Slide 1: 2021 Full Year Results
25 August 2021 2021 Full Year Results Tim Welsh: CEO & Managing Director Iona MacPherson: CFO
Slide 2: Important Information
Important Information This Presentation contains the summary information about the current activities of Pro-Pac Packaging Any forecasts or other forward-looking statements contained in this Presentation are subject to Limited and its controlled entities (Pro-Pac Packaging or the Group). It should b
Slide 3: About Pro-Pac
About Pro-Pac • Bespoke flexible packaging solutions specifically tailored for the industrial, food and beverage, health and agriculture sectors Flexibles Packaging • Stretch & shrink wrap, agricultural silage packaging, fresh produce bags, barrier and lidding films, industrial protective films • Hi
Slide 4: FY21 Highlights
FY21 Highlights Pro-Pac Packaging Limited 4
Slide 5: A Zero Harm Focus
A Zero Harm Focus Our leadership is committed to building a disciplined safety culture that sustainably protects our people and enhances operational performance TRIFR reduced by 35.6% to 9.36 FY21 COVID-19 Update • Strict protocols in place to protect the safety, health & wellbeing of Targeting Zero
Slide 6: A Successful Transformation in Challenging Conditions
A Successful Transformation in Challenging Conditions Major strategic initiatives achieved against the backdrop of COVID-19, highlighting the extraordinary efforts of the team • Chester Hill site closed on budget in July 2021 ($13m cash^) • Commissioned 7-layer extruder and laminator in May ($7m cap
Slide 7: Delivering on the Strategy
Delivering on the Strategy Significant business transformation achieved with completion of identified priorities • Delivered a strong operating result in a year of significant disruption due to transformation projects and the COVID-19 pandemic • Major restructuring projects are now complete and are
Slide 8: FY21 Financial Highlights
Profit after tax (underlying) FY21 Financial $13.2m up 29% (FY20: $10.2m) Highlights Profit after tax $7.8m up 18% (FY20: $6.6m) Strong financial and operational results during a year of transformation Operating Cashflow Conversion • Navigated the COVID-19 pandemic challenges, with a 107% (FY20: 136
Slide 9: FY21 Results
FY21 Results Pro-Pac Packaging Limited 9
Slide 10: Financial Results Summary
Financial Results Summary Strong financial performance overall, A $ million Statutory results: FY21 FY20 Change characterised by margin uplift and strong Revenue 440.1 478.2 (38.1) balance sheet Profit after tax 7.8 6.6 1.2 • Revenues declined as a result of portfolio reshaping, divestments, market
Slide 11: Revenue
Revenue While revenue has declined, the company has become more profitable and has built a platform for growth • FY21 revenue was $440.1m compared to $478.2m in the prior year. Revenue declined due to: • Flexibles’ exit from the Australian forage market, the Canadian market and the divestment of the
Slide 12: Cash Flow
Cash Flow Strong and sustained operating Operating cash flow conversion* cash flow conversion* Operating cash flow conversion 175% Key cash flow metrics 150% 150% 136% A$ m i l l i o n s FY21 FY20 Change Operating cash flow* 48.5 63.0 (14.5) 125% 112% 107% Capital expenditure* (14.5) (6.2) (8.3) 103
Slide 13: Balance Sheet
Balance Sheet Strong balance sheet with flexibility to fund Working capital* (A$m) future growth Working Capital A$m 125.0 Key balance sheet metrics 100.0 101.8 98.4 75.0 A$m illion s JUN-21 JUN-20 Change 82.3 81.4 Working capital* 81.4 82.3 (0.9) 50.0 Net debt* 51.0 45.1 5.9 25.0 Gearing* 1.5x 1.4x
Slide 14: Flexibles
Flexibles FY21 Review Revenue changes • Targeted shift of business mix towards higher margin products • Divestments and market exits Successfully delivered on key • Temporary lower cotton wrap demand compounded by foreign transformation projects currency Major transformation and investment for growt
Slide 15: Industrial Specialty Packaging
FY21 Review Industrial Specialty • The Industrial business returned to profitability with an improvement in PBT* of $3.8m • Consistent with our strategy, Management refocused the product Packaging range to higher margin market sectors • Global shipping constraints delayed the recognition of sales in
Slide 16: Rigid
Rigid FY21 Review • Rigid normalised revenues and margins after a strong COVID-19 demand in FY20 and 1H21 Sustainable solutions for • In 2H20 and 1H21, the COVID-19 pandemic provided sales and small to medium enterprise margin opportunities, particularly for bottles, triggers and pumps for hand sani
Slide 17: Strategic Priorities
Strategic Priorities Pro-Pac Packaging Limited 17
Slide 18: Our Purpose and Priorities
