ATLANTIC GRUPA Company of Added Value Erste Group Investor Conference, Stegersbach September 2014
ATLANTIC GRUPA
Company of Added Value
Erste Group Investor Conference, Stegersbach September 2014
CONTENT
OVERVIEW OF ATLANTIC GRUPA
FINANCIAL OVERVIEW IN H1 2014
FINANCIAL OVERVIEW IN 2013
STRATEGIC GUIDANCE
2
ONE OF THE LARGEST FOOD AND BEVERAGES COMPANIES IN THE SEE REGION
Key business segments: Key brands:
The leading coffee producer in the region GRAND KAFA, BARCAFFE
Prominent European company in the sports nutrition MULTIPOWER
Among the leading soft drinks producers in the region CEDEVITA, COCKTA, DONAT Mg
Among the leading confectionary & snacks producers in the region SMOKI, NAJLEPŠE ŽELJE, BANANICA
Among the leading savoury spreads producers in the region ARGETA
Producer of the No1 Croatian brand in the VMS segment DIETPHARM
The leading private pharmacy chain in Croatia FARMACIA
The leading FMCG distributer in the SEE region International Brands (Ferrero, Wrigley, Unilever, ...)
Business
Fast Moving Consumer Goods
Headquarters
Zagreb, Croatia (Europe)
Foundation
1991
No of employees
4,228
FY13 sales
EUR 674 millions
Key Markets
SEE region, Western Europe, Russia
presence on over 40 markets
Production locations
14 production locations in Croatia, Slovenia, Bosnia and
Herzegovina, Serbia, Macedonia and Germany
The region includes: Croatia, Slovenia, Bosnia and Herzegovina, Serbia, Montenegro, Macedonia and Kosovo. Reporting currency HRK, all figures in the presentation translated at EUR/HRK FX rate of 7.5.
3
4
DEVELOPMENT CYCLE: EXTENSIVE M&A TRACK RECORD
Acquisition of Kalničke vode Bionatura
Acquisition of DROGA KOLINSKA
Acquisition of pharmacies – Farmacia
IPO
Acquisition of Fidifarm & Multivita
Representative office Moscow
Acquisition of Haleko & Power Gym:
MULTIPOWER
2010
2010
2008/9
2007
2007
2006
2005
Acquisition of Melem
Atlantic Slovenia
Atlantic Macedonia
Acquisition of Neva
Acquisition of CEDEVITA
Atlantic Serbia
Representative office B&H
2004
2004
2003
2003
2001
2001
2001
Cooperation Johnson & Johnson
Cooperation Duracell
Distribution center Rijeka
Distribution center Osijek
Distribution center Split
Cooperation Wrigley
1999
1996
1994
1994
1992
1991
DIS
TR
IBU
TIO
N
DIS
TR
IBU
TIO
N &
PR
OD
UC
TIO
N
VE
RT
ICA
L I
NT
EG
RA
TIO
N
European company
National company
Regional company
2010*: Pro-forma consolidated with Droga Kolinska.
1 6 12 17 27 33 36 42 61 81 90 102145
186223
267 293 302
602630
657 674
0
100
200
300
400
500
600
700
1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2010* 2011 2012 2013
Sales in EURm
CAGR 1993-2013:
+38.0%
ATLANTIC GRUPA’S BUSINESS MODEL TODAY
SBU
COFFEE
From 2014 the company's business operations are organized in six Strategic Business Units (SBU), one Business Unit (BU), five
Strategic Distribution Units (SDU) and two Distribution Units (DU), allowing the company to manage its production and distribution
operations more effectively
SBU
BEVERAGES
SBU
SPORTS AND
FUNCTIONAL
FOOD
SBU
PHARMA
AND
PERSONAL
CARE
SBU
SAVOURY
SPREADS
SBU
SNACKS
SDU
Croatia
SDU
Serbia
SDU
HoReCa
Hotels,
Restaurants,
Cafes
SDU
International
Markets*
5
*International markets: markets outside the region (Croatia, Slovenia, Bosnia and Herzegovina, Serbia, Macedonia and Montenegro), Russia and CIS.
