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Interim Results Six months ended 30 September 2014 28 November - PowerPoint PPT Presentation

Interim Results Six months ended 30 September 2014 28 November 2014 Franois Hriard Dubreuil Chairman Mid- to Long-Term Value Creation Strategy Continued move upmarket of our portfolio Investing to nurture future growth:


  1. Interim Results Six months ended 30 September 2014 28 November 2014

  2. François Hériard Dubreuil Chairman

  3. Mid- to Long-Term Value Creation Strategy ■ Continued move upmarket of our portfolio ■ Investing to nurture future growth: ■ Marketing investment prioritisation and targeted innovation ■ Strengthening of the network in key markets ■ Expansion into new high-potential territories ■ Strict cost and cash control 3 Interim Results at 30 September 2014

  4. Key Figures (6 months to 30 September 2014) Change Published Organic (**) ■ Sales €471.8m (15.5%) (5.6%) € 406.3m (9.2%) (7.4%) of which own brands ■ Current operating profit €102.1m (23.1%) (14.6%) ■ Current operating margin 21.6% - - ■ Net profit (Group share) €62.7m (9.4%) ■ Net profit (excl. non-recurring items) €64.0m (25.1%) ■ Net earnings per share (Group share) €1.30 (7.2%) ■ Net earnings per share €1.33 (23.1%) (excl. non-recurring items) ■ Net Debt/EBITDA ratio: €3.14 (**) Organic growth is calculated based on 2013/14 pro forma figures and at constant exchange rates 4 Interim Results at 30 September 2014

  5. High Comparatives in H1 EMEA Americas Asia-Pacific Group 37% (11%) 9% 19.9% 19.5% 14.9% 8% 13.3% 5.4% 2.7% 2.8% (1.0%) (3.6%) (5.6%) (16.8%) (25.6%) H1 2014-15 (**) H1 2012-13 H1 2013/14 (**) Organic growth is calculated based on 2013/14 pro forma figures and at constant exchange rates 5 Interim Results at 30 September 2014

  6. Review of Activities Valérie Chapoulaud Floquet CEO

  7. Half-Year Trends in Line with our Full-Year Targets ■ 5.6% organic sales decline: ■ Slight sales growth outside Greater China (continued destocking effort) ■ Strong growth of Liqueurs & Spirits and Partner Brands ■ Solid current operating margin of 21.6%: ■ Continued destocking in Greater China and currencies both impacted H1 margin ■ Expansion of the distribution network into new markets ■ Marketing investment prioritisation; Strict control of holding company costs ■ Net margin (Group share) of 13.3%, up 160bps in organic terms 7 Interim Results at 30 September 2014

  8. Group Sales €m Published decline: 15.5% Published decline: 15.5% Edrington Currency contract Organic (**) impact (48.0) (5.6%) (1.9%) (7.5%) 558.0 510.0 471.8 Sept. 13 PF (*) Sept. 13 Sept. 14 (*) Pro forma 2013/14: excluding the contribution of the Edrington distribution contract in the US (which expired on 31 March 2014)) (**) Organic growth is calculated based on 2013/14 pro forma figures and at constant exchange rates 8 Interim Results at 30 September 2014

  9. Quarterly Organic Sales Growth (in organic terms) Q1 2013/14 Q2 2013/14 Q3 2013/14 Q4 2013/14 Q1 2014-15 Q2 2014-15 (2.3%) (**) (5.3%) (**) (5.5%) (5.7%) H1 2013/14: (3.6%) (**) H1 2014-15: (5.6%) (16.1%) (18.9%) H2 2013/14: (17.8%) (**) Organic growth is calculated based on 2013/14 pro forma figures and at constant exchange rates 9 Interim Results at 30 September 2014

  10. H1 Sales Growth by Product Division Rémy Liqueurs & Partner Group Martin Spirits Brands (5.6%) 6.8% (13.4%) 9.1% Organic (**) Published (40.7%) (15.5%) (15.4%) 7.6% (**) Organic growth is calculated based on 2013/14 pro forma figures and at constant exchange rates 10 Interim Results at 30 September 2014

  11. Breakdown of Sales by division by region €471.8m Americas Liqueurs & Partner 35% (+2pps) Spirits brands 27% (+4pps) 14% (+1pp) Europe/ Asia Middle East/ Pacific Africa 32% (-5pps) 33% (+3pps) Rémy Martin 59% (-5pps) Note: Percentage point changes calculated on a 2013/14 pro forma basis 11 Interim Results at 30 September 2014

  12. Breakdown of Sales by Geographic Region Rémy Martin Liqueurs & Spirits €276.8m €129.5m Americas Americas 38% (+3pps) Asia 34% (+1pp) Pacific Europe/ Middle East/ 10% (+1pp) Africa 15% (+1pp) Europe/Middle East/ Asia Pacific Africa 47% (-4pps) 56% (-2pps) Note: Percentage point changes calculated on a 2013/14 pro forma basis 12 Interim Results at 30 September 2014

  13. Current operating profit (€m) Published decline: 23.1% Published decline: 23.1% Edrington Volume/ Price / Currency contract Mix Mix A&P Other impact 10.3 (5.6) 3.6 (6.4) (7.8) (24.7) 132.7 127.1 102.1 down 14.6% in organic terms (**) (€25.0m) Sept. 13 PF (*) Sept. 13 Sept. 14 COP/Sales: 23.8% COP/PF Sales: 24.9% COP/Sales: 21.6% (org: 22.5 %) (*) Pro forma 2013/14: excluding contribution of the Edrington distribution contract in the US (full cost basis) (**) Organic growth is calculated based on 2013/14 pro forma figures and at constant exchange rates 13 Interim Results at 30 September 2014

