Huhtamaki Strong positions i for profitable growth. CEO Jukka Moisio Pohjola One-on-one Day March 9, 2011

Transcription

1 Huhtamaki Strong positions i for profitable growth CEO Jukka Moisio Pohjola One-on-one Day March 9, 2011

2 Huhtamaki in 2011 Key Fig gures EUR 2.0 Billion in net sales 12,000 People employed Globally Organized 53 Manufacturing units 31 Operating countries Geographically Organized Flexibles Films Molded Fiber Disposables usinesses Bu Reporting Segments Flexible Packaging Films Molded Fiber North America Foodservice E-A-O are of Sales* Sh Net 27% 8% 12% 27% 23% * Other Activities 3% 2

3 Fundamentals of Huhtamaki Specialized in consumer packaging g Three core knowhow areas make 85% of net sales Paper cups and containers -- paperboard key raw material Flexible Packaging and Films -- plastics as key raw material Molded fiber based products -- recycled fiber Global presence with more than 15 years of history and experience at key emerging markets Restructuring, cost reductions and operative focus brought good financial position and infrastructure to grow 3

4 20% of sales from the emerging markets* 28 % 49 % 12 % 2% 3% 6% 4,500 out of 12,000 employees in emerging markets 24 out of 53 manufacturing units in emerging markets * Definition of emerging markets based on IMF s report World Economic Outlook

5 Strong market positions Foodservice Europe-Asia-Oceania Cups and lids to quick service, vending and catering Flexible Packaging Films Tube laminates and retort laminates for petfood Release films worldwide North America Shaped paperboard packaging for frozen desserts and branded tableware Molded Fiber Recycled fiber packaging g 5

6 Financials 2010

7 Group highlights Full year and Q EUR million Q Q Continuing operations Net sales 1, , EBIT * EBIT margin % EPS * Including discontinued operations EPS ROI % Free cash flow Net sales increased due to currency translation and volume growth Profitability improved markedly Strong cash flow; net debt reduced considerably Majority of the European Rigid Consumer Goods Plastics operations sold The Board of Directors proposes a dividend of EUR 0.44 per share * Excluding non-recurring charges of EUR 3.8 million. 7

8 Volume development Q Flexible Packaging 7% 6% Films 17% 22% North America -3% -4% Molded Fiber 0% -1% Foodservice EAO 3% -2% Group total 2% 1% 8

9 Group statement of financial position December 31 EUR million Total assets 1, ,758.6 Operating working capital Net debt Equity + non-controlling interest Gearing ROI % ROE %

10 Strong cash flow generation MEUR EBITDA Change in Net financial Taxes Capital Proceeds from working capital items expenditure selling assets Other Free cash flow 10

11 Net debt reduced considerably 400 MEUR MEUR reduction in Q4 09 Q1 10 Q2 10 Q3 10 Q

12 Achievements 2010 Best Huhtamaki performance as a dedicated packaging g company since 2000 ROI 12% ROE 14.5% Highest ever dividend proposal Lowest gearing Lowest net debt/ebitda ratio 12

13 Outlook 2011 The improvement in the Group s trading conditions, which was visible in the second half of 2010, is expected to continue during However, market conditions in North America remain uncertain. Pressure on profit margins is likely to continue due to increasing raw material costs, especially the price of plastics. Financial charges and tax expenses are expected to increase from the exceptionally low level in Good financial position and ability to generate a positive cash flow will enable the Group to address profitable growth opportunities. Capital expenditure is expected to be around EUR 100 million. Short-term risks and uncertainties: Volatile raw material and energy prices as well as movements in currency rates are considered to be relevant short-term business risks and uncertainties in the Group's operations. General economic and financial market conditions can also have an adverse effect on the implementation of the Group's strategy and on its business performance and earnings. 13

14 Shifting focus to growth-driven value creation

15 Financial targets ROI 15% Net debt/ebitda target corridor at 2-3 Free cash flow around MEUR 100 annually Dividend policy: 40-50% of result 15

16 Shifting focus to growth Cash use priorities going g forward Dividends remain #1 priority Acquisitions, redeployment of funds Debt level managed within target corridor Capital structure allows MEUR 300 fire power for acquisitions Screening targets in Developed markets - market consolidation and synergies Emerging markets - growth 16

17 Engines for organic growth Flexibles benefiting from modern retail Away-from-home trend drives increased consumption Sustainable products and concepts Light-weighting Renewable raw materials Recyclability Emerging market footprint 17

18 Looking for acquisition possibilities Follow key customer NPD* and geographies Economic recovery and growth call for new products Branded d consumer companies at growth mode and bullish Sustainable products starting to feature more strongly in discussions Look to acquire businesses that make us stronger Market position reinforcement and cost synergy at developed markets Growth platform and cost optimization at developing & emerging markets * NPD = New product development 18

