Clariant Ag · SIX:CLN
Clariant — Nomura Chemicals Conference 2010
51 slides from Clariant's conference presentation, Mar 18, 2010
Slide 1: Nomura Chemicals Conference 2010
Public 18/19 March 2010 Nomura Chemicals Conference 2010 Dublin, 18/19 March Patrick Jany, CFO
Slide 2: Agenda
Agenda Full-year 2009 in review Business Unit profiles Outlook Public Nomura Chemicals Conference, Dublin, 18/19 March 2010 (Copyright Clariant. All rights reserved.) Slide 2 / 51
Slide 3: Full-year 2009 – highlights
Full-year 2009 – highlights stringent focus on cash generation paid off, delivered one of the strongest operating cash flows in Clariant’s history restructuring efforts progressed well and began to show an effect on the P&L, mitigating the impact of the economic crisis on our operational income
Slide 4: Full-year – financials
Full-year – financials FY/09 FY/08 in CHF in LC Sales in CHF million 6 614 8 071 –18% –14% Gross margin 28.2% 28.7% EBIT before exceptionals in CHF million 270 28.7% 29.2% 530 EBIT margin before exceptionals 4.1% 6.6% Net loss / income in CHF million –194 –28 Operating cash flow in CHF million 757 3
Slide 5: 2009 – FUN resilient to downturn, broad-based recovery in MB
2009 – FUN resilient to downturn, broad- based recovery in MB Functional Chemicals (FUN) Recovery in the industrial businesses during the year, but situation remains difficult Personal Care and Industrial Home Care stable Newly opened site in China rapidly ramped up production Masterbatches (M
Slide 6: 2009 – P&A hurt by de-stocking, TLP returned to profitability
2009 – P&A hurt by de-stocking, TLP returned to profitability Pigments & Additives (P&A) De-stocking has slowed as 2009 progressed, but still ongoing at year-end Massive cut-back in production below weak demand levels led to high idle facility costs, mainly in H1/09 Increased demand from the p
Slide 7: Restructuring – the first step in 2009/10 to build a solid platform for profitable growth
Restructuring – the first step in 2009/10 to build a solid platform for profitable growth Timeline < 2009 > 2010 Restructuring Focus Continuous improvement Profitable growth Actions Project Clariant Clariant Excellence Growth & Opportunities Cash generation People Excellence Innovation Excelle
Slide 8: Restructuring – achievements in 2009
Restructuring – achievements in 2009 Sustainable NWC reduction Net Working Capital reduced by CHF 463 million in 2009 NWC level of 21.1% by year-end, below target of 24% CASH Cash flow from operations reached CHF 757 million, predominantly as a result of tight NWC management Personnel cost red
Slide 9: The GANO projects will lead to a structural improvement of the site network
The GANO projects will lead to a structural improvement of the site network Europe North Pontypridd Asia America Höchst AZO Closure Huningue Gendorf MPP Muttenz T,P Onsan1) Partial closure Transfers Cuernavaca (CIVAC) Thane Latin America Resende dyes Approximately 1 000 – 1 100 job positions affec
Slide 10: Agenda
Agenda Full-year 2009 in review Business Unit profiles Outlook Public Nomura Chemicals Conference, Dublin, 18/19 March 2010 (Copyright Clariant. All rights reserved.) Slide 10 / 51
Slide 11: Ten new Business Units
Ten new Business Units Business Unit % of group sales 2009 selected competitors Industrial & Consumer Specialties 21% BASF, Cognis, Croda, Evonik Masterbatches 17% Ampacet, PolyOne, Schulman Pigments 16% BASF, DIC/SUN Textile Chemicals 12% BASF, Dystar, Huntsman, Long Shen Oil & Mining Services 9% B
Slide 12: Business Unit profiles and markets – Industrial & Consumer Services, Masterbatches
Business Unit profiles and markets – Industrial & Consumer Services, Masterbatches Industrial & Consumer Profile: Specialties The Industrial & Consumer Specialties (ICS) Business Unit is a global leader in 21% of group sales 2009* ethylene oxide derivatives and specialty chemicals for a large variet
Slide 13: Business Unit profiles and markets – Pigments, Textile Chemicals
Business Unit profiles and markets – Pigments, Textile Chemicals Pigments Profile: Clariant’s Pigments Business Unit is a leading global provider of organic 16% of group sales 2009* pigments, pigment preparations and dyes used in coatings, printing, plastics, and other specialty applications Markets
Slide 14: Business Unit profiles and markets – Oil & Mining Services, Paper Specialties
