1 INVESTOR PRESENTATION Investor Presentation.pdf · This presentation includes forward-looking...
64
1 PUBLIC PUBLIC INVESTOR PRESENTATION June 2020
Transcript of 1 INVESTOR PRESENTATION Investor Presentation.pdf · This presentation includes forward-looking...
1
PUBLICPUBLIC
INVESTOR PRESENTATIONJune 2020
2
PUBLICPUBLIC
This presentation includes forward-looking statements including, but not limited to, statements regarding Coca-Cola
İçecek’s (“CCI”) plans, objectives, expectations and intentions and other statements that are not historical facts.
Forward-looking statements can generally be identified by the use of words such as “may,” “will,” “expect,” “intend,”
“estimate,” “anticipate,” “plan,” “target,” “believe” or other words of similar meaning. These forward-looking
statements reflect the current views and assumptions of management and are inherently subject to significant
business, economic and other risks and uncertainties. Although management believes the expectations reflected in
the forward-looking statements are reasonable, at this time, you should not place undue reliance on such forward-
looking statements. Important factors that could cause actual results to differ materially from CCI’s expectations
include, without limitation: changes in CCI’s relationship with The Coca-Cola Company and its exercise of its rights
under our bottler's agreements; CCI’s ability to maintain and improve its competitive position in its markets; CCI’s
ability to obtain raw materials and packaging materials at reasonable prices; changes in CCI’s relationship with its
significant shareholders; the level of demand for its products in its markets; fluctuations in the value of the Turkish
Lira or the level of inflation in Turkey; other changes in the political or economic environment in Turkey or CCI’s other
markets; adverse weather conditions during the summer months; changes in the level of tourism in Turkey; CCI’s
ability to successfully implement its strategy; and other factors. Should any of these risks and uncertainties
materialize, or should any of management’s underlying assumptions prove to be incorrect, CCI’s actual results from
operations or financial conditions could differ materially from those described herein as anticipated, believed,
estimated or expected. Forward-looking statements speak only as of this date and CCI has no obligation to update
those statements to reflect changes that may occur after that date.
2
3
PUBLICPUBLIC
AGENDA
Overview of CCI
1Q20 Performance
Strategic Priorities & COVID-19
Financial Highlights
Sustainability
Appendix
4
PUBLICPUBLIC
Overview of CCI
5
PUBLICPUBLIC
DISCIPLINED FINANCIAL
MANAGEMENT
deliver stakeholder value
STRONG SYSTEM ALIGNMENT
relationship with TCCC
PROVEN TRACK RECORD
expansion & growth in
emerging markets
STRATEGY, EXECUTION,
PEOPLE
accelerate quality growth
ABUNDANT POTENTIAL
demographics
PRESENCE IN LARGE &
GROWING MARKETS
NARTD* growth opportunity
*Non-alcohol ready-to-drink5
6
PUBLICPUBLIC
10 countries, ~400 mn people
26 production plants with 126 lines
1.5 bn UC(1) annual production capacity
~780 thousand sales points
1.3 bn UC sales volume
$ 2.2 bn revenue & $ 403 mn EBITDA
KAZAKHSTAN
KYRGYZSTAN
TAJIKISTAN
AZERBAIJAN
TURKEY
IRAQ
JORDAN
SYRIA
Figures reflect FY19 numbers unless otherwise stated
(1) Unit case, 1 UC equals 5,678 liters
Volume Breakdown
Revenue Breakdown
EBITDA Breakdown
7%8%
23%
11%
50%
TURKEY
KAZAKHSTAN
PAKISTAN
IRAQ
OTHERS
#1
#1
#2
#2
Sparkling Market Position
20%
18%
15%
47%
TURKEY
KAZAKHSTAN
PAKISTAN
OTHERS
53% 47%TURKEY
INTERNATIONAL
1
6
7
PUBLICPUBLIC
Single country in
2005…
Expanding into Central Asia and
North Iraq in 2006-2007…
JV in Pakistan in
2008...
