Britvic : Final Result

Britvic plc Preliminary Results - 24 November 2021

"Emerging stronger, confident in future growth prospects"

For the year ended 30 September 2021

Group Financial Headlines:

• Revenue increased 6.6%* to £1,405.1m (reported -0.5%)
• Adjusted EBIT increased 10.0%* to £176.5m (reported +6.5%), statutory EBIT increased 23.3%
• Adjusted EBIT margin increased 40bps* to 12.6% (reported +90bps)
• Profit after tax increased 9.1% to £103.2m
• Adjusted earnings per share of 44.3p, up 2.5%, impacted by a one-off deferred tax charge of £11.2m
• Record free cash flow generation of £132.7m enabling a £31.9m reduction in adjusted net debt
• Full year dividend +12.0%, reflecting the board's confidence in our prospects and strong balance sheet

Highlights:

• Revenue growth in GB and Brazil, led by our portfolio of family favourite brands
• Continued growth in At-Home channels with Out-of-Home rebounding in the second half
• Margin rate progression while rebuilding investment in our people, brands, and infrastructure
• Continued progress against our strategic objectives including:

• 1. Accessing new growth spaces - Plenish, Aqua Libra Co and Rockstar o Simplifying our Irish business with the closure of Counterpoint
     o Converting all GB immediate consumption packs to 100% rPET
• Strong cash generation with adjusted net debt/EBITDA leverage ratio back to 2019 level

Current Trading & FY22 Outlook:

• Encouraging trading with volumes in first six weeks of the year ahead of FY21 and FY20
• Investing behind growth drivers to accelerate long-term revenue and profit trajectory
• Confident in making further progress with revenue, profit and margin growth in 2022 despite inflationary cost pressures

	Year ended	Year ended	% change	Underlying
	30 September	30 September	actual exchange	% change
	2021	2020	rate (AER)	constant
	£m	£m		exchange rate*
Revenue	1,405.1	1,412.4	(0.5)%	6.6%
Adjusted EBIT	176.5	165.8	6.5%	10.0%
Adjusted EBIT margin	12.6%	11.7%	90bps	40bps
Adjusting EBIT items**	(15.8)	(35.5)	55.5%
Statutory EBIT	160.7	130.3	23.3%
Statutory EBIT margin	11.4%	9.2%	220bps
Profit after tax	103.2	94.6	9.1%
Basic EPS	38.7p	35.6p	8.7%
Adjusted EPS	44.3p	43.2p	2.5%
Full year dividend per share	24.2p	21.6p	12.0%
Adjusted net debt/EBITDA	2.1x	2.4x	(0.3)x

• Adjusted for constant currency, the French private label juice business that was disposed of in 2020 and the Ireland agency brands which ceased trading in March 2021.
• Adjusting EBIT items of £15.8m and £0.1m included in net finance costs are detailed on page 11.

1

Simon Litherland, Chief Executive Officer commented:

"This year we have recovered strongly from the effects of the pandemic, with underlying revenue, margin, and profit all in growth. Our disciplined cash management enabled us to pay down debt and to increase our dividend by 12.0%, reflecting our confidence in the business.

We continue to invest in our brands, people, and infrastructure. Our portfolio of trusted family favourite brands has led the growth across our business units, and we continue to access new growth spaces through innovation, the acquisition of Plenish and the relaunch of Rockstar. We have simplified the business in Ireland with the closure of Counterpoint. Our Healthier People, Healthier Planet sustainability programme has also progressed well, with the rollout of recycled PET in GB, and carbon reduction initiatives across the business.

Looking ahead, as we execute our growth strategy, I am confident that we will continue to deliver consistent returns to shareholders. While there are multiple operational headwinds leading to increased inflation, we are confident we will mitigate them through a combination of our agile and resilient supply chain, revenue management and cost saving actions. In 2022 we anticipate making further progress with revenue, profit and margin ahead of 2021."

For further information please contact:
Investors:
Joanne Wilson (Chief Financial Officer)	+44	(0)	121 711 1102
Steve Nightingale (Director of Investor Relations)	+44	(0)	7808 097784
Media:
Kathryn Partridge (Director of Corporate Affairs)	+44	(0)	7803 854229
Stephen Malthouse (Headland)	+44	(0)	7734 956201

There will be a webcast of the presentation given today at 09:00am by Simon Litherland (Chief Executive Officer) and Joanne Wilson (Chief Financial Officer). The webcast will be available at www.britvic.com/investors with a transcript available in due course. To ask a question on the webcast, please dial [phone] and enter the confirmation code 6714568.

Notes to editors

About Britvic

Britvic is one of the leading branded soft drinks businesses in Europe. The company combines its own leading brand portfolio including Robinsons, Tango, J2O, London Essence, Plenish, Teisseire and MiWadi with PepsiCo brands such as Pepsi, 7UP, Rockstar and Lipton Ice Tea, which Britvic produces and sells in GB and Ireland under exclusive PepsiCo agreements.

Britvic is the largest supplier of branded still soft drinks in Great Britain (GB) and the number two supplier of branded carbonated soft drinks in GB. Britvic is an industry leader in the island of Ireland with brands such as MiWadi and Ballygowan, in France with brands such as Teisseire, Pressade and Moulin de Valdonne and

2

in Brazil with Maguary, Bela Ischia and Dafruta. Britvic is growing its reach into other territories through franchising, export, and licensing. Britvic's management team has successfully developed the business through a clear strategy of organic growth and international expansion based on creating and building scale brands. Britvic is listed on the London Stock Exchange under the code BVIC and is a constituent of the FTSE250 index.

