Sonae Indústria S.G.P.S — Sonae Indústria — Investor Presentation (September 2009)
58 slides from Sonae Indústria S.G.P.S's investor presentation, September 2009
Slide 1: Sonae Indústria Investor Presentation September 2009
SONAE INDÚSTRIA INVESTOR PRESENTATION September 2009 1
Slide 2: Overview
OVERVIEW MG SONAE i INDUSTRIA
Slide 3: Shareholder Structure
OVERVIEW SONAE INDÚSTRIA SHAREHOLDER STRUCTURE SHAREHOLDER STRUCTURE AT 14th AUGUST 2009 EFANOR FREE FLOAT 51.356% 48.644% Sonae Indústria SGPS 3
Slide 4: One of the largest wood panel producers in the world
OVERVIEW SONAE INDÚSTRIA WE ARE ONE OF THE LARGEST WOOD PANEL PRODUCERS IN THE WORLD. WORLD. WITH 30 PLANTS LOCATED IN 8 COUNTRIES AND SPREAD ACROSS 3 CONTINENTS. CONTINENTS. OUR BUSINESS IS EXCLUSIVELY FOCUSED ON THE PRODUCTION OF WOOD BASED PANELS. PANELS. 4
Slide 5: Our Operations
OVERVIEW SONAE INDÚSTRIA OUR OPERATIONS 5
Slide 6: Our Products
OVERVIEW SONAE INDÚSTRIA OUR PRODUCTS OVER 90% OF OUR RAWBOARD CAPACITY IS TO MANUFACTURE PB & MDF. PB MDF OSB Very versatile Excellent substitute for Suitable for structural and solid wood non-structural applications Suitable for all general in the construction uses in furniture and Ideal for furni
Slide 7: Our Products
OVERVIEW SONAE INDÚSTRIA OUR PRODUCTS WITH VARIOUS APPLICATIONS KITCHEN / OFFICE / HOME FURNITURE CONSTRUCTION FLOORING DECORATION PACKAGING 7
Slide 8: Sales
OVERVIEW SONAE INDÚSTRIA SALES APPROXIMATELY 80% OF OUR SALES ARE GENERATED IN EUROPE (excluding Brazilian operation Figures) SALES BY MARKET SALES BY PRODUCT S.AFRICA PB 7% FLOORING 18% CANADA IBERIAN P. 1% 8% 25% OTHERS T&G 12% 6% UK 5% CTS MDF 10% 18% FRANCE 17% HB 1% GERMANY OSB MF 7% 38% 27% T&
Slide 9: Our History
OVERVIEW SONAE INDÚSTRIA OUR HISTORY Acquisition and SONAE (Sociedade modernization of Nacional de AGLOMA – the largest Estratificados, SARL) domestic Particleboard was established to Starting the producer in Portugal international manufacture decorative High expansion with the Pressure laminates ac
Slide 10: Our History
OVERVIEW SONAE INDÚSTRIA OUR HISTORY SINCE 1993 SONAE INDÚSTRIA’S INSTALLED CAPACITY GREW THROUGH BOTH ACQUISITIONS AND ORGANIC GROWTH. 2005: JV with 2008 and Tarkett 1997: Investment period in 1999- 1999-2004: 2009: (Germany) Greenfield plants in Brazil, Restructure of Glunz Restructuring South Afr
Slide 11: Wood Based Panel Players
OVERVIEW SONAE INDÚSTRIA WOOD BASED PANEL PLAYERS WE ARE ONE OF THE LARGEST GLOBAL MANUFACTURERS OF WOOD BASED PANELS IN EUROPE AND WORLDWIDE EUROPE Thousands of m 3 WORLDWIDE Thousands of m 3 M&P Kaindl (Kronospan) 12.700 M&P Kaindl (Kronospan) 13.300 Sonae Indústria 7.290 Sonae Indústria 8.705 Swi
Slide 12: Capacity Production
OVERVIEW SONAE INDÚSTRIA CAPACITY PRODUCTION TOTAL CAPACITY (RAWBOARD) IS 8.7 MILLION M3, APPROXIMATELY 85% OF WHICH IS LOCATED IN CENTRAL EUROPE. SONAE INDÚSTRIA RAWBOARD CAPACITY Thousands of m 3 6.000 5.500 5.000 460 1.200 4.000 3.000 1.790 2.000 3.840 1.415 500 70 1.000 1.220 1.345 0 Central Eur
Slide 13: Overview Figures
