Investor Relations Presentation. Delivering solutions, shaping the future

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Transcription:

Investor Relations Presentation Delivering solutions, shaping the future

Our Story Leader Differentiator Consistency Decades of experience Leading the dispensing solutions niche of the packaging industry Helping our customers differentiate their brands Providing convenience to end-consumers Experienced management team Executing a consistent long-term strategy with stable, long-term growing results 2

Diverse Business Model Products and Services End Markets Geographic Presence Quality Customer Base Industry s broadest portfolio Serving 8 endmarkets Manufacturing presence in 18 countries World s best known brands and growing regional customer base 3

Our Business Segments Market-focused under three brands Global R&D, regional manufacturing, regional sales. Each brand actively promotes ALL of our products and services to customers in its markets. 4

Synergies: the Collective Strengths of Aptar Products Innovation Manufacturing Sustainability Corporate Services Procurement People Development Leveraging technologies, know-how and best practices across each segment 5

Sales by Region Six Months Year to Date 2016 Manufacturing presence in 18 countries Europe 57% USA 27% Asia 7% Latin America 9% 6

Core Strategy Elements Focus on Market Application Fields Niche Dispensing & Sealing Solutions Be the Innovative Leader Competitive Operational Excellence Focused teams Consumer behavior and market trends Data analytics Convenient access to the product, security and compliance Focus on intellectual property 3% of sales invested annually in R&D Recognized with various packaging awards Continuous excellence initiatives Sourced and produced locally Investing in new capabilities 7

Balanced Capital Allocation Investing in Ourselves Strategic M&A Share Repurchases Dividends Focus on innovation, growth and increased productivity 2015 ROIC =14% Mega Airless = $218M Aptar Stelmi = $200M Ongoing repurchase program Current annual dividend = $1.20 2015 was 22 nd consecutive year of paying an increased dividend Investing in key capabilities Target capital ranges: Net debt / EBITDA: 1-3 (currently > 1) Net debt / net capital: 25-40% (currently = 30%) Dividend per share payout ratio: 30-40% of EPS (2015 = 37%) 8

Aptar Consolidated Financial Targets Metric 3 Year Average 2015 Long-term Target Core sales growth 1 3% 1% 6-8% Adj. EBITDA 2 /Sales % 18% 20% 20% ROIC 3 13% 14% 14% Dividend Payout Ratio 38% 37% 30-40% 1 Excludes acquisitions and currency effects. 2 Earnings before net interest, taxes, depreciation and amortization; earnings exclude acquisition costs, non-recurring purchase accounting adjustments and restructuring charges. 3 Return on invested capital = adjusted earnings before net interest and taxes, less tax effect / average capital (average of beginning of year and end of year capital) [capital = equity plus debt less cash]. 9

$ in millions Q2 2016 Revenue and EPS SALES COMPARABLE EPS $600 $400 $594 Reported +4% $620 $1.00 $0.80 $0.60 $0.81 (1) $0.91 Core 3% $0.40 $200 $0 Acquisitions 3% Currency Effects (2%) Q2 2015 Q2 2016 $0.20 $0.00 Q2 2015 Q2 2016 (1) For Q2 2015, reported EPS was $0.90. Comparable EPS excludes the effects of the change to the FIFO inventory valuation method ($0.08 per share), and adjusting to a comparable foreign currency environment ($0.01) 10

$ in millions Six Months Year-to-Date 2016 SALES COMPARABLE EPS $1,200 $800 $1,184 $1,202 Reported +2% $1.80 $1.20 $1.50 (1) $1.63 (2) Core 2% $400 Acquisitions 2% $0.60 Currency Effects (2%) $0 YTD 2015 YTD 2016 $0.00 YTD 2015 YTD 2016 (1) For YTD 2015 reported EPS was $1.59. Comparable EPS excludes the effects of the change to the FIFO inventory valuation method, ($0.07 per share), and adjusting to a comparable foreign currency environment ($0.02) (2) For YTD 2016, comparable EPS excludes transaction costs of $0.06 and purchase accounting adjustments to inventory values of $0.03 related to the Mega Airless acquisition, and the net effect of certain items included in the provision for income taxes ($0.04) that were recognized in the first quarter of 2016 11

Business Snapshot Beauty + Home Six Months YTD 2016 Percent of Sales by Region Customer Sample 56% 24% 13% 7% Europe North America Latin America Asia Products Six Months YTD 2016 Percent of Sales by Market 49% 43% Beauty Personal Care Home Care 8% 12

