Newell Brands Inc. · NASDAQ:NWL
Newell Brands — Proxy Contest (February 2018)
54 slides from Newell Brands's proxy contest presentation, Feb 27, 2018
Slide 1: Q4 2017 Global Meeting
Q4 2017 Global Meeting
Slide 2: Forward-looking Statements
Forward-looking Statements Forward-looking statements in this presentation and the accompanying remarks are made in reliance upon the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements generally are accompanied by words such as “intend,” “anticipate,” “b
Slide 3: Additional Information
Additional information Additional Information In connection with Newell’s 2018 Annual Meeting of Shareholders, Newell will file with the SEC and mail to the shareholders of record entitled to vote at the 2018 Annual Meeting a definitive proxy statement and other documents, including a WHITE proxy ca
Slide 4: Global Meeting Q4 2017 Results
Newell Brands | Global Meeting Q4 2017 Results
Slide 5: Q4 2017 Results
Q4 2017 Results Net sales of $3.7 billion declined 9.5% year-over-year Core sales declined 1.9% year-over-year Cost savings from synergies and Project Renewal contributed incremental $75 million Reported diluted earnings per share were $3.38, compared with $0.34 in the prior year Normalized diluted
Slide 6: Q4 2017 regional core sales growth
Q4 2017 regional core sales growth Home Fragrance Writing EMEA -6.2% NA Writing -2.2% APAC Food +0.2% CCS LATAM +9.4% © Ne 6
Slide 7: Good progress in 2017
Good progress in 2017 Reorganized from 32 to 16 divisions Q1 17 eCommerce team scaled faster: 350 new hires Development and Design capability broadened 300+ innovation/renovation projects Tripled legacy Jarden innovation funnel value Restructured portfolio: 8 divestitures, 3 acquisitions © Newell Br
Slide 8: What worked 2017: Market Share growth
What worked 2017: Market Share growth © Newell Brands 2017 US Market Share Change (bps) 60% 56% +71 bps market sharp of portfolio gaining share of category growth -72 -123 -157 Team Fishing Home Writing Baby Gear Food Outdoor Vacuum Beverage Fresh Apparel Infant Care Tabletop Appliances Sports Fragr
Slide 9: What worked 2017: Building momentum
What worked 2017: Building momentum U.S MARKET SHARE 2014 2017 US Market Share Change (bps) 60% 56% +71 bps market sharp of portfolio gaining share of category growth -72 -123 -157 Team Fishing Home Writing Baby Gear Food Outdoor Vacuum Beverage Fresh Apparel Infant Care Tabletop Appliances Sports F
Slide 10: What worked 2017: Confidence in future momentum
What worked 2017: Confidence in future momentum © Newell Brands Body Text;U.S. MarketShare2014through Writing (ex Glue) Baby Gear Food Storage Source: Baby Gear: NPD, Writing ex Clue: NPD, Food storage: IRI Baby Gear Food Storage
Slide 11: What worked 2017: Global eCommerce
What worked 2017: Global eCommerce +SDD% 4Q 2017 vs. 2016 – Leading etailer US Invoice Sales by Division 2017 2016 Baby Appliances & Cookware +SDD% Writing Outdoos & Recreation Core sales growth Food in 4Q17 Safety & Security Consumer & Commercial Solutions Home Fragrance Fishing Team Sports Fine Wr
Slide 12: What worked 2017: Savings & Synergies
What worked 2017: Savings & Synergies $358 million © Newell Brands 12
Slide 13: 2017 challenges: US retailer landscape
2017 challenges: US retailer landscape © Newell Brands 2017 challenges: US retailer landscape US retailer weeks of Inventory on hand (measured channels) change vs. PY 0.8 -0.7 Q216 Q316 Q416 Q1 17 Q217 Q317 Q417 Source: Trade inventory and POS data provided direct from retailers (eg Retail Link for
Slide 14: 2017 challenges: Pricing and inflation
2017 challenges: Pricing and inflation Difficult Pricing Environment Growing Promotion Expectation % of category $ sold on promo Resin Inflation Resin cost per pound % of categories with flat to declining prices 47% Source: IRl, average basket of goods across multiple Newell and non Newell categorie
Slide 15: 2017 challenges: Margin pressure
2017 challenges: Margin pressure Fixed Cost Pricing/ Absorption eCommerce Synergies/ Inflation & Mix Invest Savings
Slide 16: Fundamental Challenge: Changing retail landscape
Fundamental Challenge: Changing retail landscape eCommerce Brick & Mortar © Newell Brands
Slide 17: Winning in the new retail environment
Winning in the new retail environment Build leading brands to win share and grow categories Create advantaged capabilities enabled by the scale and efficiency of an operating company Design innovative and differentiated products (form, finish, function) Scale eCommerce globally Reallocate and focus
Slide 18: One Company, One Corporate Strategy
One Company, One Corporate Strategy Diversified, global branded consumer Operating model Leading brands products company delivering in large, growing, consistent unconsolidated global categories competitive growth Margin Scale and capabilities expansion and to out-spend strong cash and out-grow flow
Slide 19: And transformation is on track
And transformation is on track We are here 2016/H1 2017 2H 2017/2018 2019-21 Simplify Strengthen Scale • Organization • Innovation/Design • Innovation/Design • Portfolio (divest) • eCommerce • eCommerce • Divisional costs • Deployment (near neighbors) • Deployment(near neighbors) • Procurement • Cor
Slide 20: Announced Acceleration of Transformation Plan
Announced Acceleration of Transformation Plan We announced a series of strategic initiatives to accelerate our transformation plan, improve operational performance and enhance shareholder value: We’ll focus our portfolio on nine core consumer divisions with approximately $11 billion in net sales and
Slide 21: Businesses Under Review; strong early interest
Businesses Under Review; strong early interest Divisions Key Brands Consumer & Commercial Solutions Waddington Process Solutions Process Solutions Team Sports Beauty USPC © Newell Brands
Slide 22: Why reshape the portfolio now?
