cigars in the US continue to decline more
Slide 12: North America Online & Retail
NORTH AMERICA ONLINE & RETAIL NET SALES 1000 2% 750 -1% Q1 Highlights 500 -3% • Organic net sales increased by 1%, the first increase in 8 quarters • Retail deliver solid growth driven by store openings. Retail accounts for close to 9% of net sales 250 -6% • The active online customer file continues
Slide 13: Group Financials
SCANDINAVIAN TOBACCO GROUP
Slide 14: Long Term Trend - EBITDA Margins Q1 2018-Q1 2023
LONG TERM TREND - EBITDA MARGINS Q1 2018-Q1 2023 THE GROUP % % NAOR 30 20 25 15 20 15 10 10 5 5 0 0 Q1 18 Q1 19 Q1 20 Q1 21 Q1 22 Q1 23 Q1 18 Q1 19 Q1 20 Q1 21 Q1 22 Q1 23 NABROW EUROPE BRANDED % % 50 30 25 40 20 30 15 20 10 10 5 0 0 Q1 18 Q1 19 Q1 20 Q1 21 Q1 22 Q1 23 Q1 18 Q1 19 Q1 20 Q1 21 Q1 22
Slide 15: Q1 2023 Results
Q1 2023 Q1 2022 Q1 2023 RESULTS Organic net sales growth -0.8% -1.7% DKK million Gross margin 49.9% 52.6 % Q1 2023 Q1 2022 FY 2022 FY 2021 Net sales 1,963 1,938 8,762 8,233 OPEX ratio 25.8% 25.2% Gross profit (before special items) 979 1,019 4,307 4,113 OPEX -506 -488 -2,037 -1,911 EBITDA margin 24.
Slide 16: Net Debt and Leverage
NET DEBT AND LEVERAGE NIBD AND LEVERAGE • Net Interest-bearing Debt (NIBD) increased by DKK 787 5,000 3.5 million to DKK 4,416 million versus year-end 2022. 4,416 4,000 3.0 The development is explained by cash flow from 3,629 • 3,274 3,266 3,446 operations, capital allocations and acquisition of Ale
Slide 17: 2023 Guidance Maintained
2023 GUIDANCE MAINTAINED* NET SALES EBITDA MARGIN FREE CASH FLOW ADJUSTED EPS Before special items Before acquisitions In the range of In the range of In the range of In the range of DKK 1.2–1.4 billion DKK 14.5 – 16.5 DKK 9.0–9.3 billion 24-25% * Guidance and assumption are based on current exchang
Slide 18: Questions and Answers
FIND OUT MORE QUESTIONS AND ANSWERS Annual Report 2022 Our 2022 Annual Report addresses our financial performance, strategic execution and other important aspects of our business operations. We are happy to take any questions from the audience now. Sustainability Report 2022 Our Sustainability Repor
Slide 19: Event Calendar & Contact
EVENT CALENDAR & CONTACT APR-JUN JUL-SEP SEPTEMBER OCT-DEC 17 May 2023 29 August 2023 8 November 2023 Q1 interim report H1/Q2 interim report Q3 interim report 6-8 June 2023 Global Consumer conference, Paris Torben Sand Eliza Dabbagh Scandinavian Tobacco Group A/S Director of IR & Communication IR an
Slide 20: Steady Growth in 5 Year Financial Performance
STEADY GROWTH IN 5 YEAR FINANCIAL PERFORMANCE ORGANIC EBITDA GROWTH EBITDA MARGIN ADJUSTED EPS % % DKK Share 20 30 20 15 25 15 20 10 15 10 5 10 0 5 5 -5 0 0 2018 2019 2020 2021 2022 2018 2019 2020 2021 2022 2018 2019 2020 2021 2022 FREE CASH FLOW RETURN ON INVESTED CAPITAL DKK million DKK million CA
Slide 21: Thank You
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