I N V E S T O R P R E S E N TAT I O N

Transcription

1 I N V E S T O R P R E S E N TAT I O N F U L L Y E A R F I N A N C I A L R E S U LT S A S A T 3 0 J U N E R i c h a r d R u s h t o n G r o u p C E O L u c a s V e r w e y G r o u p C F O

2 G R O U P P E R F O R M A N C E Strong revenue and EBITDA performance in tough economic and competitor environment Volumes up 4.4% Revenue up 7.7%* EBITDA growth of 7.4% HEPS growth of 5.1% Net cash generation up 21.6% ROIC up 40bps (13.1%) Performance normalised FX, * Post excise Overall Volume growth in all three reporting regions South Africa: Grew RTD share; volumes in all 3 categories Africa: Exceptional performances in Botswana, Kenya, Zambia and Zimbabwe International: Strong travel retail performance Commendable revenue growth from 13 of 15 largest brands Continued double-digit volume and revenue growth from Savanna and Bernini amidst increased RTD competitor activity HEPS negatively impacted by once-off TDL write-off, FX adjustment, interest accrual reversal and impairments

3 OUR S T R A T E G I C A S P I R A T I O N S Double revenue growth & EBITDA By 2021 Grow and win In South Africa Expand into Africa & one major International market Leverage core Brand portfolio Focussed our portfolio Grown share 1in 4 SA 0 3 and 2built capability Platforms established in Kenya, Angola & Nigeria

4 R E G I O N A L P E R F O R M A N C E

5 S O U T H A F R I C A P E R F O R M A N C E H I G H L I G H T S Solid Volume growth in all 3 categories amidst strong competition and challenging economy Top 5: Macro drivers of change Volumes up 4.4% Revenue up 9.9% RTD Volumes up 4.7% Savanna (23%) and Bernini (43%) lead the category Spirit Volumes up 6.7% Brandy growth still resilient Gin delivered strong double digit growth Vodka showing strong double digit growth lead by Cruz and Count Pushkin Whisky recovery in H2 due to more competitive pricing Wine Volumes up 3.2% (7% in 2H) Double-digit growth from Drostdy-Hof, Nederburg, Alto, Fleur Du Cap, Pongrácz and Two Oceans Stronger H2 mainly driven in mainstream. Mix shift and increased trade incentives impacting gross profit

6 S O U T H A F R I C A M A R K E T E X E C U T I O N Step up in execution and customer reach translating into revenue and market share growth 80% 70% 60% 50% 40% 30% 20% 10% 53% 75% 60% 58% 45% 64% 54% 50% 61% 50,0% 45,0% 40,0% 35,0% 30,0% 25,0% 20,0% 42,9% 41,3% 41,2% 30,0% 30,7% 31,0% DISTELL: % VOLUME SHARE BY SA LIQUOR CATEGORY 0% Accessibility Affordability Availability 15,0% 10,0% 8,5% 8,5% 8,9% 12,5% 12,6% 13,1% ,0% ,0% RTD/BEER WINE SPIRITS TOTAL Jun 17-Jun 18-Jun * Southern Africa Significant improvement in execution has been delivered across the 3 A s Customer reach has consistently improved with direct sales calling evolved from a base of 14,000 to 44,000 in 4 years Over 20,000 customers registered in 2018 for Bansela - mainstream total service package

7 A F R I C A P E R F O R M A N C E H I G H L I G H T S Building a long-term platform to unlock growth Volumes up 7% Revenue up 19.5% Solid growth in BLNS driven largely by Botswana Exceptional triple digit volume and revenue growth in Kenya Zimbabwe double-digit volume and revenue growth driven by locally produced ciders Growth in categories attributed to: Wines: Double-digit revenue growth led by JC le Roux and Nederburg RTDs: Solid revenue growth led by Hunters and Kingfisher Spirits: High double-digit revenue and volume growth led by Kibao, Viceroy and Hunters Choice Currency devaluations and cash availability significantly impacted H2 performance in Angola ZAR 85.9m negative impact from TDL associate Export products remain out priced against local competitors We will compete more efficiently by: Portfolio rationalisation and enhanced marketing focus on key brands Accelerating local production and RTM in key markets

