Handelsbanken conference Jan Johansson, President and CEO
SCA Group Leading global hygiene and forest products company
Sales of SEK 99bn* 44,000 employees Sales in about 100 countries #1 or #2 positions in about 90 countries Strong brands; TENA and Tork are leading global brands for incontinence products and AfH tissue
China’s third largest tissue company Europe’s largest private forest owner Several of the world’s most prestigious sustainability awards
* Sales number based on SCA’s 2013 sales according to new and amended reporting standards and including Vinda’s 2013 sales. September 8, 2014
Handelsbanken Large Cap Conference
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Transformation of SCA Divested the Packaging business, excluding two kraftliner mills Acquired Georgia-Pacific’s European tissue operations Majority shareholder in the Chinese tissue company Vinda Strengthened positions in emerging markets Acquisition of Everbeauty in Asia Acquisition of PISA in Chile Investment in India Floated joint venture in Australia, New Zealand and Fiji Divested the Aylesford Newsprint and Laakirchen publication paper mills Efficiency programs
September 8, 2014
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SCA and Vinda to integrate hygiene business in China SCA to transfer its hygiene business in China (Mainland China, Hong Kong and Macau) to Vinda Exclusive license for Vinda to market and sell SCA brands; TENA, Tork, Tempo, Libero and Libresse in China Vinda to acquire SCA’s Dr P and Sealer brands in China Benefits in distribution, sales, innovation and R&D Vinda gets access to a broader product portfolio and SCA brands, reaching broader consumer and customer base SCA’s hygiene business in China had net sales of approx. SEK 600m in 2013 Purchase consideration amounts to approx. SEK 1,000m Subject to approval by the shareholders of Vinda
September 8, 2014
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Leading Market Positions Globally and Regionally North America Incontinence products: AfH tissue:
Nordic region 3 3
Mexico
Incontinence products:
1
Europe
Baby diapers:
1
Tissue:
1
AfH tissue:
1
Incontinence products:
1
Consumer tissue:
2
Baby diapers:
2
Feminine care:
2
Feminine care:
3
Incontinence products:
1
Feminine care:
1
Private forest owners:
1
Tissue:
2
Solid-wood products:
2
Baby diapers:
3 China
Colombia
Globally
Incontinence products:
1
Feminine care:
1
Tissue:
1
Baby diapers:
2
September 8, 2014
Incontinence products:
2
Tissue:
3
Baby diapers:
5
Incontinence products:
1
Asia (ex Japan)
AfH tissue:
1
Incontinence products:
Consumer tissue:
2
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SCA Group 2013 Sales and Operating Profit by Business Area Sales
Personal Care
Forest Products Operating Profit Operating Profit
16%
32%
17% 32%
Tissue
51% Operating Profit
52%
September 8, 2014
Handelsbanken Large Cap Conference
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SCA Group 2013 Sales by Product Segment Tissue
Personal Care Feminine care
Incontinence products
17% AfH tissue
31%
52%
38% 62%
Baby diapers 75% branded
Consumer tissue 54% branded
September 8, 2014
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Innovations and Product Launches Q2 2014 TENA Lady / Lady Pants
Global relaunch of TENA Lady and Lady pants Feminine designed Lady pants allowing consumers to choose from a family of TENA Lady range fitted for the needed occasion – discrete & secure September 8, 2014
Libresse Multistyle Liners /
CurveFitTM
New Libresse Multistyle, the most absorbent liners designed to fit any style of knickers Curvefit liners, uniquely shaped to perfectly fit body shape for maximum comfort Handelsbanken Large Cap Conference
Libero Comfort / Up&Go
Comfort: Elastics smoother and softer around the legs, improved fit with better comfort
Up&Go: Improved fit adjusts to baby’s unique body, softly following in every move. High absorption capacity to secure optimal leakage protection 8
Innovations and Product Launches Q2 2014
IT-based washroom service Provides easily accessible realtime data on toilet use Facilitates cleaning, control odors and reduce water usage September 8, 2014
Tork Sanitizing Wet Wipe
Tork - EasyCubeTM
Tork - Bloe
IT-based washroom service
Provides easily accessible realtime data on refill consumption
Wet wipes for cleaning and sanitizing restaurant tables Discreet and portable solution
Gives instant overview of when and where cleaning is needed Handelsbanken Large Cap Conference
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Market Drivers Good growth opportunities
Global population growth An aging population Increased market penetration Higher disposable income Customers and consumers demand more comfort and sustainability
September 8, 2014
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Usage of Hygiene Products High potential in markets with low penetration
Incontinence Products
700
Baby Diapers
Feminine Care
2 000
25
400
600 1 500 400
20
300
500
15 1 000
200
300 200
10 500
100
5
100 0 0 Units/person with incontinence/year Units/child up to 2.5 years/year
North America
September 8, 2014
Tissue
Western Europe
0
0 Units/woman 15-49 years/year
Eastern Europe
Handelsbanken Large Cap Conference
Latin America
Kg/capita/year
Asia
11
Emerging Markets Q2 2014 Sales
Group
Personal Care
Emerging markets
Tissue
Emerging markets
29%
31%
Emerging markets
43% 57% Mature markets
69%
Organic Sales Growth in Emerging Markets:
Mature markets
9%*
Mature markets
9%*
71%
8%*
* Q2 2014 compared with Q2 2013 September 8, 2014
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Aging Population Total population over 60 years exceeding 1bn by 2020 Millions aged over 60 years old
1 200 +25% 1 000 800 600 400 +30%
+13%
200
+22% 0 Total world
Europe
China
2013
September 8, 2014
USA
2020
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Incontinence Products Prevalence of incontinence % of world’s population affected by incontinence, 2013
20%
15%
10%
5%
0% 0-19 years
20-29 years
30-64 years
65+ years
Incontinence affects 4-8% of the world’s population, approximately 400 million people globally affected by incontinence Source: Data included in the graph has been obtained from the International Consultation on Incontinence 2013 September 8, 2014
Handelsbanken Large Cap Conference
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Incontinence Products Grow penetration in key segments European Market Penetration %
Increase market value by upgrading to new modern concepts, e.g. pants
80 70
Increase usage and value by influencing reimbursement models
60 50
Recruit new users through innovation and communication
40 30 20 10 Average market
September 8, 2014
Pants
Light Inco Female
Light Inco Male
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Incontinence Products Expand the category Build on core competence to expand beyond absorbent products
Service Diagnostics
Skin care
Absorbent S incontinence products
Patient hygiene
Expand core competence into the service area to create new revenue streams
Diagnostics Training
September 8, 2014
Handelsbanken Large Cap Conference
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Group Q2 2014 vs. Q2 2013
Sales
Organic Sales Growth
Operating Profit*
SEK 25,829m +12%
+3%
SEK 2,934m +29%
Operating Margin*
EPS
Operating Cash Flow
11.4% +150 bp
SEK 2.54 +56%
SEK 2,060m +28%
* Excluding items affecting comparability and including gains on forest swaps of SEK 175m (0) before tax September 8, 2014
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Q&A
September 8, 2014
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