Brambles’ pallets and containers form the invisible backbone of the global supply chain. This gives Brambles key insights that help customers meet evolving consumer demands while minimising their environmental impact and improving the safety and efficiency of their supply chains.
With a comprehensive suite of supply chain solutions, Brambles provides its customers with operational, financial and environmental efficiencies not otherwise available through the use of single-use disposable alternatives and proprietary models.
Brambles is integral to its customers’ supply chains, working closely with all participants including manufacturers, producers, growers and retailers. With end-to-end involvement, Brambles has clear insights into what impacts the safe, efficient, reliable and sustainable operation of global supply chains.
By leveraging these insights and its unmatched expertise, Brambles offers customers comprehensive solutions that improve the performance of the supply chain. This helps address the challenges associated with the increasing complexity, rapid evolution and, at times, uncertainty of modern supply chains.
Brambles offers customers the widest range of supply chain platforms including: pallets (timber and plastic); Reusable Plastic Crates (RPCs); bins; and specialised containers.
By eliminating the need for customers to purchase and manage their own platforms, Brambles reduces the capital requirements and complexity of customers’ operations while simultaneously reducing waste throughout their supply chains.
Brambles conducts in-depth studies of customers’ supply chains to map the flow of goods, information and platforms to identify the causes of network inefficiencies and product damage.
By determining the optimal mix of platforms and processes for customers’ individual supply chains, Brambles can mitigate network inefficiencies and ensure the safe and sustainable transportation of goods through the supply chain.
Brambles’ superior network scale provides a unique capability to coordinate collaboration between multiple supply chain participants to deliver transport efficiencies. This includes matching and eliminating empty transport lanes, sharing transport and contracting transport for and from customers.
Brambles works closely with its customers to develop retail store solution strategies and consumer-facing platforms that improve the efficiency of the shared supply chain by increasing sales at lower costs to the supplier, retailer and consumer.
These merchandising and fulfilment solutions, which include full size and fractional display pallets, trays and RPCs, effectively improve safety, and reduce the time, labour and activity required to move goods from the point of production to the point of sale.
Using its experience in managing platforms, optimising automated facilities and packaging performance testing, Brambles has developed solutions that improve the overall performance and efficiency of customers’ facilities. These solutions include: customising customers’ platform processes; optimising how customers configure, build and protect product loads; and providing higher quality platforms and engineering services to improve the performance of automated facilities.
Brambles’ leadership in sustainable sourcing of materials and strong governance controls reduce risk and provide customers with confidence in their supply chain partnership.
Brambles creates value for customers by providing a sustainable alternative to single-use disposable packaging, saving customers money and significantly reducing the environmental impact of their operations.
Brambles’ network resilience and its resource efficient, low‑carbon solutions means it has an important role in helping customers manage through supply chain disruptions while transitioning to a low-carbon economy.
Brambles’ Zero Waste World programme reinforces its commitment to collaborate with customers and create smarter and more sustainable supply chains – creating more value by using less and regenerating more resources.
Through ZWW, Brambles seeks to use its unique position in the supply chain to help customers address three key industry challenges:
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Eliminating waste
by using its circular economy expertise to convert customers to more sustainable ‘share and reuse’ solutions which save resources and reduce costs;
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Eradicating empty transport miles
by using its network scale and visibility to facilitate collaborative transport solutions, bringing manufacturers and retailers together to reduce the environmental impact of their operations and save money; and
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Reducing inefficiencies
by using its end-to-end supply chain solutions and BXB Digital technology to enhance customers’ visibility of their supply chains so they can make better decisions.
Brambles generates value through a ‘share and reuse’ model that leverages its scale, density and expertise to achieve superior operational efficiencies. These efficiencies in turn generate cash flow that can either be returned to shareholders or reinvested in the business to fund growth, innovation, the development of its people and build a more resilient business.
Brambles shares the efficiencies generated by its scale, density and expertise with its customers, providing a compelling value proposition compared to alternatives. By providing customers with supply chain solutions in approximately 60 countries, Brambles offers shareholders exposure to geographically diversified earnings streams, primarily from the global consumer staples sector.
The supply chains served by Brambles also provide a broad range of growth opportunities including: increasing penetration of core equipment-pooling products and services in existing markets; diversifying the range of products and services; exploring the digitisation of supply chains; and providing a resilient foundation during supply chain uncertainties.
Within this context, Brambles is committed to striking the right balance between growing its business and delivering sustainable shareholder returns over the long-term. By focusing on its core drivers of value, Brambles expects to deliver:
Sustainable growth at returns well in excess of the cost of capital
- Sales revenue growth7 in the mid-single digits;
- Underlying Profit growth7 in excess of sales revenue growth through the cycle; and
- Strong Return on Capital Invested.
Cash generation to fund growth, innovation and shareholder returns
- Free Cash Flow sufficient to fully fund capital expenditure and dividends.
7 At constant currency.
During the Year, Brambles moved to a payout ratio-based dividend policy, targeting a payout ratio of 45-60% of Underlying Profit after finance costs and tax, subject to Brambles’ cash requirements, with the dividend per share declared in US cents and converted and paid in Australian cents.
This Year, the Board declared total dividends (excluding the special dividend declared as part of the capital management programme) of 18.0 US cents per share, with the Australian dollar payment equivalent to 25.92 AU cents per share. This results in a payout ratio for the Year of 53%, which is broadly in line with the prior year payout ratio, including IFCO’s 2019 earnings contribution. FY19 total dividends were 29.0 AU cents per share.
The final dividend for 2020 of 9.0 US cents per share, is in line with the 2020 interim dividend and will be 30% franked. This dividend is payable in Australian dollars 12.54 AU cents per share on 8 October 2020 to shareholders on the Brambles register at 5.00pm on 10 September 2020. The ex-dividend date is 9 September 2020.
At the time of the sale of its IFCO RPC business, Brambles announced that it intended to use the US$2.4 billion net proceeds to fund a A$2.8 billion (US$1.95 billion) capital management programme, through an on‑market share buy-back of up to A$2.4 billion (US$1.65 billion) and a pro-rata return of cash of 29.0 AU cents per share, and to pay down debt.
The on-market share buy-back commenced on 4 June 2019 and to date 91,697,878 ordinary shares have been bought back and cancelled for a total consideration of A$1,049.7 million.
On 22 October 2019, Brambles paid a 29.0 AU cents per share pro‑rata cash return comprising two components: a capital return of 12.0 AU cents per share and a special unfranked dividend of 17.0 AU cents per share. The total cash payment for the pro-rata return was A$453.8 million.
At 30 June 2020, Brambles had completed A$1.5 billion, that is 53% of the A$2.8 billion capital management programme.
On 5 July 2019, Brambles repaid the US$500 million April 2020 144A bond issue using part of the IFCO sales proceeds.
Given the on-market share buy-back programme will continue into FY21, the Board has decided to continue to suspend the Dividend Reinvestment Plan.