Purcari Wineries Public Co., Ltd. · BVB:WINE
Purcari Wineries Public — FY2022 Earnings Presentation
37 slides from Purcari Wineries Public's earnings presentation, Mar 1, 2023
Slide 1: Purcari Wineries 2022 Preliminary Results
Purcari Wineries Public Company Limited BVB: WINE Corporate Presentation 2022 Preliminary Results 1st of March 2023 Page 1 1
Slide 2: Disclaimer
Disclaimer THIS PRESENTATION IS MADE AVAILABLE ON THIS WEBSITE BY PURCARI WINERIES PUBLIC COMPANY LIMITED (the Company) AND IS FOR INFORMATION PURPOSES ONLY. This presentation and its contents do not, and are not intended to, constitute or form part of, and should not be construed as, constituting o
Slide 3: Today's presenters
Today’s presenters Victor Bostan Eugen Comendant Victor Arapan Eugeniu Baltag Victoria Moldovan Vasile Tofan Chief Executive Officer, Chief Operating Officer Chief Financial Officer Investor Relations Manager Investor Relations Officer Chairman of the Board Founder ▪ Founder of the ▪ Over 15 years o
Slide 4: Today's agenda
Today’s agenda Negru de Purcari 2019 Nominated by Caroline Gilby, Master of Wine, for the Decanter Magazine, Wines of the 1 Purcari Wineries Group Key Info Year 2021: The Top Classic Wines, with a score of 93 pts. 4.4 score on Vivino, 2 Q4 2022 Operational Results ranked among the top 1% wines globa
Slide 5: Purcari Wineries Group at a glance
1 Purcari Wineries Group at a glance Leading wine player in Central and Eastern Europe... … with a strong & expanding regional footprint Founded in 1827 by French colonists, Purcari group is now... Geographical breakdown of sales in value terms for 2022, % RO MD PL UA CN Other #1 World’s most awarde
Slide 6: Strong track record of growth year to year
1 Strong track record of growth year to year Sustainable profitability accompanying strong growth Comments ▪ IPO’d on Bucharest Stock Exchange in February 2018 2017 2018 2019 2020 2021 2022 Revenue 142.3 168.1 199.1 203.7 248.1 302.5 ▪ 75% increase in revenues since pre-IPO CoS (74.5) (85.5) (100.2)
Slide 7: Our business model: Affordable Luxury
1 Our business model: Affordable Luxury Modern cost-competitive winemaking Purcari is positioned at the intersections of three themes: ▪ Modern winemaking: the company is a brand, as opposed to appellation-centric and runs a cost-efficient business. ▪ Affordable luxury: as an aspirational brand, Pur
Slide 8: Quality highly commended; most awarded winery in CEE
1 Quality highly commended; most awarded winery in CEE in 2021 Leading medal-winning winery in CEE at Decanter, Increasing number of medals won from year to year, the Wine ”Olympics” In 2021 the most awarded winery in the World # of Decanter medals in 2015 − 2022 # of medals #1 Mundus Vini 129 Conco
Slide 9: Topping competition at engagement and quality
1 Topping competition at engagement and quality Aspirational brand which consumers like sharing about Highest number of ratings and highest scores on Vivino Number of #brand uses on Instagram, thousand, by key Romanian brands X axis – number of Vivino ratings; Y axis – average Vivino score 14.5 4.2
Slide 10: Vivino feedback remains very strong, essential for online sales
1 Vivino feedback remains very strong, essential for online sales #1 presence in the crucial RON 30-60 segment, holding 14 out of TOP-25 positions #1 ▪ We remain obsessed with the quality of our wines, which pays off in excellent consumer feedback. ▪ In our core premium segment, 30-60 RON per bottle
Slide 11: Growth in Vivino usage
1 Growth in Vivino usage, key for consumer engagement, ecommerce 4.22 80% Top 1% Average score out of Scores equal or Global ranking based on 5.0 in 12M 2022 above 4.0 avg. score received 132,053 +10% 122 Vivino scans in 12M 2022 YoY scans # of countries where 12M 2022 Purcari has been scanned Page
Slide 12: Today's agenda
Today’s agenda Viorica de Purcari 2020 A velvety wine with a fresh, memorable aroma 1 Purcari Wineries Group Key Info of acacia and basil flowers. Gold at Decanter World Wine Awards 2022, Gold at International 2 Q4 2022 Operational Results Wine & Spirit Competition 2022 3 Guidance 4 Purcari Wineries
