IFRS Results for the three months ended 2 April Results Presentation 29 April 2010

Transcription

1 IFRS Results for the three months ended 2 April 2010 Results Presentation 29 April

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, the effects of recent acquisitions to its business and financial condition, future dealings with TCCC, 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 filled with the US Securities and Exchange Commission. As a result, our 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 Q1 10 Q1 09 ch. Volume % Net sales ( m) 1,377 1,374 - Comparable EBIT ( m)* % Reported EBIT ( m) % Comparable EPS ( ) >100% Reported EPS ( ) >100% Free cash-flow ( m) 65 9 >100% (*) Financial indicators presented on a comparable basis exclude the recognition of restructuring costs incurred in 2009 and the insurance payments received in 2009 in respect of damage sustained at our Nigerian operation in

4 Reconciliation of Reported to Comparable financial indicators Q Q EBIT* Net profit** EPS EBIT* Net profit** EPS Reported results Restructuring costs Other items (5.2) (2.4) (0.01) Comparable results (numbers in m, except per share data) (*) Operating profit or EBIT refers to profit before tax excluding finance income / (costs) and share of results of equity method investments. (**) Profit after tax attributable to owners of the parent. Financial indicators presented on a comparable basis exclude the recognition of restructuring costs incurred in 2009 and the insurance payments received in 2009 in respect of damage sustained at our Nigerian operation in

5 Q highlights Improved operating profitability and lower capital investments resulted in an increase in free cash flow of 56 million Volumes declined 2% in the quarter, representing a significant volume trend improvement compared to Q Net sales revenues were flat versus prior year quarter, with lower volumes offset by a positive foreign currency impact Coca-Cola Trademark volumes grew 1%, reflecting increased brand investment and activation at the point-of-sale, particularly in largerformat retail outlets Gross and operating profit margins increased by 150bps and 80bps, respectively, with comparable EBIT growing by 26% in the quarter Comparable EPS of 0.07 compared to 0.02 in the prior year quarter Management has proposed a 2009 full year dividend per share of 0.30 at the Company s AGM to be held on 21 June 2010 (representing a 7% year-on-year increase) 5

6 Factors influencing operating performance Overall trading conditions remain challenging, despite early signs of recovery in some developing and emerging markets The earlier timing of Easter this year compared with 2009 benefited volumes in the quarter, particularly in future consumption channels We continue to witness a cautious consumer environment leading to continued pressure on immediate consumption channels and a 5% decline in volume sold of single serve packages in the quarter Successful implementation of SAP Wave 2 from January 2010 in Greece, Italy, Bulgaria and Cyprus without any significant business disruptions Currency neutral COGS per unit case declined 2% reflecting lower commodity prices and the benefit of last year s restructuring initiatives The appreciation of local currencies in key developing and emerging markets relative to the euro resulted in an 11 million benefit to operating profit in the first quarter 6

7 Established markets Q1 '10 % change Volume (m u.c.) 155-5% EBIT ( ) 43 - EBIT margin 7.0% +34 bps Volume performance in the quarter reflects continued challenging economic conditions in the segment Volume in Greece declined in the mid-teens, reflecting a deteriorating economic environment and reduced spending in immediate consumption channels Volume in Italy declined in the mid-single digits largely reflecting the different phasing of promotional activity versus the prior year quarter. The successful integration of SOCIB contributed to another quarter of solid profit growth Volume in Switzerland grew in the mid-single digits, reflecting more stable trading conditions and the successful listing of Coca-Cola branded products in the largest supermarket chain in the country The benefits of last year s restructuring initiatives and lower commodity costs more than offset negative channel and package mix Financial indicators presented on a comparable basis exclude the recognition of restructuring costs incurred in 2009 and the insurance payments received in 2009 in respect of damage sustained at our Nigerian operation in

8 Developing markets Q1 '10 % change Volume (m u.c.) 80 2% EBIT ( ) 1 n/a EBIT margin 0.4% +359 bps Sparkling beverages volume grew in the mid-single digits, supported by solid performances of the Coke and Sprite brands The earlier timing of Easter-related promotional activity had a positive impact to volumes in this segment Volume in Poland grew in the low single-digits driven by growth in the sparkling beverage and water categories. Volumes in Hungary and the Czech Republic grew in the low-single digits supported by strong outlet execution and an improved trading environment Comparable EBIT reached 1m, compared to losses of 7m in prior year quarter. Higher volumes, a positive currency impact and lower operating and commodity costs more than offset a negative package and channel mix impact in the quarter. Financial indicators presented on a comparable basis exclude the recognition of restructuring costs incurred in 2009 and the insurance payments received in 2009 in respect of damage sustained at our Nigerian operation in

