1. No category

Emmi Group
Financial year 2014
Results Presentation
Lucerne, 24 March 2015
Welcome address
Konrad Graber, Chairman of the Board of Directors
Overview of the financial year 2014
Urs Riedener, CEO
Annual results 2014
Jörg Riboni, CFO
Success factors
Urs Riedener, CEO
Outlook
Urs Riedener, CEO
1
Introduction by Konrad Graber, Chairman of the Board of Directors
Opening remarks about key figures and relevant
influencing factors in the business year 2014
Business year 2014, results' presentation, 24. March 2015
Page 3
Welcome address
Konrad Graber, Chairman of the Board of Directors
Overview of the financial year 2014
Urs Riedener, CEO
Annual results 2014
Jörg Riboni, CFO
Success factors
Urs Riedener, CEO
Outlook
Urs Riedener, CEO
2
2014 at a glance (as published)
Sales as expected, income affected by impairments
§ Net sales CHF 3,404 million
Increase of 3.2 %
§ EBIT CHF 136.2 million
Decline of 19.2 %
– EBIT margin 4.0 % (2013: 5.1 %).
§ Net profit CHF 78.9 million
Decline of 24.6 %
– Net profit margin 2.3 % (2013: 3.2 %).
2014: EBIT and net profit including non-recurring effects of CHF -34.5 million and CHF -30.5 million respectively. These
resulted from an impairment charge in Italy (Trentinalatte) as well as from the extraordinary gains on the sale of entities,
businesses and properties.
2013: EBIT and net profit including non-recurring effects of CHF 8.5 million and CHF 7.0 million respectively. These
resulted solely from the extraordinary gains on the sale of property, plant and equipment.
Business year 2014, results' presentation, 24. March 2015
Page 5
2014 at a glance (adjusted)
Adjusted income significantly higher than last year
§ Net sales CHF 3,404 million
increase of 3.2 %
§ EBIT, adjusted CHF 170.7 million
Increase of 6.7 %
– EBIT margin, adjusted, 5.0 % (2013: 4.9 %).
§ Net profit, adjusted CHF 109.4 million
Increase of 12.1 %
– Net profit margin, adjusted, 3.2 % (2013: 3.0 %).
2014: EBIT and net profit adjusted for non-recurring effects of CHF -34.5 million and CHF -30.5 million respectively.
These resulted from an impairment charge in Italy (Trentinalatte) as well as from the extraordinary gains on the sale of
entities, businesses and properties.
2013: EBIT and net profit adjusted for non-recurring effects of CHF 8.5 million and CHF 7.0 million respectively. These
resulted solely from the extraordinary gains on the sale of property, plant and equipment.
Business year 2014, results' presentation, 24. March 2015
Page 6
3
Review of the year: first half of 2014
Small events make the difference
Innovation
Emmi Chai Latte
January
Sustainability motto: 10 years
Intelligent mobility
Emmi Caffè Latte
February
GM with record
attendance
March
April
Nils Mani:
Newcomer
of the year
May
New
Mozzarella recipe
June
Business year 2014, results' presentation, 24. March 2015
Page 7
Review of the year: second half of 2014
Small events makes the difference
New
Headquarters
July
Increase
in stake
Gläserne Molkerei
August
New varieties
Jogurtpur
September
Business year 2014, results' presentation, 24. March 2015
Investment in the
Logistics Centre
Ostermundigen
October
Gold for Kaltbach Repurchase of a 34%
package of shares in
Emmi Fondue AG
November
December
Page 8
4
Sales split by division
CH: Growth slightly exceeded expectations; Intl: Expectations just met
Switzerland
§ Sales CHF 1,888 million
– Increase of 1.3 % (organic 1.2 %)
Americas
§ Sales CHF 840 million
– Increase of 2.7 % (organic 7.1 %)
Europe
§ Sales CHF 509 million
– Increase of 8.3 % (organic 0.0 %)
Global Trade
§ Sales CHF 167 million
– Increase of 13.2 % (organic 13.2 %)
Net sales Group 2014: CHF 3,404 million
Business year 2014, results' presentation, 24. March 2015
Page 9
Sales by region
Around one fifth of sales achieved in growth markets
Americas
25 % (CHF 840 million)
2013:
Switzerland 56 %
Americas 25 %
Europe 14 %
Global Trade 5 %
Europe
15 % (CHF 509 million)
Global Trade
5 % (CHF 167 million)
Top 5, sales:
Switzerland
USA
Spain
Italy
Tunisia
Switzerland
55 % (CHF 1,888 million)
Net sales Group 2014: CHF 3,404 million
Business year 2014, results' presentation, 24. March 2015
Page 10
5
Sales by product group
Three strong product group, no changes compared with 2013
Fresh products
25 % (CHF 848 mio.)
