Glanbia Plc · EURONEXT:GL9
Glanbia — FY2010 Earnings Presentation
23 slides from Glanbia's earnings presentation, Mar 22, 2011
Slide 1: 2010 Full Year Results
2010 2010 FULL YEAR FULLYEAR 2010 FULL RESULTS YEARRESULTS 22March March, 2011 March 2011 2011
Slide 2: Cautionary statement
Cautionary statement This presentation contains forward-looking statements. These statements have been made by the Directors in good faith based on the information available to them up to the time of their approval of this presentation. Due to the inherent uncertainties, including both economic and
Slide 3: 2010 results highlights
2010 results highlights • Excellent results • Strong revenue and EPS growth • Strong organic revenue growth in Global Nutritionals • More favourable global dairy markets • Dairy Ingredients Ireland returns to profit • Irish strategic cost reduction programmes deliver 2010 FULL YEAR RESULTS Slide 3
Slide 4: Market overview
Market overview • Positive global dairy markets for most of 2010 • Demand led growth in key nutritional sectors • Converging consumer themes: o Growing global dairy consumption, driven by Asia o Clean label and natural ingredients, driven by consumer awareness and concerns o Growing demand for perfo
Slide 5: Results pre exceptional
Results pre exceptional Change on FY 2009 FY 2010 Reported Constant currency Revenue1 €2.2 billion Up 18.4% Up 15.6% EBITA2 €151.6m Up 21.3% Up 21.4% EBITA margin 7.0% Up 20bps Up 40bps Operating profit €136.5m Up 22.8% Up 22.8% Operating margin 6.3% Up 20bps Up 40bps Share of results of Joint Ventu
Slide 6: 2010 divisional results
2010 divisional results • Including Joint Ventures & Associates 2010 revenue ↑ 21.4% 2010 EBITA ↑ 21.6% EBITA margin 4.2% 28% EBITA margin 44% EBITA margin €2.6 40% 5.2% 12% €173.2 10.2% (constant billion million currency 10.8%) 16% 60% US Cheese & Global Nutritionals: €1 billion revenue ↑ 29.0%; €1
Slide 7: Total Group revenue analysis
Total Group revenue analysis €m 2,900 Total Group revenue • Total Group revenue grew 21.4% to €2.6 billion 2,700 3.1% €2.6 bn 11.0% • Strong volume growth in Global 2,500 Nutritionals and Joint Ventures & 2,300 7.3% Associates €2.1 bn 2,100 o Global Nutritionals outpaced market 1,900 growth 1,700 o
Slide 8: Total Group EBITA analysis
Total Group EBITA analysis €173.2m Higher milk costs ↑21.6% €142.4m Higher operating costs in US Cheese & Global Nutritionals – investment in resources (people, services, brand) Recovery in pricing for Dairy Ingredients Ireland Price competition in Consumer Products Cost savings in Dairy Ireland Vol
Slide 9: Total Group EBITA margin
Five year trends : 2006 to 2010 Transformational Growth • 5% five year CAGR in total Group revenue • 16% five year CAGR in total Group EBITA • 10% five year CAGR in total Group EBITA margin • €476 million five year acquisition and strategic capital expenditure % Total Group EBITA margin US Cheese &
Slide 10: Financing KPIs
Financing KPIs FY 2010 FY 2009 Change EBITDA €182.8m €152.5m Up 19.9% Free cash flow €65.5m €66.1m (€0.6m) Net debt €408.1m €442.6m (€34.5m) Net debt/Adjusted EBITDA1 2.1 times 2.6 times - Return on capital employed2 12.9% 11.2% Up 170bps 1 Adjusted EBITDA for the purpose of financing ratios reflect
Slide 11: Outlook and summary
Outlook and summary • Global dairy markets are forecast to remain firm, with robust demand • Including BSN, 2011 adjusted EPS growth of 11% to 13%, on a constant currency basis • Strategy and Favourable outlookand industry trends consumer • Science-based innovation capability • Scale business with m
Slide 12: Leading positions
