financial year 2011 results presentation · (total savings in 2011: chf 15 million) strategy on...
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Financial Year 2011Results Presentation
Media and analysts' conference
Lucerne, 29 March 2012
Welcome addressKonrad Graber, Chairman of the Board of Directors
Market situation and outlookUrs Riedener, CEO
Most important success factorsUrs Riedener, CEO
Annual results 2011Reto Conrad, CFO
Overview of the financial year 2011Urs Riedener, CEO
Financial Year 2011, Results Presentation, 29 March 2012 Page 3
§ Net sales of CHF 2,721 million 1.4% increase
§ EBIT of CHF 130.3 million4.0% decrease> EBIT margin 4.8% (2010: 5.1%)
§ Net profit of CHF 83.0 million 3.7% decrease> Net profit margin of 3.0% (2010: 3.2%)
Highlights of 2011
Slight increase in sales – profitability virtually maintained
Welcome addressKonrad Graber, Chairman of the Board of Directors
Market situation and outlookUrs Riedener, CEO
Most important success factorsUrs Riedener, CEO
Annual results 2011Reto Conrad, CFO
Overview of the financial year 2011Urs Riedener, CEO
Financial Year 2011, Results Presentation, 29 March 2012 Page 5
Switzerland§ Slight decline due to elimination of unprofitable
business> Sales of CHF 1,909.9 million, -2.2%> Retail business, the core area, remained stable
International§ Significant growth despite strong Swiss franc
> Sales of CHF 811.4 million, +10.9%> +21.3% in local currency
Pleasing sales despite import pressure and strong Swiss franc
International business at the upper range of expectations
Financial Year 2011, Results Presentation, 29 March 2012 Page 6
§ Focus on selected market concepts and markets with potential
§ Powerful innovations in Switzerland: Mozzarella Mini Marinati, Milk Shake, Yogurt Milk
§ Successful local products abroad: Onken, Trentina, Cypress Grove Chèvre, Emmi Roth USA
§ Acquisitions with further potential: Onken, A-27, Rutz Käse
§ Elimination of unprofitable business outside the core area
§ Systematic cost management along with additional, exceptional savings (total savings in 2011: CHF 15 million)
Strategy on course
Strengthening of key markets, investments in productivity
Financial Year 2011, Results Presentation, 29 March 2012 Page 7
Amounts in CHF million 2011 2010 2009 2008 2007Net sales 2 721 2 684 2 619 2 671 2 501Earnings before interest, taxes, depreciation and amortization (EBITDA) as % of net sales
239.3
8.8
233.6
8.7
208.3
8.0
184.4
6.8
140.1
5.6
Earnings before interest and taxes (EBIT)as % of net sales
130.34.8
135.85.1
109.04.2
102.13.8
62.32.5
Net profitas % of net sales
83.03.0
86.13.2
75.32.9
58.72.2
41.31.6
Headcount (FTEs) 3890 3 701 3 525 3 373 3 350Volume of milk and cream processed in millions of kg
1 017 992 943 948 901
Facts and figures for financial year 2011
Sales and income exceed expectations
Financial Year 2011, Results Presentation, 29 March 2012 Page 8
%
5.6
6.8
8.08.7 8.8
2.5
3.84.2
5.1 4.8
1.62.2
2.9 3.2 3.0
0
1
2
3
4
5
6
7
8
9
2007 2008 2009 2010 2011
EBITA margin EBIT margin Net profit ratio
5-year trend in profits
Operating and net profit ratios almost doubled, steady increase of EBITDA
Financial Year 2011, Results Presentation, 29 March 2012 Page 9
Acq.: effects due to acquisitions; FX: foreign currency effects; Volume: volume effects; Price: price effects
Sales trends 2011 – Group
Organic decline 1.9%
2683.7 2721.3
+6.1% -2.8% -2.5% +0.6%
2010 Acq. FX Volume Price 2011
organic -1.9%
Financial Year 2011, Results Presentation, 29 March 2012 Page 10
Acq.: effects due to acquisitions; FX: foreign currency effects; Vol.: volume effects; Price: price effects
