REJUVENATING SUSTAINABLE GROWTH - 28th July 2020 - Reckitt Benckiser
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REJUVENATING 28th July 2020 SUSTAINABLE GROWTH
Disclaimer Cautionary note concerning forward-looking statements This presentation contains statements with respect to the financial condition, results of operations and business of RB (the “Group”) and certain of the plans and objectives of the Group that are forward-looking statements. Words such as ‘‘intends’, ‘targets’, or the negative of these terms and other similar expressions of future performance or results, and their negatives, are intended to identify such forward-looking statements. In particular, all statements that express forecasts, expectations and projections with respect to future matters, including targets for net revenue, operating margin and cost efficiency, are forward-looking statements. Such statements are not historical facts, nor are they guarantees of future performance. By their nature, forward-looking statements involve risk and uncertainty because they relate to events and depend on circumstances that will occur in the future. There are a number of factors that could cause actual results and developments to differ materially from those expressed or implied by these forward-looking statements, including many factors outside the Group’s control. Among other risks and uncertainties, the material or principal factors which could cause actual results to differ materially are: the general economic, business, political and social conditions in the key markets in which the Group operates; the ability of the Group to manage regulatory, tax and legal matters, including changes thereto; the reliability of the Group’s technological infrastructure or that of third parties on which the Group relies; interruptions in the Group’s supply chain and disruptions to its production facilities; the reputation of the Group’s global brands; and the recruitment and retention of key management. These forward-looking statements speak only as of the date of this announcement. Except as required by any applicable law or regulation, the Group expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in the Group’s expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based.
Laxman Narasimhan Chief Executive Officer
Key messages
Strong start to 2020 – delivering our strategic plans; tailwind from COVID-19
Global shifts reinforce our strategy, portfolio, purpose and fight
Expanded plan to accelerate growth with higher investment
Organisation, capabilities and culture change well underway to realise opportunity
Reckitt Benckiser Group plc (RB) 3
Agenda
Strategic update
Overview of H1 2020 H1 2020 financial details
and outlook
Reckitt Benckiser Group plc (RB) 4
Overview of H1 2020
In February we presented our growth and investment plans
2019 Medium term
Revenue Growth +0.8% Mid-single digits
Investment • P&L investment of £200m
• £1.3bn enhanced productivity program
£ 2bn •
•
Transformation costs £250m, spread over 2 years
Two years of capex at 4% of net revenue
over 3 years
Earnings Growth +2.8% +7-9% pa
Reckitt Benckiser Group plc (RB) 5
Overview of H1 2020
Strong underlying performance coupled with COVID-19 tailwinds
Adjusted Adjusted Operating
Net Revenue
Operating Profit* Profit Margin*
£6,911m £1,696m 24.5%
+11.9%* +15.0% +90bps
PY: £6,240m
PY: £1,475m PY: 23.6%
Adjusted Earnings
Free Cash Flow* Dividend per share
per Share*
166.5p £1,902m 73.0p
+14.5% +104.7% unchanged
PY: £929m PY: 73.0p
PY: 145.4p
Reckitt Benckiser Group plc (RB) *Refer to adjusted and other non-GAAP measures, definitions and terms presented within the HY 2020 results and Q2 trading statement 6
Overview of H1 2020
Underlying business is getting stronger
