Bewi Asa · OSL:BEWI
Bewi Asa — Q2 2022 Earnings Presentation
26 slides from Bewi Asa's earnings presentation, Aug 11, 2022
Slide 1: Results for the second quarter and first half of 2022
Results for the second quarter and first half of 2022 CEO Christian Bekken, CFO Marie Danielsson 11 August 2022
Slide 2: Cautionary note regarding forward-looking statements
Cautionary note regarding forward-looking statements This presentation, prepared by BEWI ASA (the "Company"), may contain statements about future events and expectations that are forward-looking statements. Any statement in this presentation that is not a statement of historical fact including, with
Slide 3: Highlights
Second quarter and first half of 2022 Highlights 1
Slide 4: Delivering another record quarter
Delivering another record quarter Solid demand, strong price management and accreditive acquisitions • Continued solid demand from key markets • 40% growth in sales, 50/50 organic and from acquisitions • All segments contribute positively to organic growth in sales and adj. EBITDA, as a result of pr
Slide 5: Financial highlights for the second quarter of 2022
Financial highlights for the second quarter of 2022 Net sales (EUR million) Net sales of EUR 277.0 million, 40% growth BEWI Jackon • 19% organic growth 127 o Solid demand from key markets 113 o Succesfully managed to increase prices in all segments o Positive development for sales to food industry 2
Slide 6: Key acquisitions confirming strategy
Key acqusitions confirming strategy Annual Period Company Region Key offering Strategic rationale Status sales1 Volker Gruppe EURm ~17 UK Circular solutions Increase circular volumes Closed Q4 2021 Strengthening market position Benelux/ Kemisol EURm ~36 Belgium Packaging and insulation Closed geogra
Slide 7: Profitable growth from acquisitions
Profitable growth from acqusitions Annual pro-forma sales close to EUR 1.5 billion with EBITDA of more EUR 190 million EUR ~1.5 billion Increased diversification from acquisitions Net sales Reported net sales BEWI (EURm) 449 • Recent geographic expansion to Belgium, the Annual net sales not consolid
Slide 8: Strengthened integrated business model
Strenghened integrated business model A competitive advantage in volatile markets First half of 2022 Diversified across countries Diversified across segments1) Diversified across end-markets2) Baltics 2% Iceland Other 10 % Circular 2% France Norway 7% 3% 18 % Food packaging 22 % RAW Other incl. HVAC
Slide 9: Acquisition of Berga Recycling
Acquisition of Berga Recycling A world leading company within trading of materials for recycling Business overview Key financials Investment highlights Net sales (EURm) • Established in 2011 in Canada Significant EPS volume (~15kt in 6% 31 2021), increasing Circular’s CAGR • Vision to become the wor
Slide 10: BEWI Circular post Berga-transaction
BEWI Circular post Berga-transaction We continue to lead our industry’s change towards a circular economy BEWI Circular Key financials Net sales bridge (EURm)1) • BEWI Circular will make a > 100k tonnes difference by creating a circular 31 of waste handling in 2021 system for waste streams 74 • Berg
Slide 11: Acquisition of BalPol
Acquisition of BalPol Leading provider of insulation and packaging solutions in Lithuania Business overview Strategic rationale Transaction overview • Established in 2002 as a polystyrene foam • Geographic expansion, providing a platform for • Acquire 100% of the shares production company further gr
Slide 12: Financials
Second quarter and first half of 2022 Financials 1
Slide 13: Financial overview
Financial overview Organic growth in all segments Net sales Adj. EBITDA EUR million EUR million 43 0.6 38 4 5 Q2 2022 277 40 198 32 Q2 2021 Organic Acquisitions Currency & Q2 2022 Q2 2021 Organic Acquisitions Currency & Q2 2022 divestments divestments 2.1 6 0.8 70 21 93 1H 2022 507 75 347 48 1H 2021
