Bunzl Plc · LSE:BNZL
Bunzl — H1 2008 Earnings Presentation
28 slides from Bunzl's earnings presentation, 2008
Slide 1: Interim Results 2008
INTERIM RESULTS 2008 -0- 2008 Interim Results Presentation
Slide 2: Agenda
Agenda 1. Anthony Habgood, Chairman: Welcome 2. Brian May, FD: Financial Results 3. Michael Roney, CEO: Business Review 4. Q&A -1- 2008 Interim Results Presentation
Slide 3: Agenda
Agenda 1. Anthony Habgood, Chairman: Welcome 2. Brian May, FD: Financial Results 3. Michael Roney, CEO: Business Review 4. Q&A -2- 2008 Interim Results Presentation
Slide 4: Financial Summary
Financial Summary Growth % Constant Reported Exchange Revenue 14 10 Operating profit* 15 10 Adjusted eps* 14 9 Dividend per share 11 Return on operating capital 60% Operating cash flow to operating profit* 89% *Before intangible amortisation -3- 2008 Interim Results Presentation
Slide 5: Exchange Rates
Exchange Rates Half year Half year Full year 2008 2007 2007 US$ 1.97 1.97 2.00 €S$ 1.29 1.48 1.46 • Currency impact largely translation • At current rates expect positive impact in 2008 -4- 2008 Interim Results Presentation
Slide 6: Income Statement
Income Statement Growth % Constant £m June 08% June 07% Reported Exchange Revenue 1,964.2% 1,725.6% 14 10 % Operating profit* 128.6% 111.7% 15 10 Margin* 6.5% 6.5% *Before intangible amortisation -5- 2008 Interim Results Presentation
Slide 7: Income Statement
Income Statement Growth % Constant £m June 08) June 07) Reported Exchange Operating profit* 128.6) 111.7) 15 10 Net finance cost (17.8) (11.4) Profit before tax* 110.8) 100.3) 10 5 Effective tax rate (%) 31.6) 31.3) Adjusted earnings per share* (p) 23.7) 20.7) 14 9 Dividend per share (p) 6.45) 5.8)
Slide 8: Balance Sheet
Balance Sheet £m June 08) Dec 07) June 07) Intangibles 1,092.2) 990.3) 784.4) Tangibles 97.3) 91.0) 76.3) Working capital 342.6) 313.8) 315.9) Other liabilities (271.6) (238.1) (212.3) 1,260.5) 1,157.0) 964.3) Pension deficit (36.8) (13.2) (13.8) Net debt (730.5) (667.6) (495.4) Equity 493.2) 476.2)
Slide 9: Cash Flow
Cash Flow £m June 08)% June 07)% Operating profit* 128.6)% 111.7)% Depreciation 9.3)% 7.4)% Working capital movement (9.3)% (13.0)% Other (4.2)% (3.5)% † Cash flow from operations 124.4%) 102.6% ) Net capital expenditure (9.8)% (8.5)% Operating cash flow 114.6%) 94.1%) Operating cash flow to operati
Slide 10: Cash Flow
Cash Flow £m June 08) June 07) Operating cash flow 114.6) 94.1) Interest (21.1) (12.3) Tax (27.3) (32.9) Free cash flow 66.2) 48.9) Dividends (18.6) (17.6) Acquisitions (75.2) (19.2) Share buy back –) (72.6) Special pension contribution –) (9.5) Other 1.2) 3.7) Net cash flow (26.4) (66.3) -9- 2008 I
Slide 11: Continued Track Record of Growth
Continued Track Record of Growth Revenue (£bn) Operating profit* (£m) 2.0 129 1.7 112 H1 07 H1 08 H1 07 H1 08 Adjusted eps* (p) Operating cash conversion (%) 89 23.7 84 20.7 H1 07 H1 08 H1 07 H1 08 *Before intangible amortisation -10- 2008 Interim Results Presentation
Slide 12: Agenda
Agenda 1. Anthony Habgood, Chairman: Welcome 2. Brian May, FD: Financial Results 3. Michael Roney, CEO: Business Review 4. Q&A -11- 2008 Interim Results Presentation
Slide 13: H1 Business Area Analysis
H1 Business Area Analysis Revenue Operating profit* 5% 6% 20% 23% 43% 48% 27% 28% North America UK & Ireland Continental Europe Rest of the World Diversified by geography *Before intangible amortisation and corporate costs -12- 2008 Interim Results Presentation
Slide 14: Sector Resilience
Sector Resilience Healthcare Grocery Non-Food Foodservice Retail Cleaning Other & Safety c.75% revenue from resilient markets -13- 2008 Interim Results Presentation
Slide 15: North America