Strengthening supply chain performance Strengthening customer execution pre-COVID
Increased capacity for #1 selling disinfecting spray to meet Steady improvement in US product fill rates
US COVID-19 demand – now c.30% of Lysol worldwide
c.+2.5x
Oct 19 Nov 19 Dec 19 Jan 20 Feb 20 Mar 20
June 2019 June 2020
Progress on productivity programme: FY 2020 targets
Traditional productivity Additional planned productivity Total planned productivity On track to deliver against plan
£240M + £103M = £343M 105%
Reckitt Benckiser Group plc (RB) 7
Overview of H1 2020
Consumer behaviour trends through COVID-19
Hygiene and health awareness Pantry loading and unloading Nesting at home
Pantry stocking accounted for
85% 60%
of people have improved their over 40% of Americans are cooking at
hygiene habits since hearing
of US spending on CPG home more due to COVID-193
about the coronavirus1
in March 20202
Decreased social interaction Channel shift Potential economic recession
Worldwide online spending
51%
100+ countries increased 77% of American consumers believe
imposed full or partial lockdowns their finances will be impacted
year-over-year in May4 for 4+ months by COVID-195
1: Toluna survey for RB in April 2020; 4,203 respondents across 17 countries. 2: Under Pressure: COVID-19’s Immediate and Long-term Impact on the
Consumer Packaged Goods Industry. William Blair and IRi. 3: 2020 Food & Health Survey. International Food Information Council. 4: COVID-19
Reckitt Benckiser Group plc (RB) Accelerated E-Commerce Growth ‘4 To 6 Years’. Forbes. 5: Survey: US consumer sentiment during the coronavirus crisis. McKinsey 8
Overview of H1 2020
Our portfolio is well positioned against COVID-19 trends
Description Brands most affected Expected trend
Hygiene and Increased consumption for hygiene Sustained uplift
health awareness products and preventative treatments for our brands
Pantry loading As virus is controlled consumers Loading and unloading to
and unloading start to destock pantries balance out over full year
Lockdowns increasing time at home and Consumption returning to
Nesting at home use of products which maintain the home normal as lockdowns lift
Decreased social Social distancing and lockdowns Consumption returning to
interaction reduce interaction between people normal as lockdowns lift
Shopping has moved online; larger focus Prolonged positive
Channel shift than ever on eCommerce and digital fulfilment All brands effect on eCommerce
Portfolio is well positioned to withstand a potential economic recession
Reckitt Benckiser Group plc (RB) 9Overview of H1 2020
Expanding our plan to accelerate growth
Expanded plan Implications
Reinvesting incremental upside
Optimise investments across the
to grow our leading position with
portfolio to maximise growth potential
Dettol and Lysol
Accelerate eCommerce growth Increase in capital expenditure and shift
through eRB to capture faster some investment into H2 2020 and 2021 to
channel shift – “be big and bold” address increased demand for disinfectants
Build professional category with
Increased confidence in achieving our
strategic accounts – e.g. Hilton, Delta
medium-term goals
Airlines – and enhanced distribution
Reckitt Benckiser Group plc (RB) 10Jeff Carr Chief Financial Officer
H1 2020 financial details
Net Revenue: Strong LFL Sales Growth
Group up 11.9% LFL (10.8% actual)
Overall group COVID-19 impact Underlying growth estimated to
be around 3-4%
13.3%
18.6% Deferred revenue
adjustment 2.9%
Volumes up 11%, Price/Mix up 1%
16.1%
10.5%
11.9% 9-10% 9-10% • Deferral of revenue for goods in
transit: reduces H1 Net Revenue
by £88.5m
3-4% 3-4%
-4.8%
• Total estimated eCommerce sales
up over 60%
Q1 2020 Q2 2020
‐ 12% of HY Net Revenue (H1 2019: 8%)
Group Hygiene Health (excl. IFCN) IFCN COVID-19 Underlying
