Glanbia PLC · EURONEXT:GL9
Glanbia — FY2009 Earnings Presentation
30 slides from Glanbia's earnings presentation, Mar 10, 2010
Slide 1: 2009 Results
glanbia a world of and cheese
Slide 2: Cautionary statement
10 March 2010 Slide 2 Cautionary statement This presentation and accompanying announcements contain 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 and accompan
Slide 3: 10 March 2010 headlines
10 March 2010 Slide 3 10 March 2010 •Solid full year results in line with market expectations; and •Discussion regarding potential disposal of Irish Dairy and Agri Businesses
Slide 4: 2009 Results
© glanbia 2009 Results 10 March 2010
Slide 5: 2009 Market commentary
10 March 2010 Slide 5 Section 1 Section 2 Section 3 2009 Market commentary • Unprecedented year with “a perfect storm” across the dairy industry • Global economic recession • Nutritional markets very resilient • Weaker demand for dairy products • Sharp decline in global dairy prices to extremely low
Slide 6: 2009 Operating highlights
10 March 2010 Slide 6 Section 1 Section 2 Section 3 2009 Operating highlights • Resilient performance in a very challenging operating environment • Strong result in Global Nutritionals, particularly Optimum Nutrition • Major cost saving initiatives across the Group; continuing in 2010 in Ireland • S
Slide 7: 2009 Financial highlights
10 March 2010 Slide 7 Section 1 Section 2 Section 3 2009 Financial highlights • Operating margin grew by 10 basis points to 6.1% (2008: 6.0%) • EBITDA margin grew 80 basis points to 8.3% (2008: 7.5%) • Adjusted earnings per share down 14.4% to 30.68c (2008: 35.86c) • Dividend per share up 5% to 6.84
Slide 8: 2009 Results summary
10 March 2010 Slide 8 Section 1 Section 2 Section 3 2009 Results summary 2009 2008 Change Revenue1 (€m) 1,830.3 2,232.2 (18.0%) Operating profit pre exceptional (€m) 111.2 134.1 (17.1%) Operating margin pre exceptional (%) 6.1 6.0 Up 10 bps Net financing costs (€m) (24.0) (21.1) €2.9m Share of resul
Slide 9: Financing
10 March 2010 Slide 9 Section 1 Section 2 Section 3 Financing • Net debt €442.6m (2008: €452.1m) • Net debt to EBITDA 2.9 times (2008: 2.7 times) • Total debt facilities €729.1m; €100m additional secured in 2009 • Free cash flow €52.0 m (2008: €72.4 m) • Strategic capital expenditure €45.8 m (2008:
Slide 10: 2009 Net exceptional items (post tax)
10 March 2010 Slide 10 Section 1 Section 2 Section 3 2009 Net exceptional items (post tax) • Cost reduction programme (€15.1m) o Annualised costs saving of c €10.0m in 2009; o Over 200 redundancies planned in Ireland in 2010 • Pensions credit €79.0m o Strategic review of pension arrangements o Reduc
Slide 11: 2009 Segmental summary including Joint Ventures & Associates
10 March 2010 Slide 11 Section 1 Section 2 Section 3 2009 Segmental summary including Joint Ventures & Associates 2009 2008 Operating Operating profit pre Operating EBITDA pre EBITDA profit pre Operating EBITDA pre EBITDA Revenue exceptional Margin exceptional Margin Revenue exceptional Margin excep
Slide 12: US Cheese & Global Nutritionals
10 March 2010 Slide 12 Section 1 Section 2 Section 3 US Cheese & Global Nutritionals €m €m €m Margin Margin Margin Margin 11.4% 9.9% 13.9% 11.5% • Global Nutritionals strong – organic growth, new products, FY Optimum • More than offset lower US Cheese prices; average block cheddar down 30% • Revenue
Slide 13: Dairy Ireland
10 March 2010 Slide 13 Section 1 Section 2 Section 3 Dairy Ireland €m €m €m Margin Margin Margin 3.7% Margin 5.2% 2.3% 4.4% • Significant FY loss in Dairy Ingredients; market decline moderated in H2 • Consumer Products reasonable results in highly competitive market place • Agribusiness weaker perfo
Slide 14: Joint Ventures & Associates
10 March 2010 Slide 14 Section 1 Section 2 Section 3 Joint Ventures & Associates €m €m €m Margin Margin 5.8% 4.6% • Solid performance by Southwest Cheese, despite extremely low cheese prices • Glanbia Cheese UK marginal decline, mozzarella cheese market related • Nutricima Nigeria returned to profit
Slide 15: Strategy update
Strategy update 10 March 2010
Slide 16: 10 March Stock Exchange announcement
10 March 2010 Slide 16 Section 1 Section 2 Section 3 10 March Stock Exchange announcement • Glanbia Co-operative Society Limited, 54.6% shareholder, has expressed an interest in acquiring Group’s Irish Dairy and Agri Businesses (and related activities) • Would be likely to involve significant reduct
