Nestlé Waters in the USA

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Nestlé Investor Seminar 2014 June 3 rd & 4 th , Boston Nestlé Waters in North America Tim Brown President & CEO Nestlé Waters North America June 3 rd & 4 th , Liberty Hotel, Boston, USA Nestlé Investor Seminar 2014

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Presentation delivered by Tim Brown, Chairman, President & CFO, Nestlé Waters North America, to the 2014 Nestlé Investor Seminar, Boston USA, 3-4 June

Transcript of Nestlé Waters in the USA

Page 1: Nestlé Waters in the USA

Nestlé Investor Seminar 2014 June 3rd & 4th, Boston

Nestlé Waters in North America

Tim Brown

President & CEO

Nestlé Waters North America

June 3rd & 4th, Liberty Hotel, Boston, USA

Nestlé Investor Seminar

2014

Page 2: Nestlé Waters in the USA

Nestlé Investor Seminar 2014 June 3rd & 4th, Boston

Disclaimer

This presentation contains forward looking statements

which reflect Management’s current views and estimates.

The forward looking statements involve certain risks and

uncertainties that could cause actual results to differ

materially from those contained in the forward looking

statements. Potential risks and uncertainties include such

factors as general economic conditions, foreign exchange

fluctuations, competitive product and pricing pressures and

regulatory developments.

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Page 3: Nestlé Waters in the USA

Nestlé Investor Seminar 2014 June 3rd & 4th, Boston

Ensuring responsible water

management &

Our Vision

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Be the Leading Healthy Hydration

Company by enhancing people’s

quality of life

Page 4: Nestlé Waters in the USA

Nestlé Investor Seminar 2014 June 3rd & 4th, Boston

Nestlé Waters in North America

2013 Sales of $4.0bn, with 4.2% CAGR2011-2013

73%

8%

19%

US Retail Canada Retail Direct/Other

7,700 employees

29 Production Facilities

14 Brands

Contribution of Sales

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Page 5: Nestlé Waters in the USA

Nestlé Investor Seminar 2014 June 3rd & 4th, Boston

A fast growing category led by solid fundamentals

Growing

Population

1

Quality &

Safety

3

Aging

Population

4

Urbanization

2

Healthy

Hydration/

Obesity Issue

5

Taste &

Pleasure for

Myself

6

Convenience

& Portability

7

Caring

for the

Environment

8

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Page 6: Nestlé Waters in the USA

Nestlé Investor Seminar 2014 June 3rd & 4th, Boston

Bottled water the healthy choice vs. CSD…

Bottled Water will continue to overcome CSD’s growth

208 220 240

212 288 391

62 71 83

24 35 47

66 82 98

2007 2012 2017

Others

RTD Tea

Fruit Juice

Bottled Water

Carbonates

Source: Zenith 2012 and Euromonitor 2013

Evolution of Consumption of Non-alcoholic Beverages Worldwide (in billion liters)

+6.3%

+6.3%

CAGR

2007-12

CAGR

2012-17

+1.1%

+6.3%

+2.9%

+7.4%

+4.5%

+1.8%

+3.0%

+3.7%

696bn L 571bn L 859bn L

+ 84% 2017

vs. 2007

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Page 7: Nestlé Waters in the USA

Nestlé Investor Seminar 2014 June 3rd & 4th, Boston

Fighting obesity at the core of the shift

Category 4-Year CAGR +5%

Partnership for Healthy America

Drink UP

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Page 8: Nestlé Waters in the USA

Nestlé Investor Seminar 2014 June 3rd & 4th, Boston

3rd largest US non-alcoholic beverage business

29.8 23.9 11.7 9.4 7.3 0

5

10

15

20

25

30

35

Coca-Cola Pepsi NWNA DPSG Niagara

Lit

ers

(b

n)

Source: Beverage Marketing Corp 2013

Competitor 1

Competitor 2

Competitor 4

Competitor 3

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Page 9: Nestlé Waters in the USA

Nestlé Investor Seminar 2014 June 3rd & 4th, Boston

Nestlé Waters North America – Market share

Source: Beverage Marketing Corp 2013 9

Page 10: Nestlé Waters in the USA

Nestlé Investor Seminar 2014 June 3rd & 4th, Boston

Headwinds and tailwinds in the marketplace

Importance of drinking water and

anti-soft drink sentiments

growing the category

Plastic and litter remain issues

for consumers and stakeholders

Water issues increasing globally

and locally

Opposition bans focused in

parks, cities, universities

Industry reducing plastic and

setting goals for recycling

Industry recognized for role in

times of need

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Page 11: Nestlé Waters in the USA

Nestlé Investor Seminar 2014 June 3rd & 4th, Boston

Create Value For Consumers &

Society

Focus On Profitable Growth

Drive Operational Excellence Across The End-To-End

Value Chain

Foster Lean & Entrepreneurial

Mindset

Ou

r P

rio

riti

es

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Page 12: Nestlé Waters in the USA

