Vina Concha y Toro S.A. · BCS:CONCHATORO
Vina Concha y Toro — Investor Presentation (March 2011)
44 slides from Vina Concha y Toro's investor presentation, March 2011
Slide 1: Viña Concha y Toro Investor Presentation March 2011
Viña Concha y Toro Investor Presentation March, 2011 1 1/ 1
Slide 2: Concha y Toro – 7 year performance
Concha y Toro – 7 year performance * 2003 2010 7-year CAGR Sales (Ch$ million) $ 190,303 $ 374,019 10% Exports ** (Ch$ million) $ 133,472 $ 278,414 11% Exports ** (US$ million) $ 151 $ 547 20% % Exports 70.1% 74.4% Export volume ** ('000 cases) 7,802 20,514 15% Operating Result (Ch$ million) $ 27,38
Slide 3: Consolidated Sales and Sales Breakdown
Consolidated Sales Sales Breakdown Million Ch$ Average Annual Growth: 11.0% Exports 69,9% Domestic Market Wine 15,9% Domestic Market Other products 5,4% Argentina 6,9% Others 1,8% 3 3/ 3
Slide 4: Business Model: Key Factors
Concha y Toro Business Model: Key Factors Exclusive focus on Strong Strong wine Distribution Portfolio of Network: Wines across Global Reach / all market Leading segments Position in Key Markets Quality Assurance and Market Consistency: Investment Diversification Own that supports Vineyards and grow
Slide 5: Business Model: Key Factors
Concha y Toro Business Model: Key Factors Exclusive focus on Strong Strong wine Distribution Portfolio of Network: Wines across Global Reach / all market Leading segments Position in Key Markets Quality Assurance and Market Consistency: Investment Diversification Own Vineyards that supports and Proc
Slide 6: Export Sales (Bottled Wine)
Concha y Toro Export Sales (Bottled Wine) Million Ch$ Thousand US$ Average Annual Average Annual Growth: 15.1% Growth: 16.6% 543,942 483,405 453,287 403,531 294,666 2006 2007 2008 2009 2010 6 6/ 6
Slide 7: Export Sales (Chile + Argentina) – Total Volume
Concha y Toro Export Sales (Chile + Argentina) – Total Volume (Volume Cases ´000) Average Annual Growth: 12.2% 20,514 18,955 17,642 16,279 12,924 2006 2007 2008 2009 2010 7 7/ 7
Slide 8: Export Sales – Premium Wines
Concha y Toro Export Sales – Premium Wines (Volume Cases ´000) Average Annual Growth: 14.3% + 14.8% Premium wines and above 1,33% 1,27% 1,15% 4,155 19,38% 19,66% 21,23% 3,692 3,620 3,542 Super Premium & Above 2,433 Premium 79,01% 79,35% 77,62% Blend & Varietal 2006 2007 2008 2009 2010 2006 2009 2010
Slide 9: Export Sales (Average Price US$/9lt Case)
Concha y Toro Export Sales (Average Price US$/9lt Case) Average Annual Growth: 4.4% 26,90 26,30 25,99 25,77 23,45 21,73 2005 2006 2007 2008 2009 2010 9 9/ 9
Slide 10: Outperforming the Chilean Industry
Outperforming the Chilean Industry (Volume - bottled exports) Increase of 28.6% in the export of Bulk Wine to Subsidiaries to 8.4 million liters, to gain cost efficiencies in bottling in the markets. 10 10/ 10
Slide 11: Increasing market share over Chilean Exports
Increasing market share over Chilean Exports Exports of bottled wine* Volume Value 2004 29.2% 25.8% 2005 32.2% 27.2% 2006 33.4% 28.3% 2007 34.9% 30.2% 2008 37.0% 31.4% 2009 38.3% 32.3% 2010 36.6% 31.5% Source: Vinos de Chile Includes bottled & Bag in Box 11 11/ 11
Slide 12: Concha y Toro export growth by Region – by Volume
