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1<br />
<strong>SCA</strong><br />
Capital Market Day <strong>2011</strong><br />
Jan Johansson, President and CEO<br />
CMD <strong>2011</strong>
Macro and economic outlook<br />
Uncertainty rules<br />
Standard & Poor’s decision to downgrades<br />
US’s credit rating to AA+<br />
Market’s fear over the Euro<br />
Measures to stabilize debt <strong>market</strong>s in the<br />
Eurozone<br />
2<br />
Inflation in China was<br />
reported at 6.4 percent<br />
in June of <strong>2011</strong><br />
CMD <strong>2011</strong>
<strong>SCA</strong> Group<br />
Sales split 2010<br />
3<br />
Forest Products<br />
Sales split<br />
24%<br />
16% 24%<br />
36%<br />
Personal Care<br />
Packaging Tissue<br />
CMD <strong>2011</strong>
Increasing hygiene sales<br />
4<br />
% of net sales<br />
100%<br />
80%<br />
60%<br />
40%<br />
20%<br />
0%<br />
54%<br />
46%<br />
2000 2010<br />
Packaging and<br />
Forest Products<br />
40%<br />
60%<br />
Hygiene products<br />
(Personal Care and Tissue)<br />
CMD <strong>2011</strong>
Leading <strong>market</strong> positions<br />
Global and regional<br />
North America<br />
AFH tissue: 3<br />
Incontinence care: 3<br />
Mexico<br />
Incontinence care: 1<br />
Tissue: 2<br />
Feminine care: 1<br />
Baby diapers: 3 Global<br />
Colombia<br />
Incontinence care: 1<br />
Feminine care: 1<br />
Tissue: 1<br />
5<br />
Europe<br />
Tissue: 1<br />
Corrugated board: 2<br />
Baby diapers: 2<br />
Incontinence care: 1<br />
Privately owned forests: 1<br />
Solid-wood products: 2<br />
Incontinence care: 1<br />
AFH tissue: 2<br />
Australia<br />
Feminine care: 1<br />
Incontinence care: 1<br />
Tissue: 2<br />
CMD <strong>2011</strong>
Packaging and Publication papers<br />
European <strong>market</strong><br />
6<br />
Other<br />
Corrugated board<br />
56%<br />
10%<br />
<strong>SCA</strong><br />
20%<br />
5%<br />
5%<br />
DS Smith<br />
4%<br />
Saica<br />
Mondi<br />
Publication papers<br />
6%<br />
Smurfit Kappa Other<br />
29%<br />
UPM (incl. Myllykoski)<br />
Holmen<br />
6%<br />
Norske Skog<br />
10%<br />
<strong>SCA</strong><br />
17%<br />
32%<br />
Stora Enso<br />
CMD <strong>2011</strong>
Incontinence care<br />
Market shares<br />
Covedien<br />
North America<br />
Med<br />
Other<br />
11%<br />
FQP<br />
32%<br />
5%<br />
Panalex<br />
6%<br />
Biopapel<br />
Other<br />
6%<br />
10%<br />
26%<br />
18%<br />
19%<br />
KC<br />
20%<br />
27%<br />
Latin America<br />
20%<br />
<strong>SCA</strong><br />
<strong>SCA</strong><br />
KC<br />
Hypermarcas<br />
Other<br />
29%<br />
Artzana<br />
4%<br />
5%<br />
TZMO 8%<br />
Ontex<br />
Other<br />
Europe<br />
46%<br />
13%<br />
41%<br />
Hartmann<br />
Global<br />
25%<br />
<strong>SCA</strong><br />
<strong>SCA</strong><br />
9%<br />
7%<br />
KC<br />
6% 7% FQP<br />
Hartmann Unicharm<br />
CMD <strong>2011</strong><br />
7 CMD <strong>2011</strong>
Baby diapers and Feminine care<br />
Market shares<br />
Other<br />
6%<br />
8%<br />
5%<br />
P&G 12%<br />
TQ<br />
Hypermarcas<br />
8<br />
Latin America*<br />
Baby diapers*<br />
<strong>SCA</strong><br />
7%<br />
62%<br />
* Market share in <strong>SCA</strong>s <strong>market</strong>s<br />
KC<br />
12%<br />
2%<br />
10%<br />
9%<br />
Other<br />
<strong>SCA</strong><br />
Hyga<br />
Ontex<br />
KC<br />
12%<br />
Feminine care*<br />
P&G<br />
CMPC Other<br />
2%<br />
J&J 3%<br />
12%<br />
35%<br />
20%<br />
28%<br />
KC<br />
<strong>SCA</strong><br />
Europe<br />
Baby diapers Feminine care<br />
55%<br />
P&G<br />
TZMO<br />
Ontex<br />
J&J<br />
Other<br />
4%<br />
6%<br />
15%<br />
17%<br />
8%<br />
<strong>SCA</strong><br />
50%<br />
P&G<br />
CMD <strong>2011</strong>
Consumer tissue<br />
Market shares<br />
Manpa y Brika<br />
Kruger<br />
CMPC<br />
Other<br />
4%<br />
10%<br />
12%<br />
14%<br />
* Market share in <strong>SCA</strong>s <strong>market</strong>s<br />
9<br />
18%<br />
<strong>SCA</strong><br />
42%<br />
Other<br />
KC<br />
36%<br />
