Wessanen Q1 2013 roadshow ppt


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Royal Wessanen Q1 2013 result presentation for analysts, investors and media; Dutch quoted company, mainly active in organic food with wellknown brands such as Bjorg, Bonneterre, Evernat, Allos, Tartex, Kallo, Clipper and Zonnatura

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Wessanen Q1 2013 roadshow ppt

  1. 1. Royal WessanenA leading player in organic food in EuropeQ1 2013 roadshow presentationUpdated 26april 2013www.wessanen.com @RoyalWessanen
  2. 2. In a nutshellA leading European organic food player• Own operations in Benelux, France, Germany, Italy, UK + export operations• Pioneering brands | indulgence & nutritional• Well-managed supply chain | Strong focus on quality, innovations, brands• Factories in UK (tea), Germany (vegetable spreads) (cereals/bars/spreads/honey) and Italy(soy/non-dairy drinks)• Turnover €711mln (2012) | 2,064 employees (on average)Organic food market• Attractive part of food market | growing | low per capita consumption | €22bn market• No colouring/flavouring | GMO-free | no artificial fertilisers | animal health• Unique certification system | grown and processed according to EU regulation2
  3. 3. 3Portfolio approach  focus on organic food332009 2012€711mFocus and investment into core brands &categories in organic in EuropeGroceryHFSIZICOABCOthers€1585m
  4. 4. What is organic?!Strict criteria to be allowed to be labelled organicDemonstrably free from GMO, pesticides and growth hormonesStrict rules on animal welfareSevere restrictions on fertilisers, herbicides and pesticidesSevere restrictions on additives and processing aidsAll about being produced and processed in line with organic principlesOrganic products promote health and well-beingHolding benefits for the planet and for future generationsAll about nutrition and taste !Organic food is controlled by a unique European certification systemAt Wessanen, our vision is to make our organic brands most desired inEurope4
  5. 5. 5Nutrition and food issues TransparencySustainability Weight and obesityORGANIC
  6. 6. Our vision is to build the most desired brandsin Europe in our focus area6HealthynutritionEthicalsustainableAuthentictasteFunctionalfood
  7. 7. Strategic objectives7Sales growth• Grow core brands• Grow core categories• Build strongholds in new markets• Country specific growth strategies• Launch fewer, bigger, betterinnovations• Execute acquisitions shortlistProfitabiltyimprovement• Central sourcing savings• Pricing strategies towardscustomers• Improve operational excellencewith SAP• Filling own factoriesEnablers• Improve talent performancemanagement / buildingconnected leadership• Simplify how we are conductingbusiness• Activate Organic ExpertiseCentre (OEC), integrate QualityWessanen 2015A more integratedconsumer and customer driven organisation,being focussed, less complex, more efficient and integrated
  8. 8. Transformation programme ‘Wessanen 2015’1. Create more focus on our activities• Reduction of approx. 300 FTE• Expected one-off costs €(21) mln cash and €(7.0) mln non-cash impairment Deurne plant• Expected savings €15 mln p.a. from 2014 onwards3. Addressing low-yielding and non-performing activities• Strongly reducing German grocery presence, changing go-to-market approach• Focus in Italian grocery on non-dairy (soy)2. Reduce complexity and simplify processes• Cutting the tail / reducing number of SKUs at− Dutch brands; French HFS brands; Export• Centralising quality department• In the Netherlands, focus on one franchise formula (Natuurwinkel), to end GooodyFooods formula• Supply chain to manage our plants as of 2013 and to streamline processes• Further increased focus on core brands and core categories• Expansion number of CBTs (category brand teams)• Split in branded and distribution organisation− Benelux operations− French HFS operations
  9. 9. Net debt / Leverage ratio0255075100Q1 11 Q2 11 Q3 11 Q4 11 Q1 12 Q2 12 Q3 12 Q4 12 Q1 130123Q1 11 Q2 11 Q3 11 Q4 11 Q1 12 Q2 12 Q3 12 Q4 12 Q1 139Net debtLeverage ratio€63 mln1.7xIn € mln
