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RPC Group Plc Proposed Acquisition of GCS

101

RPC – THE ESSENTIAL INGREDIENT

RPC Group Plc Proposed Acquisition of Global Closure Systems (GCS) 14 December 2015


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Important Notice Disclaimer

THIS DOCUMENT IS NOT FOR PUBLICATION, RELEASE OR DISTRIBUTION IN AND MAY NOT BE TAKEN OR TRANSMITTED INTO THE UNITED STATES OF AMERICA, CANADA, JAPAN, AUSTRALIA OR SOUTH AFRICA AND MAY NOT BE COPIED, FORWARDED, DISTRIBUTED OR TRANSMITTED IN OR INTO THE UNITED STATES OF AMERICA, CANADA, JAPAN, AUSTRALIA OR REPUBLIC OF SOUTH AFRICA OR ANY OTHER JURISDICTION WHERE TO DO SO WOULD BE UNLAWFUL. THE DISTRIBUTION OF THIS DOCUMENT IN ANY OTHER JURISDICTIONS MAY BE RESTRICTED BY LAW AND PERSONS INTO WHOSE POSSESSION THIS DOCUMENT COMES SHOULD INFORM THEMSELVES ABOUT, AND OBSERVE ANY SUCH RESTRICTIONS. ANY FAILURE TO COMPLY WITH SUCH RESTRICTIONS MAY CONSTITUTE A VIOLATION OF THE LAWS OF THE UNITED STATES, CANADA, JAPAN, AUSTRALIA OR ANY OTHER SUCH JURISDICTION. BY ACCEPTING THIS DOCUMENT, YOU AGREE TO BE BOUND BY THESE RESTRICTIONS. This presentation comprises the written materials/slides for a presentation concerning the proposed acquisition of Financière Daunou 1 SA and rights issue (the "Transaction") by RPC Group Plc (“RPC” or the "Company"). The following applies to the presentation materials following this page, the oral presentation of the slides by the Company, the question-and-answer session that follows that oral presentation, hard copies of this document and any materials distributed at, or in connection with, this presentation. You are therefore advised to read this carefully before reading, accessing or making any other use of the presentation materials. This presentation does not constitute or form part of any offer or invitation to sell or issue, or any solicitation of any offer to purchase or subscribe for, any securities in the Company or securities in any other entity nor shall it or any part of it nor the fact of its distribution form the basis of, or be relied on in connection with, any contract or investment decision in relation thereto. This presentation is not a prospectus and prospective purchasers of securities should not subscribe for any securities referred to in this presentation except on the basis of information in the combined circular and prospectus expected to be published by the Company on or around 14 December 2015 (the "Prospectus"). The Prospectus will include a description of risk factors in relation to the Transaction and an investment in the Company. Copies of the Prospectus will, following publication, be available from the Company at its registered office. The information contained herein is for discussion purposes only and does not purport to contain all information that may be required to evaluate the Transaction, the Company and/or its financial position. No reliance may be placed for any purposes whatsoever on the information contained in this presentation or on its completeness. The contents of this presentation have not been verified by the Company or RBC Europe Limited ("RBC"), Deutsche Bank AG, London Branch ("Deutsche Bank"), Panmure Gordon (UK) Limited ("Panmure Gordon") and Barclays Bank PLC (“Barclays") (together, the "Banks"). No representation or warranty, express or implied, is given by or on behalf of the Company or the Banks or any of such persons’ directors, officers or employees or any other person as to the accuracy, completeness or verification of the information or the opinions contained in this presentation and no liability is accepted by the Company or the Banks or any of such persons members, directors, officers or employees nor any other person for any loss arising, directly or indirectly from any use of such information or opinions or otherwise. To the extent available, the industry, market and competitive position data contained in this presentation come from official or third party sources. The Company has not independently verified the data contained herein and there is no guarantee of the accuracy or completeness of such data. In addition, certain of the industry, market and competitive position data contained in this presentation come from the Company's own internal research and estimates based on the knowledge and experience of the Company's management in the markets in which the Company operates. While the Company believes, acting in good faith, that such research and estimates are reasonable and reliable, they, and their underlying methodology and assumptions, have not been verified by any independent source for accuracy or completeness and are subject to change. Accordingly, prospective purchasers of securities should not place reliance on any of the industry, market or competitive position data contained in this presentation. This presentation contains forward-looking statements that involve substantial risks and uncertainties and actual results and developments may differ materially from those expressed or implied by these statements or whether as a result of new information, future events or results or otherwise. Forward-looking statements include statements concerning plans, objectives, goals, strategies, future events or performance, and underlying assumptions and other statements which are other than statements of historical facts. The words “believe”, “expect”, “anticipate”, “intends”, “estimate”, “forecast”, “project”, “will”, “may”, “should” and similar expressions identify forward-looking statements. Others can be identified from the context in which they are made. These forward-looking statements are subject to risks, uncertainties, estimates, assumptions and other factors about the Company and its subsidiaries and investments, including those described in the risk factors section of the Prospectus. These forward looking statements speak only as of the date of this presentation. No statement in this presentation is intended to be nor may be construed as a profit forecast. RBC, Deutsche Bank and Barclays, who are each authorised by the Prudential Regulatory Authority and regulated by the Financial Conduct Authority ("FCA") in the United Kingdom, and Panmure, which is authorised and regulated by the FCA in the United Kingdom, are advising the Company and no one else in connection with the Transaction and will not be responsible to anyone other than the Company for providing the protections afforded to their respective clients. Prospective purchasers of securities of the Company are required to make their own independent investigation and appraisal of the business and financial condition of the Company and the nature of the securities of the Company and should make all trading and investment decisions in reliance on their own judgement and not in reliance on any of the Banks. None of the Banks is providing any such persons with advice on the suitability of the matters set out in this presentation or otherwise providing them with any investment advice or personal recommendations regarding any securities of the Company. Any presentations, research or other information communicated or otherwise made available in this presentation is incidental to the provision of services by the Banks to the Company and is not based on individual circumstances. Attendees of this presentation should seek their own independent legal, investment and tax advice as they see fit. This presentation is only addressed and directed at persons in member states of the European Economic Area who are "qualified investors" within the meaning of Article 2(1)(e) of the Prospectus Directive (Directive 2003/71/EC) ("Qualified Investors"). Within the United Kingdom, this presentation is directed only at persons in the United Kingdom who (i) are Qualified Investors and (ii) have professional experience in matters relating to investments and/or to high net worth companies falling within Articles 19(5) or 49(2) respectively of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (or persons to whom it may otherwise be lawfully communicated) and, if permitted by applicable law, is supplied outside the United Kingdom to professionals or institutions whose ordinary business involves them engaging in investment activities ("relevant persons"). The information contained in this presentation is not intended to be viewed by, or distributed or passed on (directly or indirectly) to, and should not be acted upon by any other class of persons. By attending or accessing this presentation, you will be taken to have represented, warranted and undertaken to the Company and the Banks that: (i) you are a Qualified Investor or a relevant person; and (ii) you have read and agree to comply with, and be bound by, the contents of this disclaimer. The Nil Paid Rights, the Fully Paid Rights, the New Ordinary Shares and the Provisional Allotment Letters (each as defined in the Prospectus) have not been and will not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”), or under the applicable securities laws of any state of the United States or any province or territory of Australia, Canada, Japan or the Republic of South Africa. Subject to certain exceptions, none of the Nil Paid rights, the Fully Paid Rights, the New Ordinary Shares or the Provisional Allotment Letters may be offered, sold, taken up, renounced or delivered, directly or indirectly, within Australia, Canada, Japan, the Republic of South Africa or the United States or in any country, territory or possession where to do so may contravene local securities laws or regulations. The Nil Paid Rights, the Fully Paid Rights, the New Ordinary Shares and the Provisional Allotment Letters are being offered and sold outside the United States only in offshore transactions within the meaning of and in accordance with Regulation S under the Securities Act. There will be no public offer of the Nil Paid Rights, the Fully Paid Rights, the New Ordinary Shares or the Provisional Allotment Letters in the United States.


