Slide 1: Welcome to HEXPOL – Q1 2015 report update
Telephone presentation May 4, 2015, 13:00 CET Please call +46 8213 091 (international call) 020-213 091 (national call, Sweden) 08-213 091 (mobile call, Sweden) and enter meeting code 917 840 Welcome to HEXPOL Q1 2015 report update CEO Georg Brunstam CFO Karin Gunnarsson May 4 2015, 13:00 CET May 4,
Slide 2: Agenda
Agenda • Introduction to HEXPOL • Q1 2015 – HEXPOL Group • Q1 2015 – Business areas • Q1 2015 – Summary • Q&A May 4, 2015 -2-
Slide 3: HEXPOL – Fast growing with strong margins
HEXPOL – Fast growing with strong margins HEXPOL is a world-leading polymers group with strong global positions in advanced Polymer Compounds (Compounding), gaskets for plate heat exchangers (Gaskets) and wheels made of plastic and rubber materials for forklift and castor wheel application (Wheels).
Slide 4: Our vision guides us
Our vision guides us HEXPOL’s vision is to be market leader, number one or two, in selected technological or geographical segments, to generate profit, growth and shareholder value. May 4, 2015 -4-
Slide 5: HEXPOL – A fast growing Group: Strong Growth
HEXPOL – A fast growing Group - Strong Growth Contribution to sales made by acquisitions in the past years (Acquisition month in parenthesis) M SEK 10 000 RheTech (Jan 2015) 9 000 PPP (Dec 2014) 8 000 Vigar (Nov 2014) Kardoes (Aug 2014) 7 000 Robbins (Nov 2012) Müller Kunststoffe (Jan 2012) 6 000 EX
Slide 6: HEXPOL – A fast growing Group: Growth strategy
HEXPOL – A fast growing Group - Growth strategy • Product Development – New segments (for example: flame retardant) – New products in existing segments (for example: weight saving) – Application oriented • Increased market share • Acquisitions mainly within Polymer Compounding – Existing markets (Ka
Slide 7: HEXPOL Compounding
HEXPOL – A fast growing Group - HEXPOL Compounding Value chain (example): Raw material Manufacturer of Rubber and plastic manufacturers component OEMs End customers polymer compounds manufacturers -Rubber -Silicone -TPE -FKM -PP (reinforced) -PA Business model: The market: • “Glocal” (local supplies
Slide 8: HEXPOL – A well positioned Group
HEXPOL – A well positioned Group Main customer segments: • Strong automotive industry • Growth to automotive industries but today lower share of total Group sales thanks to strong growth in other segments. • Automotive sales around 39% (2008 60%). • Engineering and general industry • Construction an
Slide 9: HEXPOL – A well positioned Group
HEXPOL – A well positioned Group • Two business areas – HEXPOL Compounding – HEXPOL Engineered Products • Strong global market positions – Global leader for rubber compounding – Strong European position in Thermoplastic Elastomer Compounding (TPE) – Strong US position for reinforced polypropylene co
Slide 10: HEXPOL – A well positioned Group
HEXPOL – A well positioned Group • True global footprint – 11 of 39 production units in emerging markets • Historical strong sales growth and good profitability • Well invested and strong cash flow • Long industrial history with highly experienced and dedicated management and board • Acquisition ori
Slide 11: With a stable organisation
HEXPOL – A well positioned Group - With a stable organisation Two business areas – HEXPOL Compounding (93 % of sales) – HEXPOL Engineered Products (7 % of sales) HEXPOL HEXPOL AB AB (publ) (publ) HEXPOL HEXPOL HEXPOL Engineered Compounding Compounding Products Global Global Purchasing Purchasing&& T
Slide 12: A favourable sales distribution
HEXPOL – A well positioned Group - A favourable sales distribution Sales per geographic area Jan - Mar 2015 Europe 29% NAFTA 66% Asia 5% May 4, 2015 - 12 -
Slide 13: Strong margin development
HEXPOL – A well positioned Group - Strong margin development M SEK % 10 000 20,0 Sales OM 8 000 16,0 6 000 12,0 8 919 9 739 4 000 8 007 8 036 8,0 7 197 2 000 3 798 4,0 3 190 2 608 0 0,0 2008 2009 2010 2011 2012 2013 2014 Apr 14 - Mar 15 May 4, 2015 - 13 -
Slide 14: Q1 2015 – Very strong growth and strong margins
Q1 2015 – Very strong growth and strong margins - our best quarter so far - Volume and sales increases in all geographical regions - Strong growth mainly thanks to acquired units and positive currency effects 2015 2014 2014 MSEK Q1 Q1 Q4 Net Sales 2 951 2 131 2 331 + 38% Operating Profit, EBIT 495 3
Slide 15: Q1 2015 – Very strong growth – strong margins
Q1 2015 – Very strong growth – strong margins - our best quarter so far - Volume and sales increases in all geographical regions • Integration of units acquired in 2014 and 2015 progressing according to plan • Sales increased by 38% to 2,951 MSEK (2,131) - Sales affected by lower prices for our prin
