RPC Group Plc reported its 2013/14 results. Key points included: - Revenue increased 6.6% to £1,046.9 million due to organic growth and acquisitions. - Adjusted operating profit rose 9.7% to £101.3 million. - The company continued executing its Vision 2020 strategy of focused growth through acquisitions like M&H Plastics (UK), Helioplast (Bosnia), and Ace (China post-year end).

1. RPC Group Plc
2013/14 Results
Bringing packaging to life
RPC GROUP PLC
2013/14 results 04 June 2014

2. RPC Group Plc
2013/14 Results
AGENDA
2
•
Vision 2020 PV
•
Business Review PV
•
Fitter for the Future SK
•
Financial Review SK
•
Outlook PV

3. RPC Group Plc
2013/14 Results
Focused growth
Continuing focus on organic growth
Selective consolidation in Europe
Creating a meaningful presence outside Europe
● Further growth in the selected markets
● 4% organic sales increase
3
VISION 2020: FOCUSED GROWTH PROGRESS
●
Acquisition of M&H Plastics
●
Acquisition of Helioplast
●
Continuing pipeline of opportunities
●Investment in organic growth in the US
●Acquisition of M&H containing US operation
●Acquisition of Ace (China) post year end

4. RPC Group Plc
2013/14 Results
M&H Plastics
●
Purchasing synergies realised
●
Sales integration with Manuplastics completed
●
Further growth in the UK
●
Roll out of M&H business model in preparation
BUSINESS REVIEW ACQUISITIONS – INTEGRATION UPDATE
4
Helioplast
●
Fully integrated into the Superfos cluster
●
New machines and product lines allocated
●
Increasing RPC presence in Balkans

5. RPC Group Plc
2013/14 Results 5
BUSINESS REVIEW ACQUISITIONS – ACE
Production facilities and headquarters
Sales by destination 2013
Factory location
Production facilities
Production site
Headquarters
Shanghai
Hefei
Shanghai

Employs c.600 people

Established in 2003
Hefei

Employs c.330 people

Established in 2013
Shenzhen (Gonghe)

Employs c.1,100 people

Established in 1997
Shenzhen (Shatou)

Employs c.610 people

Established in 1997
Zhuhai

Employs c.630 people

Established in 2008
Green Arburg machines
5 axis robots
Electroplating plant
HPH automation plant
HPH automation plant
Clean room moulding
Zhuhai
Hong Kong
Shenzhen
(Shatou)
Shenzhen
(Gonghe)
13%
19%
30%
38%
Rest of the World
China
Europe
Americas
Ace has additional sales offices in the UK and the US
Ace has presence across China through five manufacturing facilities

6. RPC Group Plc
2013/14 Results 6
BUSINESS REVIEW ACQUISITIONS – ACE: STRATEGIC RATIONALE
Platform to create a meaningful presence in Asia
Enhance Ace’s attractive standalone growth strategy
●
High quality, modern manufacturing platform
−
Critical mass and capacity to grow higher added value packaging volumes in Asia
●
Leverage RPC’s relationships with global customers calling for RPC to have a manufacturing presence in China
●
Platform to accelerate acquisitive growth in the region
●
Synergy opportunities:
−
Cost savings from increased in-sourcing of existing RPC tooling requirement
−
Potential for general purchasing savings for enlarged group
●
Enhanced export sales for Ace through the RPC sales network
●
Increased value offering for European tools through the support of a dedicated service tool centre
●
Best practice transfer to Ace – complex moulding, automation, multi-part assembly
Bilateral discussions between Ace and RPC relating to a potential combination were on-going for circa three years

7. RPC Group Plc
2013/14 Results
BUSINESS REVIEW MARKET DEVELOPMENTS – GROWTH ON TRACK
7
MARKET SEGMENT
ACTIVITY LEVELS
COMMENT
Personal care & cosmetics

Acquisition of M&H strengthening position
Spreads & dairy

Stable market with trend continuing towards “In-Mould-Label” Injection moulding
Single serve beverage systems

Continued strong growth in capsules for single-serve beverage systems
Surface coatings

Signs of the Spanish economy recovering
Pharmaceutical

Promising pipeline of new projects
Other food

Stable market providing satisfactory returns
Other non-food

Healthy growth in chemicals
7%
7%
10%
11%
20%
Other food
Long
shelf-life
Single serve beverage systems
Spreads
Dairy
products
Food 55%
4%
9%
15%
17%
Other
non- food
Pharmaceutical
Personal care and cosmetics
Surface
coatings
Non- Food 45%
33% of Group sales in High Added Value products

