Greif Inc. · NYSE:GEF
Greif — Investor Day (June 2016)
87 slides from Greif's investor day presentation, Jun 24, 2016
Slide 1: Greif 2016 Investor Day
Greif 2016 Investor Day June 24, 2016
Slide 2: Safety Briefing
SAFETY BRIEFING You are here Exit Exit Page 2
Slide 3: Safe Harbor
SAFE HARBOR FORWARD-LOOKING STATEMENTS • All presentations contain certain forward-looking information within the meaning of the Private Securities Litigation Reform Act of 1995. The words “may,” “will,” “expect,” “intend,” “estimate,” “anticipate,” “aspiration,” “objective,” “project,” “believe,” “
Slide 4: Summary Level Agenda
SUMMARY LEVEL AGENDA Topic Presenter Greif overview and strategy Pete Watson, President and CEO Paper Packaging & Services Tim Bergwall, Division President, PPS and Soterra Flexible Products & Services Hari Kumar, Division President, FPS Question / Answer session #1 Rigid Industrial Packaging & Serv
Slide 5: Greif overview and strategy
Greif overview and strategy Pete Watson President and Chief Executive Officer
Slide 6: Welcome and Thank You for Joining Today
WELCOME AND THANK YOU FOR JOINING TODAY OBJECTIVES FOR INVESTOR DAY: 1 Introduce Greif’s leadership team to you Provide an update on the Transformation process and confirm our 2017 2 commitments Address the questions and feedback you have about the state of our 3 business Page 6
Slide 7: Greif's Investment Thesis
GREIF’S INVESTMENT THESIS Best customer Comprehensive Share price Mitigate risk Reliable service packaging growth and through a earnings and company in provider, with substantial and diverse, global cash flow industrial leverage to the secure dividend portfolio generation packaging industrial yield1
Slide 8: A Global Leader in Industrial Packaging
A GLOBAL LEADER IN INDUSTRIAL PACKAGING Rigid Industrial Paper Packaging Flexible Products Land Packaging & & Services & Services Management Services 2015 Revenue: 2015 Revenue: 2015 Revenue: 2015 Revenue: $2,586M $676M $323M $32M Founded in 1877 - Diversified Business with a Global Platform Page 8
Slide 9: Greif's Path to Transformation
GREIF’S PATH TO TRANSFORMATION 2015 2016 2017 • Embarked on RUN RATE Transformation New direction: ($M) COMMITMENTS process • New leadership Net Sales $3,500 • Completed • Customer service portfolio review Gross Profit $720 - $730 excellence • Held Greif’s first SG&A $345 - $355 • Execution discipli
Slide 10: Greif's Vision and Strategic Priorities
GREIF’S VISION AND STRATEGIC PRIORITIES VISION: In Industrial Packaging, be the best performing customer service company in the world Engaged Delighted Profitable Three strategic priorities: Teams Customers Growth 1 Building teams aligned to value delivery Highly That drives 2 Provide a Customer ser
Slide 11: Priority One: Engaged Teams
PRIORITY ONE: ENGAGED TEAMS Gallup survey findings: Higher engagement leads to better performance1 • New leadership team Profitability • Colleague engagement Productivity • Culture of accountability with incentives aligned to value creation Customer ratings 0% 5% 10% 15% 20% 25% Engaged Delighted Pr
Slide 12: Priority Two: Customer Service Excellence
PRIORITY TWO: CUSTOMER SERVICE EXCELLENCE Greif Customer Satisfaction Index (CSI) • Performance metrics PPS o Customer Satisfaction Index FPS o Net Promoter Score RIPS 0 25 50 75 100 • Studies indicate direct correlation to an Q1 2015 Q2 2016 increase in customer loyalty to profitable Greif Global N
Slide 13: Priority Three: Transforming Performance
PRIORITY THREE: TRANSFORMING PERFORMANCE • Optimize and strengthen the portfolio • Expanding margins through fundamental operating improvements • Fiscal discipline Engaged Delighted Profitable Teams Customers Growth Page 13
Slide 14: Transforming Performance: Optimize and strengthen the portfolio