  14. Net Profit (€m) Net profit excl. non-recurring items Net profit Group share Published (9.4%) Published (25.1%) up 5.7% in organic terms (**) down 13.7% in organic terms (**) 85,5 69.3 64,0 62.7 Sept. 13 Sept. 14 Sept. 13 Sept. 14 (**) Organic growth is calculated based on 2013/14 pro forma figures and at constant exchange rates 14 Interim Results at 30 September 2014

  15. Rémy Martin ■ Sales decline of 13.4% in organic terms (volumes down 6.0%) Revenues ■ Continue destocking in Greater China (in € millions) ■ Strategic withdrawal from the VS 450 20.1%* (10.4%)* (13.4%)* 26.5%* 376.1 category in the US 327.2 ■ 276.8 High comparison base in the Americas 277.3 300 region (up 25% in H1 2013/14) ■ Buoyant demand in the US, Central & 150 Eastern Europe and Africa 0 Sept 2011 Sept 2012 Sept 2013 Sept 2014 * In organic terms 15 Interim Results at 30 September 2014

  16. Rémy Martin New VSOP bottle ■ Strategy of moving our portfolio upmarket (1738 Accord Royal, Centaure) ■ Targeted innovation Cellar Master’s Selection for Travel Retail ■ Investment prioritisation ■ Consumer education Louis XIII Black Pearl (Anniversary Limited Edition) 16 Interim Results at 30 September 2014

  17. Rémy Martin Current operating profit (€m) Published decline: 32.8% Published decline: 32.8% Edrington Currency Volume/ Price/ contract impact Mix Mix A&P Other (3.8) (3.1) 9.7 3.4 (8.0) (36.2) 116.1 112.2 78.0 down 27.7% in organic terms (**) (€34.2m) Sept. 13 Sept. 13 PF Sept. 14 COP/Sales: 35.5% COP/PF Sales (*) : 34.3% COP/Sales: 28.2% (Org: 28.6 %) (*) Pro forma 2013/14: excluding contribution of the Edrington distribution contract in the US (full cost basis) (**) Organic growth is calculated based on 2013/14 pro forma figures and at constant exchange rates 17 Interim Results at 30 September 2014

  18. Liqueurs & Spirits ■ Sales growth of 9.1% in organic terms (volumes up 1.4%) ■ Cointreau Revenues (in € millions) - Solid growth in its major markets ■ Metaxa 6.5%* 3.5%* 10.2%* 9.1%* 150 - Double-digit growth 129.5 120.4 - Greece, Russia and Eastern Europe 112.3 102.1 ■ Mount Gay 100 - Sales consolidation (launch of Black Barrel last year) - Additional growth drivers 50 ■ Bruichladdich - Doubling of sales 0 - USA, Taiwan, UK and Travel Retail Sept 2011 Sept 2012 Sept 2013 Sept 2014 * In organic terms 18 Interim Results at 30 September 2014

  19. Liqueurs & Spirits Promotion of Cointreau Rickey in the US 360 degree partnership with Vogue Magazine Mount Gay Master Class Miguel Smith, International Brand Ambassador Bruichladdich Private Tasting Sessions Metaxa 12*: Olfactory Experience in Travel Retail 19 Interim Results at 30 September 2014

  20. Liqueurs & Spirits Current operating profit (€m) Published growth: 23.3% Published growth: 23.3% Edrington Currency Volume/ Price/ contract impact Mix Mix A&P Other 1.3 0.2 9.2 (1.8) (0.9) (3.1) 25.8 up 44.6% in organic terms (**) 20.9 20.0 up €5.8m Sept. 13 Sept. 13 PF Sept. 14 COP/PF Sales (*) : 16.6% COP/Sales: 17.4% COP/Sales: 19.9 % (Org: 22.0 %) (*) Pro forma 2013/14: excluding contribution of the Edrington distribution contract in the US (full cost basis) (**) Organic growth is calculated based on 2013/14 pro forma figures and at constant exchange rates 20 Interim Results at 30 September 2014

  21. Partner Brands ■ Sales growth of 6.8% in organic terms (**) (volumes up 40.5% (**) ) ■ Current operating profit: €3.9m, up 13.5% in organic terms (**) Revenues ■ Dynamism of the EMEA and Travel Retail (in € millions) regions 150 6.0%** 6.8%** ■ 9.1%** 4.1%** Decline in Champagne sales 110.5 (*) 107.4 ■ Strong growth of third-party brands 95.5 100 ■ 31 March 2014: End of the Edrington brands 65.5 distribution contract in the US 50 0 Sept. 2011 Sept. 2012 Sept. 2013 Sept. 2014 (**) 2014/15 organic growth is calculated based on 2013/14 pro forma figures and at (*) of which €48m attributable to Edrington US constant exchange rates 21 Interim Results at 30 September 2014

  22. Consolidated Interim Results Luca Marotta Chief Financial Officer

  23. Current Operating Profit Published Organic 2013 2014 change change (**) (€m) Sales 558.0 471.8 (15.5%) (5.6%) 344.2 301.0 (12.6%) (7.6%) Gross profit in % 61.7% 63.8% +210bps (140bps) Sales & marketing expenses (170.5) (162.0) (4.9%) (1.6%) Administrative expenses (41.6) (38.0) (8.6%) (8.8%) Other income & expenses 0.6 1.1 - - Current operating profit 132.7 102.1 (23.1%) (14.6%) 23.8% 21.6% Current operating margin (220bps) (240bps) (**) Organic growth is calculated based on 2013/14 pro forma figures and at constant exchange rates 23 Interim Results at 30 September 2014

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