Sgl Carbon Se · XETR:SGL

Sgl Carbon — SGL Group — Analyst Conference March 2014

35 slides from Sgl Carbon's conference presentation, Mar 10, 2014

  1. Slide 1: Analyst Conference March 2014

    Analyst Conference March 2014 Frankfurt l March 10, 2014

  2. Slide 2: Welcome and Introduction

    Welcome and Introduction Dr. Jürgen Köhler, CEO Page 2 | Analyst Conference March 2014

  3. Slide 3: 2013. One of the toughest years SGL Group has ever faced

    2013. One of the toughest years SGL Group has ever faced  Simultaneous headwinds in major businesses: − Unprecedented and sudden price deterioration in graphite electrodes − Cyclical downturn in graphite specialties − Continued underutilization in our carbon fiber related businesses (excl. JVs with

  4. Slide 4: 2013. Deterioration in GE and GS businesses overshadows some operational highlights

    2013. Deterioration in GE and GS businesses overshadows some operational highlights  Largest single order awarded to GS for a new technology in microelectronics from which GS will benefit in 2014  New isostatic graphite press in Bonn in operation  SGL ACF progressing fast: − Start of 2nd carbon f

  5. Slide 5: 2013. Operationally a very difficult year but groundwork laid for many important changes

    2013. Operationally a very difficult year but groundwork laid for many important changes  Changes in the Supervisory Board (April 30, 2013)  Reduction of and “generation change” in Management Board: − Announced November 2013 − Effective since January 2014  Introduction of cost savings program SGL

  6. Slide 6: SGL2015. Reaction to weak business environment

    SGL2015. Reaction to weak business environment Targets SGL2015:  Improve competitive strength and profitability on a sustainable basis  Sustainable savings of €150 million by end 2015 (compared to actual costs 2012)  €50 million savings in 2013 already (compared to actual costs 2012)  Implementa

  7. Slide 7: SGL2015. Three pillars for improving profitability and market positioning

    SGL2015. Three pillars for improving profitability and market positioning Organizational Asset Portfolio Restructuring Restructuring Restructuring Simplify processes and Adjust asset base to changes Carbon fiber business: focus streamline management in market demand on materials competence structure

  8. Slide 8: 2013 Financials

    2013 Financials Jürgen Muth, CFO Page 8 | Analyst Conference March 2014

  9. Slide 9: 2013. Results for Performance Products (PP) impacted by price pressure

    2013. Results for Performance Products (PP) impacted by price pressure in graphite electrodes in € million 2013 2012* Sales revenue 755.9 940.7 EBITDA before non-recurring charges** 110.2 220.4 EBIT before non-recurring charges** 69.4 179.2 EBIT-Margin before non-recurring charges (in %)** 9.2 19.0

  10. Slide 10: 2013. Results for Graphite Materials & Systems (GMS)

    2013. Results for Graphite Materials & Systems (GMS) reflect cyclical downturn in major end markets in € million 2013 2012* Sales revenue 408.1 486.2 EBITDA before non-recurring charges** 48.7 86.6 EBIT before non-recurring charges** 30.1 67.4 EBIT-Margin before non-recurring charges** (in %) 7.4 13

  11. Slide 11: 2013. Results for Carbon Fibers & Composites (CFC)

    2013. Results for Carbon Fibers & Composites (CFC) continue to be affected by underutilization in € million 2013 2012* Sales revenue 309.3 214.1 EBITDA before non-recurring charges** -16.2 -6.8 EBIT before non-recurring charges** -32.9 -23.9 EBIT-Margin before non-recurring charges** (in %) -10.6 -1

  12. Slide 12: 2013. Results for Central T&I and Corporate Costs

    2013. Results for Central T&I and Corporate Costs benefit from quick implementation of cost savings in € million 2013 2012* Sales revenue / other revenue 3.7 5.0 Central T&I costs (EBIT) -11.5 -11.5 Corporate costs (EBIT) before restructuring expenses -35.6 -46.9 Restructuring expenses -17.8 -  Cor

  13. Slide 13: 2013. Results for the Group marked by high non-recurring charges

    2013. Results for the Group marked by high non-recurring charges and lower EBIT Continuing business in € million 2013 2012* Sales revenue 1,477.0 1,646.0 EBITDA before non-recurring charges 102.1 248.8 EBIT before non-recurring charges 19.5 164.4 Non-recurring charges -226.9 -54.2 Results from At-Eq

  14. Slide 14: 2013. More than €300 million non-recurring charges

    2013. More than €300 million non-recurring charges relating mainly to SGL2015 & weaker market environment in € million 2013 Non-recurring charges on EBIT line 226.9 - Of which restructuring expenses 84.2 - - Closure Lachute 21.6 - - Closure Narni 32.1 - - Organizational restructuring (incl. reductio

  15. Slide 15: 2013. Balance Sheet heavily impacted by non-recurring items

    2013. Balance Sheet heavily impacted by non- recurring items. Positive free cash flow Continuing business in € million 31.12.2013 31.12.2012* Total assets 2,009.2 2,559.7 Equity ratio (in %) 32.4 41.7 Total liquidity 227.8 355.9 Net debt 447.7 459.3 Gearing (net debt/equity) 0.69 0.43 Continuing bus

  16. Slide 16: 2013. Successful refinancing in December 2013 prolongs maturity profile

    2013. Successful refinancing in December 2013 prolongs maturity profile SGL Group established a long  €250 million Corporate Bond at 4.875% (maturity 2021) term financial structure in December 2013  €200 million credit facility, undrawn (maturity 2017)  €134.7 million* Convertible Bond at 3.5%, a