Concha y Toro export growth by Region – by Volume Region Mix of Export Sales % Change Volume Vol 2009 Vol 2010 2008 2009 2010 Continental Europe 20.3% 19.4% 11% -3% 4% Nordics (SWE, FIN, NOR) (1) 4.6% 4.9% 15% UK 27.7% 27.2% 7% 20% 6% USA 17.9% 16.2% 11% 8% -2% Canada 4.3% 4.4% 28% 2% 11% Asia 7.3%
Slide 13: Strong Distribution Network
Strong Distribution Network • 268 independent distributors (for Chilean exports) • Coverage: 135 Countries worldwide • Direct Distribution: • Concha y Toro UK (Since 2001) UK • 4.236.400 cases to Sep 2010, 27.9% of exports • Concha y Toro Nordics (Sweden, Finland & Norway – Since 2009) Nordics • 730
Slide 14: Total Chilean exports by category
Total Chilean exports by category (January – December) Jan - Dec 2010 % Change 2010/2009 Liters US$ Av. Price Liters US$ Av. Price ('000) ('000) US$/Ltr Bottled 458,498 $ 1,350,216 $ 2.94 10.7% 11.8% 1.1% Bulk 274,754 $ 201,799 $ 0.73 -1.6% 15.9% 17.8% Total 733,252 $ 1,552,015 $ 2.12 5.7% 12.4% 6.3
Slide 15: Export – New World Producers
Export – New World Producers (Bottled wine exports by volume – million liters) % Change 2007 2008 2009 2010 2010/09 Australia 579 513 471 425 -9.9% Chile 375 386 414 459 10.7% USA 235 240 205 190 -7.1% South Africa 191 224 245 230 -6.1% Argentina 189 211 222 231 3.9% 15 15/ 15
Slide 16: UK Market – Consumption (Volume) Off Trade by Origin
UK Market – Consumption (Volume) Off Trade by Origin Off - Trade Wines by Country 1,000cs 25,000 Negative - decrease in overall consumption: -2% Chile decreasing volumes by 20,000 1% 15,000 10,000 5,000 - NEW Light AUSTR SOUTH GERMA ARGEN PORTU HUNGA BULGA ITALY USA FRANCE CHILE SPAIN ZEALAN Wines A
Slide 17: UK Market – Consumption (Value) Off Trade by Origin
UK Market – Consumption (Value) Off Trade by Origin Off - Trade Wines by Country £m 1,200 Positive - overall value of consumption growing 3% 1,000 Chile in line with the overall trend growing 3% in terms of value. 800 600 400 200 - NEW Light AUSTRA SOUTH GERMA ARGENT PORTU HUNGA BULGA ITALY USA FRAN
Slide 18: UK Market – Market Share by Origin Off Trade
UK Market – Market Share by Origin Off Trade Off - Trade Wine by Country % vol - 5.0 10.0 15.0 20.0 25.0 20.6 AUSTRALIA 21.2 13.6 ITALY 14.7 - Australia recovering mkt share after a weak 14.7 USA 14.4 1st half 2010 12.4 - USA loses mkt share FRANCE 12.2 12.5 - Chile growing mkt share marginally SOUT
Slide 19: UK Market – Average Price per Origin Off Trade
UK Market – Average Price per Origin Off Trade Off - Trade Wine by Country £ per 75cl equiv. - 1.00 2.00 3.00 4.00 5.00 6.00 7.00 4.29 Light Wines 4.47 4.47 Positive - Average price AUSTRALIA 4.60 increasing 4.2% 4.04 ITALY 4.18 Chile: Increase in Average price 4.29 USA 4.43 slightly below overall t
Slide 20: US Market – consumption
US Market – consumption Despite the economic dowturn, in the US, the wine market has continued increasing in volume. Around 1.2% growth in Volume in 2010. Imported volumes of bottled wine increases by 8.0%, & Bulk decreases a 20.1%. (million 9 liter cases) % Change 2008 2009 2010 2010/2009 Win
Slide 21: Moderate increase in Chilean bottled table wine imports
Moderate increase in Chilean bottled table wine imports (Imported table wines shipments – Volume 12 months ended December) +9% 25.000 -Up to December 2010, bottled wine imports up by 8.0% -Imported Table Wine growing 20.000 7.2% -Bulk wine imports decreasing Thousand 9 ltr Cases -2% 20.1% 15.000 10.
