Welcome - Heineken

Welcome
Nigeria | November 2012
Heineken N.V.
Growing with Africa
Jean-François van Boxmeer
Chairman of the Executive Board and CEO
Nigeria | November 2012
Heineken N.V.
Disclaimer and Basis of pro-forma
combined financial metrics
All statements other than statements of historical facts included in this presentation are or may be forward-looking statements. These forward-looking statements reflect HEINEKEN’s
current expectations, beliefs, hopes, intentions or strategies regarding the future and assumptions in light of currently available information. Such forward-looking statements are not
guarantees of future performance or events and involve known and unknown risks and uncertainties. Accordingly, actual results may differ materially from those described in such
forward-looking statements. Many of these risks and uncertainties relate to factors that are beyond HEINEKEN’s ability to control or estimate precisely, such as future market and
economic conditions, the behaviour of other market participants, changes in consumer preferences, the ability to successfully integrate acquired businesses and achieve anticipated
synergies, costs of raw materials, interest rate and foreign exchange fluctuations, change in tax rates, changes in law, changes in pension costs, the actions of government regulators
and weather conditions. These and other risk factors are detailed in HEINEKEN’s publicly filed annual reports. You should not and are cautioned not to place undue reliance on such
forward-looking statements, which speak only as of the date of this presentation. HEINEKEN does not undertake any obligation to update publicly or revise any forward-looking
statements to reflect events or circumstances after the date of these materials. Market share estimates contained in this presentation are based on outside sources such as specialised
research institutes in combination with management estimates.
Nothing in this document should be interpreted to mean that earnings per share of HEINEKEN, Heineken International B.V. (“HIBV”) or Asia Pacific Breweries Limited (APB) will necessarily
be greater than those for their respective preceding financial periods.
HEINEKEN’s acquisition of control of APB is subject to completion of the sale and purchase agreements (“SPAs”) entered into between HIBV and Fraser and Neave, Limited. Completion
of the SPAs will only occur if and when the relevant conditions precedent set out in the SPAs are satisfied and/or waived. Please refer to the pre-conditional offer announcement made
by HIBV on 17 August 2012 (“Pre-conditional Offer Announcement”), for further information.
This presentation should be read in conjunction with the Pre-conditional Offer Announcement. A copy of the Pre-Conditional Offer Announcement is available on www.sgx.com.
The pro-forma combined financial metrics for the year ended December 31, 2011 are presented to show how these metrics might have looked if the Proposed Transaction had
occurred on January 1, 2011. The unaudited pro forma combined financial metrics have been derived by applying pro forma adjustments to the historical financial information of APB
for the statutory year ended September 30, 2011.
The unaudited pro-forma combined financial metrics have been presented for informational purposes only and are not necessarily indicative of what the combined company’s financial
position or results actually would have been had the Proposed Transaction been completed as of January 1,2011. In addition the unaudited pro-forma combined financial metrics do
not purport to project the future financial position or operating results of the combined company. There can be no assurance that the assumptions used in the preparation of the pro
forma combined financial metrics prove to be correct.
The unaudited pro-forma combined financial metrics are based on:



3
The consolidated financial statements of HEINEKEN for the year ended December 31, 2011, prepared in accordance with IFRS;
Pro-forma consolidated information of APB derived from the consolidated financial statements of APB and APIPL for the year ended September 30, 2011 prepared in accordance
with Singapore Financial Reporting Standards (“Singapore FRS”), and adjusted by adding the three months period ended December 31, 2011 and deducting the three months
period ended December 31, 2010 and certain pro-forma adjustments for accounting policy alignment;
Pro-forma adjustments to eliminate intercompany volume and revenue, and HEINEKEN’s share of profit of APB and APIPL currently included in the HEINEKEN results for the year
ended December 31, 2011;

Certain pro-forma adjustments relating to the purchase price allocation;

APB and APIPL financial metrics are converted to EUR:SGD for the year ended December, 31 2012 of 1.75
Agenda
Growing with Africa
1 A growing exposure to emerging markets
2 Africa & the Middle East: A region with
huge potential
4
Increasing exposure to emerging markets
is a key business priority
HEINEKEN’s Strategic Business Priorities
Grow
Heineken®
brand
Consumerinspired,
customeroriented,
brand-led
Capture the
opportunities
in emerging
markets
Leverage
the
benefits of
HEINEKEN’s
global
scale
Drive
personal
leadership
1 23 45
5
Post-APB completion, emerging markets will
represent over 60% of HEINEKEN’s business
Consolidated beer volume
(mhl)
Developed
EBIT (beia)1
(€bn)
Developed
Emerging
Emerging
3.0
178
105
62%
2007 HEINEKEN
38%
60%
2011 Pro-Forma
2007 HEINEKEN
Stand alone
6
55%
40%
51%
49%
1.7
Source: HEINEKEN
Including Asia Pacific Breweries on a pro-forma basis for 2011
1 EBIT split excludes Head Office and Eliminations
Stand alone
45%
2011 Pro-Forma
HEINEKEN has a strong and well diversified
emerging market footprint
Market position in emerging regions by volume
#1
#2
#3
#4
Africa & Middle East
Other
nm
Southeast Asia & the
Pacific Islands
SAN
/ MIGUEL BREWERY INC.