8 A F R I C A : L E V E R A G E O F F A N G O L A A N D K E N YA P L AT F O R M S Surpassed 1 st year volume and revenue targets Best Global Brands (BGB) Strong volume performance with 46m litres sold Angola (33m litres) Nigeria (12m litres) Rest of Africa (0.7m litres) Profit impacted by 50% currency devaluation in H2 and FX restrictions in Angola Nigerian transition near completion Production and distribution in Kenya by Q4 Potential to expand offerings in key markets LOCAL KPI s (Based in USD) JUN 2018 YTD Gross Margin 41.1% A&P % of NSV 3.7% Cash Opex % of NSV 6.3% EBITDA Margin 3.4% KWA Holdings EA Exceptional growth well above expectation Well balanced portfolio after acquisition of Distell Winemasters further bolstered by BGB products Key market share statistics : Mainstream White spirit 9.11% Mainstream Brandy 20.17% Mainstream Whisky 20.63% RTD 8.00% Premium Liqueur 42.6% LOCAL KPI s (Based in KES) JUN 2018 YTD Sales Volumes (ltrs) 31.9% Net Sales Revenue 24% JUN 2018 YTD Gross Margin 47.6% A&P % of NSV 7.9% Cash Opex % NSV 26.6% EBITDA Margin 13.8%

9 I N T E R N AT I O N A L P E R F O R M A N C E H I G H L I G H T S Leveraging pockets of opportunity Top 5: Macro drivers of change Volumes up 0.4% Revenue up 2.6% Positive performances in Europe, Travel Retail, Latin America & APACME regions UK retail listings driving sales growth in wine Scottish Leader market share 80bps growth in Taiwan Amarula: Strong performance in Argentina, UK and Asia Pacific Strong growth in Scotch single-malts and Brand Homes Canada: Early signs of Two Oceans recovery due to pack upgrade; Consolidation of RTM Increased investment behind key brands including Savanna in the UK Positive contribution from bulk sales Stronger ZAR impacted revenue growth

10 B R A N D C AT E G O R Y P E R F O R M A N C E

11 C I D E R S A N D R T D S Volumes up 4.3% Revenue up 8.2% Hunter s Dry: Positive growth in H2, brand health steady Gold: Under pressure, Brand Equity investment Extreme: Commendable profitability growth Black Coffee partnership : Excitement and engagement growing reach Q3 Hunter s Digital and TV activity building next phase of campaign Savanna Strong H2 17% Volume growth driven by 500ml variant and 12 packs Dry: Unapologetic campaign drove increased brand health Newcomers Comedy Showcase positioned brand to own local comedy Loco: Bokeh partnership generating premium halo effect on the brand Bernini +43.9% volume and +51.6% Revenue growth Launch of Ruby Berry performed ahead of expectations Growing brand health due to investment in brand innovation and TTL communication

12 M A I N S T R E A M S P I R I T S Volumes up 1.2% Revenue up 1.5% Brandy Category grew +7.6% by Volumes & +16% in Revenue Richelieu and Viceroy showing double-digit revenue growth Increased marketing investments behind key brands to enhance brand health Scottish Leader Blended Whisky volumes still under pressure Taiwan: Gaining share in a declining market South Africa: Single-digit revenue growth Successful gifting season and exciting launch of the I See a Different You partnership

13 P R E M I U M S P I R I T S Volumes up 12.6% Revenue up 14.5% Bain s Excellent growth driven by South Africa New pack, TVC and growing on premise presence Positive brand health indicators in response to increased investment in marketing and sales support Amarula Growth across all breakout markets Growth driven by global Made From Africa campaign Awards: IWSC Silver 2018, Brand of the Year 2017 and a Silver APEX 2018 Cruz Vodka Strong growth reaching scale Positive brand health: Platform for future growth

