2019 ANNUAL REPORT - Coca-Cola Amatil

Transcription

2019ANNUALREPORT

OURBUSINESSCOVID-19 &OUR 2019 REPORTAN IMPORTANT MESSAGETHE VALUEWE CREATEPERFORMANCE & OUTLOOKREADING THIS REPORT IN THE CONTEXT OF COVID-19010204060810404650525457As you will see, we have adopted a new approach toAmatil’s 2019 Annual Report. We have combined ourAnnual and Sustainability Reports for the first time,building on our commitment to move towards integratedreporting, and to showcase the year that was for ourcompany, our people and all of our stakeholders.COVID-19 & Our 2019 ReportWho We AreWhere We Operate2019 HighlightsChairman’s ReviewGroup Managing Director’s ReviewGroup PerformanceAustralian BeveragesNew Zealand & FijiAlcohol & CoffeeIndonesia & Papua New GuineaCorporate & ServicesBEING A SUSTAINABLE BUSINESS12141620242832385861Strategy and Long-term Value CreationOur Shareholder Value PropositionThriving CustomersCommitted PartnersEngaged PeopleDelighted ConsumersBetter EnvironmentStakeholdersSustainability StrategySustainability Goals and ProgressGOVERNANCE & RISKS62646668Corporate GovernanceBoard of DirectorsGroup Leadership TeamBusiness and Sustainability RisksFINANCIAL & STATUTORY REPORTSDirectors’ Report (including Remuneration Report)Financial ReportIndependent Auditor’s ReportOTHER INFORMATION155156159160161Independent Limited Assurance ReportShareholder InformationFive-year Financial HistoryGlossaryDirectories & Calendar of EventsWe have cancelled large gatherings and implementedphysical distancing measures designed to protect our people,whether they work in our field-based sales teams, front-linemanufacturing and distribution operations, or in an officebased environment. We have suspended all internationaland non-essential domestic travel and implementedmeasures to ensure we can equip our teams to workvirtually where possible, and safely in all other situations.Amatil’s Annual General Meeting of Shareholders scheduledfor 26 May 2020 will also be conducted virtually, todiscourage physical attendance for the protection of allour people and our investor community.This Report reflects our results and achievements for2019. The strategies, priorities, shareholder valueproposition and outlook statements were relevant andappropriate at the time of being issued within the 2019Financial and Statutory Reports, but COVID-19 willcause all of them to change.Amatil has a strong balance sheet and low net debt levels,ensuring we are well positioned to navigate this event.We have been implementing contingency plans tomitigate the impacts of COVID-19 on our workforce andoperations. We will continue to evolve our responseand assess the impact of this global pandemic as itseffect on our business becomes clearer.Our latest updates to the market can be found on ourwebsite at www.ccamatil.com.We thank our many customers, brand and businesspartners across all regions for working with us inpartnership to continue to meet the needs of our customersand protect the communities in which we operate.GOVERNANCE& RISKS7099150At Coca-Cola Amatil, protecting the health and safetyof our people and those we work with will always be ouroverriding priority. At the time of finalising this Reportwe are monitoring on a daily basis the status and impactsof COVID-19, to respond and adjust across all of ourgeographies and adapt to new work rhythms andoperations – to remain focused on business continuityand our customers during this challenging time.Given the significant uncertainty around the durationand impacts of the COVID-19 pandemic, on 17 March 2020Amatil withdrew the earnings guidance, which waspreviously issued to the market on 20 February 2020.BEING A SUSTAINABLEBUSINESSTHE VALUE WE CREATEAt the time of publication of this 2019 Annual Report1(“Report”), the world is responding to the COVID-19pandemic and the duration, impacts and severity arecontinuing, with many unknowns.We will continue to align with advice from the WorldHealth Organisation and the relevant GovernmentAuthorities in our countries of operation.PERFORMANCE& OUTLOOKOUR BUSINESSFINANCIAL & STATUTORYREPORTSANNUAL GENERAL MEETING1OTHERINFORMATIONCoca-Cola Amatil’s AGM will be heldvirtually via our online platform athttps://agmlive.link/CCL20on 26 May 2020 at 10.00am (AEST).Print date as at 14 April 2020.ABN 26 004 139 3971

