Omv Ag · VIE:OMV
Omv — Investor Day (March 2022)
22 slides from Omv's investor day presentation, Mar 16, 2022
Slide 1: Strategy 2030: From Value Chain to Value Circle
STRATEGY 2030 FROM VALUE CHAIN TO VALUE CIRCLE Reinhard Florey Chief Financial Officer March 16, 2022 1 | OMV Capital Markets Day, March 16, 2022 © OMV Group
Slide 2: Disclaimer
Capital Markets Day 2022 Disclaimer This presentation contains forward-looking statements. forward-looking statements may be identified by the use of terms such as “outlook”, “believe”, “expect”, “anticipate”, “intend”, “plan”, “target”, “objective”, “estimate”, “goal”, “may”, “will” and similar ter
Slide 3: Sound financial track record
Financial Framework Sound financial track record Annual average over last 5 years (2017-2021) EUR 3.6 bn Ø 22% Ø EUR 4.8 bn Ø 9% Ø 12.8% Ø Clean CCS Gearing ratio Operating cash Average dividend Total shareholder Operating Result excl. leases flow1 increase per year return2 ● 2021 was a record year
Slide 4: Starting from a highly favorable financial position
Financial Framework Starting from a highly favorable financial position Equity and net debt including leases ● Our balance sheet structure allows for ample EUR bn financing capacity to fund growth opportunities 25 35% and the transition 32% 22.0 30% ● We are strongly committed to maintaining 19.9 20
Slide 5: Clear financial targets and growing shareholder returns
OMV Strategy 2030 Clear financial targets and growing shareholder returns ≥EUR 6 bn ≥EUR 7bn Capital allocation priorities: ~EUR 3.5 bn p.a. organic investments, 1. Organic CAPEX 2030 clean CCS 2030 operating 2. Progressive dividend thereof ~40% in Operating Result cash flow1 3. Inorganic growth low
Slide 6: Our strategy creates cash and earnings upside perspective
Financial Strategy 2030 Our strategy creates cash and earnings upside perspective Cash flow from operating activities Clean CCS Operating Result excluding net working capital effects EUR bn EUR bn ≥7 ≥6 ≥5 ~6 4.9 3.7 2019-2021 avg. p.a. 2025 target 2030 target 2019-2021 avg. p.a. 2025 target 2030 ta
Slide 7: Driving greater value for shareholders, improve earnings quality
Financial Strategy 2030 Driving greater value for shareholders, improve earnings quality Clean CCS EPS EUR 10-12 2030 Outlook 7-8 ● Earnings share below operating line to increase, driven by C&M and low-carbon 5.3 ● By 2030, roughly 50% expected to come from C&M and ~25% each from R&M and E&P ● Earn
Slide 8: Setting capital allocation priorities right
First Things First Setting capital allocation priorities right Organic CAPEX 1 Progressive dividend policy 2 Inorganic spending aimed at accelerating the transition 3 Deleveraging 4 8 | OMV Capital Markets Day, March 16, 2022 © OMV Group
Slide 9: Rising low-carbon CAPEX, driven by initiatives in all businesses
Organic CAPEX Plan 2022-2030 Rising low-carbon CAPEX, driven by initiatives in all businesses Average annual organic CAPEX EUR bn ● Organic CAPEX growth driven by investments in ~3.5 ~3.5 sustainable and low-carbon projects in all three 13% C&M segments 20% 12% R&M ● Organic low-carbon CAPEX will ri
Slide 10: Updated and detailed investment criteria
Capital Allocation Framework Updated and detailed investment criteria Traditional business Low-carbon business (all segments) E&P R&M C&M Segmental country IRR minimum, % 11-17 9-11 10-12 WACC Payback period, years <10 at FID <10 <15 <20 Overall return minimum R O AC E ≥ 1 2 % E&P amortization requi
Slide 11: Fast forward toward transformation
Inorganic Growth Strategy Fast forward toward transformation Strategic criteria Financial criteria ROACE ≥12% Strategic fit Cash profile Return profile ● Complies with overall group path to ● Maximum synergy and growth ● Hurdle rates, payback and net-zero by 2050 potential amortization corresponding
Slide 12: Headroom to drive shareholder returns and inorganic growth
The Engine Driving The Business Refocus Headroom to drive shareholder returns and inorganic growth Sources and uses of cash 2022-2030 Headroom: dividend increase, M&A Additional funding headroom will come from: Dividends ● Low leverage ratio allows for additional debt @ EUR 2.30 DPS financing ● Lift
Slide 13: Targeting synergies of more than EUR 800 mn
Borealis Synergy Program Targeting synergies of more than EUR 800 mn >800 EUR mn by year-end 2025 ● Operational cost savings >200 150-200 150-200 150-200 150-200 ● Combined purchasing ● Debottlenecking ● Value chain optimization ● Tax benefits 2021 Actual 2022 2023 2024 2025 13 | OMV Capital Markets
Slide 14: Strategic portfolio management to transform business at speed
Active Portfolio Management Strategic portfolio management to transform business at speed Clear requirements for core assets Constant asset screening ● Expedites the transition outlines strategic portfolio ● Natural gas vs. crude oil ● Sustainable vs. fossil ● Polymer vs. fuel Value Core assets gene
Slide 15: Long-term funding must be consistent with sustainability goals
New Sustainability-Linked Funding Policy Long-term funding must be consistent with sustainability goals Sustainability-linked bond principles Sustainability Key Second-party Investor performance Funding policy Performance opinion targets Indicators ● Timing depends on funding requirements ● First re
Slide 16: ESG ratings make OMV a leader among its peers
ESG Ratings ESG ratings make OMV a leader among its peers Relative rating Top 10% Top 10% Top 5% Top 7% Top 1% vs. industry peers 26.7 Platinum SCORE 72 AAA B– (medium risk) Medal Publication dates of results: DJSI November 2021, MSCI August 2021, ISS-ESG August 2020, Sustainalytics December 2021, E
Slide 17: Continuation of progressive dividend policy
You Can Count On Us Continuation of progressive dividend policy OMV aims to increase dividends every year or at least to maintain the level of the respective previous year. 17 | OMV Capital Markets Day, March 16, 2022 © OMV Group
Slide 18: Impressive track record
We Kept Our Promise Impressive track record Dividend per share EUR 2.30 1.85 1.75 1.75 1.50 1.20 1.00 2015 2016 2017 2018 2019 2020 2021 18 | OMV Capital Markets Day, March 16, 2022 © OMV Group
Slide 19: Strategy 2030: Delivering sustainable value
In a Nutshell Strategy 2030: Delivering sustainable value ● Changed product portfolio will increase profitability and deliver higher quality earnings ● Strong financial performance of existing businesses drives transition ● Strategic portfolio management to transform business at speed ● Growth optio
Slide 20: 20 | OMV Capital Markets Day, March 16, 2022
20 | OMV Capital Markets Day, March 16, 2022 © OMV Group
Slide 21: Back-up
Back-up 21 | OMV Capital Markets Day, March 16, 2022 © OMV Group
Slide 22: Base case macro assumptions
Financial Strategy 2030 Base case macro assumptions Period averages 2025 2030 Brent oil price (USD/bbl) 65 70 Trading Hub Europe natural gas price (EUR/MWh) 22 24 OMV indicator refining margin Europe (USD/bbl) 4.3 4.3 Europe ethylene/propylene indicator margin (EUR/t) 430 500 Europe PE/PP indicator