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Campari Group-Annual report at 31 December 2019
1
CAMPARI GROUP
ANNUAL REPORT FOR THE YEAR ENDED
31 DECEMBER 2021
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Campari Group-Annual report at 31 December 2019
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Campari Group-Annual report for the year ended 31 December 2021
Index 3
Index
Disclaimer
This document was not made available to the public with a signed version, which is retained at the Group corporate office.
Relazione sulla Giestione 4
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Campari Group-Annual report for the year ended 31 December 2021
- Relazione finanziaria annuale al 31 dicembre 201
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About this report
Note on presentation
The annual report for the year ended 31 December 2021 was prepared in accordance with the International Financial Reporting Standards (‘IFRS’), issued by the International Accounting Standards Board (‘IASB’), as adopted by the European Union and with Part 9 of Book 2 of the Dutch Civil Code. The designation IFRS also includes International Accounting Standards (‘IAS’) as well as all the interpretations of the International Financial Reporting Standards Interpretation Committee (‘IFRS IC’), formerly the Standard Interpretations Committee (‘SIC’).
In accordance with articles 15 and 18 of Consob Regulation 20249 of 28 December 2017 concerning ‘Conditions for the listing of shares of parent companies that control companies incorporated under and regulated by the law of countries other than EU Member States’, the parent company Davide Campari Milano N.V. has identified its significant subsidiaries as defined article 15, paragraph 2, of the above-mentioned Regulation, and verified that the conditions set out in paragraphs b) and c) of article 15 have been met.
Forward-looking statements
Campari Group’s annual report contains forward-looking statements that reflect management’s current view of the Group’s future development. All statements other than statements of historical fact set forth in this annual report regarding Campari Group business strategy, such as future operations and businesses, management’s plans and objectives, are forward-looking statements. In some cases, words such as ‘may’, ‘will’, ‘expect’, ‘could’, ‘should’, ‘intend’, ‘estimate’, ‘anticipate’, ‘believe’, ‘outlook’, ‘continue’, ‘remain’, ‘on track’, ‘design’, ‘target’, ‘objective’, ‘goal’, ‘plan’ and similar expressions are used to identify forward-looking statements that contain risks and uncertainties that are beyond the control of the Group and call for significant judgement. Should the underlying assumptions turn out to be incorrect or if the risks or opportunities described materialise, the actual results and developments may materially deviate (negatively or positively) from those expressed by such statements. The outlook is based on estimates that Campari Group has made on the basis of all the information available at the time of completion of this annual report. The actual impact of Covid-19 and its associated operating environment may be materially different from management’s expectations.
Factors that could cause the actual results and developments to differ from those expressed or implied by the forward-looking statements are included in the section ‘Risk management and Internal Control System’ of this annual report. These factors may not be exhaustive and should be read in conjunction with the other cautionary statements included in this report. Forward-looking statements made in this annual report shall be evaluated in the context of these risks and uncertainties.
Campari Group does not assume any obligations or liability in respect of any inaccuracies in the forward-looking statements made in this annual report or for any use by any third party of such forward-looking statements. Campari Group does not assume any obligation to update any forward-looking statements made in this annual report beyond statutory disclosure requirements.
Information on the figures presented
All references in this annual report are expressed in ‘Euro’ or ‘€’.
For ease of reference, all the figures in this annual report are expressed in millions of Euro to one decimal place, whereas the original data is recorded and consolidated by the Group in Euro. Similarly, all percentages relating to changes between two periods or to percentages of net sales or other indicators are always calculated using the original data in Euro. The use of values expressed in millions of Euro may therefore result in apparent discrepancies in both absolute values and data expressed as a percentage.
For information on the definition of the alternative performance measures used, see paragraph ‘Definitions and reconciliation of the Alternative Performance Measures (APMs or non-GAAP measures) to GAAP measures’ in the dedicated paragraph of this annual report.
The language of this annual report is English. Certain legislative references and technical terms have been cited in their original language so that the correct technical meaning may be ascribed to them under applicable law.
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Campari Group-Annual report for the year ended 31 December 2021
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European Single Electronic Format requirements
The Transparency Directive 1 , requires all natural and legal person with securities listed on a European stock exchange to prepare their annual financial reports in compliance with the European Single Electronic Format, or ESEF. The entire annual financial report, i.e. including ad minima the audited financial statements and the management board report, shall be prepared in xHTML format. Specifically, issuers preparing IFRS consolidated financial statements shall mark up those using Inline XBRL and prepare a single report ESEF compliant package. To facilitate the introduction of the new rules, only the consolidated primary financial statements and certain administrative information shall meet the ESEF requirements for the first year of application.
During December 2020, the European Parliament and the Council included an amendment to the Transparency Directive allowing for a 1-year postponement to 1 January 2021 of the obligation for listed companies to draw up and publish their annual financial reports in accordance with ESEF. The ESEF postponement was adopted as a supplementary measure to help the recovery from the Covid- 19 pandemic
Campari Group managed ESEF by leveraging on a dedicated IT software, allowing to comply with the new regulation. In accordance with ESEF Regulation, Campari Group implemented the 2020 ESEF XBRL Taxonomy file as reference taxonomy for the 2021 annual accounts. This annual report is therefore ESEF compliant.
