Glanbia Plc · EURONEXT:GL9
Glanbia — Barclays Global Consumer Staples Conference 2018
35 slides from Glanbia's conference presentation, Sep 4, 2018
Slide 1: Focus on Growth
Focus on Growth Barclays Global Consumer Staples Sept 4th 2018 Siobhán Talbot Group MD
Slide 2: Important Notice
Important Notice This presentation contains forward-looking statements. These statements have been made by the Directors in good faith based on the information available to them up to the time of their approval of this presentation. Due to the inherent uncertainties, including both economic and busi
Slide 3: At a glance
At a glance Market cap 2017 Total Group revenues €4.3bn €3.6bn Employees 2017 Total Group EBITA 6,600 €351m Countries Products sold or distributed in over 32 130 countries 3
Slide 4: Our business in 2017
Our business in 2017 Total Group Revenues EBITA €3.6bn* Activity Margin GPN Performance & lifestyle consumer branded €1.1bn portfolio WHOLLY OWNED Mid teens Nutritional Solutions Value added €0.5bn formulations GN US Cheese €0.7bn Mid Dairy single SHARE OF REVENUE Joint Ventures digits €1.3bn *Pro f
Slide 5: Strong record of delivery
Strong record of delivery 10 Year Earnings wholly-owned wholly- per share margin owned revenues 2007- 2017 2007 - 2017 +630 bps 11.9% CAGR Wholly-owned margin Adjusted Earnings per share 15% 100.00c 80.00c 10% 60.00c 40.00c 5% 20.00c 0% 0.00c 2007 2009 2011 2013 2015 2017 2007 2009 2011 2013 2015 20
Slide 6: Trends driving our business
Trends driving our business Aligning our business to consumer and customer needs Health and On-the-go food Digitally Clean wellness and beverages connected labelling $1tr 94% $4.5 tr 93% Global health and of American consumers online retail sales of US households have wellness sales hit reach for a
Slide 7: Glanbia Nutritionals
Glanbia Nutritionals
Slide 8: Glanbia Nutritionals (GN): at a glance
Glanbia Nutritionals (GN): at a glance 2017 Revenue #1 2,000 €1,266m Global supplier of whey protein isolate Employees #1 #2 Sales presence in Producer of American style cheddar cheese Global micro nutrient premix 19 countries 8 GLANBIA NUTRITIONALS
Slide 9: GN financials
GN financials Revenue (€’m) 1,075 1,175 1,218 1,224 1,266 2017 Revenue US Cheese €734m 2013 2014 2015 2016 2017 EBITA (€’m) 111 114 102 100 107 Nutritional Solutions €532m 2013 2014 2015 2016 2017 US Cheese Nutritional Solutions 9 GLANBIA NUTRITIONALS
Slide 10: Cheese
Cheese 10 GLANBIA NUTRITIONALS
Slide 11: Cheese overview
Cheese overview 2017 Revenue #1 Producer of American style cheddar cheese €1.5bn 20% Share of US Cheddar Cheese Market Wholly Owned Southwest Cheese 11 GLANBIA NUTRITIONALS
Slide 12: US Cheese footprint
US Cheese footprint 2018 2021 Michigan 470k 602k Central Michigan 2021 Idaho Cheese volume (tonnes) Gooding Twin Falls / Blackfoot Key attributes: Largest player Cheese Innovation Centre Clovis Most efficient producer Incubation plants for Innovations New Mexico Customer Categories: Brands Foodservi
Slide 13: Unique operating model
Unique operating model Pioneered at SWC, building upon that in Michigan JV operating model Impact on Plc Consistent income stream Strategic Milk Outlet • Dividends • Commissions • Our share of Profit After Tax Competitive milk price Strong returns on equity Share in business invested Strategic Milk
Slide 14: Nutritional Solutions
Nutritional Solutions 14 GLANBIA NUTRITIONALS
Slide 15: NS Overview
NS Overview 2017 #1 #2 Revenue Whey protein Global Isolate Premix 61% €325m €532m 39% €207m NS 6% Volume Average Growth (5 yr average) Non-dairy Dairy 15 GLANBIA NUTRITIONALS
Slide 16: What makes us unique
What makes us unique 16 GLANBIA NUTRITIONAL
Slide 17: Nutritional Solutions: Our portfolio & differentiators
Nutritional Solutions: Our portfolio & differentiators Protein Custom Bioactives Plant Aseptic beverage Flavours Micronutrient solutions nutrient premixes nutrition manufacturing straights Deep Accelerated Trusted Quality formulation Innovation Supply Chain Assurance expertise Capability Integrated
