Pernod Ricard SA · EURONEXT:RI
Pernod Ricard SA — Q3 2009/10 Earnings Presentation
40 slides from Pernod Ricard SA's earnings presentation, Apr 29, 2010
Slide 1: 2009/10 3rd Quarter Sales
2009/10 3rd Quarter Sales Marked upturn in 3rd quarter Increase in 2009/10 full-year guidance 29 April 2010 This presentation can be downloaded from our website: www.pernod-ricard.com 1
Slide 2: Presentation structure
Presentation structure - Overall analysis - Portfolio review - Growth by region - Conclusion and outlook 2
Slide 3: Macroeconomic environment at 31 March 2010
Macroeconomic environment at 31 March 2010 Acceleration of growth in new economies Economic upturn in Russia, Korea and Duty Free markets Early signs of improvement in the US Contrasting situations in Western Europe: unemployment and public finances (Greece) remain causes for concern 3
Slide 4: Key figures at 31 March 2010
Key figures at 31 March 2010 Marked upturn with 16% growth* in Q3 Sales on comparatives that are now favourable organic decline of 3% in HY1 becoming 2% growth at 31 March Stronger performance by Top 15 with a highly favourable mix/price effect Top 15 Volume Value HY1 09/10 -5% -3% Q3 09/10 +13%
Slide 5: Sales analysis on Q3 09/10
Sales analysis on Q3 09/10 (€ millions) 30 (45) 208 1,538 1,345 +2% -3% +16% +14,4% 08/09 Organic Forex Group 09/10 Q3 sales growth effect structure Q3 sales Organic growth +16% (Spirits = +18%, Wines = +5%) of which +21% for Top 15 very good quality of growth mix The forex effect turned posit
Slide 6: Main technical effects of Q3 09/10
Main technical effects of Q3 09/10 Q3 09/10 sales growth positively impacted by: + Significant destocking by distributors in Q3 08/09, especially in the US, Russia and Spain + Later celebration of Chinese New Year (14 Feb. 2010 vs 29 Jan. 2009) + Sales before price / excise duty increases in the UK,
Slide 7: Sales analysis at 31 March 2010
Sales* analysis at 31 March 2010 (€ millions) 87 5,557 (154) +2% (164) -3% 5,326 -3% -4% 08/09 Organic Forex Group 09/10 9-month sales growth effect structure 9-month sales Organic growth: +2% (Spirits = +3%, Wines = -5%) Forex effect primarily due to Venezuela and the depreciation of the USD an
Slide 8: Main technical effects at 31 March
Main technical effects at 31 March Beyond some of the technical effects for Q3 09/10, 9-month cumulative sales growth at 31 March was affected by: - Chivas: distribution taken back in Japan as of 1 October 2009 no deliveries to Kirin in Q1 2009/10 - Mumm: Q1 2008/09 very positively affected by Jul
Slide 9: Organic sales growth by quarter over 2008/09 and 2009/10
Organic sales growth by quarter over 2008/09 and 2009/10 10 +7% 5 +3% 0 -5 -3% -10 -15 -12% -20 Q1 Q2 Q3 Q4 08/09 08/09 08/09 08/09 20 +16% 15 10 5 0 -5 -2% -4% -10 Q1 Q2 Q3 09/10 09/10 09/10 9
Slide 10: Presentation structure
Presentation structure - Overall analysis - Portfolio review - Growth by region - Conclusion and outlook 10
Slide 11: Analysis of portfolio organic growth
Analysis of portfolio organic growth* Q3 09/10 9 months 31 March 2010 Top 15: Spirits +23% +4% Top 15: Wines & Champagnes +10% -5% Top 15 +21% +3% 30 key local brands +14% +4% Other +3% -4% Total +16% +2% Highly favourable mix, especially in Q3 Premium** brands represented 70% of sales at end March
Slide 12: Portfolio review
Portfolio review TOP 15 Volume: -1%* Sales: +3%* % of Group sales: 58% *Organic growth calculated over 8 months from August to March for Absolut 12
Slide 13: Absolut: Volume +8% Sales +9%
Volume* +8% Sales* +9% Shipments up 19% in Q3 2009/10 (Q3 2008/09 affected by destocking) Positive price/mix effect overall due to price increases in numerous markets, despite the downward pricing adjustment in the US The US, improving trend: Q3 09/10 depletions at -1% vs -4% over 9 months (Q3
Slide 14: Chivas Regal: Volume -4% Sales +1%
