Slide 1: Half Year Results Presentation
Half Year Results Presentation February 2009 www.amcor.com
Slide 2: Disclaimer
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, Amcor. Forward-looking statements can generally be ident
Slide 3: Half Year Profit Results
Half Year Profit Results Dec 07 Dec 08 ∆% PBITDA ($m) 537.5 535.7 (0.3) PBIT($m) 333.8 316.8 (5.1) PAT($m) 185.0 167.4 (9.5) EPS(c) 21.0 20.1 (4.3) PBIT/AFE(%) 11.8 10.3 Dividend(c) 17.0 17.0 Significant Items ($m) (31.0) (58.9) Profit after tax $167 million Return on average funds employed 10.3% Co
Slide 4: Currency Translation Benefit
Currency Translation Benefit Average Exchange Rates cents USD Euro First half 07/08 86.8 61.5 First half 08/09 80.0 55.5 First half currency benefit $14 million profit after tax Second Half Potential Currency Translation Benefit cents USD Euro Second half 07/08 93.0 60.6 Current spot (13/2/09) 66.0
Slide 5: Key Issues
Cash Flow $m Dec 07 Dec 08 PBITDA 537.5 535.7 Solid first half performance Operating cash flow 92.9 (60.5) under very difficult conditions Dividends (154.8) (145.3) Free cash flow (61.9) (205.8) Strong working capital Divestments 970.5 (1.8) performance given the level of industry destocking Growth
Slide 6: Changing Consumer Behaviour; Supply Chain Impact
Changing Consumer Behaviour Supply chain impact Substantial monthly demand variations Destocking through the supply chain Demand weakening through the half Particularly poor in the November and December period
Slide 7: Input Costs Movement
Input Costs Movement Rising costs in the July to September period Substantial falls in the October to December period These cost reductions take time to be reflected in lower finished goods costs Modest FIFO losses with some contracted customers Benefits from lower input costs in calendar 2009 Busin
Slide 8: Amcor PET Packaging
Amcor PET Packaging US$m Dec 07 Dec 08 10.6% Sales 1,263 1,272 9.9% PBIT 86.2 81.7 AFE 1,624 1,655 PBIT/AFE% 10.6 9.9 Cash Flow 86.7 46.3 Dec Dec 07 08 Solid performance given difficult trading conditions PBIT US$ m Amcor PET Packaging Volumes Million Units Dec 07 Dec 08 % North America 9,243 7,983
Slide 9: Changing Product Mix; Custom Container Growth
Changing Product CSDW Custom Beverage Mix – Value Breakdown DP (Diversified Products) Total Sales: North America Sales Latin America Sales US$1,272 m US$761 m US$469 m 40% 8% 10% 10% 17% 38% 54% 73% 50% 46% of total sales are in the custom and diversified products market Amcor’s Custom Container Gro
Slide 10: Latin America; Consumer Demand
Latin America First Half Volumes Custom Beverage Volumes Billions of Units Millions of Units 4.7 4.8 853 4.3 800 4.2 3.9 677 587 2.8 374 399 03/04 04/05 05/06 06/07 07/08 08/09 03/04 04/05 05/06 06/07 07/08 08/09 Custom containers volumes increased 6.7% in the first half Consumer Demand Key Trends C
Slide 11: Operational Performance; PET Packaging Outlook
Operational Performance Key Priorities Continued strong management of costs Discipline in capital expenditure and working capital management Exceptional Safety performance PET Packaging - Outlook Second half Economic environment creating demand uncertainty Growth in innovative products (PowerFlexTM)
Slide 12: Amcor Australasia
Amcor Australasia 12.9% A$m Dec 07 Dec 08 Sales 1,134 1,120 112.9 8.9% PBIT 112.9 74.3 74.3 AFE 1,746 1,677 PBIT/AFE% 12.9 8.9 Dec Dec Cash flow 45.0 66.7 07 08 All data continuing operations, except cash flow PBIT A$ m Difficult half Beverage can earnings substantially lower Australasian Overhead R
Slide 13: Corrugated; Corrugated Price Increase
Corrugated Stable volumes Lower sales in grocery and industrial Higher sales in fruit, produce, meat and beverage Maintained high service levels Corrugated Price Increase Input cost increases of approximately $80 million over the past three years Price increase of 12% announced for all customers in
Slide 14: Recycled Paper Exports; Flexibles
Recycled Paper Exports Currently export old corrugated cartons and recycled paper Export prices have decreased substantially since September Collection costs tied to long term contracts Negative impact on earnings in the short term Substantial benefit in 2009/10 Significant Significantvolatility vol
Slide 15: Rigids; Amcor Flexibles
Rigids Beverage Cans 35% reduction in RTD can volumes New tax on alcoholic ready-to-drink products Earnings substantially lower Glass Continued excellent performance Plant fully loaded Amcor Flexibles €m Dec 07 Dec 08 13.3% Sales 886 813 11.5% 59.1 PBIT 51.1 59.1 AFE 885 886 51.1 PBIT/AFE% 11.5 13.3