8. RPC Group Plc
2013/14 Results
Polymer price development
BUSINESS REVIEW POLYMER PRICE DEVELOPMENT
PP polymer Supply/Demand
78% 80% 82% 84% 86% 88% 90% 92% 01530456075900809101112131415161718
TONNES (M)
OPERATING RATE %
Source: Chemical Market Associates, Inc.
8
Operating Rate
Actual Demand
Free Capacity
Forecast Demand
€ PER TONNE
Source: Platts / ICIS
HDPE BM
PP HOMO
400
600
800
1,000
1,200
1,400
1,600
Stable polymer prices in financial year 2013/14

9. RPC Group Plc
2013/14 Results
FITTER FOR THE FUTURE UPDATE
9
Programme main work streams:
Rationalise manufacturing footprint
Optimise existing business portfolio
Review of business portfolio
●
Intended divestment of Cobelplast cluster
●
Sale of disposable trading business
●
Nordic region - merger of Tenhult into Mullsjö
●Merge French dairy operations
●Refocus Spanish operations
●Realise value of redundant properties
Programme contents:
●
Optimisation programme Blow Moulding cluster
●
Optimisation programme Bramlage-Wiko cluster
●
Optimisation of cluster overhead
Update:
●Initial offers received, progressing with preferred bidders
●Sold 22nd May 2014 for €3m
●Project on plan
●Production at Troyes ceased in March 2014
●Closure of San Roque in progress
●3 properties sold in the year
●Update of organisation structure & market approach
●Realigning production concepts in progress
●Completed

10. RPC Group Plc
2013/14 Results
FITTER FOR THE FUTURE UPDATE
10
Total project cost
2
9
14
16
17
12/13
13/14
14/15
15/16
16/17
Estimated cumulative EBIT impact of programme (£m):
Incurred to date
Costs remaining
£58m
£12m
Total
project cost:
£70m

11. RPC Group Plc
2013/14 Results
FINANCIAL REVIEW KEY FIGURES
11
21.1p
30.0p
38.2p
36.9p
41.1p
09/10
10/11
11/12
12/13
13/14
40.9
56.0
95.5
91.6
101.3
09/10
10/11
11/12
12/13
13/14
Adjusted basic EPS*
For continuing operations
Adjusted = before restructuring costs, impairment losses, amortisation of acquisition intangibles and pension administration expenses
* Restated following Rights Issue in 2011
Adjusted operating
profit (£m)
Revenue (£m)
661
752
1,056
982
1,047
09/10
10/11
11/12
12/13
13/14

12. RPC Group Plc
2013/14 Results
FINANCIAL REVIEW KEY FIGURES
12
8.4p
11.5p
14.4p
14.9p
15.5p
09/10
10/11
11/12
12/13
13/14
14.1%
16.7%
23.9%
22.6%
24.5%
Mar 10
Mar 11
Mar 12
Mar 13
Mar 14
65
69
100
86
105
09/10
10/11
11/12
12/13
13/14
Net cash from
operating activities (£m)
Dividend per share
Return on
net operating assets
Restated following Rights Issue in 2011
For continuing operations

13. RPC Group Plc
2013/14 Results
FINANCIAL REVIEW CASHFLOW BRIDGE (£m)
13
* Includes discontinued operations, exchange rate movements, provision movements, one off pension deficit payments & movement on derivatives
Net Debt
Mar 2014
EBITDA
Working
Capital
Interest
& Tax
Investing Activities
Dividends
Other*
Net Debt
Mar 2013
Exceptional Spend
Acquisitions
(171)
(266)
145
(20)
(71)
(24)
(25)
(111)
(5)
16

14. RPC Group Plc
2013/14 Results
FINANCIAL REVIEW FINANCIAL POSITION
14
KPIs
MAR 2014
Net debt (£m)
266
Undrawn facilities (£m)
391*
Net debt to EBITDA ratio
1.7x
0
50
100
150
200
250
300
350
400
2014
2015
2016
2017
2018
2019
2020
2021
Renewal date main facilities
USPP
USPP
Term
£m
RCF – New April 2014
* Recalculated using new £350m RCF

15. RPC Group Plc
2013/14 Results
OUTLOOK
15
Vision 2020 strategy delivered platforms for further growth in Asia, US and South East Europe
Financial year started in line with management expectations
Further acquisition opportunities being explored
Fitter for the Future benefits being delivered

16. RPC Group Plc
2013/14 Results
FORWARD LOOKING STATEMENTS
16
This presentation contains forward-looking statements, which:
•
have been made by the directors in good faith based on the information available to them up to the time of their approval of this presentation; and
•
should be treated with caution due to the inherent uncertainties, including both economic and business risk factors, underlying such forward-looking information.
•
The Group undertakes no obligation to update these forward-looking statements and nothing in this presentation should be construed as a profit forecast.

