Q3 2012 Earnings CallPresentationOctober 26, 2012                        1
Forward-looking statementStatements in this presentation that are not historical in nature constitute forward-looking stat...
Q3 2012 summary Net Sales of $1.54 billion, 0.9% below prior year, reflecting 1.5% core sales  growth and 2.4% unfavorabl...
Q3 YTD 2012 summary Net Sales of $4.38 billion, a 0.3% increase versus prior year, reflecting a  2.2% core sales growth a...
Q3 2012: sales percent change by segment                                                  Baby &      Total               ...
Q3 YTD 2012: sales percent change by segment                                                   Baby &      Total          ...
FY 2012 outlook                                           FY 2012 Outlook*Core Sales                                      ...
Expansion of Project Renewal                               8
Expansion of Project Renewal Expansion of Project Renewal is expected to generate incremental annualized  cost savings of...
Project Renewal: Five new work streams          Organizational Simplification             EMEA Transformation             ...
Project Renewal: Expected outcomes Flatter and simplified organization with strengthened Brand and Category  Development ...
New Organizational Model                           12
Growth Game Plan   AMBITION                                                                                               ...
5 Ways to Win shape activities                         Make brands really matter                      Build an execution p...
Two capabilities of equal stature         Interdependent and Equal in Importance      Development                     Deli...
Structure follows Strategy Create new Development Organization accountable for building big brand  ideas, high-impact dis...
Six new Business Segments                  Tools           Commercial Products                 Writing            Baby & P...
New Newell Executive Team                            18
Key appointments                             30 years of management and  William A. Burke III        marketing experience...
Key appointments                               Former head of Global Corporate     Mark Tarchetti             Strategy at...
Key appointments                              25 years of experience at Newell     Doug Martin               Rubbermaid i...
Key appointments                                  Over 28 years of human resources         Jim Sweet                 mana...
Key appointments                                   Broad legal and business background     John Stipancich               ...
Key appointments                                  Over 28 years of customer       Joe Cavaliere               development...
Key appointments                                 Successfully built global design and       Chuck Jones                de...
Key appointments       Richard Davies                 Over 30 years of marketing, insightsChief Marketing & Insights Offi...
Key appointments                               Over 20 years of senior management     Gordon Steele              experien...
Appendix           28
Reconciliation: Q3 2012 andQ3 2011 “Normalized” EPS                                                         Q3 2012*      ...
Reconciliation: Q3 YTD 2012 andQ3 YTD 2011 “Normalized” EPS                                                         Q3 YTD...
Reconciliation: Full Year 2012Outlook for “Normalized” EPS                                                                ...
Reconciliation: Q3 2012 and Q3 2011 Operating Income, As Reported, to Normalized Operating Income             $ millions  ...
Reconciliation: Q3 YTD 2012 and Q3 YTD 2011 Operating Income, As Reported, to Normalized Operating Income             $ mi...
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Q3 2012 Earnings Presentation

  1. 1. Q3 2012 Earnings CallPresentationOctober 26, 2012 1
  2. 2. Forward-looking statementStatements in this presentation that are not historical in nature constitute forward-looking statements. These forward-looking statementsrelate to information or assumptions about the effects of sales, income/(loss), earnings per share, operating income, operating or grossmargin improvements or declines, Project Renewal, the European Transformation Plan, capital and other expenditures, cash flow,dividends, restructuring and restructuring-related costs, costs and cost savings, inflation or deflation, particularly with respect tocommodities such as oil and resin, debt ratings, and managements plans, projections and objectives for future operations andperformance. These statements are accompanied by words such as "anticipate," "expect," "project," "will," "believe," "estimate" andsimilar expressions. Actual results could differ materially from those expressed or implied in the forward-looking statements. Importantfactors that could cause actual results to differ materially from those suggested by the forward-looking statements include, but are notlimited to, our dependence on the strength of retail, commercial and industrial sectors of the economy in light of the continuation orescalation of the global economic slowdown or regional sovereign debt