Wienerberger AG · VIE:WIE
Wienerberger — FY2019 Earnings Presentation
43 slides from Wienerberger's earnings presentation, March 2020
Slide 1: Wienerberger Results 2019
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Slide 2: Disclaimer
Disclaimer Cautionary note regarding forward-looking statements ▪ The information contained in this document has not been independently verified and no representation or warranty expressed or implied is made as to, and no reliance should be placed on, the fairness, accuracy, completeness or correctn
Slide 3: 2019: Record year for Wienerberger
2019: Record year for Wienerberger › 4% growth of revenue LFL despite flat to Revenue ✓ softening markets driven by growth › Upgrade of product mix › Higher average prices to cover cost inflation € 587 mn › Focus on strategic growth markets and segments Increased ✓ › profitability › Increased share
Slide 4: Wienerberger achieved its best results in 200 years history
Wienerberger achieved its best results in 200 years history Revenue EBITDA LFL 2) € 3,466.3 mn € 587.5 mn (2018: € 3,305.1 mn | +5%) (2018: € 475.3 mn | +24%) LFL 1): +4% Free cash flow 3) EBITDA LFL margin € 286.0 mn 17.3% (2018: € 272.5 mn | +5%) (2018: 14.4%) 1) Adjusted for effects from consolid
Slide 5: 2019: Record year for Wienerberger
2019: Record year for Wienerberger Substantial shareholder return € 86 mn returned to our shareholders via dividend and share buyback Strong value management ROCE of 10.6% reflects significantly improved operating earnings Disciplined balance sheet management Net debt / EBITDA remains at 1.4x despit
Slide 6: Our operating environment 2019 in Europe
Our operating environment 2019 in Europe New Build | Renovation Infrastructure Slightly increased demand in the first Slightly increased demand in Eastern half of the year driven by beneficial Europe due to EU-funded weather conditions infrastructure projects National regulations and increasing Stab
Slide 7: Our operating environment 2019 in North America
Our operating environment 2019 in North America New Build | Renovation | Infrastructure Continuing competitive landscape in the US brick market Regulatory environment in Canada had still dampening effect on demand Infrastructure projects were influenced by bad weather conditions in first half of the
Slide 8: Wienerberger Building Solutions: Strong earnings improvement
Wienerberger Building Solutions Strong earnings improvement › Strong performance in broadly flat markets WBS (in € mn) 2019 2018 Chg. in % › Covering cost inflation through improved pricing External revenues 2,170.6 2,050.7 +6 › Enhanced revenue share of higher value-adding EBITDA LFL 455.4 369.1 +2
Slide 9: Wienerberger Piping Solutions: Significant earnings growth
Wienerberger Piping Solutions Significant earnings growth › Stable demand for infrastructure and water WPS (in € mn) 2019 2018 Chg. in % management solutions External revenues 959.4 946.4 +1 › Focus on innovative, higher value-adding solutions EBITDA LFL 100.0 70.1 +43 › Fast Forward initiatives res
Slide 10: North America: Satisfactory performance in mixed environment
North America Satisfactory performance in mixed environment › Highly satisfactory earnings in facade business North America (in € mn) 2019 2018 Chg. in % despite highly competitive landscape External revenues 335.7 306.8 +9 › Implementation of Fast Forward performance enhancement initiatives EBITDA
Slide 11: Group Strategy: Focused on value creation
Group Strategy Focused on value creation 1 2 3 Organic Operational Growth projects growth Excellence Portfolio optimization Strong track record in consistent implementation of our sustainable growth strategy 11
Slide 12: Organic growth: Our growth drivers
1 Organic growth Our growth drivers Innovative solutions Digitalization › Electrical spider concept › Wienerberger Building platform › Pre-fabricated electrical power supply based on › All4Roof digital plan › Digital Building Libraries › Reduces installation time from 16h to 3h Value adding applicat
Slide 13: Operational Excellence: Fast Forward contribution ahead of plan
2 Operational Excellence Fast Forward contribution ahead of plan Fully on track to realize full › Fast Forward performance enhancement € 120 mn performance improvement program delivers ahead of plan: € 50 mn EBITDA contribution in 2019 Manufacturing Excellence › Continuous focus on improving product
Slide 14: Growth projects: Acquisition of BPD Group