Financial Targets Beauty + Home Metric 3 Year Average 2015 Long-term Target Core sales growth 1% -2% 4-7% EBITDA 1 /Sales % 13% 14% 16% Segment Income/Capital 2 11% 12% 15% 1 Segment EBITDA is defined as Segment Income before depreciation and amortization. 2 Calculated as segment income / average capital (average of beginning of year and end of year capital) [capital = equity plus debt less cash]. 13

Key Drivers for Achieving Growth Targets Beauty + Home Maintain market share leadership in key applications Grow in market applications where we are not leaders today Expansion in Asia China India 14

Business Snapshot Pharma Six Months YTD 2016 Percent of Sales by Region Customer Sample 72% 22% Europe North America Latin America Asia 4% 2% Products Six Months YTD 2016 Percent of Sales by Market 56% 25% 19% Prescription Consumer Health Care Injectables 15

Financial Targets Pharma Metric 3 Year Average 2015 Long-term Target Core sales growth 1 7% 8% 6-10% EBITDA 2 /Sales % 33% 35% 29-34% Segment Income/Capital 3 48% 53% 44% 1 Excludes acquisitions and currency effects. 2 Segment EBITDA is defined as Segment Income before depreciation and amortization. 3 Calculated as segment income / average capital (average of beginning of year and end of year capital) [capital = equity plus debt less cash]. 16

Key Drivers for Achieving Growth Targets Pharma Access to healthcare and growth of generic drugs Expansion into new therapeutic areas Self medication (over-the-counter) 17

Business Snapshot Food + Beverage Six Months YTD 2016 Percent of Sales by Region Customer Sample 47% Europe North America 28% 18% 7% Latin America Asia Products Six Months YTD 2016 Percent of Sales by Market 58% 42% Food Beverage 18

Financial Targets Food + Beverage Metric 3 Year Average 2015 Long-term Target Core sales growth 7% 2% 10% EBITDA 1 /Sales % 18% 19% 18% Segment Income/Capital 2 20% 21% 22% 1 Segment EBITDA is defined as Segment Income before depreciation and amortization. 2 Calculated as segment income / average capital (average of beginning of year and end of year capital) [capital = equity plus debt less cash]. 19

Key Drivers for Achieving Growth Targets Food + Beverage Convert targeted application fields to Aptar s dispensing solutions Leverage our broad range of proven technical platforms Maintain our focus on commercializing new innovative dispensing solutions 20

Delivering solutions, shaping the future Visit us at aptar.com

Appendix

Forward-Looking Statements This presentation includes forward-looking statements. Forward-looking statements are made pursuant to the safe harbor provisions of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 and are based on management s beliefs as well as assumptions made by and information currently available to management. Accordingly, the Company s actual results may differ materially from those expressed or implied in such forward-looking statements due to known or unknown risks and uncertainties that exist in the Company s operations and business environment, including, among other factors, those described in documents filed by the Company with the Securities and Exchange Commission, specifically its Form 10-Ks and 10-Qs. The Company does not assume any obligation to update, amend or clarify such statements to reflect events, new information or circumstances after the date of this presentation. 23

Aptar s Strategy Market Focused Organization Conversion opportunities Our Core Values are the foundation of our company Diversified Business Model Products & Services; End Markets; Geographic; Customers Niche Dispensing Packaging Solutions Provider Convenience, security, regulatory compliance Cost Competitive Operations Worldwide Source locally Aptar Production System New manufacturing innov. Innovation Leader within Niche Goal is 10% or more of Aptar sales per year in innovative products Our synergies strengthen the overall business model allowing us to leverage technologies, common systems and centralized services across all business segments Motivated, Talented Workforce Development programs Succession planning 24

Our Expertise Market and consumer insight Creative and customized solutions Precision injection molding High-speed assembly Elastomer formulation and production Operating in a regulatory environment 25

2015 Corporate Sustainability Report Second prepared by Aptar using the Global Reporting Initiative (GRI) G4 (Core) reporting guidelines Includes limited third-party assurance of energy-related metrics Provides examples of the work Aptar has done to: Reduce waste to landfill Source renewable energy Test and evaluate new, more efficient equipment Institute standardized management plans to reduce environmental impacts Conduct product life cycle assessments and explore sustainable materials Promote social initiatives in the communities where we live and work 26 26

Our Delivery Solutions Aerosol Valves & Bag-on-Valves Metered Dose Valves Nasal Pumps Fragrance Pumps Lotion Dispensers Dispensing Closures Sampling Systems Custom Decorations Cosmetic Pumps Elastomeric Flow Control Airless Systems & Precise Applicators Dose Counters & Indicators Silicone Tip Dispensing Bonded Aluminumto-Plastic (BAP) Food Service Dispensing Components Lab & Analytical Services Dry Powder Inhalers Elastomer Components 27

