Slide 1: United Spirits Limited Investor Meet
UNITED SPIRITS LIMITED INVESTOR MEET 24TH MAY 2021 1
Slide 2: Welcome
WELCOME HINA NAGARAJAN a an td
Slide 3: FY21: An Eventful Year
FY21 : AN EVENTFUL YEAR International Travel ban continues Vaccine Update : 6.4 Crore Vaccinations administered (YTD MarFY21) Bars / Pubs / Restaurants Bars / Pubs / Restaurants Bars / Pubs / Restaurants Bars / Pubs / Restaurants closed closed open open Alco-Bev Manufacturing Operations Alco-Bev Man
Slide 4: The Changing Dynamics Witnessed Last Year
THE CHANGING DYNAMICS WITNESSED LAST YEAR 1 2 3 Alcohol to behave like Scotch poised to grow Whisky to grow at the a semi essential faster expense of beer category 4 5 6 Large SKU & Big equity Value conscious Accelerated in home brands poised to consumers to consumption deliver faster growth moderat
Slide 5: Our Response to COVID Anchored on Two Key Principles
OUR RESPONSE TO COVID IS ANCHORED ON TWO KEY PRINCIPLES Manage The Crisis Emerge Stronger 5
Slide 6: FY2021 Underlying Quarterly Performance
FY2021 UNDERLYING QUARTERLY PERFORMANCE NSV Growth Gross Margin EBITDA, Margin % 1,030 2,146 2,489 2,224 429 904 1,110 978 (78) 270 384 412 TOTAL (51.4%) (3.4%) (3.6%) 16.1% (508bps) (316bps) 24bps 103bps (2350bps) (497bps) (100bps) 531bps P&A (52.2%) 1% (0.7%) 25.8% 27.6% 28.6% 29.5% 30.5% 66.0% 70
Slide 7: Today's Agenda
TODAY’S AGENDA 01 FY21 Strategic Building Blocks 02 FY21 Financial Highlights 03 Looking Ahead 7
Slide 8: Today's Agenda
TODAY’S AGENDA 01 FY21 Strategic Building Blocks 02 FY21 Financial Highlights 03 Looking Ahead 8
Slide 9: Diageo India: Our Strategic Priorities
DIAGEO INDIA: OUR 5 STRATEGIC PRIORITIES To be one of the best performing, most trusted and respected consumer products companies in India 5 Strategic Priorities Strengthen & Drive productivity Evolve route to Corporate Winning accelerate core to invest in consumer citizenship organization brands gr
Slide 10: Diageo India: Our Strategic Priorities
DIAGEO INDIA: OUR 5 STRATEGIC PRIORITIES To be one of the best performing, most trusted and respected consumer products companies in India 5 Strategic Priorities Strengthen & Drive productivity Evolve route to Corporate Winning accelerate core to invest in consumer citizenship organization brands gr
Slide 11: Our Brand Portfolio and Key Passion Points
01 OUR BRAND PORTFOLIO AND KEY PASSION POINTS PROGRESS FOOD UNWIND & RELAX CRICKET MUSIC 11
Slide 12: Keep Walking: #WalkInWithJohnnie
01 KEEP WALKING : #WALKINWITHJOHNNIE 1 LAUNCH FILM - INVITATION Opening film to promote the message 2 AMPLIFICATION Engage celebs & influencers to amplify #WalkInWithJohnnie 3 COMMUNITY X INCA partnership to engage bar owners 4 FINALE FILM 5 INSTALLATIONS Striding man installation created by glass a
Slide 13: Black & White: Made for Sharing
01 BLACK & WHITE: MADE FOR SHARING Black & White Rules IWD Campaign DRIVING SALIENCE AT HOME 13
Slide 14: Black Dog | Savour the Pause
01 BLACK DOG | SAVOUR THE PAUSE Topical content with India’s Top Comedian Product Led Content centered around WFH Theme 14
Slide 15: Hipster Re-invigorating Whisky
01 HIPSTER RE-INVIGORATING WHISKY 15 15
Slide 16: RC-RCB Integrated Campaign
01 RC-RCB INTEGRATED CAMPAIGN Digital Activation with RCB players promoting RCW YouTube ‘Creator Award’ for surpassing 1M subscribers for Special edition RCB players jersey inspired IPL pack RCB YT Channel 16
Slide 17: McDowell's No1: The True Bonds of Yaari
01 MCDOWELL’S NO1 : THE TRUE BONDS OF YAARI “Music” EXPRESS EXPERIENCE ENABLE No.1 YAARIJAM ORIGINALS No.1 YAARIJAM FESTS No.1 YAARIJAM PADS Content/Activation in F21 17
Slide 18: Innovation / Renovation Being at the Heart
01 INNOVATION / RENOVATION BEING AT THE HEART 18
Slide 19: Diageo India: Our Strategic Priorities
