Slide 1: Energy Transition Becomes Reality: Strategy Presentation and Full Year 2022 Results
ENERGY TRANSITION BECOMES REALITY Strategy Presentation and Full Year 2022 Results 23rd March 2023 © 2023 De Nora
Slide 2: Agenda
Agenda Speakers: Paolo Dellachà - CEO Matteo Lodrini - CFO Chiara Locati - IR & ESG Manager 2022 Achievements: 2022 Financial Strategy Update ESG Journey Final Q&A Energy Transition Results Review & 2023-2025 Remarks becomes a reality Guidelines © 2023 De Nora
Slide 3: 2022 Delivering, Executing, and Evolving Our Business
2 0 2 2 D E L I V E R I N G , E X E C U T I N G , A N D E V O LV I N G O U R B U S I N E S S E n ergy Tran s i tion b eco mes Real i ty Record set of Results in €24.2m dividend to be line with guidance, proposed for approval at positive Net Cash Position 1 7 the AGM in April Energy Transition Ramp-
Slide 4: Main Results: Strong set of results in line with guidance
2 0 2 2 M A I N R E S U LT S Strong set of Results in line with Guidance STRONG ORGANIC INCREASED ALL-TIME HIGH GROWTH PROFITABILITY BACKLOG €852.8m €190.8m €789.6m Revenue Ebitda Adj €193 Energy Transition +38.5% vs 2021 +50.6% vs 2021 +44.0% vs 2021 +22.8% +180 bps 22.4% margin, +180 bps +22.8% HI
Slide 5: De Nora: Three Divisions One Soul
DE NORA:THREE DIVISIONS ONE SOUL 1 0 0 Ye a rs o f E l e c t r o c h e m i s t r y Electrode Energy Water Technologies Transition Technologies PRODUCTS PRODUCTS PRODUCTS Anodes, Cathodes, Catalytic Coatings Electrochlorination, Disinfection and Electrodes for Alkaline Water Gas Diffusion Electrodes,
Slide 6: Energy Transition Division: The ramp-up has started
ENERGY TRANSITION DIVISION The ramp–up has started Main ongoing Projects under execution (Backlog at 31 Dec 2022 2.2 GW, Completion by 2025) NEOM, Saudi Arabia , Largest H2 Project Globally >2 GW H2 to Green Ammonia 2022 PERFORMANCES H2 Holland Project, Largest H2 Project in Europe 200 MW H2 to E-fu
Slide 7: Electrode and Water Technologies 22 Highlights
E L E C T R O D E A N D WAT E R T E C H N O L O G I E S 2 0 2 2 H I G H L I G H T S Record Performances Riding the Wave of 2022 Markets Momentum ELECTRODE TECHNOLOGIES WAT E R T E C H N O LO G I E S • Confirmed our undisputed global Leadership Position • Confirmed leadership in Pools and competitive
Slide 8: Agenda
Agenda 2022 Achievements: 2022 Financial Strategy Update ESG Journey Final Q&A Energy Transition Results Review & 2023-2025 Remarks becomes a reality Guidelines © 2023 De Nora
Slide 9: FY 2022 Results: Solid Organic Growth, record performances in all divisions
F Y 2 0 2 2 R E S U LT S Solid Organic Growth, record performances in all divisions KEY HIGHLIGHTS Revenues By Geography ELECTRODE TECHNOLOGIES 38.5% YoY Growth Growth was driven by: 4.5X AMS growth YoY 33.1% • Volumes mainly in Chlor-alkali and Electrowinning lines EMEIA 30.7% 31.6% • price increas
Slide 10: All-time-high backlog, providing good visibility on revenue
F Y 2 0 2 2 R E S U LT S All-time-high backlog, providing good visibility on revenue KEY HIGHLIGHTS Backlog as % ~ 10m of next year 56% All-time high backlog at €789.6m, Revenue1 FY 2022 Backlog by +44% YoY Growth +44% YoY Year of Deployment ELECTRODE TECHNOLOGIES Benefits from multi-year contracts,
Slide 11: Continuous focus on cost control
