Wendel Se · EURONEXT:MF
Wendel — Shareholder Meeting (June 2021)
88 slides from Wendel's shareholder meeting presentation, Jun 29, 2021
Slide 1: Annual Shareholders' Meeting
Annual Shareholders’Meeting June 29, 2021 2021 1
Slide 2: Agenda
Agenda 2020 highlights & portfolio performance by André François-Poncet, Group CEO 2020 consolidated results by Jérôme Michiels, Executive Vice-President, Chief Financial Officer 2021 and recent events by David Darmon, Group Deputy CEO 2024 roadmap by André François-Poncet, Group CEO ESG performance
Slide 3: 2020 highlights & portfolio performance
2020 highlights & portfolio performance André François-Poncet, Group CEO 3
Slide 4: 2020 in brief
2020 in brief Demonstrated portfolio resilience during an unprecedented crisis Preserved potential value creation opportunities Emphasized Engagement & ESG Able to capitalize on solid financial structure, €1.8bn liquidity and modest overall leverage at Wendel and portfolio levels Wendel and its port
Slide 5: 2020: a tale of two halves
2020: a tale of two halves First semester: Covid 19 outbreak / Second semester: Gradual end of lockdowns / Global lockdown of major economies Managed reopenings Focused on preserving value against precipitous Moved towards the rebound phase from Q3 declines in revenues and profits at many companies
Slide 6: 2020 highlights
2020 highlights Wendel Full disposal of Allied Universal and Tsebo Wendel office footprint rightsized Wendel Lab: additional capital committed to top quality funds ESG acceleration and extra-financial ratings improved Dividend maintained Executive Board reappointed Portfolio COVID-19 crisis: all com
Slide 7: Total liquidity of €1.8bn
Preserved solid financial structure and strong liquidity Modest LTV Ratio : 6.2% Corporate cash balance : €1.08 billion Total liquidity of €1.8bn €750m RCF available, fully undrawn As of December 31, 2020 Solid dual credit ratings : BBB & Baa2 7 2021 AGM | June, 2021
Slide 8: Quality of extra-financial information rewarded through ratings and distinctions in 2020
Quality of extra-financial information rewarded through ratings and distinctions in 2020 Extra-financial ratings 2020 2019: 1st assessment with a AA score Low Risk B Score 69/100 58 score (sectoral leader) Ranked #1 among (consistent management 2020: Inclusion in DJSI peers of similar market of clim
Slide 9: NAV discount remains high vs. historical data
NAV discount remains high vs. historical data A high discount despite : Comparably lower leverage at Wendel SE and portfolio -10,0% levels Last 10 years average discount: An overall financially -28.5% -20,0% resilient and refocused portfolio Stable dividend payment in -30,0% spite of the COVID crisi
Slide 10: 2020 portfolio performance
2020 portfolio performance André François-Poncet, Group CEO David Darmon, Group Deputy CEO 10
Slide 11: Bureau Veritas
Bureau Veritas § Revenues of €4.6bn, down 9.8% year-on-year, § Organic growth reached -6.0%, and -2.0% in Q4 § Adjusted operating margin down -294bps to 13.4%(1) § Strong free cash flow thanks to optimization measures +2.6% § Net debt / EBITDA ratio reduced YoY from 1.87x to 1.80x(2) § Reinstated an
Slide 12: 2020 performance of Group's unlisted companies
2020 performance of Group’s unlisted companies Sales €1,505.3m $63.8m €627.6m $1,403.1m €669.4m Δ -1.9% -27.3% -6.0% +14.0% -17.2% Organic growth -0.4% -27.3% -6.2% +16.3% -14.3% EBITDA EBIT for IHS €189.4m $26.1m €96.9m $410.4m €152.3m Margin 12.6% 40.9% 15.4% 29.2% 22.7% (1) EBIT and EBITDA before
Slide 13: Monthly sales analysis: impact of Covid-19 on unlisted companies
Monthly sales analysis: impact of Covid-19 on our consolidated unlisted companies 2019 2020 Basis 100: January 2019 sales Constantia Flexibles Crisis Prevention Institute 180 180 Resilience 160 160 Progressive recovery, 140 140 reducing the gap 120 120 100 100 80 80 60 60 40 40 20 20 - Jan Feb Mar A
Slide 14: Modest leverage at the end of 2020
Modest leverage at the end of 2020 No cash injected into our portfolio companies over the course of 2020 Net debt to Net debt to Net debt to Net debt EBITDA(1) EBITDA(1) EBITDA(1) (as of December, (as of Dec. 31, 2019) (as of June 30, 2020) (as of December 31, 31, including IFRS 2020) 16) Bureau Ver
