Fevertree Drinks plc. Preliminary Results. Year ended 31 December 2014

Transcription

1 Fevertree Drinks plc Preliminary Results Year ended 31 December 2014 Tim Warrillow, Co-founder and CEO Andrew Branchflower, Finance Director

2 Introduction to Fever-Tree Launched by Charles Rolls and Tim Warrillow in 2005 Simple premise: A significant and long term growth in premium spirits Not matched by any premium offering in mixers category Fever-Tree was launched at ideal moment to provide a quality mixer range to fill the vacuum The world s leading premium mixer brand with 80 million bottles sold in 2014 Now in 50 countries worldwide, with 68% of sales overseas Fever-Tree is burning up our charts, dominating its category like no other brand in any other sector Drinks International 2015 Brands Report 1

3 Key Strengths Market leading brand with international reach First mover advantage Leading premium mixer brand around the world Clearly differentiated premium product Proven business model and management team Ingredients, taste, packaging and story Acclaimed product proposition Scalable outsourced business model Strong founder-led management team The World s Best Tonic Robert Parker Significant growth opportunities Global mixer market in early stages of premiumisation Potential addressable market of approx 1.6bn RSV (EY, 2014) Growth underpinned by strong margins throughout value chain Higher cash and % margin for the trade and spirits partners My tonic is Fever-Tree Ferran Adria 2

4 Financial highlights A successful year of growth underpinned by strong steady margins and cash flow conversion m FY14 FY13 Growth Revenue % Gross profit % Gross margin 50.9% 51.0% EBITDA* % EBITDA margin 28.8% 28.9% EBITDA Gross Operating cash flow conversion of 73% of EBITDA (2013: 75%) Strong balance sheet with net cash at year end of 3.3m Final dividend of 0.30 pence per share recommended to shareholders Progressive dividend policy *Pre-exceptional items *defined as Operating Cash flow / EBITDA 37

5 Review of the year Regional review (i) Our global sales are across four regions: the UK, USA, Continental Europe and Rest of the World UK is the Group s largest single country, representing 32% of sales 68% of sales generated overseas reflecting Fever-Tree s international appeal Diverse customer base with no single customer accounting for >5% of sales 2014 Revenue by Region Historic Revenue by Region UK 4

6 Review of the year Regional review (ii) UK Largest country, 32% of total sales Growth of 60% Strong rate of sale growth in all three major retail customers (Waitrose, Sainsbury s and Tesco) plus significant distribution increase at Tesco Strong growth in the On-Trade where 60% of revenue is generated USA Second largest country, 24% of total sales Growth of 59% with a strong finish to the year Significant new national listings in both On and Off- Trade Ginger Beer sales up 91% driven by the growing popularity of Moscow Mule cocktail and represent over 33% of all US sales 5

7 Review of the year Regional review (iii) Continental Europe 39% of total sales made across 25 countries Growth of 35% across region Continued impressive sales growth in Belgium Gin and Tonic renaissance sweeping across Western Europe, with strong sales across Italy, Germany, Holland and Switzerland. RoW 23 countries representing 5% of total sales Main countries are Canada, Australia and Colombia 8 new countries added in

8 Financial review Income Statement (i) Revenue of 34.7m Growth of 49% on 2013 Gross profit margin of 50.9% Margin maintained despite weakening of Euro and US Dollar in 2014 EBITDA of 10m at a margin of 28.8% Underlying operating expenses consistent with 2013 at 22.1% of revenue m FY14 FY13* Growth Revenue % Gross profit % Gross margin 50.9% 51.0% EBITDA** % EBITDA margin 28.8% 28.9% *Fevertree Drinks plc was incorporated in February 2013 and acquired the trading entity Fevertree Limited in March As such, the audited financial statements will present a 10 month period for the 2013 comparison. To allow meaningful comparisons to be made this presentation refers to the full year s trading for 2013 as the comparison period, therefore including trading by Fevertree Limited in the 2 month period prior to its acquisition by Fevertree Drinks plc. **Pre-exceptional items 7

9 Financial review Income Statement (ii) Exceptional costs 2014 costs were fees associated with the IPO 2013 costs related to the LDC investment Finance expenses These include 5.1m of interest and arrangement fees relating to the investor loan notes which will be non-recurring Tax Should revert to statutory levels in future years EPS and dividend Normalised EPS of 6.46 pence in FY14 Proposed dividend of 0.30 pence per share in respect of the period from IPO to year end m FY14 FY13 EBITDA* Depreciation (0.1) <(0.1) Amortisation (0.7) (0.6) Exceptional costs (1.1) (3.1) Operating profit Finance expenses (5.6) (4.1) Profit before Tax 2.5 (1.1) Tax (1.2) (1.0) Profit after Tax 1.3 (2.1) EPS (pence) 1.54 (3.26) *Pre-exceptional items 8

10 Financial review Cash flow Operating Cash flow Working capital increased in line with revenue On-going cash flow Sub-heading included here to strip out the on-going cash flows from those relating to exceptional costs, IPO fund raise and the pre- IPO structure m FY14 FY13 EBITDA* Working Capital movement (2.7) (1.7) Operating Cash flow Conversion 73% 75% Tax (1.2) (0.9) Capital expenditure (0.3) (0.2) Bank loan interest and repayment (0.7) (0.5) On-going Cash flow Exceptional costs (1.1) (3.2) Loan note interest (1.1) (1.2) IPO Primary raise Other investing activities (50.0) (50.5) Other financing activities Net Cash flow 6.3 (0.8) *Pre-exceptional items 9

11 Financial review Balance sheet net assets Net cash of 3.3m Cash of 9.6m offset by 6.3m of gross debt Net asset movement Conversion of investor loan notes to equity pre-ipo m FY14 FY13 PPE Intangibles Stock Receivables Derivatives <0.1 <0.1 Cash Creditors and provisions (5.0) (3.7) Gross debt (6.3) (52.5) Deferred tax (2.7) (2.7) Net Assets 53.3 (1.5) 10

12 Strategic opportunities for 2015 Capitalising on market trends Global premiumisation trend Drinks trends; Mixability, G&T, Moscow Mule etc Strengthening distribution in existing markets Deepening distribution Increased support On-going review of international distribution partners Expanding distribution into new markets 50 territories worldwide, 35 of these are at very early stages Currently assessing growth opportunities in LatAm and Asia Pacific New product development Naturally light portfolio Territory-specific flavours and formats Packaging refresh 11

13 Summary and Outlook Excellent progress achieved during 2014 translated into strong revenue and profit growth Strong premiumisation and drinks trends in Company s favour Our first mover advantage as the leading international premium mixer brand continues to present significant growth opportunities in both existing markets and through new geographies and products Board confident in outlook for 2015 and beyond 12