Seb Sa · EURONEXT:SK
Seb Sa — Groupe SEB — Investor Presentation (May 2020)
64 slides from Seb Sa's investor presentation, May 2020
Slide 1: Groupe SEB Presentation May 2020
GROUPE SEB PRESENTATION May 2020
Slide 2: Disclaimer
Disclaimer NOTE This presentation may contain certain forward-looking statements regarding Groupe SEB’s activity, results and financial situation. These forecasts are based on assumptions which seem reasonable at this stage, but which depend on external factors including trends in commodity prices,
Slide 3: Contents
CONTENTS 1. Groupe SEB in a nutshell 2. ESG: a committed Group 3. Covid-19: general context 4. Q1 sales review 5. Q1 ORFA & debt/liquidity 6. Action plan and outlook 3 May 2020 Groupe SEB Presentation
Slide 4: Groupe SEB in a nutshell
- GROUPE SEB INA NUTSHELL
Slide 5: 2019 Key Figures
2019 Key Figures €7,354m €740m €380m 34,000 Sales, + 5.8% Operating Result LFL Net income employees from Activity €267m 1,345 42 Investments in own industrial sites innovation retail stores 5 May 2020 Groupe SEB Presentation
Slide 6: An extensive and diversified offering
An extensive and diversified offering SMALL ELECTRIC APPLIANCES KITCHEN ELECTRICS COOKWARE - KITCHENWARE HOME AND PERSONAL CARE PROFESSIONAL Coffee machines Hotel Equipment 6 May 2020 Groupe SEB Presentation
Slide 7: Competing on a playfield exceeding €75bn
Competing on a playfield exceeding €75bn Global market sizes and breakdown by geography ~€47bn EMEA ~€24bn Asia EMEA Asia ~€9bn Americas Americas Small Domestic Appliances Cookware / Kitchenware Professional Coffee (SDA) (CW / KW) Machines 7 May 2020 Groupe SEB Presentation
Slide 8: Professional coffee: new opportunities in espresso full-auto and filter coffee machines
Professional coffee: new opportunities in espresso full-auto and filter coffee machines Full autos – around 25% of the global market Filter – < 10% of the global market Global market Fully Automatic U.S market Coffee Machines – "Equipment" Filter Coffee Machines Penetration of Fully Automatic Coffee
Slide 9: Main trends structuring our industry
Main trends structuring our industry Scale effect Improvement of technical capabilities in Asian countries Local approach Production New models Expansion Critical size Pure players (direct / marketplaces) of online Leadership By country and by segment Click & Mortars channel SDA AND CW / KW MARKET N
Slide 10: A consumer in constant transformation
A consumer in constant transformation… Health New Simplification & Wellness uses Commitment Digitization Ease of use, Healthy eating Personalized and A quest for meaning, E-commerce, versatility and and emphasizing multicultural naturalness, and connections and time saved home-made trend experience
Slide 11: Groupe SEB: a long-term value-creation strategy
Groupe SEB: a long-term value-creation strategy Focus Strengthen our on growth competitiveness Optimize our industrial facilities… Strength and complementarity of our brands Optimize purchasing and logistics Product innovation Improve industrial productivity Multi-channel distribution strategy Simpl
Slide 12: Relevance of our balanced model
Relevance of our balanced model 1 GEOGRAPHIES 2 CATEGORIES MULTI 3 BRANDS 4 CHANNELS 12 May 2020 Groupe SEB Presentation
Slide 13: A global and balanced presence...
