Slide 1: Q2 & H1 2022 Results
Q2 & H1 2022 RESULTS WEBCAST July 29, 2022 2022 H1 & Q2 Results - July 29, 2022 1
Slide 2: Disclaimer
DISCLAIMER Forward-looking statements Accounting changes This presentation may include forward-looking statements. Forward-looking As from 2022, the Emerging Markets, statements are statements regarding or based upon our management’s which represented 30% of revenue in current intentions, beliefs or
Slide 3: Business Review
Q2 & H1 2022 RESULTS BUSINESS REVIEW Esther Berrozpe, CEO 2022 H1 & Q2 Results - July 29, 2022 3
Slide 4: Strategic turnaround under way
STRATEGIC TURNAROUND UNDER WAY While managing a challenging external environment Volume growth & Cost inflation, Portfolio milestone cost reduction partly offset by reached with creating underlying pricing, with divestment of value additional pricing Mexican business planned 7% 4% €180M 8% €285M €25
Slide 5: H1 Key Figures
H1 KEY FIGURES Revenue turn-around Revenue Adj. EBITDA margin Cash Total Group Total Group Total Group Net debt €1,152M 4.3% €(826)M +15% LFL vs H1 21 -6.0pp vs H1 21 vs €(726)M at end of Dec 21 Core Markets Core Markets Leverage €781M 5.1% 6.8X +12% LFL vs H1 21 -7.2pp vs H1 21 vs 4.2x at end of De
Slide 6: Turnaround confirmed since 2021
TURNAROUND CONFIRMED SINCE 2021 Back to net revenue growth in 2022 Revenue (in €M) 700 Total H1 2022 delivers highest H1 revenue since 2017 600 Group Built on 5 quarters of sequential growth 500 400 Last-twelve-month average consistently positive since 2022 Core Markets 300 200 Emerging Tota
Slide 7: 7% volume/mix revenue growth in H1
7% VOLUME/MIX REVENUE GROWTH IN H1 Outperforming growing market with focus on strategic drivers YoY volume/mix impact on revenue Volume/mix up double +10% North digit in H1 Retailer brands LTM average America Contract wins in previous gaining market +8% quarters dropping through share in baby
Slide 8: €36M cost reduction delivery in H1
€36M COST REDUCTION DELIVERY IN H1 Delivering consistent run rate of ~4% of cost base [1] Gross savings and SG&A 16% Operating savings of €37M 14% €29M savings in Core Markets SG&A / sales Mayen production plant closed in April 12% 10% in H1 Scrap rate and OEE further improved compared to Co
Slide 9: Inflationary environment increased further
INFLATIONARY ENVIRONMENT INCREASED FURTHER Early signs of stabilization Main raw material indices 3,000 +0-30% Overall cost base up ~20% YoY +40-80% +7% 2,500 +81% Raw material prices up ~30% YoY +31% Main impact from price increase on SAP and non-woven materials 2,000 +63% +1% Index increas
Slide 10: Ramping up pricing momentum
RAMPING UP PRICING MOMENTUM Core Markets catching up YoY price increase +12% 8% higher prices in total Group in H1 +10% +10% Strong delivery in discontinued Emerging Markets with double digits in own brands +8% Evolving from +7% in Q1 to +10% in Q2 +7% +6% +5% +4% 4% higher prices in Core Ma
Slide 11: Inflation offsets underlying value creation
INFLATION OFFSETS UNDERLYING VALUE CREATION Showing signs of stabilization Underlying Net cost Net EBITDA impact value creation inflation impact 60 60 60 YoY impact on adj. EBITDA (in €M) YoY impact on adj. EBITDA (in €M) YoY impact on adj. EBITDA (in €M) Net cost inflation Operating & SG&A savings