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Compelling strategic acquisition in line with our Vision 2020 Transaction summary

● Enterprise value of €650m (c. £470m1), cash-free and debt-free − Multiple of 6.8x LTM EBITDA (to 30 September 2015) of €95.4m2 (£68.9m1)

● Directors believe that GCS is a leading global manufacturer of plastic closures and dispensing systems for a wide range of end markets

● Directors believe that the combination offers substantial strategic and financial benefits − Strategic opportunity to extend RPC’s product reach and capabilities globally − Strengthens RPC’s position as a leading European consolidator in rigid plastic packaging − Highly complementary and synergistic product offering and geographical footprint − Combines two of Europe’s leading design and engineering companies in plastic products − Enlarged platform to generate purchasing and efficiency savings

● In line with Vision 2020, building on successful acquisition history ● Meets RPC’s strict acquisition criteria ● EPS accretive in the first full year, GCS’ ROCE3 ahead of RPC’s WACC ● Targeted pre-tax cost synergies of €15m per annum, fully realisable within the first two full years

● Fully underwritten rights issue of c. £232.6m4

● Part utilisation of existing RCF which has been increased from £490m to £770m ● Expected enlarged group opening leverage of c. 2.1x net debt / LTM EBITDA5 as at 31 March 2016

Notes 1. FX rate: £1 = €1.3841 2. As stated in the unaudited interim consolidated financial statements presented in the GCS Seller Group management quarterly report announced by the GCS Seller Group on 27 November 2015. The GCS Seller Group comprises

the GCS Group and the holding company Financière Daunou 5 S.a.r.l, which is a holding company which had no material revenues and operating costs in the periods stated. As such, in the Directors’ opinion, the information presented is an accurate reflection of the historical financial information for the GCS Group for the equivalent period. In addition, in the Directors’ opinion, the GCS Seller Group quarterly management reports are prepared in a form consistent with the accounting policies adopted in RPC’s latest annual report

3. Together with €15m of estimated pre-tax cost synergies 4. Net proceeds of c. £227.0m after expenses 5. Excluding non-recurring items

Strategic rationale

Transaction

Financing


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Low customer concentration: 2014 Sales by top customers

#1 10%

#2–10 35%

#11–20 13%

Other 42%

A diversified closures and dispensing systems business

Business overview: ● A global manufacturer of plastic

closures and dispensing systems for a wide range of end-markets

● 2014 revenues of €590.5m ● Broad customer portfolio (c. 1,800)

with top 20 customers representing 58% of sales

● Directors believe GCS has strong, long term relationships with key customers (global blue chip and smaller local)

● 23 manufacturing facilities (including mould shops) spread across 13 countries in Europe, Americas and Asia

● Employs c. 3,500 people

Diversified revenue base: 2014 Sales by region

UK 27%

Central Europe

28%

Southern Europe

27%

Americas 12%

Asia 6%

GCS business overview

Source: GCS Management information

Top 20

58%


105

33%

8% 7%

Exposure to an attractive and diversified range of consumer end markets

• Syrups and liquids • Tablets / pills • Sterile solutions • Vitamins and supplements

Group

Share of sales FY2014

€590.5m1

Main sub-segments

Main product categories

Household

• Sticks and dosing caps • Tamper evident caps • Dispensing caps • Child resistant closures • Trigger pumps

Pharma.

