Slide 1: Ansell Limited Half Year Results 31st December 2010
For personal use only Ansell Limited Half Year Results 31st December 2010 Magnus Nicolin – Chief Executive Officer Rustom Jilla – Chief Financial Officer
Slide 2: F'11 H1 - Agenda
F’11 H1 - Agenda For personal use only Business Overview - Magnus Nicolin Financial Report - Rustom Jilla Full Year Outlook - Magnus Nicolin US dollars used in all slides unless otherwise specified 2
Slide 3: Business Overview
For personal use only Business Overview Magnus Nicolin Chief Executive Officer 3
Slide 4: A Challenging Environment
F’11 H1 – A Challenging Environment For personal use only The trading environment and massive efforts to revitalise the company made for a challenging first half Dramatic cost increase in some key raw materials: Natural Rubber Latex (NRL) up 75% and Cotton up 165% vs. prior period Sales and profits
Slide 5: Strong Top and Bottom Line Results
F’11 H1 – Strong Top and Bottom Line Results For personal use only F’10 H1 F’11 H1 % Change Sales ($M) 533.3 583.7 +9% EBIT ($M) 65.6 69.3 + 6% PA ($M) 54.3 61.0 +12% EPS (US¢) 40.3 46.0 +14% 5
Slide 6: The Half in Brief
F’11 H1 – The Half in Brief For personal use only Positives Negatives Double digit organic sales growth, NRL and certain other raw material excluding FX movements cost increases Outstanding Industrial business Slow progress on reshaping some results worldwide core processes such as Sales & Pickup in
Slide 7: Ansell's Strategies for Accelerated Growth
F’11 H1 - Ansell’s 7 Strategies for Accelerated Growth For personal use only 1. Focus around 4 Global Business Units (GBU’s) Within targeted defined Verticals and geographies based on clear attractiveness criteria 2. Change structure to a matrix with well defined roles Crystal clear decision rights
Slide 8: Key GBU responsibilities
F’11 H1 – Key GBU responsibilities For personal use only 1. Select and execute core initiatives for growth Select the right verticals and geographies and ensure focused execution Select key existing and new technologies to drive growth 2. Simplify offering to improve margins Standardise brands and r
Slide 9: Revitalisation on Track
F’11 H1 – Revitalisation on Track For personal use only Reinforce & Deliver Change the Build Define the Needs Improved Organisation Operating Momentum Rhythm March 2010 June 2010 October 2010 June 2011 December 2011 Define markets & Announce changes Support & measure Capture the benefits opportuniti
Slide 10: Portfolio Performance
F’11 H1 – Portfolio Performance For personal use only SALES $583.7m EBIT $69.3m 9% 6% F '11 v F’10 F '11 v F’10 Industrial NV Medical SHWB Industrial NV Medical SHWB NA LAC EMEA AP Total > +5% From 0% to +5% < 0% Industrial: Strong global performance with all regions recording strong sales & EBIT gr
Slide 11: Industrial GBU Overview
F’11 H1 – Industrial GBU Overview For personal use only 40% of Revenue and 57% of Segment EBIT $M F’10 H1 F’11 H1 HyFlex® 66.1 86.8 Vol up 32%; growth in all regions Other General Purpose 49.9 59.3 All regions, all products Chemical/Liquid Handling 28.1 35.5 Vol up 28%, mostly NA & EMEA Single Use 3
Slide 12: A Guardian Success Story
F’11 H1 – A ® Success Story For personal use only Background Potential customer due diligence undertaken and customer contacted Guardian® program presented to large global manufacturer’s OH&S Director and Team Corporation had over 600 finger injury incidents per annum, with a cost of ~ $2m Factory e
Slide 13: New Verticals GBU Overview
F’11 H1 – New Verticals GBU Overview For personal use only 14% of Revenue and 1% of Segment EBIT $M F’10 H1 F’11 H1 HHG - Retail 12.4 11.1 Vol down 13%, mainly NA Chemical/Liquid Handling 22.4 25.0 Growth in all regions Single Use 21.9 22.4 Military/First Responders 12.8 9.7 Variability in contract
Slide 14: Medical GBU Overview
F’11 H1 – Medical GBU Overview For personal use only 29% of Revenue and 28% of Segment EBIT $M F’10 H1 F’11 H1 Surgeons: PF 54.6 58.4 Volume growth EMEA 12%, AP 8% Powdered 29.3 30.3 Synthetic 16.2 16.7 NA volumes up 19%, EMEA down Exam: PF 32.1 29.8 Lower volumes globally (down 18%) Powdered 4.3 3.