1 Directive 2004/109/EC of the European Parliament and of the Council of 15 December 2004 on the harmonisation of transparency requirements in relation to information about issuers whose securities are admitted to trading on a regulated market and amending Directive 2001/34/EC.
Campari Group-Annual report at 31 December 2020
- Relazione finanziaria annuale al 31 dicembre 2019
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Campari Group-Annual report at 31 December 2020
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Campari Group’s identity and business overview 9
Campari Group’s identity and business overview
Campari Group at a glance
Campari Group, a leading company in the global branded spirits industry, was founded in Milan in 1860, when Gaspare Campari created the world-famous red aperitif. With a portfolio of more than 50 premium and super premium brands owned and with leadership positions in Europe and the Americas, Campari Group is today the sixth-largest player in the global premium spirits industry. Its brands are distributed in 190 markets through a direct distribution network in 22 countries and are manufactured in 22 production facilities around the world. With an official seat in the Netherlands , Campari Group is headquartered in Sesto San Giovanni (Milan), Italy, and employs approximately 4,000 people around the world.
Full year 2021 results-Key highlights
Campari Group achieved double-digit sales organic growth in 2021 driven by continued strong and healthy brand momentum. Despite the challenges of logistic constraints and the initial effect of cost inflation towards the year end, full year 2021 results showed a strong recovery versus the year before and benefitted from also an overall increased consumption and penetration of its brands compared to pre-pandemic levels.
In terms of profitability, it achieved a strong EBIT (2) growth and margin expansion mainly driven by favourable sales mix and operating leverage thanks to strong topline growth, which enabled in particular sustained brand building investments to fuel strong brands.
Thanks to the very healthy cash flow generation driven by the solid business performance, Campari Group achieved a significant de-leverage with net debt to EBITDA-adjusted (2) ratio down to the current 1.6 times at year end.
The Board of Directors proposed a full year dividend of €0.06 per share.
Key Financials
for the year ended 31 December
2021
2020
€ million
€ million
% total change
% organic change
Net sales ʿ¹ʾ
2,172.7
1,772.0
22.6%
25.6%
EBITDA
480.6
309.8
55.1%
EBITDA adjusted
514.9
399.9
28.8%
34.7%
EBIT
400.8
231.8
72.9%
EBIT adjusted
435.2
321.9
35.2%
42.3%
Group net profit
284.8
187.9
51.6%
Group net profit-adjusted
307.9
202.1
52.4%
Basic earning per share (€)
0.25
0.17
Diluted earning per share (€)
0.25
0.16
Basic earning per share (€) adjusted ʿ²ʾ
0.27
0.18
Diluted earning per share (€) adjusted ʿ²ʾ
0.27
0.17
Average number of employees
3,842
3,784
Free cash flow
332.3
168.6
Free cash flow adjusted
407.5
261.7
Net financial debt
830.9
1,103.8
(1) Sales net of excise duties.
(2) For information on the definition of alternative performance measures, see the paragraph ‘Definitions and reconciliation of the Alternative Performance Measures (APMs or non-GAAP measures) to GAAP measures’ of this annual report.
€ million
AMERICAS
SEMEA
NCEE
APAC
Total
net sales
927.9
638.8
438.1
167.8
2,172.7
EBIT-adjusted
184.5
71.2
162.5
17.0
435.2
employees ʿ¹ʾ
1,719
1,440
503
291
3,953
(1) Number of employees as of 31 December 2021.
The shares of the parent company, Davide Campari-Milano N.V. (Reuters CPRI.MI-Bloomberg CPR IM), have been listed on the Italian Stock Exchange since 2001.
Campari stock
2021
since IPOʿ²ʾ
absolute share performance
37.6%
1558.7%
total shareholder returnʿ¹ʾ
38.4%
2096.2%
(1) Total return with dividend reinvested (annualised). Source: Bloomberg.
(2) Initial public offering date: 6 July 2001.
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Campari Group-Annual report for the year ended 31 December 2021
Campari Group’s identity and business overview 10
Key Non-Financials
Our people
6.7% voluntary people turnover in 2021 (4.0% in 2020).
51.6% Camparistas who decided to join the ESOP during 2021 (Employee Share Ownership Plan).
Responsible practices
100% communication containing Responsible Drinking Messages (RDMs) in 2021 (unchanged compared with 2020).
Responsible communication e-learning for 100% marketing community activated in 2021 (in 2020 the project was approved and planned for 2021).
Environment
-24% MJ/L energy consumption 2 in 2021 (-4% MJ/L in 2020).
-26% L/L water consumption 3 in 2021 (-16% L/L in 2020).
2 Between FY 2021 and FY 2020
3 Between FY 2021 and FY 2020
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Campari Group-Annual report for the year ended 31 December 2021
Campari Group’s identity and business overview 11
Campari Group emerging stronger from Covid-19
The Covid-19 (‘Coronavirus’) pandemic, which began in 2020 and had a huge impact on the world, still persists. The global recovery continues with different paths country by country, mainly thanks to progress of vaccination campaigns, nonetheless uncertainty remains due to the continued emergence of new appearing variants. Specifically, in many regions where vaccination rates remain low, such as some emerging markets, new localised lockdowns and renewed uncertainty occurred. Trade has largely returned to pre-pandemic levels, but tensions have emerged over supplies of commodities and intermediate inputs, partly due to the rapidity of the recovery, as well as logistics services, currently facing significant constraints across global markets. The health