Bringing packaging to life RPC GROUP PLC 2012/13 RESULTS 05 JUNE 2013

Transcription

1 Bringing packaging to life RPC GROUP PLC 2012/13 RESULTS 05 JUNE 2013

2 2 AGENDA Introduction Business review Fitter for the Future Financial review Strategic development PV PV FD SK PV

3 3 BUSINESS REVIEW REVENUE DEVELOPMENT Revenue reduced by 79m due to movements in exchange rates of 45m and the exit from certain sectors such as mainland European vending cups Underlying activity levels similar to last year despite recessionary Eurozone and UK economies where 86% of the groups revenues originate Sales mix continues to improve towards higher added value products Dairy Products Pharmaceutical 7% Other food 24% Food 58% 7% 9% Long shelf-life Coffee Other non-food Non-Food 42% Surface coatings 11% Spreads Personal care and Cosmetics

4 4 BUSINESS REVIEW MARKET DEVELOPMENTS MARKET SEGMENT Personal care & cosmetics % OF TURNOVER ACTIVITY LEVELS 13% Spreads 11% Coffee 9% COMMENT Consolidating previous growth - new product development starting up Stable market with trend towards In-Mould-Label Injection moulding Continued strong growth in capsules for single-serve coffee systems Surface coatings 8% Impacted by UK housing market and Spanish economy Good growth realised with further opportunities to Pharmaceutical 4% enhance market share Stable market but activity levels down due to exit of Other food 38% mainland European vending cups Other non-food 17% Good growth in the agrochemical business

5 5 BUSINESS REVIEW SALES MIX Higher added value products Higher added value products have grown by a CAGR of 14% in the last four years and now represents 32% of the Group s turnover Strong growth in the year of coffee capsules and Superfos thin wall/barrier food containers Sales of higher added value products as % of group revenue (at constant FX rate)

6 6 BUSINESS REVIEW INPUT COST DEVELOPMENTS Polymer Price Development PER TONNE Global PP Supply/Demand Outlook TONNES (M) OPERATING RATE % % 95% 90% 85% 80% 75% 70% HDPE BM PP HOMO Operating Rate Demand Free Capacity Source: Platts / ICIS Source: Chemical Market Associates, Inc. Volatile Polymer prices in 2012/13 leading to an adverse time lag effect in pass through to customers

7 7 FITTER FOR THE FUTURE Programme contents: Programme current status: Rationalise manufacturing footprint Optimisation pan-european thermoforming and injection moulding spreads production progressing on schedule. Antwerp production has been successfully transferred and Beuningen business is in the process of transfer Fitter for the Future optimisation programme Optimise existing business portfolio Optimisation programme Oakham progressing well Cost efficiency programmes at several sites in mainland Europe accelerated Focus on supporting higher added value business Realise value redundant properties Sales contracts for 2 properties now agreed Extended the rental contracts on 2 properties of sold businesses. Two properties (Netherlands and UK) being marketed

8 8 FITTER FOR THE FUTURE Support RPC Group s strategy to deliver a sustainable return through the economic cycle Estimated cumulative P/L impact of at least: million ACTUAL FORECAST 2012/ / /15 EBIT Impact * *Annual run rate of 12m Cash outflow Fitter for the Future ( m) (19) (7) (8) Early project completion on several cost efficiency programmes has delivered an acceleration of the savings anticipated (11) Incurred to date Remaining spend Capital expenditure associated with the programme will be funded from on-going investment budgets Further opportunities to optimise the business portfolio are being explored

9 9 FINANCIAL REVIEW KEY FIGURES Revenue Adjusted operating profit Adjusted basic EPS* All figures (except adjusted basic EPS) in m Adjusted = before restructuring costs, impairment losses and mark to market charges * Restated following Rights Issue in 2011

10 10 FINANCIAL REVIEW VARIANCE ANALYSIS Adjusted operating profit ( m) *Non-polymer cost inflation based on national indices and before corrective actions by the group

11 11 FINANCIAL REVIEW KEY FIGURES Net cash from operating activities Return on net operating assets Dividend per share* Net cash from operating activities in m ROCE 10.7% 13.5% 15.1% 19.3% 18.3% DIVIDEND COVER * Restated following Rights Issue

12 12 FINANCIAL REVIEW CASH FLOW BRIDGE * Includes exchange rate movements, provision movements & movement on derivatives

13 13 FINANCIAL REVIEW FINANCIAL POSITION KPIs MAR 2013 Renewal date main facilities Gearing 63% Net debt ( m) 171 Undrawn facilities ( m) 336 Net debt to EBITDA ratio 1.30x EBITDA to Net Interest ratio 11.8x RCF Term USPP USPP

14 14 OUTLOOK Group is well placed to benefit from economic recovery from a position of sound financial strength The immediate outlook is hampered by the continuing lack of growth in Europe Further progress expected with Fitter for the Future programme and sales mix enhancement New financial year has started in line with management expectations

15 15 STRATEGIC DEVELOPMENT CONTEXT Rigid plastic packaging market characteristics Market consists of a series of niches and is not a big homogenous market Biggest markets are currently in Europe and the US but highest growth in emerging markets Rigid plastic packaging grows faster than other materials driven by substitution trends Forecast growth in packaging markets, by material: CAGR (%) World Europe US BRIC Brazil Russia India China Source: Pira International, 2011 Rigid Plastics Glass Metal Total Market RPC s current position Leading technological capability in all three major conversion processes Manufacturing facilities based in Europe with one site in the USA Strong market positions in its chosen product markets and geographical areas