Balanced sales breakdown A global and balanced presence... 1 Unrivalled global footprint, strong local positions Emerging markets Mature markets 45% ▪ ¾ of sales in countries where we are #1 or #2 55% ▪ Continued product offering expansion in markets Acquisitions as an additional catalyst Long-term
Slide 14: ...and accelerating growth across new economies
...and accelerating growth across new economies 1 Increased critical mass across countries ▪ 20th country in 2019: Sales ~ €60m vs. ~ €35m in 2016 Pool of fast-growing countries ▪ EMEA: Slovakia, Ukraine, Kazakhstan, Egypt… ▪ Asia: Thailand, Malaysia ▪ Americas: Mexico, Colombia, … 14 May 2020 Group
Slide 15: Acquisitions as an additional catalyst
Acquisitions as an additional catalyst 8000 2019 1 2005 2016 2018 7000 1988 2011 6485 7354 6812 2001 6000 1998 1972 4770 5000 2004 2007 4000 1997 1968 2870 2015 3000 2000 Ventes en M€ 1825 2006 Acquisitions 1764 1000 170 7 0 1953 1975 1998 2000 2007 2015 2016 2017 2018 15 May 2020 Groupe SEB Present
Slide 16: M&A strategy: focus on complementarity
M&A strategy: focus on complementarity Product 1 complementarity EMSA - 2016 Swizzz Prozzz - 2017 Wilbur Curtis - 2019 Ethera - 2017 Zahran - 2018 Geographical Business complementarity Krampouz - 2019 complementarity WMF - 2016 750g Int. - 2018 FeeliGreen - 2019 OBH Nordica - 2015 * Acquisitions of
Slide 17: A presence on numerous product categories...
A presence on numerous product 2019 sales by category categories... Professional Kitchen Electrics 2 ~10% Global leader in Cookware, Kitchen Electrics and Linen care Home and ~40% Personal ~20% Care Growing steadily in all Consumer categories ~30% Global leader in Professional Coffee (automatic espr
Slide 18: ...and a capacity to reinvent ourselves constantly
Versatile Vacuum Cleaners ...and a capacity to reinvent ourselves +€100m constantly 2 Garment steamers Sales ≥€100m Mugs x2 x4 Creating new product opportunities by leveraging: ▪ Technological developments and consumer trends ▪ Our innovation capabilities ▪ Targeted external growth acquisitions x2 F
Slide 19: A constant focus on innovation
A constant focus on innovation 2 ~1,500 + de €267m ~500 Passion for Innovation, people Investments patents one of the 5 values (R&D, Marketing, Design) (worldwide) of the Group 2019 figures Seb/Tefal Actifry Supor Tefal Tefal Ingenio Moulinex Rowenta Krups Moulinex Rowenta Tefal Original Steam Pro R
Slide 20: A unique brand portfolio...
A unique brand portfolio... 3 Strong, diversified and complementary brands ▪ Consumer, global and regional ▪ Premium ▪ Professional Organized on platforms ➔ Coordination, dissemination, consistency Responsible and inspiring brands 20 May 2020 Groupe SEB Presentation
Slide 21: ...and strong local roots
...and strong local roots 3 Emblematic local brands appealing to consumers in their day-to-day lives for 3 generations ▪ Heritage and credibility Supported by local brand ambassadors ▪ Chefs, influencers, communities of consumers, etc. Stakeholders in society: ▪ Imusa: “Tinteros Day” in Colombia ▪ S
Slide 22: A multi-channel approach...
Sales by distribution channel A multi-channel approach... Professional Mass retail Others 4 Group Retail Network synergies Specialists ▪ Accessing all consumers Traditional ▪ Adapting to local characteristics E-Commerce Long-term partnerships with retailers ▪ Execution, category management, merchand
Slide 23: ...and an increased proximity with end-consumers
Digital share in media investment ...and an increased proximity with end-consumers ~50% 4 x2 Targeted digital approaches 2016 2019 ▪ E-Commerce Traffic on Group websites ▪ Digital investments ▪ Direct relationship with Consumers (CRM) ▪ Communities & apps +79% 2016 2019 Direct approaches ▪ Group Ret
Slide 24: A worldwide industrial organization
