Coca-cola Hbc Ag · LSE:CCH
Coca-cola Hbc — FY2021 Earnings Presentation
32 slides from Coca-cola Hbc's earnings presentation, Feb 22, 2022
Slide 1: Execution Drives Momentum: Full Year Results
EXECUTION DRIVES MOMENTUM FULL YEAR RESULTS 22 FEBRUARY 2022
Slide 2: Forward-Looking Statement
FORWARD-LOOKING STATEMENT Unless otherwise indicated, the condensed consolidated interim financial statements and the financial and operating data or other information included herein relate to Coca-Cola HBC AG and its subsidiaries (“Coca-Cola HBC” or the “Company” or “we” or the “Group”). This docu
Slide 3: Operational Review & Strategy
OPERATIONAL REVIEW & STRATEGY ZORAN BOGDANOVIC CHIEF EXECUTIVE OFFICER 3 FULL YEAR RESULTS 22 FEBRUARY 2022
Slide 4: Strong Execution Drives Growth Momentum
STRONG EXECUTION DRIVES GROWTH MOMENTUM 1 Delivered strong financial performance 2 Growth driven by strategic priorities 3 Increasing prices and gaining share 4 Investing for sustainable, long-term growth 5 Increasing dividend pay-out ratio 6 Strongest ever partnership with The Coca-Cola Company 4 F
Slide 5: Strong Financial Progress
STRONG FINANCIAL PROGRESS Volume* Comparable EBIT Free cash flow €831m €601.3m +14.0% vs 2020 +23.6% +€104.3m +9.0% vs 2019 or + 20.2% ex Cyprus property sale FX-neutral revenue* Comparable EPS Dividend +20.6% vs 2020 €1.58 €0.71 +33.7% +10.9% +10.3% vs 2019 *Like for like 5 FULL YEAR RESULTS 22 FEB
Slide 6: Performance Is Driven by Our Strategy
PERFORMANCE IS DRIVEN BY OUR STRATEGY 1 24/7 2 WIN IN THE 3 COMPETITIVENESS 4 POTENTIAL 5 LICENSE PORTFOLIO MARKET PLACE & INVESTMENT OF OUR PEOPLE TO OPERATE ACCELERATING SHARE GAINS INCREASED FCF AGILE COMMITMENTS GROWTH INCREASE and INVESTMENT ORGANISATION AND PROGRESS • Growth driven by • Price
Slide 7: Egyptian Growth Opportunity
EGYPTIAN GROWTH OPPORTUNITY Acquisition closed in January adding growth potential and EPS accretion • EBIT margin impact of c. -30bps in 2022 • Low-single digit EPS accretion expected in 2022 Significant growth opportunity • Adding >100 million people, average age of 25 • Opportunity to increase per
Slide 8: Strong Recovery; Room for More in Est and Dev
STRONG RECOVERY; ROOM FOR MORE IN EST AND DEV VOLUMES (m unit cases) GROUP OUT-OF-HOME CHANNEL AT HOME CHANNEL +9% vs ’19 +1% vs ’19 +14% vs ’19 +14% vs ’20 2,412.7 +24% vs ’20 +10% vs ’20 2,264.5 2,135.6 2019 2020 2021 2019 2020 2021 2019 2020 2021 ESTABLISHED SEGMENT DEVELOPING SEGMENT EMERGING SE
Slide 9: Revenue Growth Management, Including Pricing Drives Price/Mix +5.8%
REVENUE GROWTH MANAGEMENT, INCLUDING PRICING DRIVES PRICE/MIX +5.8% Pricing • Taken pricing in 95% of our markets in 2021 • Pricing in all quarters, including additional wave in Q4 • Improving ROI on promotions Package Mix • Smart affordability with Sharing Entry Packs • Drive premiumization with Mu
Slide 10: Consistent Sparkling Growth; Broad-Based Strength Across Brands
CONSISTENT SPARKLING GROWTH; BROAD-BASED STRENGTH ACROSS BRANDS ANNUAL VOLUME GROWTH 2021 VOLUME GROWTH 13.8% 18.8% 5-year volume average 14.4% +5% 12.3% 4.3% 3.5% 2.3% 0.2% 2017 2018 2019 2020 2021 Trademark Coke Fanta Sprite 10 FULL YEAR RESULTS 22 FEBRUARY 2022
Slide 11: Low/No Sugar and Adult Sparkling Driving Momentum
LOW/NO SUGAR AND ADULT SPARKLING DRIVING MOMENTUM LOW/NO SUGAR VOLUME GROWTH ADULT SPARKLING VOLUME GROWTH 47.3% 31.8% 5-year volume average +23% 5-year volume average +10% 25.9% 26.7% 13.0% 6.0% 7.1% 2.7% 3.9% 3.2% 2017 2018 2019 2020 2021 2017 2018 2019 2020 2021 11 FULL YEAR RESULTS 22 FEBRUARY 2
