Societe Bic Sa · EURONEXT:BB
Societe Bic Sa — Investor Day (November 2020)
144 slides from Societe Bic Sa's investor day presentation, Nov 10, 2020
Slide 1: BIC Capital Markets Day Presentations
BIC CAPITAL MARKETS DAY PRESENTATIONS 10 NOVEMBER 2020 1
Slide 2: Disclaimer
DISCLAIMER This document contains certain forward-looking statements concerning SOCIETE BIC. Such forward-looking statements represent trends or objectives and cannot be construed as constituting forecasts regarding the future SOCIETE BIC’s results or any other performance indicator. Forward-looking
Slide 3: Consumer-Centric and Open Innovation
CONSUMER-CENTRIC AND OPEN INNOVATION THOMAS BRETTE Group Insights & Innovation Officer 3
Slide 4: Agenda
AGENDA 01 INNOVATIVE AND CONSUMER-LED 03 OPEN AND EFFICIENT INNOVATION 02 CONSUMER-CENTRIC INNOVATION 4
Slide 5: Innovative and Consumer-Led
Innovative and consumer-led Consumer-centric Innovation Open and Efficient Innovation INNOVATIVE AND CONSUMER-LED Consumer-centric and Open Innovation 5
Slide 6: 6
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Slide 7: Consumer-Centric and Open and Efficient Innovation at BIC
INNOVATION AT BIC CONSUMER-CENTRIC OPEN AND EFFICIENT 7
Slide 8: Consumer-Centric Innovation
Innovative and consumer-led Consumer-centric Innovation Open and Efficient Innovation CONSUMER- CENTRIC INNOVATION Consumer-centric and Open Innovation 8
Slide 9: 9
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Slide 10: The BIC Connected Shaver
CONSUMER-CENTRICITY THE CONNECTED SHAVER The BIC Connected Shaver is a connected device offering us a window to the “moments of truth” - while a consumer is shaving! We can collect implicit and objective data that we have never had before 10
Slide 11: Connected Shaver: Consumer-Centricity Data
CONSUMER-CENTRICITY THE CONNECTED SHAVER Self-assessed answers Implicit data & objective & performance evaluation measurements through the Connected Shaver mobile application through the Connected Shaver sensors • Number of strokes • Number of rinses • Stroke duration • Rinse duration • Hair density
Slide 12: riaRY | JM Saes FARE
| =o & riaRY | JM Saes FARE
Slide 13: The BIC Creative Community
CONSUMER-CENTRICITY THE BIC CREATIVE COMMUNITY An online community launched in June 2020… with 200 interesting and interested BIC consumers… collaborating through regular challenges DAY 01 DAY 02 DAY 04 DAY 05 BRIEFING BRAINSTORM IDEAS AND CHOICE SOLUTIONS 13
Slide 14: The BIC Creative Community
CONSUMER-CENTRICITY THE BIC CREATIVE COMMUNITY 14
Slide 15: Open and Efficient Innovation
Innovative and consumer-led Consumer-centric Innovation Open and Efficient Innovation OPEN AND EFFICIENT INNOVATION Consumer-centric and Open Innovation 15
Slide 16: BIC
(BIC)
Slide 17: Open and Efficient Innovation: Project Leaf
OPEN AND EFFICIENT INNOVATION PROJECT LEAF 17
Slide 18: Plug and Play
PLUGANOPL AY Brand & Retail Q. ax Enterprise Tech a New Materials 'Gig 0,9 W 36 © Sustainability Agtech COVID-19 Animal Health & Energy € Media & Ad a Health Real Estate Fintech Supply Chain Insurtech a Smart Cities Mobility 18
Slide 19: Consumer-Centric and Open Innovation
CONSUMER-CENTRIC AND OPEN INNOVATION 19
Slide 20: A Value-Driven Global Supply Chain
A VALUE-DRIVEN GLOBAL SUPPLY CHAIN PETER DALSBERG Group Supply Chain Officer 20
Slide 21: Agenda
AGENDA 01 DRIVING OUR GLOBAL SUPPLY CHAIN STRATEGY 03 RESPONDING FAST TO A CHANGING WORLD 02 BEING A RELIABLE BUSINESS PARTNER 04 REDUCING COSTS 21
Slide 22: Driving Our Global Supply Chain Strategy
Driving our global supply chain strategy Being a reliable business partner Responding fast to a changing world DRIVING OUR Reducing costs GLOBAL SUPPLY CHAIN STRATEGY A Value-Driven Global Supply Chain 22
Slide 23: The Drivers of Our Global Supply Chain Strategy
THE 3 DRIVERS OF OUR GLOBAL SUPPLY CHAIN STRATEGY PEOPLE PROCESS TECHNOLOGY 23
Slide 24: Creating a Best-in-Class Workforce