Slide 22: Business Model: Key Factors
Concha y Toro Business Model: Key Factors Exclusive focus on Strong Strong wine Distribution Portfolio of Network: Wines across Global Reach / all market Leading segments Position in Key Markets Quality Assurance and Market Consistency: Investment Diversification Own that supports Vineyards and grow
Slide 23: Concha y Toro portfolio
Concha y Toro portfolio % sales by volume 78.8% 19.7% 1.4% % sales by value 62.1% 32.1% 5.9% 23 23/ 23
Slide 24: Cono Sur portfolio
Cono Sur portfolio £12.99 £30 | | Sug. retail £999 price 24
Slide 25: Domestic market Chile – Volumes & Value
Domestic market Chile – Volumes & Value Thousand Liters Million Ch$ Average Annual Growth: 2.7% Average Annual 77,291 74,235 Growth: 4.0% 71,742 70,435 63,261 2006 2007 2008 2009 2010 25 25/ 25
Slide 26: Domestic market Chile – Premium Wine growth
Domestic market Chile – Premium Wine growth Thousand Liters Average Annual Growth: 10.6% 2,632 2,338 2,062 % Premium/Total % Premium/Total 1,890 Year Volume Value 1,584 2006 3,1% 13,0% 2007 2,7% 13,2% 2008 3,1% 15,2% 2009 3,5% 16,3% 2010 4,1% 17,5% 2006 2007 2008 2009 2010 26 26/ 26
Slide 27: Domestic Market Share
Domestic Market Share (by volume) 2005 2006 2007 2008 2009 2010 Concha y Toro 27.1 28.6 30.0 29.7 31.5 30.7 Santa Rita 24.4 25.5 27.9 28.7 28.9 29.4 San Pedro - Tarapacá 21.7 21.9 21.8 23.0 22.5 24.4 Santa Carolina 3.2 3.1 2.3 2.0 1.8 1.8 Others 23.6 20.9 18.0 16.6 15.3 13.8 Source: Nielsen 27 27/ 2
Slide 28: Trivento Export Sales – Argentina
Trivento Export Sales – Argentina Volume & Value Thousand Liters Thousand US$ Average Annual Average Annual Growth: 5.0% Growth: 11.9% 32,976 13,307 13,700 12,254 12,244 28,425 28,432 11,271 24,296 20,996 2006 2007 2008 2009 2010 2006 2007 2008 2009 2010 28 28/ 28
Slide 29: Trivento Export Sales - Argentina
Trivento Export Sales - Argentina (Average Price US$/Case) Average Annual Growth: 6.6% 21,66 20,90 19,23 17,84 16,77 2006 2007 2008 2009 2010 29 29/ 29
Slide 30: Trivento Domestic Sales – Argentina
Trivento Domestic Sales – Argentina Volume & Value Thousand Liters Thousand AR$ Average Annual Growth: 4.9% Average Annual Growth: 18.9% 8,492 66,898 8,313 7,780 7,768 60,008 51,798 6,409 42,316 33,426 2006 2007 2008 2009 2010 2006 2007 2008 2009 2010 30 30/ 30
Slide 31: Trivento – portfolio
Trivento – portfolio Sug. Retail price USA USD 10 USD 15 USD 20 USD 79 Bi-varietal Tribu Reserve Amado Sur Golden Reserve Eolo Category Bi-varietal Varietal Premium Super Ultra Icon Premium Premium Price per case FOB USD18.5 USD 24 USD 34 USD 50 USD 75 USD 300 31 31/ 31
Slide 32: Total Argentine exports by category
Total Argentine exports by category (January – December) Jan - Dec 2010 % Change 2010/2009 Liters US$ Av. Price Liters US$ Av. Price ('000) ('000) US$/Ltr Bottled 230,659 $ 699,088 $ 3.03 3.9% 17.0% 12.6% Bulk 44,580 $ 37,335 $ 0.84 -35.5% 2.9% 59.4% Total 275,239 $ 736,423 $ 2.68 -5.4 16.2% 22.9% S
Slide 33: Income Statement
Income Statement (million Ch$) 4Q2010 4Q2009 Change 2010 2009 Change Operating Results Sales revenues 99,794 94,363 5.8% 374,019 354,419 5.5% Gross Profit 34,181 33,289 2.7% 132,243 130,975 1.0% % of sales 34.3% 35.3% 35.4% 37.0% Selling & Adm. Expenses (22,973) (22,716) 1.1% (86,220) (84,376) 2.2%
Slide 34: Exchange Rate Sensitivity