Reckitt Benckiser Group plc (RB) Growth rates at constant exchange rates 12H1 2020 financial details
Group Margins: Significant leverage benefit to H1 margins
H1 Change
£m
2020 2019 Actual FX Constant FX*
Net Revenue 6,911 6,240 +10.8% +11.9%
Gross Margin % 60.9% 60.2% +70bps
BEI % 13.8% 15.4% -160bps
Other costs % 22.6% 21.2% +140bps
Adjusted Operating Profit (AOP) * 1,696 1,475 +15.0% +15.7%
Adjusted Operating Profit % 24.5% 23.6% +90bps
* Net revenue measured on a like-for-like basis. For further details on all non-GAAP measures please refer to adjusted and other non-GAAP
Reckitt Benckiser Group plc (RB) measures, definitions and terms presented within the HY 2020 results and Q2 trading statement 13H1 2020 financial details
Adjusted Operating Profit Margin Bridge
360bps -310bps
Includes £69m
COVID-19 related costs
+230bps -190bps
24.5%
23.6%
+90bps
H1 2019 Leverage COVID-19 and Productivity Reinvestment H1 2020
Other Headwinds
Reckitt Benckiser Group plc (RB) 14H1 2020 financial details
Productivity Program: On track to deliver productivity target
Building strong trusted relationships to improve costs
Direct Procurement for both RB and our partners (1,355 active projects) £50m
Reducing manufacturing and logistics costs through lean manufacturing
Supply Chain practices and continuous improvement (1,557 active projects) £38m
Reducing cost by improving old designs and consumer products and being more
Design to Value sustainable by leveraging latest technology and insight (762 active projects) £16m
Improved supplier negotiations driven by scale,
Indirect Procurement centralisation and competitive bids (1,216 active projects) £20m
Network / Cost Organisational optimisation and improved return on investment focused on go to market
efficiencies and driven marketing investment decisions (714 active projects) £41m
Optimisation
YTD savings £165m
Reckitt Benckiser Group plc (RB) 15H1 2020 financial details
Hygiene: Strong underlying growth with significant COVID-19
tailwind
Net Revenue Europe / ANZ • Double digit growth in North America,
11.4% Europe / ANZ and most emerging markets
£2,737m
+16.1%* • Strong growth from Lysol, Sagrotan and Finish
PY: £2,402m
• Solid performance from Air Wick, Calgon,
AOP Cilit Bang, Harpic, Mortein and Veja
DvM NA
7.8% 29.1% • Market share performance continued
£687m
recent positive trends
+30.4%
PY: £527m Volume +15% • E-Commerce revenues up over 90%
AOP Margin
Price/Mix +1%
+320bps
Reckitt Benckiser Group plc (RB) All numbers are adjusted to exclude the impact of adjusting items. Net revenue reported on a like-for-like basis 16H1 2020 financial details
Health: Strong underlying growth with significant COVID-19 tailwind
Net Revenue Europe / ANZ • OTC: strong first quarter in North America and
7.2% Europe / ANZ; with second quarter impacted by
£4,174m the effects of pantry unloading and retail volume
+9.3%* reductions
PY: £3,838m
• Other Health: exceptional demand for Dettol (up
AOP DvM NA
around 60%) and VMS; more than offset modest
declines for Durex and Scholl
5.4% 20.8%
£1,009m
PY: £948m • IFCN: Expected slow start in Greater China and
impact of dryer overhaul in Latin America; offset
+6.4% Volume +7% by solid performance in North America
AOP Margin • E-Commerce revenues up over 50%
Price/Mix +2%
-50bps
Reckitt Benckiser Group plc (RB) All numbers are adjusted to exclude the impact of adjusting items. Net revenue reported on a like-for-like basis 17H1 2020 financial details
Adjusted EPS Bridge
31.1p -3.1p Net Finance
-6.3p
-0.6p 166.5p Expense
c.3% of Net Debt
145.4p
Adjusted Tax
expected to
remain c.23%
H1 2019 Adjusted Net Finance Tax Weighted H1 2020
Operating Expense Share
Profit Movement
Reckitt Benckiser Group plc (RB) 18H1 2020 financial details