CREATING A BEST-IN-CLASS WORKFORCE PEOPLE Enabling people development Ensuring we have the right talent in the right place Adapting the organization to anticipate business needs 24
Slide 25: Driving Agility by Practicing Lean Processes
DRIVING AGILITY BY PRACTICING LEAN PROCESSES PROCESS Establishing lean processes to drive value throughout our end-to-end value chain Aligning demand forecast and optimizing supply plan for factories, including expected inventory levels and financial impact Evaluating and balancing needs across our
Slide 26: Evaluating and Balancing Needs in Our Supply Chain
EVALUATING AND BALANCING NEEDS IN OUR SUPPLY CHAIN CUSTOMER SERVICE CAPACITIES WORKING & UTILIZATION CAPITAL 26
Slide 27: Transforming Operations with Improved Technology
TRANSFORMING OPERATIONS WITH IMPROVED TECHNOLOGY TECHNOLOGY Improving our day-to-day operations making them more digital and automated Leveraging powerful tools to support connectivity, collaboration and operational efficiency Upgrading our systems for faster decision making 27
Slide 28: Our Global Supply Chain Strategic Roadmap
OUR GLOBAL SUPPLY CHAIN STRATEGIC ROADMAP RELIABILITY RESPONSIVENESS REDUCING COSTS 28
Slide 29: Being a Reliable Business Partner
Driving our global supply chain strategy Being a reliable business partner BEING Responding fast to a changing world A RELIABLE Reducing costs BUSINESS PARTNER A Value-Driven Global Supply Chain 29
Slide 30: Optimizing Our Capacity to Produce and Deliver
OPTIMIZING OUR CAPACITY TO PRODUCE AND DELIVER WHAT WE DID DURING COVID-19 PANDEMIC Mask production Hydroalcoholic machine gel production Prioritizing Keeping Taking action our people’s production up with mask and safety and running gel production 30
Slide 31: Evaluating Our Supplier Base for Cost-Effective Sourcing
EVALUATING OUR SUPPLIER BASE TO ENSURE COST-EFFECTIVE SOURCING 300 10% strategic suppliers reduction of total number of suppliers in 1 year to ensure the most secure, to achieve a leaner organization innovative and efficient sourcing All of our Suppliers are part of BIC’s Responsible Procurement 202
Slide 32: Strengthening Our Agility by Leveraging Our OEMs
STRENGTHENING OUR AGILITY BY LEVERAGING OUR OEMS* DEVELOPMENT AND SOURCING OF FINISHED PRODUCTS ACCORDING TO BIC DESIGN INTENT Low capital Low High production High speed to investment volumes flexibility market capability * Original Equipment Manufacturers 32
Slide 33: Responding Quickly in a Fast-Changing Environment
Driving our global supply chain strategy Being a reliable business partner RESPONDING Responding fast to a changing world QUICKLY IN A Reducing costs FAST-CHANGING ENVIRONMENT A Value-Driven Global Supply Chain 33
Slide 34: Responding Quickly to Create Business Value
RESPONDING QUICKLY TO CREATE BUSINESS VALUE Portfolio management A solid Operating Model Taking on the new and segmentation to support our business transformation sustainability challenges to reduce complexity of a changing world 34
Slide 35: Creating Space for New SKUs by Reducing Complexity
CREATING SPACE FOR NEW AND INNOVATIVE SKUS BY REDUCING COMPLEXITY Over 13,000 -20% SKUs SKUs reduction target in our portfolio by 2022 35
Slide 36: Supporting Our Business Transformation with a Solid Operating Model
SUPPORTING OUR BUSINESS TRANSFORMATION WITH A SOLID OPERATING MODEL Idea Generation & Validation Stage gate process Source Validate Investigate Develop Deliver Launch Post Launch of Idea & Connect Question Integrated Prepare Go-To-Market Results White Space for Innovation Business Case Launch Plan P
Slide 37: Zero Accidents
BUILDING ON OUR EXCEPTIONAL SAFETY TRACK RECORD On track towards achieving our 2025 goal of ZERO ACCIDENTS across all operations at BIC Employee accident rate has already been reduced by 25% two years in a row 37
Slide 38: Reducing Costs
Driving our global supply chain strategy Being a reliable business partner Responding fast to a changing world Reducing costs REDUCING COSTS A Value-Driven Global Supply Chain 38
Slide 39: On Track to Deliver Our Cost Savings Targets
