Brambles Limited · ASX:BXB
Brambles — Citigroup London Conference 2007
30 slides from Brambles's conference presentation, Mar 6, 2007
Slide 1: Citigroup London Conference
Citigroup London Conference 5-6 March 2007
Slide 2: David Turner, Chief Executive Officer
Citigroup London Conference David Turner Chief Executive Officer
Slide 3: Brambles Limited (BXB) Overview
Brambles Limited (BXB) Overview Sales1 • Primary listing is on ASX 16% CHEP – Market capitalisation Europe CHEP CHEP CHEP 35% RoW Europe » US$16bn3 RoW 11% » Top 15 listed stock • Operating in 45 countries CHEP Americas 38% CHEP Americas • ROCI4 of 22% FY06 CHEP Operating Recall • 45% of Group sales
Slide 4: Transformation complete
Transformation complete • Asset disposal program successfully completed • Unification completed • Delivered strong profit growth • Utilisation of cash – Special Dividend (US$434 million, October 2006) – Cash Alternative (US$950 million, December 2006) – On market buy-backs (US$158 million, 1H07) • P
Slide 5: Interim results - Summary
Interim results - Summary • Continuing operations – Sales revenue US$1.9bn (up 6%) – Comparable operating profit US$421m (up 20%) – PAT1 at US$271m (up 46%) – EPS1 16.7 US cents (up 54%) – Cash flow at US$311m (up US$66m) – BVA at US$196m (up US$59m) 1 Before special items Growth % calculated on US$
Slide 6: Business highlights
Business highlights • CHEP Americas – Sales growth 6%, profits up 31% – Further operational efficiencies • CHEP Europe – Sales growth 2%, profits up 5% – Increased costs – lumber (US$2m) and Brentwood closure (US$8m) • CHEP RoW – Sales growth 9%, profits up 13% • Recall – Integration of AUSDOC and k
Slide 7: Focus on CHEP
Focus on CHEP a2 4.32, 5, 3.4% 8 & ¢ ¢ ¢ ¢ ¢ é a. ‘ ¢ s . = ¢ ¢ a \ 2 ‘i Brambles
Slide 8: CHEP's product base
CHEP’s product base 2% 5% 6% Intermediate Bulk Containers (IBC) Automotive Containers & 87% Catalyst and Chemical Containers (CCC) Reusable Plastic Containers (RPC) Notes: Pallets 1 Percentages represent proportion of FY06 revenue earned by product type
Slide 9: Excellent mix of mature, growth and infant markets
Excellent mix of mature, growth and infant markets Mature Growth Infant Exposure to a mixture of mature and growth markets
Slide 10: Penetration in FMCG channel
Penetration in FMCG channel 1979 100 Pool first started +16% 1958 90 Sales growth FY06 (constant currency) 1979 +8% 80 +10% Level of penetration (%) 70 60 50 1990 1975 +9% 40 +6% 30 1995 20 +32% 10 0 Latin America Europe USA Canada Asia-Pacific Africa Note: FMCG = Fast Moving Consumer Goods
Slide 11: Americas continues strong profit growth
Americas continues strong profit growth Comparable operating profit Actual Constant 1H07 1H07 1H06 Growth ROCI AIFRS US$m US$m US$m % % Americas 190.9 189.8 145.0 31 29 Europe 132.7 122.6 117.3 5 20 RoW 61.6 62.7 55.5 13 39 Total 385.2 375.1 317.8 18 26 Growth % calculated on US$ constant currency b
Slide 12: Excellent cash flow from CHEP
Excellent cash flow from CHEP US$m Cash flow from operations 800 First half Second half 700 600 500 400 300 200 100 0 2004 2005 2006 2007 Year ended 30 June
Slide 13: Europe – focus on top line growth
Europe – focus on top line growth • Significant growth potential – Existing customers – Converting white wood customers » Increased cost of new white wood pallets – New geographies • Improving customer satisfaction – Service levels – Invoicing • On-going operational efficiencies – Perfect Plants – T
Slide 14: Americas – further network optimisation
Americas – further network optimisation • Total Pallet Management (TPM) evolving rapidly – Distributors/Emitters – Expanding footprint » 69 Service Centres, 129 TPM locations – Technology adapted for TPMs » Inspection and sorting – Embedded in customers’ premises – Favourably impacts network logisti
Slide 15: Perfect Plant technology into Es and Ds
Perfect Plant technology into Es and Ds Continuous Improvement • Perfect Plants – 8 commissioned in 1H07 » Europe (Swindon, Dublin) » Americas (Mexico City, Brampton - Canada, Atlanta) » RoW (Erskine Park, Kraaifontein, Bloemfontein) – 8 more in 2H07 – 12 Sorting modules at Es and Ds – 6 Facilities
