Slide 1: 2016 Final Results & Strategy Update
2016 Final Results & Strategy Update
Slide 2: Agenda
Agenda 1. Overview 2. Summary 2016 results 3. Strategic review: - Markets - Technology - Business review - New organisation - Key short-term objectives 4. Outlook 5. Appendices Molins PLC 2016 Final Results & Strategy Update 2
Slide 3: Overview - Review
Overview - Review > Comprehensive review of business confirms robust fundamental strengths: ⁻ leader of innovative high speed packaging & instrumentation solutions ⁻ growing service revenues and trend towards contracted support demonstrate significant opportunity ⁻ customer move to contracted not ad
Slide 4: Summary 2016 Results
Summary 2016 Results David Cowen – Group Finance Director Molins PLC 2016 Final Results & Strategy Update 4
Slide 5: Overview – 2016 Financial Highlights
Overview – 2016 Financial Highlights > Growth in orders from packaging and services, offsetting decline in nicotine markets > Significantly higher order book at year end > Strong cash generation following £4.8m reduction in working capital > Net cash £0.8 million vs net debt of £3.2m previous year >
Slide 6: 2016 Group Performance
2016 Group Performance Financial bridge on revenue Financial bridge on underlying operating profit £m's £m's 100.0 5.0 90.0 4.5 80.0 4.0 70.0 3.5 60.0 3.0 50.0 2.5 40.0 2.0 30.0 1.5 20.0 1.0 10.0 0.5 0.0 0.0 2015 I&TM Packaging 2016 2015 I&TM Packaging 2016 machinery machinery Financial bridge on ne
Slide 7: Strategic Review 'One Molins' 2021 vision
Strategic Review ‘One Molins’ 2021 vision Tony Steels – Chief Executive Molins PLC 2016 Final Results & Strategy Update 7
Slide 8: Mission
Mission > To be a global leader of high speed packaging solutions focused on attractive growth markets enhanced by a world class service offer programme to ensure customers achieve maximum return on their investments > Customer focused, responsive and flexible through operational excellence underpin
Slide 9: Addressable Growth Markets
Addressable Growth Markets SECTOR SOLUTIONS MARKET VALUE CAGR DRIVERS Pharmaceutical • Dry Powder Inhaler 4.9% • First of a Kind • Test and Measurement Premiumization Recyling $29 billion* Healthcare • Ostomy • Contact Lens • Personal Care 5.3% Increasing Health income Food and • Bakery beverage • C
Slide 10: Application Know-How
Application Know-How Process Shipping Primary Packaging Secondary Packaging Raw Primary Infeeds & Case Processing Dosing Palletizing Logistics material packaging Cartoning packing Service offer Molins Technologies Langen Group Molins Machinery Cerulean Service offer Over 100 qualified engineers, rep
Slide 11: Returns From Innovation – Case Studies
Returns From Innovation – Case Studies Global pharmaceuticals manufacturing company Leading nutrition and beverages business > Challenge > Challenge To develop a new process for precision dosing, Reduce damage from packing coffee sticks into bags filling, and sealing; improve dose accuracy; reduce o
Slide 12: Business Review – Top Line Conclusions
Business Review – Top Line Conclusions Issues Opportunities • Large competitors offer full • Complete scope of applications solution Market environment • Extensive range of engineering • European centric competences across scope of • Exposure to too few large applications customers • Focused on attr
Slide 13: Strategic Priorities
Strategic Priorities DURING 2017 FUTURE PLANS • Commercial excellence programme • Full solution selling • Regional sales structure • Product Development Roadmap Going for Growth • Cross selling • Key account development • Key account management • Create Services business • Life cycle ROI proposition
Slide 14: The Journey
The Journey • New organisation • Right-size • Product roadmap • Centralised services One Molins & cost • “Commercial excellence” reductions • World class service offer • Leverage capabilities • Developing people Leverage commonalities • Modularisation • Build “full • Cross selling solution” • Broade
Slide 15: New Organisation Structure