Business Unit profiles and markets – Oil & Mining Services, Paper Specialties Oil & Mining Services Profile: The Oil & Mining Services Business Unit is a leading provider of products and 9% of group sales 2009* services to the oil, refinery and mining industries Markets: Oil: exploration additives /
Slide 15: Business Unit profiles and markets – Additives, Detergents & Intermediates
Business Unit profiles and markets – Additives, Detergents & Intermediates Additives Profile: Clariant’s Additives Business Unit is a major supplier of functional effects for 6% of group sales 2009* plastics, coatings and printing inks Markets: coatings / plastics / printing inks / specialized appli
Slide 16: Business Unit profiles and markets – Leather Services, Emulsions
Business Unit profiles and markets – Leather Services, Emulsions Leather Services Profile: The Business Unit Leather Services is a leading supplier of leather chemicals 4% of group sales 2009* and services. The BU offers chemical and technical solutions for the complete leather manufacturing process
Slide 17: New segment reporting as of the first quarter 2010
New segment reporting as of the first quarter 2010 Seven reporting segments after reorganization into ten Business Units (BU): Sales 2009 in CHF million* % of Sales 2009 BU Industrial & Consumer Specialties 1 424 21% BU Masterbatches 1 123 17% BU Pigments 1 072 16% BU Textile Chemicals 777 12% BU Oi
Slide 18: Agenda
Agenda Full-year 2009 in review Business Unit profiles Outlook Public Nomura Chemicals Conference, Dublin, 18/19 March 2010 (Copyright Clariant. All rights reserved.) Slide 18 / 51
Slide 19: Our roadmap – three steps to build a solid platform for profitable growth
Our roadmap – three steps to build a solid platform for profitable growth Timeline < 2009 > 2010 Restructuring Focus Continuous improvement Profitable growth Actions Project Clariant Clariant Excellence Growth & Opportunities Cash generation People Excellence Innovation Excellence Cost cutti
Slide 20: Outlook – business conditions
Outlook – business conditions Environment No sustained recovery of the global economy Positive impulses from Asia and Latin America Continuing weakness in Europe and North America Raw material costs to rise slightly Public Nomura Chemicals Conference, Dublin, 18/19 March 2010 (Copyright Clar
Slide 21: Outlook – Clariant
Outlook – Clariant Cash generation and further cost reductions remain top priorities to: – address the unsatisfactory performance relative to peers – weather the global economic crisis – build a sustainable platform for continuous improvement and profitable growth after 2010 2010 guidance: Low s
Slide 22: Calendar of upcoming corporate events
Calendar of upcoming corporate events 29 March 2010 Annual General Meeting, Basel 29 April 2010 First Quarter Results 2010 29 July 2010 Second Quarter Results 2010 03 November 2010 Third Quarter Results 2010 16 February 2011 Full-year Results 2010 Public Nomura Chemicals Conference, Dublin, 18/19 Ma
Slide 23: IR contacts
IR contacts Dr. Ulrich Steiner Head of Investor Relations Phone +41 (0) 61 469 67 45 Mobile +41 (0) 79 297 27 07 email [email protected] Jaideep Pandya Investor Relations Officer Phone +41 (0) 61 469 67 49 Mobile +41 (0) 79 702 97 41 email [email protected] Edith Schwab Phone +41
Slide 24: Backup slides full-year / fourth quarter results 2009
Backup slides full-year / fourth quarter results 2009 Public Nomura Chemicals Conference, Dublin, 18/19 March 2010 (Copyright Clariant. All rights reserved.) Slide 24 / 51
Slide 25: Full-year – Key financials
Full-year – Key financials Full-year 2009 2008 CHF million % of sales CHF million % of sales Sales 6 614 8 071 Local currency growth (LC) -14% - Organic growth rate* -14% - Acquisitions/Divestments 0% Currencies -4% Gross profit 1 865 28.2% 2 314 28.7% EBITDA before exceptionals 495 7.5% 783 9.7% EB
Slide 26: Full-year sales – regional view
Full-year sales – regional view FY/09 FY/08 Sales growth in local currencies –14% +1% Sales mix: Asia / Australia Total sales FY/09: CHF 6 614 million – Volume –14% Africa – Price 0% 1 748 – Acq./div. 0% Europe 2 936 – Currency –4% -8% including -19% More than 40% of sales in emerging China -1%
Slide 27: Full-year – Sales and EBITDA margins by divisions