ON TRACK TO DELIVER OUR COST SAVINGS TARGETS GROUP SUPPLY CHAIN CONTRIBUTING TO MORE THAN 60% OF BIC'S TOTAL SAVINGS TARGET: 50M€ BY 2022 Direct procurement savings in 2020 Indirect procurement savings in 2020 >10M€ ~5M€ Projects related to raw materials 8% 17% 19% metal plastics reduction in plasti
Slide 40: Achieving Manufacturing Efficiencies
ACHIEVING MANUFACTURING EFFICIENCIES THROUGH CONTINUOUS PRODUCT OPTIMIZATION Shavers Stationery reducing the amount of steel by 27% automation of the assembly line per blade, while retaining excellent quality for the Mini Pocket Mouse: Increasing productivity by 15% Improving the quality 27% thinner
Slide 41: Managing Our Inventory Efficiently to Reduce Costs
MANAGING OUR INVENTORY EFFICIENTLY TO REDUCE COSTS Target-range of 15M€ to 30M€ in inventory reduction in 2020 driven by: Leveraging Decreasing our stock Reducing Sales and Operation Planning of raw materials and finished Slow and obsolete (S&OP) to better forecast goods inventory inventory levels 4
Slide 42: Optimizing Our Footprint
OPTIMIZING OUR FOOTPRINT Ecuador STATIONERY FACTORY CLOSURE To improve our Latin American manufacturing efficiency France BIC TECHNOLOGY MOVE TO MARNE-LA-VALLEE FACTORY To be more efficient & enhance economies of scale India CLOSURE OF ONE OF CELLO FACTORIES To adapt to the current environment 42
Slide 43: A Value-Driven Global Supply Chain
A VALUE-DRIVEN GLOBAL SUPPLY CHAIN 43
Slide 44: Raising the Bar of Our Commercial Excellence
RAISING THE BAR OF OUR COMMERCIAL EXCELLENCE CHESTER TWIGG Group Chief Commercial Officer 44
Slide 45: Agenda
AGENDA 01 OMNICHANNEL STRATEGY 03 PORTFOLIO APPROACH TO MARKET MANAGEMENT 02 REVENUE GROWTH MANAGEMENT 45
Slide 46: Omnichannel Strategy
Omnichannel Strategy Revenue growth management Portfolio approach to market management OMNICHANNEL STRATEGY Raising the bar of our commercial excellence 46
Slide 47: On Track to Drive E-Commerce Growth
ON TRACK TO DRIVE E-COMMERCE GROWTH 20 20 20 20 20 18 19 20 21 22 VISIBILITY MARKET SHARE GROWTH LEVERAGING >10% OF NET SALES GAIN ACCELERATION DIGITAL AMBITIONS IN E-COMMERCE 47
Slide 48: Where We Stand Today in Our Online Journey
WHERE WE STAND TODAY IN OUR ONLINE JOURNEY #1 ~2X 80% >2X ~4X Leading market positions online Growth in pure Media investment Sales conversion for DTC* Shopper traffic increase in Stationery, Lighters and eCommerce channels in digital websites globally for DTC * website in Europe one-piece Shavers *
Slide 49: Revenue Growth Management
Omnichannel Strategy Revenue growth management Portfolio approach to market management REVENUE GROWTH MANAGEMENT Raising the bar of our commercial excellence 49
Slide 50: Growing Value Through Revenue Growth Management Initiatives
GROWING VALUE THROUGH REVENUE GROWTH MANAGEMENT INITIATIVES TRADE AND PROMOTION PRICING ASSORTMENT DECISIONS AND INVESTMENTS Reducing complexity and Optimizing promotional strategy Driving value through leveraging our portfolio to place to increase efficiency appropriate pricing the right SKUs in th
Slide 51: Pricing: Growing Value Through Innovation with EZ Reach
PRICING: GROWING VALUE THROUGH INNOVATION WITH EZ REACH Driving category expansion by addressing new flame occasions. Combining the accessibility of pocket lighters with the functional benefits of the Multi-purpose lighter Already a top 5 SKU in BIC lighters 51
Slide 52: Pricing: Growing Value Through Premiumization with Djeep
PRICING: GROWING VALUE THROUGH PREMIUMIZATION WITH DJEEP Sustaining growth by broadening BIC's product portfolio Offering real value to consumers at a premium price Generating operational and commercial synergies On average 50% higher in value than the equivalent BIC lighters 52
Slide 53: Pricing: Growing Value Through Commercial Innovation with PrevaGuard
PRICING: GROWING VALUE THROUGH COMMERCIAL INNOVATION WITH PREVAGUARD Our new Antimicrobial pen Only 5 months from concept to our shelf 53
Slide 54: Assortment: Growing Value by Reducing Complexity
