DAVIDE CAMPARI-MILANO N.V. Table of contents
Results Summary
Sales Results ‒ By region ‒ By brand
Operating Results by Region Consolidated P&L
Cash Flow & Net Financial Debt Corporate Initiatives Sustainability Roadmap Conclusion & Outlook Annex
Continued execution of our long-term growth strategy in a challenging 2020
Managing the short-term emergency while continuing to nurture the long-term growth
Continuing strong focus on brand building
> Increased focus on digital marketing and off-premise brand building to drive home consumption occasions fuelling double-digit off-premise sell-out growth indicators across key brand-market combinations
>
Selected innovation roll-outs: elevated Appleton Estate image via super premium packaging, new releases of Wild Turkey premium series and roll-out of Crodino for the international markets
> Further developing the digital capabilities across the organization via accelerating programs in digital transformation & e-commerce
Strengthening business infrastructure & commercial capabilities
> Established direct commercial presence in strategic French market
> Enhanced focus on Asia: re-location of the Asia Pacific regional headquarters from Sydney to Singapore, set up of a joint venture in Japan and other new route-to-market initiatives to kick in at beginning of 2021
> Restructuring of the sugar business in Jamaica
> Acquisitions of French distributor RFD and Champagne Lallier as well as a minority stake in Tannico (leading e-commerce platform for premium wines and spirits in Italy)
>
Completion of the company's re-domiciliation to the Netherlands enabling a capital structure more supportive of the Group's external growth strategy in the long run and capable of rewarding a long-term oriented shareholder base
> Successful issue of a 7-year Eurobond of €550 million at attractive coupon rate in September 2020, further extending the Group's overall debt maturity profile and improving its average nominal coupon
Continued focus on people and community
>
The safety and well-being of Camparistas worldwide as a top priority of the Group
> Continued support to the local communities and business partners during Covid-19 emergency, consistently with our Sustainability agenda
Resilient financial performance in FY 2020 given the very challenging context of Covid-19
FY 2020
Change vs. FY 2019
Q4 2020
€ million
Reported
Organic
FX
Perimeter (1)
Organic changeNet sales
1,772.0
Gross profit % on sales/ margin accretion (bps) (2)
1,025.9 57.9%
-3.8% -8.5% -300bps
-4.1% -8.5% -280bps
-2.7% -1.3% +80bps
+3.0% -7.0%
+1.3% -12.1%
-100bps
-320bps
EBIT adjusted (3)
% on sales/ margin accretion (bps) (2)
321.9 18.2%
-21.1% -400bps
-20.4% -380bps
+1.4% +80bps
-2.1% -100bps
-33.0% -620bps
EBITDA adjusted (3)
399.9
-16.7%
% on sales/ margin accretion (bps) (2)
22.6% -350bps
-16.3% -330bps
+0.6% +80bps
-0.9% -100bps
-27.5% -570bps
Group pre-tax profit adjusted (4)
278.9 -24.7%
Group net profit adjusted (4)
Recurring free cash flow
202.1 -24.4% 261.7
Net Debt at period end
1,103.8
Adjusted basic EPS (€)
Proposed dividend per share (€)
0.18 0.055
(1) Mainly including the effect from the acquisitions of Rhumantilles, Ancho Reyes and Montelobos (completed in Q4 2019) and the French distributor Baron Philippe de Rothschild France Distribution S.A.S., now named Campari France Distribution S.A.S. ('RFD') (completed at the end of February 2020). For the latter, only the third party brands managed by RFD were included in the perimeter effect
(2) Basis points rounded to the nearest ten
(3) Before operating adjustments of €(90.1) million in FY 2020 and €(21.7) million in FY 2019
(4) Before operating, financial, non-recurring earn-out liabilities revisions and tax adjustments, for an overall amount of €(14.2) million in FY 2020 (vs. €41.0 million net positive adjustments in FY 2019)
Core brands' health remains strong, confirmed by resilient home-consumption trends
> Net Sales | • | |
• | Reported change of -3.8%, reflecting positive perimeter effect of +3.0% or €54.6 million, and a negative FX effect of -2.7% or €(50.3) million, driven by the devaluation of almost all Group | |
currencies against the Euro | ||
> EBIT | • | EBIT adjusted organic decline of -20.4% and -380 bps margin dilution (or -15.7%, -300 bps margin dilution excluding the US destocking effect), due to negative sales mix by brand and |
market, US destocking, sustained A&P investments, and lower absorption of fixed costs given topline decline (total change -21.1%) | ||
• | EBIT reported declined by -40.0%, reflecting negative operating adjustments of €(90.1) million, mainly including brand impairment losses, restructuring costs and transaction fees | |
> Net profit | • | Group net profit adjusted to €202.1 million, down -24.4% |
• | Group net profit reported to €187.9 million, down -39.1%, after total adjustments of €(14.2) million (1), of which €(90.1) million negative operating adjustments, €1.4 million positive financial | |
adjustments, €19.4 million positive adjustments related to the remeasurement of put option and earn-out liabilities, and €55.1 million positive tax adjustments | ||
> Free cash flow | • | Free cash flow at €168.6 million. Recurring free cash flow of €261.7 million, or 65.4% of EBITDA adjusted, up from 55.7% in 2019, driven by a temporary working capital reduction at year-end, |
due to phasing effects generated by the renewed restrictions impacting business performance | ||
> Net debt | • | Net financial debt at €1,103.8 million as of 31 December 2020 vs. €777.4 million as of 31 December 2019, up €326.4 million, as the good cash flow generation was absorbed by the M&A activities |
and financial commitments (the share buyback and the dividend payment), for an overall amount of €519.2 million(2) | ||
• | Net debt to EBITDA adjusted ratio(3) at 2.8 times as of 31 December 2020, up from 1.6x as of 31 December 2019, as a result of a temporary reduction of EBITDA due to Covid-19 | |
> Dividend | • | Proposed full year dividend at €0.055 per share (4), in line with last year |
By brand: Global Priorities declined by -3.8%, despite positive performance from Wild Turkey and Jamaican rum portfolio, due to on-premise skewed brands (mainly aperitifs), impacted by restrictions throughout the year across markets, amplified by renewed lockdowns at year end, and US destocking (mainly SKYY and European imports). Aperol (-0.1%) has grown +11.0% excluding Italy and GTR in FY 2020. Regional priorities were up +0.4% overall, driven by strong growth from Espolòn (+29.9%) while Local Priorities were down -4.4%, largely due to the on-premise skewed single-serve aperitif in Italy. Meanwhile, sell-out trends in the off-premise continue to outperform shipments across the key brand-market combinations
Overall organic decline of -4.1% with Q4 down -7.0%, largely due to the impact of renewed lockdowns and severe restrictive measures affecting key on-premise markets. On a full year basis, continued sustained growth in the off-premise skewed markets such as the US, Canada, Australia and Northern Europe helped mitigate weakness in on-premise led markets, mainly Italy, as well as GTR
- By geography: resilient growth in core off-premise markets in 2020. US +3.4% despite destocking effect (US market +9.1% and overall Group -2.5% excluding the destocking effect),
Germany +8.6%, Canada +12.5%, Australia +20.2%, more than offset by the weakness in the on-premise markets like Italy (-17.4%), South America as well as GTR. Q4 was weak mainly driven by SEMEA and NCEE due to the restrictions re-introduced in the on-premise as well as less pronounced staycation effect comparing to the summer given the lower seasonality for aperitifs and lack of winter sports tourism
-
(1) Refer to slides 39 'Operating adjustments' and slide 41 'Group net profit adjusted' for further details
(2) Of which M&A transactions of €125.0 million (French distributor, Lallier Champagne and Tannico investment), tax payment on previous non-core real estate disposal (Villa Les Cèdres) of €60.1 million, share buyback of €271.2 million and dividend payment of €62.9 million
(3) Calculated as net debt at period end divided by EBITDA adjusted for the last twelve months
(4) Subject to the approval of the Shareholders' Meeting on 8 April 2021
Table of contents
Results Summary
Sales Results ‒ By region ‒ By brand
Operating Results by Region Consolidated P&L
Cash Flow & Net Financial Debt Corporate Initiatives Sustainability Roadmap Conclusion & Outlook Annex
Shipment resilience across key off-premise brand-market combinations
FY 2020 Net sales organic performance by Region
> Americas: the US grew +3.4% after a positive performance in Q4 (+13.0%) driven by gradual shipment catch-up in core Wild Turkey, aperitifs and Espolòn, notwithstanding destocking in selected brands. Continued resilience in off-premise skewed Canada (+12.5%) was unable to offset persistent weakness in Jamaica and South America
> SEMEA: core Italy down -17.4% after a weak Q4 (-32.6%). GTR, Spain and South Africa also declined. France grew overall with positive transition to the new wholly owned distribution structure
> NCEE: resilient performance across the region overall, despite weakness in Q4 (-3.0%) due to renewed restrictions and less pronounced staycation effect given the lower seasonality for aperitifs in winter comparing to the summer and lack of winter sports tourism
> Asia Pacific: continued solid growth in off-premise skewed Australia (Q4 +18.7%) helped offset the declines in Japan and China ahead of route-to-market changes
FY 2020 Net sales organic performance by Priority
(1) Including Rest of Portfolio, down -10.0% in FY 2020
> Global Priorities: overall performance of on-premise skewed brands (Aperol, Campari, Grand Marnier) affected by restrictions, also exacerbated by the US destocking, which more than offset the very positive momentum in the off-premise. Jamaican rums and Wild Turkey grew, whilst SKYY declined largely due to destocking in the core US ahead of a complete brand relaunch
> Regional Priorities: overall flattish with strong growth of Espolòn and Forty creek offsetting the weakness of other brands
> Local Priorities: growth of Wild Turkey RTD, Ouzo12 and Cabo Wabo was more than offset by declines in the on-premise skewed single-serve aperitifs (Campari Soda and Crodino)
Strong brand momentum in off-premise across key brand-market combinations in 2020
Strong off-premise sell-out trends in key brand-market combinations (1)
Total Campari US | |
Total Campari Germany | |
Total Spirits Market | |
Aperol | Total Spirits Market |
Espolòn | Aperol |
Wild Turkey | |
Campari | |
SKYY Vodka | |
Ouzo12 | |
Grand Marnier | |
Campari |
-15% 5%Off-premise sell-out value growth in FY 2020
25% 45% 65%Overall shipment value organic growth in FY 2020
0%
10%
20%
30%
Off-premise sell-out value growth in FY 2020
Overall shipment value organic growth in FY 2020
Total Campari Italy Total Spirits Market
Campari Aperol Crodino Campari Soda
Campari
-25% -15%Off-premise sell-out value growth in FY 2020
-5%
5% 15% 25%Overall shipment value organic growth in FY 2020
Total Campari UK Total Spirits Market
Aperol Wray&Nephew
Off-premise sell-out value growth in FY 2020
0% 10% 20%
30% 40% 50% 60% 70%Overall shipment value organic growth in FY 2020
80%
(1) US: Nielsen data XAOC+Total Liquor, representing c. 34% of total US off-trade value, YTD W/E 26/12/2020; Germany: Nielsen LEH+DM = Off-Trade (no C&C), W2-W53 2020; Italy: IRI Iper+super+LSP, YTD WE 27/12/2020; UK: Nielsen, YTD W/E 26/12/2020 8
E-commerce: rapid acceleration, high recruitment & poised for future growth
Solid development in key E-commerce markets such as the US & UK, with others (Australia, Germany, France, Italy) registering strong double-digit growth from a low base
