Kloeckner & Co SE · XETR:KCO

Kloeckner & — Klöckner & — Non-Deal Roadshow (November 2023)

42 slides from Kloeckner &'s roadshow presentation, Nov 10, 2023

  1. Slide 1: Bankhaus Metzler Roadshow

    BANKHAUS METZLER ROADSHOW November 10, 2023 Dr. Oliver Falk | CFO

  2. Slide 2: Disclaimer

    DISCLAIMER This presentation contains forward-looking statements which reflect the In addition to the key figures prepared in accordance with IFRS and current views of the management of Klöckner & Co SE with respect to German-GAAP respectively, Klöckner & Co SE is presenting non-GAAP future events.

  3. Slide 3: Agenda

    AGENDA 1. Overview 2. Strategy update and highlights 3. Financials 4. Outlook 5. Appendix 3 Klöckner & Co SE | Metzler Roadshow

  4. Slide 4: Klöckner & Co SE at a glance

    KLÖCKNER & CO SE AT A GLANCE ~7,800 9,379€ million 4,679 thousand tons Employees Sales FY 2022 Shipments FY 2022 >90,000 417€ million 44% Customers EBITDA* FY 2022 Digital Sales Q4 2022 ~200,000 13 ~160 Products Countries Locations * Before material special effects. 4 Klöckner & Co SE | Metzler Road

  5. Slide 5: Klöckner & Co value chain – everything from one source

    KLÖCKNER & CO VALUE CHAIN – EVERYTHING FROM ONE SOURCE Suppliers Customers 5 Klöckner & Co SE | Metzler Roadshow

  6. Slide 6: Global reach – local presence

    GLOBAL REACH – LOCAL PRESENCE 3% 2% UK Benelux 25% G/A 51% 5% N.A. F 13% CH 1% Brazil As of December 31, 2022 pro forma figures incl. KMM 6 Klöckner & Co SE | Metzler Roadshow

  7. Slide 7: Leading player in fragmented markets

    LEADING PLAYER IN FRAGMENTED MARKETS Market shares of Klöckner & Co 2022 Europe USA 6% 9% ArcelorMittal thyssenkrupp Reliance Kloeckner Metals Klöckner & Co Salzgitter Ryerson thyssenkrupp Tata Others Others Source: Eurometal, MSCI, local steel associations, estimates. 7 Klöckner & Co SE | Metzler R

  8. Slide 8: Agenda

    AGENDA 1. Overview 2. Strategy update and highlights 3. Financials 4. Outlook 5. Appendix 8 Klöckner & Co SE | Metzler Roadshow

  9. Slide 9: Becoming the leading one-stop-shop for steel, other materials, equipment and processing services

    BECOMING THE LEADING ONE-STOP-SHOP FOR STEEL, OTHER MATERIALS, EQUIPMENT AND PROCESSING SERVICES IN EUROPE AND THE AMERICAS CUSTOMER GROWTH CORPORATE VALUES Growth through expanded customer base and Realizing customer centric platform model by increased share of wallet, due to customer leveraging pe

  10. Slide 10: Sustainable growth with high performance through the entire cycle

    SUSTAINABLE GROWTH WITH HIGH PERFORMANCE THROUGH THE ENTIRE CYCLE Our 2025 Goals Sales growth above market ROCE above cost of capital More than doubling normalised EBITDA level (as of before pre-COVID) 10 Klöckner & Co SE | Metzler Roadshow

  11. Slide 11: New growth platform in North America – acquisition of National Material of Mexico

    NEW GROWTH PLATFORM IN NORTH AMERICA – ACQUISITION OF NATIONAL MATERIAL OF MEXICO Transaction overview  Purchase price of USD340m on cash and debt free basis  EV-multiple of ~6.7 based on expected 2022 EBITDA; representing a highly attractive expansion of our activities  NMM employs around 500 pe