Wepa<br />
8%<br />
Europe<br />
8%<br />
25%<br />
11%<br />
KC<br />
12%<br />
<strong>SCA</strong><br />
Other<br />
Sofidel<br />
Latin America* Global<br />
GP<br />
54%<br />
8%<br />
<strong>SCA</strong><br />
8%<br />
2%<br />
17%<br />
Sofidel<br />
11%<br />
P&G<br />
KC<br />
GP<br />
CMD <strong>2011</strong>
AFH tissue<br />
Market shares<br />
Other<br />
Cascades<br />
Bay West<br />
Kruger<br />
CMPC<br />
KC<br />
Fapsa<br />
4%<br />
7%<br />
Other<br />
4%<br />
5%<br />
9%<br />
18%<br />
21%<br />
17%<br />
* Market share in <strong>SCA</strong>s <strong>market</strong>s<br />
10<br />
North America Europe<br />
20%<br />
18%<br />
47%<br />
30%<br />
Latin America*<br />
<strong>SCA</strong><br />
<strong>SCA</strong><br />
GP<br />
KC<br />
Other<br />
Other<br />
44%<br />
Duni<br />
45%<br />
4% 7%<br />
Metsä<br />
19%<br />
11%<br />
Global<br />
15%<br />
GP<br />
<strong>SCA</strong><br />
<strong>SCA</strong><br />
16%<br />
18%<br />
16%<br />
2% 3% GP<br />
Metsä<br />
Bay West<br />
KC<br />
KC<br />
CMD <strong>2011</strong>
Strategic focus areas<br />
� Cost reductions in all<br />
business areas of close<br />
to SEK 1bn***<br />
� Cash flow from current<br />
operations SEK 7.4bn***<br />
� Efficiency programs in<br />
Packaging and Forest<br />
Products<br />
� Supply Chain<br />
excellence and asset<br />
utilization programs in<br />
Tissue Europe<br />
� Restructuring program<br />
in baby diapers in<br />
Europe<br />
� New tissue plant in<br />
Mexico<br />
� New personal care<br />
plant in Russia<br />
� Further tissue<br />
investments in<br />
Kostheim and Sovetsk<br />
� Investment in Bollsta<br />
sawmill<br />
� Personal Care<br />
� Tissue<br />
� Thin baby diaper<br />
� Tena Ultra thins<br />
� Strong Tena value<br />
assortment<br />
� Tork Xpressnap Café,<br />
Tork Performance<br />
� Tempo ice, Zoo<br />
Boxes<br />
� Packaging<br />
� Trueflo<br />
� ZeoCool<br />
� Forest Products<br />
� Increased value<br />
added<br />
� <strong>SCA</strong> Group 5%*<br />
� Personal Care 2%**<br />
� Emerging Markets 10%**<br />
� Tissue 2%**<br />
� Emerging Markets 6%**<br />
� Packaging 20%*<br />
� Forest Products 3%**<br />
Acquisitions:<br />
� Mexico- Copamex<br />
� Turkey- 95% San Saglik<br />
� Turkey- 50% Komili<br />
� Brazil – Pro Descart<br />
� <strong>SCA</strong> and Fred.Olsen<br />
Renewables to construct<br />
wind farms<br />
* 2010 adjusted for exchange rate movements and divestments<br />
** 2010 adjusted for exchange rate movements<br />
*** 2010<br />
11 CMD <strong>2011</strong>
Strategic focus<br />
Yielding results<br />
12000<br />
10000<br />
8000<br />
6000<br />
4000<br />
2000<br />
* Excluding extraordinary items<br />
0<br />
Operating profit*<br />
2008 2009 2010<br />
12 CMD <strong>2011</strong>
Decreased net debt<br />
And improved debt payment capacity<br />
13<br />
SEKm<br />
50 000<br />
40 000<br />
30 000<br />
20 000<br />
10 000<br />
0<br />
26%<br />
Net debt decreased SEK 10.4bn<br />
31%<br />
35%<br />
2008 2009 2010 H1 <strong>2011</strong><br />
Net debt Debt payment capacity<br />
37%<br />
0<br />
%<br />
50<br />
40<br />
30<br />
20<br />
10<br />
CMD <strong>2011</strong>
Innovation for profitable growth<br />
� Meet changing demands and requirements<br />
� Create long-term, profitable differentiation<br />
� Strengthen <strong>market</strong> positions<br />
� Build stronger brands<br />
� Drive growth<br />
14 CMD <strong>2011</strong>
Growth<br />
<strong>SCA</strong>’s growth <strong>market</strong>s<br />
15<br />
Latin America<br />
South East Asia<br />
Eastern Europe<br />
/Russia<br />
Middle East<br />
China<br />
� Strong <strong>SCA</strong> positions<br />
� Good <strong>market</strong> growth<br />
� Favourable socio-demographics<br />
� Good <strong>market</strong> growth<br />
� Favourable socio-demographics<br />
� Incontinence care products<br />
CMD <strong>2011</strong>
Growth<br />
High growth in Emerging <strong>market</strong>s<br />
H1 <strong>2011</strong><br />
