For internal use only

Growth Against the Odds

October 2013 GMA/FMI Conference

BCG document 1

BCG document 2

Growth drives value

Sources of TSR, top-quartile S&P 500

0

10

20

30

40Change in annual TSR (%)

1990-2009

Revenue growth

Margin Free cash flow

10 years

74%

5 years

58%

3 years

50%

1 year

29%

Multiple

BCG document 3

Improbable growth

5Y revenue growth (%)

5Y TSR (%)

–20%

0%

20%

40%

–20% 0% 20% 40%

No growth

Bad growth

Good growth

BCG document 4

Tough odds for large CPG players

62.0 61.9 61.4 60.6

8.1 8.1 8.2 8.6

20

0

100

80

60

40

Midsize

Large

12.2

2009

$664B

17.8

12.1

$677B

2010

12.4

18.0

$703B

2011

12.7

18.1

$722B

2012

Extra small

Small

17.8

Change in share '09-'12

+.5 pt

+.6 pt

+.3 pt

-1.4 pt

$ sales % of total

BCG document 5

In search of 'uphill growers'

• Previously stagnant

• Growth turnaround

• Sustained growth

• Created value

BCG document 6

Porsche

BCG document 7

Earning the "right to grow"

Porsche

1992

BCG document 8

Porsche’s growth path

Maximize the core

Expand into adjacencies

Explore new frontiers

1 year

2-4

years

5+

years

911

Boxster

Cayenne

Panamera

918 Spyder hybrid

BCG document 9

Breakout, sustained, profitable growth

Consistent growth Incremental launches

0

100

200

300

400

500

600

700

1990 1995 2000 2005 2010

Revenue - indexed

7

1 2

19

0

5

10

15

20

(%)

TSR 90-08

Cash

flow

Multiple Margin Rev

11

0

20

40

60

80

100

120

New vehicle sales ('000s)

12

10

08

06

04

02

00

98

96

94

92

90

Source: Global advantage database, BCG analysis, Porsche annual reports

Growth-driven value

911

Boxster

Cayenne

Panamera

924/944/968

Porsche

Auto and comps

BCG document 10

Starting position matters

Competitive premium

Competitive stability

Low

Low

High

High

Stable low-premium

Turbulent high-premium

Stable high-premium

Turbulent low-premium

% o

f com

pani

es

48% %

of c

ompa

nies

83%

17% %

of c

ompa

nies

66%

% o

f com

pani

es

BCG document 11

Competitive premium

Competitive stability

Low

Low

High

High

Stable low-premium

Turbulent high-premium

Stable high-premium

Turbulent low-premium

Starting position matters

BCG document 12

Lessons from breakout growers

Stable low-premium

Turbulent high-

premium

Stable high-

premium

Turbulent low-

premium

• Reinvest in core and explore adjacencies

• Build a "bet portfolio" • Move quickly: kill or scale up

• Seek near

adjacencies • Maintain

core • Transplant

globally

Maintain/expand margin while growing

• Migrate

core: new frontiers

• Monetize poor portfolio

• Prioritize domestic

BCG document 13

1. Clarify your aspiration

BCG document 14

1. Clarify your aspiration

2. Know your advantage

BCG document 15

1. Clarify your aspiration 2. Know your advantage 3. Widen your perspective

BCG document 16

Wider field of vision

Where to play

Commercial initiatives

Maximize the core

Expand into adjacencies

Explore new frontiers

Organic innovation

M&A/ partnership

Business model

innovation

How to win

BCG document 17

1. Clarify your aspiration

2. Know your advantage 3. widen your perspective

4. Force tough choices

BCG document 18

1. Clarify the aspiration 2. Know your advantage 3. Widen your perspective 4. Force tough choices 5. Fund the journey

BCG document 19

1. Clarify the aspiration

2. Know your advantage 3. Widen your perspective

4. Force tough choices 5. Fund the journey

6. Align vision and action

BCG document 20

Integration of vision, choices, action

Purpose

Vision

Strategic choices

Initiatives

Enablers

Goals and metrics

Thank you

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