Brenntag Se · XETR:BNR
Brenntag — Investor Day (November 2022)
83 slides from Brenntag's investor day presentation, Nov 10, 2022
Slide 1: Brenntag
2 BRENNTAG
Slide 2: Disclaimer
Disclaimer This presentation may contain forward-looking statements based on current assumptions and forecasts made by Brenntag SE and other information currently available to the company. Various known and unknown risks, uncertainties and other factors could lead to material differences between the
Slide 3: Agenda
Agenda Capital Markets Day 2022 Introduction to Brenntag CMD 2022 Thomas Altmann, Senior VP Corporate Investor Relations Shaping the future of sustainable chemical and ingredients distribution Dr. Christian Kohlpaintner, CEO Digital.Data.Excellence: Delivering EUR 200m net annual EBITA uplift by 202
Slide 4: = BRENNTAG
= BRENNTAG
Slide 5: Shaping the future of sustainable chemical and ingredients distribution
Shaping the future of sustainable chemical and ingredients distribution
Slide 6: Brenntag is the undisputed and resilient leader delivering consistent growth
Brenntag is the undisputed and resilient leader delivering consistent growth S03 Our unique platform... | ..is outperforming” Global market leader with superior offering Operating Gross Profit >2x Op. EBITA equivalent to ~7% CAGR COVID-19 Unparalleled product portfolio, application Financial Asset l
Slide 7: Project Brenntag: Recapping our strategic objectives
Project Brenntag: Recapping our strategic objectives = Differentiated business steering = Remove redundancies = Leverage economies of scale Operating model = Stringent customer segmentation = Fit-for-purpose sales organisation = Dedicated sales teams for BSP and BES Go-to-market approach = Reduce co
Slide 8: We have exceeded our ambitions well ahead of plan
We have exceeded our ambitions well ahead of plan Key objective Evidenced deliverables Operating Two distinct world BSP BES model class divisions 5p, Co 5 ol an EUR 220m p. p. Gross Profi Operating EBITDA uplift ~ . Go-to-market Clear customer Dedicated and focused win OD iff Hepes approach segmenta
Slide 9: We fully delivered against our medium term guidance
We fully delivered against our medium term guidance Organic underlying fi 4% p.a. 4% - 6% p.a. business Organic Operating Gross Profit Organic Operating EBITDA Project EUR 220m Brenntag Operating EBITDA uplift by FY2023 EUR 200-250m p.a. Proven track record
Slide 10: Distribution is an attractive and indispensable market, growing faster than chemical manufacturing
Distribution is an attractive and indispensable market, growing faster than chemical manufacturing Distributors are an indispensable channel... Chemical distributors Connect 1,000s of suppliers and customers Extensive technical and application know-how Highest safety and compliance standards Capabil
Slide 11: Increasing specialisation of suppliers requires an evolution in distributors' capabilities
Increasing specialisation of suppliers requires an evolution in distributors’ capabilities , 3 ARKEMA — AsohiKASEL Ashland CLARIANT™ <B> Sosm UPON.) @evonk = ExonMobil — <S> Formosa Plastics! Reubach —LANXESS. «= @LGChem — LOMZE__—Wondellbasell AY Pvesscmioe Nouryon QD — th snccrem (WACKER “Toray” .
