Slide 1: Presentation FY2002 Results
PRESENTATION FY2002 RESULTS
Slide 2: Introduction
Introduction • Campari delivered solid and above-forecast results in a challenging economic environment - supported by... Introduction Highlights ü strong external growth (Skyy Spirits and Brands Sella&Mosca/Zedda Piras acquisitions) Activities Financials ü positive development of existing business
Slide 3: Delivering solid results in 2002
Delivering solid results in 2002 FY2002 change € million % Net sales 661 34% Introduction EBITDA 160 40% Highlights EBITA 142 42% Brands EBIT 115 29% Activities Financials Net income 87 37% Outlook € % change EPS 2.98 37% (1) EPS adj. 3.21 29% € % yield (2) DPS 0.88 3.0% (1) EPS adjusted for GW amor
Slide 4: 3rd consecutive year of strong growth
3rd consecutive year of strong growth Net turnover EBITDA CAGR 1999/2002 CAGR 1999/2002 700 +22% 661 +23% 200 600 494 160 500 434 150 € million 366 114 € million 400 105 Introduction 300 100 86 Highlights 200 50 Brands 100 - - Activities 1999 2000 2001 2002 1999 2000 2001 2002 Financials Outlook EBI
Slide 5: Rising in rank
Rising in rank Top 100 Premium Distilled Spirit Brands Worldwide by Company Rank Rank Number of 2002E Percent Change 2003 2002 Company Top 100 Brands 9-ltr cases m. 2001-2002E Introduction 1 1 Diageo 17 67.9 1.8% Highlights 2 4 Pernod Ricard 13 28.2 0.0 3 2 Allied Domecq 12 27.4 -0.4 Brands 4 3 Baca
Slide 6: Highlights
Highlights Marco Perelli-Cippo, CEO
Slide 7: Net sales - Organic and external growth
Net sales - Organic and external growth Target +30% €31.4m €0.4m €25.1 m €660.6 m Introduction €128.4m +6.3% +0.1% +5.1% +33.7% Highlights +26.0% Brands €(19.0) m Activities €494.3m -3.8% Financials Outlook Net organic growth External growth €6.1 m €160.2m +1.3% +32.4% FY2001 Skyy Spirits ZP/SM (2)
Slide 8: Return on acquisitions in 2002
Return on acquisitions in 2002 2002 USD m Skyy Spirits > EBITDA 37.8 Introduction Minorities (14.7) Total 23.0 Highlights Enterprise value 248.2 Brands Activities Multiple 10.8x Financials Return on acquisition 9.3% Outlook (*) Excl. tax saving on goodwill amortisation ($5m p.a. for 20 years) 2002 €
Slide 9: Sales breakdown by region
Sales breakdown by region • International markets exceed 50% of net sales in 2002 Introduction 2002 sales by region 660.6m Highlights Brands RoW Activities 3.3% 2001 sales by region Americas Financials 30.3% Italy 494.3m Outlook 47.1% incl. US 20.9% RoW Brazil 8.4% Americas 4.6% Europe 15.5% 19.3% I
Slide 10: Sales breakdown by segment
Sales breakdown by segment • Increased focus on spirits & wines accounting for c.80% of net sales Introduction Highlights 2002 sales by segment 660.6m Brands Activities Soft 2001 sales by segment Drinks Other Financials 1.5% 494.3m 19.3% Outlook Soft Other Drinks 1.9% Wines 14.6% Spirits 25.8% 64.6%
Slide 11: Trading profit by segment
Trading profit by segment • Spirits & wines account for 86% of trading profit(1) Introduction Highlights 2002 trading profit by segment 180.8m Brands Soft Activities Drinks Other Financials 2001 trading profit by segment 1.0% Wines 12.7% 136.5m Outlook 6.6% Soft Drinks Other 16.1% 1.3% Wines Spirits
Slide 12: Brand Performance
Brand Performance Enzo Visone, Deputy CEO
Slide 13: Performance of key brands
Performance of key brands % change in value 2002/2001 Analysis of net sales by product (at constant exchange rates) (by value after currency effects) Spirits Introduction (1) Campari Highlights Campari +2.6% Other 18% CampariSoda 3.3% 25% Brands Brazilian brands (1) +16.0% Activities Ouzo 12 4.5% Ou
Slide 14: Campari
Campari • +2.6% growth at constant exchange rates (-1.5% after currency effects) • Top 3 markets (Italy, Germany, Brazil) account for Introduction Highlights more that 50% sales Brands – strong growth in Italy Activities – positive performance by volume (+2.7%) and value in Brazil Financials Outlook
Slide 15: SKYY Vodka
