ATLANTIC GRUPA Financial results in 2014 (audited) Business growth coupled with the largest investment cycle in the company’s history Zagreb – 24th February 2015
CONTENT KEY DEVELOPMENTS IN 2014 PERFORMANCE ON CAPITAL MARKET IN 2014 FINANCIAL RESULTS IN 2014 GUIDANCE FOR 2015 APPENDIX 2
KEY BUSINESS DEVELOPMENTS IN 2014 Performance in line with guidance despite unfavourable macroeconomic situation Further deleveraging and growth of cash flow from operating activities Distribution of Unilever portfolio in Croatia and Slovenia Development of own brands and opening of new pharma locations N ew energy bars factory in Nova Gradiška – the largest capex in Atlantic Grupa’s history Signing the agreement for the acquisition of Foodland d.o.o. , Serbia Continued integration of information technologies Risk management 3
KEY BUSINESS DEVELOPMENTS: OWN AND PRINCIPAL BRANDS DISTRIBUTION: UNILEVER Globally famous brands Knorr, Hellman's, Axe, Rexona, Brut, Signal, Coccolino, Domestos, Cif and many others Distribution started at the beginning of 2014 Distribution in Croatia and Slovenia Confirms status of the leading distributor in the region SBU BEVERAGES Donat Mg won several distinguished marketing and product quality awards Financial Times: Cockta among 4 best cola drinks in the world New Cedevita packaging for home and HoReCa consumption 4
KEY BUSINESS DEVELOPMENTS: OWN AND PRINCIPAL BRANDS SBU COFFEE Barcaffe: 4 gold medals on International Coffee Tasting SBU SAVOURY SPREADS Argeta won Euro Effie for campaign „Approved by moms” Argeta exclusive a la Subida in cooperation with chef from Michelin starred restaurant SBU SNACKS Launching chips under brand Chipsos SBU PHARMA AND PERSONAL CARE 7 new specialized stores Barcaffe/ Market Argeta Smoki Cedevita share Grand kafa 2014 2013 2014 2013 2014 2013 2014 2013 Volume share Croatia 10.1% 7.2% 12.0% 8.7% 16.6% 10.9% 73.6% 66.9% Serbia 48.8% 48.1% 12.7% 11.8% 62.8% 61.4% 81.9% 82.7% Slovenia 65.7% 63.8% 34.7% 33.7% 42.7% 41.1% 80.2% 79.7% B&H - - 42.2% 40.50% 42.3% 40.9% 74.0% - Source: Nielsen Retail Panel for food and non-food categories. Period: YTD 11/2014 5
KEY BUSINESS DEVELOPMENTS: OWN AND PRINCIPAL BRANDS Top 10 in the region Top 5 Slovenia Top 5 Croatia Top 5 Serbia Top 5 B&H Top 5 Macedonia 1 Milka Barcaffe Jana Plazma Argeta Argeta 2 Coca Cola Milka Cedevita Milka Milka Stobi flips 3 Vegeta Radenska Vegeta Smoki Coca Cola Coca Cola 4 Cedevita Argeta Jamnica Coca Cola Violeta Milka Knjaz Miloš 5 Argeta Alpsko mleko Coca Cola Vegeta Pelisterka 6 Orbit 7 Smoki 8 Cockta 9 Nivea 10 Pepsi Research of the Valicon agency: Argeta, Barcaffe, Cedevita, Cockta and Smoki are among top 10 brands in the region The strength of brands was calculated on the basis of their recognisability, experience and use. 6
KEY BUSINESS DEVELOPMENT: NEW ENERGY BARS FACTORY IN NOVA GRADIŠKA Transferring the production from the contractual producer to own plant Project with the total value of HRK 100 million All works performed in time: 11/2013 Real estate acquired 01/2014 Permissions acquired 03/2014 Technology chosen/equipment ordered 04/2014 Building work starts 10/2014 Building work finished 11/2014 First line delivered & installed 12/2014 Test productions start 02/2015 Full scale production starts 7
