SCA presentation at Deutsche Bank Consumer Goods Conference 2011

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Deutsche Bank Global Consumer Conference Lennart Persson, CFO Mats Berencreutz, COO Hygiene Businesses 14 June 2011

Transcript of SCA presentation at Deutsche Bank Consumer Goods Conference 2011

Page 1: SCA presentation at Deutsche Bank Consumer Goods Conference 2011

Deutsche Bank Global Consumer ConferenceLennart Persson, CFOMats Berencreutz, COO Hygiene Businesses

14 June 2011

Page 2: SCA presentation at Deutsche Bank Consumer Goods Conference 2011

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HeadingSubheading

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SCA world’s third largesthygienecompany

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Net sales SEK 107bn

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

SCA GroupA global hygiene products and paper company

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44444

Forest Products

Packaging Tissue

Personal Care

36%24%

16% 24%

SCA GroupSales and EBIT split 2010

29%

30%

25%

16%

Sales splitEBIT splitEBIT split

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0%

20%

40%

60%

80%

100%

2000 2010

5

% of net sales

Hygiene productsPackaging and Forest Products

46%60%

40%54%

2000 2010

SCA GroupHygiene business is growing

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HeadingSubheading

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SCAsupplies every

2nd napkinto North American restaurants

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North America

AFH Tissue: 3

Incontinence care: 3

Mexico

Incontinence care: 1

Tissue: 2

Feminine care: 3

Baby diapers: 3

Colombia

Incontinence care: 1

Feminine care: 1

Tissue: 1

Nordic region

Incontinence care: 1

Baby diapers: 1

AFH tissue: 1

Consumer tissue: 2

Europe

Tissue: 1

Corrugated board: 2

Solid-wood products: 2

Baby diapers: 3

Incontinence care: 1

Privately owned forests: 1

Australia

Feminine care: 1

Incontinence care: 1

Tissue: 2Global

Incontinence care: 1

AFH tissue: 3

Leading market positions

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Strong global and regional brands

Asia Pacific

Eastern Europe

Latin America

North America Europe

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SCA Group Strategic Priorities

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Cost reductions in all business areas of SEK 1bn

Cash flow from current operations:SEK 7.4bn

Efficiency programs in Packaging and Forest Products Closure/Divestment

of 18 packaging units

Supply chain excellence and asset utilization programs in Tissue Europe

Restructuring program in Baby diapers in Europe

New tissue plant in Mexico

New Personal Care plant in Russia

Personal Care Thin baby diaper TENA Ultra thins Strong TENA value

assortment

Tissue Tork Xpressnap

Café Tork Performance Tempo ice

Packaging Trueflo ZeoCool

Forest Products Increased value

added

SCA Group 5%*

Personal Care 2%** Emerging markets 10%**

Tissue 2%** Emerging markets 6%**

Packaging 20%*

Forest Products 3%**

* Adjusted for exchange rate movements, divestments and closures* *Adjusted for exchange rate movements

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Latin America

South East Asia

Eastern Europe /Russia

Strong SCA positions Good market growth Favourable socio-demographics

Good market growth Favourable socio-demographics

Middle East

China Incontinence care products

GrowthSCA’s growth markets

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Q1 2011 resultsSEK millions Q1 Q1 Change, Change,

unless otherwise stated 2011 2010 % %**

Net sales 25,393 26,199 *** -3 6 ****

EBIT* 2,112 2,027 4 10

EBIT margin* (%) 8.3 7.7

Profit before tax* 1,810 1,748 4 10

Earnings per share (SEK) 1.89 1.53 24

Cash flow from current operations 353 1,148

Debt/Equity ratio 0.49 0.57

* Adjusted for Packaging restructuring costs in 2010** Adjusted for exchange rate movements*** Net sales from SCA recycling business have been reclassified to other income with retroactive adjustment from 2010**** Adjusted for exchange rate movements and divestments

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Outlook 2011

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Good demand for all businessesGood growth in Emerging markets for Hygiene businessesContinued high raw material costs Increasing corrugated pricesPrice increases for Personal Care, Tissue and publication

papers during H2

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Personal careInitiatives 2010

Feminine care 17%

Incontinencecare 56%

Baby diapers27%

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Restructuring program in baby diapers in Europe Annual savings of EUR 15m with full effect

in Q3 2011

Investment in local production in Russia Acquisition of Copamex baby diapers business

No. 3 in Mexico

Growth TENA has increased market share Incontinence care products in China expanded Feminine care products launched in Malaysia and

tampons in Sweden and the Netherlands Extended range of Libero baby care products Emerging market sales increased 10%*

Innovation TENA Ultra thins Thin baby diaper Strong TENA value assortment

* Adjusted for exchange rate movements

Net sales 2010:SEK 25bn

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Personal CareInnovations strengthens market positions

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Personal CareGood growth opportunities

Usage of hygiene products

Units/capita/year Units/child/year Units/woman/year

Western Europe Eastern Europe Latin America AsiaNorth America

Kg/capita/year

Penetration in mature markets around 35%

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0200400600800

1,0001,2001,400

90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10

16

EURm

Newproducts & services

NorthEurope

SouthEurope

NorthAmerica

Emerging markets

Reimbursement

RetailTV

Internet

Design

Personal CareTENA a true success story

Annual sales growth 1990-2010: 9%

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Personal CareSustainability as a business driver

Growth potential in emerging marketsMore people can afford hygiene products

– and they prioritize it Smaller packs, local distribution and value

products in Latin America, Africa and AsiaCooperation with Wal-Mart’s Bodega

Aurrera stores in Mexico

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TissueInitiatives 2010

Consumertissue 62%

AFH-tissue38%

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Implementation of price increases

Investment in new tissue plant in Mexico

European brand migration project

Growth Tork has gained market share in Europe

and North America Emerging market sales increased 6%*

Innovation Tork Xpressnap Café Tork Performance Tempo Ice Tempo Kids Tempo toilet tissue

Net sales 2010:SEK 40 bn

* Adjusted for exchange rate movements

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TissueInnovations strengthens market positions

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Increased customer demand, both from consumer and B2B Several tenders secured thanks to green credentials,

i.e. Starbucks, Wembley stadium and McDonalds Increased demand for eco-labelling

90 Tork products received the EU Eco-label in 2010

Other labels such as the Green Seal, EcoLogo, Die Blaue Engel

TissueSustainability as a business driver

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TissueStronger brands and more efficient A&P

Focused, differentiated & consumer relevant mega-brand portfolio

From … … To

DACH East

Nordic NL

Complicated, region specific, inefficient brand portfolio

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TissueGood growth opportunities in emerging markets

Usage of hygiene products

Units/capita/year Units/child/year Units/woman/year

Western Europe Eastern Europe Latin America AsiaNorth America

Kg/capita/year

Penetration in mature markets around 35%

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TissueInvestments

New tissue machine, Germany

Start-up 2013

Capacity: 60,000 tonnes

Primarily AFH tissue products

Investment: SEK 1.1bn

New tissue machine, Russia

Start-up 2013

Capacity: 60,000 tonnes

Investment: SEK 1.2bn

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Increases capacity, efficiency and profitability

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Q & A

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Johan Karlsson, VP Investor RelationsTel: +46 8 788 51 30

Jessica Ölvestad, Manager Investor RelationsTel: +46 8 788 52 82

IR Contacts:

Email: [email protected] Website: www.sca.com