Dairy products
30 % (CHF 1,031 mio.)
2013:
Cheese 32 %
Dairy products 30 %
Fresh products 25 %
Fresh cheese 5 %
Powder/concentrates 3 %
Other products/services 5 %
Other products/services
5 % (CHF 153 mio.)
Powder/concentrates
3 % (CHF 110 mio.) Fresh cheese
5 % (CHF 183 mio.)
Cheese
32 % (CHF 1,079 mio.)
Net sales Group 2014: CHF 3,404 million
Business year 2014, results' presentation, 24. March 2015
Page 11
Facts and figures 2010 – 2014
Adjusted EBIT and net profit bring record result
in CHF million
2014
2013
2011
2010
Net sales
3,404
293.1
3,298
280.1
2,981
271.4
2,721
2,684
239.3
233.6
8.6
8.5
9.1
8.8
8.7
170.7
160.0
146.3
130.3
135.8
5.0
4.9
4.9
4.8
5.1
109.4
97.6
90.3
83.0
86.1
3.2
3.0
3.0
3.0
3.2
3,701
992
Earnings before interest, taxes, depreciation and
amortisation (EBITDA)
as % of net sales
Earnings before interest and taxes (EBIT)*
as % of net sales
Net profit*
as % of net sales
2012
Headcount (full-time equivalents)
5,207
5,217
5,074
3,890
Volume of milk and cream processed (in mio. kg)
1,702
1,465
1,220
1,017
2014: EBIT and net profit adjusted for non-recurring effects of CHF -34.5 million and CHF -30.5 million respectively. These resulted from an impairment charge in Italy (Trentinalatte) as
well as from the extraordinary gains on the sale of entities, businesses and properties.
2013: EBIT and net profit adjusted for non-recurring effects of CHF 8.5 million and CHF 7.0 million respectively. These resulted solely from the extraordinary gains on the sale of property,
plant and equipment.
Business year 2014, results' presentation, 24. March 2015
Page 12
6
Sales trend – Group
Group growth 3.2 %, organic growth 3.0 %
Group sales
in CHF million
+1.3 %
-1.1 %
+3.0 %
3,404.0
3,298.2
Sales
2013
Acquisition
effect
FX effect
Organic
growth
Sales
2014
Business year 2014, results' presentation, 24. March 2015
Page 13
Sales trend 2014 Business division Switzerland
Organic growth in all key areas
Sales, Switzerland
in CHF million
+0.1 %
+0.0 %
Dairy products
Sales CHF 710.1 million, +1.7 % (org. +1.7 %)
- Higher milk prices
- Slightly lower volumes
+1.2 %
1 888.1
1 863.1
Cheese
Sales CHF 554.9 million, +2.4 % (org. +1.2 %)
- Growth in Kaltbach, Der Scharfe Maxx, Le Petit Chevrier
- Decline in AOP cheese
- Positive acquisition effect of Käserei Studer
Fresh products
Sales CHF 343.3 million, -0.7 % (org. +0.5 %)
- Double-digit growth in Emmi Caffè Latte
- Positive boosts from Jogurtpur
- Decline in milk drinks without coffee
- Negative acquisition effect Nutrifrais
Sales
2013
Acquisition
effect
FX effect
Organic
growth
Business year 2014, results' presentation, 24. March 2015
Sales
2014
(Effect of higher milk price in business division Switzerland:
CHF 31 million)
Page 14
7
Sales trend 2014 Business division Americas
Significant organic growth through brand concepts
Sales, Americas
in CHF million
+0.0 %
-4.4 %
Cheese
Sales CHF 315.4 million, +3.8 % (org. +6.6 %)
- Growth in locally manufactured cow’s and
goat’s milk cheese
- Growth in Kaltbach
- Decline in export of AOP cheese
+7.1 %
840.0
817.6
Dairy products
Sales CHF 267.1 million, +1.8 % (org. +8.0 %)
- Significant growth in Tunisia
Fresh products
Sales CHF 197.7 million, +4.5 % (org. +8.8 %)
- New dessert line increases sales in Tunisia
- Kaiku ("sin lactosa" and Caffè Latte in particular)
performs well in Spain
- Double-digit growth by Emmi Caffè Latte in Spain
Sales
2013
Acquisition
effect
FX effect
Organic
growth
Sales
2014
Business year 2014, results' presentation, 24. March 2015
Page 15
Sales trend 2014 Business division Europe
Situation in Italy and AOP cheese price war put brakes on growth
Sales, Europe
in CHF million
+8.9 %
-0.6 %
Fresh products
Sales CHF 257.5 million, +8.0 % (org. +1.6 %)
