SCA Capital Market Day 2012 presentation

SCA Capital Market Day 2012 presentation

SCA Capital Market Day 2012
Jan Johansson, President and CEO
Macro Economy
China’s economic slowdown…
Holding back recovery
European debt crisis
To be, or not to be…
Germans sick of paying
U.S. election
Effects of high unemployment
The Arabic spring
2
CMD 2012
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
3
CMD 2012
Global Hygiene Products Market
Increased penetration and aging and growing population
Personal Care
Tissue
2010
4
2017
CMD 2012
Aging Population
Total population aged over 60 approaching 1 billion by 2017
Millions aged over 60 years old
1 200
1 000
+25%
800
2010
600
2017
400
+12%
200
+34%
+21%
0
Total world
5
Europe
China
USA
CMD 2012
Hygiene Products
High potential in markets with low penetration
Usage of Hygiene products
Units/capita/year
North America
6
Units/child/year
Western Europe
Units/woman/year
Eastern Europe
Kg/capita/year
Latin America
Asia
CMD 2012
Today
SCA is a leading global
Hygiene and Forest products
company
7
CMD 2012
SCA Group
 Net sales of SEK 91bn*
 37,000 employees
 Sales in more than 100 countries
 World’s second-largest hygiene company
 #1 or #2 positions in close to 80 countries
 Strong brands;
TEN and Tork are leading global billion-euro
brands for Incontinence care and AFH tissue
 Europe’s largest private forest owner
 Europe’s second-largest sawmill company
 Several of the world’s most prestigious
sustainability awards
* 2011 sales adjusted for closed transactions
8
CMD 2012
Transforming SCA
 Divestment of the Packaging business, excluding the two kraftliner mills
 Acquisition of Georgia-Pacific’s European tissue operations
 Acquisitions in emerging markets
 Everbeauty in Asia
 Pro Descart in Brazil
 San Saglik and Komili(50%) in Turkey
 Joint venture in Australia/New Zealand
 Divestment of Aylesford Newsprint
 Efficiency program
 Leadership and culture
9
CMD 2012
SCA Group
Hygiene business is growing
% of net sales
~20%*
54%
40%
46%
60%
Forest Products and
Packaging
10
~80%*
Hygiene products
(Personal Care and Tissue)
CMD 2012
SCA Group
9 months 2012 sales and EBIT by Business Area
Sales by Business Area
Forest Products
Personal Care
EBIT by Business Area
Personal Care
Forest Products
16%
22%
35%
30%
48%
Tissue
11
49%
Tissue
CMD 2012
SCA Group
Sales by Product Category
Tissue
Personal Care
Feminine care
15%
31%
Incontinence products
54%
AFH tissue
38%
62%
Baby diapers
73% branded
Consumer tissue
52% branded
12
CMD 2012
Growth
High growth in Emerging markets
Q3 2012
Emerging markets sales growth:
Personal Care: +26%*
Tissue: +20%*
% of Personal Care sales**
% of Tissue sales**
Emerging markets
16%
37%
Mature markets
* Adjusted for exchange rate movements
** Q3 2012
13
Emerging markets
Mature markets
CMD 2012
Leading Market positions
Globally and regionally
Value market positions
North America
Incontinence products:
AFH tissue:
Nordic region
2
3
Mexico
Incontinence products:
1
Europe
Baby diapers:
1
Tissue:
1
AFH tissue:
1
Incontinence products
1
Consumer tissue:
2
Baby diapers:
3
Feminine care
2
Feminine care
3
Incontinence products:
1
Feminine care:
1
Private forest owners:
1
Consumer tissue
2
Solid-wood products:
2
AFH tissue:
3
Baby diapers:
3
Asia
Incontinence products:
Colombia
Globally
Incontinence products:
1
Feminine care:
1
Tissue:
1
Baby diapers
2
14
1
Incontinence products:
1
AFH tissue:
1
Consumer tissue:
2
CMD 2012
SCA Group’s Priorities
EFFICIENCY
INNOVATION
GROWTH
SUSTAINABILITY
15
CMD 2012
