Sig Group Ag · SIX:SIGN
Sig — SIG Combibloc Group — Non-Deal Roadshow (September 2019)
31 slides from Sig's roadshow presentation, September 2019
Slide 1: SIG Combibloc Roadshow Presentation
SIG COMBIBLOC ROADSHOW PRESENTATION CEO ROLF STANGL CFO SAMUEL SIGRIST AUGUST/SEPTEMBER 2019
Slide 2: Disclaimer
DISCLAIMER The information contained in this presentation is not for use within information provided in this presentation and we disclaim any liability for the expense, depreciation of property, plant and equipment and right-of-use any country or jurisdiction or by any persons where such use would u
Slide 3: SIG in Brief: Uniquely Positioned in a Growth Industry
SIG UNIQUELY POSITIONED IN BRIEF IN A GROWTH INDUSTRY INTEGRATED SYSTEM LONG-TERM STRONG SERVICE DIFFERENTIATED SIG WITH PROPRIETARY CUSTOMER NETWORK AND SUPPLY TECHNOLOGY: FILLING MACHINES, RELATIONSHIPS: CHAINS ASEPTIC CARTON SLEEVES, CLOSURES, >25 YEARS ON AVERAGE SLEEVES CAN BE FILLED SERVICES F
Slide 4: Complete Packaging System and Service Solutions to Customers
COMPLETE PACKAGING SYSTEM TRUSTED PARTNER AND SERVICE SOLUTIONS TO CUSTOMERS FOR LEADING BLUE CHIP CUSTOMERS FULL SUITE INCREASING OUR PORTFOLIO LONG-TERM RELATIONSHIPS OF DIFFERENTIATED SOLUTIONS OF VALUE-ADDED SERVICES WITH BLUE CHIP CUSTOMERS FILLING LINES SMART FACTORY, SUPPLY CHAIN AND TECHNICA
Slide 5: Razor / Razorblade Business Model
RAZOR / RAZORBLADE BUSINESS MODEL BASE OF 1,180 FILLERS – RECURRING LEVERAGING OUR FULL SOLUTIONS OFFERING REVENUES AND SCOPE FOR GROWTH CUSTOMER PARTNERSHIP ...THAT YIELDS ATTRACTIVE UNIT ECONOMICS1 BUILT ON A FULL SYSTEM OFFERING… FILLERS 6% SLEEVES & CLOSURES 88% SERVICE 6% (OF TOTAL REVENUE2) (O
Slide 6: High Level of Service Favours Customer Retention
HIGH LEVEL OF SERVICE INTEGRATED IN FAVOURS CUSTOMER RETENTION CUSTOMERS’ DAY-TO-DAY OPERATIONS RAW MILK RAW MILK MILK MILK OUTBOUND RAW MILK UHT FILLING LINE SLEEVES & CLOSURES CONSUMER RECEPTION STORAGE PASTEURISER TANKS LOGISTICS RAW MATERIAL RECEPTION PROCESSING PACKAGING SYSTEMS DISTRIBUTION &
Slide 7: Differentiated Technology
DIFFERENTIATED BROAD AND FLEXIBLE TECHNOLOGY PRODUCT OFFERING FILLING CAPABILITIES VOLUME, UP TO 16 PRODUCT VARIANTS ENABLING VALUE GROWTH FORMAT, POSSIBLE ON ONE FILLER DESIGN RANGE OF FILL VOLUMES FROM FLEXIBILITY ON-THE-GO NEW CONSUMPTION BREAKFAST MILK 80ML TO 2,000ML ACROSS OCCASIONS WITH DRINK
Slide 8: Innovation: Consumer-Centric
INNOVATION CONSUMER-CENTRIC • Ongoing investment in R&D: ~3% of sales • New Tech Centre in Suzhou, China will speed pace of innovation across the APAC region • combismile meeting on-the-go demand in China • Produced on new type of filler machine • Successful combination with drinksplus • Now launche
Slide 9: Sustainability: Leading the Way
SUSTAINABILITY LEADING THE WAY • All carton packs fully recyclable with 70-80% DEVELOPING renewable material THE MOST • SIGNATURE PACK: first aseptic carton 100% SUSTAINABLE linked to renewable forest-based materials FOOD PACKAGING • Now sold in several countries SOLUTIONS ON • Pioneer in third part
Slide 10: Sustainability: Recent Milestones
SUSTAINABILITY ON A JOURNEY RECENT MILESTONES TO BECOME NET POSITIVE SIGNATURE PACK PROMOTING SALES UP 10X1 RECYCLING FIRST CARTON SUSTAINABLE COMPANY TO PACKAGING OFFER A FOR WATER PAPER STRAW 1 H1 2019 VS H1 2018 10
Slide 11: Resilient Financial Performance Over Time
