Slide 1: Welcome to the Full-Year Results Conference
Welcome to the Full-Year Results Conference
Slide 2: Disclaimer
Disclaimer This presentation contains forward looking statements which reflect Management’s current views and estimates. The forward looking statements involve certain risks and uncertainties that could cause actual results to differ materially from those contained in the forward looking statements.
Slide 3: Full-Year Results Conference – Paul Bulcke, Nestlé CEO
Full-Year Results Conference Paul Bulcke Nestlé CEO
Slide 4: Full-Year 2015
Full-Year 2015 Sales Organic Real Trading Growth Internal Growth Operating Profit Margin CHF + 10 bps 88.8 bn 4.2% 2.2% in constant currencies 4 18 February 2016 Nestlé Full-Year Results 2015
Slide 5: Full-Year Results 2015 – François-Xavier Roger, CFO
Full-Year Results 2015 François-Xavier Roger Chief Financial Officer
Slide 6: Profitable Growth in Challenging Markets
Profitable Growth in Challenging Markets Focus on Cash Flow and Shareholder Return Organic Trading Free Underlying Growth Operating Profit* Cash Flow Earnings Per Share* 11.2% + 4.2% + 10 bps + 6.5% of sales *in constant currency 6 18 February 2016 Nestlé Full-Year Results 2015
Slide 7: Broad-based Organic Growth in all Geographies
Broad-based Organic Growth in all Geographies AMS EMENA AOA Sales 39.1 bn 27.5 bn 22.2 bn (in CHF) RIG +2.4% +2.8% +1.2% OG +5.8% +3.5% +1.9% Each region includes Zones, Nestlé Waters, Nestlé Nutrition, Nestlé Professional, Nespresso, Nestlé Health Science, and Nestlé Skin Health 7 18 February 2016
Slide 8: Developed and Emerging Markets Growth
Developed and Emerging Markets Growth Developed Emerging Sales (in CHF) 51.0 bn 37.8 bn % of Group sales 57% 43% Organic Growth +1.9% +7.0% Organic Growth - 2014 +1.1% +8.9% 8 18 February 2016 Nestlé Full-Year Results 2015
Slide 9: Zone AMS
Zone AMS Sales: CHF 25.8 bn Trading Operating Profit FY 2015 RIG % 1.6 OG % 5.5 TOP % 19.4 vs. LY1 +80 bps Market share gains Acceleration in North America – U.S. frozen turn-around – Coffee-mate, Ice cream, and Petcare had good momentum Latin America had good growth and some inflationary pres
Slide 10: Zone EMENA
Zone EMENA Sales: CHF 16.4 bn Trading Operating Profit FY 2015 RIG % 2.5 OG % 3.7 TOP % 15.7 vs. LY1 +50 bps Broad-based market share gains Highlights: Nescafé Dolce Gusto & soluble coffee, Petcare, Pizza Western Europe – Positive volume-driven growth, despite deflationary environment – France
Slide 11: Zone AOA
Zone AOA Sales: CHF 14.3 bn Trading Operating Profit FY 2015 RIG % -0.1 OG % 0.5 TOP % 18.4 vs. LY1 -80 bps Growth improving, but was impacted by India Emerging markets – China improved, with good performance in Nescafé and confectionery; Yinlu recovery ongoing – India was challenged by Maggi ca
Slide 12: Nestlé Waters
Nestlé Waters Sales: CHF 7.6 bn Trading Operating Profit FY 2015 RIG % 6.7 OG % 6.7 TOP % 10.8 vs. LY +110 bps Good growth momentum across geographies and brands Nestlé Pure Life had double-digit growth Premium brands S. Pellegrino and Perrier had high-single digit growth Local brands contin
Slide 13: Nestlé Nutrition
