Fevertree Drinks plc Preliminary Results Year ended 31 December - PowerPoint PPT Presentation

Fevertree Drinks plc Preliminary Results Year ended 31 December 2014 Tim Warrillow, Co-founder and CEO Andrew Branchflower, Finance Director

Introduction to Fever-Tree • Launched by Charles Rolls and Tim Warrillow in 2005 • Simple premise:  A significant and long term growth in premium spirits  Not matched by any premium offering in mixers category  Fever-Tree was launched at ideal moment to provide a quality mixer range to fill the vacuum • The world’s leading premium mixer brand with 80 million bottles sold in 2014 • Now in 50 countries worldwide, with 68% of sales overseas “Fever -Tree is burning up our charts, dominating its category like no other brand in any other sector” Drinks International 2015 Brands Report 1

Key Strengths Market leading brand • First mover advantage with international • Leading premium mixer brand around the reach world • Ingredients, taste, packaging and story Clearly differentiated premium product • Acclaimed product proposition ‘The World’s Best Tonic’ Robert Parker Proven business • Scalable outsourced business model model and • Strong founder-led management team management team • Global mixer market in early stages of Significant growth premiumisation opportunities • Potential addressable market of approx £1.6bn RSV (EY, 2014) Growth underpinned • Higher cash and % margin for the trade by strong margins ‘My tonic is Fever - Tree’ and spirits partners throughout value chain Ferran Adria 2

Financial highlights A successful year of growth underpinned by strong steady margins and cash flow conversion £m FY14 FY13 Growth Revenu enue 34.7 23.3 49% 49% Gross profit fit 17.7 11.9 49% 49% Gross margin 50.9% 51.0% EBIT ITDA* A* 10.0 6.7 48% 48% EBITDA Gross EBITDA margin 28.8% 28.9% • Operating cash flow conversion of 73% of EBITDA (2013: 75%) • Strong balance sheet with net cash at year end of £3.3m • Final dividend of 0.30 pence per share recommended to shareholders • Progressive dividend policy 3 7 * defined as Operating Cash flow / EBITDA *Pre-exceptional items

Review of the year Regional review (i) • Our global sales are across four regions: the UK, USA, Continental Europe and Rest of the World • UK is the Group’s largest single country, representing 32% of sales • 68% of sales generated overseas reflecting Fever- Tree’s international appeal • Diverse customer base with no single customer accounting for >5% of sales 2014 Revenue by Region Historic Revenue by Region UK 4

Review of the year Regional review (ii) • Largest country, 32% of total sales • Growth of 60% • Strong rate of sale growth in all three major retail UK customers (Waitrose, Sainsbury’s and Tesco) plus significant distribution increase at Tesco • Strong growth in the On-Trade where 60% of revenue is generated • Second largest country, 24% of total sales • Growth of 59% with a strong finish to the year • Significant new national listings in both On and Off- USA Trade • Ginger Beer sales up 91% driven by the growing popularity of “Moscow Mule” cocktail and represent over 33% of all US sales 5

Review of the year Regional review (iii) • 39% of total sales made across 25 countries • Growth of 35% across region Continental • Continued impressive sales growth in Belgium Europe • Gin and Tonic renaissance sweeping across Western Europe, with strong sales across Italy, Germany, Holland and Switzerland. • 23 countries representing 5% of total sales RoW • Main countries are Canada, Australia and Colombia • 8 new countries added in 2014 6