SAN MIGUEL BREWERY INC.
China, South Korea,
Mongolia
/
India, Sri Lanka1
Latin America
Eastern Europe
(incl. Russia)
7
#2 IPS China
/
Source: Plato (May 2012), HEINEKEN
Note: Latin America includes Mexico, Caribbean, Central and South America
1 Sri Lanka is a market within APB; India represents JV operations of UBL, jointly held with Dr. Vijay Mallya
nm
nm
HEINEKEN’s strategy to win in emerging
markets
8
1
Invest to build strong brands
2
Optimise route-to-market
3
Build strong local teams
4
Invest ahead of the curve
5
Build the international premium segment
6
Engage with Government
7
‘Brewing a Better Future’
8
Explore new market opportunities
Agenda
Growing with Africa
1 A growing exposure to emerging markets
2 Africa & the Middle East: A region with
huge potential
9
Africa: A continent offering huge potential
A booming population:
 The world's 2nd largest and 2nd most
populous continent
 Population growing at a CAGR of 2% to 2020
 By 2020 – will represent 20% of world’s
population
 By 2050 – over 2.0bn people
Strong expected economic growth1:
 Average annual GDP growth of 6% to 2020
 Six of the top ten fastest growing
economies in the world are in Africa
Improving political stability
An emerging, brand-conscious middle-class
10
Source:
1 IMF, world economic outlook database; GDP in Purchasing Power Parity
international US$
Attractive growth prospects for the beer
market in AME
Profitable growth opportunity
 Dynamic population (<30 years):
 2011-20E beer market CAGR:
 Size of profit pool:
4.1%
€2.0bn
Beer market
size 2011
(mhl)
Beer market
CAGR
2011-20E
Population
2011
(m)
Population
CAGR
2011-20E
Beer
consumption
per capita (l)
Profit pool
2010
(€m)
Profit per hl
2010
(€)
114
4.1%
1,250
2.0%
9
2,020
19
79
4.8%
614
1.0%
13
1,250
17
China, South
Korea, Mongolia
507
3.6%
1,399
0.3%
36
970
2
India, Sri Lanka
19
9.3%
1,263
1.2%
2
40
2
Latin America
242
2.9%
596
1.0%
41
6,700
29
Eastern Europe
(incl. Russia)
254
1.4%
479
0.2%
53
2,500
10
Africa & the
Middle East
Southeast Asia &
the Pacific Islands
11
67%
Source: Plato (May 2012), Global Insight, Euromonitor, Sanford Bernstein (2010) and HEINEKEN
Note: Latin America includes Mexico, Caribbean, Central and South America
AME is a significant part of HEINEKEN’s business…
Consolidated beer volume
Revenue
12%
12%
AME
Other Regions
Heineken® brand volume in IPS
AME
2011 EBIT (beia)1
11%
AME
12
Other Regions
Other Regions
19%
AME
Data for the year ended 2011
Includes Asia Pacific Breweries on a pro-forma basis for 2011
1 EBIT (beia) results from operating activities + share of profit from JVs. EBIT split excludes Head Office and Eliminations
Other Regions
…and a key driver of HEINEKEN’s future growth
AME share of HEINEKEN EBIT (beia)1 organic
growth % (2007-2011)
AME: Revenue 2007-2011 (€ million)
Organic CAGR +15%
1,774
1,817
2008
2009
2,223
1,988
1,416
42%
2007
2010*
2011
AME: EBIT (beia) 2007-2011 (€ million)
Organic CAGR +19%
453
560
570
2010*
2011
485
309
AME
Other Regions
2007
13
1 EBIT (beia) exclude Head Office and Eliminations
Includes Asia Pacific Breweries on a pro-forma basis for 2011
*2010 restated
2008
2009
HEINEKEN has strong leadership positions in AME
Thirteen #1 and four #2 positions
Beer market
Growth
CAGR %
(2011-20)
Per Capita
Consumption
(2011)
Pop.
