Glanbia Plc · EURONEXT:GL9
Glanbia — CAGE Conference 2014
36 slides from Glanbia's conference presentation, Mar 17, 2014
Slide 1: Glanbia CAGE Conference 2014
GLANBIA CAGE CONFERENCE 2014 17 March 2014 www.glanbia.com CAGE 2014 www.glanbia.com 1
Slide 2: Cautionary Statement
CAUTIONARY STATEMENT 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 uncertainties, including both economic and
Slide 3: Glanbia Overview
GLANBIA OVERVIEW LEADING GLOBAL PERFORMANCE NUTRITION AND INGREDIENTS GROUP Market Capitalisation €3.3 billion 2013 Revenue €3.3 billion Employees Countries of Operation Export Markets 5,202 29 130+ CAGE 2014 www.glanbia.com 3
Slide 4: Segmental Overview
SEGMENTAL OVERVIEW TOTAL GROUP REVENUE Branded sports nutrition: • US Cheese GLOBAL • ON GLOBAL • Ingredient PERFORMANCE Technologies • BSN INGREDIENTS NUTRITION • ABB • Customised €3.3bn €655m* • Nutramino €1,075m* Solutions 53% TOTAL GROUP EBITA • Glanbia Ingredients • Consumer JOINT Ireland DAIRY
Slide 5: Our Market Opportunity: Market Backdrop
OUR MARKET OPPORTUNITY MARKET BACKDROP MACRO TRENDS EVOLVING CONSUMER MARKETS GROWTH OF MULTIPLE NUTRITION SEGMENTS GROWING GLOBAL DEMAND FOR FOOD MIDDLE CLASS ADOPTING QUALITY & INCREASING DEMAND FOR HIGHER NUTRIENT WESTERN DIETS TRACEABILITY DENSITY IN MAINSTREAM DIETS ADVANCEMENTS RISING INCREASI
Slide 6: Our Market Opportunity: Our Two Growth Platforms
OUR MARKET OPPORTUNITY OUR TWO GROWTH PLATFORMS B2C GLOBAL B2B PERFORMANCE GLOBAL NUTRITION INGREDIENTS • We will harness increased penetration of sports • We are ideally positioned to address demand nutrition category through brand strength, for higher nutrient density and cleaner labels. breadth o
Slide 7: Global Performance Nutrition
GLOBAL PERFORMANCE NUTRITION CAGE 2014 www.glanbia.com 7
Slide 8: Our Brands
OUR BRANDS CAGE 2014 www.glanbia.com 8
Slide 9: Market Profile
MARKET PROFILE GLOBAL MARKET BY REGION US MARKET BY CHANNEL US MARKET BY FORMAT LAPAC, 10% Other, 18% Caps & Tabs, 6% Specialty, US, 65% 50% RTD, 9% EMEA, 25% Mass, 16% $5.1bn $3.3bn $3.3bn Powder, Internet, 85% 16% GLANBIA FOCUS US largest market but Primary focus on Primary focus on strong and fas
Slide 10: International Expansion
INTERNATIONAL EXPANSION IN-MARKET PRESENCE • 30% + of revenues ex-US 19 # OF COUNTRIES • Proven and repeatable roll-out 12 model 8 • In-market presence in 19 countries currently (from 0 in 2009) 2011 2012 2013 • Strong affinity for US brands CASE STUDY: AUSTRALIA • Global marketing strategy tailored
Slide 11: Deep Connection with Our Consumer
DEEP CONNECTION WITH OUR CONSUMER • Tailor made marketing model NET PROMOTER SCORE • Lead through engagement 85 • Connect on consumer’s terms • Major online and social presence 74 ONLINE PRESENCE Fans Views Followers Unique visitors 1.4m+ 18.4m+ 123k+ 4.1m per annum CAGE 2014 www.glanbia.com 11
Slide 12: Unique Competitive Advantage
UNIQUE COMPETITIVE ADVANTAGE AS A BUSINESS AS A BRAND PORTFOLIO First and fast mover Wide-user base Entrepreneurial culture Key categories Vertically integrated scale Quality and compliance Market leading partnerships Innovative Repeatable business model Trusted, high NPS score
Slide 13: Global Ingredients
GLOBAL INGREDIENTS CAGE 2014 www.glanbia.com 13
