Slide 1: FY 2018 results
FY 2018 results March 21, 2019 2019 LONG-TERM INVESTOR 1 2018 Annual Results | Mar. 21, 2019
Slide 2: Last twelve months key achievements
Last twelve months key achievements €1.5bn disposals(1) crystalizing c. €720m value accounting gains(2) €141m reinvested in portfolio companies Strong corporate financial structure with net debt at Wendel near zero(1) Stronger & simplified portfolio: 7 companies vs 13 in January 2018 More solid basi
Slide 3: FY 2018 key figures
FY 2018 key figures NAV as of December 31, 2018: • €147.4 per share LTV ratio @ 6.1% and net debt of €0.4bn Consolidated sales of €8.4bn, up +3.9%, most companies posting organic growth Consolidated net income of €280.4m, €45.3m Group share 3 2018 Annual Results | Mar. 21, 2019
Slide 4: Dividend & share buyback
Dividend & share buyback Return to shareholders • Launch of a €200m share buyback(1) • €2.80 per share proposed dividend, up +5.7% (1) Wendel announces that it intends to enter into a €200 million share repurchase agreement with Goldman Sachs International (“Goldman Sachs”) to be started once Wendel
Slide 5: Performance of Group companies
Performance of Group companies FY 2018 5 2018 Annual Results | Mar. 21, 2019
Slide 6: Bureau Veritas
Bureau Veritas Revenue of €4.8bn, up 2.3% year-on-year, with organic growth of +4.0% H2 acceleration achieved with +4.4% organic growth in the last quarter 6 acquisitions in 2018, focused on Group’s Strategic Growth Initiatives Adj. operating profit of €758m, up +1.7% and up +8,4% at constan
Slide 7: Refocusing portfolio (1/2)
Refocusing portfolio (1/2) 2018: ~€1 billion Closed disposal of 4 unlisted portfolio companies: total net proceeds of €600 million Bureau Veritas block sale: €400 million 2019: ~€480 million Partial sale of Allied Universal Disposal of PlaYce Dribble out of Saint-Gobain shares since January for €143
Slide 8: Refocusing portfolio (2/2)
Refocusing portfolio (2/2) 4 small size assets disposed at attractive valuations and exceeding NAV Net IRR: 14.3% Coc : x1.5 Net IRR: 6% Net IRR: -5% +79% 296 Coc : x1.3 Coc : x0.9 Net IRR: 29% Coc : x3.6 +1% +93% 175 +18% 129 130 85 85 72 44 Nippon Oil Pump Saham Mecatherm CSP Technologies Value in
Slide 9: 2018 performance of Group's main unlisted companies
2018 performance of Group’s main unlisted companies Organic EBITDA Margin Sales Δ growth EBIT for IHS IHS $1,168.1m +5.5% +20.0% $248.3m 21.3% Stahl €866.9m +18.2% +2.4% €196.8m 22.7% Constantia Flexibles €1,538.3m +3.4% +1.7% €186.1m 12.1% Allied Universal $5,828.0m +9.9% +3.3% $422.7m 7.3% Tsebo $
Slide 10: IHS Towers
IHS Towers Strong organic growth offset by new FX conversion rate in Nigeria +20% organic growth driven by the increase of owned & MLL towers (+4.4%) and price escalation mechanisms +5.5% reported growth due to conversion of Nigerian revenues at NAFEX rate in 2018 (c. 360 NGN for 1 USD) vs. CBN
Slide 11: Stahl
Stahl +18.2% sales growth driven by external & organic growth + 2.4% organic growth thanks to Performance Coatings. Confirmed more challenging market conditions in H2. (0.8% in H2 vs 4.2% in H1) + 19.4% external growth from FY consolidation of BASF Leather Chemicals - 3.6% currency impact EB
Slide 12: Constantia Flexibles
Constantia Flexibles +3.4% total growth: (+1.7% organic growth, +4.4% scope, -1.6% FX impact and -1.1% IFRS 15 impact) Slower growth in H2 (+0.4% vs +3.0% in H1) despite positive price/mix effect Creative Polypack Ltd. (India) acquisition closed in April 2018 (€62.8 million YTD sales impact for
Slide 13: Allied Universal
Allied Universal +9.9% total growth, due to a combination of acquisitions and organic growth Organic growth of +3.3% Acquisition in February 2018 of Covenant Security, full-year impact of 2017 acquisitions and consolidation of USSA since November 2018 EBITDA up +11.8% with growing margin Reven
Slide 14: Tsebo
Tsebo Good revenue growth of +9.7% Organic growth (+7.5%) driven by Cleaning and Facilities Management businesses Positive scope change (+1.8%) with acquisition of Rapid FM (2017) in Nigeria & Servcor in Zimbabwe (2018) Stable FX impact (+0.4%) EBITDA(1) up +5.4% Margin down -30bps as a resu
Slide 15: Cromology
Cromology -5.6% total decline in sales due to underperformance in France and Italy -3.4% organic decline mainly resulting from weak markets in France (DIY in particular) and Italy, combined with a significant salesforce churn Paint price increases (+2.9%) have been successfully implemented, but