ASSORTMENT: GROWING VALUE BY REDUCING COMPLEXITY Driving complexity out of BIC’s business Example: Strong SKU optimization efforts in Brazil Benefits of this strategy Solves consumer choice paradox - ~25% SKU reduction Improves space utilization 10% Cost savings Reduces manufacturing and warehousing
Slide 55: Portfolio Approach to Market Management
Omnichannel Strategy Revenue growth management PORTFOLIO Portfolio approach to market management APPROACH TO MARKET MANAGEMENT Raising the bar of our commercial excellence 55
Slide 56: A Clear Strategy for All Our Markets
A CLEAR STRATEGY FOR ALL OUR MARKETS GROW IN A INVEST TO GROW PROFITABLE WAY BIC’s growth potential LEVERAGING MATURE CHANGING MODEL MARKETS BIC’s ability to capture growth profitably 56
Slide 57: Invest to Grow
INVEST TO GROW INVEST TO GROW where potential to grow market share has been identified to build a solid presence. Example: BIC’s growth potential Russia Germany Nigeria BIC’s ability to capture growth profitably 57
Slide 58: Changing Model
CHANGING MODEL CHANGING MODEL BIC’s growth potential where working with a partner makes more sense. Example: Colombia South Korea BIC’s ability to capture growth profitably 58
Slide 59: Grow in a Profitable Way
GROW IN A PROFITABLE WAY GROW IN A PROFITABLE WAY where opportunities are identified to drive growth while maintaining our profitability Example: BIC’s growth potential USA BIC’s ability to capture growth profitably 59
Slide 60: Leveraging Mature Markets
LEVERAGING MATURE COUNTRIES LEVERAGING MATURE MARKETS BIC’s growth potential where profitability and commercial efficiency should be our primary focus. Example: Japan BIC’s ability to capture growth profitably 60
Slide 61: Building Strong Talent Capabilities to Drive Commercial Excellence
BUILDING STRONG TALENT CAPABILITIES TO DRIVE OUR COMMERCIAL EXCELLENCE Leveraging talent to drive commercial expertise Implement world class commercial organization Drive and deliver commercial algorithm 61
Slide 62: Raising the Bar of Our Commercial Excellence
RAISING THE BAR OF OUR COMMERCIAL EXCELLENCE 62
Slide 63: Expand Our Horizon
EXPAND OUR HORIZON SARA LAPORTA Chief Strategy & Business Development Officer 63
Slide 64: Agenda
AGENDA EXPANDING DOUBLING-DOWN 01 OUR FUNCTIONAL CAPABILITIES TO DRIVE 03 ON OUR SUSTAINABLE DEVELOPMENT STRATEGY PROFITABLE GROWTH REFRAMING 02 OUR CATEGORIES FOR ACCELERATED GROWTH 64
Slide 65: Expanding Our Functional Capabilities to Drive Profitable Growth
Expanding our functional capabilities to drive profitable growth Reframing our categories for accelerated growth EXPANDING OUR Doubling-down on our sustainable development FUNCTIONAL strategy CAPABILITIES TO DRIVE PROFITABLE GROWTH Expand our Horizon 65
Slide 66: Expanding Our Functional Capabilities to Drive Profitable Growth
EXPANDING OUR FUNCTIONAL CAPABILITIES TO DRIVE PROFITABLE GROWTH 18 MONTHS OF TRANSFORMATION FROM A PRODUCT-DRIVEN TO A CONSUMER-DRIVEN MINDSET OPEN COMMERCIAL VALUE DRIVEN FINANCIAL INNOVATION EXCELLENCE GLOBAL DISCIPLINE SUPPLY CHAIN 66
Slide 67: Reframing Our Categories for Accelerated Growth
Expanding our functional capabilities to drive profitable growth Reframing our categories for accelerated growth REFRAMING OUR Doubling-down on our sustainable development strategy CATEGORIES FOR ACCELERATED GROWTH Expand our Horizon 67
Slide 68: Reframing Our Categories for Accelerated Growth
REFRAMING OUR CATEGORIES FOR ACCELERATED GROWTH Invest Create Develop Perform Human Flame Expression for Life Blade Excellence 68
Slide 69: Reframing Our Categories: Human Expression
REFRAMING OUR CATEGORIES FOR ACCELERATED GROWTH Inv Cre Dev Human Expression Per Adopt a Consumer-lens to Stationery category expansion, adapt to shifting consumer habits and expand in faster- growing Creative Expression and Digital Writing Markets 69
Slide 70: Reframing Our Categories: Flame for Life
REFRAMING OUR CATEGORIES FOR ACCELERATED GROWTH Invest Create Develop Flame For Life Perform Sustain Profitability and grow the Lighter Business by leveraging all flame occasions and evolve to a value-driven model 70