> E-commerce accounts for approx. 2% of Group's net sales in FY 2020 > Over indexing in the US and UK, accounting for approx. 3% and 10% of each market's net sales respectively in FY 2020
> Campari US grew E-commerce value by ca.+500% vs. 2019 (1)
> Now the 5th biggest supplier by volume, 6th biggest by value (2)
> 12 partners activated, +300 pieces of content deployed with high recruitment levels
> Campari UK E-commerce value grew c.+90% vs 2019 (1)
> Amazon UK value grew +198% and Ocado value grew +70% vs 2019 (3)
(4)
+127%
Campari vol growth vs PY
(+127 bps share)
+344%+759% +409%
Campari vol growth vs PY (+87 bps liquor share)
+377%+1997%
(1) Internal data and estimates
(2) Nielsen Rakuten P12M, Dec 2020
(3) Internal data, Amazon Vendor Central and Ocado Tableau data from 01.01.2020 to 31.12.2020
(4) Internal data collected from Amazon Vendor Central. Value vs 2019. Data from 01.01.2020 to 31.12.2020
US remains the largest market with 28.6% of Group net sales in FY 2020
Others 1.5%
Australia 5.8%
Asia Pac: 7.4% of total
Organic growth: +4.6%
UK 2.8%
Russia 2.9%
NCEE:
22.8% of total
Organic growth: +6.8%SEMEA:
26.2% of total
Organic growth: -18.6%
Others 6.8%Germany 10.3%
Others 2.7%
GTR 0.5%
France 5.8%
USA 28.6%Jamaica 5.1%Canada 3.6%
Brazil 1.9%
Mexico 1.5%
Americas: 43.7% of total
Organic growth: -1.8%
Net sales organic growth by quarter
Italy 17.1%
Others 3.0%
>
Developed vs. emerging markets in FY 2020 (1) : 83% vs. 17%
Q1 | Q2 | Q3 | Q4 |
2020 | |||
-5.3% | -15.9% | 12.9% | -7.0% |
2019 | |||
9.6% | 6.9% | 4.9% | 3.6% |
(1)Key emerging markets include Jamaica, Russia, Brazil, Argentina, Mexico, South Africa, Nigeria, Peru and China
Off-premise gaining momentum
>
Strong sell-out trends registered across the off-premise channel in key markets during 2020
Weight of off-premise by net sales (%) pre-Covid 19 (1)
Group and regions
100% 50%
Ca. 70%
Group
AmericasSEMEA
(1) Source: Internal data
Off-premise weight (pre-Covid 19) and sell-out value growth in 2020 (2)
Key markets
Ca. 70%
NCEE
Asia Pac
US
Canada
Italy
Germany
UK
Australia
(2) US: Nielsen data XAOC+Total Liquor, representing c. 34% of total US off-trade value, YTD W/E 26/12/2020; Germany: Nielsen LEH+DM = Off-Trade (no C&C), W2-W53 2020; Italy: IRI Iper+super+LSP, YTD WE 27/12/2020; UK: Nielsen, YTD W/E 26/12/2020 ; Canada: National EZFocus Dataset, Jan - Dec P10 (W/E 1/3/2021); Australia: IRI Scan Data, YTD WE 27/12/2020
Americas (-1.8% organic): focus on the US market
Shipments impacted by lockdowns and destocking, whilst strong brand momentum continues
US:
> Overall positive shipments performance (+3.4%) despite the on-premise (accounting for ca. 30% of the market's net sales pre-Covid 19) restrictions impacting in particular the European imports (Grand Marnier, Campari, Aperol and Italian bitters), and the destocking across the whole portfolio, now fully completed. Moreover, the Italian portfolio (aperitifs and bitters) were also penalized by the import tariffs introduced. Excluding the destocking effect, the US market's organic growth would have been +9.1% in FY 2020
> Recovery in Q4 (+13.0%), largely driven by the gradual shipment re-alignment to very positive off-premise consumption patterns. The aperitifs also grew in Q4 thanks to gradual shipment catch-up. Continued strong performance of Espolòn, the Jamaican rums and the Wild Turkey franchise, particularly the higher-margin Longbranch and Russell's Reserve, thanks to strong category momentum. SKYY continued to be affected by destocking at wholesaler level, in particular the flavour category, ahead of a complete brand relaunch, as well as Grand Marnier
> Brand momentum in the off-premise continues to be strong across the whole portfolio with sell-out growing in value at +32.3% overall in full year 2020, growing approximately 1.5 times faster than the overall market (1). Sell-out in the off-premise showed strong double-digit growth for core brands as well as the newly acquired Mexican brands Ancho Reyes and Montelobos
> Solid development in the e-commerce channel, now accounting for ca. 3% of the US net sales, growing by ca. +500% vs. 2019 (3)
Focus on the Group's off-premise sell-out performance in the US since the beginning of the pandemic (2)
Mar
AprMayJunJulAugSepOctNovDecSpirits marketCampari Group
(1) US Nielsen data Xaoc+Total Liquor, representing c. 34% of total US off-premise value YTD W/E 26/12/2020
(2) US Nielsen data Xaoc+Total Liquor, representing c. 34% of total US off-premise value W/E 14/03/2020 -W/E 26/12/2020
(3) Internal data and estimates
Americas (1): -1.8% organic (cont)
Other markets
% change
€million
Organic growth by key market in FY 2020
> Canada
> Jamaica
Regional net sales quarterly growth
Q1 Q2 Q3 Q4 | |
2020 | -0.9% -13.5% 4.3% 2.5% |
2019 | 13.1% 7.3% 0.5% 4.3% |
+12.5% • Resilient growth continued in the largely off-premise market driven by core Forty Creek and the Jamaican rums as well as Grand Marnier, Aperol, Campari and Espolòn
-8.2% •
Overall decline notwithstanding continued positive momentum of Wray&Nephew, due to on-premise restrictions and sharp reduction in touristic flows, further amplified by a tough comparison base (+17.6% in FY 2019)
> Others
-18.7% •
On-premise skewed Brazilian market remains challenged with a negative performance across the portfolio. Mexico down by -31.2% with declines across the entire portfolio while Argentina grew by +4.0% driven by shipments recovery in the context of an unstable economy
(1)Estimated net sales split of on/off premise pre-Covid 19: c. 35%/65%
NCEE (1): +6.8% organic
% change
€million
Regional net sales quarterly growth
Q1 Q2 Q3 Q4 | |
2020 | 6.6% 5.4% 23.8% -3.0% |
2019 | 11.6% 4.2% 10.4% 9.9% |
Organic growth by key market in FY 2020
> Germany
+8.6% •
Solid growth in a resilient off-premise market (estimated channel split on/off-premise pre-Covid 19 was 30% / 70%) despite a slower growth pattern in Q4 (+1.1%), due to renewed restrictions and a less pronounced staycation effect given the lower seasonality for aperitifs in winter comparing to the summer. Overall, growth in Aperol, Ouzo12, Campari, Cinzano Vermouth and Bulldog was able to fully offset declines in specialty bitters and agency brands. The sell-out trends in the off-premise for Germany remained strong in 2020, with the business growing twice as fast as the market, driven by key brands such as Aperol and Campari(2)
> UK
+7.4% •
Resilient growth overall despite a weak Q4 (-20.4%), largely due to the tough comparison base (Q4 2019 +67.8%) and on-premise restrictions. Key brands such as Aperol, Campari, Wray&Nephew Overproof and Magnum Tonic grew by strong double-digit
• Strong sell-out trends in the off-premise in 2020 growing at +38.4%, twice as fast as the local market. This outperformance was mainly driven by Aperol, Campari and Wray&Nephew Overproof growing above +50.0%(3)
• Very positive development in the e-commerce channel, now accounting for ca.10% (4) of the Group's net sales in the UK market, growing by ca. +90% vs. 2019
> Russia
+10.7% •
Overall positive performance driven by growth in Aperol, Mondoro, Cinzano vermouth, Espolòn and Campari
> Others
+2.1% • Positive growth in Switzerland and Belgium as well as Eastern European markets, mainly driven by Campari and Aperol, was partially offset by a decline in Austria mainly due to the lack of tourism
(1) Estimated net sales split of on/off premise pre-Covid 19: c. 30%/70%
(2) Germany: Nielsen LEH+DM = Off-Trade (no C&C), W2-W53 2020
(3) UK: Nielsen, YTD W/E 26/12/2020
(4) Internal data and estimates
SEMEA (1): -18.6% organic
Regional net sales quarterly growth
Q1 Q2 Q3 Q4 | |
2020 | -23.0% -39.8% 23.8% -30.2% |
2019 | 6.4% 8.6% 8.9% -1.8% |
Organic growth by key market in FY 2020
> Italy
-17.4% •
Highly volatile year given its strong on-premise skew (estimated to be c. 70% of the market's pre-Covid net sales), with the quarterly performance reflecting the intensity of the restrictions linked to Covid-19: Q1 -24.4%, Q2 -39.3% reaching the negative peek, Q3 +35.4% benefiting from the temporary on-premise re-opening and staycation and Q4 -32.6% due to renewed restrictions
• The entire portfolio declined over the year, in particular Aperol, Campari and single-serve aperitifs (Campari Soda and Crodino), with the exception of Aperol Spritz ready-to-drink (3) which registered a double-digit growth thanks to home consumption
• Sell-out in the off-premise remains strong (4), with both Aperol and Campari tracking above +25% in 2020, while Campari Soda and Aperol Spritz RTD also grew double-digits
> Others -22.0% •
France grew double-digit overall with Q4 up +9.6%, thanks to the positive transition to the new wholly owned distribution structure. The performance was driven by Aperol, Riccadonna, Campari and The GlenGrant
• Global Travel Retail (-68.9%) remains highly challenged as the travel industry continues to be severely impacted across all channels
• Spain declined -47.7% due to both its on-premise exposure as well as lack of international tourism
• Within Africa, both Nigeria and South Africa declined
(1) Incl. Global Travel Retail. Estimated net sales split of on/off premise pre-Covid 19: c. 65%/35%
(2) Perimeter effect largely driven by first-time consolidation of Rhumantilles from Q4 2019 and RFD third-party distribution business from February 2020
(3) A stand-alone brand not included in the Aperol brand performance
(4) Italy: IRI Iper+super+LSP, YTD WE 27/12/2020
Asia Pacific (1): +4.6% organic
% change
€million
Organic growth by key market in FY 2020
Regional net sales quarterly growth
Q1 Q2 Q3 Q4 | |
2020 | 3.5% 10.1% 2.9% 2.8% |
2019 | -3.1% 4.9% 0.7% 0.6% |
> Australia
+20.2% •
Continued very positive performance in off-premise skewed Australia (estimated to be c. 85% of the market's pre-Covid net sales and broadly unchanged in 2020), with ongoing positive trends in peak Q4 (+18.7%). The positive performance was driven by Wild Turkey ready-to-drink, Wild Turkey bourbon, American Honey as well as good growth from Aperol, Campari, Cinzano Vermouth, Frangelico, The GlenGrant and also Espolòn off a small base
• Sell-out trends in the off-premise remained very strong, growing at +22.6% for 2020, driven by Wild Turkey RTD, Wild Turkey bourbon and also Espolòn and Campari(2)
> Others
-29.7% •
The other markets largely suffered due to restrictions related to the pandemic: China declined by -14.4% overall after a weak Q4 driven by destocking ahead of route-to-market change, amplified by a tough comparison base (Q4 2019 +120.2%), while New Zealand (-9.3%) and Japan (-57.7%) also declined, both impacted by new route-to-market transitions
(1) Estimated net sales split of on/off premise pre-Covid 19: c. 30%/70%
(2) Australia: IRI Scan Data, YTD WE 27/12/2020
Net sales by brand
Agency brands & Co-packing 8%
Global Priorities, 56%
Organic change -3.8%
Aperol (19% of Group net sales): -0.1% (1)
> Organic performance of the brand was highly impacted by the weak results in core on-premise skewed markets due to lockdown measures, such as the core Italian market (accounting for 31% of total Aperol sales in FY 2020) and Spain, tourism-skewed market like Austria, as well as GTR, offsetting the positive performance in Germany, France, the US, the UK and Russia
> Italy
> Excluding Italy and GTR, Aperol has grown +11.0% in FY 2020
> Germany
> On the contrary, the brand registered sustained off-premise sell-out growth across the brand's core markets in 2020, in particular Germany (+31.0%), the US (+66.5%), Russia, Switzerland, the UK (2)
> US
> France
> Russia
Strong off-premise sell-out of Aperol across key markets (2)
Aperol: Perfect serve & Food Pairing
Italy
Germany
USA
Russia
Switzerland
UK
Austria
-15%
-5%
This winter, Aperol launched global campaigns to support the perfect serve and in-home consumption by encouraging the ideal food pairings & home cooking across all social media channels (Twitter, youtube, Instagram).