Slide 15: 2020 consolidated results
2020 consolidated results Jérôme Michiels, Executive Vice President, Group CFO 15
Slide 16: Consolidated sales down 5.8% organically
Consolidated sales down 5.8% organically, with Q4 only down -1.0% Consolidated sales (in €m) -8.0% 8,110.5 Organic -5.8% 7,459.2 Scope +0.5% FX -2.7% 2019 2020 16 2021 AGM | June, 2021
Slide 17: Net loss Group share of €264.1 million
Net loss Group share of € 264.1 million in millions of euros 2019 2020 Contribution from subsidiaries 589.5 430.7 Financial & operating expenses and taxes (139.8) (114.2) In 2019: • €644m gain on sale of Net income from operations (1) 449.7 316.5 Allied Universal Non-recurring income 442.2 (105.7) I
Slide 18: Dividend
Dividend • Proposing a €2.90 per share dividend, up 3.6% 2.90 € 2.80 € 2.80 € 2.65 € Dividend increasing year on year 2.35 € 2.15 € 2.00 € 1.85 € 1.75 € 1.25 € 1.30 € 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 In euros per share, ordinary dividend The 2011 ordinary dividend included an e
Slide 19: 2021 and recent performance
2021 and recent performance David Darmon, Group Deputy CEO 19
Slide 20: Q1 2021 trading update key highlights
Q1 2021 trading update key highlights NAV : €167.4 per share, up 5.3% year-to-date (as of March 31, 2021) • Positively impacted by market recovery • Last twelve months NAV growth of +41.7% Q1 2021 consolidated sales: €1,913m, up 2.0% overall and 6.5% organically Strong financial structure • At Wende
Slide 21: Partnership with the Deconinck family to acquire the shares of Tarkett
Partnership with the Deconinck family to acquire the shares of Tarkett • Simplified tender offer on all Tarkett shares at price of €20 per share (i.e. a premium of 38.1%)1 launched by Tarkett Participation, a company controlled by the Deconinck family and in which Wendel invests as a minority shareh
Slide 22: Q1 2021 performance of Group's companies
Q1 2021 performance of Group’s companies Sales €1,154.7m €366.7m $18.5m €166.0m $362m €210.1m Δ +1.3% -4.5% +10.0%(1) +22.6% +8.7% +4.6% Organic growth +6.6% -0.8% +2.7% +22.6% +14.6% +9.6% (1) Sales include a PPA restatement impact of -0,9M$. 22 2021 AGM | June, 2021
Slide 23: Monthly sales analysis: impact of Covid-19 on unlisted companies
Monthly sales analysis: impact of Covid-19 on our consolidated unlisted companies 2019 2020 2021 Basis 100 : January 2019 sales Constantia Flexibles Crisis Prevention Institute 180 180 160 160 Progressive recovery 140 Resilience 140 120 120 100 100 80 80 60 60 40 40 20 20 Jan Feb Mar Apr May June Ju
Slide 24: Net Asset Value bridge year-to-date
Net Asset Value bridge year-to-date • Two thirds of the growth attributable to market multiples • One third related to positive FX translation +5.1 -1.5 €167.4 +4.7 €159.1 Unlisted Other Assets Bureau Veritas 20-day average share price of Bureau Veritas increased from €22.4 to €23.7 NAV per share NA
Slide 25: Strong liquidity
Strong liquidity c. €1bn cash (1) + €750m undrawn credit facility Oct. 2024 (integrating ESG targets into the financial terms since end of March 2021) Average cost of debt: Cash available 2.09% Bond maturities Average maturity: 5.6 years 500 500 1,8 Md€ total liquidity Moody’s credit rating: 300 300
Slide 26: Wendel's financing guidelines
Wendel's financing guidelines Maintain available liquidity to enable Wendel to seize attractive opportunities (i.e., to safely make a €300M investment at most times) Flexible financing structure that can withstand sudden, pronounced market shocks potentially resulting in capital needs at portfolio l
Slide 27: 2024 roadmap & Investment strategy
2024 roadmap & Investment strategy André François-Poncet, Group CEO 27
Slide 28: A refocused portfolio, poised for further redeployment
A refocused portfolio, poised for further redeployment Beginning of 2018(1) Wendel as of end-2020 6 companies in portfolio: 13 companies in portfolio: Refocused on larger assets +Saint-Gobain ~€650 million returned to shareholders over the last 3 years 2021-2024 7 assets with equity Leadership chang
Slide 29: Vision and Wendel's 2024 Ambition: Portfolio