14 M A I N S T R E A M W I N E Volumes up 2% Revenue up 6.2% 4 th Street Drostdy-Hof Paarl Perlé Growth supported by extensive PR and Digital campaigns; launch of Limited Edition BiB High double-digit Volume and Revenue growth in Africa, single digit growth in SA TVC debut in Q3; Project Runway association Category under pressure from beer/rtd category SA consumer trading up, increased volumes by +51% and revenue by +53%. Outperforming category trend: Adelpracht halo effect driving growing brand health, launch of pack upgrade and Share your moments campaign Commendable volume growth and double digit revenue growth Competing against new entrants in the category

15 P R E M I U M W I N E Benefiting off focus Volumes up 5% Revenue up 11.6% NEDERBURG: Double-digit volume and revenue growth driven by SA and UK DURBANVILLE HILLS: Growth across all SA regions and key customers FLEUR DU CAP: Building new brand positioning ALTO: Double-digit growth in SA driven by Alto Rouge and 1693 PONGRACZ: Growth across all SA regions ; successful launch of Noble Nectar ALLESVERLOREN: High double-digit growth in volumes and revenue driven by Sweden and SA NEW PREMIUM WINE ENTITY created to focus on leveraging premium wine potential, build brand scale and relevance and drive margins and long term returns in the segment

16 D R I V I N G E F F I C I E N C I E S T O WA R D S M A R G I N I M P R O V E M N T

17 L'000/FTE P E O P L E I N V E S T M E N T A N D O P T I M I S A T I O N CAPABILITY PERFORMANCE Supply Chain: Employee Productivity CORPORATE AFFAIRS Regulatory, Excise and Sustainability capability shift Transformation focus 95% of all direct and indirect procurement now managed centrally to global best practice Network optimisation initiatives impacting positively on efficiency and productivity Employee productivity CAGR of 6.4% since FY % CAGR Act 15 Act 16 Act 17 Act SHARED SERVICES (HIVE) Multi functional Procurement, Ordering and HR capability Training investment up +14% B-BBEE Level 4 maintained Head count Productivity R16m headcount saving HR Training spend Recruitment drive Culture shaping

18 A C C E L E R A T E D N E T W O R K O P T I M I S A T I O N DISTILLERY CONSOLIDATION WADEVILLE 1ST BIB LINE WADEVILLE 2ND BIB LINE BERGKELDER EXIT MONIS FREEZE PLANT SPRINGS FERMENTATION & BLENDING MONIS OPTIMISATION SPRINGS L1 RETURNABLE CAPACITY SPRINGS FERMENTATION & BLENDING I SPRINGS FERMENTATION & BLENDING II R978m CAPEX CAPACITY BUILD 480m L/pa cider 70m L/pa BIB 60 m L/pa RB R205m Annual Cost Saving Further SA & UK consolidation & optimisation into FY19/20

19 S U S TA I N A B I L I T Y

20 C R A F T I N G A L A S T I N G L E G A C Y SOCIETY ENVIRONMENTAL ECONOMY Good corporate citizenship Alcohol harm reduction Robust stakeholder relationships Socio-economic growth Transformation as a business enabler Excellence in water stewardship Reduce carbon footprint Resource efficiency Sustainable farming programmes Alignment to UN practices Market growth Significant contribution to the fiscus Shareholder value sustainable jobs Value & supply chain (SME) empowerment & growth

21 WAT E R M A N A G E M E N T & D R O U G H T R E S P O N S E ( W C & E C ) Water usage l/l Water usage reduction already achieved: 38.1%* (Western Cape Sites ) 34.1%* (All City of Cape Town Sites ) Three waste water reclamation projects on schedule for completion by October ,840 3,686 4,166 3,723 3,490 3,605 3,087 3,488 Accelerating our water management programme through: continued demand reduction management introducing new water saving initiatives Redirecting capital expenditure to waste water treatment and reuse programmes (R32m) Phased in BCP for all affected sites: production, distribution, sales and admin offices including Shared Services Centre (HIVE) Implement integrated employee response and care plan Target Usage The drought poses real risk to the supply and cost of grapes and wine in the medium term (2 3 years). We have secured sufficient supply for the current cycle.