Financial review Income Statement (i) £m FY14 FY13* Growth • Revenue enue of of £34 34.7m Revenu enue 34.7 23.3 49% 49%  Growth of 49% on 2013 Gross profit fit 17.7 11.9 49% 49% • Gross ss profit fit margin gin of of 50 50.9% Gross margin 50.9% 51.0%  Margin maintained despite weakening of Euro and US Dollar in 2014 EBIT ITDA* A** 10.0 6.7 48% 48% • EBITDA DA of of £10 10m at at a margi rgin of of 28 28.8% EBITDA margin 28.8% 28.9%  Underlying operating expenses consistent with 2013 at 22.1% of revenue *Fevertree Drinks plc was incorporated in February 2013 and acquired the trading entity Fevertree Limited in March 2013. As such, the audited financial statements will present a 10 month period for the 2013 comparison. To allow meaningful comparisons to be made this presentation refers to the full year’s trading for 2013 as the comparison period, therefore including trading by Fevertree Limited in the 2 month period prior to its acquisition by Fevertree Drinks plc. **Pre-exceptional items 7

Financial review Income Statement (ii) £m FY14 FY13 • Except ptiona onal costs ts EBIT ITDA* A* 10.0 6.7  2014 costs were fees associated with the IPO Depreciation (0.1) <(0.1)  2013 costs related to the LDC investment Amortisation (0.7) (0.6) • Finan ance expe pense ses Exceptional costs (1.1) (3.1)  These include £5.1m of interest and arrangement fees relating to the investor loan Operating rating profit fit 8.1 3.0 notes which will be non-recurring Finance expenses (5.6) (4.1) • Tax Tax Prof ofit befo efore e Tax 2.5 (1.1)  Should revert to statutory levels in future Tax (1.2) (1.0) years Prof ofit after er Tax 1.3 (2.1) • EPS and dividend end  Normalised EPS of 6.46 pence in FY14 EPS (pence ce) 1.54 (3.26)  Proposed dividend of 0.30 pence per share in respect of the period from IPO to year end 8 *Pre-exceptional items

Financial review Cash flow £m FY14 FY13 • EBIT ITDA* A* 10.0 6.7 Operatin rating Cash flow  Working capital increased in line with Working Capital movement (2.7) (1.7) revenue Operating rating Cash flow 7.3 5.0 Conversion 73% 75% • On-goi On going ng cash flow Tax (1.2) (0.9)  Sub-heading included here to strip out the on-going cash flows from those relating to Capital expenditure (0.3) (0.2) exceptional costs, IPO fund raise and the pre- Bank loan interest and (0.7) (0.5) IPO structure repayment On On-goin going g Cash flow 5.1 3.4 Exceptional costs (1.1) (3.2) Loan note interest (1.1) (1.2) IPO Primary raise 4.0 - Other investing activities (50.0) (50.5) Other financing activities 49.4 50.7 Net Cash flow 6.3 (0.8) 9 *Pre-exceptional items

Financial review Balance sheet – net assets £m FY14 FY13 • Net cash of of £3.3m PPE 0.4 0.2  Cash of £9.6m offset by £6.3m of gross debt Intangibles 44.6 45.3 Stock 4.3 2.5 • Net asset et moveme ement nt  Receivables 8.4 6.0 Conversion of investor loan notes to equity pre-IPO Derivatives <0.1 <0.1 Cash 9.6 3.4 Creditors and (5.0) (3.7) provisions Gross debt (6.3) (52.5) Deferred tax (2.7) (2.7) Net Assets 53.3 (1.5) 10

Strategic opportunities for 2015 Capitalising on • Global premiumisation trend market trends • Drinks trends; Mixability, G&T, Moscow Mule etc Strengthening • Deepening distribution distribution in existing • Increased support markets • On-going review of international distribution partners Expanding • 50 territories worldwide, 35 of these are at very early stages distribution into new • Currently assessing growth opportunities in LatAm and Asia Pacific markets • Naturally light portfolio New product • Territory-specific flavours and formats development • Packaging refresh 11

Summary and Outlook • Excellent progress achieved during 2014 translated into strong revenue and profit growth • Strong premiumisation and drinks trends in Company’s favour • Our first mover advantage as the leading international premium mixer brand continues to present significant growth opportunities in both existing markets and through new geographies and products • Board confident in outlook for 2015 and beyond 12