Lanxess Ag · XETR:LXS
Lanxess — Lanxess Ag Ord — Q4 2024 Earnings Presentation
36 slides from Lanxess's earnings presentation, Mar 20, 2025
Slide 1: LANXESS – Q4 / FY 2024 results
LANXESS – Q4 / FY 2024 results Solid EBITDA pre and Free Cash Flow improvement Matthias Zachert, CEO Oliver Stratmann, CFO
Slide 2: Safe harbor statement
Safe harbor statement The information included in this presentation is being provided for informational purposes only and does not constitute an offer to sell, or a solicitation of an offer to purchase, securities of LANXESS AG. No public market exists for the securities of LANXESS AG in the United
Slide 3: Agenda
Agenda 1 Review Q4 & FY 2024 and outlook 2 Financial and business details Q4 and FY 2024 3 Appendix 3
Slide 4: Self-help measures and financial discipline drove operational improvement in 2024
Self-help measures and financial discipline drove operational improvement in 2024 + Successful FORWARD! cost savings: €110 m Improved profitability + Increased utilization + Solid free cash flow and net debt reduction + Secured long term liquidity (new RCF) Improved + Completion of portfolio tr
Slide 5: EBITDA pre improvement combined with cash generation amid still challenging environment
EBITDA pre improvement combined with cash generation amid still challenging environment EBITDA pre (€ m) Free cash flow 2024 512 614 +20% Operational performance €188 m FY 2023 FY 2024 Safety (LTIFR* / MAQ) Net financial debt 1.5 0.6 0.6 Top safety performance Reduction from €2.498 m to €2.381 m -5%
Slide 6: Solid free cash flow driven by improved operating result
Solid free cash flow driven by improved operating result Solid FCF of €188 m in 2024 FCF in € m NWC inflation 2019 2020 2021 2022 2023 2024 550 Pandemic, 350 Ukraine war, logistical constraints 150 -50 Significant -250 reduction of NWC in 2023 -450 Continued focus on free cash flow generation NWC =
Slide 7: Substantial leverage improvement already realized – further reduction in sight
Substantial leverage improvement already realized – further reduction in sight Delivering on path to leverage reduction Proceeds from URE divestiture 4.9x expected closing in April 2025 Net financial debt/ 4.1x EBITDA pre 3.9x Potential future monetization of Envalior stake ~3x Target threshold <2x
Slide 8: FY 2024: Cost savings and operational improvement against low prior year base
FY 2024: Cost savings and operational improvement against low prior year base Consumer Protection Specialty Additives Advanced Intermediates Most business units with positive Strong volume growth Significant volume increase, higher development Cost savings contributed utilization Agro busi
Slide 9: FY 2025: All segments are expected to contribute to our EBITDA pre improvement
FY 2025: All segments are expected to contribute to our EBITDA pre improvement Consumer Protection Specialty Additives Advanced Intermediates Results expected slightly to Results expected slightly above 2024 Results expected slightly above 2024 moderately above 2024 Contribution to growth fr
Slide 10: FY 2025 guidance: EBITDA pre of €600-650 m
FY 2025 guidance: EBITDA pre of €600-650 m Mid-point of guidance is currently most likely outcome in € m 600-650 614 ~10% Starting point for FY 2024 ~40 ~20 needs to be adjusted for: Contribution of BU Urethane Systems with expected closing in April 2025 (FY24 EBITDA pre ~€50 m) Pull-forward eff
Slide 11: FY 2025 guidance: EBITDA pre of €600-650 m
FY 2025 guidance: EBITDA pre of €600-650 m No significant change in demand expected Currently, economic growth indicators show slow Our view on development economic environment High likelihood of politically triggered economic turbulences FY 2025 EBITDA pre guidance: €600-650 m, including pr
Slide 12: Agenda
Agenda 1 Review Q4 & FY 2024 and outlook 2 Financial and business details Q4 and FY 2024 3 Appendix 12
Slide 13: LANXESS Group: Strong Q4 EBITDA pre growth driven by pre-buying in December and tight cost management
LANXESS Group: Strong Q4 EBITDA pre growth driven by pre-buying in December and tight cost management [€ m] Q4/2023 Q4/2024 Δ FY 2023 FY 2024 Δ Strong finish in Q4 Sales 1,436 1,483 3% 6,714 6,366 -5% EBITDA pre 97 159 64% 512 614 20% despite tough Margin 6.8% 10.7% 7.6% 9.6% environment Capex 132 1
Slide 14: Consumer Protection: Strong EBITDA pre improvement against a weak base
§ Consumer Protection: Strong EBITDA pre improvement against a weak base [€ m] Q4/2023 Q4/2024 Δ FY 2023 FY 2024 Δ Weak agro Sales 508 490 -4% 2,340 2,081 -11% EBITDA pre 50 86 72% 310 286 -8% business weighs Margin 9.8% 17.6% 13.2% 13.7% on volumes Capex 34 35 3% 87 88 1% Sales decline results fr
Slide 15: Specialty Additives: Results supported by customers' pre-buying in the U.S.