22 E N V I R O N M E N T A L S U S T A I N A B I L I T Y P E R F O R M A N C E F Y 1 8 Electricity usage (kwh/l) 0,1260 0,1281 0,1294 0,1228 0,1239 0,1174 0,1161 0,1095 1,1299 1,1768 YTD Resource target reached for water, electricity, fossil fuel usage & effluent volume discharged. Fossil fuel based energy usage (MJ/l) 1,1416 1,1278 1,1104 1,1058 1,0788 1, Target Usage Target Usage Direct GHG emissions (kgco2e/l) 0,2438 0,2437 0,2381 0,2368 0,2309 0,2285 0,2207 0, Target Usage

23 F I N A N C I A L P E R F O R M A N C E

24 S A L I E N T F E AT U R E S Strong revenue and EBITDA performance translated into healthy cash flows REPORTED m REPORTED Sales volumes % 4.4% Revenue (pre excise) 24, % 9.9% Revenue (post excise) 18, % 7.7% NORMALISED FX Difference between reported EBITDA and Normalised FX EBITDA Gain on sale of investments (Lusan and Bisquit mainly) in current year Brand Phoenix, Bisquit and Angola land impairments in prior year Tanzania Distilleries Ltd (TDL) write-offs and impairments in current and prior year (12.8%) (9.2%) (13.0%) 2.7% EBITDA 3, % 7.4% Headline earnings 1,466.2 (5.6%) 5.2% Headline earnings per share Net cash from operating activities ROIC (normalised FX) = 13.1%; 40bps Total dividend = 395.0c; 4.2% 668.2c (5.7%) 5.1% 2, % Note: This presentation includes the discontinued operations of Bisquit 5 year CAGR = 37.0% FX adjustment 1.9% Other 4.8% Difference between reported HLE and normalised FX HLE Amarula interest accrual reversal in prior year 2.7% Tanzania Distilleries Ltd write-offs in current and prior year 10.8% 3.6% FX adjustment 3.1% Other 1.4%

25 K E Y TA K E - O U T S Disposal of non-core assets Optimised and consolidated supply chain network Created back-office shared service centre (HIVE) Various small businesses created in value chain Established Premium Wines business Continuously reducing portfolio tail

26 M A R G I N I M PA C T E D B Y E X C I S E P R E S S U R E Normalised FX = Index Rm 24,449 6,402 18,047 DP Revenue Excise NDP Revenue 10,222 7,825 5,433 COGS Gross Profit Expenses Trading Profit 2, ,547 Equity inc/other History Trends Normalised EBIT NDP%CY: (0.8) 14.1 NDP%PY: (0.4) 14.5 DP%CY: (0.6) 10.4 DP%PY: (0.3) 10.9

27 INPUT COSTS EXCISE M A R G I N M A N A G E M E N T Above inflationary tariff increases Category and channel mix effects Higher spirits growth contribution Cider category impacted by slower growth from lower ABV offerings UK direct sales channels now attract excise ACTIONS TAKEN Higher price increases taken Increased marketing spend to protect brand equity Portfolio value engineering initiatives underway Pursue lower ABV offerings Inflationary pressures contained through procurement benefits and efficiencies Lower overall R/l COGS increases vs. basket Cider input cost increases contained to 2.7% R/l Impact of Western Cape drought on wine and spirits input cost SA consumer under pressure, resulting in lower than inflationary sales price increases to protect market share Accelerated consolidation of production footprint Balance wine input cost increases to protect brands and enable sustainable farming practices Further input cost savings identified for new fiscal of R300m