Slide 16: Amcor Flexibles; Food Flexibles
Amcor Flexibles Index of Raw Material Input Costs 120 115 110 105 100 95 90 85 80 Index of Raw Material Input Costs Raw material costs increased in the first quarter and decreased in the second quarter. Food Flexibles Volumes 3% lower Customer destocking Sound plant performance Lower overhead costs
Slide 17: Healthcare Flexibles; Tobacco Packaging
Healthcare Flexibles Improved earnings and returns in the US and Europe Focus on improving product mix Increase sales in high performance products Continued earnings improvement Tobacco Packaging Strong first half Sales up 10.7% Successful start up of plant in the Ukraine Investments in Russia, Ukra
Slide 18: Amcor Sunclipse
Amcor Sunclipse US$m Dec07 Dec 08 30.4% Sales 497 476 PBIT 31.5 19.6 31.5 18.3% AFE 207 214 19.6 PBIT/AFE% 30.4 18.3 Cash Flow 49.8 11.0 Dec Dec 07 08 Significantly lower demand in PBIT US$ m November & December Amcor Sunclipse Sales US$m Dec 07 Dec 08 Distribution 392 378 Man. Products 115 112 Corr
Slide 19: Amcor Asia
Amcor Asia 11.2% SG$ m Dec 07 Dec 08 9.1% Sales 75 80 PBIT 25.0 28.1 AFE 445 620 PBIT/AFE% 11.2 9.1 Cash Flow 9.8 24.9 Dec Dec 07 08 Earnings growth of 12.4% PBIT SG$ m Amcor Asia 11.2% SG$ m Dec 07 Dec 08 9.1% Sales 75 80 PBIT 25.0 28.1 AFE 445 620 PBIT/AFE% 11.2 9.1 Cash Flow 9.8 24.9 Dec Dec 07 0
Slide 20: Financial Highlights
Amcor Asia 11.2% SG$ m Dec 07 Dec 08 9.1% Sales 75 80 PBIT 25.0 28.1 AFE 445 620 PBIT/AFE% 11.2 9.1 Cash Flow 9.8 24.9 Dec Dec 07 08 Earnings growth of 12.4% PBIT SG$ m Financial Highlights Results and significant items Cash flow and working capital Capital structure
Slide 21: Results All Operations – Before Significant Items
Results All Operations – Before Significant Items A$m Dec 07 Dec 08 A$m ∆ Sales 4,739.2 4,835.3 PBITDA 537.5 535.7 (1.8) PBITDA difference from: Discontinued Operations (10.4) Translation Impact 32.0 Continuing Operations (23.4) (1.8) Continuing businesses PBITDA down $23 million on a constant curre
Slide 22: Significant Items; Cash Flow – All Operations
Significant Items – All Operations A$m Dec 07 Dec 08 Flexibles restructuring (58.8) (48.0) Australasia restructuring (4.1) (13.7) PET restructuring - (12.8) Prior year disposed businesses 11.7 6.2 AMVIG equity issue 2.2 (3.6) Other - (4.2) Significant items (49.0) (76.1) Tax effect 18.0 17.2 Net sig
Slide 23: Cash Flow; Working Capital Performance
Cash Flow - All Operations A$m Dec 07 Dec 08 Comment Operating cash flow 92.9 (60.5) Dividends (154.8) (145.3) Share buy-back Free cash flow (61.9) (205.8) Divestments 970.5 (1.8) PET Europe Growth Capex / acquisitions (78.5) (231.8) Growth initiatives Payment for shares bought back (169.7) - Procee
Slide 24: Capital Structure; Debt Profile
Capital Structure A$m Jun 08 Dec 08 +/- Funds employed 5,255 6,640 1,385 Net debt 2,252 3,293 1,041 Equity 3,003 3,347 344 Gearing on balance sheet (%) 42.9 49.6 6.7 PBITDA interest cover (times) 6.0 5.2 (0.8) Debt Profile Debt Maturity Profile 31 December Bank A$m Drawn Undrawn Total Bank US Privat
Slide 25: Funding Announcements; Past Three Years
Funding Announcements Amcor has elected to early renew all term bank facilities due in calendar 2009 NAB A$150 million facility which was due to mature in November 2009 has been rolled out to September 2010, subject to finalisation of documentation US$500 million standby facility due in June 2009 is
Slide 26: Transition to Growth; Well Positioned in Current Environment
Transition to Growth Considering purchasing parts of Alcan Packaging Any acquisition will be consistent with strategy Disciplined regarding value Funding approach to be determined Any acquisition will deliver substantial shareholder value Well Positioned in the Current Environment Relatively defensi
Slide 27: Amcor PET Packaging
Appendix Amcor PET Packaging Sales US$m Dec 07 Dec 08 North America 792 761 Latin America 428 469 Bericap 42 40 BG/India 1 2 Total 1,263 1,272
Slide 28: Amcor Flexibles; Amcor Australasia
Amcor Flexibles Sales €m Dec 07 Dec 08 Food 494 401 Healthcare 238 243 Tobacco Pack 152 168 Eliminations 2 1 Total 886 813 Amcor Australasia Sales A$m Dec 07 Dec 08 Fibre 567 598 Flexibles 225 186 Rigid 342 336 Total 1,134 1,120 * For continuing businesses
Slide 29: Amcor Asia
Amcor Asia Sales Sg $m Dec 07 Dec 08 Tobacco Pack 40 42 Flexibles 34 38 Other 1 - Total 75 80