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2016 Deutsche Bank Global Consumer Conference 14 June 2016 Gabriel Bennet, CFO Nathalie Redmo, IR Manager ORIFLAME HOLDING AG

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Page 1: ORIFLAME HOLDING AGinvestors.oriflame.com/sites/default/files/2019-04/Oriflame _deutsche... · ORIFLAME HOLDING AG ... MARKETING + ONLINE ORDERING + BUSINESS TOOLS 2010s 1988 2008

2016 Deutsche Bank Global Consumer Conference

14 June 2016

Gabriel Bennet, CFO

Nathalie Redmo, IR Manager

ORIFLAME HOLDING AG

Page 2: ORIFLAME HOLDING AGinvestors.oriflame.com/sites/default/files/2019-04/Oriflame _deutsche... · ORIFLAME HOLDING AG ... MARKETING + ONLINE ORDERING + BUSINESS TOOLS 2010s 1988 2008

• Beauty company selling direct

• Around 3 million beauty consultants

• €1.2 billion in sales annually

• 95% of orders online

• 1,000 cosmetic products, of which 1/3 are new

each year

• New catalogues every third week adopted to

the local market

• Manufacturing in Poland, Russia, China &

India

• Around 6,500 full-time equivalent employees

• Listed on Stockholm Nasdaq exchange and

domiciled in Switzerland

• Co-founder of the World Childhood

Foundation

6/13/2016 2Copyright ©2016 by Oriflame Cosmetics AG

ORIFLAME IN BRIEF

Page 3: ORIFLAME HOLDING AGinvestors.oriflame.com/sites/default/files/2019-04/Oriflame _deutsche... · ORIFLAME HOLDING AG ... MARKETING + ONLINE ORDERING + BUSINESS TOOLS 2010s 1988 2008

Q1 HIGHLIGHTS

6/13/2016 Copyright ©2016 by Oriflame Cosmetics AG 3

€m

0%

5%

10%

15%

0

200

400

600

800

1000

1200

1400

Q1 14 Q2 14 Q3 14 Q4 14 Q1 15 Q2 15 Q3 15 Q4 15 Q1 16

Net Sales LTM Adj. Op Margin % LTM

• Sales 10% in local currency, -1% in €

• Active consultants -9%

- Lc productivity +19%

• Price/mix +16%

- Unit decline -6%

• Operating margin 6.9% (5.6%)

- Currency impact -370 bps

- Net profit €10.7m (€11.2m)

• Q2 update: 13% YTD and 17% QTD lc sales

Q1’16 Q1’15 Change LTM'16 YE‘15

Sales, €m 305.8 307.8 (1%) 1,209.6 1,211.6

Lc sales - - 10% - -

Adj. Operating profit, €m

21.1 17.2 23% 104.1 100.2

Adj. operating margin

6.9% 5.6% - 8.6% 8.3%

Active Consultants ‘000

3,105 3,429 (9%) 3,105 3,246

Page 4: ORIFLAME HOLDING AGinvestors.oriflame.com/sites/default/files/2019-04/Oriflame _deutsche... · ORIFLAME HOLDING AG ... MARKETING + ONLINE ORDERING + BUSINESS TOOLS 2010s 1988 2008

CASH FLOW AND NET DEBT

6/13/2016 Copyright ©2016 by Oriflame Cosmetics AG 4

0

25

50

75

100

125

Q1 14 Q2 14 Q3 14 Q4 14 Q1 15 Q2 15 Q3 15 Q4 15 Q1 16

Operating cash flow LTM Capex LTM€m

0.0

0.5

1.0

1.5

2.0

2.5

0

50

100

150

200

250

300

350

Q1 14 Q2 14 Q3 14 Q4 14 Q1 15 Q2 15 Q3 15 Q4 15 Q1 16

Net Debt at hedged values* Net Debt at hedged values* / EBITDA LTM€m

Page 5: ORIFLAME HOLDING AGinvestors.oriflame.com/sites/default/files/2019-04/Oriflame _deutsche... · ORIFLAME HOLDING AG ... MARKETING + ONLINE ORDERING + BUSINESS TOOLS 2010s 1988 2008

THE ORIFLAME BRAND

– OUR SWEDISH ATTRIBUTES

Copyright ©2016 by Oriflame Cosmetics AG 5

ACCESSIBLE NATURAL

PROGRESSIVE TRUSTWORTHY

6/13/2016

Page 6: ORIFLAME HOLDING AGinvestors.oriflame.com/sites/default/files/2019-04/Oriflame _deutsche... · ORIFLAME HOLDING AG ... MARKETING + ONLINE ORDERING + BUSINESS TOOLS 2010s 1988 2008