BU
BABY FOOD
SDU
CIS
DU
Slovenia
DU
Macedonia
STABLE MANAGEMENT TEAM AND OWNERSHIP STRUCTURE
Supervisory board
Supervisory Board
Audit CommitteeNomination and Remuneration
Committee
Corporate Governance Committee
Mladen VeberSenior Group Vice President
Business Operations
Zoran StankovićGroup Vice President
Finance
Neven VrankovićGroup Vice President
Corporate Affairs
Emil TedeschiPresident of the
Management Board
Strategic Management Council
Deals with vital strategic and operational corporate issues.
Consists of: Board Members, Vice Presidents and General Managers of each SBU
and SDU, Senior Executive Director for Regional KAM and Sales Croatia, the
Secretary General, Executive Directors of Corporate Controlling, IT, Central
Purchasing and Human Resources, and the Head of the Investment Committee.
6
Management Ownership structure on 30/09/2014
Lada Peter Franz Vedrana
Zdenko Tedeschi Siniša Elam Josef Aleksandar Jelušić
Adrović Fiorio Petrović Håkansson Flosbach Pekeč Kašić
President Vice President Member Member Member Member Member
of the of the of the of the of the of the of the
Supervisory Supervisory Supervisory Supervisory Supervisory Supervisory Supervisory
Board Board Board Board Board Board Board
Emil Tedeschi,
50.2%
Pension funds, 17.9%
EBRD, 8.5%
DEG, 8.5%
Lada Tedeschi
Fiorio, 5.8%
Management1.1%
Others, 8.0%
PRODUCT/DISTRIBUTION PORTFOLIO OVERVIEW
7
Coff
ee Turkish Coffee
Espresso coffee
Instant coffee
Sa
vo
ury
sp
rea
ds Meat spreads
Fish spreads
Sandwiches
Sn
acks Savoury snacks
Chocolate tablets
Wafers & Biscuits
Bars
Sp
ort
s a
nd
fun
ctio
nal fo
od
Sports food
Weight management range
Energy range
Body building range
Dis
trib
utio
n
Own brands
International brands
Be
ve
rage
s Carbonated soft drinks
Vitamin instant drinks
Functional waters
Waters
Tea and Functional tea
Pe
rson
alca
re
Body care
Face care
Lip care
Tooth care
Ph
arm
a Food supplements
OTC products
Pharmacy chain
Ba
by f
oo
d
Baby cereals
Milk formula
Tea
Water
Biscuits
ATLANTIC GRUPA’S GREATEST ASSETS
Brands with key market positions - among the top 3 in their category based on latest available data. Market position ranking based on volume (items) market share. Data source: Nielsen
Retail Panel, PharMIS and company data.
8
Croatia
Serbia
Slovenia
Bosnia and
Herzegovina
Macedonia
Germany
Italy
United
Kingdom
Austria
Switzerland
Ukraine
GEOGRAPHIC PRESENCE AND MACROECONOMIC ENVIRONMENT
9
Sales by countries in 2013; *Other regional markets: Macedonia, Montenegro, Kosovo; **Key European markets: Germany, UK, Italy, Switzerland, Austria, Sweden, Spain; Macro data source:
European Commission, European Economic Forecast, Winter 2014; for FX rates - National Bank of Serbia, UniCredit CEE 4Q14, HAAB SEE Outlook June 2014, RBA CEE Strategy 4Q14.
