Navigator Company Sa · EURONEXT:NVG
Navigator Company Sa — The Navigator Company — Q1 2020 Earnings Presentation
29 slides from Navigator Company Sa's earnings presentation, May 26, 2020
Slide 1: Q1 2020 Results Presentation
Q1 2020 Results Presentation May 26th 2020
Slide 2: Disclaimer
DISCLAIMER This presentation is intended to provide a general overview of The Navigator Company S.A.’s business and does not purport to deal with all aspects and details regarding The Navigator Company S.A.. This presentation has been prepared by The Navigator Company S.A. for information purposes o
Slide 3: Participation
<< PARTICIPATION António Redondo Adriano Silveira Executive Directors Fernando Araújo João Lé João Paulo Oliveira Nuno Santos Investor Relations Joana Appleton 2
Slide 4: Main Highlights
Q1 2020 RESULTS PRESENTATION << 01 02 03 Market & Covid-19 Main Group Impact & Highlights Performance Outlook 3
Slide 5: Q1 2020 – Strong improvement in operational performance
Q1 2020 – Strong improvement in << operational performance • Significant improvement in operational performance across the Group´s mills • Beginning of 2020 marked by a very strong recovery in our paper order book • Difficult comparison with Q1 2019, as UWF prices reached a peak in that period; but
Slide 6: Q1 2020 Financial Highlights
Q1 2020 Financial Highlights << Turnover declined 3.8% YoY and 1.9% QoQ on In millions € Q1 Q4 Change Q1 Change the back of lower pulp and paper prices 2020 2019 QoQ 2019 YoY Increase in volumes sold and lower production costs (variable & fixed) mitigated decline in Turnover 405.8 413.6 -1.9% 421.8
Slide 7: Main quarter highlights
Main quarter highlights << Operational Cash Turnover (M €) EBITDA (M €) Flow (M €) -1.9% +23% 432 +20% 422 420 414 406 105 102 93 88 72 88 80 80 Solid order book and increase in volumes 59 71 sold led to a stable turnover UWF prices stabilized between Q4 2019 Q1 Q2 Q3 Q4 Q1 Q1 Q2 Q3 Q4 Q1 Q1 Q2 Q3 Q
Slide 8: EBITDA QoQ Analysis
EBITDA QoQ Analysis << Higher EBITDA QoQ as the significant improvement on the operational performance led to savings in both variable and fixed costs +17 (+23%) 29 88 -10 72 -3 1 UWF UWF Wood Pulp Pulp Chemicals Tissue Tissue External fibers Fixed costs R19 Q4 Price Volume Costs Other R20 Q1 A B C
Slide 9: EBITDA YoY Analysis
EBITDA YoY Analysis << Decrease in prices from historically high levels offset by increase in volumes and cost savings (Wood, Chemicals, External Fibers and Fixed Costs) -17 (-16%) 105 -37 19 88 13 -11 UWF UWF Wood Pulp Pulp Chemicals Tissue Tissue External fibers Fixed costs R19 Price Volume Costs
Slide 10: Market & Group Performance
Q1 2020 RESULTS PRESENTATION << 01 02 03 Market & Covid-19 Main Group Impact & Highlights Performance Outlook 9
Slide 11: Pulp prices remain low but stable throughout Q1 2020
PULP PRICES REMAIN LOW BUT << STABLE THROUGHOUT Q1 2020 With market discounts increasing, net prices are currently at the lowest level since 2014 PIX Europe USD/ton BHKP EUR/ton BHKP 1100 1000 1000 900 Eur / Ton 900 800 USD / Ton Average pulp prices 800 700 2014-18 2019 Q1 2020 700 600 USD 817 855 6
Slide 12: Recap on the pulp market
RECAP ON THE PULP MARKET << • Worldwide pulp demand grew +13% YTD February, with an estimated performance for Q1 2020 in line or slightly above (approximately + 15% YoY) • Supply was affected by unplanned stoppages and production cuts, particularly in short fiber from Asian producers whilst in Europ
Slide 13: Paper prices correcting in Q1 2020
PAPER PRICES CORRECTING << IN Q1 2020 EUROPEAN MARKET PAPER PRICE – A4 B-COPY 950 900 850 Average A4 B-Copy price Eur/Ton 800 2014-18 2019 Q1 2020 Av. 2014: Av. 2015 Av. 2016: Av. 2017: Av. 2018: Av. 2019: Av. YTD: 750 827 € 822 € 823 € 815 € 873 € 903 € 859 € EUR 832 903 864 (Var. W1-52: -2.5%) (Va
Slide 14: UWF Market Conditions
UWF Market Conditions << PULP Hardwood pulp prices have stabilized, remaining flat at 680 USD/ton since January 2020 PRICE Demand weakening by the end of Q1, with the impact of the pandemic and consequent lockdown measures clearly affecting paper consumption; UWF global demand fell 6.4% in DEMAND Q1
Slide 15: Navigator Paper & Pulp Performance
NAVIGATOR PAPER & PULP PERFORMANCE << PAPER PERFORMANCE • UWF output increased 5% YoY and 12% QoQ and sales volume increased 4% Q1 2020 vs Q1 2019, and remained flat from Q4 to Q1 • Order book close to record levels throughout most of Q1 • Average price for Q1 2020 was down 6% vs Q1 2019 and flat vs