OVERVIEW SONAE INDÚSTRIA OVERVIEW FIGURES FY 2008 CONSOLIDATED TURNOVER OF 1.8 BILLION EUROS RECURRENT EBITDA OF 100 MILLION EUROS, WHICH INCLUDES THE NEGATIVE EFFECT OF AN INCREASE IN CHEMICAL COSTS CLOSE TO 55 MILLION EUROS; MARGIN OF 6% TOTAL EBITDA OF 139 MILLION EUROS TURNOVER & RECURRENT EBITD
Slide 14: Geographical Regions
OVERVIEW SONAE INDÚSTRIA GEOGRAPHICAL REGIONS WITH VARYING LEVELS OF PROFITABILITY BETWEEN OUR 3 MAIN GEOGRAPHICAL REGIONS: TURNOVER & RECURRENT EBITDA TURNOVER & RECURRENT EBITDA TURNOVER & RECURRENT EBITDA IBERIA CENTRAL EUROPE REST OF THE WORLD Millions of Euros 800 Millions of Euros 1.400 Millio
Slide 15: Highlights of 1H09 Results
HIGHLIGHTS OF 1H09 RESULTS 15
Slide 16: Consolidated Operational Review
HIGHLIGHTS OF 1H 2009 RESULTS SONAE INDÚSTRIA CONSOLIDATED OPERATIONAL REVIEW During the 2Q09 and, as expected, business environment remained tough. Nevertheless, we have seen a stabilization of our volumes sold. When compared 1Q09 with 2Q09, we were able to increase our volumes sold in all countrie
Slide 17: Consolidated Operational Review
HIGHLIGHTS OF 1H 2009 RESULTS SONAE INDÚSTRIA CONSOLIDATED OPERATIONAL REVIEW Regarding our restructuring process: Measures to reduce fixed costs already resulted in a decline of 27 million euros when comparing to 1H09 with 1H08 and 3,7 million euros when compared 2Q09 with 1Q09. For the coming quar
Slide 18: Price and Cost Evolution
HIGHLIGHTS OF 1H 2009 RESULTS SONAE INDÚSTRIA PRICE AND COST EVOLUTION CONSOLIDATED QUARTERLY AVERAGE COSTS (eur/m3) BASE 100:2Q07 Chemical costs have 1,3 further decreased 1,1 during this quarter 0,9 0,7 0,5 2Q07 3Q07 4Q07 1Q08 2Q08 3Q08 4Q08 1Q09 2Q09 Wood Chemicals Unfortunately the CONSOLIDATED
Slide 19: Chemicals: Urea and Methanol
HIGHLIGHTS OF 1H 2009 RESULTS SONAE INDÚSTRIA CHEMICALS: UREA AND METHANOL CHEMICAL COSTS HAVE A SIGNIFICANT IMPACT IN OUR COST STRUCTURE (AROUND 35% VARIABLE COSTS) UREA AND METHANOL ARE THE MAIN CHEMICALS USED TO PRODUCE RESINS USED IN OUR PRODUCTION NWE ICIS METHANOL PRICES - Oct. 2003_2009 560 4
Slide 20: Geographic Review of Operations: Iberia
HIGHLIGHTS OF 1H 2009 RESULTS SONAE INDÚSTRIA GEOGRAPHIC REVIEW OF OPERATIONS IBERIA TURNOVER & RECURRENT EBITDA Millions of Euros IBERIA 1Q09 seems to have been the bottom of the crisis in Iberia. 180 30,0% 160 During 2Q09, despite the 140 25,0% negative seasonal effect of the 120 118 20,0% 105 102
Slide 21: Geographic Review of Operations: Central Europe
HIGHLIGHTS OF 1H 2009 RESULTS SONAE INDÚSTRIA GEOGRAPHIC REVIEW OF OPERATIONS CENTRAL EUROPE (Germany, France and the UK) TURNOVER & RECURRENT EBITDA CENTRAL EUROPE Millions of Euros In Germany and France demand is still very weak 350 20,0% 300 Additional volumes from 268 15,0% Eastern countries are
Slide 22: Geographic Review of Operations: Central Europe
HIGHLIGHTS OF 1H 2009 RESULTS SONAE INDÚSTRIA GEOGRAPHIC REVIEW OF OPERATIONS CENTRAL EUROPE (Germany, France and the UK) We will continue our restructuring plan In Germany we have started negotiations with works council for the closure of the Kaisersesch plan. (around 200 FTEs and 350.000 m3 PB) In
Slide 23: Geographic Review of Operations: Rest of the World
