S W A L L O W F I E L D P L C 3 1 S T A G M 9 T H N O V E M B E R - - PowerPoint PPT Presentation

S W A L L O W F I E L D P L C 3 1 S T A G M

9 T H N O V E M B E R 2 0 1 7

Brendan Hynes Chairman “Welcoming Address and Opening Remarks”

• Fire exits are situated behind you and to your left. If the

alarm sounds please leave by the nearest exit - the assembly point is at the front car park.

• Please ensure mobile phones are switched off.
• Questions will be taken after the presentations.
• Buffet lunch will be served the end of the meeting.
• There will an opportunity for a factory tour after lunch.

More details at the end of the meeting.

• “Goodie” bags will be handed out at Reception, by the

car park, as you leave.

Order for the Day

• Voting on the proposed resolutions
• Shareholder presentation
• Questions from the floor

Resolution 1

To receive and adopt the annual statement

• f

accounts and the reports of the directors and auditors for the year ended June 2017

Resolution 2

To declare a final dividend of 3.5p per share

Resolution 3

To re-elect Mr Edward Beale as a director

Resolution 4

To authorise the directors to determine the auditors’ remuneration

Resolution 5

To re-appoint Grant Thornton UK LLP as auditors to hold office until the conclusion of the next Annual General Meeting of the Company

Resolution 6

To authorise the directors to allot equity securities

Resolution 7

As a Special Resolution, to authorise the Company to allot equity securities in respect of the disapplication of pre- emption rights

Resolution 8

As a Special Resolution, to authorise the Company to allot equity securities in respect of the disapplication of pre-emption rights – specified investment

Resolution 9

As a Special Resolution, to authorise the Company to purchase its own shares

A G M P R E S E N T A T I O N

9 N O V E M B E R 2 0 1 7

CHIEF EXEC | CHRIS HOW GROUP FD | MARK WARREN GROUP SALES & MARKETING DIRECTOR | JANE FLETCHER

D I S C L A I M E R

The information contained in this confidential document (“Presentation”) has been prepared by Swallowfield plc (the “Company”). It has not been fully verified and is subject to material updating, revision and further amendment. This Presentation has not been approved by an authorised person in accordance with Section 21 of the Financial Services and Markets Act 2000 (“FSMA”) and therefore it is being delivered for information purposes only to a very limited number of persons and companies who are persons who have professional experience in matters relating to investments and who fall within the category of person set out in Article 19 of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the “Order”) or are high net worth companies within the meaning set out in Article 49 of the Order or are otherwise permitted to receive it. Any other person who receives this Presentation should not rely or act upon it. By accepting this Presentation and not immediately returning it, the recipient represents and warrants that they are a person who falls within the above description of persons entitled to receive the Presentation. This Presentation is not to be disclosed to any other person or used for any other purpose. Please note that the information in this Presentation has yet to be announced or otherwise made public and as such constitutes relevant information for the purposes of section 118 of FSMA and non-public price sensitive information for the purposes of the Criminal Justice Act 1993. You should not therefore deal in any way in the securities of the Company until after the formal release of an announcement by the Company as to do so may result in civil and/or criminal liability. N+1 Singer Advisory LLP (“N+1 Singer”) is acting in the provision of corporate finance business to the Company, within the meaning of the Financial Conduct Authority’s Conduct of Business Sourcebook (“COBS”), and no-one else in connection with the proposals contained in this

• Presentation. Accordingly, recipients should note that N+1 Singer is neither advising nor treating

as a client any other person and will not be responsible to anyone other than the Company for providing the protections afforded to clients of N+1 Singer under the COBS nor for providing advice in relation to the proposals contained in this Presentation. While the information contained herein has been prepared in good faith, neither the Company nor any of its shareholders, directors, officers, agents, employees or advisers give, have given or have authority to give, any representations or warranties (express or implied) as to, or in relation to, the accuracy, reliability or completeness of the information in this Presentation, or any revision thereof, or of any other written or oral information made or to be made available to any interested party or its advisers (all such information being referred to as “Information”) and liability therefore is expressly disclaimed. Accordingly, neither the Company nor any of its shareholders, directors, officers, agents, employees or advisers take any responsibility for, or will accept any liability whether direct or indirect, express or implied, contractual, tortious, statutory or otherwise, in respect of, the accuracy or completeness of the Information or for any of the opinions contained herein or for any errors, omissions or misstatements or for any loss, howsoever arising, from the use of this Presentation. This Presentation may contain forward-looking statements that involve substantial risks and uncertainties, and actual results and developments may differ materially from those expressed or implied by these statements. These forward-looking statements are statements regarding the Company's intentions, beliefs