Slide 12: Leadership in both markets requires two tailored strategies
Leadership in both markets requires two tailored strategies Key industry requirements Reinforce supplier strategies to drive growth Offer specific customized solutions Master Digital & Data driven business models Foster sustainability trends Drive market consolidation and efficiency gains Source: BC
Slide 13: Customer needs are becoming more differentiated, requiring tailored propositions
Customer needs are becoming more differentiated, requiring tailored propositions Application Industrial customers Focus on “no frills” Specialties customers = Focus on technical expertise and innovation Specialties Delivery with seamless * Comprehensive product, operational integration portfolio = V
Slide 14: Brenntag is the undisputed global leader in a highly fragmented market
Brenntag is the undisputed global leader in a highly fragmented chemical and ingredients distribution market... Chemical and ingredients distribution sales-based market share (%), 2021”) Top 6 have 12% market share USD 290 bn 88% 0.9% Les. 1.2% skit — 100% 3% a 2.8% — P| 5.0% ; | D Univar Kolmar IMC
Slide 15: The only true global player in both Specialties and Industrial markets
and the only true global player in both Specialties and Industrial markets Sales FY21 in EUR bn Brennta Brenntag | 6.0 Technical expertise delivered via 81 ‘entiators IMCD B84 We are the largest application laboratories s Aes ° specialties player SSE EES leveraging our global Azelis 2.8 setup Leader
Slide 16: Brenntag connects key stakeholders across the distribution ecosystem
Brenntag connects key stakeholders across the distribution ecosystem Employees Politics/ regulator Customers Supply partners Local communities Indirect suppliers Service & technology partners End consumers (broader public) Product-, knowledge- and innovation-driven interconnected ecosystem of partne
Slide 17: Purpose
17 Purpose Connecting with products, knowledge and innovation Fostering a sustainable future Caring for human needs Vision 2030 We shape the future of our industry by empowering our partners within networks driving collaboration, excellence and shared success We are guided by our purpose and vision
Slide 18: Introducing Horizon 2: Strategy to win
Introducing Horizon 2: “Strategy to win” Horizon 3: Leader in all dimensions We realize the true potential of Brenntag Horizon 1: Project Brenntag We make Brenntag fit for future growth
Slide 19: Delivering our strategy to win
Delivering our strategy to win Accelerate growth through differentiated steering of BSP and BES to leverage innovation and global reach — Hardwire excellence to sustain market outperformance Easiest to do business with Be a frontrunner in Digital & Data to connect supply partners and customers 3 . A
Slide 20: Horizon leads to BSP and BES with specific strategies
Horizon 2 leads to BSP and BES with specific strategies, differentiated core capabilities and shifting operating models Differentiated core capabilities Shifts in operating model post 2022 20 LS Global go-to service partner —__—— = Value-added services = Innovation and application development = Comp
Slide 21: Brenntag to become the data- and tech-driven industry leader
Ll Brenntag to become the data- and tech- NSA. driven industry leader with strong focus ae — on operational excellence Becoming easiest to do business with Unlocking the value from our data Creating a scalable technology platform Building capabilities to attract and retain talent Driving value deliv
Slide 22: Leading the creation of a sustainable ecosystem across the industry
Leading the creation of a sustainable ecosystem across the industry Circularit Sustainable Ircularity product Selected mid- to long-term targets portfolio 100% green energy by 2025 and net zero by 2045 Clean tech ° 100% portfolio steering towards Suppliers Customers sustainability by 2025 Supply cha
Slide 23: Brenntag achieves industry leading sustainability ratings
Brenntag achieves industry leading sustainability ratings SMBS. (OS rocetHER @Yithe a OE cues nembersnos @ YP Oo Vie EK © AB andinitiatives “<< StaNbaros TARGETS Responsible “Together for jon i a a nm UN Global ane paalnee Global inclusion initiative DAX 60 DAXESG Reporting Reporting according Joine
Slide 24: Unique carbon management program with an internal CO2 price
Unique carbon management program with an internal CO, price will steer the organization towards “net zero” by 2045 SO o™ GHG emissions tracking Annual comparison against desired reduction path Corporate Carbon Management Program Sos Implementation support Financial support for new projects to reduce
Slide 25: Accelerate industry consolidation through focused M&A
Accelerate industry consolidation through focused M&A Brenntag is #1 consolidator in the industry with > 30 deals in the past 5 years” Our M&A principles Brenntag Specialties Brenntag Essentials Financial discipline ic EMEA Chomicats Accelerate growth in BSP division Fill white spots and strengthen
Slide 26: Our mid-term targets will deliver industry outperformance
Our mid-term targets will deliver industry outperformance Organic Gross Profit growth Organic Operating EBITA growth DiDEX improvement programme Planned M&A investments Note: Base year for targetsis 2021 26 Excluding benefits from DiDEX Group Organic Operating Gross Profit CAGR® 4- 6% BSP 6-8% BES 3
Slide 27: Digital.Data.Excellence.