Nestlé Nutrition Sales: CHF 10.5 bn Trading Operating Profit FY 2015 RIG % 1.4 OG % 3.1 TOP % 22.6 vs. LY1 +110 bps Solid organic growth with accelerating RIG, but – Difficult comparisons in Asia – Headwinds in some volatile markets (Middle East, Russia, Brazil) – Lower contribution from pricing
Slide 14: Other Businesses
Other Businesses Sales: CHF 14.1 bn Trading Operating Profit FY 2015 RIG % 3.7 OG % 5.3 TOP % 15.7 vs. LY1 -330 bps Nestlé Professional Emerging markets drove growth Davigel divestment completed in November as part of portfolio management Nespresso Solid growth across all regions Innovation
Slide 15: Broad-based growth across product groups
Broad-based growth across product groups % Real8.0Internal Growth % Pricing 7.0 7.0 6.2 5.9 6.0 5.4 5.0 4.2 4.4 2.4 2.3 4.0 4.4 7.0 2.1 3.0 2.0 2.0 1.7 3.1 3.5 0.4 0.1 1.0 2.2 2.3 1.8 1.3 1.4 0.0 0.0 -1.0 -1.3 -2.0 TOTAL GROUP Powdered and Water Milk products and Nutrition and Prepared dishes Confec
Slide 16: Cost benefits reinvested for growth
Cost benefits reinvested for growth +160 bps -170 bps +20 bps -30 bps 15.3% 15.4% 15.1% +10 bps TOP COGS & Marketing, Other* TOP Currency TOP FY 2014 Distribution* Administration, FY 2015* impact FY 2015 R&D* *in constant currency 16 18 February 2016 Nestlé Full-Year Results 2015
Slide 17: Underlying EPS +6.5% in constant currency
Underlying EPS +6.5% in constant currency Total Group FY 2014 FY 2015 Difference in CHF bn % of sales % of sales bps Trading operating profit 15.3 15.1 -20 Net other operating income/expenses (3.4) (1.1) 230 Net financial income/expenses (0.7) (0.7) - Taxes (3.7) (3.7) - Income from associates and J
Slide 18: Consistent industry-leading free cash flow generation
Consistent industry-leading free cash flow generation Free cash flow as a % of sales 13.0% 12.5% 12.0% 11.5% 11.0% 11.2% 10.5% 11.0% 10.9% 10.0% 10.2% 9.5% 9.0% 2012 2013* 2014** 2015 *Adjusted for exceptional income due to Givaudan disposal (CHF 1.1 bn) **Adjusted for exceptional income due to L’Or
Slide 19: Continued focus on working capital
Continued focus on working capital Average working capital as a % of sales 9.0% 8.0% 8.5% 7.0% 6.0% 6.5% 5.0% 5.3% 4.0% 4.7% 3.0% 2.0% 1.0% 0.0% 2012 2013 2014 2015 19 18 February 2016 Nestlé Full-Year Results 2015
Slide 20: Capex discipline while supporting growth
Capex discipline while supporting growth Capex as a % of sales 8.0 7.0 6.0% 5.9% 6.0 5.3% 5.0 4.3% 4.4% 4.0 3.0 2.0 1.0% 2012* 2013 2014 2015 *Restated following implementation of IFRS 11 and IAS 19 20 18 February 2016 Nestlé Full-Year Results 2015
Slide 21: CHF 13.4 bn cash returns to shareholders
CHF 13.4 bn cash returns to shareholders In CHF bn -0.3 +0.7 -6.9 +9.9 -6.5 -15.4 -12.3 CHF 13.4 bn returned to shareholders Net Debt Share Buy-Back Dividends M&A FX & Other Free Cash Net debt 31 Dec 2014 (net) Flow 31 Dec 2015 21 18 February 2016 Nestlé Full-Year Results 2015
Slide 22: Summary
Summary Organic growth at high end of industry ̶ Acceleration of Real Internal Growth ̶ Declining Pricing benefits Superior and profitable growth in challenging environment Reinvestment of savings and cost efficiencies to support growth Focus on sustainable Cash Flow generation Strong Bala
