04/12/2012
Amcor Tobacco Packaging
Peter Konieczny, President Amcor Tobacco Packaging
Key messages
• Integration of Alcan Packaging has strengthened Amcor’s
market position in Tobacco Packaging
• Growth driven by
• Providing superior value to customers leveraging
Scale
Global footprint
Innovation capabilities
Operating excellence
• Actively participating in market consolidation
including expansion into emerging markets
Strong business with excellent growth opportunities
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04/12/2012
Global footprint
Americas
Europe
Plants
Sales (A$b)
6
0.3
1
Canada
3
1
1
Netherlands
1
Germany
1
1
France
1
USA
Switzerland
1
1
Asia (excl. AMVIG)
Plants
Sales (A$b)
Portugal
13
0.8
1
UK
1
Plants
Sales (A$b)
1
Russia
Poland
1
Ukraine
1
Turkey
1
Kazakhstan
7
China (AMVIG)
Mexico
1
Tobacco
Packaging
22 plants
18 countries
A$ 1.2b global sales
3
0.1
1
1
1
Philippines
Malaysia
Singapore
Argentina
1
Legacy Amcor
1
Legacy Alcan
1
New acquisitions
AMVIG
3
Products
• Hinge-lid cartons (HL)
(variants include square boxes,
round corners & bevelled edge
boxes)
• Bundle wraps (paper and film)
• Reel fed and cut promotional
• Shells and slides
• Display cartons (DCs)
inserts and labels
• RYO (roll your own) booklet
covers
• Soft packs (paper)
• Chewing gum
• Inner frames
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Major customers
5
Growth opportunities in Asia, Africa and Middle East
Retail volumes
Trillion sticks
CAGR
-1.1%
CAGR
-1.3 %
1.292
2.872
1.221
2.416
0,334
China
Europe
0,313
North America
11’
11’
11’
16’
16’
16’
CAGR
+0.6%
CAGR
+ 2.0%
CAGR
-0.9%
1.061
0,451
0,245
Asia
Africa &
Middle East
Latin America
11’
1.092
0,408
0,233
16’
11’
Source: Euromonitor International 2012
16’
11’
16’
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Amcor sales growth higher than industry volume growth
Topline growth drivers:
• Higher value add cartons
125%
Amcor topline growth
- Innovation
+ 16%
• Print enhancements
• Pack complexity
• Market share gains
100%
- 3%
• Inflation - modest
Cigarette retail volume*
Innovation leadership drives
sales growth
2010
2011
2012
* Global retail consumption excludes China & North Korea
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Share gain potential in emerging markets
Amcor share of volume by region
Asia*
Positive
Amcor
8%
Others
Africa & ME
Latin America
11%
Consumption
Europe
26%
North America
47%
Negative
77%
High
ATP Share
Low
* Asia excludes China and North Korea
Source: Euromonitor International 2012, Amcor market intelligence
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Growth also comes from regional tobacco manufacturers
Cigarettes produced 2011
73%*
27%
25%
19%
14%
8%
4%
PMI
BAT
Amcor
position
JT Group
ITG
PM USA
SIGNIFICANT
3%
RA
Others
< 10%
Top six cigarette manufacturers hold 73% global share (excluding China and North Korea)
*Global tobacco cigarette segment excludes China and North Korea
Source: Euromonitor International 2012, Amcor market intelligence
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Road map to growth
CAGR top line = 7%
since Alcan acquisition
Mature markets
• North America
• Europe
Emerging/new markets
• Latin America
• Asia
• Africa & Middle East
•
•
•
•
•
•
•
•
Gain share
Capture benefits from increased design
complexity
Conversion from soft pack to HL format
Consolidate
Selectively diversify
Acquisitions and
self – manufacturing buy outs
Follow existing (global) customers
Win new regional customers
Enablers
Unique Value Proposition
• Scale
• Global footprint
• Innovation capabilities
• Operating excellence
Strong customer relationships
Partnership
Acquisitions in Mexico and
Argentina
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Unique customer value proposition
Product innovation
Value creation
Operational productivity
• Customer back and pro-active
product innovation
• Cost conscious solution
development
• Increase of speed to market
• Implementation of global
solutions for contingency and
innovation
• Reduction of total costs
across combined supply chain
Innovation
Global footprint
Scale
Operating excellence
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Total service provider
Complete ‘turnkey’ project management, from idea generation to manufacturing:
New product development
3D virtual mock-ups
Physical mock-ups and sampling
Pre-press & CAD
Technical support
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A global innovation network
Amcor
PrePrint Centre
Lodz, Poland
Amcor
Innovation Centre
Rickenbach, Switzerland
Amcor
PrePrint Centre
Novgorod, Russia
Amcor
Innovation Centre
Singapore
Amcor
Design Studio
Reidsville, NC, USA
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Investment in innovation
Latest technology Lemanic Riviera 820 gravure press (R2)
• Newest technology gravure press
• New automated delivery end for fast changeovers
• Complex job capabilities (11 print units, UV Inert, etc)
New era KBA sheet-fed offset press
• Latest generation and globally unique cutting-edge technology
• 19 printing and finishing units, incl. 3 coaters, 10 print units, UV Inert
• Vinfoil in-line cold-foil finishing capabilities
Moog innovation press
• Single PU sheet fed gravure press
• Ideal machine to rapidly produce Mock ups/Prototypes,
technical trials and small volumes in industrial quality
• Increased speed to market
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Product innovation examples
Project B – Marlboro beyond
• An in-setting device installed on one of our gravure presses
allows for in-line registration of the lens in order to achieve
industrial production speeds and reduce waste. It also provides
the ability to add registered holographic features to a pack
Glide Tec
• Unique to the market, the Glide Tec pack includes a one hand
opening feature - with one movement of the thumb, the pack lid
automatically opens, exposing the product. The lid closes when
the thumb is drawn down the window again
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Growing non-tobacco products in North America
Segmentation
• Gravure technology
• High similarity to cigarette packs
• Small packs
• High volumes
• High quality and complexity
– UV varnish
– Embossing
– Special inks
Progress
• Started producing Wrigley’s in 2004:
5 SKU’s, 10 million units p.a.
• Today Amcor Americas are producing
50 different SKU’s, 1.6 billion units p.a.
• Worked with Wrigley’s to develop ‘React’ chewing gum pack,
which changes colours upon consumer’s touch
• Wrigley is now 3rd largest customer of Amcor Americas
• Contract signed with Cadbury in 2010
Selective diversification at controlled pace
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Latin America acquisitions
Extend value proposition to global
customers
Grow through regional expansion into
attractive markets
• Builds unique global footprint, unmatched in
industry
• Market is highly concentrated
• 65% of market is represented by 3
countries (Brazil, Argentina, Mexico)
• Provides first-mover advantage
• 90% of market is captured by 2 global
customers
• Controlled risk of market entry by
• Ensuring customer support
• Market demand is stable*
• Leveraging regional Amcor footprint
• Accelerated pace of innovation
Sound rationale, integration on track
* Considering conversion from soft packs to hinge lid cartons
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Summary
• Tobacco Packaging is well positioned for growth
• Well capitalized business
• Unmatched value proposition
• Key drivers
• Value increase through innovation
– Print enhancement and pack complexity
• Integration of recent acquisitions in Latin America
• Emerging markets
Strong business with excellent growth opportunities
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04/12/2012
Amcor Tobacco Packaging
Peter Konieczny, President Amcor Tobacco Packaging
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