- Growth in Emmi Caffè Latte
- Desserts (Bontà Divina, Rachelli) perform well
- Decline in the Italian yogurt business
- Acquisition effect of Rachelli
0.0 %
508.8
469.9
Cheese
Sales CHF 136.3 million, -5.6 % (org. -5.4 %)
- Growth in Kaltbach and Der Scharfe Maxx
(Germany and Austria)
- Reduced volumes due to price increase in AOP cheese
Fresh cheese
Sales CHF 56.8 million, 6.9 % (org. +8.3 %)
- Above all, cooperation with Venchiaredo, Italy
Sales
2013
Acquisition
effect
FX effect
Organic
growth
Business year 2014, results' presentation, 24. March 2015
Sales
2014
Page 16
8
Welcome address
Konrad Graber, Chairman of the Board of Directors
Overview of the financial year 2014
Urs Riedener, CEO
Annual results 2014
Jörg Riboni, CFO
Success factors
Urs Riedener, CEO
Outlook
Urs Riedener, CEO
Net sales to EBIT
Highest EBIT in Emmi's history (adjusted basis)
in CHF million
Net sales
Gross profit
as % of net sales
Other operating income
Total operating expenses
EBITDA
as % of net sales
Depreciation and
amortisation
Write-back of negative
goodwill
EBIT
as % of net sales
2013 ∆ in %
2014
3,404.0 3,298.2
3.2
1,129.1 1,089.2
3.7
33.2
33.0
11.5
9.6
-847.5
-818.7
3.5
293.1
280.1
4.6
8.6
8.5
-157.4
-112.3
40.2
0.5
0.7
-28.6
136.2
168.5
-19.2
4.0
5.1
34.5
-8.5
Adjusted EBIT
170.7
160.0
as % of net sales
5.0
4.9
Including special effects
19.8
Business year 2014, results' presentation, 24. March 2015
§ Trentinalatte impairment
resulted in markedly negative
non-recurring effects
§ Acquisitions and investments in
software resulted in greater ordinary
depreciation and amortisation
§ At 5.0 %, adjusted EBIT margin slightly
improved
6.7
Page 18
9
Net sales to gross profit
Gross profit and gross profit margin slightly improved
§ Margins improved as a consequence of:
− Improved product portfolio
− Elimination of unprofitable
3.7
business
− Rationalisation and enhanced
productivity
Net sales
2013 ∆ in %
2014
3.2
3,404.0 3,298.2
Gross profit
1,129.1 1,089.2
in CHF million
as % of net sales
33.2
33.0
§ International: increase in price of
AOP cheese
§ Switzerland: good performance by
high value-added Emmi brands
Business year 2014, results' presentation, 24. March 2015
Page 19
Overview of operating expenses
Disproportionately low increase in operating expenses
in CHF million
2014
2013
∆ in %
Personnel expenses
404.7
398.3
1.6
11.9
12.1
122.3
123.6
as % of net sales
Marketing and sales-related
expenses
-1.1
§ Acquisitions and non-recurring effects
push operating expenses up
§ Increase in operating expenses would
be less than proportionate without nonrecurring effects of CHF 7.5 million
§ Increase in personnel expenses also
markedly less than proportionate
3.6
3.7
Occupancy expense,
maintenance & repair, leasing
73.3
68.0
7.7
Energy, operating materials
and supply
66.7
66.7
95.0
§ Other operating expenses: increase
primarily due to Trentinalatte effects
and IT/administrative costs
4.3
as % of net sales
-
Logistic expenses
99.1
Other operating expenses
81.4
67.1
21.3
Total operating expenses
847.5
818.7
3.5
24.9
24.8
as % of net sales
Business year 2014, results' presentation, 24. March 2015
§ Marketing & Sales: Clear priority setting
Page 20
10
Special effects in the Consolidated Financial Statement
Impairment at Trentinalatte
2014
2013
3.9
-2.9
0.1
8.5
-
Non-recurring effects in EBITDA
Impairment charge at Trentinalatte
1.1
-35.6
8.5
-
Non-recurring effects in EBIT
Taxes on non-recurring effects
-34.5
4.0
-1.5
Non-recurring effects in net profit
-30.5
7.0
in CHF million
Gains on the sale of property, plant & equipment
Impairment charge at Trentinalatte
Gains on the sale of entities and businesses
8.5
Business year 2014, results' presentation, 24. March 2015
