Navigator Company Sa · EURONEXT:NVG
Navigator Company Sa — The Navigator Company — FY2023 Earnings Presentation
25 slides from Navigator Company Sa's earnings presentation, Feb 26, 2024
Slide 1: Results Presentation Q4/FY 2023
Results Presentation Q4/FY 2023 February 26th 2024
Slide 2: Disclaimer
DISCLAIMER This presentation is intended to provide a general overview of The Navigator Company S.A.’s business and does not purport to deal with all aspects and details regarding The Navigator Company S.A.. Accordingly, no representation, undertaking or warranty, expressed or implied, is given by T
Slide 3: Participation
PARTICIPATION António Redondo Fernando Araújo Nuno Santos Executive Directors João Lé Dorival Almeida António Quirino Soares Investor Ana Canha Relations 2
Slide 4: Q4/FY 2023 Results Presentation agenda
Q4/FY 2023 RESULTS PRESENTATION 01-Main Highlights 02-Market & Group Performance 03-New Business Opportunities 04-Outlook 33
Slide 5: 2023 Results: Delivering Results In Adverse Market Conditions
2023 | RESULTS Delivering Results In Adverse Market Conditions Second-best EBITDA result: €502 million, +14% vs. avg L5Y, 26% EBITDA margin (vs. 24% avg L5Y); Forest H1 2023 - challenging market environment, with pulp prices falling and UWF and Packaging weak apparent demand amplified due to stock d
Slide 6: 2023 - Agile Business Model: Proving Resilience
2023 - AGILE BUSINESS MODEL Proving Resilience EBITDA (M€) EBITDA Margin (%) Net Profit (M€) ▪ Business diversification through Tissue, operational flexibility, production adjustment and 736 30% 393 502 27% 26% 275 efficient commercial strategy 455 372 286 355 22% 21% 22% 225 168 109 171 2018 2019 2
Slide 7: FY 2023 Financial Highlights
FY 2023 FINANCIAL HIGHLIGHTS The second-best result in the company's history In millions € FY 2023 FY 2022 FY 23/FY 22 2018-22 FY 23/Avg L5Y ▪ Second-best EBITDA: € 502 million, 26% EBITDA margin. Turnover 1,953 2,465 -21% 1,765 +11% ▪ Second-best Turnover: €1,953 million. EBITDA 502 736 -32% 441 +1
Slide 8: Main Quarter Highlights
MAIN QUARTER HIGHLIGHTS Prices, cost control and business mix management allowed stable quarterly results in a volatile year Turnover (M €) EBITDA (M €) Operational Cash Flow (M €) ▪ Turnover - 493M€, +2% QoQ 650 680 642 223 207 501 478 481 493 184 171 476 492 151 151 131 122 124 125 103 100 97 110
Slide 9: EBITDA YoY Analysis
EBITDA YoY Analysis Downward trend on Pulp and UWF market prices, led by market deterioration. Decrease in paper volumes, partially offset by higher tissue and pulp sales. -235 M€ (-32%) 736 35 44 502 -16 -253 -12 -33 R22 A Price B Volume Logistics C Variable and FX Other R23 Fixed COST Downward tre
Slide 10: EBITDA Q4 23 vs. Q4 22 Analysis
EBITDA Q4 23 vs. Q4 22 Analysis Downward trend on market prices, led by market deterioration. Sharp cost reduction between 15%-20% in pulp and paper segments. -59 M€ (-32%) 184 125 -6 67 -3 15 -138 -5 R22 Q4 A Price B Volume Logistics C Variable and FX Other R23 Q4 Fixed COST Downward trend on marke
Slide 11: Q4/FY 2023 Results Presentation agenda
Q4/FY 2023 RESULTS PRESENTATION 01-Main Highlights 02-Market & Group Performance 03-New Business Opportunities 04-Outlook 10 10
Slide 12: Pulp & Paper Prices
PULP & PAPER PRICES European market paper price – A4 B-Copy and BHKP (€) 1460 PIX A4 COPY-B PIX BHKP EUROPE EUR 1380 1300 1220 ▪ BHKP pulp price index in Europe down 27% to 1,008 1140 USD/ton by the end of the year, currently at 1,141 1060 USD/ton1. Pulp price fell to their lowest level in August Eu
Slide 13: Pulp Market
