GROUP PRESENTATION FOR INVESTORS September – October 2009
Investor Relations Department: +33 (0)1 45 19 52 26 www.bicworld.com
Content Capital ownership
5
Stationery
Our strengths
6
Consumer
Strategy
7
Consumer stationery market
19
2008 Key Figures
20
Stationery consumer - Strategy
21
10
Positions in major market segments
22
International footprint
11
Quality @ BIC price
23
Group Key Figures
12
BIC Graphic
24
2008 Net sales by categories
8
Positions in our 3 core businesses
9
Recognized brands
CAPEX Strong balance sheet Return to shareholders
N°1 branded lighter manufacturer
29
Towards more value-added products
30
2009: continue to offer more value-added products
31
Shavers
Our marketplace
33-35
2008 Key Figures
36
Shavers - Strategy
37
A comprehensive range of quality products
38 39
13 14 15
Use of cash policy
16
2009: Objectives
17
Lighters Child-resistant regulation in Europe
26
Quality and innovation at a reasonable price
2008 Key Figures
27
3-blades one-piece market shares
40
Lighters - Strategy
28
Shavers in 2009
41-42 2
Content Recent acquisitions Focus on recent acquisitions
Sustainable development 44
Cello Pens Stationery consumer – Where will the growth come from? India’s writing instrument market India’s pen market Cello Pens key figures
45 46 47 48
Enhanced growth profile for both companies
49
Benefits for both companies
50
A value creating partnership
51
Antalis and Norwood Promotional Products
Capex
77
Key component of our strategy
62
Balance sheet
78
The key points of our approach
63
Net Cash Position
79
Update on cost reduction plan
80
FY09 expected operational trends
81
2009: outlook
82
H1 2009 results Key Figures
65
Stationery Consumer Market trends
66
Stationery
67
Lighters
68
Main exchange rate evolution vs. euro
84
Shavers – Market evolution
69
From reported IFO to Normalized IFO
85
Shavers
70
Consolidated P&L
86
Other Products
71
Quarterly figures
87-91
Net sales evolution by geographies
72
Appendix
H1 2009 Net sales breakdown by category H1 2009 Net sales breakdown By geographies
92
Rationale
52
Net sales - Consumer vs. Promotional products
73
Why Promotional Products
53
From Net sales to IFO
74
The US example
54-57
IFO Margin
75
Glossary
94
BIC Promotional Products
58-59
From IFO to Group Net Income
76
Disclaimer
95
93
3
Group Overview
Investor Relations Department: +33 (0)1 45 19 52 26 www.bicworld.com
Capital ownership As of December 31, 2008*
Bich Family 44% (54% of voting rights)
Public 29%
Arnhold and S. Bleichroeder Advisers, LLC 7% Silchester International 15%
*Figures calculated from the latest available information.
Treasury stock 1%
Mrs Edouard Buffard 5%
Number of shares outstanding August 2009: 48,487,888
5
Our strengths
Products
Brand…S
Worldwide leadership
Balance Sheet
N°2 Simple Reliable Inventive At the right Price
*one-piece shavers in major markets (US, Europe, Latin America)
Stationery 10% market share
N°1 Lighters 35% market share
N°2
Shavers 20% market share* of one-piece in USA and Europe
143 M€ Free Cash Flow after Acquisitions in 2008
210.6 M€ Net Cash Position at the end of 2008 6
Strategy
Î Support core products Î Meet consumers’ needs and desires through innovative products Î Improve our quality & manufacturing efficiency Î Leverage the
brand
Î Expand our geographical presence Î Capitalize on external opportunities and alliances Î Integrate sustainable development as a key component
7
2008 Net Sales breakdown by category
Other Products
Shavers
7% 7%
Stationery
19% 19% 47% 47%
27% 27%
Lighters
8
Positions in our 3 core businesses
Stationery 10% market share*
N°2
Worldwide for consumer stationery products
Lighters 35% market share*
N°1
Worldwide for branded pocket lighters
N°2
of one-piece shavers in major markets (US, Europe, Latin America)
Shavers 20% market share* of one-piece in USA and Europe
*: all market shares are in value
9
Recognized brands to leverage
A brand that simplifies people’s lives A well-known brand consumers feel close to A brand that offers good value for money A quality brand
A high level of awareness* (100% in France & Greece, 97% in the UK, 98% in the USA & in Australia, 91% in Brazil, 98% in Mexico, etc.) *: TNS Sofres - 2001
10
Our international footprint 2008 net sales breakdown by geography
MEAA Europe 6% 6%
Latin America
20% 20%
33% 33%
41% 41%
North America 11
EPS
Normalized Income From Operations
NET SALES
Group Key Figures
€1420.9 m
€214.3m
€3.00
2003 – 2008 growth average at constant currencies: +4.8%
2003 – 2008 Average Normalized IFO* margin: 16.6%
2003 – 2008 EPS* CAGR:
+8.1%
7.2%
5.0%
Free Cash Flow ***
€143m
4.7%
2.5%
2003
2.4%
2004
15.5%
16.2%
2003**
2004
2005
2006
2007
17.5%
17.9%
17.4%
2.03
159.6
2008
15.1%
2005
3.11
2003
2008 FCF / net sales:
7.0%
2006
2007
3.43
3.51
2008
3.00
2.15
2004
2005
157.2
2006
147.3 98.9
2007
116.0
2008
143.0
10%
2003
*: actual figures **: IFRS restated figure / French GAAP = 15.4% *** Cash from operating activities – cash from investing activities / after acquisitions
2004
2005
2006
2007
2008
12
CAPEX In million euros
90* 70
70
2003
2004
*Shelton real estate acquisition (€ 11m)
