Slide 1: Results for the Year Ended 30 June 2015
For personal use only McPherson’s Limited Results for the Year Ended 30 June 2015 Paul Maguire – Managing Director Paul Witheridge – Chief Financial Officer 24 August 2015
Slide 2: MCP FY2015 Financial Overview
MCP FY2015 Financial Overview Overall Sales Revenue of $349.1m, 1.0% below prior year For personal use only Sales Revenue, excluding the partially divested Housewares business, of $318.2m, 15.3% above prior year Comparable sales, i.e. excluding FY2014 and FY2015 acquisitions and Housewares, gr
Slide 3: MCP FY2015 Financial Overview
MCP FY2015 Financial Overview Cash flow from operations before interest and tax payments of $19.5m, For personal use only 89% of EBITDA Net debt of $77.2m at 30 June 2015, $74.7m at 30 June 2014 Gearing ratio of 43.9% at 30 June 2015, 44.6% at 30 June 2014 EBIT Interest Cover1 of 3.6 times a
Slide 4: MCP FY2015 Financial Overview
MCP FY2015 Financial Overview Successful refinancing of debt at 31 March 2015 For personal use only $60m of Corporate Bonds issued comprising: – $30m, 4 year floating rate of 4.30% above BBSW – $30m, 6 year fixed rate of 7.10% New 2 year Working Capital Facility established with NAB & WBC Fu
Slide 5: Strategy Update
For personal use only Paul Maguire Managing Director STRATEGY UPDATE
Slide 6: Trading commentary
Trading commentary For personal use only Significant AUD/USD currency devaluation throughout FY2015 Raw material prices remained high until 4th Quarter FY2015 Volatility persists in currency and raw material markets McPherson’s profit impacted in 2H FY2015 by the requirement to supply privat
Slide 7: Divisional revenue summary (Aus & NZ)
Divisional revenue summary (Aus & NZ)# For personal use only SHARE OF REVENUE REVENUE GROWTH REASONS OUTLOOK FY2015 FY15 vs FY14 Growth in HEALTH Acquisitions & 45% 32%* revenue and & BEAUTY new agencies profit Growth in HOME Acquisition & 21% 12%** revenue and APPLIANCES new products profit HOUSEHO
Slide 8: Company transformation
Company transformation For personal use only McPherson’s stated strategy is: “to substantially transform through acquisition/divestment, the establishment of new agency partnerships and channel expansion .......diversifying away from margin constrained channels and increasing participation in channe
Slide 9: Company transformation timeline
Company transformation timeline Diversification achieved via acquisitions & new agencies For personal use only Divestment Acquisition McPherson’s Printing New Agency Demerger (Fine Fragrances) Acquisition New Agency Acquisition Feb Aug Mar Jul Oct Mar Apr Jun Jul Aug Nov 2012 2012 2013 2013 2013 201
Slide 10: Transformation progress
Transformation progress Over the past year we have… For personal use only ... acquired and successfully integrated two natural skincare & haircare brands (A’kin and Alchemy) delivering synergy benefits and growth ... partnered with Trilogy International to distribute the Trilogy brand ... partnered
Slide 11: Beauty acquisitions
Beauty acquisitions A’kin & Al’chemy For personal use only – Natural skincare (A’kin) and natural haircare (Al’chemy) – Leveraging MCP strengths – Significant growth potential 11
Slide 12: New beauty agency – natural skincare
New beauty agency – natural skincare For personal use only 12
Slide 13: New beauty agency – fine fragrances
New beauty agency – fine fragrances For personal use only 13
Slide 14: Housewares joint venture
Housewares joint venture For personal use only ‘McPherson’s Housewares’ joint venture established with FACKELMANN from Germany; (FMG 51% : MCP 49%) FACKELMANN is a global manufacturer and distributor of kitchen, baking, home & leisure products, operating 35 manufacturing & distribution centres g
Slide 15: Performance improvement initiatives
Performance improvement initiatives For personal use only Price increases implemented by all divisions late 2H FY2015 USD product cost reductions achieved by all divisions 2H FY2015 McPherson’s Australia – restructuring in Sydney distribution centre, field sales and administration 2H FY2015
Slide 16: Transformation Benefits
Transformation Benefits For personal use only Transforming through diversification reduces risk: – Lessened exposure to foreign exchange • USD purchases will reduce to 63% of total purchases in FY2015, down from 85% in FY2014 – A more profitable channel and customer mix • In FY2016 the mix of busi
Slide 17: Health and Beauty division