PULP MARKET DEMAND Stocks Ports (kton) China Europe ▪ H1 with residual growth in demand for hardwood pulp (HW), leveraged by Europe avg. 19-23 China avg. 19-23 China (+21%) but offset in Europe (-21%) due to weak demand for end-uses. 2250 2000 ▪ H2 Chinese demand for hardwood pulp (HW) continued to
Slide 14: P&W Paper Market
P&W PAPER MARKET UWF MARKET CONDITIONS ▪ P&W global apparent demand down 11%, UWF paper continues to be the most resilient grade (-6%) vs. CWF paper (-18%) and mechanical (-19%). ▪ In Europe apparent demand down 20%, with UWF papers also the most resilient grade, with cutsize outperforming vs folio
Slide 15: Packaging - From Fossil to Forest
PACKAGING - From Fossil to Forest ▪ gKRAFT™ brand has won market recognition and continues to evolve: ▪ +230 active clients ▪ 30 countries ▪ development of new segments supported by 220 market trials with 100 BAGS FLEXIBLE PACKAGING CORRUGATED & SOLID MOLDED PULP (packs, pouches, food take-away, (re
Slide 16: Tissue Business
TISSUE BUSINESS ▪ Successful integration of new Tissue Ejea: SALES1 2 2023 ▪ Reinforced strategic position in Iberia (vs. 2022) ▪ 2nd largest Iberian player Type Geography3 ▪ annual production capacity of 165 ktons ▪ annual converting capacity of 180 ktons. Iberia ▪ Better-than-expected synergies Fi
Slide 17: Maturity and Liquidity
MATURITY AND LIQUIDITY ▪ Well-balanced debt maturities ▪ 46% of total debt is linked to sustainability target ▪ New long-term debt agreement with EIB: ▪ 115 million euros ▪ Maturities of up to 12 years ▪ Use of Proceeds: support the project to build and operate the high-efficiency recovery boiler, a
Slide 18: Financial Indicators
FINANCIAL INDICATORS << Capex M€ 187 Net Debt & Net Debt/EBITDA* ESG ▪ Value-added capex Structural, Expansion, Maintenance and Recurring 2.38 ▪ 57% ESG, aimed at decarbonization 106 113 1.92 1.68 targets and efficiency gains. 39 81 80 1.5 25 14 0.98 0.52 ▪ Net Debt/EBITDA below 1x, with: 66 74 81 5
Slide 19: We Create Value by Planting the Future
WE CREATE VALUE BY PLANTING THE FUTURE ENVIRONMENTAL SOCIAL GOVERNANCE CLIMATE ACTION & BIODIVERSITY WORKFORCE BOARD & ETHICS ▪ 6.2Mt CO2 sequestered ▪ 30 nationalities, 24 based in Portugal ▪ Executive Compensation Disclosure ▪ 69% Certified wood ▪ 110% increase in women in top management ▪ Transpa
Slide 20: Takeaways
TAKEAWAYS << ▪ Solid results, again, despite another year of challenging market conditions ▪ Consistent demand recovery from Q3 to date ▪ 2023 with significant reduction in managed cash costs: ▪ 15 to 20% drop in H2 vs. H2 2022 (peak); ▪ Delivering on our diversification plan: ▪ Tissue – Tissue Ejea
Slide 21: Q4/FY 2023 Results Presentation agenda
Q4/FY 2023 RESULTS PRESENTATION 01-Main Highlights 02-Market & Group Performance 03-New Business Opportunities 04-Outlook 20 20
Slide 22: Business Strategy
Business Strategy Reinforce core business and look for new growth opportunities Packaging ▪ Flexible ▪ Cupstock ▪ Kraftliner ▪ Molded Pulp Biomaterials Tissue ▪ Hygiene ▪ M&A and/or Mozambique ▪ Personal care ▪ Organic ▪ Wood exports ▪ Cosmetics E-fuels ▪ Logs and/or chips ▪ Health Renewable Energy
Slide 23: Q4/FY 2023 Results Presentation agenda
Q4/FY 2023 RESULTS PRESENTATION 01-Main Highlights 02-Market & Group Performance 03-New Business Opportunities 04- Outlook 22 22
Slide 24: Outlook
OUTLOOK << The current geopolitical tensions and the electoral supercycle increase volatility and reduce visibility. PULP: PAPER: TISSUE: ▪ For Q1 2024, pulp market is expected to ▪ 2024 began with solid order books, a positive ▪ By 2024, demand is expected to grow by recover gradually (both prices
Slide 25: Results Presentation Q4/FY 2023
Results Presentation Q4/FY 2023 February 26th 2024 24