OURBUSINESSWHO WE AREOUR GROUP STRATEGYOur Group strategy is our blueprint for success. It positions us to capture growth and deliver long-term value. We know that ourmarkets will continue to change. We are confident in our ability to adapt and adjust to capitalise on opportunities and addresschallenges as and when they arise. As a Group, we are focused on two overarching objectives – Perform and Grow. The successof both is built on a foundation of a Strong Organisation.OUR PURPOSEPERFORMEVERY DAY WE CREATE MILLIONS OF MOMENTS OF HAPPINESSAND POSSIBILITIESGROWThe Perform objective is guided by our Shareholder Value Proposition and isour primary day-to-day focus. The three strategic pillars within this – Lead,Execute, Partner – were defined as part of our 2014 strategic review and arethe basis on which our businesses structure their plans.We are a strong organisation with a proven ability to adapt and capitaliseon opportunities to further grow our portfolio of brands and businesses.Our growth agenda positions us to deliver long-term sustainable returnsto our Shareholders.LEADOur ambition is to be a Regional Beverages Powerhouse. To achieve this,we are looking to be ‘the leading beverages business in the ASEAN andOceania region’.Strengthen Category Leadership Position– L eading brands in each of our major categories in each market–U p-weighted levels of innovative marketing continually strengthening brand equity– E volving portfolio that adapts to changing consumer preferencesOUR VALUESEXECUTEOur Values are the basis for how we work together and operate. They guide our behavioursand our decisions, every day.WE TAKE THEINITIATIVE ANDOWN THE OUTCOMEWE FOCUSON TODAY ANDTOMORROWOUR AMBITIONOur growth agenda seeks to maximise opportunities and position us todeliver long-term sustainable returns to our Shareholders. We have aclear growth platform that focuses on:GROWTH WITHIN CATEGORIESStep Change in Productivity and In-Market Execution– Innovation with our brand partners and selective Mergers and Acquisitionsin existing and new beverage categories– World-class customer servicing capability– New beverage categories in existing markets– Route-to-market that provides customer diversification and competitiveadvantageGROWTH ACROSS GEOGRAPHIES– E ffective leverage of our large-scale, low-cost manufacturing, sales anddistribution capabilityPARTNER– Entering new geographies in existing beverage categories– Immediate focus on South-East Asia and Oceania based on our currentoperations, future growth prospects and potential for synergiesBetter Alignment with The Coca-Cola Company and Our Other Brand PartnersGROWTH ALONG THE VALUE CHAIN–S hared vision of success and aligned objectives– Vertical integration and extensions of our existing value chain in currentgeographies – increasing the role we play in getting our great beveragesinto the hands of consumers.– J oint plans for growing System profitability–B alanced share of risk and rewardsBEING A SUSTAINABLEBUSINESSWE ARESTRAIGHTFORWARDAND OPENPERFORMANCE& OUTLOOKOur future is shaped by our purpose and our values form the foundation of our culture. Ourpurpose unites all of us and focuses our energy. It reflects the scale of our business and themillions of people we connect with directly and through our products. It’s about what we doevery day and the possibilities we are creating for the future for Shareholders and society.THE VALUEWE CREATECoca-Cola Amatil is one of the largest bottlers and distributors ofnon-alcoholic and alcoholic ready-to-drink beverages in the Asia Pacificregion and one of the world’s larger bottlers of The Coca-Cola Company’srange of products.TO BE A REGIONAL BEVERAGES POWERHOUSESTRONG ORGANISATIONGOVERNANCE& RISKSOur Ambition is to be a Regional Beverages Powerhouse in the Association of SoutheastAsian Nations (ASEAN) and Oceania regions as we look to grow within categories, acrossgeographies and along the beverages value chain. We have a clear growth platform thatbuilds on our expert knowledge of the beverages market in ASEAN and Oceania, ourleading portfolio of brands, and track record of delivering innovation.Our ability to deliver our performance and achieve our growth aspirations is underpinned by a Strong Organisation with strong, accountable businesses,a One Amatil mindset led by the Group Leadership Team and a lean Group centre that safeguards and shapes our future.In 2019 we accelerated the implementation of our Strong Organisation through divestment of the SPC business and announcement of the integration ofAlcohol & Coffee into each of our geographies. This has simplified our manufacturing model, strengthened our customer focus, and improved our emphasison our Beverages Powerhouse ambition.A ONE AMATIL MINDSETWe believe the Group Leadership Team has a shared accountability for a One Amatil mindset so we are making decisions that are in the best interests of Amatil overall.There are many opportunities to share learnings, leverage expertise and share services.FINANCIAL & STATUTORYREPORTSA LEAN GROUP OFFICEAn essential component of our model is a lean Group Office, which provides functional leadership to support our businesses and a One Amatil approach to safeguardingand shaping our future. This ensures we operate in line with the expectations of our Board, realise our ambition of becoming a Regional Beverages Powerhouse and createlong-term value for Shareholders and for society.OUR LONG-TERM VALUE PROPOSITIONOTHERINFORMATIONIn 2019 we redefined our approach to the creation of long-term value. I t is a new way of thinking about how we create long-term,sustainable value that integrates our previous sustainability framework with our Shareholder value proposition. We believecreating value for society is completely integrated and consistent with the way we deliver value to Shareholders. This meansthat as we pursue growth, we do so through the lens of seeking positive impacts for our people, customers, partners, consumers,the environment and our community.We will continue to think about how we measure our performance against this model and refine our performance indicatorsso that our Shareholders and stakeholders can hold us accountable as we fulfil our strategic ambition of being a RegionalBeverages Powerhouse.2COCA-COLA AMATIL ANNUAL REPORT 20193

