Ebos Group Limited · NZX:EBO
Ebos — Investor Day (November 2018)
41 slides from Ebos's investor day presentation, Nov 14, 2018
Slide 1: Investor Day
For personal use only INVESTOR DAY 14 November 2018
Slide 2: Disclaimer
DISCLAIMER The information in this presentation was prepared by EBOS Group Ltd with due care and attention. However, the information is supplied For personal use only in summary form and is therefore not necessarily complete, and no representation is made as to the accuracy, completeness or reliabil
Slide 3: Agenda
Introduction and Group Overview John Cullity, EBOS Group CEO For personal use only Healthcare Brett Barons, CEO Symbion Consumer Brands Sean Duggan, CEO Animal Care & Consumer Brands Financial Overview Shaun Hughes, CFO Positioned for Future Growth AGENDA AGENDA John Cullity, EBOS Group CEO Site tou
Slide 4: Introduction and Group Overview
For personal use only Introduction and Group Overview John Cullity, EBOS Group CEO
Slide 5: Group Intent
GROUP INTENT For personal use only EBOS will focus on delivering shareholder value through disciplined investments in a diverse portfolio of health and animal care related activities. Together with our trading partners, we will play an important role in the delivery of health outcomes to the communi
Slide 6: EBOS Group Today
EBOS GROUP TODAY Diversification within Healthcare and Animal Care is a key signature of our approach For personal use only HEALTHCARE ANIMAL CARE COMMUNITY INSTITUTIONAL CONTRACT CONSUMER PRODUCT & VET RETAIL PHARMACY HEALTHCARE LOGISTICS PRODUCTS BRANDS WHOLESALE 6
Slide 7: Executive Leadership Team
EXECUTIVE LEADERSHIP TEAM For personal use only Chief Executive Officer John Cullity CEO Animal Care & Chief Financial Chief Information Group Human Executive General CEO, Symbion General Counsel Consumer Brands Officer Officer Resources Officer Manager, Strategy Brett Barons Janelle Cain Sean Dugga
Slide 8: EBOS Strategic Approach
EBOS STRATEGIC APPROACH For personal use only Our Healthcare and Animal Care strategic focus is centred on Leading Market Disciplined Capital Investing for Growth Positions Management We aim to have positions of Two types of investments: Cash generation to drive scale in the markets we scope for f
Slide 9: Leading Market Positions
LEADING MARKET POSITIONS EBOS Group is the largest and most diversified Australasian marketer, wholesaler and For personal use only distributor of healthcare, medical and pharmaceutical products. It is also a leading marketer and distributor of recognised consumer products and animal care brands. Co
Slide 10: EBOS M&A Approach
EBOS M&A APPROACH For personal use only Our M&A activity aligns with our strategy. We buy value accretive businesses with strong management teams and solid prospects for further growth. We are disciplined in the prices we will pay for businesses and aim to enhance the Group’s ROCE >15%. Boar
Slide 11: Investing for Growth: Recent Transactions
INVESTING FOR GROWTH RECENT TRANSACTIONS For personal use only Acquisition of the minority shares in TerryWhite Group Limited, expected to complete by 31 December 2018.¹ Acquisition of Warner & Webster (31 Aug 2018). A medical & surgical supplies wholesaler with operations in Victoria and South
Slide 12: Healthcare
For personal use only Healthcare Brett Barons, CEO Symbion
Slide 13: Healthcare Management Team
HEALTHCARE MANAGEMENT TEAM For personal use only CEO, Symbion Brett Barons Executive GM, Pharmacy Executive GM, Executive GM, Contract GM Wholesale & Retail and Institutional Operations & Supply CFO, Symbion Logistics Services Healthcare Chain Sharon Papworth Michael Broome Sab Ambroino Stuart Spenc
Slide 14: Healthcare Divisional Summary
HEALTHCARE DIVISIONAL SUMMARY Primary care / Customer Community Pharmacy Hospitals Manufacturer For personal use only Aged care Wholesale Retail Contract Logistics 2 Core Brands & Service Offering Additional valued services 1 ¹ EBOS has a 14.1% shareholding in Medadvisor as at 30 June 2018. ² EBOS h
