Dsm-firmenich Ag · EURONEXT:DSFIR
Dsm-firmenich — Royal DSM — FY2019 Earnings Presentation
29 slides from Dsm-firmenich's earnings presentation, February 2020
Slide 1: Royal DSM
ROYAL DSM NUTRITION HEALTH SUSTAINABLE LIVING
Slide 2: CEO statement
CEO statement “We are pleased to have delivered a good financial performance, as well as achieving our key milestones in the first year of Strategy 2021. Given the softer trading conditions seen in some of our markets, we are focused on driving growth, costs and operational excellence initiatives ac
Slide 3: Highlights full year 2019
Highlights full year 2019 = DSM reports another good year = Results compared to underlying business in 2018: v Group sales: +2%, Adjusted EBITDA up 10% (including 3% from IFRS 16) v Nutrition: sales +5%, organic sales +2%, Adjusted EBITDA up 12% (including 3% from IFRS 16) v_ Materials: sales -6%, v
Slide 4: Highlights Q4 2019
Highlights Q4 2019 = DSM reports a solid Q4 = Group sales -3%, Adjusted EBITDA up 7% (including 4% from IFRS 16) = Nutrition: sales +1%, organic sales -1%, Adjusted EBITDA up 9% (including 3% from IFRS 16) = Materials: sales -9%, volume -6%, Adjusted EBITDA -1% (including 2% from IFRS 16)
Slide 5: Key financials full year 2019
Key financials full year 2019 Comparison with full year 2018 Underlying business in € million Full year Full year % Change 2019 2018 Underlying’ Temp. Total! Underlying’ FX& Underlying’ Temporary Total business vitamin Group Organic ‘other” total vitamin Group effect growth growth effect Sales 9,010
Slide 6: Key financials Q4 2019
Key financials Q4 2019 Comparison with Q4 2018 Underlying business in € million i 42019 | Q4 2018 % Change i | Underlying’ Temp. Total; Underlying’ FX & Underlying’ Temporary Total i business vitamin Group Organic ‘other” total vitamin Group H | effect growth growth effect Sales i 2,208 - 2,208 5% 2
Slide 7: Key financials
Key financials vitamin effect Comparison with 2018 including temporary Full year ee IFRS 16 impact, 2019 2018 +% Change 04 2019 042018 % Change Sales 9,010 9,267 -3% 2,152 2,208 -3% Adjusted EBITDA 1,684 1,822 -8% 396 370 7% Adjusted EBITDA margin 18.7% 19.7% 18.4% 16.8% ROCE (%) 12.0% 16.8% Effecti
Slide 8: Nutrition full year and Q4 financials
Full year in € million (estimated) 2019 2018 ▪ Sales 6,028 5,722 5% Adjusted EBITDA1 1,250 1,117 12% Adjusted EBITDA margin (%) 1 20.7% 19.5% ROCE (%) 13.9% 14.9% temp. vit.effect in € million (estimated) 2018 Sales 415 Adjusted EBITDA 290 Full year in € million 2019 2018 % Change Q4 2019 Q4 2018 %
Slide 9: Nutrition | Business overview
Nutrition | Business overview Sales bridge | FY 2018 to FY 2019 (€m) 6,028 -—— 0% = 5,722 = full year Volume Pricemmix FX — Other full year 2018 2019 Sales bridge | Q4 2018 to Q4 2019 (€m) a4 Volume Price/mix FX Other Q4 2018 2019 Full year 2019 sales: Sales were 5% higher compared to 2018, with 2%
Slide 10: DSM has launched a program in Nutrition to drive above market profitable growth
▪ DSM has launched a program in Nutrition to drive above market profitable growth through increasing its agility ▪ By simplifying the operating model and further improving business steering, the program aims to better serve customers and respond to the differentiated needs of their respective end ma
Slide 11: Animal Nutrition & Health | Sales overview
Animal Nutrition & Health | Sales overview Sales bridge | FY 2018 to FY 2019 (€m) 2,749 * full Volume Price/mix FX Other —_fulll year year 2018 2019 Sales bridge | Q4 2018 to Q4 2019 (€m) 715 Q4 Volume Pricefmix FX Other = Q4 2018 2019 Full year 2019 sales: Animal Nutrition reported 4% organic growt
Slide 12: Human Nutrition & Health | Sales overview
Human Nutrition & Health | Sales overview Sales bridge | FY 2018 to FY 2019 (€m) PL | EZ Volume Pricemix FX Other — full year year 2018 2019 Sales bridge | Q4 2018 to Q4 2019 (€m) 5% 457 Q4 Volume Priceimix FX Other Q4 2018 2019 Full year 2019 sales: Human Nutrition delivered 3% sales growth driven
Slide 13: Other Nutrition activities
Other Nutrition activities Food Specialties: Full year 2019 sales were 17% higher versus the previous year, resulting from 4% organic growth, 12% from the consolidation of Andre Pectin following the increase in DSM’s shareholding from 29% to 75% and 1% from exchange rate effects.. All major business
Slide 14: Materials | Sales overview
Materials | Sales overview Sales bridge | FY 2018 to FY 2019 (€m) = Full year 2019 sales Materials reported minus 8% organic growth, with volumes recording minus 5% and prices minus 3%. The lower prices fully reflect lower input costs. v_ DSM Engineering Plastics reported minus 10% organic growth. T