19 What s different for growth? Closure / divestment of weak businesses nearly complete Solid financial base Strong foundation in emerging economies Favorable market trends Away-from-home consumption Source reduction favoring flexibles Foam replacement Leading market positions Focused business segments Longstanding customer base 19

20 Scheduled events in 2011 April 20 AGM April 20 Interim Report Q July 21 Interim Report Q October 20 Interim Report Q Updates on the schedule: Investors» Calendar 20

21 For further information, please contact us: Investors IR Manager Kaisa Marttinen Tel

22 Appendices

23 Earnings and returns improved clearly EBITDA (MEUR) EPS (EUR) ROI (%) * 2010* * 2010* * Excluding discontinued operations 23

24 Strong cash conversion % Group: Free cash flow vs. Result Segments: Operating cash flow vs. EBIT GROUP Flexible Packaging Films North America Molded Fiber Foodservice Moderate capex not exceeding depreciation Working capital improvements Low cash interest and tax 24

25 Free cash flow and divestment proceeds applied to dividends and debt reduction MEUR (cumulative ) 600 Divestment proceeds Debt reduction 200 FCF Dividends 0 25

26 Flexible Packaging: Leader in technology and innovation Markets and products Food & Tube Petfood Beverages laminates Personal care & household Labels Sales by geography Europe Asia ROW MEUR Net sales EBIT EBIT margin % RONA % Strong market position in Biscuits and confectionary in India Coffee in Thailand and Vietnam Chocolate in Europe Tube laminates and pet food worldwide Major customers Major players Competitive advantages Excellent technical knowhow Leading in South and Southeast Asia Strong anchor in Europe High focus on innovation, NPD Growth potential 6-8% p.a. - mainly driven by Asia and selected market segments in Europe 26

27 North America: Leading position based on molded fiber and shaped paperboard Markets and products Sales by market channel Consumer Goods Consumer Goods Retail Foodservice Foodservice Retail MEUR Net sales EBIT EBIT margin % RONA % Strong market positions Leading position in shaped containers for frozen desserts Leading position in premium branded tableware market (Chinet products) Major customers Major players Competitive advantage Chinet brand Consumer reputation Paper forming expertise and systems capability Operation and supply chain excellence Molded fiber technology and cost position Growth potential 3-4% p.a. - di driven by Retail and Foodservice 27

28 Foodservice E-A-O: Global footprint brings competitive advantage Markets and products QSR Catering Industry Vending Sales by geography Western Europe Eastern Europe Asia-Oceania MEUR Net sales EBIT EBIT margin % RONA % Strong market positions Europe: #1 Asia-Oceania: #1 Customers Major players Competitive advantage Long term presence in emerging markets, global network and footprint Leading in sustainable solutions - BioWare Paper forming expertise High quality standards Growth potential ~5% p.a. driven by Eastern Europe and Asia 28

29 Molded Fiber: Global presence and strong technological knowhow Markets and products Sales by geography Egg packaging Fruit trays Europe ROW MEUR Net sales EBIT EBIT margin % RONA % Market position Global #1 Major customers Retailers Competitive advantage Local presence In-house proprietary technology Experienced team Packers In-house recycled paper sourcing Major players Growth potential 3-4% p.a. driven by emerging markets 29

30 Films: Leading competencies and technical knowhow Markets and products Building and construction Pressure sensitive Hygiene and healthcare Technical markets and speciality packing Sales by geography Europe NA Asia MEUR Net sales EBIT * EBIT margin % RONA % (12m roll.) *Excl. non-recurring charges of EUR 3.8 million. Market position Global leader in release films Major customers Major players Competitive advantage Strong technical knowhow, especially in silicone coating Global manufacturing capability High focus on innovations Competence in release film applications and bio films Growth potential 5-10% p.a. 30

31 Increasing the weight of sustainable and non-cyclical raw materials in the portfolio Flexible Packaging Films Foodservice E-A-O Plastics Other Paper Recycled Fiber North America Molded Fiber * In purchased value, excluding energy cost 31

32 Improved margin predictability Value added margin* Huhtamaki Raw Material Index EBIT margin* Q Q Q Q Q Q Q Q * 12 month rolling 32

33 Solid domestic shareholding 26,858 registered shareholders at the end of December % of shares controlled by non-profit organizations Finnish Cultural Foundation a major owner since 1943, current ownership 17.2% Shareholder distribution by sector December 31, % of shares in domestic ownership 25 % 22 % 25 % 11 % 10 % 7 % Private companies Financial and insurance companies Public-sector organizations Households Non-profit organizations Foreigners 33