Lenzing Ag · VIE:LNZ
Lenzing — H1 2020 Earnings Presentation
31 slides from Lenzing's earnings presentation, Aug 5, 2020
Slide 1: Lenzing Investor Presentation
Lenzing Investor Presentation Results 01-06/2020 August 5, 2020 www.lenzing.com
Slide 2: Disclaimer
Disclaimer ● The information contained in this document has not been independently verified and no representation or warranty expressed or implied is made as to, and no reliance should be placed on, the fairness, accuracy, completeness or correctness of this information or opinions contained herein.
Slide 3: At a glance
At a glance H1-2020 financial results 2020 guidance: Q2-2020 marked the trough, ● Revenue of EUR 810mn (EUR 1,089mn in H1-2019) sequential improvement in coming quarters expected ● Reflecting Covid-19 related price and demand weakness ● Still limited visibility due to Covid-19 pandemic ● EBITDA of E
Slide 4: Covid-19: taking care of our people, partners and operations
Covid-19: taking care of our people, partners and operations Protecting our people and business partners Measures taken to ensure business continuity ● Close cooperation with authorities ● Close interaction and cooperation with up- and ● Home office rolled out globally, except for downstream value c
Slide 5: Textile retail sales recover, but with regional differences
Textile retail sales recover, but with regional differences North America Apparel Retail Traffic (% YOY) Retail Sales Clothing US (% YOY) 60 20 40 0 20 0 -20 -20 -40 -40 -60 -60 -80 -80 -100 -100 May-19 Jul-19 Sep-19 Nov-19 Jan-20 Mar-20 May-20 Jul-20 Jun-18 Sep-18 Dec-18 Mar-19 Jun-19 Sep-19 Dec-19
Slide 6: Consumers look for TENCEL™ and “Sustainable Clothing”
Consumers look for TENCEL™ and “Sustainable Clothing” Google search volumes for TENCEL™ Google search volumes for “Sustainable clothing” 100 100 90 90 80 80 70 70 60 50 60 40 50 30 40 20 Aug-19 Sep-19 Oct-19 Nov-19 Dec-19 Jan-20 Feb-20 Mar-20 Apr-20 May-20 Jun-20 Jul-20 Aug-19 Sep-19 Oct-19 Nov-19 D
Slide 7: Market update
Market update www.lenzing.com
Slide 8: Weak demand environment weighs on commodity prices
Weak demand environment weighs on commodity prices Cotton could escape the trend recently, VSF and PSF hit new lows VSF1 price trend and theoretical profit / loss in China RMB/ton USD/kg (incl. VAT) RMB/ton 2.50 14,000 0 2.30 2.10 13,000 -500 1.90 12,000 1.70 -1,000 1.50 11,000 1.30 -1,500 10,000 1.
Slide 9: Specialty prices kept their relative premium to commodities
Specialty prices kept their relative premium to commodities 120 115 110 Lenzing Specialties1,2 105 (Include Lenzing specialty 100 viscose which is priced 95 on “VSF plus“ basis) 90 85 Cotton Index1 80 75 70 65 60 VSF (TX) CCF high1 0 Jan-17 Apr-17 Jul-17 Oct-17 Jan-18 Apr-18 Jul-18 Oct-18 Jan-19 Apr
Slide 10: Expansion projects
Expansion projects www.lenzing.com
Slide 11: Pulp expansion project in Brazil on track
Pulp expansion project in Brazil on track ● JV LD Celulose (LDC): Lenzing holds 51 %, Duratex 49 % Key facts: Financing details: ● 500 kt single line dissolving wood pulp mill ● JV financing structure: 37 % equity, 63 % debt Largest of its kind ● Debt guaranteed on pro-rata basis by sponsors Brazil
Slide 12: Construction diary – Brazil
Construction diary – Brazil Overview construction site Temporary offices Temporary water and effluent treatment plant CAE pipeline www.lenzing.com 05/08/2020 - 12
Slide 13: Lyocell expansion project in Thailand fully on track
Lyocell expansion project in Thailand fully on track Key facts: ● 100 kt lyocell fiber plant Largest of its kind ● EUR 400 mn industrial capex ● Project on time and within budget ● Ramp-up expected end of 2021 ● Bioenergy secured ● Attractive tax incentive scheme www.lenzing.com 05/08/2020 - 13
Slide 14: Construction diary – Thailand
Construction diary – Thailand www.lenzing.com 05/08/2020 - 14
Slide 15: Financials
Financials www.lenzing.com
Slide 16: P&L – Revenue
P&L – Revenue EUR mn (34.9) % (25.6) % Group revenue by application Group revenue by type H1/2020 1,089 529 529 487 466 17% 29% 28% 33% 810 53% 344 23% 60% 71% 72% 67% 47% Q2/2019 Q3/2019 Q4/2019 Q1/2020 Q2/2020 H1/2019 H1/2020 Q1/2019 Q4/2019 Q1/2020 Q2/2020 Specialty fibers1 Standard fibers Group
Slide 17: P&L – EBITDA
P&L – EBITDA EBITDA margin EBITDA margin 16.9 % 16.2 % 12.3 % 14.9 % 7.9% 16.6% 11.9% EUR mn EUR mn (69.7)% (46.6)% 89.2 181.2 85.7 69.6 60.0 96.7 27.1 Q2/2019 Q3/2019 Q4/2019 Q1/2020 Q2/2020 H1/2019 H1/2020 EBITDA EBITDA www.lenzing.com 05/08/2020 - 17
Slide 18: P&L – EBIT
P&L – EBIT EBIT margin EBIT margin 9.7 % 9.0 % 1.8 % 6.5 % (3.7) % 9.7% 2.2% EUR mn EUR mn (83.4)% 105.6 51.2 47.9 30.4 8.8 17.6 (12.8) Q2/2019 Q3/2019 Q4/2019 Q1/2020 Q2/2020 H1/2019 H1/2020 EBIT EBIT www.lenzing.com 05/08/2020 - 18
Slide 19: P&L – Net profit and earnings per share
P&L – Net profit and earnings per share EPS1 (EUR) EPS1 (EUR) 1.32 1.45 0.21 0.84 (0.78) 2.97 0.06 EUR mn EUR mn (98.1)% 78.8 35.0 38.4 22.2 5.7 1.5 (20.7) H1/2019 H1/2020 Q2/2019 Q3/2019 Q4/2019 Q1/2020 Q2/2020 Group net profit1 Group net profit1 1) Attributable to Lenzing AG shareholders www.lenzi
Slide 20: Quarterly cash flow and working capital development
Quarterly cash flow and working capital development EUR mn EUR mn (68.6) % Gross CF 500.0 474 0.45 453 439 Q2/2019 Q3/2019 Q4/2019 Q1/2020 Q2/2020 450.0 436 0.40 80.0 78.9 73.6 404 51.5 400.0 31.7% 0.35 50.1 47.2 38.8 31.9 25.1 350.0 0.30 24.3% 0.8 300.0 20.8% 22.4% 20.7% 0.25 (17.4) (10.7) 250.0 0.
