Seb Sa Unsp/Adr

Ladies and gentlemen, thank you for being with us to attend the presentation of Group SEB's 2022 full-year results. I will be taking you through those results together with Nathalie Lomond, our Chief Financial Officer, and I will be following the We will look at the key operational highlights for 2022, the key ESG highlights, then we'll look at financials, and we will finish with an outlook to 2023 and beyond. Right, as way of introduction, a reminder of our key figures that were published yesterday in our press release. Sales at close to €8 billion minus 4.7% like for like. Offer at €620 million for the full year lending and offer margin at 7.8%. And adjusting a bid of €874 million minus 16% year on year. And a net profit at €316 million. CAPEX stood at €345 million, 4.3% of sales. We landed our inventories at €1.682 billion, 21% of sales. Our net financial debt stands at 1.973 billion euros, giving a leverage of 2.3 times. And last, the board of directors, we've proposed to the May General Assembly a dividend of 2.45 euros per share, stable versus 2021. Of course, Nathalie will come back to those numbers, but before going into that, I'd like to remind all of us what is the group's main strategic drivers. The first driver is a multi-category, multi-activity strategy. Groupe SEB is operating in around 80 product families, split between cookware, kitchenware, split between kitchen electrics, either electrical cooking or food preparation. We have a strong division in home and personal care. And last, we expanded since the acquisition of VMF Scherer back in 2016 into the professional business. So the first key pillar of the strategy is a multi-category, multi-activity portfolio. The second key pillar is we have a multi-brand approach. We have four kinds of brands. We have consumer international global brands. You will all know Tifal, Croups, Roventa, Bullinex, which are those international global brands. We have some pretty strong local brands. Supor is the biggest one of them. Supor is our brand in China, main brand in China. But we also have Arno in Brazil or Imusa in Colombia. We have a portfolio, a growing portfolio of premium brands with VMF, Lagostina, and Outlad in the United States. And more recently, we've acquired professional brands with WMF, of course, and Scherer. but also the acquisition of Curtiss back in 2018 in the U.S., Crampus 2020, Zumo last year, and La San Marco very recently. The third pillar of the strategy is a multi-country strategy. We have a very balanced geographical portfolio. We do a third of our sales, 35% in Western Europe, which is the homeland of most of the activities of the group. We've developed over the last 15 years a very strong business in China, which now weighs 27% Our third region is North America with 13%, other EMEA 13%, and then other Asia 8%, South America 4%. We're operating in 150 countries, and what is a bit more specific about CEM is that we have leadership positions or one or two positions in over 75% of our sales portfolio. The fourth element of our strategy is a multi-channel strategy. We believe that our consumers should be allowed to reach our products as and where they want in all kinds of distribution channels. So our historical channels, mass retail, traditional or electrospecialists are still the more important part of the group sales. We have developed in the last 15 years a group owned retail activity. We have some other channels with department stores and of course what has been developing steadily, fastly in the last 5 to 10 years is the online sales and I'll come back to that to share the developments in 2022 on that front. Moving on to 2022, I will take you through what has gone on in terms of products, in terms of brands, in terms of international expansion, in terms of distribution, and in terms of investments towards increased competitiveness of the group. Starting immediately with products. Products and innovation are the heart and soul of our business and our industry. And we have very simple and straightforward priorities in consumer. We see massive expansion potential in consumer small electric appliance. through new functionalities that improve consumers' well-being, that makes simpler products, better products, more capabilities. That is something that is working and will be working. We also work on the consumer experience from purchase to the end of life of the product and I would also dare to say beyond the end of life of the product more and more. We work on consumers' engagement based on a best-in-class understanding of their behavior and data collection. More and more, we try to anticipate and meet consumers' needs pre-, during-, and post-purchase through an understanding of the way they behave with the products. And last, and again, that's maybe a point of differentiation, we do that with an ethical and sustainable approach. As far as professional is concerned, we have, as you know, a very large range of full automatic coffee machines that is developing and that's basically aiming at offering the best service and the best product for our consumers and our customers. Now moving into a bit more specifics for 2022, what happened. Maybe the starting point is to talk about OLS Friars. OLS Friars is a major growth driver in 2022, merci. And the sales of this category for us has just