33 slides from Anadolu Efes Biracilik Ve Malt Sanayii A.s's investor presentation, 2016
Slide 1: Investor Presentation
ANADOLU® EFES§ INVESTOR PRESENTATION
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation may contain certain forward-looking statements concerning our future performance and should be considered as good faith estimates made by the Company. These forward-looking statements reflect management expectations and are based upon currently available
Slide 3: Anadolu Efes - Ownership Structure
Anadolu Efes - Ownership Structure (1) 20% held by TCCC (The Coca-Cola Export Cooperation) and 4% by Özgörkey Holding 3 * Only the major subsidiaries of the Group are presented
Slide 4: Anadolu Efes at a Glance
Anadolu Efes at a Glance Serving more than 670 mn people 16 16 countries; 15 Breweries & 25 Bottling Plants 11 o Europe’s 6th largest brewer 2005 2015 o World’s 12th largest brewer # of Countries* o 5th largest Coca-Cola bottler in the Cola system 670 World class brand portfolio in beer & soft drink
Slide 5: Consolidated Performance - FY2015
Consolidated Performance - FY2015 SALES VOLUME NET SALES REVENUE EBITDA (BNRI) & EBITDA (BNRI) MARGIN 17.3% 17.2% mn TRL 10.205,1 mn TRL 88.7 86.1 10,021.4 mhl 1,720.9 1.766,1 FY2014 FY2015 FY2014 FY2015 FY2014 FY2015 BREAKDOWN 8% 15% due to rounding *Numbers may not add up to 100% 24% 16% 19% 76% 1
Slide 6: FY2015 Key Highlights
FY2015 Key Highlights Consolidated results in line with our guidance Consolidated sales volume at 86.1 mhl, down 2.8%; o Ex-Ukraine, sales volume decline was limited to 0.8% Solid results with 1.8% and 2.6% higher consolidated revenues & EBITDA compared to last year o Flattish EBITDA margin in line
Slide 7: Strong Competitive Advantages
Strong Competitive Advantages Balanced Beer & Soft Drink Operations Strategic Partnership with SABM & TCCC Expertise & Know-how in driving cost efficiencies Strong regional player powered by proven local know-how 7
Slide 8: Solid Cash Flow Generation
Solid Cash Flow Generation TL million 8
Slide 9: Long Term Key Priorities
Long Term Key Priorities Continue to generate value by margin improvement and FCF generation through our priorities; o capitalizing on our strong brand portfolios o to achieve optimal brand & SKU mix o excelling in execution o focus on quality market share o strong cash flow generation with special
Slide 10: Beer Operations
ANADOLU EFES : eid BEER OPERATIONS
Slide 11: Beer Operations
Beer Operations 39.5mhl of total beer capacity 11
Slide 12: Markets with lower per capita consumption but high potential
Markets with lower low per per cap capita consumption consumption but high but high potential potential Operating markets with growth potential characterized by; o low per capita consumption o developing economies o young populations o westernization/urbanization 12 Source: Canadean Global Beer Tren
Slide 13: Beer Group Strategy
ANADOLU Beer Group Strategy EFES te. | Provide choice and innovation to consumers: Branbs NN Grow brand love Excel in customer collaboration, E > ECUTI O N \ aba ttae Sahai Build competitive advantage through lean FF i Cl FE N CY w and efficient operations Focus on employees, customers, regulators,
Slide 14: Turkish Beer Market
Turkish Beer Market Low per capita consumption of 11 liters offering a growth potential Expected compounded annual growth rate of 2%* between 2016- 2020 Growing population with 1.3% annual growth rate 32% is below age 18 Returnable market enabling higher operational profitability Bottles & kegs
Slide 15: Efes Turkey
Efes Turkey Vertically integrated Market Leader with; o 4 Breweries - 9.5mhl total brewing capacity o 2 Malteries & 1 Hops Processing Facility o 69% market share* o 100% brand awareness for «Efes Pilsen» o Rich portfolio of local, imported & licensed brands covering all segments o # 1 in consumer sp
Slide 16: Russian Beer Market
Russian Beer Market World’s 4th largest beer market with total consumption of ~69mhl Expected compounded annual growth rate of 3%* between 2016-2020 Dominated by multinationals; o Top 4 accounting for ~ 75% of the market Share of Modern Trade above 60% - more than doubled in the last few years 16 *C
