Glanbia Plc · EURONEXT:GL9
Glanbia — FY2016 Earnings Presentation
30 slides from Glanbia's earnings presentation, Feb 22, 2017
Slide 1: Glanbia plc 2016 Full Year Results Presentation
Glanbia plc 2016 Full Year Results Presentation 22 February 2017 Siobhan Talbot Mark Garvey Group Managing Director Group Finance Director
Slide 2: Cautionary Statement
glanbia Cautionary Statement 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 econo
Slide 3: Full Year 2016 Performance Summary
Full Year 2016 Performance Summary 87.66c Seventh consecutive year of double Adj. EPS +11.2% (cc*) digit growth in adjusted EPS +10.8% (rc*) €305.1m EBITA +12.5% (cc*) Strong EBITA growth across the Group +12.6% (rc*) 10.7% Continued EBITA margin EBITA margin +90 bps (cc*) progression across the Gro
Slide 4: Group EBITA progression
Group EBITA progression Total group EBITA growth +12.8% (cc*), +12.6% (rc*) GLANBIA GROUP TOTAL €349.8m Commentary €310.7m €162.6m GLANBIA €135.6m PERFORMANCE NUTRITION €111.8m GLANBIA €106.6m NUTRITIONALS JVs & ASSOCIATES €44.7m €39.7m DAIRY IRELAND €30.7m €28.8m FY 2016 FY 2015 * CC denotes consta
Slide 5: Strategic Initiatives
Strategic Initiatives Proposal to sell 60% of Dairy Ireland to Glanbia Coop JV&A’s Proposed JV in Michigan Amazing Grass and Body & Fit GPN acquisitions 2016 Full Year Results | Slide 5
Slide 6: Proposal to sell 60% of Dairy Ireland to Glanbia Coop
Proposal to sell 60% of Dairy Ireland to Glanbia Coop Key proposals Strategic rationale and timing Non binding memorandum of understanding signed Creates integrated Irish based business of scale – largest Irish dairy processor Expected consideration to plc of €112 million for 60% equity interest. Pe
Slide 7: New Development Project - Joint Venture
New Development Project - Joint Venture 50/50 JV in Michigan • Advanced discussions with three major Michigan Co-ops • Commissioning expected in late 2019 • Development will help Glanbia to maintain leadership position in US Cheese and advanced technology whey • Project cost expected to be $400m to
Slide 8: Acquisitions announced in 2017
Acquisitions announced in 2017 • Plant-based nutrition, Greens & Super Foods • Positions GPN within high growth category • Distribution – natural, online & FDM – North America • Direct to consumer “DTC” online brand • Consumer base is largely in the Netherlands, Belgium and Germany • Providing GPN w
Slide 9: Operational Review
Operational Review 2016 Full Year Results DELIVERING BETTER NUTRITION FOR EVERY STEP OF LIFE’S JOURNEY
Slide 10: Glanbia Performance Nutrition
Glanbia Performance Nutrition Strong performance Performance REVENUE lfl branded in 2016 growth €1,007.5m Branded revenue growth +9.7% (cc) Rev. +2.6% Growth 13.6% branded revenue growth +9.1% (rc) Vol. +6.1% Earnings 20% Increase in EBITA EBITA EBITA margin 130 basis points margin Expansion expansi
Slide 11: Glanbia Nutritionals
Glanbia Nutritionals REVENUE Performance Good Performance in 2016 €1,224.2m +0.4% (cc) 4.5% EBITA growth with +0.5% (rc) Growth strong H2 EBITA Value Continued growth in value- €111.8m added Nutritional Solutions +4.5% (cc) +4.9% (rc) EBITA 30 basis points margin margin Expansion expansion 9.1% Proj
Slide 12: Dairy Ireland & JVA's
Dairy Ireland & JVA’s DAIRY IRELAND JOINT VENTURES & ASSOCIATES EBITA EBITA REVENUE EBITA margin REVENUE EBITA margin Good performance driven by value- Strong performance driven by volume added products growth Strengthening of margins as a result EBITA growth across all three strategic of cost impro
Slide 13: Finance Review
DELIVERING BETTER NUTRITION — = 3 FOR‘EVERY STEP.OF LIFE'S JOURNEY: = =
Slide 14: Summary Income Statement
Summary Income Statement Seventh year of double-digit earnings growth 2016 results summary Reported currency Constant currency pre-exceptional €'m 2016 2015 Change Change Revenue (Wholly-owned) 2,847.9 2,774.3 +2.7% +2.8% EBITA (Wholly-owned) 305.1 271.0 +12.6% +12.5% EBITA margin 10.7% 9.8% +90 bps
Slide 15: Segmental Summary
Segmental Summary Strong performance led by Glanbia Performance Nutrition FY 2016 Constant currency change €'m Revenue EBITA Margin Revenue EBITA Margin Glanbia Performance Nutrition 1,007.5 162.6 16.1% +9.7% 20.0% +130 bps Glanbia Nutritionals 1,224.2 111.8 9.1% +0.4% 4.5% +30 bps Dairy Ireland 616