Free cash flow generation: Strong Free Cash conversion in H1
£m H1 2020 H1 2019 Change Working capital benefit
from negative working
Cash generated from continuing operations 2,582 1,525 1.057
capital position
Less: net interest paid (147) (129) (18)
Less: tax paid (391) (305) (86) Expect FY capital
expenditure c.3.0-3.5%
Less: purchase of property, plant & equipment (114) (131) 17 of net revenue
Less: purchase of intangible assets (32) (50) 18
Plus: proceeds from the sale of property, plant & equipment 4 19 (15) Target strong free
cash flow conversion
Free Cash Flow 1,902 929 973
Free Cash Flow Conversion 160% 90% 70pps
Reckitt Benckiser Group plc (RB) Refer to adjusted and other non-GAAP measures, definitions and terms presented within the HY 2020 results and Q2 trading statement 19H1 2020 financial details
Net Debt
Net Debt June 2020 Gross Debt by Borrowing Gross Debt Maturity Profile
Gross debt £12.8bn
€ & £ Bonds 364 days - CP*
Commercial Paper*
Cash (£2.6bn)
364 days - Bond
Net debt £10.2bn
US$ Bonds
US$
Term
Loan
c.£2bn Bond issued in May 2020
• Euro and Sterling denominated
• Lower usage of commercial paper
5+ years - Bonds
2-5 years - Term Loan
Average Maturity of 5.4 years & Bonds
(previously 4.2 years at 31 Dec 2019)
Reckitt Benckiser Group plc (RB) * Backed by undrawn committed bank facilities totaling £5.5bn and maturing in 2-4 years 20H1 2020 financial details
Disciplined capital allocation continues to be key priority
Invest in operations to drive growth and maximise returns on investment
Remain focused on delivering strong free cash conversion
Sustain dividend pay-out at 2019 levels. Interim dividend declared at 73.0p
Target single A rating
Rigorously manage portfolio
Reckitt Benckiser Group plc (RB) 21Laxman Narasimhan Chief Executive Officer
Strategic update and outlook
In February we set out a clear strategic agenda
Good house, great neighbourhood, potential to be a great house
Clear strategy to rejuvenate growth
Investment plan and productivity to deliver growth
Sustainable, long-term value, while engaging with purpose
Leading and inspiring the people of RB to succeed
Reckitt Benckiser Group plc (RB) 23Strategic update and outlook
Global mega-trends trends further reinforced by COVID-19
Urbanisation and Growing demand Sexual Growing and ageing Technology
global warming for Self Care health crisis population proliferation
Digital and
Hygiene Health Nutrition
eCommerce
Dense populations drive Government pressures Increased need for
Demand for adult Digital transforming
need for good hygiene on healthcare costs prevention and fun
nutrition creating what people buy and
as the foundation of creating opportunity driving opportunities
opportunities how they buy it
health in Self Care in Sexual Well Being
Solutions must be sustainable for the planet and society
Reckitt Benckiser Group plc (RB) 24Strategic update and outlook
Three spaces – well positioned for growth
Hygiene Health Nutrition
RB Focused RB Focused RB Focused
Market Growth c +3-5% pa Market Growth c +4-6% pa Market Growth c +3-5% pa
Move from 75 CMUs to 100 CMUs Penetration, market share, new places & new adjacent spaces
Digital, eCommerce, channels and innovation
Reckitt Benckiser Group plc (RB) 25Strategic update and outlook
Growth drivers enable us to win key battles,
especially in disinfectants
1 Penetration 2 Market share optimisation
Region
Product
3 New places: channels, geographies 4 New spaces & adjacencies
Average
Reckitt Benckiser Group plc (RB) 26Strategic update and outlook
Hygiene: winning key battles presented by COVID behaviour trends
Penetration Market share optimisation New places New places
Lysol USA mega brand Finish ADW USA From 40 to 50 Power CMUs Professional
Market share growth CMU value MAT growth rates
+662 bps
May avg.
