PRELIMINARY RESULTS rd February 2012

Transcription

1 23 rd February 2012

2 Nicandro Durante Chief Executive

3 Proven strategy continues to deliver

4 Superior shareholder returns Daily Relative performance to FTSE100 Price GBp 2,800 2,600 2,400 2,200 2,000 1,800 1,600 31/12/ /02/2012 (GMT) Value GBp ,400 1,200 1, BAT share price Relative performance to FTSE 100 Source: Reuters

5 Delivering the strategy Volume (rep) Volume (org) -0.4% -0.4% GDB volume 9% Revenue (rep) 3% Revenue (org, const) 7% Adjusted Profit (rep) Adjusted Profit (org, const) 11% 10% Operating margin (rep) Operating margin (org) +1.4 ppt +2.3 ppt Adj EPS DPS 11% 11%

6 Global drive brands GDB volumes Volume: 48 billion Share flat in T40 Strong growth in Brazil, Romania and GCC Innovations account for over 50% of volume S. Korea impacted by price increase Volume: 67 billion, up 10% Share +0.3 ppt in T40 Strong performance in Japan, Romania and eastern Europe Innovations driving growth GDB volume: 226 billion +9% International brands: 371 billion +4% Organic premium volume -0.1% Organic below-premium volume -0.5%

7 Global drive brands GDB volumes Volume: 30 billion, up 14% Share +0.2 ppt in T40 Growth in WE, South America Capsule markets driving growth Volume: 81 billion, up 11% Share +0.3 ppt in T40 Strong performance in Pakistan, Turkey and Russia Declines in Mexico and Spain GDB volume: 226 billion +9% International brands: 371 billion +4% Organic premium volume -0.1% Organic below-premium volume -0.5%

8 Volumes and revenues 20% 15% 10% 5% 0% 2% 10% 13% 7% 7% 6% 3% 3% 2% 2% 1% 0% 0% -5% -5% -3% -10% Asia Pacific Americas W. Europe EEMEA Group Volume (organic) 2% -5% 0% 1% 0% Revenue const) 10% 6% 3% 7% 7% Revenue (@ curr) 13% 2% -3% 2% 3%

9 Volumes and profit 20% 16% 17% 15% 10% 11% 11% 10% 12% 11% 10% 5% 0% 2% 4% 4% 0% 1% 0% -5% -5% -10% Asia Pacific Americas W. Europe EEMEA Group Volume (organic) 2% -5% 0% 1% 0% Profit const) 11% 4% 10% 17% 10% Profit (@ curr) 16% 4% 11% 12% 11%

10 Asia Pacific Strong profit growth due to Japan, South Asia and FX Industry volumes impacted in Australia Volume GDBs 2% 12% Japan: share and profit growth post earthquake Revenue 13% South Korea volumes and market share impacted following price increase Profit 16% Operating margin +0.8 ppt

11 Americas Revenue and profit driven by pricing, improved mix Volumes impacted by industry declines across the region Higher profit in Brazil, Mexico and Venezuela Protabaco acquisition completed Volume GDBs Revenue Profit -4% 2% 4% 9% Operating margin +1.0 ppt

12 Western Europe Profit improvement across the region Volume -1% Good Global Drive Brand performance GDBs 6% Spain affected by price war and economy Romania: reduced illicit trade and higher market share Revenue Profit -3% 11% Operating margin +4.2 ppt

13 Eastern Europe, Middle East and Africa Strong profit growth despite FX Volume 1% Strong performances in Russia, Nigeria and the Middle East Turkey impacted by excise and competitor pricing S. Africa: Strong performances by Peter Stuyvesant and Dunhill GDBs Revenue 2% 8% Good growth of Dunhill in the GCC region Profit 12% Operating margin +3.2 ppt

14 Ben Stevens Finance Director and Chief Information Officer

15 Operating margin 39.5% 40.5% 35.4% 36.2% 34.1% 32.9% 33.5% 35.8% 29.9% 29.7% Asia Pacific Americas W. Europe EEMEA Group * Based on adjusted profit

16 Productivity programme 35% margin target achieved 1 year early Targeting 50 to 100 basis points improvement a year Group operating margin % 30.7% 31.4% 33.5% 35.8%

17 Profit from operations adjusting items m % change Adjusted profit 5,519. 4, % Restructuring & integration costs Amortisation of trademarks Impairment of trademarks (193) (58) -) (311) (62) (44) Goodwill impairment (273) (249) Fox River (274) -) Profit from operations 4,721. 4, %

18 Profit before tax m % change Profit from operations 4,721. 4, % Net finance costs (460) (480) +4% Associates % Profit before tax 4,931. 4, %