  12. Slide 12: Creating value through leveraging strategic fit

    CREATING VALUE THROUGH LEVERAGING STRATEGIC FIT  Acquisition immediately value-accretive and provides growth platform while capitalizing on accelerating onshoring trend Significant Supplying  Significantly increasing exposure to key automotive and industrial end cross-selling electrical markets in

  13. Slide 13: Klöckner & Co SE | Metzler Roadshow

    ▪ ▪ ▪ ▪ ▪ ▪ 13 Klöckner & Co SE | Metzler Roadshow

  14. Slide 14: Strategy progress in a demanding market environment

    STRATEGY PROGRESS IN A DEMANDING MARKET ENVIRONMENT Successful transactions to increase Executing European Efficiency Investment dedicated to HVAB in HVAB exposure Program Switzerland  Integration of HVAB pure play NMM  Reducing number of FTEs of European  Invested in state-of-the-art into KMM; s

  15. Slide 15: Sustainability strategy: housekeeping and business opportunities

    STRATEGIC PERCEPTION OF SUSTAINABILITY SUSTAINABILITY TRANSFORMATION Business Opportunities STRATEGY Housekeeping Emission reduction Significant opportunities from offering sustainable Fostering sustainable business solutions business solutions Social Governance responsibility reliability 15 Klöckne

  16. Slide 16: Our ambitious climate targets

    OUR AMBITIOUS CLIMATE TARGETS SCOPE 1 & 2 SCOPE 3 SCOPE 3 Kloeckner & Co is the OWN DIRECT AND UNDER DIRECT SUPPLIERS AND first company INDIRECT EMISSIONS INFLUENCE CUSTOMERS worldwide with net zero approval from SBTi 50% reduction 50% reduction 30% reduction by 2030 by 2030 by 2030 Net zero Net zer

  17. Slide 17: We've come a long way in 2022

    We’ve come a long way in 2022 – Building sustainable business models for our customers World's first company with Introduction of our CO2- Launch of Nexigen® and net zero target approval of SBTi reduced steel categorization introduction of categorizations to new standards for CO2-reduced stainless s

  18. Slide 18: Launch of innovative Nexigen PCF Algorithm

    Accelerating further Launch of innovative Nexigen® PCF Algorithm in 2023  Individualized Product Carbon Footprints (PCF) Offering our customers individualized PCFs for nearly all 200,000 products; for gray and CO2-reduced products  Complete emissions Managing high complexity; from cradle until the

  19. Slide 19: Leading the sustainability transformation

    LEADING THE SUSTAINABILITY TRANSFORMATION Launch of Nexigen® Data Services  Offering smart and digital management of CO2-emissions and Product Carbon Footprints (PCFs)  Built on and driven by the Nexigen® PCF Algorithm  Solution offers extended PCF order history as well as transparent insights 

  20. Slide 20: Agenda

    AGENDA 1. Overview 2. Strategy update and highlights 3. Financials 4. Outlook 5. Appendix 20 Klöckner & Co SE | Metzler Roadshow

  21. Slide 21: Highlights of Q3 2023

    HIGHLIGHTS OF Q3 2023 Q3 2023 Q3 2022 Slightly above prior year quarter supported by NMM acquisition and despite Shipments (Tto) 1,191 1,148 +3.7% challenging market environment, especially in Europe Sales (€m) 1,929 2,367 -18.5% Decrease due to considerably lower average price level yoy Gross profi

  22. Slide 22: Solid operating performance and positive cash generation

    SOLID OPERATING PERFORMANCE AND POSITIVE CASH GENERATION Our net working capital management  Achieved solid operating result in Q3 2023 and once again, a positive operating cash flow despite an ongoing ~1,300 challenging market environment ~970  Mitigated large parts of negative price risks during