Digital.Data.Excellence. Delivering EUR 200m net annual EBITA uplift by 2026
Slide 28: Brenntag digitally connects the industry ecosystem
17,200 Employees 180,000 Customers Several 1,000s Supply partners Service and innovation partners Technology partners 13,500,000+ Transactions 28 Brenntag digitally connects the industry ecosystem Key connectors Unrivalled access to transactional data Most extensive supply chain connecting for susta
Slide 29: Customers and supply partners at the heart of everything we do
Customers and supply partners at the heart of everything what we do... ... and our data at the core of how we do it to become a true data-driven company Seamlessly connect with our supply partners Be the best place and other ecosystem to work for our employees participants Be the easiest to do busin
Slide 30: Digital.Data.Excellence.
Digital.Data.Excellence. Becoming easiest Unlocking value Creating a scalable to do business with from our data technology platform Excellence through harmonized, Modular architecture, cloud first, industry-leading processes Data- and Al-driven real-time API first, and security-embedded and omnichan
Slide 31: Becoming the easiest to do business with
Becoming the easiest to do business with - While running the most efficient supply chain Omni-channel_ J Transparent Joint customer and and connected § application fe) supply partner [| supply chain development ~ 9 @) % engagement Active users growth of Brenntag Connect” Excellence program swe Estab
Slide 32: Unlocking the value from our data
Unlocking the value from our data Data-driven “Customer Growth Engine” predicts customer order cycles, increases insights stickiness, and delivers just-in-time — 2022 60% 600+ BBSRENNTAG. caster Gronth Engine TIDE SUCREFIN i G8 G8 |BEB 2023 >1im >95% 32 Achievements Footprint coverage by December 20
Slide 33: Unlocking the value from our data
Unlocking the value from our data Data-driven insights Data-driven decision making Global data platform Master data management 33 “Customer Growth Engine” predicts customer order cycles, increase stickiness, and delivers just-in-time Real-time dashboards, recommendation systems (pricing and demand)
Slide 34: Creating a scalable technology platform
Creating a scalable technology platform Past Future Customer and Monolithic, Supply Partner Leverage scale of Brenntag on-premise Platrorm Supply Chain Employee localERPs &> ecosystem platform 5 Easiest for partnersto a connect locally and globally 9 < o 8 3 Data platform Easier integration of 2 acq
Slide 35: Digital, data and process capabilities and talent
Digital, data and process capabilities and talent We build global capabilities to drive value continuously and sustainably Gd C4] Building up dedicated digital, datdana process capabilities <> Developing a cohort of 450+ certified black and green belts by 2026 to drive continuous improvement locally
Slide 36: Value delivery and change
Value delivery and change 36 Build on transformation experience = Business-ownedinitiatives with proven success as part of Project Brenntag * Value deliveryfrom the start through a portfolio of initiatives = Change management firmly embedded ) Add agile best practices = Think big, start small, scale
Slide 37: Benefit of DiDEX will result in net annual EBITA uplift of EUR 200m by 2026
Benefit of DiDEX will result in net annual EBITA uplift of EUR 200m by 2026 Substantial benefits ... ... enabled by 37 EUR 200m net annual EBITA uplift by 2026 - Continuous improvements thereafter 80% from bottom line measures 2 One-off spend over next 4 years EUR ~350m total investment until 2026 t
Slide 38: Brenntag Specialties
Brenntag Specialties Global go-to service partner
Slide 39: Brenntag Specialties: Global leader for innovative and sustainable solutions
Brenntag Specialties: Global leader for innovative and sustainable solutions EUR 1.3bn EUR 535m FY 2021 Op. Gross Profit FY 2021 Operating EBITA Trusted 1,000’s ~100k partner BSP suppliers BSP customers Innovation 81 >400 focus Application labs BSP operational sites globally 39
Slide 40: Enabled by distinct strengths
Enabled by distinct strengths + Ex eee o B Global network Strategic Data & Technical skills Brand of labs with VASY partnerships digital and . . operating Global excellence Global supplier and Well invested IT model and local expertise supply chain services, a global Visible and through capabilities
Slide 41: Operating in highly attractive end markets with a well diversified portfolio
Operating in highly attractive end markets with a well diversified portfolio Segment Attractiveness!) Growth potential % Op. Gross Profit FY212) Food | Market leading Specialties PerscnalCro portfolio diversified across We ° | key end markets Sdieaece Pharma > GDP +++ 55% HI&l | AnimatNutrition High
