FULL YEAR RESULTS Conference call, February 2002

Transcription

1 FULL YEAR RESULTS 2001 Conference call, February 2002

2 This presentation contains forward looking statements which reflect Management s current views and estimates. The forward looking statements involve certain risks and uncertainties that could cause actual results to differ materially from those contained in the forward looking statements. Potential risks and uncertainties include such factors as general economic conditions, foreign exchange fluctuations, competitive product and pricing pressures and regulatory developments. 2

3 Agenda Key achievements & figures Income statement Cash flow Balance sheet Use of funds 3

4 Agenda Key achievements & figures Income statement Cash flow Balance sheet Use of funds 4

5 Key achievements 2001 Strong sales growth + 4.4% RIG % organic + 9.7% comparable structure & constant FX Profit performance Stable EBIT margin of 11.3% on comparable basis; 10.9% after TTS review and GLOBE Excellent net profit growth of 15.9% EPS rises 15.7% 5

6 Key figures 2000 and 2001 Change CHF mio % 2001 % % Sales 81' ' EBITDA 12' ' (0.6) ex TTS EBITA 9' ' ex TTS Trading profit (EBIT) 9' ' ex TTS Net profit 5' ' ex TTS Earnings per share (CHF) 14.91* * adjusted for share split. TTS figures are illustrative. 6

7 Agenda Key achievements & figures Income statement Cash flow Balance sheet Use of funds 7

8 Drivers of sales growth January - December 2001 : CHF 84.7 billion + 4.0% 4.4% REAL INTERNAL GROWTH (RIG) TTS 0 5.3% -1.0% Selling price increases and others Acquisitions minus divestitures -4.7% Variation of exchange rates Sales growth at comparable structure and constant exchange rates: + 9.7% 8

9 Weighted average exchange rates Jan. - Dec. Jan. - Dec. Variation CHF per: (%) Euro (1) U.S. dollar (1) sterling (1) Real (100) Yen (100) Mex. Peso (100)

10 Sales and profitability by management responsibilities and geographic area CHF bio. Sales Profit Margin* Sales Profit Margin*# % % Food Europe Americas AOA Other * Calculation based on non-rounded figures for sales. The % variations are influenced not only by the evolution of sales volumes, but also by acquisitions and divestitures, exchange rate fluctuations, and changes in selling prices. # 2001 % margin negatively impacted by TTS review 10

11 RIG by management responsibilities and geographic area % Food Europe Americas AOA Other activities Total Group

12 RIG in Europe (Food) Key markets % Western Europe France Germany (2.3) 2.0 GB Region Friskies Europe Eastern Europe Russia

13 RIG in the Americas (Food) Key markets % United States and Canada United States Canada (1.1) 4.6 Latin America and Caribbean Brazil Mexico

14 RIG in Asia, Oceania and Africa (Food) Key markets % Oceania and Japan Japan Other Asian markets Philippines Greater China Africa Middle East

15 RIG in Mineral Water (CHF 8.9 bio.) % United States (Bottled) Europe Asia Total Water (excl. Trinks) Trinks 6.6 (1.3) Total Water (incl. Trinks)

16 RIG in Alcon and JVs % Alcon (CHF 4.6 bio) Joint Ventures (CHF 1.2 bio) Galderma CPW

17 Sales and profitability by product group CHF bio. Sales Profit Margin* Sales Profit Margin *# % % Beverages Milk products, nutrition, ice cream Prep. dishes & petcare Chocolate, confect. & bisc. Pharmaceutical * Calculation based on non-rounded figures for sales. The % variations are influenced not only by the evolution of sales volumes, but also by acquisitions and divestitures, exchange rate fluctuations, and changes in selling prices. # 2001 % margin negatively impacted by TTS review 17

