Pernod Ricard Sa · EURONEXT:RI
Pernod Ricard Sa — Pernod Ricard S A — FY2022 Earnings Presentation
52 slides from Pernod Ricard Sa's earnings presentation, Sep 1, 2022
Slide 1: F22 Full Year Sales and Results
F22 Full Year Sales and Results 1st September 2022 Growth data specified in this presentation refers to organic growth, unless otherwise stated Data may be subject to rounding This presentation can be downloaded from our website: www.pernod-ricard.com
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Slide 3: Executive Summary
Executive Summary Net Sales +21% Reported +17% Organic PRO! +25% Reported +19% Organic A record year with excellent performance Record Sales at €10.7bn... + Market share gains in most markets, leveraging our wide portfolio and geographic breadth + Price increases across all markets averaging mid sin
Slide 4: Demonstrating strength, agility and resilience; deploying the Conviviality Platform
isin ewes! Demonstrating strength, agility and resilience 1 Deploying the Conviviality Platform at pace + Executing our consumer-centric strategy at scale by leveraging data, our FCF €1 8bn portfolio of brands and our distribution network to further stretch our growth N t Debt /EBIT A * Strengthenin
Slide 5: Delivering superior Net Profit growth
aL) Delivering superior Net Profit growth FY reported FY organic FY22 (€m) A A Vs. FY19? Net Sales 10,701 +21% +17% +18% Mature markets 5,959 +14% i 21% Reported N t Emerging markets 4,742 + Profit Profit from Recurring Operations (PRO) 3,024 +25% +19% +22% PRO / Net Sales 28.3% +80bps +52 bps Net P
Slide 6: Pernod Ricard
Pernod Ricard Créaleurs de comVighté
Slide 7: Towards sustainable, stretched growth: our winning formula
Towards sustainable, = = stretched growth Our winning formula Pernod Ricard’s Unique Competitive Advantages + Widest and most comprehensive premium plus spirits portfolio o Strong brand equity and brand building capabilities + Diversified global footprint and scale o Balanced contribution to growth
Slide 8: FY22 Net Sales by premium segment
Super premium+ 39% 44% Premium 37% 37% FY22 Net Sales Contribution to Organic Growth 8
Slide 9: Broad-based geographical growth
Towards/sustainable, stretched growth Group Organic Net Sales +17% ..and broad-based geographical growth Net Sales Contribution to FY22 growth Weight in FY22 Net Sales Organic Net Sales growth MATURE MARKETS EMERGING MARKETS
Slide 10: Good Times from a Good Place progress
63% 73% Nurturing Terroir 88% 64% Valuing People 95% 66% Circular Making 93% 94% Responsible Hosting Progress made Future progress to FY22 to be made 10
Slide 11: FY23 to FY25 mid-term financial framework
Towards sustainable, stretched growth Maximising long-term sustainable value creation FY23 to FY25 mid-term financial framework + +4% to +7% annual top line growth, aiming for the upper end of the range + Focus on pricing, enhanced by our digital proprietary predictive tools + Continuous improvement
Slide 12: Organic Net Sales growth corridor
+4 to +7% Organic Net Sales growth, % corridor Mindset for growth Transform & Accelerate 12
Slide 13: Sales
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Slide 14: Organic growth by region FY20-FY22
-6% +14% +12% +8%1 -14% +11% +19% +7%1 -6% +4% +19% +6%1 -10% +10% +17% +7%1 FY20 FY21 FY22 CAGR 1 19 - 22 14
Slide 15: Good growth and pricing in Must-Win markets
Good growth and pricing in Must-Win markets USA: +8% / 3yr CAGR! +8% China: +5% / 3yr CAGR! +9% On-trade recovery and Off-trade resilience along with continuing consumer trends of premiumisation and convenience Strong price-mix, following broad-based price increases in FY22 with additional price inc
