Annual Results and Strategic Roadmap J U N E 4 t h , 2 0 2 0 - PowerPoint PPT Presentation

2019/20 Annual Results and Strategic Roadmap J U N E 4 t h , 2 0 2 0

Introduction M A R C H E R I A R D - D U B R E U I L , P R E S I D E N T

2019/20: a singular year 3

2019/20: a singular year CHANGE Ending March, in €m 2019/20 Reported Organic 1,024.8 -9.0 % -11.2 % Sales 997.3 -4.0 % -6.3 % of which Group Brands Current Operating Profit 215.1 -18.6 % -22.0 % of which Group Brands 237.0 -13.6 % -17.0 % 21.0 % -2.5 pt -2.9 pt Current operating margin 113.4 -31.7 % Net profit (Group share) -28.8 % Earnings per share 2.28 -28.4 % -31.3 % 124.2 -26.9 % -29.9 % Net Profit - excluding non-recurring items Earnings per share (in €) 2.49 -26.5 % -29.6 % excluding non-recurring items Net debt / EBITDA ratio: 1.86 +0.67 pt - 4

Business Review E R I C V A L L A T, C H I E F E X E C U T I F O F F I C E R

Key financial indicators Group Brands sales down 6.3% in organic terms (-4.0% on a reported basis): • 2019/20 affected by a number of headwinds: the COVID-19 pandemic, threats of import taxes in the US, geopolitical instability, as well as the consequences of decisions taken by the Group, including RTM changes in the EMEA region and the termination of several Partner Brands’ distribution contracts • Group sales down 11.2% in organic terms (-9.0% reported) Current Operating Margin showing resilience at 21.0% • Strong Gross Margin’s performance (+2.8pts in organic terms), led by the refocus on Group Brands • Sustained strategic A&P investments (new communication campaigns for Rémy Martin, Port Charlotte and The Botanist) • Structure costs under pressure (ratio +3.8pts in organic terms) due to declining sales • Favorable currency effects (+0.4pt) Adjusted Net profits (ENRI) stand at EUR124.2M and Net Profit margin at 12.1% 6

Key non-financial achievements 100% sustainable agriculture in Cognac Rated number 1 by EthiFinance among French mid-cap companies (Gaïa index) B-Corp: Bruichladdich Distillery certified B corporation 7

Sales Growth by Product Division House of Liqueurs & Group Partner Total Rémy Martin Spirits Brands Brands Group 0% -5% (-0.3% excluding technical factors) -10% (-2.8% excluding technical factors) (-3.8% excluding technical factors) -15% (-3.0% excluding technical factors) -20% -25% -30% (-4.4% excluding -35% technical factors) 8 Note: Technical factors include the termination of distribution contracts for Partner Brands and the COVID 19 hit in Q4

Breakdown of Group sales By Division By Region Liqueurs & Americas Spirits 45% Asia 25% Pacific 31% Partner Brands 3% Europe, Middle House of Rémy East & Africa Martin 24% 72% 9

Breakdown by region G r o u p B r a n d s Liqueurs & Spirits Rémy Martin €261.9M €735.5M Asia Pacific 12% Asia Pacific Americas 45% 39% Americas 46% Europe Middle East & Europe, Middle East Africa & Africa 15% 43% 10

Current Operating Profit Reported decline: -18.6% (€m) Currency Volume/ A&P Price/ Others Mix Mix +9.1 -58.5 264.1 +1.5 +11.5 -12.6 215.1 Organic: -22.0% - €58.1m March 20 March 19 COP/Sales: 21.0% COP/Sales: 23.5% (Org: 20.6%) 11

Net Profit (€m) Net profit Net profit Group share excluding non-recurring items Reported -28.8% Reported -26.9% -31.7% organic change -29.9% organic change 169.9 159.2 124.2 113.4 March 19 March 20 March 19 March 20 12

House of Rémy Martin O r g a n i c s a l e s d e c l i n e o f 7 . 5 % ( vo l u m e s - 1 0 . 1 % ) Sales Asia Pacific (in €millions) • Double-digit growth in Mainland China +10.0%* +13.2%* +11.9%* -7.5% more than offset by weakness in South East Asia and Travel Retail Asia 851.9 900 774.4 760.0 735.5 Americas 707.5 750 • US sales penalized by the reduced level of inventories carried by US retailers 600 EMEA 450 • Good growth in Africa and in the Nordics 300 was more than offset by weakness in Western Europe and in Russia 150 0 March March March March March 2017 2018 2019 2019 Post 2020 Proforma IFRS * Organic growth (proforma Pre-IFRS 15) 13

Marketing initiatives NEW GLOBAL CAMPAIGN TEAM UP FOR LAUNCH OF REMY MARTIN EXCELLENCE “TERCET” 14

Marketing initiatives LOUIS XIII LOUIS XIII LAUNCHES TIME COLLECTION 1900 ITS FIRST E-BOUTIQUE IN THE UK TRIBUTE TO CITY OF LIGHTS 15

House of Rémy Martin C u r r e n t o p e r a t i n g p r o f i t ( € m ) Reported decline: -15.3% Volume/ Price/ Currency A&P Others Mix Mix +6.8 -40.4 235.6 +10.7 -1.8 -11.3 199.5 Organic -18.2% - €42.9m March 20 March 19 COP/Sales: 27.1% COP/Sales: 30.4% (Org: 26.9%) 16