Sustainability
People
•
•
•
•
Nature
Health & Safety
Hygiene solutions
Sustainable innovations
Code of Conduct
• Climate & Energy
• Water
• Fiber sourcing &
Biodiversity
Financials
• Return on capital
employed
• Growth
• Capital structure
16
CMD 2012
Efficiency
 Restructuring program in baby diapers
in Europe completed
 2011 Efficiency program
 Annual cost saving: EUR 80m
 Higher machine efficiency and reduced CAPEX
 Cost and productivity program
 Annual cost saving: EUR 300m
 Georgia-Pacific synergies
 Annual cost saving: EUR 125m
 Energy efficiency program
 Annual cost saving: EUR 70m
 Efficiency improvements in Forest Products
 Investments in upgrades and new capacity
17
CMD 2012
Innovation drives Profitable growth
Strengthens market positions and profitability
 Meet changing demands and requirements
 Create long-term, profitable differentiation
 Strengthen market positions
 Build stronger brands
 Drive growth
18
CMD 2012
SCA’s Market Priority
Mature markets
 Improve profitability
 Increased cash flow
generation
 Strengthen market
positions
Established
emerging markets
Not-present
emerging markets
 Profitable growth
 Selected entry
 Strengthen market
positions
 Category expansion
 Category expansion
19
CMD 2012
Financial Targets
Group
ROCE**
13%
Debt/Equity
0.70
Debt payment capacity
Dividend policy
above 35%
1/3 of cash flow from current operations
Business areas
Sales growth*
ROCE**
Personal Care
5-7%
30%
Tissue
3-4%
15%
in line with market
in top quartile
Forest Products
* Annual organic sales growth
** Return on capital employed
20
CMD 2012
Summary
 Transformation
 Leading brands and market positions
 Strong product portfolio and innovations
 Good growth opportunities
 Substantial efficiency improvements
 Profitability improvement
EFFICIENCY
INNOVATION
GROWTH
SUSTAINABILITY
21
CMD 2012
Hygiene Operations
Mats Berencreutz, Executive Vice President
22
CMD 2012
Strong Brands and Market positions
 Strong brands
and
leading global billion-euro brands
 #1 or #2 positions in close to 80 countries
23
CMD 2012
Hygiene Aspiration
 To own and develop 6-10 global brand
positionings of > EUR 1bn each
 Strengthen our profitability in core markets
 Increase share of revenues and profit from
D&E markets
 Increase share of revenues and profit from
less capital intensive opportunities
 Increase share of branded business vs.
retailer brands
 Increase share of No. 1 or No. 2 positions in
our branded business portfolio
24
CMD 2012
Category Priorities
Incontinence
care
Away From
Home
Consumer
tissue
Baby
Feminine
Innovation and Cost leadership
Leverage our Brands and broaden Offer
Growth D&E markets
 Lead & shape
 Go to market
 Products and
valued services
 Products and
valued services
 Growth
25
 Growth
 Penetration
mature markets
 Leverage
synergies globally
 Early entrance
new markets
 Early entrance
new markets
 Secure
profitability
 Selective D&E
market
 Cost effective
to be on par
with market
leader
 Speed to
market
 Drive scale
 Excellence in
brand
management
 Competitive offer
premium and
value
CMD 2012
Priorities
Core
capabilities
• Innovation &
Marketing
Organization
effectiveness
Cost savings
• Faster, simplified • Leaner, more agile
decision making organization
• S&M execution
• Clarified ways of • Shift resources where
required to win
• Global, integrated working
supply
• Best-in-class
support
Drive Growth
26
Drive Efficiencies
CMD 2012
Cost and Productivity program*
Key actions
 Manufacturing
 Blueprint implementation
 Asset utilization improvements