SKYY Vodka • US market (95% of product sales) – awarded «IMPACT Hot brand» for 8th consecutive year – 1.5 million cases in 2002 (+16.2% on 2001) (1) Introduction – introduction of new super-premium packaging and three new Highlights Brands flavours in March 2003 Activities – Increased awareness as a
Slide 16: Tequila 1800
Tequila 1800 • One of the leading brands in the Introduction super-premium category in the Highlights US market ($20-$40 RSP) Brands Activities • One of the fastest growing Financials categories in the last 3-5 years Outlook • Despite the recent agave shortage, tequila continues to be an attractive
Slide 17: Cinzano
Cinzano Cinzano sparkling wines • Cinzano sparkling wines (+16.2% at (64% of Cinzano total sales) net sales by region constant exchange rates) Americas RoW 2% – strong performance in Italy 9% Introduction Highlights – distribution initiated in Brazil Brands – weakness signs persist in Germany Italy
Slide 18: Single-serving aperitives
Single-serving aperitives • Crodino (soft drinks, +4.3%) and CampariSoda (spirits, Introduction +3.3%) are #1 and #2 ranked single-serving aperitif Highlights brands in Italy with a combined market share of 53.5% Brands Activities in 2002 (52.1% in 2001)(1) Financials • Strong brand positioning bene
Slide 19: The RTD's range
The RTD’s range • Campari Mixx Introduction – target of 10 million bottles in Italy Highlights achieved in 2002 Brands – introduction in Austria and Germany in Activities Financials April 2003. Marketing and distribution Outlook to be operated with leading local distributors • SKYY Blue – #2 ranked
Slide 20: Review of Activities
Review of Activities Paolo Marchesini, CFO
Slide 21: Spirits
Spirits 2002 spirits sales by region Trading profit analysis 426.6m 144.2 RoW 2% +42.2% Italy 101.4 34% Americas Introduction 45% Highlights Brands €m Incl. USA 32% Activities Europe 19% Financials 2001 2002 Spirits sales 2002 Outlook % spirits sales 2001 2002 Total growth +50.3% External growth +49
Slide 22: Wines
Wines 2002 wines sales by region 96.6m Trading profit analysis RoW 11.9 Americas 13% +4.1% Italy 8% 34% Introduction 11.4 Highlights Brands €m Europe Activities 45% Financials 2001 2002 Wines sales 2002 Outlook Total growth +31.3% % wines sales 2001 2002 External growth +27.9% Gross margin 41.9% 46.
Slide 23: Soft drinks
Soft drinks 2002 soft drinks sales by region Trading profit analysis 127.2m 22.9 Europe 2% +4.5% Introduction Highlights Brands 21.9 Activities Financials €m Italy Outlook 98% 2001 2002 Soft drinks sales 2002 % soft drinks sales 2001 2002 Total growth -0.1% Gross margin 45.7% 45.3% Organic growth -0
Slide 24: Consolidated Results
Consolidated Results Paolo Marchesini, CFO
Slide 25: Consolidated trading profit
Consolidated trading profit 2001 2002 Change Introduction €m % €m % % Highlights Net turnover 494.3 100.0% 660.6 100.0% 33.7% Brands COGS (211.5) -42.8% (276.3) -41.8% 30.6% Activities Gross profit 282.8 57.2% 384.3 58.2% 35.9% Financials Advertising and promotion (91.3) -18.5% (130.8) -19.8% 43.3%
Slide 26: Consolidated EBIT
Consolidated EBIT 2001 2002 Change €m % €m % % Introduction Trading profit 136.5 27.6% 180.8 27.4% 32.5% Highlights General and administrative expenses (31.6) -6.4% (43.3) -6.6% 37.4% Brands Other operating revenues 0.7 0.1% 5.8 0.9% 699.3% Activities Goodwill and trademark amortisation (11.4) -2.3%
Slide 27: Consolidated pretax profit
Consolidated pretax profit 2001 2002 Change €m % €m % % EBIT 88.7 17.9% 114.7 17.4% 29.3% Introduction Net financial income (expenses) 3.2 0.6% (6.1) -0.9% -292.7% Highlights Income (losses) on net rates (3.9) -0.8% 8.2 1.2% -310.8% Brands Other non oper. Income 6.1 1.2% 6.6 1.0% 31.2% Activities Pr
Slide 28: Consolidated net profit
Consolidated net profit 2001 2002 Change Introduction €m % €m % % Highlights Pretax profit after minorities 94.0 19.0% 107.6 16.3% 14.5% Brands Taxes (30.6) -6.2% (20.9) -3.2% -31.6% Activities Net income 63.4 12.8% 86.7 13.1% 36.7% Financials Outlook Tax rate 32.6% 19.4% • Decrease in tax rate: 19.
