FY18 RESULTS
28 February 2019, Istanbul
FY18 RESULTS 28 February 2019, Istanbul Forward-Looking Statements - - PowerPoint PPT Presentation
FY18 RESULTS 28 February 2019, Istanbul Forward-Looking Statements This presentation includes forward-looking statements including, but not limited to, statements regarding Coca-Cola eceks (CCI) plans, objectives, expectations and
28 February 2019, Istanbul
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.
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4,1% 20,8% 26,2% 6,3% 26,6% 35,7%
Volume Revenue EBITDA 2017 2018
Accelerating quality growth
10,4% 16,4% 11,8% 17,6%
EBIT Margin EBITDA Margin 2017 2018
642 729 730
2016 2017 2018
Accelerating quality growth Continued margin expansion Another year of solid FCF
Delivering on our guidance with strong financial performance
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Highest net revenue & EBITDA growth
Revenue Growth Management & effective hedging Focus on working capital and capex efficiency GROWTH YOY MARGIN % TL MILLION
1,4% 3,3% 4,8% 2016 2017 2018
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77 mn UC incremental
volume in 2018
3,2% 4,1% 6,3% 2016 2017 2018
TURKEY INTERNATIONAL CONSOLIDATED
29 mn UC incremental
volume in 2018
47 mn UC incremental
volume in 2018
5,2% 4,9% 7,8% 2016 2017 2018 UNIT CASE VOLUME GROWTH YOY
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SPARKLING STILLS WATER NRTD TEA
6.8%
11.6% 7.0% 6.0% 11.5%
% in Total Mix (2018)* 71% 7% 14% 9% 59 mn UC incremental Sparkling volume in 2018
TOTAL
0.6% 6.3% 4Q18 2018
UNIT CASE VOLUME GROWTH YOY
* Totals may not foot due to rounding differences
4,8% 6,1% 6,9% 18,7% 34,4%
Volume Volume (excl. NRTD Tea) Transactions (excl. NRTD Tea) Net Revenue EBITDA*
1,7% 5,7% 2016 2017 2018
Accelerating Volume Growth Increasing IC Share
20% 22% 23% 2016 2017 2018
Higher Share of Sugar Free**
5,3% 5,7% 6,8% 2016 2017 2018
…driven by Strong Sparkling momentum Highest volume growth in 7 years…
Above 30% volume growth in ‘Coca-Cola No Sugar’
2018 GROWTH YOY
* EBITDA excluding other operating income/expense * *Share of No Sugar & Light in Sparkling
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YoY % in Sparkling % in Sparkling
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7,3% 3,9% Pakistan Iraq Focus on efficiencies & core Sparkling 10th Year of Pakistan Operation
Sales Volume
(mn UC)
93 335
2008 2018
3.6x
Sparkling Market Share*
*Source: Canadean
Double-digit volume growth in Coca-Cola trademark Above- industry growth in Sparkling
Production Capacity (mn UC)
3.6x
112 408
2008 2018
+2 pp in 2018
2018 VOLUME GROWTH YOY
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14,1% 29,7% Kazakhstan Azerbaijan Double-digit volume growth in key markets Accelerating growth and gaining share
Azerbaijan
7,0% 12,7% 2016 2017 2018
Accelerating CA Volume Growth Gaining Market Share in Kazakhstan
49% 49% 51% 2016 2017 2018
Highest-ever sales volume in Kazakhstan Fuse tea reached #1 position in Kazakhstan Above 30% volume growth in Sparkling in Azerbaijan
Source: Nielsen
fastest growing country in TCCC system in 2018
2018 VOLUME GROWTH YOY
YoY
(TL million) 4Q18 YoY Change 2018 YoY Change Net Sales 2.001 22,9% 10.623 26,6% Gross Profit 573 10,7% 3.527 27,2% EBIT (17) (140,1%) 1.255 43,6% EBITDA 147 (13,4%) 1.871 35,7% Net Income / (Loss) 148 n.m. 327 37,5% GP Margin 28,6% (320 bps) 33,2% 20 bps EBIT Margin (0,9%) (350 bps) 11,8% 140 bps EBITDA Margin 7,4% (300 bps) 17,6% 120 bps EPS* 0,58 n.m. 1,28 37,5%
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*EPS in TL per 100 shares
Consolidated (TL), FX-Neutral
+6% +8% +20%
2,2 2,4
2017 2018
0,7 0,8
2017 2018 Strong topline growth in Turkey and Central Asia Higher NSR/UC in Turkey Effective cost management & hedging Increasing efficiency in Turkey and int’l
Net Sales Revenue per UC Gross Profit per UC EBIT per UC
6,8 7,2
2017 2018
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World Sugar Prices (London#5 Average, USD/tonne) Resin Prices (Average, USD/tonne) LME Aluminium Prices (Average, USD/tonne) Hedged Position for 2019*
100%** 66% 58%
*As of February 2019 **For unregulated markets
impact on input costs: Hard currency cash allocation for FX-denominated raw material purchases
2019 FX-denominated raw material purchases at USD/TRY 3.95
gains due to designation of cash
Managing FX exposure related to raw materials...
100 200 300 400 500 2017 2018 500 1000 1500 2000 2017 2018 500 1000 1500 2017 2018
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238 327 492 (101) (195) (54) (6) 10 (56)
2017 ∆ in EBITDA ∆ in D&A* ∆ in FX gain/ (loss) ∆ in other financial inc./ (exp.) ∆ in other inc./ (exp.) ∆ in minority ∆ in tax 2018
*Depreciation and amortization
TL million
Net Income 2018 vs. 2017
Net Investment Hedging provided TL 288 million positive impact on net income in 2018
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Accelerating quality growth Net Debt (USD mn) Net Debt / EBITDA Net Interest Coverage
2,1 1,5 1,4 2016 2017 2018
6,6 9,7 9,0
2016 2017 2018 652 555 500 2016 2017 2018 Continued deleveraging FX-Neutral Net Debt/EBITDA: ~1.2x Covenant < 3.25x Covenant > 4x Lower Net Interest Coverage due to cross-currency swap
USD 75% USD 33% Euro 23% Euro 21% 41%
Local Currency 2% Local Currency 5%
2017 2018
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Accelerating quality growth Breakdown of Consolidated Debt
Participating cross-currency swap transaction for USD 150 mn Net investment hedging for USD 281 mn Repayment of USD 100 mn USPP (May 2018) Repayment of USD 500 mn Eurobond (October 2018)
Cross- currency swap & Net Investment Hedging
Maturity Profile
19% 12% 2% 2% 15% 51%
2019 2020 2021 2022 2023 2024
USD 80 mn USPP USD 120 mn USPP USD 500 mn Eurobond
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Accelerating quality growth NWC / Sales CapEx / Sales
Efficient Net Working Capital Management Faisalabad Plant in Pakistan (April 2018) Accelerated cooler investments 7,4% 5,7% 4,5% 2016 2017 2018 7,3% 5,9% 8,1% 2016 2017 2018
Free Cash Flow Yield*
7,6% 8,2% 9,4% 2016 2017 2018 Higher FCF yield
*Based on year-end Mcap
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1 FX-Neutral: Using constant FX rates when converting country financial statements to TL.
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Delivered on our guidance with quality growth in 2018
CCI Investor Relations Tel: +90 216 528 4000 | Fax: +90 216 5107010 | CCI-IR@cci.com.tr | www.cci.com.tr