Edgewell Personal Care Company · NYSE:EPC
Edgewell Personal Care — BofA Securities 2020 Leveraged Finance Virtual Conference
35 slides from Edgewell Personal Care's conference presentation, Dec 1, 2020
Slide 1: BofA Securities 2020 Leveraged Finance Virtual Conference
BofA Securities 2020 Leveraged Finance Virtual Conference December 1, 2020 • PAGE 1
Slide 2: Forward-looking statements
Forward-looking statements Unless the context otherwise requires, references in this presentation to “Edgewell,” “we,” “our,” and “the Company” refer to Edgewell Personal Care Company, a Missouri corporation, and its consolidated subsidiaries. Forward-looking statements are not based on historical f
Slide 3: Non-GAAP financial measures
Non-GAAP financial measures While the Company reports financial results in accordance with accounting principles generally accepted in the U.S. ("GAAP"), this discussion also includes non-GAAP measures. These non-GAAP measures are referred to as "adjusted“, "organic" or “underlying” and exclude item
Slide 4: Overview
Overview Section 1: welcome and introduction Page 4 BOS 20201120 EPC investor da ... 1-6 v3
Slide 5: Key takeaways for today
Key takeaways for today A strong core: Focused on stabilization: We have high quality brands, strong Over the last 18 months, we have solidified financial fundamentals and unique our topline performance, divested non-core manufacturing capabilities businesses and executed on our cost savings program
Slide 6: Strong Brands in Compelling Categories
Strong Brands in Compelling Categories Men’s Women’s Grooming Feminine Care Sun Hygiene Page 6 BOS 20201120 EPC investor da ... 1-6 v3
Slide 7: We have globally scaled operational and commercial capabilities
We have globally scaled operational and commercial capabilities Global sourcing World class Flexible, efficient Commercial capabilities manufacturing supply chain Innovation and R&D capabilities Sourcing of Best in class Quick supply chain that Leading edge innovation Access to scale markets high gr
Slide 8: We've been taking bold actions to better position our business
we’ve been taking bold actions to better position our business… Page 8 BOS 20201120 EPC investor da ... 1-6 v3
Slide 9: We have reshaped our leadership team
We have reshaped our leadership team… With the best of both legacy EPC… …and new execs with broader experiences in key roles Nick Powell Dan Sullivan President, International 16 years at Chief Financial Officer Anne-Sophie Gaget Eric O’Toole Chief Growth & 18 years at President, North Innovation Off
Slide 10: We are over-delivering on aggressive cost reduction targets
We are over-delivering on aggressive cost reduction targets Stronger operating model Simplified organization Improved manufacturing & RTM $270M $53M 14% projected expected labor cost operations footprint gross cost savings from Fuel reduction reduction Note: Edgewell internal financials Page 10 BOS
Slide 11: We have forged expanding retail partnerships
We have forged expanding retail partnerships Page 11 BOS 20201120 EPC investor da ... 1-6 v3
Slide 12: We have made portfolio-shaping M&A decisions
We have made portfolio-shaping M&A decisions ACQUIRED DIVESTED We’ve successfully utilized M&A to fill category needs/complement category strengths and bolster capabilities Page 12 BOS 20201120 EPC investor da ... 1-6 v3
Slide 13: We are honing our capabilities
We are honing our capabilities… We are balancing the organization to maximize the impact of our capabilities and get talent in areas we are missing Digital and e-commerce Consumer led Innovation Brand building Sustainability marketing Page 13 BOS 20201120 EPC investor da ... 1-6 v3
Slide 14: We've stabilized our business
We’ve stabilized our business… Flat topline 45% ~$190M Stable organic run rate 2020 Gross Margin flat to PY 2020 Free Cash Flow Generation Note: Edgewell internal financials as of October 2020. Cash flow after accounting for Infant sale/Cremo acquisition. Page 14 BOS 20201120 EPC investor da ... 1-6
Slide 15: Our strategy
our strategy Page 15 BOS 20201120 EPC investor day mate ...