RESILIENT FINANCIAL TOP LINE GROWTH, PERFORMANCE OVER TIME MARGIN EXPANSION, STRONG CASH GENERATION 2008-18 2008-18 2008-18 ROCE: REVENUE CAGR: ADJ. EBITDA CAGR: ADJ. EBITDA MARGIN EXPANSION 4% 5% ~400BPS >20%3 CONSTANT CURRENCY % CORE REVENUE1 GROWTH % 1.590 1.644 1.568 1.563 1.546 1.483 TOTAL REVE
Slide 12: H1 2019 Financial Highlights
H1 2019 FINANCIAL STRONG HIGHLIGHTS TOP LINE GROWTH CORE REVENUE ADJUSTED EBITDA ADJUSTED NET FREE CASH FLOW ROCE (LTM) MARGIN INCOME +5.1% 25.6% €80.5 €36.8 20% AT CONSTANT (H1 2018: 25.9%) MILLION MILLION CURRENCY (H1 2018: (H1 2018: €2.0 m) €48.4 m) CORE REVENUE ADJUSTED EBITDA ADJUSTED – NET CAP
Slide 13: H1 2019 Performance Key Points
H1 2019 PERFORMANCE ON TRACK KEY POINTS TO MEET FY TARGETS CONTINUING STRONG ROBUST SALES IN BRAZIL FAVOURABLE CURRENCY PERFORMANCE IN AND STRONG H1 FOR MIDDLE AND RAW MATERIAL TRENDS GROWTH MARKETS EAST JOINT VENTURE ONGOING INVESTMENT EXPANSION OF PLANT LEADING THE WAY IN INNOVATION NETWORK IN APA
Slide 14: Revenue Evolution: Half Year and Q2
REVENUE EVOLUTION CONTINUING STRONG PERFORMANCE HALF YEAR AND Q2 IN GROWTH MARKETS H1 2019 Q2 2019 €MILLION €MILLION 20 14 3 8 -19 12 1 763 744 794 802 -9 6 0 8 11 2 4 CONSTANT CURRENCY CONSTANT CURRENCY GROWTH RATE 417 408 GROWTH RATE 435 439 +0.3% +7.7% +10.7% +0.2% +5.1% +13.3% 2018 H1 Non-core C
Slide 15: Adjusted EBITDA Evolution: Half Year and Q2
ADJUSTED EBITDA EVOLUTION TOP LINE CONTRIBUTION HALF YEAR AND Q2 IMPROVED IN Q2 H1 2019 Q2 2019 €MILLION €MILLION MARGIN 25.6%1 7 0 3 -4 -6 -1 9 MARGIN 27.3%1 198 207 206 3 6 0 2 0 -4 1 112 115 120 2018 H1 FX NET OF FX TOP LINE RAW PRODUCTION JV SGA MISC 2019 H1 2018 Q2 FX NET OF FX TOP LINE RAW PRO
Slide 16: Adjusted EBITDA Margin Development by Region
ADJUSTED EBITDA MARGIN DEVELOPMENT BY REGION EMEA APAC AMERICAS ▪ Lower dividend from Middle ▪ Strong revenue growth ▪ Strong revenue growth East joint venture ▪ Favourable currencies ▪ Favourable currencies ▪ Negative mix effect ▪ Combismile ramp-up costs ▪ Higher freight costs €million EMEA APAC A
Slide 17: Adjusted Net Income: Significant Increase
ADJUSTED NET INCOME ADJUSTMENTS LOWER SIGNIFICANT INCREASE THAN IN PREVIOUS YEARS €million 2019H1 2018H1 PROFIT / (LOSS) FOR THE PERIOD 25 (48) Financing costs and exchange rate impacts (2) 16 PPA depreciation and amortisation 69 70 Adjustments to EBITDA 3 25 Of which: Share of profit or loss of joi
Slide 18: Free Cash Flow: Higher Cash Conversion
FREE CASH FLOW CASH GENERATION HIGHER CASH CONVERSION WEIGHTED TO H2 €million 2019H1 2018H1 NET CASH FROM OPERATING ACTIVITIES 121 105 Dividends received from joint ventures 7 11 Acquisition of property, plant and equipment and intangible assets (87) (113) Payment of lease liabilities (4) (1) FREE C
Slide 19: Working Capital
WORKING CAPITAL WORKING CAPITAL REMAINS WELL CONTROLLED €million 2019H1 2018H1 2018A INVENTORY 194 155 144 TRADE RECEIVABLES 90 92 135 TRADE PAYABLES (165) (168) (166) NET WORKING CAPITAL 118 78 114 OTHER RECEIVABLES / PAYABLES1 (121) (95) (179) OPERATING NET WORKING CAPITAL (3) (17) (66) (1) Includ
Slide 20: Capital Expenditure
CAPITAL FY NET CAPEX GUIDANCE EXPENDITURE 8–10% OF REVENUE €million 2019H1 2018H1 PROPERTY, PLANT & EQUIPMENT 20 29 GROSS FILLER CAPEX 66 84 UPFRONT CASH (26) (25) NET FILLER CAPEX 41 59 TOTAL NET CAPEX 61 88 TOTAL NET CAPEX AS % REVENUE 7.6% 11.5% ADJUSTED EBITDA - NET CAPEX MARGIN 18.0% 14.4% Diff