Emerging <strong>market</strong>s hygiene sales growth:<br />
16<br />
Personal Care: +9%*<br />
Tissue: +9%*<br />
% of Hygiene sales in 2010<br />
21%<br />
* Adjusted for exchange rate movements<br />
Emerging <strong>market</strong>s<br />
Mature <strong>market</strong>s<br />
CMD <strong>2011</strong>
Sustainability as a business driver<br />
� Reduced cost<br />
� ESAVE = SEK 600m in annual cost savings<br />
� Improved competitive edge<br />
� Sustainability credentials generate good business<br />
� Great growth potential through customized offerings in D&E <strong>market</strong>s<br />
� Renewable energy, wind power, biofuels<br />
� World’s largest producer of FSC-certified products<br />
� Attract investors<br />
� 23% of investors in <strong>SCA</strong> shares make sustainability screening<br />
� Reduced risk level<br />
� Attract top talents<br />
� Strengthen the brand<br />
17<br />
CMD <strong>2011</strong>
Financial targets<br />
Remain unchanged<br />
18<br />
ROCE* Sales growth**<br />
Personal Care 30% 5-7%<br />
Tissue 13% 3-4%<br />
Packaging 10%<br />
Forest Products 11%<br />
Group 13%<br />
* Return on <strong>capital</strong> employed, over a business cycle<br />
** Annual organic sales growth<br />
CMD <strong>2011</strong>
Strategic focus areas<br />
19<br />
CMD <strong>2011</strong>
20<br />
<strong>SCA</strong> Packaging<br />
Michael Cronin, President<br />
CMD <strong>2011</strong>
<strong>SCA</strong> Packaging<br />
� Net sales of SEK 26.2bn<br />
� 170 production facilities, including 6<br />
containerboard mills<br />
� Europe’s second largest corrugated packaging<br />
company with 10% <strong>market</strong> share<br />
� 13,750 employees<br />
� Full-service supplier of packaging solutions<br />
� Main customers are the FMCG & manufacturing<br />
industries<br />
21<br />
Industrial packaging 4%<br />
Service 4%<br />
Consumer<br />
packaging<br />
20%<br />
Protective packaging 3%<br />
Conventional<br />
corrugated board<br />
69%<br />
CMD <strong>2011</strong>
Integrated packaging company<br />
<strong>SCA</strong> Recycling<br />
22<br />
Retailers<br />
<strong>SCA</strong> Forest & Timber<br />
A complete ‘cradle to cradle’<br />
loop, from forest to package<br />
and recycle to fibre again<br />
<strong>SCA</strong> Containerboard<br />
Our Customers<br />
<strong>SCA</strong> Packaging<br />
We lifecycle!<br />
CMD <strong>2011</strong>
Strategic priorities<br />
23<br />
� Focus <strong>capital</strong> on profitable segments<br />
� Increase value content<br />
Ongoing priorities<br />
� Managing the Cycle<br />
& Lowering cost base - Price management<br />
- Eliminate problem businesses<br />
- LEAN project<br />
� Integrate the business - One Company<br />
- Paper Supply Platform<br />
� Customer focus - Quality and Service<br />
- Innovation<br />
� People - Management of change<br />
- Leadership<br />
CMD <strong>2011</strong>
Base Index used Q4 2009<br />
Managing the cycle<br />
Corrugated Box Price Recovery<br />
1.25<br />
1.20<br />
1.15<br />
1.10<br />
1.05<br />
1.00<br />
0.95<br />
24<br />
1.02<br />
1.02<br />
1.00<br />
Achieved price increases of 21% since Q4 2009<br />
1.02<br />
1.06<br />
2009-Q2 2009-Q3 2009-Q4 2010-Q1 2010-Q2 2010-Q3 2010-Q4 <strong>2011</strong>-Q1 <strong>2011</strong>-Q2<br />
1.11<br />
Price Corrugated Conventional<br />
1.14<br />
1.17<br />
1.20<br />
CMD <strong>2011</strong>
Business integration<br />
Paper supply platform<br />
25<br />
CMD <strong>2011</strong>
Customer Focus<br />
Quality & Service<br />
26<br />
Quality Award<br />
CMD <strong>2011</strong>
Innovation<br />
Strengthens customer offering<br />
27<br />
CMD <strong>2011</strong>
<strong>SCA</strong> Forest Products<br />
Ulf Larsson, President<br />
28<br />
CMD <strong>2011</strong>
<strong>SCA</strong> Forest Products<br />
Forest<br />
Europe’s largest private forest owner<br />
2.6 million hectares<br />
29<br />
Solid-wood products<br />
No. 2 in Europe<br />
Pulp<br />
R&D<br />
Sales: SEK 17.1bn<br />