 Best practice sharing
Cost savings
SG&A
 Sourcing
 World-class sourcing processes
 Leverage global scale
 Consolidation of suppliers
Logistics
12%
6%
Manufacturing
43%
 Logistics
 Optimize warehouse footprint
 Lower transportation costs
 Working capital management
39%
Sourcing
 SG&A
 Fewer layers in the organization
 Clear roles and responsibilities, no overlaps
 Center-led support model
Total annual cost savings:
Related restructuring costs:
Headcount reduction:
EUR 300m
EUR 100m
approx. 1,500
* Excluding Georgia-Pacific acquisition
27
CMD 2012
Cost and Productivity program
Substantial cost savings
Estimates of Year-end run rate savings
EURm
350
300
300
250
200
200
150
100
50
0
2013
28
2014
CMD 2012
Georgia-Pacific Acquisition
Strengthens SCA’s No. 1 position in Tissue in Europe
29
Consumer tissue
Away From Home
No. 1
No. 1
30% market share
31% market share
CMD 2012
Georgia-Pacific Acquisition
Strengthens our no.1 position
 Perfect strategic fit
 Substantial synergies
 Strengthens our geographic presence in Europe
 Strong innovation portfolio
 Strengthens our branded portfolio
30
CMD 2012
Georgia-Pacific Acquisition
Synergies
Supply chain synergies
Cost
Cost synergies
synergies
 Manufacturing excellence and best
practice
 Footprint optimization
Support and
overhead
 Scale effects raw materials
25%
 Logistics optimization
Sales and Marketing
 S&M organization consolidation
60%
Sales and
Marketing
Supply chain
15%
 A&P efficiency
Support and overhead
 Consolidation of support functions
Total annual cost synergies: EUR 125m
Related restructuring costs: EUR 130m
31
CMD 2012
Georgia-Pacific Acquisition
Synergies
Estimates of Year-end run rate cost savings
EURm
150
125
100
90
50
50
0
2013
32
2014
2015
CMD 2012
Summary
Cost and Productivity program and Georgia-Pacific synergies
Estimates of Year-end run rate cost savings
EURm
450
425
390
400
350
300
250
250
200
150
100
50
0
2013
33
2014
2015
CMD 2012
Summary
 Strong brands and market positions
 Substantial savings from cost and productivity program
 Georgia-Pacific acquisition strengthens our position and
will generate substantial cost synergies
EFFICIENCY
INNOVATION
GROWTH
SUSTAINABILITY
34
CMD 2012
SCA Global Hygiene Supply
William Ledger, President
SCA World class Production facilities
Tissue
86 factories for hygiene products worldwide, incl. JV
Personal Care
36
CMD 2012
SCA’s Hygiene Business
Supply cost is a large part of turnover
Raw Material/
Other Cons.
Gross
profit
Cost of Goods
Others
Savings
Energy
Distr. Costs
Depreciation
Personnel costs
37
CMD 2012
Gearing up to Capture Savings
Energy
savings
We have programs to
address all cost
components
Energy
Logistics
Hygiene
Sourcing
Waste
reduction
Distr.
Costs
Raw Mat/
Others Cons.
Personnel
costs
Blue Print
Best practice
sharing
Depreciation
Others
38
CMD 2012
Global Best Practice Sharing
drives Performance
39
CMD 2012
Sourcing Savings
Renewed strong Global sourcing capabilities
700 initiatives identified and pursued
Georgia-Pacific Sourcing integration
Controlled by a program office
40
CMD 2012
Logistics Savings
Global Strategy
Reduce operating cost
Cost
down
Transport
optimization
Transport
sourcing
Warehouse
footprint
Free-up liquidity
Capital
turnover
up
Stock
reduction
Improve customer service
Sales
up
41
Value Added
Services &
with logistics
as
differentiator
CMD 2012
Driving Growth
 Organic
 New Paper Machine
in Germany (Kostheim)
 Extension of Tissue
Production in Russia (Sovetsk)
 M&A
 Acquisitions integration, e.g.
