Slide 1: Q3 2023 results
Q3 2023 results 27 October 2023 − Henri de Sauvage-Nolting, President/CEO − Frans Rydén, CFO
Slide 2: Agenda
Agenda 1. Quarterly update 2. Financials 3. Strategic update 4. Q&A 2
Slide 3: Key messages
Key messages Another strong quarter for Cloetta • Strong double-digit organic growth in Branded, primarily driven by pricing • Strong double-digit organic growth in Pick & mix, despite a large customer in the UK going into administration • Higher adjusted operating profit; primarily attributable to
Slide 4: Financials
Financials 4
Slide 5: Net sales
Net sales Double-digit growth in both segments driven by pricing to offset cost inflation Third quarter 9 months +19.5% +23.3% + 7.3% 2 148 + 6.2% 6 119 + 17.1% + 12.2% 1 798 4 964 Branded +10.9% Branded +15.1% packaged packaged Pick & mix +16.4% Pick & mix +23.5% Q3 ’22 Organic growth FX Q3 ’23 202
Slide 6: Sales development
Sales development 20.5% Branded, % of Q3 ‘23 sales 14.8% 9.3% 10.2% 10.9% 7.3% 8.2% 6.1% 2.5% 4.0% 2.5% 1.7% -2.5% -3.6% -6.3% 75% Q1’20 Q2’20 Q3’20 Q4’20 Q1’21 Q2’21 Q3’21 Q4’21 Q1’22 Q2’22 Q3’22 Q4’22 Q1’23 Q2’23 Q3’23 Pick & mix, % of Q3 ’23 sales 79.6% 32.4% 32.7% 25% 21.6% 23.8% 24.4% 22.4% 16.
Slide 7: Operating profit, adjusted
Operating profit, adjusted Increased profit driven by pricing to offset higher input cost Operating profit, adjusted • Pricing execution to offset inflation and negative currency effects in Third quarter 9 months Sweden and Norway. Year-to-date 9.7% 9.8% improvement also reflect that last 208 599 10
Slide 8: Operating profit, adjusted, by segment
Operating profit, adjusted, by segment Branded packaged profit improved while negative one-off primarily impacting Pick & mix Third quarter 9 months 13.6% 13.3% 13.1% 12.9% 216 586 186 30 489 97 Branded packaged Q3 ’22 var. Q3 ’23 2022 var. 2023 0.5% -1.5% 1.6% 0.8% 19 15 -21 Pick & mix 13 2 11 -21
Slide 9: SG&A
SG&A Cost driven by annual salary increases across markets and currency translation effect Third quarter 9 months 21.0% 19.7% 24.3% 21.6% -46 -117 -4 -4 -377 -25 -1 204 -55 -17 -58 -423 -1 321 Q3 ’22 Items FX Net SG&A Q3 ’23 2022 Items FX Net SG&A 2023 affecting affecting comparability comparability
Slide 10: Cash flow
Cash flow SEK 123m in free cash flow, lower than last year for the quarter but higher for the year-to-date 208 Q3 ‘23 • Lower Free cash flow vs last year is -15 -70 primarily due to last year’s reduction in 123 2 106 working capital. Year-to-date, however, -19 both working capital and Free cash flow
Slide 11: Financial position
Financial position Continued strong financial position • Leverage at 2.0x remains below long-term target of 2.5x and lower than Q3 2022 • Net debt decrease driven by favourable unrealised revaluation impact and generated cash • Unutilised access to cash of SEK 3.7bn 4,5 5 000 Access to cash 3.7 Cove
Slide 12: Strategic update
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Slide 13: Greenfield project proceeding with new estimated timeline
Greenfield project proceeding with new estimated timeline • The regulatory process taking longer than anticipated – expected new timeline • Conditional purchase agreement land now signed • City council started permitting process review • Permit expected to be received 2024 • Major planned investment
Slide 14: UK candy market £2.1bn, approx. 1% P&M compared to ~20% in Nordics
UK candy market £2.1bn, approx. 1% P&M compared to ~20% in Nordics Cloetta UK Brands £15m Cloetta CandyKing Pick & mix £17m Launched in 1965, Chewits was one of the first chewy sweets in the UK + Chewits is a household YTD growth in stores (ex-Wilko) name with 81% Brand Awareness amongst UK Consumer
Slide 15: Sustainability: Vegan & on pack Portion Control
Sustainability : Vegan & on pack Portion Control VEGAN candy portfolio towards PORTION CONTROL information on all candy bags to be rolled out in of total assortment by 2030 ACHIEVEMENTS SO FAR: ACHIEVEMENTS SO FAR: • Rolling out transparent on pack communication, encouraging responsible consumption
Slide 16: Grow our Top Brands
Grow our Top Brands Sweden's #1 Candy Brand Ahlgrens Bilar Pack re-design to modernize the brand, Distinctive communication with new strengthen ownables and ensure better shelf advertising adressing younger audience and stand out helping to beat the market growth Old New Launched in a sustainable pa
Slide 17: Grow our Top Brands
Grow our Top Brands enter new occasions & roll out proven innovation SKIPPER’S MINI PIPES –TAPPING INTO NEW POPS CHOCO BITES: EXPAND THE BRAND OCCASIONS WITH SMALLER SHAPE AND BAG BY LAUNCHING A FINNISH SUCCESS UNDER FORMAT POPS NORWAY Skipper's Pipes value sales since launch vs year ago +73% W33-40
Slide 18: Q&A
Q&A 18
Slide 19: Thank you!
Thank you!
Slide 20: Appendix
Appendix 20
Slide 21: Greenfield facility – Pro forma profit and loss Q3
Greenfield facility – Pro forma profit and loss Q3 Q3 2023 Q3 2023 Q3 2023 Other items Pro-forma Greenfield affecting Reported excl. Adjusted comparability greenfield Net sales 2.148 - 2.148 - 2.148 Cost of goods sold -1.524 -3 -1.521 - -1.521 Gross profit 624 -3 627 - 627 Selling expenses -248 - -2
Slide 22: Greenfield facility – Pro forma profit and loss YTD
Greenfield facility – Pro forma profit and loss YTD YtD Q3 2023 YtD Q3 2023 YtD Q3 2023 Other items Pro-forma Greenfield affecting Reported excl. Adjusted comparability greenfield Net sales 6.119 6.119 - 6.119 Cost of goods sold -4.237 -27 -4.210 - -4.210 Gross profit 1.882 -27 1.909 - 1.909 Selling
Slide 23: Disclaimer
Disclaimer • This presentation has been prepared by Cloetta AB (publ) (the “Company”) solely for use at this presentation and is furnished to you solely for your information and may not be reproduced or redistributed, in whole or in part, to any other person. The presentation does not constitute an