Sales – Switzerland Sales – internationalin CHF million in CHF million
2.2% decrease:- Favourable development of proven brand concepts - Successful launch of new products- Stable position in the retail business- Elimination of unprofitable business (logistics)- Pressure due to imports, especially on low-margin business
10.9% growth:- Growth at upper end of expectations- Emmi Caffè Latte maintains its position abroad- Local production supports growth- Recent acquisitions developing nicely
Sales trends 2011 – in Switzerland and abroad
Stable domestic core business, intl. growth despite strong Swiss franc
1951.9 1909.9
+1.5% -3.7% -
2010 Acq. Vol. Price 2011
organic -3.7%
731.8 811.4
+18.1% -10.4%+0.9% +2.3%
2010 Acq. FX Vol. Price
organic +3.2%
Financial Year 2011, Results Presentation, 29 March 2012 Page 11
Sales of cheese Sales of fresh products Sales of dairy productsin CHF million in CHF million in CHF million
2.1% decrease:- Good development with Raclette- Growth in sales due to Fromalp
(acquired in July 2010)- Lower prices for Emmentaler- Declines in generic volumes and trading
0.3% growth:- Growth of Caffè Latte- Successful launch of Milk Shake- Stable trend with Energy Milk- Declines with private labels
1.2% decrease:- Positive influence through
increasing milk prices in 1HY- Slightly lower volumes
Acq.: acquisition effects; Vol.: volume effects; Price: price effects
Sales trends – Switzerland
Good performance of brand concepts, increasing import pressure
546.0 534.8
+5.1% -5.7% -1.5%
2010 Acq. Vol. Price 2011
organic -7.2%
717.2 708.4
+0.3% -2.8% +1.3%
2010 Acq. Vol. Price 2011
organic -1.5%
369.6 370.5
- -0.8% +1.1%
2010 Acq. Vol. Price 2011
organic +0.3%
Financial Year 2011, Results Presentation, 29 March 2012 Page 12
Sales of fresh products Sales of fresh cheese Sales of cheesein CHF million in CHF million in CHF million
5.3% decrease:- Double-digit growth of
local production at Emmi Roth USAand Cypress Grove Chèvre
- Declines in exports from Switzerland, lower prices for Emmentaler
31.7% growth:- Good collaboration with
Venchiaredo in Italy- Expansion of the Trentina brand
(Stracchino and Mozzarella)
Acq.: effects due to acquisitions; FX: foreign currency effects; Vol.: volume effects; Price: price effects
41.3% growth:- Double-digit growth at Onken in the UK- Good growth with Caffè Latte,
especially in the UK, Benelux and Spain - Declines in yoghurt exports
Sales trends – international
Caffè Latte and local production abroad drive success
191.5270.5
+54.2%
-9.1% -4.8% +1.0%
2010 Acq. FX Vol. Price 2011
organic-3.8%
33.243.7
- -15.0%
+38.7% +8.0%
2010 Acq. FX Vol. Price 2011
411.6 389.8
+6.6% -11.3%-3.6% +3.0%
2010 Acq. FX Vol. Price 2011
organic +46.7%
organic-0.6%
Financial Year 2011, Results Presentation, 29 March 2012 Page 13
0
20
40
60
80
100
120
140
160
180
2009 2010 2011
Exchange-rate driven loss in sales since 2008
Loss in sales of CHF 180 million in 3 years
CHF million
§ With a stable exchange rate since the beginning of 2009, international sales would have been more than 20% higher!
Welcome addressKonrad Graber, Chairman of the Board of Directors
Market situation and outlookUrs Riedener, CEO
Most important success factorsUrs Riedener, CEO
Annual results 2011Reto Conrad, CFO
Overview of the financial year 2011Urs Riedener, CEO
Financial Year 2011, Results Presentation, 29 March 2012 Page 15
9.8.
Acquisition of Onken
Impairments in goodwill,tangible assets
Sale of a property in Thun
3.1. 1.7.30.6.
Refinancing
Acquisition Rutz Käse Group
EUR/CHF parity (1.01)
An overview of the financial year
1.8.
SNB intervention (EUR/CHF 1.20)
1.12.15.9.
6.9.
