Treasury Wine Estates Limited · ASX:TWE
Treasury Wine Estates — FY2024 Earnings Presentation
32 slides from Treasury Wine Estates's earnings presentation, Aug 15, 2024
Slide 1: 2024 Annual Results Investor and Analyst Presentation
15 August 2024 ASX ANNOUNCEMENT 2024 Annual Results Investor and Analyst Presentation Enclosed are the presentation materials for the investor and analyst webcast and conference call to be hosted by Treasury Wine Estates commencing at 10:00am (AEST) on 15 August 2024. Links to register for the confe
Slide 2: F24 Full Year Results
F24 Full Year Results 15 AUGUST 2024
Slide 3: Important information
Important information This presentation is in summary form and is not necessarily complete. It should be read together with the Company’s Annual Report for 30 June 2024 and other announcements lodged with the Australian Securities Exchange, which are available at www.asx.com.au. This presentation co
Slide 4: Introduction
Introduction Tim Ford Chief Executive Officer
Slide 5: Key Messages
Key Messages1 • F24 EBITS $658.1m, up 12.8%, driven by strong Luxury portfolio growth in Penfolds and Treasury Americas, partly offset by lower Premium and Commercial portfolio shipments in Treasury Premium Brands: – Excluding the 2H24 contribution from DAOU, EBITS increased 6.4%, in line with the g
Slide 6: F24 Financial Highlights
F24 Financial Highlights1,2,3 Strong Luxury portfolio momentum drives Group NSR and EBITS growth NSR EBITS NPAT $2.7bn 13.1% $658.1m 12.8% $407.5m 8.3% NSR per case EBITS margin EPS4 $125.2 14.2% 24.0% 0.1 ppts 52.3cps 1.4% Cash conversion ROCE6 82.0% 21.4 ppts 10.9% 0.4 ppts Luxury contribution to
Slide 7: F24 Divisional performance
F24 Divisional performance Top-line growth driven by Penfolds and Treasury Americas Luxury % Metric1, 2 F24 % pcp % CFX F24 % pcp % CFX F24 % pcp % CFX Organic3 NSR (A$m) 1,000.5 22.1% 21.2% 1,002.3 22.1% 19.4% 0.6% 737.0 (5.8)% (8.9)% NSR per case (A$) 331.7 (6.4)% (7.0)% 167.0 11.3% 8.9% 1.1% 57.3
Slide 8: Sustainability
Sustainability Making good progress in responding to material opportunities Material topic Target F24 Progress2 Climate Change ● 100% renewable electricity by 2024 ● Renewable electricity usage ~80%, with 24 solar installations to date and Energy1 ● Net zero by 2030 (scope 1 and 2) (generating ~6,50
Slide 9: Our evolution continues
Our evolution continues We’ve made significant progress since 2020, with Luxury-led growth now our clear strategic focus To be the world’s most admired To be the world’s most desirable luxury wine company premium wine company Key achievements since 2020 Luxury-led Established the brand portfolio-led
Slide 10: TWE Game Plan
TWE Game Plan Our journey enters its next phase with the launch of our new Game Plan 9
Slide 11: Global Operating Model
Global Operating Model Strengthening the separate focus between our Luxury and Premium portfolios Luxury Premium Global Premium Brands % Group NSR 58% B I N & I C O N % Group NSR 42% % Group EBITS 79% % Group EBITS 21% Volume NSR NSR/9Le Volume NSR NSR/9Le Volume NSR NSR/9Le 3.0m 9le $1,001m $332 1.
Slide 12: Financial Performance
Financial Performance Stuart Boxer Chief Financial and Strategy Officer
Slide 13: Key measures of performance
Key measures of performance1 Group NSR (A$m) and NSR per case Group EBITS (A$m) and EBITS margin 24.1% 24.0% 125.2 19.9% 21.1% 19.3% 109.7 97.3 81.9 83.8 658 583 513 510 524 2,650 2,740 2,570 2,477 2,423 71% 77% 87% 83% 85% 29% 23% 17% 15% 13% F20 F21 F22 F23 F24 F20 F21 F22 F23 F24 Commercial Luxur
Slide 14: Material items
Material items Projected non- Recognised prior Recognised in Total projected Projected cash Material Items (A$m) cash Status to F24 F24 one-off cost component component Treasury Premium Brands impairment (announced 6 August 2024) (353.7) Brands write-down (228.8) - (353.7) - (353.7) Complete Goodwil
Slide 15: Balance sheet
Balance sheet1,2 F24 F23 A$m 30-Jun-24 30-Jun-23 Cash & cash equivalents 458.1 565.8 • Net assets increased $732.0m on a reported currency basis Receivables 694.9 612.9 in F24; adjusting for the movement in foreign exchange Current inventories 1,020.5 990.3 rates, net assets increased $754.4m Non-cu
Slide 16: Inventory analysis
Inventory analysis Inventory at book value split by price segment1,2 $1,020.5m $990.3m $1,339.1m $1,175.3m $2,359.6m $2,165.5m • Total inventory volume decreased 3% versus the pcp 45% Total Luxury • Total inventory value increased 9%: $1,584m 57% 57% (F23: $1,230m) – Current inventory increased $30.
