Brambles Limited · ASX:BXB
Brambles — FY2012 Earnings Presentation
39 slides from Brambles's earnings presentation, Aug 16, 2012
Slide 1: Full-Year Results
Full-Year Results 16 August 2012
Slide 2: Agenda
Agenda Business Update & FY12 Highlights Tom Gorman, CEO Results Analysis Greg Hayes, CFO Context & Outlook Tom Gorman, CEO 2
Slide 3: Business Update & FY12 Highlights
Business Update & FY12 Highlights Tom Gorman, CEO
Slide 4: Key messages
Business Update & FY12 Highlights Key messages • FY12 Underlying profit of US$1,010M, in line with guidance – US$1,061M at 30 June 2011 foreign exchange rates – US$972M at 30 June 2012 foreign exchange rates • Growth to continue despite weakness in major economies • Continued investment in Pooling S
Slide 5: FY12 results scorecard
Business Update & FY12 Highlights FY12 results scorecard Underlying profit of US$1,050M-US$1,080M at 30 June 2011 FX Constant currency sales revenue growth in all segments Delivery of sales targets in RPCs, Containers and emerging markets Efficiencies from IFCO integration, global Pallets and
Slide 6: Key financial outcomes
Business Update & FY12 Highlights Key financial outcomes Continuing operations Sales revenue US$5,625M 20% Operating profit US$939M 16% Underlying profit US$1,010M 18% Underlying profit (30 June 2011 FX) US$1,061M In line with guidance Underlying basic EPS 42.1 US¢ 16% Dividends per share unchanged
Slide 7: Continued market-share growth
Business Update & FY12 Highlights Continued market-share growth (US$M) Net new business Net annualised new business Pallets – Americas 79 134 Pallets – EMEA 41 82 Pallets - Asia-Pacific 10 12 Total Pallets 130 228 RPCs 24 42 Containers 6 20 Total Pooling Solutions 160 290 Recall 24 24 Total 184 314
Slide 8: Pallets – Americas: delivering the plan
Business Update & FY12 Highlights Pallets – Americas: delivering the plan • Sales revenue up 23% to US$2,041M (pro forma1 up 7%) • New business including win-backs driving USA and Canada growth • Continued profitable expansion in Latin America • IFCO Pallet Management Services and Paramount Pallet i
Slide 9: Pallets – EMEA: challenging conditions
Business Update & FY12 Highlights Pallets – EMEA: challenging conditions • Sales revenue up 1% to US$1,327M • Western Europe stable amid economic volatility • Continued strong growth in Central & Eastern Europe and Middle East & Africa • Key 2H12 customer wins: Kellogg’s (Scandinavia); Colgate-Palmo
Slide 10: Pallets – Asia-Pacific: robust result
Business Update & FY12 Highlights Pallets – Asia-Pacific: robust result • Sales revenue up 11% to US$376M • Solid performance in Australia & New Zealand • Asian operations continuing to grow strongly • Key 2H12 wins: F&N Foods, SCA Hygiene (South-East Asia); Swire Luohe, Annto Logistics, FM Logistic
Slide 11: RPCs: delivering growth
Business Update & FY12 Highlights RPCs: delivering growth • Sales revenue up 145% to US$760M (pro forma1 up 13%) • Growth with existing retailers, new regions and products • Strong progress with North American expansion • Key 2H12 retailer wins/expansion: Vega (Italy); Waitrose, Asda (UK); Systeme U
Slide 12: Containers: strategy on track
Business Update & FY12 Highlights Containers: strategy on track • Sales revenue up 18% to US$277M (pro forma1 up 4%) • Doubling of sales revenue in new businesses (Aerospace, US IBC/Auto) – Slower than anticipated growth in US automotive • European operations resilient • Challenging year for Austral
Slide 13: Recall: growing revenue and profit
