Randstad Nv · EURONEXT:RAND

Randstad Nv — Shareholder Meeting (March 2018)

71 slides from Randstad Nv's shareholder meeting presentation, Mar 27, 2018

  1. Slide 1: Annual general meeting of shareholders

    annual general meeting of shareholders Randstad Holding nv March 27, 2018

  2. Slide 2: Disclaimer & definitions

    disclaimer & definitions Certain statements in this document concern prognoses about the future financial condition, risks, investment plans and the results of operations of randstad Holding and its operating companies, as well as certain plans and objectives. Obviously, such prognoses involve risks

  3. Slide 3: Agenda

    agenda 1. opening 2. review 2017 3. discharge of liability 4. composition executive board 5. composition supervisory board 6. shares 7. other corporate affairs 8. external auditor 9. any other business 10. closing © randstad | 3

  4. Slide 4: Agenda

    agenda 1. opening 2. review 2017 3. discharge of liability 4. composition executive board 5. composition supervisory board 6. shares 7. other corporate affairs 8. external auditor 9. any other business 10. closing © randstad | 4

  5. Slide 5: Review 2017: operational performance & strategy

    review 2017 operational performance & strategy. © randstad | 5

  6. Slide 6: Our purpose is to support people and organizations in realizing their true potential

    our purpose is to support people and organizations in realizing their true potential. |

  7. Slide 7: FY 2017: strong conversion of robust topline

    FY 2017: strong conversion of robust topline. revenue of € 23,273 million topline grew 10% in Europe gross margin 20.2% organic growth 8.3%1 1% in North America and 10% pricing climate stable in Rest of the world gross profit up 7%2 perm fees up 10% underlying EBITA of € 1,065 FY 2017 FCF up 26% to

  8. Slide 8: Regional split: robust growth continues despite tougher comps

    regional split: robust growth continues despite tougher comps. YoY Randstad organic revenue growth development 20% 10% 0% -10% Q4 2013 Q2 2014 Q4 2014 Q2 2015 Q4 2015 Q2 2016 Q4 2016 Q2 2017 Q4 2017 Group Europe North America Rest of the world • Europe grew 10% in 2017 (vs. 6% in 2016) • North Ameri

  9. Slide 9: Topline growth accelerating vs. peers powered by integrated tech

    organic revenue pwd growth, 2017 topline growth accelerating vs. peers france powered by integrated tech. 15% 10% organic revenue pwd growth by quarter, 2012-2017 5% 10% 0% Randstad Peer 1 Peer 2 8% italy 6% 30% 4% 25% 2% 20% 0% 15% Randstad Peer 1 Peer 2 2012 2013 2014 2015 2016 2017 -2% iberia -4%

  10. Slide 10: Organic revenue growth in key markets

    organic revenue growth in key markets france, spain, italy leading the way. 1% North America 1% 11% Belgium 2% • France grew 12% (vs. 7% in 2016) France 12% 7% • North America grew 1% (vs. 1% in 2016) 2% Netherlands • Rest of the world increased 10% (vs. 7% in 2016) 3% 9% • Group grew 9% (vs. 5% in

  11. Slide 11: Revenue split FY 2017

    revenue split FY 2017. split by geographical areas split by revenue categories 5% 5% 8% 18% 20% 9% 14% 7% 52% 6% 22% 7% 16% 10% NAM NL FR GER BEL IBE IT RoE RoW global businesses staffing inhouse professionals global businesses © Randstad | 11

  12. Slide 12: EBITA split FY 2017

    EBITA split FY 2017. split by geographical areas 0% 5% 6% 22% 8% 7% 9% 19% 11% 21% NAM NL FR GER BEL IBE IT RoE RoW global businesses © Randstad | 12

  13. Slide 13: Strategic roadmap

    strategic roadmap best people, strong concepts, excellent execution & superior brands. © Randstad | 13

  14. Slide 14: EBITA margin outlook 2017/18

    ebita margin outlook 2017/18. topline business topline growth growth mix digital opex digital • consensus + 4.5% • ongoing investments sales growth 2018 • early signs of additional • expected market sales growth outperformance business mix opex • focus on perm/profs/inhouse/SME; • € 90-100M annual p