83 71
2005
2006
77
2007
2008
2009 Est.
13
Strong balance sheet EQUITY & LIABILITIES
ASSETS
359,7
Tangible assets
355,7
233,0
Intangible assets
232,0 1174,5
170,9
Net cash position
117,6
Other assets
475,8
Working capital*
210,6
Shareholders’ equity
163,5
426,6 182,6
2007
1172,1
2008
2007
Other liabilities
216,4
2008
Rounded figures in million euros 14
* Working capital = Net Inventory + Trade and other receivables – Trade and other payables – Other assets and liabilities
Return to shareholders In million euros
161
179 160 144
3 129
27* 31
63
1
13
99 49
43
1 58
64 65.5
86
72
71
49
2003
2004
2005
Free cash flow*
2006
Share buyback
40
2007
Dividend
25.7 2008
Acquisition
*: Cash from operating activities – cash from investing activities (before acquisition) **: 2004 exceptional dividend
15
Consistent use of cash policy 2006 PIMACO
Focus on Strategic acquisitions
-Adhesive labels -Brazil
2009
2007
2009
Atchison Products - Promotional products - USA
APP
Cello Pens
- Promotional products - Europe
- Writing Instruments - India
2009 Norwood Promotional Products - USA
Continue to look for strategic acquisitions, although following Cello Pens, focus will be to succeed in leveraging recent moves In euros 0,80
Dividend
1,15 0,90
1,35
1,30
1,35
1,00
45% payout
Regular dividend per share
in 2009 based on 2003
2004
Dividend per share
In million euros
71
86
72
2005
2006
2007
49
Share Buy-back 2003
2004
2005
2008 results
2008
Special Dividend
2006
40
2007
26
2008 16
2009: objectives
In a market slowdown, our target is to: Î gain shares in all categories
Î protect cash generation
17
Stationery
Investor Relations Department: +33 (0)1 45 19 52 26 www.bicworld.com
The consumer stationery market Total worldwide consumer stationery market = 6 billion euros in 2007 Key Geographical Markets (breakdown in value)
ROW
Breakdown by main segment (in value)
Europe Correction
India
10% 10% 6% 6%
China
27% 27%
7% 7%
Coloring 16% 16%
8% 8%
49% 49% 15% 15%
Japan
8% 8%
Markers
26% 26%
Pens
15% 15% 13% 13%
Pencils
Latin America North America & Oceania
BIC Estimate & Published Research – 2007 – Manufacturers figures –Pens, pencils, markers, coloring, correction
19
2008 Stationery Key Figures
2008
YoY Change
YoY Change at constant currencies*
Net Sales
673.3
-5.8%
-0.4%
Income from Operations
90.5
-16.2%
BIC Group In million euros
Normalized* IFO Margin
* see glossary
14.1%
20
Stationery Consumer – Strategy Leverage strength of BIC® brand to grow share in all segments to levels achieved in our Classic Ball Pen core segment Our challenges
1.
Grow in a market flat in mature countries
2.
Answer to the increased competition from low-cost Asian manufacturers with inconsistent quality products
3.
Build awareness of our innovations
4.
Grow in value-added writing instruments
5.
Adapt to the evolution different distribution networks (office product industry and retail channel)
Our strengths
1.
A brand that consumers trust
2.
Clear positioning Quality @ a BIC price Great value for money
3.
Strong positions in key segments
4.
Superior technical know-how to drive quality control and innovation
5.
Global presence following the acquisition of Cello®
6.
