Ontex Group N.v. · EURONEXT:ONTEX
Ontex — Ontex Group Nv Ord — FY 2023 Earnings Presentation
23 slides from Ontex's earnings presentation, Feb 8, 2024
Slide 1: Full Year & Q4 Results 2023
FULL YEAR & Q4 RESULTS 2023 February 8, 2024 Full year & Q4 results 2023 – 08/02/2024 1
Slide 2: Disclaimer
DISCLAIMER Forward-looking statements Accounting changes This presentation may include forward-looking statements. Forward-looking Continuing operations encompass the statements are statements regarding or based upon our management’s Group’s Core Markets. As from 2022, current intentions, beliefs or
Slide 3: Business Review
BUSINESS REVIEW GUSTAVO CALVO PAZ CEO Full year & Q4 results 2023 – 08/02/2024 3
Slide 4: LFL growth & solid margin recovery in 2023
LFL GROWTH & SOLID MARGIN RECOVERY IN 2023 Drives positive FCF and successful deleveraging Adj. EBITDA Revenue FCF [1] Leverage margin €1.8bn 10% €9M 3.3X +10% +3.5pp vs €(115)M vs 6.4x YOY LFL YOY in 2022 in Dec 2022 Core Markets Total Group [1] FCF after financing [2] Total Group includes continui
Slide 5: Solid revenue growth
SOLID REVENUE GROWTH By strengthening volume & managing price Revenue +10% LFL growth, LFL 1,795 Core Markets 1,672 Revenue, Core Markets (in €M) 2022 2023 LFL = Like-For-Like, i.e. excluding forex fluctuations and scope effects Full year & Q4 results 2023 – 08/02/2024 5
Slide 6: 6th consecutive quarterly adj. EBITDA improvement
6TH CONSECUTIVE QLY ADJ. EBITDA IMPROVEMENT Driven mainly by cost transformation program delivery 9.7% 10.4% 9.7% Adj. EBITDA 9.5% 9.1% margin, 8.8% Core Markets 6.2% 47 43 44 40 41 5.4% 5.6% 4.8% Adj. EBITDA, 24 Core Markets 21 (in €M) 19 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 22 22 2022 22 22 23 23 2023 23 23 Fu
Slide 7: Maintaining 5% operating cost reduction
MAINTAINING 5% OPERATING COST REDUCTION With cost transformation program delivering €72M 5.1% YOY operating 4.9% cost reduction in %, Core Markets 72 56 Gross operating cost reduction, Core Markets (in €M) 2022 2023 YOY = Year-On-Year Full year & Q4 results 2023 – 08/02/2024 7
Slide 8: Strong cash enables self-funded investment in cost transformation
STRONG CASH ENABLES SELF-FUNDED INVESTMENT IN COST TRANSFORMATION PROGRAM & BUSINESS EXPANSION While ensuring FCF [1] remains positive ~5% Capex / revenue, Core Markets 96 ~3% 62 Capex, Total Group (in €M) 2022 2023 [1] FCF after financing cash-out Full year & Q4 results 2023 – 08/02/2024 8
Slide 9: Strengthening the balance sheet
STRENGTHENING THE BALANCE SHEET Accelerating the deleveraging over 2023 6.4x Leverage ratio, Total Group 867 3.3x 665 Net financial debt, Total Group (in €M) 12/2022 12/2023 Leverage = net debt / last-twelve-months adj. EBITDA Full year & Q4 results 2023 – 08/02/2024 9
Slide 10: Financial Review
FINANCIAL REVIEW GEERT PEETERS CFO Full year & Q4 results 2023 – 08/02/2024 10
Slide 11: Revenue growth driven by pricing
REVENUE GROWTH DRIVEN BY PRICING Volume growth in selected categories FY revenue, Core Markets (in €M) 1,834 1,795 Solid volume growth in selected 1,672 +0% +9% +10% -2% +7% categories, while overall volume stable Retail brands gain market share in slower European market Baby care FY Adult care
Slide 12: Cost transformation drives adj. EBITDA growth
COST TRANSFORMATION DRIVES ADJ. EBITDA GROWTH Sustained pricing helps offset cost inflation & forex headwinds FY adj. EBITDA, Core Markets (in €M) +156 -67 -8 Cost transformation main driver -44 Solid delivery of cost transformation -10 -43 174 program, with 5% cost reduction for 2nd +78 +72 +67
Slide 13: Profit and EPS turning positive
PROFIT AND EPS TURNING POSITIVE Driven by strong adj. EBITDA recovery in Core & Emerging Markets Condensed P&L (in €M) 2022 2023 D&A in line with 2022, despite stepping up investments Revenue 1,672.2 1,794.7 EBITDA adjustments for optimization of European footprint and Adj. EBITDA 104.0 173.9 pr
Slide 14: Positive FCF, strong improvement YoY
POSITIVE FCF [1], STRONG IMPROVEMENT YOY EBITDA increase allows for investment ramp-up FY adj. EBITDA to FCF bridge (in €M) 223 -36 Working capital [2] changes of €36M Discont. +27 -121 Higher price-driven receivables and ops. -21 lower factoring 49 Leases WC (25) Lower raw-materials-driven pa
Slide 15: Net financial debt reduced by 23%
NET FINANCIAL DEBT REDUCED BY 23% Financing secured until end 2025 Financial debt (in €M) €220M term loan repaid in Q2 (867) +9 +200 168 (834) FCF after (115) RCF [3] €270-243M [3] RCF extended financing -7 (665) to Dec 2025, providing flexibility M&A net Other Cash proceeds [1] €115M drawn
Slide 16: Outlook
OUTLOOK GUSTAVO CALVO PAZ CEO Full year & Q4 results 2023 – 08/02/2024 16
Slide 17: Ontex strategy accelerated
ONTEX STRATEGY ACCELERATED #1 Leadership in trusted partner Europe & North America for retail & healthcare brands in baby, feminine & adult care Full year & Q4 results 2023 – 08/02/2024 17
Slide 18: Our value creation drivers
OUR 3 VALUE CREATION DRIVERS Keep laser focus on core business Be fastest A-brand equivalent Competitive & Align product platforms Sustainable Develop more sustainable product design Innovation Grow in selected product categories in Europe Grow double- Drive cost-efficient operations dig
Slide 19: Value creation drivers complement each other
VALUE CREATION DRIVERS COMPLEMENT EACH OTHER Creating synergies Customer De-complexi- intimacy Competitive & fication Sustainable Fast-follow Agile indus- innovation Innovation trialization Business Best-In-Class Expansion Operations DreamShield® Best value offering Deployment at scale F
Slide 20: Accelerated investments in excess of 6%
ACCELERATED INVESTMENTS IN EXCESS OF 6% [1] While preserving positive FCF generation Research & development Competitive & and technical upgrades to Sustainable production lines Innovation Capacity expansion in North America and in selected product categories New production lines to upgrade mac
Slide 21: 2024 Outlook
2024 OUTLOOK Further progress on our 3-year journey Core Markets Total Group Revenue Adj. EBITDA Leverage FCF [1] LFL growth margin ratio Low single digit 11-12% > €9M < 3.0X On strong double- Supported by cost While investing With comfortable digit growth in transformation >6% of revenue he
Slide 22: Q&A
Q&A GUSTAVO CALVO PAZ GEERT PEETERS CEO CFO Full year & Q4 results 2023 – 08/02/2024 22
Slide 23: Thank you
THANK YOU Full year & Q4 results 2023 – 08/02/2024 23