C&C Group PLC · LSE:CCR
C&C — H1 2006/07 Earnings Presentation
30 slides from C&C's earnings presentation, Oct 12, 2006
Slide 1: C&C Group plc
~ C&C Group plc |
Slide 2: Presentation Agenda
Presentation Agenda ¾ Highlights ¾ Financial Review ¾ Market & Brand Review ¾ Outlook ¾ Q&A 2
Slide 3: Financial Highlights
Financial Highlights Amount Increase* ¾ Revenue (€m) 532.1 +27% ¾ Operating profit (€m) 113.5 +66% Operating margin 21.3% +5pts ¾ Adjusted Earnings Per Share (cent) 28.7 +77% ¾ Dividend per Share (cent) 12.0 +85% Payout ratio 42% *Comparisons exclude exceptional items 3
Slide 4: Strategic & Operating Highlights
Strategic & Operating Highlights Market Share Growth Cider ¾ Cider volumes +85% ¾ Extended distribution of Magners in GB 0.9% +0.5pts ¾ Bulmers market share growth in Ireland 10.2% +0.3pts Other divisions ¾ Completed disposal of Snacks ¾ Soft drinks business stabilised 4
Slide 5: Operating Profit Profile by Division
Operating Profit Profile Operating Profit By Division Half Year to Year to Half Year to Aug 06* Feb 06 Aug 05 Cider 79% 68% 66% International Spirits & Liqueurs 9% 13% 11% Soft Drinks/Distribution 12% 19% 23% August 2006 Cider Intl. S&L SD/D 5
Slide 6: Operating Profit Profile by Region
Operating Profit Profile Operating Profit By Region Half Year to Year to Half Year to Aug 06 Feb 06 Aug 05 ROI 48% 71% 78% UK 41% 17% 9% Other 11% 12% 13% August 2006 ROI UK Other 6
Slide 7: Financial Review
- « Financial Review
Slide 8: Financial Summary – Operating Profit
Financial Summary – Operating Profit Excluding Exceptionals Aug '06 Aug '05 Growth €m €m Revenue 532.1 419.5 26.8% Marketing 46.4 30.4 52.0% Marketing % of Revenue 8.7% 7.2% 1.5 Operating Profit 113.5 68.4 65.9% Operating Profit Margin 21.3% 16.3% 5.0 8
Slide 9: 2005/6 Financial Summary - Earnings
2005/6 Financial Summary - Earnings Aug '06 Aug '05 Growth Excluding exceptionals €m €m Operating Profit 113.5 68.4 66% Finance Charges (7.8) (10.3) (24%) Profit before tax 105.70 58.10 82% . Taxation (12.2) (6.0) 103% Rate 11.5% 10.3% Earnings 93.5 52.1 79% Earnings Conversion 82% 76% 9
Slide 10: Exceptional Items
Exceptional Items Exceptional Items €m Profit on sale of property (Snack Division) 4.6 Goodwill write off (Loss of Wine Agencies) (8.3) (3.7) Tax (0.5) TOTAL (4.2) 10
Slide 11: Cash Flow
Cash Flow Aug 2006 Aug 2005 Growth €m €m EBITDA 124.6 78.5 Capital expenditure (net) (17.9) (5.5) Working capital (18.3) 1.1 Share Based employee benefits 0.5 0.5 Operating cash flow 88.9 74.6 19% Reorganisation (2.2) Finance Charges (7.5) (9.5) Tax 0.2 (1.0) Free cash flow 81.6 61.9 32% Free cash f
Slide 12: Earnings & Dividends
Earnings & Dividends Feb 2006 Cent per €m Share Reported Earnings (i) 93.5 28.6 Dividend Proposed 39.3 12 Payout ratio 42% (i) Excluding goodwill and exceptionals 12
Slide 13: Balance Sheet & Capital Structure
Balance Sheet & Capital Structure Balance Sheet Debt/EBITDA Net debt at 1 March, 2006 (€m) 383.1(i) 2.65 Free cash flow in period (€ m) (81.6) Dividends Paid (€m) 19.8 Other (€m) (0.8) Net debt at 31 August, 2006 (€ m) 320.5(i) 1.7(ii) Capital structure – 31 August, 2006 Net debt to total capitalisa
Slide 14: Divisional Performance Summary
Divisional Performance Summary (i) Operating Profit Profile Divisional Share of Profit Growth Group Growth Cider 79% 100% 100% 79% International Spirits & 90 9% 29% 5% Liqueurs Soft Drinks & Snacks 12% 2% 0% 59% Distribution 0% (90%)45 (5%) Total 100% 66% 100% (i) Before exceptional items 14
Slide 15: Cider
Cider Aug 2006 Aug 2005 Growth €m €m Revenue - ROI 113.5 105.4 8% - International 156.0 39.1 299% 269.5 144.5 87% Marketing 29.1 13.8 111% Marketing /Revenue 10.8% 9.6% 1.2pts Operating Profit 90.0 45.1 100% Operating Margin 33.4% 31.2% 2.2pts Price Yield Achieved*: Bulmers 3.5% Magners GB 1.7% * Ne
