Brambles Limited · ASX:BXB
Brambles — FY2009 Earnings Presentation
39 slides from Brambles's earnings presentation, Aug 20, 2009
Slide 1: 2009 Final Results
2009 Final Results 20 August 2009
Slide 2: Mike Ihlein, Chief Executive Officer
Mike Ihlein Chief Executive Officer
Slide 3: Well positioned for recovery
Well positioned for recovery Sales revenue resilient • Net new business wins (circa US$100m) offset weak organic volume • Investment for growth continues Strong cash generation and disciplined capital management • Free cash flow • Operating cash flow • Strong balance sheet Major initiatives un
Slide 4: Delivering revenue growth and strong cash flow
Delivering revenue growth and strong cash flow Sales revenue Underlying profit Statutory EPS Free cash flow 1% 8% after dividends ( 8% actual) ( 16% actual) ( 29% actual) US$142m Economic impact • Organic growth • Higher plant stock • Automotive • Paper Sales revenue growth (despite automotive a
Slide 5: Automotive and SDS impact
Automotive and SDS impact Group sales revenue growth 3% (reported 1%) • Automotive down 23% (US$43m) • SDS down 13% (US$23m) Group Underlying profit down 5% (reported down 8%) • Automotive down 53% (US$27m) • SDS down 43% (US$12m) Growth % and US$ calculated on constant currency basis 5
Slide 6: Americas – net new wins offset organic decline
Americas – net new wins offset organic decline Sales revenue Underlying profit CFO 2% 6% US$267m¹ Sales • USA sales revenue in line with prior year – organic volumes down 4% – net new wins 3% (US$35m) • Rest of Americas 9% growth Underlying profit reflects economic slowdown • Higher plant stock
Slide 7: EMEA – net new wins offset organic/auto decline
EMEA – net new wins offset organic/auto decline Excluding Auto Sales revenue Underlying profit CFO Sales 2% flat 7% US$373m Underlying profit 2% Sales • organic volumes down 5% • net new wins 3% (Europe US$40m) • Automotive down 22%; 2% growth excluding auto • Germany 20% / Poland 60% growth Und
Slide 8: Asia-Pacific – core sales up and investment for growth
Asia-Pacific – core sales up and investment for growth Excluding Auto Sales revenue Underlying profit CFO Sales 3% 1% 19% US$10m Underlying profit 12% Sales • ANZ core pallets / RPCs up 2% • Automotive down 23% • 3% growth excluding automotive • Asia growth > 60% (excl. ANZ) Underlying profit re
Slide 9: Strong growth in core DMS
Strong growth in core DMS Excluding SDS Sales revenue Underlying profit CFO Sales 6% 1% 3% US$107m Underlying profit 8% Sales growth • Document Management Solutions up 6% • Secure Destruction Services (SDS) down 13% – Reduction in paper revenue and lower activity Underlying profit • DMS margin i
Slide 10: Initiatives to underpin performance on track
Initiatives to underpin performance on track Facilities and operations • FY09 expense US$54m • Total program cost approximately US$60m • Approximately 600 headcount reduction • Savings FY10 US$30m+ (FY11 onwards US$40-50m) CHEP USA accelerated excess pallet scrapping CHEP USA pallet quality pr
Slide 11: CHEP USA Review on track
CHEP USA Review on track Target completion end September; announcement early October Further significant positive engagement with our key customers Wood pallet platform remains best solution for broad supply chain • Economic and environmental sustainability Alternative platforms not currentl
Slide 12: CHEP value proposition
CHEP value proposition CHEP makes the world’s supply chains more efficient • Consistent quality • Availability • Eliminates customer purchases, exchange and repair • Reduced transportation and handling • Competitive pricing Environmental sustainability Global CHEP organisation • Deep knowledge
Slide 13: Well positioned for recovery
Well positioned for recovery Sales growth Strong cash generation Strong balance sheet Major initiatives underpin future performance Well placed to accelerate financial performance as economies recover 13
Slide 14: Liz Doherty, Chief Financial Officer
Liz Doherty Chief Financial Officer
Slide 15: 2009 Final Results
2009 Final Results Actual Constant FY09 FY09 FY08 Growth US$m US$m US$m % Continuing operations Sales revenue 4,018.6 4,407.3 4,358.6 1 Underlying profit 900.6 986.9 1,071.9 (8) Underlying EPS (cents) 38.5 42.2 45.4 (7) Statutory EPS¹ (cents) 32.6 n/a 46.0 Cash flow from operations 722.4 818.1 810.0
Slide 16: Underlying profit
Underlying profit US$m 72 30 41 1,072 39 47 987 Economic FY08 Vol, Price & Investments in Other (incl. Auto / SDS Economy FY09 Mix growth cost inflation) related All numbers are calculated at constant currency 16
Slide 17: Significant items
Significant items FY09 FY08 Actual rates US$m US$m Underlying profit 900.6 1,071.9 Items within ordinary activities, but unusual due to size and nature: USA Quality program (77.4) (20.6) Walmart net transition impact (29.0) (10.9) Items outside the ordinary course of business: Accelerated scrapping
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Slide 19: CHEP overview