• Tamper evident closures • Child resistant closures • Droppers • Measuring devices

Food

€69.5m

• Wide-mouth caps • Tamper evident closures • Pouch closures • Flip-top closures

Personal Care

• Dosing caps • Jars and applicators • Dispensing closures • Valve dispensing closures • Child resistant closures

Sample products

• Dressings and condiments • Instant coffee • Edible oil and vinegars • Dairy products • Spreads • Conserves

• Skin care • Hair care • Bath and shower gels • Oral care • Deodorants

• Household cleaning products

• Laundry care • Dishwashing • Agrochemicals • Adhesives and glues

Wine & Spirits

• Non refillable pilfer proof • Roll on pilfer proof

• Spirits • White spirits • Specialty alcohol

• Screw top closures • Dispensing caps • Valve dispensing closures • Carton fittings

• Waters • Carbonated soft drinks • Energy and sport drinks • Beer • Syrups and dilutables • Juices and tea

12%

Beverage

€89.9m €144.9m €38.6m €48.9m €192.1m

15% 25%


Source: GCS Management information Notes 1. Group sales include Others segment of €6.5m 2. Based on GCS’ volume (units) share of its addressed market of caps and closures with a total market size of 1.7 trillion units in 2014

• n.a. • 23% market share • #1 Europe

• 23% market share • #1 / #2 Europe (co-leader);

#3 Asia, #4 Americas

• 24% market share • #1 Europe; #5 Americas

• n.a. • 20% market share • #1 Europe; #1 / #2 Asia

(co-leader)

Market share and position2


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A highly complementary product offering combining leading packaging and closure products

End Market Example RPC Packaging Products Example GCS Closure and Dispensing System Products

Beverage

Personal Care

Household/ Non-Food

Food

Pharma

Lifestyle PET Drinks Range

Closures for Jeyes Bottle

El Paso Bottle Closures for Heinz Bottle Food Bottle Range Closures for HP Bottle

Syrup PET Range

Big Ball Deodorant Deodorant Roll-on Bottles for Nivea Lotion Closure for Nivea Lotion

Child Resistant Closures M&H Healthcare Containers

Beverage Dispensing Closures Juice Closure

Pump Spray Closure Pourer Closure for Large Containers Jeyes Easy Range Bottle

Westland Even-Flo Container Container for JCB

Source: Management information


Juice Bottles 1881 Closure


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453.5 466.5

590.1 603.5

14.2% 16.6%

13.4% 15.8%

0%

4%

8%

12%

16%

20%

24%

28%

-

100

200

300

400

500

600

700

Sep-14 9M Sep-15 9M Sep-14 LTM Sep-15 LTM

Sales EBITDA Margin (%)

Current trading1 (€m)

Current trading and GCS financial development

Directors believe that: ● Overall trading improved significantly ● Underlying sales on similar level to previous year ● Improved cost performance and positive cost / price

impact

Financial development of GCS2 (€m, Dec y/e)


€m 2012 2013 2014

Revenues2 565.5 583.3 590.5

EBITDA2 64.0 69.7 82.8

EBITDA margin2 11.3% 11.9% 14.0%

Source: GCS Management information Notes 1. As stated in the unaudited interim consolidated financial statements presented in the GCS Seller Group management quarterly report announced by the GCS Seller Group on 27 November 2015. The GCS Seller Group comprises the

GCS Group and the holding company Financière Daunou 5 S.a.r.l, which is a holding company which had no material revenues and operating costs in the periods stated. As such, in the Directors’ opinion, the information presented is an accurate reflection of the historical financial information for the GCS Group for the equivalent period. In addition, in the Directors’ opinion, the GCS Seller Group quarterly management reports are prepared in a form consistent with the accounting policies adopted in RPC’s latest annual report

2. Financial information for Financière Daunou 1 SA (including non-recurring items)


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Compelling strategic fit with Vision 2020

Strengthening and extending market positions in core European markets

● GCS is a market leader across all of its closures and dispensing markets in Europe ● Strong engineering capability in both groups in terms of injection moulding and simulation tools ● Combining two leading design and engineering companies in plastic products ● Complementary and synergistic GCS product offering to existing RPC packaging portfolio

