Greif Inc. · NYSE:GEF
Greif — Investor Presentation (April 2020)
46 slides from Greif's investor presentation, April 2020
Slide 1: April 2020 Investor Presentation
April 2020 Investor Presentation
Slide 2: Safe harbor
Safe harbor FORWARD-LOOKING STATEMENTS • This presentation contains certain forward-looking information within the meaning of the Private Securities Litigation Reform Act of 1995. The words “may,” “will,” “expect,” “intend,” “estimate,” “anticipate,” “aspiration,” “objective,” “project,” “believe,”
Slide 3: Who we are
GREIF “"" PACKAGING SUCCESS TOGETHER™ April 2020 — P.3
Slide 4: Leading industrial packaging solutions provider
Who we are How we operate Why invest in Greif? Business segment overview Appendix Leading industrial packaging solutions provider 2019 Performance ($M) Highlights and capabilities Differentiations Revenue $4,595.0 • Leading product positions in • Demonstrated commitment to multiple packaging substra
Slide 5: Leading positions in multiple packaging substrates
Who we are How we operate Why invest in Greif? Business segment overview Appendix Leading positions in multiple packaging substrates Upstream Operations Industrial Packaging Steel Industrial Fibre Flexible IBCs #2 Closures Uncoated Recycled Paperboard (URB) #3 #1 #1 #1 #1 Coated Recycled Paperboard
Slide 6: Record Fiscal Year (FY) 2019 performance
Who we are How we operate Why invest in Greif? Business segment overview Appendix Record Fiscal Year (FY) 2019 performance Net Sales Adj. EBITDA1 Adj. EBITDA Adjusted EPS1 Adjusted Free +18.6% to +30.9% to Margin +12.2% to Cash Flow2 $4,595M $658.9M +130BP to $3.96 +50.0% to 14.3% $267.8M Notable ac
Slide 7: How we operate
How we operate April 2020 – P.7
Slide 8: Our values and behaviors
Who we are How we operate Why invest in Greif? Business segment overview Appendix Our values and behaviors Values Behaviors Communicate with respect, candor, and trust Think Act with the Greif mindset of a first champion Model the behaviors of a servant leader April 2020 – P.8
Slide 9: What we do for customers
Who we are How we operate Why invest in Greif? Business segment overview Appendix What we do for customers Exceed their expectations with customer Protect their Enhance their service, products sustainability flexibility, and innovations • Leverage our diverse geographic • Offer sustainable solutions
Slide 10: A clear vision with strategic priorities in place
Who we are How we operate Why invest in Greif? Business segment overview Appendix A clear vision with strategic priorities in place Strategic In industrial packaging, be the best performing Vision customer service company in the world 1 Engaged Teams 2 Differentiated Customer Service 3 Enhanced Perf
Slide 11: Strategic priority: engaged teams
Who we are How we operate Why invest in Greif? Business segment overview Appendix 1 Strategic priority: engaged teams Teams in the top quartile of those Gallup1 has Gallup Overall Engagement Score studied have… 21% Higher profitability 4.0 Manufacturing sector 3.97 percentile ranking 17% Higher prod
Slide 12: Strategic priority: differentiated customer service
Who we are How we operate Why invest in Greif? Business segment overview Appendix 2 Strategic priority: differentiated customer service Customer Satisfaction Index (CSI) Net Promoter Score (NPS) 100 Net Promoter Wave 9 Score 90 6 26 67 = 61 80 70 60 Wave 1 50 11 38 51 = 40 40 30 Detractors Passive P
Slide 13: Strategic priority: enhanced financial performance
Who we are How we operate Why invest in Greif? Business segment overview Appendix 3 Strategic priority: enhanced financial performance Net Sales ($ Millions) Adj. EBITDA ($ Millions) $5,000 $700 $4,600 6.2% 13.8% $4,200 $500 $3,800 $3,400 $3,000 $300 FY15 FY19 CAGR FY15 FY19 ‘15-’19 Adj. EPS ($/sh)
Slide 14: Strategic priority: enhanced financial performance
Who we are How we operate Why invest in Greif? Business segment overview Appendix 3 Strategic priority: enhanced financial performance Anticipated synergy over 36 months ($M) Caraustar run-rate synergy detail $75 $70 Transport / Logistics $65 Procurement / $60 Materials Operational $55 Enhancements
Slide 15: Strategic priority: enhanced sustainability performance
Who we are How we operate Why invest in Greif? Business segment overview Appendix 3 Strategic priority: enhanced sustainability performance 2016 2018 Join UN Global Achieved an 2019 Compact “A- Leadership” Achieved an “A” 2017 CDP score MSCI ESG rating Sustainability goals established 2015 2016 2017
Slide 16: Why invest in Greif?