Slide 14: Global Ingredients
GLOBAL INGREDIENTS • B2B ingredients • €1.1bn revenue Customised Solutions • Three distinct but related business US units Cheese • Large scale integrated cheese and whey manufacturing • Value-added dairy & non-dairy Ingredient ingredients and premix solutions Technologies CAGE 2014 www.glanbia.com 1
Slide 15: Global Ingredients: US Cheese
GLOBAL INGREDIENTS US CHEESE LARGEST MANUFACTURER OF AMERICAN STYLE CHEDDAR CHEESE BUSINESS MODEL ROLE OF JOINT VENTURES • Large scale efficient operator • US Cheese commercialises all output from • Focus on operational excellence Southwest Cheese JV • Future expansion likely through JV model • Mark
Slide 16: Global Ingredients: Ingredient Technologies
GLOBAL INGREDIENTS INGREDIENT TECHNOLOGIES SCIENCE-LED NUTRITIONAL AND FUNCTIONAL INGREDIENT SOLUTIONS PROVIDER INGREDIENT FOCUS INNOVATION • Dairy-based ingredients • Customer collaboration • Specialty grain ingredients • Proprietary technologies • Aseptic beverages • Market insights HIGH GROWTH EN
Slide 17: Global Ingredients: Customised Solutions
GLOBAL INGREDIENTS CUSTOMISED SOLUTIONS #2 GLOBAL PROVIDER OF CUSTOM-BLENDED PREMIXES BUSINESS MODEL • Blends vitamins & minerals according to exact specifications • Strong global footprint with facilities in the US, Germany & China END MARKETS KEY USPs • Range of end markets with differing • Custom
Slide 18: Strategy Overview
STRATEGY OVERVIEW CAGE 2014 www.glanbia.com 18
Slide 19: Our Value Chain
OUR VALUE CHAIN ADDING VALUE TO B2C OUR BRANDS Optimum Nutrition OUR PORTFOLIO CONSUMER BSN BY MOVING UP BRANDS ABB THE VALUE Nutramino CHAIN IS KEY TO OUR B2B OUR PRODUCTS Dairy-based protein systems STRATEGY SOLUTIONS Vitamin & mineral premixes & SYSTEMS Specialty grain systems Aseptic beverages H
Slide 20: Our Strategy
OUR STRATEGY OUR GROWTH PLATFORMS OVERALL GROUP GLOBAL PERFORMANCE NUTRITION 1. Sustain current and drive further B2C • Grow in US specialty and internet channels; market leadership positions • Focus on high-growth markets and continue with rapid within both B2B and B2C global international expansio
Slide 21: Finance Overview
FINANCE OVERVIEW CAGE 2014 www.glanbia.com 21
Slide 22: Investment and Returns
INVESTMENT AND RETURNS €m • €390m investment over last 3 years 200 Significant investment programme.... incl. acquisitions 150 100 • €120m for 2014 reflecting range of 50 attractive opportunities 0 2010 2011 2012 2013 • Disciplined approach to both M&A Bus. Sustaining Strategic Acquisitions and cape
Slide 23: Capex & Acquisition Highlights
CAPEX & ACQUISITION HIGHLIGHTS STRONG TRACK RECORD FOR CAPEX & M&A NEW PRODUCTION PLANT OPTIMUM NUTRITION GLOBAL PERFORMANCE NUTRITION GLOBAL PERFORMANCE NUTRITION Cost: €50 million Cost: $315 million Commissioning: Q2 2014 (Phase 1) Acquisition date: 2008 SPECIALTY GRAIN PROCESSING FACILITY BSN ING
Slide 24: Financial Flexibility
FINANCIAL FLEXIBILITY €m Favourable debt maturity profile • Strong balance sheet 500 €467m 400 €264m • Net debt €374 million at Dec-13 300 Undrawn €238m 200 • 1.7x net debt / adj. EBITDA 100 €39m €203m Drawn 0 • Current committed debt facilities of 2014 2015 2016 2017 2018 2019 2020 2021 €744 millio
Slide 25: Historic Financials Highlights
