Avery Dennison Corporation · NYSE:AVY
Avery Dennison — FY2019 Earnings Presentation
29 slides from Avery Dennison's earnings presentation, Jan 29, 2020
Slide 1: Fourth Quarter and Full Year 2019 Financial Review and Analysis
Fourth Quarter and Full Year 2019 Financial Review and Analysis 1 January 29, 2020 Supplemental Presentation Materials Unless otherwise indicated, comparisons are to the same periods in the prior year. January 29, 2020 Fourth Quarter and Full Year 2019 Financial Review and Analysis (preliminary, una
Slide 2: Safe Harbor Statement
Safe Harbor Statement Certain statements contained in this document are "forward - looking statements" intended to qualify for the safe harbor from liab ility established by the Private Securities Litigation Reform Act of 1995. These forward - looking statements, and financial or other business targ
Slide 3: Use of Non-GAAP Financial Measures
Use of Non - GAAP Financial Measures This presentation contains certain non - GAAP financial measures as defined by SEC rules. We report our financial results in conf ormity with accounting principles generally accepted in the United States of America, or GAAP, and also communicate with investors us
Slide 4: Delivered another year of strong adjusted earnings growth in 2019
Fourth Quarter and Full Year 2019 Financial Review and Analysis 4 January 29, 2020 Delivered another year of strong adjusted earnings growth in 2019 Reported sales down 1 .2%; organic growth (non - GAAP) of 2.0%, with growth in high value categories more than offsetting a modest decline in the base
Slide 5: Full Year 2019 Segment Overview and Outlook
Fourth Quarter and Full Year 2019 Financial Review and Analysis 5 January 29, 2020 F u ll Year 2019 Segment Overview and 2020 Outlook LGM expanded margin in challenging environment, with solid 2H volume improvement ● Above - average organic growth for high value categories; base business flat, refle
Slide 6: Full Year Segment Sales and Margin Analysis
Fourth Quarter and Full Year 2019 Financial Review and Analysis 6 January 29, 2020 Full Year Segment Sales and Margin Analysis FY19 Reported Organic Sales Change : Label and Graphic Materials (2.2%) 1.2% Retail Branding and Information Solutions 2.3% 5.1% Industrial and Healthcare Materials (3.0%) 0
Slide 7: 2017-2019 Results and 2017-2021 Targets
Fourth Quarter and Full Year 2019 Financial Review and Analysis 7 January 29, 2020 Sales Growth Adjusted EPS Growth Return on Total Capital (ROTC ) 3.9% Organic (3) 5.7 % Ex. Currency (3) 2017 – 2019 RESULTS (1) Reflects five - year compound annual growth rate, with 2016 as the base period (2) Impac
Slide 8: Maintaining disciplined approach to capital allocation
Fourth Quarter and Full Year 2019 Financial Review and Analysis 8 January 29, 2020 Maintaining disciplined approach to capital allocation
Slide 9: Fourth Quarter Overview
Fourth Quarter and Full Year 2019 Financial Review and Analysis 9 January 29, 2020 F ourth Quarter Overview Fourth quarter r eported EPS of $1.92 (comparison to prior year not meaningful primarily due to Q4 - 18 impact of pension plan termination) Adj . EPS of $1.73, up 14% Reported sales of $1.77 b
Slide 10: Sales Trend Analysis
Fourth Quarter and Full Year 2019 Financial Review and Analysis 10 January 29, 2020 Sales Trend Analysis * Totals may not sum due to rounding. 4Q18 1Q19 2Q19 3Q19 4Q19 FY19 Reported Sales Change 1.9% (2.0%) (3.2%) 0.1% 0.2% (1.2%) Organic Sales Change 4.8% 2.4% 1.6% 2.1% 2.1% 2.0% Currency Translati
Slide 11: Fourth Quarter Segment Sales and Margin Analysis
Fourth Quarter and Full Year 2019 Financial Review and Analysis 11 January 29, 2020 Fourth Quarter Segment Sales and Margin Analysis 4Q19 Reported Organic Sales Change : Label and Graphic Materials (0.4%) 1.5% Retail Branding and Information Solutions 3.6% 5.2% Industrial and Healthcare Materials (3
Slide 12: Fourth Quarter Segment Overview: Label and Graphic Materials
Fourth Quarter and Full Year 2019 Financial Review and Analysis 12 January 29, 2020 LABEL AND GRAPHIC MATERIALS ● Reported sales of $ 1.18 bil., down 0.4% ○ On organic basis, sales up 1.5%, driven by volume/mix, partially offset by pricing • Label and Packaging Materials up low - single digits • Com
Slide 13: Fourth Quarter Segment Overview: RBIS and IHM
Fourth Quarter and Full Year 2019 Financial Review and Analysis 13 January 29, 2020 RETAIL BRANDING AND INFORMATION SOLUTIONS ● Reported sales of $427 mil., up 3.6% ○ On organic basis, sales up 5.2 %, driven by continued strength in RFID and external embellishments ● Reported operating margin declin
Slide 14: 2020 EPS Guidance
Fourth Quarter and Full Year 2019 Financial Review and Analysis 14 January 29, 2020 2020 EPS Guidance Add Back : Est. restructuring costs and other items Adjusted EPS (non - GAAP) Reported EPS [$6.75] – [$7.05] [$6.90] – [$7.20] ● Reported sales growth of 4% to 6%, including 0.3% headwind from curre
Slide 15: Appendix: Reconciliation of Financial Measures from GAAP to Non-GAAP
Fourth Quarter and Full Year 2019 Financial Review and Analysis 15 January 29, 2020 Supplemental Presentation Materials Unless otherwise indicated, comparisons are to the same periods in the prior year. January 29, 2020 Appendix: Reconciliation of Financial Measures from GAAP to Non - GAAP
Slide 16: Organic Sales Change – Avery Dennison
Fourth Quarter and Full Year 2019 Financial Review and Analysis 16 January 29, 2020 Organic Sales Change – Avery Dennison (1 ) Totals may not sum due to rounding and other factors .
