RESULTS PRESENTATION
2014 FOURTH QUARTER AND FULL YEAR
18 February 2015
Forward looking statements
Unless otherwise indicated, the condensed consolidated financial statements and the financial and operating data or other
information included herein relate to Coca-Cola HBC AG and its subsidiaries (“Coca-Cola HBC” or the “Company” or “we”
or the “Group”).
This document contains forward-looking statements that involve risks and uncertainties. These statements may generally,
but not always, be identified by the use of words such as “believe”, “outlook”, “guidance”, “intend”, “expect”, “anticipate”,
“plan”, “target” and similar expressions to identify forward-looking statements. All statements other than statements of
historical facts, including, among others, statements regarding our future financial position and results, our outlook for
2015 and future years, business strategy and the effects of the global economic slowdown, the impact of the sovereign
debt crisis, currency volatility, our recent acquisitions, and restructuring initiatives on our business and financial condition,
our future dealings with The Coca-Cola Company, budgets, projected levels of consumption and production, projected raw
material and other costs, estimates of capital expenditure, free cash flow, effective tax rates and plans and objectives of
management for future operations, are forward-looking statements. You should not place undue reliance on such forwardlooking statements. By their nature, forward-looking statements involve risk and uncertainty because they reflect our
current expectations and assumptions as to future events and circumstances that may not prove accurate. Our actual
results and events could differ materially from those anticipated in the forward-looking statements for many reasons,
including the risks described in the U.K. Annual Financial Report for Coca-Cola HBC AG and its subsidiaries for the year
ended 31 December 2013.
Although we believe that, as of the date of this document, the expectations reflected in the forward-looking statements are
reasonable, we cannot assure you that our future results, level of activity, performance or achievements will meet these
expectations. Moreover, neither we, nor our directors, employees, advisors nor any other person assumes responsibility
for the accuracy and completeness of the forward-looking statements. After the date of the condensed consolidated
financial statements included in this document, unless we are required by law or the rules of the UK Financial Conduct
Authority to update these forward-looking statements, we will not necessarily update any of these forward-looking
statements to conform them either to actual results or to changes in our expectations.
2
2
Fourth quarter and full-year highlights
●
Volume improvement in the quarter, resulting in better than expected
full-year volumes
●
Market share gains
●
Increase in FX-neutral revenue per case for the 14th consecutive
quarter
●
Gross profit margin growth in both periods, supported by successful
revenue growth management and favourable input cost environment
●
EBIT margin broadly stable in the full year, despite significant volume
deleverage, higher concentrate costs and strong FX headwinds,
particularly in Q4
●
Further improvement in working capital position
●
Dividend proposal for €0.36
3
Financial
review
Michalis Imellos
Chief Financial Officer
Financial performance overview
Q4’14
Q4’13
Ch.
FY’14
FY’13
Ch.
485
481
0.8%
2,003
2,061
-2.8%
1,510
1,575
-4.1%
6,510
6,874
-5.3%
3.11
3.05
2.0%
3.25
3.17
2.5%
Comparable Gross Profit Margin
34.3%
34.1%
20bps
35.7%
35.5%
20bps
Comparable OPEX % NSR
30.5%
29.8%
75bps
29.2%
28.9%
30bps
Volume (m u.c.)
Net Sales Revenue (€m)
Currency-neutral NSR per case (€)
Financial indicators on a comparable basis exclude the recognition of restructuring costs, unrealised commodity hedging results and non-recurring items.
5
Financial performance overview
Q4’14
Q4’13
Ch.
FY’14
FY’13
Ch.
57
68
-16.7%
425
454
-6.4%
3.8%
4.3%
-50bps
6.5%
6.6%
-10bps
30
34
-11.4%
277
293
-5.4%
Comparable EPS (€)
0.08
0.09
-11.7%
0.76
0.81
-5.6%
Free Cash Flow (€m)
-12
68
n/a
333
413
-19.4%
Comparable EBIT (€m)
Comparable EBIT Margin
Comparable Net Profit (€m)
Financial indicators on a comparable basis exclude the recognition of restructuring costs, unrealised commodity hedging results and non-recurring items.