Slide 16: Our portfolio benefits from balanced exposure to geographies, sectors, listed & unlisted assets
Our portfolio benefits from balanced exposure to geographies, sectors, listed & unlisted … % OF GROSS ASSET VALUE SECTOR EXPOSURE (1) GEOGRAPHIC EXPOSURE (1) Telecom & Energy Infrastructure 10% Africa & other 17% North America Industry 22% 24% 6% Health 4% Unlisted assets 43% Automotive & Government
Slide 17: Wendel financials FY 2018
Wendel financial s FY 2018 17 2018 Annual Results | Mar. 21, 2019
Slide 18: Key figures
Key figures Consolidated sales, in €m Net income from operations(1), in €m +3.9% +1.4% Organic +3.0% 512 8,389.2 505 Scope +4.8% 8,075.8 FX -3.7% IFRS 15 -0.3% 2017 2018 2017 2018 18 2018 Annual Results | Mar. 21, 2019 (1) Net income before goodwill allocation entries and non-recurring items
Slide 19: FY 2018 consolidated results
FY 2018 consolidated results in millions of euros 2017 2018 Contribution from subsidiaries 703.6 680,5 Financial & operating expenses and taxes -198.6 -168.4 Net income from operations (1) 505.0 512.1 2018: Doesn’t take into account the gain of €301.9 million Non-recurring income 142.7 -56.4 realize
Slide 20: Net Asset Value & Return to Shareholders
Net A sset Val ue & Return to Sharehol ders 20 2018 Annual Results | Mar. 21, 2019
Slide 21: NAV of €147.4 as of December 31, 2018
NAV of €147.4 as of December 31, 2018 (in millions of euros) Dec. 31, 2018 Listed equity investments Number of shares Share price(1) 3,268 • Bureau Veritas 156.3 million €18.2 2,846 • Saint-Gobain 14.2 million €29.8 422 Unlisted investments and Oranje-Nassau Développement(2) 3,908 Other assets and l
Slide 22: Net Asset Value bridge in 2018
Net Asset Value bridge in 2018 In millions of euros As per its valuation methodology, the following values have been retrospectively taken into account in the NAV calculation as of Bureau December 31, 2018: 8,158 Veritas • Allied Universal’s partial stake sale to CDPQ • Disposal of the stake in Play
Slide 23: Debt optimization at holding company level
Debt optimization at holding company level Net debt, m€ Improved LTV & Rating 1,163 12.2% Moody’s corporate credit rating : -65.0% Dec. 31, 2017 -610 bps Baa2/stable 442 Since September 5, 2018 6.1% ~0 S&P corporate credit rating : Dec. 31, 2018 BBB/stable Dec. 31, 2017 Dec. 31, 2018 Pro forma Since
Slide 24: Debt profile as of March 21, 2019
Debt profile as of March 21, 2019 +€750m undrawn credit 500 500 500 facility 10/23 Exch. Bond/0% Jul. 312019 Average cost of bond debt: 2.19% 300 300 Average maturity: 3.5 years 207 as of March 21, 2019 Sept. 17, 2019 5.875% 212 1.875% 3.75% 1.0% 2.75% 2.5% Apr. 10, 2020 Jan 21, 2021 2022 Apr. 20,20
Slide 25: ~€320 million to be returned to shareholders
Return to shareholders €2.80 proposed 553,576 shares Launch of a €200m bought back in 2018 dividend per share, share buyback in Q2 for a total amount of up +5.7% y-o-y €68.2m 2019 Annualized TSR since June 13, 2002 +11.3% ~€320(1) million to be returned +3.5% to shareholders Euro Stoxx 50 total net
Slide 26: Share Repurchase Agreement
Share Repurchase Agreement Following the large amount of proceeds from asset sales in 2018 & 2019, the very strong financial structure and the wide discount to NAV: Wendel intends to enter into a €200m share repurchase agreement To be started once Wendel-Participations SE, Wendel’s controlling share
Slide 27: Key takeaways
Key takeaways LONG-TERM INVESTOR 27 2018 Annual Results | Mar. 21, 2019
Slide 28: Supporting our main companies' consolidation strategy
Supporting our main companies’ consolidation strategy 6 acquisitions 2 acquisitions, of which U.S. Security Associates Wendel invested additional $78m equity in Allied Universal Acquisition of Creative Polypack in India Acquisition of Servcor in Zimbabwe and, more recently, Compass in Egypt 28 2018
Slide 29: 2018 in summary
2018 in summary Simplified Wendel’s portfolio taking advantage of a sellers’ market (7 companies instead of 13) Increased our focus on companies operating performance and strategic moves Streamlined our office footprint (Tokyo and Amsterdam closed, concentrated Singapore on portfolio support) Streng
Slide 30: What is next