F Y 2 0 2 2 R E S U LT S Continuous focus on cost control KEY HIGHLIGHTS COGS (€m)* SG&A Costs (€m)* Corporate Costs (€m)* COGS in FY 2022 have been in line with FY 2021 relative to sales, confirming De Nora’s ability in As % passing-through raw materials of 63.5% 63.8% 10.6% 9.3% 3.5% 3.1% price in
Slide 12: Premium Profitability with Increasing Margins
F Y 2 0 2 2 R E S U LT S Premium Profitability with Increasing Margins Adj. EBITDA (€m) Adj. EBIT (€m) KEY HIGHLIGHTS EBITDA Adj. Margin % ELECTRODE TECHNOLOGIES Total 20.6% 22.4% Surge in profitability driven by: Water Tech. 15.7% 19.5% EBIT Adj. Margin % • Revenue growth Electrode1 15.2% • Continu
Slide 13: Q4 Review
Q4 REVIEW Revenue Growth Normalization in Electrodes and Water Divisions, R amp - u p i n E n ergy Tran s i ti on KEY HIGHLIGHTS ELECTRODE TECHNOLOGIES €m Q4'21 Q3'22 Q4'22 Q4’22 vs Q4’21 • Revenue in line with Q3 (+5% REVENUES 209.8 206.2 236.2 12.6% YoY) • EBITDA margin decrease mainly ELECTRODE T
Slide 14: Net Working Capital Evolution
F Y 2 0 2 2 R E S U LT S Net Working Capital Evolution KEY HIGHLIGHTS NWC % Sales 41.3% 39.4% 32.9% NWC was €280m in FY 2022 with a lower incidence on revenue (32.9%) vs. 2021 (41.3%) mainly due to: • Improvement of the inventory ratio, led by a reduction of inventories in Q4, also driven by the Ene
Slide 15: Net Cash Financial Position
F Y 2 0 2 2 R E S U LT S Net Cash Financial Position KEY HIGHLIGHTS (€’m) Operating Cash Flow2 in 2022 was positive by ~€115m. IPO Capital Increase led to Cash Neutrality in 9M’22. 0 Q4 Solid Cash Flow from Operating Activities in Q4 led to a Positive Financial position as a result of: • Projects ex
Slide 16: 2023 Guidance
2023 GUIDANCE Consolidation in Electrodes and Water Divisions, further ramp -up in E n ergy Tran s i tion KEY HIGHLIGHTS Revenue increase is driven by Energy Transition. €900- 950m CONSOLIDATED REVENUES 2023E Electrode and Water Technologies, after exceptional 130-150 growth in 2021-2022, to consoli
Slide 17: Agenda
Agenda 2022 Achievements: 2022 Financial Strategy Update ESG Journey Final Q&A Energy Transition Results Review & 2023-2025 Remarks becomes a reality Guidelines © 2023 De Nora
Slide 18: 2022-2025 Strategy Confirmed
2022-2025 STRATEGY CONFIRMED Electrochemistry, Water, Energy: our future for a cleaner World © 2023 De Nora
Slide 19: De Nora: Electrochemistry, Water and Energy: our future for a cleaner world
DE NORA E l e c t r o c h e m i s t r y, Wa t e r a n d E n e r g y : o u r f u t u r e fo r a c l e a n e r w o r l d GROWTH & MARKET POSITIONING • Deliver step-change organic growth driven by energy transition in partnership with the leading players • Evolve our Energy Transition portfolio, target
Slide 20: Trends Supporting Our Growth
TRENDS SUPPORTING OUR GROWTH Un p reced ented o p p o rtu n ities i n E n ergy Tran s i ti on an d S tab l e G row th in Electrode and Water Businesses TRENDS DRIVERS OUR OFFERINGS Climate Change • Infrastructure Electrode > 300 Mton of Green H2 Technologies by 2050 • Energy Efficiency • Upgrades an
Slide 21: De Nora's Assets to Win
DE NORA’S ASSETS TO WIN Unique Positioning in Growing Markets UNDISPUTED GLOBAL TECHNOLOGY CUTTING-EDGE PROPRIETARY LEADER ACROSS ALL BUSINESS TECHNOLOGIES Chlor-alkali, Metal coated Pools & industrial 268 Patent Families 5 R&D Centers 100+ Electronics, Nickel & Electrodes for electrochlorination; w