Slide 16: Strength, resilience and pricing across all markets
Strength, resilience and pricing across all markets Europe: +19% / 3yr CAGR! +6% Spain: +36%, Sales driven by Seagram’s Gin, Beefeater and Ballantine’s with strong recovery in On-trade, the resumption of tourism and resilience in Off-trade France: growth driven by Strategic International Brands and
Slide 17: Organic growth by region FY20-FY22
-10% +11% +18% +7%1 -9% +7% +18% +5%1 7% +28% +24% +26%1 -4% 2 +2% -4% -2%1 FY20 FY21 FY22 CAGR 1 19 - 22 17
Slide 18: Strong growth of Strategic International Brands
Strategic — International Brand. FINEST WHISKY Strong growth of Strategic International Brands across all regions Jameson: +24% / 3yr CAGR! +12% Scotch: +25% / 3yr CAGR! +5% Jameson breaking the 10M cases? milestone with fastest growth rate in 30 years Double digit growth? in USA, successful launch
Slide 19: Specialty Brands
Specialty Brands +24% ¥. Weight in Sales , doubling vs. Specialty Brands tapping into premiumization trends and maintaining very high momentum Specialty whisky +23% Specialty Gin +43% US whiskeys: +38% with Jefferson’s and Rabbit Hole key drivers of growth Redbreast: +27% & Spot Range +21%, very str
Slide 20: Robust growth across the wider portfolio
alley CARIBBEAN RUM WITH COCONUT LIQUEUR ~ ORIGINAL 21% Ale/Vol_ 750") \Wie Ge Highlights of robust growth achieved across the wider portfolio Beefeater: +35%, strong rebound notably with On-trade reopening in Spain and outstanding growth in Brazil. Good development of Beefeater Light Perrier-Jouét:
Slide 21: Innovation in strong growth +45%
Innovation in strong growth +45% Launch of Jameson Orange, Launch of Jameson Ginger & Lime Launch of Avion Reserva Cristalino, #1 spirits innovation in the USA Launch of Beefeater Zesty Lemon in Central Europe with further expansion in European markets our latest Ultra Premium+ Tequila addition Laun
Slide 22: Targeted media investments in FY22
LEMONADE Targeted media investments in FY22 Absolut is introducing its biggest marketing Maison Martell launched the next chapter of campaign in over a decade “The World of its Soar Beyond the Expected’ campaign Absolut Cocktails. Born to Mix.” during Black History Month with Janelle Monde Jameson l
Slide 23: Profit
Pernod Ricard Créaleurs de comivialité
Slide 24: Profit from Recurring Operations
€ millions FY21 FY22 FY reported Δ FY organic Δ Net Sales 8,824 10,701 +21% +17% Gross margin (GM) 5,293 6,473 +22% +17% GM/Net Sales 60.0% 60.5% +12bps Advertising & Promotional Spend (A&P) 1,393 1,698 +22% +17% A&P/Net Sales 15.8% 15.9% -5bps Contribution After A&P Spend (CAAP) 3,900 4,775 +22% +1
Slide 25: Net Profit from Recurring Operations
€ millions FY21 FY22 FY reported Δ Profit from Recurring Operations 2,423 3,024 +25% Financial income (expense) from recurring operations (262) (215) -18% Corporate Income tax on recurring operations (526) (651) +24% Minority interests and other (24) (34) Group share of Net Profit from Recurring Ope
Slide 26: Group share of Net Profit
€ millions FY21 FY22 FY reported Δ Profit from Recurring Operations 2,423 3,024 +25% Profit from Non Recurring Operations (62) (62) Operating Profit 2,361 2,963 Financial income (expense) (371) (260) Corporate income tax (667) (676) Non-controlling interests and other (18) (30) Group share of Net Pr
Slide 27: Cash
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Slide 28: Free Cash Flow
€ millions FY21 FY22 Reported Δ %Δ Profit from Recurring Operations 2,423 3,024 +601 +25% Amortisation, provision, others 383 441 +58 Recurring Cash Flow 2,806 3,465 +659 +23% Decrease/(increase) in strategic stocks (221) (264) (43) Decrease/(increase) in operating Working Capital Requirement (WCR)