Slide 42: Global network of application labs to deliver value-added solutions
Global network of application labs to deliver value-added solutions Application labs by end market Lubricants Material Science Life Sciences 5% Environmental Science Application labs by geographical coverage Americas EMEA Asia 81 laboratories Diversified across BSP end industries Global collaboratio
Slide 43: Strategically partnering with suppliers and customers in a solutions ecosystem
Strategically partnering with suppliers and customers ina solutions ecosystem Externalinnovation partners?) Comprehensive portfolio of >35k o> products from leading suppliers Ca GB Customer and Value added a supplier support services B BRENNTAG Deep understanding of markets, products and consumer tr
Slide 44: Specialties distribution market is in continued evolution
Specialties distribution market is in continued evolution Focused specialties and Growing demand for Increasing complexity of Opportunity to ingredient principals innovation, value-added specialties markets and leverage digitalization require distributors with services and technical strategic partne
Slide 45: BSP strategic priorities to achieve our ambition
BSP strategic priorities to achieve our ambition Strategic ambition Be the global go-to-service partner for innovative and sustainable products Increase Offer the most Expand global Develop with value-added comprehensive footprint high-growth Strategic service and sustainable customers priorities of
Slide 46: Increase value-added service offerings
Increase value-added service offerings Co-develop with global and local customers to improve product performance and support on mixing & blending Introduce new formulationsto the market Enhance innovation capabilities and specialized customer support Open new application labs and leverage experience
Slide 47: Food case study: New product developments in Vietnam
Food case study: New product developments in Vietnam A new entrantin the food industry was looking for a partner to Challenge launch a series of new products Brenntag capability Customer bought full formulation for energy drink, milk plus juice and functionalingredients for coffee 3 in 1
Slide 48: Global leader offering high-level added services to the Pharma ecosystem
Global leader offering high-level added services to the Pharma ecosystem Unique Brenntag will be the only player to cover the widest number of relevant services in the Pharma ecosystem Global Providing a higher level of specialisation and global connectivity to our partners Value-added World-leading
Slide 49: Offer the most comprehensive and sustainable portfolio
Offer the most comprehensive and sustainable portfolio with strategic supplier partnerships Enhance industry leading portfolio by filling product white spots through strategic supplier partnerships Reinforce strategies to increase share of sustainable product and services Collaboration with customer
Slide 50: Personal Care case study: Sensory assessment to move away from microplastics
Personal Care case study: Sensory assessment as a valuable tool to move away from microplastics Market moving away from microplastics in personal care Challenge products ahead of regulated enforcement, but need to find equivalent sensory profiles without losing quality [| Sensory assessment testing
Slide 51: Expand global footprint
3 Expand global footprint SELECTED EXAMPLES = Expand Solutions value-added services = Establish HUB setup and global services business for Food for Pharma = Expand sites to include GMP capabilities = Accelerate growthin Personal Care for Pharma "Expand Foodin Middle East and Africa LATAM APAC = Acce
Slide 52: Develop with high-growth customers and industries
, Develop with high-growth ~~ 4. customers and industries Life Sciences Material Science Environmental Science Food: Strengthen leadership position by focusing on fast growing food segments Personal Care: Develop in fast growing segments Skin & Face Care Pharma: Grow in traditional Pharma, Biopharma
Slide 53: Accelerate M&A
53 5 Accelerate M&A Accelerate M&A to support growth strategy Add scalable capabilities with high-growth potential Accelerate market entry Increase presence in APAC across all segments M&A approach Life Sciences Material Science Environmental Science Lubricants Segment EMEA North America LatinAmeric
Slide 54: Be the global specialties go-to-service partner