Page 21
EBIT drivers
Disproportionate increase in gross profit
Increase in operating expenses less than proportionate
in
CHF million
Gross
profit
+39.9
Personnel
expense
-6.4
Other operating
Disposal of
expenses
PPE, entities
Impairment
& businesses
-14.9
Trentinalatte
-4.5
-38.5
Depreciation/
amortisation
-9.4
Other
positions
1.5
168.5
2013
Business year 2014, results' presentation, 24. March 2015
136.2
2014
Page 22
11
EBIT to net profit
Increase in adjusted profit per share
§ Financial result:
Currency and interest result
significantly improved
2014
2013
∆
136.2
168.5
-32.3
0.8
1.1
-0.3
Financial result
-11.0
-15.7
4.7
Earnings before taxes (EBT)
126.1
153.9
-27.8
Income taxes
-29.0
-30.3
1.3
§ Net profit for 2014 (adjusted)
CHF 109.4 million (NP margin 3.2 %)
§ Earnings per share, adjusted
CHF 20.45 (previous year CHF 18.24)
in CHF million
EBIT
Income from associates and
joint ventures
Average Tax rate in %
23.0
19.7
Minority interests
-18.2
-19.0
0.8
Net profit
Net profit (adjusted)
78.9
109.4
104.6
97.6
-25.7
11.8
20.45
18.24
+2.21
Earnings per share, CHF, adjusted
§ High income tax rate specially due to
non-recurring effects
(adjusted rate: 20.5 %).
Business year 2014, results' presentation, 24. March 2015
Page 23
Cash flow (1/2)
Strong cashflow
in CHF million
Operating cash flow
2014
283.7
∆
2013
271.8
11.9
-45.9
-5.1
40.8
Tax and interest paid
-47.5
-48.4
0.9
Cash flow from operating activities
231.1
264.2
-33.1
12.4
Change in net working capital
-104.3
-116.7
Investments in intangible assets
-14.1
-9.5
-4.6
Acquisition of holdings
-50.3
-65.8
15.5
25.6
Investments in property, plant and equipment
39.6
14.0
Cash flow from investing activities
-129.1
-178.0
48.9
Cash flow from financing activities
Currency translation
-77.9
26.7
Other investments/divestments
Net change in cash and cash equivalents
Business year 2014, results' presentation, 24. March 2015
2.3
-0.6
-104.6
2.9
26.4
112.3
-85.9
Page 24
12
Cash flow
Investments 2014
Replacement investments
§ SAP business software (Switzerland)
§ IT infrastructure (Switzerland)
§ Emmi headquarters, interior work (Lucerne, CH)
§ Renovation of staff infrastructure (Emmen, CH)
Expansion investments
§ Cheese production (Landquart, CH)
§ Fruit preparation (Emmen, CH)
§ Goats' cheese production (Arcata, USA)
§ Desserts (Mahdia, Tunisia)
24%
41%
35%
Rationalisation investments
§ Milk pasteurisation and
filtration (Suhr, CH)
§ Reconversion of frozen goods store
(Ostermundigen, CH)
§ Location development (Dagmersellen, CH)
§ Energy supply (Mahdia, Tunisia)
Total investments in 2014: CHF 118.4 million
Business year 2014, results' presentation, 24. March 2015
Page 25
Key figures for 2014 (1/3)
Net debt/EBITDA
in CHF million
Factor
§ Net debts further reduced
400
359
350
3
321
295
300
241
250
2
200
§ Net debt/EBITDA ratio well below
specified limits
§ Further increase in financing potential
for additional investments
180
150
1.34
1.34
100
50
1
1.05
0.82
0.77
0
0
2010
Net Debt
2011
2012
Net Debt / EBITDA Ratio
2013
2014
Net debt/EBITDA ratio limit
Business year 2014, results' presentation, 24. March 2015
Page 26
13
Key figures for 2014 (2/3)
Equity ratio
in CHF million
in %
2500
70
56.5
2000
60
52.4
50.2
51.9
50.3
50
1500
1729
1949
§ Equity ratio even more stable and hence
still well in excess of requirements
§ Scope for additional financing still secure
40
2323
2532
2500
30
1000
20
500
10
0
0
2010
2011
Balance sheet total
2012
2013
2014
Target equity ratio in %
Equity share in %
Business year 2014, results' presentation, 24. March 2015
Page 27
Key figures for 2014 (3/3)
Dividend, dividend distribution
in CHF
20
20.45
21.1
21.9
16
16.10
21.3
16.88
20.8
18.24
in %
24
22
18.6
20