Georgia-Pacific
 Greenfield
42
CMD 2012
Summary
 Safety first
 Blueprint at all sites
 Manufacturing Excellence
 Lowest cost in Industry
 Earliest to market in key categories
 Seamless integration of all acquisitions
 Standardized low cost site for D&E
 Sustainable operations with global knowledge sharing
EFFICIENCY
INNOVATION
GROWTH
SUSTAINABILITY
43
CMD 2012
SCA Forest Products
Ulf Larsson, President
SCA Forest Products
Europe’s largest forest owner and a cost efficient producer
Forest
Containerboard
Publication paper
Solid wood
45
Pulp
Energy
R&D
Distribution/logistics
CMD 2012
SCA Forest Products
Business overview
 2011 net sales, SEK 20bn
 4,800 employees
46
CMD 2012
Market positions
Publication papers
Solid-wood products
Kraftliner
Growth rate: -2 – -4% p.a.
Growth rate: 1% p.a.
Growth rate: 1 – 2% p.a.
SCA position No 5
SCA position No 2
SCA position No 2
2%
5%
20 %
47
CMD 2012
Market Opportunities
SCA Forest Products
 Long term demand growth for all product areas
except publication papers
 Growing interest for wind and biofuel
 Truly sustainable products for environmentally aware
consumers
48
CMD 2012
SCA Forest Products
Priorities
 Improvement program in difficult market and currency situation
 Reduced exposure to standard newsprint
 Product renewal towards fresh fiber based packaging papers
 Wind power expansion
 Improved market position towards Scandinavian, French and UK
building merchants
49
CMD 2012
Cost and Productivity
SCA Forest Products
 A strong track record of improving cost and productivity
Examples:
- Ortviken
+ 4 %/a in production/FTE 2006-2011
- Saw mills + 3 %/a in production/FTE 2006-2011
 Additional actions necessary due to
current market and currency situation
 Reinforced improvement program
launched in all units
50
CMD 2012
Innovative Solutions
Good potential in renewable energy
 Wind power business model
 JV concept where partners Statkraft and
Fred.Olsen Renewables allocate capex to SCA land
 SCA income from fixed lease and energy price
dependent components
 Hedge for electricity to SCA/Ortviken
 Decided: SEK 8bn, 1.6 TWh/a generation
In pipeline: SEK 16bn, 3.4 TWh/a generation
 Biofuels
 Logging residuals and by-products from forest
industry becomes biofuel
 Deliveries of 3.2 TWh in 2011
 Only 1/3 of potential of logging residuals utilized
51
CMD 2012
Sustainability - our DNA
Commercial advantages
FSC* products
Publication Papers
 SCA is the world’s largest
supplier of FSC* certified
forest products
 Strong growth in sales of
FSC* solid-wood, pulp
and paper products
 SCA is also PEFC**
certified
* Forest Stewardship Council
** Program for the Endorsement of Forest Certification
52
CMD 2012
Sustainability - our DNA
Reduced cost and environmental impact
Investments in lime kilns
 Replacing oil with biofuels
 Significantly reduced carbon dioxide
emissions from fossil fuels
 Annual cost saving of approximately
SEK 50m for each mill
 Östrand
- 17 500 m3 oil/a
- 52 500 ton CO2/a
 Munksund
- 7 500 m3 oil/a
- 22 500 ton CO2/a
53
CMD 2012
Summary
SCA Forest Products – Top 3 priorities
1. Product renewal from publication papers and
especially from standard newsprint
2. Commercialization of wind power
3. Improvement program to address market and
currency situation
EFFICIENCY
INNOVATION
GROWTH
SUSTAINABILITY
54
CMD 2012
Global Hygiene Category
Christoph Michalski, President
Innovation and Branding