Italy - Together we can cook with renowned chefs
UK- pairing with online delivery services (Deliveroo/UberEats) to drive Aperol at home and win spritz kits
The US - #AperollovesPizza campaign with full influencer support to extend the Aperol season
Germany - Indulgence@Home campaign to pair Aperol with Italian food
5%
15%
25%
35%
45%
55%
65%
75%Off-premise sell-out value growth in FY 2020 vs. LYShipment value organic growth in FY 2020 vs. LY
Argentina - #brunchAspritz campaign to encourage Aperol as the perfect serve for a brunch occasion
(1) Sales at constant FX. Q4 2020 sales organic growth: -10.3%
(2) US: Nielsen data XAOC+Total Liquor, representing c. 34% of total US off-trade value, YTD W/E 26/12/2020; Germany: Nielsen LEH+DM = Off-Trade (no C&C), W2-W53 2020; Italy: IRI Iper+super+LSP, YTD WE 27/12/2020; UK: Nielsen, YTD W/E 26/12/2020; Russia: Nielsen Scantrack, YTD WE 03/01/2021; Austria: Nielsen YTD W52 2020; Switzerland: Nielsen, YTD W/E 26/12/2020
Unparalleled affection from consumers worldwide
#AperolSpritz: 1st most mentioned cocktail online worldwide in 2020 (1)
The Aperol Spritz is the original Spritz
Implemented in 20+ markets
(1)
ECOMMERCE TOOLKIT
NEW ASSETS RELEASE
DIGITAL & SOCIAL ACCELERATION
Source: Spinklr AI software - combining monitoring and research across all social outlets and platforms. Data retrieved from 1 January 2020 to 31 December 2020 among a list of 84 most popular cocktails selected internally
BEYOND APERITIVO
Campari (10% of Group net sales): -4.5% (1)
> Impacted heavily by the weak Q4 performance, mainly driven by Italy
> Overall declines in core on-premise skewed markets such as Italy, Brazil, Jamaica as well as Spain. GTR also declined
> Italy
> Double-digit growth in the US, the UK, France and Australia as well as solid growth in Germany and Switzerland
> USA
> Strong double-digit sell-out growth in off-premise across the brand's core markets in 2020, such as Italy, Germany, US, Switzerland, Austria and UK
> Germany
> Jamaica
> Brazil
Strong off-premise sell-out of Campari across key markets (2)
CAMPARI: GLOBAL DIGITAL CAMPAIGNS
'RAISE A NEGRONI TO YOUR BAR'
Italy
Germany
US
Switzerland
Austria
UK
-15%
5% 25% 45%Off-premise sell-out value growth in FY 2020Overall shipment value organic growth in FY 2020
65%
Campari and Imbibe Magazine continue to partner together for the 8th year running to present Negroni Week 2020, in celebration of the iconic Campari-based cocktail. Each year, bartenders join forces to raise money for charity during Negroni Week, but this year the focus has shifted to support bartenders and the hospitality industry.
(1) Sales at constant FX. Q4 2020 sales organic growth: -14.1%
(2) US: Nielsen data XAOC+Total Liquor, representing c. 34% of total US off-trade value, YTD W/E 26/12/2020; Germany: Nielsen LEH+DM = Off-Trade (no C&C), W2-W53 2020; Italy: IRI Iper+super+LSP, YTD WE 27/12/2020; UK: Nielsen, YTD W/E 26/12/2020; Austria: Nielsen YTD W52 2020; Switzerland: Nielsen, YTD W/E 26/12/2020
Building a passionate consumer base
PASSION IN CREATIVITY
CREDIBILITY & PREMIUMNESS
PENETRATION & INNOVATION
Premium taste with unique authenticity
Wild Turkey (8% of Group net sales): +4.9% (1)
> Positive growth overall for Wild Turkey bourbon after an acceleration in Q4 driven by the core markets of the US and Australia. This growth was partly mitigated by the double-digit decline in core Japan, due to destocking in connection with the route-to-market change, despite more positive Q4 trends
> In the US, the brand is continuing to catchup to more positive sell-out trends in the off-premise: the Wild Turkey franchise registered +25.6% value growth in 2020 (2)
> American Honey grew +0.9% overall after a more positive Q4 result (+13.7%) thanks to the core US and Australian markets
> US
> Australia
> Japan
> Canada
> UK
(1) Sales at constant FX. Q4 2020 sales organic growth: +29.1%
2021 will also see the elevation of Wild Turkey to its rightful place as the legendary global premium bourbon with a new visual identity and premium packaging update. The new packaging will embody the spirit of Kentucky, representing the utmost quality, authenticity and craftsmanship.
(2) US: Nielsen data XAOC+Total Liquor, representing c. 34% of total US off-trade value, YTD W/E 26/12/2020
SKYY Vodka (7% of Group net sales): -16.2% (1)
> Continued decline in the core US market (-10.5%), driven by destocking ahead of a complete brand relaunch. Flavours continued to be more impacted than the Core
> US
> Germany
> SKYY Vodka off-premise sell-out trends remain positive in the US, growing in value at +7.3% in 2020 (2)
> Argentina
> China
> Internationally, Germany and Argentina registered positive performance, partly offsetting declines in other markets
> Canada
Beyond the Blue
Inspired by San Francisco, the new bottle brings a sophisticated and premium new look. SKYY's new natural liquid twist highlights the importance of water amongst other steps in the process to craft a pure, fresh and smooth liquid for a more compelling and authentic storytelling. Launch in Q1 2021 in core US, with phase out to international markets in H2 2021.
Lighter, Translucent New Glass
New Bottle Closure
Restyled Natural White Logo
New Bottle Shape with
Ocean-Inspired Ridges
ENRICHED WITH PACIFIC MINERALSFILTERED IN CALIFORNIA LIMESTONE
NATURALLY SMOOTH
GLUTEN FREE
(1) Including SKYY infusions. Sales at constant FX. Q4 2020 sales organic growth: -18.5%
(2) US: Nielsen data XAOC+Total Liquor, representing c. 34% of total US off-trade value, YTD W/E 26/12/2020
Grand Marnier (6% of Group net sales): -14.9% (1)
> Overall decline was driven by the negative shipment performance in the core US, impacted by both destocking and the brand's on-premise skew as | > | US |
well as weakness in GTR and France | > | Canada |
> Excluding the US destocking effect, the overall brand performance would have been -2.4% in FY 2020 | > | France |
> The off-premise sell-out trends in the US remain very positive at +37.8% value growth for 2020 (2) | > | Italy |
> | Germany |
With cognac being the most premium category in the spirits industry, Grand Marnier's ambition is to become one of the most recognized and inspiring brands in the premium and above world. With the relaunch of Cuvée Louis Alexandre and Cuvée du Centenaire completed, the new Cuvée Révelation and Quintessence will conclude the full relaunch of Grand Marnier since the acquisition in 2016.
The rarest hors d'âge cognacs, exclusively selected from the Paradis, the personal reserves of the Marnier Lapostolle cellar. Bigaradia orange peels for the first time macerated in cognac and than double distilled
(1) Sales at constant FX. Q4 2020 sales organic growth: -25.6%
(2) US: Nielsen data XAOC+Total Liquor, representing c. 34% of total US off-trade value, YTD W/E 26/12/2020
Jamaican rums (6% of Group net sales): +5.2%(1)
> Appleton Estate registered a positive full year result (+3.1%), sustained by a favourable category trend in the premium rum, driven by the US and Canada, boosted by the new packaging and product range, offsetting the negative performance in Jamaica, Mexico and GTR
> Jamaica
> Wray&Nephew Overproof grew +21.9% overall, thanks to its enduring resilience and continued positive trends in the core markets of Jamaica, the US and the UK. Canada also grew off a small base
> USA
> Canada
> Decline in the rest of the portfolio due to portfolio reshuffle, namely the launch of Kingston 62
> UK
> Very strong off-premise sell-out trends in the US: Appleton Estate (+38.8%) and Wray&Nephew Overproof (+62.2%)(2)
> New Zealand
CRAFTED WITH JOY
In February 2020, the Group initiated the global relaunch of Appleton Estate, the renowned dark aged rum collection. The relaunch includes a new package design which serves to elevate Appleton Estate's presence as a super Premium brand. The new label design, which showcases the Estate's story and celebrates Jamaican culture, is accompanied by the introduction of a cork closure, as well as a contemporary version of the iconic bottle shape. Appleton Estate is also introducing an 8 Year Old minimum aged statement on the Reserve rum.
(1) Sales at constant FX. Q4 2020 sales organic growth: +3.2%
(2) US: Nielsen data XAOC+Total Liquor, representing c. 34% of total US off-trade value, YTD W/E 26/12/2020
Espolòn (5% of Group net sales): +29.9% (1)
Regional priorities
> Continued very positive performance driven by the core US market (+34.2%) after a solid year end (Q4 +33.9%) as the brand continues to benefit from strong category momentum
> Off-premise sell-out trends remain even stronger, at +87.4% value growth in 2020 (2)
> Seeding markets such as Canada, Russia and Australia also grew
ESPOLÒN - MEXICAN INDEPENDENCE
DAY
Espolòn Tequila launched a national digital campaign around Mexican Independence Day week (on 16th September). This campaign was live from September until end of December across various channels and partners, such as Spotify, WeTransfer.com, Hulu, Facebook, Instagram, Twitter, Pinterest and YouTube in unique and innovative ways. But above all, in true Espolòn fashion, the brand is focusing on non-traditional partnerships and creative assets to ensure Espolòn Tequila continues to stand apart from the competitive tequila crowd.
(1) Sales at constant FX. Q4 2020 sales organic growth: +30.1%
(2) US: Nielsen data XAOC+Total Liquor, representing c. 34% of total US off-trade value, YTD W/E 26/12/2020
Brand sales review
Other regional priorities
Regional priorities
Brand sales as % of Group's sales in FY 2020
Organic change in FY 2020
Organic change in Q4 2020
Gin
1%
-11.6% +10.5%
> Overall negative performance driven by GTR and core Spain due to the Covid-19 impact as well as persistent competitive pressures, fully offsetting growth in Germany and Belgium
Whiskies
1%
-19.3% -4.7%
1%
+17.5% +42.4%
> Overall negative, largely driven by the decline in GTR, a key channel for the brand's premium variants development and heavily hit by the pandemic. The performances in Italy, the US and South Africa were negative as well, fully offsetting the positive results in Australia, Germany and France
> Overall positive results largely attributable to core Canada (+20.0%) after an acceleration in Q4 (+42.0%). The US market also registered positive trends in Q4
Italianbitters and liqueurs
3%
-15.6% -9.8%
> Overall negative performance in the on-premise skewed bitters and liqueurs, largely due to declines in core Italy and the US as well as GTR
Sparklingwine& vermouth
3% (1)
-9.3% -10.8%
(1) Incl. Cinzano verrmouth and Cinzano sparkling wines
> Vermouth declined overall by -4.8%, with positive performance in Russia, Argentina and Australia more than offset by declines in Italy and Eastern Europe markets due to brand repositioning
> Sparkling wines were down -12.2% due to declines in core Italy and Russia, fully offsetting the positive results registered in Germany and selected Eastern European markets
3%
+5.3% +2.5%
> Positive performance from Mondoro (+5.6%) largely driven by core Russia
> Riccadonna grew by +5.0% thanks to growth in core France
Brand sales review
Local priorities & others
Local priorities and
Other
1%
+3.1% -34.1%
> X-Rated Fusion Liquor registered very solid growth in the core Chinese market overall, despite new route-to-market setup, while core South Korea declined temporarily, due to on-premise restrictions linked to Covid-19, while underlying consumption trends remain solid
Brand sales as % of Group's sales in FY 2020
Organic change in FY 2020
Organic change in Q4 2020
3%
-15.7% -30.2%
3%
-20.4% -32.6%
2%
+22.5% +10.5%
1%
+11.1% +8.1%
1%
+19.0% +47.5%
> Overall decline due to on-premise restrictions impacting core Italy
> Similarly, strong decline due to on-premise restrictions in core Italy
> In seeding markets, the brand grew overall by mid-single digit thanks to the performance in Switzerland, Belgium, Austria and Germany, benefiting from the new brand roll-out
> Strong performance in core Australia
> Very positive results driven by core Germany
> Strong growth driven by the core US, benefiting from very positive category momentum with an acceleration in Q4
2020 brand and global campaign roll-outs
With the aim of reinforcing the presence of Campari Group in the Non-Alcoholic category, the original non-alcoholic drink and aperitif, Crodino, has been launched outside of Italy with a brand new mix.