multiplied by four in the course of the last three years. On this picture, you see that we operate oil-less fryers under all our brands. Tifal, of course, as an international product. Arnaud in Brazil, Imusa in Colombia are key brands for oil-less fryers. Second thing we've been doing very consistently is the continued international rollout of our best-selling products. We developed ourselves very substantially in versatile vacuum cleaners in the last five to 10 years, and the growth in the last three years have been 70%. We have developed and traded up the Cookeo range with the Cookeo Touch that is now 30% of Cookeo sales, twice as much as it was in 2020. and even on more staple innovations like Ingenio Merci. Like different Ingenio, the stackable cookware, we've reached new heights with 25% plus penetration in our top two markets, Japan and France, which shows somewhat the potential of this category and this market segment. We have launched successfully some new products. We have a very great range of kitchen knives with the Black Knives Collection from VMF that was launched late last year. We've developed and expanded infrared technology rice cookers in China. Rice cooker is a massive category in China, as you expect, around 15 million pieces sold every year. And those infrared technology rice cookers now weigh up to 12% of sales, total rice cooker sales in China. which is a very, very strong result. And last, we're expanding our range of cookware through new coatings, ceramic being one, and we are expanding rapidly ceramic coating pans and pots on the T5 brand. Last but not least, of course, we've introduced last year the VMF Perfection that is already available in over 1,000 Unsp-Adr That is for consumers. For professional coffee, we have a very strong momentum in machines development. We cover a wide range of products from the 9000 Hess, which is the kind of Rolls Royce that makes hundreds of coffees in the same day, to smaller models. And we have the VMF Barista on the bottom right, which is a machine that looks and feels like a barista machine, but gives the convenience and practicality of a fully automatic coffee machine. Scherer also has a very strong product activity. Top right corner, you see the Scherer sole machine that is a new launch for this year. On the top right, you see the showroom of Scherer in Zurville in Switzerland. And we've also put your picture of Luckin Coffee. Luckin Coffee is the number one coffee shop chain in China. They have over 8,000 outlets, and we are a preferred supplier of coffee machines. in that banner, so a very strong development of Scherer. And last, I cannot finish on that part without mentioning our latest acquisitions. We acquired last summer Zumo, which is a Spanish-born company in Valencia, which is the global leader in juice extraction machines, expanding its business in Spain, of course, but also France. You see those machines typically in supermarkets or in small convenience shops. And most, most, most, most, most recently, we've acquired an Italian company called La San Marco. Italy is a country close to my heart, as some of you may know. La San Marco is a traditional coffee machine maker. They are based in Provincia di Gorizia in northeastern Italy. They are manufacturing and marketing traditional coffee machines. Over a hundred years of existence, marked by innovations, they are the leaders in the traditional leather coffee machines, leather-operated coffee machines. They have exclusive patents and trademarks on that. They turn over around 20 million euros, half of that out of Italy. They have close to 100 employees. It's a very, very nice complement to a portfolio of professional coffee machines, and we are delighted to welcome the San Marco employees into Group 7. We've worked a lot in 2022 in developing our brand portfolio and as Supor has passed the 2 billion euros mark, we now can say that we have over 2 billion euros brands in the group. Supor and Tefal. Tefal is the most international brand of the group. Supor is very Chinese. Both brands operate on a very large variety of categories, cookware but also Kitchen Electrics, Food Preparation, and both brands are a leader in many of the markets they operate in. Beyond Super and Tefal, we have Roventa that is helping us lead the way in categories like home cleaning and linen care. We have Bullinex, who is the number two global brand in food preparation globally. and Ulinex, that was born and developed in France and Western Europe, is expanding across that geography. We have IMUSA, which I mentioned. IMUSA is our leading brand in Colombia. It's the number one brand in Colombia, operates in both cookware, kitchenware, and kitchen electrics, food preparation in particular. IMUSA is a key pillar of our brand development in Colombia. This is one we like particularly. Seb, which is the origin of the group. And we've taken this picture because today, or this year, is the 70th anniversary of the production of the first pressure cooker in the Seb factory in Solanger. We produce over 50 million pressure cookers in that factory. We still produce them. And Seb is one of those very strongly rooted local brands that populate the portfolio of brands of the group, and that is A very nice complement to our portfolio. Then we have, as a reminder, All-Clad, number one premium brand in cookware in