(2011 in
millions)
Population
CAGR %
(2011-20)
Nigeria
5.6%
10.7
164
2.4%
Democratic
Republic of
Congo
6.2%
6.5
71
3.3%
Egypt
3.9%
1.5
78
1.3%
Republic of
Congo1
5.0%
44.9
4
2.9%
Burundi
5.7%
19.8
9
2.7%
Rwanda
5.0%
11.9
10
2.2%
Ghana1
3.0%
6.7
24
1.9%
Namibia1
2.7%
44.4
2
2.0%
La Reunion
2.4%
29.0
1
0.8%
Sierra Leone
4.1%
2.8
6
2.5%
Israel1
2.6%
17.7
8
1.2%
United Arab
Emirates1
1.6%
20.7
4
1.5%
Lebanon
6.1%
9.0
4
1.4%
South Africa1
1.5%
58.8
50
1.0%
Algeria
1.8%
3.7
36
1.3%
Tunisia
1.8%
13.3
11
1.1%
Ethiopia
7.2%
3.7
83
2.3%
Country
(#1 and #2
positions)
#1Position
#2 Position
14
Source: Plato May and August 2012
1 Joint venture or Associate investment
….complemented by key strategic alliances and
partnerships
Operation
Sirocco
Partner
HEINEKEN ’s
JV/ Associate
interest
United Arab Emirates
50%
Republic of Congo
50%
Tempo
Israel
40%
General Investment Company
Jordan
10.8%
Guinness Ghana Breweries Limited
Ghana
20%
Namibian Breweries
Namibia
14.6%
Groupe des Brasseries du Maroc
Morocco
2.2%
South Africa
50%1
Cameroon
8.8%
Brasserie du Congo
Brandhouse
Les Brasseries du Cameroun
Bottling, sales and distribution of soft drinks
15
Country
Democratic Republic of
Congo, Rwanda, Republic
of Congo, Burundi, La
Reunion
1 HEINEKEN owns 42.25% of DHN and 75% of Sedibeng Brewery; Diageo and DHN jointly own 50%
of Brandhouse
A strong portfolio of global, regional and local
brands
16
Global Brands
Regional Brands
Local Brands
Heineken®, Amstel,
Desperados, Sol
& Strongbow
Primus, Star, Mützig,
Turbo King, Gulder
& Maltina
Established local
brands
Winning in the international premium segment
IPS in AME is a high growth segment
2011F (mhl)
HEINEKEN has clear leadership amongst
global IPS brands in AME (2010 mhl)
41
25
33
26
11
Africa &
Asia Pacific Central &
Eastern
Western
Americas
Europe
Europe
CAGR
(2006-2011F):
17
2.7
0.6
Middle East
+8.3%
3.0
+11.0%
+4.4%
Source: Plato July 2012, Plato November 2011
-1.0%
+1.4%
0.5
0.1
0.1
-
-
HEINEKEN has been investing ahead of the
curve to meet growing demand
New Capacity*
16 mhl
Since 2009
COUNTRIES
Nigeria
South Africa
DR of Congo
Republic of Congo
Rwanda
Burundi
Tunisia
18
*Technical capacity
Targeted acquisitions in key markets
to accelerate growth
Acquisitions
6
Since 2002
COUNTRIES
Nigeria (SONA)
Ethiopia
Algeria
Egypt
Israel
Lebanon
19
A strong commitment to grow with Africa
‘Brewing a Better Future’
We believe in Africa
20
We are Partners
for Growth
We are Committed
to Improving Lives
€1.7bn of investments1
since 2005
Local sourcing
Community
Stock listed Subsidiaries
Economic Impact Studies
Healthcare
1
Capital expenditure in AME (2005-11)
Supporting rice farming in the
Democratic Republic of Congo
21
Programme
Financial Markets Conference 2012, Lagos
Day 1
Day 2
An Emerging Opportunity
Siep Hiemstra, HEINEKEN
Africa on the Move
Lieven Van der Borght, HEINEKEN
Leadership in an Attractive Beer Market
Nico Vervelde, Nigerian Breweries
Supply Chain Excellence
Samson Aigbedo, Nigerian Breweries
Leader in Affordability
Boudewijn Haarsma, Consolidated
Breweries
Closing remarks
René Hooft Graafland
Talent Development & Culture
Victor Famiyibo, Nigerian Breweries
Winning with Nigeria!
Hubert Eze, Nigerian Breweries
Lagos Market Overview
Moses Ogbodo, Nigerian Breweries
22
Brewery visit
Optional
Questions
Nigeria | November 2012
Heineken NV