Strengthens market positions and profitability
 Build global brand positionings for scale
 Drive innovation for growth and profit
Within a changing global consumer/customer environment
 Changing demographics
 Urbanization
 Price pressures
 Private Label
 Digital globally
56
CMD 2012
Baby Diapers
ONE GLOBAL PACK DESIGN
57
CMD 2012
Performance
through Innovations
58
CMD 2012
Lights by TENA
Innovation success
UK launch summary 2011/12
 14% sales growth vs. previous year
 25% new consumers recruited from Feminine care
 Base sales are at the highest level for 3 years
 lights by TENA have grown shopper numbers
• 30% within lights by TENA only
• 70% on repertoire shoppers (liners, maxi and ultra mix)
 Brand Equity showed improvement amongst
younger consumers on parameters like
substitutability and quality
59
CMD 2012
Dobles launch
Innovation success
 Successfully launched in
Colombia, Australia and France
 Increased SCA liners market
share by recruiting new
consumers from competition
 Reaching 5.8% value market
share of total liners market
 Dobles share of total liners
assortment approx. 12% in
Colombia, 9% in Australasia and
7% in France
Dobles packaging design in Colombia
60
CMD 2012
SCA builds strong Patent positions for
Valuable Innovations
 SCA builds long term
strategic patent protection for
hygiene innovation activities
 On average SCA files 80 new
patent applications per year
 SCA’s patent portfolio
consists of around 1,000
patent families, including
those transferred to SCA
through acquisitions in 2012
61
The Tork dispenser for
hand towel rolls
The unique lock
The feeding
mechanism of the
cassette
The unique design
of the complete
Washroom dispenser
family
The seamless, strong
construction of the
dispenser
A loading and retention
mechanism for paper
refill, including the
unique plug
The function of manual
paper loading
one example of an SCA invention, protected by
several global patent families
CMD 2012
Unify and Connect
SCA and our Product Brands
62
CMD 2012
SCA in the Volvo Ocean Race
Empowering women
 Strengthen the SCA and product brands
 Increase sales and commercial operations performance
 A stronger one company feeling
63
CMD 2012
Summary
 Branding and constant innovation creating
profitable growth today and tomorrow
EFFICIENCY
INNOVATION
GROWTH
SUSTAINABILITY
CMD 2012
64
CMD 2012
SCA Consumer Goods Europe
Magnus Groth, President
One face to retail Customers in Europe
 2011 net sales of SEK 24.5bn
 Consumer tissue biggest category
Sales by category
 Number of employees: 4,300
7%
Consumer tissue
2%
5%
Baby
12%
Feminine
Incontinence
products Retail
74%
66
Other (Cotton
pads)
CMD 2012
Trends in Retail
 Consolidation and internationalization
 Multichannel and multiformat
 Internet shopping
 Promotions
 Retailer brands
67
CMD 2012
Market Positions
Europe
Consumer Tissue
Baby
Feminine
 SCA #1
 SCA #3
 SCA #3
 Growth rate: 3.6%
 Growth rate: 2.1%
 Growth rate: 1.1%
21%
26%
30%
45%
50%
11%
13%
56%
12%
16%
12%
SCA
68
KC
Sofidel
Others
P&G
8%
KC
SCA
Others
P&G
J&J
SCA
Others
CMD 2012
Opportunities
 One face to the Retail customers
 One Go to market approach
 Dual-track strategy
69
CMD 2012
Efficiency
Go to Market Advantage
Channel Management
Trade Spend and Promotion
effectiveness
Sales Force Effectiveness
70
Account Management
Shopper Engagement and
Category Management
Pricing Management
Execution at Retail
Logistics Management
CMD 2012
Maximizing the Shopper journey
