Emmi Ag · SIX:EMMN
Emmi — Investor Day (December 2010)
42 slides from Emmi's investor day presentation, Dec 7, 2010
Slide 1: Emmi: Capitalize on a powerful strategy
Emmi: Capitalize on a powerful strategy Emmi Investor Day Kaltbach/Lucerne, 7 December 2010 Urs Riedener, CEO
Slide 2: Content
Content Emmi in brief Roadmap to success Ahead of us Summary and outlook
Slide 3: Independent and successful in open markets
Independent and successful in open markets Strategy and vision Vision § Independent and internationally successful dairy in open markets Market positioning § The leading Swiss company for cheese and dairy products § The leading company for Swiss cheese worldwide § One of the leading premium dairies
Slide 4: Broadly based product portfolio
Broadly based product portfolio Product groups (Net sales 2009) Dairy products Fresh products 28.5 % (CHF 746 million) 21.5 % (CHF 564 million) Other products/services 6.4 % (CHF 169 million) Powder/concentrates 3.3 % (CHF 86 million) Cheese 35.1 % (CHF 919 million) Fresh cheese 5.2 % (CHF 135 milli
Slide 5: Expansion through subsidiaries and alliances
Expansion through subsidiaries and alliances International reach Canada Benelux USA United Kingdom Germany Austria Italy France Spain Switzerland 43% Kaiku Emmi Investor Day, 7 December 2010, Urs Riedener Page 5
Slide 6: Steady improvement of productivity and efficiency
Steady improvement of productivity and efficiency Most important production sites Switzerland Emmen LU Suhr AG Kirchberg BE Langnau BE Ostermundigen BE Dagmersellen LU Landquart GR International Rovere della Luna / I Monroe/Wisc, USA Arcata, CA, USA Penn Yan, NY, USA Moers, Germany (Trentinalatte S.
Slide 7: Content
Content Emmi in brief Roadmap to success Ahead of us Summary and outlook
Slide 8: Interplay of strategy, structure and culture is key
Interplay of strategy, structure and culture is key Strategy, structure and culture 2008 2009 2010 YTD 2010 Adjusting the Strategy “Emmi 2014” Implementing the strategy strategy Structure Designing the new Transforming the organization organization Culture Deriving company values Living the values E
Slide 9: Emmi 2014: An international player with competitive structures
“Emmi 2014”: An international player with competitive structures Background Success factors Strategic pillars § Swiss market saturated; § Critical company size/ international market key international player growing § Early, proactive § Market liberalization in adjustment to market Defence of positio
Slide 10: High quality portfolio, strong position in regions
High quality portfolio, strong position in regions Strategy implementation: Switzerland Defence of position within Switzerland Organic performance Tactical acquisitions § CH market share of just under 50% § Nutrifrais: Acquisition of 60% of maintained, while increasing the shares by Emmi quality of
Slide 11: Organic growth of international platforms complemented with acquisitions
Organic growth of international platforms complemented with high potential acquisitions Strategy implementation: International markets Growth outside Switzerland Organic growth § Organic growth in local currencies of 12.3% (2009 compared to 2008) § Growth with international platforms - Caffè Latte v
Slide 12: Cost management
CHF 15 million of cost savings in 2010 Strategy implementation: Cost management Cost management Highlights § Implementing Kaizen in cheese sector § Streamline Programme for dairy products § Various small streamlining investments with pay-back of 3 years § Optimized logistics, in particular in intern
Slide 13: Enhanced quality of the product portfolio
Enhanced quality of the product portfolio Product portfolio Private labels Commodity / Branded products with added value Logistic services Approach Approach Approach • Growth with • Growth with added • Balance between sales international platforms value private label and profitability and local hero
Slide 14: Facts about recent acquisitions
Facts about recent acquisitions
Slide 15: Entering new channels in the USA: Acquisition of Roth
