Mpact Limited · JSE:MPT
Mpact — Investor Presentation (November 2011)
28 slides from Mpact's investor presentation, Nov 16, 2011
Slide 1: Mpact Business Overview
Mpact Business Overview Analyst and investor site visits 15 & 16 November 2011
Slide 2: Table of contents
Table of contents Mpact at a glance Key investment highlights Overview of businesses • Paper packaging – Recycling, paper manufacturing, corrugated • Plastics packaging 2 │ Analyst & investor site visits │ 15&16 November 2011
Slide 3: Mpact at a glance
Mpact at a glance 3 │ Analyst & investor site visits │ 15&16 November 2011
Slide 4: Mpact business overview
Mpact business overview Mpact (Revenue R5,718m1) Paper (Revenue R4,407m2) Plastics (Revenue R1,310m2) Primary product categories Primary product categories Recovered paper collection PET bottles and preforms, hot fill bottles, PET jars and closures Packaging and industrial papers such as carto
Slide 5: Our strategy...
Our strategy... Develop and selectively grow our leading market positions in rigid plastics, paper-based packaging Leading market and packaging papers in sub-Saharan Africa positions o Growth where we are able to extract value through business and operational management expertise as well as produc
Slide 6: Key historical events and investments
Key historical events and investments Since 2005 Mpact invested R2.7bn1 to double revenue and EBITDA 8,000 Establishment of Mondi Mondi Mondi Group Mpact • Demerger and listing of Key events Packaging South Africa Group ESOP demerged from recapitalisation Mpact (Proprietary) Limited (as esta
Slide 7: Corporate governance
Corporate governance Shareholding structure Board of directors Director Role Anthony (Tony) Phillips* Non-executive Chairman Shanduka Bruce Strong CEO Freefloat Packaging Egar (Les) Leong CFO Andrew Thompson* Non-executive Neo Dongwana* Non-executive Timothy Ross* Non-executive c.10.45% c.89.55% Nom
Slide 8: Key investment highlights
Key investment highlights 8 │ Analyst & investor site visits │ 15&16 November 2011
Slide 9: Key investment highlights
Key investment highlights 1 Leading market positions 2 Customer focused operating structure 3 Integrated corrugated packaging value chain 4 Track record of profitable growth 5 Opportunities for continued growth 9 │ Analyst & investor Management site visits││June Presentation 15&16 November 2011 2011
Slide 10: Leading market positions
1 Leading market positions Mpact rankings Key products categories Market position in South Africa Corrugated packaging #1 Recycled based cartonboard and containerboard #1 Recovered paper collection #1 PET preforms #1 Styrene trays #1 Plastic jumbo bins #1 Leading market position allows Mpact to ac
Slide 11: Customer focused operating structure
2 Customer focused operating structure… Harare Recycling1 Corrugated2 Packaging and Industrial Paper Plastics Windhoek2 Brits Pretoria1 Maputo2 Nelspruit Midrand1 Walvis Bay Johannesburg Ekurhuleni1 Piet Retief Richards Bay Felixton Bloemfontein3 Durban Broad manufacturing and service footprint enab
Slide 12: Underpinned by an innovative product offering
2 … underpinned by an innovative product offering Innovation Centres Play self-erecting Retail Ready wraparound sleeve1 Super Lay-flat divider1 Structural and graphic design Development studios Value added services 500ml Glaceau PET Plastics Design Studio Hot Fill bottle1 PET Wine Bottle Chill
Slide 13: Winner of 2011 Gold Pack Trophy and several other awards
Winner of 2011 Gold Pack Trophy and several other awards • Mpact won the overall Gold Pack Trophy for the RAPPET™ 187ml PET wine bottle, as well as “Best in Category” • Mpact Plastics received four Gold Medals • Preform and Closure Lightweightings for 500ml, 1-Litre and 2-Litre Carbonated Soft Drink
Slide 14: Integrated corrugated packaging value chain
3 Integrated corrugated packaging value chain Security of supply of Recovered key raw material Packaging Corrugated paper Reduced impact of papers Packaging collected cyclicality of raw material prices Containerboard Mpact’s own 266 kt 2 availability 448 kt 1 Cartonboard 387m m2 5 133 kt 2 Conta
Slide 15: Track record of profitable growth...
