Wacker Chemie Ag · XETR:WCH

Wacker Chemie — Investor Day (March 2022)

57 slides from Wacker Chemie's investor day presentation, Mar 29, 2022

  1. Slide 1: Capital Markets Day 2022

    29th of March 2022 CAPITAL MARKETS DAY 2022 Wacker Chemie AG Dr. Christian Hartel, CEO Dr. Tobias Ohler, CFO Bilanzpressekonferenz 2020 16. März 2021 0

  2. Slide 2: Accelerating Proven Successes @ Maintaining Resilience

    ACCELERATING PROVEN SUCCESSES @ MAINTAINING RESILIENCE Bilanzpressekonferenz 2020 16. März 2021 1

  3. Slide 3: Creating Tomorrow's Solutions

    CREATING TOMORROW’S SOLUTIONS We have We develop We are close We have benchmark great people innovative to our customers quality and solutions in all regions best-in-class assets Bilanzpressekonferenz 2020 16. März 2021 2

  4. Slide 4: Our solutions make a better world for generations

    CREATING TOMORROW’S SOLUTIONS We have We develop We are close We have benchmark great people innovative to our customers quality and solutions in all regions best-in-class assets ...and we are driven by a COMMON PURPOSE: Our solutions make a better world for generations Bilanzpressekonferenz 2020 16

  5. Slide 5: Our solutions make a better world for generations

    OUR SOLUTIONS MAKE A BETTER WORLD FOR GENERATIONS ADVANCED BIOPHARMA HEALTH AND WELL-BEING SMART CONSTRUCTION SEMICONDUCTOR RENEWABLE ENERGY RENEWABLES-BASED PRODUCTS E-MOBILITY Bilanzpressekonferenz 2020 16. März 2021 4

  6. Slide 6: CMDs for Biosolutions and Polysilicon held in 2021

    CMDs FOR BIOSOLUTIONS AND POLYSILICON HELD IN 2021 BIOSOLUTIONS POLYSILICON We are a Leading Microbial and We are Strong #1 in Semi and Advanced Medicines CDMO Quality Leader in Solar Bilanzpressekonferenz 2020 16. März 2021 5

  7. Slide 7: Strongly accelerating growth in Chemicals

    NEW: STRONGLY ACCELERATING GROWTH IN CHEMICALS SILICONES POLYMERS We are Global #2 with We are Global #1 in VAE Full Specialty Portfolio and Innovation Leader Customer’s first choice for innovative solutions Bilanzpressekonferenz 2020 16. März 2021 6

  8. Slide 8: Targets 2030

    TARGETS 2030 SALES: > 10 bn EUR VOLUME/MIX CAGR: 1.5 – 2 x Historic CREATING ROCE: 2x Cost of Capital TOMORROW’S SOLUTIONS EBITDA Margin: > 20% CO 2 e: - 50% Emissions Bilanzpressekonferenz 2020 16. März 2021 7

  9. Slide 9: Proven Successes

    PROVEN SUCCESSES Bilanzpressekonferenz 2020 16. März 2021 8

  10. Slide 10: Leverage phase completed with transformation to full specialty setup

    LEVERAGE PHASE COMPLETED WITH TRANSFORMATION TO FULL SPECIALTY SETUP CHEMICALS BIOSOLUTIONS POLYSILICON Specialty transformation Biotechnology foundation High-end focus Strong profitability Innovation and technologies #1 in semi Regional expansion Bolt-on acquisitions Improved mix Focused investment

  11. Slide 11: Silicones: Transformation to specialty supplier completed

    SILICONES: TRANSFORMATION TO SPECIALTY SUPPLIER COMPLETED Sales in €m, Specialty Share We deliver unmatched performance in a wide range of applications EBITDA 12% 21% Margin We have benchmark production and 2,600 service close to our customers 1,650 We are our customers’ first choice innovation part

  12. Slide 12: Polymers: Offering customized services with global footprint

    POLYMERS: OFFERING CUSTOMIZED SERVICES W/ GLOBAL FOOTPRINT Sales in €m, Asia Share We drive performance-based substitution in global construction and binder markets EBITDA 15% 15% Margin We support sustainability and smart 1,680 construction as megatrends Asia 1,000 We offer customized services in t