3 Growth projects Acquisition of BPD Group › BPD is a specialist producer of accessories for roofing solutions and the building envelope › Important further step towards becoming an integrated supplier of full-range roofing and building envelope solutions › Acquisition of BPD grows our addressable s
Slide 15: Portfolio optimization: Acquisition of Danish facade businesses
3 Portfolio optimization Acquisition of Danish facade businesses › Strengthening of market position in residential Current production site construction as well as commercial and public projects in the attractive Nordic facade market New production site › Enhanced product portfolio and distribution p
Slide 16: Value management: Committed to maximizing shareholder value
Value management Committed to maximizing value for our shareholders › ROCE serves as key indicator for: ROCE grew by > 1,000 basis points since 2012 › value oriented management of our 12.0% company 10.6% Mid-term target › capital allocation decisions 10.0% › Significant growth since 2012 8.0% 7.3% 7
Slide 17: Return of capital to shareholders
Return of capital to shareholders Selective share buyback complement dividend › Strong increase of proposed Dividend increase by 400% since 2012 dividend to € 0.60 per share reflects strong operating 0.70 performance 0.60 0.60 › Buyback and cancellation of 0.50 0.50 1% of shares issued in 2019 in €
Slide 18: Summary highlights 2019
Summary highlights 2019 Clear focus on sustainable growth and cash generation ✓ Record sales and earnings in 200 years history due to consistent implementation of sustainable growth strategy ✓ Strong focus on innovation and enhanced revenue share of high value-adding solutions ✓ Significant earnings
Slide 19: Financials 2019
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Slide 20: Wienerberger achieved its best results in 200 years history
Wienerberger achieved its best results in 200 years history Revenue EBITDA LFL 2) € 3,466.3 mn € 587.5 mn (2018: € 3,305.1 mn | +5%) (2018: € 475.3 mn | +24%) LFL 1): +4% Free cash flow 3) EBITDA LFL margin € 286.0 mn 17.3% (2018: € 272.5 mn | +5%) (2018: 14.4%) 1) Adjusted for effects from consolid
Slide 21: LFL EBITDA development
LFL EBITDA development 650 610.0 EBITDA adjustments (in € mn) 2019 2018 600 587.5 EBITDA reported 610.0 442.6 -22.5 FX -0.1 - 550 Consolidation 1) -13.7 - in € mn Sale of assets 2) -8.7 -23.2 500 Structural adjustments 3) +0.0 +55.8 +32.6 475.3 Total adjustment -22.5 +32.6 EBITDA LFL 587.5 475.3 450
Slide 22: Income statement
Income statement in € mn 2019 2018 Chg. in % Revenues 3,466.3 3,305.1 +5 EBITDA LFL 587.5 475.3 +24 EBITDA 610.0 442.6 +38 EBIT 362.7 239.8 +51 Financial result -47.4 -44.5 -7 Profit before tax 315.3 195.3 +61 Income taxes -52.5 -48.5 -8 Profit after tax 262.8 146.9 +79 Hybrid coupon and non-control
Slide 23: Cash flow development
Cash flow development in € mn 2019 2018 Chg. in € mn Chg. in % Gross cash flow 476.7 326.5 +150.2 +46 Change in working capital 1) -46.9 -7.1 -39.8 <-100 Maintenance capex -140.1 -130.3 -9.8 -8 Divestments and other 39.3 83.3 -44.1 -53 Lease payments 2) -42.9 0.0 -42.9 <-100 Free cash flow 286.0 272
Slide 24: Total investments
Total investments in € mn 2019 2018 Chg. in % Maintenance capex 140.1 130.3 +8 in % of depreciation & amortization 57% 67% - Special capex 115.4 85.6 +35 Total investments 255.5 215.8 +18 M&A 47.9 79.2 -40 Total investments and M&A 303.3 295.0 +3 › Strict financial discipline › Clear guidance for ma
Slide 25: Net Debt Development
Net Debt Development 1.000 900 19.2 800 215.0 700 42.9 600 56.6 in € mn 500 71.8 39.3 871.4 400 476.7 303.3 300 631.6 200 46.9 100 0 › Net debt development driven by IFRS 16 Leases effect › Due to strong financial discipline, nearly stable without IFRS 16 25 Non-cash increase of net debts due to fir
Slide 26: Balance sheet ratios and KPIs
Balance sheet ratios and KPIs in € mn 2019 2018 Chg. in % ROCE 1) 10.6% 7.5% - Equity 2) 2,076.8 1,939.1 +7 Equity ratio 50.3% 51.8% -3 Net debt 871.4 631.6 +38 Net debt / EBITDA 1.4 1.4 - Gearing 42.0% 32.6% - › Mid-term ROCE target >10% has been exceeded for the first time as a result of the stron
Slide 27: Balanced financing structure
Balanced financing structure › Cash 31/12/2019: € 129 mn › Credit lines: € 400 mn › Thereof drawn 31/12/2019: € 40 mn › Term structure: 600 500 400 Undrawn credit lines in € mn 300 200 First-Call Date Hybrid 100 0 2020 2021 2022 2023 2024 after 2024 Maturities Cash balance 27
Slide 28: Balance sheet management
Balance sheet management Attractive refinancing of Corporate Bond 2020 through first Green Loan Clear commitment to Consistent implementation of the Refinancing of the 2013-2020 sustainability goals through sustainability strategy has a positive corporate bond at attractive initial green financing e