Volume -4% Sales* +1% Very strong upturn in Q3 (volume +30%) Highly favourable price/mix effect Europe: improvement in Q3, especially in Russia, Spain and Romania. Very good performance in France and in the UK Americas: signs of improvement in the US. Back to business as usual for Duty Free
Slide 15: Ballantine's: Volume -6% Sales -7%
Volume -6% Sales* -7% Ballantine’s Finest (volume -6%): decline in Spain, Germany and Italy but moderate increase in France and strong growth in Poland and on Duty Free Ballantine’s Superior Qualities (volume -10%): decline in China (price repositioning) but sharp rebound in Q3 (later Chinese Ne
Slide 16: Martell: Volume +9% Sales +16%
Volume +9% Sales* +16% Martell VS -16%, Noblige +41%, Cordon Bleu +18% Outstanding double-digit growth in Asia, driven by China (+25%), including a very good Chinese New Year, Vietnam, Taiwan and the Philippines Stronger quality mix effect in Q3 Success of XO campaigns in China (TV) and Russia
Slide 17: Jameson: Volume +8% Sales +11%
Volume +8% Sales* +11% US: continuing very strong increase in depletions (+25%), confirmed by Nielsen (+17% in volume) Europe: slight decline in Ireland and gradual recovery in Eastern Europe (Russia). Good performance in France and Scandinavia Slight growth in South Africa Major success of
Slide 18: Havana Club and The Glenlivet
& Volume -1% Sales* +3% Rebound in Q3 09/10 (volume up 10%) 9-month sales: decline in Cuba and Italy, stability in Spain and Germany and satisfactory growth in other key markets: Chile, France, Greece, Canada, UK Launch of the "HAVANA-CULTURA" digital platform with Jazz DJ Gilles Peterson Volu
Slide 19: Ricard and Beefeater
& Volume +2% Sales* +3% France: good performance due to off-trade market share gains (Nielsen volume +2.5% in a market +0.4%), offsetting an on-trade situation that remained difficult Overall stability in all other European markets Volume -3% Sales* -1% Spain: good resilience and market share
Slide 20: Malibu and Kahlua
& Volume -2% Sales* -2% US: depletions +4% (Nielsen -2%) Decline in main European markets (UK, Spain, France and Germany) but improving trend in Q3 (volume +5%) Good performance of the "Radio MaliBoomBoom.com" digital platform Volume -5% Sales* -5% Liquor market still difficult US: depleti
Slide 21: Jacob's Creek and Montana
& Volume -7% Sales* -2% Continuing decline in the UK: continuing implementation of the value strategy, with premium range growth and a highly selective policy of participating in promotional campaigns Growth in other, more profitable markets: Australia, US (Nielsen +3%) and China Further press
Slide 22: Champagnes: Mumm and Perrier-Jouet
& Champagnes: improvement in Q3 Patrick Jouin’s Mumm Ice Bucket Volume -11% Sales* -9% Volume Q3 +3% France: • Improving trend in the off-trade (Nielsen +4% in Q3) • Ongoing difficulties in the on-trade Decline in most other markets, including Italy, the UK and the US but good growth in Japan Vo
Slide 23: 30 key local brands
30 key local brands Confirmed resilience of the 30 key local brands, reporting 3% growth in volume and 4%* growth in value at end March 2010 • Strong recovery of Royal Salute in Asia in Q3, • renewed growth by Imperial in South Korea (+8% as of March 2010), • and continuing very strong growth of l
Slide 24: Presentation structure
Presentation structure - Overall analysis - Portfolio review - Growth by region - Conclusion and outlook 24
Slide 25: Analysis of organic growth by region
Analysis of organic growth* by region Very strong Sales growth in all regions in Q3, including • overall increase in consumption, especially in Asia • favourable technical effects: destocking in Q3 08/09, Chinese New Year, etc. Q3 09/10 9 months 31 March 2010 Asia – Rest of World +28% +10% America
Slide 26: Asia – Rest of World