Specialty Additives: Results supported by customers’ pre-buying in the U.S. [€ m] Q4/2023 Q4/2024 Δ FY 2023 FY 2024 Δ Strong volumes Sales 492 525 7% 2,325 2,209 -5% EBITDA pre 41 48 17% 209 227 9% and cost savings Margin 8.3% 9.1% 9.0% 10.3% contribute Capex 45 56 24% 122 119 -2% Price decrease r
Slide 16: Advanced Intermediates: Improved earnings compared to exceptionally low prior year
Advanced Intermediates: Improved earnings compared to exceptionally low prior year [€ m] Q4/2023 Q4/2024 Δ FY 2023 FY 2024 Δ Leverage from Sales 372 406 9% 1,775 1,804 2% EBITDA pre 24 47 96% 121 210 74% utilization Margin 6.5% 11.6% 6.8% 11.6% improvement Capex 29 36 24% 80 86 8% Positive price d
Slide 17: Significant increase in earnings due to cost savings supported by pre-buying
Significant increase in earnings due to cost savings supported by pre-buying Sales increase results from higher P&L [€ m] Q4/2023 Q4/2024 yoy volumes Sales 1,436 (100%) 1,483 (100%) 3% Cost of sales reflect declining Cost of sales -1,204 (-84%) -1,178 (-79%) 2% input costs and savings Selling -2
Slide 18: Q4: Solid free cash flow generation
Q4: Solid free cash flow generation Profit before tax 2023 contained Cash flow [€ m] Q4/2023 Q4/2024 impairments Profit before tax -661 -68 Continued active working capital Result from investments accounted for management leads to cash inflow 29 24 using the equity method Continued discipline
Slide 19: Net financial debt further reduced
Net financial debt further reduced Balance sheet [€ m] 31.12.2023 31.12.2024 Higher total assets and equity mainly due to currency effects (USD) Total assets 9,665 9,711 Net financial debt further reduced by Equity 4,507 4,592 sound cash flow generation Pension provisions decreased due to Equi
Slide 20: Q4 2024: EBITDA pre improvements in all segments
Q4 2024: EBITDA pre improvements in all segments Sales [€ m] EBITDA pre [€ m] +3% +64% 1,436* 1,483* 159 CP -4% 490 508 86 97 +72% +7% 525 CP 50 SA 492 48 +17% SA 41 AI 372 +9% 406 47 AI 24 +96% Q4 2023 Q4 2024 All other -18 -22 segments Q4 2023 Q4 2024 * Total group sales including all other segmen
Slide 21: Q4 2024: Increase in all regions compared to exceptionally low base in 2023, esp. in Germany
Q4 2024: Increase in all regions compared to exceptionally low base in 2023, esp. in Germany Q4 2024 sales by region [%] Regional development of sales [€ m] Operational 1,483 development* 1,436 Asia/ Americas Pacific Asia/Pacific +2% 290 +2% 283 20 36 Americas 525 +2% 537 +1% 16 EMEA (excl. Germany)
Slide 22: Significant reduction in gross debt due to envisaged repayment of bond maturing in May 2025
Significant reduction in gross debt due to envisaged repayment of bond maturing in May 2025 Long-term financing secured Liquidity and maturity profile as per December 2024 [€ m] Average interest rate of financial Bond Bond Bond Bond Bond 1000 2025 2026 2027 2028 2029 liabilities ~1.0%* €500 m €5
Slide 23: FORWARD! program well on track: Already €110 m savings realized in 2024, €40 m to follow in 2025
FORWARD! program well on track: Already €110 m savings realized in 2024, €40 m to follow in 2025 Savings of FORWARD! program have been confirmed and are in execution Progress ~€150 m total recurring savings Majority of contracts for FTE reduction signed 2024 2025 Measure implementation according
Slide 24: Agenda
Agenda 1 Review Q4 & FY 2024 and outlook 2 Financial and business details Q4 and FY 2024 3 Appendix 24
Slide 25: Housekeeping items 2025
Housekeeping items 2025 FY 2025 Outlook (in € m) Capex ~330 Operational depreciation ~370 excluding ~€150 m of intangible amortization All other segments (EBITDA pre) -150 - 160 assuming closure of URE transaction in April 2025 Exceptionals ~60 thereof ~€15 m coming from URE divestment process
