Remy Cointreau Sa · EURONEXT:RCO
Remy Cointreau Sa — H1 2017/18 Earnings Presentation
33 slides from Remy Cointreau Sa's earnings presentation, Nov 23, 2017
Slide 1: Half-Year Results 2017/18
Half-Year Results 2017/18 (half-year ended 30 September 2017) 23.11.17
Slide 2: Introduction
Introduction MARC HÉRIARD DUBREUIL PRESIDENT 23.11.17 2
Slide 3: Key figures (as of 30 September 2017)
Key figures (as of 30 September 2017) Change Reported Organic • Sales €544.4m +6.0% +7.0% • of which Group Brands €496.1m +8.5% +9.6% • Current operating profit €134.1m +8.2% +11.8% • Current operating margin 24.6% +0.5pp +1.1pp • Net profit (Group share) €89.2m +17.3% +19.4% • Net profit (excluding
Slide 4: Business review
Business review VALERIE CHAPOULAUD-FLOQUET CHIEF EXECUTIVE OFFICER 23.11.17 4
Slide 5: Sharp increase in half-year results
Sharp increase in half-year results Accelerated sales growth: +7.0% in organic terms and +6.0% on a reported basis: • Positive momentum led by Group Brands: +9.6% in organic terms • Growth in all 3 regions, with Greater China, Russia, UK and Travel Retail being the main engines Group’s COP up 11.8%
Slide 6: Group sales
Group sales nor one if | | €m J H1 2016/17 Organic Currencies Scope H1 2017/18 Reported growth: +6.0% +7.0% -1.3% +0.3% 1 1 513.4 23.11.17 6
Slide 7: Sales growth by product division
Sales growth by product division House of Liqueurs & Group Partner Group Rémy Martin Spirits Brands Brands Total 20,0% +15.4% 15,0% +9.6% 10,0% +7.0% 5,0% 0,0% -5,0% -4.5% -10,0% -15,0% -14.3% -20,0% 23.11.17 7
Slide 8: Breakdown of Group sales
Breakdown of Group sales By Division By Region €544.4m Americas Liqueurs & Partner 41% (-2pts) Spirits Brands 24% (-2pts) 9% (-2pts) Europe/ Asia M. East/ Pacific Africa House of 28% (+3pts) 31% (-1pt) Rémy Martin 67% (+4pts) 23.11.17 8
Slide 9: Breakdown of Group sales
Breakdown of Group sales Group Brands House of Rémy Martin Liqueurs & Spirits €367.0m €129.2m Americas Americas 46% (-5pts) 41% (+2pts) Asia Asia Europe/ Pacific Europe/ Pacific M. East/ M. East/ 12% (+2pts) 37% (+3pts) Africa Africa 17% (+2pts) 47% (-4pts) 23.11.17 9
Slide 10: Current Operating Profit
Current Operating Profit Reported growth: +8.2% (€m) Currency Scope Volume Price/ A&P Others Mix +20.7 -12.9 -5.3 134.1 +12.2 123.9 -2.4 -2.1 Organic growth +11.8% 119,4 +€14.7m Sept. 16 Sept. 17 COP/Sales : 24.1% COP/Sales: 24.6% (Org: 25.2%) 23.11.17 10
Slide 11: Net Profit (Group share)
Net Profit (Group share) (€m) Net profit excluding non-recurring items Net Profit Group share Reported +17.9% Reported +17.3% +20.0% organic change +19.4% organic change 90.3 76.6 89.2 76.0 Sept. 16 Sept. 17 Sept. 16 Sept. 17 23.11.17 11
Slide 12: House of Rémy Martin
House of Rémy Martin • Organic sales growth of 15.4% (volumes +7.2%) • Greater China: strong sales growth Sales (in €millions) performance, led by high-end qualities -13.4%* -3.1%* +5.1%* +15.4%* 450 • United-States: H1 growth somewhat muted by 367.0 very high comps in the 1st quarter; ongoing 313.1
Slide 13: Rémy Martin
Rémy Martin The House of Rémy Martin opened its doors 2nd opus of the limited edition in Shanghai and in Moscow to educate “Carte Blanche à Baptiste Loiseau” on Rémy Martin XO and its Opulence table 23.11.17 13
Slide 14: Louis XIII
Louis XIII The Legacy : 500 crystal magnum decanters signed by the four generations of cellar masters 23.11.17 14
Slide 15: Louis XIII
Louis XIII Co) REMY COINTREAU ¢ LOUIS XIII PRESENTS PHARRELL WILLIAMS 100 YEARS OUT IN NOV 2117 #IFWECARE
Slide 16: House of Rémy Martin
House of Rémy Martin Current Operating Profit (€m) Reported growth: +13.3% Currency Volume Price / Others A&P Mix +18.1 -11.5 +19.2 -7.8 115.5 101.9 -4.4 Organic growth +17.6% +€18.0m Sept. 16 Sept. 17 COP/sales: 31.6% COP/Sales: 31.5% (Org: 32.2%) 23.11.17 16
Slide 17: Liqueurs & Spirits
Liqueurs & Spirits • Organic sales decline of 4.5% (volumes -9.5%) • Organic growth was +4.7% adjusted for the deconsolidation of Passoã Cointreau Sales (in €millions) • Good performance in the United States +8.7%* -8.3%* +5.1%* -4.5%* • Fast growth in new frontier markets (Greater 150 China and Rus
Slide 18: 25th edition of METAXA Private Reserve; OCTOMORE EIGHTS