Sourcing capacities
21
Stationery Consumer – Positions in major market segments
N°1 in Europe (16% market share)
N°1 in Ball Pen (17% market share)
N°1 in Mechanical Pencils* (14% market share)
N° 2 worldwide with 10% market share N°2 in North America (13% market share)
N°2 in Marking (8% market share)
N°1 in Correction (17% market share)
BIC Estimate & Published Research – 2006 *: together with Newell
N°1 in Latin America (24% market share)
22
Stationery Consumer in 2009: “Quality @ a BIC price” More than 3m outlets worldwide
Historical and close relationship with the trade
Iconic products
Strong brands
Worldwide leadership positions
Strong positions in major market segments
Innovation
Consumer trust for more than 50 years 24 million BIC stationery products bought every day worldwide
23
Stationery Promotional Imprinted Products – BIC Graphic
B to B Our challenges
Our strengths
1. Competition from non-branded, low-cost, low-quality writing instruments 2. Global economic slowdown resulting in a reduction of customer promotional marketing budgets
1. A leadership position in quality and safety 2. Established distributor partnership programs, backed by service excellence 3. BIC® brand to leverage in key segments: Sticky Notes®, Mouse Pads, Magnets, Drinkware
24
Lighters
Investor Relations Department: +33 (0)1 45 19 52 26 www.bicworld.com
Child-resistant Regulation in Europe May 11, 2006: European Decision (2006/502/EC) April 12, 2007: European Decision (2007/231/EC)
March 11, 2007
December 31, 2007
March 11, 2008
94% of BIC® lighters sold to the trade are child-resistant Non child-resistant & novelty lighters imported or manufactured before March 11, 2007 can be sold to consumers
• All lighters imported or manufactured in Europe must be ISO 9994 compliant • All lighters imported or manufactured in Europe must be child-resistant • Novelty lighters import or manufacture in Europe banned
•All lighters sold to consumers must be ISO 9994 compliant •All lighters sold to consumers must be child-resistant •Novelty lighters sales to consumers banned 26
2008 Lighters Key Figures
2008
YoY Change
YoY Change at constant currencies*
Net Sales
376.9
-3.4%
+0.8%
Income from Operations
110.0
-12.2%
IFO Margin
29.2%
BIC Group In million euros
* see glossary
27
Lighters – Strategy
Strengthen our position as the only branded lighter with worldwide strengths Accelerate development of value-added lighters
Our challenges
Our strengths
1. Acceleration of the trend of tobacco consumption
1. Our brand
2. Promote the extension and enforcement of mandatory ISO 9994 International safety standards
2. Quality
3. Increase awareness of safety rules among distributors and consumers
4. Our distribution
3. Our safety programs
5. Our technical know-how 28
Lighters: N°1 branded lighter manufacturer Consumer preference
Safety – Quality – Prevention & education
Brand awareness US Disposable Pocket Lighter 86%
BIC
Competitor A
vs. market average
10%
More than 50 automatic quality controls Competitor B
8%
Market leadership Estimated market shares (in value)
> 60%
Integrated distribution network > 60%
• Dedicated Customer Support Teams in
35%
all countries
15 INR
63%
62% 63.6 INR = 1 euro (January 20, 2009)
47
Cello Pens
PENS
The leading Indian writing instrument brand
37% share of the
Appr. 5,000 employees
Indian Pen market
90% unaided
1 bn pens per year
awareness
(2 industrial sites )
The widest distribution network in India
Strong growth - High Profitability Approximately 30% FY07-08 EBIT margin
Cello Pens are distributed nationwide through Î 731,000 outlets all across India Î a network of 42 superstockists and 4,200 distributors
Revenue (INR Million) 4,100
2,300
12% 02-03
5
GR CA s e sal s r yea
07-08
48
BIC + Cello Pens: an enhanced growth profile for both companies
N°2 in North America (13% market share)
N°1 in Europe (15% market share) PENS
N°1 in India (37% market share)
N°1 in Africa
N°1 in Latin America (24% market share)
Writing instrument market shares
N°2 in Oceania (16% market share)
49
Strong benefits for both companies Develop emerging segments in India (Correction, Marking and Mechanical Pencils)
Extend BIC stationery business to one of the most dynamic writing instrument markets in the world
Partner with the N°1 brand in India
Supplement BIC® product range with select Cello® Pens products in other countries
PENS
Sharing best practices in new product development and manufacturing know-how
Strengthen Cello® Pens’ position in India by adding BIC products and BIC Brand to its domestic portfolio 50
A value creating partnership
H1 2009
Acquisition of 40% of Cello Pens writing Instrument business
April 2013
Call option to increase its stake to 55% at a price based on a formula tied to earnings
Deal structure
Transaction price
Financing & impact on BIC accounts
INR 7.9 billion total consideration paid for 40% of Cello Pens
Financed mostly through USD denominated bank loans
40% of Cello Pens net income will be accounted through the equity method and acquisition is expected to be EPS accretive from 2009
51
APP and Norwood Promotional Products
Vertical integration • N°1 branded supplier in imprinted writing instruments and lighters with strong positions in its markets (Europe, US, Latin America) • Excellence in order entry and imprinting
Horizontal integration
Horizontal and vertical integration
• European supplier with a wide range of distributors • A complete range of non-imprinted products • Specialized in sourcing
• Perceived as specialized player
A complete range of products and services
• 2nd US largest supplier of non-apparel promotional products • A complete range of imprinted and non-imprinted products • Sourcing capabilities
Imprinted and nonimprinted approach
N°1 global branded full service supplier Global sourcing capacities
Worldwide positions 52
Why the promotional products industry?