Slide 71: Reframing Our Categories: Blade Excellence
REFRAMING OUR CATEGORIES FOR ACCELERATED GROWTH Blade Excellence Capitalize on our assets, advanced innovation and manufacturing capabilities to sustain growth momentum 71
Slide 72: Expanding Our Total Addressable Market
REFRAMING OUR CATEGORIES FOR ACCELERATED GROWTH Invest Expanding our total Create addressable market Develop Perform Human Flame Expression for Life Shifting to a revenue-realization mindset in mature markets Blade Excellence Capitalizing on our core assets to open up opportunities 72
Slide 73: From Stationery to Human Expression
‘Tempoaany FROM STATIONERY iii Pree a “Ve sare YGiC? 73
Slide 74: Increase Total Addressable Market
INCREASE TOTAL ADDRESSABLE MARKET 2019 2025 €bn €bn Digital Writing +9.4% p.a. Tattooing +4.6% p.a. ~ 19bn ~ 4bn Writing ~ 5bn instruments ~ 23bn ~ 50bn Arts & Crafts +6.5% p.a. Writing instruments +4.1% p.a. SOURCE: Euromonitor 2019, Creative Industries, IBIS World, BIC analysis P.a : per annum 74
Slide 75: Arts and Crafts
ARTS AND CRAFTS Art & Creative Creative Teens & Adults Kids 75
Slide 76: Arts and Crafts
ARTS AND CRAFTS BIC INTENSITY 76
Slide 77: Body Arts
BODY ARTS BODYMARK ig 1b) : a ETE | (( 'Gig 7
Slide 78: Digital Writing: A Nascent Segment
DIGITAL WRITING A NASCENT SEGMENT - DIRECTLY ADJACENT TO OUR WRITING INSTRUMENTS CATEGORY 2019 €bn 2025 €bn Digital notebooks & slates ~0.5bn Digital pen +4.8% p.a. +10.4% p.a. ~0.7bn ~1.4bn Active stylus ~0.3bn +5-7% p.a. ~2.8bn ~0.5bn Digital writing ~ 2.2bn Digital writing Total addressable marke
Slide 79: To Blade Excellence
TO BLADE EXCELLENCE 79
Slide 80: Blade Excellence
BLADE EXCELLENCE ENHANCE CORE ONE-PIECE CAPITALIZE ON OUR BUSINESS WITH INNOVATION STRENGTHS, ADVANCED R&D, AND SUSTAINABILITY AND EXCELLENCE IN MANUFACTURING TO BUILD A SELECTIVE NEW BUSINESS BY ENABLING OTHER BRANDS TO ACCESS WORLD-CLASS PERFORMANCE CAPABILITIES 80
Slide 81: Blade Excellence: Enhance Core One-Piece Business
BLADE EXCELLENCE ENHANCE CORE ONE-PIECE BUSINESS WITH INNOVATION AND SUSTAINABILITY 81
Slide 82: Blade Excellence
BLADE EXCELLENCE CAPITALIZE ON OUR STRENGTHS, ADVANCED R&D, AND EXCELLENCE IN MANUFACTURING TO BUILD A SELECTIVE NEW BUSINESS BY 2019 2025 ENABLING OTHER BRANDS TO €bn €bn ACCESS WORLD-CLASS PERFORMANCE CAPABILITIES ~ 4bn One piece Shaver market ~ 15bn Wet shave market Total addressable market SOURC
Slide 83: Doubling-Down on Our Sustainable Development Strategy
Expanding our functional capabilities to drive profitable growth DOUBLING- Reframing our categories to accelerate growth DOWN ON OUR Doubling-down on our sustainable development strategy SUSTAINABLE DEVELOPMENT STRATEGY Expand our Horizon 83
Slide 84: Doubling-Down on Our Sustainable Development Strategy
DOUBLING-DOWN ON OUR SUSTAINABLE DEVELOPMENT STRATEGY Taking our circular economy journey to the next level by transforming the way we use plastics 84
Slide 85: Transforming the Way We Use Plastics
TRANSFORMING THE WAY WE USE PLASTICS TWO AMBITIOUS TARGETS Packaging Products By 2025 By 2030 By 2025 100% Reusable, recyclable or compostable 50% 20% non virgin as intermediate 100% 100% 75% petroleum plastics step Recycled or certified PVC Free Recycled content in cardboard plastics plastic packag
Slide 86: A Clear Roadmap: BIC's 4R Philosophy
A CLEAR ROADMAP BIC’S 4R PHILOSOPHY Recycled Recyclability Reduce / Alternative Materials Refillable / End of life Reduce our raw Replace virgin plastic Reduce the overall Support the availability material consumption by using recycled plastic consumption of recycled plastics by ensuring or alternat
Slide 87: Sustainability Across Categories
Flame Sustainability for Life Human Expression Blade Excellence 87
Slide 88: Expand Our Horizon
EXPAND OUR HORIZON 88
Slide 89: Digital Writing
DIGITAL WRITING THOMAS BRETTE Group Insights and Innovation Officer 89
Slide 90: Agenda