Employees: 4,200<br />
Publication papers<br />
No. 5 in Europe<br />
Distribution and logistics<br />
Energy<br />
CMD <strong>2011</strong>
Publication papers<br />
Strategic focus<br />
Strong<br />
mill concept<br />
Deliveries<br />
� Maintenance<br />
organization<br />
� Productivity and<br />
cost efficiency<br />
Priorities<br />
� Upstream<br />
integration<br />
� Productivity and<br />
cost efficiency<br />
30<br />
Higher<br />
product value<br />
� Strategy defined<br />
� Less exposure to<br />
standard news<br />
Strengthened<br />
<strong>market</strong> position<br />
� Full capacity<br />
utilization<br />
� Environmental<br />
positioning<br />
� Local presence and<br />
good service<br />
� Further strengthen<br />
core European<br />
customer base<br />
Innovation<br />
products/<br />
processes<br />
� New R&D agenda<br />
� Long term product<br />
development per<br />
mill<br />
� Supplementary<br />
products<br />
CMD <strong>2011</strong>
Publication papers<br />
Deliveries of FSC-certified paper<br />
31<br />
tonnes<br />
300,000<br />
250,000<br />
200,000<br />
150,000<br />
100,000<br />
50,000<br />
0<br />
FSC deliveries increased 35% in 2010<br />
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010<br />
CMD <strong>2011</strong>
Solid-wood products<br />
Strategic focus<br />
Asset optimization<br />
program<br />
Deliveries<br />
� Bollsta 450,000 � 550,000 m³<br />
� Tunadal 350,000 � 500,000 m³<br />
� Closure Stugun<br />
Priorities<br />
� Internal consolidation<br />
32<br />
Industrial and<br />
distribution<br />
solutions<br />
� GORM start-up<br />
� BM Scandinavian<br />
expansion (+60%)<br />
� China sales company<br />
� BM France<br />
� BM UK<br />
To<strong>day</strong><br />
Vilhelmina<br />
Jämtlamell<br />
Gällö<br />
Munksund<br />
Holmsund<br />
Rundvik<br />
Bollsta<br />
Tunadal<br />
Tjärnvik<br />
CMD <strong>2011</strong>
Solid-wood products<br />
Increased share of value-added products<br />
%<br />
60<br />
50<br />
40<br />
30<br />
20<br />
10<br />
0<br />
38%<br />
Value-added products<br />
52%<br />
2004 2005 2006 2007 2008 2009 2010<br />
33 CMD <strong>2011</strong>
Pulp<br />
Strategic focus<br />
Pulp<br />
Deliveries<br />
� Increased productivity<br />
� Lime kiln<br />
� Maintenance organization<br />
Priorities<br />
� Östrand 475,000 tonnes<br />
34<br />
To<strong>day</strong> Potential<br />
Tonnes/<br />
annum<br />
420,000<br />
NBSK<br />
475,000<br />
800,000<br />
CTMP<br />
90,000 90,000 90,000<br />
CMD <strong>2011</strong>
Forest<br />
Strategic focus<br />
Forest<br />
Deliveries<br />
� Growth<br />
� Increased productivity<br />
� Purchase from private forest<br />
owners >3 million m³<br />
Priorities<br />
� Decreased costs<br />
� Further increased purchase<br />
volume to cover industry<br />
expansion<br />
� Forest growth<br />
35<br />
Million m³ standing volume<br />
300<br />
250<br />
200<br />
150<br />
100<br />
50<br />
0<br />
Measured<br />
To<strong>day</strong><br />
Forecast<br />
1947 1953 1968 1976 1984 1996 2006 2016 2026 2036 2046 2056<br />
CMD <strong>2011</strong>
Forest<br />
A valuable asset<br />
� Europe’s largest private forest owner – FSC certified<br />
� Annual net growth of 1%<br />
� Raw material integration and potential for electricity generation<br />
� Our forests absorb as much carbon dioxide as is discharged from <strong>SCA</strong>’s<br />
entire production<br />
� If the worlds forests were managed the same way as <strong>SCA</strong>’s that would<br />
solve a big part of the climate change problem<br />
36 CMD <strong>2011</strong>
Energy<br />
Strategic focus<br />
Wind power Biofuel New energy<br />
products and<br />
processes<br />
Deliveries<br />
� Statkraft investments, 2.6 TWh<br />
� Fred. Olsen Renewables, 2 TWh<br />
� Organization<br />
� Strategy<br />
37<br />
Priorities<br />
� <strong>SCA</strong> projects<br />
� Land lease<br />
� Further investments<br />
Statkraft joint venture<br />
� Ongoing business<br />
� >4 TWh biofuel,<br />