Slide 17: Clear rationale and unique transformation opportunity
10 March 2010 Slide 17 Section 1 Section 2 Section 3 Clear rationale and unique transformation opportunity • Glanbia Co-operative Society Limited o Changes in global dairy markets creates environment for potential transaction now o Offers the prospect of full ownership and control of relevant Irish
Slide 18: Dairy Ireland strategy
10 March 2010 Slide 18 Section 1 Section 2 Section 3 Dairy Ireland strategy • Dairy Ingredients: rationalisation and cost competitiveness underpins sustainable business in changed global dairy markets • Consumer Products: continue to develop product portfolio and ‘right-size’ organisation for new Ir
Slide 19: Sustainable higher margins
10 March 2010 Slide 19 Section 1 Section 2 Section 3 Well established international growth strategy Stronger market growth rates Sustainable higher margins Increasing innovation rate Global Nutritionals US Cheese Natural business alignment
Slide 20: Global Nutritionals
10 March 2010 Slide 20 Section 1 Section 2 Section 3 Established, scale businesses with market leading positions B2C Performance Business to consumer manufacturer and marketer Nutrition of products for performance nutrition and health Global Nutritionals and wellness; including leading US sports bra
Slide 21: Nutritional Trends: structural growth drivers
10 March 2010 Slide 21 Section 1 Section 2 Section 3 Nutritional Trends: structural growth drivers Aging profile of Western economies, higher disposal income and shift in attitudes to prevention rather than cure Defensive and offensive actions by leading food and drink companies, NPD by Normalisatio
Slide 22: Global Nutritionals: strong track record of growth
10 March 2010 Slide 22 Section 1 Section 2 Section 3 WPI expansion SWC Global Nutritionals: strong track record of growth Idaho expansion Lactose Idaho Seltzer expansion Lactose and Midwest US$550 million+ Plant WPC expansion Idaho WPI and WPC80 Mexico expansion Southwest Singapore Sydney (2010) Kor
Slide 23: US Cheese: structural growth drivers
10 March 2010 Slide 23 Section 1 Section 2 Section 3 US Cheese: structural growth drivers Core US market growing due to increased population growth, increasing use of cheese as a core ingredient in both out of home and at home cooking Increased, sustained Ongoing rationalisation of demand for cheese
Slide 24: Growth in US Cheese
10 March 2010 Slide 24 Section 1 Section 2 Section 3 SWC II Growth in US Cheese Total Glanbia cheese >800m lbs US$1 billion Barrel cheese Barrel cheese expansion to expansion to Barrel cheese 330m lbs 250m lbs expansion to 300m lbs Cheese Southwest SouthwestCheese Cheese production Barrel cheese sta
Slide 25: Well established international growth strategy
10 March 2010 Slide 25 Section 1 Section 2 Section 3 Well established international growth strategy Strategic strengths Strategic opportunities Market leading Consolidation positions in growth opportunities in markets fragmented markets Focused scale player Growth markets Science-based Favourable co
Slide 26: Conclusion
10 March 2010 Slide 26 Section 1 Section 2 Section 3 Conclusion • Resilient performance in a very challenging operating environment in 2009 • Strong result in Global Nutritionals, particularly Optimum Nutrition • Whilst outlook remains challenging, there are some positive signs which should underpin
Slide 27: Supplementary Information
Supplementary Information 10 March 2010
Slide 28: 2009 Summary cash flow
10 March 2010 Slide 28 Section 1 Section 2 Section 3 2009 2008 Change 2009 Summary cash flow €m €m €m EBITDA pre exceptional 152.5 167.6 (15.1) Working capital movement (32.9) (1.0) (31.9) Net interest and tax paid (30.7) (49.7) 19.0 Business sustaining capital investment (20.1) (23.6) 3.5 Other (in
Slide 29: 2009 Summary balance sheet
10 March 2010 Slide 29 Section 1 Section 2 Section 3 2009 2008 Change 2009 Summary balance sheet €m €m €m Property, plant and equipment 363.2 361.1 2.1 Investments 88.7 100.6 (11.9) Intangible assets 342.1 359.2 (17.1) Non-current receivables 33.7 12.8 20.9 Deferred tax/capital grants (72.9) (46.4)
Slide 30: glanbia
glanbia Glanbia ple, Glanbia House, Kilkenny, Ireland. Tel +353 56 777 2200 Fax.+35356 777 2222 www.glanbia.com