Slide 1: Investor Presentation Half Year Results February 2006
Investor Presentation Half Year Results February 2006 Disclaimer • This presentation contains forward-looking statements that involve subjective judgment and analysis and are subject to significant uncertainties, risks and contingencies, many of which are outside the control of, and are unknown to,
Slide 2: The Way Forward – Strong Market Positions
• Execution priorities announced in August 2005 • Specific action plans developed • Progress announced today • Substantial upside potential over the next few years The Way Forward – Strong Market Positions
Slide 3: The Way Forward – Sell
• As announced in August 2005 • Review ongoing • Potential sale proceeds between $0.5 to $1.0 billion • Further possible restructuring $100 to $150 million The Way Forward – Strong Market Positions - Sell
Slide 4: Asset sales approximately A$400 million
Asset sales approximately A$400 million • Proceeds from sale of White Cap Closures €230million • Proceeds from sale of non-core Asian businesses S$21 million • It is likely there will be more asset sales over the next 12 to 18 months The Way Forward – Strong Market Positions - Close
Slide 5: European Flexibles operations: Fix
• European Flexibles operations: • Propose to close two plants • Both in the processed food segment • Cash costs of €32 million • Improved earnings €10 million by the end of the second year • Non cash write offs an additional €18 million • Review proceeding • More plant closures possible The Way For
Slide 6: Opportunities to substantially improve underperforming businesses
• Opportunities to substantially improve underperforming businesses: • Corrugated in Australia • PET in Mexico • European Flexibles The Way Forward – Strong Market Positions - Grow
Slide 7: Identified growth markets
• Identified growth markets • Flexibles and Tobacco packaging in emerging markets • Custom PET • Select market segments in Australasia • Announcements • Flexibles expansion in Eastern Europe with additional presses in both Russia and Poland • Tobacco packaging expansion in Poland with an additional
Slide 8: Identified growth markets
• Identified growth markets • Flexibles and Tobacco packaging in emerging markets • Custom PET • Select market segments in Australasia • Announcements • Flexibles expansion in Eastern Europe with additional presses in both Russia and Poland • Tobacco packaging expansion in Poland with an additional
Slide 9: Summary
Summary • Substantial progress over the past six months • Review ongoing and on schedule The Way Forward – Customer & Market Focused
Slide 10: New Structure
New Structure
Slide 11: New Structure
New Structure
Slide 12: Progress in all areas
• Progress in all areas • The program is ongoing Improve shareholder value
Slide 13: Progress in all areas
• Progress in all areas • Next stage is obtaining the benefits • The program is ongoing Improve shareholder value
Slide 14: Sales and PBIT – Fibre division
Sales $M 1,315 1,321 PBIT $M 175.2 153.8 A.F.E. $M 1,743 1,864 PBIT/AFE % 20.1 16.5 Employee’s 6,562 6,525 • Earnings $153.8 million • Returns on Average Funds Invested continue to be good at 16.5% • Difficult half on half comparison given stronger economic conditions in 04/05 • Poor result in overa
Slide 15: PET division results and regional volumes
Sales US$m 1,253 1,520 PBIT US$m 80.8 97.7 A.F.E. US$m 1,785 1,931 PBIT/AFE % 9.1 10.1 Employees 6,122 6,118 • Overall volume growth 8.8% • Custom volume growth 32% • Returns improved from 9.1% to 10.1% Regional Volumes
Slide 16: Flexibles division results
Sales €m 1,021 PBIT €m 63.2 59.3 AFE €m 1,150 1,168 PBIT/AFE% 11.0 10.2 Employees 9,997 9,854 • Flexible sales up 3% • Tobacco Packaging sales up 6% • Returns 10.2% © Amcor Ltd 2005
Slide 17: Raw Material Market Price Trends
Raw Material Market Price Trends
Slide 18: Flexibles and Tobacco Packaging
Flexibles • Processed Food • Good improvement • Fresh Food • Solid performance offset by costs related to overtrading in one market segment • Healthcare • Good performance • One plant loss making and new management addressing the issues • Americas • Very strong half • Strong performance in recoverin
Slide 19: Australasia results
Sales $m PBIT $m 28.9 23.4 A.F.E. $m PBIT/AFE % 23.4 18.3 Employees 2,142 2,148 • Sound half with earnings well up on the second half last year • Returns 18.3% • Distribution achieved improved margins • Pass through of cost increases • Bottom slicing unprofitable customers • Successful pass through
Slide 20: Asia results
Sales $m PBIT $m 19.5 21.3 A.F.E. $m PBIT/AFE % 14.8 16.2 Employees 3,039 2,083 • Sales up 7% and PBIT up 9% • Returns 16.2% • Solid performance in tobacco packaging and flexibles • Increased investment in Vision Grande • Underperforming assets sold • Focus will increasingly be on growth in China •
Slide 21: Cash Flow and Return on Average Funds Employed
*Before significant items Cash Flow 1H Dec 05 $m Inflows Outflows $ Capital Expenditure (net) $ Working Capital PBITDA $ Dividends $637 $ Borrowing Costs $ Tax $ Other & Pension Fund top-up Debt $78 Cash Flow Reconciliation $m Reported PAT after SI and before Minorities 205.1 Depreciation 236.1 Non
Slide 22: Working Capital Performance
• Before significant items • 02/03 and 03/04 AGAAP basis; thereafter AIFRS Working Capital Performance
Slide 23: Flexible Capital Structure
02/03 — 03/04 AGAAP, 04/05 & 1HDec 05 — AIFRS After factoring of receivables Capital Structure $ mill Jun 04 June 05 Dec 05 (AGAAP) (AIFRS) (AIFRS) Equity 3,670 *** 3,380 3,516 Convertible Securities Net Debt 2,357 2,575 2,708 Balance Sheet Capital 6,956 6,853 7,173 OBS items* Total Capital 7,618 7,
Slide 24: PACRS and PRIDES securities
PACRS2 - AUD210m PACRS1-AUD 400m PACRS S = Ss & 2006 => 2005 => PRIDES usp230m PRIDES
Slide 25: AIFRS Impacts and Summary
AIFRS Impacts Profit and loss account • No goodwill amortisation • Tax loss recoupment • Share based payments, pensions, decommissioning etc. • Overall net $50-60m p.a. positive effect vs. AGAAP Financial Summary • Underlying operating PAT steady • Cash flow remains strong • Absorbed higher working