Acquisition A-27 Group
Further development in a turbulent environment
Financial Year 2011, Results Presentation, 29 March 2012 Page 16
Currency- and competition-relatedpressure on gross profit margin wascompensated by:
§ Price increases abroad
§ Elimination of unprofitable business
§ Improved product mix (e.g. impact of recently acquired businesses)
§ Productivity gains in production facilities
+1.6892.5
33.3
907.1
33.3
Gross operating profitas % of net sales
+1.42 683.72 721.3Net sales∆ in %20102011in CHF million
Net sales to gross profit
Increase in gross profit thanks to the optimized product portfolio
Financial Year 2011, Results Presentation, 29 March 2012 Page 17
-4.0135.85.1
130.34.8
EBITas % of net sales
-51.61.40.7Release of badwill
+10.499.2109.6Depreciation and amortization
+2.4233.68.7
239.38.8
EBITDAas % of net sales
+3.3662.924.7
684.525.1
Total operating expensesas % of net sales
+1.6892.5
33.3
907.1
33.3
Gross operating profitas % of net sales
+1.42 683.72 721.3Net sales∆ in %20102011in CHF million § Disproportionate increase in
operating expense (+3.3%), primarily due to acquisitions
§ Profit from sale of properties, particularly in Thun
§ Increase in depreciation, among others through complete write-off of goodwill at Trentinalatte (CHF 10.2 million)
§ Slight decrease in EBIT margin of 5.1% to 4.8%
Gross profit to EBIT
Second-best EBIT in Emmi's history
+516.93.115.9Profit from sale oftangible assets
Financial Year 2011, Results Presentation, 29 March 2012 Page 18
135.8130.3
-10.4 -0.7-9.1-12.6+14.5
Gross profit PersonnelOther
Operating expenseWrite-back Negative goodwill
Depreciation/amortization
Grossprofit
Personnelexpense
Other operating expense
Release ofbadwill
Depreciation/amortization
Factors driving EBIT
Increase in costs due primarily to acquisitions
2010 2011
InCHF mio.
+12.8
Profit fromsale of fixed assets
Financial Year 2011, Results Presentation, 29 March 2012 Page 19
Targeted use of resources optimizes costs
in CHF million 2011 2010∆ in
%Personnel expensesas % of net sales
344.812.7
332.212.4
+3.8
Advertising and marketing expensesas % of net sales
105.2
3.9
107.6
4.0
-2.2
Occupancy expenses, maintenance, leasing
65.0 66.9 -2.8
Energy, operating material and supplies
52.4 49.7 +5.4
Logistics expenses 66.6 59.6 +11.8Other operating expenses 50.5 46.9 +7.6Total operating expensesas % of net sales
684.5
25.1
662.9
24.7
+3.3
§ Increase in personnel expenses of 3.8% due to acquisitions
§ Decrease in marketing expenses of 2.2% due to increased focus in the international business
§ Occupancy expenses, maintenance: savings through operational excellence
§ Energy: higher prices
§ Logistics: increase due to acquisitions
Systematic cost management
Financial Year 2011, Results Presentation, 29 March 2012 Page 20
Exceptional income and expenses 2011
Exceptional influences in 2011 balance each other out
in CHF million 2011 2010 ∆ in % EBIT, as published 130.3 135.8 -4.0Profit from sale of tangible assets
-15.9 -3.1
Impairments 15.8 11.0Sustainable EBIT 130.2 143.7 -9.3
Gain on the disposal of fixed assets
§ Sale of property in Thun CHF 15.5 million
Impairments
§ Trentinalatte CHF 10.2 million- Outlook is negative for
private labels, but good for the Trentina brand
§ Tangible assets, frozen storage in Ostermundigen CHF 2.3 million- Relocation of frozen storage,
conversion of infrastructureto chilled storage
Financial Year 2011, Results Presentation, 29 March 2012 Page 21
Net profit margin makes it over the 3% barrier
-0.5916.1015.51Profit per share in CHF
-3.186.13.2
83.03.0
Net profitas % of net sales
-2.018.420.4Minority interests
-7.815.813.1
23.618.6
Income taxesAverage tax rate in %
+6.7120.3127.0Earnings before taxes (EBT)
+11.2-18.2-7.0Financial result
+1.02.73.7Income from associated companies
-5.5135.8130.3EBIT∆ 20102011in CHF million § Improved FX result thanks to
prudent hedging strategy and good FX trend in Q4
§ Higher tax expense due to - increasing proportion of
international business- exceptional value adjustment
of deferred tax credit
§ Profit per share CHF 15.51 (previous year, CHF 16.10)
EBIT to net profit