Slide 21: Leverage
LEVERAGE DIVIDEND PAYMENT IN Q2 €million 2019H1 2018A CASH1 79 157 SENIOR SECURED TERM LOANS 1’577 1’592 LEASE LIABILITIES2 45 26 NET TOTAL DEBT 1’543 1’462 TOTAL NET LEVERAGE RATIO 3.3X 3.2X (1) Includes restricted cash (2) Lease liabilities include €14 million related to the adoption of IFRS 16 Di
Slide 22: Financial Guidance
FINANCIAL FULL YEAR FINANCIAL GUIDANCE GUIDANCE MAINTAINED FY 2019E This Presentation includes mid-term goals that are forward-looking, are subject to significant business, CORE REVENUE GROWTH 4 - 6% (CONSTANT CURRENCY) economic, regulatory and competitive uncertainties and contingencies, many of wh
Slide 23: Aseptic Carton Outpacing Other Forms of Packaging
ASEPTIC CARTON OUTPACING SIG INVESTMENTS OTHER FORMS OF PACKAGING IN HIGH GROWTH REGIONS GLOBAL DAIRY TOP 10, 2018(2) EXPECTED GROWTH NESTLÉ ASEPTIC CARTON PRODUCTION VOLUMES 1 Switzerland (BN LITRES)1 LACTALIS 2 France DANONE 3 France +3.6% 17-22 DAIRY FARMERS OF AMERICA 109.4 CAGR 4 US ~55% OF SIG
Slide 24: Expansion of Plant Network in APAC to Deliver Continuing Growth
EXPANSION OF PLANT NETWORK IN APAC OPTIMISED TO DELIVER CONTINUING GROWTH FINANCING SOLUTION ROBUST DEMAND FOR LOCATED CLOSE TO LIQUID DAIRY IN CHINA NEW SIG TECH CENTRE: AND SOUTH EAST ASIA COMPREHENSIVE ABILITY LEADING TO SERVE CUSTOMERS TO HIGH CAPACITY UTILISATION AT CHINESE TOTAL INVESTMENT AND
Slide 25: New Plant Designed for World Class Performance
NEW PLANT DESIGNED FOR WORLD CLASS PERFORMANCE ENVIRONMENTAL PRODUCTIVITY & SAFETY PERFORMANCE ▪ PROCESS HEAT RECOVERY ▪ CAPACITY UP TO 8BN PACKS ▪ SOLAR ROOFING ▪ INCREASED AUTOMATION: HIGHEST NET SPEEDS WITHIN SIG PLANT NETWORK ▪ MINIMUM WASTE WITH RECYCLING OF PROCESS WASTE ▪ OPTIMISED PLANT LAYO
Slide 26: Summary: Resilient Growth
SUMMARY CONTINUING TRACK RECORD RESILIENT GROWTH OF GROWTH TOP LINE PERFORMANCE RESILIENT END MARKETS FOCUS ON MARGIN DEMONSTRATES CONTINUING AND RAZOR-RAZORBLADE QUALITY AND BUSINESS SUCCESS OF GROWTH BUSINESS MODEL EFFICIENCY STRATEGY DISCIPLINED CAPEX TO BEST-IN-CLASS NEW LEADING THE WAY IN DRIVE
Slide 27: Appendix
APPENDIX
Slide 28: Aseptic Carton Packaging: What Is It?
ASEPTIC CARTON PACKAGING SUPERIOR PRODUCT PROTECTION WHAT IS IT? AND QUALITY FOR UP TO 12 MONTHS HOW IT WORKS SIG SLEEVE TECHNOLOGY • AMONGST THE SAFEST METHODS OF PROCESSING BEVERAGES AND LIQUID FOOD • IN OUR FILLING MACHINE: Printed design • PRODUCTS HEATED BEFORE FILLING/PACKAGING FOR ONLY 2-4 Ou
Slide 29: Two Distinct Aseptic Technologies
TWO DISTINCT ASEPTIC TECHNOLOGIES Production Filling H2O2 sterilisation Paperboard H2O2 drying Polyethylene (PE) Filling nozzle 1 Coating Longitudinal sealing SIG Printing Shipment Filling nozzle 2 Steam injection PE “Sleeve System” Aluminium Sealing PE Cutting in sheets Polyethylene (PE) Coating Cu
Slide 30: Increasing Growth Region Focus
INCREASING GROWTH STRONG FREE CASH FLOW GENERATION IN EUROPE REGION FOCUS SUPPORTS GROWTH MARKET INVESTMENTS 2008 2014 2018 CORE REVENUE CONTRIBUTION NON-EMEA Non-EMEA Non-EMEA 23% APAC 17% 46% 55% APAC 29% APAC 37% EMEA EMEA 45% AMERICAS 54% 6% EMEA AMERICAS 77% 17% AMERICAS 18% EMEA FCF1 €169M €22
Slide 31: Thank You
THANK YOU First carton company to offer a paper straw CEO ROLF STANGL CFO SAMUEL SIGRIST
SIG Combibloc Group — Non-Deal Roadshow (September 2019) on 6ix