FY2021 Half Year Results Disclaimer
This presentation has been prepared This presentation is not intended to and does not constitute or form part of any offer, or invitation, or solicitation of any offer solely in connection with the financial to issue, underwrite, subscribe for, or otherwise acquire or dispose of any shares or other securities of the Company in any jurisdiction or an inducement to enter into investment activity. No part of this presentation, nor the fact of its distribution, results of C&C Group plc (the should form the basis of, or be relied on in connection with, any contract or commitment or investment decision whatsoever. "Company") for the period ended 31 August 2020 and should be read in The presentation contains forward-looking statements, including statements about the Company's intentions, beliefs and conjunction with the announcement of 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 the financial results of the Company uncertainties, are based on certain assumptions and speak only as of the date they are made. The Company undertakes no for the period ended 31 August 2020, duty to and will not necessarily update any such statements in light of new information or future events, except to the extent released 21 October 2020 (the “H1 21 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 Results Announcement”). For the statements. purposes of this notice, the presentation that follows shall mean Past performance is no guide to future performance and persons needing advice should consult an independent financial and include the slides that follow, the adviser. oral presentation of the slides by the Your attention is drawn to the ‘Principal Risks and Uncertainties’ set out on page 16 of the Company’s” H1 21 Results Company, the question-and-answer Announcement”. The risks described, however, are not exhaustive and there may be other risks which may have an session that follows that oral adverse effect on the business, financial condition, results or future prospects of the Company. presentation, hard and electronic Bulmers Ltd of Clonmel, Ireland, a company within the C&C Group, owns the trade mark BULMERS® in the Republic of copies of this document and any Ireland. Bulmers Ltd is not connected with HP Bulmer Ltd of Hereford, UK. BULMERS ® Original Vintage Cider produced materials distributed at, or in by Bulmers Ltd of Clonmel, Ireland is sold outside the Republic of Ireland under the name MAGNERS® Original Irish Cider. connection with, that presentation. For further information see www.candcgroupplc.com
C&C Group plc 2 Uniquely Strong Business Model
Local and Core Brands Route to Market Strength & Scale
# 1 Brand Positions
# 2 Apple # 1 Largest final mile # 1 Independent Distributor Cider in UK capability in UK & Ireland
National Network
Underpinned by robust liquidity and a strong balance sheet
C&C Group plc 3 FY2021 H1 - Securing the Short Term and Positioning for the Long Term
C&C – occupying a fundamental role in the infrastructure and fabric of UK and Irish drinks market
Key Themes in H1 FY21
Market Share Gains & Navigating COVID-19 On-Trade Progression Customer Service Distribution Network Attracting new partners
C&C Group plc 4 Navigating COVID-19
Management Priorities
Employee Health and Safety Operational Responses Liquidity Actions
• Structurally important to the on-trade in the UK and Ireland • Supporting our on-trade customer base • Continuing focus on an optimised cost base • Flexible and Committed People
C&C is well positioned business beyond the short term challenges of COVID-19
C&C Group plc 5 On-Trade Progression in Core Markets
100% 70
90% 60 80% When allowed - we serve the market 70% 50
60% 40 Quick to react 50%
30 40% Matthew Clark and Bibendum distribution 30% 20 points in August at 76% of FY20 20% 10 10%
0% 0 Increase in Matthew Clark Account wins Mar Apr May Jun Jul Aug year on year: +66% July through €m Distribution Points (% of PY) September
Source revenue: unaudited management accounts C&C Group plc Distribution points core markets: Ireland; GB and Matthew Clark Bibendum 6 Customer Service
C&C Acquisition of Matthew Clark Bibendum Customer Service Index Insights 88.0 86.0 84.0 82.0 Industry leading customer satisfaction 80.0 78.0 76.0 Fulfilling demand as on-trade returns 74.0 72.0
Recognised for excellence by industry
Bibendum CSAT Matthew Clark CSAT
OTIF 99.0% 97.0% 95.0% 93.0% 91.0% Drinks Company of the Year - 89.0% Drinks Business Awards 2020 87.0% 85.0% Sep-19 Oct-19 Nov-19 Dec-19 Jan-20 Feb-20 Mar-20 Apr-20 May-20 Jun-20 Jul-20 Aug-20
Group Average Group Average (Ex MC)
C&C Group plc 7 Market Share Gains & Attracting New Partners
All 3 core local brands have all taken market share in the off-trade in H1
Off-trade Lager: +31.9%
Off-trade Tennent’s: +38.8%a
Market share growth
Off-trade LAD: +46.7%
Off-trade Bulmers: +53.8%b
Market share growth
Off-trade Cider: +25.5%
Off-trade Total Magners: +27.4%c
Market share growth
a. IRI 26 weeks to 09.08.20 C&C Group plc b. Nielsen (Ireland), Off Trade Share, 6 months to August 2020 8 c. IRI 26 weeks to 09.08.20 Review of FY2021 H1
C&C Group plc 9 Summary of FY2021 H1 Results
Including IFRS 16 Excluding IFRS 16 Financial €m (except per share items) H1 FY2021 H1 FY2020 H1 FY2021 H1 FY2020 • Business returned to profit in July and Net Revenue (1) 386.7 866.1 386.7 866.1 August. (1) 4.9 79.9 (6.3) 71.0 Adjusted EBITDA • Average €6m loss per month (net of Operating (loss)/profit (1) (11.7) 64.4 (14.0) 63.3 furlough) while on-trade was in full lockdown (1)
constant currency constant Operating Margin NM 7.4% NM 7.3% Exceptional Items (post tax) (6.8) (2.0) (6.8) (2.0) • Good working capital management
Associate loss/income (1) (3.4) 1.9 (3.4) 1.9 • Liquidity robust and flat in line with levels communicated on 3rd June.