Vision and Wendel's 2024 Ambition: Portfolio Redeploy capital Diversify investment portfolio Redeploy generally towards with balanced exposure to Diversify higher growth, listed and unlisted companies ESG-friendly assets Target Portfolio Build portfolio of 7-10 companies with new investments of c. €
Slide 30: Portfolio: what we are looking for
Portfolio: what we are looking for Growing, resilient with ESG potential Equity c.€150-500M over time per investment value creation Investment (smaller amounts for growth equity) Partner with like-minded management teams or co-investors EV of €350-2,500M with minimum with demonstrated track record C
Slide 31: Portfolio: Wendel Lab
Portfolio: Wendel Lab … Today: >€100m(1) committed Wendel Lab objectives… with high quality partners • Build intelligence and expertise on disruptive Funds technological and digital trends • Develop an ecosystem of innovative partners to create synergies with our portfolio companies New New New New
Slide 32: Wendel's 2024 target portfolio & returns
Wendel’s 2024 target portfolio & returns Private Equity Listed Equity Growth Equity/ VC1 Buyout % of NAV Balanced % c. 5 to 10% Target average ~c. 10-15% (for funds) annual return Above c.7% Above c.10% Above 25% in direct investments profile 1-Including funds 32 2021 AGM | June, 2021
Slide 33: Q1 2021 key takeaways
Q1 2021 key takeways Good level of activity of our portfolio companies compared to 2019 with a focus on procurement costs A more active redeployment of capital based on strong balance sheets Reinforced investment teams for European assets 33 2021 AGM | June, 2021
Slide 34: Environmental, social and governance performance
Environmental, social and governance performance Christine Anglade Pirzadeh, Sustainable Development and Communications Director 34
Slide 35: Implementing an ESG roadmap for Wendel and portfolio companies
Implementing an ESG roadmap for Wendel and portfolio companies At Wendel level • Publishing of our ESG Roadmap updated with 2020 values • 100+ ESG indicators published • A 360° approach covering all our social and environmental impacts and measuring results of initiatives implemented At portfolio le
Slide 36: Wendel's ESG performance in 2020 - Summary
Wendel's ESG performance in 2020 - Summary Business ethics & compliance 98 % of employees received training in business ethics Strengthening of the third-party evaluation system (Sapin II compliance) Employment, inclusion and engagement 54 % of women, with 37 % in investment teams 98 % of employees
Slide 37: ESG Performance in Wendel's portfolio - Summary
ESG Performance in Wendel’s portfolio - Summary Climate change - 23 % of CO2 emissions Emission reduction goal -20 % reduction goal of 103 % revenue increase 11 % drop of carbon per employee (vs. 2019) aligned of the Paris carbon emissions by 2030 for online trainings, avoiding emissions ratios link
Slide 38: ESG at the heart of Wendel's overall performance approach
ESG at the heart of Wendel's overall performance approach For 2021, 100 % of our controlled companies CEOs have a variable compensation partially conditioned by the achievement of ESG objectives The 2021-2024 stock-option allocation plan for Wendel employees is indexed on an ESG performance criteria
Slide 39: Extra-financial ratings and transparency
Extra-financial ratings and transparency AA score Ranked as "low risk" 2021: Score to be 2021: Score to be announced 2020 : 69/100 (sectoral leader) announced 2020: Inclusion in DJSI World 2020: B score (consistent and DJSI Europe with a 71 management of climate score change in business activities)
Slide 40: Governance and compensation
Governance and compensation Jacqueline Tammenoms Bakker Chair of the Governance and Sustainability Committee 41
Slide 41: Supervisory Board – composition before the Shareholders' Meeting
Supervisory Board – composition before the Shareholders’ Meeting Priscilla de Moustier Jacqueline Tammenoms Bakker Nicolas ver Hulst Gervais Pellissier Guylaine Saucier Chair of the Governance and Sustainability Chairman Vice-President Chair of the Audit, Risks and Committee Lead Member Compliance C
Slide 42: Supervisory Board and Committees – composition following the Shareholders' Meeting
