Slide 1: Full Year Results
FULL YEAR RESULTS FEBRUARY 24TH, 2021
Slide 2: Forward-Looking Statements
FORWARD-LOOKING STATEMENTS This Presentation may include forward-looking statements. Forward-looking statements are statements regarding or based upon our management’s current intentions, beliefs or expectations relating to, among other things, Ontex’s future results of operations, financial conditi
Slide 3: Agenda
Agenda Introduction & Where We Stand 2020 2020 Financial & Our Priorities Financial 2021 Highlights for the Future Review Outlook Q&A 2020 Annual Results – February 24th 2021 3
Slide 4: 2020 Financial Highlights
2020 FINANCIAL HIGHLIGHTS Revenue down 8.5% vs €2,281m in 2019 REVENUE €2,087m LFL revenue down 3.1% All regions posted declining revenues, Europe -6.8% LFL where we have lost share and are under-exposed to e-commerce Adjusted EBITDA down 3.9% vs €245m in 2019 ADJUSTED EBITDA €236m Adjusted EBITDA m
Slide 5: Where We Stand and Our Priorities for the Future
WHERE WE STAND AND OUR PRIORITIES FOR THE FUTURE Esther Berrozpe 2020 Annual Results – February 24th 2021 5
Slide 6: Who We Are / Our Purpose
WHO WE ARE Personal Hygiene and Health solutions to help people during major changes in their lives Deeply rooted in local markets, we offer affordable products and services to the communities we serve What differentiates us is our accessibility and proximity and our approach to locally driven OUR P
Slide 7: Our Position Today
OUR POSITION TODAY ONTEX REVENUE SPLIT (2020) CATEGORIES OWN VS. RETAILER BRANDS GEOGRAPHIES 2% 10% 35% 46% 54% 33% 56% 65% Baby Care Feminine Care Retailer brands Emerging Markets Inco Other Own brands Developed Markets 2020 Annual Results – February 24th 2021 7
Slide 8: Demographic and Consumer Trends Drive Category Growth
DEMOGRAPHIC AND CONSUMER TRENDS DRIVE CATEGORY GROWTH SOCIO-DEMOGRAPHIC SHIFTS IN SHOPPER UNDERLYING TRENDS AND CONSUMER BEHAVIOURS Demographics growth Smart choices Convenience Ageing population Lifestyle brands Homecare Economic development E-commerce Sustainability 2020 Annual Results – February
Slide 9: Resulting in Volume and Value Growth Opportunities
RESULTING IN VOLUME AND VALUE GROWTH OPPORTUNITIES Growing number … with increasing … and innovation of users… usage of products… to drive value Per capita daily/monthly consumption 2020* ~Flat Baby pants: 95% of value growth, price 5 4 3 index vs. diapers at >120 number of babies 1 Natural and sust
Slide 10: We Are Well Positioned in Our Core Markets
WE ARE WELL POSITIONED IN OUR CORE MARKETS LEADERSHIP IN RETAILER BRANDS IN EUROPE STRONG BRANDS IN HEALTHCARE IN EUROPE 2.0x 3.5x 2.8x Italy #1 Ontex UK #2 #2 Belgium #2 France #3 Germany #5 Spain #5 Baby Care Adult Care Feminine Care Estimated share in Europe Retailer Brands and delta towards #2 p
Slide 11: We Have Strong Capabilities to Build On
WE HAVE STRONG CAPABILITIES TO BUILD ON DEEP BUSINESS STRONG INDUSTRIAL UNDERSTANDING FOOTPRINT FLEXIBILITY TO EXPERIENCED & DELIVER CUSTOMER ENGAGED TEAM DIFFERENTIATION 2020 Annual Results – February 24th 2021 11
Slide 12: We Need to Solve Important Challenges
WE NEED TO SOLVE IMPORTANT CHALLENGES COMPLEXITY COST CUSTOMER FOCUS Expanded into multiple Not fully leveraging scale Slipped behind on service geographies, categories and level & innovation cadence go-to-market models Silo approach not allowing full optimization of operating Slow response to custo
Slide 13: Strategic Priorities to Restore Profitable Growth
WE HAVE SET STRATEGIC PRIORITIES TO RESTORE PROFITABLE GROWTH PORTFOLIO CUSTOMER PRODUCT OPERATIONAL FOCUS CENTRICITY INNOVATION EXCELLENCE Simplify the business Strengthen Accelerate Improve cost & product portfolio customer relations cadence of competitiveness & restore growth innovation & service
Slide 14: Simplify the Business & Product Portfolio
SIMPLIFY THE BUSINESS & PRODUCT PORTFOLIO PORTFOLIO FOCUS Review geography and brand portfolio to define the future strategic role of each of our Developing Markets Reduce product portfolio complexity leveraging common platforms Define the long-term business model for D2C 2020 Annual Results – Febru
Slide 15: Strengthen Customer Relations and Restore Growth
STRENGTHEN CUSTOMER RELATIONS AND RESTORE GROWTH CUSTOMER CENTRICITY Recover share in Europe by rebuilding trustworthy relationships and fixing recent service and competitiveness issues Continue to grow our customer base in North America, leveraging local supply Increase focus on Adult Care and Baby
Slide 16: Accelerate Cadence of Innovation
ACCELERATE CADENCE OF INNOVATION PRODUCT INNOVATION Synergize platforms across our Retailer and Own Brands to optimize investments Enhance collaboration with customers and suppliers to strengthen our innovation cadence Leverage our proximity to “lifestyle brands” to innovate on leading consumer tren