Why reshape the portfolio now? Sharpens focus on core and enables quicker response to market conditions Maximizes growth and margin potential via 20% US eCommerce exposure Reduces future fixed cost margin exposure to B&M consolidation Simplification accelerates margin development and strengthens FCF
Slide 23: Significant complexity reduction
Significant complexity reduction 25% of Revenue under review 53% in Factories 47% in Distribution Centers 50% in Retailers & Distributors ~40% in Brands ~100% in OEM and Private Label © Newell Brands
Slide 24: Newell Brands Post Transformation
Newell Brands Post Transformation Divisions Key Brands Writing Appliances & Cookware Outdoor & Recreation Baby Home Fragrance Food Fishing Jostens Safety & Security © Newell Brands and Ball® TMs Ball Corporation, used under license. ©2015 Hearthmark, LLC. All Rights Reserved.
Slide 25: $11 billion consumer goods company
$11 billion consumer goods company Advantaged Brands touch Large Opportunity capabilities hundreds of addressable to expand and scale to millions everyday categories geographies outperform eCommerce Leading brand leadership Partner with winning activity and International customers to expand consumer
Slide 26: Scaled innovation funnel
Scaled innovation funnel (tripled legacy JAH) Innovation Funnel Composition – Number of Projects number of projects, 2012 funnel 2013 funnel 2014 funnel 2015 funnel 2016 funnel Q4’17 funnel annualized iRev 2013+ 2014+ 2015+ 2016+ 2017+ 2017+ $10m and above 8 12 26 39 68 107 $5 -10m 8 34 52 89 118 21
Slide 27: Promising new concepts
Promising new concepts Over 100 concepts tested per month Total* Differentiation Relevance Q4 2017 23% 47% 40% 40% MH-H 73% 65% M-ML-L 77% 53% 60% 60% 27% 25% Total Newell Ipsos Total Newell Ipsos Total Newell Ipsos Benchmark Benchmark Benchmark * Achieves MH-H on both Differentiation and Relevance
Slide 28: Crock-Pot Express Crock Multi-Cooker
Crock-Pot® Express Crock Multi-Cooker 8-in-1 Multi-Cooker that can cook meals up to 70% faster than traditional cooking, while also offering the versatility of slow cooking, steaming and sautéing.
Slide 29: Calphalon Premier Space Saving Cookware
Calphalon Premier™ Space Saving Cookware Securely stacks to save 30% more space*. The unique design allows for the cookware to stack and nest in any order**, saving space and helping to organize the kitchen cupboard. *Average space saved vs. like non-stacking Calphalon® cookware items when stacked w
Slide 30: Coleman Dark Room Tents
Coleman® Dark Room™ Tents Blocks 90% of sunlight, reducing the heat within the tent. Sleep in after the sun rises or put the kids to bed early while the sun is still up.
Slide 31: First Alert Onelink Safe & Sound
First Alert® Onelink Safe & Sound Combines intelligent protection from smoke, fire and carbon monoxide with superior audio capabilities, compatibility with connected home platforms, premium home speakers and hands-free voice commands.
Slide 32: Graco UNO2DUO Travel System
Graco® UNO2DUO™ Travel System A single stroller that extends 5 inches into a double stroller for two children as families grow from one to two, giving parents and children 18 customizable ways to ride.
Slide 33: Marmot Featherless
Marmot® Featherless With warmth equal to 700 fill power down, Featherless’ synthetic insulation is ultralight, packable and stays warm when wet, so adventure-minded athletes will never think twice about the weather.
Slide 34: Candle Power Pop-Up Shop
Candle Power Pop-Up Shop An experiential boutique featuring Yankee Candle®, WoodWick® and Chesapeake Bay Candle® complete with immersive, multi-sensory installations, personalized candles, a scent test bar, craftsmanship area and gift bar.
Slide 35: 2H 2018 – Calphalon Appliances
2H 2018 – Calphalon Appliances
Slide 36: KZOO – Design as advantaged capability
KZOO – Design as advantaged capability
Slide 37: Looking forward!
