Bryggerigruppen A/S (The Danish Brewery Group A/S) Q3 2004

Transcription

1 Bryggerigruppen A/S (The Danish Brewery Group A/S) Q

2 Agenda Introduction to The Danish Brewery Group Strategic perspectives Q3 Results Shareholder information 2

3 Introduction to The Danish Brewery Group OVERVIEW The Company Second largest brewery business in Scandinavia Scandinavia s leading beer exporter Approx. 1,900 employees More than 13,000 shareholders The only brewery business in Scandinavia to be EMASregistered (EU s environmental regulation) Its Products Ceres i a leading brand in Italy (85% market share in the segment) Royal Export is the preferred strong beer in Denmark Faxe is the leading import brand in Germany, Poland, and Lithuania Faxe Kondi is the number 2 soft drink in Denmark Vitamalt is the number 3 malt drinks brand in the world 12% Revenue distribution Q 40% 8% Denmark Western Europe Eastern Europe Others 40% 3

4 Introduction to The Danish Brewery Group VISION AND BUSINESS FOCUS Vision We will with increasing profitability create a business as one of the leading providers of beverages in the Nordic and Baltic countries, and we will develop profitable export markets. Business Focus Nordic and Baltic countries: Domestic market Italy and Germany: Niche strategy The Caribbean and Africa: Niche strategy (malt) 4

5 Strategic perspectives FINANCIAL TARGETS i Return on invested capital - ROIC An increase from 8.8% in 2002 to more than 10% in 2004 i Cash flow Generating a cash flow of more than DKK 200 million after tax per year i Profit margin An increase from 9.1% in 2002 to more than 10% in

6 Introduction to The Danish Brewery Group HISTORY Ceres Bryggerierne Faxe Jyske A/S Bryggerigruppen A/S (change of name) Merger with holding companies (direct stock exchange listing) Acquisition of Tauras, Lithuania Acquisition of Kalnapilis, Lithuania Albani and the Group merge Scandinavian alliance created Cooperation with Heineken V8 V8 Next Acquisition of Cido, Latvia Acquisition of Lacplesa Alus, Latvia 6

7 Introduction to The Danish Brewery Group THE GROUP Breweries of The Danish Brewery Group Albani Bryggerierne, Odense Ceres Bryggerierne, Århus Faxe Bryggeri, Faxe Maribo Bryghus A/S, Maribo AB Vilniaus Tauras, Lithuania AB Kalnapilis, Lithuania SIA Cido Partikas Grupa, Latvia (Lacplesa Alus A/S, Latvia) Associates Banjul Breweries Limited, Gambia Hansa Borg Skandinavisk Holding A/S, Faxe Nuuk Imeq A/S, Greenland Solomon Breweries Limited, Solomon Islands St.Vincent Breweries Ltd., The Caribbean Subsidiaries and Sales Companies Aktieselskabet Cerekem International LTD., Faxe Albani Sverige AB, Sweden Brewery Group Denmark AB, Sweden Centre Nordique d'alimentation EURL, France Ceres S.p.A., Italy Danish Interbrew LTD. A/S, Faxe Drinktech Holding AG, Switzerland Faxe Getränke-Vertrieb GmbH, Germany Faxe Kondi A/S, Faxe Faxe Polska Sp. z o. o., Poland Faxe Vandindvinding I/S, Faxe Impec Holding S.A.S, The Caribbean Peva Poland Sp. z o.o., Poland Supermalt UK Ltd., England The Danish Brewery Group Inc., USA Vitamalt West Africa Ltd, UK

8 Introduction to The Danish Brewery Group GROUP STRUCTURE LATVIA NORWAY DENMARK LACPLESA ALUS A/S SIA CIDO PARTIKAS GRUPA LITHUANIA CERES BRYGGERIERNE HANSA BORG BRYGGERIER ASA AB KALNAPILIS ALBANI BRYGGERIERNE FAXE BRYGGERI MARIBO BRYGHUS AB VILNIAUS TAURAS 8

9 Introduction to The Danish Brewery Group PREMIER LEAGUE AND FIRST DIVISION Canada England Germany France Nordic countries Baltic countries Poland Italy The Caribbean Africa Premier league First division 9

10 Strategic perspectives GOVERNANCE MODEL OF THE DANISH BREWERY GROUP Mission Management Philosophy Basic Values Vision Concretisation Overall Time Perspective Long Objectives Strategic and Action Plan Detailed Short Budget KPI 10

11 Strategic perspectives STRATEGIC PLAN V8 STATUS Royal: A new strong national beer 2. Introduction of Heineken in Denmark 3. Closure of brewery in Randers 4. More marketing power 5. Increased focus on product development and innovation 6. Increased focus on staff development 7. Resource optimisation 8. Increased focus on key markets 20% of segment 1% market share Completed In progress In progress In progress In progress Focus on marketing

12 Strategic perspectives V8 NEXT UPDATE OF THE STRATEGIC PLAN IN The Royal brand to be further strengthened 2. Cooperation with Heineken to be expanded 3. Relaunch of Kalnapilis in Lithuania Continued strong focus on value creation and profitability 4. More marketing power 5. Increased focus on product development and innovation 6. Increased focus on staff development 7. Resource optimisation 8. Increased focus on key markets

13 Strategic Perspectives WHAT IS NEW IN V8 NEXT? Expansion of the Royal-brand Objective: At least 10% market share of the Danish lager segment within 5 years Licence production of Heineken in Denmark Objective: Costs efficiency Relaunch of Kalnapilis (Lithuania) Objective: To recapture the position as the market leading supplier The other strategic elements to be maintained 13

