Slide 1: First-Half 2019 Results Presentation
FIRST-HALF 2019 RESULTS PRESENTATION "A WORLD OF NICHE MARKET LEADERS" Ramp-up of the Group’s transformation process to accelerate its upscaling Michaël FRIBOURG Chairman & Chief Executive Officer Olivier BUQUEN Chief Financial Officer September 12, 2019
Slide 2: Summary
SUMMARY Chargeurs – First-Half 2019 Results – September 12, 2019 ―2
Slide 3: Standing firmly by strategic growth targets (1/3)
Chargeurs is standing firmly by its strategic growth targets in a more volatile environment (1/3) Creating global champions in niche markets with a high value-added, low capital intensity and strong growth potential Our core business ➔ In the space of 4 years, the Group has become no. 1 worldwide in
Slide 4: Standing firmly by strategic growth targets (2/3)
Chargeurs is standing firmly by its strategic growth targets in a more volatile environment (2/3) ⚫ Increasing operating margins over the long term in all of our businesses by constantly keeping them on a tight rein ⚫ Putting in place a strong strategy aimed at: ▪ Evenly weighting our worldwide cove
Slide 5: Standing firmly by strategic growth targets (3/3)
Chargeurs is standing firmly by its strategic growth targets in a more volatile environment (3/3) ⚫ Heavy investments to futureproof the Group: ▪ TSC1, acquisitions of PCC and Leach in 2018 Our ⚫ Regular dividend payments to our shareholders since 2015 achievements ⚫ Strategy of capturing growth and
Slide 6: H1 2019 – one of best-ever first-half performances (1/2)
H1 2019 – one of the Group’s best-ever first-half performances despite the economic environment and a peak in opex and capex (1/2) ⚫ H1 2019: revenue up 13.6%, EBITDA up 6.2% and cash flow up 5.1%; return to like-for-like growth in Q2 2019 ⚫ H1 2019 recurring operating profit of €22.7m – one of the
Slide 7: H1 2019 – one of best-ever first-half performances (2/2)
H1 2019 – one of the Group’s best-ever first-half performances despite the economic environment and a peak in opex and capex (2/2) ⚫ 9 first-rate acquisitions including Main Tape, CPSM (Asidium, Omma, Game Changer: sequence of investments and Ongoing Walco), Leach, PCC and the 3 global champions mak
Slide 8: Contents
CONTENTS 1. Strategic review: Well on track to meet our €1bn revenue target by 2021 2. Business and financial review 3. Outlook and opportunities Chargeurs – First-Half 2019 Results – September 12, 2019 ―8
Slide 9: A world leader in high value-added niche markets
Chargeurs, a world leader in high value -added niche markets: robust growth and well on track to meet its revenue target AMERICAS EUROPE ASIA WORLDWIDE Leadership positions Industrial IN NICHE MARKETS excellence OF LTM OF LTM OF LTM SERVING OVER REVENUE REVENUE REVENUE 90 AT JUNE 30, 2019 AT JUNE 30
Slide 10: Strategic Review
STRATEGIC REVIEW: 1 WELL ON THE WAY TO MEETING OUR €1BN REVENUE TARGET BY 2021 Chargeurs – First-Half 2019 Results – September 12, 2019 ― 10
Slide 11: High strategic potential in all of our businesses
High strategic potential in all of our businesses Sub-segments with high potential for growth and value creation Leadership positions IN NICHE MARKETS Sub-segments with Growth high potential for sub-segments value creation CHARGEURS Surface quality ▪ Stainless steel PROTECTIVE protection films ▪ Lam
Slide 12: Structural strengths reinforced in a volatile operating environment
Structural strengths reinforced in a volatile operating environment ◼ 4 world leaders in niche industrial markets with high ◼ A strategy of targeted, value-creating acquisitions made value added and low capital intensity possible thanks to a solid, flexible and low-cost financial All of the Group’
Slide 13: Successful upscaling since 2015 through operational excellence
Successful upscaling since 2015, achieved thanks to a strict model of operational excellence Chargeurs is reaping the rewards of a committed and long-term strategy of excellence A clear vision, Ongoing and tightly-controlled Quantitative & qualitative with new management systems implementation value
Slide 14: A strategy underpinned by a stronger financial structure
A strategy underpinned by a stronger financial structure Groupe ◼ Groupe Familial Fribourg significantly raised its investment in Chargeurs’ capital base in Familial Fribourg H1 2019 by becoming the controlling shareholder of Colombus Holding controlling stake ⚫ Groupama – a blue chip, long-term inv
Slide 15: Game Changer: performance acceleration plan (1/3)