Slide 13: Continuous growth in 2022
2 Continuous growth in 2022 Revenues EBITDA Net Income RON m RON m RON m +22% +27% 302 96 59 57 141 51 248 141 75 82 63 262 41 46 199 204 65 38 43 60 169 54 142 29 33 42 2017 2018 2019 2020 2021 2022 2017 2018 2019 2020 2021 2022 2017 2018 2019 2020 2021 2022 (1) RON 14 million one-off gain from bar
Slide 14: Key operational highlights for 2022
2 Key operational highlights for 2022 ▪ Revenue up 22% YoY to RON 302.5m exceeding the guidance, with Core Wine revenues +18% YoY and Ecosmart contributing additionally with 4% YoY. Ongoing organic ▪ Concluding the year on a high note, with a robust +26% in revenues in 4Q22 YoY. Incorporating effect
Slide 15: P&L: Strong performance despite inflationary pressures, geopolitics
2 PL: Strong performance, despite inflationary pressures, geopolitics Comments 4Q 12M RON m 2022 2021 ∆ 4Q 2022 2021 ∆ 12M ▪ Gross margin at 43% in 2022, with 4Q22 margins up 2pp Revenue 102.7 81.7 26% 302.5 248.1 22% vs. same period last year. Inflation, more expensive wine stock of 2020 vintage, a
Slide 16: Segment reporting: growing strong in WINE, turning around Ecosmart
2 Segment reporting: growing strong in WINE, turning around Ecosmart Purcari Group Ecosmart WINE Business RON m 2022 2021 ∆ 12M 2022 2021 2022 2021 ∆ 12M Revenue 302.5 248.1 22% 21.4 10.8 281.1 237.3 18% ▪ Overall strong performance of Cost of Sales (171.1) (132.3) 29% (16.2) (10.1) (154.9) (122.2)
Slide 17: Strong balance sheet, providing a solid footing
2 Strong balance sheet, providing a solid footing for current macro environment Cash Position Net Debt RON m RON m 50.8 109 98 Cash and 32.1 76 66 Receivables 21.8 23.5 46 12.6 31-Dec-18 31-Dec-19 31-Dec-20 31-Dec-21 31-Dec-22 31-Dec-18 31-Dec-19 31-Dec-20 31-Dec-21 31-Dec-22 Current Ratio Cash Rati
Slide 18: Upward trajectory in Q4, robust annual figures, amid global turmoil
2 Upward trajectory in Q4, robust annual figures, amid global turmoil Market Share of sales, 2022 ∆ ‘22/’21 YoY Comments RO 53% +20% ▪ RO: Sales surged by 45% in Q4, accounting for 34% of total annual sales. Strong double-digit growth for Purcari and Bardar. Nocturne series being a tremendous succes
Slide 19: Premium brands: Purcari and Bardar, lead the growth
2 Premium brands: Purcari and Bardar, lead the growth Jumped to #3 in overall market, reaching 10%+ share… …while distancing by 20+ percentage points vs #2 in premium Value share of TOTAL retail market, Romania, % Value share of Premium (RON 30+/liter) retail market, Romania, % 18 26 25 16 24 23 16
Slide 20: Premium Purcari and Bardar directing the growth
2 Premium Purcari and Bardar directing the growth Brand Share of sales, 2022 ∆ ’22/21 YoY Comments ▪ PURCARI: +25% YoY, with Q4 sales representing 36% of annual sales. Doubling sales YoY in Asia, Czech and Slovakia, 53% +25% albeit from a smaller base. Moldova upward trend +29%, closely followed by
Slide 21: On track for a strong 2022 harvest
2 On track for a strong 2022 harvest Good 2022 harvest Comments Own harvest and 3rd party purchases of grapes, million kg 35.1 ▪ Own vineyards fully recovered after an unprecedent draught 34.1 in 2020. ▪ High attention in maintaining the vineyards has paid off, 27.1 ensuring good health of the plant
Slide 22: Portfolio development: continue creating inspired products
2 Portfolio development: continue creating inspired products PURCARI NOCTURNE ACADEMIA PROCIANO, NATIVE WINE CRIME, BARDAR HoReCa – focused edition ambitious oeno-project adapting to wine trends expanding the growth pillars in RO ▪ Launched in 2021, a bet on ▪ Launched in 2022, ▪ PROCIANO – Alcohol
Slide 23: Outstanding results at most reputable wine competitions
2 Outstanding results at most reputable wine competitions Best Producer from Moldova 2022 Decanter Top Classic Wines 2021 TOP 10 BEST Sparkling Wines Mundus Vini among 50 much pricier wines Effervescents du Monde 2021 Grand Gold: Rosé de Purcari Wine of the week in UK: Freedom Blend #1 Worldwide: Co
Slide 24: Continue creating, engaging, inspiring