Slide 23: Guidance 2016
Guidance 2016 We expect to deliver organic growth in line with 2015, with improvements in margins and underlying earnings per share in constant currencies, and capital efficiency. 23 18 February 2016 Nestlé Full-Year Results 2015
Slide 24: Full-Year Results Conference – Paul Bulcke, Nestlé CEO
Full-Year Results Conference Paul Bulcke Nestlé CEO
Slide 25: Continue building our brands
Continue building our brands 25 18 February 2016 Nestlé Full-Year Results 2015
Slide 26: Continue building our brands
Continue building our brands 26 18 February 2016 Nestlé Full-Year Results 2015
Slide 27: Continue building our brands
Continue building our brands 27 18 February 2016 Nestlé Full-Year Results 2015
Slide 28: Continue building our brands
Continue building our brands 28 18 February 2016 Nestlé Full-Year Results 2015
Slide 29: A unique position in coffee
A unique position in coffee 29 18 February 2016 Nestlé Full-Year Results 2015
Slide 30: USA: frozen food
USA: frozen food 30 18 February 2016 Nestlé Full-Year Results 2015
Slide 31: China: growth market
China: growth market 31 18 February 2016 Nestlé Full-Year Results 2015
Slide 32: Digital engagement
Digital engagement Digital marketing eBusiness: capabilities to accelerate growth Dedicated eBusiness team Inspiring & Listening Engaging Transforming Strategy & Plans to support each market Strategic alliances 32 18 February 2016 Nestlé Full-Year Results 2015
Slide 33: Continuous cost awareness
Continuous cost awareness 33 18 February 2016 Nestlé Full-Year Results 2015
Slide 34: 18 February 2016 Nestlé Full-Year Results 2015
34 18 February 2016 Nestlé Full-Year Results 2015
Slide 35: 18 February 2016 Nestlé Full-Year Results 2015
35 18 February 2016 Nestlé Full-Year Results 2015
Slide 36: Full Year Results Appendix
Full Year Results Appendix 36 18 February 2016 Nestlé Full-Year Results 2015
Slide 37: Operating Segments
8.0 Operating Segments 7.0 6.7 % Real Internal Growth % Pricing 6.0 5.5 5.3 5.0 4.2 1.6 4.0 3.7 3.1 3.9 2.0 6.7 3.0 1.2 1.7 2.0 3.7 2.2 2.5 1.0 1.6 0.5 1.4 0.6 0.0 -0.1 0.0 -1.0 TOTAL Zone Zone Zone Nestlé Nestlé Other GROUP AMS EMENA AOA Waters Nutrition Businesses Trading Operating 15.1% 19.4% 15.
Slide 38: Currency Overview
Currency Overview Weighted average rate FY 2014 FY 2015 Variation US Dollar 1 USD 0.92 0.96 +5.1% Euro 1 EUR 1.22 1.07 -12.1% Chinese Yuan Renminbi 100 CNY 14.88 15.32 +3.0% Brazilian Reais 100 BRL 38.90 29.00 -25.4% UK Pound Sterling 1 GBP 1.51 1.47 -2.3% Mexican Pesos 100 MXN 6.88 6.07 -11.8% Phil
Slide 39: FX Impact
FX Impact FX Impact FY 2015 Zone AMS -8.1% Zone EMENA -12.2% Zone AOA -3.1% Nestlé Waters -1.8% Nestlé Nutrition -6.0% Other Businesses -8.2% Total -7.4% 39 18 February 2016 Nestlé Full-Year Results 2015
Slide 40: Glossary & Footnotes
Glossary & Footnotes Notes 1 2014 figures have been restated on the following main transfers, effective as from 1 January 2015: the Maghreb, the Middle East, the North East Africa region, Turkey and Israel in Zone Asia, Oceania and Africa to Zone Europe; Growing-Up Milks business in the geograph