Slide 14: RAW
RAW Continued growth following price increase and strong operational performance Second quarter of 2022 Net sales 25 Adj. EBITDA 30% EUR million EUR million • Net sales of EUR 125.4 million, up 24% 20 25% 100 20% o Increase explained by higher sales prices 15 15.7 % 15% • Adj. EBITDA of EUR 16.4 mil
Slide 15: Insulation
Insulation Profitability improvement following price increases Second quarter of 2022 100 Net sales 20 Adj. EBITDA 30% EUR million EUR million • Net sales of EUR 85.3 million, up 47% 80 25% 15 o 24% organic growth from stable demand and higher sales prices 20% 60 o Growth from acquired companies inc
Slide 16: Packaging & Components
Packaging & Components Continued solid demand, in particular for food packaging products Second quarter of 2022 Net sales 20 Adj. EBITDA 30% 100 EUR million EUR million • Net sales of EUR 92.4 million, up 41% 25% 80 15 o 10% organic growth from higher sales prices 20% 60 10 13.9 % 15% o Continued go
Slide 17: Circular
Circular Improved volumes and increased sales prices Second quarter of 2022 30 Net sales 5 Adj. EBITDA 30% EUR million EUR million • Net sales of EUR 18.2 million, up 172% 25 4 25% o 41% organic from higher volumes and increased sales prices 20 20% 3 o Prices for recycled material correlate to price
Slide 18: Consolidated P&L
Financials Consolidated P&L Amounts in EUR million Q2 2022 Q2 2021 1H 2022 1H 2021 2021 Second quarter of 2022 Net Sales 277.0 198.1 507.2 347.0 748.2 • Net sales of 277.0 million, up by 40% Total operating income 277.0 198.1 507.2 347.0 748.2 o 19% organic growth from good price management in all s
Slide 19: Minority interests
Minority interests Positive contribution from shares in associated companies TOTAL • Current minority interests: o 34% in HIRSCH Porozell GmBH (Germany), 6 facilities Production sites 12 o 34% in HIRSCH France SAS (France), 5 facilities Owned interest 34% o 34% in Inoplast S.R.O, 1 facility Book val
Slide 20: Capital structure
Financials Capital structure Leverage: Net debt/ EBITDA ratio(1) • Net debt EUR 298 million/ EUR 195 million excl. EUR million IFRS 16 • Credit facility of EUR 100 million, unutilized on 30 June 2022 • Increased leverage following recent acquisitions 2.9 2.9 2.4 2.7 1.5 2.5 1.8 2.6 1.5 2.2 1.3 1.9 1
Slide 21: Strong cash flow, maintenance CAPEX below 2.5% of sales
Financials Strong Cash flow, maintenance CAPEX below 2.5% of sales EUR million Second quarter of 2022 • Operating cash flow of EUR 25.0 o Stable working capital • CAPEX of EUR 9.2 million (8.5) o EUR 2.7 million related to investment programmes 7.4 10.8 19.9 0.3 1.4 31.2 34.5 25 Ongoing investment p
Slide 22: Summary and outlook
Second quarter and first half of 2022 Summary and 1 outlook
Slide 23: M&A priorities going forward
M&A priorities going forward Strategic rationale Expanding circular business model Broadening product offering with complimentary materials: • Packaging: Paper/ fiber-based • Insulation: EPS and other materials Strengthening market positions Geographic expansion Established market positions Attracti
Slide 24: Outlook
Outlook Experience continued solid demand • Experience solid demand in key markets, also into Q3 • Well-positioned to meet industrywide challenges in value chain o Shortage of electronic components o Delay in logistics & transport o General cost inflation • GAP expected to remain at high levels o Ex
Slide 25: Set to continue growth journey next five years
Set to continue growth journey next five years >2x ~20% <2.5x 30-50% Adj. EBITDA ROCE1 NIBD/Adj. EBITDA Dividend Through organic growth Increase towards 20% Leverage target Of underlying net profit and acquisitions by 2026 unchanged going forward Second quarter of 2022 25
Slide 26: Next event: Third quarter 2022
Next event Third quarter 2022 9 November 2022