Fraser & Neave Ltd. · SGX:F99
Fraser & Neave — CLSA Hong Kong Investors' Forum September 2016
26 slides from Fraser & Neave's conference presentation, Sep 19, 2016
Slide 1: Fraser and Neave, Limited
ZVI) FRASER AND NEAVE, LIMITED.
Slide 2: Important notice
Important notice Certain statements in this Presentation constitute “forward-looking statements”, including forward-looking financial information. Such forward-looking statements and financial information involve known and unknown risks, uncertainties and other factors which may cause the actual res
Slide 3: Introducing F&N
Introducing F&N FY2015 Sales 2 FY2015 EBIT 2 FY2015 Revenue by Market 2 Others Soft Others Soft Others Singapore F&N is a leading F&B 16% Drinks 19% Drinks Other 5% 22% 29% ASEAN player in Southeast S$2,104m 30% S$132m S$2,104m Dairies 26% Asia 54% Dairies 52% Malaysia Leading soft drinks Soft Drink
Slide 4: To be a leading F&B player in Southeast Asia
TO BE A LEADING F&B PLAYER IN SOUTHEAST ASIA STRENGTHEN MARKET POSITIONS IN CORE MARKETS OVERSEAS EXPANSION Strategy Strategy Strategy Strategy Maximise Drive Leverage Accelerate organic growth commercial strengths of growth opportunity excellence and strategic through with Power operational partner
Slide 5: Strengthening market positions in primary markets
Strengthening market positions in primary markets Retained Market Leadership Positions in Multiple Categories and Markets Business Key Brands Region Position (1) Malaysia Leading beverage player Soft Drinks No.1 in isotonic, water and soya segments; Singapore No. 2 beverage player Malaysia No.1 cann
Slide 6: Strengthening market positions in primary markets
Strengthening market positions in primary markets • Strengthen core brands • Put our resources to increase brand value and build brand loyalty of core brands 6 19 September, 2016
Slide 7: Strengthening market positions in primary markets
Strengthening market positions in primary markets 7 19 September, 2016
Slide 8: Regional expansion on track
Regional expansion on track Considerable untapped growth potential in Southeast Asia • Successfully seeded products in new markets: FOCUS ON THAILAND: Via ThaiBev’s distribution network CORE MYANMAR: Set up rep office; focusing MARKETS: on marketing core brands Population VIETNAM: Incorporated
Slide 9: Malaysia, Thailand: investing for future growth
Strengthening market positions in primary markets MALAYSIA, THAILAND : INVESTING FOR FUTURE GROWTH THB 300 MILLION NEW FILLING AND PACKAGING LINE MILLION In Rojana, Thailand; operational in March 2016 RM 100 MILLION NEW SOFT DRINKS PLANT MILLION Expansion in East Malaysia; doubling capacity; operati
Slide 10: New aseptic cold-filling PET bottle line and UHT line
Strengthening market positions in primary markets RM NEW ASEPTIC COLD-FILLING PET BOTTLE LINE 180 Offers new formulations and packaging formats Reduces PET resin packaging material by 40% Produces 6.5 million cases per year MILLION Artist’s impression of the facility STATE-OF-THE-ART FACILITY, Shah
Slide 11: Expand and deepen route-to-market
Strengthening market positions in primary markets EXPAND AND DEEPEN ROUTE-TO-MARKET S$ ACQUIRED VENDING MACHINE NETWORK 29 Increased brand visibility and product availability in Singapore #2 vending player in Singapore Integrated vending businesses MILLION Completed in July 2016 INTEGRATION OF SOFT
Slide 12: Strong alliance with international brands and ThaiBev Group
Strong alliance with international brands and a strategic partner to the ThaiBev Group NESTLE ThaiBev Group FY2015 Annual Sales S$6.7b • Rights to manufacture and distribute >>>>>> Carnation, Bear brand, Bear Brand Gold, F&N Group Ideal Milk and Milkmaid in the ASEAN > > > > > > FY2015 Annual Sales
Slide 13: Summary
SUMMARY 100PLUS Limited Edition Cans
Slide 14: Summary
Summary • Remains a formidable and leading F&B player in SEA • Comprehensive portfolio of heritage brands and innovative products • A strategic partner to the ThaiBev Group • Focus on • Strengthening our portfolio: marketing and product innovation, and M&A • Allocating resources: ensure capacities a