Our Purpose and Priorities Packaging is a critical industry that touches the Our purpose is to create better lives for our lives of millions of Australians and New Zealanders people, our customers, our communities every day and the planet Key Priorities We have transformed the underlying business ov
Slide 19: #1 Driving revenue growth
#1 Driving revenue growth Profitable growth is a priority Focus on driving top line growth in FY22 • Increasing qualified pipeline of higher margin value add products • Focus business development in market verticals and categories that play to Pro-Pac’s core strengths • Extract full value from the n
Slide 20: #2 Operational Efficiencies
#2 Operational Efficiencies Enterprise Resource Planning • Successful implementation of ERP Finance & Accounting went live in March 2021 Continue operational transformation • The next priority is Supply Chain & Manufacturing (SCM) starting with to enable efficient growth the Flexibles business unit
Slide 21: #3 Innovation
#3 Innovation Pro-Pac believes in an unconstrained approach to innovation that involves our people, our customers and our community • Head of Innovation appointed to drive a culture of innovation across the business • Pro-Pac is a leader in transforming redundant plastics into innovative high perfor
Slide 22: #4 Sustainability
#4 Sustainability Pro-Pac is committed to taking a leading role in the circular economy Pro-Pac’s sustainability charter aligns with the UN Sustainable Development Goals Better Planet • Reducing the environmental impact of our products - reduce, reuse, recycle through innovation and partnerships • P
Slide 23: Outlook
Outlook Tim Welsh. CEO & Managing Director Pro-Pac Packaging Limited 23
Slide 24: Outlook
Outlook We will continue to prioritise the safety, health and wellbeing of our people and the supply of essential products and services to our customers. We remain focused on the elements we can directly control and remain confident in our ability to deliver on growth and strategic priorities agains
Slide 25: Appendices
Appendices Pro-Pac Packaging Limited 25
Slide 26: Sustainability in Action
Sustainability Envire manufactures a range of tough, long life sustainable products with a lifespan 3-4 times longer than timber and recyclable in Action at the end of its life. Manufacturing sustainable products in We manufacture Envirofill, a Australia using Australian waste plastics loose void fi
Slide 27: Adopting AASB 16 Leases
Adopting AASB 16 Leases AASB 16 Leases became effective Impact on the profit or loss for FY21 is shown in the table below for Pro-Pac Packaging on 1 July 2019, requiring operating lease FY21 FY20 arrangements to be recognised on A$ millions Post- AASB 16 Adopt AASB 16 Pre- AASB 16 Post- AASB 16 Adop
Slide 28: Reconciliations: EBIT and EBITDA
Reconciliations Reconciliation to EBIT* & EBITDA* Reconciliation to EBIT* & EBITDA* FY21 FY20 Reconciliation to EBIT* & EBITDA* Post- Adopt Pre- Post- Adopt Pre- A$ millions FY21 16 AASB 16 AASB AASB 16 AASB 16 FY2016 AASB AASB 16 Profit before tax 11.2- Adopt Post (3.1) 14.2 Pre- 9.4- Post (2.9) Ad
Slide 29: Reconciliations: Operating Cash Flow
Reconciliations Reconciliation to Operating Cash Flow* Reconciliation to Operating Cash Flow* FY21 FY20 Post- Adopt Pre- Post- Adopt Pre- A$ millions AASB 16 AASB 16 AASB 16 AASB 16 AASB 16 AASB 16 Net cash flows from operating activities 27.4 10.5 16.9 53.4 8.5 44.9 Add: income tax paid 1.8 - 1.8 (
Slide 30: Reconciliations: Gearing
Reconciliations Reconciliation to Reconciliation toGearing* Gearing* A$ millions FY21 FY20 LTM EBITDA* (post AASB 16) 45.5 46.4 Add: unconsolidated LTM EBITDA from acquisitions - - Less: Adjustment for AASB 16 Leases (12.4) (14.0) LTM Adjusted EBITDA (pre -AASB 16)* 33.1 32.4 Borrowings 58.9 66.5 Le
Slide 31: Reconciliations: Significant Items
Reconciliations Reconciliation to Significant Items* Reconciliation of Significant Items* FY21 FY20 A$ millions Post- Adopt Pre- Post- Adopt Pre- AASB 16 AASB 16 AASB 16 AASB 16 AASB 16 AASB 16 Site consolidation and exit costs - - - 2.1 - 2.1 Acquisition and integration costs 3.7 - 3.7 2.3 - 2.3 Ch
Slide 32: Definitions of Non-IFRS Financial Measures
Definitions Adjusted EBITDA means EBITDA before AASB 16 Leases for the last 12-months, adjusted for material acquisitions or disposals Capital expenditure represents payments for property, plant and equipment, and intangible assets, less disposal proceeds of Non-IFRS EBIT refers to PBT before financ
Slide 33: For further information, please contact
For further information, please contact: Investors: Tim Welsh Chief Executive Officer & Managing Director Email: investors@ppgaust.com.au Tel: +61 3 9474 4222 Iona MacPherson Chief Financial Officer Email: investors@ppgaust.com.au Tel: +61 3 9474 4222 Media: Hayley Morris MorrisBrown Communications