Slide 16: Acquisitions oriented – Major acquisitions within Polymer Compounding
Acquisitions oriented – Major acquisitions within Polymer Compounding • Elasto (April, 2010) – TPE Compounding - Units in UK and Sweden • Excel Polymers (Nov, 2010) – Rubber Compounding - Units in U.S., Mexico, UK and China • Müller Kunststoffe (Jan, 2012) – TPE Compounding - Units in Germany • Robb
Slide 17: Acquisition of Kardoes Rubber in August 2014
HEXPOL acquisition of Kardoes Rubber in August 2014 • Kardoes Rubber with a manufacturing facility in La Fayette, Alabama, US • Turnover of 43 MUSD in 2013, with an EBITDA margin below HEXPOL Group • Around 90 employees May 4, 2015 - 17 -
Slide 18: Acquired VIGAR Rubber Compounding in November 2014
HEXPOL acquired VIGAR Rubber Compounding in November 2014 • Vigar Rubber compounding with manufacturing facilities in Rubi, Spain and Viersen, Germany • Turnover of 57 MEUR in 2013, with a positive EBITDA margin well below the HEXPOL Group • Around130 employees • Closing of German units announced Ma
Slide 19: Acquired Portage Precision Polymers in December 2014
HEXPOL acquired Portage Precision Polymers in December 2014 • Portage Precision Polymers with two manufacturing facilities in Ohio (Ravenna and Mogadore) US • Turnover of 29 MUSD in 2013, with an EBITDA margin below the HEXPOL Group • The Ravenna facility is not included in the transaction and its b
Slide 20: Acquired RheTech in January 2015
HEXPOL acquired RheTech in January 2015 • RheTech Thermoplastic Compounding have four facilities (including manufacturing and laboratories) located in Whitmore Lake, MI (RheTech), Fowlerville, MI (RheTech), Sandusky, OH (RheTech Color) and in Blacksburg, SC (RheTech Engineered Plastics), US • Turnov
Slide 21: Q1 2015 – Very strong growth and strong margins
Q1 2015 – Very strong growth and strong margins - our best quarter so far - Volume and sales increases in all geographical regions • Net sales increased to 2,951 MSEK (2,131) • Earnings per share increased by 34% to 10.23 SEK – Increase by 38 percent (7.61) • Operating profit increased to 495 MSEK (
Slide 22: Q1 2015 – Sales affected by lower raw material prices
Q1 2015 – Very strong growth and strong margins - our best quarter so far - Volume and sales increases in all geographical regions - Sales affected by lower raw material prices MSEK 2015 2014 Growth Sales 2 951 2 131 38% Currency -436 -20% Ex. Currency 2 515 2 131 18% Acquisition -427 -20% Organic G
Slide 23: Q1 2015 – Strong balance sheet
Q1 2015 – Very strong growth and strong margins - our best quarter so far - Strong balance sheet 2015 2014 2014 MSEK Q1 Q1 Q4 + 38% Net Sales 2 951 2 131 2 331 Operating Profit, EBIT 495 364 344 Operating Margin, % 16.8 17.1 14.8 + 36% Profit after tax 352 262 248 Earnings per share, SEK 10.23 7.61
Slide 24: Q1 2015 – Business areas
Q1 2015 – Business areas Very strong growth and strong margins - our best quarter so far Net Sales Operating Profit Operating Margin, % 2015 2014 2014 2015 2014 2014 2015 2014 2014 MSEK Q1 Q1 Q4 Q1 Q1 Q4 Q1 Q1 Q4 HEXPOL 2 744 1 954 2 148 473 337 325 17.2 17.2 15.1 Compounding HEXPOL Engineered 207 1
Slide 25: Q1 2015 – HEXPOL Compounding
Q1 2015 – HEXPOL Compounding Very strong growth and strong margins -our best quarter so far • NAFTA – sales and volumes well above last year • Sales 40% above last year: – Positive development to automotive – Volume increases in all geographical regions – Weaker volumes to oil and gas, mining – Posi
Slide 26: Q1 2015 – HEXPOL Engineered Products
Q1 2015 – HEXPOL Engineered Products - strong sales • Net sales increased by 17% to 207 MSEK (177) – Positive sales development for HEXPOL Gaskets in all geographical regions – Sales improved for HEXPOL Wheels • Price pressure • Operating profit amounted to 22 MSEK (27) – Insurance compensation 6 MS
Slide 27: Depreciations/amortizations & Investments
HEXPOL Group Depreciations/amortizations & Investments MSEK 200 150 100 50 0 2007 2008 2009 2010 2011 2012 2013 2014 Apr 14 - Mar 15 Depreciation/amortisation Investments • Investments in line with depreciations/amortisations • Mainly capacity investments in Mexico and within TPE Compounding • Maint
Slide 28: Q1 2015 – Very strong growth and strong margins
Q1 2015 – Very strong growth and strong margins - our best quarter so far - Volume and sales increase continue in all geographical regions • Sales increased by 38 per cent to 2,951 MSEK (2,131) - Sales affected by lower prices for our principle raw materials which have been lower this quarter compar
Slide 29: Q & A
Q&A May 4, 2015 -29- jaterial Difference