Investor Presentation

Transcription

1 Investor Presentation November

2 Forward-looking statement Statements in this presentation that are not historical in nature constitute forward-looking statements. These forward-looking statements relate to information or assumptions about the effects of sales, income/(loss), earnings per share, operating income, operating or gross margin improvements or declines, Project Renewal, the European Transformation Plan, capital and other expenditures, cash flow, dividends, restructuring and restructuring-related costs, costs and cost savings, inflation or deflation, particularly with respect to commodities such as oil and resin, debt ratings, and management's plans, projections and objectives for future operations and performance. These statements are accompanied by words such as "anticipate," "expect," "project," "will," "believe," "estimate" and similar expressions. Actual results could differ materially from those expressed or implied in the forward-looking statements. Important factors that could cause actual results to differ materially from those suggested by the forward-looking statements include, but are not limited to, our dependence on the strength of retail, commercial and industrial sectors of the economy in light of the continuation or escalation of the global economic slowdown or regional sovereign debt issues; currency fluctuations; competition with other manufacturers and distributors of consumer products; major retailers' strong bargaining power; changes in the prices of raw materials and sourced products and our ability to obtain raw materials and sourced products in a timely manner from suppliers; our ability to develop innovative new products and to develop, maintain and strengthen our end-user brands; our ability to expeditiously close facilities and move operations while managing foreign regulations and other impediments; our ability to implement successfully information technology solutions throughout our organization; our ability to improve productivity and streamline operations; changes to our credit ratings; significant increases in the funding obligations related to our pension plans due to declining asset values, declining interest rates or otherwise; the imposition of tax liabilities greater than our provisions for such matters; the risks inherent in our foreign operations and those factors listed in the company s latest quarterly report on Form 10-Q and Exhibit 99.1 thereto filed with the Securities and Exchange Commission. Changes in such assumptions or factors could produce significantly different results. The information contained in this presentation is as of the date indicated. The company assumes no obligation to update any forward-looking statements contained in this presentation as a result of new information or future events or developments. This presentation contains non-gaap financial measures within the meaning of Regulation G promulgated by the Securities and Exchange Commission. Included in this presentation is a reconciliation of these non-gaap financial measures to the most directly comparable financial measures calculated in accordance with GAAP. INVESTOR RELATIONS CONTACTS: Nancy O Donnell VP, Investor Relations (770) nancy.odonnell@newellco.com Alisha Pennix Sr. Manager, Investor Relations (770) alisha.pennix@newellco.com 2

3 $6 billion business of leading brands 3

4 strong competitive positions 4

5 good year-to-date performance * through 9/30/12 2.2% Core Sales Growth +20 bps Normalized Operating Margin +6.7% Normalized EPS Growth $67M Shares Repurchased 88% Increase in Quarterly Dividend 5

6 affirmed full year guidance FY 2012 Outlook Core Sales 2% to 3% Currency Translation -1.5% to -2% Total Sales Growth 0% to 1.5% Up to +20 bps Normalized Operating Margin Normalized EPS* versus last year: Cash Flow from Operations versus last year: $1.63 to $ % to +6% + $550 to $600M about flat * See reconciliation included in the Appendix. 6 6

7 driving delivery and driving change Project Renewal SAP/EPC EMEA Indirect Procurement Program New US Customer Development Organization Strengthened Balance Sheet Working Capital Reduction Initiative 7

8 good progress...much more to do We are here Delivery Consistently do what we say Strategic Shape the future Acceleration Accelerate performance 8

9 next chapter more growth dependent than last 9

10 WHERE TO PLAY PURPOSE growth unlocks higher earnings Sources of EPS growth Other Margin NWL is a growing brand-led business with a strong home in the United States and global ambition Our Consumer brands win at the point of decision through excellence in performance, design and innovation Our Professional brands win the loyalty of the chooser by improving the productivity and performance of the user We collaborate with our supplier and customer partners across the total Newell Rubbermaid helps people flourish every da where they live, learn, work and play WIN BIGGER WIN WHERE WE ARE Growth CT&A, IP&S, LABELING, COMMERCIAL PRODUCTS FINE WRITING WRITING & CREATIVE EXPRE HOME ORGANIZATION & ST CULINARY LIFESTYLES HARDWARE * Assumes performance in line with long term objectives. For illustrative use only not to be construed as guidance. enterprise in a shared commitment to growth and creating value INCUBATE BABY & PARENTING We deliver competitive returns to our shareholders through consistent, FOR ENDICIA, MIMIO sustainable and profitable growth GROWTH RUBBERMAID MEDICAL SOL 10