PRIORITY: TRANSFORMING PERFORMANCE Optimize and strengthen the portfolio • 22 divestitures and 13 closed operations • Targeted growth: o 21% volume growth – global Intermediate Bulk Containers (IBC)1 o 28% revenue growth – Paper Packaging specialty products1 • New facilities: o Germany IBC/reconditi
Slide 15: Transforming Performance: Expanding margins
PRIORITY: TRANSFORMING PERFORMANCE Expanding margins through fundamental operating improvements • 19.6% = Trailing four quarter gross profit margin • Disciplined execution of commercial excellence, supply chain and operational excellence • Pursuing quality of market share over quantity and enhancing
Slide 16: Transforming Performance: Fiscal discipline
PRIORITY: TRANSFORMING PERFORMANCE Fiscal discipline • 2X improvement1 in anticipated Free Cash Flow between 2015 and 2016 • $84M reduction in SG&A between 2014 and 2015, $30-$35M reduction in 2016 • Cost control mechanisms implemented for sustainability Engaged Delighted Profitable Teams Customers
Slide 17: Greif's Vision and Strategic Priorities
GREIF’S VISION AND STRATEGIC PRIORITIES VISION: In Industrial Packaging, be the best performing customer service company in the world Engaged Delighted Profitable Three strategic priorities: Teams Customers Growth 1 Building teams aligned to value delivery Highly That drives 2 Provide a Customer ser
Slide 18: Paper Packaging & Services
Paper Packaging & Services Tim Bergwall Division President
Slide 19: Paper Packaging: Unique, Sustainable Business Model
PAPER PACKAGING: UNIQUE, SUSTAINABLE BUSINESS MODEL PPS’ strategic goals: 1 Balanced growth between mills and converting operations Engaged Delighted Profitable Teams Customers Growth 2 Reshape portfolio through growth in specialty products Highly That drives 3 Expand service and customer engaged an
Slide 20: Paper Packaging: Non-conflict Partner to Corrugated Industry
PAPER PACKAGING: UNIQUE, SUSTAINABLE BUSINESS MODEL A non-conflict partner to the entire Sheet Feeder Sales corrugated packaging industry… Corrugator Plants 34% Go to Market Model Sheet Plants 66% Engaged Delighted Profitable Teams Customers Growth PPS Page 20
Slide 21: Paper Packaging: Customer Service Excellence
PAPER PACKAGING: CUSTOMER SERVICE EXCELLENCE Customer Satisfaction Index (CSI) scores 100 Target Differentiate through Reliability 75 • >96% CSI score historically 50 • Complex orders, highest quality, 25 shortest lead times on all products 0 • Customer relationships span Q1 2015 Q2 2015 Q3 2015 Q4
Slide 22: Paper Packaging: Transforming Performance, Portfolio Improvements
PAPER PACKAGING: TRANSFORMING PERFORMANCE PORTFOLIO IMPROVEMENTS = PROFITABLE GROWTH New Litho-Laminated Line New Specialty Coater New High Speed Corrugator Expanding Specialty Sales $35,000 $30,000 Sales$ (000) $25,000 $20,000 $15,000 $10,000 $5,000 Engaged Teams Delighted Customers Profitable Grow
Slide 23: Paper Packaging: Gross Margin, Structural Cost Improvements
PAPER PACKAGING: TRANSFORMING PERFORMANCE GROSS MARGIN Structural cost improvements -14% • 14% reduction in Riverville energy consumption • Riverville Mill – industry leading efficiencies Riverville has leading efficiencies • Sheet Feeders – waste down 12%; Total Efficiency1 Rankings of 138 producti
Slide 24: Paper Packaging: Fiscal Discipline
PAPER PACKAGING: TRANSFORMING PERFORMANCE FISCAL DISCIPLINE Operating Working Capital ($M)1 Apr 2015 vs. Apr 2016 • Generating cash from working capital 100 75 o Initiatives on inventory management, payment terms 50 and improving collections 25 • Over $5M reduction in discretionary 0 spend since 201
Slide 25: Paper Packaging: Key Takeaways
PAPER PACKAGING: KEY TAKEAWAYS Paper machine at Massillon, Ohio 1 Well positioned in a shifting industry 2 Providing a unique value proposition, recognized by customers New asitrade at 3 People and mindsets to drive Michigan Packaging, Michigan continuous improvement and structural cost reductions P