17. RPC Group Plc
2013/14 Results
SUPPLEMENTARY MATERIAL 17

18. RPC Group Plc
2013/14 Results
FINANCIAL REVIEW CONSOLIDATED INCOME STATEMENT
£ million
2013/14
2012/13
Variance
Revenue
1,046.9
982.3
64.6
Operating profit – adjusted
101.3
91.6
9.7
Interest charge
(11.8)
(11.7)
(0.1)
Profit before tax – adjusted
89.5
79.9
9.6
Tax on adjusted profit before tax
(21.5)
(19.1)
(2.4)
Profit after tax – adjusted
68.0
60.8
7.2
Exceptional items – restructuring and impairments
(26.7)
(28.4)
1.7
Amortisation of acquired intangibles, pension administration expense and employee benefit net finance expense
(3.8)
(3.3)
(0.5)
Tax relief on above items
6.2
4.9
1.3
Profit after tax – reported
43.7
34.0
9.7
Basic earnings per share (p) – adjusted
41.1p
36.9p
4.2p
Basic earnings per share (p) – reported
26.5p
20.6p
5.9p
18
For continuing operations

19. RPC Group Plc
2013/14 Results
FINANCIAL REVIEW SEGMENTAL ANALYSIS - IFRS 8 BASIS
£ million
2013/14
2012/13
Variance
Injection Moulding
Revenue*
692.4
628.3
64.1
Operating profit **
70.1
63.7
6.4
Return on sales **
10.1%
10.1%
-
Return on net operating assets **
26.8%
25.5%
1.3%
Thermoforming
Revenue*
182.0
184.1
(2.1)
Operating profit **
19.1
17.1
2.0
Return on sales **
10.5%
9.3%
1.2%
Return on net operating assets **
34.9%
30.2%
4.7%
Blow Moulding
Revenue*
172.5
169.9
2.6
Operating profit **
12.1
10.8
1.3
Return on sales **
7.0%
6.4%
0.6%
Return on net operating assets **
20.7%
19.0%
1.7%
For continuing operations
* External sales only
** Based on adjusted operating profit before restructuring costs and impairment losses, amortisation of acquired intangibles and pension administration expense
19

20. RPC Group Plc
2013/14 Results
FINANCIAL REVIEW SEGMENTAL ANALYSIS - GEOGRAPHICAL
£ million
2013/14
2012/13
Variance
UK
Revenue*
269.8
234.4
35.4
Operating profit**
29.9
22.6
7.3
Return on sales**
11.1%
9.6%
1.5%
Mainland Europe (including USA)
Revenue*
777.1
747.9
29.2
Operating profit**
71.4
69.0
2.4
Return on sales**
9.2%
9.2%
-
20
For continuing operations
* External sales only
** Based on adjusted operating profit before restructuring costs and impairment losses, amortisation of acquired intangibles and pension administration expense

21. RPC Group Plc
2013/14 Results
FINANCIAL REVIEW CONSOLIDATED BALANCE SHEET
£ million
MAR 2014
MAR 2013
Property, plant and equipment
418.0
395.3
Goodwill
169.8
93.1
Other non-current assets
37.3
33.1
Working capital
32.0
37.8
Employee benefit liabilities (LT)
(72.5)
(62.7)
Other assets & liabilities
(58.9)
(58.2)
Assets held for sale (excluding debt)
12.3
4.7
Net debt (including assets held for sale)
(266.4)
(171.4)
Equity shareholder funds
271.6
271.7
21

22. RPC Group Plc
2013/14 Results
FINANCIAL REVIEW PENSIONS UPDATE
£ million
MAR 2014
MAR 2013
Retirement benefit liability UK DBs
46.7
33.5
Other retirement benefit obligations
22.5
24.5
Termination benefits
1.2
1.6
Other employee benefit liabilities
2.1
3.1
Total employee benefit liability (LT)
72.5
62.7
22