North America Growth % Constant £m June 08% June 07% Reported Exchange Revenue 931.7% 905.1% 3 2 Operating profit* 58.6% 58.5% 0 0 Margin* 6.3% 6.5% Return on operating capital 72.8% 70.4% • Steady organic revenue growth • Margin declined principally due to increase in fuel costs • Fuel surcharge in
Slide 16: UK & Ireland
UK & Ireland Growth % Constant £m June 08% June 07% Reported Exchange Revenue 537.7% 467.2% 15 14 Operating profit* 37.8% 32.1% 18 17 Margin* 7.0% 6.9% Return on operating capital 61.5% 64.4% • Strong growth in revenue and operating profit • Account wins offset slower market growth in horeca • Good
Slide 17: Continental Europe
Continental Europe Growth % Constant £m June 08% June 07% Reported Exchange Revenue 401.5% 291.4% 38 20 Operating profit* 32.5% 24.4% 33 16 Margin* 8.1% 8.4% Return on operating capital 48.5% 49.7% • Strong growth in revenue and operating profit • Growth in national accounts in France Hygiène • Subs
Slide 18: Rest of the World
Rest of the World Growth % Constant £m June 08% June 07% Reported Exchange Revenue 93.3% 61.9% 51 32 Operating profit* 7.9% 4.5% 76 52 Margin* 8.5% 7.3% Return on operating capital 55.7% 48.8% • Substantial increase in revenue and operating profit • Australasia • Strong organic growth in largest bus
Slide 19: 2008 Acquisitions
2008 Acquisitions Business Acquired Country Sector Revenue Günter Guest Supplies January Germany Horeca €9m Prot Cap February Brazil Safety R$118m Salgo April Australia Horeca A$32m Worldpack June Netherlands Non-Food Retail €19m A&E Russell July United Kingdom Safety £21m Hicosa July Spain Cleaning
Slide 20: Strategy
Strategy • Organic growth • Acquisition growth • Operating model efficiencies -19- 2008 Interim Results Presentation
Slide 21: Organic Growth Model
Organic Growth Model Benefits for Customers • One stop shop • One point of contact • One invoice • Globally sourced products • Management information • Lower working capital • Flexible delivery schedule One stop shop for non-food consumables -20- 2008 Interim Results Presentation
Slide 22: Organic Growth Model: Growing existing businesses
Organic Growth Model New Customers Drivers of Organic Growth Extend Product Categories Growth Sectors and Geographies Growing existing businesses -21- 2008 Interim Results Presentation
Slide 23: Acquisition Growth Model: Expanding geographically
Acquisition Growth Model 23 countries 18 countries 12 countries 7 countries 1997* 2003* 2005* 2008 Expanding geographically * Continuing operations -22- 2008 Interim Results Presentation
Slide 24: Acquisition Growth Model: Consolidating & extending
Acquisition Growth Model “Bolt-on” acquisitions • Günter Guest Supplies • Salgo “Anchor” acquisitions • Prot Cap, Brazil (new country) • Marca, Spain (new sector) Consolidating & extending -23- 2008 Interim Results Presentation
Slide 25: Operating Model Efficiencies
Operating Model Efficiencies Focusing on efficiencies in every aspect of the business IT systems as a source of competitive advantage • Radio frequency scanning roll-out • Vehicle routing system Cost control Improving and refining our operating model -24- 2008 Interim Results Presentation
Slide 26: H1 Summary
H1 Summary • Strong growth in revenue, operating profit and eps • High return on operating capital and strong cash flow • Stable organic revenue growth in North America with return on operating capital at 72.8% • Strong overall growth in Europe and Rest of the World • Acquisition expenditure £118m y
Slide 27: Prospects
Prospects North America • Expect similar levels of organic revenue growth UK & • Continued improvement in Southern Syringe Ireland • Ongoing integration of 2007 acquisitions Continental Europe • Positive impact from recent acquisitions Rest of the World • Strong growth expected Despite increasingly
Slide 28: Your Questions
Your Questions YOUR QUESTIONS -27- 2008 Interim Results Presentation