A worldwide industrial organization GERMANY Emsdetten FRANCE St Lô Vernon Diez 2/3 of products Mayenne Selongey Erbach CHINA Geislingen manufactured in- Pluguffan Is/Tille Hayingen Shanghaï Tournus Rumilly Riedlingen Taicang house Pont Evêque Marigny RUSSIA Shaoxing St Jean Hangzhou de Bournay St Pe
Slide 25: ESG: A Committed Group
02 ESG: A COMMITTED GROUP
Slide 26: Structure of shareholding and voting rights at 31/12/2019
Structure of shareholding and voting rights at 31/12/2019 (EGM) Structure of shareholding at 31/12/2019 Distribution of voting rights at 31/12/2019 Treasury shares Individual Individual 0,7% Shareholders VENELLE 5,0% Shareholders VENELLE INVESTISSEMENT 5,6% INVESTISSEMENT & associates * 19,5% & asso
Slide 27: Groupe SEB Executive Committee
Groupe SEB Executive Committee Thierry de La Tour d’Artaise Stanislas de Gramont Chairman and CEO Chief Operating Officer Nathalie Lomon Vincent Tai Executive VP, Asia Senior Executive VP, Finance Cyril Buxtorf Executive VP, EMEA Harry Touret Senior Executive VP, Martin Zouhar Human Resources Execut
Slide 28: Our values
Our values Global vision Respect Leadership for change Passion for Products Pragmatism Loyalty Shared ambition Determination Innovator Know-how Corporate Social Trust Agility Daring High standards Responsibility Transparency ENTREPRENEURIAL PASSION RESPECT GROUP DRIVE FOR INNOVATION PROFESSIONALISM
Slide 29: Sustainable development pillars
Sustainable development pillars Empower our customers to have sustainable livings with our products and services Demonstrate on a daily Make healthy and tasty Help everyone to live better Make our products Contribute to the fight basis homemade food that is in a healthy home, regardless and services
Slide 30: People matter
People matter Human Ethics Philanthropy resources • Code of ethics • Social protection floor : • Fight against exclusion: ✓ Death benefit > 400 projects aiming • Responsible purchasing ✓ Medical plan for “a better life for all” ✓ Parenthood • Audits • Health & safety • Employees commitment: • Charit
Slide 31: Cooking for good
Cooking for good Homemade Healthy Sustainable • Help families in difficulty • Creation of a Healthy and • Meet new consumer to improve the diet of sustainable recipe and dietary trends their children from 0 Charter to 3 years old • Promotes more • 2019: 15.000 families responsible everyday • Goal fo
Slide 32: Better homelife
Better homelife Better indoor quality Good design • Intense Pur Air & Clean & Steam • Improve the ergonomics of all products • Filters up to 99.95% of pollution and permanently destroys • Permanent: one arm formaldehyde • Temporary: arm injury • Clean & Steam range: clean floor without detergents: •
Slide 33: Circulation revolution
Circulation revolution Give more Repair Recycling than one life • 94% of electrical • 1 000 000 pots & pans • Renting programs appliances are mainly collected since 2012 repairable • Recrafting • Eco-Respect range: • 40 000 spare parts in 100% recycled • Products donations references aluminum • 6 20
Slide 34: Climate action
Climate action Eco Eco design Eco logistic manufacturing • Eco design politic : • Prioritizes non-road • Eco innovative projects • Durable & recyclable transport: transport by rail • > 150 best practices and river. • Energy efficiency or use of alternative materials • Renewable energies in France, E
Slide 35: Covid-19: General Context
03 COVID-19: GENERAL CONTEXT
Slide 36: General overview: an unprecedented health and economic crisis
General overview: an unprecedented health and economic crisis ▪ Fast spreading epidemic, including 2 “phases” at this stage ➔ China (Asia) / Rest of world + ▪ Massive lockdown – shutdowns: factories, offices, public spaces, retail, restaurants, hotels… ➔ All areas of global economy heavily impacted
Slide 37: Groupe SEB's top priorities
Groupe SEB’s top priorities Liquidity Business continuation Health & safety preservation and Gradual activity plan and service to c c of employees cost reduction resumption customers Group: 33 Covid-sick people* action plans *at April 27. 37 May 2020 Groupe SEB Presentation