Nestlé Investor Seminar 2014 June 3rd & 4th, Boston

NWNA competitive advantages

Incomparable water resources 40 Spring Sites/ 29 Factories

Unique brand portfolio… 6 Regional Water Brands

3 International Brands

2 Nestlé/National Brands

3 Tea Brands

Best-in-Class distribution

and environmental performances

Strong local partners with

great community engagement…

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Page 13: Nestlé Waters in the USA

Nestlé Investor Seminar 2014 June 3rd & 4th, Boston

Convenience Serve Multi Serve Sparkling

Sweetened Enhanced Ready to Drink Tea &

Liquid Enhancers

Nestlé Waters NA competes in multiple segments

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Page 14: Nestlé Waters in the USA

Nestlé Investor Seminar 2014 June 3rd & 4th, Boston

Seizing the sparkling opportunity

S.Pellegrino wins

Oscar with

La Grande Bellezza

And the winner of the

US Perrier Take Home a

Warhol Sweepstakes is

...

Source: Nielsen XAOC+C Database 2013 FY

Capturing CSD Migration

New Occasions

Package & Flavor Innovation

2013 FY NWNA Sparkling Volume Growth: + 7.5% 2013 Volume Share 54.5%

Nestlé Pure Life

Sparkling with

Natural Flavors

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Page 15: Nestlé Waters in the USA

Nestlé Investor Seminar 2014 June 3rd & 4th, Boston

Be the

Leading Healthy Hydration Company

by Enhancing People’s Quality of Life

International

Brands

Flavored

Brands & Tea

Local Brands

Nestlé Pure Life

Healthy Pleasure

Healthy

Indulgence

Active Healthy

Hydration

Premium

Flavor Lovers

Individuals

Family

Brands

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Page 16: Nestlé Waters in the USA

Nestlé Investor Seminar 2014 June 3rd & 4th, Boston

Poland Spring

16

2013 FY Volume Growth

PS Region +5.7%

Source: Nielsen Food Database 2013 FY

Poland Spring is the metro area’s

favorite drink… By Josh Kosman

December 26, 2013

The #1 Beverage Brand in Boston!

The #1 Beverage Brand in New York!

Page 17: Nestlé Waters in the USA

Nestlé Investor Seminar 2014 June 3rd & 4th, Boston

Nestlé Pure Life is #1 bottled water brand in US

Nestlé Pure Life is a Billion Dollar Brand

In more households than any bottled water brand

Top scores out of national bottled water brands for

loyalty (Nielsen Homescan Panel 2013)

Growing volume in Grocery, Hispanic

Grocery, Pharmacy and Convenience Store

Leading families to a healthier lifestyle

Committed to investing in the consumer

Source: Beverage Marketing Corp 2013

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

Ga

llo

ns

(m

)

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Page 18: Nestlé Waters in the USA

Nestlé Investor Seminar 2014 June 3rd & 4th, Boston

Balance high volume base

Balance Core

.5L Case Pack Brand Equity / Innovation

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Page 19: Nestlé Waters in the USA

Nestlé Investor Seminar 2014 June 3rd & 4th, Boston

Flexible route to market

A hybrid approach

NWNA Factory

Large Stores Customer DC Wholesaler 3rd Party Distributor Company Owned

Route

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Page 20: Nestlé Waters in the USA

Nestlé Investor Seminar 2014 June 3rd & 4th, Boston

EASY

Multi-Channel Accessibility

No Membership Required

Choice of Delivery Options

Digitally Enabled

TRUST

Satisfaction Guarantee

Top Beverage Brands

VARIETY

Full Portfolio Featured

GREAT SERVICE

Personalized Communications

At your service driven by consumer demand

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Page 21: Nestlé Waters in the USA

Nestlé Investor Seminar 2014 June 3rd & 4th, Boston

Nestlé Waters and the commitment to environmental responsibility

Sharing our Progress; Engaging with Transparency:

Environmental NGOs

Media

Lawmakers

Community

Employees

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Page 22: Nestlé Waters in the USA

Nestlé Investor Seminar 2014 June 3rd & 4th, Boston

Creating Shared Value through raising awareness of healthy hydration and water stewardship

Healthy Hydration

Partner to build awareness and understanding of the importance

of healthy hydration

Water Stewardship

Ensure sustainable management of our sources; work with others

to improve watersheds and educate about water

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Page 23: Nestlé Waters in the USA

Nestlé Investor Seminar 2014 June 3rd & 4th, Boston

Nestlé Waters North America

Sales (in USD)

+4.2%

2011 2012 2013

Trading Operating Profit (in USD)

+6.9% CAGR(1)

+320 bps(1)

ROIC after goodwill

2011 2012 20132011 2012 2013

(1): 2011 to 2013 change

CAGR(1)

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Page 24: Nestlé Waters in the USA

Nestlé Investor Seminar 2014 June 3rd & 4th, Boston

Growing Category Brand Portfolio Profitable Growth

Route to Market Creating Shared Value

Summary of Nestlé Waters NA

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