1 / 53

TATA Tea Group 2008/2009 Results Presentation Peter Unsworth

TATA Tea Group 2008/2009 Results Presentation Peter Unsworth. Introducing The Tata Tea Group. Creating a global leader in branded good for you beverages Five businesses being operationally integrated a nd transformed to make one global beverage group. Led by a Single Management Team.

slama
Download Presentation

TATA Tea Group 2008/2009 Results Presentation Peter Unsworth

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. TATA Tea Group 2008/2009 Results Presentation Peter Unsworth

  2. Introducing The Tata Tea Group • Creating a global leader in • branded good for you beverages • Five businesses being operationally integrated and transformed to make one global beverage group

  3. Led by a Single Management Team • Peter Unsworth – CEO Tetley Group • Percy Siganporia – MD Tata Tea, Chairman MEMW • Hamid Ashraff – MD Tata Coffee • L Krishna Kumar – Chief Financial Officer • Nalin Miglani – Chief HR Officer • John Nicholas – Chief Marketing Officer

  4. Key Highlights for 2008/09 • Strong performance with resilient core categories in difficult economic and trading conditions • Product portfolio expands • Strong brand growth in our target categories • Integration and transformation

  5. Key Highlights for 2008/09 • Group operating income up 12% at Rs 4874 crores • Group PBT before exceptional up 21% at Rs 531 crores • Group PBT lower by 39% at Rs 1256 crores as compared PY figure of Rs 2060 cr* • * PY figure include one time profit on sale of EBI amounting to Rs 1608 crores

  6. The Pillars of our Business Strategy

  7. Products & Categories Moving from a tea and coffee company to a wider beverage business spanning six product categories

  8. Brands A new central marketing function driving global brands management and innovation

  9. Distribution Expansion into new geographies underway – Russian entry recently announced

  10. People A single management team and six consumer/customer focused regions

  11. Process Gaining scale economies through common systems

  12. The Business Strategy – Products & Categories

  13. Innovation Drives Category Growth Water:Expansion of Himalayan water range into more cities in India RTD: National launch of Tetley Iced Tea following successful test market in Canada National launch of Tetley Infusions (iced tea concentrate sachets) in Canada Test market launch of T!on juice drinkin India

  14. Expansion of Product Portfolio Tea:National launch of Tetley Red Tea in Canada National launch of Good Earth Organic teas in UK Coffee: National launch of Good Earth Organic Coffee in USA

  15. The Business Strategy - Brands

  16. The Business Strategy - Global & Regional Brands Regional Focus Brands Tata Coffee

  17. Share Growth in Tea Brands in Core Market Strong Tea Performance Relative to Peers % Core Markets Tea Value Share % Core markets include India, UK, US, Canada, Australia, Poland, France, Czech Republic Source: Euromonitor 2008

  18. Global Brands Performance Highlights Record brand shares in both Canada and France launched into UK and Canada (Tea), US (Coffee) Premium, Agni and Gold all exhibiting strong growth post the Jaago Re campaign and despite increased consumer pricing

  19. Regional Brands Performance Highlights strong gains in both rate of sale and distribution in continued growth after brand relaunch awarded ‘Product of the Year’ by Polish consumers

  20. Focus on Brands • Ability to drive marketing excellenceacross different countries and cultures • Here’s a flavour...

  21. Focus on BrandsThe Growth Story of Tetley Redbush Following the success of the 40’s pack – larger pack sizes and new variants have been introduced In the UK Tetley Redbush is the No. 2 brand in the UK with a 26% market share Introduction into the Canadian market in 2008 One of the fastest growing brands in the UK tea segment

  22. Focus on BrandsThe Impact of the “Jaago Re Campaign”

  23. Focus on BrandsEight O’Clock Coffee 100% Colombian Drives Brand Growth Source: *IRI, 52 weeks ended 3/22/09 **Internal sales data F’09

  24. The Business Strategy - Distribution

  25. Design of Tata Tea Group Organisation Now Six Regions: GB & Africa Europe & Middle East USA Canada & South America South Asia Asia Pacific

  26. Regional Highlights GB and Africa: Retained UK tea categorypartnership with Tesco Acquired CTC givingwest coast presence in South Africa

  27. Regional Highlights USA: Recent new CostCo and Walmart* listings South Asia: Launched T!on and extended distribution of Himalyan

  28. Regional Highlights Europe & Middle East: Entry into Russian market Canada & South America: Launch of Tetley RTD Iced Tea into over 6,000 conveniencestores across Canada

  29. Russia Market Entry Russia is the #2 tea market in the world Recent 51% acquisition of Grand A major Russianpackaging and distributioncompany in coffee and tea

  30. The Business Strategy - People

  31. Building a global organisation New single management structure in place New and distinct company values defined Integrated Global Reward Strategy

  32. US Restructuring well underway • Centralized HQ for three US businesses • Cross fertilization of ideas across tea and coffee brands • Management and administration is consolidated reducing cost • Full integration expected to be realised by end of 2009/10