16 16 STRATEGIC DEVELOPMENT PRODUCT MARKET COMBINATIONS % of FY12/13 revenue Niche (22%) Strong Commodity strong (73%) Competitive position Commodity (5%) 4% Weak Low Market attractiveness High

17 17 STRATEGIC DEVELOPMENT DIRECTION RPC s strategy is to grow and develop leading positions in its chosen product markets and geographical areas in the rigid plastic packaging industry, by maintaining strong long-term relationships with its customers and by developing high quality, innovative products that meet customer needs. The Group achieves and maintains its leading market positions by continued innovation and investment, leveraging RPC s leading technological capability, manufacturing and supplying product efficiently and through strategic corporate development. Where we manufacture Where we sell Review The management team is reviewing the current business portfolio and its growth prospects both within and outside of Europe to further focus its resources and optimise shareholder value.

18 18 FORWARD LOOKING STATEMENTS This presentation contains forward-looking statements, which: have been made by the directors in good faith based on the information available to them up to the time of their approval of this presentation; and should be treated with caution due to the inherent uncertainties, including both economic and business risk factors, underlying such forward-looking information. The Company undertakes no obligation to update these forward-looking statements and nothing in this presentation should be construed as a profit forecast.

19 19 APPENDICES

20 20 FINANCIAL REVIEW CONSOLIDATED INCOME STATEMENT million 2012/ /12 Variance Revenue 1, ,129.9 (78.6) Operating profit adjusted (3.8) Interest charge (13.4) (13.2) (0.2) Profit before tax adjusted (4.0) Tax on adjusted profit before tax (18.9) (20.1) 1.2 Profit after tax adjusted (2.8) Exceptional items (36.0) (20.6) (15.4) Tax relief on exceptional items (1.1) Mark to market (charges) / credit - (0.1) 0.1 Profit after tax reported (19.2) Basic earnings per share (p) adjusted 34.8p 37.3p (2.5)p Basic earnings per share (p) reported 15.5p 27.7p (12.2)p

21 21 FINANCIAL REVIEW EXCEPTIONAL COSTS million 2012/13 Strategic exit from MLE vending / automotive components 6.3 Impairment properties held for sale 1.5 Impairment goodwill sheet businesses 5.8 Completion phase 1 Superfos synergies & other integration 3.2 Fitter for the Future project

22 22 FINANCIAL REVIEW SEGMENTAL ANALYSIS - IFRS 8 BASIS million FY 2012/13 FY 2011/12 Variance Revenue* (40.3) Injection Moulding Operating profit ** (4.1) Return on sales ** 10.2% 10.2% - Return on net operating assets ** 27.2% 28.2% (1.0)% Revenue* (34.6) Thermoforming Operating profit ** Return on sales ** 6.3% 4.8% 1.5% Return on net operating assets ** 20.9% 20.0% 0.9% Revenue* (3.7) Blow Moulding Operating profit ** (1.9) Return on sales ** 6.1% 7.1% (1.0)% Return on net operating assets ** 17.4% 21.8% (4.4)% * External sales only ** Based on adjusted operating profit before restructuring costs and impairment losses

23 23 FINANCIAL REVIEW SEGMENTAL ANALYSIS - GEOGRAPHICAL million FY 2012/13 FY 2011/12 Variance UK Revenue (6.6) Operating profit * Return on sales 9.6% 8.7% 0.9% Mainland Europe (including USA) Revenue (72.0) Operating profit * (5.3) Return on sales 8.2% 8.2% -

24 24 BUSINESS REVIEW INPUT COST DEVELOPMENTS

25 25 FINANCIAL REVIEW CONSOLIDATED BALANCE SHEET million MAR 2013 MAR 2012 Property, plant and equipment Goodwill Other non-current assets Working capital Employee benefit liabilities (LT) (62.1) (56.3) Other assets & liabilities (53.5) (54.2) Net debt (171.4) (160.0) Equity shareholder funds

26 26 FINANCIAL REVIEW PENSIONS UPDATE million MAR 2013 MAR 2012 Retirement benefit liability UK DB Other retirement benefit obligations Termination benefits Other employee benefit liabilities Total employee benefit liability (LT)

27 27 STRATEGIC CORPORATE DEVELOPMENT ACQUISITION CRITERIA EXISTING MARKETS Consolidate and grow core market positions Acquire where: Existing strong market positions can be further enhanced Consolidation can create new strong market positions Available synergies enhance shareholder value NEW GEOGRAPHIES Expand our markets based on technology and higher added value packaging Selectively explore investment partnership, JV, acquisition in order to create / cement strong or differentiated positions and participate in high growth emerging markets

28 28 BUSINESS REVIEW GROUP STRUCTURE / MANAGEMENT TEAM Executive Board Members Chief Executive Pim Vervaat 6 years* Group Finance Director Simon Kesterton Group Purchasing Darin Evans 15 years* Business Improvement Frank Doorenbosch 24 years* Cluster Managers Superfos 11 sites UKIM 5 sites Bramlage Wiko 9 sites Blow Moulding 12 sites Bebo / T-G 9 sites Cobelplast 2 sites René Valentin 21 years* Bruce Margetts 25 years* Alfons Böckmann 37 years* Stephan Bühl 18 years* Thomas Wahlmeyer 31 years* Supported by: Corporate Development Tom Saunderson 3 years* * Years experience in the plastic packaging industry