Solvay Sa · EURONEXT:SOLB
Solvay Sa — Investor Day (2013)
23 slides from Solvay Sa's investor day presentation, 2013
Slide 1: Delivering on our strategy
Delivering on our strategy Jean-Pierre Clamadieu
Slide 2: Strong divergence amongst regional economic scenarios
Strong divergence amongst regional economic scenarios Shift in geo-advantages Multi-speed global economy Europe United States 11.9* 0.8% 2.7 2.7% China 12 7.2% Saudi Arabia 0.8 4.1% Brazil 9.5 2.9% * Germany Price of gas in 2012 GDP CAGR 2012/2016 (IMF) in US$/million BTU 2 Source: ACC 2013, IMF
Slide 3: Leading to unprecedented shift in industrial competitiveness and capital investments reallocation
… Leading to unprecedented shift in industrial competitiveness and capital investments reallocation UPTAKE IN INVESTMENTS +40% expected in INDUSTRIAL chemical industry output RATIONALIZATION over 2012-2020 CONTINUED +2% expected in chemical INVESTMENTS Chemicals investments CAGR +4%/y over 2002-2009
Slide 4: Global chemical demand growth driven by megatrends and Asia
Global chemical demand growth driven by megatrends and Asia Market drivers Global chemical demand (B€) Climate Change 5,100 36% Resource scarcity 2,850 24% China 27% Health and well being Other Asia 25% 13% Western Europe 19% 14% North America 17% 6% South America 5% “ Next billion consumers ” 7% Re
Slide 5: Our strategic vision
Our strategic vision Build a strong leader participating in the reshaping of the global chemical industry Be a model of sustainable chemistry, attracting and growing the people who will imagine, engineer and make the solutions that meet the global challenges society faces, creating value for all our
Slide 6: Our strategic response: an in-depth transformation
Our strategic response: an in-depth transformation EXECUTING A CLEAR STRATEGY BY CAPITALIZING ON SOLVAY’S STRENGTHS Reinforcing business profile through strategic portfolio changes Striving for excellence across businesses Innovating to create sustainable solutions Transforming company cultu
Slide 7: Executing our strategic action plan
Executing our strategic action plan 2010 2011 2012 2013 Integration Transformation Integration & Definition Chlorovinyls Europe JV of new strategic priorities announcement Pharma Rhodia divestiture acquisition Solvay Indupa divestiture Alignment of Corporate & Business structure Chemlogics acquisiti
Slide 8: Enhancing our business profile
Enhancing our business profile B. Solvay’s ability to Extract value GROW ENHANCE Chemlogics 90% of sales in businesses ranking among top 3 global leaders RESTORE EXIT A. Value creation potential of industry segment 2011/2013 Solvay Group Chemical Industry Solvay businesses 8
Slide 9: Rebalancing geographic markets exposure
Rebalancing geographic markets exposure Continuous focus on fast-growing regions Europe North America -8% 24% +4% 34% Asia Pacific / Rest of the world 31% +3% Latin America 11% +1% Figures represent percentage of sales on a 9M 2013 basis (restated for discontinuation of Chlorovinyls and proforma Che
Slide 10: Enhancing exposure to higher growth end-markets
Enhancing exposure to higher growth end-markets A well-balanced portfolio Aeronautics & Automotive 17% (+1pp) Consumer Goods Agro Food & Healthcare 11% 23% Energy & Building & Environment Construction (+3pp) 14% 10% (-4pp) Electrical & Electronics Industrial Applications 7% 19% % of 2012 net sales r
Slide 11: Strategic repositioning toward a less asset intensive and a more sustainable model
Strategic repositioning toward a less asset intensive and a more sustainable model Tangible Assets Group CO2 intensity Group Energy intensity Replacement Value/Sales (ton CO2 eq/EUR Sales) (1015J/EUR Sales) 1,25 1,20 17,9 -7% -4% -17% 1,16 1,15 14,8 Former Current Former Current Former Current Perim
Slide 12: Unlocking value through Excellence breakthrough initiatives
Unlocking value through Excellence breakthrough initiatives Relentlessly challenging everything we do… Operational Organic Innovation Excellence Growth ~ € 300 m ~ € 280 m ~ € 250 m Manufacturing, Energy A culture of efficiency Commercial Fixed & Variable costs Innovation Excellence excellence Suppl
Slide 13: REBITDA to reach €2.3bn to €2.5bn
Targets capture portfolio management and macroeconomic challenges BY 2016 REBITDA to reach € 2.3bn to € 2.5bn CFROI to increase by over 100 bp vs 2013 From 1/3rd (2012) to 2/3rd (2016) of business assets in value creation zone 13
Slide 14: Balanced levers to achieve outperformance
Balanced levers to achieve outperformance REBITDA in mEUR 2,300 - 2,500 250 280 (260) 300 90 1,650 OEE / Commercial Excellence >10% CAGR 2013e Chemlogics Inflation Operational Excellence Organic Growth* Innovation Portfolio 2013 2016e versus prior Portfolio: € (200) m Forex: € (50) m ambition:
Slide 15: Differentiated strategic priorities through our businesses
Differentiated strategic priorities through our businesses REBITDA breakdown* Consumer Chemicals Driving growth, maintaining low capital intensity 23% 28% ~50% 5% 11% 33% Advanced Materials Driving growth, delivering high capital returns 2012** Performance Chemicals Enhancing sustainable cash genera
Slide 16: From 1/3rd to 2/3rd of business assets in value creation zone
From 1/3rd to 2/3rd of business assets in value creation zone 2012 2016 CFROI CFROI 1/3 2/3 Premium Premium Return: WACC+150bp Premium Return Return CFROI = REBITDA - Rec. Capex – Tax 16 Gross assets + Working Capital
Slide 17: Focused on being a model of sustainable chemistry
Focused on being a model of sustainable chemistry Taking Commitments Planet Reach excellence in safety & health Deploy unmatched sustainable portfolio management Customers Reduce our impact on environment Investors Energy consumption Greenhouse gas emissions Water emissions** Groundwater consu
Slide 18: A strong team with a proven track record
A strong team with a proven track record Executive Committee as of Jan 1st, 2014 Jean-Pierre Karim Vincent Jacques Pascal Juery Roger Kearns Clamadieu Hajjar De Cuyper van Rijckevorsel CEO CFO Consumer Chemicals Advanced Materials Performance Chemicals Functional Polymers Solvay Energy Services E. B
Slide 19: Management incentives aligned to value creation
Management incentives aligned to value creation Executive Committee & General Managers New compensation policy as from 2013, harmonized across the Group Reinforced link between variable compensation and business performance Short term incentive plan - Linked to Group performance (REBITDA & FCF
Slide 20: Executing a clear value creation strategy
Executing a clear value creation strategy Towards a high growth, less capital intensive & high return Chemical Group Targeting Sustainable Value Growth 20
Slide 21: Annex
asking more from chemistry”
Slide 22: Our ambitious Sustainable Development policy
Our ambitious: Sustainable Development policy Five priority objectives 1 To achieve excellence in safety, health and occupational hygiene for everyone on our sites To realize an increasing share of our sales in markets or with a portfolio of activities meeting 2 the requirements of sustainable devel
Slide 23: Our commitments
Our commitments Safety & health Less than one occupational accident with medical 1 of our employees In 2020 treatment* per million working hours Our business 20% of Net Sales 2 portfolio In 2020 100% of innovation projects aligned to sustainable development requirements Our industrial 3 sites In 202