• r current

expectations concerning, among other things, the Company's results of operations, financial condition, prospects, growth, strategies and the industry in which the Company operates. By their nature, forward-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not

• ccur in the future. These forward-looking statements speak only as of the date of this Presentation

and the Company does not undertake any obligation to publicly release any revisions to these forward-looking statements to reflect events or circumstances after the date of this Presentation. Neither the issue of this Presentation nor any part of its contents is to be taken as any form of commitment on the part of the Company to proceed with any transaction and the right is reserved to terminate any discussions or negotiations with any prospective investors. In no circumstances will the Company be responsible for any costs, losses or expenses incurred in connection with any appraisal or investigation of the Company. In furnishing this Presentation, the Company does not undertake or agree to any obligation to provide the recipient with access to any additional information or to update this Presentation or to correct any inaccuracies in, or omissions from, this Presentation which may become apparent. This Presentation should not be considered as the giving of investment advice by the Company or any of its shareholders, directors, officers, agents, employees or advisers. In particular, this Presentation does not constitute an offer or invitation to subscribe for or purchase any securities and neither this Presentation nor anything contained herein shall form the basis of any contract or commitment whatsoever. Any decision to subscribe for the Company’s securities must be made only

• n the basis of the information contained in the admission document in its final form relating to the

Company, which may be different to the information contained in this Presentation. Each party to whom this Presentation is made available must make its own independent assessment of the Company after making such investigations and taking such advice as may be deemed necessary. In particular, any estimates or projections or opinions contained herein necessarily involve significant elements of subjective judgment, analysis and assumptions and each recipient should satisfy itself in relation to such matters. Neither this Presentation nor any copy of it may be (a) taken or transmitted into Australia, Canada, Japan, the Republic of Ireland, the Republic of South Africa or the United States of America (each a “Restricted Territory”), their territories or possessions; (b) distributed to any U.S. person (as defined in Regulation S under the United States Securities Act of 1933 (as amended)) or (c) distributed to any individual outside a Restricted Territory who is a resident thereof in any such case for the purpose of

• ffer for sale or solicitation or invitation to buy or subscribe any securities or in the context where its

distribution may be construed as such offer, solicitation or invitation, in any such case except in compliance with any applicable exemption. The distribution of this document in or to persons subject to other jurisdictions may be restricted by law and persons into whose possession this document comes should inform themselves about, and observe, any such restrictions. Any failure to comply with these restrictions may constitute a violation of the laws of the relevant jurisdiction.

A G E N D A

• R E C A P
• F Y 1 7 H I G H L I G H T S A N D S T R A T E G Y O U T L I N E
• F I N A N C I A L S
• P R O G R E S S V S S T R A T E G I C P I L L A R S

Jan 2014 Aug 2017

C O N S I S T E N T S T R A T E G Y , C O N T I N U E D M O M E N T U M

Market Capitalisation

Fund Raise £8.6m

£56m < £10m

Since 2014:

• Re-focused manufacturing business on higher

margin, added value product formats

• Leverage capability to build owned brand

portfolio

• Successful acquisitions – earnings enhancing,

strategy acceleration, smooth integration

• Fund raise leading to reconfigured shareholder

base and improved liquidity

• Consistent results delivery: sales, profit, cash, EPS,

shareholder value

FY13 FY14 FY15 FY16 FY17 Underlying Operating Profit

(£m)

5.6

2.0 1.0 0.8

25% 42% 44% 60% 324%

FTSE 100 * FTSE Small Cap * AIM All Share **Personal Goods Index ** Swallowfield **

3 Year Total Shareholder Return

S T R O N G S H A R E H O L D E R R E T U R N S

£56m

5.6

* 3 years to end 2016 ** 3 years to Oct 2017

SWALLOWFIELD CAPABILITY PLATFORM

Consumer Trends, Innovation/Product Development, Manufacturing, Quality Processes, Sourcing/Purchasing, Project Management, Logistics, Retailer Relationships, International Footprint, etc.