Slide 15: Chemist Warehouse Tender Win
CHEMIST WAREHOUSE TENDER WIN For personal use only In July 2018, EBOS won the tender to act as the exclusive third party distributor of pharmaceutical products to more than 450 stores in Australia. EBOS expects to enter into a five-year supply agreement, to take effect from 1 July 2019, with the
Slide 16: New Brisbane Warehouse
NEW BRISBANE WAREHOUSE For personal use only High volume pharmaceutical facility – ~10,000m2 World class storage and picking systems Highly efficient pick to person technology 16
Slide 17: Productivity Gains from Investments
PRODUCTIVITY GAINS FROM INVESTMENTS Significant productivity and cost improvements are expected from the new Brisbane warehouse consistent with our investment in automation at Sydney and Melbourne. For personal use only Volume increases from 1 July 2019 will further improve productivity in all wareh
Slide 18: Healthcare Logistics
HEALTHCARE LOGISTICS Logistics solutions to a GMP Pharmaceutical standard to Healthcare companies for For personal use only their warehousing, distribution and related services in Australia and New Zealand. Customers Pharmaceutical manufacturers (including generics & specialty). Medical consumab
Slide 19: Australian Government Policies
AUSTRALIAN GOVERNMENT POLICIES Proactive engagement with the Australian Government on key policies impacting wholesale distribution of medicines For personal use only Community Service Obligation Special Price Access CSO Deed expires December 2018. Government seeking to reduce net funding of hig
Slide 20: Healthcare Strategic Priorities
HEALTHCARE STRATEGIC PRIORITIES For personal use only • Continue to drive efficiencies through cost leadership in a competitive environment. • Bed down Chemist Warehouse. • Grow Healthcare Logistics in Australia. • Increase retail presence through TerryWhite Chemmart, Ventura and other management co
Slide 21: Consumer Brands
For personal use only Consumer Brands Sean Duggan, CEO Animal Care & Consumer Brands
Slide 22: Business Overview
BUSINESS OVERVIEW Business ENDEAVOUR CONSUMER HEALTH ANIMAL CARE For personal use only Key Products & Brands Products & Brands Brands and Service Offering Australia Wholesale Distribution New Zealand Retail 22
Slide 23: Consumer Brands Role Within EBOS
CONSUMER BRANDS ROLE WITHIN EBOS For personal use only Attractive earnings • Higher gross margin & EBIT% Brands play a key role within our markets • Higher growth potential • Strong ROCE We are deeply passionate about helping people Diversified earnings in a less through our brands and helping o
Slide 24: Consumer Brands Leadership Team
CONSUMER BRANDS LEADERSHIP TEAM For personal use only CEO Sean Duggan EGM EGM EGM IS/IT Manager Commercial Director Endeavour Consumer Australasia EBOS Asia Wholesale Health 24
Slide 25: Our Core Competencies
OUR CORE COMPETENCIES For personal use only Leading teams of engaged employees passionate about our brands & categories Belief based Brand building Supply chain & logistics, leveraged off our broader network Vendor management & sourcing Quality control and quality assurance Sales across
Slide 26: Pet Industry – ANZ
PET INDUSTRY – ANZ ANZ pet sector is worth ~$14 billion and is growing at an estimated 2% to 3% per annum¹ For personal use only ANZ Pet Market by segment Market growth driven by trends towards: humanisation of pets; Pet Products premiumisation of pet food and products; and outsourcing of se
Slide 27: Consumer Health & Wellbeing - ANZ
CONSUMER HEALTH & WELLBEING - ANZ The Consumer Health & Wellbeing market across Australia and NZ is significant and highly fragmented across multiple product categories For personal use only Total Consumer Health & Wellbeing markets Australia ¹ New Zealand ² $17.4b $1.28b Grocery Pharmacy Grocery Ph
Slide 28: Black Hawk Growth
