Wienerberger Ag · VIE:WIE
Wienerberger — FY2023 Earnings Presentation
52 slides from Wienerberger's earnings presentation, Feb 21, 2024
Slide 1: World of wienerberger
tS world of wienerberger
Slide 2: Cautionary note regarding forward-looking statements
DISCLAIMER CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS › 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 correctne
Slide 3: Wienerberger today
WIENERBERGER TODAY INCREASED RESILIENCE DUE TO THE SUCCESSFUL TRANSFORMATION INTO A PROVIDER OF INNOVATIVE AND SUSTAINABLE SOLUTIONS Improved end market exposure Driving organic growth Strong ESG commitment via innovative products less cyclical, more resilient 32% revenue share of innovative Infrast
Slide 4: 2023: A successful year for wienerberger
FY 2023 2023: A SUCCESSFUL YEAR FOR WIENERBERGER High profitability sustained: Operating EBITDA of ✓ ✓ ✓ Quick adaptation Operating EBITDA margin to changing end markets 19.2% € 811 mn Investment grade rating ESG Program 2023 ✓ ✓ ✓ Baa3 (stable) successfully Attractive payout for our shareholders by
Slide 5: End market development 2023
FY 2023 END MARKET DEVELOPMENT 2023 EUROPE NORTH AMERICA › High inflation and financing costs hit new build hardest in 2023 NEW BUILD -35% -20% › Overall stable developments within infrastructure RENOVATION -15% -3% › Europe East more affected in H1 2023, while Europe West saw INFRASTRUCTURE stable
Slide 6: Successful navigation through 2023: adjusted cost structure and innovation focus
FY 2023 SUCCESSFUL NAVIGATION THROUGH 2023: ADJUSTED COST STRUCTURE AND SUSTAINED FOCUS ON INNOVATION › Innovation rate 32% revenue share › Cost management € 81 mn fixed costs saved Strong › Self-help measures € 46 mn earnings enhancement results › Price over cost ~4% outperformance 2023 › Capex sav
Slide 7: Operating EBITDA of €811 mn represents exceptional achievement
FY 2023 OPERATING EBITDA OF € 811 MN REPRESENTS EXCEPTIONAL ACHIEVEMENT IN THE MARKET ENVIRONMENT OF 2023 OPERATING ✓ ✓ 110% EBITDA € 1,020 1000 100% GUIDANCE 96% € 910 100% ACHIEVED 93% € 811 End markets Market 800 90% outperformed € 694 91% 91% ✓ development 80% € 610 72% 600 70% Profitability € 4
Slide 8: Sustainability at wienerberger
Sustainability at wienerberger © Robert Staudinger 8
Slide 9: We achieved our targets from the Sustainability Program 2023
SUSTAINABILITY AT WIENERBERGER WE ACHIEVED OUR AMBITIOUS TARGETS FROM THE SUSTAINABILITY PROGRAM 2023… Successful Decarbonization -15% CO2 emissions vs. 2020 ✓ Circularity 100% of new products reusable or recyclable 99% Biodiversity Biodiversity program for all our production sites in place ✓ Traini
Slide 10: Expanded sustainability program until 2026
SUSTAINABILITY AT WIENERBERGER …AND EXPANDED THE CURRENT SUSTAINABILITY PROGRAM UNTIL 2026 2023 Targets 2026 Targets For details, please refer to the appendix 10
Slide 11: Wienerberger contributes to global CO2 emissions reduction efforts
SUSTAINABILITY AT WIENERBERGER WIENERBERGER CONTRIBUTES TO GLOBAL CO2 EMISSIONS REDUCTION EFFORTS GLOBAL WIENERBERGER WIENERBERGER EMISSION TARGETS MEASURES TARGETS UNTIL 2026 › Switch to green energy -25% CO2 emissions (scope 1 & 2) › Raw materials › Primary energy sources and raw materials (decarb
Slide 12: We meet customers' sustainability needs and contribute to net zero buildings
SUSTAINABILITY AT WIENERBERGER WE MEET OUR CUSTOMERS SUSTAINABILITY NEEDS AND CONTRIBUTE TO NET ZERO BUILDINGS 39% Our products are of global energy and part of the solution process-related CO2 emissions come from existing buildings › systems for roofs › 28% come from the operation › outer walls inc
Slide 13: Strategic highlights 2023
Strategic highlights 2023 13
Slide 14: Innovative strength: we use artificial intelligence to improve production efficiency
INNOVATION AT WIENERBERGER INNOVATIVE STRENGTH: WE USE ARTIFICIAL INTELLIGENCE TO IMPROVE EFFICIENCY IN THE PRODUCTION Raw materials › Complex production process due to constantly changing parameters: moisture of clay, production volume, utilization, etc. Preparation › >800 Parameters are monitored