A regional bottler
today…
318 mn UC 1,316 mn UC
South Iraq in
2012…
11% 18%CAGR 2005-2019CAGR 2005-2019
19%CAGR 2005-2019
4x 10x 12x
7
8
PUBLICPUBLIC
Maintaining Quality Growth
13%
4%6%
0%
18%
21%
27%
15%17%
26%
36%
19%
CAGR (2005-16) 2017 2018* 2019
Volume NSR EBITDA
2019: Continuation of quality growth algorithm
Solid Free Cash Flow
2019: Record High free cash flow
-
642729 727
1.079
Cumulative2005-2015
2016 2017 2018 2019
TL millionGrowth
*Includes TFRS 15 adjustments8
9
PUBLICPUBLIC
Right Price
Regional Strategies
Effective discount and
trade promotion
management
NSR > PCE growth
Right Mix
IC Portfolio Availability
Optimum price/pack
architecture
IC Share ↑6 pts in Turkey
(2019 vs 2014 YE)
Right Portfolio
Portfolio expansion
Portfolio innovation
Portfolio diversification
Right Channel
Channel prioritization
Clear channel roles &
objectives
Segmented execution
Covid-19 Initiatives
Optimization of SKUs
Adapting to sharp decline on IC share, on-premise
channel
New marketing strategies favoring Future / Home
Consumption
New price adjustments
9
10
PUBLICPUBLIC
Outlet Coverage(as of ’19)
Time in Field*(as of ’19)
Call Completion Rate**(as of ’19)
Strike Rate***(as of ’19)
*Time in Field: Percentage of time spent on the field vs. total working hours
**Call Completion Rate: Percentage of realized visits vs. planned
***Strike Rate: Percentage of invoiced customers vs. planned
95%
90% 65%
72% Over 1 million coolers
~146K new placements in 4 years (as of YE19)
Superior Execution: Be Available, Be Cold,
Be Visible
10
11
PUBLICPUBLIC
1Q20 Highlights
12
PUBLICPUBLIC
Volume growth due to sudden slowdown in March, despite high teens volume growth in the first 2
months
Contraction in number of transactions mainly due to shutdown of on-premise channel in most
markets by March
Net Sales Revenue (NSR) growth and 15.8% FX neutral NSR growth due to price adjustments
and despite negative mix
EBITDA growth leading to 41 bps margin expansion despite termination of cash designation and
negative mix
FCF generation despite the challenging environment in March
Sharp declines in on-premise channel, capacity utilization at 60% levels, severe SKU
optimization and change in consumer habits, some of which may be permanent
12
13
PUBLICPUBLIC
Balanced price adjustments, positive product and channel mix contributed to another year of quality
growth despite challenges in our geographies
EBITDA NET SALES REVENUE VOLUME
10,623
12,245
NSR
2018 2019
1,9192,283
EBITDA
2018 2019
Volume 0.1%
1,315 1,316
Volume
2018 2019
9,550 9,804
Transactions
2018 2019
Transactions 2.7% NSR 15.3% EBITDA 19.0%
13
14
PUBLICPUBLIC
Price adjustments, strict opex management contributed to another quarter of quality growth despite
decline in number of transactions due to on-premise channel impact
2,1742,622
NSR
1Q19 1Q20
320
397
EBITDA
1Q19 1Q20
Volume 3.8%
230239
Volume
1Q19 1Q20
1,847 1,832
Transactions
1Q19 1Q20
Transactions (0.8)% NSR 20.6% EBITDA 23.9%
EBITDA NET SALES REVENUE VOLUME
Numbers exclude NRTD tea 14
15
PUBLICPUBLIC
77%
8%
15%
SPARKLING 1Q20: 5.7%
Growth in all markets except Jordan & Turkmenistan
Promising market share gains in Pakistan and Iraq
STILLS 1Q20: 0.9%
Cycling 14.1% growth in 1Q19
Ice Tea growth in all markets except Turkey
Double digit growth in juice in Central Asia
WATER 1Q20: 3.5%
Cycling 6,3% growth in 1Q19
Continued growth in IC packages
15
16
PUBLICPUBLIC
TURKEY INTERNATIONAL PAKISTAN KAZAKHSTAN IRAQGrowth YoY
1Q19
2019
1Q20
-1.5%
1.8%
0.3%
-2.1%
-1.5%
6.6%
Share in Total Volume (1Q20)
45%
55%Turkey International
-8.2%
-7.8%
6.5%
19.1%
13.9%
15.2%
-4.0%
0.8%
-8.6%
24% 16% 8%
16
17
PUBLICPUBLIC
Strong sparkling growth led to positive category mix
Decrease in the on-premise channel due to Covid-19