The brand underwent roll-outs in European markets (Netherlands, Belgium, Greece, UK, Switzerland, Romania) and will be progressively extended in other relevant markets.
`
In March 2020, Jamaica was first of the global markets to introduce Kingston 62, a new standard rum proposition offering both a gold aged and white aged rum. Kingston 62 pays tribute to Jamaica's emergence as an independent nation in 1962.
AVERNA: OPEN SICILY
Averna has launched its first ever global campaign, 'Open Sicily', which celebrates the vibrant world of Sicily and the modern expressions of the island with new an updated and modernised brand identify, packaging and communication. Watch the TV Commercial here:https://www.youtube.com/watch?v=aN11tZ9iHR8
GlenGrant Arboralis (Latin for light from within trees) was launched across key markets. This whisky gives a new premium non-aged entry point to the GlenGrant portfolio, elevating the brand portfolio with a product that links closely to our aged range, in quality and style.
The whisky is matured in quality ex-bourbon and ex-sherry casks in Speyside, delivering a fresh and inviting fruity single malt with intriguing depth.
BISQUIT&DUBOUCHÉ
Following the first production in late 2019, Bisquit&Dubouché new VS and VSOP hit the shelves in the key Belgian market this spring, gaining visibility thanks to strong in-store theatralisation and personalized displays.
Table of contents
Results Summary
Sales Results ‒ By region ‒ By brand
Operating Results by Region Consolidated P&L
Cash Flow & Net Financial Debt Corporate Initiatives Sustainability Roadmap Conclusion & Outlook Annex
Net Sales & EBIT analysis by region
Net Sales breakdown by region
AmericasSouthern Europe, Middle
East & Africa
North, Central & Eastern
Europe
Asia Pacific
EBIT (1) breakdown by region
AmericasSouthern Europe, Middle
East & Africa
North, Central & Eastern
Europe
Asia Pacific
• The Americas remain the Group's largest region in terms of net sales and profitability (43.7% of Group's net sales and 43.4% of Group's EBIT(1) in FY 2020).
• SEMEA, the region hit most heavily by Covid-19 given its strong exposure to the on-premise (in particular, high-margin aperitifs) and GTR, largely reduced its weight vs. FY 2019
(1) EBIT adjusted
EBIT (1) by region - Americas
FY 2020 € million % of salesNet sales Gross profit A&P SG&A EBIT (1)
773.9 429.4 (141.2) (148.5) 139.7
100.0% 55.5% -18.2% -19.2%
FY 2019 € million % of sales
821.5 479.7 (157.3) (151.0)
18.1% 171.4
Reported change %Organic change %
100.0% 58.4% -19.1% -18.4% 20.9%
-5.8% -1.8%
-10.5% -9.3%
-10.2% -8.3%
-1.7% +3.5%
-18.5% -21.6%
20.9%
+130 bps
Organic change -420 bps (2)
+140 bps
18.1%
EBIT margin FY | FX & Perimeter | EBIT margin FY |
2019 | 2020 |
Gross margin
A&P
SG&A
> Organic change:
EBIT adjusted organic decline of -21.6% with -420 dilution (or -10.5%, -250 bps excluding the US destocking). Key drivers:
Gross Profit
• Decline of -9.3% in value, stronger than sales, leading to -450 bps margin dilution, mainly due to unfavorable brand and channel mix in the US, in particular, the outperformance of Espolòn with margin continuing to be dampened by the elevated agave purchase price, severe destocking in high-margin brands (SKYY Vodka and European imports) as well as negative impact from the US import tariffs
A&P
• A&P decreased by -8.3% in value, more than topline, leading to +130 bps margin accretion, driven by a combined effect of cost mitigation initiatives, shift of investments from offline to online as well as phasing for key global priorities (SKYY Vodka, ahead of complete brand relaunch)
SG&A
• Slight increase in SG&A (+3.5% in value), -100 bps margin dilution, mainly due to the lower absorption of fixed structure costs
> FX & Perimeter:
• Positive FX effect largely driven by the strong depreciation of currencies of low-margin markets such as Brazilian Real, Argentine Peso and Mexican Peso, offsetting the slightly negative perimeter effect. Overall accretive on EBIT margin by +140 bps
(1) EBIT adjusted
(2) Bps rounded to the nearest ten
EBIT (1) by region - SEMEA
17.7%
FY 2020 € million % of salesFY 2019 € million % of sales
Reported change %Organic change %
Net sales Gross profit A&P SG&A
EBIT (1)
463.6 279.4 (90.6) (156.3) 32.5
100.0% 60.3% -19.5% -33.7% 7.0%
498.7 333.1 (89.2) (155.8) 88.1
100.0% 66.8% -17.9% -31.2% 17.7%
-7.0% -18.6%
-16.1% -20.1%
+1.6% +0.4%
+0.4% -10.1%
-63.2% -58.8%
EBIT margin FY
Gross margin
A&P
SG&AFX & Perimeter
20 19
EBIT margin FY 20 20
> Organic change:
EBIT adjusted strong organic decline, heavily impacted by Covid-19, in particular the high-margin aperitif business in Italy. Key drivers:
Gross Profit
• Decline of -20.1% in value, stronger than sales, leading to -130 bps margin dilution, due to unfavorable sales mix driven by on-premise closures hitting in particular the high-margin aperitifs business in Italy, combined with lower absorption of fixed production costs
A&P
• A&P broadly stable (+0.4% in value), driving a -420 bps dilution, reflecting sustained marketing investments behind key brands (such as Venice Film Festival sponsored by Campari and Averna new campaign launch) with a gradual recovery of key initiatives in the second part of the year
SG&A
• SG&A decreased by -10.1% in value but remained significantly dilutive (-330 bps), as a consequence of lower absorption of fixed structure costs given the strong topline decline. The dilution was partly mitigated by cost containment actions reducing variable structure cost (incl. travelling expenses, hiring freeze, bonuses)
> FX & Perimeter:
• Slightly positive FX effect, fully offset by the negative perimeter effect, due to the disproportional effect from the first-time consolidation of the French distributor and the Rhum Agricole business, with the latter negatively impacted by the increased raw materials costs and the Covid-19 due to its on-premise skew. Overall dilutive on EBIT margin by -200 bps
(1) EBIT adjusted
(2) Bps rounded to the nearest ten
EBIT (1) by region - NCEE
FY 2020
€ million % of salesNet sales Gross profit A&P SG&A
403.7 255.9 (60.4) (62.3) 133.2
100.0% 63.4% -15.0% -15.4%
EBIT (1)
33.0% 132.9
FY 2019
€ million % of sales
393.8 248.5 (55.6) (60.0)
Reported change
%Organic change
%
100.0% 63.1% -14.1% -15.2% 33.7%
+2.5% +6.8%
+3.0% +5.4%
+8.7% +10.0%
+3.7% +6.1%
+0.3% +3.2%
33.7%
+10 bps
+40 bps
33.0%
Gross margin
EBIT margin FY 2019
A&P
SG&AFX & PerimeterEBIT margin FY 2020
> Organic change: | EBIT adjusted organic growth of +3.2%, lower than sales growth, leading to -110 bps dilution. Key drivers: |
Gross Profit | • Increase of +5.4% in value, slightly lower than sales, generating -80 bps dilution, driven by unfavorable geographic sales mix (in particular, the outperformance of Russia) |
A&P | • A&P increased by +10.0% in value, leading to -40 bps dilution, with sustained marketing investments behind key brands, accelerating in the second half of the year |
SG&A | • SG&A increased by +6.1% in value, slightly lower than sales, generating +10 bps accretion |
> FX & Perimeter: |
• Negative FX effect mainly attributable to the depreciation of Russian Ruble, and negative perimeter effect mostly due to termination of low-margin agency distribution contracts. Overall accretive on EBIT margin by +40 bps
(1) EBIT adjusted
(2) Bps rounded to the nearest ten
EBIT (1) by region - Asia Pacific
FY 2020 € million % of salesNet sales Gross profit A&P SG&A
EBIT (1)
130.8 61.3 (17.6) (27.2) 16.5
100.0% 46.8% -13.5% -20.8% 12.6%
FY 2019 € million % of sales
128.5 60.0 (17.8) (26.5) 15.6
Reported change %Organic change %
100.0% 46.6% -13.9% -20.6% 12.1%
+1.8% +4.6%
+2.2% +5.1%
-1.2% +1.5%
+2.3% +5.1%
+5.8% +9.1%
12.1%
+20 bps
+40 bps
-10 bps
Organic change +50 bps (2)
0 bps
12.6%
EBIT margin FY 2019
Gross marginA&P
SG&AFX & PerimeterEBIT margin FY 2020
> Organic change: | EBIT adjusted organic growth of +9.1%, higher than sales growth, generating +50 bps accretion. Key drivers: |
Gross Profit | • Grew by +5.1% in value, ahead of sales, leading to +20 bps accretion, driven by favorable sales mix by brand within the region and improved profitability of the local |
priorities in Australia | |
A&P | • Slightly up in value (+1.5%), generating +40 bps margin accretion |
SG&A | • Increased by +5.1% in value, slightly dilutive on margin (-10 bps), mainly due to costs related to route to market initiatives and the transfer of the regional offices from |
Sydney to Singapore | |
> FX & Perimeter: | • Neglectable fx and perimeter effect |
(1) EBIT adjusted
(2) Bps rounded to the nearest ten
Table of contents
Results Summary
Sales Results ‒ By region ‒ By brand
Operating Results by Region Consolidated P&L
Cash Flow & Net Financial Debt Corporate Initiatives Sustainability Roadmap Conclusion & Outlook Annex
EBIT adjusted
FY 2020 Q4 2020 FY 2020 € million % of salesFY 2019 € millionRecphoarntgedeOrganic changeForexPerimeter effect impact Organic change % of sales % % % % % | |
Net Sales Gross Profit 1,772.0 1,025.9 100.0% 57.9% 1,842.5 1,121.2 100.0% 60.9% -3.8% -8.5% -4.1% -2.7% 3.0% -8.5% -1.3% A&P -2.3% 1.3% Contribution after A&P SG&A (1) -10.6% -11.0% -0.9% 1.3% | (309.8) 716.1 (394.2) -17.5% 40.4% -22.2% (319.9) 801.3 (393.3) -17.4% 43.5%-21.3% -3.1% 1.3%-2.2% 0.2% -1.4% -3.2% 4.8% -7.0% -12.1% 10.5% -20.9% -7.1% |
EBIT adjusted 321.9 18.2% 408.0 22.1% -21.1% -20.4% 1.4% -2.1% -33.0% | |
EBITDA adjusted 399.9 22.6% 479.8 26.0% -16.7% -16.3% 0.6% -0.9% -27.5% |
Organic
€million
408.0
(6.0)
(19.0)
12.0
(19.0)Margin/ bps (2)
FY 2019
AgaveUS tariff
(1) SG&A = selling, general and administrative expenses
(2) Bps rounded to the nearest ten
US price increaseDestockingGross profit (excl. external factors)
A&PSG&AFXPerimeterFY 2020
EBIT adjusted
> Gross profit: on a reported basis down -8.5% in value, to 57.9% on sales (-300 bps dilution):
• Organic change of -8.5% in value, leading to -280 bps margin dilution (Q4: -12.1% in value, -320 bps dilution), due to unfavorable sales mix, mainly driven by the following: the outperformance of lower-margin Espolòn, which continues to be impacted by the elevated agave purchase price, the underperformance of high-margin aperitifs in core Italy, the destocking-driven declines in high-margin SKYY Vodka and European imports in the US and the negative impact of the US import tariffs, as well as the lower absorption of fixed production costs
• Negative Forex impact was mitigated by positive perimeter effect, combined -20 bps margin dilution
> A&P: on a reported basis down -3.1% in value, to 17.5% on net sales (-10 bps dilution)
• Organic decrease of -2.2% in value, driving -30 bps margin dilution (Q4: +10.5%, -310 bps dilution), reflecting the phasing of the brand activation initiatives with the second half recovering the initial cost containment actions taken
• Forex and perimeter combined effect of -1.0% in value, +20 bps margin accretion
> SG&A: stable on a reported basis (+0.2% in value), to 22.2% on net sales (-90 bps dilution)
• Organic change of -1.4% in value, -60 bps margin dilution, as a consequence of lower absorption of fixed structure costs given the stronger topline decline. The dilution was partly mitigated by cost containment actions aimed at reducing variable and discretionary costs (incl. hiring freeze, reduction of travelling, entertainment and bonuses During Q4, SG&A reduced by -7.1% in value, in line with topline decline (-7.0%), neutral on margin
• Forex and perimeter combined effect of +1.6% in value, lower than topline change, leading to -30 bps margin dilution, primarily driven by the first-time consolidation of the new businesses