  23. Slide 23: EBITDA (€m) in Q3 2023

    EBITDA (€M) IN Q3 2023 7  Solid EBITDA-performance despite challenging market -4 environment 17  Negative volume effect of €-10m (excl. KMM) largely EU- Europe 41  Positive price effects of €16m  OPEX down, mainly driven by lower personal expenses & 16 -10 shipping costs and lower consulting exp

  24. Slide 24: Cash flow and net debt development

    CASH FLOW AND NET DEBT DEVELOPMENT Cash flow Q3 2023 (€m) 24 -14  EBITDA reported of €41m -15 41 36  NWC decrease of €24m  Strong cash flow from operating activities of €36m -340 -304  Net CAPEX €340m (thereof NMM €310m net)  Free cash flow accordingly of €-304m EBITDA Change Interest Taxes Cas

  25. Slide 25: Strong and solid balance sheet

    STRONG AND SOLID BALANCE SHEET Solid equity ratio of 46%, gearing*) of 49% and leverage of 6.1x Assets Equity & Liabilities 4,214 4,214 3,859 3,859 1,246 1,033 1,953 1,968 46% 51% 1,613 1,633 1,042 760 38 30 940 1,117 785 866 73 179 121 117 308 323 Dec 31, 2022 Sep 30, 2023 Dec 31, 2022 Sep 30, 2023

  26. Slide 26: Agenda

    AGENDA 1. Overview 2. Strategy update and highlights 3. Financials 4. Outlook 5. Appendix 26 Klöckner & Co SE | Metzler Roadshow

  27. Slide 27: Region specific business outlook 2023

    REGION SPECIFIC BUSINESS OUTLOOK 2023 North America +0-2% Real steel Construction Manufacturing, Transportation Household & Energy demand industry machinery & mechanical Commercial industry engineering Appliances Europe -2-0% 27 Klöckner & Co SE | Metzler Roadshow

  28. Slide 28: Outlook

    OUTLOOK  Shipments expected to increase slightly yoy; sales expected to be below prior-year due to lower FY overall price level  EBITDA expectation of €170-200m before material special effects 2023  Strong and significantly positive operating cash flow expected 28 Klöckner & Co SE | Metzler Roads

  29. Slide 29: Agenda

    AGENDA 1. Overview 2. Strategy update and highlights 3. Financials 4. Outlook 5. Appendix 29 Klöckner & Co SE | Metzler Roadshow

  30. Slide 30: Quarterly and FY results

    QUARTERLY AND FY RESULTS Q3 Q2 Q1 Q4 Q3 Q2 Q1 Q4 Q3 Q2 Q1 FY FY FY FY FY (€m) 2023 2023 2023 2022 2022 2022 2022 2021 2021 2021 2021 2022 2021 2020 2019 2018 Shipments (Tto) 1,191 1,158 1,213 1,047 1,148 1,226 1,257 1,108 1,190 1,295 1,287 4,679 4,881 4,873 5,648 6,107 Sales 1,929 1,967 2,076 1,993

  31. Slide 31: Segment overview

    SEGMENT OVERVIEW Kloeckner Metals US Q3 Q2 Q1 Q4 Q3 Q2 Q1 FY FY (€m) 2023 2023 2023 2022 2022 2022 2022 2022 2021 Kloeckner Metals US Shipments (Tto) 669 598 599 504 561 588 586 2,239 2,399 The Kloeckner Metals US segment comprises all our business in the USA, Mexico and Brazil. It covers all servic

  32. Slide 32: Segment performance

    SEGMENT PERFORMANCE KM US Shipments (Tto) Sales (€m) EBITDA (€m) +19.3% -12.3% 669 1,158 65 599 598 561 1,016 46 45 38 504 905 929 930 4 Q3 2022 Q4 2022 Q1 2023 Q2 2023 Q3 2023 Q3 2022 Q4 2022 Q1 2023 Q2 2023 Q3 2023 Q3 2022 Q4 2022 Q1 2023 Q2 2023 Q3 2023 KM EU Shipments (Tto) Sales (€m) EBITDA*) (

