January, 2012 Disclaimer This presentation does not constitute an - - PowerPoint PPT Presentation

Davy Conference Davy Conference New York New York

January, 2012

Disclaimer

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This presentation does not constitute an invitation to underwrite, subscribe for, or otherwise acquire or dispose of any shares or other securities of C&C Group plc (the "Company"). The presentation contains forward-looking statements, including statements about the Company's intentions, beliefs and expectations. These statements are based on the Company's current plans, estimates and projections, as well as the Company's expectations of external conditions and events. Forward-looking statements involve inherent risks and uncertainties and speak only as of the date they are made. The Company undertakes no duty to and will not necessarily update any such statements in light of new information or future events, except to the extent required by any applicable law or regulation. Recipients of this presentation are therefore cautioned that a number of important factors could cause actual results or outcomes to differ materially from those expressed in any forward- looking statements. Past performance is no guide to future performance and persons needing advice should consult an independent financial adviser. Your attention is drawn to the risk factors set out at the end of this presentation. They are not set out in any particular order of priority. The risks described in this document, however, are not exhaustive and consequently do not necessarily comprise all those associated with the Company. There may be other risks which may have an adverse effect on the business, financial condition, results or future prospects of the Company.

Presentation Agenda

 Business Overview  C&C | Business Re-positioned  Financial Overview  Strategy & Outlook  Appendix

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Slide 4

Business Overview

Slide 5

Group Overview

 Manufacturer, marketer and distributor of branded Long Alcohol Drinks (“LAD”)

 World’s #2 cider producer  #1 premium cider brand in Ireland & the UK  #2 and #3 cider brands in the United States  Scotland’s #1 LAD brand

 Premium positioning in cider: a growing beverage category globally  12 Months to Feb 2011: Revenue €789.7 million; Net Revenue €529.6 million; EBITDA(i) €126.3 million  Consistently high free cash flow generation

• Free Cash Flow(ii): 84.6% of EBITDA in FY 2010/11; 92.5% in H1 2011/12

 Strong balance sheet

• H1 2011/12 Net Cash surplus of €59.7 million; Net Interest covered 26 times

(i) Earnings before exceptional items, interest, tax, depreciation & amortisation and inclusive of discontinued activities (ii) Free cash flow is a non-GAAP measure that comprises cash flow from operating activities net of capital investment cash outflows which form part of investing activities

Principal Cider Brands Other Assets

• Advances to customers
• Wellpark brewery
• Advances to customers
• Tennent’s wholesale

Scotland Northern Ireland Republic of Ireland England

• Shepton Mallet Cider

Manufacturing Facility

• Distribution Facility

C&C | Strong Brand Portfolio

• Clonmel Facility

International

Beer

Non-exclusive on-trade distribution rights

Packaged

Non-transnational on- and off-trade On- and Non-transnational off-trade distribution rights

Geographic Presence

Slide 7

Northern Ireland

Magners, Tennent’s & 3rd Party Brands

2010/11 FY | 16% of Net revenue; 10% of EBIT

Republic of Ireland

Bulmers, Tennent’s & 3rd Party Brands

2010/11 FY | 21% of Net revenue; 44% of EBIT

Scotland

Magners, Tennent’s & 3rd Party Brands

2010/11 FY | 59% of Revenue; 43% of EBIT*

England & Wales

Magners, Gaymers & Tennent’s

2010/11 FY | 59% of Revenue; 43% of EBIT*

Europe

Magners, Gaymers brands, Tennent’s

Australia

Magners, Gaymers brands & Tennent’s

*Note: Scotland and England & Wales combine to form Great Britain (GB) which comprised 59% of revenue and 43% of EBIT in 2010.11 FY

International

2010/11 FY | 4% of Revenue; 3% of EBIT

North America

Magners, Gaymers brands, Tennent’s & Hornsby’s

Clonmel Facility Shepton Mallet Facility Wellpark Facility

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Republic of Ireland | Cider

Source: ACNielsen Data to August 2011

ROI | On & Off Trade – Rolling MAT Volume Movement (%) for Bulmers and LAD category

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Great Britain | Cider

Source: ACNielsen & CGA Data to 6 August 2011 *Great Britain (‘GB’) includes Scotland, England and Wales