  13. Slide 13: Biosolutions: Fast growing biotechnology business created

    BIOSOLUTIONS: FAST GROWING BIOTECHNOLOGY BUSINESS CREATED Sales in €m We are building a strong-growing BioPharma CDMO EBITDA 16% 13% Margin We have successfully acquired and integrated 300 four biotech sites during the leverage phase 13% CAGR BioPharma We have jump-started into 155 & Bio- Advanced M

  14. Slide 14: Polysilicon: Leadership in high-end applications established

    POLYSILICON: LEADERSHIP IN HIGH-END APPLICATIONS ESTABLISHED EBITDA in €m We serve fast-growing demand for EBITDA 26% 43% high quality semi-grade and solar material Margin 650 We have doubled our semi volumes Price Mix We are the market leader for high-end solar 290 Cost We have cut our cash costs b

  15. Slide 15: Chemicals: Specialty focus and regional expansion paid off

    CHEMICALS: SPECIALTY FOCUS AND REGIONAL EXPANSION PAID OFF CHEMICALS EBITDA in €m CHEMICALS ROCE EBITDA 15% 19% 19% Margin 805 29% 710 27% 19% 440 Ø 2012–2016 Ø 2017–2021 2021 Ø 2012–2016 Ø 2017–2021 2021 Bilanzpressekonferenz 2020 16. März 2021 14

  16. Slide 16: Leverage phase has resulted in strong financials

    LEVERAGE PHASE HAS RESULTED IN STRONG FINANCIALS WACKER Net Cashflow in €m WACKER Net Cash Position in €m 550 -930 -260 760 420 35 Ø 2012–2016 Ø 2017–2021 2021 Ø 2012–2016 Ø 2017–2021 2021 Bilanzpressekonferenz 2020 16. März 2021 15

  17. Slide 17: Ready for the next step: switching gears to meet customer pull

    READY FOR THE NEXT STEP: SWITCHING GEARS TO MEET CUSTOMER PULL Bilanzpressekonferenz 2020 16. März 2021 16

  18. Slide 18: Now: Accelerating for our customers' growth

    NOW: ACCELERATING FOR OUR CUSTOMERS’ GROWTH CHEMICALS BIOSOLUTIONS POLYSILICON Accelerate Growth Incubate, Innovate, Grow Strengthen Semi Position Demand pull from Demand pull from advanced Demand pull from rapidly sustainability medicine and clean food growing semi/solar markets First choice for in

  19. Slide 19: Sustainability is the value driver

    SUSTAINABILITY IS THE VALUE DRIVER Already 2/3 of Sales with resource saving technologies Bilanzpressekonferenz 2020 16. März 2021 18

  20. Slide 20: Chemicals

    CHEMICALS SILICONES POLYMERS Bilanzpressekonferenz 2020 16. März 2021 19

  21. Slide 21: Silicones: Sustainability pull for specialty solutions

    SILICONES: SUSTAINABILITY PULL FOR SPECIALTY SOLUTIONS Sustainable Raws Durability and Renewable E-Mobility Performance Energy Bilanzpressekonferenz 2020 16. März 2021 20

  22. Slide 22: Silicones: Strongly accelerating global specialty growth

    SILICONES: STRONGLY ACCELERATING GLOBAL SPECIALTY GROWTH Our actions – Building on our strengths #2 in North America #1 in HCR #1 in India Full Specialty Portfolio Supplier Silicone Consumption per Capita 50x Bilanzpressekonferenz 2020 16. März 2021 India USA 21

  23. Slide 23: Polymers: Pull from sustainability and smart construction

    POLYMERS: PULL FROM SUSTAINABILITY AND SMART CONSTRUCTION Customized Global climate Plastic to paper Sustainable solutions policies trend product solutions China “30/60” Bilanzpressekonferenz 2020 16. März 2021 22

  24. Slide 24: Polymers: Push market penetration by doubling capacity

    POLYMERS: PUSH MARKET PENETRATION BY DOUBLING CAPACITY Our actions – Building on our strengths Lead the transformation to high construction standards in emerging markets Moscow Burghausen Istanbul Seoul/Ulsan Calvert City Allentown Dalton Dubai Nanjing Mumbai Shanghai Accelerate regionalization with

