INVESTOR PRESENTATION March 2019 PUBLIC
Forward-Looking Statements 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 facts. Forward- looking statements can generally be identified by the use of words such as “may,” “will,” “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
Agenda Overview of CCI FY18 Highlights Strategic Priorities Financial Highlights PUBLIC
Overview of Highlights CCI ✓ Proven track record of expansion & growth ✓ Robust performance across all key markets with solid topline growth ✓ Abundant potential in demographics ✓ Compelling NARTD* growth opportunity in our footprint ✓ Strategy, Execution and People to accelerate quality growth ✓ Disciplined financial management to deliver stakeholder value 4 *Non-alcohol ready-to-drink PUBLIC
Overview of We are the 6th Largest Bottler in the Coca-Cola CCI System, Operating in 10 Countries Overview KAZAKHSTAN • ~400 mn people • 26 production plants with 124 lines (2018) AZERBAIJAN • 1.5 bn UC (1) annual production capacity KYRGYZSTAN TURKEY TURKMENISTAN • TAJIKISTAN ~920 thousand sales points • 1.3 bn UC sales volume SYRIA IRAQ • $ 2.3 bn revenue & $ 395 mn EBITDA PAKISTAN JORDAN EBITDA Breakdown (2) Volume Breakdown (2) Revenue Breakdown (2) 8% 7% Sparkling Market Position 36% 21% Turkey Turkey #1 Turkey 44% 10% Pakistan #2 Pakistan 49% International Kazakhstan 12% #1 64% Kazakhstan Iraq #2 26% 23% Others Others 5 Figures reflect FY 2018 numbers unless otherwise stated PUBLIC (1) Unit case, 1 UC equals 5,678 liters (2) As of FY2018
Overview of We have a Successful Track Record of Growth CCI REVENUE VOLUME EBITDA 18% 12% 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 6 PUBLIC
FY18 2018 Highlights Highlights Delivering on our guidance with strong financial performance Accelerating quality growth Accelerating quality growth Continued margin expansion Another year of solid FCF GROWTH YOY MARGIN % TL MILLION 35,7% 729 730 26,6% 17,6% 26,2% 642 16,4% 20,8% 11,8% 10,4% 6,3% 4,1% Volume Revenue EBITDA EBIT Margin EBITDA Margin 2016 2017 2018 2017 2018 2017 2018 Highest Revenue Growth Management Focus on working capital and net revenue & EBITDA growth & effective hedging capex efficiency of the past 6 years 7 PUBLIC
FY18 Strong volume delivery in all major countries Highlights TURKEY INTERNATIONAL CONSOLIDATED 29 mn UC incremental 47 mn UC incremental 77 mn UC incremental volume in 2018 volume in 2018 volume in 2018 UNIT CASE VOLUME GROWTH YOY 7,8% 4,8% 6,3% 5,2% 3,3% 4,9% 4,1% 3,2% 1,4% 2016 2017 2018 2016 2017 2018 2016 2017 2018 8 PUBLIC
FY18 FY18 Volume growth Highlights UNIT CASE SPARKLING STILLS TOTAL WATER NRTD TEA VOLUME GROWTH YOY 4Q18 -2.2% -4.9% 7.0% 11.5% 0.6% 2018 6.8% 11.6% 6.0% -1.2% 6.3% % in Total 14% 7% 9% 71% Mix (2018)* 59 mn UC incremental Sparkling volume in 2018 9 PUBLIC * Totals may not foot due to rounding differences
FY18 Turkey: Quality growth maintained Highlights Highest volume growth in 7 years… …driven by Strong Sparkling momentum • Successful innovations and consumer promotions Increasing • Higher portfolio availability in growing channels Accelerating 34,4% IC Share Volume Growth • Focus on affordability YoY 5,7% • Accelerated cooler investment 23% 22% 20% 1,7% -1,8% 2016 2017 2018 2016 2017 2018 % in Sparkling 2018 GROWTH YOY 18,7% Higher Share of Above 30% Sugar Free** volume growth 6,8% in ‘Coca -Cola 5,7% 5,3% No Sugar’ 6,9% 6,1% 4,8% 2016 2017 2018 % in Sparkling Volume Volume (excl. Transactions Net Revenue EBITDA* NRTD Tea) (excl. NRTD Tea) * EBITDA excluding other operating income/expense 10 * *Share of No Sugar & Light in Sparkling PUBLIC