Game Changer: the Group’s performance acceleration plan (1/3) SMART AND ADVANCED MANUFACTURING Improving the performance of Objective: our production assets Reducing our production costs • €1bn in revenue by 2021 Reducing our TALENT MANAGEMENT non-quality • > 10% normative operating margin as from 2
Slide 16: Game Changer: premiumization strategy (2/3)
Game Changer: a premiumization strategy underpinned by measures to step up the plan (2/3) Game Changer: an operating performance acceleration plan that advocates daily discipline in the creation of long-term value and that is based on four key areas: Sales and Marketing Smart & Advanced Innovation T
Slide 17: Game Changer: premiumization strategy (3/3)
Game Changer: a premiumization strategy underpinned by measures to step up the plan (3/3) Chargeurs – First-Half 2019 Results – September 12, 2019 ― 14
Slide 18: Larger geographic footprint since 2015
A much larger geographic footprint since 2015 and strong growth potential in the Americas and Asia Key Revenue A larger international Production units footprint Distribution units In 2015, Chargeurs generated over Offices 90% of its revenue in international Employees markets, with some 1,500 employe
Slide 19: Cementing leadership through acquisitions (1/5)
Cementing leadership positions at a faster pace thanks to carefully -purchased and well-integrated acquisitions in high -potential segments (1/5) Guided by the Chargeurs Business Standards, since 2015 Chargeurs has carried out targeted acquisitions, creating champions in high value-added niche marke
Slide 20: Cementing leadership through acquisitions (2/5)
Cementing leadership positions at a faster pace thanks to carefully -purchased and well-integrated acquisitions in high -potential segments (2/5) ⚫ PCC: $80m in revenue, of which more than 90% generated in Asia ⚫ 300 employees in a dozen countries, primarily in Asia and the United States ⚫ Leader in
Slide 21: Cementing leadership through acquisitions (3/5)
Cementing leadership positions at a faster pace thanks to carefully -purchased and well-integrated acquisitions in high -potential segments (3/5) One year on: PCC is successfully integrated ◼ Rebranding & integration ⚫ New name: ChargeursPCC Fashion Technologies ⚫ Offices and warehouses streamlined
Slide 22: Cementing leadership through acquisitions (4/5)
Cementing leadership positions at a faster pace thanks to carefully -purchased and well-integrated acquisitions in high -potential segments (4/5) A global benchmark for museum heritage management and visitor experience services Founded in the UK in 1891 Based in London • Pioneer in large format grap
Slide 23: Cementing leadership through acquisitions (5/5)
Cementing leadership positions at a faster pace thanks to carefully -purchased and well-integrated acquisitions in high -potential segments (5/5) Chargeurs Technical Substrates: Leach is successfully integrated ◼ Development & integration ⚫ New panel of sales aids: website and promotional video and
Slide 24: Launch of the Iconic Champions plan
Launch of the Iconic Champions plan: premiumization pursued Chargeurs – First-Half 2019 Results – September 12, 2019 ― 24
Slide 25: Premiumization with High Emotion Technologies marketing strategy
Premiumization accompanied by a high -potential marketing strategy: High Emotion Technologies ® This global marketing approach is designed to drive the upscaling of the Group and its businesses A solid industrial heritage... ...Underpinning 3 fundamentals focused on ...which are drivers of accelerat
Slide 26: Business and Financial Review
2 BUSINESS AND FINANCIAL REVIEW Resilient performances despite a less favorable environment and the Group’s strategic decision to intensify capex and opex Chargeurs – First-Half 2019 Results – September 12, 2019 ― 26
Slide 27: H1 2019 down like-for-like but among best first halves
H1 2019 down year on year on a like -for-like basis but still one of the Group’s best first-half performances, and capex remaining high Ramp-up of the Group’s transformation process to accelerate its upscaling H1 2019 ◼ Reported revenue increase fueled by acquisition-led growth in an unfavorable eco
Slide 28: Half-year performances since 2015
Half-year performances since 2015 Revenue EBITDA Recurring operating profit +27% since 2015 +57% since 2015 +47% since 2015 326.1 32.5 30.6 24.8 29.1 23.5 22.7 287.1 281.8 20.3 25.3 256.6 253.5 20.7 15.6 6.1% 8.0% 8.3% 8.6% 7.0% 8.1% 10.0% 10.3% 10.7% 10.0% €m €m €m H1 2015 H1 2016 H1 2017 H1 2018 H
Slide 29: H1 2019 revenue up more than 13%
