Slide 1: Investor Information Presentation cover letter
Brambles Limited ABN 89 118 896 021 Level 40 Gateway 1 Macquarie Place Sydney NSW 2000 Australia GPO Box 4173 Sydney NSW 2001 Tel +61 2 9256 5222 Fax +61 2 9256 5299 www.brambles.com For personal use only 11 May 2009 The Manager - Listings Australian Securities Exchange Limited Exchange Centre 20 Br
Slide 2: Brambles overview
For personal use only 2009 OPERATIONS REVIEW Brambles overview 11 May 2009 2009 OPERATIONS REVIEW Mike Ihlein Chief Executive Officer 1
Slide 3: 2009 Operations Review agenda and Brambles profile
2009 Operations Review For personal use only Europe focused Meet management Site visits Focus on operations Agenda Monday • Brambles overview including trading update • Recall Europe Tuesday and Wednesday • CHEP Europe 3 Brambles Profile Leading global provider of supply chain and inform
Slide 4: Two businesses
Two businesses For personal use only • CHEP is the leader in pallet and • Recall is a leader in the management container pooling services of information throughout its life cycle • Partners with customers to develop • One stop, end to end, information pooling solutions that ensure reduced management
Slide 5: Brambles Leadership Team
Brambles Leadership Team For personal use only Mike Ihlein Chief Executive Officer Joined Brambles in 2004 Kevin Shuba Group President, USA, Canada, Latin America, CHEP Americas Catalyst & Chemical Containers and LeanLogistics Liz Doherty Joined Brambles in 1996 Chief Financial Officer Joined Brambl
Slide 6: Strong historical group performance
Strong historical group performance For personal use only Sales Revenue1 Underlying Profit2 5,000 1,200 1,099 10% CAGR 4,500 4,359 21% CAGR 1,000 953 4,000 3,869 3,522 3,500 3,275 798 800 3,000 617 2,500 600 2,110 515 2,073 484 2,000 400 1,500 1,000 200 US$ millions US$ millions 500 0 0 FY05 FY06 FY
Slide 7: Brambles Strategy
Brambles Strategy For personal use only Long-Term Stakeholder Value CUSTOMER OPERATIONAL GROWTH SATISFACTION EXCELLENCE & & QUALITY SUSTAINABILITY PEOPLE SYSTEMS 11 Consumer confidence Regional/country consumer confidence indices (January 2000 – January 2009) 110 105 100 95 90 85 Jan-00 Jan-01 Jan-0
Slide 8: Trading update
Trading update For personal use only Sales revenue for the 10 months to 2 May 2009 up 2% • Excluding automotive, sales revenue up 3% Sales revenue 1 January to 2 May 2009 broadly in line with prior year Growth in both CHEP and Recall • CHEP Americas up 3% • CHEP EMEA up 1% • CHEP Asia-Pacific
Slide 9: Initiatives to underpin future performance
Initiatives to underpin future performance For personal use only Taking actions to meet challenging and volatile conditions • US$160m quality investment in CHEP USA • Accelerated scrapping of seven million excess pallets (CHEP USA) • Rationalisation of facilities and operations across the globe
Slide 10: Brambles still delivering sales revenue growth
Brambles still delivering sales revenue growth… For personal use only P&G – 30 Apr Unilever – 7 May 2009 “Volu il 200 Profits deflate me 9 for th declined f at German giants “…volumes lower by 1.8%...” p e quar ive p rimari ter dr ercent ly ive Adidas and Metro “Underlying sales down in contract by
Slide 11: Strong cash flow generation
Strong cash flow generation For personal use only 4,000 3,500 25% 3,335 24% 3,115 22% 23% 3,000 18% 2,500 2,305 2,000 1,466 1,500 1,000 704 US$ millions 500 0 FY05 FY06 FY07 FY08 1H09 Cumulative CF from Operations Underlying profit margin 1. Cash flow from operations for continuing operations 19 Str
Slide 12: Cash generation
Cash generation For personal use only Primary focus on reducing pallet capex • P&L / cash trade-off • Cautious investment in new growth opportunities EBITDA • Discretionary costs • Restructuring Other • Working capital • Tax Capital management Initiatives • Dividend Reinvestment Plan • Share
Slide 13: ROCI and BVA
ROCI and BVA For personal use only 25% 600 24% 24% 22% 22% 500 17% 400 300 200 US$ millions 100 0 FY05 FY06 FY07 FY08 1H08 1H09 BVA at fixed June 2008 exchange rates BVA ROCI 23 Ensuring adequate returns Wood Capital cost $20 Revenue per issue $5 Turns / year 3.5 Losses per issue 2% Scraps per issue
Slide 14: Ensuring adequate returns
