Kp Tissue, Inc. · TSX:KPT
Kp Tissue — Shareholder Meeting (June 2015)
26 slides from Kp Tissue's shareholder meeting presentation, June 2015
Slide 1: 2015 Annual Shareholder Meeting
2015 Annual Shareholder Meeting
Slide 2: Forward-Looking and Cautionary Statements
FORWARD-LOOKING AND CAUTIONARY STATEMENTS This Presentation on behalf of KP Tissue Inc. (the “Corporation” or “KPT”) does not constitute or form part of any offer for sale or solicitation of any offer to buy or subscribe for any securities nor shall it or any part of it form the basis of or be relie
Slide 3: Agenda
AGENDA • Opening Remarks • Call Meeting to Order and Appoint Secretary and Scrutineers • Notice of Meeting and Quorum • Voting and Procedural Matters • Presentation of 2014 Financial Statements and Auditors’ Report • Election of Directors • Re-appointment of Auditors • Termination of Formal Business
Slide 4: Mario Gosselin, Chief Executive Officer
MARIO GOSSELIN CHIEF EXECUTIVE OFFICER 4
Slide 5: 2014 Highlights
2014 Highlights • The industry leader in the Canadian consumer tissue market • Recognized as one of the premier consumer products companies in Canada • Continued ramp-up of TAD project and of market presence in private label segment in the United States • Acquisition of Metro Paper and opportunities
Slide 6: 2014 Highlights
2014 Highlights • Revenue reached significant milestone and increased to just over $1 billion • EBITDA increased by 4.6% to reach $121.6 million • Pressure on our margins from higher pulp and natural gas prices, coupled with a weaker Canadian dollar NBSK North American List Prices per MT $1,300 $1,2
Slide 7: TAD Project
TAD Project • Premium bathroom tissue sales expected to grow faster than other market categories • In Fiscal 2014, TAD Product EBITDA contribution of $26.9 million • Expected TAD Product EBITDA contribution for Fiscal 2015 of $36 to $42 million • TAD Product outlook for Fiscal 2017 - $60 million EBI
Slide 8: Canada's Leading Tissue Company
Canada’s Leading Tissue Company • Canadian leader in Consumer and Away-from-Home industry segments • Leading brands: Scotties, Cashmere, White Swan, Purex, SpongeTowels • In 2014, Cashmere was the best-selling bathroom tissue brand in Canada. In Western Canada, Purex was again the top brand. 8
Slide 9: Canada's Leading Tissue Company
Canada’s Leading Tissue Company Bathroom Tissue Facial Tissue Paper Towels #2 #3 #3 20.1% 17.8% 5.5% #3 #4 #1 13.8% 4.6% 34.1% #4 #2 #4 5.1% 18.4% 3.4% Source: Nielsen; dollar market share for the 52-week period ended January 10, 2015. 9
Slide 10: Canada's Leading Tissue Company
Canada’s Leading Tissue Company • Launched two branded TAD products: Cashmere UltraLuxe Bathroom Tissue and SpongeTowels Ultra Strong Paper Towels • Both products have been strongly embraced by retailers and consumers. 10
Slide 11: Awards
Awards • #1 CPG company in Canada on Advantage Survey • CASSIES for Advertising Excellence for Scotties • Supplier of the Year: • Overwaitea • Balpex • Unisource • UGI – Partnership/Most Valuable Performance 11
Slide 12: Awards
Awards Adapt President Award Cardinal Health Award Greening of the Supply Chain 2014 GTA Top Employer Award Pulp & Paper International – Business Strategy of the Year 12
Slide 13: Canadian Activities
Canadian Activities • Lion’s share of our revenues derived from sales in Canada • Revenue increased by 1.7% and totalled $700 million • Higher sales volumes in the Consumer segment and contribution of Metro Paper acquisition completed in June 2014 13
Slide 14: U.S. Activities
U.S. Activities • Revenue increased by 32.4%, reaching a total of $316.7 million • This substantial increase generated by TAD Product sales and the Metro Paper acquisition • Private label premium product market offers solid growth potential 14
Slide 15: Mark Holbrook, Chief Financial Officer
Mark Holbrook CHIEF FINANCIAL OFFICER 15
Slide 16: Financial Highlights - Fiscal 2014
Financial Highlights - Fiscal 2014 • Record revenues of $1.046 billion, and EBITDA grew to $121.6 million • Solid balance sheet and financial position: – Cash balance of $51.8 million – Net debt to EBITDA ratio of 2.6 times 16
Slide 17: Financial Highlights - Q1 2015
Financial Highlights - Q1 2015 • Revenue increased 13.1 % to $265.4 million • EBITDA increased 28.8 % to $31.1 million • Consumer revenue grew by 5.9% and reached $210.1 million – TAD Product sales in the U.S. – Positive effect of F/X • Consumer EBITDA was up by 21.4% to $30.3 million 17
Slide 18: Financial Highlights - Q1 2015
Financial Highlights - Q1 2015 • Away-from-Home (AFH) segment, revenues increased by 45% to $48.6 million – Metro Paper acquisition accounts for most of the increase • AFH EBITDA for the quarter was $1.0 million compared to negative $500,000 in Q1 2014 18
Slide 19: Financial Highlights - Q1 2015
Financial Highlights - Q1 2015 • Balance sheet at the end of Q1 remained robust • Cash position stood at $32 million • Net debt at the end of Q1 stood at $356.4 million, up from $315.7 million at the end of Q4 2014 • Net debt to LTM EBITDA ratio remained solid at 2.8 times 19
Slide 20: Mario Gosselin, Chief Executive Officer
MARIO GOSSELIN CHIEF EXECUTIVE OFFICER 20
Slide 21: Corporate Social Responsibility
Corporate Social Responsibility • Engaging with the communities • Sustainability 2015 program: – Implemented in order to substantively reduce the impact of our operating activities on the environment – Dedicated website at sustainability2015.ca 21
Slide 22: Corporate Social Responsibility
Corporate Social Responsibility Contribution to a number of social causes and philanthropic activities 22
Slide 23: Looking Ahead
Looking Ahead • Road ahead will present a number of challenges • Commodity prices expected to remain high combined with the lower Canadian dollar • Cost-cutting measures to help protect and maintain margins • Focus high-return CAPEX projects • Continue to assess M&A opportunities in Canada and the U
Slide 24: Looking Ahead
Looking Ahead • Leverage strength of Canadian consumer brands • Capture market share in expanding premium private label market in the U.S. • On-going study to evaluate locations and financing scenarios to expand in the premium tissue market in North America • Optimize operational and strategic syner
Slide 25: Q&A Period
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Slide 26: Thank you
*KP KP Tissue Ine. Thank you See you next year