11 5 WAYS TO WIN BUSINESS MODEL WHERE TO PLAY AMBITION PURPOSE Growth Game Plan directing actions Newell Rubbermaid helps people flourish every day, where they live, learn, work and play NWL is a growing brand-led business with a strong home in the United States and global ambition Our Consumer brands win at the point of decision through excellence in performance, design and innovation Our Professional brands win the loyalty of the chooser by improving the productivity and performance of the user We collaborate with our supplier and customer partners across the total enterprise in a shared commitment to growth and creating value We deliver competitive returns to our shareholders through consistent, sustainable and profitable growth WIN BIGGER WIN WHERE WE ARE INCUBATE FOR GROWTH CT&A, IP&S, LABELING, COMMERCIAL PRODUCTS FINE WRITING WRITING & CREATIVE EXPRESSION HOME ORGANIZATION & STYLE CULINARY LIFESTYLES HARDWARE BABY & PARENTING ENDICIA, MIMIO RUBBERMAID MEDICAL SOLUTIONS MAKE OUR BRANDS REALLY MATTER BUILD AN EXECUTION POWERHOUSE UNLOCK TRAPPED CAPACITY FOR GROWTH DEVELOP THE TEAM FOR GROWTH EXTEND BEYOND OUR BORDERS Sharpen brand strategies on highest impact growth levers Launch new USA customer development organization Deliver European Transformation, Project Renewal savings, and working capital reduction Drive performance culture aligned to business strategy Accelerate Latin America and Asia in Win Bigger Categories. Partner to win with customers and suppliers Develop joint business plans for new channel penetration and broader distribution Simplify everything to release costs for growth Build a more global perspective and talent base Strategic insight program in China EDGE: EVERY DAY GREAT EXECUTION 11

12 sharper portfolio choices Win bigger Win where we are Incubate for growth 12

13 resources focused to portfolio roles Win bigger Fine Commercial Writing CT&A IP&S Labeling Writing Products Win where we are Home Org & Style Culinary Lifestyles Hardware Incubate for growth Baby Mimio Endicia Medical Solutions consumer facing professional facing 13

14 growth accelerated by portfolio choices 5 Year Growth Contribution Win Bigger Win Where Are Incubate 75% 15% 10% 14

15 10 year absolute growth growth accelerated by wider footprint North America EMEA APAC Latin America APAC and L America > 30% of revenue N America ~60% of revenue EMEA ~10% of revenue revenue 15

16 requires reset of our algorithm operating income margin % full portfolio, local needs and local price points developed emerging investment in sales and marketing enabled by reducing high cost in developed world 16

17 confidence to accelerate transformation Delivery Consistently do what we say Strategic Shape the future Acceleration Accelerate performance 17

18 fast return projects enable reinvestment Project Renewal $Millions Actual to date Q312 Phase I Phase II Total Renewal Restructuring Cost $63 $90 - $100 $250 - $275 $340 - $375 Savings On Plan ($46M to date) $90 - $100 $180 - $225 $270 - $325 Payback ~1.5 years 18

19 five key work streams organization align structure to strategy EMEA transformation best cost finance best cost back office supply chain footprint 19

20 Project Renewal: expected outcomes Flatter and simplified organization with strengthened capabilities in Brand & Category Development and Execution & Delivery Accelerated release of costs, the majority of which will be invested in faster growth and the geographic expansion of our leading brands A greater line of sight to earnings and operating cash flow growth while the company invests to accelerate performance Strengthened leadership team that can drive faster implementation of Growth Game Plan 20

21 aligning structure with strategy Make brands really matter Build an execution powerhouse Unlock trapped capacity for growth Extend our boundaries Develop a growth team 21

22 two capabilities of equal stature Interdependent and Equal in Importance development delivery big brand ideas high impact innovation superior products and design e-brand building e-commerce specific responsibilities shared accountability strategic customer management strategic channel management market-leading supply chain superior service at best cost 22

23 six new business segments writing tools industrial home solutions commercial products baby specialty office 23 23

24 a new Newell Executive team Chief Executive Officer Michael B. Polk Chief Operating Officer Bill Burke Chief Development Officer Mark Tarchetti Chief Financial Officer Doug Martin Chief Human Resource Officer Jim Sweet Chief Legal Officer/EMEA Lead John Stipancich Chief Supply Chain Officer Meri Stevens Chief Design and R&D Officer Chuck Jones Chief Information Officer Gordon Steele Chief Customer Officer Joe Cavaliere Chief Marketing & Insights Officer Richard Davies 24

