Coca-cola Bottlers Japan Holdings Inc. · TSE:2579
Coca-cola Bottlers Japan — Coca-Cola West Company — Q3 2016 Earnings Presentation
44 slides from Coca-cola Bottlers Japan's earnings presentation, Nov 1, 2016
Slide 1: Results briefing for the 3rd quarter of Fiscal Year ending December 2016
Results briefing for the 3rd quarter of Fiscal Year ending December 2016 November 1, 2016 Coca-Cola West Company, Limited (2579) [Contact]Planning Department (IR team) TEL 092-641-8774 FAX 092-632-4304 [URL] http: //www.ccwest.co.jp/ [E-mail] koji-nakagawa@ccwest.co.jp
Slide 2: Agenda
Agenda I. Account settlement for Q3 II. Activity Plans for Q4 and Full-year [Reference] Q3 (July-Sep) financial results Trend of OTC market share Mix by brand/by channel Sales update on vending machines by channel Q3 Actual sales volume (by channel and by package) Q4 Volume target Performance trend
Slide 3: I. Account settlement for the 3rd quarter
I. Account settlement for the 3rd quarter 2
Slide 4: Q1 YTD Sales Volume (Jan-Sep)
Coca-Cola business Q1 YTD Sales Volume (Jan-Sep) Vs. Plan ・ Sales volume from Jan to March closed exceeding the plan by 1.1%. ・ Partly attributable to incorporating Shikoku CCBC, Jan-Sep volume turned positive by 10.0%. Vs. PY ・ CCW volume for Jan-Sep YTD was a positive 4.8%. [Sales volume] Actual V
Slide 5: Sales volume by channel
Coca-Cola business Sales volume by channel Vs. Plan ・ All channels finished exceeding the volume plans. ・ Volume in Supermarket and Convenience Store turned positive both in July-Sep and in Jan- Sep YTD, partly contributed by the sales of new products launched after March. Vs. PY ・ Sales volume of h
Slide 6: Sales volume by package
Coca-Cola business Sales volume by package Vs. Plan ・ Sales volume of key packages exceeded the plans. ・ Highly profitable SS PET grew ahead of LS PET. ・ New product of Georgia Café Bottle Coffee (950ml PET) and Coca-Cola 1.0 L PET Vs. PY contributed to the growth of Midi PET. ・ Sales volume of CAN
Slide 7: Sales volume by brand
Coca-Cola business Sales volume by brand Vs. Plan ・Core 8 brands closed exceeding the plan by 1.4%. ・ Georgia outperformed PY by 6.2% driven by the sales contribution of new products. ・ Sokenbicha and Aquarius finished positive from PY in July-Sep, outperforming PY even Vs. PY in Jan-Sep YTD. ・ Ayat
Slide 8: Status of Revenue per case
Coca-Cola business Status of Revenue per case ■Revenue per case outperformed PY in Chain store, Vending and Retail. → Revenue per case in Q3 made improvements compared with 1H. → Supermarket, Drug store and Discounter began to see impacts of RGM initiatives. → Vending improved Revenue per case throu
Slide 9: Status of RGM initiatives in Chain store
Coca-Cola business Status of RGM initiatives in Chain store Product mix WSP increase (ensured sales activities based on price guidelines) × improvement (development of highly × Sales volume growth value-added products) [July-Sep Revenue per case status (Vs. PY)] Supermarket Drug store Discounter Rev
Slide 10: Status of RGM initiatives in Chain store
Coca-Cola business Status of RGM initiatives in Chain store 500 ml PET MS PET [Q3 initiatives] [Q3 initiatives] Compliance to guard rail (lowest Revenue per case increase of the main permissible WSP) package with the combination of packages (reinforcement of package lineup) Ensured sales activi
Slide 11: Initiatives for transformation of Vending business
Coca-Cola business Initiatives for transformation of Vending business ■ We have begun to see solid results of initiatives for revenue growth and profitability enhancement. For revenue growth For profitability enhancement Improve unprofitable locations Capturing prime locations [Number of withdrawal
Slide 12: Q3 YTD (Jan-Sep) financial results
Consolidated Q3 YTD (Jan-Sep) financial results ■ Consolidated operating profit closed at 19 Billion JPY. → Increases of 800 MM JPY v. Plan and 7.5 Billion JPY v. PY. (Unit: MM JPY, %) Vs. Plan Q3 2015 YTD Vs. PY Q3 2016 YTD 1 Plan* Actual Diff Diff % Actual*2 Diff Diff % Revenue 353,710 351,300 +2,