Promotional Products • Market size (end-users – est.)
A large market
- USA: 18 bn USD - Europe: 10 bn euros
cc. 5% of global advertising spending
Highly diverse & fragmented category
Approximately 3,000 suppliers in the USA and 2,000 in Europe Approximately 22,000 distributors in the USA and 20,000 in Europe Approximately 20 product categories, most of them with less than 10% of the total market
Growing share of wearable, bags, electronics suppliers, sport & leisure and special designs
53
Why the promotional products industry? The US example Î a cyclical business with significant growth for the last 20 years Total end-users advertising expenses in Promotional Products
Total end-users advertising expenses in Promotional Products
(in Bn USD)
(YoY % of chge)
+8% CAGR
19,4
18,1
25%
24%
20%
19% 18% 15% 13%
12%
4,2
11%
8% 4%
1988
13%
1991
1994
1997
2000
2003
2006
4%
6% 5%
5% 2% 2%
4%4% 4%
2008 -6%
-7%
-7% 85
89
93
97
01
05
08 54
Why the promotional products industry? The US example Î A major player in Media advertising Selected Media Advertising Sales (2007 – in Bn USD)
19,4
Selected Media Advertising Growth
18,9 17,8 14%
14,6
1999-2004 CAGR 2004-2007 CAGR
12%
8%
7,4
7%
7,3
5%
5% 4%
3,4
Promotional Products
Point of purchase
Cable TV
Yellow Pages
Couponing Out-of-home
Business magazines
2,9
Products Placement
3%
3% 2%
Internet
Promotional Magazines Products
3%
3% 2%
Outdoor
TV
Newspapers
2%
Radio
55
Why the promotional products industry? The US example Î A highly fragmented products category Food 2% Badges 2%
Electronics 2% Others 5%
Stickers 2% Games 2% Textiles 2% Wearables 31%
Housew ares2% Magnets 2% Automotive 3% Sporting Goods 3% Computers 3% Aw ards 4% Calendars 6% Business acessories 6%
Drinkw are 6%
Bags 7%
Writing instruments 10% 56
Why the promotional products industry? The US example Î A fragmented industry (including wearables) B o rder B ro s & Co P o lyco ncept No rth A merica No rwo o d P ro mo tio nal P ro ducts Ennis SanM ar B IC Graphic USA
2007 net sales
B o dek & Ro dhes
US TOP 10 suppliers
A sh City 3M P ro mo tio nal M arkets
Apparel only
Stato n Co rpo rate & Casual
0
50
100
150
200
250
300
350
400
450
Industry sources (SOI 2008) 57
BIC Promotional Products Business Mainly Internal growth 1969
1970 Î 2006
BIC enters the Promotional Products Business
Products & geographical diversification (Europe, USA, Latin America)
Mainly External growth 2007
Atchison (USA)
2009 Antalis Promotional Products (Europe)
Norwood Promotional Products (USA) Full range of imprinted & non imprinted products
Complete range of non imprinted products Imprinted bags Imprinted lighters, sticky notes, drinkware, … Imprinted Writing Instruments
58
BIC Graphic has leading experience in the business
59
Approximately 25% of BIC Group net sales in 2009 Group Net Sales breakdown by category Full Year 2008
Full Year 2009 estimated
Total Other Products 7%
25% Total Shavers 19%
Total Lighters 27%
Total Stationery 47%
Advertising & Promotional Products (BIC Graphic, Atchison, APP, Norwood)
Consumer business (stationery, lighters, shavers, other products)
75% Of which Promotional Products
ÎIn 2010, Advertising and Promotional Products will be reported on a stand alone basis.
