Kordsa Teknik Tekstil A.s. · BIST:KORDS
Kordsa Teknik Tekstil A.s — Investor Presentation (November 2021)
28 slides from Kordsa Teknik Tekstil A.s's investor presentation, November 2021
Slide 1: Investor Presentation
Kordsa.com Investor Presentation Nov, 2021
Slide 2: Disclaimer
Disclaimer The information and opinions contained in this document have been compiled by KORDSA Teknik Tekstil Anonim Şirketi (the “Company”) from sources believed to be reliable and in good faith, but no representation or warranty, expressed or implied, is made as to their accuracy, completeness or
Slide 3: Who we are
Who we are 4 continents ~4,500 2 R&D 995 patent applications 12 facilities continents center 191 patents WE REINFORCE LIFE 3
Slide 4: Agenda
AGENDA 01. 02. 03. Kordsa Story Sustainability Operations 04. 05. 06. Financial Highlights & Why Invest in Performance Lowlights Kordsa? 4
Slide 5: Our target is the continuation of market leadership in tire reinforcement
5 Our target is the continuation of market leadership in tire reinforcement, growth in Composite segment especially in Europe and actualization of transformation to advanced material company 1. Phase 2. Phase 3. Phase 4. Phase 5. Phase 6 Phase 7. Phase Transformation to Growth with JV Being a global
Slide 6: Kordsa Priorities
6 KORDSA PRIORITIES Business Excellence 1. • Operational Excellence: Safe and reliable operations, competitive cost • Digital Transformation: Data analytics and Artificial Intelligence, Robotics and Automations, Cybersecurity • Effective Finance & Risk Management • Commercial Excellence Growth 2. •
Slide 7: Kordsa Investment Highlights
7 Kordsa Investment Highlights 01. 02. 03. Strong hedge position to Global footprint with Growth in composite country risks through %100 large presence at reinforcement hard-currency revenue growing regions market 04. 05. Strong ESG position Strong cash generation and dividend payout
Slide 8: Inspired to Reinforce Life for a Better Today and Tomorrow
8 Passion for Business Responsibility for Excellence People Efficiency and improvements We commit to a in our own operations to non-discriminative, safe and Inspired to Reinforce Life create a positive impact in our value chain and to healthy working environment for all. accelarete low carbon for a
Slide 9: Kordsa Sustainability Targets and Awards & Recognition
9 Kordsa Sustainability Targets Kordsa Awards & Recognition 2020 CDP Turkey Climate 2030 Change and Water Leader 30% Emission Reduction Ecovadis Gold Medal 2030 2030 Entered Istanbul Stock Exhance 50% water withdrawal 50% total waste reduction per unit reduction per tonnage Sustainability Index for
Slide 10: Industrials / Solid Positions: Operations, Financials
10 Industrials / Solid Positions OPERATIONS FINANCIALS
Slide 11: Global Footprint and Kordsa Market Position
11 Global Footprint NORTH AMERICA Kordsa Market Position 5% -27% vs. 2020 vs. 2019 EMEA #1 NY TCF producer #1 PET TCF producer Anaheim, CA İstanbul İzmit Quakertown, PA NA Santa Ana, CA Laurel Hill, NC San Marcos, CA Chattanooga, TN #1 NY TCF producer in US Thailand Indonesia SA Brazil Composite Bra
Slide 12: Segment Reporting
12 Segment Reporting Sep, 21 Revenue Split Sep, 20 Revenue Split By Region By Product By Region By Product Other; Other; Composite; 2% 2% Asia; Composite; Asia; 10% 23% EMEA; 17% 28% EMEA; 31% 34% SA; 12% SA; 12% TCF & Yarn; NA; TCF & Yarn; NA; 81% 26% 88% 35%
Slide 13: Tire Cord Fabric Value Chain
13 Tire Cord Fabric Value Chain MANUFACTURING PROCESS RAW MATERIALS NY66 and PET HMLS Dipped Yarns Fabric Polymersiation Chemical Twisting and and Yarn Greige Treatment Weaving Spinning Fabric (dipping) Oil derivative Chemicals and Polymers Integrated Higher value HMD production can Adipic Acid adde
Slide 14: Where do our products go…
14 GROOVE Where do our products go… RIB CAP PLIES • A tire is a highly complex composite with approx. 40 components working under dynamic conditions enduring heat and motion SIPE • NY66 typically used in cap plies RADIAL PLIES • PET typically used in radial plies • By weight: • By value => Approx 7-