AGENDA 01 ENTERING DIGITAL WRITING 02 ROCKETBOOK 90
Slide 91: Entering Digital Writing
Entering Digital Writing Rocketbook ENTERING DIGITAL WRITING Digital Writing 91
Slide 92: Gig
Gig 92
Slide 93: Digital Writing: A Billion Euro Market by 2025
DIGITAL WRITING A 4 BILLION EURO MARKET BY 2025 Analog to Digital Digital Stylus for Tablets Price Point Pressure-Sensitive Capture with Paper Slate Writing Smart Pens Tablets Reusable Notebooks Digitalization 93
Slide 94: Digital Writing: A Billion Euro Market by 2025
DIGITAL WRITING A 4 BILLION EURO MARKET BY 2025 Analog to Digital Digital Stylus for Tablets Price Point Pressure- Sensitive Capture with Paper Slate Writing Smart Pens Tablets Reusable Notebooks Digitalization 94
Slide 95: Rocketbook
Entering Digital Writing Rocketbook ROCKETBOOK Digital Writing 95
Slide 96: Rocketbook
I i! ROCKET BOOK Gig
Slide 97: in Y O O ca |I-— Lu Y O O ~ Gig
in Y O O ca |I-— Lu Y O O ~ Gig
Slide 98: 98
98
Slide 99: Digital Writing
DIGITAL WRITING 99
Slide 100: Flame for Life
FLAME FOR LIFE FRANÇOIS CLEMENT-GRANDCOURT Group Lighter General Manager 100
Slide 101: Agenda
AGENDA TRANSFORMING TO A 01 A LIGHTER IS AN ESSENTIAL ITEM 03 VALUE-DRIVEN MODEL FOCUSING ON ALL BUILDING COMPETITIVE 02 CONSUMER LIGHTING OCCASIONS 04 ADVANTAGE THROUGH SUSTAINABILITY 101
Slide 102: A Lighter Is an Essential Item
A lighter is an essential item Focusing on all consumer lighting occasions Transforming to a value-driven model A LIGHTER IS AN Building competitive advantage through sustainability ESSENTIAL ITEM Flame for Life 102
Slide 103: A Flame Is Essential
"A FLAME IS ESSENTIAL" 103
Slide 104: Lighter Usage
LIGHTER USAGE 89% 48% 63% of adults globally of flame usage is for 31% use flames throughout non-smoking purposes the year Developed Developing Countries Countries In developed countries, 31% of flames are for non-smoking usage; in developing countries 63% of people mainly use flames for non-smoking
Slide 105: Flame Ignition
FLAME IGNITION Penetration per Flame Devices (%) Claimed Share of Flames per Flame Device (Utility lighters represent less than 0.1%) Sparklers 13% Matches 27% Pocket Lighter 60% SOURCE: Usage & Attitude - 33 Countries – 2016 105
Slide 106: Focusing on All Consumer Lighting Occasions
A lighter is an essential item Focusing on all consumer lighting occasions FOCUSING ON Transforming to a value-driven model ALL CONSUMER Building competitive advantage through sustainability LIGHTING OCCASIONS Flame for Life 106
Slide 107: Focusing on All Consumer Lighting Occasions
FOCUSING ON ALL CONSUMER LIGHTING OCCASIONS UNITED STATES MEXICO Other BBQ Emergency Prep 3% Gas Oven 4% 7% 5% Logs 7% BBQ Tobacco Tobacco 10% 48% 27% LIGHTING Gas Stove LIGHTING 36% OCCASIONS OCCASIONS Candle & Incense Candle & Incense 25% 17% Others 9% SOURCE: Hannover Research 2019 IPSOS – Mexico
Slide 108: Capitalizing on New Opportunities
FOCUSING ON ALL CONSUMER LIGHTING OCCASIONS CAPITALIZING ON NEW OPPORTUNITIES Everyday Cooking Lighting Candles Fireplace Birthday Parties Romantic Dinners BBQ & Grilling Relaxing 108
Slide 109: EZ Reach
FOCUSING ON ALL CONSUMER LIGHTING OCCASIONS EZ REACH 109
Slide 110: Transforming to a Value-Driven Model
A lighter is an essential item Focusing on all consumer lighting occasions Transforming to a value-driven model TRANSFORMING Building competitive advantage TO A VALUE- through sustainability DRIVEN MODEL Flame for Life 110
Slide 111: Personalizing Our Offer
TRANSFORMING TO A VALUE-DRIVEN MODEL PERSONALIZING OUR OFFER Think of the Possibilities! Birthdays, weddings, bachelorette parties are just a few of customizable occasions for our Design My BIC lighters. If you can dream it up, we can print it ! 111
Slide 112: Trading Up: Decorated Lighters Share of Sales
TRANSFORMING TO A VALUE-DRIVEN MODEL TRADING UP Decorated Lighters as % of total Lighter Net Sales 35% 36% 32% 32% 30% 26% 26% 23% 23% 21% 2015 2016 2017 2018 2019 Total Group United States 112
Slide 113: Implementing Revenue Growth Management
