Randstad Nv · EURONEXT:RAND
Randstad Nv — Shareholder Meeting (March 2009)
38 slides from Randstad Nv's shareholder meeting presentation, Mar 31, 2009
Slide 1: Annual general meeting of shareholders 2009
annual general meeting of shareholders 2009 Executive Board & Supervisory Board Randstad Holding nv 31 March 2009
Slide 2: Disclaimer
disclaimer Certain statements in this document comprise forecasts on Randstad Holding’s future financial condition and results from operations and certain plans and goals. By their nature, such forecasts generate risk and uncertainty because they concern events in the future and depend on circumstan
Slide 3: Agenda
agenda 1 opening 2 report of the Executive Board and preceding advice of the Supervisory Board for the financial year 2008 3a proposal to adopt the 2008 financial statements 3b explanation of policy on reserves and dividends 3c proposal to determine the dividend over the financial year 2008 4a disch
Slide 4: 2. Report of the Executive Board and preceding advice of the Supervisory Board
2. report of the Executive Board and preceding advice of the Supervisory Board for the financial year 2008 Ben Noteboom 4 31 March 2009 annual general meeting of shareholders 2009
Slide 5: Structure of results presentation
structure of results presentation • FY 2008 results include the acquisition of Vedior - consolidation as per 16 May, 2008 • from revenue up until EBITA: focus on the pro forma figures - best reflection of underlying operational performance - adjusted for integration charges and one-offs • below EBIT
Slide 6: HR services market
HR services market Randstad • value of the global HR services market at least € 200 billion • fragmented market since top 3 players have 25% of the global € 200 billion revenue revenue • market consists of regular staffing and other services like recruitment, secondment and HR-outsourcing • current
Slide 7: Market growth: rapid decline towards the end of 2008
market growth: rapid decline towards the end of 2008 market growth figures YoY 25% 20% 15% 10% 5% 0% -5% -10% -15% -20% Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2006 2007 2008 France the Netherlands Germany Belgium UK N-America • accelerated decline since Q3 2008 • Germany and France faced the steepest (relative)
Slide 8: Randstad: growth drivers & strategy
Randstad: growth drivers & strategy s n al sio es of pr targets • continuous market share gains • EBITA margin target of 5 to 6% on average through the cycle, not below 4% in downturn • integration Vedior & realization of communicated synergies • sound financial position; leverage ratio between 0 an
Slide 9: FY 2008: integration on track, markets losing ground
FY 2008: integration on track, markets loosing ground • interesting yet challenging year - integration of Randstad & Vedior, creating the world’s 2nd largest HR Services provider - market growth sliding in most geographies during the year • internal themes & performance - outperformance in many geog
Slide 10: Steep revenue decline H2 2008, timely cost adjustment
steep revenue decline H2 2008, timely cost adjustment 4800 revenue (€* million) 2007 2008 4600 4400 4200 4000 3800 Q1 Q2 Q3 Q4 750 2007 operating expenses (€* million) 725 2008 700 675 650 625 600 Q1 Q2 Q3 Q4 10 31 March 2009 annual general meeting of shareholders 2009
Slide 11: Performance Randstad vs. market growth in 2008
performance Randstad vs. marketgrowth in 2008 marketgrowth* Randstad Groep diff. vs. market France -/- 5% -/- 4% 1% Netherlands -/- 3% -/- 2% 1% Germany 1% 1% 0% Belgium -/- 1% -/- 3% -/- 2% UK -/- 7% -/- 4% 3% Iberia -/- 10% -/- 5% 5% North America -/- 4% -/- 7% -/- 3% 11 31 March 2009 annual gener
Slide 12: Integration progressing well
integration progressing well • France - integration started in Q1 2009 • The Netherlands - integration Tempo-Team/Vedior & Randstad/Dactylo completed - no loss of market share • Germany - Bindan and Vedior Personalsdienstleistungen integrated into Randstad, incl.back-office • Belgium - rebranding Ve
Slide 13: Acquisition Vedior
acquisition Vedior target progress remarks on target - base case growth scenario of low single digit revenue X resulted in growth impairment - realize significant tangible synergies ahead of plan - minimize forced redundancies in corporate employees - re-branding - maintain client portfolio
Slide 14: 2. Report financial year 2008: financial information
2. report financial year 2008: financial information Robert-Jan van de Kraats 14 31 March 2009 annual general meeting of shareholders 2009
Slide 15: Income statement FY 2008
income statement FY 2008 € million 2008 2007 % change revenue 17,177 17,625 -/- 3% gross profit 3,540 3,637 -/- 3% gross margin 20.6% 20.6% operating expenses* 2,706 2,730 -/- 1% opex as % of revenue 15.8% 15.5% EBITA 834 907 -/- 8% EBITA margin 4.9% 5.1% income before taxes (excl. profit for -/- 10
Slide 16: Development in corporate employees & outlets
development* in corp. employees & outlets indexed organic development in corporate FTEs dec-07 index: September 2007 = 100 104 sep-08 102 dec-08 100 98 96 94 92 90 88 86 84 Group FR NL GE BE UK US indexed organic development in outlets 116 index: September 2007 = 100 dec-07 112 sep-08 108 dec-08 104
Slide 17: Consolidated balance sheet
consolidated balance sheet € million December 31, 2008 December 31, 2007 property, plant & equipment 191 136 intangible assets 3,315 433 deferred tax assets 422 283 other assets 3,795 2,465 group equity 2,421 1,022 non-current liabilities 2,937 960 current liabilities 2,365 1,335 balance sheet total
Slide 18: Tracking synergies / integration costs
tracking synergies / integration costs synergies and integration costs (€ million) ~ 40 12 months forward rolling cash tax 15 realized in 2008 savings 40 benefits target cost 60 22 synergies 90 integration costs - non 5 cash 10 costs integration 57 costs - cash 70 18 31 March 2009 annual general mee
