AGENDA 1. WELCOME AND INTRODUCTION PEARSON GOWERO 2. TRADING - PowerPoint PPT Presentation

AGENDA 1. WELCOME AND INTRODUCTION PEARSON GOWERO 2. TRADING REVIEW PEARSON GOWERO 3. FINANCIALS MATTS VALELA 4. DISCUSSION/QUESTIONS ALL 5. REFRESHMENTS ALL

VOLUME BEVERAGE CATEGORY • Declined by 7% LAGER BEER • SBs declined by 11% SOFT DRINKS • Declined by 3% SORGHUM BEER

TRADING ENVIRONMENT-MOSTLY HEADENDS 1. Calendar 2016 most challenging year since dollarisation. - limited payment platforms. - cash withdrawal limits. - bond note introduction had limited impact on cash shortages. - delays in foreign payments. 2. Numerous fiscal and monetary policy interventions which made the operating environment increasingly uncertain. 3. Aggressive Zimra collection measures and numerous police roadblocks. 4. Heavy rains – damages to road infrastructure, reduced access to markets and consumption occasions. 5. Generally stretched consumers and traders; increased credit risk.

VOLUME PERFORMANCE SUMMARY Category Actual Volume % Change on 000hl Prior Year 1. BEVERAGES (HLS 000) 1.1 Clear Beer 1 214 (7) 1.2 Sorghum Beer 3 488 (3) 1.3 Sparkling Beverages 1 237 (11) 1.4 Alternative Beverages 160 (16) Total Excluding Associates 6 099 (6) 2. Malt Tonnage 27 560 (21)

VOLUME BY PROVINCE Lager Beer Sorghum Beer Soft Drinks F17 F16 F17 F16 F17 F16 Bulawayo 11 11 10 6 13 12 Harare 45 46 33 32 47 46 Manicaland 11 11 12 13 3 3 Mashonaland Central 1 1 2 3 2 2 Mashonaland East 2 3 1 1 1 3 Mashonaland West 9 9 16 16 10 9 Masvingo Province 7 7 11 13 7 8 Matabeleland North 2 2 1 2 2 2 Matabeleland South 1 1 2 2 2 2 Midlands Province 11 9 12 12 12 11 Grand Total 100 100 100 100 100 100

QUARTERLY VOLUME & REVENUE PERFORMANCE 1,800 $200 $174 $163 $180 1,600 $152 $143 $160 1,400 Volume Hl '000 Gross Sales $million $140 $151 1,200 $155 $120 $136 1,000 $121 $100 800 $80 600 $60 400 $40 200 $20 - $- Q1 Q2 Q3 Q4 Volumes F17 Gross sales F16 Gross sales Significant revenue loss in second half

LAGER BEER VOLUME & REVENUE PERFORMANCE LAGER BEER FULL YEAR VOLUME PERFORMANCE F13 TO F17 2 500 $400 $352 $350 2 000 2 060 Gross sales $million $300 $316 $278 $250 1 697 Volume Hl '000 1 500 $235 $215 1 414 $200 1 307 1 000 1 214 $150 $100 500 $50 0 $0 F13 F14 F15 F16 F17 Volume Gross Sales

LAGER BEER VOLUME & REVENUE PERFORMANCE LAGER BEER VOLUME & GROSS SALES BY QUARTER 350 $70 318 331 300 $60 290 Gross sales $million 275 $57 $59 250 $50 $52 Volume Hl '000 $48 200 $40 150 $30 100 $20 50 $10 0 $0 Q1 Q2 Q3 Q4 Volume Gross Sales

TRADING REVIEW- LAGER BEER MIX HLs ‘000 1,400 1,200 27% 26% 1,000 Premium 800 59% 59% 600 400 200 14% 15% - F16 F17

LAGER BEER • Slower decline in volume – stabilised mix. • Market share remained steady. • Mainstream contribution anchored by 750ml pack.

