Sig Group Ag · SIX:SIGN
Sig — SIG Combibloc — FY2021 Earnings Presentation
32 slides from Sig's earnings presentation, Mar 1, 2022
Slide 1: SIG Combibloc Full Year Results 2021
SIG COMBIBLOC FULL YEAR RESULTS 2021 1 MARCH 2022 CEO SAMUEL SIGRIST CFO FRANK HERZOG
Slide 2: Disclaimer and Cautionary Statement
DISCLAIMER AND CAUTIONARY STATEMENT The information contained in this presentation is not for use within any country or Neither SIG nor any of its directors, officers, employees, agents, affiliates or advisers These alternative non-IFRS measures are presented as we believe that they and jurisdiction
Slide 3: Overview
- OVERVIEW 2021 =
Slide 4: 2021 Business Highlights
STRONG PLATFORM FOR GROWTH INVESTING 2021 BUSINESS HIGHLIGHTS FOR THE FUTURE GROWTH IN ALL REGIONS INVESTING IN OUR GLOBAL LEADING INNOVATION IN FACE OF ONGOING COVID-19 MANUFACTURING PRESENCE DELIVERING MORE VALUE TO SITUATION NEW PLANT OPERATIONAL IN CUSTOMERS WITH SIG NEO - NEXT ANOTHER YEAR OF R
Slide 5: 2021 Financial Highlights
2021 FINANCIAL STRONG FOUNDATION HIGHLIGHTS FOR GROWTH AND EXPANSION CORE REVENUE CORE ADJUSTED FREE CASH ADJUSTED NET € 2.05 BILLION REVENUE UP LIKE- EBITDA FLOW INCOME € 252 FOR-LIKE(1) +15.0% +6.6% € 571 € 258 AT CONSTANT MILLION MILLION MILLION CURRENCY AT CONSTANT (2020: € 498m) (2020: € 232m)
Slide 6: Europe Summary
EUROPE SUMMARY ▪ Predominantly a litre-pack business benefiting from at- home consumption (liquid dairy and food) ▪ Strong base of comparison in 2020 with consumer stockpiling at onset of COVID-19 ▪ At-home consumption robust in Q4 with renewed home- office working € million Q4 2021 2021(1) ▪ Majori
Slide 7: Middle East and Africa Summary
MIDDLE EAST AND AFRICA SUMMARY ▪ Growth achieved despite ongoing impacts from COVID-19 ▪ Consumption of non-carbonated soft drinks impacted by lockdowns and school closures ▪ Drought in South Africa affected liquid dairy business in H1 ▪ New business wins continued: first food filler placed € millio
Slide 8: APAC Summary
APAC SUMMARY CHINA ▪ Return to more normal market conditions ▪ Current focus on nutritional benefits boosting consumption of fresh and aseptic milk ▪ New plant operational € million Q4 2021 2021 ▪ Serving entire APAC region CORE REVENUE 202 691 ▪ Global production of combismile GROWTH (LFL constant
Slide 9: Americas Summary
AMERICAS SUMMARY ▪ Incremental revenue from new fillers placed in Brazil in 2020 ▪ High at-home consumption of liquid dairy and culinary products in Brazil and Mexico ▪ Portfolio diversification including high protein drinks and plant-based dairy alternatives € million Q4 2021 2021 ▪ Increase in US
Slide 10: SIG Neo – Next Generation Filler
PRODUCT DEVELOPMENT IN 2021 EXCELLENCE - ENGINEERED. SIG NEO – NEXT GENERATION FILLER SOLUTIONS - DELIVERED. IMPROVED OPERATING COST 50% higher output with similar footprint 30% reduction in utility costs IMPROVED QUALITY & SAFETY Increased sterility factor from log 5 to log 6 AUTOMATED CLEANING Wit
Slide 11: Combivita Next Generation Packaging
COMBIVITA CONSUMER CENTRIC NEXT GENERATION PACKAGING PACKAGING INNOVATION Increased differentiation Stand out from the crowd on retail shelves truTwist closure Brand new tethered closure with a wider opening for a smooth pouring performance Slanted top Easy pouring until the last drop Extra side pan
