Navigator Company Sa · EURONEXT:NVG
Navigator Company Sa — The Navigator Company — Q3 2022 Earnings Presentation
25 slides from Navigator Company Sa's earnings presentation, Oct 28, 2022
Slide 1: Q3 / 9M 2022 Results Presentation
Q3 / 9M 2022 Results Presentation October 28th 2022
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 Investor Relations Ana Canha 2
Slide 4: Q3 / 9M 2022 Results Presentation: Main Highlights
Q3 / 9M 2022 RESULTS << PRESENTATION 01 02 03 Market & Main Group Outlook Highlights Performance 33
Slide 5: Q3 2022 | Continued Strong Performance
Q3 2022 | CONTINUED << STRONG PERFORMANCE ▪ Exceptional market conditions with: • Unprecedented high prices driven by global imbalance between demand and supply in pulp market; • UWF lower availability driven by significant capacity exits across Europe together with further temporary downtimes due t
Slide 6: 9M 2022 Financial Highlights
9M 2022 FINANCIAL HIGHLIGHTS << Navigator remains focused on the sustainability of its operations, increasing productivity and energy efficiency. Turnover of € 1,822 million (+63%) and record high EBITDA of € 552 million (+124% YoY). 9M 9M Q3 Q2 In millions € 9M’22-9M’21 QoQ 2022 2021 2022 2022 Turn
Slide 7: Main Quarter Highlights
MAIN QUARTER HIGHLIGHTS << Turnover, EBITDA and operating cash flow registered outstanding performances. Strong Paper and Tissue sales. Market Pulp volumes decrease reflects the need to replenish pulp stocks to minimum service levels and higher integration into paper and tissue. Operational Cash Tur
Slide 8: EBITDA YoY Analysis
EBITDA YoY Analysis << M€ Favorable price evolution across all businesses sustained by unique S/D conditions and efficiency performance outweighed rising costs in raw materials, energy and logistics. +306 (+124%) 515 7 -47 50 552 -27 -193 246 R21 Price Volume Logistics Costs FX Other R22 A B C Upwar
Slide 9: EBITDA QoQ Analysis (1/2)
EBITDA QoQ Analysis (1/2) << Q3 2022 vs Q2 2022 M€ Led by limited supply, rising Pulp & Paper market prices offset persistent cost increases. -16 (-7%) 46 8 -10 -7 223 -3 207 -49 R22 Q2 Price Volume Logistics Costs FX Other R22 Q3 A B C Implemented price improvements Lower UWF volumes compared with
Slide 10: EBITDA QoQ Analysis (2/2)
EBITDA QoQ Analysis (2/2) << M€ Q3 2022 vs Q3 2021 Price increases implemented during the last 12 months offset persistent rise in costs. +112 (+117%) 207 2 -16 22 207 -67 -35 96 R21 Q3 Price Volume Logistics Costs FX Other R22 Q3 A B C Superior prices across all UWF (+5%) & Tissue (+3%) sales Globa
Slide 11: Q3 / 9M 2022 Results Presentation: Market & Group Performance
Q3 / 9M 2022 RESULTS << PRESENTATION 01 02 03 Market & Main Group Outlook Highlights Performance 10 10
Slide 12: Pulp & Paper Prices in 2022
PULP & PAPER PRICES IN 2022 << PRICES AT HISTORICAL LEVELS BHKP pulp price index in Europe currently at 1,411 EUR/t1 (1,380 USD/t1) A4 B-copy prices up 38% since the beggining of the year to 1,344 EUR/t1. European market paper price – A4 B-Copy and BHKP (€) 1460 A4 B-copy BHKP 1380 1300 Average BHKP
Slide 13: Update on the Pulp Market
UPDATE ON THE PULP MARKET << • BHKP in Europe | 1,411 EUR/t1 (+40% vs start of the year). PRICE • BHKP in China | 865 USD/t1 (+50% vs start of the year). • 9M European BHKP average prices (EUR/t) 45% higher YoY. • Global imbalance between supply and demand, due to: -Strike in Northern European mills
Slide 14: UWF Market Conditions