+600 bps market
share growth vs
pre-COVID
c.10x Global USA
USA
Top 42 Next 8 Remaining
MAT June ’19 MAT June ’20 Oct-19 Jan-20 Apr-20 Feb 2020 May 2020 Philippines USA
Medium term growth +3-5% pa
Reckitt Benckiser Group plc (RB) 27Strategic update and outlook
Health: prioritising customer and consumer need delivery across the portfolio
Market share optimisation Market share optimisation New places New places
Dettol Bar Soaps Maximising supply by Durex eCommerce Iberia Professional
rationalising EUR SKUs
Market share % SKU reduction
c.85%
#1 in India, UAE, +1100 bps c.80%
Australia
Malaysia & Saudi
Arabia
+1000 bps
Capacity increase +74%
c.1.3x Global
+1400 bps c.1.5x
Lockdown*
+430 bps Middle East
Jan 20 Mar 20 May 20 Jul 20
Dettol Dettol
Product 1 Product 2 # Durex orders Lockdown avg
Oct-19 Jan-20 Apr-20 Pre-COVID During COVID Pre-lockdown avg Thailand
Medium term growth +4-6% pa
Reckitt Benckiser Group plc (RB) * Lockdown considered as the time of the strictest restrictions in Spain (14 March 2020 to 11 May 2020) 28Strategic update and outlook
Nutrition: making progress but some challenges still exist
Hong Kong Emerging markets Macroeconomics challenges
Correlation between Mainland visitors LATAM Estimated births2 USA
to HK and IFCN offline sales growth1 LATAM and Caribbean
100K
Greater China
Jun 2019: HK protests begin 80K
Mexico
Jan 2020: HK COVID-19 60K
border closures begin
40K
ASEAN 20K
0
2000 - 2005 - 2010 - 2015 - 2020 - 2025 - 2030 - 2035 - 2040 - 2045 - 2050 -
2005 2010 2015 2020 2025 2030 2035 2040 2045 2050 2055
Indonesia Vietnam
Jan 19 Apr 19 Jul 19 Oct 19 Jan 20 Apr 20 WIC Program
# of Mainland HK Offline IFCN pricing pressures
visitors to HK % sales growth
Philippines Thailand
1. Solo Visitor arrival (using Individual Visitor Scheme) data from HKTB (Hong Kong Tourism Board)
Reckitt Benckiser Group plc (RB) 2. United Nations World Population Prospects 2019. Medium Variant 29Strategic update and outlook
Nutrition: new initiatives affirm growth expectations
Market share optimisation New places Market share optimisation Penetration
NeuroPro USA ASEAN eCommerce Enfinitas Greater China Airborne USA
eCommerce % NR contribution Weekly YOY % sales growth
+237 bps market share
growth in Super High 416%
Premium segment YTD
+14 pps
Jan 20 Mar 20 May 20 Jul 20
+470 bps 3-month old baby
market share growth vs MAT 2017 2018 2019 Q2 2020
Medium term growth +3-5% pa
Reckitt Benckiser Group plc (RB) 30Strategic update and outlook
eRB uplift through COVID lockdowns; plans to accelerate in H2
eRB net revenue Areas of focus for H2 2020
Capture and retain new consumers Win top omnichannel customers
on event days on key marketplaces & activate next growth platforms
> +60%
+20%
11.11
singles day Black Friday
Cyber Monday
Grow direct-to-consumer to drive
Build rocket brands via partnerships
1on1 consumer connections
.com .com
H1 2018 H1 2019 H1 2020
.com 15 new DTC sites
opening in H2
Reckitt Benckiser Group plc (RB) 31Strategic update and outlook
Supply chain: good progress but new opportunities for improvement
Current Status Opportunities Implications and Next Steps
Short-term: expanding capacity
and partnering with co-packers Short-term: continue building
Good progress co-packer relationships to maximise
on supply chain supply and meet consumer demand
fundamentals
Additional work to be done Long-term: assess opportunities
to address growth potential, for additional in-house capacity
Long-term: developing additional and invest for optimal returns
particularly for Dettol & Lysol lines and greenfield sites
Increasing flexibility and
COVID-19 has restricted resilience in core operations Rephasing investments
investment to-date in
into 2021 and 2022
overhauls and refurbishment
Reckitt Benckiser Group plc (RB) 32Strategic update and outlook
Managing our investments during COVID-19
February July
P&L investment £200m in 2020 £200m weighted to H2 2020 / H1 2021
Transformation costs £250m total, phased out in 2022 £250m total, weighted to H2 2020 and 2021
Productivity programme £1,300m over 3 years On track, reviewing options to expand plan
Reinvestments - £100m in H2 2020 / 2021
Capital expenditure £300m incremental spread over 2 years c.£400m incremental spread over 3 years
