2
3
F ina nc ia l Upda te
5
Clo sure o f Impulse Me rc ha nd ising Divisio n 10.6% Re ve nue fro m c o ntinuing o pe ra tio ns $279.5m Re d uc tio n in lo w ma rg in priva te la b e l a nd a g e nc y sa le s Impro ve d c o ntrib utio n ma rg ins 0.5% E a rning s b e fo re inte re st a nd ta x $24.0m Re d uc e d se lling a nd d istrib utio n c o sts Ad ve rse AUD/ USD c urre nc y impa c t Sig nific a nt re d uc tio n in b o rro wing c o sts 14.6% Pro fit b e fo re ta x $19.6m d ue to 27% re d uc tio n in d e b t a nd re d uc e d e ffe c tive inte re st ra te 17.7% Pro fit a fte r ta x $13.7m 12.3% E a rning s pe r sha re 13.2c ps * Unde rlying a mo unts e xc lude the re sults o f the Ho use wa re s JV (dive ste d 31 Ma rc h 2016) a nd the o the r sig nific a nt, no n-re c urring ite ms o utline d o n Slide 8 6
Re duc tion in 0.2 c oope ra tive a dve rtising Va rious Othe rs F X Impa c t c osts 2.5 Re duc tion in 1.4 Re duc tion in se lling a nd borrowing distribution (6.4) 2.6 c osts c osts $19.6m Improve me nt $17.1 3.0 in c ontribution (0.8) ma rg ins Re duc tion in Home Applia nc e s E BIT i) De mise of sig nific a nt c ustome r ii) Comme rc ia l Cha nne l F Y16 F Y17 7
Sig nific a nt Ite ms A$m F Y2017 F Y2016 Impa irme nt o f Ho me Applia nc e s inta ng ib le s (12.0) - Impa irme nt o f Re vita na il b ra nd (6.9) - Impa irme nt o f Ne w Ze a la nd b usine ss se g me nt (2.7) - Re struc ture c o sts (1.6) (5.8) Bo nd b uy b a c k c o sts (1.2) (0.2) Pro fit o n dive stme nt o f IMD Sing a po re 0.2 - Ga in o n Sa le o f Ho use wa re s JV - 2.0 L e g a l a nd a c q uisitio n c o sts - (0.2) T ota l Sig nific a nt Ite ms be for e T a x (24.2) (4.2) T a x b e ne fit o n Sig nific a nt Ite ms 1.3 1.8 T ota l Sig nific a nt Ite ms Afte r T a x (22.9) (2.4) 8
$30.8m o pe ra ting c a sh flo w b e fo re Und e rlying Ca sh Co nve rsio n* 113% inte re st a nd ta x pa yme nts Stro ng o pe ra ting c a shflo w 27.0% Ne t De b t $36.4m Impro ve d wo rking c a pita l e ffic ie nc y 3.1pp Ge a ring 29.2% Stro ng fina nc ia l pla tfo rm 0.6pp ROF E ** 15.4% So lid re turn o n fund s e mplo ye d 1.6 time s No rma lise d E BIT Inte re st Co ve r 5.4 time s E BIT *** / Inte re st† 0.6 time s No rma lise d le ve ra g e Ra tio 1.3 time s Ne t De b t / E BIT DA*** * Ope ra ting c a shflo w / Unde rlying E BI T DA e xc luding no n-re c urring ite ms. **Unde rlying E BI T / T o ta l funds e mplo ye d. $20.6m impa irme nt o f inta ng ib le s (a fte r ta x) a dde d b a c k to funds e mplo ye d. *** Unde rlying E BI T a nd E BI T DA e xc lude sig nific a nt, no n-re c urring ite ms † I nte re st no rma lise d to e xc lude b o nd b uyb a c k c o sts 9
Ope ra tio na l Upda te
11
HE AL T H WE L L NE SS BE AUT Y HAPL 22% H,W& B Ne t Sale s 61% Ag e nc y Contr ibution 17% 12 So urc e : Industry Re ve nue Co mplime nta ry Me dic ine s Austra lia 2015 (2017 E st), Co sme tic s/ T o ile try re ta iling IBI SWo rld 2017 E st
T ra ditio na l F o c us b e yo nd Ag ing Hig h Cha nne ls dispe nsing to Po pula tio n Gro wth sa le s fla t fro nt o f sho p o ve r 4 ye a rs China se e king hig h q ua lity AU a nd NZ H,W & B Bra nds 13
>66% $4.6 Bill 1.3 Mill +15% H&W Austra lia ns use E st. Ind ustry re ve nue Pe o ple a d d CM to CAGR c o mplime nta ry 2017-18 e xisting tre a tme nts me d ic ine (CM)) $4.0 Bill +3.2% Be a uty E st. Ind ustry re ve nue CAGR 2017-18 14
15
200 Bub b le Size = Ca te g o ry Va lue Mn AUD 180 Avg . = 0.03% 160 Nutritio na l Oils Bo ne He a lth 140 Ma r’ 2017 Multi Vita mins 120 Arthritis (Mn AUD) 100 Inte stina l He a lth Va lue MAT Pre g na nc y 80 Co ld & F lu Re lie f Musc ula r Suppo rt 60 Cystitis Re lie f Iro n De fic ie nc y He a rt He a lth Sinus & Ha yfe ve r Skin He a lth 40 Re lie f Immune Suppo rt E ne rg y Suppo rt Cle a nsing Antio xida nts Inso mnia Suppo rt Va lue = 30 Mn AUD E ye Ca re L ive r He a lth 20 Mo o d & Anxie ty Suppo rt Dig e stive He a lth Bra in He a lth Me no pa use Bo we l He a lth Circ ula tio n Stre ss Re lie f L ib ido Ha ng o ve r Re lie f Spo rt Mig ra ine Ve in Ca re Co ld So re Re lie f 0 Cho le ste ro l We ig ht L o ss Suppo rt Va g ina l Ca re Na use a Re lie f Othe r Use F luid Re te ntio n -20 -42 -39 -36 -33 -30 -27 -24 -21 -12 -9 -6 -3 0 3 6 9 12 15 24 27 57 60 % Gro wth Vs. PY. Me a sure : Va lue Mn AUD