Slide 12: Energy Growth Continues
ENERGY GROWTH CONTINUES ENERGY VOLUME GROWTH ENERGY VOLUME GROWTH VS SPARKLING • Pace of successful 50% 50% 29% Energy innovation continues, 5-year volume CAGR 40% 40% SSDs with more planned 30% 30% for 2022 20% 20% 10% • Brand portfolio 10% 0% addresses range of 0% -10% consumer profiles 2016 2017
Slide 13: Coffee Is Another Growth Opportunity
COFFEE IS ANOTHER GROWTH OPPORTUNITY PREMIUM AND MASS PREMIUM / OOH AND AH OFFERING The coffee market is At Home portfolio Away from Home portfolio & Solutions large, and growing Breakfast & Routine at home Socialising and drinking out €9 billion distributor value + MSD category growth At Work & On
Slide 14: Dedicated Digital Strategy to Unlock Value
DEDICATED DIGITAL STRATEGY TO UNLOCK VALUE ROUTE TO CUSTOMER ROUTE TO CONSUMER 01 02 03 04 Enabling our customers Digitising our route to Increasing sales in Trialing direct to to order online from us, market through e-retail consumer platforms 24/7 e-marketplaces Platform allowing One-stop-shop for
Slide 15: Net Zero by 2040
NET ZERO BY 2040 STRONG TRACK BOARD AND RECORD OF EMISSIONS ACROSS THE ENTIRE MANAGEMENT REDUCTION VALUE CHAIN COMMITMENT • 31% reduction since 2010 • Reductions across Scope 1, 2 • Long-term incentives support and 3 our plans • Targets achieved 2 years ahead of plan • Built on sound science and • 1
Slide 16: Progress on Mission 2025
PROGRESS ON MISSION 2025 98% of total electricity #1 ranking in used in our plants in European Beverages EU & Switzerland is and #2 in Global from renewable and Beverages, the 11th clean sources year we have achieved a top 3 global ranking 42% 15% of our coolers in the reduction in calories A List r
Slide 17: Financial Review
FINANCIAL REVIEW BEN ALMANZAR CHIEF FINANCIAL OFFICER 17 FULL YEAR RESULTS 22 FEBRUARY 2022
Slide 18: Strong Financial Performance on All Key Lines
STRONG FINANCIAL PERFORMANCE ON ALL KEY LINES VOLUME GROWTH RECORD IMPROVED PRICE/MIX*(€) RECORD EBIT AND MARGIN ACCELERATION* (€m) REVENUE* (€m) (€m) +14.0% vs ’20 +20.6% vs ’20 +5.8% vs ’20 +23.6% vs ’20 2.94 2.97 831.0 2.81 758.7 Excluding 11.6% property sale 11.3% 672.3 10.8% 11.0% 2019 2020 202
Slide 19: Revenues Accelerate
REVENUES ACCELERATE FX NEUTRAL REVENUE (like for like) • Strong rebound in volumes, up 14.0% like-for-like. % change YoY Volumes are now 9.0% above 2019 levels, on a like-for- 20.6% like basis • Like-for-like price/mix expanded 5.8%, or 3.9% ex Poland 5.8% − Positive contribution from pricing, categ
Slide 20: EBIT Grew by 23.6%; Margin Expansion Continues
EBIT GREW BY 23.6%; MARGIN EXPANSION CONTINUES PRODUCTIVITY EFFICIENCIES • Comparable EBIT expanded 23.6% while POH as % NSR vs POH per UC vs comparable EBIT margins expanded 60bps to 2020 2020 11.6% − 30bps benefit from the sale of a property in -140bps -9.4% Cyprus • Comparable gross profit margin
Slide 21: Marketing Investment Up 63%
MARKETING INVESTMENT UP 63% OPERATING MARKETING • Comparable OPEX increased 7.5% COSTS SPEND − Discretionary opex savings − Operational leverage +7.5% +63% • Significant increase in marketing spend -220bps +100bps • Comparable OPEX as a % of revenue improved by % of revenue % of revenue 220bps YoY O
Slide 22: Established Markets
ESTABLISHED MARKETS STRONG RECOVERY AS OUT-OF-HOME REOPENED ESTABLISHED MARKETS +9.9% +3.7% +13.9% • FX-n revenue is 2.1% below 2019 • Out-of-home reopening VOLUME PRICE / MIX FX-NEUTRAL provided strong support to REVENUE volumes • Italy sales slightly above pre- pandemic levels, while Greece has be
