Wolters Kluwer N.V. · EURONEXT:WKL
Wolters Kluwer — Shareholder Meeting (April 2013)
29 slides from Wolters Kluwer's shareholder meeting presentation, Apr 24, 2013
Slide 1: Annual General Meeting of Shareholders
Annual General Meeting of Shareholders April 24, 2013 | Amsterdam
Slide 2: Annual General Meeting of Shareholders
Annual General Meeting of Shareholders April 24, 2013 | Amsterdam Nancy McKinstry CEO and Chairman of the Executive Board
Slide 3: Forward-looking Statements
Forward-looking Statements This presentation contains forward-looking statements. These statements may be identified by words such as "expect", "should", "could", "shall", and similar expressions. Wolters Kluwer cautions that such forward-looking statements are qualified by certain risks and uncerta
Slide 4: Agenda
Agenda Opening Remarks Strategic Priorities Highlights of 2012 Financial Performance 2013 Outlook and Summary Annual General Meeting of Shareholders 2013 4
Slide 5: Highlights FY2012 Results
Highlights FY2012 Results Organic growth positive despite economic challenges in Europe – North America growth accelerates to 4% – Online, software and services revenue up 4% Ordinary EBITA margin improves to 21.8% Diluted ordinary EPS €1.58, up 1% in CC, in line with guidance Ordinary free
Slide 6: Other Highlights
Other Highlights New CFO: Kevin Entricken nominated as new Executive Board Member Scrip dividend abolished – Dividend to be paid in cash only Maintaining progressive dividend policy; proposing €0.69 per share Successful new 10 year Eurobond offering; Existing perpetual bond to be redeemed in
Slide 7: Annual General Meeting of Shareholders 2013
Annual General Meeting of Shareholders 2013 7
Slide 8: Agenda
Agenda Opening Remarks Strategic Priorities Highlights of 2012 Financial Performance 2013 Outlook and Summary Annual General Meeting of Shareholders 2013 8
Slide 9: Portfolio transformation
Portfolio transformation Wolters Kluwer, now focused on four global markets Acquired mainly digital businesses, 2003 incl. PCI, Provation, 2012 TeamMate, Addison, UpToDate, FRSGlobal, Acquired Non-core FinArch, Acclipse, revenue: Lexicomp, P1S €854 Education million Health 21% Tax & Acc LTB1) 27% He
Slide 10: Portfolio transformation
Portfolio transformation Today, 74% of our revenues come from electronic products and services, and we continue to balance and expand our geographic footprint Revenue by Media Format Revenue by Geography1) 31% 26% 36% 40% 44% 44% 48% 43% 52% 52% 16% 15% 15% 5% 6% 5% 13% 4% 4% 13% 54% 58% 54% 49% 51%
Slide 11: Our Strategy
Our Strategy Our strategy aims to accelerate profitable growth Expand our leading, ■ Accelerate organic growth, high growth expand margin longer term, positions increase ROIC Deliver ■ Increase software, cloud, and solutions and mobile offerings insights ■ Increase proportion from faster growing geo
Slide 12: 1. Expand our leading, high growth positions
1. Expand our leading, high growth positions We will continue to allocate the majority of our investment to leading, high growth positions 2012 organic growth of units indicated % of Division Finance and Audit, Risk & +9% Financial & Compliance 49% Compliance1) Health 38% Clinical Solutions >10% Tax
Slide 13: 2. Deliver solutions and insights
2. Deliver solutions and insights Our investment is focused on solutions that drive productivity We will continue to invest 8-10% of revenue on innovation Near term priorities are in mobile and cloud-based applications, and tailored solutions Close collaboration with customers Increasingly Mob
Slide 14: 3. Drive efficiencies
3. Drive efficiencies We will continue to create global scale and savings in our operations Springboard run-rate savings1,2) reached €217 million in 2012 (2011: €191 million) Near term, cost savings expected to offset wage inflation and restructuring costs (included in ordinary EBITA) Sales Chan
Slide 15: Sustainability
Sustainability Sustainability practices are embedded in the way we work •Require suppliers to comply •Invest in sustainable solutions with sustainability standards for our customers •Measure environmental impact •Help our customers to migrate •Emphasize use of responsible to non-paper solutions pape