Full-year – Sales and EBITDA margins by divisions Full-year 2009 Sales EBITDA* EBITDA Margin in %* CHF million % LC in % of Group 2009 2008 Textile, Leather & Paper Chemicals 1 648 -13% 15 5.6 7.5 Pigments & Additives 1 459 -22% 21 8.6 15.0 Masterbatches 1 122 -8% 17 9.4 9.5 Functional Chemicals 2 3
Slide 28: Full-year – Cash flow
Full-year – Cash flow Full-year 2009 2008 CHF million CHF million Net loss / income -194 -37 Depreciation, amortization and impairment 283 462 Other 107 118 Payments for restructuring -182 -81 Operating cash flow before working capital changes 14 462 Changes in working capital and provisions 743 -71
Slide 29: Full-year – Financial result
Full-year – Financial result Full-year 2009 2008 CHF million CHF million Interest income 7 14 Other financial income 3 3 Total financial income 10 17 Interest expenses -80 -85 Other financial expenses -14 -17 Currency result, net -17 -53 Total financial expenses -111 -155 Total financial result -101
Slide 30: Textile, Leather & Paper Chemicals – full-year
Textile, Leather & Paper Chemicals – full-year Full-year 2009 2008 Change CHF million % of sales CHF million % of sales % CHF % LC Sales 1 648 2 020 -18 -13 EBITDA before exceptionals 92 5.6 152 7.5 -39 -29 Operating income before exceptionals 44 2.7 87 4.3 -49 -34 Operating income 20 1.2 -131 -6.5
Slide 31: Pigments & Additives – full-year
Pigments & Additives – full-year Full-year 2009 2008 Change CHF million % of sales CHF million % of sales % CHF % LC Sales 1 459 1 948 -25 -22 EBITDA before exceptionals 125 8.6 293 15.0 -57 -54 Operating income before exceptionals 58 4.0 216 11.1 -73 -71 Operating income -50 -3.4 198 10.2 - - Busin
Slide 32: Masterbatches – full-year
Masterbatches – full-year Full-year 2009 2008 Change CHF million % of sales CHF million % of sales % CHF % LC Sales 1 122 1 278 -12 -8 EBITDA before exceptionals 105 9.4 122 9.5 -14 -8 Operating income before exceptionals 74 6.6 89 7.0 -17 -9 Operating income 37 3.3 76 5.9 -51 -46 Business trends
Slide 33: Functional Chemicals – full-year
Functional Chemicals – full-year Full-year 2009 2008 Change CHF million % of sales CHF million % of sales % CHF % LC Sales 2 385 2 825 -16 -11 EBITDA before exceptionals 283 11.9 316 11.2 -10 -3 Operating income before exceptionals 217 9.1 249 8.8 -13 -5 Operating income 183 7.7 236 8.4 -22 -15 Busi
Slide 34: Fourth quarter – Key financials
Fourth quarter – Key financials Fourth quarter 2009 2008 CHF million % of sales CHF million % of sales Sales 1 710 1 744 Local currency growth (LC) 2% - Organic growth rate* 2% - Acquisitions/Divestments 0% Currencies -4% Gross profit 506 29.6% 440 25.2% EBITDA before exceptionals 164 9.6% 104 6.0%
Slide 35: Fourth quarter – rebound in China; Europe at previous year's level
Fourth quarter – rebound in China; Europe at previous year’s level Q4/09 Q4/08 Sales growth in local currencies +2% –9% Sales mix: Total sales Q4/09: CHF 1 710 million – Volume +8% Asia / Australia – Price –6% Africa 465 Europe – Acq./div. 0% 761 – Currency –4% +15% including China 0% 102 +71% P
Slide 36: Fourth quarter – Sales and EBITDA margins by divisions
Fourth quarter – Sales and EBITDA margins by divisions Fourth quarter 2009 Sales EBITDA* EBITDA Margin in %* CHF million % LC in % of Group 2009 2008 Textile, Leather & Paper Chemicals 431 5% 16 7.4 2.6 Pigments & Additives 379 6% 23 11.6 12.4 Masterbatches 280 13% 12 8.6 3.1 Functional Chemicals 62
Slide 37: Fourth quarter – idle facility costs and inventory devaluation
Fourth quarter – idle facility costs and inventory devaluation Q4/09 Q4/08 33.0% -3.2% -0.2% 29.9% Q1/09: –6.3% -6.8% Q1/09: –3.6% 29.6% Q2/09: –3.9% Q2/09: –1.2% Q3/09: –2.4% Q3/09: –1.0% 2.1% 25.2% Gross margin before inventory Idle facility Inventory Gross margin valuation and capacity costs deva
Slide 38: Increased focus on sales prices as raw material costs rise
Increased focus on sales prices as raw material costs rise Raw material costs were 14% lower 15% Raw material costs increase, quarter-on-quarter compared to Q4 2008, but 2% 10% higher compared to Q3 2009 5% 0% Positive contribution to the gross -5% margin from lower raw material -10% costs and a
Slide 39: Fourth quarter – Cash flow
Fourth quarter – Cash flow Fourth quarter 2009 2008 CHF million CHF million Net loss / income -67 -207 Depreciation, amortization and impairment 80 250 Other 54 46 Payments for restructuring -51 -19 Operating cash flow before working capital changes 16 70 Changes in working capital and provisions 20