OWNED BRANDS VALUE STREAM MANUFACTURING VALUE STREAM

O U R B U S I N E S S M O D E L

F Y 1 7 H I G H L I G H T S Financial

• Strong revenue growth of +36%, +8% exc. acquisition
• Underlying operating profit +180% to £5.6m
• Adjusted EPS increases by 40% to 17.7p
• Final dividend increased by 52% to 3.5p (Full Year 5.2p, an

increase of 68%)

• Further improvement in Net Debt position to £3.6m (< 0.6x

underlying ebitda)

F Y 1 7 H I G H L I G H T S Operational

• The Brand Architekts successfully integrated and continuing

strong momentum

• Brands now account for 24% of sales
• Prior year gains in % contribution margin further improved despite

impact of currency and input price pressure

• Strong new product programmes delivered in both

manufacturing and owned brand businesses

• Investment in brand support and organisational capability
• E-commerce now live across 7 brands

F I N A N C I A L S U M M A R Y

* Adjusted earnings per share are calculated before exceptional items and amortisation of acquisition-related intangibles ** Underlying operating profit is calculated by adding back the charge for share-based payments to adjusted operating profit. This measure was adopted as the charge for share-based payments is a material £1.76m (2016: £0.22m), and is intended to provide a more representative reflection of the trading performance of the Group # FY2014 revenue adjusted to 52 weeks

S E G M E N T A T I O N

S A L E S F Y 1 7 P R O F I T F R O M O P E R A T I O N S * F Y 1 7

PERSONAL CARE AEROSOLS 52% COLOUR COSMETICS & PENCILS 14% FRAGRANCE & GIFTING 17% PREMIUM LIQUIDS/ TUBES 5% HOT POUR 6%

MANUFACTURING 76% BRANDS 24% BRANDS 38% MANUFACTURING 62%

* Excluding Eliminations and Central Costs

M A N U F A C T U R I N G S A L E S B R E A K D O W N F Y 1 7

B Y P R O D U C T T Y P E B Y C U S T O M E R T Y P E *

PERSONAL CARE AEROSOLS 52% COLOUR COSMETICS & PENCILS 14% FRAGRANCE & GIFTING 17% PREMIUM LIQUIDS/ TUBES 5% HOT POUR 6%

PERSONAL CARE AEROSOLS 54% (56%) HOT POUR 6% (6%) PREMIUM LIQUIDS/TUBES/ROLL

• ONS

7% (7%) FRAGRANCE & GIFTING 15% (17%) COLOUR COSMETICS & PENCILS 18% (14%) PRESTIGE BRANDS 29% (27%) MASS BRANDS 32% (29%)

BEAUTY / FASHION RETAILERS 32% (36%)

GROCERY RETAIL 7% (8%)

FY16 prior year comparative shown in ( )

B R A N D E D S A L E S

S A L E S F Y 1 7

PERSONAL CARE AEROSOLS 52% COLOUR COSMETICS & PENCILS 14% FRAGRANCE & GIFTING 17% PREMIUM LIQUIDS/ TUBES 5% HOT POUR 6%

INTERNATIONAL 24% UK NON-FOOD RETAIL 19% MANUFACTURING 59% UK GROCERY RETAIL 57%

P R O G R E S S V S S T R A T E G I C P I L L A R S

OWNED BRANDS

• NEW PRODUCT DEVELOPMENT – AT PACE,

CONSUMER AND CUSTOMER RELEVANT

• LEVERAGE SWALLOWFIELD RESOURCES
• INTERNATIONAL

MANUFACTURING

• INNOVATION, QUALITY, SERVICE, TO

GLOBAL BRAND OWNERS

• DRIVE CATEGORY FOCUS
• COST BASE OPTIMISATION

P R O G R E S S V S S T R A T E G Y

OWNED BRANDS

• NEW PRODUCT DEVELOPMENT – AT PACE, CONSUMER AND

CUSTOMER RELEVANT

• LEVERAGE SWALLOWFIELD RESOURCES
• INTERNATIONAL

3 S T R A T E G I C P I L L A R S

• INNOVATION, QUALITY, SERVICE, TO GLOBAL

BRAND OWNERS

• DRIVE CATEGORY FOCUS
• COST BASE OPTIMISATION

M A N U F A C T U R I N G S T R A T E G Y

M A N U F A C T U R I N G : I N N O V A T I O N

• Innovation remains the key differentiator in our customer proposition
• Plastic aerosol volumes continue to grow – new projects in development
• Approx. 200 Swallowfield developed new products sold in the year
• Particular success in aerosols and hot pour product formats
• Close to 70% of manufacturing business now with global brands owners

