2017 CAPITAL MARKETS EVENT SEPTEMBER 2017

Transcription

1 2017 CAPITAL MARKETS EVENT SEPTEMBER 2017

2 INTRODUCTION: FRANK VAN ZANTEN CHIEF EXECUTIVE CAPITAL MARKETS EVENT SEPTEMBER

3 AGENDA INTRODUCTION: FRANK VAN ZANTEN UK & IRELAND: ANDREW TEDBURY CONTINENTAL EUROPE: PAUL BUDGE BREAK LATIN AMERICA: JONATHAN TAYLOR NORTH AMERICA: PAT LARMON CLOSE: FRANK VAN ZANTEN CAPITAL MARKETS EVENT SEPTEMBER

4 WHAT MAKES BUNZL UNIQUE? ONE-STOP-SHOP ESSENTIAL PRODUCTS ENTREPRENEURIAL CULTURE LOW VALUE, BULKY PRODUCTS DECENTRALISED MANAGEMENT STRUCTURE BUNZL SMALL % OF CUSTOMER SPEND GEOGRAPHICAL SPREAD ACROSS 30 COUNTRIES DIVERSIFIED ACROSS SIX MARKET SECTORS BESPOKE CUSTOMER SOLUTIONS GLOBAL SCALE CAPITAL MARKETS EVENT SEPTEMBER

5 VALUE PROPOSITION Outsourcing adds value for our customers COST TO ACQUIRE PRODUCT COST COST TO PROCESS INVENTORY INVESTMENT CASH FLOW DIRECT LABOUR & OVERTIME INVENTORY FINANCE COST EXPEDITED ORDERS INBOUND FREIGHT PURCHASE ORDER ADMINISTRATION INVENTORY DAMAGE & SHRINKAGE ACCOUNTS PAYABLE ADMIN STORAGE SPACE CAPITAL EMPLOYED In-house procurement and self-distribution is costly Bunzl applies its resources and expertise to reduce or eliminate many of the "hidden" costs of in-house procurement and self-distribution The benefits to customers are a lower cost of doing business and reduced working capital and carbon emissions CAPITAL MARKETS EVENT SEPTEMBER

6 UK & IRELAND: ANDREW TEDBURY THE BUNZL SERVICE OFFERING TO SKANSKA AND COMPASS CAPITAL MARKETS EVENT SEPTEMBER

7 UK & IRELAND OVERVIEW Sector focused 15% of 2016 Group revenue Healthcare Other 2% 29% 20% Foodservice Retail 11% 10% 16% 12% Grocery Cleaning & hygiene Safety CAPITAL MARKETS EVENT SEPTEMBER

8 SERVICE OFFERING ONE-STOP-SHOP ON-TIME IN-FULL DELIVERY DEDICATED FIELD SALES FORCE ONE ORDER ONE DELIVERY ONE INVOICE RANGE OF DELIVERY OPTIONS INCLUDING OWN FLEET Service offering CUSTOMISED DIGITAL SOLUTIONS CUSTOMISED MANAGEMENT INFORMATION LOCAL AND NATIONAL DISTRIBUTION NETWORK EXPERT KNOWLEDGE AND ADVICE OWN BRAND AND MANUFACTURER BRANDED CAPITAL MARKETS EVENT SEPTEMBER

9 INSIGHT Helping our customers to manage their businesses more efficiently DEDICATED FIELD SALES FORCE OWN BRAND AND MANUFACTURER BRAND Quality people Market knowledge Expert advice Simplification Rationalisation Correct choice CUSTOMISED MANAGEMENT INFORMATION Use of data Consumption Compliance CAPITAL MARKETS EVENT SEPTEMBER

10 INSIGHT ENHANCES OUR CUSTOMER OFFERING: CUSTOMER VIDEO Dale Turner: Procurement Director Ian Murphy: Category Development Director CAPITAL MARKETS EVENT SEPTEMBER

11 IMPLEMENTATION Helping our customers to focus on their core activities ONE ORDER ONE DELIVERY ONE INVOICE ON-TIME IN-FULL DELIVERY Ease of business Multiple products Dedicated teams Complex mobilisations RANGE OF DELIVERY OPTIONS INCLUDING OWN FLEET Local & national Flexible solutions CAPITAL MARKETS EVENT SEPTEMBER