Slide 26: Flexible Products & Services
Flexible Products & Services Hari Kumar Division President
Slide 27: FPS: Executing Turnaround with Sense of Urgency
FPS: EXECUTING TURNAROUND WITH SENSE OF URGENCY FPS’ turnaround levers: 1 Delayer organization – closer to markets, customers and issues Engaged Delighted Profitable Teams Customers Growth 2 Fix – customized plans to fix underperforming assets and businesses Highly That drives Provide a engaged and
Slide 28: FPS: Customer Service Excellence
FPS: CUSTOMER SERVICE EXCELLENCE Customer Satisfaction Index (CSI) scores • Best practices benchmarked and training 100 Target being deployed based on case studies 75 • Actively responding to customer needs 50 o Launching new Type D anti-static product 25 0 o Infant Food Technology – Belgium site to
Slide 29: FPS: Portfolio Improvements
FPS: TRANSFORMING PERFORMANCE PORTFOLIO IMPROVEMENTS Izegem, Belgium • Five facilities closed; five non-core assets Infantile Food Technology Site divested since 2014 SITE UNDER CONSTRUCTION • Intense focus on underperforming assets o Turkey: productivity improvements o Vietnam: scale improvements o
Slide 30: FPS: Gross Margin Improvements
FPS: TRANSFORMING PERFORMANCE GROSS MARGIN IMPROVEMENTS Gross profit margin (%) • Pursuing actions to improve margin: 20 o Raw material spend – sourcing and supply chain initiatives 15 o Centralizing 3rd party sourcing for greater efficiencies 10 o Labor costs – need to generate additional efficienc
Slide 31: FPS: Fiscal Discipline
FPS: TRANSFORMING PERFORMANCE FISCAL DISCIPLINE SG&A ($M) H1 2015 vs. H1 2016 35 30 • 360 basis point improvement in SG&A 25 as a percentage of sales compared to 20 15 previous year 10 5 • Optimizing inventory in Turkey, 0 Benelux, Germany and France H1 2015 H1 2016 Operating Working Capital ($M)1 A
Slide 32: FPS: Key Takeaways
FPS: KEY TAKEAWAYS Shop floor - Samandira, Turkey To date, we have not delivered value. What is different going forward? 1 Fix is being internally led; not by consultants 2 Leveraging legacy leadership – deep 3 layer PE Extrusion - Hadimkoy, Turkey experience with local markets 3 Utilizing lessons l
Slide 33: Question and Answer Session One
Question and Answer Session One
Slide 34: Rigid Industrial Packaging & Services - EMEA
Rigid Industrial Packaging & Services - Europe, Middle East and Africa Michael Cronin Group President
Slide 35: RIPS EMEA: Strategy from the Market Back
RIPS EMEA: STRATEGY FROM THE MARKET BACK RIPS EMEA’s focus: 1 Market economics and competitive positioning – driving strategy and direction Engaged Delighted Profitable Teams Customers Growth 2 Customer needs and building competitive advantage – driving decision making Highly That drives Provide a e
Slide 36: RIPS EMEA: Post Strategic Realignment in Europe
RIPS EMEA: POST STRATEGIC REALIGNMENT IN EUROPE All supported by a revised, flatter, stronger organization Western Europe Central Europe Southern Europe Different priorities, Organizational delayering Integration and Attractive growth but one goal – stronger and addressing product/price mix value cr
Slide 37: RIPS EMEA: Customer Service Excellence
RIPS EMEA: CUSTOMER SERVICE EXCELLENCE Customer Satisfaction Index (CSI) scores 100 Target • CSI measured and reported monthly 75 • Quality council measuring and driving quality 50 • Regular assessment of sales force with an emphasis on value selling 25 0 • Pocket Margin analysis guiding pricing and
Slide 38: RIPS EMEA: Portfolio Improvements
RIPS EMEA: TRANSFORMING PERFORMANCE PORTFOLIO IMPROVEMENTS • Seven underperforming or non-strategic Intermediate Bulk Container volumes assets closed or divested since 2014 (000 units sold) o Focus on sub-performing plants • Profit pool analysis being conducted to identify attractive markets o IBC g