28 D R I V E R S O F R E V E N U E G R O W T H Healthy volume and price growth supporting overall revenue growth Rm Index (0.0) ,259 24, History Volume Sales Mix Currency Price New/Disc prod + Other 2018 Actual

29 A L L G E O G R A P H I E S G R O W I N G Volumes up 4.4% Revenue up 9.8% South Africa volumes up 4.4% leading to a revenue growth of 9.9% in a competitive market 7.0% 19.5% 7.3% 14.6% 2.6% 12.1% 13.9% International Increased UK sales- and RTM capability resulting in revenue growth. Strong Travel Retail performance. 0.4% 78.1% 4.4% 74.0% 9.9% Sub-Sahara Africa (incl BLNS) KHEAL consolidation assists growth in a tough macroeconomic context Increase/decrease from prev ious year South Africa International Africa (incl BLNS) Revenue on a NDP basis outside RSA comprises 31.4% of group revenue

30 A L L C AT E G O R I E S S H O W I N G G R O W T H Volumes up 4.4% Revenue up 9.8% Volume and revenue growth across all categories 4.3% 10.7% 12.0% 8.2% 17.1% Excellent growth in spirits mainly driven by Viceroy, Richelieu and Amarula 52.3% 37.0% 2.8% Increase/decrease from previous year 35.6% 36.2% 28.2% 7.0% Spirits Wine Cider/RTD Excellent double digit growth by Savanna, indicating a resilient recovery in a tough competitive environment. Phenomenal growth by Bernini. Strong performance by Nederburg, Drostdy-Hof, and Paarl Perlè.

31 D R I V E R S O F E X C I S E G R O W T H Full excise price increase not passed to customers Index Rm ,499 6, History Volume Mix Price New Business 2018 Actual

32 C O M PA R A B L E E X P E N S E S I N C R E A S E D B Y 6. 4 % R'm R'm Trend Comparable expenses Reported - marketing spend & opex 5, , Inorganic adjustments (e.g. KWAL, Cruz) Shared Service Centre - HIVE Comparable expenses 5, ,

33 N O R M A L I S E D F X H E A D L I N E E A R N I N G S U P 5. 2 % Normalised FX Headline earnings Rm Trading profit Other gains and losses 167 2,392 Operating profit increased by 23.8% and includes the adjustment for capital items below Operating profit 2,559 1,682 Net finance cost & Div (291) inc Associates 31 Associates negatively impacted by once-off TDL items of R85.9m (June17:R22.2) 1,599 Taxation (631) 2017/ /17 Minority int Add back Capital & FX & Abnormal items (22) 36 The movement in the Capital & Abnormal items is added back to normalised FX headline earnings

34 T D L : U N D E R LY I N G B U S I N E S S I M P R O V I N G TDL DISTELL IMPACT DEC 2017 (R m) DEC 2017 TRENDS Sachet ban impacting negatively JUNE 2018 (R m) JUNE 2018 TRENDS Normal business 13, , TDL DISTELL IMPACT Normal business 31, Excise duty dispute (Included by TDL) Excise duty dispute (Distell Additional) JUNE 2018 (R m) (7,499) (22,119) JUNE 2018 TRENDS All 90 days past due debt and sachet related bad debt has been provided for (which includes the debt of Tema the main customer) Provided for 30% of excise duty dispute exposure. TDL management confident that settlement would be reached between 7.5% and 30% Staff retrenchment (375) Tema (main customer) write-off (25,328) Sachet Ban (30,550) - Stock (12,830) - Bad debt (3,958) - PPE impairment (7,410) R85.9m write-offs and impairments Property, plant and equipment (PPE) impairment relates to the sachet bottling line Outlook for TDL 2018 financial year (ending Dec 2018) is positive - Excise (6,352) Net impact on Distell Group (54,195) (100.0)

