Slide 1: Forward-looking statements
Certain statements contained in this document are "forward-looking statements" intended to qualify for the safe harbor from liability established by the Private Securities Litigation Reform Act of 1995. These forward-looking statements, and financial or other business targets, are subject to certain
Slide 2: Use of Non-GAAP Financial Measures
Use of Non-GAAP Financial Measures This presentation contains certain non-GAAP financial measures as defined by SEC rules. We report our financial results in conformity with accounting principles generally accepted in the United States of America, or GAAP, and also communicate with investors using c
Slide 3: Full Year Overview
Full Year Overview Delivered double-digit EPS growth, above expectations Reported EPS of $3.54; up 20% Adjusted EPS (non-GAAP) of $4.02; up 17% Strong topline performance driven by accelerated growth in high value categories and disciplined execution in the base Reported sales growth of 2% (~4% orga
Slide 4: Full Year Overview (cont.) and Outlook
Full Year Overview (cont.) and Outlook Label and Graphic Materials delivered another year of strong organic sales growth and margin expansion Retail Branding and Information Solutions delivered solid organic growth while accelerating margin expansion Continued strength in RFID and solid volume growt
Slide 5: Realigned reporting segments to reflect new operating structure
Realigned reporting segments to reflect new operating structure Label and Graphic Materials (LGM) $4.2 bil.(1) Retail Branding and Information Solutions (RBIS) $1.4 bil.(1) Industrial and Healthcare Materials (IHM) $0.5 bil. (1) Label and Packaging Materials(2) Graphics Solutions(2) Reflective Solut
Slide 6: Full year segment results
Full year segment results ($ in millions) New Segments Net Sales Rptd. Sales Change GAAP Oper. Income GAAP Oper. Margin LGM $4,187 4% LGM $516 12.3% RBIS $1,445 0% RBIS $103 7.1% IHM $454 -8% IHM $55 12.0% Previous Segments Segment New Segments Net Sales Org. Sales Change Adj. Net Sales Org. Sales C
Slide 7: Fourth Quarter Overview
Fourth Quarter Overview Fourth quarter EPS above expectations driven by strong sales growth Reported sales of $1.55 bil., up approximately 7% compared to prior year Sales growth (ex. currency) of 8% Organic sales growth of ~5% Operating margin, as reported, improved 180 basis points, primarily due t
Slide 8: Fourth Quarter Segment Overview
Fourth Quarter Segment Overview Label and Graphic Materials Reported sales of $1.06 bil., up approximately 10% compared to prior year Sales up ~7% on organic basis Sales in Label and Packaging Materials increased mid-single digits and the combined Graphics and Reflective businesses increased low-dou
Slide 9: Fourth Quarter Segment Overview
Fourth Quarter Segment Overview Industrial and Healthcare Materials Reported sales of $111 mil., down approximately 8% compared to prior year Sales down ~10% on an organic basis, as expected Strong growth in industrial was more than offset by expected decline in healthcare categories Operating margi
Slide 10: On track to achieve 2018 targets
On track to achieve 2018 targets 4% – 5% CAGR(1) Organic Sales Growth 9%–10% in 2018 Operating Margin 16%+ in 2018 Return on Total Capital (ROTC) 12% – 15%+ CAGR(1) Adjusted(2) EPS Growth 1.7x to 2.0x Net Debt to Adjusted(2) EBITDA 2014 – 2018 TARGETS 4% 3 Yr CAGR 8.8% in 2016 Adj(2): 9.9% in 2016 1
Slide 11: Contributing Factors to 2017 Results
Contributing Factors to 2017 Results Reported net sales change of 1.5% to 3.0%: Ex. currency sales growth of 4.5% to 6.0% Organic sales growth of 3.0% to 4.0% Currency translation EBIT headwind of ~$22 mil., assuming recent rates Incremental savings of $40 mil. to $50 mil. from restructuring actions
Slide 12: Appendix A: Supplemental segment results
Appendix A: Supplemental segment results
Slide 13: Historical trends – new reporting segments
Historical trends – new reporting segments (1) Excludes severance and related costs, asset impairment and lease cancellation charges, and other items. ($ in millions) FY12 FY13 FY14 1Q15 2Q15 3Q15 4Q15 FY15 1Q16 2Q16 3Q16 4Q16 FY16 Label and Graphic Materials Reported Sales $ 3,959.8 $ 4,137.3 $ 4,2