Slide 39: RIPS EMEA: Gross Margin Improvements
RIPS EMEA: TRANSFORMING PERFORMANCE GROSS MARGIN IMPROVEMENTS Gross profit margin (%) • Operating cost reduction plan initiated 20 • Extended value stream mapping 15 • Pursuing supply chain optimization – regional system view 10 • Emphasis on better product mix and 5 product management 0 Q1 2015 Q2
Slide 40: RIPS EMEA: Supply Chain Optimization
RIPS EMEA: TRANSFORMING PERFORMANCE SUPPLY CHAIN OPTIMIZATION Generate Forecasts S&OP Demand Meeting Planning Pre-S&OP Supply Meeting Planning Central Inventory Control Sales & Operations Planning Network Optimization • Reduced & shared inventory • Improved forecast • Better plant utilization • Regi
Slide 41: RIPS EMEA: Fiscal Discipline
RIPS EMEA: TRANSFORMING PERFORMANCE FISCAL DISCIPLINE • Pricing and payment terms policy in place with clear responsibility level • Focused coordination between sales and operations on margin and working capital • Leveraging best in class operating working capital (OWC) management ⎼ Some businesses
Slide 42: RIPS EMEA: Key Takeaways
RIPS EMEA: KEY TAKEAWAYS Jubail, Saudi Arabia steel drum plant 1 Fact-based market-based strategy and business planning 2 New and upgraded organization 3 Best-in-class operations with fiscal discipline Mendig, Germany IBC reconditioning plant 4 Aggregated segment business unit supply chain mapping R
Slide 43: Rigid Industrial Packaging & Services - Asia Pacific
Rigid Industrial Packaging & Services – Asia Pacific (APAC) Chester Tsai Division President
Slide 44: RIPS APAC: Expanding Market Presence and Margin
RIPS APAC: EXPANDING MARKET PRESENCE AND MARGIN RIPS APAC’s strategic goals: 1 Align team to customer service excellence and value Engaged Delighted Profitable Teams Customers Growth 2 Penetrate the IBC market and expand plastic footprint in South East Asia Highly That drives Provide a Growing walle
Slide 45: RIPS APAC: Customer Service Excellence
RIPS APAC: CUSTOMER SERVICE EXCELLENCE Customer Satisfaction Index (CSI) scores • 32% improvement in China’s customer 100 Target satisfaction index scores driving APAC improvement – better linkage between 75 sales and operations 50 • Sales Incentive Plan installed – greater focus on customer satisfa
Slide 46: RIPS APAC: Portfolio Improvements
RIPS APAC: TRANSFORMING PERFORMANCE PORTFOLIO IMPROVEMENTS Intermediate Bulk Container volumes (000 units sold) • Expanding IBC footprint • Increasing plastic capacity • Capacity optimization Q1 2015 Q2 2015 Q3 2015 Q4 2015 Q1 2016 Q2 2016 Engaged Delighted Profitable Teams Customers Growth RIPS - A
Slide 47: RIPS APAC: Gross Margin Improvements and Fiscal Discipline
RIPS APAC: TRANSFORMING PERFORMANCE GROSS MARGIN IMPROVEMENTS AND FISCAL DISCIPLINE Gross profit margin (%) • Fixed underperforming operations 25 • Rationalized customer mix 20 • Sales and operation planning integration 15 • Stabilizing sourcing 10 • Improving working capital 5 0 Q1 2015 Q2 2015 Q3
Slide 48: APAC: Key Takeaways
APAC: KEY TAKEAWAYS APAC team and customers in hygiene gear (global food safety initiative facility) 1 Controlling what we can control – starts with discipline 2 Customer satisfaction – delighting customers 3 Profitable growth – expanding reach Dual head blow molding machine - Singapore 4 People – t
Slide 49: Rigid Industrial Packaging & Services - Americas
Rigid Industrial Packaging & Services - Americas Ole Rosgaard Division President
Slide 50: RIPS Americas: Focused on Improving Fundamentals
RIPS AMERICAS: FOCUSED ON IMPROVING FUNDAMENTALS RIPS America’s strategic goals: 1 Increase Customer Satisfaction Index Engaged Delighted Profitable Teams Customers Growth 2 Outpace market in profitable growth Highly That drives Provide a engaged and loyalty, growth differentiated 3 Reduce unplanned
Slide 51: RIPS Americas: Customer Service Excellence
