Glanbia Plc · EURONEXT:GL9
Glanbia — Glanbia Plc Ord — H1 2020 Earnings Presentation
40 slides from Glanbia's earnings presentation, Aug 12, 2020
Slide 1: Glanbia plc Half Year 2020 Results presentation
Glanbia plc Half Year 2020 Results presentation Group Managing Director Group Finance Director
Slide 2: Important notice
2 Glanbia plc | Half Year 2020 presentation Important notice This presentation contains 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. Due to the inherent unc
Slide 3: Covid-19 – Delivering against our priorities
3 Glanbia plc | Half Year 2020 presentation Covid-19 – Delivering against our priorities Protecting Maintaining Maintain financial our people food supply position Managed health and safety Maintained production Net debt: Adjusted EBITDA of employees rigorously across the Group 1.95x throughout the c
Slide 4: Evolving market dynamics
4 Glanbia plc | Half Year 2020 presentation Evolving market dynamics Consumers Customers Our Communities • Increased focus on health and • Acceleration in growth in • Our values came to life with wellness brands and ingredients ecommerce and decline of multiple examples of community specialty channe
Slide 5: Implications for Glanbia in H1 2020
5 Glanbia plc | Half Year 2020 presentation Implications for Glanbia in H1 2020 Trends improving Resilient through Covid-19 10% GPN YoY revenue progression Joint Ventures – 2020 overall staple food -10% Fortified Food Sports & demand good & Beverage Lifestyle Nutrition -30% -50% New JV projects Q1 A
Slide 6: Our strategy is aligned to the new environment
6 Glanbia plc | Half Year 2020 presentation Our strategy is aligned to the new environment Glanbia Glanbia Performance Group Nutrition Nutritionals • Streamline products, prioritise • Grow solutions capability across • Existing ON and SlimFast brands key platforms Maintain prudent capital strategy d
Slide 7: Glanbia structured well to capture opportunities
7 Glanbia plc | Half Year 2020 presentation Glanbia structured well to capture opportunities Trends driving our business have grown more powerful Health and wellness Digital Our Categories of GPN sales now Protein category resilient Brand in Producer of protein online performance nutrition solutions
Slide 8: Glanbia Performance Nutrition HY20 review
Glanbia Performance Nutrition HY20 review
Slide 9: GPN Half Year review
9 Glanbia plc | Half Year 2020 presentation GPN Half Year review EBITA MARGIN €19.6m 3.7% -59.1% cc -390 bps North America Performance Nutrition Revenue progression • Strong underlying branded performance in online and FDMC 1.7% channels offset by weak specialty and distributor channels in Q2 North
Slide 10: GPN transformation focused on revenue and margin growth
10 Glanbia plc | Half Year 2020 presentation GPN transformation focused on revenue and margin growth International Channel focus route-to-market Portfolio streamlined – Supply chain consolidation 35% of SKUs removed underway Demand and ON & SlimFast now 69% of sales NA Contract exit on track Revenue
Slide 11: Significant position in growth channels – online and FDMC
11 Glanbia plc | Half Year 2020 presentation Significant position in growth channels – online and FDMC Revenue by channel Specialty 20% Specialty FDMC 14% 34% FDMC 40% Channel HY 20 Growth* Distributors 12% FDMC +1% Online +11% Distributors (46%) Specialty (41%) Distributors 20% *Reported currency O
Slide 12: GPN has a scale business in North America
12 Glanbia plc | Half Year 2020 presentation GPN has a scale business in North America Revenue by market DTC DTC 6% 7% North America North America Performance Performance Market HY 20 Growth Nutrition Nutrition 38% 37% NA PN* (11%) NA Lifestyle +2% International 21% International (33%) International
Slide 13: North America Performance Nutrition