> EBIT adjusted: on a reported basis down -21.1% in value, to 18.2% on net sales (-400 bps dilution)
• Organic decline of -20.4% in value with -380 bps margin dilution (Q4: -33.0%, -620 bps dilution), largely due to the negative sales mix and lower absorption of fixed structure costs given the topline decline. Excluding the US destocking effect (ca. €19 million, -80 bps dilution), the EBIT adjusted organic change would have been -15.7% (-300 bps)
• Forex and perimeter combined effect of -0.7% in value, corresponding to -20 bps margin dilution
Note: Bps rounded to the nearest ten
Operating adjustments | |
FY 2020 | |
€million | |
Intangible assets impairment losses | (35.4) |
Transaction fees (re-domiciliation, M&A, route-to-market) | (15.9) |
Restructuring costs (incl. sugar business in Jamaica) | (21.4) |
Covid-19 donations and others | (17.4) |
Total Operating adjustments | (90.1) |
> Total operating adjustments of €(90.1) million, of which: |
• €(35.4) million attributable to brand impairment losses, of which Bulldog (€16.0 million (1)), The GlenGrant (€15.5 million) and Rhum Agricole (€3.9 million (2)), as a consequence of the negative impact of Covid-19 on the brands' performances, particularly given their relevant exposure to the Global Travel Retail and on-premise, not expected to fully recover in the short term
• €(15.9) million in connection with the Company's legal office transfer to the Netherlands (€9.9 million), as well as fees linked to route-to-market changes and M&A (€6.0 million)
• €(21.4) million of restructuring costs related to the sugar business in Jamaica for €13.5 million and reorganisation activities impacting some of the Group's central operations, which were started in previous periods, for €7.9 million
• € (17.4) million of other costs, mostly related to donations made by the Group to fight the pandemic, some special projects, legal disputes, as well as costs connected to IT restoring operations following the malware attack in November 2020
(1) Value determined based on average exchange rate for the period 1 January-31 December 2020
(2) Reflecting the brand value derived from the final Purchase Price Allocation ('PPA'), where the brand value was reduced by €0.8 million vs. the brand value derived from the provisional PPA as of 30 September 2020
Profit before tax
FY 2020
FY 2019
Reported change
€million
% of sales
€million
% of sales
%
EBIT adjusted Operating adjustments Operating profit = EBIT
321.9 (90.1) 231.8
Net financial income (charges) (1) Adjustments to financial income (charges)
(38.9)
Profit (loss) related to associates and joint ventures
Put option, earn out income (charges), hyperinflation effects and other (2)
1.4 (2.8) 18.1
18.2% -5.1% 13.1% -2.2% 0.1% -0.2% 1.0%
408.0 (21.7) 386.3
22.1% -1.2% 21.0%
(33.0) -1.8% 5.8 0.3% 0.1 0.0% (4.7) -0.3%
-21.1% - -40.0% 17.9% - - -
Profit before tax
Profit before tax adjusted
209.6 278.9
11.8% 354.6 19.2% -40.9%
15.7%
370.4
20.1% -24.7%
(1) Including €4.1 million fx loss in 2020 vs. €2.8 million fx gain in 2019
(2) Including €19.4 million non-recurring earn-out revisions in 2020
> Net financial charges were €38.9 million in FY 2020, €5.9 million higher vs. FY 2019, mainly due to a negative variance from exchange gain/(loss) for €6.9 million (€4.1 million loss in 2020 vs. €2.8 million gain in 2019)
• Excluding the exchange gain/(loss) effects, the net financial charges showed a saving of €1.0 million despite the higher average net debt in 2020 (€979.6 million vs. €865.8 million in 2019), thanks to a lower average cost of net debt (3) (3.5% in 2020 vs. 4.1% in 2019), with both periods impacted by significant negative carry effect. The decrease of the cost of net debt is mainly attributable to the reduced average coupon on existing gross debt, thanks to the liability management activities, further strengthened by the €550 million bond issue completed on 6 October 2020, which led to a decrease in the average cost of nominal coupons of bonds and term loans from 2.15% to 1.42%
> Put option and earn out income (expenses) was positive at €18.1 million, primarily attributable to the revision of projected earn-out liabilities linked to the Bulldog acquisition (€19.4 million)
> The profit (loss) related to associates and joint ventures was €(2.8) million, mainly related to the joint venture in Japan impacted by the lower absorption of fixed structure cost in a context of low sales level
> Profit before tax was €209.6 million, down -40.9%. Profit before tax adjusted was €278.9 million, down -24.7%
(3) Excluding FX effects, ancillary financial expenses and financial adjustments
Group Net Profit adjusted
€million
Profit before taxTotal taxation Net profit
(1)
Non-controlling interests Group net profit
Tax rate (reported / recurring effective)
Deferred tax on goodwill and brands Recurring cash tax rate
Reported Adjustments
209.6
(22.7) 186.9 (1.0) 187.9 -10.8%
FY 2020
(69.3)
(14.2) 201.1
(14.2) 202.1
(13.1) (13.1)
55.1 (77.9)
- (1.0)
- -27.9%
FY 2019
Reported
AdjustmentsAdjusted
(46.2) 308.4 (0.0) 308.4 -13.0%
354.6
(15.8) 370.4 56.8 (103.1)
41.0 267.4 - Financial adjustments
- (0.0) 41.0 267.4
- -27.8% (15.8) (15.8)
-23.2%-23.5%
Adjustments details: € million
Actual FY 2020
Actual FY 2019
Total operating, financial & Earn-out adjustments, of which:
(69.3) (15.8)
- Operating adjustments (90.1) (21.7)
- Earn-out non-recurring revisions Total tax adjustments, of which:
- Tax benefit from Italian Legislative Decree n.104/2020
- Patent box
- Fiscal effects on adjustments and other fiscal adjustments
1.4 5.8 19.4 0.0 55.1 56.8 29.9 0.0 0.0 25.4 25.2 31.4
Total adjustments
(14.2) 41.0
(1) | Including deferred tax on goodwill and brands |
> | Taxation totalled €22.7 million on a reported basis in FY 2020, while recurring income taxes were equal to €77.9 million due to positive tax adjustments totalling €55.1 |
million, including a one-off benefit of €29.9 million related to the remeasurement of deferred tax liabilities as a result of the step-up of the fiscal values of certain brands and | |
goodwill to their corresponding book values (2) | |
> | Group net profit adjusted at €202.1 million, down -24.4% vs. FY 2019: |
> | |
> |
Basic earnings per share adjusted (3) at €0.18 (vs. €0.23 in FY 2019)
• Recurring effective tax rate at 27.9% in FY 2020, broadly in line with FY 2019
• Adjusting the recurring effective tax rate for the goodwill deferred taxes, recurring cash tax rate at 23.2% in FY 2020, slightly down compared with last year (23.5% in FY
2019)
Group net profit at €187.9 million, down -39.1% vs. FY 2019
(2) The positive reversal of deferred tax liabilities recorded in 2020 income statement is net of the substitutive tax to be paid in order to access the fiscal benefit. This benefit is granted to Italian companies pursuant to Law no.126/2020
(3) Based on the weighted average number of ordinary shares outstanding during the year, excluding treasury shares. The number of shares used for the FY 2020 calculation: 1,133,816,568. Refer to annex 5 'FY 2020 EPS adjusted: basic and diluted' for details
Table of contents
Results Summary
Sales Results ‒ By region ‒ By brand
Operating Results by Region Consolidated P&L
Cash Flow & Net Financial Debt Corporate Initiatives Sustainability Roadmap Conclusion & Outlook Annex
Free cash flow
EBITDA (148.3) -32.4%
FY 2020 | FY 2019 | Δ FY2020 vs. FY2019 | Δ FY2020 vs. FY2019 |
Total Recurring | Total Recurring | Total | Recurring |
€ million € million | € million € million | ||
309.8 | 458.1 |
€ million
%
€ million
%
EBITDA adjusted Other non-cash items Taxes paid
399.9 479.8 (79.9) -16.7%
38.7 (119.7)
Change in OWC (at constant FX and perimeter)
Cash flow from operating activities
43.4 272.2
(7.0) (84.8) 43.4 351.5
(20.3) (45.3) (29.6) 363.0
(12.8) (81.1) (29.6)
59.0 5.8
(74.4) (3.7) 73.0 73.0
356.3 (90.7) -25.0% (4.8) -1.3%
Financial income (expense), of which Net interest paid
(23.8)
(25.3)
(22.1)
(27.9)
(1.8) 2.7
(25.3)
(25.3)
(27.9)
(27.9)
2.7 2.7
Financial adjustments Capex
1.4
0.0
5.8
0.0
Free Cash Flow (FCF)
(79.8) 168.6
(64.6) 261.7
(82.4) 258.5
(61.1) 267.3
(4.4) 0.0 2.7 (3.4)
(89.8)
-34.8% (5.6) -2.1%
> Free cash flow at €168.6 million, down €(89.8) million vs. FY 2019. Recurring free cash flow at €261.7 million, down €(5.6) million vs. FY 2019. Key drivers:
• EBITDA decreased by €148.3 million and included a negative effect of €90.1 million related to operating adjustments mainly for restructuring projects and the transfer of the Company registered office to the Netherlands. Decrease in EBITDA adjusted of €(79.9) million, negatively impacted by Covid-19
• Non-cash items of €38.7 million, mainly including the non-recurring impairment losses of €45.7 million attributable to brand devaluations for Bulldog, The GlenGrant and Rhum Agricole, as well as write-off of some tangible assets and hyperinflation effects
• Tax paid of €(119.7) million in FY 2020, including the non-recurring tax payment made in 2020 in connection with the sale of Villa Les Cèdres for €60.1 million (transaction completed in 2019) and tax relief obtained under Patent box tax regime (residual amount based on fiscal year 2019). Excluding the non-recurring items, the recurring taxes paid were equal to €(84.8) million, broadly in line with the recurring taxes in 2019
• Reduction of the OWC(1) generated a positive cash effect of €43.4 million in FY 2020 (compared to a negative effect of €29.6 million in FY 2019), driven by phasing effects generated by the renewed restrictions impacting business performance
• Financial expenses of €23.8 million in FY 2020, of which recurring financial expenses of €25.3 million
• CAPEX (2) of €79.8 million in FY 2020, of which maintenance CAPEX of €64.6 million
> Recurring FCF / EBITDA adjusted of 65.4% in 2020, up from 55.7% in FY 2019, driven by a temporary working capital reduction at year-end
(1) Refer to slide 44 'Operating working capital' for details
(2) Refer to slide 45 'CAPEX' for details
Operating Working Capital(1)
(43.4)
OWC at 31/12/2019 (2)
Organic
Forex
Perimeter
% on sales
OWC at 31/12/2020 34.8%
> OWC decrease of €74.9 million as of 31 December 2020 vs. 31 December 2019 (2). Key drivers:
• Organic decrease of €43.4 million, due to:
- Increase in inventory of €47.7 million, of which ageing liquid increase of €20.1 million, mostly linked to The GlenGrant and Bisquit cognac maturing inventory. The other inventory increase is mostly a consequence of weaker demand towards the end of year due to Covid-19
- Decrease in receivables of €42.0 million as a consequence of the business slowdown in Q4 in connection with the pandemic 'second wave'. Notwithstanding the unfavourable economic environment, customer payments terms remained broadly unchanged across all geographies
- Increase in payables of €49.2 million, due to phasing
• Forex impact of €(61.4) million, due to the depreciation of other Group currencies vs. Euro
• Perimeter effect of €29.8 million due to the consolidation of the French distributor and Champagne Lallier
> OWC as % of net sales at 34.8% as of 31 December 2020 (or 33.2% taking into account the twelve-month sales effect of the acquired businesses), down by 280 bps compared with 2019 year end
(1) Refer to Annex 11 'Operating working capital' for details
(2) Reclassified for purchase price allocation of the acquisitions of Rhumantilles S.A.S. and Licorera Ancho Reyes y Cia S.A.P.I. de C.V. & Casa Montelobos S.A.P.I. de C.V.