Adjusted diluted EPS (8.2) 16.0 (8.3) 16.3 • Cash/RCF headroom of €415m excluding unutilised Debtor Free cash flow (28.4) 90.9 (38.0) 80.6 Securitisation. Net Debt 371.6 343.6 287.0 255.4 • Eligible for application to CCFF
(1) Pre-exceptionals
C&C Group plc 10 FY2021 H1 Highlights
Operational Strategic
• Continuing focus on an optimised cost base • Appointment of a new CEO and CFO* • Core brands off-trade revenue growth in their core • Board level ESG Committee established markets, +28% in H1 • Commitment to carbon neutral with CO2 capture in • Market share gains Wellpark • Manufacturing sites and depot network remain open • Continued focus and advancement: • Positive service levels • Brand led, final mile distribution model is the platform for the long term • Brand development • Data and Insight • Optimisation of the Scotland and E&W distribution network • Investment in e-commerce across the core markets
*David Forde to join as CEO on 2nd November 2020 C&C Group plc 11 Positioning for the Long Term – E-commerce & Data and Insight
E-commerce
Investment into e-commerce platforms
LIVE
Data and Insight
Start Current Future Group Data and Insight function created Agreement signed with SalesOut in H1 Build strategic data partnerships unifying disparate data sources across Continue developing proprietary data Advanced analytics to drive performance the Group assets and decision-making
C&C Group plc 12 Positioning for the Long Term - Brand Development
Evolving consumer preferences drive continuing investment into our core brands and portfolio
C&C Group plc 13 Financial Performance
C&C Group plc 14 Securing the Short Term
Liquidity Balance Sheet
• H1 liquidity maintained in line with our 3rd June update, with • Working capital management cash on hand/ RCF headroom of €415m excluding our un-utilised Debtor Securitisation Facility and “CCFF” • Offset supplier and customer payment plans • Current liquidity as of 20th October of €387m • Agreed tax payment deferrals with the UK and Irish revenue • Successfully negotiated €60m deferral of term loan repayment beyond 12 months • COVID-19 Provisions • Covenants waiver extended to February 2022 • €47.6m made across the group at YE and they remain intact • Securitisation facility of £200m, outflow in H1 of €36m with reduction in debtor book • Net debt/gearing • Bank of England's Covid Corporate Financing Facility ("CCFF“): • Net debt €44.7m higher than FY2020 - driven by working up to £300m available – now subject to qualifying conditions capital and Admiral Investment
C&C Group plc 15 Net Revenue
€m
C&C Group plc 16 Net Revenue Core Brands in the UK & Ireland
€m
22.6
4.5 17.7 2.9 7.0 3.4
111.7
75.2
H1 FY2020 CC Tennents on Tennents off Bulmers on Bulmers off Magners on Magners off H1 FY2021
C&C Group plc 17 Net Revenue year on year
On Trade Net Revenue in €m 120 August increased to €65m
100 -39% -32% -47% 80
60
-65% -73% 40 -77%
20
0 Mar-20 Apr-20 May-20 Jun-20 Jul-20 Aug-20
Off-trade On-trade
C&C Group plc 18 Operating Profit / (Loss)
€m
C&C Group plc 19 Group Free Cash Flow
4.9
16.6
(25.7)
(11.7)
5.7 (7.6) (0.4) (0.2) (5.5) 0.4 (28.4) (4.0) (32.4)
Op profit pre- Depn/Amortisation Adjusted EBITDA Working capital Trade loans Tax Net finance costs Pension Net capital Other FCF before Exceptional items Free cash flow exceptionals contributions expenditure exceptionals
C&C Group plc 20 Group Net Debt
C&C Group plc 21 Current Trading and Outlook
C&C Group plc 22 Current Trading and Outlook for H2 & FY2021
• Liquidity position remains robust and we have begun to take permanent action to right-size our fixed cost base
• Alongside the re-opening of the On-Trade the Company returned to profitability in July, August and September. The pace of recovery is varying; new restrictions in late September and October have impacted On-Trade volumes and distribution points
• Level of profitability will track the size of the available On-Trade market – financial flexibility in place to support the business through further lockdown measures
• Business prepared for increased off-trade supply to meet demand through the Christmas trading period. Core brands well positioned to continue to gain share in the Off-Trade channel
• Brexit planning measures in place should no trade deal be agreed before 31 December
• Disposal of non-core Tipperary Water Cooler Non-Alcoholic Drinks business in Ireland
• Our unrivalled brand-led, final mile distribution platform is integral to the recovering On-Trade and wider drinks market; Key to our positioning for the future
C&C Group plc 23 Q&A
C&C Group plc 24 APPENDIX
C&C Group plc 25 Core Brands Performance in UK and Ireland
€m
-36% -45% -13%
C&C Group plc 26 Group Net Debt – Excluding IFRS 16 Leases
€'m
(233.6) (42.0) (6.8) (0.6) (4.0) (287.0)
Feb-20 Free cash flow Purchase of equity Non-cash issue costs Translation Aug-20 accounted investments
C&C Group plc 27 C&C Group plc 28