Leading positions • Dairy Ireland • US Cheese • Whey solutions • Micronutrients • Performance nutrition 2010 FULL YEAR RESULTS Slide 12
Slide 13: Global presence
Global presence UK Canada Ireland Germany Belgium South Korea USA China Mexico Malaysia Nigeria Singapore Indonesia Brazil Australia Sales/technical support locations Uruguay Manufacturing/processing and customer service locations Export/product distribution locations • Strong global presence in key
Slide 14: Dairy Ireland model
Dairy Ireland model • Revenue €1.1 billion • EBITA margin 4.2% Dairy Ingredients Europe 1.5 billion litres of milk Americas processed; 214,000 tonnes of dairy-based Asia Milk production ingredients Africa >5,000 farmer suppliers in Ireland Exports to more than 50 countries 1.8 billion litres Agribus
Slide 15: US Cheese & Global Nutritionals business model
US Cheese & Global Nutritionals business model • Revenue €1 billion • EBITA margin 10.8% in constant currency Stronger market growth rates Performance Nutrition Sustainable higher margins Increasing innovation rate Global Customised Premix Solutions Nutritionals Ingredient Technologies US Cheese Lar
Slide 16: 2011 acquisition of BSN
2011 acquisition of BSN • $144 million (€108 million) total consideration 2010 proforma revenue Including Joint Ventures & Associates • A leading US performance nutrition business Global Nutritionals 23% • Extends existing performance nutrition portfolio • Creates scale position in attractive high m
Slide 17: Clear strategy in execution mode
Clear strategy in execution mode STRATEGY DAIRY IRELAND US CHEESE & GLOBAL NUTRITIONALS* Customised Dairy Consumer Ingredient Performance Agribusiness Cheese Premix Ingredients Products Technologies Nutrition Solutions Volume / market share growth Focus on R&D and innovation -
Slide 18: Outlook and summary
Outlook and summary • Clear strategy, supported by core Group competencies • Good sectors, market positions and growth opportunities • Favourable market and industry trends • Science-based innovation capability • Scale business with developed routes to market • Well positioned to continue delivery 2
Slide 19: Outlook and summary
Outlook and summary • Global dairy markets are forecast to remain firm, with robust demand • Including BSN, 2011 adjusted EPS growth of 11% to 13%, on a constant currency basis • Supplementary information Favourable consumer and industry trends • Science-based innovation capability • Scale business
Slide 20: Segmental analysis
Segmental analysis 2010(1) 2009 Operating Operating EBITA Operating Operating EBITA Revenue profit Margin EBITA(2) Margin Revenue profit Margin EBITA Margin €m €m €m €m €m €m US Cheese & Global Nutritionals 1,021.9 93.8 9.2% 104.5 10.2% 792.4 90.0 11.4% 100.3 12.7% Dairy Ireland 1,138.6 43.5 3.8% 47
Slide 21: 2010 summary cash flow
2010 summary cash flow 2010 2009 Change €m €m €m EBITDA pre exceptional 182.8 152.5 30.3 Working capital movement (53.6) (18.8) (34.8) Net interest and tax paid (34.5) (30.7) (3.8) Business sustaining capital investment (17.3) (20.1) 2.8 Other (including additional pension contributions) (11.9) (16.
Slide 22: 2010 summary balance sheet
2010 summary balance sheet 2010 2009 Change €m €m €m Property, plant and equipment 369.4 363.2 6.2 Investments 84.8 88.7 (3.9) Intangible assets 356.8 342.1 14.7 Non-current receivables 23.1 50.5 (27.4) Deferred tax/capital grants (87.2) (72.9) (14.3) Working capital 177.7 101.6 76.1 Retirement bene
Slide 23: 2010 Full Year Results
Glanbia plc, Glanbia House, Kilkenny, Ireland. Tel +353 56 777 2200 Fax +353 56 777 2222 2010 FULL YEAR RESULTS Slide 23