Slide 29: Calculation of EPS and adj. EPS
Calculation of EPS and adj. EPS 2001 2002 change Stated Net profit €m 63.4 86.7 36.7% Adjustment A1 Introduction Goodwill amortisation €m 11.4 27.8 Highlights Restated net profit for goodwill €m 74.9 114.4 52.9% Brands Adjustment A2 Activities Tax saving on deductible goodwill €m (1.2) (6.1) Financi
Slide 30: Operating working capital
Operating working capital €44.7m Analysis of change in NWC Introduction €86.0m €(23.4)m €3.2m €93.5m Highlights Change in NWC €(17.0)m Brands + € 7.5 m Activities Financials Outlook 31-Dec-2001 Acquisitions Forex Novi Ligure Organic NWC 31-Dec-2002 payables Breakdown of operating working capital 227
Slide 31: Cash flow
Cash flow (€ m) 2001 2002 Net profit 63.4 86.7 Depreciation and amortisation 25.8 45.3 Provisions (1) 0.0 10.0 Total net profit, D&A and provisions 89.2 142.0 Adjustments and other provisions 8.2 (22.7) Introduction Change in Operating NWC (organic) (2) (9.1) (3.2) Highlights Operating cash flow 88.
Slide 32: Net financial debt gearing
Net financial debt 31 Dec 2001 31 Dec 2002 €m €m Cash 177.8 103.5 Introduction Marketable securities 46.4 4.2 Highlights Short term bank debt (112.3) (120.2) Brands Capital lease and other financial (15.3) (23.2) Activities Private placement 0.0 (163.1) Financials Net cash/(debt) 96.6 (198.8) Outloo
Slide 33: Outlook and Conclusion
Outlook and Conclusion Marco Perelli-Cippo, CEO
Slide 34: Outlook on 2003
Outlook on 2003 • Strengths... – Campari’s positioning has strengthened as a result of the latest acquisitions: Introduction • increased focus on spirits&wines Highlights Brands • growth outside Italy, in particular the US market Activities – Campari has entered fast growing categories with positive
Slide 35: Appendices
Appendices Financial tables
Slide 36: Consolidated Income Statement
CONSOLIDATED INCOME STATEMENT 2001 2002 Change € mn. % € mn. % % Net sales 494.3 100.0% 660.6 100.0% 33.7% Total cost of goods (211.5) -42.8% (276.3) -41.8% 30.6% Gross margin 282.8 57.2% 384.3 58.2% 35.9% Advertising and promotion (91.3) -18.5% (130.8) -19.8% 43.3% Sales and distribution expenses (
Slide 37: Consolidated Balance Sheet
CONSOLIDATED BALANCE SHEET 31-12-2001 31-12-2002 Change €m €m €m Cash and banks 177.8 103.5 (74.3) Marketable securities 46.4 4.2 (42.2) Accounts receivable, net of write-down reserves 108.3 132.9 24.6 Inventories 64.4 94.9 30.5 Other current assets 29.7 49.0 19.3 Total current assets 426.6 384.5 (4
Slide 38: Reclassified Consolidated Balance Sheet
RICLASSIFIED CONSOLIDATED BALANCE SHEET 31-12-2001 31-12-2002 Change €m €m €m Inventories 64.4 94.9 30.5 Receivables from customers 108.3 132.9 24.6 Payables due to suppliers (86.7) (134.3) (47.6) Operating working capital 86.0 93.5 7.5 Other current assets and liabilities (20.8) (11.4) 9.4 P&L Net
Slide 39: Campari stock performance
Campari stock performance Campari relative performance +40% 40 10.0 9.0 P&L 35 Balance sheet 8.0 Share price 30 Shareholders 7.0 Equity turnover (€ million) 6.0 25 Price ( € ) 5.0 20 4.0 15 3.0 2.0 10 1.0 5 - gen-02 feb-02 mar-02 mag-02 giu-02 ago-02 set-02 ott-02 dic-02 gen-03 mar-03 Campari equity
Slide 40: Shareholder structure
Shareholder structure Free float 45.6% P&L Balance sheet Market Share price 37.0% Shareholders Garavoglia family 51.0% Morgan Stanley Inv. Mgmt. Treasury (1) 8.6% 3.4% (1) Purchase of own shares aimed at servicing the stock option plan Except for those mentioned above, there are no other shareholder
Slide 41: For additional information: Investor Relations
For additional information: Investor Relations - Campari Group Phone: +39 02 6225 330; Fax: +39 02 6225 479 E-mail: investor.relations@campari.com; Website: www.campari.com