Slide 40: Fourth quarter – Financial result
Fourth quarter – Financial result Fourth quarter 2009 2008 CHF million CHF million Interest income 2 2 Other financial income 1 0 Total financial income 3 2 Interest expenses -19 -21 Other financial expenses -3 -3 Currency result, net 1 -18 Total financial expenses -21 -42 Total financial result -18
Slide 41: Textile, Leather & Paper Chemicals – fourth quarter
Textile, Leather & Paper Chemicals – fourth quarter Fourth quarter 2009 2008 Change CHF million % of sales CHF million % of sales % CHF % LC Sales 431 429 0 +5 EBITDA before exceptionals 32 7.4 11 2.6 +191 +215 Operating income before exceptionals 20 4.6 -5 -- -- -- Operating income 16 3.7 -189 -- -
Slide 42: Pigments & Additives – fourth quarter
Pigments & Additives – fourth quarter Fourth quarter 2009 2008 Change CHF million % of sales CHF million % of sales % CHF % LC Sales 379 370 +2 +6 EBITDA before exceptionals 44 11.6 46 12.4 -4 +5 Operating income before exceptionals 26 6.9 27 7.3 -4 +8 Operating income -47 -12.4 31 8.4 -- -- Busines
Slide 43: Masterbatches – fourth quarter
Masterbatches – fourth quarter Fourth quarter 2009 2008 Change CHF million % of sales CHF million % of sales % CHF % LC Sales 280 258 +9 +13 EBITDA before exceptionals 24 8.6 8 3.1 +200 +174 Operating income before exceptionals 18 6.4 0 0.0 -- -- Operating income 12 4.3 0 0.0 -- -- Business trends
Slide 44: Functional Chemicals – fourth quarter
Functional Chemicals – fourth quarter Fourth quarter 2009 2008 Change CHF million % of sales CHF million % of sales % CHF % LC Sales 620 687 -10 -9 EBITDA before exceptionals 96 15.5 80 11.6 +20 +23 Operating income before exceptionals 78 12.6 64 9.3 +22 +27 Operating income 53 8.5 59 8.6 -10 -9 Bus
Slide 45: Ample liquidity headroom available
Ample liquidity headroom available > CHF 2.5 bn financial CHF 1 140 million cash and cash headroom available at 1 140 equivalents as of end Q4/09, up from headquarters and in the countries CHF 995 million as of end Q3/09 CHF 400 million syndicated bank facility*; 400 undrawn; no intention to draw. C
Slide 46: Debt maturity profile as of 31 Dec 2009
Debt maturity profile as of 31 Dec 2009 Liquidity headroom Maturities of financial debt Bonds & Private Placements 2500 1000 Uncommitted & other loans 800 Open undrawn credit facilities at local affiliates 2000 800 874 Open undrawn credit facilities in Switzerland 200 1500 600 Backstop facility, Loc
Slide 47: Full-year – Sales and cost structure
Full-year – Sales and cost structure Global sales distribution in % Global cost distribution in % Emerging Emerging CHF 0 Markets CHF 6 Markets JPY 1 20 JPY 3 16 CHF 6 USD 31 USD 24 EUR 44 EUR 51 GBP 2 GBP 2 These distributions represent an approximation to total cash in- and outflows and are closel
Slide 48: Full-year – top five products in percentage of total raw material costs
Full-year – top five products in percentage of total raw material costs Ranking Product 1 Ethylene and -oxide 2 Polyethylene Group ~17% Total 3 Acetic anhydride 4 Propylene glycol 5 Sodium hydroxide Public Nomura Chemicals Conference, Dublin, 18/19 March 2010 (Copyright Clariant. All rights reserved
Slide 49: New organization as of 1 Jan 2010
New organization as of 1 Jan 2010 Executive Committee Corporate Center Business Units Business Services Group Technology Services BU Industrial & BU Paper Group Finance Consumer Group IT Services Specialties Services Specialties Group Technology Services Group HR Regional Logistics BU Pigments BU Ad
Slide 50: Roles of main organization units in overall setup of new corporate structure
Roles of main organization units in overall setup of new corporate structure Strategically and operationally manage the Group Executive Committee (EC) Ensure interests of customers, employees and shareholders Provide leadership; ensure implementation Act as staff to EC and Board of Directors
Slide 51: Disclaimer
Disclaimer This presentation contains certain statements that are neither reported financial results nor other historical information. This presentation also includes forward-looking statements. Because these forward-looking statements are subject to risks and uncertainties, actual future results ma