UWF MARKET CONDITIONS << • Index price for A4 paper at 1,344 EUR/t1 (+38% vs start of the year). PRICE • Average prices along the first 9M 2022 up to 1,172 EUR/t compared to 9M 2021 (824 EUR/t). • General price increases for Paper&Board throughout 9M in Europe, Americas, Africa and the Middle East,
Slide 15: Navigator Paper Performance
NAVIGATOR PAPER PERFORMANCE << ▪ Navigator continues with strong order books and a low level of stocks. ▪ The Company managed to improve its product mix, achieving a remarkable level of sales on premium share of 68% (+19 pp, YoY) and mill brand share of 76% (+9 pp, YoY). ▪ Navigator’s market-share i
Slide 16: Tissue Business
TISSUE BUSINESS << Solid tissue performance with sales from Finished Goods growing 3% YoY. SALES1 9M 2022 (vs 9M 2021) Type Segment2 Geography2 Finished Goods 80% 72% 47% Portugal At Home (46%) (77%) (73%) Reels 20% Away From Home 28% Spain 37% (23%) (27%) (36%) Extra Iberia 16% (18%) • Total tissue
Slide 17: From Fossil to Forest
FROM FOSSIL TO FOREST << BAGS CORRUGATED BOARD FLEXIBLE PACKAGING (retail, food & filling industries, etc.) (packs, pouches, food take-away, envelopes, etc.) (agriculture, industry, retail, e-commerce, etc.) • Sales above € 70 million in the first 9 months of 2022 • More than 170 customers l Reachin
Slide 18: Free Cash Flow
FREE CASH FLOW << −Strong cash flow generation of € 322 million, an increase of circa 77% YoY. −Working capital in line with trend of growing expansion in activity. -62 M€ (-16%) 385 83 322 -65 57 -89 82 -131 Operating CAPEX Inventories Clients State & Suppliers Other Free Cash Cash Flow Public Flow
Slide 19: Net Debt
NET DEBT << Net Debt significant reduction to € 372 million, despite the € 100 million dividend payment in the first half. Net Debt/EBITDA ratio remains at historically low levels (0.56x), reflecting the Group’s solid financial position. M€ Without IFRS 16 18
Slide 20: Maturity and Liquidity
MATURITY AND LIQUIDITY << Navigator has diversified sources of funds and extended average tenure. The Company has more than 90% of its interest rates hedged and approximately 40% of total borrowing issued on a sustainable basis. Debt maturity profile (September 22) € 150M Sustainability Total debt:
Slide 21: A Bioindustry on the Right Side of the Future
NAVIGATOR JOINED << SBTi BY YEAR-END 2021 A BIOINDUSTRY ON THE RIGHT SIDE OF THE FUTURE The Science Based Targets initiative (SBTi) has approved Navigator’s near-term science-based GHG emissions reduction targets Commitment to reduce Commitment to reduce absolute scope 1 and 2 absolute scope 3 GHG G
Slide 22: Takeaways
<< TAKEAWAYS • Strong quarter driven by tight market dynamics, productivity measures and appropriate price increases in pulp, paper, tissue together with successful product mix management. • Tight supply and market´s preference for Navigator products and brands ensured high order books in the paper
Slide 23: Q3 / 9M 2022 Results Presentation: Outlook
Q3 / 9M 2022 RESULTS << PRESENTATION 01 02 03 Market & Main Group Outlook Highlights Performance 22 22
Slide 24: Outlook
OUTLOOK << Q4 started with historically high prices and European industry´s order books at high levels due to paper scarcity. Strong start though significant uncertainties for Q4 2022: ▪ Uncertain macroeconomic and geopolitical environment; ▪ Strong inflationary pressure, rising interest rates and t
Slide 25: Q3 / 9M 2022 Results Presentation
Q3 / 9M 2022 Results Presentation October 28th 2022
The Navigator Company — Q3 2022 Earnings Presentation on 6ix