TRANSFORMING TO A VALUE-DRIVEN MODEL IMPLEMENTING REVENUE GROWTH MANAGEMENT TRADE AND PROMOTION PRICING ASSORTMENT DECISIONS AND INVESTMENTS 113
Slide 114: Personalizing Our Offer
TRANSFORMING TO A VALUE-DRIVEN MODEL PERSONALIZING OUR OFFER Sustain Offer Generate growth real value operational by broadening to consumers and BIC's product at a premium commercial portfolio price synergies J25 J25 Decor J26 J26 Decor Djeep EZ Reach J26 U140 U110 Personalization 114
Slide 115: Building Competitive Advantage Through Sustainability
A lighter is an essential item Focusing on all consumer lighting occasions BUILDING Transforming to a value-driven model COMPETITIVE Building competitive advantage through sustainability ADVANTAGE THROUGH SUSTAINABILITY Flame for Life 115
Slide 116: BIC Lighter Life Cycle
BIC LIGHTER LIFE CYCLE Usage & End-of-life Raw Materials & Eco-design • Collection • Sustainable sourcing • Recycling • Alternative materials • Exploring new design Packaging Production & Logistics • Less packaging • Plant performance • Environmentally friendly • Waste management packaging • Improve
Slide 117: Building Competitive Advantage Through Sustainability
BUILDING COMPETITIVE ADVANTAGE THROUGH SUSTAINABILITY BIC Maxi Standard BIC Maxi Ecolutions Pusher Pusher Red Pusher in Nylon Recycled POM Fork & Cheeks Fork & Cheeks Female Cheek in recycled Zamak 100% recycled Zamak Spark wheel Spark wheel 100% recycled scrap metal 100% recycled scrap metal Flint
Slide 118: Flame for Life
FLAME FOR LIFE 118
Slide 119: Finance and Capital Allocation
FINANCE AND CAPITAL ALLOCATION CHAD SPOONER Chief Financial Officer 119
Slide 120: Agenda
AGENDA 01 FINANCIAL HIGHLIGHTS 04 GROUP TARGETS 02 ITF UPDATE 05 CAPITAL ALLOCATION 03 CATEGORY UPDATE 120
Slide 121: Financial Highlights
Financial Highlights ITF update Category update FINANCIAL Group Targets HIGHLIGHTS Capital Allocation Finance and Capital Allocation 121
Slide 122: Historic Performance
HISTORIC PERFORMANCE SLOWING GROWTH RESILIENT PROFITABILITY Net Sales Organic Growth Adjusted EBITDA Adjusted EBIT Margin (Normalized IFO margin) 6.2% +2.3% 23.3% 24.3% 24.1% 22.8% 22.2% 4.2% 5 years average 20.2% 19.3% 19.6% 18.1% 17.0% 1.4% 1.5% 2015 2016 2017 2018 2019 Adjusted EBITDA margin Adju
Slide 123: Historic Performance: CAPEX and Working Capital
HISTORIC PERFORMANCE CAPEX CHANGE IN WORKING CAPITAL In M€ In M€ 2.1 2.0 1.3 1.3 1.1 -8.1 -24 -21,1 176 184 121 124 114 -62.8 -73 2015 2016 2017 2018 2019 2015 2016 2017 2018 2019 CAPEX CAPEX to D&A 2016 et 2017: excluding BIC Graphic North America 123
Slide 124: Robust Cash Flow Generation
ROBUST CASH FLOW GENERATION NET CASH In M€ 89% 81% 77% 79% 64% 436 381 315 318 299 304 197 205 176 184 180 121 123 124 114 2015 2016 2017 2018 2019 Net Cash From Operating Activities CAPEX Free Cash Flow before Acquisitions Net Cash Conversion* 2016 et 2017 CAPEX: excluding BIC Graphic North America
Slide 125: Source and Use of Funding
SOURCE AND USE OF FUNDING In M€ 14 315 117 161 74 160 56 6 16 12 158 205 197 155 180 135 123 82 97 54 39 26 Source of Use of Source of Use of Source of Use of Source of Use of Source of Use of Funds 2015 funds 2015 funds 2016 funds 2016 funds 2017 funds 2017 funds 2018 funds 2018 funds 2019 funds 20
Slide 126: Sustained Total Shareholder Remuneration
SUSTAINED TOTAL SHAREHOLDER REMUNERATION In € In M€ 55% 55% 59% 50% 45% 6.77 97 6.24 6.26 5.87 82 5.47 54 3.40 3.45 3.45 3.45 39 2.50 2.45 26 2015 2016 2017 2018 2019 2015 2016 2017 2018 2019 Dividend per share Exceptional dividend Share Buyback Normalized EPS per share Pay-out ratio 126
Slide 127: ITF Update
Financial Highlights ITF update Category update Group Targets ITF UPDATE Capital Allocation Finance and Capital Allocation 127
Slide 128: BIC 2022 - Invent the Future
BIC 2022- INVENT THE FUTURE ROADMAP 20 ROLL-OUT • Strengthen market positions 20 19 • Extend brand leadership • Expand in e-commerce 22+ • Speed-up product launches • Reinforce and consolidate overall efficiency SET THE FOUNDATIONS FULL IMPACT • Consumer-centric innovation 20 • Operational effective
