Arne Frank CEO Capital Market Day November 12, 2014
Forward-looking statements This presentation includes forward-looking statements that are subject to risks and uncertainties, including those pertaining to the anticipated benefits to be realized from the proposals described herein. This presentation contains a number of forward-looking statements including, in particular, statements about future events, future financial performances, plans, strategies, expectations, prospects, competitive environment, regulation and supply and demand. AAK has based these forward-looking statements on its views with respect to future events and financial performance. Actual financial performance of the entities described herein could differ materially from that projected in the forward-looking statements due to the inherent uncertainty of estimates, forecasts and projections, and financial performance may be better or worse than anticipated. Given these uncertainties, readers should not put undue reliance on any forward-looking statements. Forward-looking statements represent estimates and assumptions only as of the date that they were made. The information contained in this presentation is subject to change without notice and AAK does not undertake any duty to update the forward-looking statements, and the estimates and assumptions associated with them, except to the extent required by applicable laws and regulations . 2
Agenda 10.00 – 10.40 AAKtion Arne Frank, CEO 10.40 – 11.00 Financial update Fredrik Nilsson, CFO 11.00 – 11.25 I nfant Nutrition Karel Stoschek, Director Infant Nutrition 11.25 – 11.40 Short break w ith sam ples 11.40 – 12.10 Dairy Lena Ingvarsson, Marketing Director Dairy 12.10 – 12.35 Chocolate & Confectionery Fats Anne Mette Olesen, CMO 12.35 – 13.05 Q&A 13.10 – 14.10 Lunch 14.15 – 16.15 Plant visit 3
AAK participants Anders Byström Arne Frank Fredrik Nilsson Karel Stoschek Lena Ingvarsson Anne Mette Olesen Director IR Director Infant President and CEO CFO CMO Marketing Director Nutrition Dairy 4
January – September Volume + 4 % 1,241 (1,196) ’000 MT Organic –2% Sales 12,958 (12,251) + 6 % SEK million EBIT* + 1 3 % 899 (799) SEK million EBIT per kilo* 0.72 (0.67) + 7 % SEK EPS 14.03 (12.39) + 1 3 % SEK 5 * Excluding acquisition costs and non-recurring items
FI – January to September Operating profit ( SEK m illion) Volum es ( '0 0 0 MT) 600 + 5 % 850 + 4 % * 5 8 3 550 800 8 0 7 5 5 3 7 7 6 500 750 450 700 400 650 Last year Actual Last year Actual Operating profit per kilo ( SEK) 0.73 + 1 % 0 .7 2 0.71 0 .7 1 0.69 0.67 0.65 Last year Actual 6 * For comparable units, volumes decreased by 3 percent
FI – January to September Volume EBIT/ kg 325 300 2,50 275 250 2,25 225 200 2010 2,00 175 MT 2011 150 2012 1,75 125 2013 100 2014 1,50 75 2010 SEK/ kg 50 1,25 2011 25 2012 0 1,00 Bakery Food Service Infant Dairy Fat Frying & Nutrition Alternative Other 2013 commodity 0,75 EBIT 2014 275 0,50 250 225 0,25 200 0,00 175 Bakery Food Service Infant Dairy Fat Frying & SEK million 2010 150 Nutrition Alternative Other 2011 125 commodity 2012 100 2013 75 2014 50 25 0 Bakery Food Service Infant Dairy Fat Frying & 7 Nutrition Alternative Other commodity
CCF – January to September Operating profit ( SEK m illion) Volum es ( '0 0 0 MT) 350 + 3 1 % 250 + 5 % * 3 3 2 2 3 0 300 200 2 1 9 250 150 2 5 4 200 100 150 50 Last year Actual Last year Actual Operating profit per kilo ( SEK) 1.60 + 2 4 % 1.40 1 .4 4 1.20 1 .1 6 1.00 0.80 Last year Actual 8 * For comparable units, volumes decreased by 1 percent
Current market growth estimates 0% 0% 0-2% + 6-10% -12-18% + 3-6% + 3-5% 9
AAK y t d vs market growth 0% 0% 0-2% + 6-10% -12-18% + 3-6% + 3-5% 10
Mid/ long term expectations + 3-5% 0-2% 0-2% + 6-10% + 2-5% + 3-6% + 3-5% 11
Since last Capital Market Day AAKtion Acquisitions • CSM Oils & Fats Benelux NV, Belgium • Fanagra, Colombia • Additional brand from Unilever, Turkey Divestment • Binol Greenfields • Brazil • China Product development 12