GB* | On & Off Trade – Rolling MAT Volume Movement (%) for Magners and Cider category

Slide 10

International Cider Markets

ROI 0.7m HLs ROI 0.7m HLs Rest of World 7.0m HLs Category Growth forecast: +10% to 20% pa Rest of World 7.0m HLs Category Growth forecast: +10% to 20% pa UK 9.5m HLs Category Growth forecast: +5% to 10% pa UK 9.5m HLs Category Growth forecast: +5% to 10% pa

Source: Euromonitor & Company Estimates (2010) HLs: Hectolitres

Slide 11

Business Re-positioned

2008 to 2011 | 3 Year Turnaround

▶ Stabilise Magners declining at c. 16% per annum in 2008 ▶ Consolidate ‘Mono Brand’ exposure ▶ Transform Market Risk exposure

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C&C Re-positioned | Stabilise

Ireland New pricing on Bulmers pint bottle and Bulmers draught Launch of Bulmers Pear, Bulmers Berry and new advertising Two operational cost reduction programmes Hold earnings Great Britain New Magners advertising Launch of Magners Pear, Magners Golden Draught and Magners Specials Re-structuring of Magners distribution and formation of cider sales force Scotland Launch of Magners Pear, Magners Golden Draught, Magners Specials & Caledonia Best Re-structuring of Magners distribution Cost and synergy delivery

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C&C Re-positioned | Consolidate

 Stabilise and consolidate position as LAD focused business in core markets  Focus on a cider led LAD strategy  Deleverage and reduce exposure to banks 3 Transformational Transactions  Acquisition of Tennent's and Gaymers for €268.6 million  Disposal of Spirits & Liqueurs for €300 million

€269m €49m €295m €17m

50 100 150 200 250 300 350

Consideration EBITDA Consideration EBITDA

Positive Impact on C&C

Net cash inflow

• c. €25m

Proforma EBITDA increase

• c. €32m

Tennent’s & Gaymers Spirits & Liqueurs

Slide 15

C&C Re-positioned | Transform

 Accelerate internationalisation of cider  New long term partnership arrangements in Australia & Canada  Investment in US sales & marketing infrastructure  Acquisition of Hornsby’s, number 2 domestic US cider brand  C&C becomes the number 2 cider company with an estimated 20% share in a rapidly growing US cider category (c. +20% per annum)  Hornsby’s complements Magners’ existing position in the US  Opportunity to grow Hornsby’s in the US and potential to develop export led growth of the brand Significant progress…..but internationalisation of cider is only beginning

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3 Year Transformation

 Business position strengthened in core markets  Operating cost base reduced; well-invested asset base  Broader portfolio of cider and beer brands  Continuing innovation  Significantly enhanced and growing international business  Consistently strong cash flow generation  Strong balance sheet

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Financial Overview

Slide 18

3 Year Financial Overview

 Consistently strong cash flow generation capability

(i) Net Revenue is revenue less excise duties for activities reported as continuing at the date of reporting (ii) EBITDA is earnings before exceptional items, interest, tax, depreciation & amortisation and includes discontinued activities. EBITDA margin relates to continuing activities (iii) Net debt excludes fair value of SWAP instruments (iv) Calculated in accordance with the Committed Revolving Facility agreement (May 2007)

Cash Generative Business  Bank Debt Facility: €185 million, Drawn: €75 million, Maturity: May 2012. Net Cash surplus: €59.7million - 31 Aug 11  Low effective tax rate (forecast c. 15% per annum)  Low capex requirements: well-invested asset base  Manageable pension deficit (€23.7m at 31 August 2011)

Financial Year Net Revenue (i) €m EBITDA(ii) €m EBITDA (iii) Margin % Free Cash Flow (FCF) €m FCF % of EBITDA Net Debt(iii) €m Net Debt to EBITDA (iv) 2008/09 FY 415.6 119.9 28.8% 76.1 63.5% (226.2) 1.9x 2009/10 FY 362.7 106.3 25.1% 109.9 103.4% (364.9) 2.8x 2010/11 FY 529.6 126.3 23.0% 106.8 84.6% (6.3) 0.07x 2011/12 H1 268.7 77.3 28.8% 71.5 92.5% 59.7 N/A

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2011/12 H1 | Financial Highlights

 Operating profit up 7.8% to €67.4m  Operating margin improved by 3.1ppts to 25.1%  Strong free cash flow of €71.5m (92.5% of EBITDA)  Net cash surplus of €59.7m  Adjusted diluted EPS increased 7.1% to 16.5 cent  Dividend increase of 11% to 3.67 cent per share  Re-affirming operating profit guidance range of €108m to €115m for 2011/12 full year

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H1 | Business Segments

• Republic of Ireland (ROI) | Constant Currency

Cider ROI H1

FY12

Change

Const Curr.