Promotional Support
Online
Home
Store
Fixture
+20%
+14%
Confirmed contact
with 61k shoppers
71
CMD 2012
Innovation
Baby private label success story
 Strategic Partnerships
 Product innovation and improved quality
 Thin diapers meet consumer demand
 Dedicated supply chain and retailer brand organization
Secured new contracts and increased volumes with 50%
72
CMD 2012
Growth
Consumer Tissue in Russia
CAGR*: 24%
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Zewa Net Sales in Russia
* Compound annual growth rate
73
CMD 2012
Summary
 Strong supplier to Retailers
 Go to Market is a competitive advantage
 Innovations enable growing faster than the market
EFFICIENCY
INNOVATION
GROWTH
SUSTAINABILITY
74
CMD 2012
SCA AFH Professional
Hygiene Europe
Sune Lundin, President
Away From Home
Business Overview
Products
Tork provides complete professional dispenser and
refill systems for:
 Personal hygiene (hand wiping tissue, toilet
paper and soap)
 Products for wiping, cleaning and polishing
applications
 Napkins and related table-top products
Customers





76
Industrial
Trade and service
Education
Hotels, restaurants, catering
Health care
CMD 2012
Go to Market
Distributors
Service providers
77
End
Customers
CMD 2012
AFH tissue
SCA is the global market leader
SCA is global No. 1
19 % market share
78
CMD 2012
SCA AFH Professional Hygiene Europe
Business overview
 2011 net sales: SEK 7.2bn
 Approx. 10,500 Employees in 2012
 Clear No. 1 position with 31%
market share
 Market leader in all Regions with
the best Supply Chain footprint
79
CMD 2012
Many Opportunities
80
Sustainability
awareness
Innovation & Digital
world
Hygiene awareness
Supply Chain Efficiency
Strong market
positions
Market growth
in Europe
CMD 2012
Growth
 Market growth in Europe of 2%
 Capturing adjacent growth in the
hygiene sector
 Value adding products and services
 Soaps, disinfectants, cleaning solutions,
washroom solutions and design
 Well positioned for growth e.g. in
Russia through local manufacturing
81
CMD 2012
Innovation
82
CMD 2012
Summary
 Strong market positions and good growth opportunities
 Increased efficiency in supply chain
 Sustainability as a differentiator
 Innovations add value
EFFICIENCY
INNOVATION
GROWTH
SUSTAINABILITY
83
CMD 2012
SCA Americas
Don Lewis, President
SCA Americas
Business overview
Sales by Category
6%
9%
 2011 net sales SEK 15.6bn
46%
AFH
 8,300 employees
Consumer tissue
Incontinence care
20%
Feminine
Baby
19%
Sales by Region
22%
North Americas
South America
Mexico & Central
America
22%
56%
85
CMD 2012
Market Positions
North America
AFH
Incontinence care
 Growth rate*: 1.4%
 Growth rate*: 4.7%
 Market position: #3
 Market position: #2
Incontinence care
North America
AFH North America
22%
30%
GP
K-C
7%
21%
34%
K-C
SCA
SCA
Medline
Bay West
First Quality
Other
20%
25%
18%
11%
Other
12%
* CAGR 2012-2015
Healthcare includes Institutions and Homecare
Source: Global Market Database 2011
86
CMD 2012
Market Positions
Mexico & Central America
Tissue
Personal Care

Growth rate*: 4.6%

Growth rate*: 4.8 %

Market positions: #2 Tissue

Market positions: #2 Personal Care
(#2 in Consumer tissue & AFH)
(#1 Incontinence care; #1 Feminine,
#3 Baby)
Mexico/Central America Tissue
Mexico/Central America
Personal Care
10%
16%
K-C
5%
SCA
6%
12%
5%
K-C
9%
SCA
FAPSA
61%
P&G
Other
Mabesa
15%
61%
P&G
Other
*CAGR 2012-2015
87
CMD 2012
Market Positions
South America
Tissue