AAK Acceleration 13
Sales Innovation Service Customer co-developm ent Quality Productivity 14
Raw material prices 1,800 Rapeseed oil Palm oil 1,600 1,400 1,200 1,000 USD/ ton 800 600 400 200 0 15
Cocoa butter price 10,000 9,000 8,000 7,000 6,000 USD/ ton 5,000 4,000 3,000 2,000 1,000 0 16
Medium and fast growing markets* 100% 1 3 % 2 0 % 90% 2 2 % 2 5 % 2 6 % 80% 1 8 % 1 8 % 70% 7 0 % 3 1 % 60% 3 5 % 3 4 % 50% 40% 6 9 % 6 2 % 30% 4 7 % 4 0 % 4 0 % 20% 3 0 % 10% 0% 2006 2009 2012 2013 2014 2015-2016* Slow growing markets Medium growing markets Fast growing markets Nordics USA Asia West Europe CEE Latin America CIS 17 * Management ambition – edible oil volumes
AAK investing in Brazil A new speciality and semi-speciality edible oils factory in Jundiaí, São Paulo, Brazil This investment is expected to amount to approx. SEK 400 million over a two-year period The main start-up of the new factory is planned for the latter part of 2015 The factory will strengthen our ability to locally supply Bakery and Dairy solutions as well as further develop our CCF business in Brazil The new factory will include a state of the art Innovation Center 18
AAK investing in China A new speciality and semi-speciality edible oils factory in Zhangjiagang • The region has the highest GDP per capita in mainland China • Chinese center for inbound and outbound logistics for efficient national coverage The investment is expected to amount to approx. SEK 400 million over a two-year period The start-up of the new factory is planned for the beginning of 2016 Fully utilized, the capacity will be approx. 100,000 MT, with room for further expansion at a later stage The plant will be able to serve our Bakery, Dairy, Infant Nutrition and CCF segments 19
Fabrica Nacional de Grasas S.A. (FANAGRA) Located in Colombia • Headquartered in Bogotá • Factory in Villavicencio Specializes in vegetable oils and fats for the bakery segment Revenues of approximately SEK 270 million in 2013 Annual volume of 30,000 MT Employs 155 people Limited impact on 2014 operating profit Will fully contribute starting January 2015 20
AAK has acquired bakery fats specialist in Belgium CSM, a leading bakery fats supplier to the bakery markets in Belgium, the Netherlands, France and Germany The acquired business had revenues of approx. SEK 970 million and volumes of approx. 100,000 MT in 2013 The transaction includes: • Production facility in Merksem, Belgium • Variety of bakery fat solutions, margarines and pumpable shortenings • Experienced sales force • Team of application specialists • Bakery innovation center 21
Product development – FI Akopastry – Low fat • Going from typical 82% fat to 60% fat • No loss in functionality, appearance or taste Akomix LS 25 • Developed for ice cream products • Reduces the SAFA with more than 70% • Nominated for FIE award, Dairy Innovation of the year 22
Product development – CCF Illexao™ MT 20 • Improved milk fat tolerance resulting in improved processing Chocofill™ NH 110 • For steep melting non-hydrogenated fillings without tempering • Nominated for Confectionery Innovation of the year at FIE 23
Product development – PC Lipex SheaLight TM • New sustainable light emollient ester derived from natural resources • An ideal emollient for skin, hair care and sun care • Very first shea product that maintains the skin nourishing properties of shea, while leaving the skin with a dry and powdery feel • Shea emollients known for their skin nourishing, moisturising and anti-inflammatory properties • Good solubiliser of UV filters in sunscreens 24
Management growth ambition* Acquisitions Organic growth Productivity Operating profit 2010 4 0 0 4 0 0 8 0 0 8 0 0 2010 In appr 5-6 years 25 * As expressed at the Capital Market Day November 10, 2010 and at fixed exchange rates.
2 0 1 5 – Organic grow th 26
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