the United States, probably the most premium cookware brand in the world. We have WMF, which is, again, also born in cookware, born in Germany, but that is expanding as All-Clad into a kitchen matrix. You see a steam cooker under WMF brand, very beautifully designed products. And as a reminder, we have this fantastic Italian jewel called Lagostina, which is one of our preferred premium brands. Very different distinctive assets and values for this brand. So very strong and dynamic brand portfolio. A lot of things happening on that front. We've also worked very hard in 2022 to enhance our international presence. And I will cover three parts, maybe starting with a deep dive on China. China is an ongoing success story for the group. We've reached, in 2022, sales of €2.1 billion, 5% up on last year, like for like. But if we step back, our sales in 2006 were €145 million. That means, I spare you the calculation, 15 times growth in 16 years. We can say that it's a pre-established success story. Supor is a very strong brand in China, enjoys 84% brand awareness. And if we dig into what happens, what goes on, and how we got there, well, we've reached number one position. This is breaking news. This is breaking news. We've reached number one position across all our categories in Kitchen Electrics in China, both online and offline. We were number one online, not offline. Now it's done. with 25% market share, and that is driven through innovation. 40% of our kitchen electric sales are made on new products every year in China, so a very, very strong product. You'll see beautiful products. You'll see coverage of different categories of products, which is vast and growing. So that's the first element is our success in kitchen electrics and the growth We've been able to generate in kitchen electrics. The stronghold of support was originally into cookware. We have maintained a very high share position. We have 35% share in cookware in China, leader, of course, in online and offline. And again, that's driven by wide range coverage, the ability to cover all price points, innovation. You see some material innovations on the left side of the corner. So the first pillar of the success of support in China is its product portfolio and its ability to innovate. This success is also based on a highly competitive manufacturing base. We have five state-of-the-art plants in support in China, plus one in Vietnam. We have a capacity of more than 150 million units production capacity. We serve the local Chinese market and we serve the international markets through these production capacities and this is a very, very, our 10,000 employees are a very strong support to the development of the business. And maybe the last point I would like to highlight is a remarkable ability of our teams in support to access and adapt to very fast-changing market conditions. You will have followed our ventures in China to realize that over 70% of our sales now are online, and our online distribution picture moves very fast. We have marketplaces, we have social networks that become We're using over 2,300 influencers to help us day in, day out do that. We are penetrating the on-to-off stores. Now, what is an on-to-off store? It's a store that has been created by Tmall, Alibaba, or Jingdong. Le film s'il vous plaît?

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All right, so support is clearly a big success and 2022 is another record year for this company, but not only. Sorry, I'm moving too fast. We also have some blossoming markets. We've taken three out of our top 22, Colombia, Mexico and Poland, that are all part of our top 20 countries, that all post double-digit growth consistently over the last three years, that have reached number one position in cookware, number two in SDA. And that's to say that the group geographical strategy is also made of, yes, big countries, but also the ability to penetrate and grow our business in smaller countries that are bound to become bigger markets for us. Do it through strong local or global brands. We do it through products which are designed to match local consumer habits and needs. Category Range Extensions, and those countries now significantly contribute and support the growth of the group. Another key element of the geographical development of the group has been in the professional business. When we acquired Scherer and WMF, they were majority sold in Germany and Switzerland. And we see a few years later a much more balanced portfolio with North America, Europe, and Asia sharing pretty comparable stakes of the business. Asia is a bit behind. Europe is still a bit ahead. But the international expansion of the coffee business is clearly there with some specifics in China. In Asia, we are pushed and helped a lot by Luckin Coffee, which is our number one customer. We have a strong rebound in the US with Wilbur Curtis, which is a nice addition to the Scherer brand that allows us to expand and widen our customer's portfolio. In Germany, Switzerland, Austria, we've been able to see a strong acceleration, both of VMF and Scherer, and that growth is driven both by machine sales and service, which is also something we are very interested in. We've developed substantially our distribution in the last year or so. Online sales now represent over 40% of our total sales. Of course, when we speak