Slide 15: Our solutions prevent water loss
INNOVATION AT WIENERBERGER OUR SOLUTIONS PREVENT WATER LOSS >50% of drinking water is lost due to inadequate water management and poorly maintained infrastructure wienerberger offers smart probes for infrastructure to monitor water pressure and save water › Detection of small cracks in pipes ✓ › Rea
Slide 16: Self-help target of €135 mn achieved; measures to be continued
OPERATIONAL EXCELLENCE SELF-HELP TARGET OF € 135 MN (2021-2023) ACHIEVED; MEASURES TO BE CONTINUED EARNINGS ENHANCEMENTS EBITDA contribution coming from 2021-2023 › Innovation › Manufacturing excellence › Procurement › Supply Chain Management and General administration € 100 mn Earnings enhancements
Slide 17: M&A focus in 2023: value creating acquisitions
M&A AND PORTFOLIO OPTIMIZATION M&A FOCUS IN 2023: VALUE CREATING ACQUISITIONS Otto BERGMANN OTTO Bergmann GmbH GMBH KompromentAPS KOMPROMENT ApSAND and STRØJER Strøjer Wideco SWEDEN WIDECO Sweden AB AB © Reiulf Ramstad Arkitekter © Otto Bergmann GmbH © Wideco Sweden AB › Specializes in the productio
Slide 18: M&A focus in 2023: preparation of Terreal integration
M&A AND PORTFOLIO OPTIMIZATION M&A FOCUS IN 2023: PREPARATION OF TERREAL INTEGRATION FINANCIAL CONSIDERATIONS › EBITDA run-rate of € 100 mn also confirmed CLOSING in 2023 › All regulatory approvals for wienerberger scope › Synergy targets will not be significantly received without material remedies
Slide 19: Final divestment of Russian business in February 2024
M&A AND PORTFOLIO OPTIMIZATION FINAL DIVESTMENT OF RUSSIAN BUSINESS IN FEBRUARY 2024 › Management buyout developed further to a final sale due to increasing political risk › Russian business › 2 production sites for clay blocks › Russian business accounted for less than 1% of wienerberger’s total re
Slide 20: Financials 2023
FINANCIALS 2023 20
Slide 21: Profitability maintained: strong contributions from cost management and self-help
FY 2023 PROFITABILITY MAINTAINED: STRONG CONTRIBUTIONS FROM PROACTIVE COST MANAGEMENT AND SELF-HELP PROGRAM Revenue Operating EBITDA Operating EBITDA margin € 4,224 mn € 811 mn 19.2% (FY 2022: € 4,977 mn | -15%) (FY 2022: € 1,021 mn | -21%) (FY 2022: 20.5% | -130bp) Net result Net Debt / Operating E
Slide 22: We outperformed challenging markets with proactive management
FY 2023 WE OUTPERFORMED CHALLENGING MARKETS WITH PROACTIVE MANAGEMENT Increased financing costs and high inflation impacted demand External revenues (in € mn) FY 2023 FY 2022 Chg. in % › Europe East was more affected in H1 2023, Europe West 2,193.1 2,522.0 -13 while Europe West saw declines in H2 20
Slide 23: Q4 results in-line; solid savings from strict cost management
Q4 2023 Q4 RESULTS IN-LINE; SOLID SAVINGS FROM STRICT COST MANAGEMENT Revenue Operating EBITDA € 939 mn € 146 mn (Q4 2022: € 1,129 mn | -17%) (Q4 2022: € 201 mn | -28%) Operating EBITDA margin Cost management savings 15.5% € 32 mn (Q4 2022: 17.8% | -230bp) 23
Slide 24: Improved infrastructure business and stabilization in new build Europe East
Q4 2023 IMPROVED INFRASTRUCTURE BUSINESS AND STABILIZATION IN NEW BUILD EUROPE EAST External revenues (in € mn) Q4 2023 Q4 2022 Chg. in % Europe East Europe West 487.4 599.3 -19 › Overall better development compared to H1 2023 Europe East 259.0 321.5 -19 North America 191.9 207.6 -8 Europe West wien
Slide 25: Revenue development
FY 2023 REVENUE DEVELOPMENT 4,977 -715 -98 4,224 in € mn Note: Rounding differences may arise from automatic processing of data * Foreign exchange effects include the impact of the application of IAS 29 (Financial Reporting in Hyperinflationary Economies) in combination with IAS 21 (The Effects of C
Slide 26: Operating EBITDA development
FY 2023 OPERATING EBITDA DEVELOPMENT 1,021 -197 -18 811 in € mn Note: Rounding differences may arise from automatic processing of data * Foreign exchange effects include the impact of the application of IAS 29 (Financial Reporting in Hyperinflationary Economies) in combination with IAS 21 (The Effec