  15. Slide 15: A data world to win

    a data world to win randstad has the largest pool of talent acquisition data. 355,625,000 1,625,000 225,000 104,625,000 2,625,000 average number of open jobs at clients served applications placements candidates in our any time every year every year every year databases the role of technology 39 36,5

  16. Slide 16: Connecting initiatives and scaling up successful concepts fast

    we are connecting the initiatives and scaling up successful concepts fast around the world. digital factory RIF scale ups (15 investments) • data-driven sales • pymetrics • workforce • montage scheduling • crunchr • brazen external local innovations innovations tech & touch • randstad direct via M&A

  17. Slide 17: Learning a new way of working to make T&T happen

    we are learning a new way of working to make T&T happen getting focus and proof to scale up. 1. focus tech & touch portfolio, 2. build MVPs with clients/candidates/ drive with integrated team consultants instantly learn & improve experiments. local MPV mature products 5% 58% 37% 3. think big, start

  18. Slide 18: New technology does not resolve old problems

    new technology does not resolve old problems focus on culture and values continues. • we have 36,500 ambassadors working for Randstad • high turnover rate in many countries • not Utopia; we do live in the real world, with real people – so we come across unacceptable conduct and do investigate indepe

  19. Slide 19: Our core values guide us in how we work

    our core values guide us in how we work. Our values shape our culture. They help us to trust develop, grow and better serve our clients, We are respectful. We value our candidates and other stakeholders. relationships and treat people well. striving for perfection to know We always seek to improve a

  20. Slide 20: Our required behavior

    our required behavior. • tone at the top • transparency • clear and open communication • focus on integrity • good governance | 20

  21. Slide 21: Sustainability is at the heart of Randstad's business

    sustainability is at the heart of randstad’s business. one of Randstad's core values is the simultaneous promotion of all interests. we play a key role in society since 1960; work is a unifying force • contributing to labor participation, social inclusion, well-being. • offering employment solutions

  22. Slide 22: Our ultimate goal

    our ultimate goal In 2030 we will touch the work lives of 500 million people worldwide stimulating economic growth being connected to people fostering inclusive employment shaping the world of work name presenter developing promoting contributing to enabling clients to improve improving employabilit

  23. Slide 23: Financial results & outlook

    financial results & outlook. © Randstad | 23

  24. Slide 24: Long term value creation

    long term value creation. increasing our returns by optimizing ICR/RR, portfolio mix, DSO & cash, M&A & synergies and market outperformance FY 2017 ROIC: 16.7% FY 2016 ROIC: 15.9% =NOPAT (Invested Capital * WACC) floating interest rate policy © Randstad | 24

  25. Slide 25: Income statement FY 2017

    income statement FY 2017 € million FY ’17 FY ’16 % org. revenue 23,273 20,684 8% gross profit 4,708 3,934 7% gross margin 20.2% 19.0% operating expenses* 3,643 2,987 5% opex margin 15.7% 14.4% EBITA* 1,065 947 11% EBITA margin* 4.6% 4.6% integration costs & one-offs -/-72 -/-55 reported EBITA 994 89

  26. Slide 26: Performance by revenue category

    performance by revenue category € million FY 2017 FY 20161 % organic2 Staffing revenue 12,184 11,400 6% EBITA 623 547 11% EBITA margin 5.1% 4.8% Inhouse services revenue 5,185 4,461 18% EBITA 251 223 13% EBITA margin 4.8% 5.0% Professionals revenue 4,720 4,067 4% EBITA 276 226 6% EBITA margin 5.9% 5

  27. Slide 27: FY 2017 gross margin bridge

    FY 2017 gross margin bridge • temp margin decreased 30bp compared to last year due to adverse mix e ects and pricing • permanent placements had no impact, while HR Solutions had a positive impact of 160bp driven by the Monster acquisition • At Group level, the contribution from permanent placements