Personal Care

Growth rate*: 5.5%

Growth rate*: 4.8%

Market positions: #3 Tissue (Consumer

Market positions: #1 Incontinence;
tissue & AFH)
#3 Feminine, #4 Baby
South America
Personal Care
South America Tissue
24%
K-C
40%
19%
7%
88
CMPC
10%
24%
K-C
P&G
37%
SCA
J&J
Santher
SCA
Other
19%
10%
10%
Other
*CAGR 2012-2015
CMD 2012
AFH tissue North America
35% of sales from value added products
35%
33%
29%
26%
20%
16%
13%
8%
9%
6%
2003
89
2004
2005
2006
2007
2008
2009
2010
2011
2012 YTD
CMD 2012
New tissue plant in Mexico
Improved products and increased cost efficiency
90
CMD 2012
Mexico/Central America Incontinence market
Opportunity ripe for SCA as category leader
 Mexican Incontinence category growing at 15% annually
 60+ age group to double by 2025
 Current consumption shows huge opportunity
 SCA the undisputed leader, 40% share
91
CMD 2012
Leveraging strong Brands and Market
share in Colombia with adjacent products
92
CMD 2012
Brazil Expansion
 2011 acquisition of Pro Descart for #2 market position in
incontinence products
 Incontinence market growing rapidly
 2012 TENA launch
93
CMD 2012
Summary
 Insight-driven innovation fueling value added growth in
North America, world’s largest hygiene markets
 Powerful hygiene positions in the fast-growing Latin
American market
EFFICIENCY
INNOVATION
GROWTH
SUSTAINABILITY
94
CMD 2012
SCA Asia Pacific
Ulf Söderström, President
SCA Asia Pacific
Business overview
Sales by category
(post Everbeauty acq)
1%
 Net sales 2011: SEK 2bn*
8%
 2,900 employees
 4 manufacturing plants and 14 OEM
(Malaysia, China, Taiwan)
Baby
Feminine
28%
 Strong global and regional brands
 No.1 Incontinence brand in Asia (ex. Japan)
Incontinence care
60%
Consumer tissue
AFH
3%
Sales by regions 2011
(post Everbeauty acq)
4%
4%
China
Hong Kong
8%
12%
Japan JV
Korea
8%
Taiwan
8%
37%
* Excluding Australia and New Zeeland
96
Malaysia
Philippines
17%
Singapore
2%
Thailand
CMD 2012
Market Positions
Asia
 CAGR* 2011-2017: 6.2%
Incontinence care
5%
4% 3%
Baby
UC
Other
6%
27%
Livedo
Daio
9%
Hakujuji
5%
5%
4% 3%
UC
Other
27%
5%
K-C
Kao
9%
Kao
10%
21%
15%
SCA
P&G
DSG
20%
22%
SCA
Nepia
HengAn
Kami Shoji
Daio
* Compound annual growth rate
97
CMD 2012
Market Positions
Key markets
South Korea
Incontinence care:
2
China Mainland
Incontinence care:
2
Baby:
5
Japan
Incontinence care:
5
Taiwan
Thailand
Baby:
Incontinence care:
1
Baby:
5
3
Hong Kong
Hankies and box facials:
1
Malaysia
Baby:
1
Singapore
Incontinence care:
1
Baby:
Feminine:
3
3
Asia
Incontinence care brand*
* Excluding Japan
98
CMD 2012
1
Market Opportunities
 High organic hygiene growth in China
 Many other fast emerging hygiene markets
 Consolidation opportunities
 More sophisticated consumers
 Rising sustainability awareness
 Significant social media influence
99
CMD 2012
Chinese Market
 Biggest consumer group in the world
 21 million new born babies in 2011
 Age 60+ accounts for 13% of total population
 Growing purchasing power
 Increasing hygiene awareness
 Actionable sustainability commitment
100
CMD 2012
Acquisition of Everbeauty
Leading Asian personal care company
 National sales & distribution network in China
 Efficient low cost production sites
 Strong economy segment brands
 Successful integration program
 Ambitious growth plans
101
CMD 2012
Innovation Case
 During 2012 R&D Asia continued it’s successful momentum and
achievement by launching the following new innovations*.