Slide 27: Strict cost management measures implemented in 2023 to be continued in 2024
FY 2023 STRICT COST MANAGEMENT MEASURES IMPLEMENTED IN 2023 TO BE CONTINUED IN 2024 Cost efficiency in production FY 2023 › Adjustment of maintenance measures to reduced production activity € 81 mn › Continued focus on initiatives to reduce CO2 emissions fixed costs saved by Cost efficiency during s
Slide 28: Earnings encompass one-off costs from restructured businesses
FY 2023 EARNINGS ENCOMPASS ONE-OFF COSTS FROM RESTRUCTURED BUSINESSES Operating EBITDA € 1 021 € 910 € 811 EBITDA adjustments (in € mn) FY 2023 FY 2022 Operating EBITDA 810.8 1,020.9 Sale of assets1) 10.6 19.4 Structural adjustments2) -38.0 -14.1 in € mn EBITDA reported 783.3 1,026.2 Operating EBITD
Slide 29: Safeguarding normalized working capital and resilient financial leverage
FY 2023 CONTINUATION OF PROACTIVE MEASURES TO SAFEGUARD NORMALIZED WORKING CAPITAL AND A RESILIENT FINANCIAL LEVERAGE in € mn 31/12/2023 31/12/2022 2024e Net debt 1,214.7 1,079.3 ~€ 1.5 bn Net debt incl. Terreal Net debt / Operating EBITDA 1.5x 1.1x 1.6 - 1.8x Net debt / Operating EBITDA incl. Terre
Slide 30: 2023 Summary
2023 SUMMARY 30
Slide 31: 2023: A successful year for wienerberger
FY 2023 2023: A SUCCESSFUL YEAR FOR WIENERBERGER High profitability sustained: Operating EBITDA of ✓ ✓ ✓ Quick adaptation Operating EBITDA margin to changing end markets 19.2% € 811 mn Investment grade rating ESG Program 2023 ✓ ✓ ✓ Baa3 (stable) successfully Attractive payout for our shareholders by
Slide 32: Attractive payout for our shareholders
FY 2023 ATTRACTIVE PAYOUT FOR OUR SHAREHOLDERS SIGNIFICANT SHAREHOLDER RETURN IN 2023 DIVIDEND PROPOSAL 2023 € 0.90 per share € 121 mn returned to investors in 2023 › € 94.8 mn dividend payout › Payout ratio of 37% of free cash flow, which › € 26.0 mn through share buyback is at the upper end of our
Slide 33: Outlook 2024 / Mid-term development
OUTLOOK 2024 MID-TERM DEVELOPMENT 33
Slide 34: Market environment 2024
OUTLOOK 2024 MARKET ENVIRONMENT 2024 H1 2024 Difficult prediction of market Certain level of optimism for potential trend reversal due to: We anticipate a continuation of development in 2024 due to: the low activity levels in the › Geopolitical instability › Lower inflation rates building sector obs
Slide 35: Expected end market development 2024
OUTLOOK 2024 EXPECTED END MARKET DEVELOPMENT 2024 NORTH EUROPE AMERICA New build > +2% Renovation +/- 2% > -2% Infrastructure 35
Slide 36: Cost inflation assumptions 2024
OUTLOOK 2024 COST INFLATION ASSUMPTIONS 2024 Personnel costs Raw materials Energy Granulates ~+5% ~+0% ~-3% ~-4% High pressure in salary No more inflation catch-up Benefitting from forward +/-flat development negotiations due to expected in 2024 buying strategy expected after decline inflation level
Slide 37: We are well positioned to maneuver successfully through 2024
OUTLOOK 2024 WE ARE WELL POSITIONED TO MANEUVER SUCCESSFULLY THROUGH 2024 Forward-looking procurement Continuation of self-help program strategy to effectively manage with EBITDA contribution cost inflation of € 40 mn We will focus on cost management and pricing discipline to support our Further cos
Slide 38: Guidance 2024
OUTLOOK 2024 GUIDANCE 2024 € 860-890mn € ~810mn › Further end market decline expected › Market index down from 72% to 69% Market level Market level › Cost inflation covered by ~72% ~69% pricing discipline › Scope represents proportional EBITDA contribution of Terreal 38
Slide 39: Guidance 2024
OUTLOOK 2024 GUIDANCE 2024 € 1,020 110 wienerberger 100% 1000 96% € 910 € 860-890 100 To encounter the difficult market environment, 93% especially in Q1 2024, we continue our Market € 811 development800 90 › proactive cost management, € 694 91% 91% 80 › self-help and 600 € 601 72% 69% › strong pric
Slide 40: Outlook 2024 / Mid-term development