Why invest in Greif? April 2020 – P.16
Slide 17: Global trends support Greif's future growth
Who we are How we operate Why invest in Greif? Business segment overview Appendix Global trends support Greif’s future growth Trend Comments Growth of economies and rise of the • Emerging economies are driving greater consumption middle class of products, goods and infrastructure Growing influence o
Slide 18: Advancing low risk growth priorities close to our core
Who we are How we operate Why invest in Greif? Business segment overview Appendix Advancing low risk growth priorities close to our core IBC and IBC reconditioning Containerboard integration • Organic IBC investments completed at • New Palmyra, PA sheet feeder enhances Houston, Spain and Russia to e
Slide 19: Track record of delivering on stated outlook
Who we are How we operate Why invest in Greif? Business segment overview Appendix Track record of delivering on stated outlook Adjusted Class A Earnings Per Share: guidance provided versus actual results $4.00 $3.50 $3.00 $2.50 $2.00 $1.50 Q2 Q3 ACT Beg Q1 Q2 Q3 ACT Beg Q1 Q2 Q3 ACT Beg Q1 Q2 Q3 ACT
Slide 20: Clear capital allocation priorities in place
Who we are How we operate Why invest in Greif? Business segment overview Appendix Clear capital allocation priorities in place 1 Reinvest in • Fund maintenance to sustain cash generation and advance organic growth the business opportunities that exceed required returns 2 De-lever the balance • Curre
Slide 21: Potential for significant interest savings in 2021
Who we are How we operate Why invest in Greif? Business segment overview Appendix Potential for significant interest savings in 2021 Debt maturities as of 1/31/2020 ($M) $1,600 Key liquidity statistics • Covenant net debt to EBITDA requirement = $1,400 4.75x; GEF currently 3.7x (Q1’20) • ~70% of deb
Slide 22: Management insiders have purchased shares
Who we are How we operate Why invest in Greif? Business segment overview Appendix Management insiders have purchased shares Since December 2019, during open window opportunities Position # of shares purchased on open market CEO 25,000 CFO 14,670 Other Section 16 officers 9,972 Management has “skin i
Slide 23: Anticipate significant EBITDA and FCF Expansion
Who we are How we operate Why invest in Greif? Business segment overview Appendix Anticipate significant EBITDA and FCF Expansion FY’22 Adj. FY’22 Adj. Free Path to 2022 Adjusted EBITDA ($M) $M EBITDA1 Cash Flow2 $1,000 RIPS $288 – $315 $820 - $900 $800 PPS $490 – $530 $600 $503.2 FPS $30 – $40 $400
Slide 24: Why invest in Greif?
Who we are How we operate Why invest in Greif? Business segment overview Appendix Why invest in Greif? We operate a defensible fleet We are committed to We are pursuing numerous We offer a compelling of global cash flowing customer service excellence avenues for incremental low- dividend and opportu
Slide 25: Appendix
GREIF PACKAGING SUCCESS TOGETHER™ Appendix
Slide 26: Business segment overview
Business segment overview April 2020 – P.26
Slide 27: RIPS: broad product and services capability
Who we are How we operate Why invest in Greif? Business segment overview Appendix RIPS: broad product and services capability Steel Fibre Closures Plastic #1 #1 #1 #2 IBC Earth Minded Filling #3 RIPS is the most comprehensive customer solutions provider in the industry Note: Ranking denotes standing
Slide 28: RIPS: highlights and differentiation
Who we are How we operate Why invest in Greif? Business segment overview Appendix RIPS: highlights and differentiation 2019 Financials ($M) Highlights and Capabilities Differentiation Revenue $2,490.6 • Extensive global expertise and • Industry’s most comprehensive operational footprint product line
Slide 29: RIPS: expanding reconditioning for sustainable solutions
Who we are How we operate Why invest in Greif? Business segment overview Appendix RIPS: expanding reconditioning for sustainable solutions Reconditioning overview Greif today Greif future state • Benefits to customers: • Operate services to facilitate • Closed loop network in place in collection and
Slide 30: PPS: broad portfolio offering a variety of paper products
Who we are How we operate Why invest in Greif? Business segment overview Appendix PPS: broad portfolio offering a variety of paper products Mills Containerboard Uncoated Recycled Coated Recycled Paperboard Paperboard Recovered Fiber C #2 #3 Converting Corrugated Tube & Core Products #2 Note: Ranking
Slide 31: PPS: highlights and differentiation
Who we are How we operate Why invest in Greif? Business segment overview Appendix PPS: highlights and differentiation 2019 Financials ($M) Highlights and Capabilities Differentiation Revenue $1,780.0 • Niche position in containerboard • Speed – response and lead times Adjusted EBITDA1 $348.3 • Leade