Slovenia
Croatia
Bosnia and
HerzegovinaSerbia
Macedonia+ production facility
in Germany
Overview of production facilities
Croatia24.8%
Serbia24.1%
Slovenia13.6%
Bosnia and Herzegovina
7.2%
Other regional markets*
6.3%
Key European markets**
11.7%
Russia and CIS5.9%
Other markets6.4%
Sales by countries Croatia 2011 2012 2013f 2014f 2015f
GDP 0.0% (2.0%) (0.7%) 0.5% 1.2%
Unemployment 13.5% 15.9% 17.6% 17.6% 17.2%
CPI 2.2% 3.4% 2.3% 1.3% 1.5%
EUR/HRK 7.43 7.52 7.57 7.63 7.64
Serbia 2011 2012 2013f 2014f 2015f
GDP 1.6% (1.5%) 2.1% 1.3% 2.2%
Unemployment 23.0% 23.9% 22.1% 22.3% 21.4%
CPI 11.1% 7.3% 7.9% 4.3% 5.0%
EUR/RSD 101.97 113.09 113.11 117.09 120.90
Slovenia 2011 2012 2013f 2014f 2015f
GDP 0.7% (2.5%) (1.6%) (0.1%) 1.3%
Unemployment 8.2% 8.9% 10.2% 10.8% 10.7%
CPI 2.1% 2.8% 1.9% 0.8% 1.3%
EUR/USD 1.39 1.29 1.33 1.36 1.27
Germany 2011 2012 2013f 2014f 2015f
GDP 3.3% 0.7% 0.4% 1.8% 2.0%
Unemployment 5.9% 5.5% 5.3% 5.2% 5.1%
CPI 2.5% 2.1% 1.6% 1.4% 1.4%
EUR/USD 1.39 1.29 1.33 1.36 1.27
Russia 2011 2012 2013f 2014f 2015f
GDP 4.3% 3.4% 1.3% 2.3% 2.7%
Unemployment 6.6% 5.5% 5.5% 5.9% 6.2%
CPI 8.4% 5.1% 6.8% 5.9% 5.0%
EUR/RUB 40.89 40.07 42.36 48.21 49.85
SALES PROFILE AND BUSINESS ENVIRONMENT
10
Sales by segments and brands in 2013; Business environment source: www.confectionerynews.com, http://uk.synergytaste.com, www.beveragedaily.com, IGD Retail Analysis.
Top 5 factors influencing F&B industry
Collaboration in innovation
Between ingredient and packaging firms and industry
Ethics at eye level
Environmental stewardship, animal welfare and fair play for workers
are among conditions of production that consumers now expect
Rising food prices
Smaller grain stockpiles, a growing population, increased demand for
animal protein and a changing climate disrupt supply/demand balance
Food taxes and subsidies
Balance taxes on less healthy foods with subsidies for healthy ones
Simple ingredients
Key retail trends
Shoppers hungry for value
Online, digital and multi-channel
Redefinition of private label
Making the most of events
Focus on the store environment
Principal brands15.0%
Sports and Functional
Food15.5%
Pharma & Personal
care 9.7%
Coffee21.5%
Sweet and salted snacks
12.2%
Savoury spreads
9.1%
Beverages 12.9%Baby food
4.2%
Sales by segments
Own brands72.5%
Principal brands15.0%
Private label6.4%
Farmacia6.1%
Sales by brands
FINANCIAL OVERVIEW: 2010 – 2013
11
P&L figures normalized; *Gearing ratio calculated as Net debt/(Total equity+Net debt); ** For FY10 calculated on pro-forma level.
(EURm) FY10 FY10 pro-forma FY11 FY12 FY13CAGR FY10
pro-forma - FY13FY13/FY12
Revenues 306 609 637 665 679 3.7% 2.2%
Sales 302 602 630 657 674 3.8% 2.5%
EBITDA 27 70 69 74 79 3.9% 5.8%
EBIT 20 37 47 53 57 15.5% 6.4%
Net profit 11 17 9 15 27 16.6% 76.9%
EBITDA margin 8.9% 11.7% 10.9% 11.3% 11.7% +3bp +37bp
EBIT margin 6.5% 6.1% 7.4% 8.1% 8.4% +229bp +31bp
Net profit margin 3.8% 2.8% 1.5% 2.3% 3.9% +116bp +166bp
Net debt 333 333 333 314 275
Total assets 701 701 714 687 678
Equity 194 194 202 195 223
Gearing ratio* 63.2% 63.2% 62.3% 61.7% 55.2%
Net debt/EBITDA 4.7 4.7 4.8 4.2 3.5
Cash Flow from operating
activities14 n/a 22 39 56
Balance sheet as of YE10 reflected
consolidation of Droga Kolinska, but P&L
accounts were not consolidated in FY10
(consolidation started as of 01/01/2011).