Slide 13: Q3 YTD financial results - Key drivers (v. Plan)
Consolidated Q3 YTD (Jan-Sep) financial results-Key drivers (v. Plan) (Unit: 100MM JPY) Plan* Q3 YTD Actual Diff Key drivers Diff ・Coca-Cola Business (CCW＋Shikoku CCBC) +33.6 Revenue 3,513 3,537 +24 ・Healthcare & Skincare Business -9.5 ・Coca-Cola Business (CCW＋Shikoku CCBC) +13.9 Gross profit 1,830
Slide 14: Drivers of operating profits (v. Plan)
Consolidated Q3 YTD (Jan-Sep) financial results-Drivers of operating profits (v. Plan) Coca-Cola business closed with operating profits exceeding 1 billion JPY than the plan. In addition to Chain store outperforming the sales volume plan, the rise of revenue per case impacted on marginal profits to
Slide 15: Q3 YTD financial results - Key drivers (v. PY)
Consolidated Q3 YTD (Jan-Sep) financial results-Key drivers (v. PY) (Unit: 100MM JPY) PY Actual* Q3 YTD Actual Diff Key drivers Diff ・Coca-Cola Business (CCW＋Shikoku CCBC) +239.9 Revenue 3,296 3,537 +240 ・Healthcare & Skincare Business +0.5 ・Coca-Cola Business (CCW＋Shikoku CCBC) +158.1 Gross profit
Slide 16: Drivers of operating profits (v. PY)
Consolidated Q3 YTD (Jan-Sep) financial results-Drivers of operating profits (v. PY) Coca-Cola business raised operating profits by 7.1 billion JPY from prior year. In addition to Chain store’s sales volume increases, driving marginal profits to grow by 3 billion JPY, there was a profit contribution
Slide 17: II. Activity Plans for Q4 and Full-year
II. Activity Plans for Q4 and Full-year 16
Slide 18: Q4 (Oct-Dec) Volume plan
Coca-Cola business Q4 (Oct-Dec) Volume plan ■ As we have set Q4 Volume plan conservatively, we aim to ensure delivering the target (do not change from the initial plan). Volume plan by channel Volume plan by brand Vs. PY Q4 plan (Unit: K c/s, %) Diff Diff % Vs. PY Coca-Cola 3,546 -89 -2.5 Q4 plan (U
Slide 19: Commercial strategies - Evolution of RGM in Chain store
Coca-Cola business Commercial strategies- Evolution of RGM in Chain store Price guideline Ensure progress management by the customer. Q 4 Guard rail (lowest Continue to comply guard rail. permissible WSP) Plan Reinforcement of Continue to reinforce activities with MS PET of Coca-Cola. package lineup
Slide 20: Commercial strategies - Transformation of Vending business
Coca-Cola business Commercial strategies-Transformation of Vending business Initiatives for revenue growth Q4 Plan Annual forecast Capturing prime locations (new placement) 3,400 VMs 21,500 VMs Q Promotion leveraging smartphone apps 23,500 VMs 60,000 VMs 4 Initiatives for profitability growth Plan
Slide 21: Commercial strategies - Stronger brand competitiveness
Coca-Cola business Commercial strategies-Stronger brand competitiveness Coca-Cola brand Products Promotions Winter campaigns × Bow label bottle Winter design bottle (500 ml PET exclusive) (MS PET) Georgia I Lohas “VM＋2℃ campaign” Launch of “I Lohas Nashi” Launch on Nov 28 I Lohas Nashi 555 ml P
Slide 22: Healthcare & skincare business Plan
Healthcare & skincare business Healthcare & skincare business Plan ■ Healthcare products: Aim to capture new demands by launching new products in addition to sales boost of core products. ■ Skincare products: We expect sales growth from highly profitable Skincare products through renewal of high pri
Slide 23: Full-year (Jan-Dec) Performance Plan (Consolidated)
Consolidated Full-year (Jan-Dec) － Performance Plan(Consolidated) ■ Full-year consolidated operating profit plan shall be set at 20.5 Billion JPY, up 6.2 Billion JPY from prior year (unchanged from the plan announced on Aug 12). (Unit: MM JPY, %) 2016 Full-year Vs. PY Plan Diff Diff % Revenue 460,20
Slide 24: Full-year Drivers of operating profit growth (v. PY)
Consolidated Full-year (Jan-Dec) － Drivers of operating profit growth (v. PY) Aim to deliver consolidated operating profit of 20.5 Billion JPY, up 6.2 Billion JPY from prior year. While projecting negative Sales volume v. PY, we will maintain Marginal profits (including impact of Revenue per case) a
