Slide 1: CEO Presentation Annual General Meeting
MACFARLANE GROUP PLC CEO Presentation Annual General Meeting 8th May 2012
Slide 2: Agenda
MACFARLANE GROUP PLC 2011 Performance Strategic Development Case Study Outlook
Slide 3: 2011 Market Conditions
2011 Market Conditions UK demand remained weak due to macroeconomic factors Key packaging market sectors remained robust: 3PL Internet Retail The self adhesive labels market continued to be price oriented Raw material price inflation continued but softened in Q4
Slide 4: Raw Material Prices
Raw Material Prices Ra w Ma teria l Prices / Tonne £1,300 £550 £525 £1,250 £500 £475 £1,200 £450 £425 £1,150 £400 £1,100 £375 £350 £1,050 £325 £300 £1,000 £275 £250 £950 £225 £900 £200 Q1 2010 Q2 2010 Q3 2010 Q4 2010 Q1 2011 Q2 2011 Q3 2011 Q4 2011 Q1 2012 Polymer £/ tonne £1,027 £1,119 £1,066 £1,00
Slide 5: 2011 Performance
2011 Performance Macfarlane Group • Sales up 7% * • PBT up 16% (pre-exceptionals)* Packaging Distribution • Sales up 7% * • Gross margin erosion but improved profitability * Manufacturing Operations • Sales up 6% * • Packaging Manufacturing profits sustained but profit reduction in Labels Despite un
Slide 6: Sales per Employee
Sales per Employee* £000 344 Best Practice Sales Opportunity ** 254 262 220 223 £36m 205 07 08 09 10 11 20 20 20 20 20 Sales per Employee Best Practice * These figures are for the Packaging Distribution business only. ** The Best Practice sales opportunity is based on all RDCs achieving the sales le
Slide 7: Sales per Square Foot
Sales per Square Foot* £ Best Practice Sales Opportunity ** 256 £41m 174 189 172 173 158 2007 2008 2009 2010 2011 Sales per Square Foot Best Practice * These figures are for all RDCs in the Packaging Distribution business only ** The Best Practice sales opportunity is based on all RDCs achieving the
Slide 8: Return on Sales by RDC
Return on Sales by RDC * Best Practice Third Quartile - RDC's Top Quartile - RDC's Profit (ROS) 9.30% 9.50% 9.20% Opportunity ** 6.40% 7.10% 7.50% £6.9m Bottom Quartile - RDC's Second Quartile - RDC's 5.50% 4.00% 2.60% 2009 0.60% 0.40% -1.60% 2010 2011 • These figures are based on all RDCs in the Pa
Slide 9: Strategic Development: Increase 3PL Market Penetration
Strategic Development Increase 3PL Market Penetration Market potential c.£40m current Macfarlane market share 25% Sales growth of 24% Improved penetration of existing 3PL customers (DHL & Wincanton) Gain of new customers e.g. Promotional Logistics
Slide 10: Strategic Development: Increasing Web Presence
Strategic Development Increasing Web Presence Web related sales growth of 11% 12% of total Packaging Distribution sales now electronically transacted
Slide 11: Strategic Development: Presentational & Retail Packaging
Strategic Development Presentational & Retail Packaging New product range for our customers Start up in 2010 – Current sales £2.3m with 50% growth in 2011 Business mix half new customers and half existing customers Strong pipeline of new opportunities Opportunity to develop £10m incremental sales
Slide 12: Strategic Development: Growth of Reseal-it
Strategic Development Growth of Reseal-it Sales growth of 41% Increased market penetration in the USA New UK market penetration: Tesco, Morrisons, Sainsbury.
Slide 13: Customer Case Study: Background
Customer Case Study Background Lakeland was founded in 1963 is privately owned and based in Cumbria Lakeland is a leading mail order and high street retailer of kitchenware In 2010 Lakeland was joint first in the “Which High St. Shops Survey” Lakeland has 3 million customers, 4000 product lines, 9 m
Slide 14: Customer Case Study: Challenge and Process
Customer Case Study Challenge Reduce range of packaging products Improve packing process and reduce packing footprint of the operation Enhance customer experience Process In depth analysis of Lakeland operation Working with high seasonal usage Introducing supply partners - B Plus & Saica Trial and t
Slide 15: Customer Case Study: Lakeland Benefits
Customer Case Study Lakeland Benefits Reduced carton sizes from 19 to 10 New automated packing process doubled productivity/hour Saved space by enabling volume growth in less sq footage Courier vehicle utilisation improved by c30% Lakeland Customer Benefits Improved presentation and ease of opening
Slide 16: Customer Case Study: Our Differentiators
Customer Case Study The view from Lakeland ??. Macfarlane innovative and independent Macfarlane proactive and flexible Macfarlane focussed on the needs of the customer Macfarlane demonstrating clear market leadership Our Differentiators = Value for Lakeland
Slide 17: Outlook
Outlook Levels of demand in the UK economy remain uncertain and raw material prices will continue to be volatile Packaging Distribution core proposition remains strong Enhanced by our expertise in key sectors e.g. 3PL Increasing breadth of our product range through PRP Growing importance of our web