Slide 26: Stable dividend for 2024 proposed - continued focus on cost discipline and deleveraging
Stable dividend for 2024 proposed - continued focus on cost discipline and deleveraging Focused dividend policy [€] Stable dividend in line with market expectation 0.10 0.10 2023 2024 Due to our focus on deleveraging, the dividend proposal to the AGM for FY 2024 is €0.10* * Dividend proposal to the
Slide 27: Leading ESG rating providers continue to honor LANXESS' performance
Leading ESG rating providers continue to honor LANXESS’ performance Rating Rating Rating recently recently recently confirmed updated confirmed B AA AA AA AA A B- B- BBB C 2nd highest category for 4th time Prime status since 2020; B In total, 8 times on Climate A list Top 10% in DJSI World (13th yea
Slide 28: FY 2024: Improvement in results due to significant contribution from cost savings
FY 2024: Improvement in results due to significant contribution from cost savings Lower sales due to lower raw P&L [€ m] FY 2023 FY 2024 yoy material and energy prices Sales 6,714 (100%) 6,366 (100%) -5% Cost of sales reflect lower input Cost of sales -5,446 (-81%) -5,068 (-80%) 7% costs and sav
Slide 29: FY 2024: Solid cash generation due to improved operating result
FY 2024: Solid cash generation due to improved operating result Cash flow [€ m] FY 2023* FY 2024 Profit before tax 2023 contained impairments, 2024 continues to Profit before tax -947 -197 be burdened by Envalior contribution Result from investments accounted for 172 133 Improved non-cash at equ
Slide 30: FY 2024 exceptional items (on EBIT) mainly relate to M&A – significantly reduced vs PY
FY 2024 exceptional items (on EBIT) mainly relate to M&A – significantly reduced vs PY, further reduction to come [€ m] Q4 2023 Q4 2024 FY 2023 FY 2024 Excep. thereof Excep. thereof Excep. thereof Excep. thereof D&A D&A D&A D&A Strategic realignment and restructuring -114 -15 -8 0 -133 -20 -11 -2 (i
Slide 31: FY 2024: Advanced Intermediates with strong EBITDA recovery, Consumer Protection burdened by agro
FY 2024: Advanced Intermediates with strong EBITDA recovery, Consumer Protection burdened by agro Sales* [€ m] Consumer Specialty EBITDA pre [€ m] -5% Protection Additives +20% LPT 6,714 SGO RCH LAB 614 6,366 512 CP MPP 2,340 -11% 2,081 286 F&F PLA -8% CP 310 SA 2,325 -5% 2,209 Advanced 227 +9% Inte
Slide 32: FY 2024: Strong US footprint
FY 2024: Strong US footprint FY 2023 sales by region [%] Regional development of sales [€ m] Operational 6,714 development* 6,366 Asia/ Americas Asia/Pacific 1,282 Pacific -5% 1,224 -3% 19 35 2,362 -6% Americas -7% 2,204 16 -4% EMEA 1,972 -4% 1,895 (excl. Germany) Germany 30 EMEA (excl. Germany) Ger
Slide 33: Upcoming events 2025 - Proactive capital market communication
Upcoming events 2025 - Proactive capital market communication Mar Apr May Jun 20 FY 2024 Results 08 Q1 2025 Results 25 Jefferies Pan-European Mid-Cap 22 Annual Stockholders Meeting Conference London 26 J.P. Morgan European Chemicals 27 dbAccess European Champions Forum London Conference Frankfurt 33
Slide 34: Contact details Investor Relations
Contact details Investor Relations Ulrike Rockel Visit the IR website Head of Treasury & Investor Relations Tel.: +49 221 8885 5458 Mob.: +49 175 30 50458 E-Mail: ulrike.rockel@lanxess.com André Simon Thomas Kaiser Jens Ussler Head of Investor Relations Institutional Investors / Analysts Institution
Slide 35: Abbreviations
Abbreviations Consumer Protection Specialty Additives § MPP Material Protection Products PLA Polymer Additives F&F Flavors & Fragrances LAB Lubricant Additives Business SGO Saltigo RCH Rhein Chemie LPT Liquid Purification Technologies Advanced Intermediates All Other Segments AII Advanced Industrial
Slide 36: LANXESS
LANXESS Energizing Chemistry LANXESS Energizing Chemistry