35 E X C H A N G E R AT E S ZAR remains volatile amid the changing political landscape and credit ratings uncertainty Currency 2017/ /17 Change on History GBP % EUR % USD % CAD % Average exchange rate 1 4 strengthening % on History

36 *Includes associates and JVs. Excludes deferred tax- and retirement benefit assets & liabilities. R M P O S I T I V E S W I N G I N W O R K I N G C A P I TA L C A S H F L O W Net operating assets up 6.8% (4.9% excl. FX) compared to revenue growth of 9.8%, thereby increasing net asset turnover Group Excluding exchange rate impact Net operating assets Rm Fixed and biological assets Rm 6,290 5, % Inventory Rm 7,587 7, % 14.2% -4.0% Fixed and biological assets increased mainly due to investments in the shared service centre, effluent water treatment plants and network optimisation Decrease in inventory as a result of better management of the RTD- and spirits bulk component 15, % 4.9% Accounts receivable Rm 3,413 2, % 12.9% Accounts receivable increased due to increased credit limits in SA; no significant rise in doubtful debts 14, / /17 Accounts payable and prov Rm 4,425 3, % 17.1% Accounts payable increased mainly due to growth in excise payable and extended credit terms Intangibles and Investments Rm 3,093 2, % 21.6% Intangible assets include mainly: - Goodwill and trademarks - Investments in associates and JV's of which R726.5m relates to the new investment in BGB in the current year.

37 I N TA N G I B L E S A N D I N V E S T M E N T S 10% of Distell market capitalisation - relatively small % of total business 19.4% of Net Operating assets Intangibles and investments R 3,093m Other Intangibles & Investments 8.2% Goodwill & Trademarks 59.4% Investment in Associates & JVs 32.4% GOODWILL & TRADEMARKS R m Distell Winemasters Limited 1.9 Distell Hong Kong Limited 7.5 Lusan Holdings 14.9 KWA Holdings E.A. Limited Imported Premium Vodka Company Limited Distell International Limited 1,451.6 INVESTMENT IN ASSOCIATES & JVs R m Tanzania Distilleries Ltd 49.8 Grays Inc. Limited 41.6 Best Global Brands TD Spirits LLC 66.2 Afdis Holdings 73.6 Other 6.6 OTHER INTANGIBLES & INVESTMENTS R m Software and property rights Other loans & investments 80.9

38 C A S H F L O W A N D F U N D I N G I M P R O V E D Gearing has decreased marginally Rm 3, , Net borrowing Operating profit Treasury shares Net cash position 30 June movement, net 2017 of borrowing 1,650 Working capital Distributions (fin cost, tax & dividend) intangibles Best Global Brands investment outflow R726.5m 1,145 Capex and 3,462 Net borrowing position 30 June 2018 Net cash generated from operating activities increased Medium-term borrowings R4,433m: Euro, GBP and ZAR denominated Debt/equity ratio 29.0% (June17: 33.8%) 21.6% Short-term net cash R971m: Variable rate Funding structure 2018 R'm Bank overdrafts and call accounts (113) 173 Cash and cash equivalents 1,084 Medium-term bank loans (4,420) Short-term bank loans (13) Total (3,462) Bisquit disposal net inflow of around R350.0m Debt maturity profile 2018 Rate R'm Within one year (13) Variable Between one and two years (1,200) 8.3% Between two and five years (3,220) 6.6%

39 B E N E F I T I N G A L L S TA K E H O L D E R S 1 0 Y E A R P E R I O D 100.0% 90.0% 80.0% 8.2% 9.1% Retained to fund growth 70.0% 60.0% 50.0% 24.3% Shareholders' dividends Cash value added (2009 to 2018) = R72.5bn 40.0% 30.0% 58.3% Employees CAGR = 12.5% 20.0% 10.0% 0.0% Government

