Arkema Sa · EURONEXT:AKE
Arkema Sa — ODDO BHF Forum 2019
21 slides from Arkema Sa's conference presentation, Jan 11, 2019
Slide 1: ODDO BHF Forum, Lyon, 10 & 11 January 2019
ODDO BHF FORUM LYON, 10 & 11 JANUARY 2019
Slide 2: Third Quarter 2018 Results and 2018 Outlook
THIRD QUARTER 2018 RESULTS AND 2018 OUTLOOK
Slide 3: 3Q'18 Key Take-Aways
3Q’18 KEY TAKE-AWAYS +7.3% up YoY €2,167m sales +6.7% at constant scope and FX +5.4% up on excellent 3Q’17 (€355m) All time high EBITDA in 3Q €374m EBITDA Up YoY in all three divisions On track with FY guidance 17.3% EBITDA margin Resilient at high levels (17.6% in 3Q’17) +18% up YoY on higher EBITD
Slide 4: 3Q'18 Highlights
3Q’18 HIGHLIGHTS EBITDA REBIT ADJUSTED EPS NET DEBT In €m In €m In € In €m 24% +5.4% +7.3% +17.3% GEARING 1,372 374 355 2.44 1,167 265 247 2.08 3Q'17 3Q'18 3Q'17 3Q'18 3Q'17 3Q'18 30/06/18 30/09/18 4
Slide 5: 3Q'18 Key Figures
3Q’18 KEY FIGURES In €m (except EPS) 3Q’17 3Q’18 CHANGE Sales 2,019 2,167 +7.3% EBITDA 355 374 +5.4% EBITDA margin 17.6% 17.3% Recurring operating income (REBIT) 247 265 +7.3% REBIT margin 12.2% 12.2% Adjusted net income 158 186 +17.7% Net income – Group share 142 174 +22.5% Adjusted EPS (in euros)
Slide 6: 3Q'18 Sales Bridge
3Q’18 SALES BRIDGE SALES In €m Scope Volumes Price Currency of business +0.1% +6.6% +0.9% (0.3)% Strong base of Continued Integration of 3Q’17 actions to XL Brands and increase selling Nitta industrial Priority given to prices to recover adhesives price increases higher raw 2,019 over volumes materi
Slide 7: High Performance Materials (46% of Group Sales)
HIGH PERFORMANCE MATERIALS (46% OF GROUP SALES) 3Q’18 KEY FIGURES 3Q’18 SALES DEVELOPMENT 3Q’18 SALES BY BUSINESS LINE In €m 3Q’17 3Q’18 Change Volumes +0.5% Bostik Sales 955 987 +3.4% 25% 23% Prices +1.9% EBITDA 161 162 +0.6% Performance Additives Currency (1.0)% EBITDA margin 16.9% 16.4% 52% Techn
Slide 8: Industrial Specialties (30% of Group Sales)
INDUSTRIAL SPECIALTIES (30% OF GROUP SALES) 3Q’18 KEY FIGURES 3Q’18 SALES DEVELOPMENT 3Q’18 SALES BY BUSINESS LINE In €m 3Q’17 3Q’18 Change Volumes (3.3)% 13% PMMA Sales 594 646 +8.8% 31% Prices +11.4% Thiochemicals EBITDA 149 165 +10.7% 32% Fluorogases Currency +0.6% EBITDA margin 25.1% 25.5% 24% H
Slide 9: Coating Solutions (24% of Group Sales)
COATING SOLUTIONS (24% OF GROUP SALES) 3Q’18 KEY FIGURES 3Q’18 SALES DEVELOPMENT 3Q’18 SALES BY BUSINESS LINE In €m 3Q’17 3Q’18 Change Volumes +3.5% Sales 463 527 +13.8% Prices +10.2% Coating Resins 45% and Additives EBITDA 62 65 +4.8% 55% Currency +0.1% EBITDA margin 13.4% 12.3% Acrylics Rec. opera
Slide 10: 3Q'18 Cash Flow
3Q’18 CASH FLOW In €m 3Q’17 3Q’18 3Q’18 highlights EBITDA 355 374 In a context of higher raw material costs Change in working capital (1) 94 65 16.1% WC over annualized sales ratio versus 15.5% at 30/09/17 and 16.8% at 30/09/16 Change in fixed assets payables (1) 4 9 Current taxes (50) (45) US tax r
Slide 11: 2018 Outlook
2018 OUTLOOK Macro-economic environment should remain contrasted ● Different dynamics by end-markets and regions ● Geopolitical tensions ● High raw material prices Arkema will continue to focus on internal drivers ● Innovation in advanced materials ● Integration of bolt-on acquisitions in adhesives