  17. Slide 17: SGL2015 Progress

    SGL2015 Progress Dr. Gerd Wingefeld, CTO Page 17 | Analyst Conference March 2014

  18. Slide 18: SGL2015. Three pillars for improving profitability and market positioning

    SGL2015. Three pillars for improving profitability and market positioning Organizational Asset Portfolio Restructuring Restructuring Restructuring Simplify processes and Adjust asset base to changes Carbon fiber business: focus streamline management in market demand on materials competence structure

  19. Slide 19: SGL2015. Organizational restructuring

    SGL2015. Organizational restructuring A Reducing personnel costs by streamlining corporate and service functions Board of Management -40% − Affecting approximately 300 jobs Upper Management -22% − Primarily at management levels Middle Management -14% Employees -14% B Substantial reduction in indirec

  20. Slide 20: SGL2015. Asset restructuring

    SGL2015. Asset restructuring Adjusting production network to changed demand and market environment  Closure of Canadian facility in Lachute − Production to be phased out by end Q1-2014 − Reducing 30,000 t graphite electrode capacity − 110 jobs cut  Closure of Italian facility in Narni − Reducing 3

  21. Slide 21: SGL2015. Portfolio restructuring

    SGL2015. Portfolio restructuring Focusing our carbon fiber business on core activities  Disposal of rotor blade activities − Sale of all shares in SGL Rotec to a strategic investor as per December 31, 2013 − Strong cooperation in carbon and glass material supply to continue  Next steps − Review of

  22. Slide 22: SGL2015. Schedule for implementation

    SGL2015. Schedule for implementation  Implementation of organizational restructuring project by end 2014  Other SGL2015 projects running simultaneously 2013 2014 2015 SGL2015 Organizational- restructuring Analysis Implementation Asset & portfolio Ongoing projects Ongoing projects (responsibility l

  23. Slide 23: Technology & Innovation

    Technology & Innovation Dr. Gerd Wingefeld, CTO Page 23 | Analyst Conference March 2014

  24. Slide 24: Technology & Innovation. Vision & Mission

    Einführung Technology & Innovation. Vision & Mission Vision Core competencies Market drivers “Megatrends“  Carbon and graphite materials  Energy efficiency ”We are the leading know-how  Renewable energies Carbon Company“  High temperature processes  Lightweight construction Mission  Safeguard

  25. Slide 25: Technology & Innovation. Concentration on four core areas of research

    Technology & Innovation. Concentration on four core areas of research Carbon fibers & composite materials Energy systems  Precursor Materials for:  Carbon fibers  Lithium Ion Batteries  Duroplasts and  Redox Flow Batteries thermoplasts  Fuel cells  Thermal Management Synthetic graphite Cerami

  26. Slide 26: Selected R&D Activities. Electric mobility

    Selected R&D Activities. Electric mobility Basic Research Project with European α-Laion Partners (MaLiSu) Lithium Sulphur Graphite Anode Materials Carbon Silicon Anode Material Batteries 400 Energy density (Wh/kg) Lighter batteries Gen 4 and larger reach 300 Li-Sulfur LIB Gen 3 200 LIB Gen 1 + 2 100

  27. Slide 27: Selected R&D Activities. Industrial cooperations create synergies

    Selected R&D Activities. Industrial cooperations create synergies Development of competence for cell production  Research production line at ZSW Ulm  Cooperation with industrial partners along the value chain  First phase of production for lithium ion battery cells to be completed mid 2015 Quelle

  28. Slide 28: Summary and Outlook

    Summary and Outlook Dr. Jürgen Köhler, CEO Page 28 | Analyst Conference March 2014

  29. Slide 29: SGL Group. New streamlined business structure

    SGL Group. New streamlined business structure resulting from SGL2015 organizational restructuring Graphite & Cathodes & Graphite Process Carbon Aero- JVs Carbon Furnace Specialties Technology Fibers & structures - SGL ACF Electrodes Linings (GS) (PT) Composite (AS) - Brembo SGL (GCE) (CFL) Materials

  30. Slide 30: SGL Group. Preliminary pro forma 2013 financials under new structure

    SGL Group. New business structure impacts reporting structure: Preliminary pro forma 2013 financials 2013 in € million Sales EBIT* Performance Products (PP) 756 69 Graphite Specialties (GS) 297 16 Carbon Fibers & Composite Materials (CF/CM incl. 51% SGL ACF) 252 -28 Corporate & Others (includes PT,

  31. Slide 31: Outlook 2014. Improvement in smaller businesses offset by graphite electrodes

    Outlook 2014. Improvement in smaller businesses will be more than offset by graphite electrode development  Performance Products (PP): Significantly lower sales and EBIT compared to FY2013 expected due to lower graphite electrode prices and volumes  Graphite Specialties (GS): Double digit growth i

  32. Slide 32: Outlook 2014. Another difficult year operationally

    Outlook 2014. Another difficult year operationally  Group Sales: − Expected stable compared to FY2013 excluding currency effects and potential portfolio adjustments − Includes proportional consolidation of our 51% share in the BMW JVs, SGL ACF  Group EBIT before restructuring expenses: anticipated

  33. Slide 33: 2014. We are working hard to regain sustainable profitability

    2014. We are working hard to regain sustainable profitability  Measures as defined in cost savings program SGL2015 will be continued vigorously  Implementation of new corporate culture: − Smaller Board of Management empowers BUs and Corporate Functions: “listen to the experts” − We continue to inc

  34. Slide 34: Thank you for your attention! Your questions, please

    Thank you for your attention ! Your questions, please Page 34 | Analyst Conference March 2014

  35. Slide 35: Important note

    Important note This presentation contains forward looking statements based on the information currently available to us and on our current projections and assumptions. By nature, forward looking statements are associated with known and unknown risks and uncertainties, as a consequence of which actua

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