Supervisory Board and Committees – composition following the Shareholders’ Meeting Caracteristics: Gender diversity: § 12 members of which 2 representing employees § 7 women and 5 men § 40%* independent members § proportion of women: § 6 nationalities • 58% (among all members) § 59 years old average
Slide 43: Executive Board – reappointment for a 4-year term
Executive Board – reappointment for a 4-year term André François-Poncet David Darmon Chairman of the Executive Board Member of the Executive Board (Group CEO) (Group Deputy CEO) as of January 1st, 2018 as of September 9, 2019 The Supervisory Board decided to reappoint the members of the Executive Bo
Slide 44: Executive Board 2020 compensation
Executive Board 2020 compensation pages 113 to 134 of the 2020 Universal Registration Document Resolution 13: General information on 2020 corporate officers’ compensation Resolution 14: André François-Poncet, Executive Board Chairman Resolution 15: David Darmon, Executive Board member Resolution 16:
Slide 45: 2020 fixed and variable compensation / other items and benefits
2020 fixe and variable compensation / other items and benefits of all kinds Application of the compensation policy approved by the 2020 Shareholders’ Meeting André François-Poncet David Darmon Fixed compensation* € 1 078 125 € 562 500 Variable compensation € 912 525 € 476 100 *Amounts taking into ac
Slide 46: Variable compensation – Achievement rate of 2020 objectives
Variable compensation – Achievement rate of 2020 objectives Achievement Weighting Part of variable max. Financial objectives 52.3% 65% 34% Non-financial objective 100% 35% 35% Total 69% Financial objectives (achieved up to 52.3%): Bureau Veritas performance: lower than objectives determined before t
Slide 47: Stock options and performance shares allocated in 2020
Stock options and performance shares allocated in 2020 Application of the compensation policy approved by the 2020 Shareholders’ Meeting André François-Poncet David Darmon Stock options 22 341 20 625 Performance shares 35 745 6 875 Presence condition: 2 years Performance conditions: assessed over 3
Slide 48: Executive Board 2021 compensation policy
Executive Board 2021 compensation policy pages 103 to 112 of the 2020 Universal Registration Document Resolution 10: Executive Board Chairman Resolution 11: Executive Board member 49 2021 AGM | June, 2021
Slide 49: Overhaul of the Executive Board compensation policy for 2021-2024 term
Overhaul of the Executive Board compensation policy for the new 2021-2024 term Application to a part of Wendel’s workforce Pay for performance / alignement with shareholders / simplicity Consistency with Wendel’s corporate purpose and new strategy Talents motivation / retention Crisis context Benchm
Slide 50: 2021 Executive Board compensation structure
2021 Executive Board compensation structure Balanced and challenging structure: with performance conditions 77% 23% without performance conditions Fixed SO/PS Bonus long-term compensation 50% 50% annual compensation 51 2021 AGM | June, 2021
Slide 51: 2021 Fixed and variable compensation / other items and benefits
2021 Fixed and variable compensation / other items and benefits of all kinds Fixed compensation • € 1 150 000 for the Chairman of the Executive Board • € 770 000 for the Executive Board member Variable compensation • maximum 115% of fixed compensation Other items and benefits of all kinds, in partic
Slide 52: Details on the 2021 variable compensation
Details on the 2021 variable compensation Type of objective Weighting Financial objectives 65% Bureau Veritas performance 20% 5 unlisted portfolio companies performance (IHS, Stahl, 25% Constantia, Cromology and CPI) Maintaining Wendel's Investment Grade rating 20% Non-financial objective 35% Wendel
Slide 53: 2021 grant of stock options and performance shares
2021 grant of stock options and performance shares Presence condition: extended to 2 to 4 years acquisition thresholds of 50% after 2 years, 75% after 3 years and 100% after 4 years Performance conditions: assessed over a period extended to 3 to 4 years stock options: ESG strategy (climate risk awar