Slide 12: Next Generation Innovation: Low Impact Packaging
PRODUCT DEVELOPMENT IN 2021 LOW IMPACT PACKAGING FOR MORE CATEGORIES NEXT GENERATION INNOVATION Extending our SIGNATURE portfolio (the world’s first aluminium-free aseptic packaging) with SIGNATURE EVO: • For oxygen sensitive products such as juices and plant-based dairy alternatives • Available in
Slide 13: 2021 Sustainability Milestones
2021 SUSTAINABILITY MILESTONES CONTINUED BEST-IN-CLASS PROGRESSION • Scope 1 and 2 emissions: TOTAL SCOPE 1 AND 2 GREENHOUSE GAS EMISSIONS(1) • 45% reduction vs. 2020 120 • 100% renewable electricity since 2021 incl ME JV 100 acquisition • Scope 1, 2 and 3 emissions per litre of food packed - THOUSA
Slide 14: Financials
- FINANCIALS =
Slide 15: Full Year Sales Evolution
FULL YEAR SALES EVOLUTION HIGHEST GROWTH IN GROWTH ACROSS ALL REGIONS APAC AND AMERICAS € million • Core revenue: +6.6%(1) • Total revenue: +13.5% -2 • All regions contributed to growth 15 59 52 • H2 2021 benefited from initial price increases in selected markets -20 -16 16 142 2’047 2’062 • Acquisi
Slide 16: Full Year Adj EBITDA Bridge
FULL YEAR ADJ EBITDA BRIDGE 27.7% ADJ EBITDA MARGIN STRONG INCREASE IN PROFITABILITY (VS. 27.4% IN 2020) € million • Continuing margin improvement by 30bps • Strong revenue as key growth driver 27.7% 27.4% • Minor impact from raw material cost -2 -2 3 -3 34 inflation 47 -4 • Production efficiencies
Slide 17: Fourth Quarter Performance
FOURTH QUARTER STRONG Q4 PERFORMANCE FINISH TO THE YEAR LFL CORE REVENUE GROWTH AT CONSTANT CURRENCY +5.1% Q4 CORE REVENUE BRIDGE -4 € million 6 6 0 -6 6 6 61 589 589 514 508 LIKE-FOR-LIKE CONSTANT CURRENCY GROWTH RATE +3.2% +19.3% +3.2% +6.8% 2020 Non-core Core revenue FX Europe MEA APAC Americas O
Slide 18: Multi-year LPB Contracts Limit Exposure to Cost Inflation
MULTI-YEAR LPB CONTRACTS LIMITED RAW MATERIAL EXPOSURE LIMIT EXPOSURE TO COST INFLATION BALANCED WITH PRICE INCREASES BREAKDOWN OF KEY COST ITEMS (1) AS % OF 2021 REVENUE ▪ Liquid packaging board (“LPB”) purchased through multi-year contracts – high level of price visibility 7% ▪ Majority of alumini
Slide 19: Strong Growth in Filler Capex and Continued Investment in Production Sites
STRONG GROWTH IN FILLER CAPEX WELL MANAGED CAPEX AND CONTINUED INVESTMENT IN SUPPORTING GROWTH PRODUCTION SITES € million 2021 2020 CAPITAL EXPENDITURE PROPERTY, PLANT & EQUIPMENT 93 77 GROSS FILLER CAPEX 153 122 UPFRONT CASH (103) (54) NET FILLER CAPEX 50 68 TOTAL NET CAPEX 143 145 TOTAL NET CAPEX
Slide 20: Working Capital Improvement on LFL Basis
WORKING CAPITAL NET WORKING CAPITAL IMPROVEMENT ON LFL BASIS WELL CONTROLLED € million 2021 2020 proforma for ME JV(2) 2020 INVENTORY 194 197 171 TRADE RECEIVABLES 197 165 102 TRADE PAYABLES (218) (171) (164) NET WORKING CAPITAL 173 191 109 % REPORTED REVENUE 8.4% 9.7% 6.0% OTHER RECEIVABLES / PAYAB
Slide 21: Strong Free Cash Flow, 75% Cash Conversion
