Download - GUINNESS F13 Full Year Briefing
Seni Adetu, Managing Director /CEO
Lisa Nichols, Finance/Strategy Director
Sesan Sobowale, Corporate Relations Director
AGENDA
ITEM PRESENTER SLIDE
Introduction Seni Adetu -
Company Overview Seni Adetu 4
Market and Performance Overview Seni Adetu 8
Financial Performance Lisa Nichols 11
Highlights of the year Seni Adetu 16
Strategic priorities Seni Adetu 24
Conclusions Seni Adetu 26
Q&A Sesan Sobowale 28
COMPANY OVERVIEW
OUR COMPANY
Strong portfolio diversity including alcoholic and non-alcoholic beverages covering a wide
range of consumer segments and choices
Strong values: Performance culture, developing talent, positively impacting the
communities in which we operate, strong governance and ethical standards
Commitment to significant investment to deliver long-term growth
• Major investments in capacity expansion
• Almost doubled sales in 4years
• Largest Guinness market in the world in net sales
Guinness Nigeria is a part of Diageo – the world’s foremost premium alcoholic drinks
company. We have been in Nigeria since 1962 with a strong pedigree operating from four
sites - 2 in Lagos (Ogba & Ikeja), Benin and Aba.
OUR BRANDS
We have a diverse portfolio of brands that are adored by Nigerian consumers. These include:
STOUT RTD NON-ALCOHOLIC LAGER
- Guinness Foreign Extra Stout
- Guinness Extra Smooth
- Harp Lager
- Dubic Lager
- Satzenbrau
- Smirnoff Ice
- Snapp
- Malta Guinness
- Malta Guinness Low Sugar
- Top Malt
OUR AMBITION
Guinness Nigeria Plc is the best performing, most trusted and respected consumer products company in
Nigeria
Employer of Choice Superior Total Shareholder
Returns
Most reputable in the Community
7
MARKET & PERFORMANCE OVERVIEW
Opportunities:
• Rapid growth of emerging middle class: (20m living
on $2-4per day)
• Positive economic fundamentals in the medium
term
• Election in 2015 likely to encourage spending
• Power sector privatisation to improve energy
supply
Economic indicators:
• GDP has been growing and averaging 6% - 8% in
past two years
• Nigeria to remain in top quartile of GDP growth from
2011-2016
• Inflation Rate averaging 10% Y.O.Y
Challenges:
• Pressured Consumer Discretionary Income leading to
re-prioritization
• Declining government revenue due to lower output
• Security challenges especially in the Northern parts of
the country
Source: Euromonitor International – world Economic outlook ; Nigeria Bureau of Statistics
KEY DRIVERS OF PERFORMANCE
Market softness:
De-prioritization of beer by consumers, declining discretionary income , down trading leading to faster
growth of value brands, government spending behind plan, Malt market declining at a lower rate
RtC competitiveness :
Invested in additional sales force to improve outlet coverage, GDCs deployed to over 200 areas in
Nigeria
Investment in capacity :
Flexibility in meeting changing consumer trends, channel is still logistically expensive to service,
Increased interest cost
Representation in large/growing segments:
Innovation of value brands, RTD’s exploitation , Low sugar malt innovation
Performance Overview: Growth %
Net Revenue 5%
Operating Profit – 6%
Profit After Tax -17%
FINANCIAL PERFORMANCE
GN PLC F13 RESULTS – COMPREHENSIVE INCOME
Q4 F13 Growth FY F13 Growth
Nbillion % Nbillion %
Gross Revenue 36.5 7% 131.4 4%
Net Revenue 34.0 8% 122.5 5%
Cost of Sales (18.2) 13% (66.4) 8%
Gross Profit 15.8 3% 56.1 2%
Marketing & Distr. (6.6) 18% (26.0) 6%
Admin Costs (2.9) 28% (10.3) 9%
GN PLC F13 RESULTS – COMPREHENSIVE INCOME
Q4 F13 Growth FY F13 Growth
Nbillion % Nbillion %
Operating Profit 6.8 -9% 20.6 -6%
Financing charges (1.1) 52% (3.6) 138%
PBT 5.8 -15% 17.0 -17%
Tax (1.3) -21% (5.1) -17%
PAT 4.5 -13% 11.9 -17%
K K
EPS 299 -14% 793 -18%
DRIVERS OF PROFIT BEFORE TAX
1
4
17.0
0.1
6.9
20.4
Admin
costs
Price Mktg &
distr.