potential 12-15 TWh<br />
� Peat, prestudy<br />
� Strategic partners<br />
� Organization<br />
� Strategy<br />
� Pre-study torrefaction<br />
CMD <strong>2011</strong>
R&D and Innovations<br />
Strategic focus<br />
R&D<br />
Deliveries<br />
� R&D Transformation program<br />
- Reduce TMP energy consumption<br />
- Next generation publication papers<br />
- Bio-refinery mechanical pulp<br />
- Composites<br />
- Future packaging products<br />
- Micro fiber cellulose<br />
� Innovation/business development<br />
- Process started for higher ambition level<br />
Priorities<br />
� Innovation culture<br />
- 72 hour race to innovation<br />
� Production system for innovation/<br />
business development<br />
38<br />
CMD <strong>2011</strong>
<strong>SCA</strong> Hygiene business<br />
Mats Berencreutz, COO Hygiene Operations<br />
Christoph Michalski, President GHC<br />
39 CMD <strong>2011</strong>
Strong global and regional brands<br />
Two global billion EUR brands<br />
North America<br />
Latin America<br />
Europe<br />
Eastern Europe<br />
Asia Pacific<br />
Sales of SEK 65bn, with sales in more than 100 countries<br />
40 CMD <strong>2011</strong>
Leading <strong>market</strong> positions<br />
Global and regional<br />
North America<br />
AFH tissue: 3<br />
Incontinence care: 3<br />
Mexico<br />
Incontinence care: 1<br />
Tissue: 2<br />
Feminine care: 1<br />
Baby diapers: 3 Global<br />
Colombia<br />
Incontinence care: 1<br />
Feminine care: 1<br />
Tissue: 1<br />
41<br />
Europe<br />
Tissue: 1<br />
Baby diapers: 2<br />
Incontinence care: 1<br />
Incontinence care: 1<br />
AFH tissue: 2<br />
Australia<br />
Feminine care: 1<br />
Incontinence care: 1<br />
Tissue: 2<br />
CMD <strong>2011</strong>
Strategic focus<br />
� Strengthen positions and increase growth in<br />
main <strong>market</strong>s and emerging <strong>market</strong>s<br />
� Increase the number of global brands<br />
� Increase the pace of innovations<br />
� Efficiency improvements<br />
42<br />
CMD <strong>2011</strong>
Growth potential for hygiene products<br />
� Global population growth<br />
� An aging population<br />
� Increased <strong>market</strong> penetration<br />
� Higher disposable income<br />
� Customers and consumers demand<br />
more comfort and sustainability<br />
Global <strong>market</strong> size for hygiene products: SEK 675bn<br />
43<br />
CMD <strong>2011</strong>
Population growth 2010-2020<br />
Demographics<br />
44<br />
People, millions<br />
8 000<br />
7 000<br />
6 000<br />
5 000<br />
4 000<br />
3 000<br />
2 000<br />
1 000<br />
0<br />
+12%<br />
+2%<br />
World Children 0-4<br />
yrs<br />
2010 2020<br />
,<br />
+7%<br />
Women 15-49<br />
yrs<br />
+33%<br />
+11%<br />
>65 yrs Other<br />
CMD <strong>2011</strong>
Growth<br />
High potential in <strong>market</strong>s with low penetration<br />
Penetration<br />
in mature<br />
<strong>market</strong>s<br />
around 35%<br />
45<br />
Usage of hygiene products<br />
Units/capita/year Units/child/year Units/woman/year<br />
North America<br />
Kg/capita/year<br />
Western Europe Eastern Europe Latin America Asia<br />
CMD <strong>2011</strong>
Sustainability as a business driver<br />
�Extensive customer and consumer<br />
demand for sustainable solutions and<br />
eco labelling<br />
�Growing sustainability interest in<br />
emerging <strong>market</strong>s<br />
�Great growth potential with<br />
customized offerings in D&E <strong>market</strong>s<br />
�Sustainability drives innovation<br />
46<br />
CMD <strong>2011</strong>
Driving growth and efficiencies<br />
47<br />
Drive Growth Drive Efficiencies<br />
Core<br />
capabilities<br />
� Innovation<br />
� Marketing and<br />
brand<br />
management<br />
� Consumer and<br />
customer insight<br />
Organization<br />
effectiveness<br />
� Faster, simplified<br />
decision making<br />
� Clarified ways of<br />
working<br />
Extract cost to<br />
reinvest for<br />
growth<br />
� Leaner, more<br />
agile organization<br />
� Shift resources<br />
