Forward-looking statements 2 Unless otherwise indicated, the condensed consolidated financial statements and the financial and operating data or other information included herein relate to Coca-Cola HBC AG and its subsidiaries ( Coca-Cola HBC or the Company or we or the Group ). This document contains forward-looking statements that involve risks and uncertainties. These statements may generally, but not always, be identified by the use of words such as believe, outlook, guidance, intend, expect, anticipate, plan, target and similar expressions to identify forward-looking statements. All statements other than statements of historical facts, including, among others, statements regarding our future financial position and results, our outlook for 2014 and future years, business strategy and the effects of the global economic slowdown, the impact of the sovereign debt crisis, currency volatility, our recent acquisitions, and restructuring initiatives on our business and financial condition, our future dealings with The Coca-Cola Company, budgets, projected levels of consumption and production, projected raw material and other costs, estimates of capital expenditure, free cash flow, effective tax rates and plans and objectives of management for future operations, are forward-looking statements. You should not place undue reliance on such forwardlooking statements. By their nature, forward-looking statements involve risk and uncertainty because they reflect our current expectations and assumptions as to future events and circumstances that may not prove accurate. Our actual results and events could differ materially from those anticipated in the forward-looking statements for many reasons, including the risks described in the U.K. Annual Financial Report for Coca-Cola HBC AG and its subsidiaries for the year ended 31 December 2013. Although we believe that, as of the date of this document, the expectations reflected in the forward-looking statements are reasonable, we cannot assure you that our future results, level of activity, performance or achievements will meet these expectations. Moreover, neither we, nor our directors, employees, advisors nor any other person assumes responsibility for the accuracy and completeness of the forward-looking statements. After the date of the condensed consolidated financial statements included in this document, unless we are required by law or the rules of the UK Financial Conduct Authority to update these forward-looking statements, we will not necessarily update any of these forward-looking statements to conform them either to actual results or to changes in our expectations.
Third quarter highlights Good market share gains Volume declined in the quarter at a faster pace than in the first half unseasonably poor weather in Established markets our strategic decision to focus on sustainable value-accretive volume in Developing markets Increase in currency-neutral revenue per case for the 13th consecutive quarter OPEX as per cent of NSR improved by 30bps Good comparable EBIT margin improvement, leading to expansion for the nine months Solid free cash flow generation, with continued reduction in working capital balance 3
Financial review Michalis Imellos - CFO
Financial performance overview Q3 14 Q3 13 Ch. 9M 14 9M 13 Ch. Volume (m u.c.) 548 575-5% 1,518 1,579-4% Net Sales Revenue ( m) 1,817 1,918-5% 5,000 5,299-6% Currency-neutral NSR per case ( ) 3.32 3.23 +3% 3.29 3.21 +3% Comparable Gross Profit Margin 36.7% 36.8% -10bps 36.2% 35.9% +30bps Comparable OPEX % NSR 25.7% 26.0% -30bps 28.8% 28.6% +20bps Financial indicators on a comparable basis exclude the recognition of restructuring costs, unrealised commodity hedging results and non-recurring items. 5
Financial performance overview Q3 14 Q3 13 Ch. 9M 14 9M 13 Ch. Comparable EBIT ( m) 201 207-3% 368 386-5% Comparable EBIT Margin 11.1% 10.8% +30bps 7.4% 7.3% +10bps Comparable Net Profit ( m) 148 148 flat 247 259-5% Comparable EPS ( ) 0.41 0.41 flat 0.68 0.71-4% Free Cash Flow ( m) 250 248 +1% 345 345 flat Financial indicators on a comparable basis exclude the recognition of restructuring costs, unrealised commodity hedging results and non-recurring items. 6
13th consecutive quarter of growth in currency-neutral net sales revenue per case Total CCH Q3 14 9M 14 Volume -5% -4% Currency-neutral revenue per case +3% +3% Established Markets Volume -10% -6% Currency-neutral revenue per case +1% +1% Developing Markets Volume -11% -8% Currency-neutral revenue per case +3% +4% Emerging Markets Volume +1% -1% Currency-neutral revenue per case +5% +4% 7
Input cost environment continues to be favourable Currency-neutral input cost per case decreased by low single digits in the quarter and mid single digits in the first nine months EU sugar costs continued to decrease year on year World sugar costs remained on a downward trend PET resin costs decreased significantly year on year Aluminium costs were marginally higher in the quarter compared to the prior year 8