18 RIG in Beverages % Soluble coffee Water (incl. Trinks) Total Beverages

19 RIG in Milk products, Nutrition and Ice cream % Milk products Nutrition Ice cream (2.9) (0.4) Total

20 RIG in Prepared dishes, Cooking aids and Petcare % Frozen and chilled Culinary and others Petcare Total

21 RIG in Chocolate, Confectionery and Biscuits % Chocolate n.a 4.4 Confectionery n.a 1.3 Biscuits n.a 1.9 Total

22 RIG in FoodServices % FoodServices

23 EBIT margin maintained despite investing in the future Diff. basis Diff. basis (% of sales) points 2001 (ex TTS) points Sales (CHF million) 81'422 84' Cost of goods sold (46.8) (44.5) +230 (46.1) +70 Distribution (7.2) (7.6) -40 (7.8) -60 Marketing and (32.5) (34.7) -220 (32.4) +10 administration R&D (1.3) (1.4) -10 (1.5) -20 Restructuring (0.4) (0.3) +10 (0.3) +10 Amortisation of goodwill (0.5) (0.6) -10 (0.6) -10 Trading profit (EBIT) TTS review figures are illustrative. 23

24 Marketing investment continues - administrative costs fall Actual CHF bio. % change %of sales Marketing expenses excl. TTS review Administration (4.1) TTS review figures are illustrative. Calculations based on non-rounded figures 24

25 Net profit - major improvement Diff. basis Diff. basis (%of sales) points 2001 (ex TTS) points Trading profit (EBIT) Net financing cost (0.9) (0.5) +40 (0.5) +40 Net non-trading expenses (0.1) (0.1) (0.1) Taxes (3.4) (2.8) +60 (3.0) +40 Outside interests (0.3) (0.2) +10 (0.2) +10 Associated companies Net profit Tax as % of pre-tax profit TTS review figures are illustrative. Calculations based on non-rounded figures. 25

26 Agenda Key achievements & figures Income statement Cash flow Balance sheet Use of funds 26

27 Working capital - returning to appropriate level Improved from half-year increase of CHF 2'562 mio. to increase of CHF 870 mio. Key reasons for movement in Excellent sales development - Emphasis on higher value-added products - Move to regional manufacturing - Strong last quarter Monitored at Centre monthly 27

28 Healthy cash flow CHF mio Free cash flow Operating Cash Flow (OCF) 28

29 Agenda Key achievements & figures Income statement Cash flow Balance sheet Use of funds 29

30 Tangible fixed assets CHF mio Gross tangible fixed assets 43'519 45'093 Less : accumulated depreciation (24'894) (25'195) Net tangible fixed assets 18'625 19'898 30

31 Return on average allocated assets* % Food Europe Americas Asia, Oceania and Africa Other activities * Per Note 1 "Segmental information" 31

32 Return on average allocated assets* % Beverages Milk products, nutrition and ice cream Prepared dishes, cooking aids and pet care Chocolate, confectionery and biscuits Pharmaceutical Group return** * Per Note 1 "Segmental information" ** Net of unallocated items 32

33 Agenda Key achievements & figures Income statement Cash flow Balance sheet Use of funds 33

34 Major acquisitions and divestments in 2001 Annual sales Company Country Business (CHF) Acquisitions Ralston Purina US Petcare 5.0 bio. Ice Cream Partners US Ice cream 1.1 bio. Water Eur, AOA,AMS Retail & Home 400 mio. and office Divestitures Minag Germany Water 250 mio. David & Sons US Confectionery 160 mio. 34

35 The Ralston Purina transaction Has added net debt of USD 10.3 bio. (CHF 17.3 bio. at 1.68 CHF vs. USD) Favourable impact on WACC 35

36 Capital expenditure supports growth CHF mio. % of sales

37 Net indebtedness* up "AAA" maintained 24 CHF billion H1 H2 H1 H2 H1 H2 H1 H * Total financial liabilities minus liquid assets. Liquid assets do not include the carrying value of treasury shares (CHF 2.8 bio. at year-end 2001) 37

38 Non recurring events anticipated for 2002 Capital gain on partial IPO of Alcon (no material impact on taxes expected) Realignment of the Group's Petcare assets to realise announced synergies, including US Distribution Network Rationalisation of asset base triggered by increased globalisation and regionalisation of our businesses and implementation of Globe Treatment of goodwill amortisation currently under review by IAS 38

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