Novonesis A/s Class B · OMXCOP:NSIS_B
Novonesis A/s Class B — Novozymes — Non-Deal Roadshow (April 2017)
54 slides from Novonesis A/s Class B's roadshow presentation, Apr 26, 2017
Slide 1: Road Show presentation Q1 2017
Road Show presentation Q1 2017 April 26" 2017 ‘ious 9 “Movozymes Rethink Tomorrow
Slide 2: Table of contents
Table of contents 1. Latest results 3 2. Overview and Strategy 12 3. Market Overview 23 - Household Care 24 - Food & Beverages 27 - Bioenergy 29 - Agriculture & Feed 33 - Technical & Pharma 40 4. Sustainability 41 5. Financials and Governance 46
Slide 3: LATEST RESULTS • OVERVIEW AND STRATEGY • MARKET OVERVIEW • SUSTAINABILITY • FINANCIALS AND
• • • LATEST RESULTS • OVERVIEW AND STRATEGY • MARKET OVERVIEW • SUSTAINABILITY • FINANCIALS AND GOVERNANCE
Slide 4: LATEST RESULTS • OVERVIEW AND STRATEGY • MARKET OVERVIEW • SUSTAINABILITY • FINANCIALS AND
• • • • • • • LATEST RESULTS • OVERVIEW AND STRATEGY • MARKET OVERVIEW • SUSTAINABILITY • FINANCIALS AND GOVERNANCE
Slide 5: LATEST RESULTS • OVERVIEW AND STRATEGY • MARKET OVERVIEW • SUSTAINABILITY • FINANCIALS AND
• • • • • LATEST RESULTS • OVERVIEW AND STRATEGY • MARKET OVERVIEW • SUSTAINABILITY • FINANCIALS AND GOVERNANCE 5
Slide 6: LATEST RESULTS • OVERVIEW AND STRATEGY • MARKET OVERVIEW • SUSTAINABILITY • FINANCIALS AND
• • • • • • LATEST RESULTS • OVERVIEW AND STRATEGY • MARKET OVERVIEW • SUSTAINABILITY • FINANCIALS AND GOVERNANCE 6
Slide 7: LATEST RESULTS • OVERVIEW AND STRATEGY • MARKET OVERVIEW • SUSTAINABILITY • FINANCIALS AND
• • • • • • LATEST RESULTS • OVERVIEW AND STRATEGY • MARKET OVERVIEW • SUSTAINABILITY • FINANCIALS AND GOVERNANCE 7
Slide 8: LATEST RESULTS • OVERVIEW AND STRATEGY • MARKET OVERVIEW • SUSTAINABILITY • FINANCIALS AND
• • • • • • LATEST RESULTS • OVERVIEW AND STRATEGY • MARKET OVERVIEW • SUSTAINABILITY • FINANCIALS AND GOVERNANCE 8
Slide 9: LATEST RESULTS • OVERVIEW AND STRATEGY • MARKET OVERVIEW • SUSTAINABILITY • FINANCIALS AND
• • • • • • • LATEST RESULTS • OVERVIEW AND STRATEGY • MARKET OVERVIEW • SUSTAINABILITY • FINANCIALS AND GOVERNANCE 9
Slide 10: LATEST RESULTS • OVERVIEW AND STRATEGY • MARKET OVERVIEW • SUSTAINABILITY • FINANCIALS AND
• • LATEST RESULTS • OVERVIEW AND STRATEGY • MARKET OVERVIEW • SUSTAINABILITY • FINANCIALS AND GOVERNANCE 10
Slide 11: LATEST RESULTS • OVERVIEW AND STRATEGY • MARKET OVERVIEW • SUSTAINABILITY • FINANCIALS AND
• • • • • LATEST RESULTS • OVERVIEW AND STRATEGY • MARKET OVERVIEW • SUSTAINABILITY • FINANCIALS AND GOVERNANCE
Slide 12: Overview and Strategy
Rethink Tomorrow
Slide 13: LATEST RESULTS • OVERVIEW AND STRATEGY • MARKET OVERVIEW • SUSTAINABILITY • FINANCIALS AND
• • • • • • • • • • • • • • • • LATEST RESULTS • OVERVIEW AND STRATEGY • MARKET OVERVIEW • SUSTAINABILITY • FINANCIALS AND GOVERNANCE 13
Slide 14: Household Care, Food & Beverages, Bioenergy, Agriculture & Feed, Technical & Pharma
Household Food & Bioenergy Agriculture & Technical & Care Beverages Feed Pharma Laundry & Dishwasher Baking, Starch to syrups, Corn ethanol Animal feed Textile & Leather, Pulp & detergents, Brewing & Alcohol, Healthy Cellulosic biofuels BioAgriculture Paper, Wastewater, Pharma Cleaning products conc
Slide 15: Commercial and technology risk
Existing tech in new Find partner, reduce market one risk (example; launch (example; BioAg Alliance with advanced protease in Commercial Risk Emerging Markets) Monsanto or Feed Alliance with DSM) Just do it New tech in existing (example, launch market new version of (example; introduce a Novamyl in