Slide 12: Arkema Highlights
ARKEMA HIGHLIGHTS INNOVATIVE “@& CHEMISTRY
Slide 13: Arkema in a Nutshell
ARKEMA IN A NUTSHELL 2017 KEY FIGURES €8.3 sales bn 19,800 employees worldwide Worldwide presence in 55 countries 136industrial sites 3 R&D & innovation geographical hubs BALANCED PORTFOLIO OF BUSINESSES AND GEOGRAPHIC FOOTPRINT Coating 23% Solutions 38% Europe 24% Bostik High North Performance 46%
Slide 14: Track Record of Delivering Financial Targets
TRACK RECORD OF DELIVERING FINANCIAL TARGETS 2017 TARGETS SET 3 YEARS AGO ACHIEVED IN 2017 DURING OUR 2015 CAPITAL MARKETS DAY EBITDA €1.3 bn €1,391 m from €784 m in 2014 Net cash flow* x3 x4 vs 2014 EBITDA to free cash conversion 35% 41% from 18% in 2014 Capital intensity (recurring capex to sales)
Slide 15: Reminder of 2023 Long-Term Objectives from 2017 Capital Markets Day
REMINDER OF 2023 LONG-TERM OBJECTIVES PRESENTED AT 2017 CAPITAL MARKETS DAY A global specialty player focused on Delivering strong margins and adhesives and advanced materials cash generation Bostik 2023 objectives Exceed 1/3 of Group sales REBIT margin EBITDA to free cash More than double sales vs
Slide 16: Long Term Growth Supported by a New Wave of Significant Projects
LONG TERM GROWTH SUPPORTED BY A NEW WAVE OF SIGNIFICANT PROJECTS 2018 2019 2020 2021 Start-up +20% PVDF Kynar® 90kt acrylic acid reactor Doubling of thiochemicals production capacities at Clear Lake capacities +50% global PA11 monomer and Markets : new energies, Markets : paints, coatings, Markets :
Slide 17: Major Step Supporting the Growth of High Performance Polymers
MAJOR STEP SUPPORTING THE GROWTH OF OUR HIGH PERFORMANCE POLYMERS Planned expansions Arkema’s products Polymers not produced by Arkema 2018 PEKK New plant (US) PEEK PEI April 2018 PVDF High-performance +20% US production capacities polymers Rilsan® HT PPS Pebax® Rnew ® PA11 Rilsan® Clear 2021 Orgaso
Slide 18: Corporate Social Responsibility at the Heart of Our Strategy
CORPORATE SOCIAL RESPONSIBILITY AT THE HEART OF OUR STRATEGY OCCUPATIONAL GREENHOUSE GAS VOLATILE ORGANIC CHEMICAL OXYGEN NET ENERGY Safety SAFETY (TRIR) Environment EMISSIONS COMPOUND DEMAND PURCHASED A RESPONSIBLE Be a top quartile Reduce the safety performer 2025 <1.2 environmental 2025 -50% -33%
Slide 19: Best-in Class Cash Conversion
BEST-IN CLASS CASH CONVERSION €2.7 BN FREE CASH BEFORE CAPEX STRONG FREE CASH FLOW GENERATION* GENERATED OVER 2015-2017 In €m Use of cash CAPEX M&A Dividend 575 442 426 €1.3 bn €2 bn net €0.4 bn Acquisitions Bostik, Den Braven and CMP % of EBITDA 18% 42% 36% 41% Divestments 145 Sunclear, activated c
Slide 20: Significant Increase in Dividend
SIGNIFICANT INCREASE IN DIVIDEND DIVIDEND in €/share +12% CAGR 2.30 2.05 Reflects the strong confidence of 1.80 1.85 1.85 1.90 the Board in the current level of profitability and long-term growth 1.30 prospects 1.00 ~30% payout ratio 0.75 0.60 0.60 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2
Slide 21: 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