Financial Year 2011, Results Presentation, 29 March 2012 Page 22
§ Positive currency result thanks to effective hedging measures and positive currency trend in Q4
§ Interest result: Increase in interest expense due to additional liabilities taken on for acquisitions
in CHF million 2011 2010 ∆ Currency result 1.7 -17.1 +18.8Interest result -7.7 -4.2 -3.5Other financial result -1.0 +3.1 -4.1Total financial result -7.0 -18.2 +11.2
Financial result
Significantly improved financial result
-
50
100
150
200
250
2012 2013 2014 2015 2016 2017 2018
in m
io. C
HF
used credits/limits free limits
Maturity of used and not used credits/credit lines
Maturity of credits/credit lines
Financial Year 2011, Results Presentation, 29 March 2012 Page 23
Financial Year 2011, Results Presentation, 29 March 2012 Page 24
in CHF million 2011 2010 ⊗ Operating cash flow 218.3 222.4 -4.1Change in net current assets -42.1 -15.8 -26.3Other -25.8 -30.2 +4.4Cash flow from operating activities 150.4 176.4 -26.0Investments in tangible assets -94.8 -105.0 +10.2Investments in intangible assets -3.2 -2.0 -1.2Other investments -171.1 -44.1 -127.0Cash flow from investing activities -269.1 -151.1 -118.0Cash flow from financing activities 101.3 -1.8 +103.1Effects of currency translation -2.1 -8.5 +6.4Net change in cash and cash equivalents -19.5 15.0 +34.5
Cash flow (1/2)
Operating cash flow continues to be strong
Financial Year 2011, Results Presentation, 29 March 2012 Page 25
§ Expansion of milk processing and process optimization of UHT production in SuhrTotal CHF 11.2 million, 2011 CHF 8.0 million (remainder in 2012)
§ Expansion of cheese curing cellar in SaignelégierTotal CHF 8.4 million, 2011 CHF 2.7 million (remainder in 2012)
§ Expansion of processed cheese production in LangnauTotal CHF 6.0 million, 2011 CHF 2.3 million (remainder in 2012)
§ Merging of distribution centre in SchlierenTotal CHF 4.7 million (completed)
§ Expansion of yoghurt production in the USATotal CHF 2.3 million (completed)
Cash flow (2/2)
Largest investment projects
Financial Year 2011, Results Presentation, 29 March 2012 Page 26
306 287
181 192
342
2.19
1.56
0.87 0.82
1.43
0
1
2
3
0
50
100
150
200
250
300
350
400
2007 2008 2009 2010 2011
Net Debt Net Debt / EBITDA Ratio
in CHF million Factor
Limit of net debt
§ Issue of a bond due to advantageous conditions- the result is higher
net financial liabilities
§ As before, net debt/EBITDA ratio is considerably lower than the established limits
§ Continued large financial potential for future investments
Key figures for 2011 (1/4)
Net debt/EBITDA
Financial Year 2011, Results Presentation, 29 March 2012 Page 27
1635 1683 16551729
1949
47.9 49.655.3 56.5
52.4
0
10
20
30
40
50
60
70
0
200
400
600
800
1000
1200
1400
1600
1800
2000
2007 2008 2009 2010 2011
Balance sheet total Equity ratio
in CHF million in %
Target equity ratio in %
§ Equity ratio remains clearly above targets
§ Equity basis for additional financing remains very stable
Key figures for 2011 (2/4)
Equity ratio
Financial Year 2011, Results Presentation, 29 March 2012 Page 28
10161107 1114
11121267
5.8
7.68.4
9.88.8
0
2
4
6
8
10
0
200
400
600
800
1000
1200
2007 2008 2009 2010 2011
Invested capital ROI
in CHF million in %
§ Decrease in ROI to 8.8%
§ Investments made in the second half did not yet fully impact the income in full-year 2011
§ Impact of slight decrease in earnings
Key figures for 2011 (3/4)
Return on invested capital (ROI)
Financial Year 2011, Results Presentation, 29 March 2012 Page 29
§ The Board of Directors proposes to the General Meeting a constant dividend of CHF 3.40
§ The BoD expects a future distribution rate of 20 - 25%
7.52
10.98
14.0816.10 15.51
2.60 2.60 3.00 3.40 3.40
34.6
23.721.3 21.1 21.9
0
5
10
15
20
25
30
35
40
0.00
3.00
6.00
9.00
12.00
15.00
18.00
2007 2008 2009 2010 2011
EPS Dividend Distribution rate
in CHF in %
Key figures for 2011 (4/4)
Constant dividend
Welcome addressKonrad Graber, Chairman of the Board of Directors
Market situation and outlookUrs Riedener, CEO
Most important success factors Urs Riedener, CEO
Annual results 2011Reto Conrad, CFO
Overview of the financial year 2011Urs Riedener, CEO