HIGHLIGHTS OF 1H 2009 RESULTS SONAE INDÚSTRIA GEOGRAPHIC REVIEW OF OPERATIONS REST OF THE WORLD (Canada, Brazil and South Africa) In Canada, demand is still weak TURNOVER & RECURRENT EBITDA Millions of Euros but we are gaining market REST OF THE WORLD share. Volumes sold increased 65,0% further 12%
Slide 24: Geographic Review of Operations: Brazil
HIGHLIGHTS OF 1H 2009 RESULTS SONAE INDÚSTRIA GEOGRAPHIC REVIEW OF OPERATIONS REST OF THE WORLD (Canada, Brazil and South Africa) Brazil, has been experiencing a resilient demand, when compared to other countries. Nevertheless, the new MDF BRAZIL RAWBOARD CAPACITY PLANS (PB+MDF) Thousands m3 capacit
Slide 25: Consolidated Operational Review
HIGHLIGHTS OF 1H 2009 RESULTS SONAE INDÚSTRIA CONSOLIDATED OPERATIONAL REVIEW When compared 2Q09 with 1Q09, Consolidated Turnover decreased by 6% and volumes sold declined 3%; In 2Q09, Recurrent EBITDA achieved 13 million euros, compared to 6 million in 1Q09 And TOTAL EBITDA in 2Q09 was 9 million eu
Slide 26: Consolidated Financial Review
HIGHLIGHTS OF 1H 2009 RESULTS SONAE INDÚSTRIA CONSOLIDATED FINANCIAL REVIEW The increase in fixed assets this quarter was 7 million Euros, which includes mainly essential investments in maintenance, Health & Safety and Environmental issues We were able to decrease during 2Q09 our Net Debt by 21 mill
Slide 27: Scheduled Loan Repayments
HIGHLIGHTS OF 1H 2009 RESULTS SONAE INDÚSTRIA SCHEDULED LOAN REPAYMENTS SCHEDULED LOAN REPAYMENTS (as of 30th June 2009) 104 0 0 0 168 106 107 105 113 3 72 56 34 3Q09 4Q09 1H10 2H10 2011 2012 2013 2014 >2014 Securitization Refinancing for the 80 million Euros bond issue maturing in October 2009 is c
Slide 28: Profit & Loss Account
HIGHLIGHTS OF 1H 2009 RESULTS SONAE INDÚSTRIA PROFIT & LOSS ACCOUNT (euro millions) 1H08 2008 1Q'09 2Q09 1H09 Turnover 965 1.769 346 325 671 Other Operational Income 77 114 11 14 25 EBITDA 126 139 4 9 13 Recurrent EBITDA 79 100 6 13 19 Recurrent EBITDA Margin % 8,2% 5,7% 1,7% 3,9% 2,8% Depreciation
Slide 29: Balance Sheet
HIGHLIGHTS OF 1H 2009 RESULTS SONAE INDÚSTRIA BALANCE SHEET 1H'08 2008 1Q'09 1H09 Non Current Assets 1.467 1.386 1.384 1.413 Tangible Assets 1.294 1.203 1.198 1.224 Goodwill 95 104 104 107 Deferred Tax 54 54 55 57 Other Non Current Assets 24 26 26 25 Current Assets 694 532 467 440 Inventories 249 19
Slide 30: Looking Forward
LOOKING FORWARD 30
Slide 31: Looking Forward
HIGHLIGHTS OF 1Q 2009 RESULTS SONAE INDÚSTRIA LOOKING FORWARD We expect a slow recovery in the wood base panel industry in the coming quarters Fixed costs should continue to decline, following the implementation of our restructuring program We will continue to study and implement further restructuri
Slide 32: Our Strategy: What We Have Been Doing
OUR STRATEGY WHAT WE HAVE BEEN DOING 32
Slide 33: Adapting Capacity
WHAT WE ARE DOING SONAE INDÚSTRIA ADAPTING CAPACITY WE HAVE BEEN ADAPTING OUR CAPACITY TO THE MARKET DEMAND, BY CLOSING OUR LESS EFFICIENT PLANTS AND/OR LINES 30* * As of 30th June 2009 33
Slide 34: Adapting Capacity
WHAT WE ARE DOING SONAE INDÚSTRIA ADAPTING CAPACITY In total we have already closed/stopped capacity by 1.315.000 m3. 2008 2009 We closed 4 plants: We stopped two lines: Coleraine in the UK – 100.000 m3 PB MDF Line 1 in Meppen – Topan I – 110.000 m3 George in S.A.- 60.000 m3 PB PB Line in Valladolid