KEY BUSINESS DEVELOPMENT: ACQUISTION OF FOODLAND (1/2) Established in 1998 with headquarter in Belgrade,Serbia Production of high-quality products under own brands: Bakina Tajna or Granny’s Secret (paprika relish, jams, fruit butters, juices) Amfissa (olives, cornichons, roasted red peppers, capers, dried tomatoes, etc) Own production facility in Igros, southern Serbia Sales of EUR 8.3 m* in FY2014 * Preliminary unaudited results 8
KEY BUSINESS DEVELOPMENT (IV): ACQUISTION OF FOODLAND (2/2) REASONING FOR THE ACQUISTION International expansion potential Granny’ Secret with its palette of supreme quality products prepared in a traditional way, without additives or preservatives, meets both aims defined in AG’s development strategy: expanding the current brand portfolio with international potential (alongside Argeta, Donat Mg, Multipower, Bebi and Cedevita GO!) and internationalization. Regional expansion Using the strength of AG’s distribution network and infrastructure to increase distribution reach of brand Granny’s Secret across the region and Amfissa and principal brands in Serbia and Montenegro. Cost synergies More efficient procurement of raw/packaging materials, centralized transportation management, merging of logistics activities, processes and spaces, more efficient production, better customer control, higher marketing power. Geographic sales profile in 2014 Sales profile 2014 Regional markets 12% Other 9% Principal brands 15% Sweet Other products Granny's Vegetables markets 30% product secret 50% 28% 20% Amfissa Serbia 26% 60% 9
CONTENT KEY DEVELOPMENTS IN 2014 PERFORMANCE ON CAPITAL MARKET IN 2014 FINANCIAL RESULTS IN 2014 GUIDANCE FOR 2015 APPENDIX 10
PERFORMANCE ON CROATIAN CAPITAL MARKET Performance on capital market Ownership structure as of 31.12.2014 ATGR-R-A Crobex 48% Management Crobex10 34% 40% 1.1% Tedeschi Fiorio Lada 31% Erste Plavi 5.8% 18% OMF 16% AZ OMF 10% 7% 3.3% 3% 0% 3.9% 5% 2% Other 1% EBRD 0% 14.1% PBZ CO OMF 8.5% -1% -3% 1.4% -15% Raiffeisen -18% Pension funds DMF -40% 20.3% Tedeschi Emil 1.4% -38% Raiffeisen OMF 50.2% 9.6% Other pension -47% funds 0.6% -67% -80% 2014. 2013 2012 2011 2010 2009 2008 * Free float: 35.5% Valuation 2014 2013 In August 2014 the highest historic price of HRK 1,080.50 . With growth of 31% in 2014 it outperformed both Last price in reporting period 940.0 718.0 indices. Market capitalization* (in HRK millions) 3,134.2 2,394.0 November 2014: German development bank – DEG reduced its ownership share from 8.5% to 2.3% in the Average daily turnover (in HRK thousands) 299.5 237.8 accelerated bookbuilt process (ABB). EV (in HRK millions) 5,064.3 4,504.7 Strong demand of investors: oversubscribed book by EV/EBITDA 8.5 7.6 1.7x The complete offering was allocated at HRK 925 EV/EBIT 11.5 10.6 The transaction amounted to EUR 25 million EV/sales 1.0 0.9 58% investment funds, 39% pension funds and 3% EPS (in HRK) 60.0 58.5 banks and individual investors P/E 15.7 12.3 65% domestic investors and 35% foreign investors * Closing price multiplied by the total number of shares 11
CONTENT KEY DEVELOPMENTS IN 2014 PERFORMANCE ON CAPITAL MARKET IN 2014 FINANCIAL RESULTS IN 2014 GUIDANCE FOR 2015 APPENDIX 12
RESULTS IN LINE WITH GUIDANCE (in HRKm) 2014A/2014E: 98.1 2014A/2014E : 96.3 2014A/2014E : 95.8 2014A/2013A: 102.4 2014A/2013A: 101.1 2014A/2013A: 103.8 5,220 2014A 2014A 620 597 591 700 5,118 2014E 2014E 5,200 2013A 2013A 4,999* 600 460 441 500 425 5,000 400 4,800 300 200 4,600 100 0 4,400 EBITDA EBIT Sales * Sales for 2013 were restated, as explained on the following slide 13
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