Successful market execution
Successful pricing initiatives
Quality growth momentum disrupted due to
Covid-19 related mix changes
#1 share in Sparkling*EBITDA excluding other operating income/expense
0.3%
18%
-23%
4%
VOLUME NSR EBITDA*excl. Cash
Designation
EBITDA*
412 bps margin impact
of cash designation in
1Q19
1Q20 YoY Growth (%)
+4% -7%mainly due to
weaker juice
category
-6%mainly due to our
focus on more
profitable packs
17
18
PUBLICPUBLIC
Growth in all Central Asian markets except Turkmenistan
Continued sparkling share gains in both Pakistan and Iraq
Market price adjustments and lower prices in some raw
materials led to Gross and EBITDA margin expansion
#1 KZ & AZ, #2 PK & IQ Sparkling Markets
6,5% volume growth in Pakistan
*EBITDA excluding other operating income/expense
7%
22%
64%
VOLUME NSR EBITDA*
1Q20 YoY Growth (%)
Coca-Cola TM grew over the average sparkling growth in
every CA country (except Turkmenistan)
+7% +17%with strong
growth in juice
and ice tea
+1%mainly due to our
focus on more
profitable packs
on the back of
double digit growth
of TM Coca-Cola
18
19
PUBLICPUBLIC
32%31%
68% 69%
First 10 weeksof 1Q19
First 10 weeksof 1Q20
IC FC
170
197
TransactionsFirst 10 weeks of 1Q19
First 10 weeks of 1Q20
Volume up by 16% No significant mix change
Pre-COVID19
28%19%
72% 81%
Last 2 weeks of1Q19
Last 2 weeks of1Q20
IC FC
60
41
TransactionsLast 2 weeks of 1Q19
Last 2 weeks of 1Q20
Volume down by 31% Negative mix change
Post-COVID19
Figures reflect sell-in numbers & excluding NRTD tea
Decline in on-premise channel is offset somewhat by the growth in the discounter segment
19
20
PUBLICPUBLIC
Strategic Priorities&
COVID-19
21
PUBLICPUBLIC
Our Vision Values
21
22
PUBLICPUBLIC
ONE CCI
Full-beverage portfolio
Revenue Growth
Management (RGM)
Expand Sparkling & Stills
Increase frequency
Regional strategies
Accelerate Growth
Win at the
Point of Sale
Increase outlet coverage
Increase cooler penetration
Right Execution Daily
E-commerce
Future-proof RTM
Exercise Financial Discipline
Productivity savings
Working capital improvements
Healthy FCF
Optimum leverage
Effective FX management
Win withPeople
Integrated Talent Strategy
Leadership Development
High Performing Team
Transformation to “OnePeople”
22
23
PUBLICPUBLIC
Sustain Quality Growth
Prudent capex & opex
spending, DMEs frozen for 2Q
Solid balance sheet and strong
liquidity buffers
Deliver Free Cash Flow
Dynamic forecasts and
scenarios
Risk mitigation strategies (WC
improvements)
Strong counterparty risk
management
PRESERVING
FINANCIAL HEALTHPROTECTING
OUR PEOPLE
Remote working
Safety
precautions
Commitment for
job safety
Fast adaption
ADAPTABILITY TO
CHANGING CONSUMER
HABITS
On-premise shutdowns
Growth in the discounters
segment
Shift towards online
channels
$3.3 million cash donation
Product donations to
health institutions &
people in need
10.4 tons of disinfectants
produced in our plants
to be donated to health
ministries
Donations through Coca-
Cola Foundation
SUPPORTING
OUR COMMUNITIES
SUPPLY CHAIN
& PRODUCTION
No significant issue on
procurement (Co2 in Iraq)
Non-stop production in all
operations
Operational sales teams
Benefit from beverage
industry priveleges
(permits during curfews,
hiring dormitories)
Over 75% of main raw
materials have already
been hedged for 2020
(even partially hedged for
2021)
Optimized SKUs
23
24
PUBLICPUBLIC
11%
12%
51%
30%
WATER
STILLS
SPARKLING
NARTD
CCI Value Share Opportunity
INDUSTRY VALUE
GROWTH
Source: Nielsen, Canadean and internal estimates, data as of 2019
TOTAL NARTD INDUSTRY IN CCI COUNTRIES: $14.7BN (2019)
24
25
PUBLICPUBLIC
59%
51%
41%
36%
27%25%
AsiaPacific
NorthAmerica
WorldAverage
Europe,Middle
East andAfrica
LatinAmerica
CCI
Teen Recruitment Opportunity!