CAPEX
FY 2019 actual
FY 2020 guidance(1)FY 2020 actual
FY 2021 guidance
€ million
€ million
€ million
€ millionMaintenance capex (net of barrel disposal)
Extraordinary capex (incl.new offices, brand houses and other projects)
61.1 21.3 82.4
64 30 94
64.6 15.1 79.8
~ 60
Total capex
~ 40 ~ 100
(1)Guidance provided upon the Group's FY 2019 financial results release on 18 February 2020
> Total capex investment was equal to €79.8 million in FY 2020, of which:
• €64.6 million maintenance capex, related to initiatives aimed at continually enhancing the efficiency of the Group's industrial plants, offices and infrastructure
• €15.1 million extraordinary capex, mainly related to new offices opening, brand houses and product innovation projects. Overall, ca. €15 million below the initially planned, as some projects were postponed due to Covid-19
> For FY 2021, maintenance capex is expected to be at approximately €60 million and extraordinary capex at approximately €40 million reflecting new investments on extra projects (incl. brand houses and other projects), as well as projects carry forward from 2020
Net debt increase largely driven by share buyback and M&A(1)
Net debt at 31/12/2019
FCF
Net value from disposals & acquisitions
>
Net financial debt at €1,103.8 million as of 31 December 2020, up €326.4 million vs. 31 December 2019 (€777.4 million), mainly driven by a combined effect of:
- Positive free cash flow generated by the business for €168.6 million(2) (or €261.7 million on a recurring basis)
- Substantial payments commitments for an overall amount of €(459.1) million, including acquisitions of the French distributor and Champagne Lallier, the investment in Tannico, the share buyback(3)(4) (which included €64.7 million for the buyback of withdrawn shares in the context of the re-domiciliation) and dividend payments
> Net debt to EBITDA adjusted ratio at 2.8x as of 31 December 2020, up from 1.6x as of 31 December 2019. The increase is the combined effect of the significant cash outlay incurred by the Group as a result of the transactions completed in 2020 and the temporary negative impact of Covid-19 on EBITDA adjusted
(1) Please refer to Annex 10 'Financial debt details' for further information
Dividend
(2) Including the tax payment for previous non-core real estate disposal (Villa Les Cèdres) of €60.1 million
(3) Refer to the press release published on 24th February 2020 for additional details
Purchase of own shares
Others
(4) Considering the spot price per share at 31 December 2020 of €9.34, a theoretical gain of €45.3 million on these shares purchases is implied within the Group's equity
Net debt at 31/12/2020
Debt maturity(1)
>
Net debt of €1,103.8 million as of 31 December 2020
> Long-term Eurobonds & term loan amounted to €1,150 million:
• Average nominal coupon of 1.42%
• Fixed interest rate debt accounts for ca. 78% of the overall gross debt
Net debt maturity as of 31 December 2020 (€million)
2021
2022
2023
2024
>= 2025
(2)
Cash and cash equivalentsEurobonds and Term LoanLiabilities for put option and earn out paymentsBank loanOthers
(1) Refer to Annex 10 'Financial debt details' for further informatinon
(2) Mainly related to leasing
Table of contents
Results Summary
Sales Results ‒ By region ‒ By brand
Operating Results by Region Consolidated P&L
Cash Flow & Net Financial Debt Corporate Initiatives Sustainability Roadmap Conclusion & Outlook Annex
Group developments - Digital Transformation
> The Group has accelerated its digital transformation journey, enabling business strategy & value creation through digital technology adoption
Empowering our sales teams with data and
technology to enable focus and efficacy with
customers
Developing digitally rich consumer journey's and engagements powered by data insights
Leveraging technology to develop a modern workplace for Camparistas
Automation of standard processes to deliver efficiencies & re-focus of internal teams
Implementing sensors to capture "live" manufacturing line data and traceability
Business developments - increased focus on Asia
China - Aperol market exploration update and New distributor
>
Aperol exploration: micro battles update
• The micro-battles, aimed to gather consumer insights and help define the brand's playbook in China, gradually took place within key cities across bars and restaurants (with a focus on western-style venues as initial test) in the second half of 2020, delayed by half year compared with the initial plan due to the pandemic
• With very positive initial consumer and trade feedback, the Group has finalized its preliminary assessment on the size of the opportunity and is currently fine tuning the go-to-consumer strategy for future scale up
> New distribution partner - Telford
• Effective from 1 March 2021, Telford will take full control of the Group's portfolio for distribution in Mainland China
• Telford, a family owned and run distributor of internationally renowned beverages, wines, spirits and beers in Hong Kong and Mainland China, has a large presence in on/off premise outlets, including premium and super premium hotel and restaurant chains, as well as a significant presence in e-commerce
South Korea - anticipated controlling interest gained in the Joint Venture
>
To better exploit the growth potential of the South Korea market, the Group has re-negotiated the contract terms of its joint venture with Trans Beverages Co. Ltd (established in 2018) in order to gain a controlling interest ahead of the originally planned schedule with an early exercise of the call option
> Consequently, the Group has gained a controlling interest of 51% (from the previous 40% holding) as of January 2021 and the full ownership will be subject to a call option exercisable in 2024
New Zealand - distributor change and supply chain enhancement
> At the beginning of 2021, the Group has changed one of the distribution partners to Thirsty Camel Limited in New Zealand
> In addition, the Group has opened an own warehouse to smooth supply in anticipation of future business growth
Table of contents
Results Summary
Sales Results ‒ By region ‒ By brand
Operating Results by Region Consolidated P&L
Cash Flow & Net Financial Debt Corporate Initiatives Sustainability Roadmap Conclusion & Outlook Annex
Our People: the most important asset to invest
Signature mix: Seizing Opportunities, Inspiring Ownership, Growing Every Day, and Achieving Together
> Campari Group considers the people's health, integrity and well-being as primary and fundamental elements
> Over the years the Group has steadily improved the employees' trust index (shown in the Group's global biennial employee survey in collaboration with the Great Place to Work® Institute)
Biennial global employee survey results vs. global FMCG and Italian Multinational Companies ('MNCs')
Our commitment and focus areas
>
Inclusion, Equity&Diversity: a new strategy to foster inclusion, Equity&Diversity in the workplace with intentional commitment, supported by an internal multi-functional governance at all organizational levels. Monitoring the progress through an internally developed Campari Group Inclusion, Equity&Diversity Index built on people-survey based(1) and GRI-based(2) KPIs, the Group will develop action plans in the field of Culture (focus on education) and Power Acts (focus on concrete initiatives)
> Learning: new paradigm around personal and organizational development, based on pervasive growth mindset, highly enhanced learning offer, and a brand-new digital ecosystem to allow anytime/anywhere learning experience: the Learning Distillery, a one-stop-shop for all Camparistas
>
Employee Share Ownership Plan: a breakthrough reward and engagement program to allow Camparistas to become Company shareholders, awarding our culturally strong sense of belonging. All employees will be offered the opportunity to elect for certain amounts of their salaries and receive free award of matching shares after three years of vesting. During 2021, Camparistas will be also granted the free right to receive una tantum a number of Company's shares after three years of vesting (3)
(1) A selection of Great Place to Work® statements, describing the key dimensions that underpin an inclusive, equitable and diverse workplace
(2) A selection of KPIs as per GRI Sustainability Reporting Standard, the guidelines set by the Global Reporting Initiative ('GRI') establishing the most advanced standard for sustainability reporting mostly used by companies around the world
(3) The resolution is subject to the approval of the Annual General Meeting on 8th April 2021
Responsible Practices: communication, serving and sourcing
Further education and involvement on responsible drinking
For more information visithttps://www.camparigroup.com/en/page/sustainability/sustainability-report
Our commitment and focus
> Educational sessions on responsible drinking for 100% of the Camparistas
> Ad hoc and continuous training for global marketing community (based on our Code on Commercial communication) with a deep dive on digital communication
> Responsible serving projects for bartenders to be leveraged at global level
> Digital brands' campaigns on responsible drinking
The Environment
Responsible use of resources and reduction of the environmental impact
> The Group highly promotes the responsible use of resources and reduction of the environmental impact of its production activities, and over the years, the Group has managed to steadily improve key indicators in terms of waste production, water use and Green House Gases (GHG) emissions
Energy and Green House Gases (GHG) emissions:
> Reduce GHG emissions from direct operations(2) by 20% in 2025, by 30% in 2030 and from the total Supply Chain by 25% in 2030
> 100% Renewable electricity for European production sites by 2025
Total GHG em. from direct operations(2)
(Gg of CO2 e.)
Our commitment and focus (1)Water:
> Reduce Water Use (L/L)(3) by 20% in 2025 and by 25% in 2030
> Continue to ensure the return of 100% Wastewater from our operations to the environment safely
Performance of Water Usage (L/L)
Waste management:
>
Zero Waste to Landfill by 2025
(3)
Waste to landfill (tons/000)
2018
2018
2019
2020
(1)
(2) Including scope 1 and scope 2 emissions. Scope 1: greenhouse gas emissions from owned or controlled sources; Scope 2: greenhouse gas emissions from purchased or acquired electricity, steam, heat and cooling
(3)
2025
2030
Targets calculated using 2019 as a baseLiters of water used for a liter of product manufactured
2019
2020
2025
Community Involvement
Exporting best practices across key markets
> Culture and education continued to be key elements of the Group's DNA. In particular, the Company name has continued to be associated with the world of art, design and cinema
> In 2020, the Group was actively participating to the charitable activities (e.g. donations)
in the fight against the pandemic by supporting business partners, consumers and hospitals in its main markets
Our commitment and focus areas
