Handelsbanken retail and consumer seminar 2012

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Handelsbanken Retail and Consumer Seminar Johan Karlsson, Vice President Investor Relations

Transcript of Handelsbanken retail and consumer seminar 2012

Page 1: Handelsbanken retail and consumer seminar 2012

Handelsbanken Retail and Consumer SeminarJohan Karlsson, Vice President Investor Relations

Page 2: Handelsbanken retail and consumer seminar 2012

Net sales of SEK 91bn* 37,000 employees Sales in more than 100 countries Leading global hygiene company #1 or #2 positions in close to 80 countries Strong brands;

TEN and Tork are leading global billion-euro brands for Incontinence care and AFH tissue

Europe’s largest private forest owner Europe’s second-largest sawmill company Several of the world’s most prestigious

sustainability awards2 December 2012

SCA Group

* 2011 sales adjusted for closed transactions

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December 2012

Divestment of the Packaging business, excluding the two kraftliner mills Acquisition of Georgia-Pacific’s European tissue operations Acquisitions in emerging markets

Everbeauty in Asia Pro Descart in Brazil San Saglik and Komili(50%) in Turkey

Joint venture in Australia/New Zealand Divestment of Aylesford Newsprint Efficiency program Leadership and culture

Transforming SCA

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SCA Group9 months 2012 sales and EBIT by Business Area

December 2012

Forest Products

Tissue

Personal Care

48%

22%30%

Sales by Business Area

Forest Products

Tissue

Personal Care

49%

16%35%

EBIT by Business Area

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SCA GroupSales by Product Category

December 2012

Feminine care

Baby diapers73% branded

Incontinence products

31%

15%

54%

Personal Care

AFH tissue

Consumer tissue52% branded

38%62%

Tissue

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Leading Market positions Globally and regionally

North America

Incontinence products:AFH tissue:

23

Mexico

Incontinence products: 1

Feminine care: 1

Consumer tissue 2

AFH tissue: 3

Baby diapers: 3

Colombia

Incontinence products: 1

Feminine care: 1

Tissue: 1

Baby diapers 2

Nordic region

Incontinence products: 1

Baby diapers: 1

AFH tissue: 1

Consumer tissue: 2

Feminine care 2

Europe

Tissue: 1

Incontinence products 1

Baby diapers: 3

Feminine care 3

Private forest owners: 1

Solid-wood products: 2

Asia

Incontinence products: 1Globally

Incontinence products: 1

AFH tissue: 1

Consumer tissue: 2

December 2012

Value market positions

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December 2012

SCA Group’s Priorities

SUSTAINABILITY

EFFICIENCY INNOVATION GROWTH

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December 2012

EfficiencyRestructuring program in baby diapers

in Europe completed2011 Efficiency program

Annual cost saving: EUR 80m Higher machine efficiency and reduced CAPEX

Cost and productivity program Annual cost saving: EUR 300m

Georgia-Pacific synergies Annual cost saving: EUR 125m

Energy efficiency program Annual cost saving: EUR 70m

Efficiency improvements in Forest Products Investments in upgrades and new capacity8

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December 2012

Total annual cost savings: EUR 300mRelated restructuring costs: EUR 100mHeadcount reduction: approx. 1,500

Manufacturing

Sourcing

Logistics 12%

43%6%

39%

SG&A

Manufacturing Blueprint implementation Asset utilization improvements Best practice sharing

Sourcing World-class sourcing processes Leverage global scale Consolidation of suppliers

Logistics Optimize warehouse footprint Lower transportation costs Working capital management

SG&A Fewer layers in the organization Clear roles and responsibilities, no overlaps Center-led support model

Cost savings

* Excluding Georgia-Pacific acquisition

Cost and Productivity program*Key actions

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December 2012

Georgia-Pacific AcquisitionStrengthens our no.1 position

Perfect strategic fit

Substantial synergies

Strengthens our geographic presence in Europe

Strong innovation portfolio

Strengthens our branded portfolio

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Georgia-Pacific AcquisitionSynergies

Cost synergies

Supply chainSales and Marketing

Support and overhead

25%

60%15%

Supply chain synergies Manufacturing excellence and best

practice Footprint optimization Scale effects raw materials Logistics optimization

Sales and Marketing S&M organization consolidation

A&P efficiencySupport and overhead

Consolidation of support functions

December 2012

Cost synergies

Total annual cost synergies: EUR 125mRelated restructuring costs: EUR 130m

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Meet changing demands and requirements

Create long-term, profitable differentiation

Strengthen market positions

Build stronger brands

Drive growth

December 2012

Innovation drives Profitable growthStrengthens market positions and profitability

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December 2012

Global population growth

An aging population

Increased market penetration

Higher disposable income

Customers and consumers demand more comfort and sustainability

Market DriversGood growth opportunities

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December 2012

2010 2017

Personal CareTissue

Global Hygiene Products MarketIncreased penetration and aging and growing population

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December 2012

Western Europe Eastern Europe Latin America AsiaNorth America

Usage of Hygiene products

Units/capita/year Units/child/year Units/woman/year Kg/capita/year

Hygiene ProductsHigh potential in markets with low penetration

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37%

Mature markets

Emerging markets

% of Personal Care sales**

Q3 2012 Emerging markets sales growth:

Personal Care: +26%*

Tissue: +20%*

GrowthHigh growth in Emerging markets

* Adjusted for exchange rate movements** Q3 2012

16%

Mature markets

% of Tissue sales**

Emerging markets

December 201216

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Mature markets Improve profitability Increased cash flow

generation Strengthen market

positions Category expansion

Established emerging markets Profitable growth Strengthen market

positions Category expansion

SCA’s Market Priority

Not-present emerging markets Selected entry

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Financial Targets

December 2012

* Annual organic sales growth** Return on capital employed

Sales growth* ROCE**Personal Care 5-7% 30%Tissue 3-4% 15%Forest Products in line with market in top quartile

Group

Business areas

ROCE** 13%Debt/Equity 0.70Debt payment capacity above 35%

Dividend policy 1/3 of cash flow from current operations

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Johan Karlsson, VP Investor RelationsTel: +46 8 788 51 30

Louise Tjeder, Director Investor RelationsTel: +46 8 788 51 62

IR Contacts:

Email: [email protected] Website: www.sca.com