Slide 17: Improve Cost Competitiveness and Service Levels
IMPROVE COST COMPETITIVENESS AND SERVICE LEVELS OPERATIONAL EXCELLENCE Further leverage scale and structurally drive productivity end-to-end along the value chain Reduce inventories while improving customer service levels Accelerate manufacturing transformation through portfolio simplification 2020
Slide 18: Set Clear Goals & Roadmap for Environmental and Social Commitments
SET CLEAR GOALS & ROADMAP FOR OUR ENVIRONMENTAL AND SOCIAL COMMITMENTS ENVIRONMENT AND SOCIAL Aim for carbon neutral operations Progressing towards a circular business model Source responsibly and enhance transparency in product composition Strive for zero accidents Promote diversity and equality
Slide 19: Transform the Ontex Culture
TRANSFORM THE ONTEX CULTURE ORGANIZATION & CULTURE Simplify the organization Streamline decision making and accelerate speed of execution Embed accountability at every level in the organization Drive performance culture Strengthen our talent pipeline and continue to drive engagement 2020 Annual Resu
Slide 20: 2020 Financial Review
2020 FINANCIAL REVIEW Charles Desmartis 2020 Annual Results – February 24th 2021 20
Slide 21: FY LFL Revenue Down 3.1% on Lower Retail Demand
FY LFL REVENUE DOWN 3.1% ON LOWER DEMAND FROM RETAIL CUSTOMERS, DOWNTURN IN EMERGING MARKETS Group revenue review FY 2020 Sales bridge (€m) -8.5% FY 2020 LFL revenue: €2,211 million, -3.1% reported Top-line drivers -3.1% LFL Volumes lower due to: 2,281 ‐ Lower demand from Q2 onwards reflecting less
Slide 22: Category Review: Baby Care Most Impacted, Adult Care Growing
CATEGORY REVIEW: BABY CARE MOST IMPACTED, ADULT CARE GROWING ACROSS ALL GEOGRAPHIES FY 2020 Baby Care reported revenue: €1,163 million, -7.1% LFL LFL sales growth Q1 surge followed by demand contraction: ‐ shift to online channels where our retail customers are less present ‐ lower demand in several
Slide 23: Europe: Sales Down on Lower Retail Demand
EUROPE: SALES DOWN ON LOWER DEMAND FROM RETAIL CUSTOMERS MAINLY DUE TO SHIFT TO E-COMMERCE, CONTRACT LOSSES Volume decrease, price/mix edged lower Europe (42% of Group revenue) Revenue (€m) and evolution (LFL and reported) FY 2020 LFL revenue: €892 million, -6.8% Demand contracted at retail customer
Slide 24: Americas, Middle East, Africa and Asia: LFL Sales Broadly Flat
AMERICAS, MIDDLE EAST, AFRICA AND ASIA: LFL SALES BROADLY FLAT WITH CONTRASTING REGIONAL TRENDS, STRONG CURRENCY HEADWINDS Q4 2020 LFL down 4.0% AMEAA (37% of Group revenue) Lower demand, intense competition in Mexico and MEAA Revenue (€m) and evolution (LFL and reported) outweighing growth in Brazi
Slide 25: Healthcare: Stable Revenue
HEALTHCARE: STABLE REVENUE AS SELF-PAY CHANNELS AND ECOMMERCE OFFSET LOWER DEMAND IN HOSPITALS AND NURSING HOMES DUE TO COVID Q4 2020 LFL up 6.2% Healthcare (21% of Group revenue) Deliveries to a large institution, suspended in Q4 2019, resumed in Revenue (€m) and evolution (LFL and reported) Q2 202
Slide 26: Adjusted EBITDA: €236M, Reported Margin at 11.3%
ADJUSTED EBITDA: €236M, REPORTED MARGIN AT 11.3%, UP 55 BPS PROCUREMENT GAINS AND LOWER RAW MATERIAL INDICES OFFSET BY LOW VOLUMES, HIGHER COSTS, UNFAVOURABLE CURRENCIES Full Year 2020 Adjusted EBITDA bridge (€ million) 14.0% T2G impact: €66m 45 -26 margin -5 -14 -6 -2 10.7% 80 -74 11.3% margin marg
Slide 27: Non-Recurring Expenses: -€38M, T2G Costs Forecast Cut
NON-RECURRING EXPENSES: -€38M, DOWN 46% VS. 2019 T2G FULL IMPLEMENTATION COSTS FORECAST CUT BY €25M TO €60M FY 2020 Non-recurring expenses Non-recurring expenses, net FY 2020 FY 2019 Change Main items are related to reduction of overheads costs, (notably the In millions € measures implemented in Q4
Slide 28: Free Cash Flow of €60 Million
FREE CASH FLOW OF €60 MILLION FY 2020 Free Cash Flow FY 2020 FY 2019 Change In millions € Free cash flow: €60 million vs. €110m in 2019 from lower net cash generated from operating activities, down €48m at €191m (A), Adjusted EBITDA (B) 236 245 -10 reflecting: Non-recurring income and expenses (C) -
Slide 29: 2021 Outlook
2021 OUTLOOK Esther Berrozpe 2020 Annual Results – February 24th 2021 29 29
Slide 30: 2021 Outlook
2021 OUTLOOK Based on current visibility, we expect a The immediate focus is to turn our low double digit decrease of Group LFL strategic priorities into deliverable revenue in Q1 against a high action plans in a context of increasing comparable basis in 2020, with raw material prices. We will provi
Slide 31: Clear Priorities Set Towards Restoring Shareholder Value Creation
Clear priorities set towards restoring shareholder value creation 2020 Annual Results – February 24th 2021 31