Exchange Rate Sensitivity As a % of Total Sales: As a % of Exports: Currency Mix Currency Mix Dic-09 Dic-10 Dic-09 Dic-10 CLP 21.4% 23.2% USD 41.5% 40.5% USD 31.6% 30.2% GBP 27.5% 26.3% GBP 20.9% 19.6% EUR 16.3% 14.3% EUR 12.4% 10.7% CAD 4.6% 5.3% CAD 3.5% 3.9% SEK 3.9% 4.1% ARG 2.5% 2.3% NOK 1.1% 1
Slide 35: Exchange Rate main producers
Exchange Rate main producers From 01/01/2010 to 31/12/2010: 1 Year Against US$: Against GBP: Against EUR: 10,0% 10,0% 10,0% 7,7% 4,0% 8,0% 6,0% 5,0% 1,6% 5,0% 4,7% 4,0% 0,0% 0,0% 2,0% Argentina Chile Australia Euro Zone New Zealand South Africa Argentina Chile Australia New Zealand South Africa 0,0%
Slide 36: Financial Debt
Financial Debt Financial Debt* as of: Dic-09 Dic-10 Ch$ MM Av. Interest rate Ch$ MM Av. Interest rate USD 33,687 2.14% 28,573 1.68% EUR 0,727 2.22% GBP 2,891 2.37% 1,262 2.37% CLP 13,728 2.36% UF 40,745 3.90% 39,125 3.90% ARS 4,217 13.97% 5,559 12.90% BRL 1,407 13.30% Total 95,995 3.45% 75,925 3.87%
Slide 37: Business Model: Key Factors
Concha y Toro Business Model: Key Factors Exclusive focus on Strong Strong wine Distribution Portfolio of Network: Wines across Global Reach / all market Leading segments Position in Key Markets Quality Assurance and Market Consistency: Investment Diversification Own that supports Vineyards and grow
Slide 38: Sustained Investment over time
Sustained Investment over time • US$ 347 million between 2005 – 2010 - Vineyard expansion Chile & Argentina - Increasing cellar and vinification capacity - Improvements in bottling capacity and efficiency - Supply Chain 38 38/ 38
Slide 39: Capacity Increase – Support Growth
Capacity Increase – Support Growth • Planted area growth of 114% in the last 7 years (CAGR = 11.5%) • 93% increase in Wine Storage & Ageing Capacity in the last 7 years (CAGR = 9.8%) 39 39/ 39
Slide 40: Concha y Toro vineyard holdings
Concha y Toro vineyard holdings (hectares) Vineyards Hectares to Total Planted 2010 be planted Hectares Valley - Chile Limarí 896 322 1,218 Casablanca 415 11 426 San Antonio 130 - 130 Aconcagua - 129 129 Maipo 974 22 997 Cachapoal - Rapel 1,306 525 1,831 Colchagua - Rapel 1,757 13 1,770 Curicó 666 4
Slide 41: The Chilean Wine Industry – An overview
The Chilean Wine Industry – An overview Total Hectares 2009: 123,000 +1.7% Growth Rate 2009/2008 Total bottled wine exports 2010 458,498 thousand liters Concha y Toro: 36.6% Mkt Share Volume Exported bottled wine 2010 30.7% Mkt Share Vol Domestic Market (Dec 2010) 8,445 Hectares Planted (2010) 355.5
Slide 42: Area planted – largest wineries
Area planted – largest wineries (hectares planted) 0 2.000 4.000 6.000 8.000 10.000 12.000 14.000 Foster's Group (AUS/USA/NZ/IT) 12.463 Concha y Toro (CHI/ARG) 9.513 Constellation (USA/AUS/NZ/CAD) 8.990 E&J Gallo (USA) 8.100 Pernod Ricard (FR/AUS/ARG) 8.000 Grupo Peñaflor (ARG) 5.215 Source: Compani
Slide 43: Shareholder structure (Dec. 2010)
Shareholder structure (Dec. 2010) Other ADR's 7,3% 2,2% Other Large Shareholders 16,7% Control Group 41,7% Brokerage H, Mutual F & Insurance 16,4% Chilean AFP's 15,7% 43 43/ 43
Slide 44: Company Stock – Market Value
Market Value (million US$) - 1.200 1.400 1.600 1.000 1.800 2.000 200 400 600 800 Ene-03 Abr-03 Jul-03 Oct-03 Ene-04 Abr-04 Jul-04 Oct-04 Ene-05 Abr-05 Jul-05 Oct-05 Ene-06 Abr-06 Jul-06 Oct-06 Ene-07 Abr-07 Jul-07 Oct-07 Ene-08 Abr-08 in US$ Terms CAGR: 17.6% Jul-08 Oct-08 Ene-09 Abr-09 Jul-09 Oct-0
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