Nampak Limited · JSE:NPK
Nampak — Investor Day (September 2013)
57 slides from Nampak's investor day presentation, Sep 11, 2013
Slide 1: Nampak's Investor Day
Welcome to Nampak’s Investor Day Durban: 11 September 2013 |1
Slide 2: Programme for the Day
Programme for the Day • Beverage Cans and Glass - Charles Bromley • Africa growth – Rob Morris • Nampak Flexible – Clinton Farndell • Aerosol investment – Ephraim Msane • Address by Andrew Marshall • Tour of Flexible factory • Finger lunch • Depart for DivFood Mobeni at 14:00 • Tour of aerosol line
Slide 3: Beverage Cans
Beverage Cans South Africa, Angola and Nigeria Charles Bromley: Group Executive Metals & Glass |3
Slide 4: Growth - Alcoholic Drinks
Growth - Alcoholic Drinks index 180 170 160 150 140 130 120 110 100 90 2011 Aug 2011 Nov 2012 Feb 2012 May 2012 Aug 2012 Nov 2013 Feb 2013 May 2013 Aug |4
Slide 5: Growth – RSA Speciality Cans
Growth – RSA Speciality Cans index 130 125 120 115 110 105 100 95 90 2011 Aug 2011 Nov 2012 Feb 2012 May 2012 Aug 2012 Nov 2013 Feb 2013 May 2013 Aug |5
Slide 6: Growth – Value Packs 440 ml
Growth – Value Packs 440 ml index 280 260 240 220 200 180 160 140 120 100 80 2011 Aug 2011 Nov 2012 Feb 2012 May 2012 Aug 2012 Nov 2013 Feb 2013 May |6
Slide 7: South Africa - beverage cans
South Africa - beverage cans • Consumer perceptions of cans o Fundamental shift continues • Customer support/conversion to cans o Both big and smaller customers looking to invest in filling equipment Upgrades – approximately R100m New installations – 8 Can lines Currently in progress – 2 high
Slide 8: People Like ME!!
People Like ME!!
Slide 9: People Like ME!!
People Like ME!!
Slide 10: South Africa - long-term contracts
South Africa - long-term contracts • Short-term pain for long-term gain • We are sacrifcing margin short-term to secure long-term supply contracts and guaranteed volumes | 10
Slide 11: Angola
Angola • Existing line almost at full capacity – continued good growth o Support demand from South Africa • Proceeding with expansion • Decision for 2nd line substrate still pending • Duties are COMING, but final ratification still pending o Many brand owners pushing ahead with local filling operati
Slide 12: Nigeria - beverage cans
Nigeria - beverage cans • Nigerian market opportunity being pursued • Option is Greenfield or acquisition | 12
Slide 13: Overall Outlook for Beverage Cans
Overall Outlook for Beverage Cans Beverage can outlook in South Africa, Angola and Nigeria very promising | 13
Slide 14: Nampak Glass
Nampak Glass Charles Bromley: Group Executive Metals & Glass | 14
Slide 15: Nampak Glass
Nampak Glass • Overall glass market volumes are soft • Despite this the market has sought a viable second supplier in the glass manufacturing supply chain • Nampak Glass have secured term contracts for >85% of the future 3-furnace structure capacity | 15
Slide 16: Benefits of a 3rd Furnace to Nampak Glass
Nampak Glass Benefits of a 3rd Furnace to Nampak Glass • Three furnaces for three main colours – less colour changes • Improved energy efficiency built into design • UPS to ensure continued up-time with unreliable power supply • Faster machines with more accurate precision production capability • Hi
Slide 17: Nampak Glass
Nampak Glass • Short-term pain – longer-term gain • Implementation a bit slower but happening o Target end-June 2014 • Some impact on 2013 | 17
Slide 18: Nampak Glass
Nampak Glass 1 000 000 Total market Total market Total market Total market 1 015 000 t 1 016 000 t 980 000 t 950 000 t 750 000 500 000 Consol Nampak 250 000 0 2010/11 2011/12 2012/13 2013/onward Front loading of benefits to secure | 18 contracts and volume for 3rd furnace
Slide 19: Nampak Glass - Conclusion
Nampak Glass - Conclusion • Expect a significant recovery next year in performance • Impact of 3rd furnace will be small with start up and commissioning in last quarter of next financial year • Further volume growth as Nampak seen as a true strategic player in the South African glass market by our c
Slide 20: Thank You
Thank You | 20
Slide 21: Rest of Africa Growth
Rest of Africa Growth Rob Morris: Group Executive Paper & Flexibles | 21
Slide 22: Nampak in the Rest of Africa
Nampak in the Rest of Africa 12 countries Revenue +/- R2.5bn pa Trading margin >15% | 22
Slide 23: Trading Profit: 6 months to March
Trading Profit : 6 months to March Rm 200 197 180 160 142 140 120 100 89 80 58 56 60 40 20 0 2009 2010 2011 2012 2013 | 23
Slide 24: Rest of Africa Trading Profit
Rest of Africa Trading Profit 28% Rest of Africa 35% SA & UK 2013 2015 | 24
Slide 25: New Expansions
New Expansions Ethiopia Ghana Nigeria Angola | 25
Slide 26: Where Nampak Operates
Where Nampak Operates Country Population GDP GDP Growth Nigeria 168m $263bn 6.6% Ethiopia 92m $43bn 8.5% Tanzania 48m $28bn 6.9% Kenya 43m $37bn 4.3% Uganda 36m $20bn 3.4% Ghana 25m $41bn 7.9% Mozambique 25m $15bn 7.4% Angola 21m $114bn 6.8% Malawi 16m $4bn 1.9% Zambia 14m $21bn 7.3% Zimbabwe 14m $1