Slide 22: Energy Transition Strategy: At the core of green hydrogen supply chain
E N E R G Y T R A N S I T I O N S T R AT E G Y At the core of green hydrogen supply chain «To be the key enabler for the green hydrogen revolution, thanks to a diversified portfolio of best-performing electrodes and the readiness of our production capacity.» TECHNOLOGY STRATEGIC BROAD PORTFOLIO MANU
Slide 23: Industrial Scale Green H2 Solutions
INDUSTRIAL SCALE GREEN H2 SOLUTIONS U n i q u e , E f f i c i e n t , R e a d y t o u s e Te c h n o l o g i e s … a n d o n g o i n g i n n o v a t i o n In The Market Under development Services ELECTRODES CELLS ELECTRODES SMALL SIZE OTHER R&D AFTERMARKET FOR AWE FOR AWE FOR FUEL ELECTROLYSERS INIT
Slide 24: Energy Transition Pipeline
ENERGY TRANSITION PIPELINE C o n t i n u o u s l y i n c r e a s i n g p i p e l i n e u p t o 4 4 G W, p r o v i d i n g v i s i b i l i t y f o r future growth BACKLOG ~2.2 GW ~193 m€ HOT DEALS 1 ~3.0 GW • ELECTRODES ~285 m€ • CELL MANUFACTURING ACTIVELY PURSUED • ELECTRODE PACKAGE ~8,0 GW ~760 m€
Slide 25: Expansion of Production Capacity
E X PA N S I O N P R O D U C T I O N C A PA C I T Y With a Best-in-Class capacity in place we focus on readiness and flexibility to market trends Ongoing investments in brown and green field projects AMS EMEIA ASIA • Increase of existing • Strengthen further • Synergic plan of plants’ capacity with
Slide 26: Electrode Technology Strategy
E L E C T R O D E T E C H N O L O G Y S T R AT E G Y Leveraging on our leadership «Continuously safeguard leadership position across products, industries, and geographies by leveraging strengths.» MAINTAIN EXPAND OPERATIONAL INVEST IN TECHNOLOGY LEADERSHIP POSITION SERVICES EXCELLENCE INNOVATION © 2
Slide 27: Water Technology Strategy
WAT E R T E C H N O L O G Y S T R AT E G Y Enhance value proposition «Positioning De Nora for profitable growth through value additions and efficiency enhancements.» MARKET PORTFOLIO OPERATIONAL FUTURE-READY PENETRATION ENHANCHEMENT EXCELLENCE ORGANIZATION © 2023 De Nora
Slide 28: New Financial Targets: Improved profitability forecasts
2 0 2 5 N E W F I N A C I A L S TA R G E T S Improved profitability forecasts DATA DE NORA 2025 NEW TARGETS vs. PREVIOUS TARGETS REVENUES €1,350 - €1,500m €1,500 - €1,700m EBITDA €250 - €280m €230 - €270m MARGIN 18% - 20% 15% - 16% CAGR 2022 - 2025 CAGR 2021- 2025 CAGR 2021 - 2025 REVENUES Electrode
Slide 29: Energy Transition to Drive Further Future Growth
ENERGY TRANSITION TO DRIVE FURTHER FUTURE GROWTH Organic Sales (€m) 25E-30E • Growth expected to 23E-25E continue • Additional market • Confirmed Scale-up based on • Applications and clients strong backlog • Aftermarket services to • Continue to build up a pipeline 500 – 600 ramp-up • Change vs. the
Slide 30: Financial Targets
2 0 2 5 F I N A N C I A L S TA R G E T S ORGANIC SALES (€m) ADJ. EBITDA (€m) NEW TARGETS ORGANIC GROWTH NEW TARGET ADJ PREVIOUS CAGR 2022-2025 CAGR 2021-2025 EBITDA MARGIN TARGETS 18%-20% 15%-16% €500 - €600m €500-€600 m 16%-17% 10%+ 2%- 4% 9%-11% 16%-18% 16% - 20% In line with 473 24%-26% 2021 24%
Slide 31: Agenda
Agenda 2022 Achievements: 2022 Financial Strategy Update ESG Journey Final Q&A Energy Transition Results Review & 2023-2025 Remarks becomes a reality Guidelines © 2023 De Nora