FY18 Middle East & Pakistan highlights Highlights 10 th Year of Pakistan Operation Focus on efficiencies & core Sparkling 2018 VOLUME GROWTH YOY Production Sales Volume Capacity (mn UC) (mn UC) 335 3.6x 7,3% 408 3.6x 93 112 Above- 2008 2018 2008 2018 industry growth in Sparkling 3,9% Sparkling Market Double-digit Share* volume growth in 42 % Coca-Cola trademark +2 pp in 2018 Pakistan Iraq *Source: Canadean 11 PUBLIC
FY18 Central Asia highlights Highlights Double-digit volume growth in key markets Accelerating growth and gaining share 2018 VOLUME GROWTH YOY Gaining Market Accelerating CA Share in Volume Growth Kazakhstan YoY 29,7% 12,7% 51% Above 30% 49% 49% 7,0% volume growth in Highest-ever -9,6% Sparkling in sales volume 2016 2017 2018 2016 2017 2018 Azerbaijan in Kazakhstan Source: Nielsen Fuse tea 14,1% Azerbaijan reached #1 position in 2 nd Kazakhstan fastest growing country in TCCC system in 2018 Kazakhstan Azerbaijan 12 PUBLIC
Strategic Priorities PUBLIC
Strategic Clear Strategic Framework Priorities Customer & Consumer Being the preferred partner of our Vision Values customers, offering our consumers a wide choice of products fit for every lifestyle and occasion Be the Best FMCG Company Across CREATE our Markets VALUE People Community Being a good Great place corporate citizen to work 14 PUBLIC
Strategic Strategic Priorities to Create Value Priorities Accelerate Win at the Exercise Financial Win with People Growth Point of Sale Discipline • Full-beverage portfolio • Increase outlet coverage • Productivity savings • Integrated Talent Strategy • Revenue Growth • Working capital • Increase cooler penetration • Leadership Development Management (RGM) improvements • Right Execution Daily • High Performing Team • Expand Sparkling & Stills • Healthy FCF • E-commerce • Increase frequency • Optimum leverage • Transformation to “ OnePeople ” • Future-proof RTM • Regional strategies • Effective FX management ONE C E CCI CI 15 PUBLIC
Strategic NARTD Value Growth Opportunity Priorities TOTAL NARTD INDUSTRY IN CCI COUNTRIES: $13BN (2018) INDUSTRY NARTD 29% VALUE GROWTH SPARKLING 51% +$4bn STILLS 9% 9% CAGR 2018- 2021E WATER 8% CCI Value Share Opportunity 16 Source: Nielsen, Canadean and internal estimates, data as of 2018 PUBLIC
Strategic More Room to Diversify Product Portfolio Priorities SHARE OF LOW/NO CALORIE IN SPARKLING VOLUME (2018) CATEGORY BREAKDOWN 27% 2018 Still 7% NRTD 16% Tea 9% Other 15% 2006 8% Water 7% 6% 6% 14% 4% 3% 2% 2% 1% 0,3% Sparkling 85% Sparkling 71% Increasing Household Double-digit growth in & Penetration No Sugar 17 PUBLIC
More Room to Grow … Strategic Priorities Share of Immediate Consumption (IC) Packages in Sparkling You oung Pop opula lation in CCI in I countries 59% ~60% ~60% ~2x higher 50% NSR per case ~1.5x 40% higher Teen Recruitment Opportunit ity! Gross Margin vs. 35% FC 28% 24% Asia North World Europe, Latin CCI Pacific America Average Middle America East and Africa 18 * Based on CCI analysis for Turkey operations PUBLIC
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