  28. Slide 28: FY 2017 operating expenses bridge

    FY 2017 operating expenses bridge 3.700 11 3.643 3,700 12 14 23 3.650 87 3.600 3.550 535 6 3.500 3.450 3.400 3.350 3.300 3.250 3.200 3.150 3.100 3.050 2.988 (33) 3.000 2.950 2.900 2.850 2.800 2.750 2.700 2.650 2.600 2.550 2,500 2.500 FY 2016 FX M&A Marketing Organic EU Organic NA Organic ROW Organic

  29. Slide 29: Net debt at €1,026M

    net debt at €1,026M leverage ratio at 0.9, versus guidance of 1.0 € million Q4 2017 Q4 2016 goodwill and acquisition-related intangible assets 3,476 3,286 operating working capital (OWC) 889 712 net tax assets 357 480 all other assets and liabilities* 556 456 invested capital 5,277 4,934 total equit

  30. Slide 30: FY 2017 free cash flow, up 82% YoY

    FY 2017 free cash flow, up 82% YoY € million FY ’17 FY ’16 EBITDA 1,081 966 change in OWC -/-175 -/-170 income taxes -/-186 -/-160 provisions & employee benefit obl. 8 - net capital expenditures -/-96 -/-94 other items -/-39 -/-77 financial assets -/-7 -/-1 free cash flow 586 465 net acquisitions/di

  31. Slide 31: Strategic target: FCF stability over the past years

    FCF stability over the past 10 years. 800 3,0 700 2,5 600 2,0 500 400 1,5 strategic target 300 1,0 200 0,5 100 0 0,0 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 FCF ex-CICE (€ M) CICE (€ M) leverage ratio © Randstad | 31

  32. Slide 32: Acquired companies well on track

    acquired companies well on track aim to be top 3 in strengthen Professionals accelerate progress towards local Staffing business digital strategy EVA after 3 years market in line ahead ahead underway ahead underway © randstad | 32

  33. Slide 33: M&A outlook 2018 and beyond

    M&A outlook 2018 and beyond. tech & touch strategy professionals staffing • mainly organic through • acceleration through Ausy • top position in most relevant digital factory (organic & bolt-on M&A) markets, ex-Japan, UK & Australia • repair Monster & global • over time: small to mid- • no priority

  34. Slide 34: Adjusted capital allocation strategy

    adjusted capital allocation strategy adjusted capital allocation strategy impact on FY 2017 payout in 2018 maintain cash dividend policy with regular cash dividend: €2.07 per payout 40 – 50%; implement floor share, based on 50% payout ratio cash dividend of € 1.62 per share when leverage ratio < 1.0

  35. Slide 35: Cash dividend proposal: up 46% including special dividend

    cash dividend proposal: up 46% including special dividend • proposed cash dividend payment over 2017 • payment of € 2.76 per ordinary share (+ 46% YoY) • regular dividend of € 2.07 based on payout of 50% of adjusted net profit • special dividend of € 0.69 based on proposed adjusted capital allocatio

  36. Slide 36: Dividend process and timeline in 2018

    dividend process and timeline in 2018 • March 27, 2018: approval shareholders in AGM • March 29, 2018: ex-dividend date regular cash dividend • April 3, 2018: record date regular cash dividend • April 5, 2018: payment of regular cash dividend • Third quarter 2018: payment of special cash dividend (i

  37. Slide 37: Some specific questions

    some specific questions • sustainable development goals - most impact on goal 8: we promote sustained, inclusive and sustainable economic growth, full and productive employment and decent work for all - integrated in our strategy and ultimate goal towards 2030, connections made in our reporting fram

  38. Slide 38: 2. Review 2017 Q&A

    2. review 2017 Q&A | 38

  39. Slide 39: 2b. Corporate governance structure and compliance

    2. review 2017 2b. main items corporate governance structure and compliance with the corporate governance code | 39

  40. Slide 40: 2c. Application of the remuneration policy in 2017

    2. review 2017 2c. application of the remuneration policy in 2017 • last update remuneration policy approved by the AGM in 2017 • remuneration 2017 in line with approved policy • extensive remuneration report 2017 on corporate website | 40

