Coca-Cola Europacific Partners plc

Hello and thank you for standing by. We would like to welcome everyone to today's Coca-Cola Europacific Partners H1 2021 conference call. All attendee lines have been muted to avoid any background noise. After the speaker's remarks, we will have a question and answer session. To enter today's question and answer queue, please press star 1 on your telephone keypad. To withdraw your question, Press the pound key. It's now my pleasure to hand today's conference over to Vice President of Investor Relations, Sarah Willett. Ma'am, I give it to you.

Thank you all for joining us today. I'm here with Damian Gammell, our CEO, and Nick Jang here on the LCFO. Before we begin with our opening remarks and our results for the second quarter and half year 2021, a reminder of our cautionary statements. This call will contain forward-looking management comments, and other statements reflecting our outlook. These comments should be considered in conjunction with the cautionary language contained in today's release as well as the detailed cautionary statements found in reports filed with the UK, US, Dutch and Spanish authorities. A copy of this information is available on our website www.cocacolaep.com. Prepared remarks will be made by Damian and Nick and accompanied by a slide deck. We will then turn the call over to your questions. Many of the metrics presented today will be on a pro-forma basis. These reflect the results of CCP Angar Australian Pacific and Indonesian business unit API, as if the Coca-Cola-Anatole transaction had occurred at the beginning of this year. Comparable measures reflect the timing impact of the Anatole deal, which completes in May. The slides and our prepared remarks will distinguish between these two methodologies accordingly.

