IFRS Results for the year ended 31 December Results Presentation 9 February 2011

Transcription

1 IFRS Results for the year ended 31 December 2010 Results Presentation 9 February

2 Disclaimer The information contained herein includes forward-looking statements which are based on current expectations and assumptions about future events. You should not place undue reliance on these forward looking statements. These forwardlooking statements are subject to risks, uncertainties and assumptions about Coca- Cola Hellenic including, among other things, its future financial position and results, its financial outlook, the effects of recent acquisitions to its business and financial condition, future dealings with The Coca-Cola Company, budgets, projected levels of consumption and production, projected raw materials and other costs, future taxation, estimates of capital expenditure and plans and objectives of management for future operations. These and other risks are described in Coca-Cola Hellenic s Annual Report on Form 20-F filed with the US Securities and Exchange Commission. As a result, Coca-Cola Hellenic s actual results could differ materially from those anticipated in the forward looking statements. No one undertakes to publicly update or revise any forward-looking statement unless required by law. Unless otherwise specified, all financial information presented herein is based on Coca-Cola Hellenic s IFRS financial statements. 2

3 Group results overview FY 10 Q4 10 Volume (m uc) 1% 6% Net sales ( m) 4% 7% Comparable EBIT ( m) 5% 1% Reported EBIT ( m) 1% -30% Comparable EPS ( ) 9% >100% Reported EPS ( ) 6% >100% Financial indicators on a comparable basis exclude the recognition of restructuring costs incurred in both periods under review, and the insurance payments received in in respect of damage sustained at our Nigerian operation in

4 Reconciliation of Reported to Comparable financial indicators Full Year 2010 Full year EBIT Net profit EPS EBIT Net profit EPS Reported results Restructuring costs Other items (32.8) (20.9) (0.06) Comparable results Q Q4 EBIT Net profit EPS EBIT Net profit EPS Reported results Restructuring costs Other items (22.8) (14.2) (0.04) Comparable results (numbers in m, except per share data) Financial indicators on a comparable basis exclude the recognition of restructuring costs incurred in both periods under review, and the insurance payments received in in respect of damage sustained at our Nigerian operation in In Q4 we booked a tax charge of 19.8 million ( 0.06 per share) related to the Extra Contribution of Social Responsibility by the Large Companies that was enacted by the Greek Government in December. Similarly, in Q we booked a tax charge of 21.2 million ( 0.06 per share) related to the Extra Social Contribution Tax enacted by the Greek government in May

5 Highlights 1% volume growth in 2010; strong performance in emerging markets (+6%) more than offset the weakness in established territories (-3%) FY 10 net sales revenue grew 4%, benefiting from higher volumes and positive currency movements Trademark Coca-Cola grew 4% in 2010, driven by strong growth in emerging markets. Brand Coca-Cola Zero grew 7% in 2010, reflecting strong growth in established and developing markets Comparable operating profit increased by 5% in the quarter with broadly stable margins Strong cash flow generation of 549 million in 2010, with net capital expenditure of 439 million Comparable FY 10 EPS was 1.24, 9% above the prior year Preparations undertaken in 2010 enabled the successful roll-out of SAP Wave 2 in six more countries in January

6 Factors influencing operating performance Challenging economic environment persists across most of our established markets and the Balkans Overall consumer spending continues to be hindered by high unemployment and reduced purchasing power Improving conditions in several key countries including Russia, Ukraine, Switzerland and the Czech Republic Adverse package mix persisted in 2010 with volume sales of single-serve packages down 1%; volume sales of multi-serve packages grew by 3% Pricing environment is subdued as inflation remains at low levels across our territory and consumer household incomes remain under pressure In 2010 we incurred pre-tax charges of 37 million related to restructuring initiatives, resulting in annualised benefits of million The appreciation of local currencies against our reporting currency, the euro, benefited 2010 operating profit by approximately 74 million 6

7 Established markets EBIT margin* 10.3% -92 bps 4.9% -97 bps Volume increased by 1% in the quarter and declined by 3% in the full year Volume in Greece declined by mid single-digits in 4Q 10, an improvement over previous quarters, which reflects successful Christmas activation. Further, we compensated for some of the volume due to the transportation strike in September. Full-year volume declined by 11% Volume in Ireland showed mid single-digit growth in the quarter, supported by successful promotional activity. Trademark Coca-Cola grew by mid single-digits in 4Q 10. For the full year volume declined by 2% Volume in Switzerland grew by high-single digits in the quarter and by 4% in the full year. Our listing of trademark Coca-Cola in one of the largest retail chains in the country and better economic conditions resulted in volume and value share gains in Switzerland Comparable EBIT in the full year declined by 11% as lower volumes and adverse category and package mix more than offset the lower cost of goods sold, the benefit of earlier cost savings and positive currency movements (*) Financial indicators on a comparable basis exclude the recognition of restructuring costs incurred in both periods under review FY '10 change Q4 '10 change Volume (m u.c.) 718-3% 165 1% Net sales revenue ( m) 2,835-3% EBIT ( )* % 31-17% 7

