Full year results. March 2012

Transcription

1 Full year results March

2 DISCLAIMER Safe Harbour Statement This presentation contains forward-looking statements (made pursuant to the safe harbour provisions of the Private Securities Litigation Reform Act of 1995). By their nature, forward-looking statements involve risk and uncertainty. Forward-looking statements represent the company s judgement regarding future events, and are based on currently available information. Consequently the company cannot guarantee their accuracy and their completeness and actual results may differ materially from those the company anticipated due to a number of uncertainties, many of which the company is not aware of. For additional factors that may cause the company s actual results to differ materially from expectations and underlying assumptions, please refer to the reports filed by the company with the Autorité des Marchés Financiers. 2

3 CONTENTS 2011 key figures 2011 key initiatives 2011 financial statements Strategic overview Outlook 3

4 2011 KEY FIGURES 2011 full year results

5 2011 KEY FIGURES Sales: 1,002.6 million Annual sales growth (at constant exchange rates) Sales growth by quarter (relative to year-earlier period, at constant exchange rates) 7% 6% 5% 4% 3% 2% +2.0% +5.6% 9% 8% 7% 6% 5% 4% 3% 2% +3.8% +7.8% +5.3% +5.3% 1% 0% -1% (0.3)% % 0% -1% Q Q Q Q Current operating margin*: 25.6% of sales Net income: 15.4% of sales (16.7% of sales excluding impact of provisions) Strong growth achieved and current operating margin maintained at high level 5 * Current operating income / total sales

6 2011 KEY INITIATIVES full year results

7 ASIA-PACIFIC INITIATIVE Acquisition of distributor GBC in Australia Consolidated since 1 June 2011 (8 months in 2011) Additional full-year sales of 30m ( 20m in 2011) Sales breakdown: 50% equipment sales / 50% recurring revenue 40% Neopost product & services / 60% others Current operating margin already improved from 12% to 14% Regional head office established in Singapore to oversee the development of Neopost s commercial presence in Asia-Pacific Direct and indirect: Australia, India, Japan Indirect: China, Indonesia, Malaysia, Singapore, Thailand From 12m in 2010, Neopost sales in the Asia- Pacific region estimated above 50m in

8 LOW-END INITIATIVE Return to entry-level products, a major segment in which Neopost is under-represented Accounts for 70-75% of the installed base, around 25% of sales Neopost has launched competitive products to address this segment Dedicated distribution channels to remotely handle this segment Optimize distribution and marketing costs Focus field sales professionals on higher $ value sales Initiative was launched in 2011 in the USA and Europe Investment of around 3m in 2011 A new sales and marketing organization to achieve higher customer service and sales productivity 8

9 ROLL OUT OF NEW OPTIMIZATION PLAN US shipping: completed Shipping centre transferred from Austin, Texas to Milford, Connecticut (February 2012) Distribution in France: completed Distribution subsidiaries Neopost France and Satas merged (December 2011) Neopost used as single brand name (March 2012) Domestic coverage optimized (March 2012) Envelope printers: completed Rena development and technical support activities transferred from Germany to Bagneux, France (Q3 2011) Adjustments related to low-end initiative: in progress Neopost is investing in its core business to increase productivity 9

10 FINANCIAL ASPECTS OF OPTIMIZATION PLAN million Provision Use 10 Cost savings (19.5)* (4) 7m- 8m in cost savings per year from 2013 onward; will contribute to finance key initiatives (15.5) Provision Use Use Use No need for further provisions, confirmed synergies 10 * Essentially cash

11 2011 FINANCIAL STATEMENTS full year results

12 2011 SALES Sales (in million) (17.1) 1, FY 2010 Change* Currency FY 2011 impacts Sales growth of +3.8% in 2011, +5.6% at constant exchange rates 12 * Excluding currency impacts

13 SALES BY AREA 2011 / 2010 change* 2011 sales: 1,002.6m North America France +5.4% +0.5% Rest of world 16% North America 40% UK +3.6% Germany 7% Germany +4.3% UK 12% Rest of world Total Group +18.5% +5.6% France 25% Growth in all markets 13 * At constant exchange rates

14 SALES PER REVENUE TYPE 2011 / 2010 change* 2011 sales: 1,002.6m Recurring revenue +3.7% Rental & leasing 28% Services and supplies 40% Equipment sales +9.8% Equipment sales 32% Growth in all revenue types 14 * At constant exchange rates

15 SALES PER BUSINESS LINE 2011 / 2010 change* 2011 sales: 1,002.6m Mailing systems +4.5% Document and logistics systems 32% Document and logistics systems +8.1% Mailing systems 68% Growth in both business lines 15 * At constant exchange rates

16 CURRENT OPERATING MARGIN Change In million % Sales 966 1, % Gross margin As % of sales % % +2.9% EBITDA % As % of sales 32.5% 31.8% Current Operating Income As % of sales % % +3.4% A high level of profitability 16 /$ 2011 = 1.39 and 2010 = 1.32 ; / 2011 = 0.87 and 2010 = 0.86