RIPS AMERICAS: CUSTOMER SERVICE EXCELLENCE Customer Satisfaction Index (CSI) scores 100 Target 75 • 30% reduction in corrective action rate 50 • 510 online customer service training 25 sessions held for inside sales 0 • 57% improvement in customer contacts Q1 2015 Q2 2015 Q3 2015 Q4 2015 Q1 2016 Q2
Slide 52: RIPS Americas: Portfolio Improvements
RIPS AMERICAS: TRANSFORMING PERFORMANCE PORTFOLIO IMPROVEMENTS Intermediate Bulk Container volumes (000 units sold) • Three steel plants closed and seven non-core assets divested since 2014 • Leveraging favorable customer relationships to drive profitable IBC growth Engaged Delighted Profitable Q1 2
Slide 53: RIPS Americas: Gross Margin Improvements
RIPS AMERICAS: TRANSFORMING PERFORMANCE GROSS MARGIN IMPROVEMENTS North America gross profit margin (%) • Implemented price and product mix 25 management 20 15 10 • 10.5% reduction in unplanned downtime since 5 2015 0 Q1 2015 Q2 2015 Q3 2015 Q4 2015 Q1 2016 Q2 2016 • Simplified SKU offering • Variab
Slide 54: RIPS Americas: Fiscal Discipline
RIPS AMERICAS: TRANSFORMING PERFORMANCE FISCAL DISCIPLINE Operating Working Capital ($M)1 Apr 2015 vs. Apr 2016 • Emphasis on generating cash from working 200 capital 150 o Accomplished: 19 day payment 100 improvement on 228 suppliers 50 o Targeting: 30% improvement on days 0 sales outstanding Apr-1
Slide 55: RIPS Americas: Key Takeaways
RIPS AMERICAS: KEY TAKEAWAYS New clean filling room, Baytown, TX plant 1 Business fundamentals are much healthier and on a path to be best in class 2 Improving and sustainable profit performance and cash flow generation 3 Volume growth in plastic and IBCs Greif colleague at Bradley, IL plastic plant
Slide 56: Financial review
Financial review Larry Hilsheimer Executive Vice President and Chief Financial Officer
Slide 57: Upgraded the Corporate Finance Team and Enhancing Systems
UPGRADED THE CORPORATE FINANCE TEAM AND ENHANCING SYSTEMS Transformation meetings, 2016 • Upgraded talent across multiple functions, particularly financial reporting team • Implemented more rigorous review processes and centralized cost controls • Improving systems and controls Engaged Delighted Pro
Slide 58: SG&A Reduced by 20% Since 2013
SG&A REDUCED BY 20% SINCE 2013 Annual SG&A expense ($M) $600 • Sustainable SG&A reductions implemented $500 • Additional, but smaller, opportunities exist $400 • Improved culture of accountability $300 $200 $100 $0 2013 2014 2015 2016 Engaged Teams Delighted Customers Profitable Growth outlook Page
Slide 59: Manageable Debt Profile
MANAGEABLE DEBT PROFILE Debt profile ($M) at April 30, 2016 • Total debt of $1.1B as of Q2 2016 ‒ Leverage ratio of 2.6 of Q2 2016 $600 ‒ Target leverage ratio of 2.0 – 2.5X coming out of 2017 $500 • Declining debt profile $400 ‒ $300M in senior notes due in 2017; exploring multiple refinancing opti
Slide 60: Tracking to 2017 Transformation Commitments
TRACKING TO 2017 TRANSFORMATION COMMITMENTS Greif 2014 and 2017 financial ratios 2014 Actual 2017 Gross Profit 19.1% 20.0% SG&A 11.7% 10.0% Operating Profit 7.5% 10.0% before Special Items1 Operating Working Capital2 9.7% < 7.5% Greif’s trailing four quarter gross margin percentage = 19.6% Engaged D
Slide 61: Tracking to 2017 Transformation Commitments
TRACKING TO 2017 TRANSFORMATION COMMITMENTS Greif 2017 consolidated Transformation commitments 2017 run rate commitments: 2017 run rate commitments: ($M) June 10, 2015 June 24, 2016 Net Sales $3,831 $3,500 Gross Profit $760 – $770 $720 – $730 SG&A $375 – $385 $345 – $355 Operating Profit $375 – $395
Slide 62: Paper Packaging & Services: 2017 Transformation Commitments
PAPER PACKAGING & SERVICES: 2017 TRANSFORMATION COMMITMENTS 2017 run rate 2017 run rate ($M) commitments: commitments: Trends June 10, 2015 June 24, 2016 Net Sales $887 $640 Weaker containerboard pricing and higher fiber Gross Profit $195 – $205 $152 – $162 costs year to date SG&A $50 – $55 $46 – $5
