Becle, S.A.B. de C.V. Corporate Presentation

Transcription

1 Becle, S.A.B. de C.V. Corporate Presentation Nov 2017

2 A Leading Global Spirits Company and Undisputed Leader in Worldwide Created in 1758, Cuervo is today an 11 th generation managed, the only Latin American public spirits company Undisputed leader in tequila globally, ~0% market share (1) Comprehensive portfolio of over 0 brands in 9 categories Track record of innovation and value enhancing/strategic M&A Key Figures Combined Financial Statements 2016 Volume (9L cases) 20.4mm Net Sales P$24,96 MM EBITDA P$6,040 MM EBITDA Margin 24.8% Strong geographic diversification and relevant exposure to the U.S. and Canada, the world s largest profit pool Strong market position in high growth Irish Whiskey category with Bushmills Vertically integrated from production to distribution Net Sales Value Breakdown 2016A By Region Mexico ROW 25% 10% 65% U.S. and Canada By Category Non-Alcoholic & Other 22% RTDs 14% Non- 18% 46% Source: Company information and IWSR Notes: 1. Based on IWSR total volume as of

3 Extensive Portfolio of Leading Non- Brands Over 15 brands in non-tequila categories 8 brands in #1 / #2 position within their segment Irish & American Whiskey Rum Net Sales by Family / Category 2016A Total Ps$24,96 MM / Ultra Ultra Standard 2 7 Vodka Gin Mezcal Jose Cuervo Family (7%) Ultra Value Ultra 1800 Family (12%) Other (9%) 1 Bushmills (5%) RTD s Non-alcoholic Kraken (4%) Other Spirits (11%) Mid Price RTDs (8%) Non-Alcoholic & Other (14%) Source: Company information, IWSR Note: Company s portfolio includes other brands not displayed above

4 Untapped International Growth Key Categories Underpenetrated Outside Core Markets Cross-leverage Platforms to Accelerate Expansion As % of Total Spirits Retail Sales 2015 $.0 (1) $ % 90.2%.0% 9.8% $ % 0.9% ~US$450 MM Potential market revenue opportunity if penetration increases 1% Cuervo derived ~89% of its 2016 net sales in value from the U.S., Canada and Mexico ROW 11% U.S., Canada & Mexico 89% Other Spirits Total Spirits Retail Sales (US$ Bn) Irish Whiskey while Bushmills brand reported ~70% coming from ROW As % of Global Whisky Retail Sales 2015 $ % ~US$600 MM Potential market revenue opportunity if penetration increases 1% U.S., Canada & Mexico 0% ROW 70% 4.0% Irish Whiskey Other Whisky Global Whisky Retail Sales (US$ Bn) Source: IWSR, Company information Note: 1. Excludes Cane Marginal growth in the underlying markets represents a significant revenue potential for Cuervo 4

5 Right Brands / Right Categories / Right Markets U.S. Spirits Growth Volume CAGR Spirits Categories Global Market Share % Volume % 5.% 4.5%.% 0.% 2.5% Vodka 15.2% Irish Whiskey U.S. Whiskey (0.4%) (1.7%) Vodka Scotch Rum Gin Total Spirits Whiskey 0.2% Irish Whiskey 12.5% Global Spirits Growth Volume CAGR Brandy 6.1% 4.0% 9.8% Irish Whiskey 5.5% U.S. Whiskey.2% 1.% 1.1% 0.1% (0.%) Scotch Gin Rum Vodka Total Spirits (1) Rum 0.9% 4.5% & Irish Whiskey remain underrepresented categories within spirits Source: IWSR Notes: 1. Excludes Baiju 5

6 Fully Integrated Platform 1 Agriculture 2 Production Competitive Advantage Resulting from Appellation of Origin for Flagship Distilleries and Bottling Facilities Support Route-to-Market Strategy La Rojeña () Tamaulipas (11 Municipalities) Camichines () Nayarit (8 Municipalities) Guanajuato (7 Municipalities) EDISA Bottling facility Jalisco (bottling) Stranahan s (Colorado) Michoacan (0 Municipalities) Hangar 1 (California) can only be produced from Agave Azul (na Weber) Proximo Bottling (Indiana) Cuervo is the largest Agave Azul producer Critical element in our supply and quality control strategy Cuervo is involved in full Agave cycle (plant, grow, harvest and freight) Old Bushmills Distillery and Bottling (Northern Ireland) Source: Company Information 6

