Covestro AG · VIE:1COV
Covestro — Q1 2017 Earnings Presentation
16 slides from Covestro's earnings presentation, Apr 25, 2017
Slide 1: Strong momentum continues – Financial Highlights Q1 2017
Strong momentum continues Financial Highlights Q1 2017 covestro.com │ April 25, 2017 │ Q1 2017 Investor Conference Call 1
Slide 2: Forward-looking statements
Forward-looking statements This presentation may contain forward-looking statements based on current assumptions and forecasts made by Covestro AG. Various known and unknown risks, uncertainties and other factors could lead to material differences between the actual future results, financial situati
Slide 3: Q1 2017 Key Highlights
Q1 2017 Key Highlights Strong momentum continues Continued dynamic core volume growth (9.0% Y/Y) 9th consecutive quarter with Y/Y EBITDA improvement (€846m; 67% Y/Y) Net income increase to €468m (157% Y/Y) FOCF increase to €211m (174% Y/Y) Increase of guidance for FY 2017 3 │ April 25, 2017 │ Q1 201
Slide 4: Q1 2017 – Sales per Region
Q1 2017 – Sales per Region Improving European business Solid development in Q1 2017 Highlights in € million / Core volume growth Y/Y EMLA • Double-digit volume growth in Germany, mainly driven China by PUR and PCS 753 Vol. +18% • Strong rebound in Latin America APAC 1,177 APAC Vol. +13% EMLA • Doubl
Slide 5: Q1 2017 – Sales Bridge
Q1 2017 – Sales Bridge Strong volume growth and reflation Sales Bridge Highlights in € million +40 3,586 Dynamic volume development +385 FX • Core volume growth (in kt) of 9.0% Y/Y • Sales volumes (in €) expansion of 9.9% Y/Y +286 Price • Sales volume expansion above core volume growth due to produc
Slide 6: Q1 2017 – EBITDA Bridge
Q1 2017 – EBITDA Bridge Strong volume leverage and positive pricing delta EBITDA Bridge Highlights in € million Pricing Delta Positive volume leverage +€254m +385 -131 • Broad-based in all three business segments -49 Improving cash margin Raw 846 Material Other Price items • Positive pricing delta d
Slide 7: Q1 2017 – Group Results
Q1 2017 – Group Results Continued margin expansion Net Sales and Core Volume Growth Q1 2017 Highlights in € million / changes Y/Y 8.4% 7.7% 9.1% 9.0% • Strong core volume growth (in kt) of 9.0% 7,000 10.0% 4.8% 6,000 5.0% driven by strong end market growth and partial 5,000 4,000 0.0% re-stocking -5
Slide 8: Q1 2017 – PUR Segment – Results
Q1 2017 – PUR Segment – Results Polyurethanes – Structurally improving margins in MDI Net Sales and Core Volume Growth Q1 2017 Highlights in € million / changes Y/Y 4,000 20.0% • Core volume growth of 6.8% Y/Y mainly driven 10.3% 9.0% 9.0% 3,500 3,000 6.8% 15.0% 10.0% by strong MDI and TDI, whereas
Slide 9: Q1 2017 – PCS Segment – Results
Q1 2017 – PCS Segment – Results Polycarbonates – Steady high margin business Net Sales and Core Volume Growth Q1 2017 Highlights in € million / changes Y/Y 2,500 11.6% 12.8% 14.7% 20.0% • Core volumes increased double-digit by 14.7% 15.0% 8.5% 8.5% 2,000 10.0% • Broad-based acceleration of demand gr
Slide 10: Q1 2017 – CAS Segment – Results
Q1 2017 – CAS Segment – Results Coatings, Adhesives, Specialties – Solid results Net Sales and Core Volume Growth Q1 2017 Highlights in € million / changes Y/Y 1,200 8.1% 10.0% • Dynamic core volume growth of 8.1% Y/Y due 3.5% 1,000 -1.8% 0.0% 5.0% to strong growth in APAC and EMLA 800 -2.8% 0.0% 60
Slide 11: Q1 2017 – Free Operating Cash Flow
Q1 2017 – Free Operating Cash Flow Solid FOCF in a seasonally low quarter Free operating cash flow development Highlights in € million • Working capital to sales ratio* at 18.1%, slightly FOCF 90 -14% 77 +174% 211 above the targeted range of 15-17% due to higher valuation of stocks and higher receiv
Slide 12: Q1 2017 – Total Net Debt
Q1 2017 – Total Net Debt Strong balance sheet Total net debt – end of Q1 2017 Highlights in € million • Total net debt to EBITDA ratio* slightly reduced 2,708 to 1.1x 22 0 30 2,484 • Pension provisions decreased slightly to -211 -65 €1,144m due to higher interest rates 1,499 • Equity ratio further i
Slide 13: Guidance 2017
Guidance 2017 Strong momentum continues FY 2016 Guidance FY 2017* New Guidance FY 2017* Low- to mid-single-digit percentage increase Core Volume Growth +7.5% Unchanged Y/Y Slightly above the average of the last three Significantly above the average of the last FOCF €1,367m years three years ROCE 14.
Slide 14: First bio-based automotive 2K PU clearcoat tested
First bio-based automotive 2K PU clearcoat tested Audi: Successful near-series trial / BASF: Satisfied with performance • Successful coating of Audi Q2 under near-series conditions • Based on proven 2K PU technology fulfilling high performance standards • Application on existing coating lines possib
Slide 15: Q1 2017 – Summary
Q1 2017 – Summary Covestro fully on track Strong volume growth with a focused portfolio supported by continued robust demand Solid earnings and cash flow generation helped by higher industry utilization and a focus on profitability Robust financial profile with an investment grade rating (Baa2 from
Slide 16: Upcoming IR Events
Upcoming IR Events Find more information on investor.covestro.com Reporting dates • July 25, 2017 Q2 2017 Interim Report • October 24, 2017 Q3 2017 Interim Statement • February 20, 2018 Q4 & FY 2017 Annual Report Annual General Meeting • May 3, 2017 Annual General Meeting, Bonn Broker conferences •