Slide 23: Developing Markets
DEVELOPING MARKETS SHARE GAINS HELP TO MITIGATE SUGAR TAX IMPACT DEVELOPING MARKETS +0.8% +17.0% +18.0% • FX-n revenue is 5.7% above 2019 • Strong low/no sugar VOLUME PRICE / MIX FX-NEUTRAL performance and market share REVENUE gains in Poland drove resilient volumes despite sugar tax • Excluding the
Slide 24: Emerging Markets
EMERGING MARKETS STRENGTH IN RUSSIA AND NIGERIA CONTINUES EMERGING MARKETS +20.4% +5.6% +27.1% • FX-neutral revenue is 23.6% above 2019 VOLUME PRICE / MIX FX-NEUTRAL • Strong volume growth in Nigeria, REVENUE Russia and Ukraine • Price/mix benefited from pricing, positive category and pack mix, part
Slide 25: EPS Expansion of 33.7%
EPS EXPANSION OF 33.7% • Comparable EPS +33.7% supported by higher FY 2021 FY 2020 change profitability Finance cost, net (€m) 67.6 70.1 -3.6% • Comparable tax rate down to 25% Comparable tax (€m) 188.2 174.0 8.2% Comparable tax rate 25% 29% -400bps • Finance costs remain broadly unchanged Comparabl
Slide 26: Free Cash Generation with Continued Investment
FREE CASH GENERATION WITH CONTINUED INVESTMENT FY 2021 FY 2020 change • Capex reached 7.5% of revenue, the top end of our Comparable EBITDA (€m) 1,183.0 1,070.8 10.5% guidance range of 6.5-7.5% Working capital change (€m) 196.8 108.3 81.7% • We took advantage of our strong balance sheet Net capital
Slide 27: Continued ROIC Expansion
CONTINUED ROIC EXPANSION ROIC expansion ROIC at 14.8%, above 2019 levels, driven by: 14.2% 14.8% 13.7% 14.4% 12.7% excl. • Increased profitability vs 2020 Cyprus 11.1% asset sale • Lower net working capital • Cyprus property sale added 40bps 2017 2018 2019 2020 2021 27 FULL YEAR RESULTS 22 FEBRUARY
Slide 28: Strong Balance Sheet Maintained
STRONG BALANCE SHEET MAINTAINED • Net debt to EBITDA at balance sheet date was 1.1x − 1.6x in January, including the acquisition of Coca-Cola Bottling Company of Egypt, within our targeted range of 1.5-2.0x • Next bond maturity November 2024 • Proposed dividend of €0.71 28 FULL YEAR RESULTS 22 FEBRU
Slide 29: Shift to Organic Metrics
SHIFT TO ORGANIC METRICS We plan on introducing organic reporting as of Q1 22 • Shift from FX-neutral and LFL measures to organic measures • More consistency and comparability with peers on volume, sales and EBIT No change to our 2022 guidance • Organic sales growth replaces FX-neutral like for like
Slide 30: 2022 Outlook
2022 OUTLOOK Expect FX-n like-for-like revenue growth above the 5-6% range in 2022 • Volume progress in all segments led by Emerging • Another year of price/mix expansion Expect like-for-like comparable EBIT growth of low to mid single digits in 2022 • Upper end of HSD COGS/case inflation for the ye
Slide 31: Sustainable, Long-Term Growth
SUSTAINABLE, LONGTERM GROWTH • Leader in an attractive, growing industry • Broad portfolio to serve consumers, 24/7, combined with the capabilities to win in the market with our customers • Highly engaged team with a winning mindset • Diverse markets with exposure to high growth geographies • Relent
Slide 32: Q & A
Q&A For further information on Coca-Cola Hellenic please visit our website at: www.coca-colahellenic.com Or contact our investor relations team: Joanna Kennedy Head of Investor Relations joanna.kennedy@cchellenic.com +44 (0)7802 427505 Jemima Benstead Investor Relations Manager jemima.benstead@cchel