Liqueurs & Spirits O r g a n i c s a l e s d e c l i n e o f 3 . 0 % ( vo l u m e s - 3 . 4 % ) Cointreau • Robust performance in the Americas was mitigated by weakness in Sales EMEA and Asia Pacific (in €millions) Metaxa -3.0% +1.3%* -1.0%* +4.0%* • Weakness in the EMEA (changes in RTM and a poor performance in 350 Travel Retail); promising expansion in newer markets of Asia and Americas 276.3 276.6 300 266.8 261.9 264.4 St-Rémy • Performance held back by EMEA and Asia, while the Americas 250 delivered a strong performance, led by successful marketing initiatives in Canada/the US 200 Mount Gay 150 • Sales weakness led by the voluntary slow-down in shipments ahead of the gradual restaging of the brand in 2020/21 100 The Botanist 50 • Continued strong sales growth, led by ongoing strength in the US 0 and brand expansion in Asia-Pacific March March March March March 2017 2018 2019 2019 Post 2020 Single-Malt Whiskies Proforma IFRS • Benefiting from worldwide strong momentum in the single malt * Organic growth (proforma Pre-IFRS 15) category, in particular in the US 17

Marketing initiatives COINTREAU METAXA: THE BOTANIST LAUNCH OF “LE COCKTAIL SHOW” INTERNATIONAL EXPANSION NEW COMMUNICATION CAMPAIGN “WILD, A STATE OF MIND” COMMUNICATION PLATFORM WITH THE CLUMSIES BAR 18

Liqueurs & Spirits C u r r e n t o p e r a t i n g p r o f i t ( € m ) Reported decline: -3.5% Price/ Currency Volume/ A&P Others Mix Mix -5.7 +2.5 -1.4 +2.6 38.8 37.5 +0.7 Organic - 9.9% - €3.9m March 19 March 20 COP/Sales:14.3% COP/Sales: 14.7% (Org: 13.6%) 19

Partner Brands O r g a n i c s a l e s d e c l i n e o f 6 8 . 7 % ( vo l u m e s - 7 0 . 7 % ) • Sales decline largely due to the termination Sales (in €millions) of sizable partner brand distribution contracts in Czech republic, Slovakia and -14.2%* -10.4%* -12.7%* -68.7% 150 the US (€56M impact) • In line with Group’s strategy of gradually 111.0 refocusing on its Group Brands 100.2 100 87.9 87.2 50 27.5 0 March March March March March 2017 2018 2019 2019 Post 2020 Proforma IFRS * Organic growth (proforma Pre-IFRS 15) 20

Partner Brands C u r r e n t o p e r a t i n g p r o f i t ( € m ) • COP decline is the consequence of the COP (in €millions) revenue evolution (EUR5M hit from the -72.4%* +175.7%* -7.2%* -132.0% termination of contracts) 8,0 6,0 5.3 4,9 4.9 4,0 2.0 2,0 -1.7 0,0 March March March March March 2017 2018 2019 2019 2020 Proforma Post -2,0 IFRS * Organic growth (proforma Pre-IFRS 15) 21

Financial Results L U C A M A R O T T A , C H I E F F I N A N C I A L O F F I C E R

Current Operating Profit CHANGE Ending March, in €m 2019/20 2018/19 Reported Organic Net Sales 1,024.8 1,125.9 -9.0% -11.2% Gross Profit 676.9 710.9 -4.8% -7.3% • in % 66.0% 63.1% +2.9pts +2.8pts • Sales and marketing expenses (355.0) (346.0) +2.6% +0.2% • Administrative expenses (106.8) (100.7) +6.0% +5.7% Current Operating Profit 215.1 264.1 -18.6% -22.0% Current operating margin 21.0% 23.5% -2.5pt -2.9pt 23

Current Operating Margin Reported COP/Sales : -2.5 pts +2.8 pts -1.9 pts -3.8 pts 23.5% +0.4 pt 21.0% 0.0 pt Organic COP/Sales: -2.9 pts March 2019 Gross A&P Distribution/ Currency Scope March 2020 COP/Sales COP/Sales Margin others 24

Net profit CHANGE Ending March, €m 2019/20 2018/19 Reported Organic 215.1 264.1 -18.6% -22.0% Current Operating Profit (19.7) 1.7 - - Other operating income (expenses) 195.5 265.8 -26.5% -29.6% Operating profit (28.0) (32.5) - - Net financial income (charge) Pre-tax profit 167.5 233.3 -28.2% -31.5% Taxes (60.9) (67.7) - - 36.3% 29.0% +7.3pts +7.2pts Tax rate 0.3 (6.7) - - Share profit (loss) of associated companies Net profit from discontinued operations, halted or sold 6.4 0.0 - - 0.1 0.2 - - Minority Interest Net profit Group share 113.4 159.2 -28.8% -31.7% Net profit (excluding non-recurring items) 124.2 169.9 -26.9% -29.9% Net margin (excluding non-recurring) 12.1% 15.1% -3.0pt -3.2pt 25

Non-recurring items Ending March, €m 2019/20 2018/19 Net profit – Group share 113.4 159.2 Westland’s goodwill write -off 18.8 - Non-recurring tax items (2.5) 0.1 Net profit from discontinued operations, halted or sold (6.4) - Expense on vendor loan (financial charge) - 5.2 Disposal of the stake in the Diversa joint venture (net of exit costs) - 7.0 Others 0.9 (1.6) Net profit excluding non-recurring items – Group share 124.2 169.9 26