Imerys Sa · EURONEXT:NK
Imerys Sa — H1 2015 Earnings Presentation
36 slides from Imerys Sa's earnings presentation, Jul 29, 2015
Slide 1: First-Half 2015 Results
First-Half 2015 Results July 29, 2015 Conference call Gilles MICHEL – Chairman & Chief Executive Officer Olivier PIROTTE – Chief Financial Officer 1
Slide 2: Disclaimer
Disclaimer More comprehensive information about Imerys may be obtained on its website (www.imerys.com), under Regulated Information, including its Registration Document filed under No. D.15-0173 on March 19. 2015 with Autorité des marchés financiers. Imerys draws the attention of investors to the “R
Slide 3: First-half 2015 results
July 29, 2015 conference call First-half 2015 results S&B integration Outlook 3
Slide 4: Results increase in first-half 2015
Results increase in first-half 2015 Current operating income 1 up + 10.6% to €274 M Positive contribution from S&B and favorable currency impact and lower energy costs Current operating income improving in all business groups excluding ceramic proppants Net income from current operations up + 11.0%
Slide 5: Key figures
Key figures Revenue: + 11.9% Current operating income: + 10.6% (M€) 2,057 274 1,881 1,838 244 248 13.0% 13.5% 13.3% H1 13 H1 14 H1 15 H1 13 H1 14 H1 15 Operating margin Solid cash flow from operations Current net income: + 11.0% 141 129 304 316 106 158 175 155 H1 13 H1 14 H1 15 H1 13 H1 14 H1 15 Yea
Slide 6: Diverging market trends in first half 2015
Diverging market trends in first half 2015 Emerging H1 2015 vs. H1 2014 Western Europe North America countries New housing Renovation Steel production Automotive industry Printing and writing paper Consumer goods Shale gas n.s n.s 6 July 29, 2015 I First Half 2015 results
Slide 7: Revenue increase to €2,057 M
Revenue increase to €2,057 M + 11.9% (M€) + 147 - 5.3% On current basis + 27 + 143 (98) + 1.4% 2,057 + 8.0% Like-for-like change 1,838 + 7.8% - 3.9% Q1 Q2 LFL - 4.5% - 3.3% Excl. ceramic proppants - 3.5% - 1.3% 1st half 2014 Group structure Exchange rates Volumes Price/Mix 1st half 2015 S&B integrat
Slide 8: Current operating income up by + 10.6%
Current operating income up by + 10.6% (M€) + 10.6% 24.1 (48.5) On current basis 12.2 0.2 (1.6) 19.9 20.0 274.0 247.7 13.5% Operating margin 13.3% COI H1 2014 Group Exchange Volumes Price/mix Variable costs Fixed costs & Other COI H1 2015 structure rates general expenses Operating margin holding up
Slide 9: Improved current operating income
Improved current operating income (M€) Current operating income by business group 274 248 104 107 88 72 S&B -11 ceramic proppants 69 64 58 41 37 H1 14 H1 15 H1 14 H1 15 H1 14 H1 15 H1 14 H1 15 H1 14 H1 15 Energy Solutions Filtration Ceramic Materials High Resistance Minerals Group & Specialties & Pe
Slide 10: Energy Solutions & Specialties
Energy Solutions & Specialties (31% of consolidated revenue in H1 2015) (M€) H1 2015 revenue - 4.1% LFL vs H1 2014; slight LFL 624 636 increase excluding ceramic proppants (+ 0.6%) 621 3 main businesses holding up well 10.9% 11.5% Expansion of specialty applications (plastic films, 10.1% 324 312 pol
Slide 11: Filtration & Performance Additives
Filtration & Performance Additives (25% of consolidated revenue in H1 2015) (M€) 600 525 S&B integrated over a 4-month period 500 S&B 400 322 325 306 Like-for-like revenue up + 3.2% Good momentum in Europe and the US 300 New applications developed for the automotive industry, 17.9% 219 200 16.8% pen
Slide 12: Ceramic Materials
Ceramic Materials (28% of consolidated revenue in H1 2015) (M€) H1 2015 revenue vs. H1 2014 622 582 592 + 1.8% on current basis; - 4.0% LFL 17.9% 18.0% Minerals for Ceramics 17.4% 291 301 Core markets performing well Positive contribution from business segment and geographical diversification Roofin