Entering new channels in the USA Acquisition of Roth Growth outside Switzerland Sales: approx. USD 90 million § Strong position in the food service Employees: 125 sector Products § Premium segment, award-winning – High quality speciality products cheeses (cow’s milk) § Helps to expand into new chann
Slide 16: Growth continues since acquisition by Emmi
Growth continues since acquisition by Emmi Emmi Roth USA Inc.: Sales development 14 12.0 12 11.2 10.6 9.5 Cheese sales in million kg* 10 8.5 8 6 4 2 0 2005 2006 2007 2008 2009 2010** 2006: Expansion of storage capacities in September 2006 2009: Acquisition by Emmi on 1 January 2009 * Of cheese produ
Slide 17: Enhance position in Emmi's key markets: Acquisition of Fromalp
Enhance position in Emmi’s key markets Acquisition of Fromalp Growth outside Switzerland Sales: approx. CHF 100 million § Eliminates Emmi’s main Employees: 150 competitor in Fondue and Products Raclette – Fondue/Processed cheese – Raclette § Identical key markets of Fromalp and Emmi – Industry busin
Slide 18: Footprint into the US goat's cheese business: Cypress Grove
Footprint into the US goat’s cheese business Acquisition of Cypress Grove Chèvre Growth outside Switzerland Sales: approx. USD 10 million § Well-known, leading brand for Employees: 45 goat’s cheese specialities in the Products premium segment – Fresh and ripened goat’s cheese specialities § Rapidly
Slide 19: Door opener to push business in UK and Germany: Onken
Door opener to push business in UK and Germany Acquisition of Onken Growth outside Switzerland Sales: approx. CHF 75 million § Strong brand in line with Emmi’s Products premium world – Natural yogurt § Significantly strengthens two of – Fruit yogurt Emmi’s key markets – Wholegrain yogurt § Helps ach
Slide 20: UK dairy market: High affinity to Swissness
UK dairy market: High affinity to Swissness Swissness study: “How do you perceive Switzerland?” 4.5 4 3.5 3 2.5 2 1.5 1 0.5 0 USA DEU UK AUT BENELUX FRA SPA ITA Empathy (1 - 5) Respect (1 - 5) Emmi Investor Day, 7 December 2010, Urs Riedener Page 20
Slide 21: UK dairy market: High growth in the UK over the years
UK dairy market: High growth in the UK over the years… Market growth for fresh dairy products and cheese Yoy: current prices 10 8 6 4 UK 2 0 2005 2006 2007 2008 2009 -2 -4 -6 UK GER AUT ITA USA Source: Euromonitor Emmi Investor Day, 7 December 2010, Urs Riedener Page 21
Slide 22: Growth forecast dairy sector
… which will also exceed growth in other European countries in the future Growth forecast dairy sector Emmi Investor Day, 7 December 2010, Urs Riedener Page 22
Slide 23: Transforming the organization
Transforming the organization
Slide 24: Organization adapts to company's development
Organization adapts to company’s development Organizational development of Emmi Future organization 2014 – 20xx: Strengthen New international organization position 2005-2014: Previous Defend no 1 position organization in CH & implement intl. anchors 1990-2005: Build up no. 1 position in CH & 1950-19
Slide 25: Implementing necessary adjustments and keeping key elements
Implementing necessary adjustments and keeping key elements The current organization for the future § New marketing organization > under one umbrella § New sales organization > one voice to the customer § Strengthen international organization > clear responsibilities § Preserved entrepreneurship of
Slide 26: Improvement of skills on different levels
Improvement of skills on different levels Measures initiated in 2010 Training Implementation of the Organization 2010 § Launch of Marketing Academy § Sales training § Kaizen programmes in different production units Career Programmes § Introduction of Management Development Process Adjustments below
Slide 27: Living the values
Living the values
Slide 28: Common culture base to support performance goals
Common culture base to support performance goals Corporate values Process led by Group management § Top-down development and introduction S § Visualization and introduction to ideas § Story development to make values tangible § Link with management practices § Link with daily working life O C K § Re
