annual meeting of stockholders -...
TRANSCRIPT
Annual Meeting of Stockholders
March 3, 2015
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Safe Harbor Statement
Forward-Looking Statements
All presentations contain certain forward-looking information within the meaning of the Private Securities Litigation Reform Act of
1995. The words “may,” “will,” “expect,” “intend,” “estimate,” “anticipate,” “aspiration,” “objective,” “project,” “believe,” “continue,” “on
track” or “target” or the negative thereof and similar expressions, among others, identify forward-looking statements. All forward-
looking statements are based on information currently available to management. Such forward-looking statements are subject to
certain risks and uncertainties that could cause events and the Company’s actual results to differ materially from those expressed or
implied. Please see the disclosure regarding forward-looking statements immediately preceding Part I of the Company’s Annual
Report on the most recently filed Form 10-K. The company assumes no obligation to update any forward-looking statements.
Regulation G
These presentations may include certain non-GAAP financial measures like EBITDA and other measures that exclude special items
such as restructuring and other unusual charges and gains that are volatile from period to period. Management of the company uses
the non-GAAP measures to evaluate ongoing operations and believes that these non-GAAP measures are useful to enable investors
to perform meaningful comparisons of current and historical performance of the company. All non-GAAP data in the presentation are
indicated by footnotes. Tables showing the reconciliation between GAAP and non-GAAP measures are available at the end of this
presentation and on the Greif website at www.greif.com.
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Board of Directors
Vicki L. Avril Former Chief Executive
Officer and President, TMK
IPSCO
Bruce A. Edwards Former Global Chief
Executive Officer,
DHL Supply Chain
Mark A. Emkes Former Commissioner
Finance and Administration,
State of Tennessee
John F. Finn Chairman & Chief
Executive Officer,
Gardner, Inc.
Michael J. Gasser Chairman
Daniel J. Gunsett Partner, Baker Hostetler LLP
Columbus, Ohio
Judith D. Hook Investor
John W. McNamara President & Owner,
Corporate Visions
Limited, LLC
Patrick J. Norton Former Executive Vice President
& Chief Financial Officer, The
Scotts Miracle-Gro Company
David B. Fischer President and Chief
Executive Officer
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Executive Officers
David B. Fischer President and Chief Executive Officer
Peter G. Watson Chief Operating Officer
Lawrence A. Hilsheimer Executive Vice President, Chief Financial Officer
Gary R. Martz Executive Vice President, General Counsel and Secretary
Ivan Signorelli Group President, Rigid Industrial Packaging & Services – Europe, Middle East, Africa
Addison P. Kilibarda Senior Vice President, Global Strategy
Karen P. Lane Senior Vice President, People Services & Talent Development
Timothy L. Bergwall Division President, Paper Packaging
Daniel R. Lister Division President, Flexible Products & Services
Nadeem Ali Vice President, Treasurer
Douglas W. Lingrel Vice President, Chief Information Officer
David C. Lloyd Vice President, Corporate Financial Controller
Christopher E. Luffler Vice President, Business Managerial Controller
Sharon R. Maxwell Assistant Secretary
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Deloitte & Touche LLP
Greg Coy Global Lead Client Service Partner
Jamey Halsey Global Lead Audit Partner
John Brown Lead Audit Senior Manager
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Greif serves diverse end markets such as chemicals, paints and
pigments, food and beverage, petroleum, adhesives, industrial
coatings, agricultural, pharmaceutical, minerals and building products
$4.241
Rigid
Industrial
Packaging
& Services
$3.0771
Flexible
Products
& Services
Paper
Packaging Land
Management
$4261
$7071
$331
$4.24 Billion
Net sales for 12 months ended
October 31, 2014
250 Nearly 250 operations
>50 Operations in more than
50 countries
13,500 Approximate number of
employees worldwide
Diversified Business Platform and Global Footprint
1 Twelve months ended October 31, 2014
World’s Leading Industrial Packaging Company
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Fiscal 2014 Priorities
2014 Priorities
Continuing to emphasize safety in all facilities and work-
related activities;
Making further progress on reducing operating working
capital and increasing cash flow;
Addressing capacity utilization issues in Flexible
Products & Services;
Increasing integration levels, capacity and product
differentiation efforts in Paper Packaging;
Implementing more Greif Business System initiatives to
improve performance; and
Restructuring selected geographies and assets that
persist with unacceptable results
Achievements Included
Medical Case Rate decreased to 1.45 from 1.47 in
fiscal 2013
Initiated project to increase mill capacity and
announced sixth corrugator in response to market
demand
Initial reductions in targeted SG&A expenses, portfolio
optimization and increased operating efficiencies
Restructuring actions in all regions with particular
emphasis on underperforming RIPS and FPS
operations
Free cash flow increased to $204 million from $130
million the prior year
Closed KSA fabric hub and revised the FPS business
strategy
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You can trust us…
Greif picked for Forbes magazine’s
“America’s 100 Most Trustworthy Companies”
http://www.forbes.com/sites/kathryndill/2014/03/18/americas-100-most-trustworthy-companies/
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Together for Sustainability Members
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Greif Awarded Silver Recognition Level
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Michael J. Gasser Global Sustainability Award
Recognizes the environmentally focused activities of Greif associates
and superior effort and achievement in furthering the improvement of
the environment and the company.