Financial Year 2011, Results Presentation, 29 March 2012 Page 31
The strategic pillars at Emmi
Defend our domestic position
International growth
Cost management
Emmi strengthens its international footprint and constantly improves its competitiveness
Financial year 2011, Results Presentation, 29 March 2012 Page 32
Trend analysis as the basis for innovation
§ Taste
§ Health
§ Convenience
§ Sustainability
Lactose-free "All Natural" Toni
Key trends for Emmi in the food sector
Financial year 2011, Results Presentation, 29 March 2012 Page 33
Innovation at Emmi: Milk Shake
Sampling
Posters / Print Media
Sponsorship
TV
2nd POS
Internet / Social Media
Promotions
Trade Fairs / Tasting
PoP activation
Cross-communication with UHT Milk
Successful launch in the spring of 2011 Defence of position within Switzerland
Financial year 2011, Results Presentation, 29 March 2012 Page 34
Innovation at Emmi: Mini Marinati mozzarella
Mozzarella Mini Marinati
Internet / Social Media
Promotions
Trade Fairs / Tasting
Cross-communicationwith milk
PoP activation
Mozzarella speciality off to a good start Defence of position within Switzerland
Financial year 2011, Results Presentation, 29 March 2012 Page 35
0
10
20
30
40
50
60
70
80
90
100
2007 2008 2009 2010 2011
CH Export
Million cups
Volume delivered from our plants
+3%
+7%
Key products:Emmi Caffè Latte breaks the 90-million-cup barrier
Positive development since product launchDefence within SwitzerlandInternational growth
Financial year 2011, Results Presentation, 29 March 2012 Page 36
* Growth in volume ** For Emmi, measured in terms of volume
Healthy growth across the board
Emmi Caffè Latte: Most important markets
Growth 2010 -> 2011* Size of market**
Switzerland + 7% No. 1
Germany - 21% No. 2 (de-listings due to price increases)
Austria + 11% No. 3
Spain + 76% No. 4
UK + 49% No. 5
Belgium + 47% No. 6
Defence within SwitzerlandInternational growth
Financial year 2011, Results Presentation, 29 March 2012 Page 37
80
90
100
110
120
130
140
150
160
2007 2008 2009 2010 2011
2007 2008 2009 2010 2011
Index
+6%
+19%
Key products:Strong growth in US specialities market: Cow's milk cheese
Local growth of Emmi Roth USA: Steady increase each year since takeover
+20%
+6%
International growth
Takeover took place in January 2009.
§ Double-digit growth in salesand single-digit growth in volume in 2011§ Local production reaches
limits of capacity
Financial year 2011, Results Presentation, 29 March 2012 Page 38
80
90
100
110
120
130
140
2008 2009 2010 2011Indexed sales
Index
+7%
+13%
Key products:Strong growth in US specialities market: Goat's milk cheese
Cypress Grove Chèvre: Leader position and growth above the market average
+17%
International growth
Takeover took place in August 2010.
§ Capacity set to increase massively in 2012 thanks to additional production infrastructure.
Financial year 2011, Results Presentation, 29 March 2012 Page 39
80
90
100
110
120
130
140
2009 2010 2011
Indexed yoghurt sales
Index
+16%
+7%
Key products:Re-positioning of Trentina bearing fruit
Sharpened brand positioning International growth
§ 2008: Launch of the brand Trentinalatte
§ 2011: Re-positioning with changeto "Trentina"
Das Bild kann zurzeit nicht angezeigt werden.
Achievements in 2011 Activities for 2012
Results 2011: Double-digit growth in volume and sales-> above market average-> 90% prompted brand awareness
Future potential: At least high single-digit growth
§ Intregration completed§ New marketing team set up§ Various promotion activities with trade§ New limited edition “Sicilian Lemon”
on sale since August
§ Removal of Dr. Oetker branding from all pots from August
§ TV sponsorship “Let’s do lunch” on ITV1 August / September
§ Sharpened brand positioning (Honest Tasty Pleasure)
§ New packaging by May
§ Extensive marketing campaign starting in June (Print, TV, social media)
§ New products: two limited editions,additional product range
§ Clear channel strategy
Successful acquisition:Onken in UK
No. 1 within branded big-pot yogurts in the UK
Acquisition as per 3. January 2011
International growth
Financial year 2011, Results Presentation, 29 March 2012 Page 40
Das Bild kann zurzeit nicht angezeigt werden.