Slide 32: PPS: expanded, integrated and national paper network
Who we are How we operate Why invest in Greif? Business segment overview Appendix PPS: expanded, integrated and national paper network Containerboard Corrugated ~1M tons 7 sheet feeders Packaging 1 box plant Industry Recovered Uncoated Boxboard Tubes & Cores Fiber Group ~800K tons 45 converting plan
Slide 33: PPS: IPG benefits from diverse end markets
Who we are How we operate Why invest in Greif? Business segment overview Appendix PPS: IPG benefits from diverse end markets • IPG’s diversified end market revenue provides broad Tube/core revenue by end market1 exposure to US economic activity • Tube/core market offers limited risk as paper remains
Slide 34: PPS: Recovered Fiber Group
Who we are How we operate Why invest in Greif? Business segment overview Appendix PPS: Recovered Fiber Group Business Overview and Opportunities • Top 10 recovered fiber business with strategically positioned assets that limits freight/transport costs • Procures, collects, processes and brokers mate
Slide 35: FPS: global market leader with superior capabilities
Who we are How we operate Why invest in Greif? Business segment overview Appendix FPS: global market leader with superior capabilities 1&2 loop bag 4 loop bag Reconditioning Container liners 1-Loop 2-Loop #1 #1 #1 North America FPS is the largest FIBC producer in the world offering the most comprehe
Slide 36: FPS: highlights and differentiation
Who we are How we operate Why invest in Greif? Business segment overview Appendix FPS: highlights and differentiation 2019 Financials ($M) Highlights and Capabilities Differentiation Revenue $297.5 • Leading position in highly • Exceptional technical capabilities fragmented market and differentiated
Slide 37: Required reconciliation tables
Required reconciliation tables
Slide 38: GAAP to Non-GAAP Reconciliation: Operating Profit to Adjusted EBITDA
Who we are How we operate Why invest in Greif? Business segment overview Appendix GAAP to Non-GAAP Reconciliation: Reconciliation of Operating Profit to Adjusted EBITDA $Millions April 2020 – P.38
Slide 39: GAAP to Non-GAAP Reconciliation: Adjusted Free Cash Flow
Who we are How we operate Why invest in Greif? Business segment overview Appendix GAAP to Non-GAAP Reconciliation: Adjusted Free Cash Flow(1) $Millions April 2020 – P.39
Slide 40: GAAP to Non-GAAP Reconciliation: Projected 2020 Adjusted Free Cash Flow
Who we are How we operate Why invest in Greif? Business segment overview Appendix GAAP to Non-GAAP Reconciliation: Projected 2020 Adjusted Free Cash Flow $Millions April 2020 – P.40
Slide 41: GAAP to Non-GAAP Reconciliation: Earnings per share and Tax Rate
Who we are How we operate Why invest in Greif? Business segment overview Appendix GAAP to Non-GAAP Reconciliation: Earnings per share and Tax Rate $/share and % April 2020 – P.41
Slide 42: GAAP to Non-GAAP Reconciliation: Earnings per share and Tax Rate
Who we are How we operate Why invest in Greif? Business segment overview Appendix GAAP to Non-GAAP Reconciliation: Earnings per share and Tax Rate $/share and % April 2020 – P.42
Slide 43: Reconciliation of segment Operating Profit to Adjusted EBITDA
Who we are How we operate Why invest in Greif? Business segment overview Appendix GAAP to Non-GAAP Reconciliation: Reconciliation of segment Operating Profit to Adjusted EBITDA(4) $Millions (4) Adjusted EBITDA is defined as net income, plus interest expense, net, including debt extinguishment charge
Slide 44: Reconciliation of segment Operating Profit to Adjusted EBITDA
Who we are How we operate Why invest in Greif? Business segment overview Appendix GAAP to Non-GAAP Reconciliation: Reconciliation of segment Operating Profit to Adjusted EBITDA(4) $Millions (4) Adjusted EBITDA is defined as net income, plus interest expense, net, including debt extinguishment charge
Slide 45: Q1 Price, Volume and Foreign Currency Impact to Net Sales
Who we are How we operate Why invest in Greif? Business segment overview Appendix Q1 Price, Volume and Foreign Currency Impact to Net Sales for Primary Products: TOTAL SALES VOLUME PRICE FX VARIANCE RIPS NA -6.2% -5.0% 0.2% -11.0% ($12.7) ($10.2) $0.3 ($22.5) RIPS LATAM -1.4% 11.6% -15.4% -5.2% ($0.
Slide 46: Fiscal 2022 financial commitments assumptions
Who we are How we operate Why invest in Greif? Business segment overview Appendix Fiscal 2022 financial commitments assumptions • Net sales will be approximately $5.5B in Fiscal 2022 as a result of strategic growth CapEx, Caraustar inclusion and organic growth • Raw material costs assumed flat again