Slide 1: Third Quarter Earnings Presentation
THIRD QUARTER Earnings Presentation 20 October 2022
Slide 2: Improved earnings and cash flow despite challenges in the third quarter
Improved earnings and cash flow despite challenges in the third quarter ○ Stable sales volume of 120 ktonnes (119) – Continued strong demand in Americas – Strong post-covid recovery in China – Significant slowdown in Europe ○ Increased adjusted operating profit of SEK 345 million (219) – Continued m
Slide 3: Stable sales volume – growth in Automotive fuelled by strong recovery in China
Stable sales volume – growth in Automotive fuelled by strong recovery in China Q3 2022 sales volume growth by business area and end-customer market Gränges Americas Gränges Eurasia Gränges Group HVAC +5% Automotive +18% Automotive +12% Speciality Other packaging -7% niches -27% HVAC +5% Other Specia
Slide 4: Continued year-over-year margin improvement – Europe impacted by slowing demand and increasing energy cost
Continued year-over-year margin improvement – Europe impacted by slowing demand and increasing energy cost Sales volume and Adjusted operating profit per tonne 120 5.0 Adjusted operating profit per tonne (kSEK) 4.0 100 2.7 2.9 2.5 Sales volume (ktonnes) 1.8 80 1.4 1.1 60 0.0 40 -2.5 20 64 61 57 59 6
Slide 5: Continued good sustainability performance
Continued good sustainability performance Carbon emissions intensity1 ○ Commitment to climate neutrality by 11.4 +7% 12 2040 and to Science Based Targets 8.9 9.3 9.0 9.5 initiative tCO2e/tonne 7.9 8 4 ○ New long-term partnership for delivery of Scope 1+2 Scope 3 renewable energy to Newport site 0 Ba
Slide 6: Good progress for battery materials for electric vehicles
Good progress for battery materials for electric vehicles ○ High customer interest in Gränges’ cathode foil and other components for electric vehicle batteries ○ Gränges has structural advantages: footprint, technology, sustainability ○ Systematic investment program with first deliveries in China in
Slide 7: Financial overview – third quarter 2022
Financial overview – third quarter 2022 SEK million Q3 January - September 2022 2021 Change 2022 2021 Change Sales volume (ktonnes) 119.8 118.5 1.1% 369.0 376.6 -2.0% Net sales 6,172 4,621 34% 19,126 13,272 44% Adjusted operating profit1 345 219 58% 1,077 870 24% Adjusted operating profit per tonne
Slide 8: Stable net debt and improved leverage in third quarter
Stable net debt and improved leverage in third quarter Change in financial net debt -2 000 2.3x Adjusted cash flow before financing 2.1x -2 500 SEK 441 million -3 000 SEK million -3 500 -4 000 -76 -4 -89 -129 -4 500 -4 396 610 -258 -4 342 -5 000 Financial Adjusted Items Other operating Maintenance E
Slide 9: Gränges Americas – third quarter 2022
Gränges Americas – third quarter 2022 Sales volume ○ Stable sales volume 80 ±0% – Continued strong market conditions 60 except in Automotive ktonnes 40 – Gradual ramp-up of Salisbury facility 20 restricted production capacity 64 57 64 64 63 0 Q3 Q4 Q1 Q2 Q3 Adjusted operating profit ○ Increased oper
Slide 10: Gränges Eurasia – third quarter 2022
Gränges Eurasia – third quarter 2022 Sales volume ○ Asia sales volume increased by 32% 80 +2% – Strong China post-COVID recovery 60 ktonnes 40 ○ Europe sales volume decreased by -12% 20 – Slowing demand in many end- 0 61 59 68 66 62 customer markets Q3 Q4 Q1 Q2 Q3 – High customer inventory levels du
Slide 11: Positive development towards new targets in third quarter
Positive development towards new targets in third quarter Profitability Profit growth Capital structure Dividend 20% 30% 3 50% 20% 40% 15% 2 10% 30% 10% 0% 20% 1 5% -10% 10% 0% -20% 0 0% 2014 2022 2014 2022 2014 2022 2014 2021 Return on capital Average operating Financial net debt Dividend as per ce
Slide 12: Outlook – fourth quarter 2022
Outlook – fourth quarter 2022 ○ Short-term macro environment and market outlook remain highly uncertain ○ Sales volume for fourth quarter currently expected to be stable year over year – Good demand in Americas and Asia – Weak demand in Europe outside of Automotive ○ Time lag for passing on high Eur
Slide 13: Summary: good progress on many fronts
Summary: good progress on many fronts ○ Another quarter proving stability and flexibility in very turbulent external conditions ○ Year to date – Highest-ever operating profit – Lowest-ever carbon intensity and highest-ever recycling ○ Strong interest in battery products and good progress on Navigate
Slide 14: Q&A
Q&A Jörgen Rosengren, CEO Oskar Hellström, CFO
Slide 15: Slide 15