Slide 17: Cash flow and net debt
Cash flow and net debt1 A$m (unless otherwise stated) F24 F23 EBITDAS 813.3 730.8 • Cash conversion was 82.0% in F24: Change in working capital Other items (138.5) (8.3) (274.9) (12.8) – Excluding the change in non-current Luxury and Net operating cash flows before financing costs, tax & material it
Slide 18: Capital expenditure
Capital expenditure A$m F24 F23 Wine making equipment and facilities 34.3 31.0 • Capital expenditure (capex) of $190.1m in F24: 22.4 – Maintenance & replacement capex of $100.7m, Vineyard redevelopments 19.6 including focus on ongoing upgrades to wine making Sustainability 14.0 21.1 equipment and fa
Slide 19: Capital management
Capital management • Efficient and flexible investment grade capital structure: - Net debt / EBITDAS1 2.0x at F24, inclusive of twelve months A$m Debt maturity profile EBITDAS contribution for DAOU, with further deleveraging 600 USPP Notes expected in F25 Acquistion Bridge Facility Asian Term Loan •
Slide 20: Divisional Performance
Divisional Performance Tom King Managing Director, Penfolds Ben Dollard President, Treasury Americas Angus Lilley Managing Director, Treasury Premium Brands
Slide 21: Penfolds
Penfolds Top-line growth delivered across all Luxury portfolio tiers, led by continued strength in Asia Reported Currency Constant Currency Performance summary1 F24 F23 % F23 % • EBITS increased 16.1% and EBITS margin declined 1.9ppts to 42.1%: Volume (m 9Le) 3.0 2.3 30.4% 2.3 30.4% – Strong top-lin
Slide 22: Treasury Americas
Treasury Americas Strong top-line growth from the leading US Luxury wine portfolio Reported Currency Constant Currency Performance summary1 F24 F23 % F23 % % Organic2 • EBITS increased 8.4% and EBITS margin declined 2.3ppts to 23.0%: Volume (m 9Le) 6.0 5.5 9.7% 5.5 9.7% (0.5)% – Strong Luxury portfo
Slide 23: Treasury Premium Brands
Treasury Premium Brands Commercial and Premium portfolio declines drive lower EBITS delivery Reported Currency Constant Currency Performance summary1 A$m F24 F23 % F23 % • EBITS declined 16.7% and EBITS margin declined 1.0ppt to 10.3%: Volume (m 9Le) 12.9 14.3 (10.1)% 14.3 (10.1)% – Double-digit dec
Slide 24: Outlook
Outlook Tim Ford Chief Executive Officer
Slide 25: Summary and outlook
Summary and outlook • In F24, strong Luxury portfolio momentum in Penfolds and Treasury Americas drove NSR and EBITS growth, partly offset by the impact of reduced Premium and Commercial shipments in Treasury Premium Brands • TWE expects to deliver EBITS in the range of $780-810m in F25, with top-li
Slide 26: Questions
Questions
Slide 27: Supplementary Information
a 4 Supplementary Information
Slide 28: DAOU F24 performance
DAOU F24 performance Metric 2H24 F24 Volume (m 9le) 0.6 1.2 NSR (A$m) 158.0 332.5 EBITS (A$m) 37.4 95.3 TWE’s F24 result also included DAOU’s contribution between 12 December 2024 and 31 December 2024, which was immaterial. Note that F24 metrics include those from 1H24, prior to acquisition by TWE,
Slide 29: Impact of foreign exchange and hedging
Impact of foreign exchange and hedging F24 EBITS constant currency impact F25 EBITS sensitivity and risk management CFX Impact (A$m) EBITS Primary Currency Pair Movement Sensitivity Currency Underlying Hedging1 Total Exposure (A$m) AUD/USD and AUD/GBP 19.8 (2.6) 17.2 AUD/USD COGS, EBITS + 1% (4.2) N
Slide 30: Reconciliation of key performance measures
Reconciliation of key performance measures Metric (A$m unless Management calculation F24 F23 otherwise stated) Statutory net profit 98.9 254.3 Income tax expense 69.3 82.8 Net finance costs 96.6 72.7 EBITS Material items (gain) / loss 404.2 109.2 SGARA (gain) / loss (10.9) 64.5 EBITS 658.1 583.5 EBI
Slide 31: 2024 Fact Book
2024 Fact Book For further information on Treasury Wine Estates, please refer to our 2024 Fact Book, which is available at tweglobal.com 30
Slide 32: Definitions
Definitions 9Le 9 litre equivalent case Cash conversion* Net operating cash flows before financing costs, tax and material items divided by EBITDAS CFX Constant foreign exchange rates COO Country of origin CODB* Cost of doing business. Gross profit less EBITS. Excludes non-cash items as well as tax,