DIAGEO INDIA: OUR 5 STRATEGIC PRIORITIES To be one of the best performing, most trusted and respected consumer products companies in India 5 Strategic Priorities Strengthen & Drive productivity Evolve route to Corporate Winning accelerate core to invest in consumer citizenship organization brands gr
Slide 20: Optimally Serving the Three Indias
02 OPTIMALLY SERVING THE THREE INDIAs AFFLUENT INDIA MIDDLE INDIA ASPIRING INDIA Deliver unique, curated Leverage outlets to build brand Focus on retained states, experiences equity & aid premiumization support franchisees “Horses for Courses”- led front line sales force optimization Leveraging tech
Slide 21: Scotch: Focused Interventions
02 SCOTCH : FOCUSED INTERVENTIONS WIN @ HOME WIN @ STORE WIN @ ON TRADE Scaled up Hipster pack Standout visibility Go after duty free Raise the Bar program to help customers get the community kick-start @ MoTs business Festive Took the lead in welcoming Enabled the in-home packs consumers back to th
Slide 22: Win @ Store in the Festive Season
02 WIN @ STORE IN THE FESTIVE SEASON BUNDLED PORTFOLIO PROMOS & LEP’s NEW VISUAL IDENTITY UNLEASHED Continued scale up of clutter breaking visibility 22
Slide 23: Scale On-Ground Renovations
02 SCALE ON-GROUND RENOVATIONS 23
Slide 24: Diageo India: Our Strategic Priorities
DIAGEO INDIA: OUR 5 STRATEGIC PRIORITIES To be one of the best performing, most trusted and respected consumer products companies in India 5 Strategic Priorities Strengthen & Drive productivity Evolve route to Corporate Winning accelerate core to invest in consumer citizenship organization brands gr
Slide 25: Productivity Across the Value Chain
03 ‘PRODUCTIVITY’ ACROSS THE VALUE CHAIN Productivity Initiatives ▪ Effective spending NRM ▪ Stronger Price Mix Supply ▪ Supply footprint Transformation Optimization ▪ Distillation performance improvement & reduction in maturation losses ▪ Visibility elements rate productivity Marketing ▪ Volume reb
Slide 26: Diageo India: Our Strategic Priorities
DIAGEO INDIA: OUR 5 STRATEGIC PRIORITIES To be one of the best performing, most trusted and respected consumer products companies in India 5 Strategic Priorities Strengthen & Drive productivity Evolve route to Corporate Winning accelerate core to invest in consumer citizenship organization brands gr
Slide 27: Raising the Bar
04 RAISING THE BAR Standing with the Bar Community • Starter kit deployed in 1500 outlets • Euronics sanitization stations deployed in 1300 outlets • Dineout contactless dining deployed in 1110 outlets • Samsung 50” screens + TagTalk customized content in 400 outlets • Zomato digital ads across 1070
Slide 28: Our Sustainability Journey
04 OUR SUSTAINABILITY JOURNEY • “Act Smart India” on • Global hospitality skills • Initiated programme to Underage Consumption programme “Learning for replenish 20Bn m3 of Life“ water in FY 21 • Moderation through DRINKIQ • Empowering women • Reduced GHG emissions generating sustainable by 79% • UNI
Slide 29: Diageo India: Our Strategic Priorities
DIAGEO INDIA: OUR 5 STRATEGIC PRIORITIES To be one of the best performing, most trusted and respected consumer products companies in India 5 Strategic Priorities Strengthen & Drive productivity Evolve route to Corporate Winning accelerate core to invest in consumer citizenship organization brands gr
Slide 30: Winning Organization: Talent, Culture, Simplification
05 WINNING ORGANIZATION TALENT CULTURE SIMPLIFICATION ENGAGE & ENERGIZE 30
Slide 31: FY21 Financial Highlights Agenda
01 FY21 Strategic Building Blocks 02 FY21 Financial Highlights 03 Looking Ahead 31
Slide 32: FY21 Financials: Business Showed Sequential QoQ Recovery
F21 FINANCIALS : BUSINESS SHOWED SEQUENTIAL QOQ RECOVERY Q1 Q2 Q3 Q4 FY21 16% 1% 0% 12% 19% 1 Net Sales -13.2% -54% -49% -7% -3% -4% -4% P&A net sales -7.2% -51% Reported Net Sales Underlying Net Sales Underlying without AP Popular net sales -17.7% Gross Margin -15.9% (140 bps) Q1 Q2 Q3 Q4 26% 31% 2