H1 2019: revenue up by more than 13% compared with the record high of H1 2018 and despite an unfavorable operating context Strong revenue growth in all regions fueled by recent acquisitions First half Change 19/18 (1) In euro millions 2019 2018 Reported lfl Europe 151.3 146.6 +3.2% +0.6% Americas 77
Slide 30: First-half 2019 key figures
First-half 2019 key figures Another strong increase in results Group Protective Films Fashion Technologies Technical Substrates Luxury Materials Intensified opex drive Change in scale Creation of a global Premiumization 326.1 champion 281.8 287.1 256.6 253.5 143.3 150.0 142.1 107.7 113.6 120.5 79.7
Slide 31: Chargeurs Protective Films
June 2019 Chargeurs Protective Films From New York Penn to Boston, stations under renovation Chargeurs - Résultats Chargeurs semestriels - Résultats 20192019 semestriels - 12 septembre 2019 2019 - 12 septembre ― 31
Slide 32: Chargeurs Protective Films – First-Half 2019 Highlights
CPF CHARGEURS PROTECTIVE FILMS "THE LEADING INNOVATIVE COATING SOLUTIONS" First-Half 2019 Highlights ◼ Premium production unit successfully brought into service ◼ A difficult Q1 2019 in Germany and China but much better momentum in Q2 with a stronger order book ◼ Faster deployment of disruptive inno
Slide 33: Protective Films key figures
Chargeurs Protective Films Key figures Return to growth in Q2 2019 after a contraction in Q1. Stronger order book H1 2019 Q2 2019 Q1 2019 H1 2019 H1 2018 vs vs vs In euro millions H1 2018 Q2 2018 Q1 2018 Revenue 142.1 150.0 -5.3% -3.2% -7.4% (1) like-for-like -7.1% -4.6% -9.5% EBITDA (2) 19.2 21.7 -
Slide 34: Accelerating premiumization with first techno-smart production line
Accelerating the premiumization of CPF’s offering, with the launch of its first techno-smart production line Industrial prowess Premiumization Launch of the new production line six months Faster production of highly engineered, high value- ahead of the initial schedule added films Technological edge
Slide 35: Chargeurs Fashion Technologies
2019, Chargeurs Fashion Technologies From the Fendi Show to the New York Marathon Chargeurs - Résultats semestriels 2019 - 12 septembre 2019 ― 35
Slide 36: ChargeursPCC Fashion Technologies – First-Half 2019 Highlights
CFT CHARGEURSPCC FASHION TECHNOLOGIES “CREATING THE NEW WORLDWIDE LEADER” First-Half 2019 Highlights ◼ PCC Interlining successfully integrated ◼ Products developed from recycled fibers and faster deployment of eco-responsible products ◼ Launch of strategic partnerships, such as with the Fashion Ins
Slide 37: PCC Fashion Technologies key figures
Chargeurs PCC Fashion Technologies Key figures Sharp growth in operating performance, driven by the successful integration of PCC H1 2019 Q2 2019 Q1 2019 H1 2019 H1 2018 vs vs vs In euro millions H1 2018 Q2 2018 Q1 2018 Revenue 107.7 68.8 +56.5% +56.3% +56.8% (1) like-for-like 2.3% +2.3% +2.4% (2)
Slide 38: Chargeurs Technical Substrates
2019, Chargeurs Technical Substrates From the Louvre to the Brooklyn Museum Chargeurs - Résultats Chargeurs semestriels - Résultats 20192019 semestriels - 12 septembre 2019 2019 - 12 septembre ― 38
Slide 39: Chargeurs Technical Substrates – First-Half 2019 Highlights
CTS CHARGEURS TECHNICAL SUBSTRATES THE CREATION OF A NEW GLOBAL CHAMPION IN MUSEUM EXPERIENCE First-Half 2019 Highlights ◼ Creation of Chargeurs Creative Collection, a global benchmark in services for museums o Acquisition of majority stakes in 3 global champions with very high value added: MET, Des
Slide 40: Technical Substrates key figures
Chargeurs Technical Substrates Key figures Creation of a global champion in museum heritage management and visitor experience services: €60m in additional full-year revenue H1 2019 Q2 2019 Q1 2019 H1 2019 H1 2018 vs vs vs In euro millions H1 2018 Q2 2018 Q1 2018 Revenue 18.0 14.8 +21.6% +16.5% +28.6
Slide 41: Chargeurs Luxury Materials
2019, Chargeurs Luxury Materials From the Sheep to the Shop Chargeurs - Résultats semestriels 2019 - 12 septembre 2019 ― 41
Slide 42: Chargeurs Luxury Materials – First-Half 2019 Highlights
CHARGEURS LUXURY MATERIALS CLM "FROM THE SHEEP TO THE SHOP" First-Half 2019 Highlights ◼ Organica Precious Fiber eco-traceable wool label listed by Kering ◼ New strategic partnerships signed with major well-known brands, focused on developing premium, traceable and sustainable products ◼ H1 2019: in
Slide 43: Luxury Materials key figures