Slide 21: Balance sheet metrics
Balance sheet metrics Change According to IFRS (EUR mn) 30 June 2020 31 Dec. 2019 in % Total assets 3,433.5 3,121.1 10.0 (1,296) Liquid assets1 594.5 581.0 2.3 (1133) thereof liquid funds 588.1 571.5 2.9 Total liabilities 2,024.9 1,583.2 27.9 (982) thereof financial liabilities 1,295.8 981.6 32.0 Ad
Slide 22: Outlook
w.lenzing.com Outlook e | Lenzing Innovative by nature
Slide 23: Outlook
Outlook 2020 guidance: Q2-2020 marked the trough, sequential improvement in coming quarters expected ● Currently very limited visibility due to Covid-19 pandemic ● Textile fiber markets recover, but with heterogeneous price and demand momentum ● Nonwoven fibers still benefit from increased hygiene a
Slide 24: for your attention!
for your attention! www.lenzing.com
Slide 25: Appendix
Appendix H1/2020 detailed financials www.lenzing.com
Slide 26: H1/2020: Group P&L
H1/2020: Group P&L Change Change Change (EUR mn) Q2/2020 Q1/2020 Q2/Q1 (%) Q2/2019 Q2/Q2 (%) H1/2020 H1/2019 H1/H1 (%) Revenue 343.9 466.3 (26.2) 528.5 (34.9) 810.2 1,088.5 (25.6) Change in inventories of finished goods and work in progress (7.1) 14.8 - 22.2 - 7.7 16.7 (53.9) Own work capitalized 14
Slide 27: H1/2020: Topline breakdown
H1/2020: Topline breakdown Change Change Change (EUR mn) Q2/2020 Q1/2020 Q2/Q1 (%) Q2/2019 Q2/Q2 (%) H1/2020 H1/2019 H1/H1 (%) Breakdown of Fibers segment revenue Textile fibers (%) 47.5 66.9 (29.0) 69.8 (31.9) 57.2 70.3 (18.6) Nonwoven fibers (%) 52.5 33.1 58.6 30.2 73.8 42.8 29.7 44.1 Fibers only
Slide 28: H1/2020: Cash flow development
H1/2020: Cash flow development Change Change Change (EUR mn) Q2/2020 Q1/2020 Q2/Q1 (%) Q2/2019 Q2/Q2 (%) H1/2020 H1/2019 H1/H1 (%) Gross cash flow (before taxes and interest) 29.8 52.6 (43.4) 99.4 (70.1) 82.3 199.0 (58.6) Taxes and interest (4.7) (13.8) (66.3) (19.4) (76.0) (18.5) (35.4) (47.8) Gros
Slide 29: Q2/2020: Net debt bridge
Q2/2020: Net debt bridge Net Financial Cash capex2 Change in Change Net Financial Debt Q1 incl. fin. Trading in other Capital Currency IFRS 16 Debt Q2 2020 Tax Net Interest Gross CF1 assets WC WC Dividend Increase Translation Leasing Others 2020 Change in total working capital EUR (76.9) mn3 561.3 0
Slide 30: H1/2020: Net debt bridge
H1/2020: Net debt bridge Net Financial Cash capex2 Change in Change Debt FY incl. fin. Trading in other Capital Currency IFRS 16 Net Financial 2019 Tax Net Interest Gross CF1 assets WC WC Dividend Increase Translation Leasing Others Debt H1 2020 Change in total working capital EUR (84.6) mn3 400.6 1
Slide 31: Contact and financial calendar
Contact and financial calendar Investor contact Financial calendar Stephan Trubrich, CFA Half-year results 2020 August 5, 2020 Vice President Capital Markets Results 01-09/2020 November 4, 2020 Annual results 2020 March 11, 2021 Phone: +43 7672 701 3416 E-mail: s.trubrich@lenzing.com 77th Annual Gen