Slide 25: Summary
Summary ■ Jan-Sep YTD registered consolidated operating profits exceeding the plan by 800 MM JPY. Profits of Coca-Cola business rose by 2.9 Billion JPY in real terms from the year earlier even excluding impacts from changing service life of sales equipment, despite our increased investments and spen
Slide 26: [Reference]
[Reference] 25
Slide 27: Q3 (July-Sep) financial results
Q3 (July-Sep) financial results (Unit: MM JPY, %) Vs. Plan Vs. PY Q3 2016 YTD Q3 Q3 2016 2015 YTD Plan* Actual Diff Diff % Actual Actual Diff Diff % Revenue 134,403 132,000 +2,403 +1.8 128,666 +5,737 +4.5 Coca-Cola Business 126,416 123,100 +3,316 +2.7 120,559 +5,857 +4.9 Hea l thca re & Ski nca re B
Slide 28: Trend of OTC market share (excl. VM)
Trend of OTC market share (excl. VM) 100％ (Unit: %, pts) Other 32.4 30.8 31.5 33.0 32.3 Company D +0.1 7.4 8.0 8.3 7.7 7.5 Company C 10.2 10.0 9.7 10.3 10.7 +0.5 Company B 11.3 11.7 11.0 11.1 11.5 +0.2 Company A 16.3 16.2 16.3 15.4 15.4 -0.9 CCW 22.4 23.3 23.2 22.5 22.6 +0.2 2015 Q3 2015年Q3 Q4 Q4 Q1
Slide 29: Q3 YTD (Jan-Sep) - Mix by brand/by channel
Q3 YTD (Jan-Sep) financial results － Mix by brand/by channel 2015* 2016 Others I Lohas 29％ 29％ 35％ 28％ 28％ 36％ Ayataka 7％ 8％ 8％ 8％ Aquarius 7％ 8％ 8％ 7％ Brand 8％ 9％ 8％ 8％ 7％ 9％ 8％ 7％ Sokenbicha 4％ 5％ 10％ 10％ 4％ 4％ Georgia 5％ 5％ Fanta 31％ 31％ 31％ 31％ 20％ 21％ Coca-Cola Zero 4％ 4％ 3％ 3％ 3％ 3％ Coca-Cola
Slide 30: Q3 (July-Sep) - Mix by brand/by channel
Q3 (July-Sep)－ Mix by brand/by channel 2015* 2016 Others I Lohas 29％ 29％ 28％ 27％ 35％ 33％ Ayataka 7％ 8％ 8％ 9％ Aquarius 7％ 8％ Brand 8％ 9％ 8％ 9％ Sokenbicha 9％ 9％ 10％ 9％ 11％ 10％ Georgia 13％ 5％ 5％ 14％ 5％ 5％ 5％ Fanta 5％ 27％ 27％ 25％ 26％ Coca-Cola Zero 17％ 17％ 4％ 4％ 3％ 4％ 4％ 3％ Coca-Cola 3％ 3％ 3％ 7％ 7％ 7％ 7
Slide 31: Sales update on vending machines by channel
Sales update on vending machines by channel Vending machine full service CAN VPM* V. PY [CCW Area] Vs. PY (%) Ja n Feb Ma r Apri l Ma y June Jul y Augus t September YTD total At-work (office) -2.2 ＋2.1 ＋0.0 -2.5 -1.6 -1.4 -1.3 ＋4.4 ＋0.6 -0.2 At-work (plant) -2.8 ＋1.9 ＋1.8 -3.0 -2.5 -1.4 -2.8 ＋6.0 ＋0
Slide 32: Q3 YTD (Jan-Sep) - Sales Volume by channel/package
Q3 YTD (Jan-Sep) － Sales Volume by channel/package ■Chain store Vs. Plan* Vs. PY Q3 2016 YTD Actual (Unit: K cases, %) Diff % Diff % SS PET (smaller than 850ml) 27,288 +133 +0.5 +1,999 +7.9 Midi PET (less than 1,500ml ) 2,244 +328 +17.1 +1,181 +111.0 LS PET (1,500ml or larger) 34,124 +413 +1.2 +1,47
Slide 33: Q3 (July-Sep) - Sales Volume by channel
Q3 (July-Sep) － Sales Volume by channel Vs. Plan Vs. PY Q3 actual (unit: K c/s, %) Diff Diff % Diff Diff % Super market/Drug/Discounter 24,006 +898 +3.9 +1,913 +8.7 Convenience store 8,167 +155 +1.9 +734 +9.9 Chain store total 32,173 +1,052 +3.4 +2,647 +9.0 Vending 19,361 +82 +0.4 +373 +2.0 Retail 3
Slide 34: Q3 (July-Sep) - Sales Volume by brand
Q3 (July-Sep) － Sales Volume by brand Vs. Plan Vs. PY*2 Q3 actual (unit: K c/s, %) Diff Diff % Diff Diff % Coca-Cola 4,925 +118 +2.5 +398 +8.8 Coca-Cola Zero 2,100 +158 +8.1 +141 +7.2 Fanta 2,562 +53 +2.1 +100 +4.1 Georgia 11,564 -105 -0.9 +497 +4.5 Core 8 Sokenbicha 3,490 +130 +3.9 +199 +6.1 Aquari
Slide 35: Q3 (July-Sep) - Sales Volume by package
Q3 (July-Sep) － Sales Volume by package Vs. Plan Vs. PY Q3 actual (unit: K c/s, %) Diff Diff % Diff Diff % Small (less than 850ml) 20,416 +278 +1.4 +2,075 +11.3 Medium (less than 1,500ml) 1,151 +343 +42.5 +640 +125.1 PET Large (less than 1,500ml) 15,980 +353 +2.3 +582 +3.8 Total 37,547 +974 +2.7 +3,
Slide 36: Q3 (July-Sep) - Sales Volume by channel and package
Q3 (July-Sep) － Sales Volume by channel and package ■Chain store Vs. Plan Vs. PY Q3 actual (Unit: K cases, %) Diff Diff % Diff Diff % SS PET (smaller than 850ml) 10,729 +133 +1.3 +932 +9.5 Midi PET (less than 1,500ml ) 1,087 +328 +43.1 +622 +133.5 LS PET (1,500ml or larger) 14,991 +413 +2.8 +618 +4.