1Based on CCI analysis for Turkey operations
Share of Immediate Consumption (IC)
Packages in Sparkling
~2x higher
NSR per case1
~1.5x higher
Gross Marginvs. FC1
25
26
PUBLICPUBLIC
Source: TCCC and Canadean Estimates
* NARTD includes sparkling soft drinks, ready-to-drink tea, energy drinks, juices, packaged water
*NARTD per cap per year in terms of number of 8 ounce servings
** as of 2018
1.481
1.319
1.226
1.0661.0441.0141.000
955 944 942
867
794 793 791779 734 718 695
646 643 639
539 535 531 513 493 471 466
394 382 363 355325 321 313 292 276 255 232 213 204
124 124 11685 82 70
CCI's Share NARTD
CCI average: 257
NARTD per cap*
26
27
PUBLICPUBLIC
Category Breakdown
Sparkling 71%
Sparkling 85%
Water
14%
NRTD
Tea 8%
Still 7%
Other
15%
2006
2019
Share of Low/No Calorie in Sparkling
Volume (2019)
27%
18%
8%6%
9%7%
4% 3% 2% 2% 1% 0,3%
Nort
h A
merica
EM
EA
Latin A
merica
Asia
Pa
sific
Ta
jikis
tan
Tu
rkey
Azerb
aija
n
Jord
an
Kazakhsta
n
Kyrg
yzsta
n
Ira
q
Pakis
tan
Increasing Household
Penetration &Double-digit growth in
No Sugar
27
28
PUBLICPUBLIC
Volume Breakdown
Guiding principles for geographical expansion
Management control & full consolidation rights
Reasonable proximity
Complementary market dynamics
ROIC > WACC
Turkey50%
Pakistan23%
Kazakhstan11%
Iraq 8%
Others7%
2019
Turkey 81%
International 19%
2006Healthier
Diversification
28
29
PUBLICPUBLIC
Financial Review
30
PUBLICPUBLIC
Consolidated (TL million) 2019 Change* 1Q20 Change**
Net Sales 12,245 15.3% 2,622 20.6%
Gross Profit 4,207 19.3% 847 22.2%
EBIT 1,521 19.9% 182 29.9%
EBITDA 2,283 19.0% 397 23.9%
Profit / (Loss) Before Tax 1,212 135.1% 156 571.6%
Net Income/(Loss) 966 200.7% 127 4,996%
GP Margin 34.4% 1.2pp 32.3% 0.4pp
EBIT Margin 12.4% 0.5pp 6.9% 0.5pp
EBITDA Margin 18.6% 0.6pp 15.1% 0.4pp
EPS*** 3.80 200.7% 0.00499 5,090%
30
EBIT per UC
8,08
10,55
9,46
10,55
2018 2019 1Q19 1Q20
2,683,11 3,01
3,42
2018 2019 1Q19 1Q20
0,961,13
0,610,72
2018 2019 1Q19 1Q20
Consolidated (TRY), FX-Neutral
Net Revenue per UC Gross Profit per UC
11.8%
yoy
11.6%
yoy
13.3%
yoy18.9%
yoy
16.0%
yoy
16.8%
yoy
31
32
PUBLICPUBLIC
Reported Margins
6,9%
15,1%
32,3%
EBIT EBITDA Gross
Profit
▲2.3 pp*
*without cash designation
Margin recovery achieved due to strong margin
expansion of international operations:
lower raw materials
higher selling prices
strong topline volume growth.
▲0.4 pp
▲2.2 pp*
▲0.4 pp
▲2.3 pp*
▲0.5 pp
1Q20
12,4%
18,6%
34,4%
▲0.7 pp*
▲1.2 pp
▲0.1 pp*
▲0.6 pp
▲0.5 pp
2019
EBIT EBITDA Gross
Profit
0.0 pp*
32
9%(3)50%45%(2)
(1) As of April 2020
(2) For non-regulated markets. Iraq, Turkmenistan and Jordan are non-regulated markets. As sugar market is regulated in other countries there is no hedging opportunity through
Ldn#5. Turkmenistan sugar contracts are excluded.
(3) Hedging through contracting with suppliers.
World Sugar Prices
(London#5 Average,
USD/tonne)
220
260
300
340
2019 2020 2021Forward
1500
1600
1700
1800
1900
2000
2019 2020 2021Forward
0
200
400
600
800
1000
1200
2019 2020 2021Forward
100%(2)
Hedged Position
for 2020(1)
LME Aluminium Prices
(Average, USD/tonne)
77%
Resin Prices
(Average, USD/tonne)
75%(3)
Managing FX exposure
related to raw materials...