Slide 15: Analyst and media contact
Analyst and media contact: Jennifer Yu Head, Investor Relations T: (65) 6318 9231 E: jenniferyu@fngroup.com.sg Fraser and Neave, Limited
Slide 16: 9M2016 Performance Highlights
9M2016 Performance Highlights 43%1 Profit After Tax Growth Strong operating performance in the nine-month ended 30 June 2016 (“9M2016”) • Impacted by adverse foreign exchange effect • Food & Beverage EBIT up 31%; margin improved to 10%, from 7% • Dairies growth momentum continued unabated; EBIT up 6
Slide 17: Group Financial Highlights
9M2016 Group Financial Highlights Revenue Earnings before interest and tax (“EBIT”) (millions) (millions) $1,486.9 $140.8 ▼ 6.8% ▲ 26.0% Profit after tax1 Gearing (millions) (millions) $127.2 $835.0 (net cash) ▲ 42.7% ▼3.5%3 Dividend per share (interim) Earnings per share (basic)1,2 (cents) (cents)
Slide 18: 9M2016 Revenue
9M2016 Revenue Down 6.8% due to negative translation effects and competitive pricing, despite volume growth Revenue by Business Segment 9M2016 ($) Revenue by Business Segment (%) -6.8% Dairies $1,595m 55% Publg $1,487m & Print $1,487m 15% -4.6% -8.7% Beverages $853m $814m 30% 9M2016 $490m Revenue by
Slide 19: Revenue | Beverages
9M2016 Revenue | Beverages Revenue declined 9% on weaker Ringgit, competitive pricing in Malaysia and loss of Red Bull sales Beverages Malaysia (-15%; -5% in constant Volume Growth currency) (Key Brands) (%) - Volume increased 7%, despite lost sales from Red +18% +11% Bull, due to effective executio
Slide 20: Revenue | Dairies
9M2016 Revenue | Dairies Revenue fell 5%, impacted by negative translation effects and higher tactical discounts Dairies Malaysia (-10%; flat in constant Volume Growth currency) (%) - Impacted by weaker Ringgit and higher trade discounts given (in view of lower input costs) +3% +1% - Consolidated it
Slide 21: Revenue | Publishing & Printing
9M2016 Revenue | Publishing & Printing • Retail and Distribution divisions recorded revenue gains • Strong sales performance in airport retail and high street stores • Higher partwork sales in Hong Kong and Singapore • Publishing and Printing divisions revenue fell • Slow-down in demand in Education
Slide 22: EBIT Grew 26.0%
9M2016 EBIT Grew 26.0% Profit growth supported by Dairies, despite negative translation impact EBIT by Business Segment 9M2016 9M16 ($) 9M15 EBIT EBIT by Business Segment (%) EBIT Margin 12.2% Margin 9.5% Publg 7.7% 6.5% 7.0% & 7.0% 9M15 9M16 Dairies Print $82m $141m EBIT EBIT 71% -4% Margin Margin
Slide 23: EBIT | Beverages
9M2016 EBIT | Beverages Weaker Ringgit, increased pricing pressures and lost contribution from Red Bull impacted earnings Beverages Malaysia (-26%; -18% in constant EBIT currency) -18% +36% − EBIT dropped from loss of contribution from Red -18% -4% Bull, increased pricing pressures and higher -23% m
Slide 24: EBIT | Dairies
9M2016 EBIT | Dairies Earnings surged 66%; margin expansion on the back of higher contribution from Malaysia and Thailand EBIT Dairies Malaysia (+62%; +81% in constant +66% -nm- +60% currency) +62% Others - Driven by lower input costs $5m - Weaker Ringgit affected extent of earnings $1m Thai growth
Slide 25: EBIT | Publishing & Printing
9M2016 EBIT | Publishing & Printing • Losses before interest and taxation increased to $5.6m on lower revenue, investments made in an e-commerce project and foreign exchange losses EBIT 9M2015 9M2016 ($3m) ($6m) 25 Nine-month ended 30 June 2016 19 September, 2016
Slide 26: Maintained a strong financial position
Maintained a strong financial position Focused on prudent balance sheet management • Reflects the Group’s underlying operational Key Financial Ratios results following sale of brewery in Myanmar 9M2016 FY2015 • Takes into account Group’s capital position Total Equity1 $2,879m $2,556m and near-term c
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