60
Sustainable Development
Investor Relations Department: +33 (0)1 45 19 52 26 www.bicworld.com
Sustainable development Integrated as a key component of Group strategy A barometer with indicators and 3 year objectives Major work undertaken in the development of new materials and green products
Sustainable development features in the top five Group objectives: “Transform our commitment to Sustainable Development into eco-solutions that will deliver a true competitive advantage for the Group” Mario Guevara
62
Sustainable development The key points of the BIC approach Long-lasting products
Nothing superfluous
BIC® Cristal® 2.8 g material per km of writing
A range made from new materials
A measured environmental impact Distribution Production
Raw material
End of life
BIC® EcolutionsTM range 63
Q2 – H1 2009 RESULTS
Investor Relations Department: +33 (0)1 45 19 52 26 www.bicworld.com
Group H1 2009 key figures Net Sales: 713.1 million euros % of change
Normalized* Income from Operations: 109.1 million euros Margin
15.3%
14.9%
1,8% +0.1%
-2,3% As reported
At constant currencies*
On a comparative basis*
H108
Net Cash Position
EPS: 1.4 % increase In euros
1.45
1.47
H109
In million euros
210.6 149.2 61.5
H108
* see glossary
H109
June 08
Dec. 08
June 09
65
Stationery Consumer – Market trends Europe
USA
-1.6% -2.1%
-1.6%
-3.9% -5.1% -5.5% -5.6% -5.9%
-2.6% -2.9%
-10.2%
-6.2%
-11.4%
-5.9%
-17.7%
-9.3% FY 2008
FY 2008
YTD May-09
YTD May-09
Total Market Office Suppliers
Modern Mass Market
Source: NPD/IRI – excluding Wall Mart for the US & GfK for Europe
Super Stores
Traditional 66
Stationery Change in net sales at constant currencies*
Normalized* IFO margin
17,7% 15,5%
11,6%
11,1% -8.7% -10.8% In million euros
H109 IFO
H109 NET SALES
Net Sales
5,7%
-9.6%
Q1 2009
Q2 2009
H1 2009
130.3
189.6
319.9
14,9%
Q108
Q109
Q208 Q209
H108 H109
H1 2009 Consumer business : -5.4% at constant currencies, slight improvement in Q2 vs. Q1 09. - Europe and North America • Continued decline of the Office Products channel for all competitors • Back-to-school shipments delayed by many retailers to control inventory • BIC market share and position has been maintained - Latin America • Continued strong performance in South America, partially offset by declines in Mexico H1 2009 BIC Graphic – Promotional Imprinted business: -24.7% at constant currencies - Decrease of companies’ promotional and discretionary spending - Decline in line with industry trends Normalized IFO margin: 11.6% in H1 2009 compared to 14.9% in H1 2008 H1 2009 Gross profit impacted by • lower net sales in both Consumer and Promotional Products businesses • lower production volumes and continuous reduction of inventories in the Consumer business
* see glossary
67
Lighters Change in net sales at constant currencies*
Normalized* IFO margin
+ 13.1%
+ 5.8%
30.7% 26.7%
36.2% 32.3%
33.5% 29.7%
-0.5% In million euros
H109 IFO
H109 NET SALES
Net Sales
Q1 2009
Q2 2009
H1 2009
94.8
97.6
192.4
Q108
Q109
Q208 Q209
H108 H109
Europe Slight growth in net sales in H1 2009 driven by strong volumes in Q1 09 North America Good performance in H1 09 as a result of market share gains Latin America Good performance in Southern hemisphere countries, Mexico sales still soft Market share gains in most countries
Normalized IFO margin: 33.5% in H1 2009 compared to 29.7% in H1 2008 • Decrease of brand support (Child-Resistant regulation advertising campaign) • Favorable absorption of OPEX due to sales increase 68
* see glossary
Shavers – market evolution US market - % change vs YAG – Dollar sales
7.9%
7.6%
One Piece
Refillable
Total
6.30%
4.1%
3.8%
3.1% 2.5%
0.3%
0.1%
0.7%
1.2%
1.7%
-1.4% -2.3% -4.1%
2005
2006
2007
2008
May 2009
Î Overall market decreasing since the beginning of 2009 but one-piece segment still growing Î Consumers seem to be marginally trading down from systems to disposables
Source : IRI FDMX – May 09
69
Shavers Change in net sales at constant currencies*
Normalized* IFO margin
+4.6%
12.3% +2.8%
8.0% +0.6%
In million euros
Net Sales
1.5% Q1 2009
Q2 2009
H1 2009
58.9
70.9
129.8
H109 NET SALES
0.1% -1.1%
Q108
H109 IFO
2.8%
Q109
Q208 Q209
H108 H109
Europe Low single digit decrease. Launch of new products in many countries offset much of the decline of our single and twin blade products. North America Low single digit decrease in a depressed general economic climate. Consumers continue to exercise cautious spending. Latin America: Solid growth as our triple-blade one-piece business continued on a positive trend.