  25. Slide 25: Chemicals: Meeting fast-growing demand with investments for specialty capacities

    CHEMICALS: MEETING FAST-GROWING DEMAND WITH INVESTMENTS FOR SPECIALTY CAPACITIES Double CapEx until 2030 CHEMICALS CapEx in €m Accelerate Chemical capacities in all regions >400 Diversified portfolio of downstream projects Upstream investments, 200-250 solely for specialty growth Bilanzpressekonfere

  26. Slide 26: New Chemicals Targets 2030

    NEW CHEMICALS TARGETS 2030 FASTER GROWTH, BOLDER MOVES, HIGHER PROFITABILITY VOLUME/MIX CAGR: 1.5 – 2 x Historic CREATING EBITDA Margin: > 20% TOMORROW’S SOLUTIONS ROCE: > 2x Cost of Capital Bilanzpressekonferenz 2020 16. März 2021 25

  27. Slide 27: Biosolutions

    BIOSOLUTIONS Bilanzpressekonferenz 2020 16. März 2021 26

  28. Slide 28: Biosolutions: Pull from fast-growing biotechnology markets

    BIOSOLUTIONS: PULL FROM FAST-GROWING BIOTECHNOLOGY MARKETS Advanced High growth Health and Fermentation- Medicines potential CDMO wellbeing trend based ingredients mRNA/pDNA outsourcing Bilanzpressekonferenz 2020 16. März 2021 27

  29. Slide 29: "One billion from Bio" – shift to higher margins

    BIOSOLUTIONS: “ONE BILLION FROM BIO" – SHIFT TO HIGHER MARGINS Our actions – Building on our strengths Sales EBITDA Expand product portfolio and technologies >25% Margin with internal innovation, partnerships, M&A €1bn Increase biotech capacities in Europe and US to meet growing demand 13% €300m Con

  30. Slide 30: Polysilicon

    POLYSILICON Bilanzpressekonferenz 2020 16. März 2021 29

  31. Slide 31: Polysilicon: High demand, benchmark quality & sustainability

    POLYSILICON: HIGH DEMAND, BENCHMARK QUALITY & SUSTAINABILITY Fast-growing Strong customer High efficiency Best-in-class chip demand cooperation modules sustainability Bilanzpressekonferenz 2020 16. März 2021 30

  32. Slide 32: Polysilicon: Strengthen #1 position in semi

    POLYSILICON: STRENGTHEN #1 POSITION IN SEMI Semi Volume Growth Annual Semi CapEx in €m 2x 3x Targets 2030 > 30% EBITDA Margin 2x 100 > 2x Cost of Capital 30 2017 2021 2025e 2030e Ø 2019–2021 Ø 2022–2024 Bilanzpressekonferenz 2020 16. März 2021 31

  33. Slide 33: Introducing Group Targets 2030

    INTRODUCING GROUP TARGETS 2030 CHEMICALS BIOSOLUTIONS POLYSILICON Accelerate Growth Incubate, Innovate, Grow Strengthen Semi Position EBITDA Margin EBITDA Margin EBITDA Margin > 20% > 25% > 30% ROCE ROCE ROCE > 2x Cost of Capital Bilanzpressekonferenz 2020 16. März 2021 >> 1x Cost of Capital > 2x Co

  34. Slide 34: 50% reduction in CO2 emissions by 2030

    50% REDUCTION IN CO 2 EMISSIONS BY 2030 – FIRST SUCCESSES ACHIEVED WACKER CO2e in m t (Scope 1 & 2) -50% Holla: First Green PPAs From Wind and Hydro Target 3.6 2030 Nanjing: Coal-Based Steam Cut by 50% 1.8 Silicon Process metal transfor- Green 2020 Growth Holla mation energy 2030e Bilanzpressekonfer

  35. Slide 35: Targets 2030

    TARGETS 2030 SALES: > 10 bn EUR VOLUME/MIX CAGR: 1.5 – 2 x Historic CREATING ROCE: 2x Cost of Capital TOMORROW’S SOLUTIONS EBITDA Margin: > 20% CO 2 e: - 50% Emissions Bilanzpressekonferenz 2020 16. März 2021 34