Slide 35: Reasons to Sell Our Brazilian Operations
WHAT WE ARE DOING SONAE INDÚSTRIA REASONS TO SELL OUR BRAZILIAN OPERATIONS to strengthen our Balance Sheet BRAZIL RAWBOARD CAPACITY PLANS (PB+MDF) Thousands m3 2,500 8. million m3 2,040 1,750 (2012) 2,000 Capacity has been increasing which 800 400 1,474 1,500 will deteriorate the industry in Brazil
Slide 36: We Sold Our Brazilian Operations
WHAT WE ARE DOING SONAE INDÚSTRIA WE SOLD OUR BRAZILIAN OPERATIONS Total Value of the transaction: 116 million euros Net Debt + contingencies: 43 million euros Enterprise Value: 159 million euros Multiple of 7.8x (adding 60 million euros ICMS to the Enterprise value; with a total last 12 months EDIT
Slide 37: Geographic Review of Operations
GEOGRAPHIC REVIEW OF OPERATIONS 37
Slide 38: Iberia
GEOGRAPHIC REVIEW OF OPERATIONS SONAE INDÚSTRIA IBERIA IBERIA Sonae Indústria Iberian Capacity 3 COMPETITIVE LANDSCAPE Thousands m MDF 500 PB 1,220 HB 70 PARTICLEBOARD MDF FLOORING HARDBOARD HPL CHEMICALS OTHERS (FURNITURE, COMPONENTS, WOOD VENEER) Source: Sonae Indústria (Sept 2009) 38
Slide 39: Iberia Competitive Landscape
GEOGRAPHIC REVIEW OF OPERATIONS SONAE INDÚSTRIA IBERIA IBERIA COMPETITIVE LANDSCAPE PLANTS INSTALLED RAWBOARD CAPACITY IN IBERIA - TOP PLAYERS Millions m3 12 CAPACITY Finsa/Utisa 3.33 1.79 Million m3 CAPACITY UTILIZATION 1H09 Sonae Indústria 1.79 61% Interbon 0.97 Losan 0.38 Tablicia 0.37 Source: So
Slide 40: Central Europe
GEOGRAPHIC REVIEW OF OPERATIONS SONAE INDÚSTRIA CENTRAL EUROPE CENTRAL EUROPE 3 COMPETITIVE LANDSCAPE Sonae Indústria Central Europe Capacity Thousands m MDF 1,200 PB 3,840 OSB 460 UK GERMANY FRANCE PARTICLEBOARD MDF HPL CPL Source: Sonae Indústria (Sept 2009) 40
Slide 41: Central Europe Competitive Landscape
GEOGRAPHIC REVIEW OF OPERATIONS SONAE INDÚSTRIA CENTRAL EUROPE CENTRAL EUROPE COMPETITIVE LANDSCAPE 3 INSTALLED RAWBOARD CAPACITY IN CENTRAL EUROPE - TOP PLAYERS Millions m PLANTS 14 CAPACITY Sonae Indústria 5.50 5,5 Million m3 CAPACITY UTILIZATION 1H09 Egger 3.62 64% Kronospan M&P Kaindl 3.40 Pflei
Slide 42: Rest of the World: North America
GEOGRAPHIC REVIEW OF OPERATIONS SONAE INDÚSTRIA NORTH AMERICA PLANTS REST OF THE WORLD 1 NORTH AMERICA CAPACITY COMPETITIVE LANDSCAPE 0.9 Million m3 CAPACITY UTILIZATION 1H09 64% INSTALLED RAWBOARD CAPACITY IN NORTH AMERICA (PB+MDF) - TOP PLAYERS Millions m3 Flakeboard 2.74 Roseburg 2.44 Temple Inla
Slide 43: Rest of the World: South Africa
GEOGRAPHIC REVIEW OF OPERATIONS SONAE INDÚSTRIA SOUTH AFRICA REST OF THE WORLD SOUTH AFRICA COMPETITIVE LANDSCAPE SOUTH AFRICA CAPACITY 3 Thousands m PB 495 SOUTH MDF AFRICA 70 PARTICLEBOARD MDF Source: Sonae Indústria (Sept 2009) 43
Slide 44: Rest of the World: South Africa
GEOGRAPHIC REVIEW OF OPERATIONS SONAE INDÚSTRIA SOUTH AFRICA REST OF THE WORLD SOUTH AFRICA COMPETITIVE LANDSCAPE INSTALLED RAWBOARD CAPACITY IN SOUTH AFRICA - TOP PLAYERS PLANTS Millions m3 2 CAPACITY 0.57 Million m3 PG Bison 0.71 CAPACITY UTILIZATION 1H09 50% Sonae Indústria 0.57 Source: Sonae Ind
Slide 45: Corporate Governance
CORPORATE GOVERNANCE 45
Slide 46: Board of Directors