Successful acquisition:Bontà Divina dessert specialties
A-27 SpA offers new business opportunities
Achievements in 2011 Activities for 2012§ Assessment synergies in Benelux & UK§ Re-definition of marketing mix§ Redesign of packaging§ Development of new products in the
top-range Bontà Divina Delizia§ Evaluation of synergies in further
markets
§ Financial integration into Emmi’s books§ Definition of synergy potential in
Emmi's key markets§ Merging of sales organizations
1st priority: Germany starting Jan 1, 2012§ Definition of investment case for
2012 and 2013
Results 2011: Single-digit growthPotential going forward: High single-digit growth
Acquisition as per 1. August 2011
International growth
Financial year 2011, Results Presentation, 29 March 2012 Page 41
Financial year 2011, Results Presentation, 29 March 2012 Page 42
§ "Operational excellence" initiatives at all major locations; focus on process optimization§ Replacement investments bring about increase in
efficiency§ Insourcing of logistics services for own company§ Abandonment of unprofitable services outside of
core business§ Cheap procurement of non-dairy raw materials in
the EU (through pooling and advantageous exchange rates)§ Concentration of marketing resources on brands
and markets with potential
Cost savings:Savings of CHF 15 million in 2011
HighlightsCost management
Financial year 2011, Results Presentation, 29 March 2012 Page 43
§ Plant and process optimization
§ Improvements in production planning
§ Reduction in number of malfunctions and down-time
§ Optimization of warehouse management
§ Increase in transport volumes per single journey
Cost management
Cost savings:Idea management, a mainstay of our efficiency drive
Emmi's "idea management" initiative has implemented 330 suggestions submitted by staff:
Employees have a key role to play
Placing the scales60 metres closer
to the production facilities =a saving of 4 minutes
If our tools are always on hand, we don't have to spend as much time looking for them
Welcome addressKonrad Graber, Chairman of the Board of Directors
Market situation and outlookUrs Riedener, CEO
Most important success factorsUrs Riedener, CEO
Annual results 2011Reto Conrad, CFO
Overview of financial year 2011Urs Riedener, CEO
Financial year 2011, Results Presentation, 29 March 2012 Page 45
International Switzerland
CHF millions
1133 1479
256
414 447
587
18261465 1583
444
509
0
500
1,000
1,500
2,000
2,500
2002 2003 2004 2005 2006 2007
1389
1879 1926 2027
23352501
2008
3,000
1914
2671 2619
626
2045
2009
675
1944
50%
50%
In 3-5 years
732
1952
2684
2010
Sales 2002 – 2011 and the medium-term goal
Steady growth with medium-term 50/50 ratio Switzerland and international
2721
811
19091910
2011
Financial year 2011, Results Presentation, 29 March 2012 Page 46
Investment: a prerequisite for further growth
Focus on creating extra productive capacity
SwitzerlandKaltbach: New facilities for producing goat's milk fresh cheese CHF 4.5 million
Saignelégier: Extra capacity for thecuring of Tête de Moine cheese CHF 8 million
InternationalUSA/Monroe: Extra capacity for cow's milk speciality cheese CHF 40 million*
USA/Arcata: Extra capacity for goat's milk cheese CHF 6 million
Italy: Doubling of productive capacity at A-27 CHF 15 million*
*Investment in 2012/2013
0
50
100
2007 2008 2009 2010 2011
Locally produced Exported from Switzerland
Financial year 2011, Results Presentation, 29 March 2012 Page 47
Major acquisitions
2006: Trentinalatteyoghurt, fresh cheese (Italy)
2009: Roth Käse (USA)
2010: Cypress Grove Chèvre (US)Fromalp, cheese (CH)
2011: Onken, yoghurt (Germany)A-27, desserts (Italy)Rutz Käse (CH)
76%
24%
67%
33%
53%
47%
64%
36%
75%
25%
Percent
Percentage shares of export business out of Switzerlandand business produced locally abroad 2007 – 2011
Higher increase in share of locally produced business
