Royal Unibrew A/S by Lars Jensen, CFO 24 May 216 - Norwegian Clients Reversed Roadshow, Nordea 1 ROYAL UNIBREW NORDEA - NORWEGIAN CLIENTS REVERSED ROADSHOW 24 MAY 216
Performance improvement - in line with expectations Maintained market positions Volume increase of 1% to 2.1mHL Net revenue increase of 5% to DKK 1.4bn EBIT increase of 5% to DKK 138m Unchanged EBIT-margin of 1.2% Free cash flow up DKK 127m to DKK 5m on additional Aarhus sale Maintained outlook for 216 2 ROYAL UNIBREW NORDEA - NORWEGIAN CLIENTS REVERSED ROADSHOW 24 MAY 216
Increasing first quarter activity and results VOLUME HL () Change 9.6% EBITDA - MDKK Margin 15.8% 15.7% 1.899 182 2.81 8 24 212 1Q15 Change 1Q16 1Q15 Change 1Q16 NET REVENUE - MDKK Change 4.7% EBIT - MDKK Margin 1.2% 1.2% 6 1.29 1.35 131 7 138 1Q15 Change 1Q16 1Q15 Change 1Q16 3 ROYAL UNIBREW NORDEA - NORWEGIAN CLIENTS REVERSED ROADSHOW 24 MAY 216
Western Europe revenue & earnings growth as expected VOLUME HL D&G IT 1. 747 791 84 8 6 4 +5.8% +1.7% 2 6 4 2 1Q14 1Q15 1Q16 REVENUE mdkk D&G IT 562 593 622 8 +5.6% +4.9% 1Q14 1Q15 1Q16 Denmark and Germany - improved market position Consumer preferences continued shift towards branded products. Increasing consumer interest in craft beer Significant innovations and partnerships extension of organic beer range and craft beer brands with strong references to our local beer history Launch of distribution of PepsiCo snacks in Denmark as planned Italy - overall beer consumption unchanged Market position maintained EBIT mdkk 1 8 6 4 2 WE Margin 14.% 14.2% 11.6% 83 88 65 1Q14 1Q15 1Q16 4 ROYAL UNIBREW NORDEA - NORWEGIAN CLIENTS REVERSED ROADSHOW 24 MAY 216
Baltic Sea revenue & earnings growth as expected VOLUME HL Finland Baltic 1.2 9 6 3 933 956 1,17 +2.6% +15.8% 1Q14 1Q15 1Q16 REVENUE mdkk Finland Baltic 8 6 598 593 61 4 2 -.8% +2.9% 1Q14 1Q15 1Q16 EBIT mdkk Baltic Sea Margin 4 6.% 6.% 2 36 37 1Q14-2 -32 1Q15 1Q16-4 -5.4% Finland overall consumption declining and deflationary environment Continued low consumer confidence - unfavorable macro-economics Special beer campaign - volume increase and NR/HL dilution Market positions unchanged (excl. beer campaign) Commercial agenda focus on relationship with the trade, in-store execution and innovations Continuous efficiency improvements Baltic - market position maintained Declining consumption - excise increases and can deposit in Lithuania Launch of co-operation with PepsiCo - production, sale and distribution of PepsiCo soft drinks as planned 5 ROYAL UNIBREW NORDEA - NORWEGIAN CLIENTS REVERSED ROADSHOW 24 MAY 216
Malt Beverages & Exports revenue and earnings growth as expected VOLUME HL 2 15 1 5 167 17 152-9.3% +11.5% 1Q14 1Q15 1Q16 REVENUE mdkk 12 9 17 14 118 6 3-2.4% +13.5% 1Q14 1Q15 1Q16 EBIT mdkk 3 EBIT Margin 21.4% 2.6% 16.5% 2 22 24 18 1 Continued solid growth - broad based Some inventory build up at customer level Developing countries challenged by low commodity and energy prices: Macroeconomics negative impact Hard currency restricted accessibility Purchasing power FX depreciation Increased penetration solid revenue growth in spite of challenges Deeper penetration leverage on existing markets and distributors Marketing and organizational investment continues as planned. Focus on brand building and positions 1Q14 1Q15 1Q16 6 ROYAL UNIBREW NORDEA - NORWEGIAN CLIENTS REVERSED ROADSHOW 24 MAY 216
Improved financial performance mdkk 1Q 216 1Q 215 Change FY 215 P&L ITEMS: Net revenue 1,35 1,29 6 6,32 Gross margin 5.9% 51.% -.1 pp 52.6% EBIT 138 131 7 917 EBIT margin 1.2% 1.2%. pp 15.2% Profit before tax 127 119 8 92 Consolidated profit 99 92 7 711 BALANCE SHEET ITEMS: Net interest bearing debt 1,269 1,71-441 1,184 Net working capital -731-555 -176-99 Total assets 6,56 6,768-262 6,748 Equity 2,945 2,9 45 2,935 Equity ratio 45.3% 42.9% 2.4 pp 43.5% 7 ROYAL UNIBREW NORDEA - NORWEGIAN CLIENTS REVERSED ROADSHOW 24 MAY 216