17 2011 CURRENT OPERATING MARGIN ANALYSIS Sales growth Control of costs R&D, production and operating costs Development of services, high level of postal rate changes Mix effects : positive income impact and dilutive margin impact Strong growth in equipment sales notably in top-end DS range Strong growth in countries with lower margins Investment in key initiatives Asia-Pacific Low-end A solid performance 17

18 NET INCOME EXCLUDING PROVISION FOR OPTIMIZATION PLAN In million excl. provision Change % Current operating income % Net cost of debt (32) (30) Other financial gains and losses (1) 2 Tax (59) (63) Income from associated companies 1 1 Net income % As % of sales 16.2% 16.7% EPS (attributable) % Fully diluted EPS (attributable) % Improvement in net margin excluding provision 18 /$ 2011 = 1.39 and 2010 = 1.32 ; / 2011 = 0.87 and 2010 = 0.86

19 IMPACT OF PROVISION ON NET INCOME In million excl. provision 2011 including provision Current operating income Provision for optimization - (20) Operating income Net financial income (expense) (33) (28) (28) Tax (59) (63) (55) Income from associates Net income As % of sales 16.2% 16.7% 15.4% EPS (attributable) Fully diluted EPS (attributable) Net impact of provision = 12m 19 /$ 2011 = 1.39 and 2010 = 1.32 ; / 2011 = 0.87 and 2010 = 0.86

20 CASH FLOW GENERATION In million Change % EBITDA % Other items (8) 5 Cash flow* % Change in Working Capital Requirement (8) (5) Change in lease receivables (51) (33) Interest and Income taxes paid (62) (59) Cash flow from Operations % Investments (80) (115) Cash flow after Investments % Strong growth in cash flow from operations 20 * Before net cost of debt and income tax /$ 2011 = 1.39 and 2010 = 1.32 ; / 2011 = 0.87 and 2010 = 0.86

21 HEALTHY FINANCIAL STRUCTURE In million Financial debt Cash and marketable securities Net financial debt 31/ (136) / (172) 665 Shareholders equity Net debt / shareholders equity Net debt / EBITDA ratio EBITDA / financial charges* ratio % % A strengthened equity level and covenants** that are easily met 21 * Financial charges= cost of debt ** Minimum equity of 400m and maximum leverage ratio of 3.25

22 SOLIDITY OF NEOPOST BALANCE SHEET Equity: 697m at end-january 2012 versus 606m at end-january 2011 Leasing portfolio as at end-january 2012: 617m +6%* versus end-january 2011 Rental Net present value of future rental cash flows close to 300m Net debt: 665m at end-january 2012 Leasing + rental future cash flows above 900m i.e. >> 100% of net debt Acquisitions de nouvelles technologies Debt is more than totally backed by future cash flows 22 payantes * At constant exchange rates

23 FINANCING STRUCTURE In million 1500 Availability on private Placement Natixis / BPCE - September m Availability on revolving facility - June 2013 Draw-down on revolving facility - June 2013 OCEANE- February Private Placement Crédit Agricole - December 2012 USPP - September January 09 January 10 January 11 January 12 A diversified debt 23 (1) EUR/USD exchange rate: at 31/01/2012; at 31/07/2011; at 31/01/2011; at 31/07/10; at 31/01/2010 and at 31/07/2009

24 DIVIDEND 5 4 In EPS excl. provisions EPS Dividend % cash o/w 59% cash o/w 52% cash Balance payment o/w 64% cash Interim dividend 1.80 Pay-out ratio: 75% 78% 79% 83% A proposed dividend of 3,90 per share for FY 2011, i.e. a yield close to 8%* 24 * Based on 20 March 2012 closing price ( 50.00)

25 STRATEGIC OVERVIEW full year results

26 A CLEAR VISION OF NEOPOST DEVELOPMENT Solutions not directly related to mail: Grow sales 200m* within 3 years Organic growth + partnerships + acquisitions Mail-related business: Grow sales at 2 to 3% per year excl. currency impact Maintain high level of current operating margin Continuous development in mail related business, strong growth objectives in solutions not directly related to mail 26 * At 2011 exchange rates

27 CONTINUOUS DEVELOPMENT OF MAIL RELATED BUSINESS (1/2) Gain market shares in the mailroom equipment market Grow position of #2 worldwide Extend geographical reach Double 2012 Asia-Pacific sales within 3 to 5 years Further increase positions in production mail Build upon success in high-end folders inserters Develop more direct business with postal organisations Leverage strong partnerships and knowledge of postal world Strong platform to capture a growing share of the market 27

28 CONTINUOUS DEVELOPMENT OF MAIL RELATED BUSINESS (2/2) Continue to invest in innovation Prepare launch of next generation of mailing and document systems Continue to optimize distribution network Seize opportunities to acquire a few more distributors in North America, Europe and Asia Pacific Continue to develop leasing and financial services Drive a higher level of recurring revenues and profitability Capitalise on low end initiative Achieve higher sales in entry-level segment whilst reallocating sales resources to high-end solutions High level of recurring revenues and profitability 28

29 STRONG PROSPECTS IN SOLUTIONS NOT DIRECTLY RELATED TO MAIL Portfolio of solutions not directly related to mail include: Address / data quality Shipping, tracking and tracing solutions Output management solutions Other (print finishing,...) A portfolio of solutions already built around the mail related business 29