13 Glanbia plc | Half Year 2020 presentation North America Performance Nutrition • LFL Branded revenue declined by 11.4% in H1 due to challenging Q2 • ON measured consumption -4% in H1 with the trend sequentially improving during Q2 • Headwinds in H1 primarily due to challenges ON net promoter score
Slide 14: North America Lifestyle
14 Glanbia plc | Half Year 2020 presentation North America Lifestyle 98% Brand awareness • Revenue grew 2% in H1 • SlimFast consumption growth of 13.0% in H1 • Majority of this business in FDM channels with a Household penetration growing presence online up 60 bps to 5.0% • Volatility in sales as a
Slide 15: International
15 Glanbia plc | Half Year 2020 presentation International • Revenue declined 33% in H1 • Route-to-market disrupted in many territories: • Lockdowns shut down operations in some countries entirely • Footfall in high street specialty stores down significantly • Gym closures impacted demand • Sales ve
Slide 16: DTC – eCommerce opportunity
16 Glanbia plc | Half Year 2020 presentation DTC – eCommerce opportunity Existing markets New markets entered in 2020 • DTC revenue declined 5% in H1 Sweden • Revenue trajectory improving Russia • H1 declines in key Benelux market as a result of gym UK closures Poland Benelux Germany • Dedicated tea
Slide 17: Glanbia Nutritionals HY20 review
Glanbia Nutritionals HY20 review
Slide 18: Glanbia Nutritionals Half Year review
18 Glanbia plc | Half Year 2020 presentation Glanbia Nutritionals Half Year review REVENUE EBITA MARGIN €1,304.3m €65.4m 5.0% +12.0% cc -0.9% cc -70 bps Resilient performance in H1
Slide 19: Nutritional Solutions Half Year review
19 Glanbia plc | Half Year 2020 presentation Nutritional Solutions Half Year review EBITA MARGIN Non-dairy Ingredients €48.1m 12.4% -130 bps • Strong underlying demand for essential micro nutrients • Some volume headwinds in ‘food-to-go’ category due to - 6.8% cc Covid-19 Revenue progression Dairy I
Slide 20: Nutritional Solutions Strategy
20 Glanbia plc | Half Year 2020 presentation Nutritional Solutions Strategy Providing the building blocks Core for our customers’ brands • Powerful trends driving end market growth in the following categories Solutions • Core solutions are essential micro nutrients and value-added protein ingredient
Slide 21: Foodarom acquisition announcement
21 Glanbia plc | Half Year 2020 presentation Foodarom acquisition announcement Description Strategic rationale Transaction details Glanbia has agreed to acquire Foodarom is scalable and will Expected to complete in H2 ‘Foodarom’, a c.CAD 34m enable the further development of 2020 subject to the cust
Slide 22: US Cheese Half Year review
22 Glanbia plc | Half Year 2020 presentation US Cheese Half Year review EBITA MARGIN €17.3m 1.9% +10 bps +20.1% cc Volumes Revenue progression • Strong volume performance driven by customers with retail end markets Pricing • Pricing volatile in Q2; pass through model 10.3% operated with suppliers 6.
Slide 23: Joint Ventures Half Year review
23 Glanbia plc | Half Year 2020 presentation Joint Ventures Half Year review JV business model • JV business models performed robustly in period of Revenue* Share of PAT** unprecedented volatility €453.6m €31.8m Revenue • Decline driven by negative market pricing in Europe -1.4% cc +17.3% cc Profita
Slide 24: Half Year 2020 Finance review
Half Year 2020 Finance review Mark Garvey Group Finance Director
Slide 25: HY 2020 – Resilient performance in a challenging environment
25 Glanbia plc | Half Year 2020 presentation HY 2020 – Resilient performance in a challenging environment Growth Earnings Cash & Debt Dividends Current trading Wholly-owned Revenue Adjusted EPS down Good operating cash Interim dividend GPN improving after growth of 2.3%, 17.2% constant flow performa
Slide 26: Half Year Group Income Statement
26 Glanbia plc | Half Year 2020 presentation Half Year Group Income Statement HY 2020 results summary Constant Reported currency pre-exceptional €'m currency HY 2020 HY 2019 Change Change • Revenue growth driven by GN Revenue (Wholly-owned) 1,836.7 1,758.4 4.5% 2.3% • EBITA decline driven by GPN EBI