Chargeurs Luxury Materials Key figures CLM is starting to reap the benefits of the opex projects carried out to help upscale its products H1 2019 Q2 2019 Q1 2019 H1 2019 H1 2018 vs vs vs In euro millions H1 2018 Q2 2018 Q1 2018 Revenue 58.2 53.5 +8.8% +16.2% +3.0% (1) like-for-like 7.5% +15.3% +1.3%
Slide 44: Financial Review
FINANCIAL REVIEW Chargeurs – First-Half 2019 Results – September 12, 2019 ― 44
Slide 45: Consolidated Income Statement
Consolidated Income Statement Recurring operating profit once again high despite a more volatile operating environment and high levels of capex In euro millions H1 2019 H1 2018 Change Comments Revenue 326.1 287.1 +39.0 -1.9% like-for-like against a record figure in H1 2018; internal growth of 0.8 %
Slide 46: Revenue and recurring operating profit bridges
Revenue and recurring operating profit bridges Revenue bridge (in €m) Recurring operating profit bridge (in €m) 42.9 1.6 3.0 326.1 287.1 -8.5 -1.9% organic 3.5 0.4 22.7 24.8 0.6 -5.5 8.6% -1.1 7.0% -24.2% organic H1 2018 Scope Currency Volume Price/mix H1 2019 H1 2018 Scope Currency Volume Price/mix
Slide 47: Success of the Annual Productivity Plan
Success of the Annual Productivity Plan 2019 target: €7.3m in cost savings for the full year Cost savings generated by the annual productivity plan Productivity plan 7.3 Savings on production costs Savings on distribution 48% 31% costs 2.2 2.1 9% 3.5 Savings on administrative €3.5m in €m and other f
Slide 48: Balance Sheet Analysis
Balance Sheet Analysis A constantly robust balance sheet structure In euro millions 06/30/19 12/31/18 Comments Intangible assets 157.6 158.1 Right-of-use assets 27.7 0.0 Impact of the application of IFRS 16 including €11.2m in reclassification of finance leases Property, plant and equipment 83.1 80.
Slide 49: Statement of cash flows
Statement of cash flows In euro millions H1 2019 H1 2018 Comments EBITDA 32.5 30.6 Up 6.2%: impact of IFRS 16 (€3.3m), growth opex and annual productivity plan Non-recurring – cash (4.2) (2.0) Acquisition-related expenses Finance costs – cash (5.3) (4.5) Strengthening of financial resources and exte
Slide 50: Outlook and Opportunities
3 OUTLOOK AND OPPORTUNITIES Chargeurs – First-Half 2019 Results – September 12, 2019 ― 50
Slide 51: Building a long-term model of quality and excellence
Building a long-term model of quality and excellence Reasonable but essential levels of capex for transforming a high-potential industrial group into the world champion in high value-added niche markets that it has become today A solid model built on 3 pillars ⚫ Game Changer plan ⚫ No more low-margi
Slide 52: Pursuing our acquisition strategy
Pursuing our acquisition strategy Distinctive Create global champions in high value-added niche markets vision Focus on accretive businesses Vertical acquisitions to move up the Game-changing bolt-on acquisitions Acquisitions in new businesses with high Disruption & value chain and offer end-to-end
Slide 53: Ambitious and achievable medium- and long-term objectives
Ambitious and achievable medium- and long-term objectives Target for end-2021 confirmed: €1bn in profitable revenue (subject to macro-economic conditions remaining constant) Steadily rising margins thanks to the product mix and economies of scale Full-year revenue Growth track for target of €1bn in
Slide 54: Maximizing shareholder value creation
Maximizing shareholder value creation Shareholder value creation strategy Ownership structure at July 31, 2019: 23 756 103 shares Ownership structure at May 31, 2019: Share performance since the change in Chargeurs' governance structure ( CAC 40 and SBF 120 adjusted in line with Chargeurs' share pri
Slide 55: Appendices
APPENDICES Chargeurs – First-Half 2019 Results – September 12, 2019 ― 55
Slide 56: Glossary
Glossary Glossary ◼ Change based on a comparable scope of consolidation and at constant exchange rates (like-for-like), organic change or internal change for year Y compared with year Y-1 is calculated: ⚫ applying the average exchange rates for year Y-1 to the period concerned (year, half-year, quar
Slide 57: Disclaimer
Disclaimer This presentation may contain forward-looking statements relating to the business, results and financial position of the Chargeurs Group. Such forward-looking statements are based on assumptions that are currently considered reasonable but which are dependent on external factors such as c
Slide 58: 2019 Investor Calendar
2019 INVESTOR CALENDAR Thursday, November 14, 2019 Third-quarter 2019 financial information (after the close of trading) Chargeurs 112, avenue Kléber 75 116 Paris +33 1 47 04 13 40 comfin@chargeurs.com www.chargeurs.com