Gascogne · EURONEXT:ALBI
Gascogne — FY2007 Earnings Presentation
36 slides from Gascogne's earnings presentation, Feb 26, 2008
Slide 1: Full-year 2007 results
Full- Full-year 2007 results 26 February 2008 information meeting www.groupe- www.groupe-gascogne.com 1
Slide 2: Highlights
Highlights 2007 e WG Gascogne
Slide 3: 2007 highlights
2007 highlights Mixed operating environment Positive operating conditions in the first half Slowdown in the second half Acceleration in the dollar's decline against the euro Higher raw materials costs 3
Slide 4: Key indicators
Key indicators Economic indicators 2002 2003 2004 2005 2006 2007 Selling prices* 97 94 89 86 89 93 Euro/dollar $1.07 $1.13 $1.25 $1.25 $1.26 $1.38 Brent crude $24.9 $28.9 $38.2 $54.5 $65.1 $72.4 Paper 101 98 91 89 92 96 Plastics* 87 89 106 123 138 143 Energy* 100 105 101 119 163 163 Aluminium* 87 75
Slide 5: 2007 highlights
2007 highlights In- In-depth reorganisation work: faster pace Simplified legal structure Simplified organisation Increasing capital expenditure Ongoing intangible investments 5
Slide 6: 2007 highlights
2007 highlights One more step towards hitting our targets Advances in all indicators: Commercial (higher (higher volumes and prices, improved sales mix) Industrial (further (further improvement in production, productivity and safety) safety) Organisational (further fall in overheads) Higher profits
Slide 7: 2007 highlights
2007 highlights Further points for improvement Two loss- loss-making plants in the Laminates division Operating WCR too high, particularly in the Wood division Profits still below target Scope for improvement in the years to come 7
Slide 8: In figures
2007 in figures e WG Gascogne
Slide 9: 2007 key figures
2007 key figures Consolidated sales +4.8% 632.6 602.4 603.9 Paper Wood €82.5m €110.2m Sacks €118.6m Distribution €143.9m Laminates €177.3m 2005 2006 2007 (m) by business line (€ m) 9
Slide 10: 2007 key figures
2007 key figures Sales by type of industry Sales by geographical zone Heavy industry Africa/Middle Asia 17% Distribution East 3.6% 1.2% 23% Americas 3.3% Central and Eastern Europe 2.0% Western France Processing 60% Europe (ex 58.6% France) 31.3% Sales by end market Distribution Gardening Health and
Slide 11: 2007 key figures
2007 key figures Underlying operating profit Chg. €m 2005 2006 2007 07/06 Sales 602.4 603.9 632.6 4.8% Underlying operating profit 3.0 11.6 12.7 9.5% Adj. underlying operating profit 4.0 7.2 15.4 113.9% Breakdown of Impact in € m Price / Mix change +12.8 Dollar - 2.0 Energy / raw materials -10.6 Vol
Slide 12: 2007 key figures
2007 key figures Adjusted underlying operating profit €m H105 H205 FY05 H106 H206 FY06 H107 H207 FY07 Reported UOP 1.7 1.4 3.1 9.4 2.2 11.6 5.4 7.3 12.7 Non- Non-recurrent expenses1.2 expenses1.2 1.8 3.0 1.1 3.2 4.3 1.9 2.2 4.1 Paper mill stoppage - 3.5 3.5 - - - 3.5 - 3.5 Paper mill stoppage (1.2)
Slide 13: 2007 key figures
2007 key figures Underlying operating profit +10% 15.4 12.7 +114% 11.6 7.2 4.0 3.1 2005 2006 2007 2005 2006 2007 Consolidated underlying Adjusted consolidated operating profit (€ (€ m) underlying operating profit* * excluding non-recurrent (€ m) items and paper mill stoppage 13
Slide 14: 2007 key figures
2007 key figures Net profit €m Chg. 2005 2006 2007 07/06 Underlying operating profit 3.1 11.6 12.7 +10% Other operating income and expenses(29.3) expenses(29.3) 10.0 12.4 +24% activities(9.8) of which – Provisions on business activities(9.8) 7.2 10.5 +46% - Restructuring (6.7) (1.0) 0 -European Comm
Slide 15: 2007 key figures
2007 key figures Financial position Chg. €m 2005 2006* 2007* 07/06 Operating WCR 118.6 137.4 133.3 -3% Capital expenditure 11.8 18.3 19.8 +8% Free cash- cash-flow 26.7 1.2 15.0 x12 Shareholders' equity 162.3 176.0 187.5 +6% Net debt 94.5 120.2 118.2 -2% Gearing (%) 58.2 68.0 63.0 -7% (*) Including I
Slide 16: 2007 key figures
2007 key figures Cost reductions, operating WCR and capital expenditure +10% +8% 42.8 19.8 18.3 39.0 -3% 26.7 137.4 11.8 133.3 118.6 2005 2006 2007 2005 2006 2007 Cost reductions relative to 2002 (€ (€ m) Capital expenditure (€ (€ m) 2005 2006 2007 Operating WCR (€ (€ m) 16
Slide 17: 2007 key figures
2007 key figures Debt, shareholders' equity, gearing, NAV/share -2% +4% 120.2 118.2 +6% €90 €94 -7% 94.5 €83 187.5 68 63 176.0 58 162.3 2005 2006 2007 2005 2006 2007 Debt ((€ € m) NAV per share 2005 2006 2007 2005 2006 2007 Shareholders' equity Gearing (%) (€ m) 17
Slide 18: Divisional highlights in 2007
Divisional highlights in 2007 18
Slide 19: 2007 - Wood division
2007 - Wood division Innovation, innovation and innovation Simplified organisation and strengthened management April plant stoppage scrapped from 2008 onwards Work at the St Symphorien sawmill reorganised into two 8- 8- hour shifts Merger of Imberty companies (Gascogne Imberty) New decorative and ex