Slide 16: Experienced leadership team
Experienced leadership team – with more than 24 years seniority on average with the business Andrew Fordyce Benny D. Loft Peder Holk Nielsen Tina S. Fanø Anders Lund Thomas Videbæk Executive Vice President, CFO & Executive Vice President, CEO & President Executive Vice President, Executive Vice Pres
Slide 17: LATEST RESULTS • OVERVIEW AND STRATEGY • MARKET OVERVIEW • SUSTAINABILITY • FINANCIALS AND
1 2 3 4 • • • • • • • • • • • • • • • • • • LATEST RESULTS • OVERVIEW AND STRATEGY • MARKET OVERVIEW • SUSTAINABILITY • FINANCIALS AND GOVERNANCE 17
Slide 18: Sales, EBIT margin, R&D/Sales, ROIC
30,0% 16.000 • • 27,5% 14.000 • 25,0% • 22,5% 12.000 20,0% 10.000 17,5% • • 15,0% 8.000 • 12,5% 6.000 10,0% 7,5% 4.000 5,0% 2.000 2,5% 0,0% 0 Sales DKKm EBIT margin R&D/Sales ROIC LATEST RESULTS • OVERVIEW AND STRATEGY • MARKET OVERVIEW • SUSTAINABILITY • FINANCIALS AND GOVERNANCE
Slide 19: Main sites with production and R&D
Main sites with production and R&D Satellite production site Satellite R&D site LATEST RESULTS • OVERVIEW AND STRATEGY • MARKET OVERVIEW • SUSTAINABILITY • FINANCIALS AND GOVERNANCE 19
Slide 20: Basic technologies, business areas and growth platforms
Established business areas Growth platforms Biomass Animal Food & Household Grain-based Technical BioAg Emerging Conversion Health & Beverages Care ethanol industries industries Nutrition Basic technologies Advance understanding, application support, development and formulation of biological systems
Slide 21: Continued development in our technology base
Continued development …creates opportunities to in our technology base… develop new business platform • Bio- Biomass Agriculture conversion • Vegetable Hygiene Probiotics Oil processing Care • Grain Sugarcane milling platform • LATEST RESULTS • OVERVIEW AND STRATEGY • MARKET OVERVIEW • SUSTAINABILIT
Slide 22: Purification, raw materials, fermentation
1 2 3 Purification Raw materials Fermentation Enzymes Formulation Micro-organisms LATEST RESULTS • OVERVIEW AND STRATEGY • MARKET OVERVIEW • SUSTAINABILITY • FINANCIALS AND GOVERNANCE
Slide 23: Market Overview
Rethink Tomorrow
Slide 24: Household Care
33% • • • • • • • • • • • • • • LATEST RESULTS • OVERVIEW AND STRATEGY • MARKET OVERVIEW • SUSTAINABILITY • FINANCIALS AND GOVERNANCE 24
Slide 25: LATEST RESULTS • OVERVIEW AND STRATEGY • MARKET OVERVIEW • SUSTAINABILITY • FINANCIALS AND
LATEST RESULTS • OVERVIEW AND STRATEGY • MARKET OVERVIEW • SUSTAINABILITY • FINANCIALS AND GOVERNANCE
Slide 26: LATEST RESULTS • OVERVIEW AND STRATEGY • MARKET OVERVIEW • SUSTAINABILITY • FINANCIALS AND
LATEST RESULTS • OVERVIEW AND STRATEGY • MARKET OVERVIEW • SUSTAINABILITY • FINANCIALS AND GOVERNANCE
Slide 27: Food & Beverages
26% • • • • • • • • • • • • • • • • LATEST RESULTS • OVERVIEW AND STRATEGY • MARKET OVERVIEW • SUSTAINABILITY • FINANCIALS AND GOVERNANCE
Slide 28: Starch processing, baking, brewing and other applications
Starch processing Baking Brewing Juice & wine Flavor Infant food enhancement Beverage Oils & fats Acrylamide Low lactose alcohol processing reduction • • • • • • • • • • • LATEST RESULTS • OVERVIEW AND STRATEGY • MARKET OVERVIEW • SUSTAINABILITY • FINANCIALS AND GOVERNANCE 28
Slide 29: Bioenergy
17% • • • • • • • • • • • • • • • LATEST RESULTS • OVERVIEW AND STRATEGY • MARKET OVERVIEW • SUSTAINABILITY • FINANCIALS AND GOVERNANCE