30 NEOPOST ID: SHIPPING, TRACKING AND TRACING SOLUTIONS (1/3) Neopost ID, a strategic division of Neopost Group 165 employees (70 software engineers) Shipping Internet-based shipping engine for commercial, postal carriers and shippers Multi-carrier shipping solution for businesses Collection & delivery tracking Mobile tracking to deliver real-time visibility and improve field operations Track&Trace Data Management Customer on-line solutions to deliver tracking to all shipping chain stakeholders Proof-ofdelivery management services Improve customers invoicing and service by delivering online high-quality POD paperwork 30

31 NEOPOST ID CUSTOMERS: POSTAL CARRIERS, LARGE SHIPPERS AND RETAILERS (2/3) Parcelforce WW Royal Mail Chronopost Australia Post CyberStation Collect n Deliver CyberStation On-line shipping Tracking database EDI services CyberStation On-line shipping & mailing handhelds for collection and delivery tracking On-line shipping (international & domestic) Singapore Post DHL - METRO DHL General Motors CyberStation On-line shipping RFID Tracking & Tracing Tracking & Tracing Shipping station 31

32 NEOPOST ID: GROWTH OPPORTUNITIES (3/3) Parcel business is growing strongly, driven by development of e-commerce and international trade Tracking and tracing is key for parcels, registered mail and tracked mail as well as other items Neopost ID solutions can be provided to Neopost small and medium size customers through an Internet platform Parcels / Packages Registered mail Tracked mail Further potential to expand into shipping, tracking and tracing solutions 32

33 SUCCESSFUL DEVELOPMENT IN ADDRESS / DATA QUALITY (1/2) Satori acquired in September 2009 A US software company based in Seattle Specialized in the address quality and mail pre-sorting Address correction, elimination of duplicates Access to favorable postal tariffs Effective direct marketing actions mail delivered to recipient Optimize senders ROI and postal costs Customers => from large companies to SMEs 2009 sales: $15m of which $3m were inter-company sales High level of recurring revenues Neopost s first step in the address / data quality market 33

34 ADDRESS / DATA QUALITY: A WELL-INTEGRATED BUSINESS (2/2) Generation of sales synergies through cross selling in Neopost distribution networks Neopost as preferred channel partner: from 20 to 30% of Satori revenue in 2½ years Financial performance: 2010 and 2011 sales: double digit growth Improvement of EBIT margin ROCE of 17/18% within 2½ years New growth opportunities OEM agreement with SAP signed in December 2011 Partnership signed with Uniserv in February 2012 to develop address validation business outside the US and the UK Launch of a range of data quality software (end of 2011) Further potential to profitably expand into data quality software solutions 34

35 A CLEAR STRATEGY Continue to grow in mail-related business A mature market in which Neopost continues to create its own growth opportunities A profitable business which continues to provide strong recurring cash flows Build upon installed SMEs client base of 800,000 accounts and on efficient sales force with strong customer centric culture Enrich offering provided to SMEs around mailing and document systems Expand through organic growth and partnerships Accelerate growth through targeted acquisitions matching the following criteria Niche markets offering double digit per year growth potential Targeted ROCE 15% within 3 to 4 years Synergies with existing customers 35

36 A CLEAR SET OF OBJECTIVES 2011 total sales = 1bn 8% Projection within % 83% Mail related business Solutions not directly related to mail Mail related business Solutions not directly related to mail Continuous development in mail related business, strong growth objectives in solutions not directly related to mail 36

37 OUTLOOK full year results

38 2012 OUTLOOK Sales GBC Australia consolidated over 12 months ( 10m additional sales vs. 2011) No further acquisition in 2012 included in the guidance Lower postal rate changes revenues in 2012 compared to 2011 ( 15m) => Growth of minimum 2% expected in 2012 at constant exchange rates Current operating margin First synergies from the optimization plan Further investments in the low end initiative and in Asia-Pacific Impact of the GBC Australia consolidation over 12 months => Around 25.5% of sales in

39 APPENDIX 2011 full year results

40 CONSOLIDATED BALANCE SHEET (1/2) Assets In million 31/ / Goodwill Intangible fixed assets Tangible fixed assets Other non-current financial assets Other non-current receivables Leasing receivables Deferred tax assets Inventory Accounts receivables Other current assets Cash & marketable securities TOTAL 2,056 2,234 40

41 CONSOLIDATED BALANCE SHEET (2/2) Liabilities In million 31/ / Shareholders equity Non-current provisions Non-current financial debt Short-term financial debt Deferred tax liabilities Other non-current liabilities Prepaid income Current financial instruments 1 3 Other current liabilities TOTAL 2,056 2,234 41

42 MAILING SYSTEMS Price in $' IS IS 480 IS IS 440 IS IS 280 IS 350 IS 420 Volume envelopes per day envelopes per day >200 envelopes per day 42

43 FOLDER INSERTERS RANGE Price in K$ 250 DS DS DS DS-100/ DS DS DS DS DS Office Mailroom Mail center Production 43