HISTORIC FINANCIALS HIGHLIGHTS Adjusted earnings per share EBITA margin 2000-2013 CAGR 12.8% +450bps from 2000-2013 60.00 9.0% 50.00 8.0% 40.00 7.0% 30.00 6.0% 20.00 5.0% 10.00 4.0% 0.00 3.0% 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2000 2001 2002 2003 2004 2005 2006 200
Slide 26: 2013 Financial Highlights
2013 FINANCIAL HIGHLIGHTS GOOD TOP AND BOTTOM LINE GROWTH CONSTANT CURRENCY CHANGE CHANGE TOTAL GROUP REVENUE €3.3bn +8.0% +10.5% TOTAL GROUP EBITA €226.7m +5.6% +9.2% TOTAL GROUP EBITA % 6.9% -20bps -10bps ADJUSTED EPS 55.46c +8.0% +11.9% FREE CASH FLOW €87.6m +35.2% ROCE 14.2% +10bps CAGE 2014 www
Slide 27: 2013 Financial Highlights
2013 FINANCIAL HIGHLIGHTS €m TOTAL GROUP REVENUE GROWTH +10.5%* €m TOTAL GROUP EBITA GROWTH +9.2%* 3,400 245 3.0% -2.5% 240 3.7% -2.9% 3,350 0.9% -3.6% 235 3,300 3,283 0.7% 7.5% 3.8% 230 3,250 227 225 3,200 220 3,150 3.0% 215 215 3,100 210 3,050 3,038 205 3,000 200 FY12 Global Global Dairy Ireland J
Slide 28: Performance Outlook
PERFORMANCE OUTLOOK 2014 OUTLOOK LONG TERM FINANCIAL TARGETS • Overall positive outlook for 2014 ORGANIC EARNINGS1 • Underpinned by our two global growth platforms 8% TO 10% • In particular Global Performance RETURN ON CAPITAL EMPLOYED Nutrition • Guiding 8% to 10% growth in adjusted 12% + EPS on a
Slide 29: Q&A
Q&A CAGE 2014 www.glanbia.com 29
Slide 30: Appendix
APPENDIX CAGE 2014 www.glanbia.com 30
Slide 31: Segmental Overview
SEGMENTAL OVERVIEW STRONG PERFORMANCE IN GLOBAL GROWTH PLATFORMS 2013 Constant currency change €m Revenue EBITA Margin Revenue EBITA Margin Global Performance Nutrition 655.3 70.6 10.8% +15.7% +27.9% +100 bps Global Ingredients 1,074.6 102.0 9.5% +11.5% +8.1% -30 bps Dairy Ireland 652.2 15.1 2.3% +3
Slide 32: Summary Income Statement
SUMMARY INCOME STATEMENT 2013 results summary pre exceptional Reported currency Constant currency €m 2013 2012 Change Change Revenue 2,382.1 2,211.8 +7.7% +10.3% EBITA 187.7 176.7 +6.2% +10.0% EBITA margin 7.9% 8.0% -10bps No change - Amortisation of intangibles (21.0) (19.9) - Net finance costs (23
Slide 33: 2013 Summary Cash Flow
2013 SUMMARY CASH FLOW €m 2013 2012 EBITDA 214.6 201.5 Dividends from Joint Ventures & Associates 10.9 13.8 Working capital movement (39.9) (59.1) Net interest and tax paid (55.8) (48.1) Business sustaining capital expenditure (35.7) (30.1) Other outflows (6.5) (13.2) Free cash flow from continuing
Slide 34: 2013 Summary Balance Sheet
2013 SUMMARY BALANCE SHEET €m 2013 2012 Property, plant and equipment 374.0 309.5 Investments 152.9 135.2 Intangible assets 454.5 473.0 Non-current receivables 9.4 16.8 Deferred tax/capital grants (75.8) (73.7) Working capital 225.7 201.3 Retirement benefit obligations (78.0) (98.1) Provisions (44.8
Slide 35: Joint Ventures & Associates Reconciliation
JOINT VENTURES & ASSOCIATES RECONCILIATION Joint Ventures & Associates - Reconciliation of EBITA to share of results €m 2013 2012 EBITA of Joint Ventures & Associates 39.0 37.9 Reversal of pro-forma adjustment for GIIL1 - (14.8) Reported EBITA 39.0 23.1 Amortisation (0.3) - Finance costs (4.2) (5.3)
Slide 36: Glanbia plc contact details
Glanbia plc Glanbia House Ring Road Kilkenny Ireland Email: ir@glanbia.ie Tel: +353 56 777 2200 CAGE 2014 www.glanbia.com 36