9 Emerging markets Q1 '10 % change Volume (m u.c.) 196-1% EBIT ( ) 8 46% EBIT margin 1.5% +41 bps Volume in the segment declined 1% in the quarter, with a midsingle digit growth in trademark Coke more than offset by a lowsingle digit decline in the combined still and water categories. Russia volume declined by 2%, adversely impacted by unseasonably cold weather and continuous challenging economic conditions. This performance represents a notable volume trend improvement compared to Q4 2009, supported by double digit growth in brand Coca-Cola. Volume in Nigeria grew in the mid single-digits, as we continue to benefit from new packaging innovation, increased outlet coverage and increased juice capacity Romania volume declined in the low single-digits in the quarter. While volume trends improved from the Q4 2009, trading conditions remain challenging driven by high unemployment and ongoing weak consumer confidence. Higher pricing and a slight positive currency impact more than offset lower volumes, increased commodity costs and negative package and category mix Financial indicators presented on a comparable basis exclude the recognition of restructuring costs incurred in 2009 and the insurance payments received in 2009 in respect of damage sustained at our Nigerian operation in

10 Q innovation highlights Coca-Cola ultra glass bottle Nigeria New packaging Baltics Coca-Cola collectable slim can Ukraine Nestea Vitao Strawberry Poland & Croatia Relentless energy drink Ireland Romerquelle Emotion Apple Red currant Austria Dobry Buratino Russia 10

11 Business outlook Despite early signs of recovery in parts of Central and Eastern Europe, we continue to experience an overall cautious consumer environment Sustained high unemployment levels, increased liquidity constraints and the impact of recently introduced austerity measures across several key countries still impede consumer spending There are concerns about the deteriorating economic environment in Greece and we are closely monitoring developments in the country Based on anticipated economic developments across our territory, volume and operating profit is expected to be more weighted towards the second half of the year Through effective brand management, targeted promotional activity and strong outlet execution we aim to drive further share gains in the non-alcoholic ready-to-drink category Following the recent depreciation of the euro relative to the USD and the current oil price trends we now expect a slight increase in raw material prices for the full year Assuming current spot rates, we estimate a circa 50 million positive impact from foreign currency movements to our full year operating profit result Maintain focus on driving productivity efficiencies. The benefit from 2009 restructuring initiatives are expected to yield 30m incremental benefits to 2010 operating profit. Ongoing commitment to managing our business for growth we plan to increase marketing spend to drive consumer demand for our products over the current 3-year planning cycle Cumulative net capital expenditure over the 3-year period from 2010 to 2012 is expected to be approximately 1.4 billion. Expect to generate approximately 1.5 billion of free cash-flow from 2010 to

12 IFRS Results for the three months ended 2 April 2010 Financial Overview 12

13 Q1 2010: P&L highlights (reported) EURO (million) Q Q vs 2009 Volume (million u.c.) % Net Sales Revenue 1, , % Gross Profit % Operating Expenses % Operating Profit (EBIT) % Net Profit >100% EBITDA % Gross Profit Margin 38.9% 37.4% EBIT Margin 3.8% 2.7% 13

14 Q1 2010: P&L highlights (comparable) EURO (million) Q Q vs 2009 Volume (million u.c.) % Net Sales Revenue 1, , % Gross Profit % Operating Expenses % Operating Profit (EBIT) % Net Profit >100% EBITDA % Gross Profit Margin 38.9% 37.4% EBIT Margin 3.8% 3.0% Financial indicators presented on a comparable basis exclude the recognition of restructuring costs incurred in 2009 and the insurance payments received in 2009 in respect of damage sustained at our Nigerian operation in

15 Q1 2010: Gross Profit (reported) EURO (million) Q Q vs 2009 Net Sales Revenue 1, , % Cost of Sales (842.0) (860.9) -2% Gross Profit % Net sales revenue per unit case was up by 8 cents, 2% vs 2009 Cost of sales per unit case was flat vs 2009 Gross profit per unit case increased by 8 cents, 6% vs 2009 Gross profit margin increased to 38.9% from 37.4% (an increase of 150 bps versus last year) 15

16 Q1 2010: Opex per unit case (comparable) EURO Q Q vs 2009 Sales % Marketing % Warehouse / Distribution % Administration % Total operating expenses % Financial indicators presented on a comparable basis exclude the recognition of restructuring costs incurred in 2009 and the insurance payments received in 2009 in respect of damage sustained at our Nigerian operation in

17 Q1 2010: Net Profit (reported) EURO (million) Q Q vs 2009 Operating profit (EBIT) % Finance costs & other (16.8) (26.0) -35% Profit before tax >100% Tax (7.5) (4.3) 74% Minority interests (2.2) (4.6) -52% Net Profit >100% Earnings per Share (in euros) >100% 17

18 Q1 2010: Net Profit (comparable) EURO (million) Q Q vs 2009 Operating profit (EBIT) % Finance costs & other (16.8) (26.0) -35% Profit before tax >100% Tax (7.5) (4.6) 63% Minority interests (2.2) (3.4) -35% Net Profit >100% Earnings per Share (in euros) >100% Financial indicators presented on a comparable basis exclude the recognition of restructuring costs incurred in 2009 and the insurance payments received in 2009 in respect of damage sustained at our Nigerian operation in

19 Q1 2010: Free Cash Flow EURO (million) Q Q vs 2009 Adjusted EBITDA* Change in working capital** Tax paid (Gain)/ Loss on asset disp Cash Flow from operations Net capital expenditure 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. (**) Includes changes in inventory, trade and other receivables as well as trade and other payables 19

20 Thank you For further information on Coca-Cola Hellenic please visit our website at: or contact our Investor Relations team at