SCA's presentation at the Handelsbanken Basic Industry Seminar, 2010-03-11

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SCA's President and CEO Jan Johansson speaking at the Handelsbanken Basic Industry Seminar in Stockholm, Sweden March 11, 2010.

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SCA's presentation at the Handelsbanken Basic Industry Seminar, 2010-03-11

  1. 1. Handelsbanken Basic Industry Seminar 11 March 2010 Jan Johansson, President and CEO 11 March 2010
  2. 2. SCA – a global hygiene products and paper company Net sales of SEK 111bn Approximately 50,000 employees and sales in more than 100 countries TEN and Tork leading global brands for incontinence care and Away From Home tissue Ranked 2nd greenest company in the world, one of the world’s 100 most sustainable companies and one of the world’s most ethical companies, included in the Dow Jones Sustainability indexes 2 11 March 2010
  3. 3. 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 3 11 March 2010
  4. 4. Strong global and regional positions Nordic region Baby diapers: 1 North America Europe AFH tissue: 3 Tissue: 1 Incontinence care: 3 Corrugated board: 2 Baby diapers: 3 Incontinence care: 1 Mexico Privately owned forests: 1 Hygiene products: 2 Global Incontinence care: 1 Colombia AFH tissue: 3 Incontinence care: 1 Australia Feminine care: 1 Feminine care: 1 Tissue: 1 Incontinence care: 1 Tissue: 2 4 11 March 2010
  5. 5. SCA short and mid term strategic focus 5 11 March 2010
  6. 6. SCA Group Strategic Direction 1. 2. 3. 6 11 March 2010
  7. 7. SCA Group Strategic direction 3. Initiatives 1. 2. Cost reductions in all Rationalized supply Tissue business areas of chain in Packaging Tork elevation close to SEK 1bn and Tissue Tempo complete care Plenty active wipe Green field tissue Cash flow from plants in Russia and Personal Care Mexico Stretch diaper upgrades current operations: Tampons increased SEK 7.7bn Efficiency programs in Baby care products Packaging & Forest Packaging Products Mira System Tissue packaging solutions Forest Products New paper qualities Increased value added 7 11 March 2010
  8. 8. Coping recession Net sales and Operating profit SEKm SEKm ** *** * *Excluding SEK 439m Packaging restructuring costs **Excluding SEK 387m Packaging restructuring costs ***Excluding SEK 632m Packaging restructuring costs 8 11 March 2010
  9. 9. SCA Group Strategic Direction 1. 2. 3. 4. 9 11 March 2010
  10. 10. 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 10 11 March 2010
  11. 11. 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 and Baby diapers 11 11 March 2010
  12. 12. Growth High growth in Emerging markets 2009 Emerging markets hygiene sales growth: Personal Care: +13% Tissue: +6% % of Hygiene sales in 2009 Emerging markets 25% Mature markets 12 11 March 2010
  13. 13. SCA Group Strategic Direction Personal Care Short and mid term Maintain Tena leadership in premium segment and increase growth in economy segment Strengthen leading positions in Europe Further restore Baby diapers private label profitability Drive innovation Market test in China Grow in prioritized Emerging markets Increase value added and branded 13 11 March 2010
  14. 14. SCA Group Strategic Direction Tissue Short and mid term Strengthen leading positions in Europe Further restore Consumer Tissue profitability Drive innovation Grow in prioritized Emerging markets Increase value added and branded 14 11 March 2010
  15. 15. Brand strategy Consumer Tissue Europe Complicated, region specific, Focused, differentiated & consumer inefficient brand portfolio relevant mega-brand portfolio DACH East Nordic NL From … … To 15 11 March 2010
  16. 16. SCA Group Strategic Direction Packaging Short and mid term Deliver restructuring program Effectively address cost and efficiency improvement needs Divest non-core assets Grow value added 16 11 March 2010
  17. 17. Packaging restructuring program Current status Closed New Hythe testliner mill Closed 11 corrugated units Employee reduction: approx. 1,500 of 2,200 Costs: SEK 1,458m of SEK 1.7bn Annualized savings: approx. 60% of SEK 1,070m Full savings Q2 2010 17 11 March 2010
  18. 18. SCA Group Strategic Direction Forest Products Short and mid term Continued focus on productivity and efficiency Explore opportunities to expand pulp capacity Grow value added and branded Commercialize renewable energy Explore alternative areas of fiber use 18 11 March 2010
  19. 19. Increasing raw material prices February 2009 – USD 585 NBSK pulp February 2010 – USD 850 OCC February 2009 – EUR 37 February 2010 – EUR 93 950 USD/metric ton USD/Metric tonne EUR / ton 925 EUR/t 120 900 875 110 850 825 800 100 775 750 90 725 700 80 675 650 70 625 600 575 60 550 525 50 500 475 40 450 425 30 400 -98 -99 -00 -01 -02 -03 -04 -05 -06 -07 -08 -09 -10 -07 -08 -09 -10 OCC PIX NBSK PIX Value Recovered paper - USA February 2009 – USD 166 USD/short ton February 2010 – USD 277 450 USD/short ton 400 350 300 250 200 150 100 50 0 -93 -94 -95 -96 -97 -98 -99 -00 -01 -02 -03 -04 -05 -06 -07 -08 -09 High grade deinking OCC 19 11 March 2010
  20. 20. Outlook 2010 Hygiene businesses Stable demand Good growth in emerging markets Packaging Demand improvement, but weak start Increasing prices Forest Products Low demand and decreasing prices for publication paper Improvement for pulp and solid-wood products 20 11 March 2010
  21. 21. Q&A 21 11 March 2010
  22. 22. 22 11 March 2010

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