SORGHUM BEER VOLUME & REVENUE PERFORMANCE 4,000 $250 3,716 3,587 3,442 3,488 3,500 3,080 $200 Gross sales $million 3,000 $193 $179 2,500 Volume Hl '000 $176 $150 $146 2,000 $100 $118 1,500 1,000 $50 500 - $0 F13 F14 F15 F16 F17 Volume Gross Sales

LAGER BEER VOLUME & REVENUE PERFORMANCE SORGHUM BEER VOLUME & GROSS SALES BY QUARTER 1 200 $60 $51 $46 1 000 $50 $45 Gross sales $million 967 $38 800 $40 936 842 Volume Hl '000 743 600 $30 400 $20 200 $10 0 $0 Q1 Q2 Q3 Q4 Volume Gross Sales

TRADING REVIEW- SORGHUM BEER MIX HLs ‘000 4 000 3 500 3 000 56% 60% 2 500 2 000 1 500 44% 40% 1 000 500 0 F16 F17 Chibuku Chibuku Super

SORGHUM BEER • Chibuku Super growth constrained by capacity limitations and water shortages up to December 2016. • Masvingo and Kwekwe breweries commissioned in last quarter. • Scud resilient as a value pack. • Market access affected by damages to road infrastructure. • Cash shortages restricted consumption particularly in rural areas.

SPARKLING BEVERAGES VOLUME & REVENUE PERFORMANCE 1,800 $250 $231 $225 $204 1,600 1,615 $183 $200 1,589 1,400 Gross sales $million 1,472 1,200 $154 1,385 Volume Hl '000 $150 1,237 1,000 800 $100 600 400 $50 200 - $0 F13 F14 F15 F16 F17 Voulme Gross Sales

LAGER BEER VOLUME & REVENUE PERFORMANCE SOFT DRINKS VOLUME & GROSS SALES BY QUARTER 500 $60 $51 450 $50 400 $43 Gross sales $million 350 441 $37 $35 $40 362 Volume Hl '000 300 293 250 $30 301 200 $20 150 100 $10 50 0 $0 Q1 Q2 Q3 Q4 Volume Gross Sales

TRADING REVIEW- SPARKLING BEVERAGES MIX HLs ‘000 1 600 1 300 42% 40% 1 000 Convenience pack RGB 700 58% 60% 400 100 F16 F17

SPARKLING BEVERAGES • Increased imports – traders exploiting COMESA protocol (Zambia and Mozambique). • Growth in value packs. • Overall franchise brands at over 90% market share shored up by parallel imports.

BEVERAGE VOLUME CONTRIBUTION F16 F17 Maheu Maheu Lagers Lagers 3% 3% 20% 20% SBs SBs 20% 21% Sorghum Sorghum 57% 56%

VOLUME CONTRIBUTION BEER CATEGORY F16 F17 Lagers Lagers 26% 27% Sorghum Sorghum 74% 73%

ASSOCIATES AFDIS • Stable volume and revenue performance. • Factory throughput constrained by delayed foreign payments. SCHWEPPES ZIMBABWE LIMITED • Steady volume performance in core beverages. • Financial performance weighed down by agri-processing units; Best Fruit Processors and Beit Bridge Juicing Company. NAMPAK ZIMBABWE * Expected to publish half year results in May 2017. • Challenges with foreign payments.

OTHER DEVELOPMENTS 1. Change in major shareholder following combination of AB InBev and SABMiller as of 10 October, 2016. Trigger for Bottling franchise issues. 2. The Coca-Cola Company issued a notice of intention to terminate the Bottler Agreements with Delta and its associate SZL. TCCC and AB InBev intention to restructure interests. Negotiations are underway with TCCC and AB InBev. There is no position yet on Zimbabwe.