In 2014, the classification of contracted
marketing expenses has changed from
“Marketing and selling expenses” to
decrease in “Sales revenues”, and
classification of support for contracted
marketing expenses has changed from
decrease in “Marketing and selling
expenses” to decrease in “Cost of
merchandise sold”. This reclassification
decreases above presented sales by
EUR 6 million in 2013 and EUR 5.5
million in 2012.
GUIDANCE TRACK RECORD
12
Atlantic Grupa listed on the Zagreb Stock Exchange on
19th of November 2007.
Since 2008 Atlantic Grupa publishes guidance for the
following financial year and delivers it.
0
100
200
300
400
500
600
700
2008 2009 2010 2011 2012 2013
EBITDA (HRKm)
100%98% 101%
98%102%
101%
0
1.000
2.000
3.000
4.000
5.000
6.000
Sales EBITDA EBIT
4.930
559399
4.964
550385
Reported Guidance99%
102%104%
0
100
200
300
400
500
2008 2009 2010 2011 2012 2013
EBIT (HRKm)
104%99%
95%
97%
104%101%
0
1.000
2.000
3.000
4.000
5.000
6.000
Sales EBITDA EBIT
4.930
559399
4.964
550385
Reported Guidance99%
102%104%
0
100
200
300
400
500
600
700
800
2008 2009 2010 2011 2012 2013
Sales (EURm)
93% 103% 99%
102%99% 98%
0
1.000
2.000
3.000
4.000
5.000
6.000
Sales EBITDA EBIT
4.930
559399
4.964
550385
Reported Guidance99%
102%104%
13
PERFORMANCE ON CROATIAN CAPITAL MARKET
The Atlantic Grupa’s share significantly outperformed the growth
of Crobex and Crobex10 and ended at 30 September 2014 at
EUR 137.3, which was a 58,5% growth within a year.
* Closing price multiplied by the total number of shares
** EV and price multiples are calculated with the last price at 30 September 2014 and for
the TTM 1H 2014 period
*** Performance on capital market: percentage obtained as difference between closing
price at 31 December of current year and closing price at 31 December of previous year
as well as closing price at 30/9/2014 and closing price at 31 December 2013
0.00
50.00
100.00
150.00
0
1,000
2,000
3,000
4,000
5,000
6,000
EU
R
Po
ints
ATGR-R-A vs CROBEX
CROBEXATGR-R-A
30/09/2014 31/12/2013
Last price 137.3 95.7
Market capitalization* (in EUR millions) 457.9 319.2
Valuation 1H2014
Last price (30/09/2014) 137.3
Market capitalization* (in EUR millions) 457.9
Average daily turnover (in EUR
thousands)46.3
EV (in EUR millions) ** 734.4
EV/EBITDA** 9.2
EV/EBIT** 12.6
EV/sales** 1.1
EPS (in EUR) 8.5
P/E** 16.2
43%34%
7%
-38%
18%
48%
-47%
8% 2% 1%
-18%
5%16%
-67%
10%2%
0%
-15%
9%
-80%
-40%
0%
40%
9M 2014 2013 2012 2011 2010 2009 2008
Performance on capital market ATGR-R-A
Crobex
Crobex10
CONTENT
OVERVIEW OF ATLANTIC GRUPA
FINANCIAL OVERVIEW IN H1 2014
FINANCIAL OVERVIEW IN 2013
STRATEGIC GUIDANCE
14
15
FINANCIAL OVERVIEW IN H1 2014
In the first half of 2014, Atlantic Grupa recorded 2.1% higher revenue due
to the growth in sales in the SBU Savoury Spreads, the SDU International
Markets and the beginning of the Unilever principal distribution in the SDU
Croatia and the DU Slovenia. The growth in these units compensated for
the lower result of other business segments. If we exclude the effect of new
and old principals and unfavourable impacts of movements in exchange
rates, the sales remained at the level of the first half of 2013.
