Australian Vintage Ltd · ASX:AVG
Australian Vintage — FY2023 Earnings Presentation
20 slides from Australian Vintage's earnings presentation, Aug 25, 2023
Slide 1: FY 2023 Full Year Results
FY 2023 FULL YEAR RESULTS August 2023 Presenters: Craig Garvin, CEO Adam Rigano, CFO
Slide 2: Disclaimer
Disclaimer The presentation has been prepared by Australian Vintage Limited (ACN 052 179 932) (“AVG”) (including its subsidiaries, affiliates and associated companies) and provides general background information about AVG’s activities as at the date of this presentation. The information does not pur
Slide 3: Highlights: full year 2023 results
Highlights: full year 2023 results AVG strategic plan on track despite tough trading conditions • Revenue of $258.6m in line with prior year • AVG continued to win market share, take price and grow the mix of the premium portfolio • Innovation and premium brands represent over 35% of margin • Global
Slide 4: Highlights: full year 2023 results
Highlights: full year 2023 results Industry characterised by low margins, heavy discounting and one of the lowest vintages in decades Hyperinflation absorbed EBITDAS (underlying) EBITS (underlying) $18M $26.1M $10.6m Pre-tax costs largely sea freight and energy costs In line with guidance In line wi
Slide 5: Our strategic plan continues to position us well for growth
Our strategic plan continues to position us well for growth Consumers and Brands Markets and Customers People ESG Return on Assets 5
Slide 6: Investment in brands, premiumisation and innovation offset declines in value segment
Investment in brands, premiumisation and innovation offset declines in value segment Pillar brands maintain 78% of Premiumisation strategy is Winning in key geographies Summary total revenue working $M Sales • Portfolio growth in line with strategic plan +16.0% +1pp • Price taken 106.8 106.2 +3% • G
Slide 7: Strategic plan driving incremental value with innovation and premiumisation now over 35% of margin
Strategic plan driving incremental value with innovation and premiumisation now over 35% of margin • Premiumisation of pillar brands represents 15% of revenue and 21% of margin, double their contribution from FY20 Portfolio mix contribution to revenue 1% Drinks/ Collabs • Global leadership in No and
Slide 8: External operating environment
External operating environment • FY 23 wine export value declines 10%, Europe declines 15% and North America declined 14% • 2021 and 2022 vintages oversupply, lower exports, generating unsustainable grape sourcing and marketplace behaviour • Hyperinflationary costs of $18m, from sea freight and ener
Slide 9: ESG underpinning our business strategy
ESG underpinning our business strategy 9
Slide 10: Climate action towards Net Zero
Climate action towards Net Zero AVL is committed to NET ZERO carbon emissions by 2040, across Scopes 1, 2 & 3. We have taken a science backed approach, to be validated by the Science Based Targets Initiative. = 42% wee" Q NET ZERO ~ oO Across Scopes re) Reduction in Scope 1,2 and 3 SCIENCE (e) 3 GHG
Slide 11: ESG highlights
ESG highlights • Vineyards and winery sites certified with Sustainable Winegrowing Australia. • Sustainable packaging initiatives to reduce weight, increase recycled content and encourage recycling. • B Corp impact assessment submitted for global certification • Highest standards of social and envir
Slide 12: ESG highlights
ESG highlights People are our highest priority • Employee engagement at Top Quartile • Behaviours led inclusive culture - Drinks Association 2023 Most Improved Gender Equity Award • Gender pay gap reduced from 9% to 4% • Safety and wellbeing cultural improvement with a 41% reduction in TRIFR • Marke
Slide 13: Leverage assets, know-how and raw alcohol surplus to support high margin growth
Leverage assets, know-how and raw alcohol surplus to support high margin growth Collaborations Drinks Pillar Brands Drinks business and collaborations have achieved over 7k distribution points in a short time and growing whilst positively contributing to the bottom line 13
Slide 14: Underlying income statement
Underlying income statement Result impacted by short term hyper-inflationary costs $m FY23 FY22* Fav/ (Unfav) % Underlying FY22 to FY23 EBITS $ million Revenue 258.6 260.1 (1) 9.2 EBITDAS 26.1 45.7* (43) -3.5 EBITDAS margin (%) 10.1 17.5 (42) 30.7 Depreciation and (15.5) (14.9) (4) Amortisation -7.4
Slide 15: Short term hyper-inflationary pressures of $18m absorbed in underlying performance
Short term hyper-inflationary pressures of $18m absorbed in underlying performance Total Revenue EBITDAS EBITS $258.6m $26.1m (underlying) $10.6m (underlying) Other Pillar Brands 300 50 40 250 40 30 200 30 150 45.9 45.7 20 20 35.4 31.2 30.8 100 65% 71% 78% 78% 29.7 60% 26.1 10 21.7 21.0 50 10 10.6 0
Slide 16: Reported income statement
Reported income statement Asset sales partially offset short term hyper-inflation and winery under-utilisation $m FY23 FY22 Fav/ (Unfav) % Reported FY22 to FY23 EBITS Revenue 258.6 260.1 (1) $ million 28.8 EBITDAS 32.8 43.7 (25) 17.3 EBITDAS margin (%) 12.7 16.8 (24) Depreciation and (15.5) (14.9) (
Slide 17: Strong balance sheet with NTA $0.90 per share, post assets sales
Strong balance sheet with NTA $0.90 per share, post assets sales % change FY23 FY22 FY23 FY22 (improvements in $m FY23 FY22 Reported Underlying Work Cap noted at +ve change) Net Debt (excl leases) $m 48.1 74.5 48.1 74.5 Cash & equivalent 6.9 2.5 176% Facilities Available $m 89.4 106.3 89.4 106.3 Rec
Slide 18: Cash flow
Cash flow Proceeds from asset sales driving down debt, operating cash flow impacted by hyper-inflation $m FY23 FY22 Net cash from operations FY22 to FY23 Net cash from operations (12.7) 15.4 $ million PPE & intangibles (10.8) (11.6) Asset sales 68.2 1.9 15.4 Net investing cash flows 57.4 (9.7) Free
Slide 19: Outlook and strategic plan
Outlook and strategic plan AVG remains profitable with a sustainable business model standing up against significant headwinds • Business fundamentals well placed for future • Continued investment in marketing, innovation, premiumisation and people, driven by consumer needs • Rest of Asia and China f
Slide 20: Australian Vintage
AUSTRALIAN VINTAGE ee