Slide 18: Where we play
Where we play Sports & Supplements Mainstream Clinical Infant Lifestyle food nutrition nutrition nutrition & beverage End–market growth rate in the mid-single digit range Source: Euromonitor 18 GLANBIA NUTRITIONALS
Slide 19: Growth Drivers
Growth Drivers Nutritional Solutions Build on core Leverage Scale Scale plant strength in extensive flavours nutrition premix protein & bioactives capability into healthy snacking 19 GLANBIA NUTRITIONALS
Slide 20: Glanbia Performance Nutrition
Glanbia Performance Nutrition
Slide 21: Who we are
Who we are €1.1Bn 7.3% average volume #1 growth 2013-2017 25 2,350 8 Brands end market people teams worldwide 21 GPN
Slide 22: GPN financials
GPN financials Revenue growth (€’m) 1121 1008 923 746 655 Constant Average Volume Currency Growth 7.3% 2013 2014 2015 2016 2017 Note: Revenue on a reported basis. EBITA growth (€’m) 162 170 136 89 Constant 71 Currency Average Margin 13.7% 2013 2014 2015 2016 2017 Note: EBITA on a reported basis 22 G
Slide 23: Business builders
Business builders $185m* Revenue $135m* Revenue $93m* Revenue $84m* Revenue $116m* Revenue Total acquisition revenue Organic growth $687m $1.3 bn Revenue $614m 2008 2011 2014 2015 2017 *Annual revenue at the point of acquisition 23 GPN
Slide 24: Our market
Our market 2017 Performance Nutrition addressable market ROW Constant GPN market Currency 34% share 13% North $13bn America in value (RSP) 66% Constant Global market Currency growth rate MSD% Source: Euromonitor/Glanbia estimates 24 GPN
Slide 25: 2017 Revenue by Region, Channel and Format
2017 Revenue By Region, by Channel and Format Regional Mix Channel Mix Format Mix 100% 100% 100% 100% 100% 100% FDMC CAPS/TABS 4% 5% 10% 16 RTD 5% 4% % RTE 5% 22 16% Online Energy 15% % 26 North 65% 62% % 15% America RTM 32 Distributor % 30 % Protein 71% 60% 38% 36 Rest of the 35% 28 Specialty % Wor
Slide 26: Growth drivers
Growth drivers 2017 2022 Innovation Win in omni- Invest in Accelerate Selective channel digital International M&A 26 GPN
Slide 27: Joint Ventures
Joint Ventures 27
Slide 28: Joint Venture Growth Ambition
Joint Venture Growth Ambition 2017 Revenue** €1.2bn 2022 Revenue** €1.9bn Glanbia Cheese JV Structure SouthWest Cheese SouthWest UK & Glanbia Cheese Cheese EU* Glanbia Cheese UK Glanbia Michigan* Glanbia Ireland Ireland Growth Drivers New Capacity 1. Mid-to-high single digit volume growth 1. Glanbia
Slide 29: Group Strategy
*: Group al oe Strategy > glanbia
Slide 30: Refreshed Group Strategy
Refreshed Group Strategy Our Purpose Our Vision To deliver better To be one of world’s top nutrition for every step performing nutrition companies of life’s journey trusted to enrich lives every day Global Macro Trends Health and On-the-go food Digitally Clean wellness and beverages connected labell
Slide 31: Our growth ambition by 2022 to be a €5bn Group
Our growth ambition by 2022 to be a €5bn Group Average EBITA Margin 2022 revenue 2018 to 2022 GPN €1.6bn 13% - 15% WHOLLY OWNED Nutritional Solutions €0.8bn 14% - 16% US Cheese €0.7bn Mid single SHARE OF REVENUE digits Joint Ventures €1.9bn 31
Slide 32: 2018 to 2022: Growth, Cash conversion & Returns
2018 to 2022: Growth, Cash conversion & Returns Constant EPS1 Currency 5% - 10% Constant Cash Constant ROCE Currency conversion Currency 10% - 13% >80% Constant Dividend Currency pay-out 25% - 35% 1 Average adjusted EPS on a constant currency basis over the 2018 – 2022 period 32
Slide 33: Performance & Ambition – KPI's
Performance & Ambition – KPI’s Track Long-term 2018 record ambition guidance 2014-2017 2018-2022 2018 Cash Conversion 82.9% > 80% > 80% ROCE 13.9% 10% - 13% 10% - 13% Adjusted EPS 10.5% 5% - 10% 5% - 8% Dividend Pay-out Ratio 18.4% 25% - 35% 25% - 35% 33
Slide 34: Focus on growth
Focus on growth Powerful consumer trends driving business Group focused and aligned to drive growth Strong track record of delivery Ambition for future growth Significant financial resources to invest 34
Slide 35: Questions
Questions 35
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