michael mack · * sales-weighted basket of emerging market currencies excl. brl, uah, rub • chf...
TRANSCRIPT
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Basel, April 28, 2015
Michael Mack Chief Executive Officer
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2014: strong sales performance
• Integrated sales up 7% excluding glyphosate
• Double digit growth in emerging markets for fifth consecutive year
• ELATUS™ sales in Brazil exceed $300m
Full year integrated sales: 6% CER
Growth target achieved despite lower crop prices
Stocks-to-use ratio* %
Crop price index* May 2001 = 100
* basket of corn, wheat, soybean and rice
29
24
20
22 21
19 19
22
24 23
22 21
22 ~23
0
100
200
300
400
500
10%
15%
20%
25%
30%
35%
01 02 03 04 05 06 07 08 09 10 11 12 13 14 E
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ELATUS™: Syngenta’s largest and most successful launch
Peak sales potential raised from >$500m to $1bn
Yield advantage vs. competitor products
1'500 2'000 2'500 3'000
Control
Standard
Competitor SDHI
™
Treatment
Kg/ha
Soybean yield
• >1,000 sales people reaching ~90,000 customers
• Market share gain in fungicides
• Expected Solatenol™ approvals – 2015: corn, wheat, specialty in USA – 2016: cereals in EU
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4
2014 financial highlights
Group sales: $15.1bn 3%
Sales including Lawn and Garden: 5% CER Volume +2% Price +3%
* Fully diluted basis, excluding restructuring and impairment
• EBITDA up 1% at $2.9bn, margin 19.3% – adverse currency and mix effects
• EPS* up 1% at $19.42
• Free cash flow before acquisitions $1.2bn
• Dividend up 10% to CHF 11.00 per share
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Increasing cash return to shareholders
0
2
4
6
8
10
12
14
0
10
20
2008 2009 2010 2011 2012 2013 2014
Dividend per share USD
Earnings per share* $
* Fully diluted basis, excluding restructuring and impairment 2014 dividend at end-January exchange rates
• Proposed dividend increase: +10% in CHF
• Net debt to equity 27% (2013: 24%)
• Flexibility for acquisitions
• Tactical share buybacks
• Commitment to progressive dividend policy
Dividend per share $
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Currency movements: dollar strength End quarter % change vs. dollar indexed to December 31, 2012
* Sales-weighted basket of emerging market currencies excl. BRL, UAH, RUB
• CHF ~13% costs, ~1% sales
• EUR ~20% sales: balanced exposure
• Developed market currencies hedged
• Emerging markets: raising prices to offset currency impacts
• Estimated currency headwind in 2015: $130m excluding CIS
Russian ruble
Brazilian real
Ukrainian hryvnia
-80
-60
-40
-20
0
20
CHF
EUR
RUB
BRL
UAH
GBP Emerging Markets*
2014 2015 2013
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Accelerating Operational Leverage program to drive margin
EBITDA contribution
Annual cash outflows
$m
~265*
230 200 200 200
~475
~730
~1,000 ~1% ~3% ~4% ~5%
2015 2016 2017 2018
EBITDA margin contribution
50 250 425 600 Working capital release
* Includes existing program savings: $75 million in 2015
R&D Global operations Commercial
● Simplified marketing structure ● Integrated demand and production
management ● Field development rationalization ● Outsourcing of standard activities
● Seeds production cost optimization ● Procurement and manufacturing
fixed cost reductions
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Integrated offers: global strategy adapted by region
● Focus on reinforcing crop protection leadership
● Seeds: focus on distinctive traits ● Integrated offers:
- Water+ Intelligent Irrigation - AGRIEDGE EXCELSIOR®
● High yield soybean solutions; ELATUS™
● Integrated pest management; new AVICTA® registration
● Further share gain in sugar cane
Latin America
Global leader in CP
Broad seeds portfolio
Crop-based strategies
Marketing excellence
● SDHI fungicides gaining ground: Solatenol™ launch to come
● HYVIDO® barley expansion: paving the way for hybrid wheat
● Market leadership in sunflower seeds pulling crop protection sales
● Ongoing focus on higher margin products
● Rice and vegetables protocols tailored to smallholder needs
● Corn: Start Right solution, traits expansion
Europe, Africa, Middle East
Asia Pacific
2014: share gain in
3 of 4 regions* * Preliminary data
North America
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Long term market growth potential
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
65
60
55
50
45
40
35
30
0
Crop Protection market size $bn
2004-2006: 1% CAGR
2006-2008: 14% CAGR
2008-2010: (2)% CAGR
2010-2012: 9% CAGR
• 2001 - 2005: low crop prices, low investment
• Emerging market productivity drive gathered pace from 2006
• Growing need to manage resistance
• Exceptional crop production levels in 2013 and 2014
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Integrated sales by crop
Key crops Sales (bn)
2014 CER % change vs. 2013
Pipeline target
Cereals 1.9 +12% ~2.8
Corn 3.4 -4% ~5.5
DFC 1.4 +1% >2.2
Rice 0.6 +2% ~2.0
Soybean 3.0 +18% ~4.0
Specialty 2.1 +7% ~4.0
Sugar cane 0.3 -2% ~2.0
Vegetables 1.7 +5% >3.0
Integrated sales 14.4 +6% 25.0
$25bn target: achievement expected post 2020
• 5 of 8 crops on track for pipeline target in 2020
• Cereals, Soybean: strong 2014 performance driven by innovation
• Corn: acreage decline in 2014. Longer term traits expansion, resistance management, emerging markets
• DFC, Vegetables: diverse seeds portfolio, integrated offers
• Rice, Specialty, Sugar cane: targets stretched based on progress to date
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New and pipeline products: $700m increase in peak sales
Cereals and DFC Corn Rice Soybean
Vegetables and Specialty Peak sales
SEGURIS >$150m
~$500m
CLARIVA >$200m
~$1,000m
>$400m
>$250m
Oxathiapiprolin >$100m
New fungicide >$300m
Already launched Launches to come
Solatenol™
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Emerging markets are key to future growth
0
10
20
30
40
50
60
0
3'000
6'000
9'000
EM sales Emerging EAMEEmerging APAC Latin AmericaEM sales % of total sales
Sales $m
% of total sales
CAGR +12%
• >50% sales in emerging markets
• Managing volatility key to business success: currencies, credit
• Significant yield gaps vs. developed markets
– technology adoption, intensification
• Broad portfolio and tailored offers
– APAC: rice, vegetables
– Eastern Europe: cereals, sunflower
– Latin America: soybean, specialty, sugar cane
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Michael Mack��Chief Executive Officer2014: strong sales performanceELATUS™: Syngenta’s largest and most successful launch2014 financial highlightsIncreasing cash return to shareholdersCurrency movements: dollar strengthAccelerating Operational Leverage program to drive marginIntegrated offers: global strategy adapted by regionLong term market growth potentialIntegrated sales by cropNew and pipeline products: $700m increase in peak salesEmerging markets are key to future growthSlide Number 13