Slide 63: Flexible Products & Services: 2017 Transformation Commitments
FLEXIBLE PRODUCTS & SERVICES: 2017 TRANSFORMATION COMMITMENTS 2017 run rate 2017 run rate ($M) commitments: commitments: Trends June 10, 2015 June 24, 2016 Net Sales $315 $290 Instilling a sense of Gross Profit $55 – $65 $43 – $53 urgency to fix underperforming SG&A $45 – $50 $38 – $43 operations Op
Slide 64: Rigid Industrial Packaging & Services: 2017 Transformation Commitments
RIGID INDUSTRIAL PACKAGING & SERVICES: 2017 TRANSFORMATION COMMITMENTS 2017 run rate 2017 run rate ($M) commitments: commitments: Trends June 10, 2015 June 24, 2016 Net Sales $2,605 $2,544 Accelerating gross profit Gross Profit $495 – $505 $506 – $516 improvement SG&A $280 – $285 $256 – $261 Focused
Slide 65: Land Management: 2017 Transformation Commitments
LAND MANAGEMENT: 2017 TRANSFORMATION COMMITMENTS 2017 run rate 2017 run rate ($M) commitments: commitments: Trends June 10, 2015 June 24, 2016 Net Sales $24 $26 Steady performance Gross Profit $5 – $15 $4 – $14 SG&A $0 – $5 $0 – $5 Operating Profit $5 – $10 $4 – $9 before Special Items1 Engaged Deli
Slide 66: Tracking to 2017 Transformation Commitments
TRACKING TO 2017 TRANSFORMATION COMMITMENTS Greif 2017 consolidated Transformation commitments 2017 run rate commitments: 2017 run rate commitments: ($M) June 10, 2015 June 24, 2016 Net Sales $3,831 $3,500 Gross Profit $760 – $770 $720 – $730 SG&A $375 – $385 $345 – $355 Operating Profit $375 – $395
Slide 67: Question and Answer Session Two
Question and Answer Session Two
Slide 68: Greif's Vision and Strategic Priorities
GREIF’S VISION AND STRATEGIC PRIORITIES VISION: In Industrial Packaging, be the best performing customer service company in the world Engaged Delighted Profitable Three strategic priorities: Teams Customers Growth 1 Building teams aligned to value delivery Highly That drives 2 Provide a Customer ser
Slide 69: Greif's Investment Thesis
GREIF’S INVESTMENT THESIS Best customer Comprehensive Share price Mitigate risk Reliable service packaging growth and through a earnings and company in provider, with substantial and diverse, global cash flow industrial leverage to the secure dividend portfolio generation packaging industrial yield1
Slide 70: Appendix
GREIF Appendix
Slide 71: RIPS Americas: Facilities Located Across Two Continents
RIPS AMERICAS: 72 FACILTIES LOCATED ACROSS TWO CONTINENTS RIPS NA: Key end markets (by revenue) Industrial Chemicals Other Food & Beverage Lubricants Specialty Chemicals Agro-Chemicals Paints & Coatings Pharmaceuticals Oil & Gas Flavors and Fragrances RIPS NA: Key products (by revenue) Steel Plastic
Slide 72: RIPS N. America: Improving Fundamentals and Heightening Standards
RIPS N. AMERICA: IMPROVING FUNDAMENTALS AND HEIGHTENING STANDARDS RIPS NA Customer Service Index RIPS NA (CSI) up 14.1% Customer Complaints Down 40% 2015A 2016A 2015 2016 Q1- Q2- Nov Dec Jan Feb Mar Apr May RIPS NA RIPS NA Gross Margin percentage up 5% Unplanned Downtime reduced 10.5% 2015A 2016A Q1
Slide 73: RIPS EMEA: Global Reach and Scale
RIPS EMEA: GLOBAL REACH AND SCALE RIPS EMEA: Key end markets (by revenue) Petrol Prod, Lube Oils&Adds Bulk/Commodity Chemicals Solid Food Prod,Pastes&Ed oils Specialty Chemicals Paints,Coatings,Inks,Adhesives Blenders,fillers & chem distr. Packaging Distributors Silicones Flavours & fragrances Other
Slide 74: APAC: Expanding Reach Across Countries and Products
APAC: EXPANDING REACH ACROSS COUNTRIES AND PRODUCTS RIPS APAC: Key end markets (by revenue) Bulk/Commodity Chemicals Agro chemicals Specialty chemicals Blenders,fillers & chem distr. Detergents, surfactants Paints,coatings,inks,adhesives Flavors and fragrances Solid food products Solvents & glycol-b