6
14th consecutive quarter of growth in
currency-neutral net sales revenue per case
Q4’14
FY’14
Volume
0.8%
-2.8%
Currency-neutral revenue per case
2.0%
2.5%
-2.8%
-5.4%
3.1%
1.5%
Volume
1.4%
-6.0%
Currency-neutral revenue per case
0.4%
2.8%
Volume
2.8%
-
Currency-neutral revenue per case
3.0%
3.5%
Total CCH
Established Markets
Volume
Currency-neutral revenue per case
Developing Markets
Emerging Markets
7
Favourable input cost environment
●
Currency-neutral input cost per case decreased by
high single digits in the quarter and mid single digits
in the full year
●
EU sugar costs continued to decrease year on year
●
World sugar costs remained on a downward trend
●
PET resin costs decreased significantly year on year
8
Efficiency improvements impacted by
marketing investment and certain one-offs
Net Sales Revenue (€m)
Comparable Operating Expenses (€m)
Comparable OPEX as % of NSR
Comparable EBIT Margin
Q4’14
Q4’13
Ch.
FY’14
FY’13
Ch.
1,510
1,575
-4.1%
6,510
6,874
-5.3%
461
469
-1.7%
1,901
1,987
-4.3%
30.5%
29.8%
75bps
29.2%
28.9%
30bps
3.8%
4.3%
-50bps
6.5%
6.6%
-10bps
Financial indicators on a comparable basis exclude the recognition of restructuring costs, unrealised commodity hedging results and non-recurring items.
9
Mixed segmental trends in comparable
operating profit, driven by FX
Q4 comparable EBIT
Total CCH
-€11m
Established
€3m
Developing
€3m
Emerging
-€17m
-20
-10
0
Q4’14
Q4 ‘13
57
68
17
14
3
0
37
54
10
Financial indicators on a comparable basis exclude the recognition of restructuring costs, unrealised commodity hedging results and non-recurring items.
Certain differences in sums are due to rounding.
10
Restructuring update
2014 recap
●
We incurred €31m in pre-tax restructuring costs in the
fourth quarter
●
For the full year, we incurred pre-tax restructuring costs of €62m
●
Annual restructuring benefits amounted to €35m in 2014
FY 2015 targets
●
We expect total pre-tax restructuring charges to amount to
€45m in 2015
●
Total annualised benefits from 2015 initiatives are expected at
c.€30m
●
Savings in 2015 from 2014 and 2015 initiatives are expected to
reach €44m
11
Solid free cash flow generation in the full year
€m
EBITDA
Cash from Working Capital
Net Capital Expenditure
Free Cash Flow
FY’14
FY’13
Ch.
742
756
-14
15
99
-84
-354
-372
19
333
413
-80
Free cash flow expectation for the 2013-2015 period revised to €1.1-1.2bn,
due to acceleration of the adverse currency movements
Differences in the absolute year-on-year change are due to rounding
12
Diversified financial profile
Debt maturity portfolio
€800m
€600m
$400m
2015
September
2016
November
2020
June
13
2015 Financial Outlook
Drivers of comparable EBIT
Volume
Revenue
incl. pricing
net of concentrate
Input costs
Self-help
FX
●
Positive EBIT contribution from volume leverage
●
Revenue growth management initiatives, including pricing, to increase the top line
●
Input costs to remain a tailwind
●
Self-help initiatives to reduce cost base
●
FX expected to remain a significant headwind at current spot rates
●
Overall, we expect our combined initiatives to help mitigate the FX impact
Not to scale
14
2015 – Management of foreign currency
movements
Scenario 1
FX deteriorates from current spot rates
Scenario 2
FX improves from current spot rates
Unfavourable FX movement
Favourable FX movement
Currency depreciation linked to the oil
price Oil-linked input costs improve
Currency appreciation linked to the oil
price Oil-linked input costs deteriorate
Additional pricing action in countries
with currency depreciation
Additional investment in the market
to fuel growth
Price elasticity of demand - Adverse
impact of pricing on volume
Favourable volume impact as a
result of additional marketing
investment
Self help intensified
Self help moderated
15
Operational
review and
strategy
Dimitris Lois
Chief Executive Officer
Sequential improvement in volume trends
in all segments in the quarter
Q4 volume by segment
+1%
481 m u.c.