Terminated Cash
designation as of 2019 YE
Using financial derivative
instruments more effectively
Fixing the prices with
suppliers to the extent
possible
Hedged Position
for 2020(1)
Hedged Position
for 2020(1)
for 2021(1) for 2021(1) for 2021(1)
33
34
PUBLICPUBLIC
1.5
1.1 1,1
2018 2019 1Q20
9,011,6
9,0
2018 2019 1Q20
1Annualized sales
Net Debt
(USD mn)
Net Debt / EBITDA Net Interest Coverage
531
431 416
2018 2019 1Q20
Covenant
> 4x
Continued deleveraging FX-Neutral: ~1.0x Increasing EBIT
Lower net interest expense
Covenant
< 3.25x
34
35
PUBLICPUBLIC
1Depreciation and amortization, including right-of-use asset amortizationTotals may not foot due to rounding differences
127
1
35
36
PUBLICPUBLIC
1,7x1,1x 1,1x
Net Debt/EBITDA
24
564
431 416
1Q19 FY19 1Q20
Managable repayment schedule with 3.2 years average maturity
Balance sheet FX exposure is mitigated by large FX cash balances and hedges in place
Low leverage provides flexibility to debt management
US
Dm
illio
n
FX debt and FX cash are on a consolidated basis. The net FX position in individual countries may differ.
Numbers do not include IFRS lease figures
Net Debt ($m) FX Position on Balance Sheet
36
37
PUBLICPUBLIC
Low gearing ratio at 1.1x
$ 1 bn available credit lines*
Strong access to debt capital markets
CCI’24 trading at Sovereign – 200 bps
Release of $150 mio excess cash due to cancellation of cash
designation
Significant headroom under financial covenants
Net Debt/EBITDA < 3.25
Interest Cover > 4.0
No major refinancing need until 2023
*uncommitted lines in line with the practice in Turkey
EUR
5%
TRY
19%
OTHERS
11%
USD
66%
$467m
eq.
Cash
Breakdown of Consolidated Cash
2020 2021 2022 2023 2024
Maturity Profile
54%
17%
2%7%
20%**
$849m
eq.
Debt*HEDGED**
50%
TRY 6%
USD 28%
EUR 14% PKR 2%
Breakdown of Consolidated Debt
*excluding IFRS 16
**Cross Currency Hedge and Net Investment Hedge
** $80 mio is paid as of
May, 2020 from cash
37
38
PUBLICPUBLIC
2019
9 Days
2017
15 Days
Cash Conversion
Cycle2016
26 Days2018
12 Days
7,4%
5,7%4,5% 4,3%
3,7%
2016 2017 2018 2019 1Q20
4%
27 Days2018 48 Days 64 Days
DSO DSI DPO
30 Days2016 47 Days 51 Days
29 Days2017 43 Days 57 Days
*Net Sales Revenue
Full Year
Net Working Capital/NSR*
27 Days 50 Days 68 Days2019
38
39
PUBLICPUBLIC
7,3%5,9%
8,1%6,3%
2016 2017 2018 2019
6.9%
on
average
Full Year
TL766 million CapEx in 2019
62% related to International operations
38% related to International operations
*Net Sales Revenue
CapEx / NSR*
39
40
PUBLICPUBLIC
EBITDA Growth
Prudent CapEx
Working Capital
Efficiency
*Free cash flow yield based on year-end market capitalization
Free Cash Flow and Yield*
-4410 46
642729 727
1079
-0,3%0,1% 0,5%
7,6%8,2%
9,3%
11,0%
2013 2014 2015 2016 2017 2018 2019
FCF (TLmn) FCF Yield
40
41
PUBLICPUBLIC
Organic Growth
CapEx/Sales ~6.3% (2019)
•Capacity Expansion
•Cold drink equipment
•Maintenance
Optimum CapEx
Allocation
Inorganic Growth
Bolt-on acquisitions
Geographical expansion
•Strategic fit
•Value creation
•Reasonable proximity
Selective M&A
Strategy
Deleveraging
Optimum debt repayment
•Solid balance sheet
•Improving leverage
metrics
Debt Repayment
Shareholder Return
Sustainable dividend
policy
•Increasing payout ratio
•Higher dividend yield
Dividends
41
42
PUBLICPUBLIC
0,120,2
0,79
1,18
0,94
2015 2016 2017 2018 2019
* Amendment was made to the initial proposal of TL 450 mn due to the mandatory provision of
Article 12 of Law on Mitigating of Effects of Coronavirus (COVID-19) Outbreak on Economic and
Social Life and the Law on Amendment of Certain Laws (the Law), dated 17.04.2020 and
numbered 7244. If there was no amendment, dividend amount would be TL 450 mn and dividend
yield 4%.