Slide 17: Efes Russia
Efes Russia #2* player with; o 6 Breweries – 30mhl total brewing capacity o 4 Malteries & 1 Preform Plant o AEFES’ largest beer market; 48% of total beer volumes from Russia o 15% market share* - #1 position in Premium category Volume Share** Value Share** - Numbers may not add up to 100% 26% 13%
Slide 18: Other International Beer Operations
Other International Beer Operations Market leader in; Kazakhstan Georgia Moldova Expected compounded annual growth rate of 2%* between 2016-2020 in Kazakshtan 18 *Canadean
Slide 19: Commitment to Environment
Commitment to Environment 19
Slide 20: Soft Drink Operations
SOFT DRINK OPERATIONS
Slide 21: CCI at a Glance
CCI at a Glance Market leader in Turkey with 64% & Kazakhstan with 50% market share #2 in Iraq with 31% & Pakistan with 36% market share 25 Bottling Plants in 10 Countries 5th largest Coca-Cola bottler in Cola system Annual capacity of 1.4bn uc 1.2bn uc sales volume 28bn annual servings 21
Slide 22: CCI at a Glance
CCI at a Glance Sources: IMF (GDP) and TCCC and CCI best estimates based on Nielsen and own market intelligence. 22 Note: Bubbles represent market size
Slide 23: Soft Drinks Business Strategic Priorities
Soft Drinks Business Strategic Priorities 23
Slide 24: Strong Brand Portfolio
Strong Brand Portfolio ANADOLU EFES BRAND & FLAVOR EXPANSION PACKAGE INNOVATION 2006 2015 Brands 17 30 Flavors 44 148 Differentiated package segmentation across channels, customers & consumers 24
Slide 25: Financials and Outlook
FINANCIALS AND OUTLOOK
Slide 26: Financial Highlights
Financial Highlights Turkey Beer International Beer CCI (mn TL) (mn USD) (mn TL) FY2015 vs FY2014 FY2015 vs FY2014 FY2015 vs FY2014 Volume (mhl) 6,6 -6,3% 14,1 -19,0% 1.151,9 1,9% Net Sales 1.484,8 -0,3% 725,1 -37,3% 6.723,9 12,3% Gross Profit 908,1 -3,6% 345,7 -35,4% 2.334,4 7,0% EBIT (BNRI) 291,5
Slide 27: Balance Sheet Flexibility
Balance Sheet Flexibility Anadolu Efes Consolidated Beer Group 1.95 Net Debt / EBITDA (BNRI) 2.26 1.98 Net Leverage Ratio 1.71 1.57 times times 1.40 2014 YE 9M 2015 2015 YE 2014 YE 9M 2015 2015 YE AEFES 2014 YE 2015 YE BEER 2014 YE 2015 YE TOTAL FINANCIAL DEBT m TL 4,507 5,383 TOTAL FINANCIAL DEBT m
Slide 28: Borrowing Mix & Liquidity Profile
Borrowing Mix & Liquidity Profile No material financing need until 2018 at AEFES level and until 2022 at Beer Group level Average maturity of debt for; Beer Group is app. 5.6 years and Anadolu Efes is app. 3.9 years 705 650 500 500 Schedule Maturity 247 188 152 88 109 120 120 59 34 54 55 36 36 43 20
Slide 29: Interest Breakdown
Interest Breakdown Beer Group Anadolu Efes YE 2014 YE 2015 YE 2014 YE 2015 21% 25% 38% 33% 62% 67% 75% 79% Fixed Floating Fixed Floating 29
Slide 30: Beer Group 2016 Guidance
Beer Group 2016 Guidance Turkey beer market decline low single digits Efes Turkey volume flattish Russian beer market decline parallel to the decline in 2015 EFES RUS volume outperform the market Total beer volume decline at a rate of mid-single digits Revenue lower decline compared to volume declin
Slide 31: Soft Drink Operations 2016 Guidance
Soft Drink Operations 2016 Guidance Turkey volume grow low single digit International volume grow low-mid single digits Consolidated volume grow at low-mid single digits Net sales revenue ahead of volume growth EBITDA margin flat FCF significant positive FCF 31
Slide 32: Consolidated 2016 Guidance
Consolidated 2016 Guidance Sales volumes grow low-single digit Sales revenues grow mid-single digits EBITDA (BNRI) grow in abs. terms EBITDA (BNRI) margin flattish to slightly lower margin Capex/net sales high-single digit FCF higher in absolute terms 32
Slide 33: Financial Priorities
Financial Priorities Sustain consolidated cash flows through; o focus on working capital optimization o optimized capex policy o tight balance sheet management Deleveraging Efficiency improvements via savings Manage impact of F/X volatility on operations Commitment to Investment Grade Ratings 33