18
15.51
16
12
14
12
10
8
8
6
4
§ The Board of Directors is proposing to
the General Meeting a dividend of
CHF 3.80, the same as in 2013.
§ Because of the challenges presented
by the strong franc, the dividend ratio is
below the defined bandwidth.
§ The bandwidth of 20 % to 25 % remains
as a guideline for subsequent years.
4
3.40
3.40
3.60
3.80
2010
2011
2012
2013
3.80
2014
0
2
0
EPS
Dividend
Pay-out ratio
(2012, 2013 and 2014: adjusted EPS)
Business year 2014, results' presentation, 24. March 2015
Page 28
14
Welcome address
Konrad Graber, Chairman of the Board of Directors
Overview of the financial year 2014
Urs Riedener, CEO
Annual results 2014
Jörg Riboni, CFO
Success factors
Urs Riedener, CEO
Outlook
Urs Riedener, CEO
Emmi is continuing to pursue its international strategy
Emmi's strategic pillars
Strengthening the position in Switzerland
International growth
Cost management
Business year 2014, results' presentation, 24. March 2015
Page 30
15
Innovation spirit as part of the organisation’s story
Chai Latte
Innovations scored again in 2014
Onken Müesli
Minicol
Swiss
Müesli
Gala
Mousse
Luzerner
Yogodu
Emminent
Gala
Sweet Paprika
Création Yoghurt
Choco Latte
2007
2005 2006
Winzer
SwissAlp
Cheese
2008
Caffè Latte
Zero
Kaltbach
Extra
Energy
Milk
Caffè Latte
Intenso
2009
2010
Yogurt Milk
Luzerner slices
Kaltbach
Fondue
Yogi Drink
Milk
Shake
2011
Mini Marinati
Mozzarella
Kaltbach Raclette
Vitalait Dolce
Caffè Latte
Vanilla
Jogurtpur
new varieties
Kaltbach
Creamy
2012
2013
Gala
herbs, chilli
2014
Tigre
YoQua
Mix-it
Müesli
Onken
seasonal
varieties
Cheese
slices
Jogurtpur
Drinkpur
ECL
Mr Big
Aktifit
new varieties
Fondue
without alcohol
Lassi
2015
Good Day
Kaltbach
single hh
packages
Mozzarella Creminis
Energy Milk
new varieties
Jogurtpur
new varieties
Business year 2014, results' presentation, 24. March 2015
Page 31
Innovation based on mega trends
Relevant food trends for Emmi
Indulgence
Health/wellbeing
Lactose Free
Convenience
Sustainability
Bio
Business year 2014, results' presentation, 24. March 2015
Page 32
16
Clear priorities also with regard to innovations
Strong focus on trends increases chances of success
=
+
Business year 2014, results' presentation, 24. March 2015
Page 33
Key products: Emmi Caffè Latte
Constantly updated marketing mix makes for enormous dynamism
Indexed sales
2007 = 100
200
175
150
+12%
125
100
+13%
75
50
25
0
2007
2008
2009
CH
2010
2011
2012
Export
Business year 2014, results' presentation, 24. March 2015
2013
2014
Page 34
17
Promotion of brands with potential
Initiatives in Global Categories
1
Drinks
2
Spoonable
3
Cheese specialities
Storytelling
4
Desserts
Placements
-
Convenience
Expansion of distribution
New forms of presentation
New packaging sizes
Business year 2014, results' presentation, 24. March 2015
Page 35
Operational Excellence transfer of know-how from CH to other countries
International
Conditions
forOperations:
successfulSummary
international implementation
§ Clear prioritisation of operational excellence
projects at locations
§ Top-down commitment and strong
management
§ Consistent involvement of local employees
§ Tailored programmes rather than
standardised measures
§ Transfer of expert know-how and benefits of
best practice
Business year 2014, results' presentation, 24. March 2015
Page 36
18
The success factors: Operational Excellence (1/2)
Spot on: Lácteos de Navarra (Kaiku), Spain
Initial situation
Measures
Results
- Varying processes
- Improvement programme with a
focus on costs – quality – safety
- Double-digit reduction in:
- Costs of errors/complaints
- Accidents
- Local employees' know-how
poorly used
- Failure costs higher
than Emmi average
- Much more involvement of
employees