  36. Slide 36: Our foundation: Maintaining resilience

    OUR FOUNDATION: MAINTAINING RESILIENCE Bilanzpressekonferenz 2020 16. März 2021 35

  37. Slide 37: Maintaining resilience in unprecedented volatility

    MAINTAINING RESILIENCE IN UNPRECEDENTED VOLATILITY Pandemic Regulation Supply Chain Raw Materials Geopolitical Disruptions and Energy Conflicts Bilanzpressekonferenz 2020 16. März 2021 36

  38. Slide 38: Sourcing initiatives to mitigate price volatility

    SOURCING INITIATIVES TO MITIGATE PRICE VOLATILITY Long-term strategies Short-term actions LTAs, selective backward integration Tactical buying to exploit pricing volatility Diversified supplier portfolio Further expanding supplier portfolio Staggered contract portfolio E-auctions Hedging strategies

  39. Slide 39: Selective backward integration focused on margin stabilization and sustainability

    SELECTIVE BACKWARD INTEGRATION FOCUSED ON MARGIN STABILIZATION AND SUSTAINABILITY Production silicon metal at Holla (Norway) Site acquired in 2010 Continuous modernization and expansion Supply chain stability, margin stabilization Outlook: CO2-neutral silicon metal Bilanzpressekonferenz 2020 16. Mär

  40. Slide 40: Pricing power to protect financial performance

    PRICING POWER TO PROTECT FINANCIAL PERFORMANCE CHEMICALS: Successful pricing initiatives VAM-Prices (€/mt) POLYMERS 3,000 2x Ø2020 Ø2021 2,500 2,000 Several price increases and temporary surcharges 1,500 1,000 Absolute EBITDA almost flat in 2021 0 2020 2021 SILICONES EBITDA POLYMERS (€m) Surging sil

  41. Slide 41: Adjusting pricing models to compensate inflation

    ADJUSTING PRICING MODELS TO COMPENSATE INFLATION Model for Specialty Pricing Pricing Adjustments Customer benefit enables value-add pricing Shorter contract duration for specialties Price adjustments over contract duration High stability and predictability of sales Clauses protecting against inflati

  42. Slide 42: Lean cost structure from ongoing initiatives

    LEAN COST STRUCTURE FROM ONGOING INITIATIVES Overall Cost – "Shape the Future“ Operational Efficiency – “WOS” Savings in €m vs. 2019 Savings in €m vs. prior year 200 250 115 160 75 50 2020 2021 2022e 2023e Ø 2017–2021 2021 Addressing all indirect/non-operative functions POLYSILICON: Cost road maps C

  43. Slide 43: Strong balance sheet: resilience for growth

    STRONG BALANCE SHEET: RESILIENCE FOR GROWTH Balance Sheet 2021 8.1 €bn 8.1 €bn Non-current assets Equity 38% Equity increased to 3.1 €bn Asset Intensity reduced 49% over leverage phase Financial debt 18% Net financial asset of ~ 550 €m Working capital Pension provisions DIO: 64 days, DSO: 45 days 25

  44. Slide 44: Going forward: Highly profitable growth and shareholder returns

    GOING FORWARD: HIGHLY PROFITABLE GROWTH AND SHAREHOLDER RETURNS Bilanzpressekonferenz 2020 16. März 2021 43

  45. Slide 45: Introducing Group Targets 2030

    INTRODUCING GROUP TARGETS 2030 CHEMICALS BIOSOLUTIONS POLYSILICON Accelerate Growth Incubate, Innovate, Grow Strengthen Semi Position EBITDA Margin EBITDA Margin EBITDA Margin > 20% > 25% > 30% ROCE ROCE ROCE > 2x Cost of Capital Bilanzpressekonferenz 2020 16. März 2021 >> 1x Cost of Capital > 2x Co

  46. Slide 46: Clear path forward: Focus on growth and value

    CLEAR PATH FORWARD: FOCUS ON GROWTH AND VALUE Key Initiatives and Performance Indicators 2022 - 2026 CHEMICALS BIOSOLUTIONS POLYSILICON Further regionalizing supply chain Strong investment in innovation Investments in semi and and earnings-accretive bolt-ons and early-stage bolt-ons cost efficiency