Financial year 2011, Results Presentation, 29 March 2012 Page 48
Stimulating
§ Acquisitions (Rutz)
§ Optimization and expansion of brand portfolio
§ Product innovation
§ Organic growth (Caffè Latte, Onken, Trentina, Roth and Cypress Grove Chèvre)
§ Growth through acquisitions(A-27, first half of year)
§ Stable consumer sentiment in USA, Germany and UK
Limiting§ Abandonment of unprofitable positions
(generic products, industry and logistics)§ Price pressure in retail § Import pressure, retail tourism
§ Cautious consumer sentiment inSouthern Europe
§ Abandonment of unprofitable positions(primarily processed cheese)
§ New approach to logisticsmanagement in Austria
Switzerland
International
Environment in Switzerland and internationally
Factors affecting sales
Figures assume constant exchange rates and raw milk prices, and a stable economy
Financial year 2011, Results Presentation, 29 March 2012 Page 49
§ Increase investments in brand concepts (Caffè Latte, Emmi Umbrella Brand)
§ Targeted innovation within existing brand concepts
§ Optimization of successful sponsoring (skiing, open-airs)
§ Operating expenses: further savings of at least CHF 5 million
Measures for Switzerland in 2012
Press ahead with successful brand concepts
Financial year 2011, Results Presentation, 29 March 2012 Page 50
Cheese§ Exploit market potential in the US§ Growth in fondue in Benelux§ Exploit positive development of Kaltbach cheese in
Germany
Caffè Latte§ Investment in Germany, the biggest foreign market of
Caffè Latte§ Expansion in Spain, Benelux and UK
Local brands§ Relaunch and strengthen the Onken brand in the UK § Boost A-27 sales in various markets
Evaluate opportunities in new markets
Measures for the international market in 2012
Continued targeted strengthening of key markets
Financial year 2011, Results Presentation, 29 March 2012 Page 51
Growth incl. acquisitions, profit
§ Group sales 2% to 3%
§ Sales Switzerland -2% to -1%
§ International sales 10% to 15%
§ EBIT, CHF 125 to 140 million
§ Net profit margin around 3%
(Figures assume constant exchange rates and raw milk prices; they include known acquisitions but exclude extraordinary factors)
Outlook for 2012 as a whole
2% to 3% Group growth, profit along the lines of the previous year
Financial year 2011, Results Presentation, 29 March 2012 Page 52
(Figures assume constant exchange rates and raw milk prices; organic)
Growth without acquisitions, profit
§ Group sales 2% to 3%
§ Sales Switzerland stable
§ International sales 6% to 8%
§ Net profit margin 2.5% to 3.5%
Medium-term objectives
2% to 3% organic growth per year at Group level
AppendixAdditional information
Financial year 2011, Results Presentation, 29 March 2012 Page 54
Direct suppliers and others
Central SwitzerlandMilk ProducersZMP
Milchverbandbeider Basel MIBA
Nordostmilch
30%
Milk suppliers in Switzerland in 2011
842 878 834 873 896
29 38 38 40 40
0
200
400
600
800
1000
2007 2008 2009 2010 2011
Milk Cream
Switzerlandin kg millions
Milk and cream processing by Emmi
Volume of milk and cream processed by Emmi in Switzerland
Emmi processes over 900 million kg
Image shaped through innovative brand concepts
The culture to support innovations
2003
Benecol
2005 2007
Minicol
Choco Latte
Swiss Müesli
Luzerner Yogodu
Kaltbach Le Gruyère
MC Neil Benecol Drink
Emmi Caffè Latte Lassi
2004 2006
Création Yoghurt
Kaltbach Raclette
SwissAlp Käse
Winzer
2008
Gala Mousse
Emminent
2009
Emmi Caffè Latte Zero
Energy Milk
Mozzarella
Luzerner Scheiben
Tigre
Yogi Drink
2010
KaltbachExtra
Emmi CaffèLatte Intenso
2011
Milk Shake
Mini Marinati
Yogurt Milk
Kaltbach Fondue
Fondue withoutalcohol
Financial year 2011, Results Presentation, 29 March 2012 Page 55
Possible routes for acquisitions
Brand Jewel
Stra
tegi
c/In
tern
atio
nal
Tact
ical
/Sw
iss
Possible
CH
F1’
000
mio
. C
HF
50 M
io.