CORPORATE GOVERNANCE SONAE INDÚSTRIA BOARD OF DIRECTORS Belmiro de Azevedo [Chairman] BOARD OF Álvaro Cuervo García Paulo Azevedo DIRECTORS Per Knuts Thomas Nystén Carlos Bianchi de Aguiar [CEO] Rui Correia [CFO] Christophe Chambonnet Carlos Bianchi de Aguiar [CEO] EXECUTIVE Rui Correia [CFO] Christ
Slide 47: Board Committees
CORPORATE GOVERNANCE SONAE INDÚSTRIA BOARD COMMITTEES 47
Slide 48: Code of Conduct
CORPORATE GOVERNANCE SONAE INDÚSTRIA CODE OF CONDUCT In 2008, Sonae Indústria implemented a renewed CODE OF CONDUCT, which contains a set of standards based on our shared values that govern the activities of the Sonae Indústria Group; applies to everyone employed by the Group sets out guidance on th
Slide 49: More on Sonae Indústria
MORE ON SONAE INDÚSTRIA 49
Slide 50: Human Resources
MORE ON SONAE INDÚSTRIA SONAE INDÚSTRIA HUMAN RESOURCES Approximately 6.5 thousand Employees at the end of 2008 Number of Employees & Productivity N. Employees 1) Productivity Turnover/Pax BASE 100: 2002 South Africa; The 450 Netherlands; 10,000 195.0 18 181.0 Brazil; 362 Iberia; 2,097 167.0 166.3 8
Slide 51: Sustainability Report of Sonae Indústria
MORE ON SONAE INDÚSTRIA SONAE INDÚSTRIA SUSTAINABILITY SUSTAINABILITY REPORT OF SONAE INDÚSTRIA Strategic formalisation to approach sustainability reporting and process in the coming years Vision, Mission, Values and Principles Code of Conduct Environmental Resources and Efficiency Communication Str
Slide 52: Our Values
MORE ON SONAE INDÚSTRIA SONAE INDÚSTRIA OUR VALUES 52
Slide 53: Sustainable Use of Wood and Recycling
MORE ON SONAE INDÚSTRIA SONAE INDÚSTRIA SUSTAINABLE USE OF WOOD AND RECYCLING Wood- Wood-based panels incorporate a high percentage of sawmill co- co-products and wood residues as raw materials: materials: forestry residues pallets old or used wood based panels old or used furniture 53
Slide 54: Sustainable Use of Wood and Recycling
MORE ON SONAE INDÚSTRIA SONAE INDÚSTRIA SUSTAINABLE USE OF WOOD AND RECYCLING Wood- Wood-based panels play a key role in the sustainable use of forestry resources as they: represent the natural alternative to solid wood, replacing it in an increasing number of applications allow significant dimensio
Slide 55: Prize – Sonae UK: Best Green Companies 2008
MORE ON SONAE INDÚSTRIA SONAE INDÚSTRIA PRIZE – SONAE UK BEST GREEN COMPANIES 2008 PRICE 98% of the wood consumption at the Knowsley plant is recycled. 55
Slide 56: CO2 Emissions Mitigation
MORE ON SONAE INDÚSTRIA SONAE INDÚSTRIA CO2 EMISSIONS MITIGATION Wood- Wood-based panels help to mitigate climate change: forests are a recognised carbon sink (through photosynthesis) forestry products are CARBON STORES wood-based panels are actually long-term carbon stores if used in construction a
Slide 57: Cogeneration (CHP)
MORE ON SONAE INDÚSTRIA SONAE INDÚSTRIA COGENERATION (CHP) Energy is produced in Combined Heat and Power (CHP) plants non-recyclable waste wood (biomass) is used as fuel for thermal energy production to be used in industrial processes surplus heat is used to additional produce electricity to supply
Slide 58: | SONAE
| SONAE INDUSTRIA
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