Slide 29: Intensive dialogue with all employees
Intensive dialogue with all employees Roadshow to explain strategy and corporate values Emmi Investor Day, 7 December 2010, Urs Riedener Page 29
Slide 30: Interim result
Interim result
Slide 31: Steady growth of EBIT and net profit
Steady growth of EBIT and net profit Development of profits % 5 4.8 4.2 4 3.7 3.8 3.5 3.3 3.2 3 3.1 2.7 2.9 2.6 2.6 2.5 2.5 2.5 2.3 2 2.1 2.2 1.9 1.9 2.1 1.6 1 0 Jun 05 Dec 05 Jun 06 Dec 06 Jun 07 Dec 07 June 08 Dec 08 June 09 Dec 09 June 10 Jun = HY results Dec = FY results EBIT Net profit Emmi Inv
Slide 32: Invest where it makes a difference
Invest where it makes a difference Comparison of Caffè Latte with overall marketing spending Indexed development of marketing spending 250 200 183 200 166 150 133 127 124 100 112 117 100 50 0 2006 2007 2008 2009 2010* Marketing & sales overall Emmi Caffè Latte (Index 2006 = 100) Emmi Investor Day, 7
Slide 33: Agenda
Agenda Emmi in brief Roadmap to success Ahead of us Summary and outlook
Slide 34: Sales 2002–2009 and long-term goal
Sales 2002 – 2009 and long-term goal Steady growth towards 50/50 ratio International & CH In CHF million 3,000 2,671 2,619 2,501 2,500 2,335 626 675 50% 587 2,027 509 2,000 1,879 1,926 444 414 447 1,500 1,389 50% 256 1,944 2,045 1,000 1,826 1,914 1,465 1,479 1,583 1,133 500 0 2002 2003 2004 2005 200
Slide 35: Align strategy, structure and culture for sustainable corporate fitness
Align strategy, structure and culture for sustainable corporate fitness Measures in strategy, structure and culture Strategy § Further secure Swiss market position § Further acquisitions in key markets § Further build branded platforms § Add innovation to existing platforms § Steady improvements in
Slide 36: Balance between organic growth and acquisitions
Balance between organic growth and acquisitions The focus in Switzerland and abroad Swiss market § Main focus on organic development § Completion with small, tactical acquisitions, above all to expand range of local products International markets Organic growth and acquisitions are strategic initiat
Slide 37: Possible routes for acquisitions
Possible routes for acquisitions Brand Jewel Technology Market Synergies/ Organic Regional / Leader / Added Efficiency Completion of Value PL range CHF 1,000 million International Strategic/ Onken Possible Roth CHF 50 million Käse/ Fromalp Possible Cypress Grove Tactical/ Swiss Nutrifrais / Possible
Slide 38: Consistently implementing the strategy 2014 and preparing next period
Consistently implementing the strategy 2014 and starting to prepare the next strategic period Preparing the strategic period after 2015 Route 1 Route 2 Route 3 Organic growth Acquisitions in key Partnering / JV countries ■ Four Emmi branded R&D platforms 09: Roth (USA) ■ Valio, Raisio ■ Tailor-made
Slide 39: Agenda
Agenda Emmi in brief Roadmap to success Ahead of us Summary and outlook
Slide 40: Outlook 2011 - Markets
Improving consumer sentiment but currency issues are still challenging Outlook 2011 - Markets Consumers § Stabilized consumer sentiment in the US and in Europe § Stagnating retail spending in Switzerland Competition § Strong competition through imports (in CH) and multinational brands (worldwide) §
Slide 41: Summary: Key findings
Summary Key findings § Concentration on strong brands proves to be successful § Interaction of strategy, structure and culture is key § Organizational development materializes § Good acquisitions pay off § Emmi has not reached the end of the story § The company is well positioned to reach its goals,
Slide 42: Outlook for 2010 as a whole
Outlook for 2010 as a whole Group sales stable, growth abroad § Group sales ~0% organic (slight increase including acquisitions) - Switzerland, incl. acquisitions stable - Switzerland, organic -2% - International, incl. acq. 8 – 10% - International, organic 6 – 8% § EBIT CHF 115 – 125 million § Net