$ in millions $ in millions Strong Long-Term Financial Performance $3,000 SALES $2,500 $2,000 $1,500 $1,000 $500 $0 $200 8% CAGR '93 '94 '95 '96 '97 '98 '99 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 NET INCOME $150 $100 $50 $0 11% CAGR 93 '94 '95 '96 '97 '98 '99 '00 '01 '02 '03 '04 '05 06 '07 '08 '09 '10 '11 '12 '13 '14 '15 28

Consistently Strong ROIC 1 Above Cost of Capital 5-Year Average 13% 14% 12% 12% 13% 14% WACC: 7.5% 2011 2012 2013 2014 2015 1 Return on invested capital = adjusted earnings before net interest and taxes, less tax effect / average capital (average of beginning of year and end of year capital) [capital = equity plus debt less cash]. 29

Sales Growth Analysis (2000-2015) Annual Range CAGR Low High Core 6% -7% 14% Currency 0% -12% 11% Acquisitions 1% 0% 7% Reported 7% -11% 20% 30

$ in millions Q2 2016 Results Beauty + Home SALES EBITDA MARGIN % $400 $300 $319 Reported +7% $340 16% 12% 14% 16% $200 Core 4% 8% $100 Acquisitions 5% Currency Effects (2%) 4% $0 Q2 2015 Q2 2016 0% Q2 2015 Q2 2016 EBITDA = Earnings Before Net Interest, Taxes, Depreciation and Amortization 31

$ in millions Six Months Year-to-Date 2016 Beauty + Home $800 SALES ADJUSTED EBITDA MARGIN % $600 $649 $655 Reported +1% 16% 12% 14% 15% $400 Core 1% 8% $200 Acquisitions 4% 4% $0 Currency Effects (4%) YTD 2015 YTD 2016 0% YTD 2015 YTD 2016 Adjusted EBITDA = Adjusted Earnings* Before Net Interest, Taxes, Depreciation and Amortization. * 2016 Earnings are adjusted to exclude purchase accounting adjustments related to Mega Airless inventory that were recognized in the first quarter of 2016. 32

$ in millions Q2 2016 Results Pharma SALES EBITDA MARGIN % $200 $183 $191 40% 35% 36% $160 30% $120 Reported +4% 20% $80 Core 3% $40 Acquisitions 1% 10% $0 Q2 2015 Q2 2016 0% Q2 2015 Q2 2016 EBITDA = Earnings Before Net Interest, Taxes, Depreciation and Amortization 33

$ in millions Six Months Year-to-Date 2016 Pharma SALES ADJUSTED EBITDA MARGIN % $400 $362 $374 40% 35% 35% $320 Reported +3% 30% $240 $160 Core 4% 20% $80 Acquisitions 1% Currency Effects (2%) 10% $0 YTD 2015 YTD 2016 0% YTD 2015 YTD 2016 Adjusted EBITDA = Adjusted Earnings* Before Net Interest, Taxes, Depreciation and Amortization * 2016 Earnings are adjusted to exclude purchase accounting adjustments related to Mega Airless inventory that were recognized in the first quarter of 2016. 34

$ in millions Q2 2016 Results Food + Beverage $100 $92 SALES $89 25% EBITDA MARGIN % 22% 22% $80 20% $60 Reported (3%) 15% $40 Core (1%) 10% $20 Currency Effects (2%) 5% $0 Q2 2015 Q2 2016 0% Q2 2015 Q2 2016 EBITDA = Earnings Before Net Interest, Taxes, Depreciation and Amortization 35

$ in millions Six Months Year-to-Date 2016 Food + Beverage SALES $174 $174 25% EBITDA MARGIN % $160 20% 20% 20% $120 0% Reported 0% 15% $80 Core 3% 10% $40 Currency Effects (3%) 5% $0 YTD 2015 YTD 2016 0% YTD 2015 YTD 2016 EBITDA = Earnings Before Net Interest, Taxes, Depreciation and Amortization 36

$ in millions Strong, Consistent Free Cash Flow 5-Year Average $137 Million $200 $180 $160 $140 $120 $100 $80 $60 $40 $20 $0 $175 $154 $140 $135 $81 2011 2012 2013 2014 2015 37

Statements Relating to Non-GAAP Financial Measures During the course of this presentation, certain non-u.s. GAAP financial information will be presented. A reconciliation of those numbers to U.S. GAAP financial measures is available on the company s website at www.aptar.com under Investors. 38