CHEP overview Actual Constant FY09 FY09 FY08 Growth US$m US$m US$m % Americas 1,556.9 1,617.5 1,581.3 2 EMEA 1,452.6 1,640.3 1,642.1 - Asia-Pacific 323.4 390.4 386.9 1 Sales revenue 3,332.9 3,648.2 3,610.3 1 Underlying profit 823.0 900.7 976.2 (8) Profit margin (%) 25 25 27 Growth % calculated on US
Slide 20: Sales - by service line
Sales - by service line Actual Constant FY09 FY09 FY08 Growth US$m US$m US$m % Pallets 2,956.7 3,220.7 3,157.0 2 RPC 151.1 177.0 168.5 5 Automotive 132.2 147.2 190.2 (23) Other 92.9 103.3 94.6 9 Sales revenue 3,332.9 3,648.2 3,610.3 1 Growth % calculated on US$ constant currency basis 20
Slide 21: Americas – Underlying profit
Americas – Underlying profit US$m 6 37 31 484 30 454 FY08 Vol, Price & Mix Transport Costs Plant costs Other FY09 All numbers are calculated at constant currency 21
Slide 22: EMEA – Underlying profit
EMEA – Underlying profit US$m 20 20 397 9 27 8 369 FY08 Vol, Price & Automotive Transport Plant costs Other FY09 Mix Costs All numbers are calculated at constant currency 22
Slide 23: Asia-Pacific – Underlying profit
Asia-Pacific – Underlying profit US$m 5 7 96 2 9 5 78 FY08 Vol, Price & Automotive Transport Plant costs Other FY09 Mix Costs All numbers are calculated at constant currency 23
Slide 24: Brambles
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Slide 25: Recall overview
Recall overview Actual Constant FY09 FY09 FY08 Growth US$m US$m US$m % Americas 313.3 326.5 333.3 (2) Europe 188.9 213.5 202.2 6 RoW 183.5 219.1 212.8 3 Sales revenue 685.7 759.1 748.3 1 Underlying profit 104.3 118.2 122.4 (3) Profit margin (%) 15 16 16 Growth % calculated on US$ constant currency b
Slide 26: Sales by service line
Sales by service line Actual Constant FY09 FY09 FY08 Growth US$m US$m US$m % Document Management Solutions 470.8 528.2 496.8 6 Secure Destruction Services 145.6 154.2 176.8 (13) Data Protection Services 69.3 76.7 74.7 3 Sales revenue 685.7 759.1 748.3 1 Growth % calculated on US$ constant currency b
Slide 27: Gross profit by service line
Gross profit by service line Actual Constant FY09 FY09 FY08 Growth US$m US$m US$m % Document Management Solutions 184.0 207.1 191.7 8 Secure Destruction Services 48.6 52.1 70.6 (26) Data Protection Services 36.5 40.9 37.7 8 Gross profit 269.1 300.1 300.0 - Growth % calculated on US$ constant currenc
Slide 28: Underlying profit
Underlying profit US$m 12 12 122 4 118 FY08 DMS / DPS SDS Other FY09 All numbers are calculated at constant currency 28
Slide 29: Cash flow and finance
Cash flow and finance Brambles
Slide 30: Strong cash flow
Strong cash flow US$m Actual rates FY09 FY08 Change EBITDA 1,212.6 1,499.0 (286.4) Capital expenditure (683.8) (869.4) 185.6 Proceeds from disposals 104.6 133.8 (29.2) Working capital movement 25.8 41.4 (15.6) Irrecoverable pooling equipment provision 97.8 91.2 6.6 Provisions / other (34.6) (86.0) 5
Slide 31: Significant reductions in capital expenditure (PP&E)
Significant reductions in capital expenditure (PP&E) Actual rates FY08 US$849m FY09 US$672m 6% 8% 12% 14% 40% 43% 42% 35% CHEP Americas CHEP EMEA CHEP Asia-Pacific Recall 31
Slide 32: Capital expenditure (PP&E)
Capital expenditure (PP&E) US$m Actual rates 433 416 377 295 1H08 2H08 1H09 2H09 CHEP Americas CHEP EMEA CHEP Asia-Pacific Recall 32
Slide 33: Financial ratios
Financial ratios Actual rates FY09 FY08 Covenants Closing net debt (US$m) 2,143.4 2,426.2 Gearing (%) 60.0 61.1 (Net debt/net debt & equity) EBITDA* / net finance costs (x) 10.0 10.0 3.5 x (min) Net debt / EBITDA* (x) 1.8 1.6 3.5 x (max) * EBITDA is Underlying profit excluding depreciation and amort
Slide 34: Credit facilities and liquidity
Credit facilities and liquidity Excellent progress on refinancing bank facilities US$1.9bn of bank facilities renewed • US$110m raised from US Private Placement debt market • Dividend reinvestment plan for FY09 interim contributed US$62m of funding US$3.4bn of committed credit facilities • ave
Slide 35: Mike Ihlein, Chief Executive Officer
Mike Ihlein Chief Executive Officer
Slide 36: Well placed to accelerate financial performance
Well placed to accelerate financial performance FY09 platform • Won significant new business • Continued investment for growth • Major initiatives implemented • Strong cash focus / balance sheet Early signs of improving economies • Destocking coming to an end Well placed for economic recovery
Slide 37: Disclaimer statement
Disclaimer statement The release, publication or distribution of this presentation in certain jurisdictions may be restricted by law and therefore persons in such jurisdictions into which this presentation is released, published or distributed should inform themselves about and observe such restrict
Slide 38: 2009 Final Results
2009 Final Results 20 August 2009
Slide 39: Contact details
Contact details Michael Roberts Vice President Investor Relations and Corporate Affairs michael.roberts@brambles.com +61 (0)2 9256 5216 39