New Organisation Structure • Experienced and regionally embedded management team – supplemented by new hires in Service and HR AMERICAS EMEA ASIA Regional Sales & Service Product Operations Steve Frankham management R&D Operations Supply Chain Services Global business New recruit services business G
Slide 16: Immediate Self-Help Initiatives
Immediate Self-Help Initiatives Actions to date Next steps > Strategic review completed with engaged > Appointment of global service head and HR senior leaders director > Efficiency improvement through > Management incentivisation arrangements > Cost reductions focused on order intake and margins >
Slide 17: Outcome
Outcome Global leader in “Make, Pack, Test, Service” high-speed packaging solutions GROWTH SERVICE AS A OPERATIONAL BUSINESS EFFICIENCY Improved Improved Improved returns customer operational and cash performance performance generation Transforming our business performance - cultural, commercial, op
Slide 18: Appendices
Appendices > Detailed results > What we do > International management team Molins PLC 2016 Final Results & Strategy Update 18
Slide 19: Income Statement
Income Statement 2016 2015 £m £m Sales 80.1 87.0 > Reduction in sales in Packaging Machinery from delayed Underlying operating profit* 1.1 4.0 orders Non-underlying items (1.8) (1.1) > Lower performance in Packaging Machinery from lower sales and under-utilised operations Operating (loss)/profit (0.
Slide 20: Cash Flows
Cash Flows 2016 2015 £m £m Cash flows from operating activities 6.2 3.6 > Cash flows from operating activities include: Cash flows from investing activities (2.0) (2.7) > £4.1m cash profit Cash flows from financing activities (0.8) (1.5) > £4.8m working capital decrease > £2.0m pension deficit payme
Slide 21: Working Capital
Working Capital 2016 2015 £m £m Inventories decrease 3.5 2.2 Receivables (increase)/decrease (4.2) 6.4 Payables increase/(decrease) 5.6 (8.1) Provisions decrease (0.1) (0.1) Net working capital decrease 4.8 0.4 Molins PLC 2016 Final Results & Strategy Update 21
Slide 22: Balance Sheet
Balance Sheet 2016 2015 Net assets £m £m Intangible Goodwill 7.8 7.4 > Goodwill at December 2016 relates to Cerulean assets: Product development & 7.4 7.5 > Property, plant and equipment includes £0.8m of other intangibles investment property Property, plant & equipment 9.3 8.8 > Tax balance include
Slide 23: Pensions
Pensions 2016 2015 £m £m Value of assets UK 401.9 346.9 > Accounting valuation of the UK scheme reduced due to 17.1 14.9 lower interest rates, partly offset by strong asset US performance Total 419.0 361.8 > Funding of UK scheme at £1.8m (+2.1%) per annum (17 Net surplus/(deficit) UK 4.6 10.6 year r
Slide 24: What We Do
What We Do Packaging Machinery Molins Technologies > Innovative and first of a kind process and packaging applications > Technical consultancy and service solutions > Supports customer new product introduction > Improves competitiveness of existing customer products Langen > High speed packaging sol
Slide 25: What We Do
What We Do Instrumentation & Tobacco Machinery Cerulean > Develops, manufactures and services, quality control and analysis solutions > Focus on regulatory environments Molins Tobacco Machinery > Designs, manufactures and services secondary tobacco processing and packaging machinery > Application st
Slide 26: International Management Team
International Management Team Tony Steels David Cowen Steve Frankham Dan Murthi Richard Yu Jose Cornejo Chief Executive Group Finance Director Global Operations & Global Commercial Director Director Asia Director Americas BD Director & Director EMEA Previous Experience: Time Spent at Time Spent at T
Slide 27: Disclaimer
Disclaimer This presentation is being made only to and directed at: (a) events and circumstances that are beyond the control of persons who have professional experience in matters Molins, including amongst other things, Molins’ future relating to investments falling within Article 19 of the profitab