3.6% higher EBITDA as a result of :
the growth in sales and
active risk management related to the movements in the price of raw
coffee in the global markets.
In the first half of 2014, a 5.4% higher EBIT was recorded, whereby the
improved operating profitability was achieved primarily due to the impacts
above the EBITDA level and due to lower depreciation which is the result of
a more efficient management of the existing resources, reducing the need
for new investments.
22.7% higher net profit due to:
The impacts above the EBIT level,
Significant decrease in interest expense by 16.5% due to a successful
refinancing of long-term borrowings completed at the end of 2012 and
Decrease in the effective tax rate to 13% from the previous year’s
20%.
Nevertheless, net foreign exchange gains are significantly lower compared
to the same period of the previous year, primarily due to the depreciation of
the Serbian dinar.
Key highlights
(EURm)H1 2014 H1 2013
H1 2014/H1
2013
Revenues 329.9 323.1 2.1%
Sales 327.2 320.5 2.1%
EBITDA 40.0 38.6 3.6%
EBIT 30.8 29.2 5.4%
Net profit 19.1 15.6 22.7%
EBITDA margin 12.2% 12.0% +17 bp
EBIT margin 9.4% 9.1% +29 bp
Net profit margin 5.8% 4.9% +98 bp
16
PERFORMANCE BY STRATEGIC BUSINESS UNITS AND STRATEGIC DISTRIBUTION UNITS
* Other segments include SDU HoReCa, SDU CIS, BU Baby Food, DU Macedonia and business activities not allocated to business and distribution units (headquarters and support
functions in Serbia, Slovenia and Macedonia) which are excluded from the reportable operating segments.
** Line item “Reconciliation” relates to the sale of own brands which is included in the appropriate SBU and BU and in SDUs and DUs through which the products were distributed.
*** In 2014 the classification of contracted marketing expenses has changed from “Marketing and selling expenses” to decrease in “Sales revenues”, and classification of support for
contracted marketing expenses has changed from decrease in “Marketing and selling expenses” to decrease in “Cost of merchandise sold”. In accordance with these changes, sales
revenue (referring to sales from distribution company Atlantic Trade Zagreb) for segment information for the six month period ended 30 June 2013 has also been restated, but no
restatement has been made for sales revenue referring to SBU Savoury Spreads on markets outside the region and BU Baby Food due to immateriality.
(EUR 000) H1 2014 H1 2013***H1 2014/
H1 2013
SBU Beverages 42 44 (4.0%)
SBU Coffee 64 67 (5.5%)
SBU (Sweet and Salted) Snacks 37 39 (4.1%)
SBU Savoury Spreads 29 28 5.8%
SBU Sports and Functional Food 53 55 (2.8%)
SBU Pharma and Personal Care 32 32 (0.4%)
SDU Croatia 54 47 14.7%
SDU Serbia 68 73 (7.1%)
SDU International markets 39 38 3.4%
DU Slovenia 45 36 22.6%
Other segments* 52 52 (0.4%)
Reconciliation** (189) (192) n/p
Sales 327 320 2.1%
(in EUR millions) H1 2014 H1 2013H1 2014/
H1 2013
SBU Beverages 8.5 8.0 5.8%
SBU Coffee 16.0 13.5 18.2%
SBU (Sweet and Salted) Snacks 6.7 7.0 (3.7%)
SBU Savoury Spreads 7.8 6.5 20.8%
SBU Sports and Functional Food 1.7 2.0 (14.9%)
SBU Pharma and Personal Care 2.6 3.0 (12.1%)
SDU Croatia 1.3 0.9 46.3%
SDU Serbia 1.4 2.1 (30.3%)
SDU International markets 0.7 1.6 (54.2%)
DU Slovenia 1.4 1.7 (15.4%)
Other segments* (8.2) (7.5) 9.0%
Group EBITDA 40.0 38.6 3.6%
17
FINANCIAL INDICATORS IN H1 2014
The company's focus on a continued deleveraging
Overview of capital expenditure:
SBU Coffee: purchase of espresso machines and Coffee 2 Go machines, investment in the transport system for ground coffee,
SBU Snacks: investment in the line for the production of fillings, purchase of production equipment for the production of chocolate bars,
SBU Sports and Functional Food: investment in the production plant for the production of bars in Nova Gradiška,
SDU Croatia and SDU Slovenia: investments related to taking over the distribution of Unilever (IT, warehouses, offices).