  33. Slide 33: Maturity profile

    MATURITY PROFILE Facility Committed Drawn amount €m Sep 30, 2023 (€m) Sep 30, 2023 Sep 30, 2023 Dec 31, 2022 Adjusted equity2) 1,890 Syndicated Loan 250 169 25 Net Debt 923 ABS Europe 300 154 159 Gearing3) 49% ABL USA 614 387 155 Leverage4) 6.1x Convertible 2016 - - 139 Bilateral Facilities1) 233 16

  34. Slide 34: Sales by markets, products and industries

    SALES BY MARKETS, PRODUCTS AND INDUSTRIES Sales by markets*) Sales by products Sales by industries 3% 2%1% 8% 9% 5% 2% 8% 11% 13% 31% 7% 51% 12% 51% 10% 25% 13% 14% 24% North America Flat products Construction Germany/Austria Long products Manufacturing, Machinery, Mechanical Engineering Switzerland

  35. Slide 35: Current shareholder structure

    CURRENT SHAREHOLDER STRUCTURE 3% 1% 3% Geographical breakdown of identified 3% 4% Germany institutional investors US France 22% Switzerland  Identified institutional investors account for 60% UK  German investors incl. retail dominate 64% Rest of EU Rest of world  Top 10 shareholdings represent a

  36. Slide 36: Share price performance in Q3 2023

    SHARE PRICE PERFORMANCE IN Q3 2023 105% 100%  The share price of Klöckner & Co reached its highest level of 95% €8.87 on July 3. Afterwards the share price decreased before rising again towards the end of July 90%  In the beginning of August, the share price decreased sharply and increased again t

  37. Slide 37: Dividend policy

    DIVIDEND POLICY In general, Klöckner & Co SE follows a dividend policy of  Inclusion of our general dividend policy in financial distributing 30% of net income before special items. year 2010 with a dividend of €0.30 per share Given the volatility of our business model, a sustainable  Due to earni

  38. Slide 38: Creating value through green steel offering

    CREATING VALUE THROUGH GREEN STEEL OFFERING Characteristics of the European green steel industry Current green steel premium*)  Supply shortage due to limited scrap and green H2 availability at competitive prices (HRC/ton) Grey steel +25 - 40%  Significant demand surplus due to customers’ need to

  39. Slide 39: Development of the European green steel market

    DEVELOPMENT OF THE EUROPEAN GREEN STEEL MARKET Supply shortfall Before 2025 of 15-20Mt  BF-BOF remains major source; also balanced steel on the market  Demand mainly from lighthouse projects 2025 to 2030  Capacity of up to 30 Mt mainly from mix of green H2 and natural Estimates by 2030*) gas; bal

  40. Slide 40: Nexigen steel categorization

    NEXIGEN® STEEL CATEGORIZATION Six categorizations for transparent carbon emissions We have developed a categorization for CO2-reduced steel so that customers can directly see the carbon footprint of their purchased product. Emission in kg CO2 / t Steel LEADING THE SUSTAINABILITY TRANSFORMATION Our a

  41. Slide 41: A comprehensive approach: Nexigen categorizations for stainless steel & aluminum

    A COMPREHENSIVE APPROACH Nexigen® categorizations for stainless steel & aluminum Stainless Steel Emission in kg CO2 / t stainless steel Aluminum Emission in kg CO2 / t aluminum 41 Klöckner & Co SE | Metzler Roadshow

  42. Slide 42: Financial calendar

    FINANCIAL CALENDAR March 13, 2024 Annual Financial Statement 2023 Fabian Joseph May 7, 2024 Head of Investor Relations Q1 quarterly statement 2024 +49 203 307-2291 May 23, 2024 Annual General Meeting 2024 fabian.joseph@kloeckner.com www.kloeckner.com August 1, 2024 Half-yearly financial report 2024

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