Slide 30: LATEST RESULTS • OVERVIEW AND STRATEGY • MARKET OVERVIEW • SUSTAINABILITY • FINANCIALS AND
LATEST RESULTS • OVERVIEW AND STRATEGY • MARKET OVERVIEW • SUSTAINABILITY • FINANCIALS AND GOVERNANCE 30
Slide 31: U.S. ethanol production volumes have stabilized
U.S. ethanol production volumes have stabilized 20 Billion Gallons 15 10 5 0 U.S. ethanol exports have increased since 2009 1.400 1.200 Million Gallons 1.000 800 600 400 200 0 Gasoline volumes are stable today. 2040 outlook is for lower volumes driven by mileage standards 120 100 80 Index 60 40 20 0
Slide 32: Cellulosic ethanol plants and partners
Europe 6. Beta Renewables 7. ST1 − Maabjerg Bioenergy − Ethanol Europe − Energo Chemica China 8. Longlive − Petro China − Cofco United States − Tianguan Group 1. POET/DSM − M&G Chemicals − NTL 2. DuPont 3. Abengoa India and South East Asia • − Beta Renewables Brazil 4. Raízen − Beta Renewables − Zea
Slide 33: Agriculture & Feed
16% • • • • • • • • • • • • • LATEST RESULTS • OVERVIEW AND STRATEGY • MARKET OVERVIEW • SUSTAINABILITY • FINANCIALS AND GOVERNANCE 33
Slide 34: LATEST RESULTS • OVERVIEW AND STRATEGY • MARKET OVERVIEW • SUSTAINABILITY • FINANCIALS AND
LATEST RESULTS • OVERVIEW AND STRATEGY • MARKET OVERVIEW • SUSTAINABILITY • FINANCIALS AND GOVERNANCE 34 QUARTERLY RESULTS • NOVOZYMES OVERVIEW • STRATEGY • MARKET OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW
Slide 35: LATEST RESULTS • OVERVIEW AND STRATEGY • MARKET OVERVIEW • SUSTAINABILITY • FINANCIALS AND
LATEST RESULTS • OVERVIEW AND STRATEGY • MARKET OVERVIEW • SUSTAINABILITY • FINANCIALS AND GOVERNANCE 35 QUARTERLY RESULTS • NOVOZYMES OVERVIEW • STRATEGY • MARKET OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW
Slide 36: Factors driving inoculant growth
Soybean Pulses Alfalfa Canola Corn Wheat Cotton Rice Factors driving inoculant growth: Global Planted Acres1 Market expansion ~ 260m ~190m ~15m ~85m ~425m ~549m ~80m ~400m (5 year avg. 2009–2013) Inoculants Treated Acres2 ~55-60% ~ 15% ~50% ~ 5% ~ 5% <1% <1% <1% 1 • Significant opportunity across cr
Slide 37: Discovery to launch development phases
PHASE 1: PHASE 2: PHASE 3: PHASE 4: DISCOVERY: EARLY ADVANCED PROOF OF CONCEPT PRE-LAUNCH DEVELOPMENT DEVELOPMENT 10’s of Thousands Thousands of Confirmed Hits / Commercial Final Launch Hits of Microbes Candidates Commercial Leads Candidates Preparation • • • • • LATEST RESULTS • OVERVIEW AND STRATE
Slide 38: Phytases, carbohydrases, proteases
• • • • • • • • • • 100% 75% Carbo- Phytases hydrases 50% 80-90% Proteases 25% 35-45% 10-15% 0% Phytase Carbohydrase Protease LATEST RESULTS • OVERVIEW AND STRATEGY • MARKET OVERVIEW • SUSTAINABILITY • FINANCIALS AND GOVERNANCE 38
Slide 39: LATEST RESULTS • OVERVIEW AND STRATEGY • MARKET OVERVIEW • SUSTAINABILITY • FINANCIALS AND
• • • • • LATEST RESULTS • OVERVIEW AND STRATEGY • MARKET OVERVIEW • SUSTAINABILITY • FINANCIALS AND GOVERNANCE 39
Slide 40: Technical & Pharma
8% • • • • • • • • • LATEST RESULTS • OVERVIEW AND STRATEGY • MARKET OVERVIEW • SUSTAINABILITY • FINANCIALS AND GOVERNANCE
Slide 41: Sustainability
aa Rethink Tomorrow
Slide 42: New long-term targets focus on world impact
New long-term targets focus on world impact New IMPACT targets Novozymes’ Updated operational targets • 10 transformative innovations • Save 100 million tons of CO2 unique contribution: Environment People • 5 partnerships for change • Reach 6 billion people with our • Energy efficiency • Occupationa