Looking forward! Innovation sessions: 33 Participants: 265 Ideas: 11,140+ Concept screens: 924+
Slide 38: Much stronger eCommerce footprint
Much stronger eCommerce footprint FY 2017, US, % of total sales from eCommerce US consumer facing business 49% 20% Ecommerce 24% 21% 20% 14% 13% 10% 10% 7% 2% Baby Jostens A&CW O&R Writing Home Frag S&S Fishing Food Under Review “Under review” consists of businesses under review for strategic option
Slide 39: Huge opportunity ahead
Huge opportunity ahead (as result of new organization) 2018 Ecommerce Ecommerce Category Strategies • International under-leveraged (NWL 90% Appliances Ecommerce targeted growth US at leading pureplay retailer) +30% in 2018 • European Ecommerce hub opens mid- 2018 Opportunity to Premiumize (average
Slide 40: New Brand Direct-to-Consumer Brand Store
New Brand Direct-to-Consumer Brand Store @theheartoflife brand store to launch in the fourth quarter of 2018 leveraging common infrastructure and integrated learning out of Ecommerce DTC team. © Newell Brands
Slide 41: Global Meeting External News
Newell Brands | Global Meeting External News
Slide 42: Strengthening the Board with experienced operators
Strengthening the Board with experienced operators Jim Craigie Debra Crew Judy Sprieser Non-exec Chairman Church & Dwight Former President & CEO Former President & CEO Former Chairman & CEO CHD Reynolds American Transora.com © Newell Brands
Slide 43: Proxy contest background
Proxy contest background One of Newell’s investors, Starboard Value LP, have nominated their own slate of directors to be appointed to our Board (including three former Directors of Newell Brands) This will be decided through what is called a proxy contest. A proxy contest is when two opposing parti
Slide 44: Proxy Contest next steps
Proxy Contest next steps You will see both parties make public statements through letters, press releases and media appearances. These can also include a series of ballots on which to vote (from both parties) In the coming weeks, all shareholders will be receiving a proxy statement. It is important
Slide 45: Global Meeting Employee Questions
Newell Brands | Global Meeting Employee Questions
Slide 46: Newell Brands
“oN. newell BRANDS
Slide 47: Appendix: Non-GAAP Reconciliations
Appendix: Non-GAAP Reconciliations
Slide 48: Non-GAAP Financial Measures
Non-GAAP Financial Measures This presentation contains non-GAAP financial measures within the meaning of Regulation G promulgated by the Securities and Exchange Commission and includes a reconciliation of these non-GAAP financial measures to the most directly comparable financial measures calculated
Slide 49: Q4 2017 GAAP & Non-GAAP Certain Line Items
Q4 2017 GAAP & Non-GAAP Certain Line Items NEWELL BRANDS INC. Reconciliation of GAAP and Non-GAAP Information CERTAIN LINE ITEMS (in millions, except per share data) For the three months ended December 31, 2017 GAAP Measure Project Renewal Costs [1] Acquisition Transaction Other Net gain/(loss) Non-
Slide 50: Q4 2016 GAAP & Non-GAAP Certain Line Items
Q4 2016 GAAP & Non-GAAP Certain Line Items NEWELL BRANDS INC. Reconciliation of GAAP and Non-GAAP Information CERTAIN LINE ITEMS (in millions, except per share data) For the three months ended December 31, 2016 GAAP Measure Project Renewal Costs [1] Acquisition Transaction Net gain/(loss) on Non-rec
Slide 51: Q4 2017 and Q4 2016 GAAP & Non-GAAP Line Items (continued)
Q4 2017 and Q4 2016 GAAP & Non-GAAP Certain Line Items (continued) * Normalized results are financial measures that are not in accordance with GAAP and exclude the above normalized adjustments. See below for a discussion of each of these adjustments. **Totals may not add due to rounding. [1] Costs a
Slide 52: Q4 2017 and Q4 2016 Segment Normalized Operating Income/Margin
Q4 2017 and Q4 2016 Segment Normalized Operating Income/Margin NEWELL BRANDS INC. Financial Worksheet - Segment Reporting in Millions For the three months ended December 31, 2017 For the three months ended December 31, 2016 Year over year changes Reported Reported Normalized Normalized Reported Repo
Slide 53: Q4 2017 Core Sales by Segment
Q4 2017 Core Sales by Segment NEWELL BRANDS INC. Core Sales Analysis by Segment - Actual and Adjusted Pro Forma Basis (Unaudited) For the three months ended December 31, 2017 and 2016 in Millions December 31, 2017 December 31, 2016 Acquisitions/ 2017 Divestitures 2016 Increase (Decrease) Net Sales a
Slide 54: Q4 2017 Core Sales By Geography
Q4 2017 Core Sales By Geography NEWELL BRANDS INC. Core Sales Analysis by Geography - Actual and Adjusted Pro Forma Basis (Unaudited) For the three months ended December 31, 2017 and 2016 December 31, 2017 December 31, 2016 Acquisitions/ 2017 Divestitures 2016 Increase (Decrease) Net Sales and Other