19 Taxation and profit for the period m % change Profit before tax 4,931. 4, % Taxation (1,556) (1,248) -25% Profit for the period 3,375. 3, % Underlying tax rate was 31.2% (2010: 30.2%)

20 Non-controlling interests and adjusted EPS Profit attributable to m % change Owners of the parent 3,095. 2, % Non-controlling interests % Profit for the period 3,375. 3, % Adjusted profit after tax 3,857. 3,504. Number of shares 1,982m. 1,994 m. Adjusted EPS 194.6p p. +11%

21 Drivers of adjusted EPS growth EPS 2010 (p) Pence % Profit performance % Acquisitions / disposals Net finance costs (0.4) % 1% Associates % Taxation (3.0) -2% Non-controlling interests (1.1) -1% Share buy-back % Exchange % EPS 2011 (p) %

22 Cash flow m. m. Adjusted profit from operations 5,519. 4,984. Non cash items Increase in working capital (281) (61) Net capital expenditure (566) (523) Operating cash flow 5,187. 4,901. Net interest paid (469) (491) Tax paid (1,447) (1,178) Dividends paid to non-controlling interests (275) (234) Restructuring costs (217) (219) Dividends from associates Free cash flow 3,326. 3,240. Operating cash flow % of operating profit 94% 98% Free cash flow % of adjusted earnings 86% 92%

23 Cash flow m. m. Free cash flow 3,326. 3,240. Dividends paid to shareholders (2,358) (2,093) Share buy-back (755) -. Net investment activities (311) -. Other net flows (93) (77) Net cash flow (191) 1,070.

24 Net debt m m Opening net debt at 1 January (7,841) (8,842) Net cash flow for the period (191) 1,070) Exchange rate effects 123. (41) Net debt disposed Other (including change in accrued interest) (19) (39) Closing net debt at 31 December (7,928) (7,841)

25 Strategic targets exceeded or met Adjusted EPS 11% higher at 194.6p Proposed dividend per share 11% higher at pence Annual share buy-back programme increased to 1.25 bn Pricing, share and margin momentum continues into 2012

26 23 rd February 2012

27 SUPPLEMENTARY SLIDES Preliminary results 2011

28 Volumes by region FY 2011 Region Billions % change Asia Pacific % Americas % Western Europe % Eastern Europe, Middle East and Africa % Group %

29 Volumes by region H Region Billions % change Asia Pacific % Americas % Western Europe % Eastern Europe, Middle East and Africa % Group %

30 Volumes by region Q Region Billions % change Asia Pacific % Americas % Western Europe % Eastern Europe, Middle East and Africa % Group %

31 Revenue by region FY 2011 Region m % change Asia Pacific 4,251 3,759 13% Americas 3,558 3,498 2% Western Europe 3,600 3,695-3% Eastern Europe, Middle East and Africa 3,990 3,931 2% Group 15,399 14,883 3%

32 Revenue by region H Region m % change Asia Pacific 2,226 1,948 14% Americas 1,814 1,852-2% Western Europe 1,881 1,746 8% Eastern Europe, Middle East and Africa 2,040 2,039 0% Group 7,961 7,585 5%

33 Adjusted profit from operations FY 2011 Region m % change Asia Pacific 1,539 1,332 16% Americas 1,441 1,382 4% Western Europe 1,228 1,103 11% Eastern Europe, Middle East and Africa 1,311 1,167 12% Group 5,519 4,984 11%

34 Adjusted profit from operations H Region m % change Asia Pacific % Americas % Western Europe % Eastern Europe, Middle East and Africa % Group 2,759 2,524 9%

35 Top 40 market share movements (1) Market SOM FY11 (%) Movement (ppt) Market SOM FY11 (%) Movement (ppt) Argentina France Australiaº GCC Bangladesh Germany Belgium Greece Brazil Indonesia Canada Italy Chile Japan³ Colombia¹ Kazakhstan Denmark Malaysia Egypt² Mexico Based on retail audit ºAustralia Nov YTD ¹ Colombia excludes Protabaco acquisition (Octt2011) ² Egypt retail audit excludes the period of civil unrest Feb-Apr 2011, YTD Nov ³ Japan based on shipment share

36 Top 40 market share movements (2) Market SOM FY11 (%) Movement (ppt) Market SOM FY11 (%) Movement (ppt) Spain Netherlands Sweden New Zealand Switzerland Nigeria Taiwan Pakistan Turkey Poland UK Romania Ukraine Russia Uzbekistan South Africa Venezuela South Korea Vietnam Based on retail audit

37 Foreign currencies Average Closing US dollar Canadian dollar Euro South African rand Brazilian real Australian dollar Russian rouble Japanese yen