Total £2.0 bn – over 3 years £2.2bn – over 3 years
Reckitt Benckiser Group plc (RB) 34Strategic update and outlook
Expanded plan increases confidence in growth
• Sustain Hygiene growth
Performance • Reignite Health volume and growth
Drivers • Reignite Nutrition DvM growth
• eCommerce and Digital • Branding building tools
Foundational
• Research & Development • Productivity delivery
Capabilities • Channel specific sales excellence • Supply chain resilience
• Accelerate eCommerce and Digital • Support supply chain expansion
Expanded • Fully deliver Lysol and Dettol potential • Expand CMU’s, new white space
Plan • Build professional capabilities and adjacencies
Reckitt Benckiser Group plc (RB) 35Strategic update and outlook
Medium term financial algorithm is unchanged
2020 2021 Medium term
High single digit Expected COVID-19
Mid-single digits
Net Revenue growth (3-4% underlying) headwinds of 5-6%
(unchanged)
(previously better growth than 2019) (new)
2020 in line with expectations, expect to reflect the full 350bps
investment vs 2019 over 2 years
Adjusted operating (previously over 1 year)
Rebuild to mid-20’s
margin Expect incremental COVID-19 costs continue in H2 2020 and 2021
(unchanged)
(new)
c.3.0 - 3.5% of Net Revenue >4% of Net Revenue for 2021/22 3.0 - 3.5% of Net Revenue
Capital expenditure
(previously c.4%) (previously c.4%) (unchanged)
Free cash conversion Focus on delivering sustainable strong free cash flow conversion in the medium term
Increased confidence in mid-single digit Net Revenue growth & EPS growth of 7-9% in the medium term
Reckitt Benckiser Group plc (RB) 36Strategic update and outlook
Our purpose and our fight
Our purpose Our fight
To protect, heal and nurture Making access to the
in the relentless pursuit of highest quality hygiene,
a cleaner, healthier world wellness and nourishment
a right, not a privilege
Reckitt Benckiser Group plc (RB) 38Strategic update
and outlook
Our compass
Do the
right thing.
Always.
Reckitt Benckiser Group plc (RB) 39Strategic update and outlook
Playing our part in combating COVID-19
Fight for Access Fund Educational campaigns
Equivalent to over 1% of our operating profit
donated to benefit communities around the world Myth Busting with Lysol HERE For
COVID-19Facts.com Healthy Schools
Educational program to minimize
• 2.5m users across 20+ countries the spread of germs in the classroom
UNAIDs partnership Dettol UK pledges £1 million to (IRC) to • 80+ claims evaluated Expanded to reach 58,000 US Title 1
to reach 220,000 150,000 care provide lifesaving • Reached 38m through social media school by 2020
individuals in Africa packages to support programmes to support
with hygiene packs NHS workers refugees in Middle East
TikTok Dettol Hand Wash challenge ~#HandWashChallenge
Impact so far 124.8bn Views
20 initiatives 2.2 million Over 8 million
providing support to people benefiting by individual products
41 countries projects reported donated
Reckitt Benckiser Group plc (RB) 40Strategic update and outlook
The Reckitt Global Hygiene Institute
Our expert partners
Director of the London School
Professor Peter Piot
Funds research & innovation to advance of Hygiene & Tropical Medicine
the understanding of the links between
hygiene and health Dame Sally Davies Master, Trinity College Cambridge
Research Center for Public Health, Tsinghua
Professor Feng Cheng University School of Medicine, Tsinghua
Informs education and behaviour change
to effect long-lasting changes in consumer
behaviour to improve hygiene and health Dr Randeep Guleria
Director, All India Institute
of Medical Sciences (AIIMS)
Department Chair and Professor of
Professor Dr Albert Ko
Epidemiology, Yale School of Medicine
Develops protocols to incorporate hygiene
into the global public health agenda
Dean, Saw Swee Hock School of Public
Dr Teo Yik-Ying
Health, National University of Singapore
Reckitt Benckiser Group plc (RB) 41Strategic update and outlook
Environmental commitments and ambitions
Our commitments Our ambitions
Pledged to accelerate the 65% 100%
reduction in renewable electricity
delivery of the Paris Climate greenhouse gases powering our