17
I nc re a se d c o mme rc ia l fo c us a nd • e xe c utio n c a pa b ilitie s with o ur “b ig 6” c usto me rs Driving mutua l g ro wth thro ug h jo int • b usine ss pla nning 100 Pric e line 80 CWH 60 Pha rma c y c ha nne l sa le s mo re tha n I nd PHY • do ub le d in the pa st six ye a rs 40 20 0 F Y 11 F Y 12 F Y 13 F Y 14 F Y 15 F Y16 F Y 17 18
Ka re n Murre ll – All Na tura l L ipstic ks pa rtne rship Do me stic a nd e xpo rt stra te g ic pa rtne rship • Bundling o ppo rtunitie s with o the r b ra nds • Po te ntia l to a dd ma rg in tha t c a n b e re c yc le d into o the r b ra nds • Wolff – E uro pe a n Allia nc e pa rtne rship Dr All pro duc ts ha ve a uniq ue b ra nd po sitio ning a nd • stro ng g lo b a l distrib utio n E xpa nds o ur po rtfo lio a nd pro vide s sc a le in $1.2B • ha irc a re c a te g o ry Ha s the po te ntia l to a dd o ve r $10m in re ve nue tha t c a n • b e re inve ste d in o ur o wn b ra nds 19
K ing sg ro ve DC F a c ility is a sig nific a nt e na b le r to re inve st in Mc Phe rso n’ s b ra nds • De live re d sig nific a nt e ffic ie nc ie s to fre e up supply c ha in c a pa c ity • Ne xt ste ps will b e a b o ut b uilding o n the pla tfo rm fo r the future ; • Stra te g y , Pla nning & Sa le s & K e y Ac c o unt E xpo rt Re se a rc h & De ve lo pme nt Inno va tio n Ma na g e me nt 20
Spe c ia lise in na tura l, g o o d va lue – mid tie r • skinc a re a nd he a lth b ra nds Wo rking to g e the r to drive A’ kin in • 5 sta r T ma ll T P sto re o pe ra to r the UK a nd E U • Se c ure d the o pe ning o f Akin’ s Offic ia l T ma ll • A’ kin ha s b e e n po sitio ne d a s a • sto re . stra ig htfo rwa rd a nd simple T a rg e te d purc ha se s o f $1m in Ye a r 1 • c ho ic e to a c o nfuse d c usto me r. Distrib ute d thro ug h Ho lla nd & • Ba rre tt, Who le fo o ds ma rke t, Spe c ia lise in Pre mium skinc a re b ra nds • Na turismo , Wa itro se , Ae r L ing us, F o c us will b e o n L umino sity a nd E te rna l Yo uth • T ho ma s Co o k. E xc lusive re pa c ka g e d ra ng e (b a se d o n K o re a n • de sig n) o f L umino sity fo r China o nly. T a rg e te d purc ha se s o f $1m in • F o re c a sting purc ha se s o f $2.0m in Ye a r 1 Ye a r 1 • Ma rke ting a nd b uilding the b ra nd in China fro m • virtua lly ze ro pre se nc e . 21
Outlo o k
‘Mc Phe r so n’s, a jo ur ne y o f pr o fitable gr o wth…’ 23
Appe ndix
L aur e nc e Paul David Smith Br e tt Owe r s Sar ah T ully L or i Pir ozzi Byr on Stone Mc Alliste r Withe r idge Busine ss Ne w Busine ss HR Dire c to r Natio nal F ie ld Sale s De ve lo pme nt Co mme rc ial Ac c o unts & Dire c to r Manag ing CF O Dire c to r F inanc e E xpo rt Dire c to r Dire c to r Dire c to r Donna Mar y Mar k Br ady David Sammy John Re be c c a Chan Pe ar c e Supply Chain F ie lding Chan Ce r e sa Wake fie ld Dire c to r Marke ting R&D Dire c to r Strate g y, MD MCP GM HAPL E xe c utive Dire c to r Planning & Ho ng Ko ng Assistant I nno vatio n Dire c to r 25
10.6% de c re a se in Sa le s Sa le s 279.5 312.6 Co st o f Go o ds So ld 160.1 179.5 Gro ss Co ntrib utio n 119.4 133.1 13.4% de c re a se in E xpe nse s E xpe nse s 92.1 106.4 E BIT DA 27.3 26.7 2.2% inc re a se in E BI T DA De pre c ia tio n & a mo rtisa tio n (3.3) (2.8) 0.5% inc re a se in E BI T E BIT 24.0 23.9 Inte re st (4.4) (6.8) I nte re st c o ve r 5.4 time s NPBT 19.6 17.1 14.6% inc re a se in NPBT T a x (5.9) (5.5) 17.7% inc re a se in NPAT NPAT 13.7 11.6 E PS (c e nts) 13.2 11.8 E PS (inc luding no n-re c urring ite ms) (c e nts) (8.8) 11.1 T o ta l divide nd (c e nts – fully fra nke d) 8.0 8.0 * T he impa c t o f the Gro ups 49% inte re st in the Ho use wa re s JV is e xc lude d fro m F Y16 a s it wa s dive ste d o n 31 Ma rc h 2016. 26
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