Ensuring adequate returns For personal use only Wood Other 1 Capital cost $20 $75 Revenue per issue $5 $5 Turns / year 3.5 3.5 Losses per issue 2% 2% Scraps per issue 1% 1% Pallet life (years) 13.3 28.6 Transport costs % sales 19% 15% Plant cost % sales 26% 10% Overheads % sales 16% 10% Operating co
Slide 15: Ensuring adequate returns
Ensuring adequate returns For personal use only Wood Other 1 Other 2 Capital cost $20 $75 $65 Revenue per issue $5 $5 $5 Turns / year 3.5 3.5 6.0 Losses per issue 2% 2% 1% Scraps per issue 1% 1% 0.1% Pallet life (years) 13.3 28.6 >30 Transport costs % sales 19% 15% 15% Plant cost % sales 26% 10% 10%
Slide 16: Net debt and gearing
Net debt and gearing For personal use only 3,000 65% 61% 2,800 58% 58% 2,600 48% 2,400 2,200 36% 2,000 1,800 25% 1,600 17% 17% 13% 1,400 12% 11% US$ millions 1,200 1,000 FY05 FY06 FY07 FY08 1H08 1H09 Net debt Gearing % Debt / Enterprise Value % 29 Credit facilities and liquidity Good progress on r
Slide 17: Summary
Summary For personal use only Growth despite challenging / volatile environment • Not immune from downturn but • Net new business wins Well positioned for economic recovery Major initiatives on track Balance sheet in good shape Strong business models 31 2009 OPERATIONS REVIEW Q&A 16
Slide 18: Disclaimer statement
Disclaimer statement For personal use only The release, publication or distribution of this presentation in certain jurisdictions may be restricted by law and therefore persons in such jurisdictions into which this presentation is released, published or distributed should inform themselves about and
Slide 19: Recall Introduction
2009 OPERATIONS REVIEW For personal use only 11 May 2009 2009 OPERATIONS REVIEW Introduction Elton Potts
Slide 20: Recall presenters
Recall presenters For personal use only Introduction and Overview Elton Potts, Group President and Chief Operating Officer With Brambles since 2002 Base: USA Recall Europe Trace Norton, President, Recall Europe With Brambles since 1998 Base: United Kingdom Profitable Growth Christian Coenen, Global
Slide 21: Who we are
Who we are For personal use only Document Management Solutions Physical and digital capture, indexing, storage and retrieval of critical documents Secure Destruction Services Confidential destruction of sensitive documents, media and other business items Data Protection Services Secure storage
Slide 22: Diversified revenue sources
Diversified revenue sources For personal use only 2008 Sales Breakdown US$748 million By service By region 3% 10% 25% 24% 45% 66% 27% Americas Europe Australia/New Zealand * Based on actual reported rates. Asia 7 Introduction Europe Profitable Growth Overview How Recall makes money Annuity Businesse
Slide 23: Impact of global economic crisis
Impact of global economic crisis For personal use only Customers Recall Fewer transactions at financial Slowing growth in activity-related institutions revenue; retention levels strong Increase in regulatory oversight Increase in consultative workflow Increased growth in digital Greater
Slide 24: Reducing costs
Reducing costs For personal use only Reduction in workforce by ~5% since June 2008 Reduction in discretionary spending Review and renegotiation of supplier contracts Capital expenditure reprioritisation expected to yield ~US$15m additional cash for FY09 11 Introduction Europe Profitable Grow
Slide 25: Business snapshot
Business snapshot For personal use only A strong business • Stable business characteristics with diverse recurring revenue streams • Relatively resilient to economic volatility • Consistently positive cash flow worldwide A disciplined approach to global management • Strong, experienced managemen
Slide 26: Value through excellence and growth
Value through excellence and growth For personal use only Recall operates in an attractive, dynamic market space • Total opportunity size ~US$12b+ • Substantial opportunity in unvended market segment • Mega trends (legislation, privacy) shaping demand We are well-positioned for growth • First or
Slide 27: Regional strength
Regional strength For personal use only Strong geographic presence Established leaders in major geographies Business model adaptable to external factors Continued opportunity in existing and future market segment • 9 countries • 59 dedicated operation centres • ~1,100 Team Members • ~21,000
Slide 28: Europe overview