Normalized IFO margin: 8.0% in H1 2009 compared to 0.1% in H1 2008 Improvement mainly due to: Sales increase. Lower advertising investments compared to last year. 70
* see glossary
Other Products Change in net sales – H1 2009 +40.2%
+39.4%
+7.3%
On a comparative basis*
Consumer Business
At constant currencies*
Other Consumer Products net sales up 13.6% at constant currencies at the end of June Continuous success of phone card distribution in France
Promotional Products
As reported
Positive impact of APP consolidation in the second Quarter Net sales on a comparative basis down 16.5% Continued slowdown of the Promotional Products Industry
* see glossary
71
H1 2009 net sales evolution by geographies Change on a comparative basis*
Q109
North America & Oceania
Europe
Group
Q209
H109
Middle East, Africa & Asia
Latin America
+14.0% +12.6%
+8.1%
+2.6%
+2.3%
-0.8% -3.4%
-2.3%
-2.8% -4.7%
-3.9% -6.3% -6.7%
-6.5% -8.1%
Î See appendix page 25 for main currency impact * see glossary
72
H1 2009 net sales Consumer vs. Promotional Products Change on a comparative basis*
Q109
Q209
H109
5.00% +2.6% +1.3% +0.3% 0.00% -0.8% -2.3% -5.00%
-3.4%
-10.00%
-15.00%
-20.00% -20.3%
-25.00%
-24.5%
-28.2%
-30.00% Total Group
* see glossary
Total Group Consumer
Total Group Promotional Products
73
H1 2009: From Net Sales to IFO
Change
Change at constant currencies*
Change on a comparative basis*
713.1
+1.8%
+0.1%
-2.3%
342.9
336.4
-1.9%
101.1
100.8
- 0.3%
BIC Group In million euros
H108
H109
Net Sales
700.5
Gross Profit Income from Operations
* see glossary
74
H1 2009 Income From Operations margin
14.4%
+ 0.5
15.3%
14.9%
+ 0.6
14.1%
+ 1.6
- 1.2 - 1.8
ÎStypen factory closing costs
Î Mainly lower production volumes
ÎOngoing control of OPEX
Î Favorable benefit of lower lighter child resistant advertising expenses Î Lower brand support in shavers in the USA (BIC Soleil brand) vs. last year
H1 08
Exceptional items
H108 normalized
Gross Margin
Brand support
ÎImpact of cost reduction plan (-18.6m €) partly offset by APP negative goodwill (+10.3m €)
Other operating H109 normalized expenses
Exceptional items
H109 75
From IFO to Group Net Income BIC Group In million euros
IFO Exceptional Items
Q2 08
Q2 09
H1 08
H1 09
62.9
64.4
101.1
100.8
-3.7
-8.2
-3.7
-8.3
Normalized* IFO
66.6
72.6
104.8
109.1
Finance revenues / (costs)
5.5
-0.8
5.2
2.9
Income before Tax
68.4
63.7
106.3
103.6
Income tax
-23.0
-21.0
-35.7
-34.2
Tax rate
33.6%
33.0%
33.6%
33.0%
Income from associates Group Net Income
Net of shares outstanding net of treasury shares
1.2 45.5
43.8
1.2 70.6
Less favorable FX impact compared to last year
Cello Pens March-June 2009 Î Net sales: +8.3% Î IFO margin: 27%
70.6
48,531,424
48,131,917
48,531,424
48,131,917
EPS
0.94
0.91
1.45
1.47
Normalized EPS
0.99
1.02
1.51
1.58
* see glossary
Lower net interest income
January - June 2009 shares repurchased 48,821 (1.9M€)
76
CAPEX 90* 83 11
71
77
2nd Half
41 43 39
1st Half
FY 09 est. 60m
36
2005 *Shelton real estate acquisition (€ 11m)
45
42 32
32
2006
2007
25
2008
2009 77
Balance sheet
December 2007
June 2008
December 2008
June 2009
Inventories
333.3
354.7
304.3
323.3
Trade and other receivables
346.0
407.7
315.1
392.9
Trade and other payables
92.4
98.6
92.1
104.2
BIC Group In million euros
Working Capital
Significant enhancement in working capital: • Ongoing improvement of inventory management • Tight control of trade receivables
78
Net Cash Position + 97.8
Shareho lders remuneratio n
External Gro wth
-24.5
210.6 - 65.0
- 1.2
+ 27.0
149.2
Others
June 2009 Net Cash Position
- 63.1 -32.4
December H1 2009 cash 2008 Net Cash from operating Position activities
H1 2009 CAPEX
Dividend paid
Share buyback
Cello acquisition H109 payment
APP acquisition
79
Update on cost reduction plan Objectives Adapt our organization to the recent evolution of our key markets
Savings Approximately 30 million euros annualized savings starting in 2010 with full year expected benefits in 2011
FY 09 originally estimated costs Approximately 50 million euros partially offset by negative goodwill related to the acquisition of APP Î Net P&L impact: approximately 35 million euros fully in 2009 accounts (including APP negative goodwill)
H1 2009 realized
• Voluntary Retirement plan in the USA • Lighter and BIC Graphic plans completed in Spain • Atchison plant closed Î Total restructuring expenses: 18.6 million euros (of which 5.9 m euros cash)
Î H1 net P&L impact:
Î 8.3 million euros (including APP negative goodwill for 10.3 millions euros)
Î Full year 2009 net P&L impact estimated to be approximately 35 million euros 80
Full year 2009 expected operational trends
Stationery
Lighters
Shavers
Consumer Office Products channel should not recover before 2010 Retail channel sales will be subject to back-to-school consumer takeaway in North America and Europe, which could impact yearend reorders Stationery Promotional Products performance should be in line with H1 2009 trends
Second half of 2009 net sales should be flat compared to last year at constant currencies.