- Knowhow transfer CH – Spain
- Lengthy changeover times
- Reduction of temporary staff
- Increased capacity per machine
with consequent option of
deferring replacement investment
Business year 2014, results' presentation, 24. March 2015
Page 37
The success factors: Operational Excellence (2/2)
Spot on: Surlat, Chile
Initial situation
Measures
Results
- Poorly coordinated processes
- Assessment of processes
- Output increased by 25 %
- Employees largely uninvolved
- Rollout of improvement teams
- Reduced changeover times
- Lengthy changeover times
- Elimination of one product line
- Frequent packaging bottlenecks
- Rollout of a
Performance Control System
- Insufficient deliverability
- New packaging materials
- New logistics management
Business year 2014, results' presentation, 24. March 2015
Page 38
19
Welcome address
Konrad Graber, Chairman of the Board of Directors
Overview of the financial year 2014
Urs Riedener, CEO
Annual results 2014
Jörg Riboni, CFO
Success factors
Urs Riedener, CEO
Outlook
Urs Riedener, CEO
The market environment in 2015
Influential factors
Positive
Limiting
Switzerland
International
§
Innovations
§
§
§
§
Brand development
Established product concepts
Operational Excellence
programmes
§
§
§
§
§
§
Significant price pressure
Increasing import pressure
Increased retail tourism
Downturn in tourism
Business year 2014, results' presentation, 24. March 2015
§
§
§
§
Org. growth (A-27, Roth, Cypress Grove
Chevre, Caffè Latte)
Markets: USA, Spain and Tunisia
Additional production capacities USA &
Italy
Operational Excellence (Tunisia, Spain,
USA)
Acceptance of price increases in
EUR countries
Loss of volume due to exchange rate
disadvantages
Currency developments in Chile and
Tunisia
Page 40
20
Effects of the strong Swiss franc
Emmi exports Swiss products worth CHF 400 million
Americas
Global Trade
§
Business division Americas:
Exports to Spain
§
Business division Europe: Exports to
Italy, Germany, Austria, Benelux
§
Business division Global Trade:
All exports
Europe
Switzerland
Business year 2014, results' presentation, 24. March 2015
Page 41
Strength of the franc: consequences for net profit
Primary and secondary effects are significant
Primary effects
− Declining sales and income outside Switzerland in
response to fall in value of euro
− Valuation losses on monetary balance sheet positions
− Lower purchasing costs in euro (positive)
Secondary effects
− Loss of volume following price increases abroad
− Loss of volume in Switzerland due to shopping tourism and
downturn in tourism
− Price adjustments, import pressure
Business year 2014, results' presentation, 24. March 2015
Page 42
21
Strength of the franc: Measures to mitigate its effects
Two main lines of action
Price increases outside Switzerland
Savings at Emmi
Third-party measures:
Suppliers in Switzerland and abroad
All links of the value chain are affected
The measures will enable many of the losses to be compensated for
Measures within Emmi total in excess of CHF 30 million
Business year 2014, results' presentation, 24. March 2015
Page 43
Sales growth 2006 to 2014 and medium-term target
Desired 50/50 share delayed by the strength of the franc, but still realistic
in CHF million
3500
3298
3404
2981
3000
2671
2619
625
675
2684
2721
732
811
2501
2500
2335
2000
509
587
1139
1435 1516
1500
1000
2046
1826
1944
1952
1910
1842 1888
1842
1909 1863
2011
2012 2013 2014 2015
45 %
50 %
55 %
50 %
1914
500
0
2006
2007
2008
International
2009
2010
Switzerland
Business year 2014, results' presentation, 24. March 2015
Page 44
22
Currency translation effets slowed down sales development significantly
At 2007 exchange rates, sales would be more than CHF 500 mio. higher
in CHF mio.