Slide 12: Financial Review
Q2 & H1 2022 RESULTS FINANCIAL REVIEW Peter Vanneste, CFO 2022 H1 & Q2 Results - July 29, 2022 12
Slide 13: Q2 Key Figures
Q2 KEY FIGURES Double digit revenue growth confirmed Revenue Adj. EBITDA margin Debt Total Group Total Group Total Group Net debt €598M 4.1% €(826)M +15% LFL YoY -6.1pp YoY vs €(833)M +8% QoQ -0.3pp QoQ at end of March 22 Core Markets Core Markets Leverage €396M 4.8% 6.8X +10% LFL YoY -7.8pp YoY vs
Slide 14: Revenue growth continued
Continuing operations REVENUE GROWTH CONTINUED Based equally on volumes and pricing benefits Q2 Revenue for Core Markets (in €M) 500 5% volume and mix growth 396 across categories 383 +4% +14% Result of contract gains 400 +5% +10% +5% 347 Retail brands gaining share Forex Price Solid demand
Slide 15: Solid growth & savings offset by inflation
Continuing operations SOLID GROWTH & SAVINGS OFFSET BY INFLATION Resulting in EBITDA decrease Q2 Adj. EBITDA for Core Markets (in €M) 100 Strong €49M YoY profit delivery from revenue growth and cost savings 80 +19 -57 Consistent contribution of cost reduction +14 measures at >4% of cost base 60
Slide 16: Non-cash impairments impact EPS
NON-CASH IMPAIRMENTS IMPACT EPS Leading to Basic EPS of €(2.08) H1 EPS (in €M) 1.0 Adj. EPS from cont. ops. at €(0.14) Net financial costs at €(22)M in line with H1 2021 0.5 0.27 -0.56 Positive tax impact (0.14) (2.08) Non-recurring costs at €(90)M 0.0 +0.17 -0.02 -1.08 Adj. EPS €(6)M cash
Slide 17: Investment in WC and capex impact FCF
INVESTMENT IN WC AND CAPEX IMPACT FCF Leading to FCF of €(59)M H1 22 EBITDA to FCF (in €M) 80 Capex slightly up at €27M vs €23M in H1 21 Discipline maintained with capex/revenue at 2.3%, 60 49 -22 optimizing spend efficiency 10 Expected to increase in H2 40 disc. ops. -39 Capex/depreciation
Slide 18: Net debt up YTD, but improving vs March
NET DEBT UP YTD, BUT IMPROVING VS MARCH Leverage up mainly due to lower EBITDA Net debt evolution (in €M) YtD Debt bridge (in €M) (1,200) 12x 181 (1,007) (1,000) 10x (833) (826) -15 (826) Other debt -27 -59 (800) (725) 8x (725) (220) Term loan Other [2] Cash Net Floating rate 6.8x FCF financia
Slide 19: Milestone in portfolio transformation
Discontinued operations MILESTONE IN PORTFOLIO TRANSFORMATION Divestment of Mexican business agreed Agreement reached to divest Mexican branded business Core Markets to Softys, subsidiary of Empresas CMPC Includes Puebla plant, Mexican and related export business Excludes Tijuana plant and Nor
Slide 20: Going Forward
Q2 & H1 2022 RESULTS GOING FORWARD Esther Berrozpe, CEO 2022 H1 & Q2 Results - July 29, 2022 20
Slide 21: 2022 Outlook
2022 OUTLOOK H2 revenue and EBITDA margin to increase progressively Visibility remains low Core Markets Group (incl. disc. ops.) Uncertain geo-political Revenue growth ≥ 10% LFL Revenue growth ≥ 10% LFL environment Persisting volatile inflationary macro-economic situation With positive m
Slide 22: Key priorities
KEY PRIORITIES Continuous delivery on Progress on savings divestments Further Restore pricing margins 2022 H1 & Q2 Results - July 29, 2022 22
Slide 23: Q&A
Q2 & H1 2022 RESULTS Q&A 2022 H1 & Q2 Results - July 29, 2022 23
Slide 24: Thank you
Q2 & H1 2022 RESULTS THANK YOU 2022 H1 & Q2 Results - July 29, 2022 24