corporate presentation - arca continental · corporate presentation 2015. presentation disclaimer...
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Corporate Presentation2015
Presentation Disclaimer
During this presentation management may discuss certain forward-looking statements concerning Arca Continental’s future performance that should be considered as good-faith estimates made by the Companies.
These forward-looking statements reflect management expectations and are based upon currently available data. Actual results are subject to future events and uncertainties, which could materially impact Arca Continental’s actual performance.
One of the most profitable companies in the Industry
• +20% EBITDA margin
• Sustainable Dividend Pay Out Ratio + 50% Last 4 years
• Net Debt to EBITDA of 1.7x
3
Revenues by Business Unit
13%
7%
12%
52%
2015*
16%
A geographic balanced business portfolio
*Pro forma Sales 2015 (MXP):
$82,442 4
Coca Cola as a solid partner in our business structure
Arca Continental Control Group
71%Float BMV: AC*
20%The Coca-Cola Company
9%
Best in class Corporate Governance
• Balanced Board of Directors (20 members, 5 independent)
• Majority shareholders only at Board level
• The Coca-Cola Company appoints one member of the Board
• Audit Committee comprised of independent members only
• No transactions with related parties
Successful brand portfolio to satisfy every consumption occasion
Brands SKUs+40 +6007
Investments focused on incremental volume initiatives
• Coolers
• Glass & Ref-Pet bottles
• IT
• New Facilities
2015CAPEXMxp$5,200
Million
14%
21%
1%
56%
2%
6%
Mexico Ecuador ArgentinaInalecsa USBokados
Solid inorganic growth
2002
2007
2008
2010
2011
2012
2013
2014
Arca Merger
SnacksMexico and
Vending
ToniCorp
Nogales
Snacks Intl.& Santa
ClaraContal Merger
Argentina &Jugos del
Valle
Ecuador
2002 – 2014 M&A
9
2015
The power of knowledge
• Consumer & Customer Insights
• Segmentation
• Price & Package Architecture
• Shopper solutions
• RGM
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Mexico
• Start date: 1926
• Sales volume (MUC) 1,000
• % KO volume 30
• Population served (MM) 30
• Start date: 2010
• Sales volume (MUC) 149
• % of KO volume 100%
• Population Served (MM) 15
• Start date: 2008
• Sales volume (MUC) 141
• % of KO volume 21%
• Population Served (MM) 9
Argentina Ecuador
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• Start date: 2015
• Sales volume (MUC) 281
• % of KO volume 100%
• Population served (MM) 31
Arca Continental Territories
Mexico´s opportunity is to develop stillbeverages portfolio
62% Non
Returnable
38% Returnable
10% On Premise2%
Vending
60% Traditional
14%C-Stores
7%Other
7%S-Markets 11%
Flavors
6% Stills
62% Colas
17%Jug
4%Water
48% Single-serve
52% Multi-serve
12
Channel Category
Format
Package
Promoting the consolidation of the KO System in Latin America
• Acquired 25% minority stake in Bebidas Refrescantes de Nogales in northern Mexico
• Proximity of our territories allows further opportunities for synergies and find better ways to serve
CDF
Nayar
Colima
RicaBepensa
AC
KOF
Nogales
AC
KOF
Rica
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Argentina focusing on developstill beverages, single serve & cooler coverage
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58% Non
Returnable
42% Returnable
2% On Premise
46% Traditional
1%C-Stores
31%Other
20%S-Markets
26% Flavors
1%Stills
65% Colas
8%Water
8%Single-serve
92% Multi-serve
Channel Category
Format
Package
Ecuador developing cooler coverage & returnable single serve
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80% Non
Returnable
20% Returnable
13% On Premise
65% Traditional
1%C-Stores
14%Other
7%S-Markets
30% Flavors
11%Stills
49% Colas
10%Water
29% Single-serve
71% Multi-serve
Channel Category
Format
Package
Strong single-serve mix and returnable base
69% Non-
Returnable
31% Returnable
8% On Premise
58% Traditional
9%C-Stores
10%Other
4%S-Markets
6% Stills
74% CSDs
4%Jug
16%Water
40% Single-serve
60% Multi-serve
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Channel Category
Format Package
2%Wholesalers
2015
We have delivered outstanding resultsin South America
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• Consistently creating value in Argentina, EBITDA when acquired:
Usd$95 million in 2010 to Usd$185 million in 2014
• 11 percentage points market share gain in Argentina
• Increasing execution and cooler coverage.
Argentina 45%, +20 p.p. Ecuador 47%, +26 p.p.
• All CAPEX investments made from cash generated from operations
Strong brand portfolio
(2007) (2013) (2013)
• 3rd largest snack brand in Mexico, 40 year history
• Sales tripled in six years
• Plan to expand nationwide
• One of the largest distribution networks
• 40 year history
• Strong position in the Ecuadorian market
• 2nd largest player at a national level
• Over 90 years history
• Leading regional brand
• #1 brand in NY metro area
• USD$7 billion market size in regions served
High potential growth opportunity bases on strategic adjacencies to our Core
• Complementary to our core business
• Expand snack business in Mexico under Bokados and complements with Wise
• Strengthen our presence in the US and Ecuador
USD$ 350 MM in 2014
(8% of Revenues)
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An aggressive Direct to Home expansion is building loyalty with our consumers
4.1
4.5
DTH SALES(MUC)
2013 2014
226
336
DTH ROUTES
2013 2014
+11%
+49%
• Leverage our Jug water business to sell other categories
• Jug Water currently reach 900,000 households
• Opportunity to introduce new categories and brands
Exports capitalizes a$104 MM USD growing market
+6x vs 2005
2005 2006 2007 2008 2009 2010 2011 2012
2.0 2.94.3 4.4
6.69.0
10.6
3.1
3.94.0
4.54.9
5.2
6.4
6.8
Coca-Cola (Nostalgia)
Exports
6.9
13.0
2013
7.7
13.0
2014
Performing is worthless without respecting our environment
WATER
**2014
1.68 Water Lts. /Beverages Lts.
14% vs 2010Goal of 1.5 Water LTS. / Beverages Lts.
RECYCLING
** 2014
38% of PCR
26,000 Tonsof resin consumed.
ENERGY
**2014
22.4 G CO2 /Beverages Lts.
11,000 MWHSavings in 2014
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Key Takeaways
• Clear Vision and excellence in execution
• Track record in creating shareowner value
• Financial strength and flexibility
• World-class Corporate Governance and professional management team
• Best-in-class production anddistribution capabilities
• Solid M&A and integration capacity, delivering synergies
• Sustainability and Social Responsibility