+3%
485 m u.c.
-3%
Q4' 13
Established
Developing
Emerging
Q4 '14
17
All categories gained pace
in the quarter
Year-on-year growth
Q4’14
FY’14
0%
-3%
Trademark Coca-Cola
0%
-3%
Coca-Cola Zero
8%
6%
10%
5%
19%
12%
Water
1%
-2%
Energy
0%
1%
-3%
-7%
Sparkling
Juice
Multon
Tea
18
Established markets
Gradual deceleration of negative volume trends
Trademark
Coca-Cola
Coca-Cola
Zero
-6%
+3%
+
Water
-2.5%
Italy
Greece
Switzerland
10% volume decline
Volume growth (+2%)
following five years of
decline
7% volume decline
Challenging
underlying economic
and trading
environment and
tight liquidity in the
trade
Stable share
Water was the key
growth category
Underlying
macroeconomic and
trading environment
remains fragile
Deceleration in the
negative trends in
the quarter
Good share gains
Volume
-5%
Currencyneutral net
sales revenue
per case
+1.5%
All figures refer to full-year 2014, unless otherwise stated
19
Developing markets
Focus on value
Trademark
Coca-Cola
Coca-Cola
Zero
-3%
+6%
Water
-8%
Poland
Hungary
Czech Republic
Volume declined by 7%
Volume declined by
1%
Volume declined by
11%; across all key
categories except
Juice
Positive volume in the
quarter
Our value-accretive
volume initiatives
contributed to the
decline, while supporting
good NSR/case growth
Volatile
performance yet on
decelerated pace
Early signs of
stabilisation
Volume was stable in
the quarter
Increased competitive
pressure negatively
impacted volume
Volume
-6%
Currencyneutral net
sales revenue
per case
+3%
All figures refer to full-year 2014, unless otherwise stated
20
Emerging markets
Stable performance in a volatile environment
Trademark
Coca-Cola
Stable
Juice
+9%
Water
-1%
Russia
Nigeria
Romania
Volume at +1%, in a
volatile year
Volume at +4%;
maintaining good
momentum in Q4
Volume at -6%
Trading environment
remains competitive
Good growth in Water
+7% & Sparkling +4%
Juice continued to grow
strongly; Sparkling
declined by 6%
Coke grew by 1%,
Juice by 12%
Share Gains
Cautious outlook
Nigeria to remain a
key growth engine
Share gains
Volume
stable
Currencyneutral net
sales revenue
per case
+3.5%
All figures refer to full-year 2014, unless otherwise stated
21
Looking ahead
In 2015 we will continue to pursue our strategy to
●
exploit volume leverage supported by
favourable country mix
●
expand market leadership in both Sparkling
and NARTD
●
implement revenue growth management
initiatives driven by our focus on OBPPC,
single-serve packages as well as pricing mainly
to address significant currency headwinds
●
continue with our proven self-help measures
We expect materially reduced input costs to
mitigate the remaining negative impacts of FX
volatility and the related uncertainty in some key
markets.
We anticipate a challenging year and are optimistic that our business
will prove its strengths in adversity
22
Q&A
For further information on Coca-Cola
Hellenic please visit our website at:
WWW.COCA-COLAHELLENIC.COM
Or contact our investor relations team
investor.relations@cchellenic.com
+30.210.6183 100
Long-term growth drivers
Most known
brands in the world
Strong focus on
cost leadership and
history of solid cash
generation
Solid track record
of winning in the
marketplace
Diverse geographic
footprint with strong
emerging market
exposure
Low per capita
consumption with great
potential to grow
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