issues; currency fluctuations; competition with othermanufacturers and distributors of consumer products; major retailers strong bargaining power; changes in the prices of raw materialsand sourced products and our ability to obtain raw materials and sourced products in a timely manner from suppliers; our ability todevelop innovative new products and to develop, maintain and strengthen our end-user brands; our ability to expeditiously close facilitiesand move operations while managing foreign regulations and other impediments; our ability to implement successfully informationtechnology solutions throughout our organization; our ability to improve productivity and streamline operations; changes to our creditratings; significant increases in the funding obligations related to our pension plans due to declining asset values, declining interest ratesor otherwise; the imposition of tax liabilities greater than our provisions for such matters; the risks inherent in our foreign operations andthose factors listed in the company’s latest quarterly report on Form 10-Q and Exhibit 99.1 thereto filed with the Securities and ExchangeCommission. Changes in such assumptions or factors could produce significantly different results. The information contained in thispresentation is as of the date indicated. The company assumes no obligation to update any forward-looking statements contained in thispresentation as a result of new information or future events or developments. This presentation contains non-GAAP financial measureswithin the meaning of Regulation G promulgated by the Securities and Exchange Commission. Included in this presentation is areconciliation of these non-GAAP financial measures to the most directly comparable financial measures calculated in accordance withGAAP.INVESTOR RELATIONS CONTACTS: Nancy O’Donnell Alisha Pennix VP, Investor Relations Sr. Manager, Investor Relations (770) 418-7723 (770) 418-7706 nancy.odonnell@newellco.com alisha.pennix@newellco.com 2
  3. 3. Q3 2012 summary Net Sales of $1.54 billion, 0.9% below prior year, reflecting 1.5% core sales growth and 2.4% unfavorable foreign currency impact Gross Margin up 50 basis points versus prior year to 37.9% as pricing and productivity more than offset the negative impact of input cost inflation Normalized Operating Margin of 13.7%, flat to last year, as gross margin expansion was offset by an increase in SG&A expense attributable to the absence of certain prior year compensation-related benefits Normalized EPS of $0.47, as compared with $0.45 in the prior year Operating cash flow of $305.1 million, versus $295.3 million last year The company increased the quarterly dividend by 50% to $0.15 a share The company repurchased 1.5 million shares at a cost of $25.9 million 3
  4. 4. Q3 YTD 2012 summary Net Sales of $4.38 billion, a 0.3% increase versus prior year, reflecting a 2.2% core sales growth and 1.9% unfavorable foreign currency impact Gross Margin up 50 basis points versus prior year to 38.2% as productivity gains and pricing more than offset the effect of input cost inflation Normalized Operating Margin up 20 basis points versus prior year to 12.9% Normalized EPS of $1.27, as compared with $1.19 in the prior year Operating cash flow of $357.2 million, versus $279.8 million last year The company repurchased 3.8 million shares at a cost of $67.2 million 4
  5. 5. Q3 2012: sales percent change by segment Baby & Total Consumer Professional Parenting NetQ3 2012 Essentials SalesCore Sales (0.4) 2.5 7.8 1.5Currency Translation (1.7) (3.6) (2.6) (2.4)Net Sales (2.1) (1.1) 5.2 (0.9) 5
  6. 6. Q3 YTD 2012: sales percent change by segment Baby & Total Consumer Professional Parenting Net Q3 YTD 2012 Essentials Sales Core Sales (1.2) 4.3 11.2 2.2 Currency Translation (1.4) (2.6) (1.6) (1.9) Net Sales (2.6) 1.7 9.6 0.3 6
  7. 7. FY 2012 outlook FY 2012 Outlook*Core Sales 2% to 3%Currency Translation -1.5% to -2%Net Sales Growth 0% to 1.5%“Normalized” Operating Margin Up to +20 basis points“Normalized” EPS** $1.63 to $1.69Cash Flow from Operations $550 to $600 millionCapital Expenditures $200 to $225 million* Reflects outlook communicated in the October 26, 2012 Q3 2012 Earnings Release and Earnings Call** See reconciliation included in the Appendix 7
  8. 8. Expansion of Project Renewal 8
  9. 9. Expansion of Project Renewal Expansion of Project Renewal is expected to generate incremental annualized cost savings of $180 to $225 million when fully implemented by the end of the second quarter of 2015 Expect to incur incremental cash costs of $225 to $250 million and record pretax restructuring charges of $250 to $275 million over the same period Majority of savings reinvested to drive faster growth and geographic expansion in priority emerging markets Cumulative costs of the expanded Project Renewal are now expected to be $340 to $375 million pretax, with cash costs of $300 to $340 million Project Renewal in total is expected to generate annualized costs savings of $270 to $325 million by the end of the second quarter of 2015 The company is on track to realize annualized cost savings from first phase of Project Renewal of $90 to $100 million by the first half of 2013 9