  41. Slide 41: 2d. Proposal to adopt the financial statements 2017

    2. review 2017 2d. proposal to adopt the financial statements 2017 | 41

  42. Slide 42: Overview of the Deloitte audit

    Overview of the Deloitte audit COMMUNICATION - Several meetings and calls with Supervisory Board / Audit Committee - Audit plan, management letter and year- FINANCIAL STATEMENTS AND end report MANAGEMENT REPORT - Unqualified auditor’s report - Management Report: information as required by Part 9, Bo

  43. Slide 43: 2d. Policy on reserves and dividends

    2. review 2017 2d. explanation of the policy on reserves and dividends | 43

  44. Slide 44: Adjusted capital allocation strategy

    adjusted capital allocation strategy adjusted capital allocation strategy impact on FY 2017 payout in 2018 maintain cash dividend policy with regular cash dividend: €2.07 per payout 40 – 50%; implement floor share, based on 50% payout ratio cash dividend of € 1.62 per share when leverage ratio < 1.0

  45. Slide 45: 2e. Proposal to determine the regular dividend

    2. review 2017 2e. proposal to determine the regular dividend over the financial year 2017 | 45

  46. Slide 46: Cash dividend proposal: up 46% including special dividend

    cash dividend proposal: up 46% including special dividend • proposed cash dividend payment over 2017 • payment of € 2.76 per ordinary share (+ 46% YoY) • regular dividend of € 2.07 based on payout of 50% of adjusted net profit • special dividend of € 0.69 based on proposed adjusted capital allocatio

  47. Slide 47: Dividend process and timeline in 2018

    dividend process and timeline in 2018 • March 27, 2018: approval shareholders in AGM • March 29, 2018: ex-dividend date regular cash dividend • April 3, 2018: record date regular cash dividend • April 5, 2018: payment of regular cash dividend • Third quarter 2018: payment of special cash dividend (i

  48. Slide 48: 2f. Proposal to determine a special dividend

    2. review 2017 2f. proposal to determine a special dividend over the financial year 2017 | 48

  49. Slide 49: Agenda

    agenda 1. opening 2. review 2017 3. discharge of liability 4. composition executive board 5. composition supervisory board 6. shares 7. other corporate affairs 8. external auditor 9. any other business 10. closing © randstad 49 |

  50. Slide 50: 3a. Discharge of liability of executive board

    3. discharge of liability 3a. discharge of liability of the members of the executive board for the management | 50

  51. Slide 51: 3b. Discharge of liability of supervisory board

    3. discharge of liability 3b. discharge of liability of the members of the supervisory board for the supervision of the management | 51

  52. Slide 52: Agenda

    agenda 1. opening 2. review 2017 3. discharge of liability 4. composition executive board 5. composition supervisory board 6. shares 7. other corporate affairs 8. external auditor 9. any other business 10. closing © randstad 52 |

  53. Slide 53: 4a. Reappoint Jacques van den Broek to executive board

    4. composition executive board 4a. proposal to reappoint Jacques van den Broek as member of the executive board • Dutch national • appointed to the Executive Board in 2004 • appointed Chairman of the Executive Board and CEO in 2014 • reappointment for a period of 4 years | 53

  54. Slide 54: 4b. Reappoint Chris Heutink to executive board

    4. composition executive board 4b. proposal to reappoint Chris Heutink as member of the executive board • Dutch national • appointed to the Executive Board in 2014 • reappointment for a period of 4 years • responsible for the Netherlands, Italy, Poland, Switzerland, Austria, Hungary, Czech Republic,

  55. Slide 55: 4c. Appoint Henry Schirmer to executive board

    4. composition executive board 4c. proposal to appoint Henry Schirmer as member of the executive board • German national • proven track record • several international finance roles across markets and categories • appointment for a period of 4 years • remuneration in line with remuneration policy | 5

  56. Slide 56: 4d. Ad-hoc amendment of executive board remuneration policy

    4. composition executive board 4d. proposal to ad-hoc amend the remuneration policy of the executive board in regard to the appointment of Henry Schirmer • One-off grant of Randstad shares • Retention period of 5 years • Retransfer pro ratio in case of early leave | 56