Dividend per Share (TL per 100 shares)
Dividend
Yield:
0.3%
Dividend
Yield:
0.5%
Dividend
Yield:
2.1%
Dividend
Yield:
4.3%
Dividend
Yield:
2.1%
2019 dividend paid in 2020 is TL 239mn*
Dividend amount based on:
Net distributable income
Free cash flow generation
CapEx and other funding needs for growth
Prevailing macroeconomic conditions
42
43
PUBLICPUBLIC
Withdrawal of 2020 Guidance due to Covid-19 environment
No New Guidance due to uncertainty of Covid-19 duration and its further impacts
Proactive adaptation to any necessary changes and close monitoring of every
development accordingly
Further information to be shared based on any sustainable improvement on our business
environment
43
44
PUBLICPUBLIC
Sustainability
45
PUBLICPUBLIC
Note: AG Anadolu Grubu Holding A.Ş. is the ultimate controlling party of CCI. AG Anadolu Grubu Holding A.Ş. holds 43% and Anheuser Busch InBev SA/NV holds
24% of Anadolu Efes’ share capital. TCCC holds 20.1% of CCI’s outstanding share capital (through TCCEC).
* Özgörkey Holding A.Ş. shares with a nominal value of TL 1.578.000 has been listed to Central Registry Agency, with a sale purpose (December 31, 2019 - TL
1.578.000).
50,3%
27,8%
1,9%
20,1%
Anadolu Efes Biracılık ve Malt Sanayi AŞ
(& its Subsidiaries)
Free Float and Other
Özgörkey Holding AŞ
The Coca-Cola Export Corporation
("TCCEC")
12 Members
12 of whom are non-executive
4 of whom are independent
Compositon of BoD
45
46
PUBLICPUBLIC
2002
1st
Environmental
Policy
2009Signatory to
the United
Nations
Global
Compact
(UNGC)
1st
Sustainability
Report
published.
2010
Announcement
of “2020 Vision
and Strategic
Framework”
20111st independent
external
assurance for
ISAE 3000
Charter member
of the Climate
Change Leaders
Group
Turkey’s 1st F&B
company
in CDP Global
Disclosure
Leaders
2012
Top 2 in Turkey’s
CDP
Carbon Performance
Leaders
“Top 10 Energy-
Saving Challenge
Program” of
TCCC & WWF
İzmir & Mersin plants
20131st & only company from Turkey
and within TCCS in the UNGC 100
Index
New “Code of Ethics”, “Workplace
Rights Policy” and “Ethics Service”
Among Carbon Disclosure and
Performance Leaders in CDP
Turkey 100
CCI Turkey received “Gender
Equality Certification” from
KAGIDER
2014
1st and only
company from
Turkey in the CDP
Global Water
Program
2015Joined the “BIST 50
Sustainability Index”
Joined the “Euronext
Vigeo Emerging 70 Index”
Signatory to the “UN
Women’s
Empowerment Principles”
2016
Joined the “BIST 100
Sustainability Index”
Joined “MSCI Global
Sustainability Index”
Joined “FTSE4Good
Emerging Index”
Among “Turkey’s CDP
Climate Change Leaders”
2017Joined the “ECPI
Emerging
Markets ESG Equity
index”
Joined the “Vigeo
Eiris Best Emerging
Markets Performers
Ranking”
2018
“Workplace Rights
Policy” updated as
“Human Rights Policy”
46
47
PUBLICPUBLIC
Risk Detection
Committee
Risk Detection
Committee
Risk Detection
Committee
Sustainable Operations
Steering Committee
Health & Safety
Steering Committee
Diversity & Inclusion
Advisory Board
Ethics & Compliance
Committee
Risk Detection
CommitteeAudit Committee
Executive Committee
Emissions
Reduction
Work Group
Water
Stewardship
Work Group
Sustainable
Packaging
Work Group
Group H&S
Committees
Location
Based
H&S
Committees
Culture Gender GenerationGroup Ethics
Committees
Location
Based
Ethics
Committees
Corporate Governance
Committee
47
48
PUBLICPUBLIC 48
49
PUBLICPUBLIC
ENERGY MANAGEMENT & CLIMATE PROTECTION
Production Transport & Distribution Cooling Practices
0,26
0,36
0,45
0,35 0,36
0,46
With our Energy Management
Device (EMD) equipped cold drink
equipments, we saved
approximately 511.5
million kWh electricity and
achieved 86,550 tons of
CO2 emissions reduction
in 6 countries since 2009
Core Energy Usage Ratio (MJ/L)
(2018)
We are
able to reduce
energy
consumption by
42% with EMD
equipped
coolers
“Route Optimization Project”
Road Net program reduced
mileage travelled by
1.35 million kilometers,
leading approximately to 1,400tons of less GHG emissions and a
fuel savings of $650K every
year since 2016
TCCC
Average:
0.39 MJ/L