Slide 14: Fourth quarter segment results
Fourth quarter segment results ($ in millions) New Segments Net Sales Rptd. Sales Change GAAP Oper. Income GAAP Oper. Margin LGM $1,064 10% LGM $121 11.3% RBIS $376 3% RBIS $35 9.3% IHM $111 -8% IHM $10 8.8% Previous Segments Segment New Segments Net Sales Org. Sales Change Adj. Net Sales Org. Sales
Slide 15: Fourth Quarter Segment Sales and Margins
Fourth Quarter Segment Sales and Margins 4Q16 Reported Organic Sales Change: Label and Graphic Materials 10% 7% Retail Branding and Information Solutions 3% 5% Industrial and Healthcare Materials (8)% (10)% Total Company 7% 5% Adjusted As Reported (Non-GAAP) 4Q16 4Q15 4Q16 4Q15 Operating Margin: Lab
Slide 16: Full Year Segment Sales and Margins
Full Year Segment Sales and Margins FY16 Reported Organic Sales Change: Label and Graphic Materials 4% 5% Retail Branding and Information Solutions 0% 3% Industrial and Healthcare Materials (8)% (8)% Total Company 2% 4% Adjusted As Reported (Non-GAAP) FY16 FY15 FY16 FY15 Operating Margin: Label and
Slide 17: Appendix B: Reconciliation of GAAP to Non-GAAP Financial Measures
Appendix B: Reconciliation of GAAP to Non-GAAP Financial Measures
Slide 18: Organic Sales Change (new segments)
Organic Sales Change (new segments) Totals may not sum due to rounding and other factors. Label and Graphic Materials FY12 FY13 FY14 1Q15 2Q15 3Q15 4Q15 FY15 1Q16 2Q16 3Q16 4Q16 FY16 Reported sales change -1% 4% 4% -2% -6% -6% -11% -6% -2% 3% 5% 10% 4% Estimated change in sales due to: Foreign curre
Slide 19: Reconciliation of Adjusted Operating Margin (new segments)
Reconciliation of Adjusted Operating Margin (new segments) ($ in millions) Label and Graphic Materials Reconciliation of Operating Margins: FY12 FY13 FY14 1Q15 2Q15 3Q15 4Q15 FY15 1Q16 2Q16 3Q16 4Q16 FY16 Net Sales $ 3,959.8 $ 4,137.3 $ 4,298.7 $ 1,032.9 $ 1,029.0 $ 999.6 $ 970.6 $ 4,032.1 $ 1,012.6
Slide 20: Reconciliation of Adjusted Operating Margin (new segments)
Reconciliation of Adjusted Operating Margin (new segments) ($ in millions) Industrial and Healthcare Materials Reconciliation of Operating Margins: FY12 FY13 FY14 1Q15 2Q15 3Q15 4Q15 FY15 1Q16 2Q16 3Q16 4Q16 FY16 Net Sales $ 441.1 $ 467.8 $ 515.6 $ 126.3 $ 122.8 $ 121.3 $ 121.0 $ 491.4 $ 113.4 $ 118
Slide 21: Organic Sales Change (Total Company)
Organic Sales Change (Total Company) Totals may not sum due to rounding and other factors. ($ in millions) 3-Yr CAGR 2013 2014 2015 2016 Net sales $6,140.0 $6,330.3 $5,966.9 $6,086.5 Reported sales change 3.1% -5.7% 2.0% Foreign currency translation 1.1% 8.6% 2.6% Sales change (ex. currency) 4.2% 2.
Slide 22: Adjusted Net Income and Adjusted EPS
Adjusted Net Income and Adjusted EPS GAAP adjustment for prior periods reflects the previously disclosed impact of the third quarter of 2015 revision to certain benefit plan balances, which had an immaterial impact to the non-GAAP amounts. Net Income ($ in millions) 2013 2014 2015 2016 As reported n
Slide 23: Return on Total Capital (ROTC)
Return on Total Capital (ROTC) ($ in millions) 2015 2016 As reported net income from continuing operations $ 320.7 Interest expense, net of tax benefit $ 40.3 Effective Tax Rate 32.8% Income from continuing operations, excluding expense and tax benefit of debt financing (non-GAAP) $ 361.0 Total debt
Slide 24: Net Debt to Adjusted EBITDA
Net Debt to Adjusted EBITDA GAAP adjustment for prior periods reflects the previously disclosed impact of the third quarter of 2015 revision to certain benefit plan balances, which had an immaterial impact to the non-GAAP amounts. 4-pt ($ in millions) 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 Avg. Net
Slide 25: Net Debt to Adjusted EBITDA
Net Debt to Adjusted EBITDA at (Sinmitions) sors _2ats__sars__aans_— tars zate sate gate avg. Net sales S15280 S15180 $14681 $14548 $14055 S1S415 $18087 $15508, [As ported netincome S19 $ 637 $ B17 $ S70 $ 896 $ 80 $ BB1 $ 620 Interest expense S$ 153 $ 153 $ 47 $ 152 $ 153 $ 154 $ 47 $ 45 brcome tax
Slide 26: Avery Dennison
A AVERY Inspired Brands. DENNISON intelligent World” of Avery Denniton Corporation. Al company names nd ier naraton on