25th edition of METAXA Private Reserve OCTOMORE EIGHTS 23.11.17 18
Slide 19: Liqueurs & Spirits
Liqueurs & Spirits Current Operating Profit (€m) Reported decline: -17.8% Currency Scope Volume Price / A&P Others Mix +2.0 -2.1 27.4 -6.9 +2.6 -1.5 +1.2 22.5 Organic decline -17.5% 27,3 - €4.7m Sept. 16 Sept. 17 COP/Sales: 20.3% COP/Sales: 17.4% (Org: 17.5%) 23.11.17 19
Slide 20: Partner Brands
Partner Brands • Organic sales decline of 14.3% (volumes -1.9%) Sales (in €millions) • Evolution of the Partner Brands’ portfolio: +6.8%** -8.3%* -3.1%* -14.3%* • Decline in champagne sales (termination of 80 the distribution contract for the Piper Heidsieck and Charles Heidsieck brands) 65.5 57.6 6
Slide 21: Partner Brands
Partner Brands • Current Operating Profit: €2.5m (-8.3% in organic terms) • Decline in Current Operating Profit mainly COP (in €millions) driven by lower champagne sales 5 +13.5%** +41.2%* -15.8%* -8.3%* 3,9 4 3,3 3 2,7 2,5 2 1 0 Sept 2014 Sept 2015 Sept 2016 Sept 2017 * Croissance organique; ** Pro
Slide 22: Financial results
Financial results LUCA MAROTTA CHIEF FINANCIAL OFFICER 23.11.17 22
Slide 23: Current Operating Profit
Current Operating Profit Reported Organic (€m) 2017 2016 change change Sales 544.4 513.4 +6.0% +7.0% Gross profit 365.8 339.1 +7.9% +9.5% in % 67.2% 66.0% +1.2pp +1.6pp Sales and marketing expenses (191.1) (175.3) +9.0% +10.0% Administrative expenses (41.3) (40.4) +2.2% +0.3% Other income and expens
Slide 24: Current operating margin
Current operating margin Reported COP/Sales: +0.5 pp +1.6 pp -1.1 pp +0.6 pp -0.2 pp -0.4 pp 24.1% 24.6% Organic COP/Sales: +1.1 pp Sept. 2016 Gross A&P Distribution/ Currency Scope Sept. 2017 COP/Sales Profits others COP/Sales 23.11.17 24
Slide 25: Net profit
Net profit (€m) 2016 2017 Current Operating Profit 134.1 123.9 Other operating income (expenses) (1.8) - Operating profit 132.3 123.9 Net financial income (charge) (8.8) (15.5) Pre-tax profit 123.5 108.4 Taxes (34.5) (32.3) Tax rate 27.9% 29.8% Share profit (loss) of associated companies and Minorit
Slide 26: Non-recurring items
Non-recurring items (€m) 2017 2016 Net profit – Group share 89.2 76.0 Provision for reorganisation of the distribution network 1.9 - Taxes related to « Other operating income and expenses » (0.3) - 3% tax on cash dividends - 0.4 Others (0.4) 0.2 Net profit excluding non-recurring items – Group share
Slide 27: Net debt/Cash flow
Net debt/Cash flow (€m) 2017 2016 Change Opening net financial debt (1 April) (390.1) (458.2) 68.1 Gross operating profit (EBITDA) 146.1 134.0 12.1 WCR of eaux-de-vie and spirits in ageing process (28.7) (31.2) 2.5 Other working capital items (63.6) (76.5) 12.9 Capital expenditure (14.2) (18.9) 4.7
Slide 28: Net financial expenses
Net financial expenses (M€) 2017 2016 Gross debt servicing costs (5.2) (11.5) Depreciation (OCEANE bond) (1.9) (0.2) Sub-total (7.1) (11.7) Net currency gains (losses) 0.7 (1.4) Other financial expenses (net) (2.4) (2.4) Net financial income (charges) (8.8) (15.5) 23.11.17 28
Slide 29: Foreign exchange: hedging impact
Foreign exchange: hedging impact 1.30 Hedged rate €/$ Average €/$ 1.23 1.27 1.16 1.14 1.11 1.14 1.12 1.10 1.10 2014/2015 2015/2016 2016/2017 2016/2017 2017/2018 March March Sept. March Sept. 23.11.17 29
Slide 30: Balance sheet at 30 September 2017
Balance sheet at 30 September 2017 Assets Liabilities (M€) Sept in % Sept in % Sept in % Sept in % 2017 2016 2017 2016 Non-current Shareholders’ 970 40% 880 35% 1 336 56% 1 186 48% assets Equity Current 1 389 58% 1 382 56% Current and assets Non-current 593 25% 628 25% liabilities o/w inventories 1
Slide 31: Key events during the half-year
Key events during the half-year • 25 July 2017 The Shareholders' Meeting approved the payment of an ordinary dividend of €1.65 per share for the 2016-17 financial year, with an option for the payment of the entire dividend in shares. 70% of the rights were exercised by the shareholders in favour of
Slide 32: 2017/18 full-year outlook
2017/18 full-year outlook • Strong increase in half-year results • Rémy Cointreau confirms its guidance of growth in Current Operating Profit over the fiscal year 2017/18, assuming constant exchange rates and scope 23.11.17 32
Slide 33: Q&A
23.11.17 Q&A