12 IMPLEMENTING NEW CUSTOMER CONTRACTS: CUSTOMER VIDEO Dale Turner: Procurement Director Ian Murphy: Category Development Director CAPITAL MARKETS EVENT SEPTEMBER

13 INNOVATION Helping our customers to benefit from the very latest service and product innovation EXPERT KNOWLEDGE AND ADVICE OWN BRAND Brand enhancing Innovation centres Bespoke products Global sourcing CUSTOMISED DIGITAL SOLUTIONS Flexible approach Web & app CAPITAL MARKETS EVENT SEPTEMBER

14 BRINGING INNOVATION TO CUSTOMERS: CUSTOMER VIDEO Dale Turner: Procurement Director Ian Murphy: Category Development Director CAPITAL MARKETS EVENT SEPTEMBER

15 SERVICE OFFERING ONE-STOP-SHOP ON-TIME IN-FULL DELIVERY DEDICATED FIELD SALES FORCE ONE ORDER ONE DELIVERY ONE INVOICE RANGE OF DELIVERY OPTIONS INCLUDING OWN FLEET Service offering CUSTOMISED DIGITAL SOLUTIONS CUSTOMISED MANAGEMENT INFORMATION LOCAL AND NATIONAL DISTRIBUTION NETWORK EXPERT KNOWLEDGE AND ADVICE OWN BRAND AND MANUFACTURER BRANDED CAPITAL MARKETS EVENT SEPTEMBER

16 UK & IRELAND: QUESTIONS CAPITAL MARKETS EVENT SEPTEMBER

17 CONTINENTAL EUROPE: PAUL BUDGE INNOVATION OF THE BUNZL OFFERING TO THE HEALTHCARE MARKET IN THE NETHERLANDS CAPITAL MARKETS EVENT SEPTEMBER

18 CONTINENTAL EUROPE OVERVIEW 48 sector focused businesses 15 countries 18% of 2016 Group revenue France Netherlands Germany Spain Belgium Denmark Switzerland Austria Retail Healthcare 10% 11% Other 5% 28% Foodservice Italy Czech Republic Hungary Romania Slovakia Israel Cleaning & hygiene 27% 12% 7% Grocery Turkey Safety CAPITAL MARKETS EVENT SEPTEMBER

19 C6 AN INNOVATION OF THE BUNZL OFFERING TO THE HEALTHCARE MARKET IN THE NETHERLANDS CAPITAL MARKETS EVENT SEPTEMBER

20 INNOVATING IN THE HEALTHCARE MARKET Helping our customers save money AGEING POPULATION RISING TREATMENT COSTS OVERALL BUDGETARY CONSTRAINTS MATURE MARKET CUSTOMERS NEED TO DELIVER MORE FOR LESS COMMODITISED PRODUCTS AND SERVICES CAPITAL MARKETS EVENT SEPTEMBER

21 TYPICAL HEALTHCARE FACILITY INEFFICIENCIES Key Takeaway CAPITAL MARKETS EVENT SEPTEMBER

22 C6 WINNING THE CUSTOMER DEEP DIAGNOSTIC OF SPEND ON CONSUMABLES (1,500 SKUs) PROCESS ANALYSIS PURCHASING, IT, LOGISTICS, ADMINISTRATION REPORT KEY FINDINGS AND BUNZL PROPOSAL WORKSHOP TO PROVE CONCEPTS AND AGREE HARD SAVINGS BALANCING THE NEED TO SAVE COSTS WITH QUALITY CAPITAL MARKETS EVENT SEPTEMBER

23 C6 TYPICAL OUTCOMES OUTSOURCE PROCUREMENT OF CONSUMABLES RATIONALISATION OF SUPPLIER BASE USE TRACK AND TRACE TO MANAGE PRODUCT DATA TAKE OWNERSHIP OF & MANAGE WAREHOUSING INCLUDING STERILE PRODUCTS JIT DELIVERIES DIRECT TO WARD AND STORAGE CUPBOARDS ORDER VIA SCANNING OR WEBSHOP - AUTOMATIC INTERFACE WITH CUSTOMER S ERP CAPITAL MARKETS EVENT SEPTEMBER