BLACK HAWK GROWTH Black Hawk Sales (pre and post acquisition) Australia’s fastest growing premium pet food brand over For personal use only the last four years, now with a leading position in the pet 23% specialty retail channel. 48% Range & brand extension Investment in marketing driving incr
Slide 29: Vitapet – Consistent Growth
VITAPET – CONSISTENT GROWTH Vitapet has an extensive range of pet treats in both Grocery For personal use only and Pet Specialty Vitapet has built very strong market positions in both Vitapet sales growth last 5 Years Australia and New Zealand due to: 5% 7% 7% an extensive and growing product
Slide 30: Red Seal in New Zealand
RED SEAL IN NEW ZEALAND Strong market share in New Zealand supermarkets across key categories ¹ For personal use only Vitamins - Grocery Specialty Teas - Grocery Natural Toothpaste - Grocery Red Seal Red Seal Red Seal ¹ Data based on IRI scanned sales market share data Aug-18. 30
Slide 31: Asia – Consumer Brands Opportunity
ASIA – CONSUMER BRANDS OPPORTUNITY Asia, especially China, wants brands that are trusted and successful in our For personal use only own home markets The important role of brands in our categories are just as relevant in Asia Viewed as an important ‘third leg’ of growth for EBOS Our Asian stra
Slide 32: China's Pet Food Market
CHINA’S PET FOOD MARKET A growing export opportunity For personal use only • China’s Pet Food market is growing at >30% pa. • Households owning a pet in China is ~5% vs Australia & NZ ~60% China Pet Food Market overview & 5 Year Forecast 50,000 45% 50% 44,851 Chinese Dog & Cat Retail Food market 45,
Slide 33: Summary - Consumer Brands
SUMMARY - CONSUMER BRANDS For personal use only Our role within the wider EBOS group is to deliver enduring profitable growth Future opportunities are strong: Build out existing brands & markets Continued Asian expansion Acquire new ‘seed’ brands to take advantage of our existing infrastructur
Slide 34: Financial Overview
For personal use only Financial Overview Shaun Hughes, EBOS Group CFO
Slide 35: Capital Allocation
CAPITAL ALLOCATION Proven record in delivering superior returns from investment in existing businesses whilst leveraging financial strength & cash flow generation to invest in adjacent & new opportunities For personal use only 1 2 Portfolio of strong Trans-tasman businesses Leveraging financial stre
Slide 36: Shareholder Distributions
SHAREHOLDER DISTRBUTIONS Delivering long-term returns to shareholders For personal use only Dividends Per Share (NZ$ cents) • We believe we have the right balance H1 H2 between shareholder distributions and 35.5 retaining sufficient funds for further 32.5 33.0 Cents per share investment. 20.5 25.0 3
Slide 37: Balance Sheet & Debt Management
BALANCE SHEET & DEBT MANAGEMENT Debt Maturity Profile – current facility limits (A$m) Strong balance sheet For personal use only • Average maturity of term debt & securitisation facilities of 3.4 years at 30 June 2018. • Focus on maintaining ROCE above 15.0%. 400 293 161 Net Financial debt of NZ$471
Slide 38: Financial and Capital Considerations
FINANCIAL AND CAPITAL CONSIDERATIONS Focus on maintaining our: For personal use only Industry leading cash conversion cycle (Cash conversion days: 15 at Jun-18). Strong credit disciplines balance sales and credit risk. Disciplined capital allocation approach. Strong balance sheet with capa
Slide 39: Positioned for Future Growth
For personal use only Positioned for Future Growth John Cullity, EBOS Group CEO
Slide 40: Strategic Focus Areas for Growth
STRATEGIC FOCUS AREAS FOR GROWTH For personal use only Continue to execute on both organic growth and strategic value accretive acquisitions. Leverage our position as the lowest cost wholesaler / distributor. Expand our presence in community pharmacy. Build and acquire brands that consumers
Slide 41: Site Tour – New Brisbane Facility
For personal use only Site Tour – New Brisbane Facility OHS Bus departing at 11.15am, returning to the Stamford at 1.00pm.