Be the global specialties go-to-service partner for innovative and sustainable solutions PD BRENNTAG Ys BRENNTAGS Increase Offer the most value-added comprehensive service and sustainable «alti, + . . ..to a global specialties partner From a leader in offering portfolio leading in Life and Material
Slide 55: Brenntag Specialties: Sustainably delivering above market growth
Brenntag Specialties: Sustainably delivering above market growth Medium term targets Expanding into high growth regions I | | and optimizing our portfolio and e 16) . . solutions capabilities rganic Operating Of, _ QO Gross Profit CAGRY 6% - 8% 7\ Above market growth in Gross | Profit is complemente
Slide 56: Brenntag Essentials
Brenntag Essentials Local strength, global expertise, reliable partner
Slide 57: Brenntag Essentials: Unique connector of last mile delivery reach
Brenntag Essentials: Unique connector of last mile delivery reach with global supply chain expertise EUR 2.1bn EUR 620m Market leader FY 2021 Op. Gross Profit FY 2021 Operating EBITA Local strength ~150k ~600 Customers Sites > Global expertise 1,000s 70 Suppliers Countries 87
Slide 58: Highly diversified geographic, industry and product spread
Highly diversified geographic, industry and product spread make the Essentials business resilient Op. Gross Profit (EUR m, 2021) Various APAC manufacturing Energy Acids vert Si ji erformance 7 envices Materials North America Energy N Chemical Services < Processing Other end -—— 150k markets | —_— >5
Slide 59: BES has unrivalled foundational strengths
BES has unrivalled foundational strengths resulting in a clear competitive advantage... Unique local and regional distribution network, deeply embedded in high demand centers around the world Global sourcing of Superior “last mile” Professional and Strong geographic, Industry leading service excelle
Slide 60: A broad set of capabilities that support resilience and reliability
..and a broad set of capabilities that support resilience, reliability and create value 60 Less than truckload Multiple stocking locations, supply chain services, including tank storage, break bulk, packaging, truck fleet, LTL” deliveries Mixing & blending with technical knowledge and services Effec
Slide 61: Key strategic priorities to achieve accelerated, above market growth
Key strategic priorities to achieve accelerated, above market growth and strong cash conversion 61 Strategic ambition Strengthen localand regional distribution networksin under- represented areas (i.e. NA, LA, APAC) Strategic priorities accelerated above market growth with strong cash conversion Opt
Slide 62: Local strength: Further strengthen local and regional distribution networks
Local strength: Further strengthen local and regional distribution networks Further strengthen local and regional distribution networks New North America rail-connected facilities in Boston, Pittsburgh and = Invest in new facilities in Toledo- Ohio while improving logistics efficiencies geographic ‘
Slide 63: Local strength: Invest in last mile delivery capabilities
1 Local strength: Invest in Last mile delivery capabilities and service excellence Enhanee Service Excellence Pam | « Implement digital tools like “Track Track & Trace for inbound and outbound logistics, enhancing customer loyalty & Trace”, instant availability conformation, pricing and order | plac
Slide 64: Global sourcing expertise: Expand terminal capabilities in strategic ports
oD Global sourcing expertise: Expand terminal capabilities in strategic ports to enhance global product flows Strengthen global platform via Eeomnle terminal capabilities in strategic ports P New tollgates, similar to Brenntag Rotterdam, to be established in key strategic locations globally to conne
Slide 65: Global sourcing expertise: Enhance security of supply
Global sourcing expertise: Enhance security of supply and competitiveness into regional networks - the most reliable partner Enhance global sourcing to connect to regional networks 65 = Establish global sourcing team and market intel capabilities to improve security of supply and capture competitive
Slide 66: Growth markets: Capture new market potential via M&A
66 Growth markets: Capture new market potential via M&A and targeted investment Capture new market pote: M&A and targeted investments Example: im upgrade Establishing terminal, packaging and blending capabilitiesin Vietnam to upgrade products and services and gain market share Capture new market pot
Slide 67: Growth markets: Be the market leader for sustainable products
Growth markets: Be the market leader for sustainable products and solutions Be the market leader for sustainable A Example: Sust in practice products and solutions un wa = Offer the broadest base of bio- = Already reducing carbon braless based and renewable products footprint via alternative Le] to
