SCA presentation at Deutsche Bank Consumer Goods Conference 2011

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http://www.sca.com/ir Read and download the SCA presentation at the Deutsche Bank Global Consumer Conference in Paris. SCA speakers were CFO Lennart Persson and COO Hygiene Businesses Mats Berencreutz. http://www.facebook.com/SCA http://www.twitter.com/SCAeveryday

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SCA presentation at Deutsche Bank Consumer Goods Conference 2011

  1. 1. Deutsche Bank GlobalConsumer ConferenceLennart Persson, CFOMats Berencreutz, COO Hygiene Businesses 14 June 2011
  2. 2. HeadingSCA Subheading largestworld’s thirdhygiene company 2 14 June 2011
  3. 3. SCA GroupA global hygiene products and paper company Net sales SEK 107bn 45,000 employees and sales in more than 100 countries World’s third largest hygiene products company TEN and Tork leading global brands for incontinence care and Away-From-Home tissue Europe’s largest private forest owner Europe’s second largest packaging company3 14 June 2011
  4. 4. SCA Group Sales and EBIT split 2010EBIT split EBIT split Forest Products Sales split Personal Care 25% 29% 16% 24% 24% 36% 16% 30% Packaging Tissue 4 14 June 2011
  5. 5. SCA GroupHygiene business is growing % of net sales 100% 80% 54% 40% 60% 40% 60% 20% 46% 0% 2000 2000 2010 2010 Packaging and Hygiene products Forest Products5 14 June 2011
  6. 6. HeadingSubheading SCA supplies every 2 nd napkin to North American restaurants6 14 June 2011
  7. 7. Leading market positions Nordic regionNorth America Incontinence care: 1 EuropeAFH Tissue: 3 Baby diapers: 1 Tissue: 1Incontinence care: 3 AFH tissue: 1 Corrugated board: 2 Consumer tissue: 2 Solid-wood products: 2Mexico Baby diapers: 3Incontinence care: 1 Incontinence care: 1Tissue: 2 Privately owned forests: 1Feminine care: 3Baby diapers: 3 Australia Feminine care: 1Colombia Incontinence care: 1Incontinence care: 1 Global Tissue: 2Feminine care: 1 Incontinence care: 1Tissue: 1 AFH tissue: 3 7 14 June 2011
  8. 8. Strong global and regional brands Eastern Europe North America Europe Latin America Asia Pacific8 14 June 2011
  9. 9. SCA Group Strategic Priorities  Cost reductions in all  Efficiency programs in  Personal Care  SCA Group 5%* business areas of Packaging and Forest  Thin baby diaper SEK 1bn Products  Personal Care 2%**  TENA Ultra thins  Emerging markets 10%**  Cash flow from  Closure/Divestment  Strong TENA value current operations: of 18 packaging units assortment  Tissue 2%** SEK 7.4bn  Emerging markets 6%**  Supply chain  Tissue excellence and asset  Tork Xpressnap  Packaging 20%* utilization programs in Café Tissue Europe  Tork Performance  Forest Products 3%**  Tempo ice  Restructuring program in Baby diapers in  Packaging Europe  Trueflo  New tissue plant in  ZeoCool Mexico  Forest Products  New Personal Care  Increased value plant in Russia added* Adjusted for exchange rate movements, divestments and closures* *Adjusted for exchange rate movements 9 14 June 2011
  10. 10. GrowthSCA’s growth markets Latin America  Strong SCA positions South East Asia  Good market growth  Favourable socio-demographics Eastern Europe /Russia  Good market growth Middle East  Favourable socio-demographics China  Incontinence care products10 14 June 2011
  11. 11. Q1 2011 resultsSEK millions Q1 Q1 Change, Change, unless otherwise stated 2011 2010 % %**Net sales 25,393 26,199 *** -3 6 ****EBIT* 2,112 2,027 4 10EBIT margin* (%) 8.3 7.7Profit before tax* 1,810 1,748 4 10Earnings per share (SEK) 1.89 1.53 24Cash flow from current operations 353 1,148Debt/Equity ratio 0.49 0.57* Adjusted for Packaging restructuring costs in 2010** Adjusted for exchange rate movements*** Net sales from SCA recycling business have been reclassified to other income with retroactive adjustment from 2010**** Adjusted for exchange rate movements and divestments11 14 June 2011