14 Strategic perspectives V8 SUPPORTS THE TOTAL VALUE CHAIN Increased focus on product development, innovation, and more power on marketing Closure of brewery in Randers Royal Heineken Purchase Production Distribution Sales Resource optimisation Staff development 14

15 Results HIGHLIGHTS - Q i Consolidated profit before tax of DKK million (compared to DKK million for the same period of 2003) i Net revenue up by 6.8% to DKK 2,145.5 million i Q1-Q3 characterised by: 4Considerable marketing expenses relating to strategic initiatives under the V8 Next Plan 4Bad summer weather i large parts of Europe 4Increased competition and pressure on prices in Northern Europe i Increasing market shares in Italy, Denmark and Lithuania i EBIT of DKK million compared to DKK million in i Free cash flow amounting to DKK million compared to DKK million for the same period of 2003 primarily due to increased packaging investment. i Unchanged expectations for the full year, i.e. profit before tax in the amount of DKK million Sales 3.5 million HL (+13.6%) Net revenue DKK 2.1 billion (+6.8%) Operating profit DKK million (-6.2%) EBITDA DKK million (+15.5%) EBIT DKK million (+15.2%) Profit before tax DKK million (+11.3%) Free cash flow DKK million (-48.1%)

16 Results KEY EVENTS - Q i V8 Next Strategic Plan introduced - Royal wins market share - Heineken shows growth - Kalnapilis relaunched - Enhanced marketing efforts in key markets - Resource optimisation programme shows results - Changes in distribution system implemented i Intensified competition and price pressure in Northern Europe

17 Results KEY EVENTS - Q idenmark: - Beer segment wins market shares (Royal Pilsner and Classic, COOP) - Soft drinks: Faxe Kondi and Mirinda win market shares i Italy: Increasing market share in a falling total market i Lithuania: - Kalnapilis in progress. Total market share (Kalnapilis and Tauras) of 27% - Performance is developing positively i Latvia: - Cido leading Baltic soft drinks producer acquired - Entered into an agreement re. purchase of 83.5% of the share capital of the Latvian brewery Lacplesa Alus

18 Results Q DKK million % change Net revenue Operating profit EBIT Net financials Profit before tax Net profit 2, , Profit margin Free cash flow 9.5% %

19 Results FINANCIAL DEVELOPMENT - Q3, Net turnover Profit Margin DKK Million Percent Free cash flow 300 DKK Million

20 Results COMPONENTS OF REVENUE GROWTH - Q % 3% DKK Million % % mth 2003 Germany The Caribbean Export Impec Latvia 9mth 2004

21 Results VOLUMES (BY GEOGRAPHICAL AREA) - Q HL Q Q % change Q Q % change Western Europe ,607 2, Eastern Europe Other markets Total volumes 1,484 1, ,549 3,

22 Results NET TURNOVER Q Tax Free 1% The Caribbean 3% Eastern Europe 9% UK 2% Others 5% Denmark, beer 18% The Caribbean 4% Eastern Europe 9% UK 2% Tax Free 2% Others 5% Denmark, beer 18% Germany 11% Denmark, soft drinks 25% Germany 12% Denmark, soft drinks 24% Italy 26% Italy 24% 22

23 Results Volumes - Q Tax Free 2% The Caribbean 3% Others 6% Denmark, beer 20% Tax Free 2% The Caribbean 3% Others 5% Denmark, beer 20% Eastern Europe 16% Eastern Europe 22% UK 2% Denmark, soft drinks 21% UK 1% Denmark, soft drinks 18% Germany 18% Italy 12% Germany 18% Italy 11% 23

24 Results PEER GROUP - FINANCIAL PERFORMANCE 2003 Percent Cash conversion ratio Top 5 BG international breweries Percent Profit margin Top 5 BG international breweries Percent ROIC Top 5 BG international breweries 24

25 Results SHAREHOLDERS AND SHARE MARKET Shareholder mix % 10% (DKK per share) 2% 9% Dividend End-of-year price Dividend yield (%) % % % % % 24% 7% 6% 6% (DKK million) 5% Total dividend 49 Acquisition treasury shares *) 64 Total to shareholders 113 ) Period until the Annual General Meeting in April % Danske Bank LD ATP Fidelity PFA Other Danish Institutional Other foreign inv. Danish retail Employees Not registered 25

26 Shareholder Information PRICE DEVELOPMENT AND REVENUE to Thousand shares ( to ) Bryggerigruppen BRYGGERIGRUPPEN PEERS KFX (DK) Volume (Thousands) Peer Group comprising Carlsberg, Heineken Scottish & Newcastle, SABMiller and Interbrew. 26

27 Disclosure STATEMENTS ABOUT THE FUTURE The statements about the future made in the Q3 Report 2004 reflect Management s expectations in respect of future events and financial results, as well as of economic trends in key markets and developments in international money, foreign exchange and interest rate markets. Statements about the future will inherently involve uncertainty as they may be influenced by - in addition to global economic conditions - e.g. market driven price reductions, market acceptance of new products, unforeseen termination of business relationships, changes in regulatory aspects (duties, environment, packaging and containers). 27

28 Bryggerigruppen A/S (The Danish Brewery Group A/S) Faxe Allé 1 DK-4640 Fakse Denmark Telephone: Facsimile: Home page: Executive Board: Poul Møller Connie Astrup-Larsen Povl Friis Leif Rasmussen Ulrik Sørensen investorrelations@bryggerigruppen.dk CEO International Director Eastern and Central Europe Technical Director Sales and Marketing Director CFO 28

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