Slide 13: High Resistance Minerals
High Resistance Minerals (16% of consolidated revenue in H1 2015) (M€) 338 329 H1 2015 revenue vs. H1 2014 330 + 0.4% on current basis ; - 8.9% LFL 12.5% 11.1% 11.1% 165 165 Fused Minerals Quarter-on-quarter improvement Activities in China refocused Bahreïn plant progressively ramping up H1 2013 H1
Slide 14: Net income from current operations up + 11.0%
Net income from current operations up + 11.0% M€ H1 2014 H1 2015 Change Current operating income(1) 247.7 274.0 + 10.6% Current financial expense (27.9) (23.5) of which: Interest expense, net (20.1) (26.7) Average net financial debt for the period 893 1.379 Current income tax (62.1) (74.1) Current t
Slide 15: Solid cash flow generation in first half 2015
Solid cash flow generation in first half 2015 M€ H1 2014 H1 2015 EBITDA 338.4 381.2 Change in operating WCR (57.4) (38.3) WCR as a % of revenue 22.4% 23.1% Paid capital expenditure (106.6) (121.5) Current notional tax (70.0) (81.0) Current free operating cash flow(1) 105.7 141.4 Booked capital expen
Slide 16: Healthy financial situation maintained
Healthy financial situation maintained (M€) Change in net financial debt Current free operating cash flow(1) Financial resources Dividends 133 (142) Other 44 Total amount: €2.9 bn (maturity: 4.8 years) 1,488 Available resources excluding cash: €957 M Acquisitions, 583 net(2) Long-term debt rated by
Slide 17: S&B integration
July 29, 2015 conference call First-half 2015 results S&B integration Outlook 17
Slide 18: Acquisition of S&B, a world player in industrial minerals
Acquisition of S&B, a world player in industrial minerals Revenue: €412 M (2) Bentonite Continuous casting(1) (47% of revenue) (22%) 1,500 employees 97% of revenues generated outside Greece Operating in 22 countries #1 #2 #1 worldwide in Europe worldwide Performing and competitive industrial footpri
Slide 19: Annual synergies expected to exceed €25 M in 2018
Annual synergies expected to exceed €25 M in 2018, of which half to be effective in 2016 Integration progressing well Timeline for synergy realization 100% Development synergies 90% Group offering expansion Stronger geographical footprint 50% Acceleration in R&D and innovation 20% Cost synergies Con
Slide 20: Outlook
July 29, 2015 conference call First-half 2015 results S&B integration Outlook 20
Slide 21: Outlook
Outlook Group’s markets and regions expected to continue to show contrasting trends Increase in net income from current operations in 2015 Priorities maintained: tight control over costs, cash and industrial organization Development strategy to be pursued further 21 July 29, 2015 I First Half 2015 r
Slide 22: Appendices
July 29, 2015 conference call Appendices 22
Slide 23: First half 2015 highlights
First half 2015 highlights Acquisition in progress: Solvay’s European precipitated calcium Acquisition in progress: BASF’ s carbonates division (PCC), a US paper hydrous kaolin European leader in thin and ultra- business thin solutions for specialty USA applications New capacity: launch of a Europe
Slide 24: Industrial production indicators
Industrial production indicators European industrial output US industrial output 110 European industrial output (as of end April 2015) US industrial output (as of end May 2015) (base 100: 2007; source: OECD) (base 100: 2007; source: US Federal Reserve) 105 110 100 105 95 100 90 85 95 80 90 April 201
Slide 25: Other market indicators
Other market indicators Printing paper production in mature countries Printing paper production in emerging countries - 2.1% Q2 2015 vs. Q2 2014 + 0.7% Q2 2015 vs. Q2 2014 25 000 12 500 12 000 20 000 11 500 15 000 MT 11 000 MT 10 000 10 500 10 000 5 000 9 500 0 9 000 Source: RISI and Imerys estimate