Business Update & FY12 Highlights Recall: growing revenue and profit • Sales revenue up 4% to US$845M • Strong sales growth in DMS on new business and volume increases • Cost efficiencies delivered • Softer paper prices and volumes in SDS business • Underlying profit up 20% to US$174M – US$182M at 3
Slide 14: Results Analysis
Results Analysis Greg Hayes, CFO
Slide 15: Results summary
Results Analysis Results summary Continuing operations Actual FX Constant FX (US$M) FY12 FY11 Change Change Sales revenue 5,625.0 4,672.2 20% 22% Underlying EBITDA 1,561.9 1,337.0 17% 18% Underlying profit 1,009.7 857.2 18% 20% Operating profit 939.2 809.2 16% 18% Profit before tax 787.2 681.7 15% 1
Slide 16: Sales revenue growth – constant currency
Results Analysis Sales revenue growth – constant currency (US$M, constant FX) Pro forma1 1 Pro forma figures assume Brambles had owned businesses acquired since 1 July 2010 for all of this period and the prior corresponding period. 16
Slide 17: Pallets: results summary
Results Analysis Pallets: results summary Actual FX Constant FX Pro forma1 (US$M) FY12 FY11 Change change Americas 2,041.3 1,654.8 25% 7% EMEA 1,326.8 1,318.3 4% 4% Asia-Pacific 375.8 340.0 7% 7% Sales revenue 3,743.9 3,313.1 15% 6% Underlying profit 715.0 654.9 11% 9% Margin 19% 20% (1)pp - Return
Slide 18: Pallets Americas: operating profit reconciliation
Results Analysis Pallets Americas: operating profit reconciliation (US$M, constant FX) Pro forma1 1 Pro forma Underlying profit growth is calculated by including the results of PMS in the prior corresponding period adjusted for the amortisation expense arising from acquired identifiable intangible a
Slide 19: Pallets EMEA: operating profit reconciliation
Results Analysis Pallets EMEA: operating profit reconciliation (US$M, constant FX) 19
Slide 20: Pallets Asia-Pacific: operating profit reconciliation
Results Analysis Pallets Asia-Pacific: operating profit reconciliation (US$M, constant FX) 20
Slide 21: RPCs: results summary
Results Analysis RPCs: results summary Actual FX Constant FX (US$M) FY12 FY11 Pro forma1 change Europe 489.5 169.5 16% North America 138.3 33.2 16% South America 24.1 6.1 22% ANZ & South Africa 107.6 101.2 6% Sales revenue 759.5 310.0 15% Underlying profit 125.5 53.8 19% Margin 17% 17% - Return on c
Slide 22: RPCs: operating profit reconciliation
Results Analysis RPCs: operating profit reconciliation (US$M, constant FX) 82 Pro forma1 1 Pro forma Underlying profit growth is calculated by adjusting prior corresponding period results for amortisation expense arising from acquired identifiable intangible assets. 22
Slide 23: Containers: results summary
Results Analysis Containers: results summary Actual FX Constant FX Pro forma1 (US$M) FY12 FY11 Change change Automotive 154.8 149.1 6% 6% CCC 37.9 38.2 - - IBCs 43.1 33.7 29% 12% Aerospace Solutions 40.8 12.8 211% 3% Sales revenue 276.6 233.8 20% 5% Operating / Underlying profit 32.8 37.9 (11)% Marg
Slide 24: Containers: operating profit reconciliation
Results Analysis Containers: operating profit reconciliation (US$M, constant FX) 24
Slide 25: Recall: results summary
Results Analysis Recall: results summary Actual FX Constant FX (US$M) FY12 FY11 Change Americas 370.7 361.9 4% Europe 218.9 208.5 7% Rest of World 255.4 244.9 1% Sales revenue 845.0 815.3 4% Underlying profit 174.2 145.3 19% Margin 21% 18% 2pp Return on capital invested 16% 14% Significant items (14
Slide 26: Recall: operating profit reconciliation
Results Analysis Recall: operating profit reconciliation (US$M, constant FX) 26