4 Track record of profitable growth... Revenue Revenue CAGR % 15.0 Plastics1 5,718 5,180 5,237 EBITDA CAGR % 18.8 3,836 Rm 2,846 3,059 Underlying EBIT CAGR % 13.4 2005 to 2010 Ave EBITDA Margin % 12.9 Ave EBIT Margin % 8.3 2005 2006 2007 2008 2009 2010 Group Revenue (Excl Paperlink) EBITDA and EBIT
Slide 16: ...delivered by an experienced management team
4 ...delivered by an experienced management team Bruce Strong (42) CEO Current management team has been CEO Mpact since March 2009 behind the success of Mpact Former GM Packaging and Industrial Paper 16 years experience in paper and packaging, both locally and in Europe Decentralised struc
Slide 17: Opportunities for continued growth
5 Opportunities for continued growth Optimise existing operations to realise full potential Plastics Grow market share in key product segments / potential growth into Africa Optimise Grow Plastics Grow where we are able to extract value through business and operational management expertise as
Slide 18: Interim results summary
Interim results summary 18 │ Analyst & investor site visits │ 15&16 November 2011
Slide 19: Operating Financial Highlights – as at Interim Results
Operating Financial Highlights – as at Interim Results % Change % Change R’Millions H1 2010 H2 2010 H1 2011 (vs H1 (vs H2 2010) 2010) Group Revenue 2,968 3,290 3,006 1.3% (8.6)% EBITDA1 332 473 356 7.2% (24.7)% EBITDA margin % 11.2% 14,4% 11,8% 5,3% (18,1%) Underlying operating Profit2 176 310 198 1
Slide 20: Outlook – as at Interim Results
Outlook – as at Interim Results • Net earnings in H2 are expected to be enhanced by debt reduction on July 5th. • Due to seasonality trading in H2 is typically better than H1. • Concern about demand in H2 – consumer uncertainty, economic weakness, rand strength. • Net effects of industrial action in
Slide 21: Paper packaging
Paper packaging Business overview 21 │ Analyst & investor site visits │ 15&16 November 2011
Slide 22: Paper business overview
Paper business overview Divisions : Recycling Standard and customised cases Cartonboard : Packaging and Industrial Paper : Corrugated Key products : Cartonboard : Containerboard : Retail ready packaging : Regular slotted cartons Containerboard : POS packaging and displays : Die cut solutions Key cus
Slide 23: Recycling
Recycling Geographic footprint1 Customer base (2010) Key competitors Sappi MSN2 and others, 25% Nampak Pretoria Johannesburg Midrand Kimberly Clark Ekurhuleni Lothlorien Richards Bay Gayatri Durban Independents Internal consumption, 75% East London 448k tons Cape Town Port Elizabeth Collected volume
Slide 24: Paper manufacturing
Paper manufacturing Geographic footprint Customers Geographic sales Containerboard and cartonboard packaging converters (internal and external) Johannesburg Export, 17% Domestic, 83% Ekurhuleni Piet Retief Richards Bay Felixton Durban East London Cape Town Port Elizabeth Production capacity in kt
Slide 25: Corrugated Packaging
Corrugated Packaging Geographic footprint Customers Overview Localised customer base 3 high graphic printing machines Customers include producers of situated in Springs, Pinetown and Windhoek1 Nelspruit Brakpan Maputo1 agricultural, food durable and non durable Epping which offer high quality
Slide 26: Plastics packaging
Plastics packaging Business overview 26 │ Analyst & investor site visits │ 15&16 November 2011
Slide 27: Plastics business overview
Plastics business overview PET Preforms, Bottles and Jars Key products : PET preforms, bottles and jars : Plastic jumbo bins, wheelie bins, plastic crates : Plastic containers such as bottles, jars, closures, with in mould labelling capability : Styrene trays, fast food containers and clear plastic
Slide 28: Plastics segment overview (cont'd)
Plastics segment overview (cont’d) Geographic footprint Customer base (2010) Harare Home care, 6.4% Other, 0.9% Agricultural, 6.9% Beverage, 27.4%1 Brits Pretoria Personal care, 7.9% Johannesburg Robertville Wadeville Retail, 9.4% Pinetown Durban Food, 22.6% Distributors, 18.6% East London Atlantis