Slide 16: International Spirits & Liqueurs
International Spirits & Liqueurs Aug 2005 Growth Aug 2006 Aug 2005 Proforma (i) Proforma €m €m €m Revenue 36.1 28.9 30.7 17.6% Marketing 6.3 4.5 6.2 1.6% Marketing /Revenue 17.5% 15.6% 20.2% (2.7) Operating Profit 9.7 7.6 7.6 27.6% Operating Margin 26.9% 26.3% 24.8% 2.1 (i) Restated to reflect chang
Slide 17: Soft Drinks & Snacks
Soft Drinks & Snacks* Aug 2006 Aug 2005 Growth €m €m Revenue 100.6 97.3 3.4% Marketing 8.1 9.2 (12.0%) Marketing % of Revenue 8.0% 9.4% (1.4) Operating Profit 9.9 9.6 3.1% Operating Profit Margin 9.8% 9.9% (0.1%) Revenue Growth Analysis Volume 4.4% Price Yield (1.0%) *Excluding Snacks & Danone Brand
Slide 18: Market & Brand Review
- Market & Brand Review
Slide 19: Irish LAD market
Irish LAD market Market Trends Year to Half Year to Feb 06 Aug 06 Overall Market 1.9% 0.2% On-Trade (1.4%) (1.4%) Off-Trade 11.9% 13.2% Bulmers Market Share MAT Volume Increase Share on Feb 06 Overall (i) 10.2% +0.3 On-Trade (ii) 10.4% +0.4 Off-Trade (ii) 7.3% +0.3 (i) Rev. Commrs/C&C July‘ 06 (ii)
Slide 20: International Cider
International Cider Overall ¾ Magners dominant share of branded cider ¾ 263% volume growth in H1 2006/7 FY 05/6 H1 06/07 Profile Profile ¾ GB is now the principal market Great Britain 64% 85% Northern Ireland 22% 8% Magners Bulmers USA 6% 2% 100% Europe 8% 5% 38% 63% 75% 50% 25% 62% 37% 0% FY2005/6
Slide 21: International Cider
International Cider Market Share – On-trade LAD Market Share Increase on Market Share Market Share MAT Feb ‘06 Run Rate(i) Run Rate(i) July ’06 July ‘06 July ‘05 N. Ireland 6.8% 0.4pts 7.6% Scotland 3.0% 0.5pts 3.3% 2.3% London 1.7% 0.7pts 2.7% 0.7% Rest of GB 0.5% 0.5 pts 1.4% - Total GB 0.9% 0.5pt
Slide 22: International Cider
International Cider On Trade Distribution July 2006 Feb 2006 Increase N. Ireland 93% 87% +6 pts Scotland 75% 70% +5 pts London 62% 44% +18 pts Total GB 59% 22% +37 pts Source Nielsen (Turnover weighted) 22
Slide 23: International Cider
International Cider Overall EDINBURGH GUNNERS 62% 23
Slide 24: International Spirits & Liqueurs
International Spirits & Liqueurs ¾ Tullamore Dew maintaining good growth Shipment Depletions Brand Growth Trend(i) ¾ Carolans recovery in North America Carolans 22% 4% Tullamore Dew 25% 11% ¾ Frangelico broadly solid Frangelico 15% (1%) (i) Company estimates for half year Total 20% 5% (depletions ar
Slide 25: Soft Drinks
Soft Drinks Market conditions ¾ CSDs flat ¾ Buoyant water growth ¾ Margin pressure Objectives ¾ Stable market and financial performance ¾ Improved execution and cost reduction C&C’s Performance C&CGrowth Vol (6 mths to Aug 06) Profile % Carbonates 66% 2% Waters(i) 26%13% Other 8% 2% Total Total 4% (
Slide 26: Outlook
- Outlook )
Slide 27: Outlook
Outlook 2006/7 H2 ¾ Continued strong operating profit growth from Cider Division ¾ Accelerated rate of growth in Group Operating Profit Outlook Statement “C&C expects the strong market performance of its Cider division to be sustained in the second half of the year. The Cider division is the princip
Slide 28: Outlook
Outlook Capex/Cash Flow ¾ Capex investment in Cider c. €200 million Outlay over c. 18 months Production constraint eliminated by May 2007 ¾ FCF/EBITDA in 06/07 and 07/08 30% – 40% ¾ Dividend payout target unchanged 28
Slide 29: Q&A 2006/7 IR Calendar
Q&A 2006/7 IR Calendar H1 ’06/’07 Period end 31 August 2006 H1 ’06/’07 results 12 October 2006 FY06/07 Pre-close February 2007 29
Slide 30: C&C Group plc contact details
C&C Group plc P +353 1 616 1100 Kylemore Park F +353 1 616 1163 Dublin 10 E C&CGroup@kcapitalsource.com Ireland W www.candcgroupplc.ie 30