  12. 12. Outlook 2011 Good demand for all businesses Good growth in Emerging markets for Hygiene businesses Continued high raw material costs Increasing corrugated prices Price increases for Personal Care, Tissue and publication papers during H212 14 June 2011
  13. 13. Personal care Initiatives 2010  Restructuring program in baby diapers in Net sales 2010: Europe  Annual savings of EUR 15m with full effect SEK 25bn in Q3 2011  Investment in local production in Russia  Acquisition of Copamex baby diapers business  No. 3 in Mexico Feminine care Incontinence care  Growth 17% 56%  TENA has increased market share  Incontinence care products in China expanded  Feminine care products launched in Malaysia and tampons in Sweden and the Netherlands  Extended range of Libero baby care products  Emerging market sales increased 10%* Baby diapers 27%  Innovation  TENA Ultra thins  Thin baby diaper  Strong TENA value assortment* Adjusted for exchange rate movements 13 14 June 2011
  14. 14. Personal CareInnovations strengthens market positions14 14 June 2011
  15. 15. Personal Care Good growth opportunities Usage of hygiene products Units/capita/year Units/child/year Units/woman/year Kg/capita/yearPenetrationin maturemarketsaround 35% North America Western Europe Eastern Europe Latin America Asia 15 14 June 2011
  16. 16. Personal Care TENA a true success story Annual sales growth 1990-2010: 9%Emerging markets EURm North DesignAmerica 1,400 Internet 1,200 TVSouth 1,000Europe Retail 800 Reimbursement 600 NorthEurope 400 200 0 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 New products & services 16 14 June 2011
  17. 17. Personal CareSustainability as a business driver Growth potential in emerging markets  More people can afford hygiene products – and they prioritize it  Smaller packs, local distribution and value products in Latin America, Africa and Asia  Cooperation with Wal-Mart’s Bodega Aurrera stores in Mexico17 14 June 2011
  18. 18. Tissue Initiatives 2010  Implementation of price increases Net sales 2010:  Investment in new tissue plant in Mexico SEK 40 bn  European brand migration project Consumer  Growth tissue  Tork has gained market share in Europe 62% and North America  Emerging market sales increased 6%*  Innovation  Tork Xpressnap Café  Tork Performance AFH-tissue  Tempo Ice 38%  Tempo Kids  Tempo toilet tissue* Adjusted for exchange rate movements 18 14 June 2011
  19. 19. TissueInnovations strengthens market positions19 14 June 2011
  20. 20. TissueSustainability as a business driver Increased customer demand, both from consumer and B2B Several tenders secured thanks to green credentials, i.e. Starbucks, Wembley stadium and McDonalds Increased demand for eco-labelling  90 Tork products received the EU Eco-label in 2010 Other labels such as the Green Seal, EcoLogo, Die Blaue Engel20 14 June 2011
  21. 21. TissueStronger brands and more efficient A&P Complicated, region specific, Focused, differentiated & consumer inefficient brand portfolio relevant mega-brand portfolio DACH East Nordic NL From … … To21 14 June 2011
  22. 22. Tissue Good growth opportunities in emerging markets Usage of hygiene products Units/capita/year Units/child/year Units/woman/year Kg/capita/yearPenetrationin maturemarketsaround 35% North America Western Europe Eastern Europe Latin America Asia 22 14 June 2011
  23. 23. TissueInvestments New tissue machine, New tissue machine, Germany Russia  Start-up 2013  Start-up 2013  Capacity: 60,000 tonnes  Capacity: 60,000 tonnes  Primarily AFH tissue  Investment: SEK 1.2bn products  Investment: SEK 1.1bn Increases capacity, efficiency and profitability23 14 June 2011
  24. 24. Q&A24 14 June 2011
  25. 25. IR Contacts: Johan Karlsson, VP Investor Relations Jessica Ölvestad, Manager Investor Relations Tel: +46 8 788 51 30 Tel: +46 8 788 52 82 Email: ir@sca.com Website: www.sca.com25 14 June 2011

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