Slide 1: Interim Results
Interim Results For the half year ended 29 March 2013 1
Slide 2: Agenda
AGENDA Highlights Patrick Coveney, CEO Financial Review Alan Williams, CFO Operating & Strategic Review Patrick Coveney, CEO Outlook Patrick Coveney, CEO Q&A Open to the Floor 2
Slide 3: Highlights
HIGHLIGHTS 1. Strong strategic delivery • Uniq fully integrated • US scale-up well underway • Organisation and capability enhanced 2. Double digit EPS growth in H1 13 • Resilient business and financial model • Operational and financial efficiencies delivering strong EPS growth despite volume headwin
Slide 4: Financial Review
FINANCIAL REVIEW Alan Williams Chief Financial Officer
Slide 5: Financial Summary
FINANCIAL SUMMARY H1 13 Versus H1 12 Revenue Revenue £572.9m +0.9% Operating Operating profit profit11 £33.7m +6.3% Operating Operating margin margin11 5.9% +30 bps Adjusted Adjusted PBT PBT22 £26.5m +9.9% Adjusted Adjusted earnings earnings per per share share22 6.1p +10.9% 1. Operating profit and
Slide 6: Convenience Foods
CONVENIENCE FOODS • Revenue growth significantly impacted H1 13 H1 12 % by changes in the portfolio during the period £m £m change • UK like for like revenue* was 1.3% lower mainly due to impact of horsemeat Revenue 542.1 532.6 +1.8% scandal and lower market growth rates • US revenues more than doub
Slide 7: Ingredients & Property
INGREDIENTS & PROPERTY • Decline in revenue driven by edible oils trading activity while % the molasses feed business H1 13 H1 12 % change benefitted from poor weather in £m £m change constant the period currency • Increase in operating profit due to better mix in oils and growth in Revenue 30.8 35.
Slide 8: Financing and Tax
FINANCING AND TAX Financing • Bank interest payable fell to £7.7m (H1 12: £8.1m) driven by lower effective interest rate on primary bank facilities • Net finance charge taking into account non-cash adjustments* also £7.7m (H1 12: £7.9m) Tax • Income statement effective tax rate remains very low at 1
Slide 9: Exceptional Items
EXCEPTIONAL ITEMS Income H1 13 Exceptional Items Statement £m Integration costs of UK acquisitions (2.2) Integration costs of US acquisitions (1.1) Property related charges (9.2) Pension curtailment gain 4.4 Pre tax impact (8.1) Tax relief on exceptional items and resolution of tax positions 8.6 Net
Slide 10: EPS and Dividend
EPS AND DIVIDEND EPS EPS & Dividend H1 13 H1 12 • Adjusted earnings 12.9% ahead Adjusted earnings2 £23.8m £21.1m • Adjusted earnings per share up 10.9% Denominator for earnings per 391.5m 382.3m Dividend share • 8.6% increase in interim dividend Adjusted earnings per share2 6.1p 5.5p • The Board int
Slide 11: Cashflow
CASHFLOW Lower Lower operating operating cash cash inflow inflow driven driven by by seasonal seasonal working working capital capital outflow outflow (H1 (H1 12 12 benefitted benefitted from from reductions reductions in in working working capital capital in in former former Uniq Uniq businesses) b
Slide 12: Net Debt and Leverage
NET DEBT AND LEVERAGE • Net debt at 29 March 2013 of £272.6m – equivalent to c. 2.7 times leverage for bank covenant purposes • Increase of £14.6m from 28 September 2012 driven by seasonal working capital outflow, capital expenditure and adverse FX movement of £5.0m on translation of USD denominated
Slide 13: Pensions
PENSIONS • All Group Defined Benefit pension schemes were closed to future accrual with effect from 2010 • As at 29 March 2013, IAS19 pension deficit of £126.0m, net of related deferred tax asset, an increase of £10.1m from September 2012 • Increase is due to liabilities rising more quickly than ass
Slide 14: Summary - Business Performance Goals