Slide 17: Organic Sales Change by Segment
Fourth Quarter and Full Year 2019 Financial Review and Analysis 17 January 29, 2020 Organic Sales Change by Segment (1 ) Totals may not sum due to rounding and other factors .
Slide 18: Organic Sales Change by Segment - Continued
Fourth Quarter and Full Year 2019 Financial Review and Analysis 18 January 29, 2020 Organic Sales Change by Segment - Continued (1 ) Totals may not sum due to rounding and other factors .
Slide 19: Adjusted Operating Margin – Avery Dennison
Fourth Quarter and Full Year 2019 Financial Review and Analysis 19 January 29, 2020 Adjusted Operating Margin – Avery Dennison ( 1 ) GAAP adjustments for 2015 reflect the previously disclosed impact of the third quarter of 2015 revision to certain benefit plan balances, which had an immaterial impac
Slide 20: Adjusted Operating Margin – LGM
Fourth Quarter and Full Year 2019 Financial Review and Analysis 20 January 29, 2020 Adjusted Operating Margin – LGM
Slide 21: Adjusted Operating Margin – RBIS
Fourth Quarter and Full Year 2019 Financial Review and Analysis 21 January 29, 2020 Adjusted Operating Margin – RBIS
Slide 22: Adjusted Operating Margin – IHM
Fourth Quarter and Full Year 2019 Financial Review and Analysis 22 January 29, 2020 Adjusted Operating Margin – IHM
Slide 23: Adjusted Net Income
Fourth Quarter and Full Year 2019 Financial Review and Analysis 23 January 29, 2020 Adjusted Net Income (1) GAAP adjustments for 2015 reflect the previously disclosed impact of the third quarter of 2015 revision to certain benefit plan balances, which had an imm aterial impact on the non - GAAP amou
Slide 24: Adjusted EPS
Fourth Quarter and Full Year 2019 Financial Review and Analysis 24 January 29, 2020 Adjusted EPS (1) GAAP adjustments for 2015 reflect the previously disclosed impact of the third quarter of 2015 revision to certain benefit plan balances, which had an imm aterial impact on the non - GAAP amounts. (2
Slide 25: Adjusted EPS change, constant currency basis
Fourth Quarter and Full Year 2019 Financial Review and Analysis 25 January 29, 2020 Adjusted EPS change, constant currency basis
Slide 26: Free Cash Flow
Fourth Quarter and Full Year 2019 Financial Review and Analysis 26 January 29, 2020 Free Cash Flow
Slide 27: Return on Total Capital (ROTC)
Fourth Quarter and Full Year 2019 Financial Review and Analysis 27 January 29, 2020 Return on Total Capital (ROTC) ( 1 ) "Provision for income taxes" for the fourth quarter of 2017 includes the estimated impact of TCJA enacted in the U.S. on Dece mbe r 22, 2017. In the fourth quarter of 2018, we fin
Slide 28: Net Debt to Adjusted EBITDA
Fourth Quarter and Full Year 2019 Financial Review and Analysis 28 January 29, 2020 Net Debt to Adjusted EBITDA
Slide 29: and Analysis oration. All rights reserved.
Fourth Quarter and Full Year 2019 Financial Review and Analysis 29 January 29, 2020 © 2017 Avery Dennison Corporation. All rights reserved.