1 Investor Presentation January, 2020 PUBLIC PUBLIC
Forward-Looking Statements 2 This presentation includes forward-looking statements including, but not limited to, statements regarding Coca- Cola İçecek’s (“CCI”) plans, objectives, expectations and intentions and other statements that are not historical Forward-looking statements can generally be identified by the use of words such as “may,” “will,” facts. “expect,” “intend,” “estimate,” “anticipate,” “plan,” “target,” “believe” or other words of similar meaning. These forward-looking statements reflect the current views and assumptions of management and are inherently subject to significant business, economic and other risks and uncertainties. Although management believes the expectations reflected in the forward-looking statements are reasonable, at this time, you should not place undue reliance on such forward-looking statements. Important factors that could cause actual results to differ materially from CCI’s expectations include, without limitation: changes in CCI’s relationship with The Coca-Cola Company and its exercise of its rights under our bottler's agreements; CCI’s ability to maintain and improve its competitive position in its markets; CCI’s ability to obtain raw materials and packaging materials at reasonable prices; changes in CCI’s relationship with its significant shareholders; the level of demand for its products in its markets; fluctuations in the value of the Turkish Lira or the level of inflation in Turkey; other changes in the political or economic environment in Turkey or CCI’s other markets; adverse weather conditions during the summer months; changes in the level of tourism in Turkey; CCI’s ability to successfully implement its strategy; and other factors. Should any of these risks and uncertainties materialize, or should any of management’s underlying assumptions prove to be incorrect, CCI’s actual results from operations or financial conditions could differ materially from those described herein as anticipated, believed, estimated or expected. Forward-looking statements speak only as of this date and CCI has no obligation to update those statements to reflect changes that may occur after that date. 2 PUBLIC PUBLIC
3 Agenda Overview of CCI 4 2019 Volume Performance 11 9M19 Financial Highlights 18 Strategic Priorities 21 Financial Highlights 29 Sustainability 41 Appendix 60 PUBLIC PUBLIC
4 Agenda Overview of CCI PUBLIC PUBLIC
We have the capabilities for Overview of CCI further growth 5 Proven track record of expansion & growth in emerging markets Presence in large and growing markets, compelling NARTD* growth opportunity in our footprint Abundant potential in demographics Strategy, Execution and People to accelerate quality growth Disciplined financial management to deliver stakeholder value Strong System alignment and unique long-term relationship with TCCC 5 *Non-alcohol ready-to-drink PUBLIC PUBLIC
We are the 6th largest bottler in the Overview of CCI Coca-Cola System 6 KAZAKHSTAN • 10 countries, ~400 mn people • 26 production plants with 124 lines AZERBAIJAN • 1.5 bn UC (1) annual production capacity KYRGYZSTAN TURKEY TURKMENISTAN TAJIKISTAN • ~920 thousand sales points SYRIA • 1.3 bn UC sales volume IRAQ • PAKISTAN $ 2.3 bn revenue & $ 395 mn EBITDA JORDAN Revenue Breakdown (2) EBITDA Breakdown (2) Volume Breakdown (2) Sparkling Market Position 7% 8% #1 Turkey Turkey 20% #2 Pakistan Turkey 52% Pakistan 11% 47% 48% #1 49% Kazakhstan Kazakhstan 14% International #2 Iraq Others 25% Others 19% 6 Figures reflect FY 2018 numbers unless otherwise stated PUBLIC PUBLIC (1) Unit case, 1 UC equals 5,678 liters (2) As of 9M19
…with a s uccessful track record of Overview of CCI growth 7 VOLUME REVENUE EBITDA 12% 18% 19% 10x 9x 4x CAGR 2005-2018 CAGR 2005-2018 CAGR 2005-2018 Single country in Expanding into Central Asia and JV in Pakistan in South Iraq in A regional bottler 2005 … North Iraq in 2006-2007 … 2012… today … 2008... 318 mn UC 1,315 mn UC 7 PUBLIC PUBLIC
Rising performance… Overview of CCI 8 Growth TL million 36% 27% 26% 21% 18% 17% 729 730 642 13% 6% 4% - CAGR (2005-16) 2017 2018* Cumulative 2016 2017 2018 Volume NSR EBITDA 2005-2015 2018: Highest net revenue & EBITDA growth 2018: Highest free cash flow of the past 6 years 8 *Includes TFRS 15 adjustments PUBLIC PUBLIC