7 and Value-Enhancing M&A Value-Enhancing M&A Bushmills Irish Whiskey: a Milestone in our M&A Strategy Key Acquisition Criteria Value Creation Potential: #2 Irish whiskey in the U.S. by volume # Irish whiskey in the world by volume Category with Attractive Growth Profile: 17.9% CAGR in volume in the U.S. Brands: well known brands with broad portfolio offering Global Presence in Key Countries: 2015A figures (10 months) (1) Key Markets: 1) U.S. and Canada, 2) Eastern Europe, ) Western Europe, 4) UK/Ireland, 5) Global Duty Free Commercial Synergies Volume: Revenues: 579,071 9L Cases Ps$867 MM Source: Company information Notes: 1. From March to December 7

8 Our Company 1 Undisputed leader in tequila worldwide 2 Unique portfolio of iconic brands in key fast-growing spirit categories, built upon an innovation focus and value enhancing M&A Global spirits company with leading presence in most profitable spirits markets with significant upside potential 4 Integrated model with robust route-to-market strategy 5 Track record of profitable growth and resilient cash flow generation 6 Heritage built upon continued value creation and consistent family leadership 8

9 Q17 Financial Results 9

10 Q Profitability and growth summary (MXN) Volume (combined & consolidated entity) (000s of 9L cases) Net Sales (combined & consolidated entity) (PS$M) 4, % 4,704 4,67 +1, % 5,765 Act 2016 Act 2017 Act 2016 Act 2017 EBITDA & Margin (c & c entity) PSD$MM) Margin 28.5% 21.6% 1,20-77 (-5.9%) 1,24 Cash conversion rate (2) CAPEX (PS$ MM) % +0.5% 88% Act 2016 Act 2017 Act 2016 Act 2017 Source: Consolidated and combined financial statements. Notes: 1. EBITDA calculated as net income plus depreciation and amortization, income tax expense, interest expense, foreign exchange loss (gain) minus interest income 2. Calculated as (EBITDA-Capex)/EBITDA. 10

11 Q Financial statements summary MXN For the three months ended Sep Real Q 2016 Act Q 2017 Var (17-16) (PS$ MM) Abs % Abs % Abs % Net Sales 4,67 5,765 1, Cost of goods 1, , Gross profit 2, , Advertising, marketing & promotion , Distribution Selling and administrative Other (expenses) income, net (11) Operating profit 1, , (62) -5.2 Financial results, net (114) -2.0 (184) -26. Other non-recurring income (loss) NM Profit before tax 1, , Total income taxes Consolidated Net income EBITDA 1, , (77) -5.8 Source: Combined and consolidated financial statements Notes: 1. Includes differences in exchange rates arising from overseas operations 11

12 Q Financial Statements Summary Balance sheet Dec 1, 2016 Debt / Equity 21.8% Sep 0, 2017 (Ps$ MM) Cash and cash equivalents 5,128 18,677 Accounts receivable, net 6,96 4,726 Inventories, net 5,94 7,095 Other current assets(1) 2,258 2,951 Total Current Assets 19,725,449 Non-current inventories,178,548 Property, plant and equipment, net 4,641 4,486 Intangible assets and trademarks, net 11,771 10,755 Goodwill 5,992 5,699 Other assets(2) Total Assets 45,687 58,24 Dec 1, 2016 Sep 0, 2017 (Ps$ MM) Current installment of notes payable to Banks 5 12 Trade accounts payable 2,407 1,829 Accruals 1,708 1,954 Other liabilities() Total current liabilities 4,456 4,211 Long term debt, excluding current interest payable 10,207 8,998 Other long-term liabilities Environmental reserve Deferred income taxes 2,759 2,581 Total Liabilities 17,65 16,009 Total controlling interest 28,022 42,285 Non-controlling interest 0 0 Total Stockholders' Equity 28,052 42,15 Total Liabilities and Stockholders Equity 45,687 58,24 12

13 Q Financial Statements Summary Cash Flow As of Sep (Ps$ MM) Income before income taxes,642,60 Items relating to investing activities Items relating to financing activities Changes in working capital (2,60) (2,117) Net cash provided by operating activities 1,572 1,751 Net cash provided by investing activities (457) (15) Net cash provided by financing activities (1,17) 1,90 Net increase in cash and cash equivalents (59) 14,826 Translation effect in cash and cash equivalents 1,411 (1,278) Net increase in cash and cash equivalents 1,52 1,548 Cash and cash equivalents at beginning of period 4,19 5,128 Cash and cash equivalents at end of period 5,491 18,