Slide 15: SHWB GBU Overview
F’11 H1 – SHWB GBU Overview For personal use only 17% of Revenue and 14% of Segment EBIT $M F’10 H1 F’11 H1 Condoms: Branded 71.4 77.0 EMEA, LA and AP growth, with Brazil and China strong Tenders/Private Label 6.4 12.0 Indian and Brazilian tenders Lube/Devices/Other 8.5 8.7 Sales 86.3 97.7 13% Segme
Slide 16: Some Key Initiatives for Emerging Market Growth
F’11 H1 - Some Key Initiatives for Emerging Market (EM) Growth For personal use only Sales & Marketing More feet-on-the-street (e.g. Brazil, Middle East, India, China) Customer Intimacy and Relationship Management (eg. - in Brazil and Mexico with localised Guardian® programs) Help set Market standar
Slide 17: Financial Results
For personal use only Financial Results Rustom Jilla Chief Financial Officer 17
Slide 18: Profit & Loss
F’11 H1 – Profit & Loss For personal use only Profit & Loss ($M) F’10 H1 F’11 H1 Sales 533.3 583.7 9% Up 11% before FX GPADE 198.5 205.5 SG&A (132.9) (136.2) EBIT 65.6 69.3 6% Net Interest (4.7) (2.3) Lower NIBD; better returns on cash Taxes (5.0) (4.2) DTAs were $7.9m, LY $8.1m Minority Interests (
Slide 19: EBIT Bridge
F’11 H1 – EBIT Bridge For personal use only $m EBIT BRIDGE 100 18.7 (11.7) 6.4 (3.4) (6.3) 80 69.3 65.6 60 40 20 0 EBIT GPADE GPADE SG&A Incentives SG&A EBIT F'10 H1 Volume Impact "All Other" Restructuring Costs "All Other" F'11 H1 Strong volume growth in key brands/products (HyFlex® ~32%, Surgical
Slide 20: Regional P&L Highlights
F’11 H1 - Regional P&L Highlights For personal use only NA LAC EMEA AP Total Sales $m 207.4 37.6 226.1 112.6 583.7 YoY % Regional $m 20.0 6.4 23.0 25.8 75.2 EBIT YoY % > +5% From 0% to +5% < 0% NA - US and Canadian Industrial sales growth driven by economic recovery and the Guardian® Program. EBIT w
Slide 21: Emerging Markets Sales Growth by Region
F’11 H1 - Emerging Markets Sales Growth by Region For personal use only 40 LAC Industrial /NV sales surged due to new business 30 with key distributors 20 10 Continued strong Brazilian SHWB growth 0 EM 100% of LAC and ~6% of total Ansell sales F'08 H1 F'09 H1 F'10 H1 F'11 H1 60 Good Industrial growt
Slide 22: The NRL Challenge
F’11 H1 – The NRL Challenge For personal use only NRL price trend 10.00 Average price/wet kg* of NRL; 9.00 US$ MYR 8.00 F’08 H1 1.42 4.95 MYR (per wet kg) * 7.00 F’08 H2 1.78 6.08 6.00 F’09 H1 1.75 5.28 5.00 F’09 H2 1.14 4.09 4.00 F’10 H1 1.36 4.85 3.00 2.00 F’10 H2 2.03 7.10 1.00 F’11 H1 2.39 7.74
Slide 23: Ansell's NRL reduction program
F’11 H1 – Ansell’s NRL reduction program For personal use only Strategy Progress Focus more on products that use New polyisoprene surgical gloves other materials launched for ortho and neuro Within exams, accelerate shift to Shift to nitrile for medical and NV synthetics uses Increase selling prices
Slide 24: Resulting in a 25% Reduction in Latex consumed
F’11 H1 – Resulting in … For personal use only Metric Tons A 25% Reduction Outsourced in Latex Manufactured consumed (F’11 H1 vs. F’08 H1) F'08 H1 F'08 H2 F'09 H1 F'09 H2 F'10 H1 F'10 H2 F'11 H1 100% 7 11 High “NRL” 23 80% products now 30 Condom Surgical account for a 60% 23 HHG lower proportion 27
Slide 25: Strong Balance Sheet
F’11 H1 – Strong Balance Sheet For personal use only Balance Sheet ($m) F’10 H1 F’10 H2 F’11 H1 Fixed Assets 139.5 139.5 148.1 Intangibles 297.6 304.7 341.6 Other Assets/Liabilities (15.7) (22.9) (8.4) Working Capital 195.5 196.3 228.9 Net Operating Assets 616.9 617.6 710.2 Net Interest Bearing Debt
Slide 26: Cash Flow Bridge Charts
F’11 H1 – Cash Flow Bridge Charts For personal use only F'11 H1 100 9.4 (32.7) 80 69.3 60 (23.2) 40 11.1 (21.7) (2.2) (6.8) 20 13.8 3.8 7.0 0 EBIT Depn Working CAPEX Interest Taxes FCF Other Dividend Share Net Debt Cap Issues F'10 H1 100 6.7 (5.3) 10.9 (4.5) (6.2) 7.0 (18.8) 80 65.6 67.2 (34.8) 60 4
Slide 27: Full Year Outlook
For personal use only Full Year Outlook Magnus Nicolin Chief Executive Officer 27
Slide 28: H2 – Expectations
F’11 H2 – Expectations For personal use only Market Conditions Action Latex and other raw materials Focus on price increases; move to costs to remain high synthetics; pricing flexibility; Exam and HHG manufacturing improvements Global markets continue to GBU Structure to enhance marketing & recover
Slide 29: Guidance
F’11 – Guidance For personal use only Outlook Dynamic market conditions to continue Business momentum is strong, with Industrial and Emerging Markets leading Actions underway to mitigate commodity cost headwinds Revitalisation on track with Ansell being reshaped into a more agile and responsive comp
Slide 30: Ansell's Mission
Ansell’s Mission For personal use only Ansell protected Confidence to perform Innovative solutions for safety, well-being and peace of mind ... no matter who or where you are 30