Full year 2009 net sales growth at constant currencies is likely to be in line with H1 2009 levels.
81
2009: outlook
Gain share in all categories
Protect cash generation
82
Appendix
Investor Relations Department: +33 (0)1 45 19 52 26 www.bicworld.com
H1 2009 net sales – main exchange rate evolution vs. euro
% of sales
Average rate Average rate H108 H109 % of change
US Dollar
36%
1.53
1.33
13.0%
Brazilian Real
9%
2.59
2.92
-12.9%
Mexican Peso
5%
16.19
18.46
-14.0%
Canadian dollar
3%
1.54
1.60
-4.2%
Australian dollar
2%
1.65
1.88
-13.8%
South African Zar Non Euro European countries
1%
11.75
12.27
-4.4%
9.37 36.52 3.49 0.78
10.86 44.26 4.48 0.89
-15.9% -21.2% -28.3% -15.4%
Sweden Russia Poland British Pound
5%
84
From reported IFO to Normalized IFO BIC Group In million euros
H1 08
H1 09
IFO as Reported
101.1
100.8
-
-
+3.7
-
Cost related the restructuring plan announced in April 2009
-
+18.6
Negative Goodwill related to the acquisition of Antalis Promotional Products
-
-10.3
104.8
109.1
Gain on Real Estate Cost related to the closing of the Stypen factory in France
Normalized* IFO
* see glossary
85
Consolidated P&L
BIC Group In million euros
FY07
Q108
Q208
Q308
Q408
FY08
Q109
Q209
1,456.1
308.1
392.4
363.9
356.5
1,420.9
308.4
404.7
715.0
154.7
188.3
168.7
158.3
669.9
147.9
188.5
255.8
38.2
62.9
62.0
46.5
209.6
36.3
64.4
253.5
38.2
66.6
63.5
45.8
214.3
36.3
72.6
261.2
37.8
68.4
63.9
46.1
216.3
40.0
63.7
Group net income
172.9
25.1
45.5
42.5
31.9
144.9
26.8
43.8
EPS
3.51
0.52
0.94
0.88
0.66
3.00
0.56
0.91
49,244,579
48,620,706
48,531,424
48,429,501
48,357,724
48,357,724
48,134,632
48,131,917
Net Sales Gross Profit Income from Operations Normalized IFO* Income before Tax
Number of shares (1)
*: see glossary (1) Weighted average number of shares net of treasury shares
86
Group Quarterly figures
BIC Group In million euros
FY07
Q108
Q208
Q308
Q408
FY08
Q109
Q209
1,456.1
308.1
392.4
363.9
356.5
1,420.9
308.4
404.7
YoY actual changes
+0.6%
-6.7%
-1.6%
-0.6%
-1.3%
-2.4%
+0.1%
+3.1%
YoY changes at constant currencies*
+4.7%
-0.9%
+5.8%
+4.2%
-0.1%
+2.4%
-0.8%
+0.7%
YoY changes on a comparative basis*
+3.3%
-1.8%
+4.5%
+3.0%
-0.1%
+1.6%
-0.8%
-3.4%
IFO
255.8
38.2
62.9
62.0
46.5
209.6
36.3
64.4
Normalized IFO*
253.5
38.2
66.6
63.5
45.8
214.3
36.3
72.6
IFO margin
17.6%
12.4%
16.0%
17.0%
13.0%
14.7%
11.8%
15.9%
Normalized* IFO margin
17.4%
12.4%
16.9%
17.5%
12.9%
15.1%
11.8%
17.9%
Net Sales
*: see glossary
87
Stationery Quarterly figures
BIC Group In million euros
FY07
Q108
Q208
Q308
Q408
FY08
Q109
Q209
Net Sales
714.9
145.8
202.6
172.2
152.7
673.3
130.3
189.6
YoY actual changes
-3.1%
- 8.6%
- 2.9%
-6.3%
-6.3%
-5.8%
-10.6%
-6.4%
YoY changes at constant currencies*
-0.6%
- 2.3%
+ 4.7%
-1.3%
-3.9%
-0.4%