M A N U F A C T U R I N G : D R I V E C A T E G O R Y F O C U S

• ‘Drive’ product categories are in growth, particularly:
• Aerosols
• Hot pours
• Cosmetic pencils
• Increased wood pencil capacity and cost efficiency to meet growing

demand

• New customers and contract extensions
• Particular success in haircare and eye brow products in aerosols and hot

pour

M A N U F A C T U R I N G : C O S T B A S E O P T I M I S A T I O N

• Energy saving improvements continue at Wellington site
• Line efficiency programmes continue to contribute to margin improvement
• Pencil automation in Bideford decreases cost per unit and increases capacity
• Tabor site creates alternative option for a major customer as they seek

alternatives to dollar denominated China supply

• Further FY18 Projects to support The Brand Architekts products and drive

automation incl. first investments in robots

OWNED BRANDS

• NEW PRODUCT DEVELOPMENT – AT PACE, CONSUMER AND

CUSTOMER RELEVANT

• LEVERAGE SWALLOWFIELD RESOURCES
• INTERNATIONAL

3 S T R A T E G I C P I L L A R S

• NEW PRODUCT DEVELOPMENT – AT PACE;

CONSUMER AND CUSTOMER RELEVANT

• LEVERAGE SWALLOWFIELD RESOURCES
• INTERNATIONAL

O W N E D B R A N D S T R A T E G Y

O W N E D B R A N D S : N E W P R O D U C T D E V E L O P M E N T

• Brand Architekts: 78 new sku’s launched in FY17 across 11 brands
• Wide range of new concepts and formats
• Significant growth of value ranges in value retail channels
• The Real Shaving Company new gift range successfully launched
• Brand Architekts YOY growth >20%.
• Original Swallowfield brands have doubled sales.

O W N E D B R A N D S : L E V E R A G I N G S W A L L O W F I E L D R E S O U R C E S

• First Swallowfield produced products for Brand Architekts brands and

many more live projects for FY18 production

• Supply Chain team driving margin improvement and cost savings
• China freight volumes consolidated and re-negotiated
• PR / Marketing/ Digital agencies now fully consolidated
• Technical & Regulatory team supporting Brand Architekts

O W N E D B R A N D S :

B U I L D I N G B R A N D E N G A G E M E N T A C R O S S e - C H A N N E L S

• Digital engagement continues to a very important part of the branded world
• We already engage with over 100K people on social networks
• ‘Mr. Jamie Stevens’ product video has now reached over 1 million views

O W N E D B R A N D S : E - c o m m e r c e R e v e n u e C o n t i n u e s t o B u i l d

F U R T H E R D E V E L O P I N G T H E e - C O M M E R C E O P P O R T U N I T Y

• Swallowfield have acquired a 70% share in Sterling Shave Club
• Ltd. in September
• Modest scale business but in fast growing and high profile sector
• Very British antidote to very American marketing of other brands

in the sector

• Consideration directed at supporting business growth plan
• Opportunity to develop subscription model to broader range of

product categories

O W N E D B R A N D S : I N T E R N A T I O N A L D E V E L O P M E N T

• Very strong YOY growth on Brand Architekts portfolio (particularly USA, Turkey)
• Takes international sales on all owned brands to 24% of total sales
• New geographies opened (Netherlands, South Africa, France)
• Dirty Works & Bagsy launched in Monoprix, France and Di, Belgium
• First time participation in major trade fairs (ECRM Monaco, Cosmoprof Bologna)

T H E V E R Y L A T E S T . . .

P R O U D W I N N E R S

BAMA Aerosol of The Year 2017 BAMA Safety Process Award 2017 Sainsbury’s Beauty Awards Colleague Award 2017

Beauty Bible Awards 2017 SuperFacialist Vitamin C+ Skin Defence Daily Moisturiser

Beauty Bible Awards 2017 Bagsy

S U M M A R Y

A S P E R T H E C H A I R M A N ’ S S T A T E M E N T

• trading in the first four months of the year is in line with expectations.
• we continue to see strong momentum in our branded business
• ur manufacturing business is performing steadily against strong prior

year comparators

• there is a fresh wave of new product launches and contract wins that

will contribute to our full year performance

• we remain conscious of the continuing macro uncertainty both in

the UK and internationally

• verall we expect to maintain our positive progress and are well

positioned to deliver against our expectations for the full year

QUESTIONS?

– All mobile phones, watches, cigarette lighters, jewellery must be removed before entry into the factory. – Secure envelopes will be available for storage of valuables. – Personal protective equipment must be worn at the times indicated by your guide. – No open-toed shoes permitted in factory

F A C T O R Y T O U R I N F O R M A T I O N

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