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SCA presentation at the Deutsche Bank Paper Seminar 2010

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2010-11-10, London, UK | Jan Johansson, President and CEO, SCA presented the company, growth strategies and q3 results at the Deutsche Bank Paper Seminar.

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SCA presentation at the Deutsche Bank Paper Seminar 2010

  1. 1. Deutsche Bank Paper Seminar Jan Johansson, President and CEO 10 November 2010
  2. 2. SCA Group A global hygiene products and paper company Net sales SEK 111bn 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 company 2 10 November 2010
  3. 3. SCA Group Hygiene business is growing % of net sales 100% 80% 40% 58% 60% 40% 60% 20% 42% 0% 1999 1997 2009 2008 09 Packaging and Hygiene products Forest Products 3 10 November 2010
  4. 4. SCA Group Sales and EBIT split 2009 EBIT split EBIT split Forest Products Sales split Personal Care 25% 32% 15% 23% 25% 37% 4% 39% Packaging Tissue Sales 2009: SEK 111bn 4 10 November 2010
  5. 5. Leading market positions Global and regional Nordic region Incontinence care: 1 Baby diapers: 1 North America AFH tissue: 1 AFH tissue: 3 Consumer tissue: 2 Incontinence care: 3 Europe Tissue: 1 Corrugated board: 2 Mexico Baby diapers: 3 Incontinence care: 1 Incontinence care: 1 Tissue: 2 Privately owned forests: 1 Feminine care: 3 Baby: 3 Global Incontinence care: 1 Colombia AFH tissue: 3 Australia Incontinence care: 1 Feminine care: 1 Feminine care: 1 Tissue: 1 Incontinence care: 1 Tissue: 2 5 10 November 2010
  6. 6. SCA Group Strategic Direction 6 10 November 2010
  7. 7. Growth High potential in markets with low penetration Usage of hygiene products Units/capita/year Units/child/year Units/woman/year Kg/capita/year Penetration in mature markets around 35% North America Western Europe Eastern Europe Latin America Asia 7 10 November 2010
  8. 8. Our growth markets Strong SCA positions Good market growth Favourable socio-demographics Joint venture Good market growth Favourable socio-demographics Market tests of Incontinence care products 8 10 November 2010
  9. 9. Increased pace of innovation Strengthens market positions 9 10 November 2010
  10. 10. Q3 2010 vs Q3 2009 SCA market update Significantly increased raw material prices Pulp, OCC, recovered paper Raw material costs increased SEK 1.8bn Stronger SEK to other currencies Negative sales impact of SEK 1.5bn equivalent to 6% Hygiene business Good growth for Incontinence care, Feminine care and AFH tissue Continued good growth in emerging markets Packaging and Forest Products Increased demand for Packaging • Corrugated volumes increased 4% Publication paper volumes flat Increased volumes for solid-wood products and pulp 10 10 November 2010
  11. 11. Q3 2010 results SEK millions Q3 Q3 Change, Change, Q2 unless otherwise stated 2010 2009 Q3/Q3,%* Q3/Q3,%** 2010 Net sales 27,204 27,108 0 6 27,652 EBIT* 2,574 2,576 0 2 2,440 EBIT margin* (%) 9.5 9.5 8.8 Profit before tax* 2,274 2,199 3 2,196 Earnings per share (SEK) 1.95 1.82 7 2.04 Cash flow from current operations 2,194 4,259 1,668 * Excluding restructuring cost ** Adjusted for exchange rate movements 11 10 November 2010
  12. 12. Net debt And debt payment capacity SEKm % 35% 36% 33% 33% 33% 12 10 November 2010
  13. 13. Personal Care Q3 2010 vs Q3 2009 Sales decreased 1% (+2%*) 6,125 6,197 Incontinence care increased 4%* -1% Feminine care increased 5%* Baby diapers decreased 4%* Emerging markets increased 7%* Incontinence care increased 14%* SALES SEKm Q3 2010 Q3 2009 810 EBIT decreased by 14%** (-11%***) 697** Higher volumes -14%** Higher raw material cost Increased market activities EBIT SEKm Q3 2010 Q3 2009 EBIT margin 11.4%** 13.1% * Adjusted for exchange rate movements ** Excluding restructuring costs *** Excluding restructuring costs and adjusted for exchange rate movements 13 10 November 2010
  14. 14. Tissue Q3 2010 vs Q3 2009 Sales decreased 2% (+2%*) 10,147 9,924 Consumer tissue increased 1%* -2% AFH tissue increased 4%* EBIT decreased by 32% (-31%*) Q3 2010 Q3 2009 SALES SEKm Higher raw material costs 1,102 Higher prices 753 Synergies from acquisition -32% Lower other production costs and energy costs EBIT SEKm Q3 2010 Q3 2009 EBIT margin 7.6% 10.9% * Adjusted for exchange rate movements 14 10 November 2010
  15. 15. Packaging Q3 2010 vs Q3 2009 Sales increased by 6% (24%*) 7,392 6,946 Higher prices and volumes 6% EBIT increased to SEK 512m (172)** Higher prices and volumes SALES SEKm Q3 2010 Q3 2009 Savings from restructuring program Increased raw material costs 512 Negative currency impact 197%** 172** EBIT SEKm Q3 2010 Q3 2009 EBIT margin 6.9% 2.5**% * Adjusted for the divestment of the Asian packaging business and exchange rate movements ** Excluding restructuring costs 15 10 November 2010
  16. 16. Forest Products Q3 2010 vs Q3 2009 Sales increased by 7% (8%*) 4,415 4,145 Publication papers • Lower prices 7% Pulp and Solid-wood products • Higher prices and volumes SALES SEKm Q3 2010 Q3 2009 EBIT increased by 11%** (7%***) Publication papers, decreased EBIT 685** 617 • Lower prices 11%** • Increased raw material costs Pulp and Solid-wood products, increased EBIT EBIT SEKm Q3 2010 Q3 2009 • Higher prices and volumes EBIT margin 15.5%** 14.9% * Adjusted for exchange rate movements ** Excluding restructuring costs *** Excluding restructuring costs and adjusted for exchange rate movements 16 10 November 2010
  17. 17. Outlook 2010 Hygiene businesses Good demand Seasonally weaker demand in Q4 for AFH tissue North America Full impact in Q4 of price increases in Tissue Packaging Seasonally weaker demand in Q4 Increasing prices Forest Products Good demand 17 10 November 2010
  18. 18. Q&A 18 10 November 2010
  19. 19. 19 10 November 2010

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