Papua New 013,10043001324,500INDONESIAOURBUSINESSWHERE WEOPERATEIndonesiaFijiSAMOAWith access to more than 270 million potential consumers through more than630,000 active customers, our product range includes sparkling beverages,water, sports, energy, fruit juices, iced tea, flavoured milk, coffee, kombucha,beer, cider and spirits.AUSTRALIAFIJIBEING A SUSTAINABLEBUSINESSWe are committed to leading through innovation, and to building a sustainablefuture, capturing growth and delivering long-term value to our Shareholders.PERFORMANCE& OUTLOOKAs both brand partner and brand owner, we operate acrosssix countries – Australia, New Zealand, Indonesia, PapuaNew Guinea, Fiji and Samoa – to prepare, distribute andsell an unrivalled range of beverages. With decades ofexperience, we do this safely and responsibly, and are proudthat our products delight millions of people every day.THE VALUEWE CREATEPAPUA NEWGUINEAWe employ around 12,000 people and create thousands more jobs in thecommunities in which we operate. Across this team we work as one, unitedby a shared purpose and common values. We know that our diverse workforceis our greatest strength and makes us the vibrant company we are today.New ZealandKeyProduction FacilitiesCustomersProduction 032438,500GOVERNANCE& RISKSAustralia110,000323,4003011125,300NEW ZEALANDFINANCIAL & STATUTORYREPORTS9Alcohol & Coffee183,050197,100OTHERINFORMATION1075770321 Includes all Alcohol & Coffee operations across Australia, New Zealand, Fiji, Samoa and Indonesia,and excludes shared facilities with other Amatil businesses.2 Includes all brands distributed by Amatil both as brand owner and brand partner, including thosedistributed under agreement with Beam Suntory, Molson Coors & Chilli Marketing.3 Including contractors.4COCA-COLA AMATIL ANNUAL REPORT 20195

2019HIGHLIGHTSTHE VALUEWE CREATESUSTAINABILITYONGOING GROUP REVENUEAUSTRALIAN BEVERAGESachieved revenue growthfor the first time since 2012STATUTORY NPAT 374.4m34.2%NEW ZEALAND & FIJI7.3% 10.1%REVENUEEBITWATER INTENSITYcompleted our Human Rights Policytraining programtarget maintained fornon-alcoholic beverages84.8%WASTE COLLECTIONPOSITIONS HELD BY WOMEN38% 43% 21%BoardSeniorExecutiveManagementExcellent all-round performance 603.4m31.9%INDONESIA & PAPUA NEW GUINEAdelivered double-digit revenueand volume growth. Indonesiaachieved high single digit revenueand volume growth despite flatoverall NARTD market.51.7cALCOHOL & COFFEEachieved the fifth consecutiveyear of double-digit EBIT growth34.3%FINAL ORDINARY DIVIDENDper share6COCA-COLA AMATIL ANNUAL REPORT 2019PACKAGING IN AUSTRALIA7/10RENEWABLE AND LOW-CARBON ENERGYof our plastic bottles in Australia are nowbeing made from 100% recycled plasticused in our manufacturing operationsPACKAGING IN NEW ZEALANDCOMMUNITY PROGRAMSnow used in all single-servecarbonated soft-drink bottles andall water bottles in New Zealandin community investment,0.81% of ongoing EBIT100% rPET53.3%A 5.2mMORE THANSUSTAINABILITY TARGETSachieved strong progress80%of supplier spend screened usingresponsible sourcing criteriaCLIMATE CHANGEOTHERINFORMATION26.0cBali Beach Clean Up has collected over40,000 tonnes of waste over 12 yearsFINANCIAL & STATUTORYREPORTSSTATUTORY EPS40k tonnesGOVERNANCE& RISKSSTATUTORY EBIT1.95 L/LBEI

FINANCIAL STATUTOR REPORTS OTHER INFORMATION OUR BUSINESS. 1. ANNUAL GENERAL MEETING. Coca-Cola Amatil’s AGM will be held . virtually via our online platform at https://agmlive.link/CCL20 on 26 May 2020 at 10.00am (AEST). ABN 26 004 139 397. OUR BUSINESS . 01 . COVID-19 & Our 2019 Report. 02. Who We Are. 04 . Where We Operate. 06 . 2019 Highlights. 08