> Strong commitment to work, education and culture will continue to be key for the Group
> Best local practices (such as Ad Astra Project and Camparista Dream Coach) will be exported in other geographies across the world
> Continuous involvement in the world of art, through sponsoring major events, collaboration with renowned artists (such as Oliviero Rinaldi for Infinito Campari) and further developing iconic brand houses and the Campari Gallery
> Strong support to business partners through activations and events (as the Negroni Week), being committed to play a major role in the comeback of the on-premise channel
For more information visithttps://www.camparigroup.com/en/page/sustainability/sustainability-report
Table of contents
Results Summary
Sales Results ‒ By region ‒ By brand
Operating Results by Region Consolidated P&L
Cash Flow & Net Financial Debt Corporate Initiatives Sustainability Roadmap Conclusion & Outlook Annex
Looking forward: cautious confidence in the short-term and optimistic about the buoyant long-term business momentum
> 2020 performance showed strong business resilience and brand momentum in key off-premise brand-market combinations, as supported by sustained consumption trends
> Looking into 2021 and beyond: > Organic:
• Our brands are very healthy with strong consumer pull. Concomitantly, we remain cautious due to the uncertainty related to the on-going restrictions and the vaccine roll-out affecting on-premise channel across all geographies as well as Global Travel Retail
• Home consumption is expected to remain sustained, fueled by continuous marketing investments, driving the performance in particular in key off-premise markets. With destocking activities completed in the US market, the shipments are expected to progressively align with consumption trends
• We continue to leverage the digital and on-line investments, alongside dynamic omni-channel approach, rapidly adapting to the 'new-normal' environment, particularly e-commerce
• We remain confident about the long-term consumption trends and growth opportunities, as well the strength and resilience of our brands
> Perimeter and FX are expected to negatively impact the Group's EBIT adjusted in 2021 by approx. €(9) million (mainly termination of agency brands) and €(13) million (1) (weak USD dollar as well as emerging markets currencies) respectively
(1) Based on an estimated average rate of EUR/USD of 1.21 in FY 2021
Table of contents
Results Summary
Sales Results ‒ By region ‒ By brand
Operating Results by Region Consolidated P&L
Cash Flow & Net Financial Debt Corporate Initiatives Sustainability Roadmap Conclusion & Outlook Annex
Annex - 1 | Net sales by region and key market |
Annex - 2 | Net sales by brand cluster |
Annex - 3 | FY 2020 consolidated income statement |
Annex - 4 | Q4 2020 consolidated income statement |
Annex - 5 | FY 2020 EPS adjusted: basic and diluted |
Annex - 6 | Balance sheet at 31 December 2020 - Invested capital and financing sources |
Annex - 7 | Consolidated balance sheet at 31 December 2020 - Assets and Liabilities |
Annex - 8 | FY 2020 cash flow |
Annex - 9 | FY 2020 consolidated cash flow statement |
Annex - 10 | Financial debt details |
Annex - 11 | Operating working capital |
Annex - 12 | Exchange rates effects |
Net sales by region & key market
FY 2020 €m % FY 2019 €m % | Change % | of which: organic perimeterforex |
Americas Southern Europe, Middle East & Africa North, Central & Eastern Europe Asia Pacific T otal 773.9 463.6 403.7 130.8 1,772.0 43.7% 26.2% 821.5 44.6% 498.7 27.1%
100.0% 1,842.5 100.0% | -5.8% -7.0% 2.5% 1.8% -3.8% | -1.8% 0.7% -4.7%
|
Region breakdown by key market
Americas by market
FY 2020 €m % FY 2019 €m % | Change % | of which: organic perimeterforex |
USA Jamaica Canada Brazil 506.8 28.6%
| 2.4% -15.8% 9.4% -36.5% -26.5% -5.8% | 3.4%
|
Q4 2020 organic
2.5%
-30.2%
-3.0%
2.8% -7.0%
Q4 2020 organic
13.0%
-9.3%
15.8%
-22.7%
-14.9% 2.5%
Net sales by region & key market
Southern Europe, Middle East & Africa by market
FY 2020 €m % FY 2019 €m % | Change % | of which: organic perimeterforex |
Italy France GTR 303.8 102.5 Other countries Southern Europe, Middle East & Africa 8.8 48.4 463.6 17.1% 5.8% 0.5% 2.7% 26.2%
| -17.2% 154.7% -70.7% -21.0% -7.0% | -17.4% 38.4% -68.9% -38.7% -18.6%
|
North, Central & Eastern Europe by market
FY 2020 €m % FY 2019 €m % | Change % | of which: organic perimeterforex |
Germany Russia United Kingdom Other countries 182.8 50.7 49.0 North, Central & Eastern Europe 121.2 403.7 10.3% 2.9% 2.8% 6.8% 22.8%
| 5.9% -9.3% 5.9% 1.9% 2.5% | 8.6% 10.7% 7.4% 2.1% 6.8%
|
Asia Pacific by market
FY 2020 €m % FY 2019 €m % | Change % | of which: organic perimeterforex |
Australia Other countries Asia Pacific 103.4 27.5 130.8 5.8% 1.5% 7.4%
| 17.0% -31.7% 1.8% | 20.2% -29.7% 4.6%
|
Q4 2020 organic
-32.6%
9.6%
-78.9%
-34.1% -30.2%
Q4 2020 organic
1.1%
2.2%
-20.4%
-4.6% -3.0%
Q4 2020 organic 18.7% -32.9% 2.8%
Net sales by brand cluster
Consolidated Net sales by brand cluster
FY 2020 € m % FY 2019 € m % | Change % | of which: organic perimeterforex |
Global Priorities Regional Priorities Local Priorities Rest of portfolio Total 985.4 319.1 195.7 271.9 1,772.0 55.6% 18.0% 11.0% 15.3% 100.0%
| -6.0% 3.2% -7.5% -0.5% -3.8% | -3.8% 0.4% -4.4% -10.0% -4.1%
|
Q4 2020 organic
-7.1%
3.3%
-14.0%
-15.5% -7.0%
FY 2020 Consolidated P&L
FY 2020 FY 2019 Reported change € million % of sales € million % of sales %Organic margin accretion/ (dilution) (bps) (3)Organic changeForex impactPerimeter effect % % % | ||
Net Sales COGS (1) Gross Profit A&P Contribution after A&P SG&A (2) 716.1 40.4% 801.3 | 1772.0 (746.1)1025.9 (309.8) (394.2) -17.5% -22.2%
| 100.0% -42.1% 57.9% 1842.5 (721.3) 1121.2 100.0% -39.1% 60.9% -3.8%3.4%-8.5% -3.1% -10.6% 0.2% -280 -30 -320 -60 -4.1% 2.9% -8.5% -2.2% -11.0% -1.4% -2.7% 3.0% -5.0% 5.5% -1.3% 1.3% -2.3% 1.3% -0.9% 1.3% -3.2% 4.8% |
EBIT adjusted 321.9 18.2% 408.0 22.1% -21.1% -380 -20.4% 1.4% -2.1% | ||
Operating adjustments Operating profit (EBIT) (90.1) 231.8 -5.1% 13.1% (21.7) 386.3 -1.2% 21.0% - -40.0% | ||
Net financial income (charges) Adjustments to financial income (charges) (38.9) Profit (loss) related to associates and joint ventures 1.4 (2.8) Put option, earn out income (charges) and hyperinflation effects 18.1 -2.2% 0.1% -0.2% 1.0% (33.0) 5.8 0.1 (4.7) -1.8% 0.3% 0.0% -0.3% 17.9%--- Profit before tax and non-controlling interests Profit before tax and non-controlling interests adjusted 209.6 278.9 11.8% 15.7% 354.6 370.4 19.2% -40.9% 20.1% -24.7% | ||
Taxation (22.7) Net profit for the period 186.9 -1.3% 10.5% (46.2) 308.4 Net profit for the period adjusted 201.1 | 11.3% 267.4 -2.5% 16.7% 14.5% | -50.8%-39.4%-24.8% |
Non-controlling interests Group net profit 187.9 10.6% 308.4 Group net profit adjusted 202.1 | (1.0) -0.1% (0.0) 11.4% 267.4 0.0% 16.7% 14.5% | - -39.1%-24.4% |
Depreciation & Amortisation (78.0) EBITDA adjusted 399.9 -4.4% 22.6% (71.8) 479.8 EBITDA 309.8 | 17.5% 458.1 -3.9% 26.0% 24.9% | 8.6% -16.7% -32.4% -40 -330 6.8% -16.3% -3.8% 0.6% 5.7% -0.9% |
Perimeter
(1) COGS = cost of materials, production and logistics expenses
(2) SG&A = selling, general and administrative expenses
(3) Bps rounded to the nearest ten
Q4 2020 Consolidated income statement
Q4 2020
€ millionQ4 2019
% of sales € million % of salesReported change
Organic change
%Forex impact Perimeter effect
%
%
%Net Sales COGS (1)
Gross Profit A&P
Contribution after A&P SG&A (2)
EBIT adjusted Operating adjustments Operating profit (EBIT)
(225.2) 264.4
(94.4) 170.0
(96.6) 73.4
489.6
100.0% -46.0% 54.0% -19.3% 34.7% -19.7% 15.0% -8.5% 6.4%
(226.1) 312.6
(105.0) 120.0
(87.6) 225.0
538.7
100.0% -42.0% 58.0% -16.3% 41.8% -19.5% 22.3% -1.4% 20.8%
-9.1%-0.4%-15.4%7.8%-24.4%-8.0%-38.8%
-7.0% 0.1% -12.1% 10.5% -20.9% -7.1% -33.0%
-5.7% 3.6%
-6.9% 6.4%
-4.8% 1.5%
-5.3% 2.5%
-4.6% 1.1%
-6.3% 5.5%
-3.2% -2.6%
(41.8) 31.5
(7.8) 112.2
--71.9%
Net financial income (charges) Financial adjustments
Profit (loss) related to associates and joint ventures
Put option, earn out income (charges) and hyperinflation effects Profit before tax and non-controlling interests
(11.5)
(0.6) (1.9) 2.7 20.2
-2.3% -0.1% -0.4% 0.6% 4.1%
(7.6) 5.8 (0.0) (1.0) 109.5
-1.4% 1.1% 0.0% -0.2%
51.4%---
20.3% -81.5%
Depreciation & Amortisation
EBITDA adjusted EBITDA
(19.4) 92.7 50.9
-4.0% 18.9%
(19.5) -3.6% 139.5 25.9%
-0.9% | 6.5% | -6.5% | -0.8% |
-33.5% | -27.5% | -3.6% | -2.4% |
10.4% 131.7 24.5% -61.4%
(1) COGS = cost of materials, production and logistics expenses
(2) SG&A = selling, general and administrative expenses
FY 2020 EPS adjusted: basic and diluted
FY 2020 | FY 2019 | ||
€ million | 202.1 | 267.4 | |
Weighted average of ordinary share outstanding | number | 1,133,816,568 | 1,144,315,926 |
Basic earnings per share adjusted | € | 0.18 | 0.23 |
Group net profit adjusted net of dilution | € million | 202.1 | 267.4 |
Weighted average of ordinary share outstanding | number | 1,133,816,568 | 1,144,315,926 |
Weighted average of shares from the potential exercise of stock options with dilutive effect | number | 22,437,158 | 25,539,096 |
Weighted average of ordinary shares outstanding net of dilution | number | 1,156,253,726 | 1,169,855,022 |
Diluted earnings per share adjusted | € | 0.17 | 0.23 |
Group net profit adjusted
Reclassified balance sheet
Invested capital and resources
€ million
Inventories (including biological assets) Trade receivables
Trade payables
Operating working capital Tax credits
Other receivables and current assets Assets held for sale
Other current assets Payables for taxes Other current liabilities Liabilities held for sale Other current liabilities Defined benefit obligations Deferred tax liabilities Deferred tax assets Other non-current assets Other non-current liabilities
Other net non-current assets / liabilities Net tangible fixed assets
Intangible assets, including goodwill & trademarks Equity investments
Total fixed assets Invested capital
Group net equity Minorities interest Net debt Financing sources % Net debt on equity
31 December 2020 | 31 December 2019 | Change |
656.8 | 616.7 | 40.1 |
281.8 | 316.8 | (35.0) |
(321.2) | (241.2) | (80.0) |
617.4 | 692.3 | (74.9) |
17.4 | 18.7 | (1.3) |
45.0 | 44.7 | 0.2 |
3.3 | 5.3 | (1.9) |
65.7 | 68.7 | (3.0) |
(16.1) | (75.1) | 58.9 |
(140.3) | (140.9) | 0.6 |
- | - | - |
(156.4) | (215.9) | 59.6 |
(33.4) | (33.4) | (0.0) |
(337.0) | (386.1) | 49.0 |
44.5 | 38.3 | 6.2 |
5.7 | 8.2 | (2.4) |
(49.0) | (68.6) | 19.6 |
(369.2) | (441.6) | 72.5 |
562.7 | 593.7 | (31.0) |
2,355.8 | 2,468.2 | (112.4) |
26.1 | 0.5 | 25.6 |
2,944.6 | 3,062.4 | (117.8) |
3,102.2 | 3,165.9 | (63.7) |
(389.9) | ||
(0.2) | ||
326.4 | ||
(63.7) |
1,996.6
2,386.6
1.8 1.9
1,103.8 777.4
3,102.2
3,165.9
55.3%
32.6%
Consolidated balance sheet (1 of 2)
Assets
31 December 2020 | 31 December 2019 | Change | |
€ million | |||
ASSETS | |||
Non-current assets | |||
Property, plant and equipment | 485.7 | 508.3 | (22.5) |
Right of use assets | 71.5 | 80.5 | (9.0) |