SUMMARY - BUSINESS PERFORMANCE GOALS • UK Chilled Convenience Foods will continue to grow Revenue ahead of overall UK Food -LFL growth of > 5% • Increasing exposure to fast growing US Convenience Channel fresh food offer • Maintain gross margin in UK and seek to absorb indirect Operating profit* cos
Slide 15: Operating & Strategic Review
OPERATING & STRATEGIC REVIEW PATRICK COVENEY CHIEF EXECUTIVE OFFICER
Slide 16: Strategic Progress in FY13
1 STRATEGIC PROGRESS IN FY13 • Evercreech refurbishment project completed with Complete Uniq transfer of premium products from Minsterley Integration • Disposal of Minsterley to Müller Dairy UK completed • Synergies fully realised Absorb • Prepared Meals manufacturing footprint reorganised Internati
Slide 17: UK Market Context
2 UK MARKET CONTEXT Household Household budgets budgets still still Retailers Retailers facing facing under under significant significant challenging challenging volume volume pressure pressure environment environment 52 w/e October 2012 26 w/e March 2013 5.0% 1.2% Chilled Convenience* Weather Weath
Slide 18: UK Convenience Performance - Tackling Market Challenges
3 UK CONVENIENCE PERFORMANCE - TACKLING MARKET CHALLENGES Challenge Greencore actions in H1 Delivering margin •• Fully Fully recovering recovering input input price price inflation inflation enhancement in low •• Driving Driving ‘Lean ‘Lean Greencore’, Greencore’, operational operational efficiencie
Slide 19: UK Convenience Performance - Food to Go
3 UK CONVENIENCE PERFORMANCE - FOOD TO GO • Broad customer, channel, capability and product mix provides resilient performance in uncertain and challenging market • Weather impacts and very tough prior year comparators slowed market growth substantially in H1** • Market growth: -0.2% c. 40% of Group
Slide 20: UK Convenience Performance - Prepared Meals
3 UK CONVENIENCE PERFORMANCE - PREPARED MEALS Prepared Meals Horsemeat scandal • Reported revenue up 10.7%, like - actions we have taken for like performance 5.9% lower* Supply Supply chain chain Sites Sites • Good growth delivered across •• Supply Supply chain chain •• Introduction Introduction of
Slide 21: UK Convenience Performance - Grocery
3 UK CONVENIENCE PERFORMANCE - GROCERY • Grocery activity focused on cooking sauces, table sauces and pickles; Frozen Foods comprised of Yorkshire puddings and toad-in- the-hole • Good business revenue growth of 4.5% versus flat cooking sauce market** • Manufacturing scale and capability underpins e
Slide 22: Greencore USA - H1 Performance
4 GREENCORE USA - H1 PERFORMANCE • US business transformed with the acquisition and successful integration of MarketFare and Schau • Reported revenues over 120% higher • Starbucks successfully launched in Boston area in January out of Newburyport and subsequently launched in Chicago, Fredericksburg
Slide 23: Greencore USA - Starbucks & 7-Eleven Store Coverage
4 GREENCORE USA - STARBUCKS & 7-ELEVEN STORE COVERAGE FOR FOOD TO GO Chicago, IL 406 stores Newburyport, MA 484 stores 233 stores Brockton, MA 268 stores Salt Lake City, UT Fredericksburg, VA 124 stores, (sauces distributed nationally) 1,187 stores Jacksonville, FL 380 stores 266 stores Stores serve
Slide 24: A Focused Growing Food to Go Leader
A FOCUSED GROWING FOOD TO GO 5 LEADER Revenue Revenue £1.2bn UKUK UK UK Prepared Prepared UK UK Grocery Grocery & & UK UK Cakes Cakes && USUS Ingredients Ingredients & & Food FoodtotoGo Go Meals Meals Frozen Frozen Foods Foods Desserts Desserts Food FoodtotoGo Go Property Property c. % of run rate r
Slide 25: Outlook
6 OUTLOOK • Market conditions expected to remain challenging in the UK • Little or no volume growth • Ready meals category still to recover fully from horsemeat scandal • Consumers under considerable financial pressure • Moderating input cost inflation • The Group remains confident in its ability to
Slide 26: Greencore
greencore bringing convenience to good food