  33. The Business Strategy - Process

  34. World class processes continue to be built • Development of global information systems to support global integration • Consolidated global financial systemin place • Drive global efficiencies • Balanced scorecard for strategy implementation

  35. Outcomes of Strategies – The Global Picture Multi category portfolio Global consumer brands Global distribution coverage World-class business processes The place to be for exceptional talent

  36. The Tata Tea Group • A global leaderin good for you beverages • THANK YOU

  37. TATA Tea Group 2008/2009 Financial Results L Krishna Kumar, CFO

  38. Key Highlights for 2008/09 • Strong performance in difficult economic & trading conditions – but resilient core portfolio • Increase in input costs largely recovered through price increases • Benefits from effective management ofsterling currency risk

  39. Key Highlights for 2008/09 • Continued improvements in product portfolio and new launches • Initial costs of restructuring absorbed • Strong brand growth in our target categories

  40. Performance 2008/09 • Group operating income up 12% - growth in brand sales, price increases and favourable currency • Group PBT before exception up 21% - Cost increases offset by interest savings • Cost increases mainly on commodities, growth initiatives like water launch, brand launch/support in US, UK and Canada

  41. Performance 2008/09 • Other cost increases – market driven impact on domestic defined benefit retirement schemes • Group PBT lower mainly on account of one off items • One off items in the CY-exchange gain on surplus cash Rs 814 Crs (realised component Rs 471 Crs) actuarial provisions in UK Rs 54 Crs, last year gain on sale of EBI shares Rs 1607 Crs • EPS Rs 113 (Rs 250) EPS excluding exceptional items Rs 47.87 (Rs 41.50) reflecting improvement in underlying performance

  42. Performance for 2008/9 Currency: Indian Rs Crores 2008/09 2007/08 Variance Net Operating Income 4,874 4,336 538 EBIT 552 617 (66) PBT before Exceptionals 531 437 94 Exceptional Items 725 1,622 (897) PBT 1,256 2,059 (803) PAT 832 1,906 (1,074) Group Consolidated Net Profit 701 1,543 (842)

  43. Strong Brand Growth for 2008/9Coming from Tata Tea and Eight O’Clock Coffee IndianTea Brands 19.4% IndianTea Brands 21.1% Jemca 0.7% Tetley 42.2% Jemca 0.7% Tetley 48.5% Vitax 1.4% Vitax 1.6% Others 13.7% Others 16.1% Good Earth1.4% Good Earth1.4% Eight O’Clock 14.9% Eight O’Clock 16.9% Source : Internal

  44. Branded share of business increases Categorywise Sales Breakup 2007-08 Categorywise Sales Breakup 2008-09 Others 0.43% Others 0.82% Plantation& Extraction 11.31% Plantation& Extraction 9.95% Tea 72.65% Tea 73.95% Coffee 14.31% Coffee 16.58% Source : Internal

  45. US, South Asia and Canada driving sales growth Regions 2008/09 2007/08 Variance % GB & Africa 1,208 1,272 (64) -5% South Asia 1,301 1,049 252 24% Canada & South America 303 271 32 12% US 1,132 913 219 24% Europe & Middle East 307 282 25 9% Asia Pacific 125 121 4 3% Total Other 498 428 70 14% Total Group 4,874 4,336 538 13% Indian Rs Crores

  46. Robust Balance Sheet Position Indian Rupees Crores

  47. Performance Over Time In Rs Lacs In Rs 6000 300 4874 4336 5000 250 4005 4000 200 3000 150 2000 100 1000 50 532 436 393 0 0 2006/07 2007/08 2008/09

  48. Significant Increase in Dividend PayoutDividend Quantum Performance 216 Currency:Indian Rupees Lakhs Exceptional Dividend 108 92 124 92 67 56 2004/5 2005/6 2006/7 2007/8 2008/9

  49. Standalone PerformanceTata Tea Ltd Operating incomeUp 20% Optg income of Rs 1379 Crs for the year compared to Rs 1153 Cr in the prior year. Reflective of growth in brands and price increases Operating EBITDown 15% Strong brand performance with recovery of commodity cost increases and lower export profitability, Retiral benefits cost increases driven by market conditions. EBIT at Rs 142 Crs PBT before exceptionalsUp 4% Investment income including dividends from Group companies results in PBT at Rs 239 Crs PBTDown 41% Exceptional expenditure in the current year reduces PBT to Rs 229 crs. PY had profit on sale of North India Plantation Operations

  50. Standalone PerformanceTata Coffee Group Operating incomeUp 21% Operating income of Rs 1121 Crs compared to Rs 925 Crs in the prior year. Strong branded sales in the US coupled with favourable Fx translation and higher plantation sales Operating EBIT Up 1% Strong brand performance offset by investment behind ‘Good Earth’ launch, lower export profitability translates to a growth of 1%. EBIT at Rs 148 Crs PBT before exceptionalsUp 16% Loan restructuring drives lower interest costs results in PBT before Exceptional items at Rs 83 Crs up 16% PBTDown 2% Exceptional expenditure relating to US reorganisation reduces PBT to Rs 70 Crs, down 2%

More Related