Comparison Of Lion Dairy And Drinks

Dairy & Drinks SAP Journey and Future Direction

25 May 2011

Raymond John IT Director – Dairy & Drinks

May 2011

AGENDA • • • • • • Lion Dairy & Drinks Overview The Challenge in 2006 Transforming the platform Acquisition Next Steps Lessons Learnt

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KEY FACTS
• Lion Dairy & Drinks has two main channels: ‒ Grocery (Woolworths, Coles, Other independent supermarkets) which accounts for 56% of net sales; and ‒ Convenience & Food Services (CFS) accounting for 44% of net sales • Private Label brands are significant in grocery (53.7% of fresh/UHT milk) and growing. This places pressure on branded players due to the price differential • • CFS is a highly complex channel consisting of over 100,000 stores, each with differing needs
BRANDS
Milk (White and Flavoured)

Category Rank

#1

Dairy (Yoghurt and dairy deserts)

#1

Juice #1 (Chilled and ambient)

Cheese (Everyday and Specialty)

#1

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GEOGRAPHIC

Malanda (Milk & Cheese)

Booval (Milk) Vitasoy JV (Soy) Leeton (Juice) Riverland (Juice) Murray Bridge (Dairy & Cheese) Bentley (Milk and juice) Clarence Gardens (Milk) Jervois (Cheese) Salisbury (Milk) Shepparton (Milk)
Divested (FreshCo) Other JV National Foods Dairy Farmers

Lytton (Juice) Crestmead (Milk) Hexham (Fresh Milk, condensed milk and desserts, cottage cheese and milk powder) Penrith (Milk) Lidcombe (Milk and dairy) Baulkham Hills (Perfection dairies) Wetherill Park (dairy, sour cream and bottle and carton UHT) Smithfield (Juice) Canberra - JV with Bega (Milk and cream) Campbellfield (Cheese) Chelsea Heights (Milk) Morwell (Dairy) Kings Meadow (Cheese)

Allansford (Cheese) Simpson (Cheese) Cobden (Milk) King Island (Cheese) Burnie & Heidi Farm (Cheese) Lenah Valley (Milk)

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AGENDA • • • • • • National Foods Overview The Challenge in 2006 Transforming the platform Acquisition Next Steps Lessons Learnt

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COMPLEX PLATFORMS

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SILOS THROUGH ACQUISITIONS

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A CASE FOR CHANGE

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SETTING THE
INTEGRATED PLATFORM
The integrated platform delivered on: •One customer one invoice •Single source of the truth
Vendors
Portal Portal

Customers

Customers

Vendors

•Collections management (working capital)
•Cost to serve automation and visibility •Indirect sales visibility

Dairy Farmers SAP 4.5B

National Foods SAP ECC6

Portal

Customers

Vendors Vendors Vendors

•Improved forecast and statistical visibility

One Platform SAP ECC6

•Improved communication with farmers and suppliers
•Milk management and reporting •Improved fridge fleet efficiency OCI business benefits that are IT dependent amount to a total $14.2m

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AGENDA • • • • • • National Foods Overview The Challenge in 2006 Transforming the platform Acquisition Next Steps Lessons Learnt

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NEW LEADERS, NEW DIRECTION
LION • Beer, Spirits, Wine, Australia
(Formerly Lion Nathan Australia)

• Beer, Spirits, Wine, New Zealand
(Formerly Lion Nathan New Zealand)

• Dairy & Drinks
(Formerly National Foods)

• Balanced Business Strategy • Balanced Business Plan • Great People • Great Brands • Customer Engagement • Lion Way

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NEXT STEPS

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Lion Dairy & Drinks - Balanced IT Investment Program

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LESSONS