225k tons of CO2 emissions reductions in 6 countries, equaling to the amount 18.5 million trees can annually extract
Logistics improvements Cooler emission reductions Smarter use of technology
Returnable glass bottles practices Pallet re-use practices
49
50
PUBLICPUBLIC
REPLENISHREDUCE
Over 1 Million m3 of saving in 6
countries of operation over the last
3 years
1,55 1,52 1,541,64
2,05
1,64
Turkey Jordan Kazakhstan Azerbaijan Pakistan Kyrgyzstan
TCCC
Average:
1.89 L/LWater Usage Ratio (L/L)
REUSE
We recycle and reuse
691,025 m3 of the water in
our production processes
46
153
477537
691
2014 2015 2016 2017 2018
Recycled and Reused Water (000 m3)
We replenished
11 bn liters* of water, equaling
4,400 olympic swimming pools
6.7 bn liters of
water saving on
50 mn m2 of
agricultural land
*Reflecting 6 countries of operation within
the scope of Sustainability Report
Life Plus Environment Program:
Agriculture of the Future Project
Harran Night Irrigation Project
50
51
PUBLICPUBLIC
REDUCEPET and Glass Lightweight
REUSEReturnable Glass Bottles
RENEWr-PET (Recycled PET)
RECYCLEPost-Consumer Material
Collection
Implementing lightweight
programs since 2010 in
Turkey, Kazakhstan,
Azerbaijan and Kyrgyzstan
1,111 tons of resin and
2,532 tons of glass were
saved with our lightweight
practices in 2018
2.5 lt Fanta 2.5 lt Coca-Cola
1 lt Coca-Cola & Fanta
1.5 lt Coca-Cola & Fanta
2008 2018
Reduction by Lightweight
Implementations (Turkey)
-8.3%-4.8% -5.6% -3.3%
Glass bottles can be used up
to 8 times
In 2018,
388,457 tonsof CO2e was avoided via
returnable glass bottle
practices
This equals to the amount
absorbed by 32.4 milliontrees
Tests started in 2018
3 phases of testing
completed at all plants in
Turkey
Planning to increase
current r-PET ratio of c.6%
Working to develop and
increase r-PET supplier
capacity in CCI countries
Cross-functional
Recycling Task Force
established in Turkey and
Central Asia
Teaming up with TCCC, local
communities, NGOs, industry
peers and consumers
Authorized business partner,
Çevko (Green Dot) Foundation
37% 38% 40% 42% 44%48%
52% 54% 56%
2010 2011 2012 2013 2014 2015 2016 2017 2018
Post-consumer packaging recycling
rate by years (Turkey)
51
52
PUBLICPUBLIC
WOMEN EMPOWERMENT
We have been a signatory to the Women’s
Empowerment Principles (WEP) since March 15
The
Coca-Cola
Belestery
Program
providing microfinance opportunities
to disadvantaged women in Pakistan
The
Zarya
Project
trained 2,000 women in Kazakhstan to improve
their business skills
My Sister
Programtrained over 10,000 women
and 500 refugees in Turkey
UNDP
Women’s
Empowerment
Program
trained 1,300 women in Azerbaijan since 2017
YOUTH EMPOWERMENT
We reached almost 350,000 young
people with our projects in 2018~60% of the
population
in CCI
geography
is below 30
years of age
The Olympic
Moves Program
100,000 youngsters,
4 cities, 4 branches in Azerbaijan
Schools
Renovation
Project
5 schools in Hilla, Iraq with more than
5,000 students were renovated
200,000 children
from 7,800 schools
Coca-Cola
Football
Tournaments(Kazakhstan, Azerbaijan, Iraq)
3.2.1 Move!(Turkey, Kazakhstan)
Award-winning program,
fostering students’ physical and
personal development through
sports and group activities
131*public schools
over 125K*youngsters
*2018, Turkey 52
53
PUBLICPUBLIC
WATER STEWARDSHIP
We attach particular importance
to water related issues
Clean
Irrigation
Canal
A canal of 9 kilometers long that can irrigate
about 3,000 acres was constructed in Hilla, Iraq
Paani
Safe Water
Initiative
44%* of the total population in Pakistan
has no access to safe drinking water; 33%**of deaths are due to water borne diseases
*Pakistan Council of Research in Water Resources (PCRWR)
**Pakistan’s Waters at Risk Report
Launched in 2015, Paani Initiative provided
clean water to more than 900,000 people
with 25 plants across Pakistan
WASTE MANAGEMENT
Temiz Olkem project (Azerbaijan)
Raising awareness on plastic collection
Focus
on water
stress
areas
Increasing recycling rates and
transition to a circular economy is a priority