Slide 129: Invent the Future Targets
INVENT THE FUTURE TARGETS SAVINGS 80% SAVINGS achieved by the end of 2021 50 M€ 7% End-to-End Supply Chain 28% Commercial Excellence Efficient Support Functions 65% App. 5 M€ 2019 2020 2021 2022 End of 2022 129
Slide 130: Adapting to COVID-19: Cost Optimization
ADAPTING TO COVID-19 COST OPTIMIZATION Others 20% Travel and Labor Expenses Training 51% 12% Discretionery Expenses 17% Year to Date September 2020 130
Slide 131: Category Update
Financial Highlights ITF update Category update CATEGORY Group Targets UPDATE Capital Allocation Finance and Capital Allocation 131
Slide 132: Stationery: Writing Instruments
STATIONERY WRITING INSTRUMENTS Fragmented Industry Complex Product Offering Slowing Average Annual Growth (CAGR) Faber- Castell 4% Ball Pens Newell Others 23% M&G 9% 4.5% 33% 4.1% 4% 19 Bn € 19 Bn € 3.2% In value In value Roller & Gel Pilot 15% 6% Marking BIC Coloring 17% 9% 13% Writing Instruments
Slide 133: Pivoting to Human Expression
PIVOTING TO HUMAN EXPRESSION 2019 2025 Net Sales Growth €bn €bn and Profitability driven by Digital Stationery Tattooing +9.4% p.a. +4.6% p.a. Development in Creative Expression ~ 19bn ~ 4bn ~ 5bn Expansion in the fast-growing Digital Writing market Writing instruments ~ 50bn ~ 23bn SKU and product
Slide 134: Lighters
LIGHTERS Concentrated Industry BIC market leader in value Flat to declining Average Annual Growth (CAGR) 6% 8% 32% 1.7% 44% 17% 4.7 Bn € 4.7 Bn € 1.0% In value In value 57% 6% 25% 3% -1.0% Lighters 1% Asian Player Flamagas 5 Years 3 Years 1 year Others Latin America North Amercia Europe Swedish Matc
Slide 135: Expanding to Flame for Life
EXPANDING TO FLAME FOR LIFE UNITED STATES Net Sales Growth Other and Profitability Emergency Prep 3% driven by 7% Logs 7% Revenue Growth Management Tobacco 48% FLAME Incremental usages BBQ OCCASIONS from consumer for 10% all flame occasions A value-driven Business Model Candle & Trade-up Incense 25%
Slide 136: Shavers
SHAVERS Driven by the Refillable segment Concentrated Competitive Set Flat to slightly increasing Average Annual Growth (CAGR) 3% 16% 2% 1.2% 5% 1.0% 7% 12 Bn € 39% 12 Bn € In value In value 58% 58% 0.3% 13% Wet Shave 5 Years 3 Years 1 year Procter & Gamble Edgewell BIC Private Label Refilable One-P
Slide 137: Leveraging Blade Excellence
LEVERAGING BLADE EXCELLENCE 2019 2025 Net Sales Growth €bn €bn and Profitability driven by Innovation in the core one-piece segment ~ 4bn Focus on key markets ~ 15bn Wet shave market One-piece shavers Best utilize our assets as a high-precision manufacturer for other brands TAM: total addressable ma
Slide 138: Group Targets
Financial Highlights ITF update Category update GROUP Group Targets TARGETS Capital Allocation Finance and Capital Allocation 138
Slide 139: Horizon Plan Financial Targets
HORIZON PLAN FINANCIAL TARGETS Accelerated and Sustainable Robust Cash Growth Generation Mid-Single Digit > 200 M€ Run Rate Growth trajectory Free Cash Flow 139
Slide 140: Capital Allocation
Financial Highlights ITF update Category update CAPITAL Group Targets ALLOCATION Capital Allocation Finance and Capital Allocation 140
Slide 141: Capital Allocation Policy
CAPITAL ALLOCATION POLICY Fund Profitable Ensure Sustainable Growth Shareholder Returns 141
Slide 142: Capital Allocation Policy
CAPITAL ALLOCATION POLICY Fund Profitable Ensure Sustainable Growth Shareholder Returns Investments into Operations (CAPEX) Ordinary Dividend Targeted Acquisitions Share Buyback 142
Slide 143: BIC's Long-Term Value Creation Business Model
BIC’S LONG-TERM VALUE CREATION BUSINESS MODEL Bringing simplicity and joy to everyday life Creating high quality, safe, affordable, essential products trusted by everyone Consumer-Centric Brands Open and Responsible Sustained 1 2 3 Innovation and balanced Efficient, Reliable, and Sustainable Global
Slide 144: Finance and Capital Allocation
FINANCE AND CAPITAL ALLOCATION 144