Slide 75: Paper Packaging: Newer Network, Solid Returns
PAPER PACKAGING: NEWER NETWORK, SOLID RETURNS PPS: Key products (by revenue) Mills Sheet Box Board Corrugated Containerboard Sheet Mills Feeders Since 2009, PPS has invested over $200M in our 7 operations Page 75
Slide 76: 2017 Commitment Assumptions
2017 COMMITMENT ASSUMPTIONS • Assumed market growth rate of 0-1% • Raw material costs assumed flat against current indices in the markets in which we participate • Major raw material price increases are passed to customers through price adjustment mechanisms in contracts or otherwise with customary
Slide 77: Management Team Biographies
MANAGEMENT TEAM BIOGRAPHIES Peter G. Watson Peter G. Watson was named Greif’s President and Chief Executive Officer on November 1, 2015 after previously serving as Chief Operating Officer. Since joining Greif in 1999, Pete has served in a variety of positions, including Group President for Paper Pac
Slide 78: Management Team Biographies
MANAGEMENT TEAM BIOGRAPHIES Michael Cronin Group President, RIPS EMEA, APAC • 40 years’ experience • Former President of a European Packaging Company • Former CEO of global flexible packaging company Ole Rosgaard Division President, RIPS Americas • 25 years’ experience • Worked internationally in 9
Slide 79: Executive Compensation Tied to Shareholder Returns
EXECUTIVE COMPENSATION TIED TO SHAREHOLDER RETURNS CEO compensation mix Named executive officer mix Incentive plans • Short term incentive is based on Return on Net Assets 19% 44% • Long term incentive considers 33% three year performance periods 61% 20% and is based on EBITDA Insider purchasing 23%
Slide 80: YTD GAAP to Non-GAAP Reconciliation Excluding Divestitures
YTD GAAP TO NON-GAAP RECONCILIATION OF SELECTED FINANCIAL INFORMATION EXCLUDING THE IMPACT OF DIVESTITURES (Dollars in Millions) Thre e m onths e nde d Tw e lve m onths e nde d Octobe r 31 Octobe r 31 2015 2014 2015 2014 Ope rating profit (los s ): Rigid Industrial Packaging & Services $ 10.9 $ 46.7
Slide 81: OWC as a Percentage of Fiscal 2014 Net Sales
OWC AS A PERCENTAGE OF FISCAL 2014 NET SALES (Dollars in Millions) FY 2014 Trade accounts receivable $ 501 Inventories $ 381 Accounts Payable $ (471) $ 411 Net Sales $ 4,239.1 OWC as % of Net Sales 9.7% Page 81
Slide 82: Trailing Four Quarter Margins
TRAILING FOUR QUARTER: GROSS PROFIT MARGIN, SG&A RATIO AND OPERATING PROFIT BEFORE SPECIAL ITEM MARGIN (Dollars in Millions) Q2 2016 Q1 2016 Q4 2015 Q3 2015 TTM $ % $ % $ % $ % $ % Net Sales 839.6 771.4 868.5 930.0 3,409.5 Gross Profit 173.7 20.7% 151.3 19.6% 168.0 19.3% 166.8 17.9% 659.8 19.4% Vene
Slide 83: Operating Working Capital
OPERATING WORKING CAPITAL (Dollars in Millions) RIPS Americas PPS FPS April 30, 2016 April 30, 2015 April 30, 2016 April 30, 2015 April 30, 2016 April 30, 2015 Accounts Receivable 138.4 170.2 71.6 75.3 48.9 52.5 plus: Inventory 72.8 112.1 49.8 53.1 53.2 72.5 minus: Accounts Payable 78.0 99.5 45.3 42
Slide 84: Note on Forward Looking Statements
NOTE ON FORWARD LOOKING STATEMENTS • With respect to all forward looking non-GAAP measures including Operating Profit Before Special Items and Free Cash Flow, no reconciliation is included in this presentation because, due to the high variability and difficulty in making accurate forecasts and proje
Slide 85: Key Definitions
KEY DEFINITIONS • Customer Satisfaction Index: Customer Satisfaction Index is an internal measure of a plants or businesses performance against selected parameters that customers experience, giving us an indication of our level of meeting our customers basic needs. Components include: customer compl
Slide 86: RIPS Is a Demonstrated Market Leader
RIPS IS A DEMONSTRATED MARKET LEADER Steel Fibre Plastic Rigid Pkg. Filling & Blending IBC Recon. #1 #1 #2 #4 #1 #3 Page 86
Slide 87: Greif
GREIF