Slide 68: Embedding DiDEX across BES to enable effective strategy execution
Embedding DiDEX across BES to enable effective strategy execution Scenario DiDEXimplementation Smaller customers place Predictive demand analytics infrequent orders with short and algorithmic pricing tools lead times prompt proactive customer Local contact to stimulate sales strength Brenntag captur
Slide 69: Connecting local strengths with global scale and expertise
Connecting local strengths with global scale and expertise BRENNTAG aa , ed Froma regional leader in the Americas and EMEA... 69 Local Efficientinland supply networks and service excellence G Interregional productflows andtollgates lobal Global sourcing and supplier management ew . Achieving acceler
Slide 70: Brenntag Essentials: Industry leading growth, profitability and cash generation
Brenntag Essentials: Industry leading growth, profitability and cash generation Medium term targets I Sustainable Gross Profit and EBITA l | growth Organic Operating {o) fo) Gross Profit CAGR 3% - 4% focusing on profitability | 7\ Product portfolio optimization Organic Operating O_O Improved inland
Slide 71: Financial framework and M&A ambitions
Financial framework and M&A ambitions
Slide 72: Resilient service and distribution platform with high diversification
Resilient service and distribution platform with high geographical and operational diversification Brenntag Group Brenntag Group Several thousands ~ 180,000 > 10,000 Operating Gross Profit 2021. Operating Gross Profit 2021. Various APAC manufacturing ee - x Top 10” Top 102) Top 10% Aerobusioss RE g
Slide 73: Sustainable track record of compounding growth
Sustainable track record of compounding growth Operating EBITA inEURm Profit growth consistently above chemicals CAGR ~7.0% as | manufacturing growth 1,082 IPO Ability to protect margins even in macro downturns 754 758 699 695 Operating EBITA margin remains stable across cycle Countercyclical cash f
Slide 74: Transition to EBITA as lead KPI
Transition to EBITA as lead KPI to appropriately reflect profitability Group FY21 ; ; More accurate for 39.8% Alignment with internal performance key peers disclosure comparison between EBITDA BSP and BES Conversion Ratio” BSP wi 32.0% h ah igher EBITA Balancing service fees Fully reflects vs. depre
Slide 75: Group financial 2026 targets at a glance
Group financial 2026 targets at a glance Digital.Data.Excellence / Growth and profitability Self-help program Planned investments 4% - 6% Organic Operating Gross Profit CAGR 6% - 8% EUR 200m Organic Operating EBITA CAGR Net annual EBITA uplift by 2026 35% - 37% Operating EBITA Conversion Ratio” Note
Slide 76: BSP will surpass BES in size by 2026
BSP will surpass BES in size by 2026 Brenntag Specialties Brenntag Essentials Organic Operating Gross Profit senate 6% - 8% 3% - 4% Organic Operating EBITA CAGR Th -I9% 4% - 5% Operating EBITA Conversion Ratio ae) 40% - 42% 28% - 30% Base year for targets is 2021 76 "Calculated as Op. EBITA / Gross
Slide 77: Benefit of DiDEX will result in net annual EBITA uplift of EUR 200m by 2026
Benefit of DiDEX will result in net annual EBITA uplift of EUR 200m by 2026 Programis already delivering benefits ILLUSTRATIVE EUR 200m 80% Net annual EBITA uplift by From bottom line 2026 measures Benefits ~65% EUR ~350m OPEX Total investment until Costs 2026 to develop Digital & Data capabilities”
Slide 78: Strong financial profile provides room for further profitable investments
Strong financial profile provides room for further profitable investments 1.3x Leverage Current Net Leverage”) 40% Equity Ratio Current Equity Ratio?) 23% Current ROCE®”) YLTM Q32022 Leverage calculated as Q3 Net Debt divided by LTM Q8 2022 Operating EBITDA 2LTM Q8 2022 Equity Ratio calculated as Q3
Slide 79: Brenntag is the leading consolidator in the industry
Brenntag is the leading consolidator in the industry M&A activity 2017-2022 YTD”... ... with compounding value creation over time Number of deals EUR o @e @ @ t 2) @ ba. 4.7bn Acquired revenue 2010 - 2022 YTD” Average share of M&A contribution ~3% to annual Op. EBITDA from 2010 - 2022 YTDY EUR M&A s
Slide 80: Clear M&A strategy as an enabler of future growth
Clear M&A strategy as an enabler of future growth Key pillars of growth... translating into strategic plans Accelerate growth in Life Sciences globally Continued financial and integration discipline Enhance strategic capabilities and market positions Expand position in emerging marketsin Specialties
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