Slide 54: Departure of an Executive Board member
Departure of an Executive Board member Termination benefits: Alignment of the Executive Board Chairman termination benefits’ terms Amount: 18 months of fixed and paid variable compensation 2 performance conditions: ü last dividend before departure ≥ previous dividend ü paid variable ≥ 70% of maximum
Slide 55: Supervisory Board compensation
Supervisory Board compensation pages 103, 104, 112, 129 and 135 of the 2020 Universal Registration Document Resolution 12: Compensation policy of the Supervisory Board members Resolution 17: 2020 compensation of Nicolas ver Hulst, Chairman of the Board 56 2021 AGM | June, 2021
Slide 56: 2020 compensation of the Supervisory Board Chairman
2020 compensation of the Supervisory Board Chairman Application of the compensation policy approved by the 2020 Shareholders’ Meeting Nicolas ver Hulst Meetings-related compensation € 93 750* Specific compensation € 250 000 *Amount taking into account the voluntary waiver Solidarity in the framework
Slide 57: 2021 compensation policy of the Supervisory Board members
2021 compensation policy of the Supervisory Board members Unchanged envelope compared to 2020: maximum € 900 000 Fixed / year Variable / meeting Ordinary compensation € 25 000 € 3 000 (for all Board members except Chairman) Additional compensation for Committee membership € 10 000 € 1 700 (for all C
Slide 58: Presentation of the conclusions of the statutory auditors
Presentation of the conclusions of the statutory auditors Shareholders’ Meeting of June 29th 2021
Slide 59: Reports of the auditors
Reports of the auditors 1. Statutory Auditors’ report on consolidated financial statements (Universal Registration Document pages 409-414) 2. Statutory Auditors’ report on the financial statements of Wendel SE (Universal Registration Document pages 437-440) 3. Statutory Auditors’ report on related-p
Slide 60: Reports on the consolidated and statutory financial statements
Reports on the consolidated and statutory financial statements Title of report Opinion Justification of Assessments – Key Audit Matters - Accounting treatment of acquisition and divestment of portfolio companies Statutory Auditors’ report on the - Measurement of goodwill consolidated financial Unqua
Slide 61: Statutory Auditors' report on related-party agreements
Statutory Auditors’ report on related-party agreements Title of report Observations ► We have been informed that the following agreements, authorized and/or concluded through the year or since the year ended, were previously authorized by your Supervisory Board: ► Five agreements with Wendel-Partici
Slide 62: Reports pertaining to resolutions of the Extraordinary Meeting
Reports pertaining to resolutions of the Extraordinary Meeting Period of authorization Resolution Subject granted to the Executive Terms Board Statutory Auditors’ report on the issue of shares or securities giving access to the ► The maximum nominal amount of the capital increases that may capilal w
Slide 63: Questions / Answers
Questions / Answers WENDEL
Slide 64: Resolutions
Resolutions Caroline Bertin Delacour, General Counsel 65
Slide 65: Resolution n°1
Resolution n°1 Approval of the parent company financial statements for 2020 Net loss: €26.6 million Approved resolution: 99.76% 66 2021 AGM | June, 2021
Slide 66: Resolution n°2
Resolution n°2 Approval of the consolidated financial statements for 2020 Net loss, Group share: €264.1 million Approved resolution: 99.58% 67 2021 AGM | June, 2021
Slide 67: Resolution n°3
Resolution n°3 Net income allocation, dividend approval and dividend payment • Dividend: €2.90 • Ex-dividend date: July 1, 2021 • Dividend payment date: July 5, 2021 Approved resolution: 99.77% 68 2021 AGM | June, 2021
Slide 68: Resolution n°4
Resolution n°4 Approval of regulated related-party agreements entered into with certain corporate officers • André François-Poncet, Chairman of the Executive Board • David Darmon, member of the Executive Board • Harper Mates, member of the Supervisory Board representing employees • Sophie Tomasi Par
Slide 69: Resolution n°5