Asia – Rest of World 9 months 9 months Organic Forex Group (€ millions) 08/09 09/10 growth effect structure Sales 1,588 1,746 +10% +1% - Asia: accelerating growth • Very strong growth in India (+29%*), China (+15%*) and Vietnam (+75%*) • Duty Free recovered and posted strong growth in Q3, with a s
Slide 27: Americas
Americas 9 months 9 months Organic Forex Group (€ millions) 08/09 09/10 growth effect structure Sales 1,528 1,369 +3% -8% -4% US: • Stable depletions over 9 months. Following Q1 growth and a decline in Q2, further growth was reported in Q3. Encouraging Nielsen (+1.3%) and NABCA statistics over Q3
Slide 28: Europe (excluding France)
Europe (excluding France) 9 months 9 months Organic Forex Group (€ millions) 08/09 09/10 growth effect structure Sales 1,908 1,686 -6% -2% -4% In spite of a largely technical rebound in Q3, the situation remained difficult (rise in unemployment and decline in consumption in many countries) Impro
Slide 29: France
France 9 months 9 months Organic Forex Group (€ millions) 08/09 09/10 growth effect structure Sales 533 525 +1% - -2% Pernod Ricard performed well in the French market with: • Good resilience of the off-trade market, combined with a slower on-trade decline • Market share gains, supported by sustai
Slide 30: Asia & RoW becomes the Group's leading region
Analysis of sales by geographic region 9 months 08/09 9 months 09/10 10% France 10% 29% 33% Europe Americas 34% 32% Asia and RoW 27% 25% Asia & RoW becomes the Group’s leading region 30
Slide 31: Share of new economies at 31 March
Share of new economies* at 31 March Sales Sales 9 months 2008/09 9 months 2009/10 31.5% 33.2% New economies* Mature 66.8% 68.5% markets Acceleration of organic growth in new economies*’ markets: +9% at end March 2010 and +29% over Q3 2009/10 (strong consumption + technical effects) Strong presen
Slide 32: Conclusion and outlook
Conclusion and outlook SS Oa SO
Slide 33: Conclusion on sales at 31 March
Conclusion on sales at 31 March Organic sales growth +2% at 31 March primarily driven by Top 15 spirits (+4%) Marked upturn in Q3 (+16%*), due to: • Very good performance of premium brands (better than standard categories) • Strong increase in consumption in new economies • Improved underlying b
Slide 34: 2009/10 full-year outlook
2009/10 full-year outlook New 2009/10 full-year guidance: organic growth of about +3% in profit from recurring operations (vs +1% to +3% previously) Confirmed reinforcement of advertising and promotion expenditure on strategic brands and markets 34
Slide 35: Pernod Ricard
3% Pernod Ricard / 2s Pernod Ricard
Slide 36: Appendices
My ~ hs Q. Pernod Ricard Appendices OS
Slide 37: Strategic brands growth
Strategic brands growth Volume organic Net Sales organic growth (*) growth (*) Absolut 8% 9% Chivas Regal -4% 1% Ballantine's -6% -7% Ricard 2% 3% Martell 9% 16% Malibu -2% -2% Kahlua -5% -5% Jameson 8% 11% Beefeater -3% -1% Havana Club -1% 3% The Glenlivet 5% 6% Jacob's Creek -7% -2% Mumm -11% -9%
Slide 38: Sales at 31 March 2010
Sales at 31 March 2010 Net Sales YTD March YTD March Change Organic Growth Group Structure Forex impact (€ millions) 2008/09 2009/10 France 533 10% 525 10% (8) -1% 4 1% (12) -2% 0 0% Europe excl. France 1,908 34% 1,686 32% (221) -12% (106) -6% (78) -4% (37) -2% Americas 1,528 27% 1,369 26% (159) -10
Slide 39: Forex effect
Forex effect Forex impact YTD March 2009/10 Average movement in exchange rates On Net (€ millions) Sales 2008/09 2009/10 % Venezuelan Bolivar VEF 2.95 8.66 193.2% (88.4) US Dollar USD 1.37 1.43 4.1% (40.7) Chinese Yuan CNY 9.40 9.77 4.0% (16.2) Pound Sterling GBP 0.85 0.89 4.7% (13.5) Mexican Peso M
Slide 40: Group structure effect
Group structure effect Group structure YTD March 2009/10 On Net Sales (€ millions) Total Group Structure (164) Group structure: termination of Stolichnaya distribution and disposals (Wild Turkey and Tia Maria) partly offset by the contribution of Vin&Sprit in July 40