What is next Focus on value creation opportunities across our portfolio Invest subject to attractive terms € Remain cautious on leverage Return value through €200 million share buyback(1) (1) Wendel announces that it intends to enter into a €200 million share repurchase agreement with Goldman Sachs
Slide 31: CSR is an opportunity for our portfolio companies
A win-win sustainable development policy CSR is an opportunity for our portfolio companies Competitive edge Operational excellence 31 2018 Annual Results | Mar. 21, 2019
Slide 32: Appendix
A ppendix 1 32 2018 Annual Results | Mar. 21, 2019
Slide 33: 2017-2020 main strategic pillars unchanged
2017-2020 main strategic pillars unchanged 2. DEVELOP & 1. INVEST CRYSTALLIZE VALUE Wendel may invest c.€750 million per Continue to ensure that portfolio annum (potentially along co-investors) companies develop with a long-term depending on markets conditions in DOUBLE-DIGIT TSR view: Europe, North
Slide 34: Appendix 2: Financial information as of Dec. 31, 2018
A ppendix 2 Financial information as of Dec. 31, 2018 34 2018 Annual Results | Mar. 21, 2019
Slide 35: FY 2018 consolidated sales
FY 2018 consolidated sales in millions of euros 2017 2018 Δ Organic Δ Bureau Veritas 4,689.4 4,795.5 +2.3% +4.0% Constantia Flexibles (2) 1,487.5 1,538.3 +3.4% +1.7% Cromology (3) 704.6 665.1 -5.6% -3.4% Stahl 733.3 866.9 +18.2% +2.4% Tsebo (4) 461.0 523.4 +13.5% +7.5% (5) Consolidated sales (1) 8,0
Slide 36: FY 2018 sales of companies accounted for by the equity method
FY 2018 sales of companies accounted for by the equity method (1) in millions of euros 2017 2018 Δ Organic Δ Allied Universal 4,704.0 4,937.4 +5.0% +3.3% IHS 982.2 989.6 +0.8% +20.0% (1) Following the disposal of PlaYce and in accordance with IFRS 5, the contribution of this portfolio company to 12M
Slide 37: Net income from operations
Net income from operations In millions of euros 2017 2018 Bureau Veritas 437.8 443.7 Stahl 84.0 110.3 Constantia Flexibles 82.9 83.2 Cromology 7.5 -5.2 Allied Universal (equity method) 11.9 11.9 Saint-Gobain (equity method until May 31, 2017) 40.7 - Saint-Gobain dividend 17.8 18.4 IHS (equity method
Slide 38: Consolidated income statement
Consolidated income statement In millions of euros 2017 2018 Net sales 8,075.8 8,389.2 Other income from operations 15.3 16.2 Operating expenses -7,372.5 -7,638.1 Net gain (loss) on sale of assets -3.6 -11.0 Asset impairment -23.1 -59.1 Other income and expenses -12.6 -21.2 Operating income 679.3 67
Slide 39: Consolidated balance sheet
Consolidated balance sheet In millions of euros 12/31/2018 12/31/2017 In millions of euros 12/31/2018 12/31/2017 Share capital 185.1 185.0 Goodwill 3,339.8 3,575.0 Premiums 50.9 48.7 Intangible assets, net 1,903.9 2,181.8 Retained earnings & other reserves 1,879.0 1,730.5 Property, plant & equipment
Slide 40: Conversion from accounting presentation to economic presentation
Conversion from accounting presentation to economic presentation Equity-method Wendel Bureau Constantia investments Group (in millions of euros) Cromology Stahl Tsebo Others holding Veritas Flexibles Allied total IHS companies Universal Net income from operations Net sales 4,795.5 1,538.3 665.1 866.
Slide 41: Bank and bond debt as of December 31, 2018
Bank and bond debt as of December 31, 2018 December 31, 2017 December 31, 2018 In millions of euros Nominal amount Maturity Nominal amount Maturity Bank debt related to Saint-Gobain - - - - Syndicated credit Undrawn Oct. 2022/€750m Undrawn Oct. 2023/€750m Wendel bond debt 2,870 2,519 350 April 2018
Slide 42: Financial agenda
Financial agenda 42 2018 Annual Results | Mar. 21, 2019
Slide 43: Financial agenda
Financial agenda 05/16/2019 2019 Annual General Meeting / Publication of NAV as of March 31, 2019, and Q1trading update (pre-market release) 07/30/2019 Q2 2019 / Publication of NAV as of June 30, 2019, and trading update (post-market release) 09/06/2019 2019 Half-Year consolidated financial statemen
Slide 44: Disclaimer
Disclaimer • This document has been prepared by Wendel S.E. (“Wendel”) solely for use at the 2018 annual results presentation, to be held on March 21, 2019. This document must be treated confidentially by attendees at such presentation and may not be reproduced or redistributed to any other person.
Slide 45: 2018 Annual Results | Mar. 21, 2019
45 2018 Annual Results | Mar. 21, 2019