Slide 1: Interim Results
Interim Results For the half year ended 30 March 2012 1
Slide 2: Agenda
Agenda Highlights Patrick Coveney, CEO Financial Review Alan Williams, CFO Operating & Strategic Review Patrick Coveney, CEO Outlook Patrick Coveney, CEO Q&A Open to the Floor 2
Slide 3: Highlights
Highlights • Strong revenue, operating profit and adjusted EPS performance despite continued challenging market conditions • Good progress on Uniq integration – on track to deliver business plan • Acquisition of MarketFare – brings further scale and focus to US business • Continue to target strong g
Slide 4: Financial Review
Financial Review Alan Williams Chief Financial Officer 4
Slide 5: Financial Summary
Financial Summary H1 12 Versus H1 11 Revenue Revenue £567.7m +49.9% Revenue Revenue –– continuing £541.7m +9.3% continuing activity activity11 Operating Operating profit profit22 £31.7m +36.7% Operating Operating margin margin22 5.6% -50 bps Adjusted Adjusted earnings earnings33 £21.1m +74.7% Adjust
Slide 6: Convenience Foods
Convenience Foods • Strong sales and profit H1 12 H1 11 % performance despite £m £m change challenging market conditions: Revenue – • Continuing activity revenue 532.6 344.8 +54.5% as reported growth of 9.7% driven by Revenue – good category momentum continuing 506.6 461.7 +9.7% and market share gai
Slide 7: Ingredients & Property
Ingredients & Property • Division represents around H1 12 H1 11 % 6% of Group revenue £m £m change • Good performance in ingredients growing both Revenue 35.1 33.8 +3.8% revenue and operating profit • Outline planning permission obtained for Littlehampton Operating site in December 2011 – 1.0 0.9 +1
Slide 8: Finance Cost
Finance Cost Bank interest payable virtually unchanged from H1 11 despite incremental debt to part finance Uniq acquisition £m H1 12 H1 11 Bank interest payable (8.1) (7.9) Unwind discount to present value 0.1 0.1 Finance cost* (8.0) (7.8) Net pension financing charge (2.4) (0.6) FX/Fair value of de
Slide 9: Tax Charge
Tax Charge • The Group’s effective tax rate has reduced to 4% (FY11: 13%) largely as a result of the Uniq acquisition • Cash tax of £0.2m (H1 11: £1.5m) • An income statement credit will be recognised each year in relation to the amortisation of the intangible assets identified on acquisition • Uniq
Slide 10: EPS and Dividend
EPS and Dividend EPS H1 12 H1 11 EPS • Adjusted earnings 74.7% ahead Adjusted earnings3 £21.1m £12.1m • Adjusted earnings per share up 19.6% after taking into account Denominator for effect of the rights issue 382.3m 260.2m earnings per share Adjusted earnings per 5.5p 4.6p share3 Dividend Dividend
Slide 11: Cashflow
Cashflow Significant improvement in H1 operating cashflow £m H1 12 H1 11 EBITDA 43.4 32.3 Working capital movement (12.2) (17.6) Total capex (14.1) (13.0) Interest & tax (7.2) (10.6) Operating cashflow 9.9 (8.9) Difference between pension charge and cash contributions (7.0) (4.2) Exceptionals (10.1)
Slide 12: Net Debt and Leverage
Net Debt and Leverage • Net debt at 30 March 2012 of £262.2m, an increase of £122.4m reflecting Uniq consideration paid of £112.7m • Total committed facilities of £443m – weighted average maturity of 3.9 years • MarketFare consideration paid in April 2012 of £22.6m for historic EBITDA of £3.6m – imp
Slide 13: Summary Financial Performance
Summary Financial Performance • Strong financial and operating performance despite challenging market conditions • Substantial increase in revenue and operating profit post the Uniq acquisition • Sustainable reduction in effective tax rate • Adjusted EPS growth of 19.6% to 5.5 pence 13
Slide 14: Operating & Strategic Review
Operating & Strategic Review Patrick Coveney Chief Executive Officer 14
Slide 15: FY12 Priorities
FY12 Priorities SUSTAIN strong organic growth momentum 1) OPERATIONAL and commercial positions of underlying PERFORMANCE category business DELIVER Uniq integration benefits and 2) UNIQ transform revenue, profitability and cash INTEGRATION generation profile of our Group REPOSITION the US convenience
Slide 16: Operational Performance - Drivers of Group Performance in H1 12