1. Flirt Value
 A more affordable TENA Belt
2. Libresse PureFresh Green Tea Odor Control
 Feminine hygiene range of sanitary pads and panty liners,
with Green Tea scent and odor control feature
3. Tempo Toilet paper
 A premium quality toilet paper encompassing
both Neutral and Applewood
* All innovations from start to launch within approx. 7 months
102
CMD 2012
Summary
Asia is the engine of future hygiene growth
EFFICIENCY
INNOVATION
GROWTH
SUSTAINABILITY
103
CMD 2012
SCA Incontinence Care Europe
Margareta Lehmann, President
Incontinence Care
SCA is the clear global market leader
SCA is global No. 1
25% market share
No. 2 has 9%
105
CMD 2012
SCA Incontinence Care Europe
Business overview
 2011 net sales of SEK 9.5bn
 Clear European market
leader with 41% market
share and strong positions
in all channels
 Approx. 1,000 employees
 All market segments in one
organization to secure
synergies
106
Channel Split
European Incontinence Market
18%
48%
34%
Home care
Institution
Retail
CMD 2012
Market Position
Clear European No. 1 in Incontinence care
 European market growth rate 3%
 Average Market Penetration 37%
Others 10%
Abena 3%
Attends 4%
Indas 4%
Artsana 4%
SCA 41%
P&G 5%
TZMO 7%
Ontex (incl
Lille) 10%
107
Hartmann
13%
CMD 2012
Market Opportunities
Many growth opportunities to exploit growth in TENA
 Aging society
 Low penetration rates
 Eastern Europe
 Light Incontinence (Lady & Men)
 Increased awareness
of the category
Bakgrunds bild
 Holistic view on care
 Lobbying and Co-payment
 TENA brand strength
108
CMD 2012
Aging Population
Total population aged over 60 approaching 1 billion by 2017
Millions aged over 60 years old
1 200
1 000
+25%
800
600
2010
2017
400
+12%
200
+34%
+21%
0
Total world
109
Europe
China
USA
CMD 2012
Grow Market share
take>50% of market growth
 Drive growth in selected market/segment
combinations
 Grow tender business profitably by
develop tender excellence – influencing
tender criterias
 Increase competiveness in all quality tiers
in the assortment
 Drive Retail growth in all key markets
110
CMD 2012
Grow Penetration in Key segments
Examples Market
Penetration
%
 Increase market value
by upgrading to new
modern concepts, e.g.
Pants
 Increase usage &
value by influencing
reimbursement models
 New users by
innovation and
communication
80
70
60
50
40
30
20
10
Average Pants
market
111
Light
Inco
Female
Light
Inco
Male
CMD 2012
Expand the Category
Leverage TENA strength
Service
Diagnostics
Skin
care
Absorbent
S
Incontinence
products
Patient
hygiene
 Build on core competence
to expand beyond
absorbent products
 Expand core competence
into new service areas
Diagnostics
Training
112
CMD 2012
Innovation
Right Product Offer
Improve
the Core
Increased Heavy Incontinence
development in all quality tiers
Upgrades &
New Launches
Promising launch program in
Light Incontinence & Pants
Drive
new areas
Acquisition of new innovation
concepts; Diagnostics, Patient
Hygiene
113
CMD 2012
Summary
Global Brand with potential:
•
•
•
•
Growing market - demography and low penetration
Customer driven innovation
Expertise in continence management
Strong Go to market approach
EFFICIENCY
INNOVATION
GROWTH
SUSTAINABILITY
114
CMD 2012
Summary
 Transformation
 Leading brands and market positions
 Strong product portfolio and innovations
 Good growth opportunities
 Substantial efficiency improvements
 Profitability improvement
EFFICIENCY
INNOVATION
GROWTH
SUSTAINABILITY
115
CMD 2012
IR Contacts:
Johan Karlsson, VP Investor Relations
Tel: +46 8 788 51 30
Email: ir@sca.com
Louise Tjeder, Director Investor Relations
Tel: +46 8 788 51 62
Website: www.sca.com