Slide 27: Exceptional Items
27 Glanbia plc | Half Year 2020 presentation Exceptional Items Exceptional Items HY 2020 HY 2019 €‘m €‘m Reorganisation costs 15.2 3.2 Covid-19 costs 3.5 - Legal settlement gain (3.5) - Brexit related costs - 1.1 Exceptional charge before tax 15.2 4.3 Share of results of Joint Venture – Covid-19 cos
Slide 28: Strong Cash Flow enabling investment & returns
28 Glanbia plc | Half Year 2020 presentation Strong Cash Flow enabling investment & returns Total capex €47m €18m €29m 10.68c Operating Cash Flow Dividends from JVs Capital Expenditure Interim Dividend OCF improved by €28 Operated to plan FY20 capex expected Dividend payout million across the Group
Slide 29: Improving Balance Sheet
29 Glanbia plc | Half Year 2020 presentation Improving Balance Sheet Balance Sheet KPIs HY 2020 HY 2019 • Strong Balance Sheet to navigate the Covid-19 pandemic • Net debt decreased by €127m Net Debt €651m €778m on prior half year mainly due to strong cash generation Net Debt / Adj. EBITDA 1.95x 2.1
Slide 30: Conclusion
Conclusion Siobhán Talbot Group Managing Director
Slide 31: Conclusions
31 Glanbia plc | Half Year 2020 presentation Conclusions • Well positioned portfolio to capitalise on consumer trends • Delivering against our priorities during Covid-19 • Trends improving into Q3 following a challenging Q2 • Strong financial position maintained • Strategy on track with focus on GPN
Slide 32: Questions
Questions
Slide 33: Appendix
APPENDIX
Slide 34: Non-IFRS performance measure definitions
34 Glanbia plc | Half Year 2020 presentation Non-IFRS performance measure definitions The Group reports certain performance measures that are not defined under IFRS but which represent additional measures used by the Board of Directors and the Glanbia Operating Executive in assessing performance and
Slide 35: Non-IFRS performance measure definitions
35 Glanbia plc | Half Year 2020 presentation Non-IFRS performance measure definitions 11. The Group considers that items of income or expense which are material by virtue of their scale and nature should be disclosed separately if the Group financial statements are to fairly present the financial pe
Slide 36: Adjusted EPS
36 Glanbia plc | Half Year 2020 presentation Adjusted EPS €’m Reported currency Constant currency Adjusted EPS HY 2020 HY 2019 HY 2019 Profit attributable to equity holders of the Company 55.3 83.3 85.1 Exceptional Items 14.6 3.5 3.6 Profit attributable to equity holders of the Company - pre-excepti
Slide 37: Segmental Analysis
37 Glanbia plc | Half Year 2020 presentation Segmental Analysis €’m Reported currency Constant currency Glanbia Performance Nutrition HY 2020 HY 2019 HY 2019 Growth % Revenue 532.4 620.1 630.6 -15.6% EBITA 19.6 46.9 47.9 -59.1% EBITA margin 3.7% 7.6% 7.6% -390 bps €’m Reported currency Constant curr
Slide 38: Segmental Analysis
38 Glanbia plc | Half Year 2020 presentation Segmental Analysis €'m Reported currency Constant currency Nutritional Solutions HY 2020 HY 2019 HY 2019 Growth % Revenue* 387.9 369.6 376.9 2.9% EBITA 48.1 50.5 51.6 -6.8% EBITA margin 12.4% 13.7% 13.7% -130 bps €'m Reported currency Constant currency US
Slide 39: Segmental Analysis
39 Glanbia plc | Half Year 2020 presentation Segmental Analysis €'m Reported currency Constant currency Revenue HY 2020 HY 2019 HY 2019 Growth % Glanbia Performance Nutrition 532.4 620.1 630.6 -15.6% Nutritional Solutions 387.9 369.6 376.9 2.9% US Cheese 916.4 768.7 788.1 16.3% Glanbia Nutritionals*
Slide 40: Segmental Analysis
40 Glanbia plc | Half Year 2020 presentation Segmental Analysis €'m Reported currency Constant currency EBITA HY 2020 HY 2019 HY 2019 Growth % Glanbia Performance Nutrition 19.6 46.9 47.9 -59.1% Nutritional Solutions 48.1 50.5 51.6 -6.8% US Cheese 17.3 14.0 14.4 20.1% Glanbia Nutritionals 65.4 64.5