Slide 15: Market Dynamics / Tire
15 Market Dynamics / Tire Global Automotive Market (million units) Global Tire Maraket (million units) 74.6 92.8 95.7 99.0 1,661 1,759 1,825 1,877 88.7 83.1 1,701 1,504 3,5 3,7 69,0 3,2 63,0 67,0 3,3 2,8 61,0 57,0 11,7% 16,9 17,0 5,8% 204,0 3,8% 204,0 3,8% 206,0 16,2 -15,9% 2,2 11,4% 17,1 3,1% 199,0
Slide 16: Composite Value Chain
16 Composite Value Chain INTERMEDIATES RAW MATERIALS Prepreg Weaving Fibers: Value added The sole supplier products comprised Carbon Fiber by ceramic, carbon, Aramide of B787 Dreamliner aramid, glass for Glass Fiber various industries Ceramic Fiber such as aerospace, Kevlar energy, automotive, sport
Slide 17: Composite Value Chain
17 Composite Value Chain • Composites use in aerospace & automotive is increasing, due to improved material properties and weight savings over conventional materials • «Lightweighting» is a major theme, driven by emission regulations as well as fuel-efficiency needs COMPOSITE PARTS
Slide 18: Market Drivers / Composite
18 Market Drivers / Composite Global Prepred Market (‘000 USD) Global Carbon Fabric Market (‘000 USD) 1.401 1.316 4.998 5.169 1.234 1.185 1.173 6,6% 4.565 13,2% 1.100 5,2% 16,6% 3.764 4,0% 3.916 7,7% -32,8% 12,1% -21,5% -1,0% 3.359 2019 2020 2021E 2022F 2023F 2024F 2019 2020 2021E 2022F 2023F 2024F
Slide 19: Construction Value Chain
19 Construction Value Chain MANUFACTURING PROCESS RAW MATERIALS Cutting NY66 and PP Fibers Twisting Dipping Pucking Polypropylene and nylon 66 Higher value polymers added from dipped fabric Kordsa’s Kratos Fiber Reinforcement are applied in Superstructure & Infrastructure Solutions
Slide 20: Composite Value Chain: Major Applications
20 Composite Value Chain MAJOR APPLICATIONS REINFORCED • Infrastructure projects (tunnels, CONCRETE runways, dams, bridges, metro STRUCTURES tracks, highways) • Mines
Slide 21: Industrials / for the Future of Mobility: Operations, Financials
21 Industrials / for the Future of Mobility OPERATIONS FINANCIALS
Slide 22: Revenue, EBITDA and Net Income
22 REVENUE EBITDA MARGIN 5,190 16.6% MTL Up 68% y-o-y strong margin 861 MTL NET INCOME REVENUE COST BREAKDOWN BREAKDOWN 558 100% 82% Hard USD MTL Currency Based 5,5x times increase 78% USD-Based 82% USD-Based 22% EUR-Based 18% EM Currency
Slide 23: Kordsa Income Statement Sep'21
23 Kordsa Income Statement Sep’21 TL Financials (MTL) Sep'21 Sep'20 D 3Q'21 3Q'20 D Sales 5.190 3.086 68,2% 1.987 1.079 84,1% Gross Profit 1.169 509 129,9% 432 147 194,5% Gross Margin (%) 22,5% 16,5% 7 pts' 21,7% 13,6% 8 pts' OPEX (%) 10,6% 11,4% 0 pts' 10,7% 11,2% 0 pts' Operating Profit 789 264 19
Slide 24: 3Q 2021 Snapshot
24 3Q 2021 Snapshot RESULTS DRIVERS • Strong tire reinforcement demand driving prices up USD-Based Revenue 55.7% • Kordsa volume growth above market growth Growth • Price increases as a result of ingredients price hikes (vs 3Q’20) • Doubled revenue generation from construction (7.0M$) • Volume gwort
Slide 25: Well-Positioned for Strong Cash Generation and Dividends
25 Well-Positioned for Strong Cash Generation and Dividends FX exposure • Demonstrates value-based pricing model 6% 1% 22% 4% • Ability to pass through raw material price volatility: 7% (Revenue – raw material costs) tracked as a KPI by sales team Revenue Costs • Conversion costs as a key metric for
Slide 26: Well-Positioned for Strong Cash Generation
26 Well-Positioned for Strong Cash Generation Average Working Capital Turnover Net Debt / EBITDA -1.4pp 35,8% 4,1 4,0 34,7% 3,3 33,8% 2,7 32,8% 2,3 32,4% 3Q'20 4Q'20 1Q'21 2Q'21 3Q'21 3Q'20 4Q'20 1Q'21 2Q'21 3Q'21 Amount Avg. Int. Rates INVENTORIES DOWN 20% Y-O-Y Driven by strong demand in tire and
Slide 27: Kordsa's Financial Policy
27 Kordsa's Financial Policy Our company guidance for financial EBITDA MARGINS year 2021 is as follows: Kordsa is targeting progressive improvement in EBITDA margins over the medium term Revenue DIVIDEND POLICY Distribution of all the distributable profits which is lower of the 50% - 55% 30% - 35% K
Slide 28: Thank You
Thank You THE REINFORGER
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