Change Agreement to keep from our sites by 2030 operations by 2030
global warming to below 1.5°C
Continuous innovation
to reduce the carbon footprint of our
products and increase energy efficiency
Member of
Net carbon neutral
by 2040 – ahead of the world’s goal of 2050
Reckitt Benckiser Group plc (RB) 42Strategic update and outlook
Our Leadership Team
“An international team: the best of RB supplemented by new hires”
Harold van Kris Licht Aditya Sehgal Jeff Carr Ranjay
den Broek Chief Financial Radhakrishnan
President Health President
Officer Chief HR Officer
President & Global Chief Nutrition & eRB /
Hygiene Customer Officer Greater China
GBU Presidents
Rupert Bondy Zephanie Miguel Veiga Sami Naffakh Volker Kuhn
Group General Jordan Pestana Chief Supply Chief Transformation
Counsel Chief SQRC Head of Corporate Officer Officer
Officer Affairs & Sustainability
Joined 1 July Joining 1 August
Reckitt Benckiser Group plc (RB) 43Key messages
Strong start to 2020 – delivering our strategic plans; tailwind from COVID-19
Global shifts reinforce our strategy, portfolio, purpose and fight
Expanded plan to accelerate growth with higher investment
Organisation, capabilities and culture change well underway to realise opportunity
Reckitt Benckiser Group plc (RB) 44Q&A
Appendices
H1 2020 financial details
Productivity Program: Case studies
PROCUREMENT SUPPLY CHAIN
Developing relationships Nijmegen container fill rate
for joint success
Working with our partners • We negotiated a rebate matrix based The opportunity The outcome
to deliver mutual savings on business growth. With wipes in high
demand this will provide further future • To re-configure the palletisation • Increased palletization is safe thanks
• In health relief, our Procurement financial benefit of milk powder cans shipped to proven individual pack strength;
team are working to build strong from Nijmegen to China benefits of which are immediate
trusted relationships to improve Annual estimated cost saving • Improve sustainability and • Changed the configuration of the
costs for both RB and our partners of c.£250k eliminate unnecessary pallet from 9 to 10 per layer, and
Optimal Care Wipes transport costs implemented 11 high stack pallets
• Optimal Care is a long term Spanish • Cost savings and a reduction of
The challenges
vendor for RB, providing wipes across CO2 emissions
a number of brands • Ensuring transport safety
across the entire supply chain Annual estimated cost saving
• We worked with them to understand
the breakdown of their raw / pack of c.£200k
material
Reckitt Benckiser Group plc (RB) 47H1 2020 financial details
Productivity Program: Case studies
NETWORK / COST DESIGN TO VALUE
OPTIMISATION
Digital platform cross GBU collaboration Mexico 18% material saving
The opportunity Sharing contracts and processes The World packaging Organization • In collaboration with our supplier, we
across the global business units recognized RB for World Star Packaging worked together in a restructuring of
• We have a number of brands at RB
Award 2020 the components of the original
which need unique digital experiences • Collaboration across the business
packaging, weight and stiffness of the
to ensure we connect with our to consolidate processes as well
• The Mexican Packaging Association bag
consumers as consolidating contracts
awarded RB for our new lamination
• Both Health and Hygiene purchased used in the bag of infant formula • The re-engineering work was made
the same Product Information Annual estimated cost saving products possible through the development of
Management system with their own of c.£250k a tetralaminate, Bioriented Nylon on
set of licences with different contract • Change in packaging resulted in an the outside of the bag making it more
length terms 18% reduction in the use of plastics flexible and resistant to punctures
reflected in the savings of materials (from 24.63 lbf to 43.26 lbf), made of
• Opportunity to work together and
and resources polyester, aluminum, and thermo-seal
migrate from two contracts to one
Annual estimated cost saving
of c.£280k
Reckitt Benckiser Group plc (RB) 48Reckitt Benckiser Group plc (RB) 49
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