● Increases non European exposure with manufacturing presence in USA and China with one extra site in each country

● Adds new manufacturing capability in Mexico, Thailand, Switzerland, Romania and Philippines Extending geographical reach

Enhancing scale in European polymer buying

● RPC currently buys circa 475kt of polymer per annum, mainly Western Europe ● GCS buys circa 135kt of polymer per annum ● The combined group’s polymer consumption will equate to c.6% of the total Western European

output of polymers for rigid plastic packaging

Group strategy and acquisition rationale


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Clear synergistic opportunities

Targeted ongoing annual pre-tax cost synergies of €15m per annum fully realisable within the first two full years. Expected one-off cash costs to deliver synergies estimated at c. €10m (expected to be incurred in the first full year) Cost synergy opportunities ● Purchasing optimisation (polymer purchasing and other areas of procurement) ● Elimination of duplicate administrative overheads ● Optimisation of the manufacturing footprint of the combined group

Cash synergies ● Scope for cash synergies arising from alignment of capital expenditure and improved working capital management

Integration Plan ● GCS will initially form a standalone business cluster ● RPC has an excellent track record of integration and reorganisation

– Promens polymer purchasing synergies higher than originally estimated and realised ahead of schedule – Evidenced by the success of both the RPC 2010 and Fitter for the Future projects – Previous track record of realising synergies on PET Power, Innocan, M&H Plastics, Manuplastics, Helioplast and

Superfos

Targeted steady state pre-tax cost synergies of €15m



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Acquisition criteria & Vision 2020 financial metrics

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 Strong incumbent management team in place Resilient profitability from diversified geographic and product

markets

ROCE1 ahead of RPC WACC

Polymer purchasing, removal of administrative overheads, optimisation of manufacturing footprint

EPS accretive in first full year post acquisition See below

GCS 2014 RONOA of 29% (post synergy realisation)1

GCS 2014 ROS of 11% (post synergy realisation)1


Notes 1. Together with €15m of estimated pre-tax cost synergies


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Acquisition financing structure Transaction structure and timetable

Consideration

● Enterprise value of €650m (c. £470m1), cash-free and debt-free

– Multiple of 6.8x LTM EBITDA (to 30 September 2015) of €95.4m2 (£68.9m1)

– Cash consideration of approximately €186m (c. £134m1)

● Conditional on shareholder approval, consultation with French Works Councils and anti-trust clearances

Financing

● £232.6m3,4 rights issue fully underwritten by Deutsche Bank, Panmure Gordon and Barclays

– Fundraising not conditional on completion of the acquisition

– Discount to TERP (adjusted for the 2015/2016 interim dividend): c. 35.1%

● Balance of funding drawn from increased 5-year RCF

– Increase in the facility to £770m from £490m to provide additional headroom

● Expected enlarged group opening leverage of c. 2.1x net debt / LTM EBITDA5 as at 31 March 2016

Notes 1. FX rate: £1 = €1.3841 2. As stated in the unaudited interim consolidated financial statements presented in the GCS Seller Group management quarterly report announced by the GCS Seller Group on 27 November 2015. The GCS Seller Group comprises

the GCS Group and the holding company Financière Daunou 5 S.a.r.l, which is a holding company which had no material revenues and operating costs in the periods stated. As such, in the Directors’ opinion, the information presented is an accurate reflection of the historical financial information for the GCS Group for the equivalent period. In addition, in the Directors’ opinion, the GCS Seller Group quarterly management reports are prepared in a form consistent with the accounting policies adopted in RPC’s latest annual report

3. Net proceeds of c. £227.0m after expenses 4. Rights issue shares will not carry the right to the interim dividend for the year ended March 2016 5. Excluding non-recurring items


112

Transaction timetable Transaction structure and timetable

Expected Timetable and Rights Issue Summary

Announcement of the Acquisition and Rights Issue 14 December 2015

Record Date for Rights Issue 29 December 2015

General Meeting to approve Rights Issue 4 January 2016

Admission and commencement of dealings in Nil Paid Rights, on the London Stock Exchange 5 January 2016

