Annual Report 2014

STRATEGIC REPORT - STRATEGY Achievements and priorities

Strategic achievements in FY2014

Objective 1

During FY2014

to maintain strong brand market combinations in core markets by investing in our customer proposition, brands and developing our multi-beverage platforms

  • we integrated the Gleeson business into the Group to create a major new combination with a leading multi-beverage offering in Ireland
  • we continued to invest in our premium brands, notably Bulmers, Tennent’s, Magners and Woodchuck
  • we put resources behind rejuvenating our secondary brands and into innovation
  • acquired a 50% interest in Wallaces Express Limited

Objective 2

During FY2014

to transform our international business through investment in brands and infrastructure and through the development of strategic alliances and acquisitions

  • we invested in the new cidery in Vermont
  • we repositioned our distribution network in the US to bring Magners and the Vermont brands into the same network
  • we restructured our distribution arrangements in Australia
  • opened up a number of new markets in Asia
  • launched Tennent’s beer aged in Whisky Oak, Montano Italian cider, and Lemon T

Strategic priorities for FY2015

In FY2015 our core strategic objective continues to be to enhance future earnings growth. In FY2015 the focus will continue around our recently acquired businesses but, with our balance sheet strength and high cash conversion, we are well positioned to take advantage of opportunities as they arise.

Core Objective

Our core strategic objective continues to be to enhance future earnings growth

  • In FY2015 the focus will continue to be around our recently acquired businesses
  • With our balance sheet strength and high cash conversion, we are well positioned to take advantage of opportunities as they arise

Strategic priorities

Recently-acquired businesses

  • To derive the synergies and operational benefits of the integrated Gleeson-Bulmers business
  • To integrate the Tennent’s and Wallaces Express businesses to achieve synergy benefits, creating an integrated multi-beverage business
  • To achieve the benefits of the new production facilities in Vermont and a restructured US distribution network

Existing businesses

  • To maintain the earnings of the UK cider business through improved sales execution and innovation
  • To grow international earnings

Cash conversion

  • To maintain the strong cash conversion characteristics of the business and to invest either within the business or in enhancing shareholder return
  • To maintain an appropriately leveraged balance sheet to achieve earnings growth

Corporate responsibility

  • Targeting further sustainability improvements across the Group
  • Focusing our social responsibility agenda on engagement in the community
  • Achieving a continuous improvement in workforce health and safety