2 Continue creating, engaging, inspiring The Secret of Bardar Cuvée de Purcari White Brut Union of the Romanian Principalities Promotional campaign for Bardar Platinum 25 A New Year campaign with one of the Top 10 A Domeniile Cuza campaign with Horia Brenciu years that emphasized the importance of t
Slide 25: Today's agenda
Today’s agenda Alb de Purcari 2020 A sensual, slightly velvety experience that seduces 1 Purcari Wineries Group Key Info your senses like a first love. Gold at Mundus Vini Summer Tasting 2022, Best in show Moldova 2 Q4 2022 Operational Results Red 3 Guidance 4 Purcari Wineries Stock 5 ESG Impact Pag
Slide 26: Guidance 2022: delivered on promise
3 Guidance 2022: delivered on promise Target 2022 guidance 2022 actual Status Comments • Revenue at RON 302.5 million in 2022, with last 3 Revenue quarters exceeding or being within the guidance. growth +15-20% +22% > Growth accelerated in 3Q and 4Q with +27% and +26% YoY. • Consumer demand for prem
Slide 27: Guidance 2023
3 Guidance 2023 Target 2023 guidance Comments ▪ Consumer demand for premium brands remains healthy, amid inflationary pressures. Revenue growth +18-22% ▪ Consumer sentiment for low and medium market brands is weakening along with disposable income. ▪ Undertaking initiatives to elevate newly added An
Slide 28: Today's agenda
Today’s agenda Malbec de Purcari 2020 A wine with strong personality; an explosion 1 Purcari Wineries Group Key Info of grace, perfect for edgy combinations. Gold at Decanter World Wine Awards 2022 2 Q4 2022 Operational Results 3 Guidance 4 Purcari Wineries Stock 5 ESG Impact Page 28
Slide 29: Purcari shares liquidity
4 Purcari shares liquidity Rapid rise of stock’s liquidity after starting working with Relative to Market Cap, our stock is top-ranked among Market Makers for Purcari shares BET components Daily volume Ratio of daily trade value to Market Capitalisation, 2021-2023 YTD average, bps BRK 1 Purcari Wine
Slide 30: EBITDA profitability relative to wine listed peers
4 EBITDA profitability relative to WINE listed peers Purcari vs selected Wine public companies EBITDA LTM Margin, % 26.9% 23.4% 17.6% 17.0% 16.7% Average margin: 13.6% 12.7% 12.2% 10.9% 10.4% 7.5% 4.4% 3.0% 1 Source: Capital IQ, Company Data as per Capital IQ as of February 9th, 2023 (1) Italian Win
Slide 31: Low valuation relative to wine peers
4 Low valuation relative to wine peers Purcari vs Selected wine public companies P/E LTM Multiples 38.2 28.8 20.6 19.7 17.5 15.8 Average P/E: 16.2x 15.1 14.4 11.3 10.1 9.3 8.9 8.4 8.4 1 Source: Net Income and Market Cap as per Capital IQ as of February 20th, 2023 Note: Diluted EPS excluding extra it
Slide 32: Average valuation relative to Romanian listed peers
4 Average valuation relative to Romanian listed peers Purcari vs selected Romanian public companies P/E LTM Multiples 47.8 25.3 Average P/E: 14.3x 10.3 10.4 8.4 7.2 7.0 7.0 5.2 1 Source: Capital IQ, Company Data as per Capital IQ as of February 20th, 2023 Note: Diluted EPS excluding extra items used
Slide 33: High growth not reflected in valuation yet
4 High growth not reflected in valuation yet Purcari vs selected wine public companies Purcari vs selected Romanian public companies 30 30 25 25 Revenue CAGR’16-21 in USD Revenue CAGR’16-21* in USD 20 1 20 15 15 2 10 10 5 5 0 0 0 10 20 30 40 0 10 20 30 40 50 P/E Multiple P/E Multiple Source: Capital
Slide 34: Today's agenda
Today’s agenda Cuvée de Purcari White Brut An exceptional blend, 1 Purcari Wineries Group Key Info ennobled with a citrus flavor and a complex taste with peach nuances. Gold at Vinarium International Wine 2 Q4 2022 Operational Results Contest 2022, Top 10 Best Sparkling Wines from Effervescent du Mo
Slide 35: ESG Impact
5 ESG Impact Purcari Wineries is building up its foundation in sustainability and ESG management, by aligning its business and model to the UN Sustainable Development Goals (SDGs). ENVIRONMENT SOCIAL GOVERNANCE ▪ Launched the irrigation system at Purcari ▪ Launched Purcari Foundation in July ▪ Havin
Slide 36: Learn more about our products
Learn more about our products Page 36
Slide 37: Thank you!
Thank you!
Purcari Wineries Public Company — FY2022 Earnings Presentation on 6ix