Slide 38: Outbreak and spread of the crisis
Outbreak and spread of the crisis Lockdown Jan 20 1 factory closed Progressive resumption CHINA Most factories closed Restart of business of activity OTHER ASIA Business overall OK except for a few weeks in South Korea and Japan Lockdown starting in Italy, then spreading Slow EMEA Most factories clo
Slide 39: Groupe SEB's industrial sites: situation at end-April
Groupe SEB’s industrial sites: situation at end-April GERMANY FRANCE 7 sites 6/1 CHINA 12 sites 7 sites 1 / 11 RUSSIA St Petersburg VIETNAM CZECH REPUBLIC Domazlice 4 sites Zuchwill SWITZERLAND USA Omegna ITALY Canonsburg Montebello EGYPT Borg El Arab End-Feb Baddi Closed Open INDIA Rionegro 8 34 Ca
Slide 40: Customers' situation
Customers’ situation 2019 sales breakdown by distribution channel Current situation B2B Group Retail 11% Mass retail ◼ E-commerce and mass retail 6% 18% E- ➔ 42 % of sales Traditional & others commerce 25% 24% Specialists 16% ◼ Specialists, trad. stores, B2B… ➔ 58% of sales Based on 2019 Annual Fina
Slide 41: Our Chinese experience
Our Chinese experience SDA + Cookware offtake momentum ▪ Offline: slow improvement • Re-opened stores with shortened opening hours • In-store traffic still low especially for electro-specialists • Shortages in cookware (Wuhan plant longer shutdown) 0 Jan 1-19 Jan 20-Feb 16 Feb 17-28 Feb 29-Mar 13 Ma
Slide 42: Q1 Sales Review
04 Q1 SALES REVIEW
Slide 43: Revenue by business activity
Revenue by business activity Revenue €1,454m -15.6% -16.5% LFL Consumer Professional €1,272m €182m -17.4% -17.3% -0.7% -9.7% LFL LFL 43 May 2020 Groupe SEB Presentation
Slide 44: Analysis of Q1 2020 sales
Analysis of Q1 2020 sales In €m 1,722 -284 1,454 +3 +13 Organic Currency Scope growth effect -16.5% +0.1% +0.8% -15.6% Q1 2019 Q1 2020 44 May 2020 Groupe SEB Presentation
Slide 45: Q1 2020 revenue by region
Q1 2020 revenue by region In €m March Q1 2019 Q1 2020 As reported Q1 LFL LFL EMEA 711 641 - 9,9% - 10,4% - 25,5% Western Europe 519 443 - 14,6% - 14,7% - 33,4% Other countries 192 198 + 2,6% + 1,0% - 3,7% AMERICAS 169 149 - 11,7% - 8,6% - 23,1% North America 103 97 - 5,2% - 7,2% - 22,7% South Americ
Slide 46: Western Europe
Western Europe Reminder Q1 sales / €m 2019 2020 REPORTED LFL LFL 2019 Western Europe 519 443 -14.6% -14.7% +3.0% ▪ Overall business impacted by Covid-19 epidemic spread across Western Europe, yet with various magnitudes. Almost all product categories hit. ▪ France: revenue down ~8% including: • SDA
Slide 47: Other EMEA Countries
Other EMEA Countries Reminder Q1 sales / €m 2019 2020 REPORTED LFL LFL 2019 Other EMEA countries 192 198 +2.6% +1.0% +6.9% ▪ Q1 sales slightly up LFL, with core business (excl. LPs) quite dynamic, at + 7% ▪ Robust growth in Jan-Feb, based on Group’s main growth engines. March activity dropping due t
Slide 48: North America
North America Reminder Q1 sales / €m 2019 2020 REPORTED LFL LFL 2019 North America 103 97 -5.2% -7.2% +3.8% ▪ Q1 reported sales decrease reflecting LFL 7.2% decline due to Covid-19 spread in March and positive FX effects ▪ Mixed performance across the 3 countries ▪ Q1 sales down in the US, LFL • Str
Slide 49: South America
South America Reminder Q1 sales / €m 2019 2020 REPORTED LFL LFL 2019 South America 66 52 -21.9% -10.9% +4.8% ▪ Q1 reported sales drop stemming from depreciation of BRL and COP against € and negative impact of Covid-19 on business in March ▪ Strong hit in Brazil • Mixed activity in Jan-Feb. including
Slide 50: China
China Reminder Q1 sales / €m 2019 2020 REPORTED LFL LFL 2019 China 541 365 -32.6% -32.4% +13.4% ▪ First country hit by Covid-19 mid-January • Drastic confinement and shutdown ➔ Unprecedented downturn in consumption • SDA market more resilient than other industries ▪ Supor Q1 domestic sales down 32%
Slide 51: Other Asian countries