Health and Beauty division Current Status For personal use only Revenue 32% ahead of prior year Successful new products under trusted brands Acquisitions and new agencies boosting McPherson’s presence in Pharmacy and Department Stores and reaffirming McPherson’s beauty industry credentials: –
Slide 18: Home Appliances division
Home Appliances division Current Status For personal use only Home Appliances provides McPherson’s with customer and channel diversification - electrical retail, hardware and commercial Excellent supplier and customer network FY2015 was adversely affected by a depreciating AUD/USD exchange rat
Slide 19: Household Consumables division
Household Consumables division Current Status For personal use only Revenue 7% ahead of prior year Profit impacted by: – protracted negotiations prior to the acceptance of price increases – the requirement to supply low margin private label....now exited – increased ‘customer support’ required –
Slide 20: Housewares division
Housewares division Current Status For personal use only Joint venture performing to plan ‘New Zealand Housewares’ joined JV 1 July 2015 Range rationalisation and clearance complete, leading to overhead reductions and a focus on major brands Price increases implemented in 2H FY2015 Outlook
Slide 21: Outlook
Outlook For personal use only Retail trading conditions expected to remain consistent with the past year Financial performance across all divisions boosted by recent price increases, operational initiatives and reduced operational expenditure Health & Beauty to benefit from new products and ne
Slide 22: McPherson's Limited Results for the Year Ended 30 June 2015
MCPHERSON’S LIMITED RESULTS FOR THE For personal use only YEAR ENDED 30 JUNE 2015 Paul Maguire – Managing Director Paul Witheridge – Chief Financial Officer Mission To be a world class consumer products company through 1st choice products for consumers and by being a 1st choice partner for customers
Slide 23: Appendix: Financial Performance for the Year Ended 30 June 2015
Paul Witheridge For personal use only Chief Financial Officer APPENDIX MCPHERSON’S LIMITED FINANCIAL PERFORMANCE FOR THE YEAR ENDED 30 JUNE 2015
Slide 24: Group Financial Summary for FY2015 (Underlying)
Group Financial Summary for FY2015 Underlying (i.e. excluding significant non-recurring items) For personal use only June 2014 June 2015 ($A million) ($A million) Sales 352.7 349.1 1.0% Sales decrease EBITDA 29.5 25.2 Depreciation & amortisation (2.9) (2.7) EBIT 26.6 22.5 15.4% EBIT decrease Interes
Slide 25: Group Financial Summary for FY2015 (Statutory)
Group Financial Summary for FY2015 Statutory (i.e. including significant non-recurring items) For personal use only June 2014 June 2015 ($A million) ($A million) PBT excluding non-recurring items 20.0 16.4 Non-recurring items: - Interest rate swap termination loss - (2.0) - Contingent consideration
Slide 26: Overview of Group Balance Sheet
Overview of Group Balance Sheet For personal use only June 2014 June 2015 ($A million) ($A million) Inventories 45.5 57.8 Receivables 60.7 55.0 Assets held for sale (inventories) 26.1 19.7 Payables (50.6) (60.4) Net working capital 81.7 72.1 Property, plant & equipment 6.0 5.5 Investments (49% of Ho
Slide 27: Group Operating Cash Flows
Group Operating Cash Flows For personal use only June 2014 June 2015 ($A million) ($A million) cash flows from operations Receipts from customers (inclusive of GST) 379.1 382.8 Payments to suppliers and employees (inclusive of GST) (345.2) (363.3) Net cash inflows from operations before interest and
Slide 28: Group Investing and Financing Cash Flows
Group Investing and Financing Cash Flows For personal use only June 2014 June 2015 ($A million) ($A million) cash flows from investing activities Payments for purchase of property, plant and equipment (1.3) (2.0) Payments for acquisition of business assets (23.7) (8.1) Payments for purchase of intan
Slide 29: FX Hedging (Australia)
FX Hedging (Australia) Comprehensive FX hedging program in place using Options, Forward Exchange For personal use only Contracts (FECs) and Collars: Options Protect downside with premium cost but allow upside benefit FEC’s Fixed rate with lost forward points Collar Improved downside protection in ex
Slide 30: Non-IFRS measures and Disclaimer
McPherson’s Limited For personal use only Non-IFRS measures The non-IFRS measures used by the Company are relevant because they are consistent with measures used internally by management to assess the operating performance of the business. The non-IFRS measures have not been subject to audit or revi