Slide 29: Implementation of IFRS 16
Implementation of IFRS 16 › Extension of the balance sheet Effects of implementation FY2019 › Recognition of “Right of Use Asset” and “Lease Liability” Income Statement in € mn › Effects on income statement EBITDA +46.5 › EBITDA: no rental / leasing expenses Depreciation -44.6 › EBIT: Rental / l
Slide 30: Outlook
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Slide 31: Wienerberger is well-positioned for sustainable growth
Wienerberger is well-positioned for sustainable growth Strategic › Innovations and the continuous strategic ✓ transformation transformation toward a solution provider drive further organic growth › Fast Forward will contribute a further € 50 million Well Fast to EBITDA positioned ✓ Forward › Success
Slide 32: Outlook 2020 Europe
Outlook 2020 Europe New Build | Renovation Infrastructure Continuation of regional trends Slightly increasing demand in Eastern leading to stable and slightly Europe due EU-funded infrastructure softening building activities projects Expected lower demand for new build single and multi-family homes;
Slide 33: Outlook 2020 North America
Outlook 2020 North America New Build | Renovation|Infrastructure Broadly stable relevant regional markets for US bricks and infrastructure products in a rather competitive market environment Slightly improving market conditions in Canada 33
Slide 34: Our clear strategy and sustainability focus areas
Our clear strategy and sustainability focus areas position Wienerberger for future success Entrepreneurial success based on sustainability strategy 2020+ Organic De-Carbonization of Growth Wienerberger’s Product Portfolio Operational Encourage Circular Excellence Economy Growth projects Preserve Por
Slide 35: Strategic focus topics
Strategic focus topics Building Solutions Piping Solutions North America › Consolidation and new materials › Further develop value-adding › Drive market penetration in strategic solutions in the inhouse segment growth areas supported by digital › Develop integrated system solutions agenda and enhanc
Slide 36: De-carbonization of Wienerberger's Product Portfolio
De-carbonization of Wienerberger’s Product Portfolio › Wienerberger will make sure that all of its products during their lifecycle will positively contribute to de-carbonation and enable a negative carbon footprint › Update of our Materiality Analysis in 2020 › Clear measurable targets for 2023 for
Slide 37: Example: DRYFiciency in Austria
Example: DRYFiciency in Austria › Technical innovation significantly reduces thermal energy consumption › Installation of a high temperature heat-pump in our model plant › Converting waste heat from dryer to energy for the kiln › Increase of energy efficiency up to 80% and reduction of CO2-Emissions
Slide 38: Encourage Circular Economy
Encourage Circular Economy › Wienerberger commits to resource efficiency as well as encouragement of circular economy › We will actively promote that all products produced by Wienerberger are either reusable or fully recyclable › Update of our Materiality Analysis in 2020 › Clear measurable targets
Slide 39: Example: Specific successes Piping Solutions
Example: Specific successes Piping Solutions › Target 2020 of share of secondary raw materials in plastic pipe production was reached already in 2018 › 75 kg/ton in 2018 World of › 85 kg/ton in 2019 Wienerberger
Slide 40: Preserve Biodiversity
Preserve Biodiversity › Wienerberger commits to and actively preserves biodiversity › We will undertake all actions to contribute positively in order to increase biodiversity in the regions where we are active › Update of our Materiality Analysis in 2020 › Clear measurable targets for 2023 for the e
Slide 41: Example: Project in Belgium
Example: Project in Belgium › Natural barrier to protect residents and animals from factory operations › Ideally suited for the settlement of endangered animal populations › Eco-corridor connects the nature reserve of the Belgian bank of the Albert Canal with the Dutch nature reserve along the Meuse
Slide 42: Outlook 2020
Outlook 2020 EBITDA LFL € 625 - 645 mn* Fast Forward € 50 mn EBITDA contribution ROCE target >10% Balance Sheet Ratios Net Debt / EBITDA <2.5x Working capital / revenues <20% Maintenance capex ~ € 140 mn Special capex Discretionary investments in Fast Forward and organic growth projects M&A We conti
Slide 43: Wienerberger geared for growth
wienerberger geared for growth Projekt Wienerberger AG 43