Other Asian countries Reminder Q1 sales / €m 2019 2020 REPORTED LFL LFL 2019 Other Asian countries 118 117 -0.2% -1.5% +2.5% ▪ Reported sales are flat but mixed picture across countries ▪ Japan: stable LFL sales in Q1 • No general shutdown, most stores open, nevertheless with a strong traffic decrea
Slide 52: Professional
Professional Reminder Q1 sales / €m 2019 2020 REPORTED LFL LFL 2019 Professional 183 182 -0.7% -9.7% +24.4% ▪ Q1 sales flat as reported but down 9.7% LFL • FX and scope effect (Wilbur Curtis for 1 month, Krampouz for 3 months) • Positive start to the year (Jan-Feb) ▪ LFL drop in sales, for both Prof
Slide 53: Q1 ORFA, Debt / Liquidity
05 Q1 ORFA DEBT / LIQUIDITY
Slide 54: ORfA and net debt
ORfA and net debt Operating Result from Activity €18m vs €138m in Q1 2019 Net debt €1,840m* at 31/03/2020 €1,997 at 31/12/2019 *incl. IFRS 16 debt and others: €389m 54 May 2020 Groupe SEB Presentation
Slide 55: Business model based on a c. 1/3 fixed costs weight…
Business model based on a c. 1/3 fixed costs weight… Sales ~€7.4bn COGS* ~€4.5bn Purchased RM and goods On an annual basis Direct labor costs Freight costs Other production costs ~70% variable Cost base costs OPEX* ~€2.1bn ~€6.6bn ~30% fixed costs R&D costs Advertising Distribution and administrativ
Slide 56: … as a consequence, a stronger operating leverage in H2
… as a consequence, a stronger operating leverage in H2 Q1 Q4 Q1 19% 31% 23% As a reminder, strong seasonality for Q4 Q2 sales with back-end loaded year Sales ORfA 2019 45% 2019 12% ▪ Consequently for ORfA Q2 Q3 22% Q3 ▪ Q1 not representative of FY 24% 24% performance and Q2 as a low point in the ye
Slide 57: Healthy and well-balanced financing structure
Healthy and well-balanced financing structure Headroom incl. undrawn 586 syndicated loan 538 Cash & equiv. 500 ▪ Diversified sources of ~€1bn financing (Bonds, ~€1bn Schuldschein, ORNAE, NEU MTN, NEU CP…) 274 283 Headroom inc. undrawn ▪ No financial covenants syndicated loan 128 ▪ Significant financ
Slide 58: Action Plan and Outlook
06 ACTION PLAN AND OUTLOOK 58
Slide 59: Counter-measures, including cost-reduction actions…
Counter-measures, including cost-reduction actions… ▪ Payroll flexibility measures: short-time working, paid leave, contract suspensions and reduction of temporary staff, recruitment freeze… ▪ Growth drivers adapted to markets’ current situation ▪ Systematic cuts in non-essential expenses (travel, e
Slide 60: … and giving priority to cash generation
… and giving priority to cash generation ▪ Strict control of cash flow including working capital • Special attention on relationship with fragilized suppliers • Strengthened monitoring of receivables ▪ No social tax deferral nor government guaranteed loan requested ▪ Dividend cut: -1/3 vs dividend p
Slide 61: 2020 Outlook
2020 Outlook 1. Reminder: Q1 and Q2 not representative of full year ORfA, as always said 2. …All the more due to massive hit from Covid-19 in H1 (which is usually a lower activity period) 3. Expected performance for Q2 ➔ Estimated revenue loss (as of April 28): €450 to €500m ➔ ORfA most probably neg
Slide 62: Looking ahead… Groupe SEB
Looking ahead… Groupe SEB: ▪ Is adapting to the short term imperatives ▪ Is getting ready for the resumption of activity ▪ Stays focused on its long term goals ▪ Is confident in its solid and well-balanced business model 62 May 2020 Groupe SEB Presentation
Slide 63: Contacts
Investor/Analyst relations Media Relations Groupe SEB Groupe SEB Financial Communication Corporate Communication Dept and Investor Relations C O N TA C T S Isabelle Posth Cathy Pianon Raphaël Hoffstetter Caroline Philips iposth@groupeseb.com cpianon@groupeseb.com rhoffstetter@groupeseb.com cphilips@
Slide 64: Agenda: 2020 key dates
2020 key dates May 19 | 3:00 p.m. 2020 Annual General Meeting – Closed door AGENDA July 23 | before market opens H1 2020 sales and results October 26 | after market closes Nine-month 2020 sales and financial data 64 May 2020 Groupe SEB Presentation