Free cash flow improvement on additional sale of Aarhus CASH FLOW MDKK 1Q15: 24-36 168-255 -35-122 212-52 16 5 EBITDA Interest, tax, dividend received, other non-cash items Cash from operations before changes in NWC Changes in NWC Net Capex Free cash flow -272 117 8 ROYAL UNIBREW NORDEA - NORWEGIAN CLIENTS REVERSED ROADSHOW 24 MAY 216
Outlook 216 mdkk Outlook 216 Realized 215 Realized 214 Net revenue 6,15 6,4 6,32 6,56 EBITDA 1,19 1,29 1,225 1,13 *) EBIT 885 985 917 826 *) *) Incl. 5 mdkk one-time restructuring costs 9 ROYAL UNIBREW NORDEA - NORWEGIAN CLIENTS REVERSED ROADSHOW 24 MAY 216
Q&A DISCLAIMER: This announcement contains forward-looking statements. Undue reliance should not be placed on forward-looking statements because they relate to and depend on circumstances that may or may not occur in the future and actual results may differ materially from those in forward-looking statements. Forward-looking statements include, without limitation, statements regarding our business, financial circumstances, strategy, results of operations, financing and other plans, objectives, assumptions, expectations, prospects, beliefs and other future events and prospects. We 1 ROYAL UNIBREW NORDEA - NORWEGIAN undertake no obligation, CLIENTS and REVERSED do not intend ROADSHOW to publicly update 24 MAY or revise 216 any of these forward-looking statements, unless prescribed by law or by stock exchange regulations.
Appendix 11 ROYAL UNIBREW NORDEA - NORWEGIAN CLIENTS REVERSED ROADSHOW 24 MAY 216
Facts about Royal Unibrew Royal Unibrew is the second biggest brewer in the Nordic and Baltic region Revenue in 215 of DKK 6.32 billion EBITDA in 215 of DKK 1,225 million Approximately 2,3 employees worldwide Export to approx. 85 countries worldwide 5 breweries and 2 soft drink/water facilities Market Cap end December 215 of DKK 15.5 billion or EUR 2. billion Daily average liquidity L12 months approx. DKK 25 million or EUR 3.4 million 12 ROYAL UNIBREW NORDEA - NORWEGIAN CLIENTS REVERSED ROADSHOW 24 MAY 216
A Leading Regional Beverage Group Royal Unibrew Core markets Full range of beverages, own breweries and distribution Denmark Germany Finland Lithuania Latvia Estonia Niche markets Specialty beverages, export markets, third party distribution Italy Markets for malt beverages and export of beer: Caribbean, Africa, South America, major metropolitan areas in England and USA Associated companies, other assets Other assets Norway: Hansa Borg Breweries 25% Greenland: Nuuk Imeq A/S 32% Remaining parts of Aarhus brewery site Royal Unibrew is a leading regional beverage group 13 ROYAL UNIBREW NORDEA - NORWEGIAN CLIENTS REVERSED ROADSHOW 24 MAY 216
Hartwall 213 acquisition takes Royal Unibrew to a new level 5 million more consumers Net revenue EBITDA 7 DKK billion 14 DKK million 6 12 5 1 4 2,3 8 373 3 2 3,3 5,6 6, 6 4 65 978 1225 1 2 14 ROYAL UNIBREW NORDEA - NORWEGIAN CLIENTS REVERSED ROADSHOW 24 MAY 216
Royal Unibrew s goal is to be an efficient regional beverage player Positions, mainstream and niche Category, brands and international partnerships Growth agenda Commercial agenda Efficiency agenda Financial, competitive and strategic flexibility and capital structure Our Leadership DNA 15 ROYAL UNIBREW NORDEA - NORWEGIAN CLIENTS REVERSED ROADSHOW 24 MAY 216
Solid performance to peers 215 EBIT MARGIN (COMPARABLE REGION)* % 215 214 213 18 15 12 9 6 3 FREE CASH FLOW % OF REVENUE % 215 214 213 18 15 12 9 6 3 RU Peer 1 Peer 2 Peer 3 RU Peer 1 Peer 2 Peer 3 RETURN ON INVESTED CAPITAL** CASH RETURN TO SHAREHOLDERS % 215 214 213 % 215 214 213 18 12 15 12 9 6 1 8 6 4 3 RU Peer 1 Peer 2 Peer 3 * Based on FY213 and FY214 results on comparable basis. RU proforma 213 EBIT margin 12,% ** Based on average invested capital vs. previously on year end figures 2, RU Peer 1 Peer 2 Peer 3 16 ROYAL UNIBREW NORDEA - NORWEGIAN CLIENTS REVERSED ROADSHOW 24 MAY 216