Resolution n°5 Approval of regulated related-party agreements entered into with Wendel-Participations SE Approved resolution: 99.53% 70 2021 AGM | June, 2021
Slide 70: Resolution n°6
Resolution n°6 Renewal of Nicolas ver Hulst at the Supervisory Board Term of office: 4 years Approved resolution: 91.26% 71 2021 AGM | June, 2021
Slide 71: Resolution n°7
Resolution n°7 Renewal of Priscilla de Moustier at the Supervisory Board Term of office: 4 years Approved resolution: 87.44% 72 2021 AGM | June, 2021
Slide 72: Resolution n°8
Resolution n°8 Renewal of Bénédicte Coste at the Supervisory Board Term of office: 4 years Approved resolution: 87.16% 73 2021 AGM | June, 2021
Slide 73: Resolution n°9
Resolution n°9 Appointment of François de Mitry at the Supervisory Board Term of office: 4 years Approved resolution: 87.02% 74 2021 AGM | June, 2021
Slide 74: Resolution n°10
Resolution n°10 Approval of the 2021 compensation policy for the Chairman of the Executive Board Approved resolution: 96.79% 75 2021 AGM | June, 2021
Slide 75: Resolution n°11
Resolution n°11 Approval of the 2021 compensation policy for the member of the Executive Board Approved resolution: 96.68% 76 2021 AGM | June, 2021
Slide 76: Resolution n°12
Resolution n°12 Approval of the 2021 compensation policy for the members of the Supervisory Board Approved resolution: 99.23% 77 2021 AGM | June, 2021
Slide 77: Resolution n°13
Resolution n°13 Approval of the information relating to the 2020 compensation of the members of the Executive Board and the members of the Supervisory Board Approved resolution: 98.38% 78 2021 AGM | June, 2021
Slide 78: Resolution n°14
Resolution n°14 Approval of the compensation items paid during or awarded for 2020 to André François-Poncet, as Chairman of the Executive Board Approved resolution: 93.79% 79 2021 AGM | June, 2021
Slide 79: Resolution n°15
Resolution n°15 Approval of the compensation items paid during or awarded for 2020 to David Darmon, as a member of the Executive Board Approved resolution: 93.81% 80 2021 AGM | June, 2021
Slide 80: Resolution n°16
Resolution n°16 Approval of the compensation items paid during or awarded for 2020 to Bernard Gautier, as a member of the Executive Board until September 9, 2019 Approved resolution: 98.59% 81 2021 AGM | June, 2021
Slide 81: Resolution n°17
Resolution n°17 Approval of the compensation items paid during or awarded for 2020 to Nicolas ver Hulst, as Chairman of the Supervisory Board Approved resolution: 99.27% 82 2021 AGM | June, 2021
Slide 82: Resolution n°18
Resolution n°18 Authorization given to the Executive Board to purchase Company shares • Ceiling: 10% of share capital • Maximum purchase price: €250 per share • Validity period: 14 months Approved resolution: 99.24% 83 2021 AGM | June, 2021
Slide 83: Resolution n°19
Resolution n°19 Delegation of authority granted to the Executive Board to increase the share capital with cancellation of preferential subscription rights in favor of members of the Group Savings Plan • Ceiling: €150 000 • Validity period: 14 months Approved resolution: 97.99% 84 2021 AGM | June, 20
Slide 84: Resolution n°20
Resolution n°20 Authorization given to the Executive Board to grant stock subscription or purchase options to the Company’s executive corporate officers and employees • Ceiling: 1% of share capital (common with resolution n°21) • Specific sub-ceiling for Executive Board members • Validity period: 14
Slide 85: Resolution n°21
Resolution n°21 Authorization given to the Executive Board to grant bonus shares to the Company’s executive corporate officers and employees • Ceiling: 1% of share capital (common with resolution n°20) • Specific sub-ceiling for Executive Board members • Validity period: 14 months Approved resolutio
Slide 86: Resolution n°22
Resolution n°22 Powers for legal formalities Approved resolution: 99.95% 87 2021 AGM | June, 2021
Slide 87: Disclaimer
Disclaimer • This document has been prepared by Wendel S.E. (“Wendel”) solely for use at the presentation of the Annual Shareholders’ meeting to be held on June 29, 2021. This document must be treated confidentially by attendees at such presentation and may not be reproduced or redistributed to any
Slide 88: 2021 AGM | June, 2021
89 2021 AGM | June, 2021