Slide 33: Decoding FY NSV Performance
DECODING FY NSV PERFORMANCE Total Net Sales - F21 vs F20 COVID Q4 F20 : (2.4)%, -240cr COVID Q1 F21 : +10.6%, In INR Crore +956cr -13.2% + CR 2% 2.4% 3.7% 3.0% CR 8.2% P&A Net Sales - F21 vs F20 COVID Q4 F20 : (2.7)%, -178cr COVID Q1 F21 : +10.4%, 5.4% +5.9% +638cr -7.2% 7.7% + CR CR 33
Slide 34: EBITDA Margin Shadowing NSV Recovery QoQ
EBITDA MARGIN SHADOWING NSV RECOVERY QOQ 16.6% 15.9% * 12.5% Q1 Q2 Q3 Q4 18.5% 15.4% (67)bps (149)bps 84 bps (106)bps (167)bps 12.6% Rs Crore -7.5% 988 Underlying EBITDA decline is attributable to; 1405 ▪ Q1 lock-down Reported EBITDA margin down 405bps Underlying EBITDA margin down 337 bps ▪ Andhra
Slide 35: FY21 PAT Margin Mirroring the EBITDA Performance
FY 21 PAT MARGIN MIRRORING THE EBITDA PERFORMANCE 7.7% 405bps 11bps (66)bps (0.4)bps (193)bps 272bps 3.9% Rs Crore 310 35
Slide 36: Strong Cash Generation Momentum Continues
STRONG CASH GENERATION MOMENTUM CONTINUES Rs. Crore 49 36
Slide 37: Progressing Towards Zero Debt
PROGRESSING TOWARDS ZERO DEBT Debt reduction of Rs. 1517 Cr. Interest saving of Rs. 25Cr. Net debt Debt-Equity ratio Interest Cost Interest Coverage ratio Rs Crore 6.9 2.7 2,073 191 5.6 2.1 4.8 4.2 1.5 1.3 1.3 2.6 166 0.8 2.0 556 0.5 153 0.9 0.1 91 19-20 13-14 14-15 15-16 16-17 17-18 18-19 20-21 Net
Slide 38: Exiting F21 with Prior Year EPS Metrics
EXITING F21 WITH PRIOR YEAR EPS METRICS EPS Rs/share Return on Capital Employed 22.5% 21.7% F14 FY F15FY F16FY F17FY F18FY F19FY F20FY Q1 F21 Q2 F21 Q3 F21 Q4 F21 F21FY 19.0% 13.5 9.7 16.9% 7.7 9.1 15.9% 2.3 3.2 2.3 4.3 1.8 12.6% -3.0 7.4% -26.9 13-14 14-15 15-16 16-17 17-18 18-19 19-20 20-21 -1.1%
Slide 39: Looking Ahead Agenda
01 FY21 Strategic Building Blocks 02 FY21 Financial Highlights 03 Looking Ahead 39
Slide 40: In Short Term, We Are Committed To… Employees
IN SHORT TERM, WE ARE COMMITTED TO… Self Salary Isolation Advances Rooms Vaccination Enhanced COVID Care Medical Leave for Reimbursement Employees self and Dependent Free Tele Domiciliary Consultation Medical expense Employee Assistance Program In case of demise of an employee, committing additional
Slide 41: And Society
AND SOCIETY 16-bed mini-hospital units in 15 ‘most needy’ 1 districts PSA Oxygen Plants to nodal 2 Government Hospitals in 21 districts 3 Medical equipment and consumables 4 Oxygen Concentrator, Ventilators & ICU Beds 41
Slide 42: While the Short to Medium Term Outlook Remains Uncertain…
While the short to medium term outlook remains uncertain… 42
Slide 43: We Are Committed to Our Long Term Initiatives
WE ARE COMMITTED TO OUR LONG TERM INITIATIVES SOCIETY 2030 SPIRIT OF PROGRESS By 2030 Diageo will deliver a positive impact on society everywhere we live, work, source and sell 43
Slide 44: And We Have Reason to Be Optimistic
AND WE HAVE REASON TO BE OPTIMISTIC Consumer Opportunity Long-Term Premiumization Category Resilience 32.5% 26.8% 18.0% 12.0% 12.0% 9.8% 9.8% 8.8% 8.4% 8.5% 8.9% 7.7% 7.9% 7.9% 7.9% 8.1% 7.7% 7.9% 7.4% 6.4% 5.2% 5.5% 4.8% 4.0% 4.0% 3.8% 3.8% 2.4% 2.8% 3.1% 2.6% 1.8% 1999 2000 2001 2002 2003 2004 200
Slide 45: A Spirited Journey of Holistic & Breakthrough Transformation
A SPIRITED JOURNEY OF HOLISTIC & BREAKTHROUGH TRANSFORMATION THAT HAS CREATED A SOLID RUNWAY FOR THE FUTURE TRANSFORMED BIG SHIFTS IN TALENT & PROFITABLE GROWTH REPUTATION CULTURE 45
Slide 46: Thank You
THANK YOU If you wish to ask a question, please dial-in to the following numbers. Please log out of the webcast if you ask a question to avoid echo/voice quality issues. +91 22 6280 1250` Universal Dial-In +91 22 7115 8151 International Toll Free Hong Kong 800964448 Singapore 8001012045 UK 080810115