Slide 27: Reconciliation: EBITDA to cash flow
Results Analysis Reconciliation: EBITDA to cash flow (US$M, actual FX) FY12 FY11 Change EBITDA 1,561.9 1,337.0 224.9 Capital expenditure (949.4) (764.7) (184.7) Proceeds from sale of P,P&E 93.5 100.8 (7.3) Working capital movement (107.9) (14.8) (93.1) IPEP expense 100.1 104.9 (4.8) Provisions/other
Slide 28: Capital expenditure trend by segment
Results Analysis Capital expenditure trend by segment (US$M) actual FX, capex on PP&E, accruals basis Pallets and other pooling capex broadly in line with FY12 Note: Growth programs defined as investments in emerging markets, RPCs and Containers, which in FY12 and FY13 consists of the US$550 million
Slide 29: Strong balance sheet
Results Analysis Strong balance sheet (Actual FX) June 12 June 11 Net debt (US$M) 2,690 2,999 Gearing1 (%) 49.5 55.0 (Actual FX) FY12 FY11 Covenants EBITDA/net finance costs (x) 10.3 10.5 3.5 (min) Net debt/EBITDA (x) 1.7 2.2 3.5 (max) Undrawn committed credit facilities: US$1,223M 1 Gearing defined
Slide 30: Context & Outlook
Context & Outlook Tom Gorman, CEO
Slide 31: Pallets outlook: developed operations
Context & Outlook Pallets outlook: developed operations • Continued net new business wins expected in all regions • Focus on delivery of efficiencies – Global operations and logistics savings – IFCO integration synergies – Final Better Everyday efficiencies • Focus on cost-outs and risk management i
Slide 32: Resilience of major Pallets operations
Context & Outlook Resilience of major Pallets operations FY12 sales revenue growth Nominal Pricing/ consumption Market-share Total (Constant currency) organic growth1 CHEP USA 3.1% 2.0% 5.1% 2.3% CHEP Western Europe 2.3% (0.6)% 1.7% 1.3% IFCO Pallet Management Services 4.0% 5.5% 9.5% 2.3% CHEP Austr
Slide 33: Pallets outlook: emerging markets
Context & Outlook Pallets outlook: emerging markets • On track to deliver 15% constant currency sales revenue growth • Margins to improve as scale builds in Asia and CEE • Continued expansion with major customers 1 CHEP Pallets sales revenue excludes IFCO Pallet Management Services, Paramount Pallet
Slide 34: RPCs outlook
Context & Outlook RPCs outlook • On track to deliver 15% constant currency sales revenue growth target in FY13 • Expansion: – Increased penetration with existing retailers – Increased rollout of new products – Increased presence in under-penetrated regions • Medium-to-long-term improvements in profi
Slide 35: Containers outlook
Context & Outlook Containers outlook • Global focus and leadership under new Group President appointed May 2012 • Further doubling of sales revenue in FY13 in new ventures (Aerospace, US IBC and US Auto) – Strong sales momentum in CHEP Aerospace Solutions and US IBCs – US Auto development behind ant
Slide 36: Recall: modest growth, stable margins
Context & Outlook Recall: modest growth, stable margins • Modest constant currency sales revenue growth in FY13 • Stable FY13 Underlying profit margins of ~20% in line with FY12 performance • Business to be managed for ongoing improved return on investment • Capex of approximately US$80M (in line wi
Slide 37: Outlook summary
Context & Outlook Outlook summary • Subject to unforeseen events and ongoing economic uncertainty • Continued constant currency sales revenue growth in all segments • Underlying profit: US$1,010M to US$1,070M – 30 June 2012 foreign exchange rates – Represents growth of 4% to 10% – Includes US$25M in
Slide 38: Brambles Q&A
Brambles Q&A
Slide 39: Brambles
Brambles MOMENTUM -:::."