Slide 1: Results for the Half Year Ended 31 Dec 2013
For personal use only McPherson’s Limited Results for the Half Year Ended 31 Dec 2013 Paul Maguire – Managing Director Paul Witheridge – Chief Financial Officer 25 February 2014
Slide 2: MCP 1H FY2014 Financial Results
MCP 1H FY2014 Financial Results For personal use only Sales Revenue of $180.6m, 17.9% above last year Comparable sales in line with 1H FY2013, i.e. excluding acquisitions Underlying EBIT of $17.5m, 2.3% below last year Underlying PAT of $10.2m, 1.9% below last year Underlying EPS of 11.2 cents, 21.7
Slide 3: MCP 1H FY2014 Financial Results
MCP 1H FY2014 Financial Results For personal use only Underlying cash flow from operations before interest and tax payments of $8.4m, 3.4% above last year EBIT Interest Cover(1) of 4.9 times and Leverage Ratio(2) of 2.50 for the 12 months to 31 December 2013 Interim dividend of 6 cents per share ful
Slide 4: Non-cash impairment of intangible assets
MCP 1H FY2014 Financial Results Non-cash impairment of intangible assets For personal use only $80.0m pre-tax non-cash impairment of intangible assets Reflects current challenges – AUD/USD devaluation, cost pressure, increased private label and increased support required by major customers Revision
Slide 5: Strategy Update
For personal use only Strategy Update Paul Maguire
Slide 6: What has challenged the business?
What has challenged the business? For personal use only USD product cost increases ex Asia and a decline in the value of the AUD Continued cost inflation locally Increased support required by customers in a subdued retail environment Private label emphasis in various retail chains Delays in the impl
Slide 7: Company transformation...
Company transformation... For personal use only McPherson’s stated strategy is to substantially transform its business through acquisition/divestment, the establishment of new agency relationships and channel expansion; diversifying away from margin constrained channels and increasing participation
Slide 8: Things we have achieved so far...
Things we have achieved so far... For personal use only Substantially streamlined the business post the McPherson’s Printing Group de-merger Successfully integrated six EPS accretive acquisitions delivering scale, synergies & diversification Upgraded systems and processes (IT and Continuous Improvem
Slide 9: Divisional Summary
Divisional Summary % of Total % Revenue Reasons Outlook For personal use only Revenue* Growth** HEALTH New products 33% 3.5%*** Growth & BEAUTY + acquisitions HOME 15% n/a n/a Growth APPLIANCES New products Sales decline HOUSEWARES 24% 7.8% + clearance (but improved activity profitability) Net effec
Slide 10: Health and Beauty
Health and Beauty For personal use only Current Status » Health & Beauty YTD Sales excluding acquisitions in line with prior period » Successful new product launches under trusted brands » Dr LeWinn’s and Revitanail brands acquired Nov 2013, increasing McPherson’s presence in the Pharmacy channel an
Slide 11: Home Appliances
Home Appliances For personal use only Current Status » Home Appliances acquired Apr 2013 and Think Appliances Nov 2013 » Diversification for McPherson’s into electrical, hardware & commercial » Organic sales growth of 16% YTD » Successful new product launches under trusted brands » Price increases i
Slide 12: Housewares
Housewares For personal use only Current Status » Recent product range rationalisation leading to overhead reductions and an increased focus on major owned brands » Profit adversely affected by private label, product cost increases ex Asia and additional support required by customers » Price increas
Slide 13: Household Consumables
Household Consumables For personal use only Current Status » YTD Sales decline of 4% » Profit significantly impacted by: – lower sales – protracted negotiations prior to acceptance of price increases – product cost increases ex-Asia – AUD decline – increased private label in-store – increased ‘suppo
Slide 14: Summary of initiatives being actioned...