STRONG FREE CASH FLOW 400 BPS INCREASE 75% CASH CONVERSION IN CASH CONVERSION € million 2021 2020(1) NET CASH FROM OPERATING ACTIVITIES 531 426 Dividends received from joint ventures - 23 Acquisition of property, plant and equipment and intangible assets (246) (199) Payment of lease liabilities (27)
Slide 22: Continued Leverage Reduction
CONTINUED LEVERAGE REDUCTION STRONG TRACK RECORD DESPITE ACQUISITION OF MEA JV OF DELEVERAGING SINCE IPO € million 2021(1) 2020 CASH 305 355 TERM LOAN 550 550 NOTES ISSUES 1’000 1’000 LEASE LIABILITIES 182 147 NET DEBT 1’428 1’342 NET LEVERAGE RATIO 2.5x 2.7x (1) In the calculation of the net levera
Slide 23: Further Improvement in ROCE
FURTHER IMPROVEMENT IN ROCE ROCE IMPROVEMENT POST-TAX ROCE 31% STRENGTH OF BUSINESS MODEL € million 2021(1) 2020 • ROCE at reference 30.0% tax rate INCOME STATEMENT ITEMS increased 150bps to 31.0% Adjusted EBITDA 579 498 Depreciation of PP&E (172) (160) • Driven by: Dividends received from joint ven
Slide 24: Acquisitions of Evergreen Asia and Scholle IPN
ACQUISITIONS OF EVERGREEN ASIA AND SCHOLLE IPN
Slide 25: Evergreen Asia Adds Unique Growth Opportunity in China
EVERGREEN ASIA ADDS UNIQUE GROWTH OPPORTUNITY IN CHINA KEY INDUSTRY AND OPPORTUNITY TO ADD REVENUE OPPORTUNITY MACRO TRENDS FRESH PACKAGING FROM INCREASING DRIVING CONSISTENT CAPABILITIES TO SIG’S SHARE OF WALLET WITH GROWTH IN CHINA ASEPTIC PLATFORM IN ASIA EXISTING KEY CUSTOMERS ACCESS TO REGIONAL
Slide 26: Scholle IPN Makes SIG Stronger and Broadens Organic Growth Platform
SCHOLLE IPN MAKES SIG STRONGER AND BROADENS ORGANIC GROWTH PLATFORM SIMILARITIES RESILIENT FOOD AND HIGH BARRIERS TO STRONG BUSINESS LEADER IN BEVERAGE END MARKETS ENTRY MODEL SUSTAINABILTY NON-DISCRETIONARY ASEPTIC TECHNOLOGY, TOP 10 AVERAGE STRONG SUSTAINABLE PRODUCTS PROPRIETARY FITMENTS CUSTOMER
Slide 27: Clear Financing Strategy
CLEAR FINANCING STRATEGY RATINGS CONFIRMED ENDORSEMENT FOR COMBINED SIG FULLY COMMITTED FUNDING • Committed bridge facilities in place to fund closing of both transactions - expected to occur in Q2/Q3 2022 Event Timing • Flexibility of up to 18 months to arrange long FY results publication 1 March 2
Slide 28: Guidance and Concluding Remarks
GUIDANCE AND CONCLUDING REMARKS
Slide 29: 2022 Financial Guidance
2022 FINANCIAL GUIDANCE GROWTH DRIVEN BY SIG ASEPTIC CARTON, 6M EVERGREEN ASIA & SCHOLLE IPN VOLUME AND PRICE Headline revenue growth 22–24% (constant currency) (of which ~15% from acquisitions) Adj. EBITDA margin Around 26% Effective tax rate 26–28% Net CAPEX (% revenue) 7-9% Dividend payout ratio
Slide 30: Mid-term Financial Guidance
MID-TERM FINANCIAL GUIDANCE CONTINUED EXPANSION CONTINUED BEST-IN-CLASS FINANCIAL METRICS OF TOP AND BOTTOM LINE Revenue growth GDP growth compounder, with improved (constant currency) 4-6% resilience through the acquisition of Scholle IPN Best-in-class margins with expansion potential, Adj. EBITDA
Slide 31: Conclusion: SIG Performing Strongly and Will Be Enhanced by Acquisitions
CONCLUSION: SIG PERFORMING STRONGLY AND WILL BE ENHANCED BY ACQUISITIONS STRONG BUSINESS INNOVATION BROADENING FUNDAMENTALS LEADERSHIP IN ASEPTIC CATEGORIES RESILIENT END MARKETS TECHNOLOGY ADDING FOODSERVICE/ LONG TERM CUSTOMER NEW SUBSTRATES AND INSTITUTIONAL AND RELATIONSHIPS FORMATS INDUSTRIAL L
Slide 32: Thank You
THANK YOU 1 MARCH 2022