  57. Slide 57: Agenda

    agenda 1. opening 2. review 2017 3. discharge of liability 4. composition executive board 5. composition supervisory board 6. shares 7. other corporate affairs 8. external auditor 9. any other business 10. closing © randstad 57 |

  58. Slide 58: 5a. Reappoint Frank Dorjee to supervisory board

    5. composition supervisory board 5a. proposal to reappoint Frank Dorjee as member of the supervisory board • Dutch national • member of the Supervisory Board since 2014 • chairman of the Audit Committee • reappointment for a period of 4 years | 58

  59. Slide 59: 5b. Appoint Annet Aris to supervisory board

    5. composition supervisory board 5b. proposal to appoint Annet Aris as member of the supervisory board • Dutch national • extensive knowledge of digital transformation • appointment for a period of 4 years • chair of the remuneration committee | 59

  60. Slide 60: Agenda

    agenda 1. opening 2. review 2017 3. discharge of liability 4. composition executive board 5. composition supervisory board 6. shares 7. other corporate affairs 8. external auditor 9. any other business 10. closing © randstad 60 |

  61. Slide 61: 6a. Extend authority to issue shares

    6. shares 6a. proposal to extend the authority of the executive board to issue shares • valid for a period of 18 months • approval by the supervisory board • yearly allocation of performance shares not more than 1% • yearly maximum authorization of 3% of the issued capital • anti-dilution preference

  62. Slide 62: 6b. Extend authority to restrict pre-emptive rights

    6. shares 6b. proposal to extend the authority of the executive board to restrict or exclude the pre- emptive right to any issue of shares • valid for a period of 18 months • approval by the supervisory board • yearly maximum authorization of 3% of the issued capital | 62

  63. Slide 63: 6c. Authorize repurchase of ordinary shares

    6. shares 6c. proposal to authorize the executive board to repurchase ordinary shares • valid for a period of 18 months • maximum of 10% of the issued share capital of ordinary shares • ordinary shares may be acquired for a price between the nominal value and 110% of the closing price | 63

  64. Slide 64: 6d. Cancel repurchased ordinary shares

    6. shares 6d. proposal to cancel repurchased ordinary shares • valid for a period of 18 months • cancel ordinary shares up to a maximum of 10% of the issued share capital of ordinary shares • only ordinary shares held by the company may be cancelled | 64

  65. Slide 65: Agenda

    agenda 1. opening 2. review 2017 3. discharge of liability 4. composition executive board 5. composition supervisory board 6. shares 7. other corporate affairs 8. external auditor 9. any other business 10. closing © randstad 65 |

  66. Slide 66: 7. Proposal to amend the articles of association

    7. amendment of articles of association 7. proposal to amend the articles of association • name change Randstad Holding nv into Randstad N.V. • modernization of articles of association • update in line with recent changes to laws and regulations | 66

  67. Slide 67: Agenda

    agenda 1. opening 2. review 2017 3. discharge of liability 4. composition executive board 5. composition supervisory board 6. shares 7. other corporate affairs 8. external auditor 9. any other business 10. closing © randstad 67 |

  68. Slide 68: 8. Reappoint Deloitte Accountants as external auditor

    8. external auditor 8. proposal to reappoint Deloitte Accountants bv as external auditor for the financial year 2019 • initial appointment at the AGM in 2014 for the 2015 financial year | 68

  69. Slide 69: Agenda

    agenda 1. opening 2. review 2017 3. discharge of liability 4. composition executive board 5. composition supervisory board 6. shares 7. other corporate affairs 8. external auditor 9. any other business 10. closing © randstad 69 |

  70. Slide 70: Agenda

    agenda 1. opening 2. review 2017 3. discharge of liability 4. composition executive board 5. composition supervisory board 6. shares 7. other corporate affairs 8. external auditor 9. any other business 10. closing © randstad 70 |

  71. Slide 71: Human forward

    eaesle human forward. WM

Randstad — Shareholder Meeting (March 2018) on 6ix