24 C6 AND E-COMMERCE Using our state of the art e-commerce solution to ensure seamless integration for each customer PROCUREMENT PLATFORM LINKS TO BUNZL WEBSHOP BENEFITS : EASE OF USE SHOPPING CART APPROVAL IN ALRIJNE PROCUREMENT PLATFORM ORDER AUTOMATICALLY PLACED IN BUNZL SYSTEM CONTROL OF SPEND VIA AUTHORISATION PROCESS AND CONTROL USE OF DEFINED AND AGREED PRODUCT CATALOGUE CAPITAL MARKETS EVENT SEPTEMBER

25 BUNZL NETHERLANDS C6 IMPLEMENTATION WITH HOSPITAL GROUP RIVAS: CUSTOMER TESTIMONIAL CAPITAL MARKETS EVENT SEPTEMBER

26 BUNZL NETHERLANDS C6 IMPLEMENTATION WITH HOSPITAL GROUP RIVAS: CUSTOMER VIDEO CAPITAL MARKETS EVENT SEPTEMBER

27 BENEFITS OF C6 TO CUSTOMERS REDUCED ADMIN FOR CLINICAL STAFF SIMPLER AND AUTOMATED PROCESSES BETTER PRODUCT PRICING DUE TO BUNZL SCALE IMPROVED SERVICE LEVELS SAVE CUSTOMERS TIME INCREASED PROFITABILITY, EFFICIENCY AND CASH INCREASED OPERATING THEATRE AVAILABILITY REDUCED CARBON FOOTPRINT REDUCED WORKING CAPITAL REDUCED NEED FOR STORAGE SPACE SEPTEMBER 2017 CAPITAL MARKETS EVENT 27

28 CONTINENTAL EUROPE: QUESTIONS CAPITAL MARKETS EVENT SEPTEMBER

29 2017 CAPITAL MARKETS EVENT BREAK CAPITAL MARKETS EVENT SEPTEMBER 2017

30 LATIN AMERICA: JONATHAN TAYLOR DEVELOPMENT OF A BUSINESS AREA CAPITAL MARKETS EVENT SEPTEMBER

31 BUNZL LATIN AMERICA MARKET ENTRY IN ACQUISITIONS 7 COUNTRIES >2,000 EMPLOYEES MEXICO COLOMBIA 6% 14% BRAZIL Cleaning & Hygiene PERU Foodservice 10% 6% Safety CHILE URUGUAY 13% 71% ARGENTINA Healthcare CAPITAL MARKETS EVENT SEPTEMBER

32 LATIN AMERICA EVOLUTION REVENUE ( m) CAPITAL MARKETS EVENT SEPTEMBER

33 BUILDING A BUSINESS AREA 3 stages: From a group of independent companies to a business area COORDINATING COMMON FUNCTIONS INTEGRATION & SYNERGIES Stage 1 Stage 2 PLATFORM FOR GROWTH Stage 3 CAPITAL MARKETS EVENT SEPTEMBER

34 DECENTRALISED MANAGEMENT Commercial and operational decisions stay with local management Ex-owner management Ex-owners given freedom and autonomy to continue to run their businesses Finance director Finance & administration Purchasing Supplier relationships Logistics Operating platform Sales & marketing Customer relationships This principle is key to retaining ex-owner management teams Commercial decisions made locally CAPITAL MARKETS EVENT SEPTEMBER

35 1 COORDINATING COMMON FUNCTIONS FINANCE TAX HUMAN RESOURCES LEGAL & COMPLIANCE IT HEALTH & SAFETY Control & compliance immediate implementation Financial reporting common international standards Management systems business performance and strategy Administrative processes pooling support functions CAPITAL MARKETS EVENT SEPTEMBER

36 2 INTEGRATION & SYNERGIES Company 1 Company 2 Company 3 Company 4 Joint purchasing Joint logistics Company 1+2 Company 3+4 Purchasing Logistics Sales Purchasing Logistics Sales Purchasing Logistics Sales Purchasing Logistics Sales Local purchasing Local logistics Sales segment 1 Local purchasing Local logistics Sales segment 2 Coordination grouping similar businesses creates synergies Purchasing additional volume benefits Logistics rationalisation of distribution facilities Management model ex-owner divisional leadership CAPITAL MARKETS EVENT SEPTEMBER