Slide 19: Acquisition Vedior (II)
acquisition Vedior (II) • final offer in 2007 after share price Vedior had gone down from € 23 to € 12 • attentive management; crucial for a quick and successful integration • high premium fully made up for by synergies - both recurring items and one-offs • paid with shares, existing cash and a pre-
Slide 20: Financing: fixed vs. floating interest rates
financing: fixed vs. floating interest rates 6% 5% average fixed 4% rate = 4.1% 3% average floating rate = 3.2% 2% 1% jan. 1997 feb. 2009 floating (3 months EURIBOR) fixed (5 year SWAP) • we use floating interest rates as a natural hedge • decoupling of Euribor and money market in 2008 due to bankin
Slide 21: Debt facilities & repayment schedule
debt facilities & repayment schedule repayment schedule 1800 revolver term cash dec 08 135 1600 1400 1200 € x million 1000 ~1.4 800 billion 831 600 400 200 135 135 135 135 135 135 135 0 - 09 -1 0 - 10 -1 1 - 11 -1 2 - 12 -1 3 08 n ov ay n ov ay n ov ay n ov ay de c m m m m sh ca • no refinancing bef
Slide 22: Dividend policy
dividend policy • dividend policy updated in 2007 - aiming at consistent dividend growth over the cycle and a floor of € 1.25 - flexible pay out ratio: min. pay out 30% - max. pay out 60% - new policy better matched cash flow which is less volatile than profit • stress tested dividend payment in rel
Slide 23: Tax
tax • the reported effective tax rate amounted to -/-114% in 2008 vs. 28.7% in 2007. This is due to: - goodwill impairment of € 506 million (non tax deductible) - net tax gain of € 226 million in deferred taxes • the effective tax rate, adjusted for the one-offs mentioned above, is 23.2% for 2008 -
Slide 24: Managing through the cycle
managing through the cycle target result progress remarks FY 2008 on target - continuous market share gains most geographies - EBITA margin of 5 to 6% on average through 4.9% no normal the cycle, not below 4% in a normal downturn downturn - sound financial position: leverage ratio net debt str
Slide 25: Risk management
risk management priorities: • managing through the cycle - focus on revenue, gross margin and operating expenses • successful integration of Vedior • strong financial position and liquidity - focus on net debt, bank covenant, interest and working capital • compliance with relevant rules and regulati
Slide 26: Corporate sustainability policy
corporate sustainability policy • from times immemorial Randstad has been playing a central role in society growth model - finding suitable jobs for as much people as % of our people covered per indicator possible stakeholder - help stakeholders and share information to dialogue diversity take the H
Slide 27: 3a. Proposal to adopt the 2008 financial statements
3a. proposal to adopt the 2008 financial statements 27 31 March 2009 annual general meeting of shareholders 2009
Slide 28: 3b. Explanation of policy on reserves and dividends
3b. explanation of policy on reserves and dividends • dividend policy updated in 2007 - aiming at consistent dividend growth over the cycle and a floor of € 1.25 - flexible pay out ratio: min. pay out 30% - max. pay out 60% - new policy better matched cash flow which is less volatile than profit • s
Slide 29: 3c. Proposal to determine the dividend over the financial year 2008
3c. proposal to determine the dividend over the financial year 2008 dividend proposal: • no dividend on ordinary shares (2007: € 1.25) • € 0.284 on cumulative preferred shares (2007: € 0.284) • add remaining net profit of € 11 million to the reserves 29 31 March 2009 annual general meeting of shareh
Slide 30: 4a. Discharge of liability of the Executive Board
4a. discharge of liability of the members of the Executive Board for the management 30 31 March 2009 annual general meeting of shareholders 2009
Slide 31: 4b. Discharge of liability of the Supervisory Board
4b. discharge of liability of the members of the Supervisory Board for the supervision of the management 31 31 March 2009 annual general meeting of shareholders 2009
Slide 32: 5. Proposal to reappoint Mr. A.H.J. Risseeuw as director A
5. proposal to reappoint Mr. A.H.J. Risseeuw as director A of Stichting Administratie-kantoor Preferente Aandelen Randstad Holding • Dutch nationality • member of the Board since 1999 • born on November 9, 1936 • reappointment for a period of 4 years (2013) 32 31 March 2009 annual general meeting of
Slide 33: 6. Remuneration policy of the Executive Board (subdued)
6. remuneration policy of the Executive Board (subdued) • this proposal has been subdued with reference to the press release of Randstad Holding on March 17, 2009 33 31 March 2009 annual general meeting of shareholders 2009
Slide 34: 7a. Proposal to extend authority to issue shares
7a. proposal to extend the authority of the Executive Board to issue shares background: • valid for a period of 18 months (October 31, 2010) • approval by the Supervisory Board • actual yearly allocation of performance shares and options not more than 1% • yearly maximum authorisation of 3% of the i
Slide 35: 7b. Proposal to restrict or exclude pre-emptive rights
7b. proposal to extend the authority of the Executive Board to restrict or exclude the pre-emptive right to any issue of shares background: • valid for a period of 18 months (October 31, 2010) • approval by the Supervisory Board • yearly maximum authorisation of 3% of the issued capital in the form
Slide 36: 8. Proposal to reappoint PricewaterhouseCoopers as external auditor
8. proposal to reappoint PricewaterhouseCoopers as external auditor for the financial year 2009 and 2010 36 31 March 2009 annual general meeting of shareholders 2009
Slide 37: 9. Any other business
9. any other business 37 31 March 2009 annual general meeting of shareholders 2009
Slide 38: 10. Closing
10. closing 38 31 March 2009 annual general meeting of shareholders 2009