Capital and reserves34.2%
Long term borrowings
32.8%
Short term borrowings
8.3%
Bond2.2%
Trade and other payables
16.2%
Other liabilities
6.4%
Equity and liabilites structure as at 30/06/2014
(in EUR millions) H1 2014 2013
Net debt 268.1 274.6
Total assets 690.0 677.7
Total Equity 235.7 223.3
Current ratio 1.7 1.8
Gearing ratio 53.2% 55.2%
Net debt/EBITDA* 3.3 3.5
H1 2014 H1 2013
Interest coverage ratio 4.4 3.6
Capital expenditure 8.1 4.2
Cash flow from operating activities 13.5 22.8
CONTENT
OVERVIEW OF ATLANTIC GRUPA
FINANCIAL OVERVIEW IN H1 2014
FINANCIAL OVERVIEW IN 2013
STRATEGIC GUIDANCE
18
19
PERFORMANCE BY STRATEGIC BUSINESS UNITS AND STRATEGIC DISTRIBUTION UNITS
* Sales and profitability shown according to AG’s business model valid in 2012 and 2013. Other segments include SDU HoReCa, Russian market and non-allocable
business activities (headquarters and support functions in Serbia, Slovenia and Macedonia) which are excluded from the reportable operating segments. SDU
International Markets’ sales and profitability is presented within SBU to which they relate. The Russian market includes only the baby food product range sales under
the Bebi brand.
** Line item “Reconciliation” relates to the sale of own brands which is included in the appropriate SBU and in SDUs through which the products were distributed.
*** Sales correspond to figures shown in 2013 Audit Report. In 2014, the classification of contracted marketing expenses has changed from “Marketing and selling
expenses” to decrease in “Sales revenues”, and classification of support for contracted marketing expenses has changed from decrease in “Marketing and selling
expenses” to decrease in “Cost of merchandise sold”. This reclassification decreases above presented sales by EUR 6 million in 2013 and EUR 5.5 million in
2012.
EUR millions 2013 2012 2013/2012
SBU Beverages 87 90 (3.0%)
SBU Coffee 145 145 (0.3%)
SBU (Sweet and Salted) Snacks 82 80 2.8%
SBU Savoury Spreads 61 62 (1.0%)
SBU Sports and Functional Food 104 91 14.9%
SBU Pharma and Personal Care 67 64 5,1%
SDU Croatia 108 117 (8.0%)
SDU Slovenia, Serbia, Macedonia 258 257 0.4%
Other segments* 56 50 13.5%
Reconciliation** (296) (298) (0.8%)
Sales 674 657 2.5%
(EUR millions) 2013 2012 2013/2012
SBU Beverages 16.3 18.3 (10.8%)
SBU Coffee 31.8 20.9 52.3%
SBU (Sweet and Salted) Snacks 14.9 15.4 (3.0%)
SBU Savoury Spreads 16.4 16.4 0.4%
SBU Sports and Functional Food 3.0 1.9 57.5%
SBU Pharma and Personal Care 6.4 7.6 (16.3%)
SDU Croatia 2.0 1.7 20.8%
SDU Slovenia, Serbia, Macedonia 11.0 11.3 (2.3%)
Other segments* (23.2) (18.9) 22.3%
Group EBITDA 78.8 74.5 5.8%
20
NET PROFIT IN 2013
1.8 times higher net profit due to:
Significant decrease in interest expense amid successful
refinancing of long-term borrowings completed at the end of
2012.
More favourable movements in foreign exchange rates,
which decreased the previous year’s net foreign exchange
losses arisen primarily due to the depreciation of the
Serbian dinar.