AGENDA 1. FINANCIAL HIGHLIGHTS 2. FINANCIAL STATEMENTS

VOLUME & REVENUE PERFORMANCE ENDING 31 MARCH 2017 % CHANGE VS PR. YR VOLUME REVENUE Volumes (000hls) • Lager Beer (7%) (8%) • Sorghum beer (3%) (6%) • Soft Drinks (11%) (15%) Total (6%) (10%)

FINANCIAL HIGHLIGHTS REVENUE Declined by 10% to $483 million (Turnover - $563m) EBIT Down by 15% to $82 million OPERATING MARGIN % Down from 20% to 19,07%

FINANCIAL HIGHLIGHTS Cont…. EBITDA Down by 13% to $112,8 million ATTRIBUTABLE INCOME Declined by 13% to $69,9 million EARNINGS PER SHARE Decreased by 12% to US5,70 cents DIVIDEND PER SHARE DIVIDEND PER SHARE Up 16% on prior year Interim dividends paid per share- US 3,00cents Final dividend proposed per share- US 2,45 cents

STATEMENT OF COMPREHENSIVE INCOME FOR THE PERIOD MARCH 2017 MARCH 2016 US$000’s US$000’s REVENUE 482 968 538 198 Operating income 82 044 96 072 Net finance expense 4 539 5 895 Share of associates profit 1 834 3 944 PROFIT BEFORE TAX 88 417 105 911 Taxation ( 18 532) (25 822) PROFIT FOR THE YEAR- CONTINUING 69 885 80 089 OPERATIONS Profit for the year from discontinued operations - - TOTAL COMPREHENSIVE INCOME FOR THE 69 885 80 089 YEAR

EARNINGS PER SHARE MARCH MARCH % 2017 2016 Change Normal EPS (from Continuing 5,70 6,49 (12) operations) – Cents Fully Diluted EPS (from 5,69 6,48 (12) Continuing operations) Cents Dividend per share - Cents 5,45 4,70 16

SEGMENT OPERATING INCOME MARCH MARCH MARCH 2017 2016 2016 US$’ 000 US$’ 000 US$’ 000 25 575 22 525 LAGER BEER 22 866 25 575 39 108 87 208 SPARKLING BEVERAGES 14 295 22 525 8 864 96 072 SORGHUM BEER 34 986 39 108 TOTAL REPORTABLE SEGMENTS 72 147 87 208 ALL OTHER SEGMENTS 9 897 8 864 TOTAL OPERATING INCOME 82 044 96 072

STATEMENT OF FINANCIAL POSITION MARCH 2017 2016 ASSETS US$000’s US$000’s Non-current assets Property, plant and equipment 354 947 345 332 Investments, loans and trademarks 56 124 54 776 TOTAL NON-CURRENT ASSETS 411 071 400 108 CURRENT ASSETS Inventories 77 753 86 431 Trade and other receivables 41 931 43 683 Cash and cash equivalents 173 334 166 016 TOTAL CURRENT ASSETS 293 018 296 130 TOTAL ASSETS 704 089 696 238

STATEMENT OF FINANCIAL POSITION MARCH cont… 2017 2016 EQUITY AND LIABILITIES US$000’s US$000’s Share Capital 12 301 12 310 Share Premium 32 044 33 074 Reserves 7 389 5 985 Retained Earnings 452 128 436 530 Shareholder’s equity 503 862 487 899 Long- term borrowings - 65 000 Deferred taxation 50 022 48 833 50 0222 113 833 CURRENT LIABILITIES Short term borrowings 60 000 - Interest free liabilities 90 205 94 506 TOTAL CURRENT LIABILITIES 150 205 94 506 TOTAL EQUITY AND LIABILITES 704 089 696 238

CASH FLOW 2017 2016 US$000’s US$000’s Cash flow from operating 108 344 137 463 activities Net cash invested (40 460) (49 426) Net funding 113 334 101 016

SHARE CAPITAL MOVEMENTS Shares in Issue as at 31 March 2016 1 244 313 975 Share Options Exercised 1 198 225 Cancelled shares (2 108 076) Shares in Issue as at 31 March 2017 1 243 404 124 Shares held in treasury 21 218 614