Financial targets November 215 revised target August 214 revised target Post Hartwall acquisition target** Pre Hartwall acquisition target* EARNINGS EBIT margin 15% EBIT margin 14% EBIT margin 13% EBIT margin 14% EQUITY RATIO Minimum 3% Minimum 3% Minimum 3% Minimum 3% NIBD/EBITDA Maximum 2.5x Maximum 2.5x Maximum 2.5x Maximum 2.5x Dividends and share buy-backs resumed in 215 Distribution policy: Dividends 4-6% of net result Share buy-back to adjust capital structure * Basically no amortization ** Amortization from the acquisition decreased EBIT-margin by approx. 5bp 17 ROYAL UNIBREW NORDEA - NORWEGIAN CLIENTS REVERSED ROADSHOW 24 MAY 216
Financial Performance 28-215 Net revenue EBIT DKKm 6. DKKm 9 5. 7 4. 5 3 3. 1 2. -1 28 29 21 211 212 213* 214 215 1. -3 28 29 21 211 212 213 214 215-5 * Hartwall contribution DKK 38m 18 ROYAL UNIBREW NORDEA - NORWEGIAN CLIENTS REVERSED ROADSHOW 24 MAY 216
Financial Performance 28-215 OPERATING IMPROVEMENTS AND SALE OF NON-CORE ASSETS CREATING SHAREHOLDER VALUE x 8 NIBD/EBITDA % 5 EQUITY RATIO DKKm 7 DISTRIBUTION Buy-back Dividends 6 4 4 3 6 5 4 2 3 2 1 2 1 28 29 21 211 212 213* 214 215 28 29 21 211 212 213 214 215 29 21 211 212 213 214 215 * Calculated pro forma with Hartwall s realized full-year EBITDA 19 ROYAL UNIBREW NORDEA - NORWEGIAN CLIENTS REVERSED ROADSHOW 24 MAY 216
Significant organic improvement from 212 to 215 in all segments EBIT growth of 89% Net revenue bridge 212-215 mdkk 7. 6. 5. 4. 3. 3.43 Net revenue 212-1 Not allocated & divestment 2.356 298-89 137 Acq. HW, proforma FY 213 WE organic Baltic Sea organic Malt & Export organic 6.32 Net revenue 215 mdkk EBIT bridge 212-215 1.1 9 7 5 485-5 28 85 12 23 917 3 EBIT 212 Not allocated & divestment Acq. HW, proforma FY 213 WE organic Baltic Sea organic Malt & Export organic EBIT 215 2 ROYAL UNIBREW NORDEA - NORWEGIAN CLIENTS REVERSED ROADSHOW 24 MAY 216
Shareholder Structure Largest shareholders Chr. Augustinus Fabrikker A/S 1.4% (notified 11 December 29) Hartwall Capital Oy Ab 7.1% (notified 6 May 215) BlackRock Investment Management (UK) Limited 5,4% (notified 26 April 216) Approx 15, shareholders in total One share class No restrictions in ability to pay dividend or buy back shares 21 ROYAL UNIBREW NORDEA - NORWEGIAN CLIENTS REVERSED ROADSHOW 24 MAY 216
Hartwall transaction rationale growing the earnings base (pro forma 213 and 212 figures) 213 212 DKKm Royal Unibrew Hartwall* Combined Royal Unibrew ** Hartwall Combined Volume, HL m 5.4 3. 8.4 5.4 3. 8.4 Revenue 3,694 2,356 6,5 3,33 2,32 5,632 EBITDA 638 377 1,15 65 373 978 EBIT 522 28 73 48 29 689 EBITDA margin, % 17.3 16. 16.8 18.2 16.2 17.4 EBIT margin, % 14.1 8.8 12. 14.4 9.1 (11.7***) 12.1 Employees 1,643 825 2,468 1,635 862 2,497 * Hartwall realized full year 213 before deduction of DKK 15m in transaction costs ** Excluding Impec *** EBIT-margin including estimated amortization derived from the acquisition Unique chance to create a stronger and more diversified business platform Larger and broader earnings base and expansion of portfolio of own brands 22 ROYAL UNIBREW NORDEA - NORWEGIAN CLIENTS REVERSED ROADSHOW 24 MAY 216
213 Hartwall acquisition EV of DKK 3.3 billion Paid to Heineken for 1% of the shares in Hartwall DKK 2.8 billion NIBD in Hartwall DKK -19 million Difference from EV is cash payment to Heineken Factoring for accounts receivables Various regulations agreed with Heineken Consolidation as of 23 August 213 23 ROYAL UNIBREW NORDEA - NORWEGIAN CLIENTS REVERSED ROADSHOW 24 MAY 216