  10. 10. Project Renewal: Five new work streams Organizational Simplification EMEA Transformation Best Cost Finance Best Cost Back Office Supply Chain Footprint 10
  11. 11. Project Renewal: Expected outcomes Flatter and simplified organization with strengthened Brand and Category Development and Execution and Delivery capabilities Accelerated release of costs, the majority of which will be invested in faster growth and the geographic expansion of our leading brands A greater line of sight to earnings and operating cash flow growth while the company invests to accelerate performance Strengthened leadership team that can drive faster implementation of Growth Game Plan 11
  12. 12. New Organizational Model 12
  13. 13. Growth Game Plan AMBITION PURPOSE Newell Rubbermaid helps people flourish every day, where they live, learn, work and play CT&A, IP&S, LABELING, NWL is a growing brand-led business with a strong home in the United WIN COMMERCIAL PRODUCTS States and global ambition BIGGER FINE WRITING BUSINESS MODEL WHERE TO PLAY Our Consumer brands win at the point of decision through excellence in WRITING & CREATIVE EXPRESSION performance, design and innovation Our Professional brands win the loyalty of the chooser by improving the WIN HOME ORGANIZATION & STYLE productivity and performance of the user WHERE CULINARY LIFESTYLES WE ARE HARDWARE We collaborate with our supplier and customer partners across the total enterprise in a shared commitment to growth and creating value INCUBATE BABY & PARENTING We deliver competitive returns to our shareholders through consistent, FOR ENDICIA, MIMIO sustainable and profitable growth GROWTH RUBBERMAID MEDICAL SOLUTIONS MAKE OUR BRANDS BUILD AN EXECUTION UNLOCK TRAPPED DEVELOP THE TEAM EXTEND BEYOND REALLY MATTER POWERHOUSE CAPACITY FOR GROWTH FOR GROWTH OUR BORDERS Sharpen brand Launch new USA Deliver European Drive performance Accelerate Latin America 5 WAYS TO WIN strategies on highest customer development Transformation, Project culture aligned to and Asia in Win Bigger impact growth levers organization Renewal savings, and business strategy Categories. working capital reduction Partner to win with Develop joint business Simplify everything to Build a more global Strategic insight customers and suppliers plans for new channel release costs for perspective and program in China penetration and growth talent base broader distribution EDGE: EVERY DAY GREAT EXECUTION 13
  14. 14. 5 Ways to Win shape activities Make brands really matter Build an execution powerhouse Unlock trapped capacity for growth Extend our boundaries Develop a growth team 14
  15. 15. Two capabilities of equal stature Interdependent and Equal in Importance Development Delivery Marketing & Insight General Management Advertising Customer Development R&D Planning Industrial Design Procurement e-Branding Building Manufacturing Public Relations Customer Service 15
  16. 16. Structure follows Strategy Create new Development Organization accountable for building big brand ideas, high-impact disruptive innovation, and a true point of difference through superior design and product experience Create new Delivery Organization accountable for P&L management and delivering the maximum commercial value from the growth ideas built by the Development Organization Create much flatter structures giving bigger roles to key leaders while driving simplification in order to focus on growth Delayer top structures eliminating two operating Groups (Consumer and Professional) and further consolidating Global Business Units from 9 to 6 reporting Business Segments New Business Segments are part of Delivery Organization 16
  17. 17. Six new Business Segments Tools Commercial Products Writing Baby & Parenting Home Solutions Specialty 17
  18. 18. New Newell Executive Team 18
  19. 19. Key appointments  30 years of management and William A. Burke III marketing experience (10 years NWL, Chief Operating Officer 20 years Black & Decker)  Previously President – Newell Professional Group and President of Lenox  Accelerated international expansion in the Professional businesses  Repositioned the Lenox brand to deliver double-digit sales growth  Businesses under his leadership have been the most significant growth contributors over the last few years 19
  20. 20. Key appointments  Former head of Global Corporate Mark Tarchetti Strategy at Unilever reporting to the Chief Development Officer Global Chief Executive Officer  Founder of international consulting firm Tarchetti & Co. Ltd.  Drove development of Growth Game Plan with top executive team  Served in variety of senior strategy, business and finance roles at Unilever for 14 years  Originally from United Kingdom 20
  21. 21. Key appointments  25 years of experience at Newell Doug Martin Rubbermaid in virtually every aspect Chief Financial Officer of corporate and operating finance  Recently appointed to serve as CFO and coordinate all of the company’s cost and cash initiatives to unlock the trapped capacity for growth  As Deputy CFO, designed roadmap for streamlining the company’s cost structure  Previously Vice President of Finance – Newell Consumer Group; Vice President of Finance – Office Products; and Treasurer 21