40 S M A L L B U S I N E S S E S C R E AT E D Dedicated zero interest fund established More than 40 jobs created in black-owned businesses we have helped establish More than 50 jobs preserved amongst businesses supported Hundreds of new empowered suppliers onboarded and doing business with Distell R47,6m Investment in suppliers R9,2m Investment in enterprises Financial support and 100% of our maize requirement from South Africa s first black-owned commodity trading company Business development support for a 100% black-woman owned security business E N T E R P R I S E + S U P P L I E R D E V E L O P M E N T P R O G R A M M E Providing market access, zero-interest funding and business development services to empowered suppliers and enterprises Distell s programme recognised as a Top 12 finalist in 2018 AND Growth and new jobs created this year at Handwork Hub a majority women-owned supplier to Distell New business established for a majority black-owned owned catering company Leveraging our technology platform to discover and onboard new empowered suppliers more quickly Continued business manager support to our Owner-driver distribution programme All available ESD points realised in the FY Support through offtake, new equipment, growth and business development Establishment of a black-owned solar PV business NEW LAUNCHED IN APRIL 2018 Establishing direct engagement for the first time with all empowered apple farmers supplying Distell and providing tailored support to increase their yields Funding of new tooling, equipment and supplies to WG Pipefitters Set up of Now Juice a majority black-owned apple juice concentrate business to support our future juice requirements

41 P R O G R E S S O N D I S P O S A L O F N O N - C O R E A S S E T S DISPOSAL RATIONALE Sale of Bisquit Unlock balance sheet: Reduction of assets and net debt Improvement in Net debt : normalised EBITDA ratio ROA improvement Increase Distell s ROIC Core focus assets: Durbanville Hills Nederburg Alto Plaisir de Merle Unwind of LUSAN Previously caused misalignment Sale of other non-core assets This allows Distell the opportunity to focus on core assets

42 L O O K I N G A H E A D SOUTH AFRICA: Anticipate challenging macroeconomic conditions with rising costs and consumers under pressure into FY19 Leverage unique ability to compete across: categories and price continuum taste profiles mixed gender occasions Grow top-line through Cider/RTD growth, premiumisation and improved market execution AFRICA: Balance risk and opportunities by rolling out African platforms with local RTM in Angola, Nigeria and Kenya Expand BGB presence INTERNATIONAL: Grow premium spirits and wine portfolio Optimize and build a self-sufficient supply chain 1 Our Top 3 Must Win Battles in 2019 Deliver Category & Geographic Breakout Growth Increased A&P to support Cider & Spirits growth Pursue complementary M&A opportunities 2 Margin enhancement Doubling down on mix and margin managementsegment, price, pack, channel and region Capex investments to drive efficiencies Further decentralize and optimize our network, back office (HIVE) and operating model 3 Business Transformation Drive culture change, transformation and sustainability

43 Q&A I N V E S T O R C O N T A C T F r a n k F o r d f s f o r d i s t e l l. c o. z a

44 D I S C L A I M E R This presentation contains forward-looking statements, including specifically all statements that express market forecasts; Distell s commentary on macro and industry related market trends; and projections related to Distell s business strategy. All forward-looking statements contained in this presentation involve risk and uncertainty since they are dependent on assumptions of circumstances that will occur in the future. There are multiple variables which could cause actual results to differ from the forwardlooking statements which are not within Distell s management control. Such variables include, but are not limited to, political, macro and socio-economic changes; legal and regulatory changes; litigation developments; technological changes; environmental risks and changes in consumer trends, among others. As such, Distell is not liable for any financial or other losses incurred arising from investment decisions made on the basis of forward-looking statements contained in this presentation. As such, you are cautioned not to place undue reliance on the forward-looking statements contained herein, as they apply only as at the date of this presentation. All forward-looking statements made by Distell apply only as of the date they are made. There is no obligation on Distell in the future to provide updates on forward-looking statements contained in this presentation to reflect any changes in Distell s projections with regard thereto or any changes in events or underlying assumptions on which any such statement is based.