Slide 29: Net debt and leverage
Leverage Net Debt/EBITDA 2.6x 2.4x +1,205 8,657 562 156 €m 7,452 Net Debt 863 1,813 826 611 30-Jun-21 FCF M&A Dividends Other Others Translation 30-Jun-22 Paid financial Adjustment Operations • • • • 29
Slide 30: Dividend per share
4.12 3.12 3.12 2.36 2.66 2.02 Dividend €/share FY17 FY18 FY19 FY20 FY21 FY22 • • 30
Slide 31: Conclusion
Pernod Ricard | Créateurs de comivialité
Slide 32: Conclusion and FY23 expectations
VA Tr ae N OK i CONCLU y In FY22 Pernod Ricard had a record year with an excellent performance, demonstrating improved strength, resilience and agility within a turbulent environment Over FY23 to FY25, we are confident to deliver our medium term strategic ambition leveraging our unique competitive a
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Slide 34: Definitions and reconciliation of non-IFRS measures to IFRS measures
Organic growth - Organic growth is calculated after excluding the impacts of exchange rate Definitions and reconciliation of movements, acquisitions and disposals and changes in applicable accounting principles. non-IFRS measures to IFRS measures - Exchange rates impact is calculated by translating
Slide 35: Upcoming events calendar
Date (subject to change) Event 20 October 2022 Q1 FY23 Sales 10 November 2022 Annual General Meeting 22 November 2022 EMEA LATAM Conference Call 16 February 2023 H1 FY23 Sales and Results 35
Slide 36: Markets by region
Asia-Rest of World Americas Europe Algeria Malaysia Argentina Albania Angola Mongolia Bolivia Armenia Cambodia Morocco Brazil Azerbaijan Cameroon Mozambique Caribbean Belarus China Namibia Chile Bosnia Congo Nigeria Colombia Bulgaria Egypt Persian Gulf Costa Rica Croatia Ethiopia Philippines Cuba Ge
Slide 37: Strategic International Brands volumes and growth
Volumes FY22 Organic Net Sales Volumes Price/mix growth FY22 (in 9Lcs millions) Absolut 12.4 +19% +18% +1% Chivas Regal 4.6 +29% +27% +1% Ballantine's 9.1 +27% +20% +7% Ricard 4.5 +4% +5% (1)% Jameson 10.4 +24% +22% +2% Havana Club 4.6 +20% +5% +15% Malibu 4.9 +7% +3% +4% Beefeater 3.7 +35% +27% +8%
Slide 38: Net Sales by region
Net Sales FY21 FY22 Change Organic Growth Group Structure Forex impact (€ millions) Americas 2,627 29.8% 3,133 29.3% 506 +19% 319 +12% 30 +1% 156 +6% Asia / Rest of World 3,640 41.2% 4,438 41.5% 799 +22% 674 +19% 0 +0% 125 +3% Europe 2,557 29.0% 3,130 29.2% 573 +22% 483 +19% 55 +2% 35 +1% World 8,82
Slide 39: Consolidated income statement
(€ millions) FY21 FY22 Change Net sales 8,824 10,701 +21% Gross Margin 5,293 6,473 +22% Advertis i ng a nd promotions s pend (1,393) (1,698) +22% Contribution after A&P spend 3,900 4,775 +22% Structure cos ts (1,477) (1,751) +19% Profit from recurring operations 2,423 3,024 +25% Fi na nci a l i ncom
Slide 40: Results by region: World and Americas
World (€ millions) FY21 FY22 Change Organic Growth Group Structure Forex impact Net sales (Excl. T&D) 8,824 100.0% 10,701 100.0% 1,877 +21% 1,476 +17% 86 +1% 316 +4% Gross margin after logistics costs 5,293 60.0% 6,473 60.5% 1,180 +22% 904 +17% 27 +1% 249 +5% Advertising & promotion (1,393) 15.8% (1
Slide 41: Results by region: Asia / Rest of World and Europe
Asia / Rest of the World (€ millions) FY21 FY22 Change Organic Growth Group Structure Forex impact Net sales (Excl. T&D) 3,640 100.0% 4,438 100.0% 799 +22% 674 +19% 0 +0% 125 +3% Gross margin after logistics costs 2,060 56.6% 2,496 56.2% 436 +21% 383 +19% (0) (0)% 53 +3% Advertising & promotion (542