Slide 16: Revenue Growth by Segment
Revenue Growth by Segment Wholly owned Revenue growth +2.7% (+2.8% CC*) Million €2,900 3.2% 0.2% (0.6)% €2,848m €2,850 €2,800 €2,774m (0.1)% €2,750 €2,700 €2,650 €2,600 FY15 FX Glanbia Glanbia Dairy FY16 Performance Nutritionals Ireland Nutrition * Constant Currency (CC) excluding the impact of FX 2
Slide 17: Revenue Growth by Segment - GPN
Revenue Growth by Segment - GPN Glanbia Performance Nutrition Revenue growth +9.1% (+9.7% CC*) Million €1,050 9.5% €1,007m €1,000 5.0% (4.8)% €950 €923m (0.6)% €900 €850 €800 €750 FY15 FX Volume Price Acquisitions FY16 * Constant Currency (CC) excluding the impact of FX 2016 Full Year Results | Slid
Slide 18: Revenue Growth by Segment - GN
Revenue Growth by Segment - GN Glanbia Nutritionals Revenue growth +0.5% (+0.4% CC*) Million €1,400 €1,218m 0.1% 3.2% (2.8)% €1,224m €1,200 Nutritional Nutritional €1,000 Solutions Solutions €475m €488m €800 €600 US Cheese US Cheese €400 €743m €736m €200 €0 FY15 FY15 FX Volume Price FY16 FY16 * Cons
Slide 19: EBITA Progression
EBITA Progression Wholly owned EBITA growth +12.6% (+12.5% CC*) Million €4.8m €1.9m €305.1m €27.1m €300 €280 €271.0m €0.3m €260 €240 €220 €200 FY15 FX Glanbia Glanbia Dairy FY16 Performance Nutritionals Ireland Nutrition * Constant Currency (CC) excluding the impact of FX 2016 Full Year Results | Sl
Slide 20: Exceptional Items Summary
Exceptional Items Summary €'m 2016 2015 1. Organisation redesign costs (11.4) (7.0) 2. Acquisition integration costs (3.1) (2.9) 3. Rationalisation costs (3.0) (7.8) 4. Irish defined benefit pension plans - (5.0) 5. Disposal of Joint Venture - (3.6) Total exceptional charge before tax (17.5) (26.3)
Slide 21: Cash Flow Progression
Cash Flow Progression Free Cash Flow +22% converting 88% of EBITDA to cash Million €32m €(32m) €370 €50m €354m €(53m) €14m €(4m) €320 €305m €311m €270 €256m €220 €170 €153m €120 2016 Depreciation* Working Business 2016 Net Dividends Other 2016 FCF FCF EBITA Capital Sustaining Operating Interest & fr
Slide 22: Investment and Returns
Investment ROCE and Returns Total Capex Strategic Capex 12.9% -100bps Bus. Sustaining Capex €124m €116m €86m €73m €90m €57m €43m €37m €32m 2016 2015 2014 * Inclusive of estimated contingent consideration 2016 Full Year Results | Slide 22
Slide 23: Balance Sheet
Balance Sheet Financing KPI's 2016 2015 Net Debt €438 million €584 million Net Debt / Adjusted EBITDA¹ 1.19 times 1.75 times Adjusted EBIT¹ / Net Finance Cost 11.5 times 10.8 times 1. The definition of adjusted EBITDA and adjusted EBIT are as per our financing agreements and include dividends from J
Slide 24: Proposed sale of 60% interest in Dairy Ireland to Glanbia Coop
Proposed sale of 60% interest in Dairy Ireland to Glanbia Coop Valuation Process and financing Final agreements to be completed and Enterprise Value (EV of 100%)* €340m shareholder approval required by plc and Coop Equity value (100%)** €186m Expected to close by mid 2017 100% of the actual working
Slide 25: Summary & Outlook
Summa & Outlook q DELIVERING BETTER NUTRITION FOR EVERY STEP OF LIFE’S JOURNEY
Slide 26: Summary & Outlook
Summary & Outlook *Pro-forma adjusted EPS of the continuing Group has been calculated assuming the Dairy Ireland transaction was completed at the start of FY 2016. **Continuing Group as used above includes “Glanbia Ireland” as a 40% associate ***The Dairy Ireland transaction is contingent upon agree
Slide 27: Questions & Answers
DELIVERING BETTER NUTRI 1 FOR EVERY STEP OF LIFE’S EY
Slide 28: Appendix
glanbia Appendix ae a a an DELIVERING BETTER NUTRITION FOR EVERY STEP OF LIFE’S JOURNEY —
Slide 29: Appendix – Non IFRS Performance Measures
Appendix – Non IFRS Performance Measures 1. To arrive at the constant currency year–on–year change, the results for the prior year are retranslated using the average exchange rates for the current year and compared to the current year reported numbers. 2. Revenue comprises sales of goods and service
Slide 30: Delivering better nutrition for every step of life's journey
Delivering better nutrition for every step of life’s journey Liam Hennigan Head of Investor Relations Glanbia plc Glanbia House Kilkenny, Ireland Email: ir@glanbia.ie Tel: +353 56 777 2200