Slide 16: Record Performance in Tissue
Record Performance in Tissue << 45% Away-from-Home +C&C 41% Portugal Revenue by Revenue by segment 46% Consumer geography 34% Spain (Q1 2020) (Q1 2020) 9% Parent Reels 25% Extra-Iberia • Sales turnover increased to € 36 million, representing a growth of 8% YoY and 18% QoQ • Global volume of tissue s
Slide 17: Capex of €22.7 Million
CAPEX OF € 22.7 Million << (VS € 32.5 Million) Reduction in capex Q1 2020 of almost € 10 million vs. Q1 2019 CAPEX Q1 2020 M€ 22.7 6.6 2.4 Capex over the last 5 13.7 Quarters (M €) 70 32 36 20 23 Q1 Q2 Q3 Q4 Q1 CAPEX Q1 2020 Core Business improvement Environment Maintenance, Efficiency Capex improve
Slide 18: Free Cash Flow Improvement
FREE CASH FLOW IMPROVEMENT << Free Cash Flow evolved positively to € 15 million and compares favorably with FCF of € 10 million in Q1 2019; increase in clients and inventories in Q1 reflect change vs. year-end 2019, where a significant effort was made to anticipate receivables and when inventories a
Slide 19: Net Debt at €800 Million
NET DEBT at € 800 MILLION << Net debt increased € 85M* vs year-end 2019, after the Group proceeded to the distribution of € 100 million in reserves in January M€ 796 776 800 738 742 740 732 715 693 683 677 617 2.3 559 1.9 1.8 1.9 1.8 1.9 1.7 1.7 1.6 1.6 1.5 1.5 1.3 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q
Slide 20: Conservative Debt Profile
Conservative Debt Profile << Navigator increased significantly its short term liquidity to 256 M€ at the end of March and has no significant repayments in 2020 Debt maturity profile Total debt: € 1,055.2 million Average maturity: 3 years Current Average Cost of Debt 287 299 Debt Rate Profile (March
Slide 21: Covid-19 Impact & Outlook
Q1 2020 RESULTS PRESENTATION << 01 02 03 Market & Covid-19 Main Group Impact & Highlights Performance Outlook 20
Slide 22: Executive Committee focus on Covid-19 context
Executive Committee focus << on Covid-19 context Community Business People Continuity Ensuring a prompt response to unprecedented times 21
Slide 23: Actions taken to take care of our People
Actions taken to take care of our People << Contingency plan drawn in Februrary, progressively updated design to protect the health of all employees, their families and our communities, as well as our suppliers and clients Implementation of preventive, sanitisation and strict containment measures ac
Slide 24: Actions taken to take care of our Community
Actions taken to take care of our << Community Donation of safety equipment to the Hospital of Setúbal and Hospital of Aveiro and to the paediatric ward of the Hospital of Setúbal Jointly donation of the latest radiology to District Hospital of Figueira da Foz* Paper initiatives: donation to 3600 ch
Slide 25: Actions taken to take care of our Business
Actions taken to take care of our Business << Creation of a Crisis Management Office in charge of managing and overseeing the evolution of Covid-19 Business continuity plan: support across the supply chain, control of operations at all mill sites and significant reinforcement of IT systems (allowing
Slide 26: Deteriorating market conditions as result of Covid-19
Deteriorating market conditions as result of << Covid-19 Consequences of Lockdown Partial stoppage of Paper production With schools, universities and offices Pulp adjustment closing, the sudden and End of March marked by unexpected economic a downturn in order Solid performance on slowdown affected
Slide 27: Responsive measures taken
Responsive measures << Prompt to taken measures secureto preserve business well business being well being Efficiency and cost reduction programmes Capex Annual target for reduction Capital expenditure for in fixed costs in 2020 of € 2020 revised from an 45 million Liquidity estimated €158 million to
Slide 28: Short-term outlook and challenges for 2020
<< Short-term • Q2 will be very challenging and marked by great uncertainty outlook and challenges for 2020 • Recovery will depend on the rhythm of reduction in lockdown measures PULP PAPER TISSUE • Demand is expected to fall significantly in • Continued growth is perceived • Increase in NVG pulp sa
Slide 29: Q1 2020 Results Presentation
Q1 2020 Results Presentation May 26th 2020
The Navigator Company — Q1 2020 Earnings Presentation on 6ix