…with the right focus Overview of CCI 9 Right Price Right Mix Regional Strategies IC Portfolio Availability Effective discount and trade Optimum price/pack architecture promotion management NSR > PCE growth IC Share ↑ 6 pts in Turkey (9M19 vs 2014 YE) Right Channel Right Portfolio Channel prioritization Portfolio expansion Clear channel roles & objectives Portfolio innovation Segmented execution Portfolio diversification 9 PUBLIC PUBLIC
…and excellence in e xecution Overview of CCI 10 Time in Field* Outlet Coverage (as of Sep ’19) (as of Sep ’19) 79% 88% +4pts vs 2015 +10pts vs 2015 Call Completion Rate** Strike Rate*** (as of Sep ’19) (as of Sep ’19) 92% 72% +7pts vs 2015 Superior +10pts vs 2015 ~142K new Over Execution: placements 1 million Be Available, in 4 years coolers Be Cold, (as of Sep’19) Be Visible *Time in Field: Percentage of time spent on the field vs. total working hours **Call Completion Rate: Percentage of realized visits vs. planned ***Strike Rate: Percentage of invoiced customers vs. planned 10 PUBLIC PUBLIC
11 Agenda 2019 Volume Performance PUBLIC PUBLIC
2019 2019 Consolidated Volume Highlights Highlights 12 Volume (mn UC) 1,316 4Q19 YoY Growth 4Q19: 230 Core Business Volume (mn UC) 6,5% Cycling 0.6% in 1,207 4Q18 2,4% 4Q19: 203 0,8% Turkey Volume (mn UC) 662 Volume Core Business 1 Transactions (excl NRTD Tea) 4Q19: 126 2019 YoY Growth Turkey Core Business Volume (mn UC) Cycling 554 6.3% in 2018 2,7% 4Q19: 99 0,6% 0,1% International Volume (mn UC) 1 654 Volume Core Business Transactions 4Q19:104 12 1 Co re business will relate to CCI’s business excluding non -ready-to- drink (‘NRTD’) Tea distribution PUBLIC PUBLIC
Category volume performance 2019 Highlights 13 Share in total volume (12M19) 7% 8% 14% 71% Growth yoy 4Q: 4.9% 12M: 0.3% 4Q: 14.5% 12M: 5.1% 4Q: 13.0% 12M: 0.1% 4Q: 9.2% 12M: 4.9% SPARKLING STILLS WATER NRTD TEA • Cycling 6.8% growth in • Cycling 11.6% growth in • Cycling -1.2% decline in • Cycling 6.0% growth 12M2018 12M18 12M18 in 12M18 • Growth in all markets • Ice Tea growth in all except Pakistan, Jordan markets & Turkmenistan 13 PUBLIC PUBLIC
2019 Country Volume Performance Highlights 14 Growth YoY -4.8% -15.2% 16.2% 4.9% -3.6% 4Q19 0.8% 2019 -7.8% 13.9% 1.8% -1.5% 8% 50% 50% 23% 11% 14 PUBLIC PUBLIC
2019 Turkey: Solid Performance in 2019 Highlights 15 4Q19 YoY Growth 18,1% Favorable sales mix with a higher IC share in Sparkling → +2 pp yoy increase in 2019 9,7% 6% increase in Low/No Sugar in 2019 4,9% 31.1% growth in Low/No Sugar in 4Q19 50% growth in Ice Tea category in 4Q19 1 Volume Core Business Transactions (excluding NRTD Tea) On-premise channel supported volume growth 2019 YoY Growth throughout 2019 7,1% Cooler placements, continued media 3,2% 1,8% investments and successful market execution 1 Volume Core Business Transactions (excluding NRTD Tea) 15 PUBLIC PUBLIC
2019 Central Asia: Continued growth in Highlights 16 markets ▪ Growth in all markets except Turkmenistan ▪ New year consumer promotions and successful consumer UC Volume Growth yoy activities ▪ Strong consumer activations, cooler placements and successful market execution in Kazakhstan ▪ Double-digit growth in Kazakhstan, Azerbaijan and 17.4% Tajikistan markets in 4Q19 excl Turkmenistan 14.4% 37% excl Turkmenistan 21% 16% 14% 11% 9% 4Q19 12M19 4Q19 12M19 4Q19 12M19 Kazakhstan Azerbaijan Central Asia 16 PUBLIC PUBLIC
2019 Pakistan and Middle East: Challenging Highlights 17 macro conditions ▪ Weak macroeconomic condition and tough competitive UC Volume Growth yoy environment impacting the growth ▪ Trademark Coca-Cola outperformed its segment on the back of higher brand love score 1% 4Q19 4Q19 12M19 ▪ 12M19 Strong Sparkling category in Iraq with 6% growth in 4Q19 -5% ▪ -8% 8% growth in trademark Coca-Cola in 4Q19 in Iraq ▪ In Jordan, 7.3% growth in 4Q19 supported by new cooler -15% placements Pakistan Iraq 17 PUBLIC PUBLIC
18 Agenda 9M19 Financial Highlights PUBLIC PUBLIC
9M19 3Q19 Highlights Highlights 19 Volume (mn UC) 413 3Q19 YoY Growth 9M19: 1,086 Net Sales Revenue (TL mn) excl 3,908 7,2% NRTD Tea 6,4% -3.4% 0,3% 9M19: 10,025 EBITDA Margin -1,0% Volume Transactions Net Sales EBITDA 22.3% 9M19: 20.1% 9M19 YoY Growth Earnings per share (TL) 2.19 excl 16,3% NRTD Tea 14,4% 18X 0.2% 9M19: 3.79 1,9% FCF (TL mn, 9M19) -0,1% 895 Volume Transactions Net Sales EBITDA 3% 9M18: 872 19 PUBLIC PUBLIC
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