This PPT slide, part of the 54-slide Value Creation Framework PowerPoint presentation, outlines a framework for understanding value creation, specifically through the lens of Total Return to Shareholders (TRS). It emphasizes that value creation is fundamentally linked to discounted cash flow, which is influenced by 2 primary factors: spread and growth. The visual structure of the slide suggests a roadmap, guiding the viewer through the interconnected components of value creation.

At the top, "Value Creation" serves as the overarching theme. Below it, TRS is highlighted as a key metric, indicating that shareholder returns are a critical measure of success. The slide then introduces the concept of discounted cash flows, which are essential for assessing the value generated for shareholders.

The flowchart indicates that value is created when the spread—defined as the difference between Return on Invested Capital (ROIC) and the Weighted Average Cost of Capital (WACC)—is increased. This suggests that enhancing operational efficiency and capital allocation can directly impact value creation. The slide further breaks down the mechanisms of achieving this spread through 2 main avenues: organic growth and mergers and acquisitions (M&A).

The mention of organic growth implies a focus on internal strategies to boost cash flow, while M&A is presented as a method to amplify value creation when the spread is positive. This indicates a strategic approach to leveraging both internal and external growth opportunities to maximize shareholder returns.

Overall, the slide provides a clear and structured overview of how value creation can be systematically approached, making it a valuable reference for executives seeking to enhance shareholder value.

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Shareholder Value Value Creation M&A