  10. 10. A very sound financial positionIn € mln Mar 13 Dec 12 *RestatedNon-current assets 152.7 154.5Current assets 214.4 183.4TOTAL ASSETS 367.1 337.910In € mln Mar 13 Dec 12 *RestatedDec 12ReportedTotal equity 115.8 110.8 101.6Non-current liabilities 20.3 81.0 90.2Current liabilities 231.0 146.1 146.1Total liabilities 251.3 227.1 236.3TOTAL EQUITY & LIABILITIES 367.1 337.9 337.9*Restated for IAS19R
  11. 11. Q1 2013 key figuresIn € mln Q1 2013 Q1 2012Revenue 172.5 170.6Autonomous growth (1.0)%Normalised EBIT 9.3 2.9As % of revenue 5.4% 1.7%Exceptional costs (1.1) -EBIT 8.2 2.9Net result, attributable to equity holders 5.1 1.7Earnings per share (EPS) 0.07 0.0211EBIT improvementGross profit Operating costs Marketing spending 
  12. 12. Q1 2013 performance• We have to cope with uncertain economic times, deteriorating consumerconfidence and increased unemployment• Consumer appreciation for healthy and nutritional food is continuously growing– Consumers are gradually incorporating more of a sustainable agenda whenmaking food purchases– Consumers show growing engagement with organic food• Execution of ‘Wessanen 2015’ running smoothly– A transformational programme to become a more profitable company– €(0.9) mln of costs incurred; cumulative costs €(17.2) mln– Total costs (with a cash effect) of €(21) mln expected– Savings of €15 mln expected from 2014 onwards12
  13. 13. Q1 2013 performance (cont’d)• Grocery continues to show healthy performance– Most core categories showing growth– Our brands (e.g. Bjorg, Clipper, Whole Earth) performing well– Volume impacted by• Lower private label sales in UK and Italy• Withdrawal from low-yielding German and Italian grocery activities• Positive signs visible at Health Food Stores, such as– First indications of restructuring and refocus Bonneterre encouraging– Allos growing sales, benefiting from its new positioning and innovations– Benelux showing growth at existing formula and independent stores– The Benelux operations to be split in branded and wholesale/distributionbusinesses to increase focus13Q1 revenue30%41%13%16%Grocery HFS IZICO ABC
  14. 14. Strong growth driven by• Brand support (TV/360°)• In-store & consumer activation• Innovation14
  15. 15. • First TV commercials since 2007• A challenger to all conventional food brands
  16. 16. 16• 11% growth in the UK• Integration in UK on plan• Roll-out Europe- France: Q1- Netherlands: Q2- Germany: Q3
  17. 17. 17• New positioning andCommunication• New range fromMarch 2013
  18. 18. France Alter Eco – leading in French fairtrade• Sale and purchase agreement signed– Closing expected early June, depending on satisfaction certain closing conditions• France Alter Eco– Paris-based– Revenue 2012 of €16.5 mln– Organic and fair trade products such as chocolate, coffee, tea and juices– Developed strong partnerships with farmers’ cooperatives– Around 100 products• Marketed in grocery, HFS and out-of-home channels– Multiple paid 0.2-0.3x revenue18
  19. 19. Q1 2013 performance (cont’d)• IZICO making good progress in becoming one company– Deurne plant has been closed per end of March– New structure and roles at various departments are being implemented– Autonomous revenue up: retail growing, out-of-home impacted by sluggish demand– Beckers and Bicky performing in line with expectations• At ABC , Daily’s maintained its market share, despite lower volumes– Pouches line expanded with 6 new flavours• 3x Tropical and 3x light, now totalling 13– Little Hug continues to grow, gaining market share– New campaign launched19
  20. 20. Retailer Support64th of July promotion
  21. 21. Appendices21
  22. 22. Attractiveness organic food marketsEuropean organic food an attractive, growing segment– Size €21 bn; 2011 growth around 6%– <3% of total European food marketIncreasing consumer appreciationStill low per capita consumption– European Union €30 per annumConsumers increasingly convinced of benefits of organic foodregarding health, taste and environmentGrocery and Health Food Stores channels developing atdifferent growth path22