focus area
Pakistan Without Waste
Aims to address plastic pollution in Pakistan, in collaboration
with WWF-Pakistan and ECO*
*Environmental Consultancies &Options
‘Kollekt’ recycling application
In collaboration with Coca-Cola Turkey
Sourcewater Vulnerability Assessment (SVA)
and Sourcewater Protection Plan (SWPP)
conducted by 3rd party firms for each plant
Measures
for Water
scarcity
53
54
PUBLICPUBLIC
OFFERING MORE CHOICES
Well-diversified product portfolio
Increasing focus on Low/No calorie
Expansion in Stills
Innovation
ZEROunconformities were found
in the food safety and
quality audits
All CCI plants obtained Food Safety
System Certification
FSSC 22000 Standard
54
55
PUBLICPUBLIC
Superior
ExecutionCommercial
Excellence
Excellence in
Supply Chain
We are investing in developing our
people and technologies to provide
the best experience for our
business partners; customers and
distributors and win with the
customer
Satisfaction Surveys
CCI Customer Interaction Center
Joint Business Plan Meetings
CCI Turkey’s 2018 distributor
satisfaction survey score was up by
5 points reaching 91%
CCINext Red Box module won
the
Most Successful Retail Channel
award given by TCCC at the
Global Customer & Commercial
Leadership
(GCCL) Awards
Operational Excellence (OE)
with the long-term intention of
meticulously improving our
business processes and
systems
The OE Model is based on Lean
Six Sigma methodologies and
applied to all company functions
1,518 OE Projects*
781 certifications
USD71 mn savings*
* (2008-2018)
55
56
PUBLICPUBLIC
Supplier Guiding
PrinciplesDiversity and Inclusion Health and Safety
Supplier Guiding Principles (SGP)
determine the social, environmental,
ethical and economic minimums
TCCS expect from their suppliers.
SGP Audit
Targets for
Years
2019
75%
2020
85%
Diversity and Inclusion
Advisory Board
“Women in Leadership” program
UN Women’s Empowerment
Principles
CCI Women Network
Gender
Generation
“Leaders in the Field” meetings
The U30 Strategy Camp
Culture
“Leaders in the Field” meetings
The U30 Strategy Camp
Health and safety issues
managed through the Coca-Cola
Operating Requirements (KORE)
CCI improved its Safety Maturity
Index (SMI) score by +5% in 2018
30% increase in workplace safety
training time provided to
employees vs. 2017
53,200 human-hours of OHS*
training to our employees
*Occupational Health & Safety
56
57
PUBLICPUBLIC
57
Human Rights
Policy…
CCI published its first
Human Rights Policy
in 2018, a continuation
of the existing CCI
Workplace Rights
Policy
Integrating human rights and
workplace rights
into all of our practices,
corporate values, and
sustainability strategy
…integrated to our
practices…
…affecting various
stakeholders
Human rights trainings
targeting CCI employees
&
Additional 30,000 people
through our 4,000 suppliers
57
58
PUBLICPUBLIC
Employee
Engagement
CCI Talent Management Principles
My Career Platform
CCI Career Navigation Framework
Talent Readiness Index (TRI) has risenfrom 46% to 53% in 2019..
Talent
Management
“Leadership in Field” program
“Value Play Shop” program
CCI Employee Engagement Surveys
Teamwork Passion
Accountability Integrity
58
59
PUBLICPUBLIC
BIST 50 Sustainability Index
59
60
PUBLICPUBLIC
2030 Targets
to be releasedIntegrated Report
Science Based Targets Initiatives
CEO Water Mandate
Bloomberg
Gender-Equality Index
60
61
PUBLICPUBLIC 61
62
PUBLICPUBLIC
Appendix
63
PUBLICPUBLIC
Population
(mn)(1)
GDP per cap,
PPP (USD 000) (2)
Per capita
NARTD
consumption (L)(3)
CCI's Market
Share in
Sparkling (4)
CCI's Market
Position in
Sparkling
Capacity
(mn UC)
Capacity
Utilization Rate
Turkey 83.0 28.8 56 66% 1 684 78%
Pakistan 216.6 4.7 29 48% 2 408 79%
Kazakhstan 18.6 28.9 87 51% 1 162 78%
Iraq 39.3 15.5 57 42% 2 147 75%
Azerbaijan 10.1 18.6 45 86% 1 59 68%
Jordan 10.1 9.5 42 20% 2 35 47%
Turkmenistan 5.9 20.5 n.a. n.a. n.a. 23 43%
Kyrgyzstan 6.4 4.1 46 70% 1 16 109%
Tajikistan 9.3 3.6 18 n.a. n.a. 18 25%
Source: (1,2) IMF World Economic Outlook (3) CCI and TCCC estimates (4) Nielsen, Canadean
63