8 Developing markets FY '10 change Q4 '10 change Volume (m u.c.) 392 1% 91 8% Net sales revenue ( m) 1,140-1% 251 6% EBIT ( )* 92-6% 10-20% EBIT margin* 8.0% -42 bps 3.9% -127 bps 4Q 10 volume increased by 8%, following a 13% decline in the prior year same quarter. Full year volume increased by 1% Volume in Poland grew slightly in the quarter. Core sparkling beverages and particularly Coca-Cola Zero and Coca-Cola light brands were the main volume contributors. Full year volume grew by 1%. We continue to witness a shift towards modern trade and we are adapting our business to address this change Volume in the Czech Republic grew by double-digits in 4Q 10, reflecting an improving economic environment and successful promotional activity, particularly in modern trade. Full year volume increased by 7%. At the same time, we increased our share in sparkling beverages in 2010 Volume in Hungary showed high single-digit growth in the quarter on the back of double-digit growth in brand Coca-Cola. Economic conditions remain challenging. In 2010 volume declined by 3% The decline in EBIT reflects unfavourable package & channel mix and increased marketing expenses, which more than offset the benefits of higher volumes, better category mix, favourable currency movements and lower distribution & administrative costs (*) Financial indicators on a comparable basis exclude the recognition of restructuring costs incurred in both periods under review 8

9 Emerging markets FY '10 change Q4 '10 change Volume (m u.c.) 990 6% 224 9% Net sales revenue ( m) 2,819 14% % EBIT ( )* % 21 87% EBIT margin* 10.6% 143 bps 3.4% 126 bps Volume in 4Q 10 grew by 9%, cycling a 13% decline in the comparable prior year period Volume in Russia increased in the high-teens in 4Q 10, cycling a significant decline in the prior year quarter. Brand Coca-Cola grew 37% in 4Q 10, partly due to targeted activation programmes during the holidays. In juice, our Dobry brand remains the most preferred brand in Russia. Full year volume increased by 14% Volume in Ukraine grew by 9% in the full year, reflecting doubledigit volume increase for brand Coca-Cola and strong double-digit growth in juice Volume in Nigeria grew by 5% for the full year, supported by the successful introduction of our ultra-glass bottle and increased availability of one way packs Volume in Romania showed mid single-digit growth in the quarter despite continuous challenging conditions. Sparkling beverages led volumes, while we expanded our sparkling share in 2010 Comparable EBIT grew 32% in 2010, benefiting from higher volumes, better pricing, category mix and currency movements. (*) Financial indicators on a comparable basis exclude the recognition of restructuring costs incurred in both periods under review, and the insurance payments received in in respect of damage sustained at our Nigerian operation in

10 2010 innovation highlights Fruice Dilute flavour range Ireland Amita Orange (low acidity) Greece ultra glass bottle Nigeria Nestea Strawberry & Aloe Vera Bulgaria New Fanta Orange Coca-Cola collectable slim can Ukraine Romerquelle Emotion Apple Red currant Austria 10

11 Business outlook We continue to experience difficult economic and trading conditions in several key markets We continue to invest behind our brands focusing on using the right packages, the right brands and tailored outlet activation to address a changing retail environment As a result of volatile economic conditions, fragile consumer sentiment and a transforming retail environment we anticipate price increases slightly below inflation Due to higher world sugar and resin prices, as well as increasing pressures in certain juices we expect a mid single-digit increase in raw material prices We plan to implement further restructuring initiatives in 2011 that will result in approximately million charges. These are expected to result in approximately 8 million benefits this year and million benefits from 2012 onwards Cumulative net capital expenditure over the 3-year period ending 2013 is expected to be approximately 1.5 billion. We expect to generate approximately 1.6 billion of free cash flow in the same period 11

12 IFRS Results for the year ended 31 December 2010 Financial Overview 12

13 Full year 2010: P&L highlights (reported) EURO (million) Full Year 2010 Full Year 2010 vs Volume (million u.c.) 2, , % Net Sales Revenue 6, , % Gross Profit 2, , % Operating Expenses (2,099.0) (1,999.3) 5% Operating Profit (EBIT) % Net Profit % EBITDA 1, , % Gross Profit Margin 40.4% 40.3% EBIT Margin 9.5% 9.8% EBITDA Margin 15.4% 15.6% 13

14 Full year 2010: P&L highlights (comparable) EURO (million) Full Year 2010 Full Year 2010 vs Volume (million u.c.) 2, , % Net Sales Revenue 6, , % Gross Profit 2, , % Operating Expenses (2,062.3) (1,987.2) 4% Operating Profit (EBIT) % Net Profit % EBITDA 1, , % Gross Profit Margin 40.4% 40.3% EBIT Margin 10.0% 9.9% EBITDA Margin 16.0% 15.6% Financial indicators on a comparable basis exclude the recognition of restructuring costs incurred in both periods under review, and the insurance payments received in in respect of damage sustained at our Nigerian operation in

