Arkema Sa · EURONEXT:AKE
Arkema Sa — Q2 2014 Earnings Presentation
19 slides from Arkema Sa's earnings presentation, Aug 1, 2014
Slide 1: 2nd quarter 2014 results
nd 2 quarter 2014 results August 1st, 2014
Slide 2: 2Q'14 highlights
2Q’14 highlights €1,520m sales -3.3% versus 2Q’13 at constant scope of business and exchange rate Volumes up +2.5% excluding impact of Chauny shutdown €206m EBITDA Versus €273m in 2Q’13 fully attributable to: ● Challenging market conditions in Fluorogases ● After a good start of the year, temporary
Slide 3: 2Q'14 key figures
2Q’14 key figures In €m (except EPS) 2Q’13 2Q’14 variation Sales 1,629 1,520 (6.7)% EBITDA 273 206 (24.5)% EBITDA margin 16.8% 13.6% Recurring operating income 195 126 (35.4)% Adjusted net income 124 68 (45.2)% Net income (Group share) 112 47 (58.0)% Adjusted EPS 1.98 1.07 (46.0)% 3
Slide 4: Sales bridge
Sales bridge Sales (€m) Scope of FX rate – Volumes Price business translation effect 1,629 +1.1% (4.4)% (0.9)% (2.5)% 1,520 ● Mainly driven ● Lower prices ● Changes in ● Strong euro by Industrial and consolidation versus US Specialties unfavorable scope* dollar mix in ● +2.5% Fluorogases excluding a
Slide 5: Sales breakdown by segment and region
Sales breakdown by segment and region High Performance Coating Europe Materials Solutions Asia and RoW 24% 36% 31% H1’14 sales 42% €3,0bn 33% 34% Industrial North America Specialties 5
Slide 6: High Performance Materials
High Performance Materials In €m 2Q’13 2Q’14 variation Sales 477 451 (5.5)% Volumes +0.9% EBITDA 93 67 (28.0)% Prices (4.1)% EBITDA margin 19.5% 14.9% FX (translation) (2.3)% Recurring operating income 68 41 (39.7)% Scope - % of segment 2Q’14 sales Technical Polymers Filtration & Adsorption Organic
Slide 7: Industrial Specialties
Industrial Specialties In €m 2Q’13 2Q’14 variation Sales 540 509 (5.7)% Volumes +5.5% EBITDA 114 80 (29.8)% Prices (8.2)% EBITDA margin 21.1% 15.7% FX (translation) (2.3)% Recurring operating income 85 50 (41.2)% Scope (0.7)% % of segment 2Q’14 sales Thiochemicals Fluorogases PMMA H2O2 29% 29% 25% 3
Slide 8: Coating Solutions
Coating Solutions In €m 2Q’13 2Q’14 variation Sales 602 555 (7.8)% Volumes (2.0)% EBITDA 84 71 (15.5)% Prices (1.2)% EBITDA margin 14.0% 12.8% FX (translation) (2.7)% Recurring operating income 61 48 (21.3)% Scope (1.9)% % of segment 2Q’14 sales Acrylics (acid + esters) Coating Resins Coatex Sartome
Slide 9: 2Q'14 cash flow
2Q’14 cash flow In €m 2Q’14 EBITDA 206 Usual peak of working capital end of June Working capital variation* (28) €(180)m working capital variation* in 1H’14 should largely reverse by year end Taxes (39) Cost of debt (10) Recurring capex (80) Others (16) RECURRING CASH FLOW 33 Non-recurring items in
Slide 10: Outlook
Outlook Economic environment in 2H’14 assumed to be in continuity with 2Q’14 Target: FY 2014 EBITDA close to €800m Previous Other business lines guidance in line with prior expectations Adjusted guidance Stable Lower than performance in Competition FX expected fluorogases in and (translation) volume
Slide 11: 4 important profitability drivers in 2015 and beyond
4 important profitability drivers in 2015 and beyond Fluorogases - Worldwide Thiochemicals – Malaysia / Asia First benefits of internal and external elements New growth driver supporting strong development to restore progressively profitability of Thiochemicals (significant growth in past 10 years)
Slide 12: Current priorities
Current priorities Acrylics acquisition in China: closing expected in September 2014* Thiochemicals platform in Malaysia: mechanical completion expected end of summer 2014 New methyl acrylate unit in Clear Lake • Completion of the US$ 110m investment plan in Texas over 3 years • Ramp up with applica
Slide 13: Restoring profitability of Fluorogases
Restoring profitability of Fluorogases Raw material Arkema’s main products Applications HCFC HFC HFO Emissive Old Generation Current Generation Next Generation Air conditioning Refrigeration Foams Fluorspar / HF 134a Solvents 22 125 1234yf Aerosol 142b 32 1233zd Blends Non emissive Fluoropolymers Ac
Slide 14: Accelerate growth in Thiochemicals
Accelerate growth in Thiochemicals Arkema’s Thiochemicals • #1 worldwide with manufacturing sites in every region: Americas, Asia, Europe • State-of-the-art technology and know-how • Internationally recognized brand and highly differentiated level of services • End of 2014, major capex behind us (La
Slide 15: Acquisition in acrylics in China: Sunke
Acquisition in acrylics in China: Sunke Capture strong growth in Asia An attractive deal with competitive and well-located site Demand and expected growth by region • In-depth technical audit of the site performed by Arkema’s teams RoW • Modern assets (start up 2012 and beyond) Europe • Replace a gr
Slide 16: A long-term transformation project
A long-term transformation project 2015 - 2020 Accelerate growth Benefits from: 2013 - 2014 • Significant projects started Transition towards • Product innovations from growth phase megatrends (lightweight materials, new energies, • Implementation of significant consumers, electronics…) 2006 - 2012
Slide 17: Footprint now well in place in Asia
Footprint now well in place in Asia Acrylics* Taixing Main production sites in Asia 2014 PMMA Technical Polymers Jinhae Hengshui 1998 and 2004 2012 Hydrogen Peroxide Shanghai Polyamides 2000 and 2008 Zhangjiagang (Hipro) 2012 Fluorogases Changshu 2002 and 2010 Fluoropolymers Sartomer Changshu Guangz
Slide 18: Confidence reiterated in mid term outlook
Confidence reiterated in mid term outlook Thorough review of each business unit prospects Financial mid-term (MT) targets confirmed: ● €8 billion sales ● 16% EBITDA margin MT targets, initially planned for 2016, now set for 2017 to take into account a more progressive return to normalized conditions
Slide 19: Disclaimer
Disclaimer The information disclosed in this document may contain forward-looking statements with respect to the financial condition, results of operations, business and strategy of Arkema. Such statements are based on management’s current views and assumptions that could ultimately prove inaccurate