2014 Winner
Ivan Signorelli - Life Cycle Analysis
The Greif Green Tool Team
Project
Under the leadership of Ivan Signorelli, The Greif Green Tool
was developed to enable our customers to choose the right
packaging products that will keep their products safe
while helping them meet their sustainability goals.
Award Winners
Ivan Signorelli, James King, Greg Layer, Nick Sheets, Aysu Katun, Randy Stacy,
Gustavo Melo, Philippe Marty, Peter Wittocx and Virginia Hu.
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2015 Goals
• Safety – reduce medical case rate by 10%
• Execute enterprise-wide transformation process
• Actively pursue portfolio optimization
• Increase financial strength and flexibility
• Continue to abide by The Greif Way
The Path of Transformation
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15
Greif Transformation Video
Greif Transformation Video
16
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Portfolio Optimization Quadrant Summary
Transform or Fix
16 Value Cells
Divest 13 Value Cells
Invest To Grow 5 Value Cells
Protect the Core 25 Value Cells
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Value Cells
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Portfolio Optimization Quadrant Summary
Transform or Fix
16 Value Cells
Revenue $788M
Divest 13 Value Cells
Revenue $445M
Invest To Grow 5 Value Cells
Revenue $903M
Protect the Core 25 Value Cells
Revenue $1,947M
Revenue *
$4,083
* Adjusted revenue (minus divestitures and land management). Note: A reconciliation of the
differences between all non-GAAP financial measures used in this presentation with the most directly
comparable GAAP financial measures is included in the Appendix to this presentation.
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Transform or Fix
• Top down diagnostic targets developed
• 100% bottoms up plans received
• All plans ready for execution by Feb 15th
Portfolio Optimization Progress to Date
Invest To Grow • Paper Mill Integration
• CorrChoice
• Innovative products and services
• Drum Plant Jubail, Saudi Arabia
Protect the Core
• Top down targets assigned
• Plans being developed
• Begin execution by March 31
Divest
• Strategic review process
• Several actions completed
• Balance divestitures with Invest to Grow
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Transformation Initiatives’ Work Streams • Master plan
• Work stream coordination
• Track activities & impact
• Manage communications
PMO
0
• Talent & skills development
• Performance management
• Reward & recognition
• Organizational health / employee
engagement
Talent & Org
Health
1
• Top-down enterprise strategy
• Segment level strategy
• Bottoms-up financial plans
• Contingencies
• Strategic planning process
• 3 year holistic strategic plan
Strategy
2
• Transform / fix
• Protect the core
• Invest to grow
• Potential divest1
• Resource allocation process
Portfolio
Optimiz-ation
3
• Quick wins
• Corporate / business benchmarking
• Work process redesign
SG&A
Efficiency
4
• Quick win enablers
• Customer centricity
• Sales effectiveness
• Capabilities
• Supporting the change
GBS
Com-Ex
5
• People development
• Safety
• Quality
• Stability
• Elimination of waste
GBS
Op-Ex
6
• Network optimization
• Inventory management
• Strategic sourcing
• Sales & operations planning
• Standardization
• Logistics
GBS Sourcing
& Supply Chain
7
• Diagnostics
• Accounts receivable
• Accounts payable
• Inventory
• IT
Working Capital
Reduction
8
1 – Pending strategic review
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Free Cash Flow and Dividends Paid (Dollars in millions)
2009 2010 2011 2012 2013 2014
Free Cash Flow After Purchases of PP&E $141.8 $34.0 $9.8 $307.3 $113.9 $123.9
Dividends Paid 88.0 93.1 97.8 97.7 98.3 98.6
Free Cash Flow After Purchases of PP&E / Dividends Paid 1.6x 0.4x 0.1x 3.1x 1.2x 1.3x
(1)
(2)
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Greif Debt Ratios vs. Industry Peer Group Averages
Industry
Peer Group
Average(1)
Greif
Fiscal 2013(1)
Greif
Fiscal 2014
Greif
Forecast 2015
Net Debt(2)
/EBITDA (3)
2.5X 2.4X 2.3X 2.5X
Total Debt/Capital 58% 48% 49% 48%
1 Provided from a respected industry analyst’s report, permission granted to use the information without attribution, the data was comp iled under CFA guidelines from publicly available information.
