2005 full year results conference call

Size: px

Start display at page:

Download "2005 full year results conference call"

Sophie Owens
5 years ago
Views:

1 2005 full year results conference call - February full year results conference call

2 full year results conference call - February : Delivering The Nestle Model: Improvement in key performance measures Strong organic growth both F&B and Pharma: 6.2% EBITA margin up 20bps to 12.9%; up 1 Billion CHF Improvement in Return on invested capital: +50bps Underlying EPS up 12.9%; dividend 9 CHF up 12.5% Strong cash flow - 1st buy-back complete; 2nd begun 4.5 Billion CHF returned to shareholders: up 59% vs 04 Group transformation on track - Health, Nutrition, Wellness, GLOBE, European Chilled Dairy

3 full year results conference call - February 2006 Disclaimer 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.

4 full year results conference call - February 2006 Restatement of 2004 results 2004 results have been restated following the first application of IFRS 2 share-based payment and the discontinued operation resulting from the announcement in December 2005 for the chilled dairy activities in Europe, where applicable Full Year RIG & Organic Growth also restated.

5 Product groups: organic growth above 5-6% target 12% sales CHFbn Beverages Milk products, Nutrition and Ice cream Prepared dishes and cooking aids Chocolate, confectionery and biscuits PetCare Pharma Group full year results conference call - February 2006

6 Zones: organic growth - broad based improvement 12% sales CHFbn Europe AOA full year results conference call - February Water America 30.8 Other activities Group 91.1

7 full year results conference call - February 2006 P&L to EBITA: savings compensate cost pressures FY 2004 FY 2005 Diff. basis points As % of sales Restated (rounded) Sales (CHF million) 84'690 91' Cost of goods sold (41.7) (41.7) - Distribution (8.1) (8.1) - Marketing & Admin (35.8) (35.7) 10 R & D (1.7) (1.6) 10 EBITA restated following the first applicationod IFRS Share-based Payment and the discontinued operation resulting from the announcement made in December 2005 for the Chilled Dairy activities in Europe, where applicable.

8 full year results conference call - February 2006 EBITA influencers Positive Currencies Efficiency savings Pharma: Alcon Portfolio optimisation Strong RIG Negative China Input costs Russian confectionery Share based payments UK confectionery

9 full year results conference call - February 2006 Evolution of EBITA margin 13.1 Market Mix + 30 Operational activities Currencies + 10 Share based payments Portfolio optimisation + 10

10 % margin Product groups: EBITA margins (2004 restated) Beverages Milk, Nutrition Prep. dishes & Choc., confect. PetCare Pharma Group EBITA Ice cream cooking aids and biscuits CHF bn full year results conference call - February 2006

11 P&L: EBITDA to Net profit FY 2004 FY 2005 Diff. basis points As % of sales Restated (rounded) EBITDA EBITA Net other income/expenses (0.8) (1.0) (20) Amortisation of goodwill (1.9) Net financing cost (0.8) (0.6) 20 Taxes (2.8) (2.9) (10) Discontinued operations Share of results of Associates (90) Profit for the period of which Attributable to Minority interests (0.5) (0.6) (10) Attrib. to the Group (Net profit) Underlying EPS (CHF) % 2004 restated following the first applicationod IFRS Share-based Payment and the discontinued operation resulting from the announcement made in December 2005 for the Chilled Dairy activities in Europe, where applicable full year results conference call - February 2006

12 full year results conference call - February 2006 Cash flow and financial position remain strong Operating and free cash flow decline slightly due to CHF600 million cash injection to pension funds Cash conversion cycle unchanged at 47 days Capital expenditure down 10bps as % of sales Net debt declines from CHF10.2 bn to CHF9.6 bn Proposed dividend up 12.5% to CHF 9 per share 3 billion share buy-back under way The Nestlé Model: Creating value for shareholders

13 full year results conference call - February 2006 Increased EPS reflected in dividend payments +11.8% CAGR CHF per share

14 Actively managed capital structure benefits shareholders: cash returns CHF bn Net debt % Share buy back Dividend % * * 2006 assumes completion of 2nd buy-back programme and payment of proposed CHF 9 dividend full year results conference call - February 2006

15 2005 full year results conference call - February 2005 Questions & answers

16 full year results conference call - February 2006 Roadshow agenda Key financials Value creation - growth & innovation Strategic overview 2005/6 Management & Corporate governance 2006 outlook

17 full year results conference call - February 2006 Conclusion: successful delivery of The Nestlé Model Organic growth ahead of market, driven by key brands Margin improvement achieved despite input cost inflation and one-off issues The Nestlé Model reconfirmed for 2006: 5-6% growth and consistent improvement in margin

18 2005 full year results conference call - February 2005 Background slides

19 full year results conference call - February tax rate & underlying earnings per share* Underlying tax rate decreased from 28.3% to 28.1% - mainly due to market and currency mix ongoing tax rate to be below 30% Underlying EPS increased 12.9% to CHF (*definitions on next slide)

20 full year results conference call - February 2006 Calculation of underlying EPS - methodology Net profit from continuing operations before amortisation and impairment of goodwill impairment of property, plant and equipment restructuring costs results on disposals material one-off items incl. in Net other income (expense) material one-off tax items The tax charge used for this calculation is adjusted for the tax effect of the excluded items (underlying tax charge).