  23. 23. Wessanen business principles• Compliance with laws: being a responsible partner in society,acting with integrity towards all stakeholders and others whocan be affected by our activities• Environment: in line with commitment to sustainabledevelopment, we will do all that is reasonable and practicable tominimise adverse effects on the environment• Product safety: we aim at all times to supply safe productsand services• Free market competition: we support free marketcompetition as basis of conducting business; we observeapplicable competition laws and regulations• Child, bonded and forced labour: under no circumstances weare making use of forced or bonded labour; we do not employchildren in violation of relevant conventions of ILO• Human rights: we support and respect human rights andstrive to ensure that our activities do not make it an accessoryto infringements of human rights23We expect suppliers and business partners to comply with the above principles
  24. 24. Wessanen’s supply chain24
  25. 25. Palm oil - member RSPO• Palm oil is important, versatile raw material for food– Only be cultivated in tropical areas of Asia, Africa and South America– Concerns that demand causing expansion of plantations into eco-sensitive areas• Since March 2011 Member of Roundtable on Sustainable Palm Oil (RSPO)– Global multi-stakeholder initiative– Encouraging sustainable production/use palm oil– Wessanen commits to organisation’s objectives• In 2011, we developed policy to govern palm oil sourcing and guidelines for implementation inpartnership with our suppliers• Committed to switching palm oil to RSPO certified sustainable palm oil during 2012-13– RSPO certified segregated palm oil for organic– GREEN PALM certificates for conventional25
  26. 26. Organic Expertise Centre (OEC)• Establishment internal expertise center - named OEC - in 2010 To stimulate exchange of knowledge / experience that is widely availablewithin Wessanen To educate and inspire our internal / external stakeholders in organic values• Specialists join forces and work on pan-European issues• To legitimise our position in organic world by championing the organic case• Focal areas will be: Training (incl. training package for newcomers) Knowledge building by teaming up with external researchers and experts Lobbying to promote organic food Communication for more general awareness / knowledge of organic food26
  27. 27. A long and rich history 1765 - Incorporated around river De Zaan– Adriaan Wessanen started to trade in mustard, canary and other seeds Around 1910 introducing first consumer products such asoatmeal and cocoa 1913 - Distinguished title Royal (99 years !) 1959 - Listed on Euronext Amsterdam 2009 - Strategic reorientation  focus on organic food in Europe 2012 - To make our organic brands most desired in Europe• 2015 - Marking 250th anniversary of Wessanen27
  28. 28. 2012 overviewRevenue273205113129Grocery HFS IZICO ABCEBIT before exceptionals22,00,01,86,3Grocery HFS IZICO ABCFTEs (average)43463048745162Grocery HFS IZICO ABC CorporateAverage Capital Employed895937487Grocery HFS IZICO ABC Corporate28€711mln €19mln*2,064 €240mln* Incl. non-allocated* Incl. intercompany sales*
  29. 29. Q1 figures per segmentIn € mln Revenue Normalised EBITQ1 13 Q1 12 Q1 13Grocery 70.9 66.4 HFS (Health Food Stores) 52.8 53.9 IZICO 28.2 27.8 ABC 22.5 24.7 Non-allocated (1.9)* (2.2)* Wessanen 172.5 170.6 29* Eliminations for inter-segment revenue (between Grocery and HFS)
  30. 30. Revenue breakdown per segment52,853,93022,524,7(1.5)%Health Food Stores Autonomous third party revenue growth70,966,41.7%Grocery Autonomous third party revenue growth28,227,81.4%IZICO Autonomous third party revenue growth(9.9)%ABC Autonomous third party revenue growth
  31. 31. Financials Q1 / guidance 2013Financials Q1• Net financing costs €(0.4) mln Q1 2012: €(0.6) mln (restated)• Income tax expenses €(2.7) mln Q1 2012: €(0.8) mlnGuidance FY2013• Net financing costs €(2-3) mln• Effective tax rate around 35%• Capex €8-10 mln• Depreciation and amortisation €14 mln• Non-allocated expenses (incl. corporate) €11 mlnRevised IAS 19 – impact on FY 2012 / yearend 2012• €0.5 mln higher personnel expenses• €1.1 mln lower net financing costs• Equally distributed over all four quarters• Equity (‘OCI’) €9.0 mln higher as at yearend 201231
  32. 32. Royal WessanenA leading player in organic food in Europe