-1.4
Volume
-0.9
-0.8
-5.1
2012
PBT
CoGS 2013
PBT
-2.1
Financing Other
income
Drivers of PBT decline F13 vs. LY (Nbillion)
Capacity expansion
depreciation
Expansion
investment
GN PLC F13 RESULTS - FINANCIAL POSITION
FY F13 FY F12 Movt
Nbillion Nbillion Nbillion
Non-Current Assets 88.8 77.2 11.6
Inventories 12.4 13.2 (0.8)
Receivables 16.6 10.8 5.8
Cash 3.2 4.8 (1.6)
Total Assets 121.1 106.0 15.1
Current Liabilities (51.3) (45.2) (6.1)
Non-Current Liabilities (23.7) (22.2) (1.5)
Equity (46.0) (38.6) (7.4)
Net Equity & Liabilities (121.1) (106.0) (15.1)
HIGHLIGHTS OF F13
HIGHLIGHTS OF F13
Brands Innovation Route to
Consumer Supply Reputation People
HIGHLIGHTS - BRANDS
Guinness Harp & Dubic Malta Guinness Smirnoff Ice
EPL broadcast Sponsorship
Fly With The Eagles Campaign
AFCON Campaign and
Jersey Tour
Made of More campaign
Partnership with football
Improved media and OOH visibility
Harp rhythm unplugged
‘Smirnoff Midnight Circus’
events
Distribution drives
Promoting healthier living
Competitive pricing
Distribution drive and
consumer experience
18
H1
Malta Guinness Low Sugar Launched nationally in May F12
F13 saw weighted distribution grow by
double digits
Snapp Launched in Lagos and 4 other cities – Abuja,
Benin, Port Harcourt and Calabar
Snapp sleek cans launched in Dec 2012
H2
Snapp Rolled out nationally
Refreshed advertising
Dubic • New green bottle
• Regional expansion
Top Malt • Pack redesign for
national re-launch
19
HIGHLIGHTS - INNOVATION
Cold & Events GDC Branding
Investments in project cold
Special events supporting
social events driving
convenience & visibility
Guinness Distribution Centres
(GDC) driving rural re-
distribution
Roll out progressing well
Distributor warehouse
branding
• Flagship outlet branding
Sales coverage
Additional sales vans
Maximised opportunity in Key
Account.
Increased visibility via Kitting of
Bar men
20
HIGHLIGHTS - ROUTE TO CONSUMER
HIGHLIGHTS - SUPPLY
21
Gas / Diesel Generator
and Boilers
CO₂ Plant and
Loading capacity
Quality & Safety
Harp Lager Beer & Malta Guinness
won the 2012 Monde Gold Quality
Award
Zero LTA – award by Nigerian
Employers Consultative Association
(NECA) and the Nigerian Social
Insurance Trust Fund (NSITF).
Responsible Drinking & Community Investments
•Project DIY: skills training
for children's in the
orphanages.
•The Social Enterprise
Report Awards (SERA) for
‘Best Company in Labour
Practice’
•World AIDS campaign
•Motor Park Health and Safety
Programme with Lagos State
•Won ‘Best Private Sector
Company Supporting Water
Sector (Min of Water Res)
•WOL in Ago Ibami and Oza Nogogo
•Relief materials to flood victims in Edo
State.
•Technical education scholarships to
students
OUR WORK IN THE COMMUNITY
23
Dedicated engagement resources working with teams to resolve issues
Significant progress in employee engagement with improved communications and increased leadership team engagements
Development / career plans and moves are also key to engagement
Capability
Talent Development
Employee Engagement
•We have secured more local leaders externally to strengthen our leadership pipeline
•We have made internal movements and promotions to fill vacancies created to support our growth ambitions
Gender diversity of leadership population improving
Introduction of an in-house sales academy to upscale our sales capability
Vibrant employee awards scheme
HIGHLIGHTS – PEOPLE
Afeez Ajibowu Eyitemi Taire
Kingsley
Imade Chizoba Ojielo
Innocent
Nwaononiwu
Patrick Awotwi
STRATEGIC PRIORITIES
Strengthen and accelerate our premium core brands
Innovate at scale to meet new consumer needs
Build and then constantly extend our advantage in Route to Consumer (RtC)
Drive out cost to invest in growth
Guarantee our plans with the right people and capability
CONCLUSION
2
5
• In F13 we delivered a 5% growth in revenue in a challenging market with constrained consumer
discretionary income, security concerns, highly competitive RtC and increased competition
• The industry has experienced a decline in the last c.2years but is expected to rebound in the near
to medium term in line with the positive economic fundamentals
• We have enhanced our ability to compete favorably against competition with our increased
capacity, continued development of RtC channel, accelerated investment behind our brands and a
great talent pool
• Reasons to believe
o Quality of our innovation
o A blend of experts and local senior managers
o Enhancement of our RtC competitiveness
o Our partnership with Diageo gives us access to expertise in delivering our future ambition