Slide 15: Materials full year and Q4 financials
Full year in € million 2019 2018 % Change Q4 2019 Q4 2018 % Change Sales 2,746 2,913 -6% 632 698 -9% 1 Adjusted EBITDA 509 512 -1% 118 119 -1% 1 Adjusted EBITDA margin (%) 18.5% 17.6% 18.7% 17.0% Adjusted EBIT 363 383 -5% 78 85 -8% Capital Employed 1,927 1,878 Average Capital Employed 1,951 1,856 RO
Slide 16: Innovation Center full year and Q4 financials
Full year in € million 2019 2018 % Change Q4 2019 Q4 2018 % Change Sales 194 172 13% 54 54 0% 1 Adjusted EBITDA 22 8 6 7 Adjusted EBIT -19 -14 -8 2 Capital Employed 616 597 ▪ ▪
Slide 17: Corporate Activities full year and Q4 financials
Full year in € million 2019 2018 Q4 2019 Q4 2018 Sales 42 45 11 12 1 Adjusted EBITDA -97 -105 -22 -26 Adjusted EBIT -150 -135 -33 -35 ▪
Slide 18: Adjusted Net Operating Free Cash Flow
Full year in € million 2019 2018 Q4 2019 Q4 2018 Cash provided by Operating Activities 1,385 1,391 444 458 - Cash from APM adjustments 57 94 20 28 - Cash from capital expenditures* -627 -655 -207 -203 - Cash from drawing rights -14 -20 -6 -2 Adjusted Net Operating Free Cash Flow 801 810 251 281 Adju
Slide 19: Net debt and ROCE | overview
Net debt and ROCE | overview Net debt ROCE (underlying business including IFRS 16) 1,600 30.0 (ry 2018 ry 2019 1,144 20.6 1,200 19.9 18.6 16.8 13. 800 15.0 12.0 2 400 113 0 FC . End of Year 2018 End of Year 2019 Total DSM Nutrition Materials = Net debt was €1,144 million, up from €113 million at the
Slide 20: Outlook 2020
Outlook 2020 = DSM expects to deliver a mid-single digit increase in Adjusted EBITDA for 2020 compared to prior year, together with an improvement in Adjusted Net Operating Free Cash Flow in line with our Strategy 2021 targets. This outlook is driven by DSM’s own growth initiatives, innovation progr
Slide 21: Share Buy Back program
Share Buy Back program = DSM announced on 14 February 2019 a repurchase of shares with an aggregate market value of €1 billion, with the intention to reduce its issued capital. In 2019 DSM has repurchased 5.4 million shares for a total consideration of €600 million under this program. DSM intends to
Slide 22: Progress on Strategy 2021
Progress on Strategy 2021: Growth & Value - Purpose led, Performance driven
Slide 23: Purpose sets the scope for further growth and evolution
Purpose sets the scope for further growth and evolution Strategy 2021: Growth & Value - Purpose led, Performance driven Our competences provide growth creating a growth with targets that underpin and purpose... > opportunities in > company... > our mission. the focus domains... DSM’s key competences
Slide 24: DSM delivered on its key financial targets
DSM delivered on its key financial targets .. 2021 targets ' Ambitions underpinning our targets ' High single-digit 1. Sales Above-market sales growth for Total DSM, Nutrition and Materials percentage annual Adjusted EBITDA 2. Adjusted EBITDA margin Nutrition: >20% W increase Materials: 18-20% W ~10
Slide 25: as well as on its sustainability ambitions
as well as on its sustainability ambitions Continued step-up in sustainability leadership Realization 7 © 0%) © © 20] so) 2019 GHG Energy Purchased Employee Safety Female Brighter structural efficiency renewable engagement Frequency executives Living improvement improvement electricity favorable Rec
Slide 26: DSM made strides in its large innovation programs
DSM made strides in its large innovation programs 2 | (‘Sen AVANSYA DSM filed for European registration to commercialize its ‘Clean Cow’ product, targeted for late 2020/early 2021. This feed additive reduces methane emissions from ruminants by about 30%. Veramaris started the commercial production o
Slide 27: Sustainability performance recognized in ESG benchmarks
Sustainability performance recognized in ESG benchmarks Corporate ESG MSCl i) sustainaurrics sink EURONEXT rare VIDEO iri “cme ISS ESG> 8 iris INDICES = DSM further improved its rankings in key ESG (Environmental, Social & Governance) indices, achieving leading positions in four important ESG indice
Slide 28: Safe harbor
Safe harbor This presentation may contain forward-looking statements with respect to DSM’s future performance and position. Such statements are based on current expectations, estimates and projections of DSM and information currently available to the company. DSM cautions readers that such statement
Slide 29: Slide 29