25 Key leadership appointments William A. Burke III Chief Operating Officer Mark Tarchetti Chief Development Officer 25

26 Key leadership appointments Joe Cavaliere Chief Customer Officer Meredith Stevens Chief Supply Chain Officer 26

27 Key leadership appointments Richard Davies Chief Marketing & Insights Officer Chuck Jones Chief Design and R&D Officer 27

28 Compelling value creation story Delivery Consistently do what we say Strategic Shape the future Acceleration Accelerate performance 2012/ / and beyond Consistent growth (sales, EPS) Strengthened leverage metrics Increased dividends Repurchased shares Accelerated growth (sales, EPS) Strong earnings and cash flow Increased dividends Surplus cash 28

29 Strong cash flow and increased borrowing capacity enables value creation flexibility for shareholders ~$3.5B Operating cash flow $3.5B Operating cash flow $3.5B Next 5 years* ~$3.5B Dividends $0.7B Share repurchase $0.3B Capex $1.0B $1.5B Uncommitted Free Cash Flow Uncommitted free cash flow provides flexibility ~$1.5 billion in uncommitted 1. Acceleration free in cash flow emerging over next markets 5 years provides 2. Accelerated flexibility cost for: reductions Accelerated structural cost 3. Increased dividends reductions and/or share Increased dividends repurchases 4. Share Bolt-on repurchase acquisitions Bolt-on acquisitions Increased borrowing capacity adds even more flexibility * Assumes performance in line with long term objectives. For illustrative use only not to be construed as guidance. 29

30 Investment thesis strong Growth Game Plan will drive accelerated performance Driven by sharper portfolio choices and strengthened capabilities Opportunity to release unproductive costs to fund investment Strong, growing free cash flow provides fuel for accelerated performance and returns to shareholders 30

31 Appendix 31

32 Reconciliation: Q3 YTD 2012 and Q3 YTD 2011 Core Sales Newell Rubbermaid Inc. RECONCILIATION OF NON-GAAP INFORMATION Core Sales (dollars in millions) Core Sales Q Q Q Nine months ended September 30, 2012 Sales as reported $ 1,332.4 $ 1,516.2 $ 1,535.3 $ 4,383.9 Currency Impact Core Sales (1) $ 1,340.2 $ 1,551.1 $ 1,573.8 $ 4,465.1 Q Q Q Nine months ended September 30, 2011 Sales as reported $ 1,274.2 $ 1,545.3 $ 1,549.9 $ 4,369.4 Including Currency 0.3% Excluding Currency 2.2% Currency impact (1.9)% (1) "Core Sales" is determined by applying the prior year monthly exchange rates to the current year local currency monthly sales amounts, with the difference in the current year reported sales and Core Sales representing changes attributable to foreign currency translation, reported in the table as "Currency Impact"

33 Reconciliation: Q3 YTD 2012 and Q3 YTD 2011 Operating Income, As Reported, to Normalized Operating Income $ millions Q3 YTD 2012 Q3 YTD 2011 Net sales $4,383.9 $4,369.4 Operating income (as reported) $498.1 $131.7 CEO transition costs $ - $4.4 Impairment charges $ - $382.6 Restructuring and restructuring-related costs $66.6 $38.1 Operating income (normalized) $564.7 $556.8 Operating margin (normalized) 12.9% 12.7% 33 33

34 Reconciliation: Q3 YTD 2012 and Q3 YTD 2011 Normalized EPS Q3 YTD 2012 Q3 YTD 2011* Diluted earnings per share (as reported): $1.02 $0.15 Impairment charges $0.00 $1.03 Restructuring and restructuring-related costs $0.18 $0.12 Discontinued operations ($0.01) $0.03 CEO transition costs $0.00 $0.01 Income tax - discrete contingencies, expiration of statutes of limitation and resolution of examinations $0.07 ($0.17) Loss related to the extinguishment of debt $0.01 $0.01 "Normalized" EPS $1.27 $1.19 * totals may not add due to rounding 34 34

35 Reconciliation: Full Year 2012 Outlook for Normalized EPS FY 2012 Diluted earnings per share $1.27 to $1.33 Restructuring and restructuring-related costs [ 1 ] $0.27 to $0.32 Discontinued operations ($0.01) Income tax - discrete contingencies, expiration of statutes of limitation and resolution of examinations $0.07 Loss related to the extinguishment of debt $0.01 "Normalized" EPS $1.63 to $1.69 [ 1 ] Restructuring and restructuring-related costs include impairment charges, employee termination benefits and other costs associated with the European Transformation Plan and Project Renewal