and talk online, we think of pure players, Amazon type, or click and mortar like Darty, darty.com, boulanger.com, mediamart.com. We have expanded in the last year our presence on marketplaces in China and beyond China. And we are more and more expanding our direct-to-consumer capabilities. We have developed in the last three years 70 brand.com websites. Brand.com website can be, for instance, Roventa.fr or Tifal.uk. We have 70 of those. We received 55 million visitors on our websites last year and we have 20 new store opening in the Seoul 2022. So a growing business, a growing capability that allows us to give our consumers access to our products as and when they visit us. We've also used 2022 to keep investing and developing our competitiveness. Our industrial footprint comprises over 40 factories between France, Germany and Asia. This is a global portfolio of factories that has allowed us to maybe serve or be a bit more immune to out-of-stock issues or supply issues in the last two years. Having our own manufacturing footprint and setup allows us to secure the supply chain in a moving environment. That's a euphemism. And we are currently increasing our investments in Egypt, in Czech Republic, in Vietnam and in Colombia. to diversify our sourcing bases that allows us to improve diversification, that allows us to improve our agility and global competitiveness. You will have seen, I won't come back to that, that we are reorganizing our activities in Germany, putting together the sales activity of EMF and SEB in DACH. That plan is currently being discussed with Social Partners, and we should hopefully reach a conclusion and move into execution in January 2024. And maybe the last point on that one is we've been investing to optimize our supply chain and our distribution That was for the operational highlights. I thought it useful to remind ourselves and to look at what have been the achievements in the environment, social and governance matters. Starting with the carbon neutrality trajectory, we aimed that by 2050 and we've reduced at the end of 2022 by 30% our carbon intensity In scope one and two, that is mainly our plants, starting from the base of 2016. So we are on track to achieve our objectives of 2023 on that matter. The second point I'd like to share is the focus on circular economy. We've been talking a lot in the last years of those two matters. We have today 90% of our small domestic appliance products out of China which are repairable for 15 years. We hold inventory of pièces détachées spare parts in Fauconnier et La Mer in Les Vosges. So we have our own inventory of spare parts for 15 years. We have 42% of recycled materials in our products and packaging. So today, 42% of what you buy is made of recycled material. That's on the environment part. We have a strong activity also on the social part. We've been measuring ourselves in lost time injury rate, that is safety in our setups with factories, logistics centers, or retail stores. We have reached in 2022 a lost time injury rate of 0.84. People say that below one starts to be a very, very good performance. We've reached 0.84, coming from 2.6 back in 2018. We also, being an industrial company, we also look carefully at our women manager ratio, that is the number of women who are managers compared to the number of women in the workforce. Today this ratio is at 95%. That means women are 43% of the staff of the workforce of the group and 41% of our managers. And combining environmental and social matters, we are developing a Reparseb activity. Reparseb is this atelier de reparation, this workshop to repair products that we've opened Port de la Chapelle three years ago in Paris, that is combining repairing and reconditioning products with reintegrating people in the work society. We take people that have no work left and no We bring them back into a professional life. That activity has been recognized by a few rewards. And of course, as these ESG matters are very important, we are being audited and followed by quite a few companies that are providing ratings. Those ratings put us in a very nice position in many instances. The last part of ESG is the G for governance. 2022 has been a very eventful year. After 20 years of tenure as chairman and chief executive officer, Thierry Latour-D'Artes has moved on to become chairman of the board, and the board has appointed me as chief executive officer of the company. It's a very nice way of dissociating the activities between the chairman and the CEO, and we have a great understanding of the respective roles of one and the other. Beyond that, we have created a strategic committee as one of the board committees that started in July 2022, chaired by Thierry Latour-D'Artes, comprising of five board members and its main responsibilities are corporate social responsibility, strategy, M&A and competitive intelligence. And maybe the last point on this ESG is we've increased three times the share of ESG criteria in the variable compensation of the corporate officers and the senior leadership team. Those are quantitative criterias relating to carbon environment, relating to health and safety, and relating to ethics, So, looking at the financials of the company, starting with the sales, in 2022, the group has delivered around 8 billion sales. When compared to 2021, it's a decrease of 1.2%.