Biological assets | 5.5 | 3.9 | 1.6 |
Investment properties | (0.0) | 1.1 | (1.1) |
Goodwill | 1,356.6 | 1,387.8 | (31.2) |
Brands | 954.5 | 1,035.6 | (81.1) |
Intangible assets with a finite life | 44.7 | 44.8 | (0.1) |
Investments in associates and joint ventures | 26.1 | 0.5 | 25.6 |
Deferred tax assets | 44.5 | 38.3 | 6.2 |
Other non-current assets | 5.7 | 8.2 | (2.4) |
Other non-current financial assets | 7.1 | 14.7 | (7.6) |
Total non-current assets | 3,001.9 | 3,123.5 | (121.6) |
Current assets | |||
Inventories | 655.1 | 615.9 | 39.3 |
Biological assets | 1.6 | 0.9 | 0.8 |
Trade receivables | 281.8 | 316.8 | (35.0) |
Other current financial assets | 1.2 | 8.3 | (7.1) |
Cash and cash equivalents | 548.1 | 704.4 | (156.4) |
Income tax receivables | 17.4 | 18.7 | (1.3) |
Other current assets | 45.0 | 44.7 | 0.2 |
Assets held for sale | 3.3 | 5.3 | (1.9) |
Total current assets | 1,553.6 | 1,714.9 | (161.3) |
Total assets | 4,555.5 | 4,838.5 | (282.9) |
€ million
€ million
Consolidated balance sheet (2 of 2)
Liabilities and shareholders' equity
31 December 2020 | 31 December 2019 | Change | |
€ million | |||
LIABILITIES AND SHAREHOLDERS' EQUITY | |||
Shareholders' equity | |||
Issued capital and reserves attributable to owners of the parent | 1,996.6 | 2,386.6 | (389.9) |
Non-controlling interests | 1.8 | 1.9 | (0.2) |
Total shareholders' equity | 1,998.4 | 2,388.5 | (390.1) |
Non-current liabilities | |||
Bonds | 894.7 | 349.4 | 545.3 |
Loans due to banks | 320.0 | 249.3 | 70.7 |
Other non-current financial liabilities | 169.3 | 210.9 | (41.6) |
Post-employment benefit obligations | 33.4 | 33.4 | 0.0 |
Provisions for risks and charges | 41.6 | 52.4 | (10.7) |
Deferred tax liabilities | 337.0 | 386.1 | (49.0) |
Other non-current liabilities | 7.3 | 16.2 | (8.9) |
Total non-current liabilities | 1,803.4 | 1,297.6 | 505.8 |
Current liabilities | |||
Bonds | - | 580.0 | (580.0) |
Loans due to banks | 244.3 | 31.0 | 213.3 |
Other current financial liabilities | 31.9 | 84.3 | (52.4) |
Trade payables | 321.2 | 241.1 | 80.1 |
Income tax payables | 16.1 | 75.1 | (58.9) |
Other current liabilities | 140.3 | 141.0 | (0.7) |
Total current liabilities | 753.7 | 1,152.4 | (398.6) |
Total liabilities | 2,557.2 | 2,450.0 | 107.2 |
Total liabilities and shareholders' equity | 4,555.5 | 4,838.5 | (282.9) |
€ million
€ million
Reclassified cash flow statement
Change | |||
€ million | |||
EBITDA | 309.8 | 458.1 | (148.3) |
Goodwill, trademark and sold business impairment | 45.7 | - | 45.7 |
Effects due to IAS 29 application | 2.4 | 4.5 | (2.1) |
Provisions and other changes from operating activities | (9.3) | (24.8) | 15.4 |
Income taxes paid | (119.7) | (45.3) | (74.4) |
Cash flow from operating activities before changes in working capital | 228.8 | 392.5 | (163.7) |
Changes in net operating working capital | 43.4 | (29.6) | 73.0 |
Cash flow from operating activities | 272.2 | 363.0 | (90.7) |
Net interests paid | (25.3) | (27.9) | 2.7 |
Adjustments to financial income (charges) | 1.4 | 5.8 | (4.4) |
Capital expenditure | (79.8) | (82.4) | 2.7 |
Free cash flow | 168.6 | 258.5 | (89.8) |
(Acquisition) disposal of companies or business division | (120.6) | 110.8 | (231.4) |
Dividend paid out by the Parent Company | (62.9) | (57.3) | (5.6) |
Other changes (incl. net puchase of own shares) | (275.6) | (54.3) | (221.3) |
Total cash flow used in other activities | (459.1) | (0.8) | (458.3) |
Exchange rate differences and other changes | (22.6) | (13.9) | (8.6) |
Change in net financial position due to operating activities | (313.1) | 243.7 | (556.8) |
Put option and earn-out liability changes | (5.6) | (77.6) | 72.0 |
Effect of IFRS 16-'Leases' first application | - | (81.4) | 81.4 |
Increase in investments for lease right of use | (7.8) | (15.8) | 8.0 |
Net cash flow of the period = change in net financial position | (326.4) | 68.9 | (395.3) |
Net financial position at the beginning of the period | (777.4) | (846.3) | 69.0 |
Net financial position at the end of the period | (1,103.8) | (777.4) | (326.4) |
31 December 2020 31 December 2019 € million € million
Cash flow statement (1 of 2)
31 December 2020 | 31 December 2019 | Change | |
231.8 | 386.3 | (154.5) | |
Effects from hyperinflation accounting standard adoption | 2.4 | 4.5 | (2.1) |
Depreciation and amortisation | 78.0 | 71.8 | 6.2 |
Gains and losses on sales of fixed assets | 0.6 | (2.5) | 3.1 |
Impairment of tangible fixed assets, goodwill, trademark and sold business | 45.6 | 6.6 | 39.0 |
Use of provisions | (1.5) | (15.7) | 14.2 |
Change in payables to employees | (8.6) | (10.0) | 1.4 |
Change in net operating working capital | 43.4 | (29.6) | 73.0 |
Income taxes refund (paid) | (119.7) | (45.3) | (74.4) |
Other non-cash items | 0.1 | (3.2) | 3.3 |
Cash flow generated from (used in) operating activities | 272.2 | 363.0 | (90.7) |
Purchase of tangible and intangible fixed assets | (84.7) | (92.0) | 7.3 |
Disposal of tangible and intangible assets | 4.9 | 9.6 | (4.7) |
Acquisition of companies or business divisions | (95.4) | (86.5) | (9.0) |
Cash and cash equivalents at acquired companies | 3.3 | 6.0 | (2.7) |
Proceeds from sale of investment property | - | 200.0 | (200.0) |
Put options and earn-out payments | (85.1) | (69.2) | (15.9) |
Interests received | 6.2 | 9.0 | (2.7) |
Decrease (increase) in short-term deposits and investments | (0.0) | 27.4 | (27.4) |
Other changes | (1.8) | (0.1) | (1.7) |
Cash flow generated from (used in) investing activities | (252.4) | 4.3 | (256.7) |
€ million
Operating profit
Cash flow statement (2 of 2)
31 December 2020 | 31 December 2019 | Change | |
Proceeds from issue of bonds, notes and debentures | 545.0 | 149.3 | 395.7 |
Repayments of bonds, notes and debentures | (580.9) | (219.1) | (361.9) |
Proceeds from non-current borrowings | 195.1 | 248.7 | (53.7) |
Repayment of non-current borrowings | (13.2) | (300.0) | 286.8 |
Net change in short-term financial payables and bank loans | 80.7 | 19.8 | 60.9 |
Payment of lease liabilites | (14.6) | (13.0) | (1.5) |
Interest on leases | (3.2) | (3.4) | 0.1 |
Interests paid | (26.8) | (27.7) | 0.8 |
Other inflows (outflows) of cash | 12.3 | (23.2) | 35.5 |
Purchase and sale of own shares | (271.2) | (47.3) | (223.9) |
Dividend paid by the equity holders of the Parent | (62.9) | (57.3) | (5.6) |
Cash flow generated from (used in) financing activities | (139.7) | (273.2) | 133.4 |
Other differences including exchange rate differences | (36.4) | (3.6) | (32.9) |
Net change in cash and cash equivalents: increase (decrease) | (156.4) | 90.5 | (246.8) |
Cash and cash equivalents at the beginning of period | 704.4 | 613.9 | 90.5 |
Cash and cash equivalents at end of period | 548.1 | 704.4 | (156.4) |
€ million
Financial debt details
Eurobonds and Term loan composition as of 31 December 2020
OutstandingIssue date
Maturity
TypeCurrencyCoupon
Amount (€ million)Original tenorAs % of total
Apr 5, 2017
Apr 5, 2017
Apr 30, 2019
Apr-22
Jul 31, 2019
Oct 6, 2020
Oct-27
Apr-24
Apr-24
Jul-24
Unrated Eurobond Unrated Eurobond Unrated Eurobond Term Loan Unrated Eurobond
EUR EUR EUR EUR EUR
1.768%
2.165%
1.655%
1.25% +3m euribor (1)
50 5 years 4%
150 7 years 13%
150 5 years 13%
250 5 years 22%
1.250%
550 7 years 48%
Total gross debt
1,150
100%
Average cost of gross debt(1) Floor rate of 0% for Euribor
1.42%
Net financial debt composition as of 31 December 2019
€ million
31 December 2020
31 December 2019
Δ 31 December 2020 vs.
31 December 2019
Short-term cash/(debt) (A)
- Cash and cash equivalents
- Bonds
- Bank loans
- Lease
- Others financial assets and liabilities
Medium to long-term cash/(debt) (B)
- Bonds
- Bank loans
- Lease
- Others financial assets and liabilities
Debt relating to operating activities (A+B)
Liabilities for put option and earn-out payments (1)
Net cash/(debt)
276.6 548.1
71.5 205.2
704.4 (156.4)
0.0 (244.3)
(580.0) 580.0
(31.0) (213.3)
(13.9) (13.3)
(13.1) (0.8)
(8.9) (4.4)
(1,277.1)
(666.1) (611.0)
(894.7) (320.0) (69.5)
(349.4) (545.3)
(249.3) (70.7)
(77.3) 7.8
7.1
9.8 (2.8)
(1,000.5)
(594.6) (405.8)
(103.3)
(182.8) 79.5
(1,103.8)
(777.4)
(326.4)(2)
(1) Including commitments for future minority purchases (including Grand Marnier) and payable for future earn-outs
(2) Of which €(159.7) million attributable to effects of acquisitions and forex
Operating working capital
Trade receivables
Total inventories, of which:
- maturing inventory
- biological assets
- other inventory
Trade payables
Operating working capital
Reported | Forex | ||||||
change | impact | ||||||
€ million | % sales | € million | % sales | €million | |||
281.8 | 15.9% | 316.8 | 17.2% | (35.0) | (42.0) | 38.8 | (31.8) |
656.8 | 37.1% | 616.7 | 33.5% | 40.1 | 47.7 | 35.6 | (43.3) |
368.1 | 20.8% | 374.4 | 20.3% | (6.3) | 20.1 | - | (26.3) |
1.6 | 0.1% | 0.9 | 0.0% | 0.8 | 0.9 | - | (0.1) |
287.0 | 16.2% | 241.5 | 13.1% | 45.6 | 26.8 | 35.6 | (16.8) |
(321.2) | -18.1% | (241.2) | -13.1% | (80.0) | (49.2) | (44.6) | 13.7 |
617.4 | 34.8% | 692.3 | 37.6% | (74.9) | (43.4) | 29.8 | (61.4) |
Organic change
31 December 2020
31 December 2019
Perimeter effect
Exchange rates effects
Average exchange rate
Period end exchange rate
FY 2020 : 1 Euro
FY 2019 change FY 2020 vs FY 2019
: 1 Euro
%
31 December 2020 : 1 Euro
31 December 2019 : 1 Euro
change 31 December 2020
vs 31 December 2019
%
US Dollar Canadian Dollar Jamaican Dollar Mexican Peso Brazilian Real Argentine Peso(1) Russian Ruble Great Britain Pounds Switzerland Francs Australian Dollar Chinese Yuan
1.141 1.120
1.530 1.486
162.606 149.201
24.514 21.558
5.890 4.413
103.249 67.275
82.654 72.459
0.889 0.877
1.070 1.113
1.655 1.611
7.871 7.734
-1.9%
1.227 1.123
-2.9%
1.563 1.460
-8.2%
174.805 148.887
-12.1%
24.416 21.220
-25.1%
6.374 4.516
-34.8%
103.249 67.275
-12.3%
91.467 69.956
-1.3%
0.899 0.851
4.0%
1.080 1.085
-2.7%
1.590 1.600
-1.7%
8.023 7.821
-8.5%
-6.6%
-14.8%
-13.1%
-29.1%
-34.8%
-23.5%
-5.4%
0.5%
0.6%
-2.5%
(1)Following the adoption of IAS 29 'Financial reporting Hyperinflationary economies' in Argentina, the average exchange rate of Argentine Peso for FY 2020 was adjusted to be equal to the rate as of 31 December 2020
Disclaimer
This document contains forward-looking statements that relate to future events and future operating, economic and financial results of Campari Group. By their nature, forward-looking statements involve risk and uncertainty because they depend on the occurrence of future events and circumstances. Actual results may differ materially from those reflected in forward-looking statements due to a variety of factors, most of which are outside of the Group's control.
It should be noted that the company's accounts and consolidated results, as well as the data related to Sustainability, are subject to auditing.
CONTACTSinvestor.relations@campari.com
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Davide Campari - Milano NV published this content on 18 February 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 18 February 2021 12:26:07 UTC.