-10.8%
-8.7%
108.0
16.2
32.1
25.5
16.7
90.5
7.5
21.0
Normalized IFO*
108.0
16.2
35.8
27.1
16.0
95.2
7.5
29.4
IFO margin
15.1%
11.1%
15.8%
14.8%
10.9%
13.4%
5.7%
11.1%
Normalized* IFO margin
15.1%
11.1%
17.7%
15.7%
10.5%
14.1%
5.7%
15.5%
IFO
*: see glossary
88
Lighters Quarterly figures
BIC Group In million euros
FY07
Q108
Q208
Q308
Q408
FY08
Q109
Q209
Net Sales
390.3
82.3
94.4
95.6
104.5
376.9
94.8
97.6
YoY actual changes
-1.1%
- 10.2%
- 2.9%
-1.0%
-0.3%
-3.4%
+15.2%
+3.4%
YoY changes at constant currencies*
+3.7%
- 4.8%
+ 4.6%
+3.5%
-0.2%
+0.8%
+13.1%
-0.5%
IFO
125.3
22.0
30.4
29.0
28.5
110.0
29.1
28.2
Normalized* IFO
125.3
22.0
30.4
29.0
28.5
110.0
29.1
35.3
IFO margin
32.1%
26.7%
32.3%
30.4%
27.3%
29.2%
30.7%
28.9%
Normalized* IFO margin
32.1%
26.7%
32.3%
30.4%
27.3%
29.2%
30.7%
36.2%
*: see glossary
89
Shavers Quarterly figures
BIC Group In million euros
FY07
Q108
Q208
Q308
Q408
FY08
Q109
Q209
Net Sales
266.7
57.8
66.9
70.6
69.0
264.3
58.9
70.9
YoY actual changes
+5.1%
- 6.3%
- 6.0%
+6.3%
+2.3%
-0.9%
+1.8%
+6.1%
YoY changes at constant currencies*
+9.2%
- 0.4%
+ 1.0%
+11.2%
+3.5%
+3.9%
+0.6%
+4.6%
IFO
22.0
0.9
-0.8
8.3
2.5
10.9
1.7
6.7
Normalized* IFO
22.0
0.9
-0.8
8.3
2.5
10.9
1.7
8.7
IFO margin
8.2%
1.5%
-1.1%
11.7%
3.6%
4.1%
2.8%
9.4%
Normalized* IFO margin
8.2%
1.5%
-1.1%
11.7%
3.6%
4.1%
2.8%
12.3%
*: see glossary
90
Other Products Quarterly figures
BIC Group In million euros
FY07
Q108
Q208
Q308
Q408
FY08
Q109
Q209
Net Sales
84.2
22.2
28.5
25.5
30.2
106.5
24.4
46.6
YoY actual changes
+35.5% + 27.1% + 31.5% +33.1%
+16.7%
+26.4%
+9.8%
+63.8%
YoY changes at constant currencies*
+37.6% + 30.5% + 36.6% +36.2%
+15.6%
+28.8%
+9.4%
+62.8%
+9.4%
+5.6%
YoY changes on a comparative basis*
*: see glossary
91
H1 09 Net Sales breakdown by category
Other Products
Shavers
10% 10%
Stationery 18% 18%
Lighters
45% 45%
27% 27%
92
H1 09 Net Sales breakdown by geography
MEAA
Latin America
5% 5% 19% 19%
North America & Oceania
Europe 34% 34%
42% 42%
93
Glossary
• At constant currencies: Constant currency figures are calculated by translating the current year figures at prior year monthly average exchange rates. • Comparative basis: at constant currencies and constant perimeter. • Normalized IFO: normalized means excluding restructuring, real estates gain and APP (Antalis Promotional Products) negative goodwill.
94
Disclaimer
This document contains forward-looking statements. Although BIC believes its expectations are based on reasonable assumptions, these statements are subject to numerous risks and uncertainties. A description of the risks borne by BIC appears in section “Risks and Opportunities” of BIC “Reference Document” filed with the French financial markets authority (AMF) on 31 March 2009
95