Net revenue €53.2m (8.4%) Operating profit €26.3m (4.7%) Operating margin 49.4% +1.9ppts Volumes khl 303 (3.2%)

 LAD category volume decline of 2%  Improved brand health scores  Increased off trade promotional activity driving pricing deflation  Supply chain cost & efficiency savings  Growth of Tennent’s & Becks Vier  Incremental contribution offsetting cider decline Beer ROI H1

FY12

Change

Const Curr.

Net revenue €5.3m +15.2% Operating profit €1.2m

• Operating margin

22.6%

• Volumes khl

46 +22.8% ....earnings from ROI are in line with last year

Magners H1

FY12

Change

Const Curr.

Net revenue €63.8m (2.3%) Operating Profit €14.8m (21.3%) Operating Margin 23.2% (5.6ppts) Volumes khl 468 +2.9%

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H1 | Business Segments

• Cider Great Britain (GB) | Constant Currency

Gaymers H1

FY12

Change

Const Curr.

Net revenue €38.5m (20.9%) Operating Profit €3.8m +171.4% Operating Margin 9.9% +7.0ppts Volumes khl 681 (27.3%)

 Magners gains share in H1  Volume growth of 33% in multiple grocers with slight growth in unit pricing  New entrants and category shift to premiums  Front end loading of marketing activity  Pursuit of value over volume in Gaymers  Synergy benefits delivered  Reallocation of some marketing investment to support Magners

H1 | Business Segments

• Cider Export | Constant Currency

Magners Export H1

FY12

Change

Const Curr.

Net revenue €14.2m +19.3% Operating profit €3.0m +66.7% Operating margin 21.1% +6.0ppts Volumes khl 83 +22.7%

 Magners North America Volume growth: +14% USA:

+7% Canada: +80%

 New long term partnership arrangements in Australia & Canada  Expanded infrastructure in USA  High levels of marketing investment  Launch of Tennent’s in Canada & Australia  Growth in category interest world-wide  Gaymers exports contributed €0.8m of operating profit  Magners Australia Volume growth: +100%

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H1 | Business Segments

• Beer | Constant Currency

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Tennent’s H1

FY12

Change

Const Curr.

Net revenue €50.9m (5.7%) Operating profit €12.8m +43.8% Operating margin 25.1% +8.6ppts Volumes khl 753 (8.2%)

3rd Party Brands H1

FY12

Change

Const Curr.

Net revenue €39.5m +6.2% Operating profit €3.8m +216.7% Operating margin 9.6% +6.4ppts Volumes khl 202 (1.8%)

 On trade share growth in Scotland and NI  Pursuit of value ahead of volume in the off trade  Strengthening brand health scores  Full delivery on synergies  Growing third party contract activity benefit  Increased level of lending activity  Growth in ROI  Portfolio benefit of a strong Tennent’s brand  Contractual adjustment to royalty rates - improves sustainable margins

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H1 | Operations

Activity

 Increased third party contract packaging activity  Relocation of Bottling line to Wellpark Brewery  Outsourcing of technical services in GB  Synergy plan delivery  Ongoing cost and efficiency savings  Managed input cost inflation to low single digit

Future Focus

 Group logistics and distribution footprint  Further third party contract activity

….scope to minimise impact of future input cost inflation

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Net Cash & Pension

• Strong Free Cashflow | Strong Balance Sheet

** Deferred tax asset of €2.8 million reduces deficit to €20.9 million at 31 August 2011 (31 August 2010 €6.4million reduces deficit to €43.3million and 28 February 2011 €2.0 million reduces deficit to €13.3million)

€m

Defined Benefit Pension Deficit**

31 August 2010: €49.7m 28 February 2011: €15.3m 31 August 2011: €23.7m

*Excludes fair value of swap instruments amounting to a liability of €1.5 million (February 2011: €2.0m)