Slide 43: % change from 2005 baseline
% change from 2005 baseline Occupational accidents per million working hours Employee absence (%) LATEST RESULTS • OVERVIEW AND STRATEGY • MARKET OVERVIEW • SUSTAINABILITY • FINANCIALS AND GOVERNANCE
Slide 44: CO2 savings per application
Dairy: Margarine: Vegetable oil: Cereals: 230 kg CO2 23 kg CO2 44 kg CO2 110 kg CO2 per ton of mozzarella per ton of hardstock per ton of oil per ton of bread Beverage: Detergent: Textile: Cosmetics: 25 kg CO2 50-150 kg CO2 1100 kg CO2 190 kg CO2 per 1000 litre of beer per ton of laundry per ton of
Slide 45: Incentive program and bonus linkage
18 % stock & options awarded Max 2 months of base salary cash 100 Months of salary per year 16 bonus linked to fulfilment of EBIT 90 14 and sustainability targets 80 12 70 60 10 Max 3 months of base salary cash 50 8 bonus linked to fulfilment of personal targets 40 6 30 4 20 2 Base salary 10 0 0 1,0
Slide 46: Financials and Governance
Financials and Governance Rethink Tomorrow
Slide 47: Sales and EBIT margin
20.000 Sales DKKm EBIT margin 27,9% 30% 18.000 16.000 25% 14.142 14.000 18,5% 16,7% 20% 12.000 10.000 8.146 15% 8.000 6.000 5.033 10% 4.000 5% 2.000 0 0% LATEST RESULTS • OVERVIEW AND STRATEGY • MARKET OVERVIEW • SUSTAINABILITY • FINANCIALS AND GOVERNANCE
Slide 48: Net interest-bearing debt, invested capital, CAPEX
Net Interestbearing debt NIBD/EBITDA 2.000 1,00 1.500 0,80 0,60 1.000 0,40 500 0,20 0 0,00 -500 -0,20 -1.000 -0,40 15.000 Invested Capital ROIC 30% 25% 10.000 20% 15% 5.000 10% 5% 0 0% 1.500 CAPEX CAPEX to Sales 14% 12% 1.000 10% 8% 6% 500 4% 2% 0 0% LATEST RESULTS • OVERVIEW AND STRATEGY • MARKET O
Slide 49: Split of Cost of Goods sold
Split of Cost of Goods sold* • • • • • • LATEST RESULTS • OVERVIEW AND STRATEGY • MARKET OVERVIEW • SUSTAINABILITY • FINANCIALS AND GOVERNANCE
Slide 50: Dividend per share, DKK
Dividend of DKK 4.00 per share for 2016 (up 14% from 2015), corresponding to a total dividend pay-out of DKK 1,190m (pay-out ratio of 39%). Dividend was disbursed on Feb 27 2017 In addition it was decided to initiate a new stock buyback program worth up to DKK 2bn. The program began on January 25 20
Slide 51: Shareholder distribution of B common stock
Shareholder distribution of B common stock* *Distribution equals where shares are managed, Dec 2016 Novo A/S was the only major stockholder holding more than 5% of Novozymes common stock Dec 31 2016 LATEST RESULTS • OVERVIEW AND STRATEGY • MARKET OVERVIEW • SUSTAINABILITY • FINANCIALS AND GOVERNANCE
Slide 52: Structure of the Novo group and ownership
Structure of the Novo group and ownership Purpose of the Foundation: 1. provide a stable basis for the commercial and research activities of the companies in Novo A/S 2. support physiological, endocrinological, metabolic and other medical research 3. contribute to the preservation and operation of N
Slide 53: Further investor relations information
Further investor relations information is available from the company homepage at investors.novozymes.com
Slide 54: Forward Looking Statements
novozymes’ Rethink Tomorrow Forward Looking Statements This presentation and its related comments contain forward-looking statements, including statements about future events, future financial performance, plans, strategies and expectations. Forwarclooking statements are associated with words such a