Deadline for acceptance of Rights Issue 19 January 2016

Commencement of dealing in New Ordinary Shares fully paid 20 January 2016

Expected date of completion of Acquisition By the end of March 20161

Lead Financial Adviser and Sponsor RBC Capital Markets

Joint Global Co-ordinators and Joint Bookrunners Deutsche Bank; Panmure Gordon

Joint Financial Adviser and Joint Bookrunner Barclays

Notes 1. Transaction expected to complete following French Works Councils’ consultation process and receipt of anti-trust clearances


113 Supplementary material


114 (x3)

Extensive European footprint

Mainland European manufacturing network ● 13 manufacturing facilities (11 factories and 2 mould shops) across 7 European countries ● All manufacturing facilities use injection moulding technologies and secondary operations

(e.g. assembly, cap closing, lining, slitting, pleating, printing and laser marking) ● The 2 mould shops add to RPC’s existing mould capabilities

South Europe ● Facilities in France, Spain and Italy ● One R&D Centre of Excellence in France

Central Europe

● Facilities in Germany, Poland, Switzerland and Romania ● R&D Centres of Excellence in Germany and Switzerland

UK ● 5 manufacturing facilities; all designated R&D Centres of Excellence ● Bridge of Allan (Scotland) facility produces GCS’ metal closure products for the Wines &

Spirits segment

Europe

Headquarters Factories R&D Centres of Excellence

Business overview GCS


Mould shops


115

Global footprint

Non-Europe locations

Non-European factories

GCS has attractive global presence in selected end markets ● €106m of sales (18%) generated outside of Europe in

2014 ● Among the Top 5 in Americas for Household products

with 12% market share ● Among the Top 4 in Americas for Personal Care products

with 24% market share ● In South East Asia, holds Top 3 positions in Personal

Care and Beverages closures end markets

Business overview GCS



116 Appendix


117

Business Review FO

CU

SE

D G

RO

WTH

Continuing focus on organic growth

Selective consolidation in Europe

Creating a meaningful presence outside Europe

• 4% underlying packaging sales increase in year* • Continued innovation in product design and engineering

• Acquisition of Innocan (May 2015) and Depicton (June 2015) • Organisational integration of Promens completed

• Further investment in USA to expand niche positions • 57% increase in non-European sales to £101m or 13% of Group total • Investment in greenfield plant in Brazil underway

Vision 2020 strategy: Progress to date

Source: RPC Group plc interim results presentation (25 November 2015); *Pro forma Group at constant exchange rates and polymer prices

Pursuing added value opportunities in non packaging markets

• Further investment in electroplating capabilities in China • Improved performance in Promens non-packaging businesses • Acquisition of Strata Products (November 2015)


118

549 498 525 589 800

507 484

522

633

11/12 12/13 13/14 14/15 15/16

Sales (£m) Adjusted Operating Profit (£m)

46.3 47.6 47.1 60.9

82.8

49.2 44.0 53.9

70.7

11/12 12/13 13/14 14/15 15/16

16.6p 17.0p 17.0p 20.2p 22.9p

17.3p 15.8p 19.5p

20.8p

11/12 12/13 13/14 14/15 15/16

Adjusted basic EPS*

For continuing operations Adjusted = before restructuring costs, impairment losses, amortisation of acquired intangibles and pension administration expenses * Restated following the Rights Issue in January 2015

RPC Key figures Financial Review

+36% +36% +13%

H1

H2

Source: RPC Group plc interim results presentation (25 November 2015)


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Outlook

Performance in the first half year encouraging

Vision 2020 strategy continues to generate further growth opportunities

Second half year started in line with management expectations

Further trading improvements expected as polymer prices ease and Promens-related synergies are realised

Source: RPC Group plc interim results presentation (25 November 2015)

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