Thank you Sarah and many thanks to everyone joining us today. Let's start with our half one key takeaways. A strong performance delivered by highly engaged colleagues in quite a dynamic environment so to all my colleagues I'm sincerely grateful for the hard work and commitment that you've all shown to CCEP and continue to show as we close out 2021. We are again the number one FMCG customer value creator in Western Europe. And I'm very pleased to say that we continue to win market share both in-store and online across the NARTD category. Critically, we are continuing to accelerate our investments across two key areas, our sustainability agenda alongside our ongoing digital transformation. And I'm very pleased that the integration of API is well underway and we are working on joint growth plans with the Coca-Cola company as we look forward to an even more exciting 2022. We have a simple but vital purpose as we move forward as Coca-Cola Europacific Partners to refresh Europe, the Pacific and Indonesia and critically to make a difference for all our communities and our stakeholders. We do believe in a bright future for our business led by our aspiration to be the world's most digitized Coca-Cola bottler. And as I mentioned earlier, our strong commitment to delivering on our ambitious sustainability agenda. We have a solid track record of delivery and execution and I'm very pleased we do retain our number one position as customer value creator in Western Europe. We are fortunate to operate in a highly attractive, valuable and growing category. With our exciting portfolio of brands, products and packaging we enjoy scale and a leading position across all our geographies we also have a great opportunity to continue to unlock the potential of our newly acquired business unit api we continue to position ourselves to be fit and competitive for the longer term despite covid we have continued to invest for long-term growth particularly in our portfolio our people Our digital journey and our sustainability agenda. We know we will go further together creating greater more sustainable value for all of our stakeholders. We have a simple focus around great people, great service, great beverages, done sustainably for a better shared future. So now I'd like to touch on each of these areas as we look back on the first half of this year. As you know, the well-being and safety of our colleagues is our absolute number one priority. We continue to support our colleagues through the evolving challenges of the pandemic, as well as the recent widespread flooding that unfortunately occurred in Belgium and Germany. We continue to work to break down barriers to inclusion. Our colleagues celebrated pride across many of our sites and offices and shared photos and stories on our digital communication platform, Redline. In New Zealand, we were thrilled to be named New Zealand's Employer of Choice 2021, the only company to receive a gold award in three consecutive years. And across CCEP, we're also recognised as a great place to work, with strong engagement shown in our first global engagement and culture survey as Coca-Cola Europacific Partners, which has been recently completed. Great service is critical for our customer growth story and engagement. Supporting our customers and the reopening of Harica has been a key priority and we launched a number of initiatives across all of our markets such as We Are Harica campaign in Spain and a customized digital support program in France and Germany. In Europe our focused and creative Euro football activation generated great excitement not just for our customers, our colleagues, but also of course for our consumers as lockdown eased and people could do what they love to do across Europe during the summer get out and about and enjoy a coke with friends and family and despite these challenges of the pandemic we have maintained high levels of customer service in the high 90s and we will continue to invest in capacity to support our growth and our revenue growth management initiatives this includes placing over 50 000 cold drink equipment units in the first half of this year, increasing our canning capacity and efficiency, and accelerating our insourcing plans. This year, we've already installed can lines from Papua New Guinea and a septic line in France in the first half of the year. And we've launched StarStock, an online marketplace in GB, and Wabi, a B2B ecosystem platform in Portugal, both where our ventures are, CCEP ventures. as we continue to explore and progress new models that make it easier for our customers to do business with us. And lastly, we're extremely privileged to make, move and sell the best beverages in the world. Both Coca-Cola Zero and Monster continue to outperform across all of our markets in the first half. Our new taste, new look and new campaign for Coca-Cola Zero Sugar in Europe has been a great success. Our Monster Innovations have supported impressive growth. Mule, Ultra Fiesta Mango and Monarch launched in 8 of our European markets. And we also launched Monster Super Fuel in Australia and New Zealand. We are very excited about Costa Coffee and we are readily expanding this brand outside of GB. We are making good progress in Germany, Belgium and Norway and we recently launched Costa Express in Spain. In Indonesia we launched a new and well received Fanta flavour Coco Pandan for Ramadan and Tapachico continues to be an exciting opportunity now launched in six of our European markets. As we progress in our commercial agenda we do this with a mindset clearly focused around sustainability and we know we need to go further and faster on this agenda. Carbon reduction is at the heart of our business. as we move towards our net zero greenhouse gas emissions target by 2040 across our entire value chain. Contributing around 40% of these emissions, packaging is clearly front and centre and I am pleased that we are making progress on a number of fronts. Across Europe, we are continuing to accelerate our ORPT plans toward our ultimate goal of 100%. In Australia, we have signed up to a JV to build and operate a new PET recycling facility expected to process 1 billion bottles per year and produce over 20,000 tons of recycled PET across the partnership and likewise in Indonesia we have announced an industry collaboration to construct a recycling facility that will have the capacity to save 25,000 tons of virgin plastic each year this will help stimulate the recycling industry in Indonesia and accelerate Much needed improvement in recycling rates. Both collaborations are a step forward towards creating a circular economy for PET within our industry. Beyond packaging, I'm also extremely proud to achieve carbon neutral status at two of our manufacturing sites in Spain and Sweden, with the aim of extending the certification to a further four sites by the end of 2023. We have met the global benchmark for responsible water stewardship in the Netherlands, making this plant one of just five in the Coca-Cola system to achieve such an accreditation. And finally, we recently signed up to the EU code of conduct for responsible business and marketing practices which aims to make healthy and sustainable food choices easier for our consumers. So all in all, A great first half towards a better shared future with a clear acknowledgement that there's more to do and we must go faster. Just turning now to our performance. We are pleased to report a strong performance in the first half. We continue to win with our customers, having created more than double the absolute value sales increase compared to any of our peers in Western Europe. Supporting the reopening of Harica has been a key area as I touched on earlier. A strong performance from our core brands has led to some great share gains both in-store and critically online. Across our combined markets we gained 90 basis points of share and flavors and 170 basis points in energy and our European markets In our European markets, our energy portfolio has gained nearly 300 basis points of value share since 2019. The performance in Europe was supported by the new monster flavors, wider distribution, resulting in an impressive volume growth of 50% versus 2019, meaning we are well on track to double the size of a European energy business relative to 2019. All of these elements combine to deliver a very solid top line performance. The 6% increase in pro forma comparable volume obviously reflects the easing of restrictions in Q2 and the soft prior year comparables. As you will recall, Q2 was the worst impacted period last year. We've been encouraged with the pace of volume recovery and I'm particularly pleased that our continued focus on revenue growth management has driven growth in revenue for Unicate above pre-pandemic levels. and impressive results given the mixed headwinds we've continued to face during the first half of this year. We're moving at pace to accelerate our digital capabilities and I'll come back to this on the next slide. We do remain focused on efficiency and are on track to deliver the efficiency programs and the combination benefits that we shared with you earlier this year. And finally, we've made a great start with the API integration. Going further together and I'll provide a little bit more detail on this later. So to some highlights on our digital transformation journey, a critical journey for all of us at CCMP as we aspire to lead and to be the world's most digitized Coca-Cola bottler. We have seen continued share gains and strong performance in online grocery with our RSV of 28% and our online grocery share up by 100 basis points. In Europe, Our beverages are also the most ordered beverages on food aggregator platforms. Our own B2B portal, myccep.com, is on track to deliver a record year of over 1 billion in revenue. We expect the number of customers using the platform to reach 90,000 by the end of the year, an increase of over 150%. In GB, Starstock was launched in partnership with CCEP Ventures Starstock is an online marketplace which enables licensed venues to order directly from major drinks companies and brewers. It's a great example of how our Ventures platform is focused on identifying strategically relevant partners that can help CCEP make our business more efficient, sustainable and future-proof. And I'm also very excited that we've launched Wabi, a new easy-to-be platform in Portugal. We continue to develop our D2C platform, Your Coca-Cola. Encouragingly, the platform's average order value is increasing. This is aided by recent product innovation, subscription services and special bundles for special occasions. One recent innovation was the launch of personal icons, a great and fun way for us to engage directly with our consumers. We are taking learnings and generating valuable consumer insights. We're partnering with the Coca-Cola company to leverage the power and insight of the system as we progress on our digital journey. From the supply chain perspective, achieving a single integrated source-to-pay process and touchless invoice automation through the implementation of SAP Ariba will provide over 100,000 hours of efficiency savings. And in the workplace, we recently launched Compass which brings all of our workplace digital services together making it easier for all of our colleagues to find the tools they need when they need them. The use of automated translation is also driving time and cost efficiencies across CCEP. And on that note, I would now like to hand over to Nick to talk more in detail to the financials. Nick.