Slide 32: Sustainability at the Core of Our Business
S U S TA I N A B I L I T Y AT T H E C O R E O F O U R B U S I N E S S SUSTAINABILITY IS OUR BUSINESS MODEL Our offerings are aligned with the UN Sustainable Development Goals Delivery of energy savings for our customers Providing reliable, Green H2 sustainable, cost-effective solutions for water tre
Slide 33: 2022 ESG KPIs & Performances
2022 ESG KPIs & PERFORMANCES Our Journey Continues… ONGOING PROJECTS 8GWh Solar Renewable Energy by 1.3 E -24% -25% 39% GWh 2025 in 12 sites Carbon Intensity Energy Intensity Waste Recycled Installed UN EN ISO 14001 (Scope 1 and 2) Photovoltaic Panels all plants certified by in German Factory 2025 D
Slide 34: Agenda
Agenda 2022 Achievements: 2022 Financial Strategy Update ESG Journey Final Q&A Energy Transition Results Review & 2023-2025 Remarks becomes a reality Guidelines © 2023 De Nora
Slide 35: Final Remarks
FINAL REMARKS • Record set of results in 2022, in line with guidance, driven by the leading position of the Group in all divisions and strong market momentum • Solid Financial Structure thanks to cash flow generation from operations • Ramp-Up of Energy Transition Division, with early-than-expected p
Slide 36: Additional Materials
Additional Materials © 2023 De Nora
Slide 37: Income Statements
I N C O M E S TAT E M E N T S (€m) FY 2021 FY 2022 Q1 2021 Q1 2022 Q2 2021 Q2 2022 Q3 2021 Q3 2022 Q4 2021 Q4 2022 Revenue 615.9 852.8 111.3 200.1 142.4 210.4 152.4 206.2 209.8 236.2 YoY Growth (%) Change in inventory of finished goods and work in progress 35.3 34.8 11.5 6.8 4.0 7.7 25.4 23.4 (5.5)
Slide 38: Quarterly Revenue and Adj. EBITDA by Division
Q U A R T E R LY R E V E N U E A N D A D J . E B I T D A B Y D I V I S I O N €m Q4 2021 Q1 2022 Q2 2022 Q3 2022 Q4 2022 Electrode Technologies 115.7 109.4 118.5 123.5 122.0 YoY variation 72% 46% 40% 5.4% Water Technologies 89.0 86.2 89.5 75.4 85.6 Revenue YoY variation 85% 51% 20% -3.8% Energy Trans
Slide 39: Income Statement: Focus on EBITDA Adjustments
I N C O M E S TAT E M E N T Focus on EBITDA Adjustments (€m) 2021 YTD 2022 YTD Sales 615.9 852.8 EBITDA 121.2 165.2 Margin (%) 19.7% 19.4% Costs relative DND fire 1.2 - Terminations costs (labor + legal expenses) 0.5 0.5 Costs relative to IPO process 1.2 3.6 Costs relative to M&A, integration, and c
Slide 40: Balance Sheet
BALANCE SHEET (€m) FY 2021 FY 2022 Intangible assets 132.8 131.6 Property, plant and equipment 167.6 184.2 Equity-accounted investees 121.8 122.7 Fixed asset 422.2 438.4 Inventories 233.0 295.5 Contract work in progress, net of advances from customers 12.4 16.4 Trade receivables 140.0 123.4 Trade pa
Slide 41: Cash Flow Statement
C A S H F L O W S TAT E M E N T (€m) FY 2022 FY 2021 EBITDA 165,176 121,206 Losses on the sale of property, plant and equipment and intangible assets 330 1,803 Other non-monetary items 10,672 (3,456) Cash flows generated by operating activities before changes in net working capital 176,177 119,553 C
Slide 42: Disclaimer
DISCLAIMER The content of this presentation has a merely informative and provisional nature and does not constitute a public offer under any applicable legislation or an offer to sell or solicitation of an offer to purchase or subscribe for securities or financial instruments or any advice or recomm