Negative impact had the significant increase in effective tax
rate to 21% from the previous year’s 6% due to the last year
recognised deferred tax asset based on the expected
utilisation of tax losses.
*Normalized
0
10
20
30
40
50
2013 2012
27
9
27
15
Net profit
Normalized Net profit
EURm
(in EUR 000) 2013 % of sales 2012* % of sales 2013/2012
EBIT 56,616 8.4% 53,230 8.1% 6.4%
Interest expenses, net (21,235) (3.2%) (28,716) (4.4%) (26.1%)
Net FX differences (1,627) (0.2%) (8,525) (1.3%) (80.9%)
EBT 33,754 5.0% 15,990 2.4% 111.1%
Current tax (5,698) (0.8%) (3,463) (0.5%) 64.5%
Deferred tax (1,523) (0.2%) 2,468 0.4% n/a
Net income 26,532 3.9% 14,994 2.3% 76.9%
Minority interest (550) (0.1%) (1,451) (0.2%) (62.1%)
Net income II 25,983 3.9% 13,543 2.1% 91.8%
21
FINANCIAL INDICATORS IN 2013
The company's focus on a continued deleveraging
Overview of capital expenditure:
SBU Coffee: automation of the line for coffee and purchase of espresso and Coffee 2 Go machines,
SBU Snacks: investment in the flips packaging machine, investment in the equipment for the production of pellets and purchase of line for the
production of fillings,
SBU Beverages: investment in the line for packaging multi-packs of Donat Mg, investment in the equipment for the production of the Donat Mg
new bottle, purchase of automated line for packaging Cedevita granules,
SBU Pharma and Personal care: refurbishment of pharmacies and specialised stores and
Other: investments related to the HRIS system (human resources information system) and the project of developing, implementing and relocating
the regional data centre in Zagreb.
* Normalized in 2012
Capital and reserves32.9%
Long term borrowings
36.5%Short term borrowings7.6%
Bond2.3%
Trade and other payables
14.5%
Other liabilities6.2%
Equity and liabilities structure as at 31/12/2013(in EUR millions) 2013 2012
Net debt 274.6 313.8
Total assets 677.7 686.6
Total Equity 223.3 194.8
Current ratio 1.8 1.8
Gearing ratio 55.2% 61.7%
Net debt/EBITDA* 3.5 4.2
Interest coverage ratio* 3.7 2.6
Capital expenditure 13.3 10.5
Cash flow from operating activities 56.0 39.5
CONTENT
OVERVIEW OF ATLANTIC GRUPA
FINANCIAL OVERVIEW IN H1 2014
FINANCIAL OVERVIEW IN 2013
STRATEGIC GUIDANCE
22
23
STRATEGIC GUIDANCE FOR 2014
Strategic
management
guidance
Focus on organic business growth through active brand management with a special emphasis on strengthening
the position of regional brands (Cockta, Cedevita, Smoki, Grand Kafa, Barcaffe, Bananica, Štark) and brands with
international potential (Multipower, Argeta, Donat Mg, Bebi, Cedevita GO!);
Strengthening the regional character of distribution through the extension of the principals’ brands portfolio;
Active development of the regional HoReCa segment with a portfolio that covers '24/7 consumer needs' and other
sale channels (Online, Etno channel);
Rationalisation of operations, cost management and optimisation of business processes on all operating levels
aimed at improving operating efficiency;
Active monitoring of trends and hedging the price of raw coffee and other raw materials;
Regular settlement of existing financial liabilities with an active management of debt and financial expenses; and
Prudent liquidity management and further deleveraging.
Sales: 3% sales growth at the organic level and sales from the distribution of the Unilever product range of EUR 32 million.
Capital expenditure at EUR 29 million, 46% of which relates to the investment in the new factory of energy bars in Nova Gradiška.
The expected effective tax rate in 2014 should be at the 2013 level.
(in EUR millions) 2014 Guidance 2013 2014/2013
Sales 725 674 7.7%
EBITDA 83 79 4.9%
EBIT 61 57 8.3%
Interest expense 19 21 (12.1%)
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