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Strategy & Outlook

International Cider Markets

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Source: Euromonitor & Company Estimates (2010) HLs: Hectolitres

ROI 0.7m HLs ROI 0.7m HLs Rest of World 7.0m HLs Category Growth forecast: +10% to 20% pa Rest of World 7.0m HLs Category Growth forecast: +10% to 20% pa UK 9.5m HLs Category Growth forecast: +5% to 10% pa UK 9.5m HLs Category Growth forecast: +5% to 10% pa

10 11 12 13 14 15 16 17 18 19 20 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Attractive global growth

Official Cider category growth forecasts

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Source: Euromonitor Million hectolires

%

Source: Old & New Alcovision – rolling MATs – % of total trade volume (serves) in UK Cider’s ‘share of throat’ amongst 18-24s in UK has grown steadily from 2006 onwards, whilst Lager (Draught and Bottled in particular) has declined.

Cider |Long term growth potential

Category share of 18-24 year old Alcohol Consumption

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International Opportunity

 Unisex  Natural Fruit Flavours  Versatile

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(Alcovision last 7 day volume total trade – defined ‘Sweet’ includes RTDs/FABs, Cider and any Spirit drunk with a ‘sweet’ mixer)

Migration to Fruitiness

% Sweet Serves in Total Alcohol Consumption: Total Trade 18% 22% 30% 39% 2001 2010

All Adults 18-24yr olds

Cider can capture 5% to 10% of most LAD markets

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Opportunity & Potential  Long term consumer led category growth  Strong market positions Capability  Debt free  Cash generative  Strength of the brands  Proven M&A capability  Integration and operational capability  Experienced management team Cash utilisation guided by Total Shareholder Return philosophy

Financial & Operational Capability

• to fulfil long-term ambitions

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C&C Group | Investment Thesis

 Focused LAD business with strong market positions  Leading player in growing global cider category  Strong earnings and consistently high cash generation  Experienced management team with proven M&A, integration & operating capability  Financial capacity to accelerate international growth

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Appendix

 Competitive threat  Shift from on to off-trade  Cider duty risk  Exchange rate risk  Deteriorating business conditions in core markets

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Risk Factors

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2011/12 H1 Segmental Analysis

• Constant Currency

Net Revenue €m H1 2011/12 H1 2010/11 Change

Cider ROI 53.2 58.1 (8.4%) Cider NI 6.8 7.0 (2.9%) Cider GB 102.3 114.0 (10.3%) Cider Export 16.0 13.5 18.5% Tennent's 50.9 54.0 (5.7%) Third party brands 39.5 37.2 6.2% Total continuing 268.7 283.8 (5.3%)

Operating Profit €m H1 2011/12 H1 2010/11 Change

Cider ROI 26.3 27.6 (4.7%) Cider NI 2.1 2.0 5.0% Cider GB 18.6 20.2 (7.9%) Cider Export 3.8 2.6 46.1% Tennent's 12.8 8.9 43.8% Third party brands 3.8 1.2 216.7% Total continuing 67.4 62.5 7.8%

Note: Operating profit after allocation of Group overheads

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2011/12 H1 Cashflow

H1 2011/12 H1 2010/11 Change €m €m EBIT 66.8 67.9 (2%) Amortisation/depreciation 10.5 10.9 (4%) EBITDA 77.3 78.8 (2%) Net finance charges/taxation (2.1) (7.5) (72%) Changes in working capital 8.5 38.8 (78%) Exceptional items (6.7) (4.5) 49% Operating cashflow 77.0 105.6 (27%) % of EBITDA 99.6% 134% Capex (5.5) (11.8) (53%) % of depreciation 52% 108% Free cash flow 71.5 93.8 (24%) % of EBITDA 93% 119% Debt repayments / disposal proceeds (53.9) 54.0 Proceeds from share options 1.0 0.4 Dividends paid (9.6)

• Net cash movement

9.0 148.2

www.candcgroupplc.com www.candcgroupplc.com

C&C Group plc C&C Group plc Block 71 Block 71 The Plaza, Parkwest Business Park, The Plaza, Parkwest Business Park, Dublin 12 Dublin 12 Ireland Ireland Tel: +353 1 616 1100 Tel: +353 1 616 1100