Solvay Sa · EURONEXT:SOLB
Solvay Sa — Shareholder Meeting (May 2024)
24 slides from Solvay Sa's shareholder meeting presentation, May 28, 2024
Slide 1: Ordinary General Shareholders' Meeting
Ordinary General Shareholders’ Meeting May 28, 2024 Philippe Kehren Chief Executive Officer
Slide 2: Seasoned Executive Leadership
Seasoned Executive Leadership Philippe Alexandre Lanny Mark Lisa Kehren Blum Duvall van Bijsterveld Brown Chief Executive Chief Finance & Chief Operations Officer Chief People General Officer Strategy Officer Officer Counsel
Slide 3: Safety at the heart of our operations
Safety at the heart of our operations RIIR (Reportable Injuries and Illness per 200,000 work hours) 0.40 (68) 0.27 0.27 (47) (46) 4 4 4 4 3 2 2 3 3 2 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2021 2022 2023 H-RIIR RIIR
Slide 4: Our people and our plants first!
Our people Record Redefining our culture and our engagement and who we are, involving plants first ! rate of 80% all stakeholders
Slide 5: We are Solvay
We are Solvay SOLVAY
Slide 6: A New Chapter: Our Ambition
A New Chapter Our Ambition We are mastering Consolidate #1 market position the elements Be THE benchmark on cost essential Sustain top quartile profitability and returns to our world Deliver carbon neutrality through process innovation
Slide 7: Essential to multiple end-markets
Leadership across Essential to multiple businesses end-markets 32% Soda Ash 10% 4% Electronics Resources, Environment & 22% Energy Industrial 13% Applications 11% & Chemical Coatis % Bicarbonate 13% industry % of Net Building & others of Net Sales 14% Sales 17% Special Chem1,2 18% Consumer goods, Ho
Slide 8: Founded on 4 strategic priorities
Founded on 4 strategic priorities Market Cost & Process Energy Capital Leadership Leadership Transition Discipline Leverage Drive Deliver Prioritize #1 position in Excellence & Carbon Cash generation every market competitiveness neutrality & dividends
Slide 9: Portfolio: 25% materially outpacing GDP
Portfolio : 25% materially outpacing GDP Highly Soda ash H 2O 2 Coatis Dispersible Silica Lithium carbonate used in Battery recycling Circular Silica Green solvents Batteries & urban mining (Rice Husk based) 15-20% 15-20% 15-20% 20-25% Bicarbonate e-H2O2 Rare Earth Process chemicals for Permanent ma
Slide 10: Separation drives new and faster cost savings
Separation drives new and faster cost savings Fixed costs reduction driven by ✓ operational excellence Manufacturing ✓ continued footprint optimization Variable costs improvement driven by €300 mn ✓ process innovation Cost reduction by 2028 An organization fit for purpose G&A with a simple ERP platfo
Slide 11: Our Sustainability Roadmap
Our Sustainability Roadmap CLIMATE BETTER LIFE -30% Scope 1 & 2 Safety RIIR 3 GHG Emissions 1 Aim for zero by 2030 Gender parity 4 -20% Scope 3 in 10 years GHG Emissions 1 by 2030 Living wage to Coal Phase out 2 100% of workforce CARBON NEUTRAL by 2030 by 2026 Scope 1 & 2 by 2050 1 Reference year 20
Slide 12: 27 energy transition projects (1.8 Mt of CO2 per year)
27 energy transition projects (1.8 Mt of CO2 per year) 60+ projects in energy efficiency (0.2 Mt of CO2 per year) = equivalent to taking 1.2 million cars off the road 1 site (NL) 2020 Energy transition 1 site (DE) 1 site (US) 2021, 2025 2020 Reduced primary 1 site (DE) 1 site (CN) energy source 2 site
Slide 13: Clear prioritization of Cash usage
Clear prioritization of Cash usage ~€ 4bn Levered pre-CAPEX cash flow Indicative over 2024-28 Priority 1 ➔ Sustenance Essential CAPEX ➔ Energy transition ~1/3 Priority 2 Stable to increasing’ policy Dividends ~1/3 ➔ Selective investment projects Priority 3 ➔ Deleveraging More value creation ~1/3 ➔ Fu
Slide 14: Performance & outlook
Performance & outlook
Slide 15: Strategy in actions
Strategy in actions Recent developments Pursuing the development of a European rare earths hub for permanent magnets Star-Factory: building the plants of the future Coal phase-out in Green River e.Soda pilot - preparing the future of soda ash Cautious capital spending
Slide 16: Full year 2023 results
Full year 2023 results Another year of leadership and resilience € € € € 4.9bn 1.2bn 0.6bn 1.5bn 20.4% NET SALES Underlying EBITDA FCF1 Underlying Net Debt ROCE2 -12.6% yoy +0.2% organic 45% FCF conversion 1.2x leverage 2 -2.5pp 25.5% EBITDA margin last 12 months 1 To Solvay shareholders from contin
Slide 17: Strong FCF generation
Strong FCF generation €561m in 2023 Supported by EBITDA and working capital vs €479m in 2022 Solid EBITDA Performance Capex Working Provisions capital Financing Taxes and other Positive impact from lower working capital softer demand around year end EBITDA FCF + simplification of portfolio FY 2023 FY
Slide 18: Two pillars of our financial policy
Investment grade Two pillars of our financial policy 01 confirmed Target capital structure delivered Actual ⤷ Net debt: slightly lower from cash € billion CMD view 31/12/2023 phasing (separation costs) expected confirmed Rating to be BBB- BBB- ⤷ Provisions (employee benefits and Gross Debt 2.2 2.2 envir
Slide 19: 2023 ESG performance demonstrates strong progress on climate and better life
2023 ESG performance demonstrates strong progress on climate and better life Drastically REDUCING OUR CO2 EMISSIONS with 27 energy transition projects 2023 2021 Progress Targets Scope 1 & 2 GHG Emissions (Mt) 7.3 9.0 -19% -30% by 2030 Scope 3 GHG Emissions (Mt) 12.4 14.7 -16% -20% by 2030 Coal Phase
Slide 20: Q1 2024 results
Q1 2024 results Strong FCF supported by resilient EBITDA, cost and capex discipline € € € € 1.2bn 265m 123m 1.6bn 19.8% NET SALES Underlying EBITDA FCF1 Underlying Net Debt ROCE2 -12% organic -14% organic 1.4x leverage2 last 12 months 22.1% EBITDA margin 1. To Solvay shareholders from continuing ope
Slide 21: Strong balance sheet stabilized with inaugural €1.5bn refinancing
Strong balance sheet stabilized with inaugural €1.5bn refinancing Dual tranches bond In €bn, as of Q1 2024 end S&P Rating confirmed BBB- stable 4 year €750m Gross debt 2.3 7.5 year €750m Net debt 1.6 Net pension liabilities 0.7 3.875% coupon on 4y bond Environmental liabilities 0.5 4.250% coupon on 7.
Slide 22: Outlook: Expectations for 2024
Outlook Expectations for 2024 Underlying EBITDA organic growth 01 → ranging between compared to 2023 restated -10% to -20% Free Cash Flow1 greater than 02 → €260 million 1 Free cash flow to Solvay shareholders from continuing operations
Slide 23: Conclusion
Conclusion SOLVAY
Slide 24: Thank you
THANK YOU