0
-20
-30
-40
-31
-51
-51
-60
-80
-100
-99
-120
-126
-140
-137
-160
2008
2009
2010
2011
2012
2013
2014
Page 45
Business year 2014, results' presentation, 24. March 2015
Currency translation effets slowed down sales development significantly
At 2007 exchange rates, 50/50-share would have been reached in 2013
in percent
in CHF mio.
4'500
51%
52%
4'000
35%
3'500
23%
24%
27%
40%
30%
30%
3'000
1'910
2'500
587
656
736
845
1'050
2'042
20%
10%
1'477
0%
2'000
10%
1'500
1'000
60%
50%
45%
20%
1'914
2'046
1'944
1'952
1'910
30%
1'842
1'863
1'888
40%
500
50%
-
60%
2007
2008
International
2009
2010
2011
2012
Switzerland
Share International
Business year 2014, results' presentation, 24. March 2015
2013
2014
Page 46
23
Currency translation effets based on 2014 sales
Impact of 1% change of average exchange rates vs CHF
Currency
Net sales in
mio. CHF
Euro
7.3
US dollar
2.5
Tunisian dinar
1.3
Chilean peso
1.1
All other currencies
1.1
The mentioned figures only include the effecs from translating the income statement of international subsidiaries in CHF. However, currency changes have further primary and secondary
effects on sales and earnings of Emmi. Furthermore, one should also consider the fact that some direct exports from Switzerland are billed in CHF.
Business year 2014, results' presentation, 24. March 2015
Page 47
Outlook for 2015 as a whole
Strong franc hampers Group sales and profit margin
Organic growth in 2015
without future acquisitions,
profit
Sales Group
-3 % to -2 %
Sales Switzerland
-3 % to -2 %
Sales Americas
Sales Europe
EBIT, CHF million
Net profit margin
3 % to 5 %
-6 % to -4 %
150 to 160
just below 3 %
(Details including acquisitions in 2014, without extraordinary influences on results or
currency translation effects)
Business year 2014, results' presentation, 24. March 2015
Page 48
24
Medium-term objectives
Slight increase in Switzerland, marked organic growth internationally
Growth without
acquisitions, profit targets
Sales – Group
2 % to 3 %
Sales in Switzerland
approx. 1 %
Sales Americas
8 % to 10 %
Sales Europe
1 % to 3 %
Net profit margin
2.5 % to 3.5 %
(Figures assume constant exchange rates and raw milk prices; organic)
Business year 2014, results' presentation, 24. March 2015
Page 49
Questions and answers
Business year 2014, results' presentation, 24. March 2015
Page 50
25
Appendix:
Additional information
Financial result
Significantly decreased net financing expenditure
in CHF million
2014
2013
∆
Interest result
-13.5
-15.7
2.2
§ Interest result improved by repayments
made
2.4
-0.1
2.5
§ Positive currency result
Currency result
Other financial result
Total financial result
0.1
0.1
-
-11.0
-15.7
4.7
Business year 2014, results' presentation, 24. March 2015
§ Increased income from securities
Page 52
26
Geographic distribution of divisions
Country overview
Business year 2014, results' presentation, 24. March 2015
Page 53
Organisational structure
Present-day
structure
reflects increasing internationalisation
New
organisational
structure
CEO
Corporate Development
Finance & Controlling/Legal
International Operations
HR
Quality Management
Corporate Communications & IR
Switzerland
Americas
Europe
Global categories & marketing (incl. R&D coordination)
Drinks