Slide 16: Wolters Kluwer as Employer
Wolters Kluwer as Employer Building global top talent to support our growth agenda Enterprise Talent Review – Raise profile of talent at Wolters Kluwer – Succession planning Leadership Forum – Professional development – Foster collaboration and share best practices Global Innovation Award – Re
Slide 17: Agenda
Agenda Opening Remarks Strategic Priorities Highlights of 2012 Financial Performance 2013 Outlook and Summary Annual General Meeting of Shareholders 2013 17
Slide 18: 2012 Performance
2012 Performance FY2012 results in line with guidance Continuing operations 2012 Guidance 2012 Actual Achieved Ordinary EBITA Margin 21.5 – 22.5% 21.8% Ordinary Free Cash Flow1) ≥ €425 million €507 million Return on Invested Capital (after tax)1) ≥ 8% 8.8% Diluted Ordinary EPS1) Low single dig
Slide 19: Revenues by division
Revenues by division Revenue growth supported by strong performance in Health and F&CS (€ million) 2012 2011 ∆ ∆ CC ∆ OG Legal & Regulatory 1,491 1,451 +3% -1% -2% Tax & Accounting 981 931 +5% +1% +1% Health 745 639 +17% +8% +5% Financial & Compliance Services 386 333 +16% +9% +5% Total Revenues 3,6
Slide 20: EBITA by division
EBITA by division Margin improvement driven by Health division (€ million) 2012 2011 ∆ ∆ CC ∆ OG Legal & Regulatory 334 324 +3% -2% -4% Tax & Accounting 262 257 +2% -3% -3% Health 163 126 +30% +19% +17% Financial & Compliance Services 73 64 +15% +9% +2% Corporate (47) (43) +8% +8% +8% Total ordinary
Slide 21: Revenues by type
Revenues by type Electronic & service subscriptions continue to grow organically (€ million) 2012 2011 ∆ ∆ CC ∆ OG Electronic & service subscription 1,886 1,701 +11% +5% +3% Print subscription 445 472 -6% -8% -7% Other non-cyclical 342 301 +14% +7% +4% Recurring revenues 2,673 2,474 +8% +3% +1% CLS
Slide 22: Dividend
Dividend Proposed increase to €0.69 for 2012 to be paid in cash Progressive dividend policy: seventh consecutive year of increase Moving to all cash dividend starting with 2012 dividend - Scrip dividend ended – Most cost effective and tax efficient way for the company to deliver on its anti-dilu
Slide 23: Share buy-backs
Share buy-backs Intend to offset dilution from performance share issuance 2012 share buy-back: €135 million completed in two tranches – Total of 10.1 million ordinary shares repurchased (average price €13.45) 2013 share buy-back of up to €20 million to offset dilution from performance shares Sha
Slide 24: Debt refinancing
Debt refinancing New executed €700 million Eurobond; call perpetual bond Financing Profile Net debt at year end 2012: €2,086 million 700 1) – Net debt/EBITDA 2.4x New 10 year Eurobond (€700 701 747 696 3) million) 225 – Attractive coupon of 2.875% 2) – Oversubscription of principal (4.3x) 330 2.
Slide 25: Agenda
Agenda Opening Remarks Strategic Priorities Highlights of 2012 Financial Performance 2013 Outlook and Summary Annual General Meeting of Shareholders 2013 25
Slide 26: Divisional outlook 2013
Divisional outlook 2013 North America to see organic growth, driven by CLS Legal & Regulatory European markets to remain weak Margin contraction to be offset by other divisions Seasonal revenue pattern similar to 2012 Tax & Accounting Expect growth in tax software Margins broadly stable
Slide 27: Guidance 2013
Guidance 2013 Performance indicators FY2013 Guidance Ordinary EBITA Margin 21.5–22.0% Ordinary free cash flow ≥ €475 million Return on Invested Capital (after tax) ≥ 8% Diluted ordinary EPS Low single-digit growth Benchmark net financing result Approximately €130 million Benchmark tax rate Broadly i
Slide 28: Summary
Summary Highlights FY2012 Results: – Positive organic revenue growth in challenging market conditions, driven by growth in digital products – Improved operating margin and free cash flow – Leverage ratio improved and now better than our target Strategic focus on expanding our leading growth busi
Slide 29: Thank you
Thank you Nancy McKinstry Chief Executive Officer and Chairman