23. RPC Group Plc
2013/14 Results
BUSINESS REVIEW ACQUISITIONS – M&H PLASTICS
23
Leading position in UK plastic packaging to the personal care segment with significant exports to MLE and a growing presence in the US
●
Recognised UK leader in plastic personal care packaging (blow moulded bottles, injection moulded jars, flexible tubes, closures, decoration)
●
Unique position offering the widest range of personal care containers available
●
Leading UK position with substantial MLE exports in short run, low volume, higher added value stock ranges alongside leading bespoke capability supported by in- house tool shop
●
Focus on higher added value and niche brands, direct and via filler and distributor channels – business model underpinned by production flexibility and industry leading speed and excellence in design and new product development
●
Product reach extended reach to healthcare and food ranges
●
Significant exports to MLE (20% sales); rapid growth at US site
M&H Plastics’ primary UK site at Beccles, UK
The M&H site at Winchester, Virginia

24. RPC Group Plc
2013/14 Results
BUSINESS REVIEW ACQUISITIONS – HELIOPLAST
24
●
Market leading provider of high quality injection moulded packaging
●
Highly experienced management team
●
Excellent technical capabilities
●
Successful and long-standing exporter
●
Well invested manufacturing capacity with new state-of-the-art facility
●
Strong financial position
Helioplast site in Bosnia-Herzegovina

25. RPC Group Plc
2013/14 Results 25
BUSINESS REVIEW ACQUISITIONS – ACE
RPC acquisition criteria
●
Strategic fit
●
Strong incumbent management
●
Financial track record
●
Financial criteria:
−
ROCE > WACC of RPC
−
Quantifiable synergies
−
Earnings accretion
−
Impact on Group KPIs
Vision 2020 financial metrics
●
RONOA of at least 20%
●
Return on sales of at least 8%

Clear acquisition rationale and strategy

Professional management team to be retained

Strong profitability and growth achieved

Pro forma ROCE ahead of WACC of c.9%

Asian packaging growth

EPS accretive in first full year post acquisition

See below

Ace RONOA at 31% in 2013

Ace return on sales at 18% in 2013

26. RPC Group Plc
2013/14 Results 26
BUSINESS REVIEW ACQUISITIONS – ACE
Power
Group
Share of sales FY2013
£104m
Services offered
Products offered
Lifestyle
£52m
Complete services from design and tooling through manufacturing and assembly
•
Consumer electronics
•
Water proof iPad cases
•
Bi-injection moulding
•
Sanitary products
Automotive
£21m
Works with big automotive OEMs and tier 1 suppliers and produces customised structural and decorative parts
•
Remote control keys
•
Engine components
•
Chrome plated plastic
Packaging
£15m
Complete service including concept design, prototype and tooling
•
Food packaging
•
Cosmetics packaging
•
Consumer packaging mould
£10m
Full service engineering expertise in micromachining / metal insert moulding
•
Connectors
•
Power switches
•
Metal insert moulding
Medical
£6m
Medical device solutions for respected medical OEMs
•
Glucose meters
•
Syringes
Main customers*
Sample products
Source Management information
Notes
1. FX rates: GBP/HKD 12.93 14% 50% 6%10%20%
*Top 10 customers represent 56% of total 2013 sales
**Ace has been supplying Superfos (now part of RPC) since 2008
**

27. RPC Group Plc
2013/14 Results
VISION 2020 PREDICTED GROWTH IN RIGID PLASTIC PACKAGING
27
13.510.82.713.64.715.412.13.521.66.5EuropeNorth AmericaSouth & Central AmericaAsiaRest of World2013 Predicted2018 Forecast
Source: Smithers Pira, 2013
BRIC region (million tonnes)
Rigid plastic packaging set to grow (million tonnes)
Rigid plastic packaging grows across all regions:
The BRIC countries show strong growth:
1.11.71.16.91.42.32.312.0BrazilRussiaIndiaChina2013 Predicted2018 Forecast
2.7%
2.3%
5.3%
9.8%
6.9%
5.2%
6.1%
15.2%
12.0%
X% CAGR 2013-2018
X% CAGR 2013-2018

28. RPC Group Plc
2013/14 Results
FINANCIAL REVIEW KEY FIGURES
28
2.5
2.6
2.7
2.5
2.7
09/10
10/11
11/12
12/13
13/14
13.5%
15.2%
20.5%
19.4%
20.2%
Mar 10
Mar 11
Mar 12
Mar 13
Mar 14
ROCE – Total Group
Dividend Cover
ROCE – Pre 2013/14 acquisitions
For continuing operations
13.5%
15.2%
20.5%
19.4%
18.7%
Mar 10
Mar 11
Mar 12
Mar 13
Mar 14