Slide 42: Average rates evolution and forex impact
Average rates evolution On Profit from Forex impact FY22 On Net Sales Recurring (€ millions) FY21 FY22 % Operations US dollar USD 1.19 1.13 -5.5% 145 63 Russian rouble RUB 89.10 84.39 -5.3% 12 9 Turkish Lira TRL 9.22 13.83 49.9% (67) (72) Indian rupee INR 87.94 84.93 -3.4% 42 14 Chinese yuan CNY 7.9
Slide 43: Estimated impact of a 1% appreciation of the USD
Estimated impact of a 1% appreciation of the USD Impact on the income statement (1) (€ millions) Profit from recurring operations +15 Financial result (1) Pre-tax profit from recurring operations +14 Impact on the balance sheet (€ millions) Increase/(decrease) in net debt +40 (1) Full-year effect 43
Slide 44: Assets
Assets 30/06/2021 30/06/2022 (€ millions) (Net book value) Non-current assets Intangi bl e a s s ets a nd goodwi l l 16,230 17,657 Ta ngi bl e a s s ets a nd other a s s ets 3,963 4,600 Deferred tax a s s ets 1,623 1,844 Total non-current assets 21,816 24,100 Current assets Inventori es 6,555 7,369
Slide 45: Liabilities and shareholders' equity
Liabilities and shareholders’ equity 30/06/2021 30/06/2022 (€ millions) Group Shareholders’ equity 14,829 15,944 Non-control l i ng i nteres ts 246 309 of which profit attributable to non-controlling interests 13 35 Total Shareholders’ equity 15,075 16,253 Non-current provi s i ons a nd deferred tax
Slide 46: Working capital
June June June FY21 WC FY22 WC (€ millions) 2020 2021 2022 change* change* Aged work i n progres s 5,084 5,373 5,732 206 287 Adva nces to s uppl i ers for wi ne a nd a gei ng s pi ri ts 19 9 8 (10) (1) Pa ya bl es on wi ne a nd a gei ng s pi ri ts (108) (93) (115) 22 (21) Net aged work in progress 4
Slide 47: Net financial debt
30/06/2021 30/06/2022 (€ millions) Current Non-current Total Current Non-current Total Bonds 70 8,787 8,857 842 9,238 10,079 Commercial paper 7 - 7 180 - 180 Other loans and long-term debts 115 108 222 226 179 405 Other financial liabilities 122 108 229 406 179 585 Gross Financial debt 192 8,894 9,0
Slide 48: Cash flow statement
(€ millions) 30/06/2021 30/06/2022 Opera ting profi t 2,361 2,963 Depreci a tion a nd a mortis a tion 367 381 Net cha nge i n i mpa i rment of goodwi l l , PPE a nd i ntangi bl e a s s ets 78 10 Net cha nge i n provi s i ons (80) 7 Cha nges i n fa i r va l ue on commerci a l deri va tives a nd bi ol
Slide 49: Debt maturity profile
2.0 1.5 1.0 1.7 1.5 - 1.2 1.1 0.5 0.9 0.8 0.8 0.8 0.4 0.5 0.5 0.5 0.2 0.0 0.0 21/22 22/23 23/24 24/25 25/26 - 26/27 27/28 28/29 29/30 30/31 31/32 …- 41/42 … 50/51 -0.5 Cash Other debts Commercial paper Bonds Syndicated credit -1.0 49
Slide 50: Bond issues by currency
Currency Par value Coupon Issue date Maturity date € 1,500 m o/w: € 500 m 0.000% 24/10/2019 24/10/2023 € 500 m 0.500% 24/10/2027 € 500 m 0.875% 24/10/2031 € 650 m 2.13% 29/09/2014 27/09/2024 € 1,500 m o/w: € 750 m 1.125% 01/04/2020 07/04/2025 EUR € 750 m 1.750% 08/04/2030 € 500 m o/w: € 250 m 1.125%
Slide 51: Exchange rates and leverage ratio
Closing rate Average rate(1) EUR/USD rate Jun FY21 -> Jun FY22 1.19 -> 1.04 1.19 -> 1.13 Ratio at 30/06/2021 2.6 2.6 EBITDA & cash generation excl. Group structure effect and forex impacts (0.4) (0.4) Group structure and forex impacts 0.3 0.2 Ratio at 30/06/2022 2.5 2.4 (1) Last-twelve-month rate 51
Slide 52: Number of shares and diluted EPS
(x 1,000) FY21 FY22 Number of shares in issue at end of period 261,877 257,947 Weighted average number of shares in issue (pro rata temporis) 262,143 261,190 Weighted average number of treasury shares (pro rata temporis) (1,347) (2,158) Dilutive impact of stock options and performance shares 718 688