Continued efficiency improvements support profitability Q3 14 Q3 13 Ch. 9M 14 9M 13 Ch. Net Sales Revenue ( m) 1,817 1,918-5% 5,000 5,299-6% Comparable Operating Expenses ( m) (467) (498) -6% (1,440) (1,518) -5% Comparable OPEX as % of NSR 25.7% 26.0% -30bps 28.8% 28.6% +20bps Comparable EBIT Margin 11.1% 10.8% +30bps 7.4% 7.3% +10bps Financial indicators on a comparable basis exclude the recognition of restructuring costs, unrealised commodity hedging results and specific non-recurring items. 9
Mixed segmental trends in comparable operating profit Q3 comparable EBIT in million Euros Q3 14 Q3 13 Total CCH -6 201 207 Established -9 65 74 Developing -6 32 38 Emerging 8 104 96 Financial indicators on a comparable basis exclude the recognition of restructuring costs, unrealised commodity hedging results and specific non-recurring items Certain differences in sums are due to rounding 10
Restructuring update Q3 recap We incurred 18.6m in pre-tax restructuring costs in the third quarter Restructuring focus predominantly in Established markets FY 2014 targets We now expect total pre-tax restructuring charges to amount to 50m in 2014 Total benefits in 2014 (from 2013 and 2014 initiatives) are expected at approximately 38m 11
Positive free cash flow in the quarter in million Euros Q3 14 Q3 13 Abs. change 9M 14 9M 13 Abs. change EBITDA 265 296 (31) 613 624 (11) Cash from Working Capital 96 79 18 8 23 (15) Net Capital Expenditure (88) (105) 17 (228) (257) 29 Free Cash Flow 250 248 2 345 345 flat * Differences in the absolute year-on-year change are due to rounding 12
Diversified financial profile Debt maturity portfolio in million 800 600 $400 September 2015 November 2016 June 2020 13
2014 Financial outlook Currency-neutral net sales revenue per case expected to grow year on year at a higher rate than 2013 Currency-neutral input costs per case are still expected to decline by low single digits Adverse FX impact is now estimated to be in the 80m - 85m range Comparable effective tax rate in the range of 24% - 26% Annual capital expenditure in the range of 5.5% - 6.5% of net sales revenue Free cash flow expectation of approximately 1.3bn for the 2013-2015 period Financial indicators on a comparable basis exclude the recognition of restructuring costs, unrealised commodity hedging results and specific non-recurring items 14
Operational review and strategy Dimitris Lois - CEO
Fragile environment and unseasonably poor weather 575m u.c. -10% -11% +1% 548m u.c. Q3 13 Established Developing Emerging Q3 14 16
Juice was the key category driver in the quarter y-o-y growth Q3 14 9M 14 Sparkling -5% -4% Trademark Coca-Cola -5% -4% Coca-Cola Zero -1% 5% Juice 7% 4% Multon 16% 10% Water -5% -3% Energy -1% 1% Tea -8% -8% 17
Established markets Acceleration of negative volume trends Italy Volume declined by mid teens in the quarter Underlying macroeconomic and trading environment remains challenging Adverse weather resulted in the acceleration of negative trends Trademark Coca-Cola -11% Coca-Cola Zero -3% Water -7% Greece Volume increased by mid single digits, cycling high single-digit decline Volumes supported by good tourist traffic Water remained the key growth category Switzerland Volume declined by mid teens, cycling strong summer quarter in prior year Poor summer weather affected trading Volume -10% Currency-neutral net sales revenue per case +1% 18
Developing markets Focus on value Poland Volume declined by low double digits, cycling a low single-digit decline in the prior year Our value-accretive volume initiatives contributed to the decline, while supporting good NSR/case growth Hungary Volume turned negative, declining by mid single digits Increased competitive pressure and weather conditions negatively impacted volume Czech Rep Volume declined across all key categories Coca-Cola Zero was stable in the quarter Trademark Coca-Cola -7% Coca-Cola Zero -3% Water -18% Volume -11% Currency-neutral net sales revenue per case +3% 19
Emerging markets Growth in a volatile environment Russia Volume declined by low single digits, cycling low single-digit decline Disposable income under pressure Multon juice business grew by 10% 11th consecutive quarter of growth Nigeria Volume gained momentum to high single-digit growth Underlying demand remains robust Romania Volume declined marginally Trading environment remains competitive Trademark Coca-Cola stable Sparkling grew by +1%, while Juice continued to grow strongly RTD-Tea Juice -13% +13% Water +1% Volume +1% Currency-neutral net sales revenue per case +5% 20
Looking ahead We maintain our sharp focus on gaining share and delivering good profitability despite the significant volume headwinds. Group volume trends for 2014 are expected to be broadly similar to the ones we saw in the first half We expect to achieve another year of EBIT margin expansion and solid free cash flow generation, supported by: the positive trends in currency-neutral net sales revenue per case favourable input costs our efforts to improve operating costs and tight working capital management
Long-term growth drivers Most known brands in the world Diverse geographic footprint with strong emerging market exposure Low per capita consumption with great potential to grow Solid track record of winning in the marketplace Strong focus on cost leadership and history of solid cash generation 23