Europe overview For personal use only FY08 Country Revenue FY08 Service Line Revenue 10% / $21m* 11% / $21m* 14% / $29m* 2% / $4m* 42% / $84m* 29% / $59m* 73% / $148m* 19% / $38m* Spain Secure Destruction Services France Data Protection Services United Kingdom Document Management Solutions – Physica
Slide 29: Digital expansion
Digital expansion For personal use only Key piece of Europe business Aligned with industry trends Complementary to physical management offering Proven customer value 29 CAGR 19% 22 18 17 14 US$m FY04 FY05 FY06 FY07 FY08 * Based on actual reported rates. Revenue* 21 Introduction Europe Profit
Slide 30: Country profile: France
Country profile: France For personal use only Recognized industry leader National coverage • 24 Information Centres • 14 Cities • ~350 Team Members 59 CAGR 51 13% 44 44 37 US$ Millions FY04 FY05 FY06 FY07 FY08 * Based on actual reported rates. Revenue* 23 Introduction Europe Profitable Growth Ov
Slide 31: Customer satisfaction
Customer satisfaction For personal use only Annual third-party measurement Recall ranks in top 1/3 (of 450,000 global service provider surveys) in 4 critical customer areas • Overall rating • Competitive advantage • Likelihood to recommend • Likelihood to repurchase Leadership in key areas of
Slide 32: Efficiency
Efficiency For personal use only Six Sigma • Significant DSO improvement achieved in four countries Lean/Kaizen approach to continuous improvement • UK facility productivity improvement of 40% Benchmarking and best practice adaptation • Sales force activity measured by individual, by country
Slide 33: Strong leadership team
Strong leadership team For personal use only Continuous investment in safety and security training Employment satisfaction measured globally Diversity amongst leadership and throughout the organisation Belgium Brazil Denmark France United States Germany India Philippines Other Malaysia Norway
Slide 34: Profitable Growth
2009 OPERATIONS REVIEW For personal use only Profitable Growth Christian Coenen Key messages Market trends and our business focus are aligned Our approach to profitable growth • Organic growth through business excellence • New business in selected and tested geographies and vertical industries •
Slide 35: Industry trends
Industry trends For personal use only Legislation • Increased oversight • Companies increasingly attuned to cost of non-compliance Privacy Outsourcing • Overhead reduction • Risk mitigation • Industry expertise • Focus on core competencies Information and business process outsourcing (BPO) 3
Slide 36: Global opportunity
Global opportunity For personal use only Multi-national customers Cross-selling programs Capitalise on unvended segment through sales efficiency Provide flexibility through innovation • Common operating platform • Menu of services • Standard operating procedures (SOPs) Best practice identi
Slide 37: Market opportunity and position: DMS-P
Market opportunity and position: DMS-P For personal use only Total Opportunity* Recall Position per Country** 6% 1% 8% 1% 28% 40% 50% 66% Leader Recall #2 Unvended #3 Other Vended #4 #5 *Source: Boston Consulting Group, 2008. **Estimated position within the vended market. 37 Introduction Europe Prof
Slide 38: Reaching the market
Our customers For personal use only Business Vertical Business Footprint Finance and Banking Global companies Legal International corporations Insurance Regional businesses Healthcare Sole proprietorships Government Emerging markets Media Retail Professional services 39 Int
Slide 39: Our customers
Summary For personal use only Recall anticipates needs in the global marketplace Agility • Long-term customer solutions • Sustainable partnerships • Innovation • Performance measurement • Continuous improvement Recall provides solutions for – and grows with – a diverse customer base Globally f
Slide 40: Financial strength and stability
Financial strength and stability For personal use only Solid profit and cash flow despite external factors Disciplined approach to fiscal management Flexible business model • Expansion • Investments • Partnering with customers Cash flow from operations provides sufficient funds for capital e
Slide 41: Q&A and disclaimer
2009 OPERATIONS REVIEW For personal use only Q&A Disclaimer statement The release, publication or distribution of this presentation in certain jurisdictions may be restricted by law and therefore persons in such jurisdictions into which this presentation is released, published or distributed should