Cautionary note regarding forward-looking statements

This announcement includes statements that are forward-looking in nature. Forward-looking statements involve known and unknown risks, uncertainties and other factors including because of the COVID-19 pandemic, which may cause the actual results, performance, or achievements of the Group to be materially different from any future results, performance or achievements expressed or implied by such forward- looking statements. Except as required by the Listing Rules and applicable law, Britvic undertakes no obligation to update or change any forward-looking statements to reflect events occurring after the date such statements are published.

Market data

GB take-home market data referred to in this announcement is supplied by Nielsen and runs to 25 September 2021. ROI take-home market data referred to is supplied by Nielsen and runs to 12 September 2021. French market data is supplied by Nielsen and runs to 12 September 2021. Brazil is supplied by Nielsen and runs to 30 September 2021.

Next scheduled announcement

Britvic will publish its quarter one trading statement on 27 January 2022.

3

Chief Executive Officer's Review

Today we report our results for the year ended 30 September 2021, during which time our business continued to successfully navigate impacts from the COVID-19 pandemic. Once again, I am incredibly proud of the entire Britvic team, who have shown agility and resilience to deliver a strong performance, progress our strategic priorities and support each other and our communities. On behalf of the Board and the Executive, I would like to extend my thanks to each of them and their families for their continued commitment.

Our financial performance in the first half was impacted by lockdowns and social distancing measures across our markets. This impacted our channel mix, with the At-Home channel growing strongly, while Out-of- Home trading was significantly impacted by On-Trade closures and capacity limitations. As COVID-19 restrictions eased in the second half, Out-of-Home volumes rebounded strongly, while the At-Home channel remained robust. Immediate Consumption volumes benefited from increased mobility levels and people holidaying domestically, recovering back to 2019 levels in quarter four.

Across our markets we activated a range of exciting marketing campaigns, such as the Pepsi MAX sponsorship of the Champions League, launched new flavours to broaden appeal, such as Tango Dark Berry, and executed in-store and online activity to ensure our brands are visible to consumers. Throughout the pandemic we have strengthened our relationships with customers and suppliers, ensuring that together we could respond with agility to the changing market circumstances. These relationships and our well-invested GB supply chain enabled us to successfully navigate the market-wide supply chain disruptions during the summer and protect our on-shelf availability.

Our performance, and the financial strength of our business, gave us the confidence to increase investment in the second half behind our brands, infrastructure, people, and planet initiatives, and we are emerging from the pandemic as a stronger, faster growing, more resilient business.

I am delighted with the progress we have made across both key financial and non-financial performance indicators. Underlying revenue grew 6.6%, adjusted EBIT 10.0% and margin increased 40bps in the year. Our focus and discipline on cash enabled us to generate record free cash flow of £132.7m, reducing our leverage ratio back to the 2019 level of 2.1x. A priority has also been further progress on our Healthier People, Healthier Planet programme and in the year our employee engagement score of 80 has been top quartile, our calories per serve well below our 30 calories target and we have moved all our Immediate Consumption packs into 100% rPET.

Progress towards our strategic priorities

We refreshed our strategy in 2019 to ensure the business was well-placed to access growth opportunities in the changing consumer and retail landscape across our markets. We have stress tested the strategy for the post-COVID-19 world and remain confident that it will enable us to leverage Britvic strengths and respond to the changing consumer and market trends to drive strong top-line growth. With a portfolio of market-leading brands, a strong multi-channel route to market and collaborative customer relationships in all our geographies, we believe we are well-placed to continue to deliver excellent returns to shareholders and our other stakeholders.

4

Our future focus remains on four key strategic priorities:

• Build local favourites and global premium brands
• Flavour billions of water occasions
• Healthier People, Healthier Planet
• Access new growth spaces

Each of our markets has a defined role to play delivering the strategy:

• GB - to lead market growth
• Brazil - to accelerate growth and expand our presence
• Other International - to globalise premium brands and improve profitability in Western Europe

Underpinning this strategy are three critical enablers:

• Generate fuel for growth through efficiency
• Transform organisational capability and culture
• Selective M&A to accelerate growth

Build local favourites and global premium brands

Consumers have increasingly turned to brands they trust, that taste fantastic and are better for them. So our focus on developing and growing healthier soft drinks has been pivotal to our success and our portfolio of low and no calorie family favourite brands and better for you innovation have continued to resonate strongly.

In GB, we have delivered growth across the portfolio. Pepsi MAX, 7UP free and Tango, our mainstream carbonated brands, had an excellent year, growing revenue and retail sales value. Pepsi's retail value, as measured by Nielsen, crossed the £700m threshold, with no sugar MAX the driver of growth. Market share was stable after the large gains in 2020, while both 7UP and Tango gained market share in the year. With the lifting of restrictions, our socialising brands, such as J20 and Fruit Shoot, have returned to growth as the On-Trade and schools reopened, and mobility normalised. With increased people movement, immediate consumption has rebounded in the latter part of the year. This has benefited both small pack formats across the portfolio and brands such as Lipton, Purdey's and Aqua Libra, which are sold mostly in immediate consumption pack formats. As an example, Lipton revenue increased 47% in the second half of the year.

In Brazil, we have continued to build scale through our core and innovation brands, delivering another year of double-digit revenue growth. Ready-to-drink formats revenue grew 32.5%, with our core brands Maguary, Dafruta and Bela Ischia performing strongly, as well as newer brands Puro Coco, Seleção grape juice, Fruit Shoot and Natural Tea making a meaningful contribution as they build scale.

Last year in France we completed the sale of the low-margin private label juice business, to enable us to focus on our portfolio of brands. Fruit Shoot grew revenue 19.5% and market share 20bps, while Pressade held onto market share but saw a decline in revenue of 5.5%. In the Netherlands, Teisseire retail sales value increased by nearly 26% in the year. In Ireland, we exited the wholesaling of third-party brands, which were

5