Analyst presentation annual results 2016/17 Year ended 31 March 2017
Disclaimer DISCLAIMER THIS PRESENTATION may contain forward looking statements. These statements are based on current expectations, estimates and projections of Lucas Bols’ management and information currently available to the company. Lucas Bols cautions that such statements contain elements of risk and uncertainties that are difficult to predict and that could cause actual performance and position to differ materially from these statements. Lucas Bols disclaims any obligation to update or revise any statements made in this presentation to reflect subsequent events or circumstances, except as required by law. Certain figures in this presentation, including financial data, have been rounded. Accordingly, figures shown for the same category presented in different tables may vary slightly and figures shown as totals in certain tables may not be an exact arithmetic aggregation of the figures which precede them. 2
1. Lucas Bols at a glance 2. Highlights 2016/17 3. Operational review 4. Financials 2016/17 5. Outlook 3
Lucas Bols at a glance Great cocktail Over 1 1 0 countries, margin Am sterdam e experiences around 5 3 % revenue outside 80.5 1 5 7 5 the world W estern Europe Emerging Western Markets Strategic framework: Europe 23% 13.4% Build the brand equity North 46.7% 20.0% America 18.5% 45.9% Lead the development of 18.2 the cocktail market 22.7% 19.9% Accelerate global brand growth Revenue EBIT* Asia-Pacific > 2 5 brands €m €m 4 6 Bols liqueur Leverage operational FY 2 0 1 6 / 1 7 flavours excellence % of total FY 2016/ 17 revenue 4 Note *: EBIT is defined as ‘operating profit’ including ‘share of profit of joint ventures, net of tax’
Strong offering of global brands and regional brands Revenue structure Global brands Regional brands FY 2016/17 Liqueurs White Spirits Bols Liqueurs Range Regional brands 29,8% 28.2 % Dutch Jenever portfolio Italian Liqueurs Passoã 70,2% 71.8 % Global brands Value brands 5
1. Lucas Bols at a glance 2. Highlights 2016/17 3. Business review 4. Financials 2016/17 5. Outlook 6
Highlights 2016/17 Strong revenue growth of 10.8% to € 80.5 million as a result of both 3.4% organic growth and consolidation Revenue of the first four months of Passoã Brand Revenue of the global brands increased by 14.8% (+4.2% organically), while regional brands delivered performance 1.8% revenue growth (+1.6% organically) Regional All regions performed well, with good revenue growth in Emerging Markets (+20.1% organically) and North performance America (+4.7% organically) Gross profit was up 13.4% (4.3% organically) and gross margin increased by 130 bps to 60.1% (+50 bps Gross margin organically) Substantially increased investments in the commercial organisation and A&P compared to a year ago EBIT (+ € 2.3 million) resulted in a slight decline in organic EBIT Net profit increased 28.6% to € 15.1 million (2015/16: € 11.7 million), including one-off tax benefit. Net Profit Normalized net profit was € 12.3 million. Proposed final dividend of € 0.26 per share, bringing total full-year dividend to € 0.57 per share, up 5.6% Dividend compared to 2015/16 7
1. Lucas Bols at a glance 2. Highlights 2016/17 3. Business review 4. Financials 2016/17 5. Outlook 8
Lucas Bols: Four strategic pillars Lead the development of Build the brand equity the cocktail market Increase market position of the global brands Use marketing techniques and strategic and maintain the competitiveness innovation to optimise the product of regional brands offering and positioning Leverage operational Accelerate growth global excellence brands Tailor growth strategies for the brands to Maintain and optimise current business model the markets within our four geographic segments with a mix of in-house and outsourced activities 9
Strengthening of the positioning of the Lucas Bols brands Optimisation of Bols Liqueurs range portfolio, increase in market share US • Continued introduction of new flavours in various markets worldwide. Bols • New listings, expansion of flavours in various states and the first good Liqueurs results in retail in the US. • Entering new markets, with focus on Africa and Eastern Europe. Continued good growth rates • Bols Genever launched in Scandinavia, South-Korea, Italy and Poland. • BATW contest accelerated Bols Genever knowledge and experience among global bartending community. White • Damrak Gin gained market share in the Netherlands, achieved growth in spirits the US and was successfully launched in Italy. • Introduction of Bols Vodka in China, Thailand and Vietnam, good performance in Scandinavia and the Netherlands. 10
Strengthening of the positioning of the Lucas Bols brands Double digit revenue growth on the back of a recovery in Australia • Full Galliano range introduced in a number of markets, including Italy, Poland and Italian Australia. Liqueurs • Galliano L’Aperitivo was introduced in the Netherlands, Israel, Canada and the US. • Vaccari performed well in the Mexican market and The Netherlands. The brand is performing well and in line with expectations • Successful establishment and operation of Passoã SAS in France. • First focus on understanding the Passoã brand, now ready to fully integrate Passoã Passoã into brand plans. • Strong performance in UK, Australia and Japan. • Integration of Passoã into Lucas Bols USA. 11
Regional brands performed well, especially outside NL Increase in market share in still declining market Dutch • Floryn and Legner further strengthened the market position in the Dutch domestic domestic spirits market. portfolio • Market share increase to over 30% of the genever/vieux category. Other regions are becoming increasingly important • Regional brands are performing increasingly well outside the Netherlands, Outside the contributing to the stabilization of the regional brands. Netherlands • Africa is one of the most promising regions for future growth for spirits. • Leveraging the strong brand equity of the Henkes brand, Henkes Gin and Henkes Whiskey were introduced in various African markets. 12
Full revamp House of Bols Cocktail & Genever Experience Full revamp • After 10 years with nearly 500,000 visitors, The House of Bols was fully revamped in 2016/17 Redesign focused on : • Craftsmanship: spectacular new extraction and ingredients room • Flavour: new ‘art of flavour’ experience • Do-It-Yourself: new bar for visitors to make their own cocktail 13
Lucas Bols: Four strategic pillars Lead the development of Build the brand equity the cocktail market Increase market position of the global brands Use marketing techniques and strategic and maintain the competitiveness innovation to optimise the product of regional brands offering and positioning Leverage operational Accelerate growth global excellence brands Tailor growth strategies for the brands to Maintain and optimise current business model the markets within our four geographic segments with a mix of in-house and outsourced activities 14
Bols around the world – the Genever edition 2016/17 • BATW is a global competition that aims to grow bartenders careers, as well as their passion for bartending. • > 2.000 participants from over 75 countries. • Grand final in Amsterdam on 10 May 2017 in ‘The Bols Genever Street’, attended by industry experts and endorsers from around the world. • Jessica Mili from Canada is the proud winner. • Great online exposure and wide international press coverage. 15
Bols Business Class and Bols Bartending seminars • Bols Business Class aimed at bartenders and bar owners in more sophisticated markets. • Four editions were hosted in 2016/17 in Copenhagen, St. Petersburg, Bristol and Warsaw • Bols Bartending Academy seminars are typically held in countries where the cocktail market is still developing • This year events were organized in amongst others Indonesia, Vietnam, Malta, Spain and South Korea 16
Lucas Bols: Four strategic pillars Lead the development of Build the brand equity the cocktail market Increase market position of the global brands Use marketing techniques and strategic and maintain the competitiveness innovation to optimise the product of regional brands offering and positioning Leverage operational Accelerate growth global excellence brands Tailor growth strategies for the brands to Maintain and optimise current business model the markets within our four geographic segments with a mix of in-house and outsourced activities 17
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