British American Tobacco Malaysia Bhd. · MYX:BAT
British American Tobacco Malaysia Bhd — Q3 2020 Earnings Presentation
17 slides from British American Tobacco Malaysia Bhd's earnings presentation, Oct 28, 2020
Slide 1: Quarter 3, 2020 Performance
QUARTER 3, 2020 PERFORMANCE 28th Oct 2020
Slide 2: Agenda
Agenda 1 Q3 Business Review and Financial Performance 2 Other Business Updates
Slide 3: Q3 Business Review and Financial Performance
Q3 Business Review and Financial Performance
Slide 4: Q3 highlights
Q3 highlights Illegal cigarette incidence +7% +14% +1.0ppt 64.5% vs Q2’20 vs Q2’20 vs Q2’20 Aug’20 +4ppt Legal domestic industry BAT domestic volume BAT share of market vs Jun’20 volume Total BAT volume including Duty Free +18% Source: CMTM Big 3 industry exchange, IPSOS Retail Audit Malaysia
Slide 5: BAT outperformed the legal domestic industry in Q3
BAT outperformed the legal domestic industry in Q3 MONTHLY AVERAGE VOLUME (MNS) +7% 564 547 Legal domestic 529 industry volume (mn sticks) 507 481 +14% 297 294 262 258 BAT domestic volume 225 (mn sticks) MCO RMCO period period Q3-19 Q4-19 Q1-20 Q2-20 Q3-20 BAT volume growth driven by strong portfoli
Slide 6: BAT share growth driven by Rothmans, KYO and Dunhill
BAT share growth driven by Rothmans, KYO and Dunhill BAT SHARE OF MARKET (%) 52.5 51.5 50.8 50.4 50.4 Q3'19 Q4'19 Q1'20 Q2'20 Q3'20 Source: IPSOS Retail Audit Malaysia
Slide 7: Strong Q3 performance
Strong Q3 performance +18% vs Q2’20 +15% vs Q2’20 +6% vs Q2’20 +17% vs Q2’20 Total BAT volume Revenue Profit from operations Earnings per share (including Duty Free) Positive portfolio results translated to improved financial results
Slide 8: Turnaround in Q2, accelerated improvement in Q3
Turnaround in Q2, accelerated improvement in Q3 Q1’20 Q2’20 Q3’20 vs Q1’19 vs Q2’19 vs Q3’19 Volumes (Domestic) -21% -16% +10% Revenue -23% -15% +7% Profit from operations -41% -22% -22%
Slide 9: Underlying YTD performance continues to be pressured by black market and downtrading
Underlying YTD performance continues to be pressured by black market and downtrading Total Volume Revenue Profit from operations mns RM’mil RM’mil -9% -10% -29% vs SPLY vs SPLY vs SPLY *Domestic performance excluding Duty Free
Slide 10: Continue to optimise cost base to support investments
Continue to optimise cost base to support investments Operating expenses (RM’mil) Restructuring expenses (RM’mil) -RM10mil -5% 100% completion 191 181 RM15 mil RM14 mil Q4’19 YTD Q3’20 YTD Q3'19 YTD Q3'20 • Cost base optimisation and resource allocation • Overheads savings from restructuring • Strat
Slide 11: Dividend payout for Q3 2020
Dividend payout for Q3 2020 Earnings per share 22.3 sen +17% vs Q2 Dividend per share 21.0 sen +11% vs Q2 Payout ratio 94% Payment scheduled for 25th Nov 2020 * Based on last 3 quarters dividend paid out and third interim dividend 2020 declared
Slide 12: Other Business Updates
a) -) ee yy - “TD WS Se pidete ae Other Business Updates MALAYSIA
Slide 13: Q4 Focus Areas
Q4 Focus Areas Stop the Black Market Our portfolio
Slide 14: Tobacco black market crisis requires urgent action
Tobacco black market crisis requires urgent action High illegal FMC Malaysia No 1 in the world Government needs to act tobacco black market 60.5% 64.5% Jun’20 Aug’20
Slide 15: To stop the black market, a holistic approach is needed
To STOP THE BLACK MARKET, a holistic approach is needed Multi Agency Task Force operationalised with clear objectives Policy change at borders - transhipment laws / single point of entry Excise moratorium Exploration of other excise measures to reduce the price gap between the legal and black market
Slide 16: BAT Malaysia Summary
BAT Malaysia Summary Dunhill maintaining a strong share of premium segment. Rothmans and KYO growing their shares of segment Strong Q3 results, continued growth since Q2 Significant enforcement and excise reform required to STOP THE BLACK MARKET
Slide 17: End
End MALAYSIA
British American Tobacco (Malaysia) Berhad — Q3 2020 Earnings Presentation on 6ix