Slide 37: Q4 (Oct-Dec) - Sales Volume Plan by package
Q4 (Oct-Dec) － Sales Volume Plan by package Vs. PY Q4 Plan (unit: K c/s, %) Diff Diff % Small (less than 850ml) 14,665 -4 -0.0 Medium (less than 1,500ml) 471 +142 +43.2 PET Large (less than 1,500ml) 9,621 -400 -4.0 Total 24,757 -263 -1.1 Can (incl. bottle can) 13,083 -483 -3.6 Other 3,354 +147 +4.6
Slide 38: Q4 (Oct-Dec) - Sales Volume Plan by channel and package
Q4 (Oct-Dec) － Sales Volume Plan by channel and package ■Chain store Vs. PY Q4 Plan (Unit: K cases, %) Diff % SS PET (smaller than 850ml) 7,702 -288 -3.6 Midi PET (less than 1,500ml ) 424 +128 +43.1 LS PET (1,500ml or larger) 8,870 -494 -5.3 Can (incl. bottle CAN) 3,942 -255 -6.1 Other 198 -13 -6.1
Slide 39: Performance Trend
Performance Trend (Unit: MM JPY) 2016 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Plan Revenue 164,731 207,827 226,111 247,737 240,825 253,248 245,874 327,821 409,521 395,556 369,698 375,764 399,717 386,637 431,711 424,406 440,476 460,200 Operating 15,160 17,
Slide 40: Managerial KPI trend
Managerial KPI trend <Operating profits/Operating profit ratio> <Net asset/capital ratio> (MM JPY) (MM JPY) Operating profit (MM) Net a ssets (MM JPY ) Ratio（％） （％） （％） Capi ta l ra ti o (%) 16,469 10 100 15,927 14,262 300,000 15,000 13,463 8 260,878 257,936 254,140 250,000 227,864 231,056 90 11,008
Slide 41: Coca-Cola System in Japan - Capital Relationship
Coca-Cola System in Japan – Capital Relationship Investments with figures indicate %; ( ) in total by CCW+ Shikoku (As of Jan 1, 2016) Joint companies of TCCC/CCJC ⑤ and bottlers Coca-Cola Integrated 21.1% Coca-Cola Business Systems 3.7% Co., Ltd. (CCIBS) (26.1%) West Co., ⑥ Ltd. (CCW) ① The Coca-Co
Slide 42: Coca-Cola affiliated companies and their roles
Coca-Cola affiliated companies and their roles 1. Coca-Cola West Co., Ltd. (CCW) 5. Coca-Cola bottlers (CCBCs) Coca-Cola West Japan (CCWJ) was established in 1999 by merging There are 7 bottlers in Japan responsible for manufacturing and Kitakyushu CCBC and Sanyo CCBC. CCWJ acquired ownership of Mik
Slide 43: Glossary
Glossary Term Explanation Business (segment) ・Coca-Cola business (soft drink business) Business to manufacture and sell soft drink beverages including Coca-Cola ・Healthcare & skincare business Business to manufacture and sell health food and cosmetics operated by Q'sai and their 5 subsidiaries Chann
Slide 44: Forward-looking statement
Forward-looking statement The plans, performance forecasts, and strategies appearing in this material are based on the judgment of the management in view of data obtained as of the date this material was released. Please note that these forecasts may differ materially from actual performance due to
Coca-Cola West Company — Q3 2016 Earnings Presentation on 6ix