  22. 22. Key appointments  Over 28 years of human resources Jim Sweet management experience with diverse Chief Human Resources Officer global companies  Provided strong change management leadership and business partnering to the company’s leadership  Former President and Co-Founder of Capital H Inc., a human resource services company  Held top-level human resource roles with the Kohler Co., Keystone International and the Brady Corporation 22
  23. 23. Key appointments  Broad legal and business background John Stipancich including experience in private equityChief Legal Officer & EMEA Lead  Recently assumed responsibility for the European Team managing the company’s results in EMEA in addition to role as Chief Legal Officer and General Counsel  Previously Executive Vice President and General Counsel of Evenflo, a former Kohlberg Kravis Roberts & Co. portfolio company 23
  24. 24. Key appointments  Over 28 years of customer Joe Cavaliere development experience (8 years Global Chief Customer Officer Unilever, 20 years Kraft Foods)  Led customer development for Unilever’s $11 billion North American business  Responsible for catapulting Unilever to top 5 placement in the U.S. consumer goods industry as measured by Kantar  Responsible for transforming customer development capabilities at Kraft and Unilever 24
  25. 25. Key appointments  Successfully built global design and Chuck Jones development teams that deliver high- Chief Design and R&D Officer impact innovations at Whirlpool, Masco, Xerox and Herman Miller  Winner of prestigious Smithsonian National Design Award; named a Master of Design by Fast Company  Elected to the Academy of Fellows of the World Technology Network and the Academy of Fellows of the International Design Society 25
  26. 26. Key appointments Richard Davies  Over 30 years of marketing, insightsChief Marketing & Insights Officer and brand strategy experience  Built and led Unilever’s Global Insights function of more than 700 people in over 50 countries  Proven track record of creating brands and bringing innovation to consumers  Lived and worked in Taiwan, Korea, Japan, UK  Originally from New Zealand 26
  27. 27. Key appointments  Over 20 years of senior management Gordon Steele experience in information technology Chief Information Officer  Previously Vice President and CIO for Global Information Technology at Nike, where he led the successful implementation of SAP on a global basis  Also served in leadership capacities with Mentor Graphics Corporation, Warwick Financial Systems, US Bancorp and Fred Meyer Savings & Loan 27
  28. 28. Appendix 28
  29. 29. Reconciliation: Q3 2012 andQ3 2011 “Normalized” EPS Q3 2012* Q3 2011* Diluted earnings per share (as reported): $0.37 ($0.61) Impairment charges $0.00 $1.05 Restructuring and restructuring-related costs $0.06 $0.06 Discontinued operations ($0.01) $0.04 CEO transition costs $0.00 $0.01 Income tax - discrete contingencies, expiration of statutes of limitation and resolution of examinations $0.03 ($0.10) Loss related to the extinguishment of debt $0.01 $0.00 Other items $0.00 ($0.01) "Normalized" EPS $0.47 $0.45 * totals may not add due to rounding 29 29
  30. 30. Reconciliation: Q3 YTD 2012 andQ3 YTD 2011 “Normalized” EPS Q3 YTD 2012 Q3 YTD 2011* Diluted earnings per share (as reported): $1.02 $0.15 Impairment charges $0.00 $1.03 Restructuring and restructuring-related costs $0.18 $0.12 Discontinued operations ($0.01) $0.03 CEO transition costs $0.00 $0.01 Income tax - discrete contingencies, expiration of statutes of limitation and resolution of examinations $0.07 ($0.17) Loss related to the extinguishment of debt $0.01 $0.01 "Normalized" EPS $1.27 $1.19 * totals may not add due to rounding 30 30
  31. 31. Reconciliation: Full Year 2012Outlook for “Normalized” EPS FY 2012 Diluted earnings per share $1.27 to $1.33 Restructuring and restructuring-related costs [ 1 ] $0.27 to $0.32 Discontinued operations ($0.01) Income tax - discrete contingencies, expiration of statutes of limitation and resolution of examinations $0.07 Loss related to the extinguishment of debt $0.01 "Normalized" EPS $1.63 to $1.69 [ 1 ] Restructuring and restructuring-related costs include impairment charges, employee termination benefits and other costs associated with the European Transformation Plan and Project Renewal. 31 31
  32. 32. Reconciliation: Q3 2012 and Q3 2011 Operating Income, As Reported, to Normalized Operating Income $ millions Q3 2012 Q3 2011Net sales $1,535.3 $1,549.9Operating income (as reported) $188.4 ($192.2)CEO transition costs $- $4.4Impairment charges $- $382.6Restructuring and restructuring-related costs $22.3 $17.0Operating income (normalized) $210.7 $211.8Operating margin (normalized) 13.7% 13.7% 32 32
  33. 33. Reconciliation: Q3 YTD 2012 and Q3 YTD 2011 Operating Income, As Reported, to Normalized Operating Income $ millions Q3 YTD 2012 Q3 YTD 2011Net sales $4,383.9 $4,369.4Operating income (as reported) $498.1 $131.7CEO transition costs $- $4.4Impairment charges $- $382.6Restructuring and restructuring-related costs $66.6 $38.1Operating income (normalized) $564.7 $556.8Operating margin (normalized) 12.9% 12.7% 33 33
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