37 BRAZIL SAFETY 6 safety acquisitions completed 8 distribution centres merged DIVISIONAL LEADERSHIP MARKET INTELLIGENCE Safety division created PURCHASING/IMPORTS Brazil Safety SERVICE INNOVATIONS End-user business Redistribution business CAPITAL MARKETS EVENT SEPTEMBER 2017 Market focused businesses 37

38 3 PLATFORM FOR GROWTH IN BRAZIL Safety acquisitions Hygiene acquisitions Healthcare acquisitions New Sector acquisitions Common digital platforms New acquisitions easily incorporated into structure Common platforms benefit from increasing scale Digital solutions innovations shared across sectors CAPITAL MARKETS EVENT SEPTEMBER

39 GROWTH OPPORTUNITIES LATAM Significant growth opportunities in existing markets and sectors New sector opportunities in existing countries Further potential for new countries COUNTRY FOODSERVICE GROCERY C&H SAFETY RETAIL HEALTHCARE Brazil Chile Colombia Argentina Peru Uruguay Mexico Other Latin America No existing presence 30 new sector opportunities in countries with existing presence 13 potential new country opportunities (excluding Caribbean) CAPITAL MARKETS EVENT SEPTEMBER

40 CONCLUSIONS Rapid acquisition growth brought both scale and organisational complexity Latin America organisational structure created to: manage and control complexity preserve decentralised decision-making capitalise on synergies benefit from increasing scale enable further high growth Latin America presents huge growth potential and we are structured to take advantage CAPITAL MARKETS EVENT SEPTEMBER

41 LATIN AMERICA: QUESTIONS CAPITAL MARKETS EVENT SEPTEMBER

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71 CLOSE: FRANK VAN ZANTEN CHIEF EXECUTIVE CAPITAL MARKETS EVENT SEPTEMBER

72 SUMMARY UK & Ireland - Differentiating our service proposition Continental Europe - Delivering outsourcing solutions through process innovation Latin America - Building a platform for future growth North America - Deepening our customer relationships CAPITAL MARKETS EVENT SEPTEMBER

73 CONSISTENT AND PROVEN COMPOUNDING STRATEGY High ROIC despite significant acquisition spend PROFITABLE ORGANIC GROWTH OPERATING MODEL IMPROVEMENTS Use competitive advantage to grow market share in a profitable way Daily focus on making our business more efficient ROIC 16.4% ACQUISITION GROWTH Use strong balance sheet and excellent cash flow to consolidate our markets further CAPITAL MARKETS EVENT SEPTEMBER

74 FINANCIAL TRACK RECORD Proven compounding growth strategy REVENUE ( bn) 7.4 ADJUSTED OPERATING PROFIT* ( m) 525 CAGR %-11% ADJUSTED EPS* (p) DIVIDEND PER SHARE (p) restated on adoption of IAS 19 (revised 2011) * Before adjusting items (customer relationships amortisation and acquisition related items) and the associated taxation, where relevant continuing operations only CAPITAL MARKETS EVENT SEPTEMBER

75 DISCLAIMER No representation or warranty (express or implied) of any nature can be given, nor is any responsibility or liability of any kind accepted, by Bunzl plc with respect to the completeness or accuracy of the content of or omissions from this presentation. This presentation is for information purposes only and does not constitute and shall not be deemed to constitute an offer document or an offer in respect of securities or an invitation to purchase or subscribe for any securities in any jurisdiction. Persons in a jurisdiction other than the United Kingdom should ensure that they inform themselves about and observe any relevant securities laws in that jurisdiction in respect of this presentation. The presentation does not constitute an offer of securities for sale in the United States. None of the securities described in the presentation have been registered under the U.S. Securities Act of Such securities may not be offered or sold in the United States except pursuant to an exemption from such registration. This presentation contains forward-looking statements. They are subject to risks and uncertainties that might cause actual results and outcomes to differ materially from the expectations expressed in them. You are cautioned not to place undue reliance on such forward-looking statements which speak only as of the date hereof. Bunzl undertakes no obligation to revise or update any such forward-looking statements. Where this presentation is being communicated as a financial promotion it will only be made to and directed at: (i) those persons who have professional experience in matters relating to investments falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the Order ); (ii) those persons falling within Article 49 of the Order; or (iii) to persons outside of the United Kingdom only where permitted by applicable law (all such persons together being referred to as relevant persons ) and must not be acted on or relied on by persons who are not relevant persons. CAPITAL MARKETS EVENT SEPTEMBER