1. Operational Performance - Drivers of Group Performance in H1 12 % CONVENIENCE FOODS REVENUE GROWTH 9.7 1 5.3 6.1 DRIVERS UK Food 6 UK Chilled Greencore LFL months to Convenience 6 March 2012* months to • Strong underlying category and March 2012* customer momentum % CONVENIENCE FOODS • Significan
Slide 17: Operational Performance - Food to Go
1. Operational Performance - Food to Go No. No. 11 in sandwiches in sandwiches 36%* 36%* market share • Strong category performance across all market share core customers • Momentum from new business wins SANDWICHES delivered in second half of FY11 now delivering above market growth trajectory 7.9%
Slide 18: Operational Performance - Prepared Meals
1. Operational Performance - Prepared Meals No. No. 11 in Italian ready in Italian ready meals meals 26%* 26%* market share market share • Re-shaped business delivering across READY MEALS multiple product categories (ready meals, quiche and soups & sauces) • Strong underlying growth delivered in rea
Slide 19: Operational Performance - Grocery & Frozen
1. Operational Performance - Grocery & Frozen No. No. 11 in own label in own label cooking cookingsauce sauce 77%* 77%* • Enhanced performance generated market share market share through category focus, range simplification and leveraging OWN LABEL COOKING SAUCES manufacturing scale • Significant sh
Slide 20: Operational Performance - Tackling Industry Challenges
1. Operational Performance - Tackling Industry Challenges CHALLENGE GREENCORE ACTION IMPACT • Product and packaging solutions to reduce • ‘Cash margin’ broadly impact sustained Input price • ‘Total Lowest Cost’ and ‘Lean Greencore’ to • Customer and supplier inflation of c. 5% reduce labour and over
Slide 21: Uniq Integration - Synergy Delivery
2. Uniq Integration - Synergy Delivery TARGET STATUS • High performing sandwich business with potential for further growth • Strong growth sustained • Addition of material ‘new customer’ for Greencore Group • Position established with deepening relationships 1. COMMERCIAL • Opportunity to restructur
Slide 22: Uniq Integration - Change in Customer Mix
2. Uniq Integration - Change in Customer Mix H1 FY11 H1 FY12 Source: Estimated based on Greencore retail revenue for the first 26 weeks of FY12, excluding Uniq activity exited and to be exited 22
Slide 23: US Strategy - A Growing Platform
3. US Strategy - A Growing Platform Facilities Products Markets Newburyport Newburyport Brockton Brockton Region Region MA MA Sandwiches Sandwiches North NorthEast East MA MA East Coast Baguettes Baguettes East Coast Chilled Mid MidAtlantic Chilledmeals meals Atlantic Fredericksburg Salt Fredericksb
Slide 24: US Strategy - Changing Landscape
3. US Strategy - Changing Landscape Sustained Fresh Food growth …reflecting growing …and changing retailer commitment competitor landscape Accelerating consolidation of 9% supply base across key categories 3% Emergence of specific channels/category solutions Chilled/ Fresh Ambient Source: Daymon Wor
Slide 25: US Strategy - Momentum for Greencore
3. US Strategy - Momentum for Greencore • Vision and sense of market opportunity reinforced by the last four years • Enormous internal and marketplace learnings • Deliberate shift in strategy to: REFINEMENT IN STRATEGY − Food to Go − Small store focused − Customer led • Improving sentiment and perfo
Slide 26: US Strategy - MarketFare Foods
3. US Strategy - MarketFare Foods BUSINESS OVERVIEW • Leading manufacturer of Food to Go products for convenience and small stores • Revenue of $65m and EBITDA of $5.7m for year ended 27 January 2012 • Two manufacturing facilities in Fredericksburg, Virginia and Salt Lake City, Utah • Largest single
Slide 27: US Strategy - Emerging Shape
3. US Strategy - Emerging Shape Customer Footprint: National Convenience Chains: • A focused, channel-specific, customer- specific strategy • A business of enhanced scale – with the North East Grocery Chains: capacity to now deliver $200m-$250m of revenue with existing customers from current sites •
Slide 28: Outlook
Outlook • Trading environment in the UK remains challenging • No evidence of material easing in inflation • Notwithstanding these pressures, we continue to target: • Good underlying revenue growth • Strong growth in adjusted earnings per share 28
Slide 29: greencore
greencore greencore bringing convenience to good food