where required to<br />
win<br />
CMD <strong>2011</strong>
Growth<br />
<strong>SCA</strong>’s growth <strong>market</strong>s<br />
48<br />
Latin America<br />
South East Asia<br />
Eastern Europe<br />
/Russia<br />
Middle East<br />
China<br />
� Strong <strong>SCA</strong> positions<br />
� Good <strong>market</strong> growth<br />
� Favourable socio-demographics<br />
� Good <strong>market</strong> growth<br />
� Favourable socio-demographics<br />
� Incontinence care products<br />
CMD <strong>2011</strong>
More Brand, Less Brands<br />
�Harmonized positions to leverage:<br />
� Concepts<br />
� Technology<br />
� Best practice<br />
�Huge opportunity to accelerate growth and further<br />
strengthen efficiencies through improved speed and<br />
scale<br />
49<br />
CMD <strong>2011</strong>
Innovation<br />
Strengthens <strong>market</strong> positions and profitability<br />
50<br />
CMD <strong>2011</strong>
Innovation<br />
Strengthens <strong>market</strong> positions and profitability<br />
51<br />
CMD <strong>2011</strong>
<strong>SCA</strong> Tissue Europe<br />
Magnus Groth, President<br />
52 CMD <strong>2011</strong>
<strong>SCA</strong> Tissue Europe<br />
� Net sales of SEK 26.8bn<br />
� 9,200 employees<br />
Consumer tissue<br />
� No. 1<br />
� 25% <strong>market</strong> share<br />
AFH tissue<br />
� No. 1<br />
� 20% <strong>market</strong> share<br />
AFH<br />
tissue 25%<br />
Sales split<br />
Consumer<br />
tissue 75%<br />
53 CMD <strong>2011</strong>
Strategic focus<br />
� Continue to strengthen the Tork brand in AFH<br />
tissue and increase growth<br />
� Strengthen consumer tissue brands through<br />
continued implementation of the brand platform<br />
� Launches of innovative products based on<br />
customer and consumer insight<br />
� Efficiency improvements<br />
� Sustainability as a business driver<br />
� Capture growth opportunities in Eastern Europe<br />
54<br />
CMD <strong>2011</strong>
Consumer tissue<br />
� Finalized brand migration from P&G deal<br />
� Strengthened brand positions<br />
� Increasing share of branded business<br />
� Improved price management<br />
� Strong growth in Eastern Europe<br />
55<br />
CMD <strong>2011</strong>
AFH tissue<br />
� Increasing <strong>market</strong> share, especially in HoReCa*<br />
segment<br />
� Continued growth in highly profitable premium<br />
segments<br />
� Focus on strategic growth regions has paid off<br />
� Improved price management<br />
During <strong>2011</strong> <strong>market</strong> share has exceeded 20% (+1% compared to 2010)<br />
* Hotels, Restaurants and Catering<br />
56<br />
CMD <strong>2011</strong>
Consumer tissue brand migration<br />
Stronger brands and more efficient A&P<br />
57<br />
Complicated, region specific,<br />
inefficient brand portfolio<br />
DACH East<br />
Nordic NL<br />
From …<br />
Focused, differentiated & consumer<br />
relevant mega-brand portfolio<br />
… To<br />
CMD <strong>2011</strong>
Innovation<br />
Strengthens <strong>market</strong> positions and profitability<br />
58 CMD <strong>2011</strong>
Sustainability as a business driver<br />
� Increased customer demand, both from consumer<br />
and B2B<br />
� Increased demand for eco-labelling<br />
� 90 Tork products received the EU<br />
Eco-label<br />
� Several tenders secured thanks to green<br />
credentials, i.e. Wembley stadium<br />
59<br />
CMD <strong>2011</strong>
<strong>SCA</strong> Personal Care Europe<br />
Thomas Wulkan, President<br />
60 CMD <strong>2011</strong>
Personal Care Europe<br />
� Net sales of SEK 16.9bn<br />
� 5,300 employees<br />
Incontinence care<br />
� No. 1<br />
� 41% <strong>market</strong> share<br />
61<br />
Baby diapers<br />
� No. 2<br />
� 12% <strong>market</strong> share<br />
Feminine care<br />
� No. 3<br />
� 8% <strong>market</strong> share<br />
Feminine care<br />
12%<br />
Baby diapers<br />
28%<br />
Sales split<br />
Incontinence<br />
care 60%<br />
CMD <strong>2011</strong>
Strategic priorities<br />
� Grow TENA to >50%<br />