Slide 16: Page 16
Page 16 BOS 20201120 EPC investor da ... 1-6 v3
Slide 17: Sustainable Topline Growth
Sustainable Topline Growth Accelerate growth Stabilize the Profit Pool in categories with brands that give us a Right to Win in categories with brands that give us a Right to Play Sun International U.S. Feminine Men’s Grooming Personal Hygiene and Skin Shave Shave Care Growing market share Steadily
Slide 18: Accelerate Growth: Our Right to Win
Accelerate Growth: Our Right to Win We have leading positions in categories, with our brands that have a clear right to continue winning Proof Points for Growth Profile 59% 2x Wet Ones grew to a $100M brand in 2020 (+65%), and with secured capacity to meet durable demand and expanded usage Double th
Slide 19: Stabilize the Profit Pool: Our Right to Play
Stabilize the Profit Pool: Our Right to Play We have solid positions in categories where our brands have a clear right to continue to play… Proof points for Stabilization Rearchitecting Hydro and Wilkinson-sword 23% Flat to slightly down brands, consumer-centric innovation pipeline and expanded DTC
Slide 20: A new organic growth outlook for our Portfolio
A new organic growth outlook for our Portfolio Historical Today Trajectory By 2023 + mid single Accelerate Growth digits 1/4 25 10-15% 1/3 33 Portfolio growth trend of our business growth trend of our business - mid single Stabilize Profit Pool digits 3/4 75 Flat to -1% 2/3 67 Portfolio growth trend
Slide 21: Our long-term financial profile
our long-term financial profile Page 21 BOS 20201120 EPC investor day mate ...
Slide 22: Sustainable model required transformation
Sustainable model required transformation Stable and Predictable Stabilized Gross Margin Continued Robust Free Cash Underlying Topline Profile Flow Page 22 BOS 20201120 EPC investor day mate ...
Slide 23: We have a growth outlook for 2021
We have a growth outlook for 2021 Flat Core Portfolio Accelerated Wet Ones COVID uncertainty; likely Continued strong Free Cash Organic net sales drives organic growth gradual recovery Flow profile Low single Mid single ~$60M ~$150M digit organic net sales growth digit adjusted EBITDA Growth Project
Slide 24: Driving Sustainable Value
Driving Sustainable Value Deliver Organic Topline Growth We’re on the right track Reshaped portfolio as the catalyst for sustainable organic growth Stabilized underlying top and Save to Strategically Invest bottom line performance Continued savings initiatives fund disciplined reinvestment in brands
Slide 25: A Balanced Portfolio for Sustainable Growth
DELIVER TOPLINE GROWTH A Balanced Portfolio for Sustainable Growth Total Right to Win Right to Play Edgewell Organic Net 10 – 15% Sales Growth Outlook +2-3% Growth Flat to -1% Note: Internal management estimates. Page 25 BOS 20201120 EPC investor day mate ...
Slide 26: Addressing our Cost Base
S AV E TO S T R AT E G I C A L LY I N V E S T Addressing our Cost Base Poised to significantly over-deliver original expectations ($225-240M) ~75% of the gross savings within COGS and ~25% in Overheads Net realization slightly below expectations given lower volumes and inflationary pressures Page 26
Slide 27: Continuous Cost Improvement
Continuous Cost Improvement Page 27 BOS 20201120 EPC investor day mate ...
Slide 28: Strategically Investing in Growth
S AV E TO S T R AT E G I C A L LY I N V E S T Strategically Investing in Growth Prioritizing Strategic Digitally Enabled Brand Investment Innovation Platform Markets Consumer Centricity Develop end to end consumer An investment stance behind our Developing a consumer-centric, Focus on markets with c
Slide 29: Strengthened Gross Margins
DRIVE CONSISTENT GROSS MARGIN PERFORMANCE Strengthened Gross Margins Strong track record of Enhanced revenue delivering cost savings management Margin accretive innovation Page 29 BOS 20201120 EPC investor day mate ...
Slide 30: Cash flow generation is strong
Cash flow generation is strong Page 30 BOS 20201120 EPC investor day mate ...
Slide 31: Balanced approach to Cash Priorities
P R I O R I T I Z E C A P I TA L A L LO C AT I O N Balanced approach to Cash Priorities Investing in our brands and growth opportunities, accretive M&A, Invest for growth capex for innovation and productivity Improve Capital Return Return of cash to shareholders through the initiation of a dividend
Slide 32: Returning capital to shareholders
Returning capital to shareholders Dividend $0.15 Quarterly Dividend per Share ~20% Initial Dividend Payout Ratio Opportunistic in nature Excess cash and price opportunity Page 32 BOS 20201120 EPC investor day mate ...
Slide 33: A New Algorithm
A New Algorithm Leveraging clear Right to Win 2% - 3% Disciplined, prioritized investment cadence Organic Net Sales growth Consumer centric innovation at the core Strengthened gross margin profile 4% - 6% Next level cost reduction Adjusted EBITDA growth Investment stance towards our brands 6% - 7% S
Slide 34: Key takeaways on our long-term financial profile
Key takeaways on our long-term financial profile Deliver Organic Topline Growth Clear and compelling Reshaped portfolio as the catalyst for sustainable organic growth strategy to drive consistent organic growth Save to Strategically Invest Continuous cost Continued savings initiatives fund disciplin
Slide 35: Q&A
Q&A Page 35 BOS 20201120 EPC investor da ... 1-6 v3
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