TechnologyLeader / Added
Value PL
no
Possible
Market Synergies/Efficiency
Rutz Käse
Roth Cheese/Fromalp
Organic
Biedermann
Possible
Regional /competion of product range
Molkerei Basel
Onken
Bontà Divina
CypressGrove
Focus on existing Emmi international key markets
Financial year 2011, Results Presentation, 29 March 2012 Page 56
Milk price developments in Switzerland and the EU [Price/kg milk]
25
30
35
40
45
50
55
60
65
70
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov DecSources: Federal Office for Agriculture (FOAG), EU, SNB
EU 2011: Ø 43.4 centimes EU 2010: Ø 43.5 centimes
CH 2010: Ø 61.8 centimes CH 2011: Ø 62.7 centimes
EU 2011: Ø 34.7 eurocents EU 2010: Ø 30.8 eurocents
Milk-price developments in 2011
Difference CH – EU has expanded due to currency situation
Financial year 2011, Results Presentation, 29 March 2012 Page 57
Dairy products26.9%
(CHF 733 million)
Other products/services5.8%
(CHF 158 million)
Powder/concentrates3.3%
(CHF 89 million) Cheese34.0%
(CHF 925 million)Fresh cheese
6.4%(CHF 175 million)
Fresh products23.6%
(CHF 641 million)
Total net sales 2011: CHF 2,721 million
Product groups (net sales 2011)
Broad-based product portfolio
Financial year 2011, Results Presentation, 29 March 2012 Page 58
Financial year 2011, Results Presentation, 29 March 2012 Page 59
Reinforcing our brand concepts
Emmi house of brands
One Word EquityEmmi
Product brands
One Word EquityBrands
Emmi positionStatement Real Swiss
premium delight
Original Well-beingInspirationRefinement
TasteCH & local
jewelsDesserts*
* Bontà Divina desserts are produced in Italy by A-27 S.p.A.
Financial year 2011, Results Presentation, 29 March 2012 Page 60
International base
60
Expansion through subsidiaries and cooperations
Canada
France SwitzerlandSpain
UK
Germany
Austria
Benelux
43% Kaiku
ItalyRovere della Luna
USA, Monroe, WIEmmi Roth Inc.
Penn Yan, NYCASP
USA, Arcata, CACypress Grove Ch.
ItalyRancio Valcuvia
Financial year 2011, Results Presentation, 29 March 2012 Page 61
Key production sites in Switzerland
Sustainable improvement in productivity and efficiency
Emmen Kirchberg (Berne)
Landquart Ostermundigen
Langnau
Dagmersellen
Kirchberg
Suhr Kaltbach
Page 62
1. HY 2. HY
ø 1.HY2011
ø 1.HY2010
ø 2.HY2010- 17,63 centimes- 16.28 %
ø 2.HY2011
- 13,55 centimes- 13.50 %
Quelle: OANDA
Development of US Dollar
Forex situation extremely challenging in 2011
Financial year 2011, Results Presentation, 29 March 2012
Page 63
1. HY 2. HY
ø 1.HY2011
ø 1.HY2010
ø 2.HY2010- 16,85 centimes- 11.71 %
ø 2.HY2011
- 13,22 centimes- 9.95 %
Quelle: OANDA
Development of Euro
Forex situation extremely challenging in 2011
Financial year 2011, Results Presentation, 29 March 2012
Financial year 2011, Results Presentation, 29 March 2012 Page 64
2005 2007
Dagmersellen production facility:Switchover of various systems from heating oil to natural gas / biogas
Dagmersellen production facility: Use of lukewarm water to cool air compressors => reduction in the consumption of groundwater
Landquart production facility: Milk cream now cooled using cold milk
2006 2010
Logistics: ongoing adapt. of delivery schedules and modernisation of vehicle fleetsStart of cooperation with the "Abfallbörse„(waste exchange project)
Berne production facility: Heat generation from waste water
Molkerei Biedermann: Solar power thanks to photovoltaic facility
Emmen production facility: Newwoodchip-fired steam plant
2009
Landquart production facility: heat recovery using compressed air
Berne production facility: heat recovery from waste gas, Energieverbund Mösli
2008
Fromco Moudon:Heat generation using newcool air compressors
Emmen production facility: Heat generation using ventilation energy
Sustainability is part of our company policy
Key environmental measures 2005 to 2011
2011
LESA Bever: Solar energy facility for process water
Ongoing energy optimization initiatives at our six biggest locations
86% of our heavy-load trucks have the lowest level of emmissions (EURO 5)
Financial year 2011, Results Presentation, 29 March 2012 Page 65
WaterWaste to incineration plantElectricity
Dotted line = product sales as a benchmark
Current sustainability report from Emmi
Environmental index Emmi Group 2008 - 2011
Above-average decline in emissionsIndex
2008 2009 2010 2011
100
90
80
88.0
89.9 92.3
96.997.1
94.8
98.698.9100.5
93.8
76.7
95.9