� Grow Libero and Libresse strongholds<br />
� Build Retailer brand partnerships with<br />
selected leading retailers<br />
� Establish new strongholds in nearby D/E<br />
<strong>market</strong>s<br />
� Cost, quality and service leadership<br />
62<br />
CMD <strong>2011</strong>
Grow TENA to >50%<br />
� Drive and shape <strong>market</strong>s by enhanced<br />
innovation and speed-to-<strong>market</strong><br />
� Strengthen TENA brand<br />
� Accelerate TENA premium growth<br />
� Growth momentum with TENA Pants<br />
� TENA Lady assortment<br />
� Modern Inco Care launch<br />
� Profitable growth in value segment<br />
63<br />
CMD <strong>2011</strong>
Grow Libero and Libresse strongholds<br />
� Libero Nordic<br />
64<br />
� Introduce and grow adjacent products<br />
� Successful Thin Open diaper launch<br />
� Profitable growth for Libero Russia<br />
� Focus on prioritized feminine care <strong>market</strong>s<br />
� Market share gains in Scandinavia and France<br />
CMD <strong>2011</strong>
Build Retailer brand partnerships<br />
with selected leading retailers<br />
� Clear strategy<br />
� Partnerships with selective non-competing retailers<br />
� Fast-follower in Open diapers; Leader in Pants<br />
� Dedicated organization<br />
� Capability to follow the <strong>market</strong> leader quickly<br />
� Strong cost focus<br />
� Early successes<br />
� Supplier of the year award with Kruidvat<br />
� Exceptional growth with Mercadona<br />
� Won new retailer business and several<br />
new Pant contracts<br />
65<br />
CMD <strong>2011</strong>
Establish and grow new strongholds<br />
in nearby growth <strong>market</strong>s<br />
� Capitalize on growth opportunities in Middle East<br />
and North Africa<br />
� Expanded footprint in prioritized growth <strong>market</strong>s<br />
� Komili, Turkey<br />
� San Saglik, Turkey<br />
66<br />
CMD <strong>2011</strong>
Innovation<br />
Strengthens <strong>market</strong> positions and profitability<br />
67<br />
CMD <strong>2011</strong>
Sustainability as a business driver<br />
� Increased customer demand, both from consumer and B2B<br />
� Increased demand for eco-labelling<br />
� Community-related activities for improved brand awareness<br />
68<br />
CMD <strong>2011</strong>
69<br />
<strong>SCA</strong> Americas<br />
Sune Lundin, President<br />
CMD <strong>2011</strong>
<strong>SCA</strong> Americas<br />
� Net sales of SEK 16.1bn<br />
� 7,900 employees<br />
70<br />
North America<br />
� Incontinence care<br />
� AFH tissue<br />
Mexico and<br />
Central America<br />
� Incontinence care<br />
� Baby diapers<br />
� Feminine care<br />
� Tissue<br />
South America<br />
� Incontinence care<br />
� Baby diapers<br />
� Feminine care<br />
� Tissue<br />
Feminine<br />
care 10%<br />
Incontinence<br />
care 21%<br />
Consumer<br />
tissue 18%<br />
Sales split<br />
Baby<br />
diapers 4%<br />
AFH<br />
tissue 47%<br />
CMD <strong>2011</strong>
North America<br />
Strong <strong>SCA</strong> <strong>market</strong> positions<br />
> World’s largest <strong>market</strong> for incontinence care products (USD 2.7bn)<br />
and Away from Home tissue (USD 5bn)<br />
> 90% B2B focus for <strong>SCA</strong><br />
> Strong <strong>market</strong> positions<br />
71<br />
CMD <strong>2011</strong>
Latin America<br />
Strong <strong>market</strong> growth<br />
72<br />
> Fast growing <strong>market</strong>s<br />
> 90% B2C focus for <strong>SCA</strong><br />
> Strong brands<br />
> Unique strength in growing Traditional Trade channel<br />
CMD <strong>2011</strong>
Sales & distribution<br />
Customers<br />
73<br />
CMD <strong>2011</strong>
Strategic Focus<br />
� Leading innovations strengthen <strong>market</strong> positions and<br />
profitability<br />
� Geographic and category expansion<br />
� Increased value added sales<br />
� Sustainability as a business driver<br />
74<br />
CMD <strong>2011</strong>
Leading Innovations<br />
Strengthens <strong>market</strong> positions and profitability<br />