Cheese specialities
Spoonable
Desserts
Global Trade Model
Global Initiatives
Business year 2014, results' presentation, 24. March 2015
Page 54
27
Profit development seven-year comparison
Adjusted EBIT and net profit margins slightly higher
%
10
8.7
9
8.8
9.1
8.0
8.2
8.6
8
7
6.8
6
5.1
5
4
3.8
4.8
4.9
4.9
5.0
3.2
3.0
3.0
3.0
3.2
2010
2011
2012
2013
2014
4.2
3
2.9
2
2.2
1
0
2008
2009
EBITDA margin
EBIT margin
Net profit
(2012, 2013 and 2014 are adjusted figures)
Business year 2014, results' presentation, 24. March 2015
Page 55
Sustainability as part of our company policy
Main environmental measures, 2009 to 2014 (Emmi in Switzerland)
1990s
Environmental organisation
1997
Environmental management
in accordance with ISO 14001
2005 – Dagmersellen
Changeover from oil to
natural gas/biogas heating
2006 – Dagmersellen
Use of tepid water
in cooling processes
until 2008
2009
2006 - Landquart
Use of milk cream in cooling processes
2008 - Ostermundigen
Heat generation
from waste water
2008 – Biedermann Dairy
Solar energy from
photovoltaic plant
Landquart
heat recovery
from compressed air
LESA Bever
Solar energy facility
for process water
Ostermundigen
heat recovery
from waste gas,
Energieverbund Mösli
Ostermundigen
Energy produced from coffee
grounds (Caffè Latte)
2010
2011
Moudon
Heat generated
by new air
compressors
Ostermundigen
Recovery of heat
from compressors
Emmen
Heat generation
using ventilation energy
2012
Sustainability motto for 2013
Closing materials cycles
Dagmersellen
Installation of micro-gas turbine
Logistics
Partnership with railCare (Coop)
2013
2014
Ostermundigen
Use of process heat to preheat water for brewing
Saignelégier
High-temperate solar plant for
process water
Sustainability
motto for 2014
Intelligent
use of
mobility
Suhr
Extraction of infrastructure heat for use
in water heating
Multiple use of tepid water
2008 - Emmen
New woodchip-fired
steam plant
Business year 2014, results' presentation, 24. March 2015
Page 56
28
Emmi Switzerland environment index compared over six years
Significant reduction in emissions, with biggest reduction in waste
Index
%
100
90
80
70
60
50
2009
2010
Produkteabsatz
2011
2012
Stromverbrauch
2013
Wasserbezug
2014
Abfall an KVA
Business year 2014, results' presentation, 24. March 2015
Page 57
Milk and cream volumes processed by Emmi in Switzerland
Emmi processes over 1000 million kg
Record level in 2014
Milk suppliers in Switzerland in 2014
Switzerland
in kg millions
1000
800
69
84
74
90
69
96
63
93
68
97
789
807
786
805
842
Milchverband
beider Basel
MIBA
Nordostmilch
Direct suppliers, other
600
400
34%
36%
200
0
2010
2011
Traditional milk
2012
Organic milk
2013
2014
Central Switzerland
Milk Producers
ZMP
Cream
Business year 2014, results' presentation, 24. March 2015
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29
Milk price development in 2014
Increased price gap Switzerland – Germany as of end 2014
Milk price comparison (Industrial milk, all classes, Swiss cents / kg milk)
70
65
60
55
50
45
40
35
30
Jan
Feb
CH 2013
Mar
Apr
May
CH 2014
June
July
Aug
Germany 2013
Sept
Oct
Nov
Dec
Germany 2014
Source: BLW, AMI
Business year 2014, results' presentation, 24. March 2015
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30