Slide 26: Breakdown of revenue by region in H1 2015
Breakdown of revenue by region in H1 2015 (M€) Other (Japan/ Australia) 5% Emerging markets 26% Western Europe 44% o/w France 12% USA / Canada 25% 26 July 29, 2015 I First Half 2015 results
Slide 27: Breakdown of revenue by end market
Breakdown of revenue by end market <2% of sales each End-markets < 2% Building - New 2-4% of sales 12-15% of 13% each Business Paper sales each Food & Beverage 13% Renovation Packaging Consumer Goods 5% Publishing 12% 6.5% Iron & Steel Industrial Equipment 6.5% 10% 8% Commercial Automotive Printing
Slide 28: Revenue and Current Operating income by quarter
Revenue and Current Operating income by quarter Revenue (M€) Q1 2013 Q2 2013 Q3 2013 Q4 2013 Q1 2014 Q2 2014 Q3 2014 Q4 2014 Q1 2015 Q2 2015 Energy Solutions & Specialties 306.7 313.8 319.9 307.8 303.2 321.1 338.9 315.5 312.5 323.6 Filtration & Performance Additives 155.7 166.7 159.7 152.6 159.0 165
Slide 29: Current operating income and operating margin by semester
Current operating income and operating margin by semester Current operating income (M€) H1 2012 H2 2012 H1 2013 H2 2013 H1 2014 H2 2014 H1 2015 Energy Solutions & Specialties 77.5 65.7 67.9 60.2 72.1 77.5 64.4 Filtration & Performance Additives 45.4 44.9 51.3 49.6 58.0 55.4 88.0 Ceramic Materials 11
Slide 30: Energy Solutions & Specialties
Energy Solutions & Specialties H1 2015 revenue by region Carbonates: Other (Japan/ Natural (GCC) and Precipitated (PCC) Calcium Australia) Carbonates used as filling or coating pigment for 8% Western paper production and functional additives for paints, Europe plastics etc. 35% Monolithic Refractori
Slide 31: Filtration & Performance Additives
Filtration & Performance Additives H1 2015 revenue by region Filtration & Performance Additives: Other (Japan/ Australia) Performance Minerals (mainly talc, mica and 4% wollastonite): additives for paints, plastics, Western Europe polymers, rubbers, adhesives, sealants, pharma Emerging 36% & persona
Slide 32: S&B's activities integrated in Filtration & Performance Additives
S&B’s activities integrated in the Filtration & Performance Additives business segment from March 1, 2015 Additives for Metallurgy (24%) Filtration & Performance Minerals • Performance Additives (76%) for Casting (bentonite) • Performance Adititves for continuous casting fluxes S&B O/w Wollastonite,
Slide 33: Ceramic Materials
Ceramic Materials H1 2015 revenue by region Roofing: Other (Japan/ Australia) Clay roof tiles in France 2% Emerging countries 17% Minerals for Ceramics: Raw materials and bodies for tableware, Western sanitary and floor tiles, quartz, kiln furniture for Europe the roof tile and ceramics industry 63%
Slide 34: High Resistance Minerals
High Resistance Minerals H1 2015 revenue by region Fused Minerals: Other (Japan/ Australia) Fused alumina and bauxite for abrasives 5% (cutting, grinding and polishing mills, sandpapers), zirconium for refractories, oxygen Western Europe sensors Emerging 39% countries 28% Refractory Minerals: Produc
Slide 35: Current financial expense
Current financial expense M€ H1 2014 H1 2015 Interest expense, net (20.1) (26.7) Unwinding of long-term provisions (1.4) (1.9) and change in other provisions Net interest expense on pensions (3.8) (5.1) Currency translation, other financial income (2.7) 10.2 and expense and financial instruments Cur
Slide 36: Imerys
Imerys 154 rue de l’Université 75007 PARIS + 33 (0) 1 49 55 63 00 www.imerys.com Analysts and investors contact Vincent Gouley + 33 (0) 1 49 55 64 69 vincent.gouley@imerys.com 36