SUSTAINABILITY

6/13/2016 Copyright ©2016 by Oriflame Cosmetics AG 6

PRODUCTS PLANETPEOPLE

• Consultant bonus and recognition

payout of more than €320M in 2015

• More than € 1.1M donated to Oriflame

foundation

• 87% of employees recommend

Oriflame as a good place to work

• More than 40 markets participating in

Charity activities

Creating opportunities to improve

people’s lives

• First in the world RSPO segregated

certified product

• Green palm credits covering 100% of palm

oil consumption

• 85% of the product cartons & leaflets FSC

certified

• Only natural origin exfoliants in new

developments (replacing microbeads)

Bringing beauty & wellbeing

through responsible products

• LEED® certification of factories in Russia

and India

• 98% of catalogue paper credibly certified

in 2015 (50% in 2011)

• Scored 99B on CDP Climate change

evaluation in 2015

Driving environmental

sustainability

Page 7: ORIFLAME HOLDING AGinvestors.oriflame.com/sites/default/files/2019-04/Oriflame _deutsche... · ORIFLAME HOLDING AG ... MARKETING + ONLINE ORDERING + BUSINESS TOOLS 2010s 1988 2008

+

• ~ 50% produced in house

• Insource more volumes

• Technology expansion

• Establish commercial relationships

NEW OPPORTUNITIES IN GLOBAL MANUFACTURING

6/13/2016 7Copyright ©2016 by Oriflame Cosmetics AG

Page 8: ORIFLAME HOLDING AGinvestors.oriflame.com/sites/default/files/2019-04/Oriflame _deutsche... · ORIFLAME HOLDING AG ... MARKETING + ONLINE ORDERING + BUSINESS TOOLS 2010s 1988 2008

GEOGRAPHIC FOOTPRINT 2010

6/13/2016 Copyright ©2016 by Oriflame Cosmetics AG 8

2010 YTD Split

SALES ACTIVE CONSULTANTS OPERATING PROFIT

CIS &

Baltics

Other

markets

57%

(56%)

43%

(44%)

60%

(59%)

40%

(41%)

70%

(61%)

30%

(39%)

Page 9: ORIFLAME HOLDING AGinvestors.oriflame.com/sites/default/files/2019-04/Oriflame _deutsche... · ORIFLAME HOLDING AG ... MARKETING + ONLINE ORDERING + BUSINESS TOOLS 2010s 1988 2008

Asia &Turkey

Europe & Africa

Latin America

CIS

Q1 Regional Split

GEOGRAPHIC FOOTPRINT TODAY

6/13/2016 Copyright ©2016 by Oriflame Cosmetics AG 9

SALES ACTIVE CONSULTANTS OPERATING PROFIT

8% (7%)

25% (23%)

36% (45%)

31% (25%)

10% (10%)

27% (27%)

29% (36%)

34% (27%)

7% (5%)

32% (34%)

20% (36%)

41% (25%)

Page 10: ORIFLAME HOLDING AGinvestors.oriflame.com/sites/default/files/2019-04/Oriflame _deutsche... · ORIFLAME HOLDING AG ... MARKETING + ONLINE ORDERING + BUSINESS TOOLS 2010s 1988 2008

6/13/2016 10

STRATEGIC FOCUS AREAS

Copyright ©2016 by Oriflame Cosmetics AG

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STRATEGIC FOCUS AREAS

6/13/2016 Copyright ©2016 by Oriflame Cosmetics AG 11

4 DIGITALIZATION OF

THE BUSINESS MODEL

STRENGTHENING THE

BUSINESS OPPORTUNITY21 FOCUS ON

PRODUCT CULTURE

3 CUSTOMER EXPERIENCE

WITH A HUMAN TOUCH

Page 12: ORIFLAME HOLDING AGinvestors.oriflame.com/sites/default/files/2019-04/Oriflame _deutsche... · ORIFLAME HOLDING AG ... MARKETING + ONLINE ORDERING + BUSINESS TOOLS 2010s 1988 2008

23%

20% 25%

17%

7%8%

Colour Cosmetics

Fragrances

Skin Care

Personal & Hair Care

Wellness

Accessories

6/13/2016 12

Sales by Category 2015

1. FOCUS ON PRODUCT CULTURE

2. STRENGTHENING THE BUSINESS OPPORTUNITY

3. CUSTOMER EXPERIENCE WITH A HUMAN TOUCH

4. DIGITALIZATION OF THE BUSINESS MODEL

Copyright ©2016 by Oriflame Cosmetics AG

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13

• Product portfolio reinforcing the Oriflame brand

• Strengthening the product culture – driven by the

Oriflame routines

• Skin Care and Wellness

• Better sales mix and price increases – increased

gross margin

• Continuing to offer a wide assortment and driving the

activity in the sales force

Copyright ©2016 by Oriflame Cosmetics AG6/13/2016

1. FOCUS ON PRODUCT CULTURE

2. STRENGTHENING THE BUSINESS OPPORTUNITY

3. CUSTOMER EXPERIENCE WITH A HUMAN TOUCH

4. DIGITALIZATION OF THE BUSINESS MODEL

Page 14: ORIFLAME HOLDING AGinvestors.oriflame.com/sites/default/files/2019-04/Oriflame _deutsche... · ORIFLAME HOLDING AG ... MARKETING + ONLINE ORDERING + BUSINESS TOOLS 2010s 1988 2008