Slide 20: 2007 - Wood division
2007 - Wood division Consolidated sales +20% 110.2 Sales +20% 98.4 Forestiè 91.9 Forestière ++ G Wood +7.4% G Imberty +67% (+7.5% at constant scope) 2005 2006 2007 No cannibalisation Sales (€ m) 20
Slide 21: 2007 - Wood division
2007 - Wood division Underlying operating profit Underlying operating profit: "1.2 + 1.8 = 5.1" Adjusted underlying operating profit up from €3.2m to €5.8m +70% Higher sales 5.1 Improvement in the product mix 3.0 3.0 Ongoing cost reductions But Further work on the op. WCR required Underlying operati
Slide 22: 2007 - Paper division
2007 - Paper division Main theme: moving upmarket Reorganisation / increased focus of paper mill functions Wide- Wide-ranging training plan New product launches (PanKraft and Firea) Launch of the 2009 investment plan (€ (€10m) Submission of the biomass project 22
Slide 23: 2007 - Paper division
2007 - Paper division Consolidated sales +0.9% +4.4% Sales +0.9% Sales up 4.4% proforma excluding scheduled 81.8 85.3 stoppage 73.3 Positive competitive environment 82,5 Successive price increases in all product areas 2005 2006 2007 Sales (€ m) Excluding scheduled stoppage 23
Slide 24: 2007 - Paper division
2007 - Paper division -45% 3,1 Underlying operating profit 1.7 Underlying operating profit down from 2005 2006 2007 €3.1m to €1.7m Adjusted underlying operating profit up (€ m) from -€1.5m to €3.0m -5.7 Impact of plant stoppage (€(€3.5m) Work on the product and geographical mix x3 3.0 Further cost r
Slide 25: 2007 - Sacks division
2007 - Sacks division Focus on the client France: Merger of companies ("Gascogne Sack") Merger New plastic sack line and approval by major customers New Supply chain implementation Supply Germany: Commissioning of a 9- Commissioning 9-colour printing machine Greece: Development and diversification D
Slide 26: 2007 - Sacks division
2007 - Sacks division Consolidated sales +4% 113.7 118.6 105.5 Sales +4% Higher volumes and prices Improvement in the product mix Higher sales outside Western Europe 2005 2006 2007 Sales (€ m) 26
Slide 27: 2007 - Sacks division
2007 - Sacks division Underlying operating profit -27% Underlying operating profit stable at €3.8m 6.3 6.0 -12% Adjusted underlying operating profit down from €5.1m to €4.5m 4.5 Three increases in paper prices (€ (€4m) 5.1 4,4 Higher selling prices Adjustment of the customer base in Greece 2005 2006
Slide 28: 2007 - Laminates
2007 - Laminates A year of contrasts Dax: Stronger organisation Stronger Initiatives to increase efficiency Initiatives Givet: Completion of the machinery transfer Completion Industrial development underway Industrial Switzerland: Comprehensive reconfiguration Comprehensive Complete turnaround in re
Slide 29: 2007 - Laminates
2007 - Laminates Consolidated sales +5% 175.2 177.3 168.7 Sales +5% Firm demand Across- Across-the- the-board price rises Initiatives to improve the product mix Delayed industrial development at 2005 2006 2007 Givet Sales (€ m) 29
Slide 30: 2007 - Laminates
2007 - Laminates Underlying operating profit Underlying operating loss cut from €3.8m to €2.6m Adjusted underlying operating loss cut from €3.2m to €2.5m Higher raw materials costs (€ (€4.3m) +32% Dollar impact (€ (€1.4m) Record performance by foreign subsidiaries Gradual development at the Givet si
Slide 31: 2007 - Distribution division
2007 - Distribution division Climax of a major transformation Travelling sales staff: reorganised from 13 regions into 5 reorganised Move from 3 networks to 1 (shared markets) Move Move to strengthen the "Major Accounts" team (from 2 to 11 sales Move staff) Remote selling: Launch of 2 platforms (Bor
Slide 32: 2007 - Distribution division
2007 - Distribution division Consolidated sales -2% 150.1 147.2 143.9 Fall in sales: 2% Industrial sales +0.4% All of the decline attributable to mass retailers Resilient sales at a time of major 2005 2006 2007 transformation Sales (€ m) 32
Slide 33: 2007 - Distribution division
2007 - Distribution division Underlying operating profit Underlying operating profit stable at €3.8m Adjusted underlying operating profit up from €4.1m to €4.3m 3.6 3.8 3.8 Lower sales Increase in non- non-recurrent expenses 2005 2006 2007 Underlying operating profit (€ m) Reorganisation well under
Slide 34: Outlook
2008 Outlook WG Gascogne
Slide 35: Outlook
Outlook Wood division - Maintaining developments - Starting the project to make wooden structural panels for house housess Paper division - Embedding positive momentum - Preparing for investments in 2009 Sacks division - Improving performance - Stepping up product development Laminates - Consolidati
Slide 36: Conclusion
Conclusion Our multi- multi-sector niche strategy, innovation in high- high-value- high-quality value-added products and high- workforce mean that the outlook for Gascogne, our customers, staff and shareholders is bright 36