Slide 16: Geographic expansion
Geographic expansion • Europe – Germany – Eastern Europe – Greece – Turkey • Americas – Central America • Rest of World – China – Gulf Co-operative States
Slide 17: CHEP wins 1st customer in China
CHEP wins 1st customer in China • Coca-Cola awards contract to CHEP – Shanghai region • Targeting customers – FMCG (Shanghai, Beijing and Guangzhou) – Automotive (Manufacturers and tier suppliers) • Plastic pallet – RFID enabled – Trials in progress with potential customers • Develop Distributor adv
Slide 18: Focus on Recall
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Slide 19: Sales by region and service
Sales by region and service By Region By Service 3% 11% 22% 49% 24% 65% 26% Americas Europe Document Management Solutions Australia/NZ Rest of World Secure Destruction Services Based on FY06 results Data Protection Services
Slide 20: North America delivering growth
North America delivering growth Actual Constant 1H07 1H07 1H06 Growth AIFRS US$m US$m US$m % Americas 146.5 144.7 133.5 8 Europe 77.3 71.3 71.6 Note1 RoW 84.3 82.6 57.5 44 Sales revenue 308.1 298.6 262.6 14 Comparable operating profit 50.0 48.3 38.1 27 Profit margin (%) 16 16 15 1 pp 1 The underlyin
Slide 21: Recall – solid improvement
Recall – solid improvement • Strong contract wins in North America – Bank of America, Chevron (Document Management Solutions) – JPMorgan – 50% of contract (Secure Destruction Services) • Focus on processes and costs • AUSDOC integration benefits
Slide 22: Capital Management
Capital Management • On-market share buy-backs continuing – 43 million shares since Unification1 – At a cost of US$440 million • Reviewing alternatives 1 As at 2 March 2007
Slide 23: Outlook for 2007
Outlook for 2007 • CHEP – another year of strong profit growth • CHEP Americas – Solid growth in sales and continuing very strong profit growth • CHEP Europe – Focus on acquiring new customers and operational efficiencies – Continued profit growth and good cash generation • CHEP RoW – continues to p
Slide 24: Beyond 2007
Beyond 2007 • CHEP Europe – Volume growth – Germany – TPM initiatives – Operating efficiencies • CHEP USA – More of the same – Efficiencies – Innovation • CHEP Elsewhere – Geographic expansion (Gulf Co-operative States, Latin America, China) • Recall – Converting revenue growth into profit and value
Slide 25: Disclaimer statement
Disclaimer statement The release, publication or distribution of this presentation in certain jurisdictions may be restricted by law and therefore persons in such jurisdictions into which this presentation is released, published or distributed should inform themselves about and observe such restrict
Slide 26: Citigroup London Conference
Citigroup London Conference 5-6 March 2007
Slide 27: Glossary of terms & measures
Glossary of terms & measures Appendix 1a Except where noted, common terms and measures used in this document are based upon the following definitions: Sales revenue Excludes revenues of associates and non trading revenue. Comparable Profit before finance costs, tax and special items. Includes PAT of
Slide 28: Glossary of terms & measures
Glossary of terms & measures Appendix 1b Except where noted, common terms and measures used in this document are based upon the following definitions: Constant Translation of both current period and comparable period results into US dollars at currency the actual monthly exchange rates applicable fo
Slide 29: Glossary of terms & measures
Glossary of terms & measures Appendix 1c Except where noted, common terms and measures used in this document are based upon the following definitions: Unallocated Head office costs which are not allocated back to the divisions. These are corporate costs excluded from the segmental analyses. Associat
Slide 30: Contact details
Contact details John Hobson Head of Investor Relations john.hobson@brambles.com +61 (2) 9256 5216 +61 (0) 407 436 711