Slide 27: Where Nampak Does NOT Operate
Where Nampak Does NOT Operate Country Population GDP GDP Growth DRC 66m $18bn 7.2% Chad 12m $11bn 5.0% Rwanda 11m $7bn 8.0% Burundi 10m $25bn 4.0% CAR 5m $2bn 4.1% Congo 4m $14bn 3.8% Gambia 2m $1bn 6.0% Source: World Bank | 27
Slide 28: Customers Investments in Africa
Customers Investments in Africa | 28
Slide 29: Update on Angola
Update on Angola • New production facility/warehouse for various expansion projects • 2nd can line | 29
Slide 30: Update on West Africa
Update on West Africa Nigeria • Beverage can manufacture • Glass • Rigid plastics (commissioning Sept 2013) • Sorghum beer cartons (commissioned July 2013) Ghana • Investigating 2 acquisition opportunities (metals and rigid plastics) | 30
Slide 31: Update on Ethiopia
Update on Ethiopia • Acquisition in Ethiopia (currently 25% equity) • Green fields operation investigation • Crates Manufacture – (commissioning October 2013) | 31
Slide 32: Thank You
Thank You | 32
Slide 33: Nampak Flexible
Nampak Flexible Clinton Farndell: Managing Director Nampak Flexible | 33
Slide 34: Brands Supported
Brands Supported Pe Stuyvesant
Slide 35: Market Share: South Africa
Market Share: South Africa Value added sector of the market | 35
Slide 36: Key Market Issues
Key Market Issues • Good growth in flexible packaging (4.9% across the region) • Market driven by innovation and development • Flexibles currently the substrate of choice, particularly in Africa o driven by affordability o improved barrier properties o convenience (reseal ability and easy opening) |
Slide 37: Key Market Segments and Customers
Key Market Segments and Customers • Industries supplied Major customer base • Beverages and Wine Bags • Unilever • Confectionery • Simba • Household products • Distell • Industrial • Tastic • Soup and sauce • Tiger Brands • Tobacco • Nampak • Margarine • Masterfoods • Dairy Exports • Nestle Other 7%
Slide 38: Manufacturing Process
Manufacturing Process • EXTRUSION - Mono - Multi layer • PRINTING - Flexographic print - Gravure print • LAMINATING - Solvent based - Solvent less - Water based - Polyethylene or extrusion - Wax • SLITTING • POUCHING - Flat or Stand Up - Spouted or re sealable • BAGGING - 2 litre to 210 litre | 38
Slide 39: Flexible Division
Flexible Division FLEXIBLE FLEXIBLE FLEXIBLE KZN WESTERN CAPE P.E. Extrusion Extrusion, Lamination, Lamination , Gravure & Gravure & Flexographic Extrusion & Flexographic printing of Embossing of printing of Flexible Film & Flexible Film Flexible Film & and Pouches. Foil reels Conversion to pouch &
Slide 40: Broad Nampak Flexible Strategy
Broad Nampak Flexible Strategy • Remain focussed on added value markets • Maintain market shares at A customers • Invest behind innovation opportunities o 7 layer co ex, laser, pouches & printing • Drive growth into Africa eg. cube foil, single serve, refills (pouches) • Speed to market priorities |
Slide 41: 7-Layer Extruder
7-Layer Extruder Presented by: Clinton Farndell | Date: Wednesday, September 11, 2013
Slide 42: Gravure Printer
Gravure Printer • Review at K Show – Oct 13 • Expected commissioning in July 14 • | 42
Slide 43: Pouch Machines and Spout Inserter
Pouch Machines and Spout Inserter 2 x Pouch Machines and 1 x Spout Inserter installed in June 2012. | 43
Slide 44: Nampak Flexible Certifications
Nampak Flexible Certifications • ISO 9001: 2008 – Quality Management System • ISO 14001:2004 – Environmental Management System • BRC Packaging Issue 4 – Packaging Safety System, Grade A both plants • AIB – Food Safety System 800 Points unannounced • H.A.C.C.P. principles are applied as part of the B
Slide 45: Gold Pack 2013 Finalists
Gold Pack 2013 Finalists 22 yrs IN | =—— wp ackaging excellence [45 pe ging
Slide 46: Thank You
Thank You | 46
Slide 47: Aerosol Investment
Aerosol Investment Ephraim Msane: Managing Director Nampak DivFood | 47
Slide 48: DivFood Mobeni Product Range
DivFood Mobeni Product Range
Slide 49: DivFood Mobeni Sales
DivFood Mobeni Sales Shoe Polish General Sealed Oil 13% Products 14% 1% Paint Aerosols 27% 45%
Slide 50: Mobeni Plant Key Statistics
Mobeni Plant Key Statistics • Production lines • Monobloc Aerosol 6 • Paint, Oil & General 12 • Shoe Polish 6 • Printing 10 • Area Under Roof 50 000 m²
Slide 51: Monobloc Aerosol Cans
Monobloc Aerosol Cans
Slide 52: Monobloc Historic Growth
Monobloc Historic Growth | 52
Slide 53: Major Monobloc Customers
Major Monobloc Customers Other Local 2% Exports 30% Unilever 41% Tiger 7% Revlon 16% Rolfe 4%
Slide 54: Line 5 commissioned 2011
Line 5 commissioned 2011 MA). > =
Slide 55: Line 6 Commissioned 2013
Line 6 Commissioned 2013 | 55
Slide 56: Conclusion
Conclusion • Capacity increased from 3 to 6 lines in the last 5 years, as demand continued to grow • Customers being approached to convert from imports to local supply • Increased capability to meet current shaping and design requirements • Off peak capacity is sold to the export market • Monobloc a
Slide 57: Thank You
Thank You | 57