Summary of initiatives being actioned... For personal use only Further Housewares product range rationalisation delivering a net increase in profit Roll-out of the newly upgraded IT system internationally to boost productivity and profit Additional overhead reductions in response to the above Implem
Slide 15: Outlook
Outlook For personal use only Challenging trading conditions, with full year underlying EBIT & NPAT approximately in line with prior year and EPS 15% below due to issuance of equity to fund acquisitions Continued strong performances from Health & Beauty and Home Appliance divisions Profit restoratio
Slide 16: Questions / Mission
For personal use only QUESTIONS Mission To be a world class consumer products company through 1st choice products for consumers and by being a 1st choice partner for customers and suppliers 1st choice employer for employees 1st choice investment for shareholders
Slide 17: Appendix: Financial Performance for the Half Year Ended 31 December 2013
For personal use only Appendix McPherson’s Limited - Financial Performance for the Half Year Ended 31 December 2013 Paul Witheridge Chief Financial Officer
Slide 18: Group Financial Summary for H1 2014
Group Financial Summary for H1 2014 Excluding non-recurring items For personal use only December 2012 December 2013 ($A million) ($A million) Sales 153.2 180.6 17.9% Sales increase EBITDA 19.3 19.0 Depreciation & amortisation (1.3) (1.5) EBIT 18.0 17.5 2.3% EBIT decline Interest (3.2) (3.3) Interest
Slide 19: Group Financial Summary for H1 2014 - Statutory
Group Financial Summary for H1 2014 Statutory (including non-recurring items) For personal use only December 2012 December 2013 ($A million) ($A million) NPBT excluding non-recurring items 14.7 14.2 Non-recurring items: - Impairment of intangibles - (80.0) - Restructuring costs - (1.1) - Other non-r
Slide 20: Non-Recurring Items
Non-Recurring Items For personal use only The following non-recurring items are included in statutory profit / (loss) before tax: December 2012 December 2013 ($A million) ($A million) Impairment of intangibles - (80.0) Contingent consideration adjustment 0.6 - Restructuring costs – redundancies and
Slide 21: Overview of Group Balance Sheet
Overview of Group Balance Sheet For personal use only December 2012 December 2013 ($A million) ($A million) Inventories 55.6 72.8 Receivables 71.3 74.7 Payables (36.4) (46.9) Net working capital 90.5 100.6 Property, plant & equipment 7.7 7.3 Intangibles 191.1 113.4 Assets held for sale - 2.1 Provisi
Slide 22: Group Operating Cashflow
Group Operating Cashflow For personal use only December 2012 December 2013 ($A million) ($A million) Cash flows from operations Receipts from customers (inclusive of GST) 154.5 182.1 Payments to suppliers and employees (inclusive of GST) (146.4) (173.6) Net cash inflows from operations before intere
Slide 23: Group Investing Cashflow
Group Investing Cashflow For personal use only December 2012 December 2013 ($A million) ($A million) Cash flows from investing activities Payments for purchase of property, plant and equipment (1.5) (0.8) Payments* for acquisition of business assets (4.6) (23.0) Payments for purchase of intangibles
Slide 24: Group Cashflow
Group Cashflow For personal use only December 2012 December 2013 ($A million) ($A million) Cash flows from financing activities Net proceeds from capital raising - 4.7 Net proceeds from borrowings 10.0 22.1 Dividends paid (net of DRP) (3.8) (4.8) Net cash inflows from financing activities 6.2 22.0 N
Slide 25: FX Hedging (Australia)
FX Hedging (Australia) For personal use only » Comprehensive FX hedging program in place using Options, Forward Exchange Contracts (FECs) and Collars: Options Protect downside with premium cost but allow upside benefit FEC’s Fixed rate with lost forward points Collar Improved downside protection in
Slide 26: Non-IFRS measures and Disclaimer
For personal use only Non-IFRS measures The non-IFRS measures used by the Company are relevant because they are consistent with measures used internally by management to assess the operating performance of the business. The non-IFRS measures have not been subject to audit or review. Disclaimer State