  47. Slide 47: Flexibility for financial leverage: 1.0x EBITDA

    FLEXIBILITY FOR FINANCIAL LEVERAGE: 1.0X EBITDA Target Range Defined by Net Financial Debt / EBITDA Target Range 1.2 1.0 0.4 -0.4 2013 2017 2021 Flexibility Target Range – Leverage Phase Update Target range set at 0.5 – 1.0x EBITDA Flexibility set at 1.0x EBITDA If outside target range, actions to b

  48. Slide 48: Priorities for capital allocation

    PRIORITIES FOR CAPITAL ALLOCATION Growth 1 CapEx and M&A Shareholder Returns 2 Dividends Pensions 3 Reform Bilanzpressekonferenz 2020 16. März 2021 47

  49. Slide 49: CapEx with focus on highly profitable growth

    CAPEX WITH FOCUS ON HIGHLY PROFITABLE GROWTH Target CapEx Split 2022 – 2026 High-Return Growth CapEx Accelerate Chemical Capacities in all regions Close to customers Sustainability/MoB Growth Short supply chain Diversified portfolio of downstream projects Upstream investments solely for specialty gr

  50. Slide 50: Increasing importance of M&A

    INCREASING IMPORTANCE OF M&A – DIFFERENT FOCUS IN CHEMICALS AND BIOSOLUTIONS M&A Transactions 2013-2022 M&A Transaction Criteria 2022 SICO – Specialty Silanes BIOSOLUTIONS New technology / extend product portfolio 2021 Genopis – CDMO p-DNA Early-stage assets / create synergies Lagging effect on sale

  51. Slide 51: Dividend policy confirmed – strong commitment to shareholders

    DIVIDEND POLICY CONFIRMED – STRONG COMMITMENT TO SHAREHOLDERS Dividend (€) Payout to Shareholders Total Payout 2013-21: ~1.2 €bn 4.50 8.00 Bonus 0.50 2.50 2.50 0.50 1.50 2.00 2.00 2.00 2013 2014 2015 2016 2017 2018 2019 2020 2021 (proposed) ≥ 25% of net income ~50% of net income from continuing oper

  52. Slide 52: Initiatives underway to reduce pension deficit

    INITIATIVES UNDERWAY TO REDUCE PENSION DEFICIT Pensions Provisions (€m) 3.80% 1.25% 0.70% 1.24% Discount rates 2,710 2,280 1,810 1,080 DTA related to pensions 1,790 2,090 1,460 910 Net provision for pensions 2013 2019 2020 2021 Situation Outlook Volatility from fluctuations in discount rates Sensiti

  53. Slide 53: Maintaining resilience, highly profitable growth and shareholder returns

    MAINTAINING RESILIENCE, HIGHLY PROFITABLE GROWTH AND SHAREHOLDER RETURNS Bilanzpressekonferenz 2020 16. März 2021 52

  54. Slide 54: Targets 2030

    TARGETS 2030 SALES: > 10 bn EUR VOLUME/MIX CAGR: 1.5 – 2 x Historic CREATING ROCE: 2x Cost of Capital TOMORROW’S SOLUTIONS EBITDA Margin: > 20% CO 2 e: - 50% Emissions Bilanzpressekonferenz 2020 16. März 2021 53

  55. Slide 55: Bilanzpressekonferenz 2020 16. März 2021

    Bilanzpressekonferenz 2020 16. März 2021 54

  56. Slide 56: Disclaimer

    DISCLAIMER This presentation contains forward-looking statements based on assumptions and estimates of WACKER’s Executive Board. Although we assume the expectations in these forward-looking statements are realistic, we cannot guarantee they will prove to be correct. The assumptions may harbor risks

  57. Slide 57: Wacker: Issuer, contact and additional information

    WACKER: ISSUER, CONTACT AND ADDITIONAL INFORMATION Issuer and Contact Financial Calendar INVESTOR RELATIONS CONTACTS Joerg Hoffmann, CFA 04/28/22 Q1 2022 Results Tel. +49 89 6279 1633 | joerg.hoffmann@wacker.com 05/20/22 Annual General Meeting Scott McCollister 07/28/22 Q2 2022 Results Tel. +49 89 6

Wacker Chemie — Investor Day (March 2022) on 6ix