21 full year results conference call - February 2006 Primary reporting: 2005 RIG and organic growth % Growth % RIG % Organic Growth Sales CHF bn Americas 30.8 Europe 27.6 AOA 15.7 Waters 8.8 Other 8.2

22 % margin Primary reporting: EBITA margins (2004 restated) EBITA CHF bn Americas Europe AOA Waters full year results conference call - February Other 2.1

23 % Growth Sales CHF bn Product groups: 2005 RIG and Organic Growth Beverages 3.5 Milk products, Nutrition and Ice cream % RIG % Organic growth Prepared dishes and cooking aids full year results conference call - February Chocolate, confectionery and biscuits 4.1 PetCare Pharma 6.0

24 Operating and free cash flow - includes CHF600mn extra contribution to certain pension funds in 2005 CHF billion Free cash flow Operating cash flow full year results conference call - February 2006

25 full year results conference call - February 2006 Cash conversion cycle Days (AVG trade receivables/sales) x (AVG inventory/ COGS) x (AVG trade payables/ COGS) x 365

26 Net indebtedness CHF billion * Total financial liabilities minus liquid assets. Liquid assets do not include the carrying value of treasury shares (CHF 2.8bn. at year-end 2005) full year results conference call - February 2006

27 full year results conference call - February 2006 Currencies average exchange rates CHF per FY 2004 FY 2005 % change Euro (1) U.S. dollar (1) sterling (1) Real (100) Yen (100) Mex. Peso (100)

28 full year results conference call - February 2006 Evolution of Group's factories 2005 Number of factories at Acquired/set up 2 Sold/closed (14) Other (satellised) (1) Factories at

29 full year results conference call - February 2006 RIG and organic growth in the zones 2005 RIG OG % % Europe Western Europe Eastern Europe Americas US and Canada Latin America Asia, Oceania and Africa

30 full year results conference call - February 2006 RIG and organic growth in Europe (Food): - Key Markets 2005 RIG OG % % Western Europe France Germany PetCare Europe GB region Eastern Europe Russia

31 full year results conference call - February 2006 RIG and organic growth in the Americas (Food): - Key Markets 2005 RIG OG % % United States and Canada United States PetCare North America Dreyer's Canada Latin America & Caribbean Brazil Mexico

32 full year results conference call - February 2006 RIG and organic growth in AOA (Food): - Key Markets 2005 RIG OG % % Oceania and Japan Japan Other Asian markets Greater China Philippines Africa Middle East

33 full year results conference call - February 2006 RIG and organic growth in Nestlé Waters 2005 RIG OG % % North America Europe Rest of the world Total Nestlé Waters

34 full year results conference call - February 2006 RIG and organic growth in Other activities 2005 RIG OG % % Alcon Group JVs including: - CPW Galderma Total Other activities

35 full year results conference call - February 2006 RIG and organic growth in Beverages 2005 RIG OG % % Soluble coffee Nestlé Waters Beverages

36 full year results conference call - February 2006 RIG and organic growth in Milk products, Nutrition & Ice Cream 2005 RIG OG % % Milk products Nutrition Ice cream Milk products, Nutrition, Ice cream

37 full year results conference call - February 2006 RIG and organic growth in Prepared dishes and Cooking aids 2005 RIG OG % % Frozen and chilled Culinary and others Prepared dishes and cooking aids

38 full year results conference call - February 2006 RIG and organic growth in Chocolate, Confectionery & Biscuits 2005 RIG OG % % Chocolate Confectionery Biscuits Chocolate, Confectionery, Biscuits

39 full year results conference call - February 2006 RIG and organic growth in PetCare 2005 RIG OG % % Europe North America PetCare

40 full year results conference call - February 2006 RIG and organic growth in FoodServices 2005 RIG OG % % Europe Asia, Oceania & Africa Americas FoodServices

41 2005 full year results conference call - February full year results conference call

FULL YEAR RESULTS Conference call, February 2002

FULL YEAR RESULTS Conference call, February 2002 FULL YEAR RESULTS 2001 Conference call, February 2002 This presentation contains forward looking statements which reflect Management s current views and estimates. The forward looking statements involve