15 Full year 2010: Gross Profit (reported) EURO (million) Full Year 2010 Full Year 2010 vs Net Sales Revenue 6, , % Cost of Sales (4,049.6) (3,905.5) 4% Gross Profit 2, , % Net sales revenue per unit case was up by 7 cents, 2% vs Cost of sales per unit case was up by 4 cents, 2% vs Gross profit per unit case increased by 3 cents, 2% vs Gross profit margin increased by 10bps to 40.4% 15

16 Full year 2010: Opex per unit case (comparable) EURO Full Year 2010 Full Year 2010 vs Sales % Marketing % Warehouse / Distribution % Administration % Total operating expenses % Financial indicators on a comparable basis exclude the recognition of restructuring costs incurred in both periods under review, and the insurance payments received in in respect of damage sustained at our Nigerian operation in

17 Full year 2010: Net Profit (reported) EURO (million) Full Year 2010 Full Year 2010 vs Operating profit (EBIT) % Finance costs & other (73.2) (74.7) -2% Profit before tax % Tax (136.9) (142.5) -4% Minority interests (11.7) (22.4) -48% Net Profit % Earnings per Share (in euros) % 17

18 Full year 2010: Net Profit (comparable) EURO (million) Full Year 2010 Full Year 2010 vs Operating profit (EBIT) % Finance costs & other (73.2) (74.7) -2% Profit before tax % Tax (145.6) (147.2) -1% Minority interests (13.2) (11.9) 11% Net Profit % Earnings per Share (in euros) % Financial indicators on a comparable basis exclude the recognition of restructuring costs incurred in both periods under review, and the insurance payments received in in respect of damage sustained at our Nigerian operation in

19 Full year 2010: Free Cash Flow EURO (million) Full year 2010 Full year 2010 vs Adjusted EBITDA* 1, , Change in Working Capital Tax paid (141.0) (89.3) (51.7) (Gain)/ Loss on asset disp Cash Flow from operations Net capital expenditure (439.4) (451.0) 11.6 Free Cash Flow (*) We define adjusted EBITDA as operating profit before deductions for depreciation (included both in cost of goods sold and in operating expenses), impairment of property, plant and equipment, stock option compensation, impairment of intangible assets, amortisation of and adjustments to intangible assets, non-recurring items and other non-cash items. 19

20 Q4 2010: P&L highlights (reported) EURO (million) Q Q vs Volume (million u.c.) % Net Sales Revenue 1, , % Gross Profit % Operating Expenses (517.9) (482.8) 7% Operating Profit (EBIT) % Net Profit >100% EBITDA % Gross Profit Margin 37.6% 39.2% EBIT Margin 2.9% 4.5% EBITDA Margin 10.5% 11.7% 20

21 Q4 2010: P&L highlights (comparable) EURO (million) Q Q vs Volume (million u.c.) % Net Sales Revenue 1, , % Gross Profit % Operating Expenses (500.7) (485.4) 3% Operating Profit (EBIT) % Net Profit >100% EBITDA % Gross Profit Margin 37.6% 39.2% EBIT Margin 4.1% 4.3% EBITDA Margin 11.7% 11.1% Financial indicators on a comparable basis exclude the recognition of restructuring costs incurred in both periods under review, and the insurance payments received in in respect of damage sustained at our Nigerian operation in

22 Q4 2010: Gross Profit (reported) EURO (million) Q Q vs Net Sales Revenue 1, , % Cost of Sales (933.0) (847.4) 10% Gross Profit % Net sales revenue per unit case was up by 3 cents, 1% vs Q4 Cost of sales per unit case increased by 7 cents, 4% vs Q4 Gross profit per unit case was 4 cents lower, -3% vs Q4 Gross profit margin decreased to 37.6% from 39.2% (a decrease of 160 bps versus last year) 22

23 Q4 2010: Opex per unit case (comparable) EURO Q Q vs Sales % Marketing % Warehouse / Distribution % Administration % Total operating expenses % Financial indicators on a comparable basis exclude the recognition of restructuring costs incurred in both periods under review, and the insurance payments received in in respect of damage sustained at our Nigerian operation in

24 Q4 2010: Net Profit (reported) EURO (million) Q Q vs Operating profit (EBIT) % Finance costs & other (21.2) (19.4) 9% Profit before tax % Tax (0.8) (30.3) -97% Minority interests (1.9) (10.1) -81% Net Profit >100% Earnings per Share (in euros) >100% 24

25 Q4 2010: Net Profit (comparable) EURO (million) Q Q vs Operating profit (EBIT) % Finance costs & other (21.2) (19.4) 9% Profit before tax % Tax (4.9) (31.8) -85% Minority interests (2.4) (2.9) -17% Net Profit >100% Earnings per Share (in euros) >100% Financial indicators on a comparable basis exclude the recognition of restructuring costs incurred in both periods under review, and the insurance payments received in in respect of damage sustained at our Nigerian operation in

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