OUTLOOK 2024 MID-TERM DEVELOPMENT 40
Slide 41: Mid-term developments drive further growth of wienerberger
MID-TERM POTENTIALS MID-TERM DEVELOPMENTS DRIVE FURTHER GROWTH OF WIENERBERGER… Housing recovery in Europe Europe as driver Urgent need for and North America for growth climate resilience › Declining inflation and mortgage › Easing war in Ukraine and › Climate change leads to weather rates as cataly
Slide 42: Support operating EBITDA target of >€1.2 bn in 2026
MID-TERM DEVELOPMENT …AND SUPPORT OPERATING EBITDA TARGET OF € >1.2 BN IN 2026 811mn >1.2bn Our Road to 2026 € › Terreal contribution and synergies € › Organic Growth, based on payback Operating of growth CAPEX, innovation and system solutions Operating EBITDA › Estimated market recovery from EBITDA
Slide 43: Appendix
APPENDIX
Slide 44: Wienerberger's sustainability targets 2026
ESG AT WIENERBERGER WIENERBERGER’S SUSTAINABILITY TARGETS 2026 • 25% reduction CO2 emissions scope 1 & 2 (2020 - 2026) Decarbonization • 10% reduction CO2 emissions scope 3 (2022 - 2026) • 15% of renewable energy used in own operations (2023 - 2026) • >80% of sales from highly durable products (>100
Slide 45: Revenue development Q4 2023
Q4 2023 REVENUE DEVELOPMENT -181 -19 in € mn Note: Rounding differences may arise from automatic processing of data * Foreign exchange effects include the impact of the application of IAS 29 (Financial Reporting in Hyperinflationary Economies) in combination with IAS 21 (The Effects of Changes in Fo
Slide 46: Operating EBITDA development Q4 2023
Q4 2023 OPERATING EBITDA DEVELOPMENT -52 -4 in € mn Note: Rounding differences may arise from automatic processing of data * Foreign exchange effects include the impact of the application of IAS 29 (Financial Reporting in Hyperinflationary Economies) in combination with IAS 21 (The Effects of Change
Slide 47: Europe West: profitability at high level due to strict cost management
FY 2023 | EUROPE WEST PROFITABILITY AT HIGH LEVEL DUE TO STRICT COST MANAGEMENT AND EFFICIENCY GAINS EUROPE WEST › System solutions for the entire building envelope (wall, roof, facade) and › High interest rates lead to overall pavements as well as for wastewater and rainwater disposal, sanitation,
Slide 48: Europe East: disciplined cost management and adjusted plant capacities
FY 2023 | EUROPE EAST DISCIPLINED COST MANAGEMENT AND ADJUSTED PLANT CAPACITIES TO KEEP PROFITABILITY ON A HIGH LEVEL EUROPE EAST › Solutions for the building envelope (wall and roof) and pavements as well as for wastewater and rainwater disposal, sanitation, heating and cooling › Despite slight dec
Slide 49: North America: increased profitability based on strong pipes business
FY 2023 | NORTH AMERICA INCREASED PROFITABILITY BASED ON STRONG CONTRIBUTION FROM PIPES BUSINESS NORTH AMERICA › High interest rate levels throughout › Ceramic façade solutions as well as piping solutions for sustainable water 2023 dampened demand in new supply, rainwater sewage, and environmentally
Slide 50: Income statement
FY 2023 INCOME STATEMENT in € mn FY 2023 FY 2022 Chg. in % Revenues 4,224.3 4,976.7 -15 Operating EBITDA 810.8 1,020.9 -21 EBITDA 783.3 1,026.2 -24 Operating EBIT 494.7 739.6 -33 Impairment charges to assets -17.3 -18.4 +6 EBIT 477.3 721.2 -34 Financial result -53.0 -32.8 -61 Profit before tax 424.3
Slide 51: Cash flow statement
FY 2023 CASH FLOW STATEMENT in € mn FY 2023 FY 2022 Chg. in % Gross cash flow 608.5 878.4 -31 Change in working capital -198.5 -154.6 -28 Maintenance Capex -126.2 -134.7 +6 Divestments and other 33.5 72.2 -54 Lease payments -59.7 -63.6 +6 Free cash flow 257.5 597.7 -57 Special Capex -145.4 -217.9 +3
Slide 52: Contact / Financial calendar
CONTACT Wienerberger AG Investor Relations Wienerbergerplatz 1, 1100 Vienna wienerberger.com/en/investors investor@wienerberger.com +43 1 60192 10221 FINANCIAL CALENDAR March 25, 2024 Publication of the 2023 Annual Report May 7, 2024 155th Annual General Meeting May 10, 2024 Ex-day for 2023 dividend