BUSINESS

OPPORTUNITY

OFFER

6/13/2016 14

• Improved earnings opportunity

• Increased sales of routines

• Secure earnings for Sellers & Leaders through

the Success Plan

• Locally attractive opportunity communication

• Personal and professional development

• Belonging to the global Oriflame community and

recognition

• Conferences and events

Copyright ©2016 by Oriflame Cosmetics AG

1. FOCUS ON PRODUCT CULTURE

2. STRENGTHENING THE BUSINESS OPPORTUNITY

3. CUSTOMER EXPERIENCE WITH A HUMAN TOUCH

4. DIGITALIZATION OF THE BUSINESS MODEL

Page 15: ORIFLAME HOLDING AGinvestors.oriflame.com/sites/default/files/2019-04/Oriflame _deutsche... · ORIFLAME HOLDING AG ... MARKETING + ONLINE ORDERING + BUSINESS TOOLS 2010s 1988 2008

RECOMMENDATION

15

NPS – Satisfied consultants and consumers will recommend us to others

6/13/2016 Copyright ©2016 by Oriflame Cosmetics AG

1. FOCUS ON PRODUCT CULTURE

2. STRENGTHENING THE BUSINESS OPPORTUNITY

3. CUSTOMER EXPERIENCE WITH A HUMAN TOUCH

4. DIGITALIZATION OF THE BUSINESS MODEL

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6/13/2016 Copyright ©2016 by Oriflame Cosmetics AG 16

+ ONLINE SELLING

& RECRUITING

Offline orders Online orders

1968 1998 2008 2015

1960s -1970s 1980s 1990s 2000s

HOME PARTIES + PERSON TO

PERSON SELLING

+ NETWORK

MARKETING

+ ONLINE ORDERING

+ BUSINESS TOOLS

2010s

1988

2008

2015

0 Facebook fans

>7 million Facebook fans

38% of all orders online

95% of all orders online

1.5 billion page views

3.3 billion page views

21 million visitors

60 million visitors

45 million site visits

175 million site visits

1. FOCUS ON PRODUCT CULTURE

2. STRENGTHENING THE BUSINESS OPPORTUNITY

3. CUSTOMER EXPERIENCE WITH A HUMAN TOUCH

4. DIGITALIZATION OF THE BUSINESS MODEL

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6/13/2016 Copyright ©2016 by Oriflame Cosmetics AG 17

Nadia MeutiaGold Executive Director (Indonesia)

1. FOCUS ON PRODUCT CULTURE

2. STRENGTHENING THE BUSINESS OPPORTUNITY

3. CUSTOMER EXPERIENCE WITH A HUMAN TOUCH

4. DIGITALIZATION OF THE BUSINESS MODEL

Page 18: ORIFLAME HOLDING AGinvestors.oriflame.com/sites/default/files/2019-04/Oriflame _deutsche... · ORIFLAME HOLDING AG ... MARKETING + ONLINE ORDERING + BUSINESS TOOLS 2010s 1988 2008

18

GOING FORWARD

6/13/2016 Copyright ©2016 by Oriflame Cosmetics AG

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6/13/2016 19

A COMPANY IN TRANSFORMATION

Copyright ©2016 by Oriflame Cosmetics AG

Where we are heading

• Brand and value driven organization with a human

touch

• Improved business opportunity

• Social selling business model with online as

catalyst

• Larger focus on Skin Care and Wellness routines

• Increased sales and operating profit from key

growth regions

Page 20: ORIFLAME HOLDING AGinvestors.oriflame.com/sites/default/files/2019-04/Oriflame _deutsche... · ORIFLAME HOLDING AG ... MARKETING + ONLINE ORDERING + BUSINESS TOOLS 2010s 1988 2008

6/13/2016 Copyright ©2016 by Oriflame Cosmetics AG 20

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6/13/2016 21

CAUTIONARY STATEMENT

Some statements herein are forward-looking and the actual outcome could be materially different.

In addition to the factors explicitly commented upon, the actual outcome could be materially affected by other factors like,

for example, the effect of economic conditions, exchange-rate and interest-rate movements, political risks,

impact of competing products and their pricing, product development, commercialisation and supply disturbances.

Copyright ©2016 by Oriflame Cosmetics AG