Tork Xpressnap TENA Stretch<br />
Nosotras<br />
Doubles<br />
75 CMD <strong>2011</strong>
Geographic & category expansion<br />
Latin American acquisitions strengthens presence<br />
76<br />
Algodonera Aconcagua<br />
� No. 3 in feminine care<br />
� Smaller positions in baby diapers<br />
and incontinence care products<br />
Copamex<br />
� No. 3 in baby diapers<br />
Pro Descart<br />
� No. 2 in incontinence care products<br />
� Smaller position in baby diapers<br />
CMD <strong>2011</strong>
Increased value added sales<br />
Drives profitability for AFH tissue North America<br />
77<br />
100%<br />
80%<br />
60%<br />
40%<br />
20%<br />
0%<br />
9%<br />
29%<br />
2005 2010<br />
CMD <strong>2011</strong>
Sustainability as a business driver<br />
� Growth potential in Latin America in low income segments<br />
� Smaller packs, local distribution and economy products<br />
� Cooperation with Wal-Mart’s Bodega Aurrera stores in<br />
Mexico<br />
� Customers view <strong>SCA</strong>’s strong sustainability position as a<br />
competitive advantage<br />
� <strong>SCA</strong> offers Ecologo and Green Seal certified Tork<br />
products made of 100% recycled fiber<br />
� Unique “Go Green” partnership with Philadelphia Eagles,<br />
NFL’s greenest football team<br />
78<br />
CMD <strong>2011</strong>
79<br />
<strong>SCA</strong> Asia Pacific<br />
Ulf Söderström, President<br />
CMD <strong>2011</strong>
<strong>SCA</strong> Asia Pacific<br />
� Net sales of SEK 6.9bn<br />
� 3,200 employees<br />
Hygiene Australasia Hygiene North Asia<br />
� Incontinence care<br />
� Baby diapers<br />
� Feminine care<br />
� Tissue<br />
� Incontinence care<br />
� Tissue<br />
Hygiene Central<br />
& South Asia<br />
� Incontinence care<br />
� Baby diapers<br />
� Feminine care<br />
Incontinence<br />
Care 15%<br />
Baby<br />
diapers 23%<br />
Feminine<br />
Care 10%<br />
Sales split<br />
Consumer<br />
tissue 36%<br />
AFH tissue<br />
16%<br />
80 CMD <strong>2011</strong>
Strategic focus<br />
� Geographic and category expansion<br />
� Capture growth opportunities in prioritized emerging <strong>market</strong>s<br />
� Innovation drives penetration, growth and profitability<br />
� Sustainability creates a competitive advantage<br />
� Capitalize on strong brand portfolio<br />
81<br />
CMD <strong>2011</strong>
Asia Pacific<br />
Intimate Health and Elderly Care<br />
By 2030 60% of the<br />
global population<br />
above 65 will be in Asia Pacific<br />
TENA – Undisputed global leader in Inco<br />
Source: SMV, <strong>SCA</strong>, 2010<br />
82 CMD <strong>2011</strong>
Innovation<br />
Strengthens <strong>market</strong> positions and profitability<br />
83 CMD <strong>2011</strong>
Sustainability as a business driver<br />
� Growth potential in low income segments<br />
� Single packs, economy segment<br />
� TENA launch and incontinence care training<br />
of 5,000 nurses in China<br />
� TENA launch in the economy segment in<br />
Vietnam in <strong>2011</strong><br />
� Several tenders secured thanks to green<br />
credentials, i.e. Starbucks in China and<br />
Scott base in Antarctica<br />
84 CMD <strong>2011</strong>
85<br />
<strong>SCA</strong><br />
Jan Johansson, President and CEO<br />
CMD <strong>2011</strong>
Summary<br />
Short-term<br />
� No impact from debt crisis<br />
� Good demand in all Business areas<br />
� Raw material prices slightly down<br />
� Price increases<br />
Long-term<br />
� Strengthen positions in main <strong>market</strong>s and increase growth in<br />
emerging <strong>market</strong>s<br />
� Increased pace of innovations<br />
� Fewer local brands and increased number of global brands<br />
� Continued efficiency improvements<br />
86 CMD <strong>2011</strong>
Johan Karlsson, VP Investor Relations<br />
Tel: +46 8 788 51 30<br />
IR Contacts:<br />
Email: ir@sca.com Website: www.sca.com<br />
Jessica Ölvestad, Manager Investor Relations<br />
Tel: +46 8 788 52 82<br />
87 CMD <strong>2011</strong>
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