Smurfit Westrock Plc · NYSE:SW
Smurfit Westrock — Smurfit Kappa Group — FY2023 Earnings Presentation
34 slides from Smurfit Westrock's earnings presentation, Feb 7, 2024
Slide 1: Consistently Delivering: 2023 Full Year Results
Consistently Delivering 2023 Full Year Results
Slide 2: Important Additional Information
Important Additional Information Neither this announcement nor any copy of it may be taken or transmitted directly or indirectly into or from any jurisdiction where to do so would constitute a violation of the relevant laws or regulations of such jurisdiction. Any failure to comply with this restric
Slide 3: Participants in the Solicitation of Proxies
This document is for informational purposes only and is not intended to, and shall not, constitute an offer to sell or buy or the solicitation of an offer to sell or buy any securities, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be u
Slide 4: Forward-looking statements
Forward-looking statements are based upon current plans, estimates and expectations that are subject to risks, uncertainties and assumptions. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from thos
Slide 5: Forward-looking statements (continued)
The forward-looking statements in this document do not constitute reports or statements published in compliance with any of Regulations 6 to 8 of the Transparency (Directive 2004/109/EC) Regulations 2007. Nothing in this document should be construed as a profit estimate or profit forecast. No statem
Slide 6: Today's presenters
Today’s presenters Laurent Sellier Tony Smurfit Ken Bowles Saverio Mayer CEO SK The Americas since 2021. Group CEO since 2015 Group CFO since 2016 CEO SK Europe since 2017 Previously COO SK Europe 6
Slide 7: Introduction
~) Smurfit Kao Introduction
Slide 8: A globally admired business, dynamically and sustainably delivering returns
A globally admired business, dynamically and sustainably delivering secure and superior returns for all stakeholders 8
Slide 9: Capital Allocation 2015-2023
Capital Allocation 2015 - 2023 €10.3 billion €6 billion €2.2 billion €1.8 billion Pre-capex free cash flow Organic investment in the Distributed in dividends Spent on acquisitions business 9
Slide 10: Consistent delivery
Consistent delivery EBITDA EBITDA Margin ROCE Dividend 2015 2023 2015 2023 2015 2023 2015 2023 +76% +390bps +230bps +123% Investment grade credit rating 10
Slide 11: Delivering for our People
Delivering for our People Growing our People - Growing our Business People at the core. Attracting, developing and retaining the next generation of talent for the Group. Creating exciting local and global development career opportunities for our people to grow Developing our People – For the Future
Slide 12: Announced WestRock combination
Announced WestRock combination The largest listed global packaging business by sales Two complementary business with strong cultural fit A global leader in sustainable packaging Unparalleled geographic reach across 42 countries Broader opportunities for approximately 100,000 employees Improved opera
Slide 13: Financials
“\ Smurfit Kappa Financials 13 Creating the future together
Slide 14: Full Year 2023 Financial Highlights
Full Year 2023 Financial Highlights €11.3 €2,080 18.5% 17.1% €628 1.4x +10% billion million million EBITDA Net Debt Final Revenue EBITDA ROCE FCF Margin /EBITDA Dividend 14
Slide 15: Effective Capital allocation
Effective Capital allocation Driving and delivering current and future success Capital Expenditure Dividend M&A Balance Sheet Other shareholder returns Growth, efficiency, Progressive policy Disciplined approach Investment grade Selective when other integration & 1.5x – 2x capital allocation Key com
Slide 16: Sustainability
Sustainability Latest Headlines Announced in the first cohort of Early Adopters by the Taskforce on Nature-related Financial Disclosures (TNFD) Ranked 1st by Morningstar Sustainalytics in Paper Packaging while also once again obtaining both Industry and Regional Top-rated badges Installation of 12,0
Slide 17: Process through to completion for WestRock Combination
Process through to completion for WestRock Combination Progress as expected Mobilisation and organisational Post- Integration planning Detailed pre-close planning understanding close Preparation of Prospectus & Circular, S-4 FCA & SEC Clearance by FCA & SEC 3 year audited historical financials Finan
Slide 18: Smurfit Kappa Europe
Smurfit Kappa Europe Creating the future together
Slide 19: Smurfit Kappa Europe operations
Smurfit Kappa Europe 258 operations across 23 countries • no. 1 in Corrugated – >180 facilities producing approx. 9 billion sqm • no. 1 in Recycled Paper & Board1 – 18 mills producing 4.3 million tonnes • no. 1 in Kraftliner2 – 3 mills producing 1.6 million tonnes • no. 1 in Bag-in-Box, 8 plants • >
Slide 20: 2023 Highlights
2023 Highlights EBITDA EBITDA Record low margin PPM and €1.6 highest OTIF billion 18.8% 12 Morocco Top Supplier WorldStar Plant Opening Award Awards 20
Slide 21: Co-create faster, test smarter!
No formal customer permission Co-create faster, test smarter ! • Innovative facility allowing testing on a small scale before market launch • Implementation in a record time (in just two weeks) • High engagement across the entire customer portfolio – More than 50 projects completed in 2023 • Expansi
Slide 22: Packaging that leaves no trace
Packaging that leaves no trace • Sustainability as a key trend for major brands – Change in consumer habits towards circular economy – Supportive regulation • More than 100 new solutions implemented in 2023 • Over 4,000 customers attended Better Planet Packaging days across 15 countries 22
Slide 23: Smurfit Kappa The Americas
Smurfit Kappa The Americas 23
Slide 24: SKTA | Breadth of Our Operations
SKTA | Breadth of North America 4,600 Our Operations 2 PMs 11 Box Plants 1 Folding Cartons Plant Experience Mexico 4,300 Center 5 PMs 8 Box Plants 3 Folding Cartons Plants 3 Experience Market Center Position* *Estimates based on public market data. Brazil 2,100 Central Cluster 4,300 The Americas 16,
Slide 25: Full Year Highlights – Americas
Full Year Highlights – Americas The only significant Pan American player Significant EBITDA EBITDA Margin organic €557 20.1% investment million delivering 25
Slide 26: SKTA | The Continents of Opportunities
Record SKTA | The Continents of Opportunities EBITDA North America One of the largest integrated Pan-American players in the region, with a strong presence in most countries and Mexico substantial opportunities for further growth. Colombia The Americas offer strong growth potential fueled by domesti
Slide 27: SKTA | The Partner of Choice for All Stakeholders
SKTA | The Partner of Choice for All Stakeholders Fit-For-Purpose Business Partners Offering integrated packaging solutions ranging from the fullest range of corrugated solutions to folding cartons, molded pulp, and hexacomb. Customer Centric Approach Innovation and value selling philosophy to bette
Slide 28: Summary and Conclusion
Summary and Conclusion 28 Creating the future together
Slide 29: Effective capital allocation
Effective capital allocation 17.1% ROCE +230bps 14.8% 18.5% EBITDA Margin 2015 2023 14.6% +390bps €2,080m EBITDA 2015 2023 +76% €1,182m 2015 2023 29
Slide 30: Our 2023 results again demonstrate proven capacity to perform
“Our 2023 results again demonstrate Smurfit Kappa Group’s proven capacity to perform across all market conditions” 30
Slide 31: Appendix
Sax Appendix 31 Creating the future together
Slide 32: Technical guidance
Technical guidance • Cash interest €120m • Cash tax €280m • Working capital as a % of sales 7-8% • Effective tax rate 26% • Impact of US$ 1c move on EBITDA €5m • Capital Expenditure €900m 32
Slide 33: Our purpose
Our purpose Create Protect Care 33
Slide 34: Thank you
Sax Thank you 34 Creating the future together