2 Net debt represents long-term debt plus the current portion of long-term debt plus short-term borrowings less cash and cash equivalents.
3 EBITDA is defined as net income plus interest expense, net, plus income tax expense, less equity earnings of unconsolidated subsidiaries, net of tax plus depreciation, depletion and amortization
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Financial Metrics
Value (%)
• Operating Profit %
Gross Profit %
SG&A %
• Operating Working Capital %
Drivers of Value
• Targeted Growth by Business
• Innovation Revenue Mix
From 2014
7.5%
19.1%
11.7%
9.7%
Business
Specific
To 2017
10.0%
20.0%
10.0%
<7.5%
Impact
30%+ Improvement
$50M+ Operating Margin
$50M+ Operating Margin
$100M Cash
2-3% Net Sales Growth
in 2016 & 2017
Product
Diversification 2-3% Net Sales Growth
in 2016 & 2017
Product
Diversification
Business
Specific
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Industry Debt Loads
AptarGroup Inc
Avery Dennison Corp Ball Corp
Bemis Company, Inc.
Berry Plastics Group, Inc.
Crown Holdings, Inc.
Graphic Packaging Holding
Greif Inc
MeadWestvaco Corp
Multi-Color Corp
Owens-Illinois Inc
Rexam PLC
Sealed Air Corp
Silgan Holdings Inc
Sonoco Products Co
0%
20%
40%
60%
80%
100%
120%
140%
160%
- 1.0 2.0 3.0 4.0 5.0 6.0
To
tal
Deb
t/T
ota
l C
ap
ital
Total Debt/LTM EBITDA
Source: Baird Research, December 2014
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Questions
26
Appendix
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Analysis of Fiscal 2014 Net Sales Excluding Divestitures
and Land Management
Greif, Inc.
As Reported Divestitures
Greif, Inc.
Excluding
Divestitures Land Management
Greif, Inc. Excluding
Divestitures and
Land Management
Net Sales 4,239.1$ (126.6)$ 4,112.5$ (29.5)$ 4,083.0$
(Dollars in millions)
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Free Cash Flow and Dividends Paid
2015
2009 2010 2011 2012 2013 (1) 2014 (1) Forecast
Net cash provided by operating activities $266.5 $178.1 $172.2 $473.3 $250.3 $261.8 $225.0 - 261.0
Purchases of properties, plants and equipment (124.7) (144.1) (162.4) (166.0) (136.4) (137.9) (150.0)
Free cash flow after purchases of PP&E 141.8 34.0 9.8 307.3 113.9 123.9 75.0 - 111.0
Acquisitions of companies, net of cash acquired (90.8) (179.5) (344.9) - - (53.5) -
Proceeds from the sale of properties, plants, equipment, 50.3 17.3 31.0 13.9 15.6 133.2 5.0 - 9.0
businesses and other assets
Free cash flow excluding timberland transactions 101.3 (128.2) (304.1) 321.2 129.5 203.6 80.0 - 120.0
Purchases of timber properties (1.0) (21.0) (3.4) (3.7) (9.0) (56.8) (34.0)
Proceeds from the sale of timber properties - - - 0.0 25.9 31.7 34.0
Free cash flow including timberland transactions 100.3 (149.2) (307.5) 317.5 146.4 178.5 80.0 - 120.0
Class A dividends 37.0 39.5 42.3 42.2 42.8 42.8
Class B dividends 51.0 53.6 55.5 55.5 55.5 55.8
Dividends paid 88.0 93.1 97.8 97.7 98.3 98.6
FCF after purchases of PP&E / dividends paid 1.6x 0.4x 0.1x 3.1x 1.2x 1.3x
(Dollars in millions)