Umicore Sa · EURONEXT:UMI
Umicore Sa — Investor Presentation (October 2021)
69 slides from Umicore Sa's investor presentation, October 2021
Slide 1: Umicore Investor Presentation
Umicore Investor Presentation October 2021
Slide 2: Introduction to Umicore
_ umicore materials fer a bette, life duction to Umicore
Slide 3: Who we are
Who we are A global materials technology and recycling group A global leader in automotive A leading supplier of key The world’s leading recycler catalysts for internal materials for rechargeable of complex waste streams combustion engines, hybrids batteries used in electrified containing precious a
Slide 4: Unique position in clean mobility materials
Unique position in clean mobility materials Internal Full Electric Combustion Engine Vehicle Emission control Battery cathode catalysts materials Fuel Cells Plug-in Hybrid Vehicle Electric Vehicle Electro-catalyst and Battery cathode materials battery cathode and emission control materials catalysts
Slide 5: Built on sound foundations
Built on sound foundations A longstanding leader in sustainability Unique business Industry leader in Supportive model sustainability megatrends more stringent resource emission scarcity control recycling electromobility Net Zero GHG. Zero regrets. Endless possibilities. 5
Slide 6: A global leader in recycling
A global leader in recycling Recovering over 20 metals, offering the highest metal yields Our world-class eco-efficient and unique technologies treat residues from over 200 complex waste streams 6
Slide 7: Closing the loop
Closing the loop With a unique integration in the value chain The Umicore Smelters Way & Refiners Non-Ferrous Metals Ore Technology Materials RECYCLING Applications EOL Materials End-user Applications 7
Slide 8: Our mission
Our mission Materials for a better life Over 20 years of sustainability leadership Delivering solutions to tackle pressing societal challenges in clean mobility and circular economy Safeguarding our planet’s precious resources by Setting new industry benchmarks through our reducing the use of primar
Slide 9: Our strategic approach
Our strategic approach is supported by Unique business Early strategic Strong Solid financial model & positioning in commitment structure complementarity the markets to innovation of activities we serve Clear leadership in Setting new industry clean mobility materials standards in sustainability and
Slide 10: Our Group structure
Our Group structure ENERGY & SURFACE CATALYSIS RECYCLING TECHNOLOGIES Automotive Catalysts Rechargeable Battery Materials Precious Metals Refining Precious Metals Chemistry Precious Metals Management Cobalt & Specialty Materials Fuel Cell & Stationary Catalysts Metal Deposition Solutions Jewelry & I
Slide 11: Key figures H1 2021
Key figures H1 2021 Revenues Adjusted EBIT Adjusted EPS R&D spend € 2.1 bn € 625 m € 1.78/share € 118 m 12% 31% 28% 42% 57% 30% Adjusted EBIT Energy & Surface Technologies Revenues Energy & Surface Technologies by Recycling by Recycling Catalysis Catalysis 11
Slide 12: We continue to be a leader in sustainability
We continue to be a leader in sustainability Broader, bolder, faster, better Net Zero GHG emissions by 2035 Zero Zero harm inequality Net Zero GHG. Zero regrets. Endless possibilities. 12
Slide 13: Net zero GHG by 2035
Net zero GHG by 2035 Introducing Umicore 2021 - Public use 13
Slide 14: Our ambitious commitment: net zero GHG scope 1 & 2 emissions by 2035
Our ambitious commitment: net zero GHG scope 1 & 2 emissions by 2035 Net Zero GHG -100% -20% -50% 2019 2025 2030 2035 Baseline 14
Slide 15: Net zero GHG emissions by 2035
Net zero GHG emissions by 2035 Powered by Innovation & strategic Renewable Energy and Carbon Neutral collaboration electricity process efficiency growth 15
Slide 16: Carbon neutral growth
Carbon neutral growth CASE STUDY • Cathode manufacturing: intense scope 2 activity Rechargeable • Availability of low-carbon electricity supply key criteria in Battery Materials selection of location for Umicore’s first cathode production plant in Europe manufacturing plant in Poland: carbon • Use o
Slide 17: Zero harm
Zero harm Introducing Umicore 2021 - Public use 17
Slide 18: Managing our impact with care
Managing our impact with care Continue our commitment to significantly reduce our emissions Net zero GHG emissions by 2035 -20% by 2025, -50% by 2030 -25% diffuse emissions by 2025 (vs 2020) Continuous improvement on metal emissions 18
Slide 19: Caring for safety and wellbeing at work
Caring for safety and wellbeing at work No No work-related occupational injuries excess exposure Mental Social wellbeing wellbeing Physical Occupational wellbeing wellbeing 19
Slide 20: Pioneering approach
Pioneering approach Over 15 years of sustainable & ethical sourcing Umicore was the first company ever to receive third-party validation for its cobalt due diligence practices Co-founding member of the Global Battery Alliance and co-initiator and first contributor to the Fund for the prevention of c
Slide 21: Zero Inequality
Zero Inequality Introducing Umicore 2021 - Public use 21
Slide 22: Diversity of thought to keep us ahead
Diversity of thought to keep us ahead WHERE WE ARE 10,859 WE GO FOR Gender parity in management as Group employees in 2020 TODAY soon as possible with 35% women in 23% management by 2030 Women in management in 2020 Increased non-European representation 20% in management teams by 2025 Non-Europeans i
Slide 23: Introducing Umicore 2021 - Public use
Introducing Umicore 2021 - Public use 23
Slide 24: Business Group Overview: Catalysis
Business Group Overview Catalysis
Slide 25: Catalysis
Catalysis Automotive A world leader in emission control catalysts for light-duty and Catalysts heavy-duty vehicles and for all fuel types. Precious Develops and produces metal-based catalysts used in chemistry, Metals life sciences and pharmaceutical applications. Chemistry Fuel Cells & Combines Umi
Slide 26: Automotive Catalysts: business model
Automotive Catalysts: business model We develop technologies which allow our customers to meet automotive emission legislation at the lowest Total Cost of Ownership Complete catalyst systems Customer to reduce exhaust focus gas emissions People Operational engagement excellence Global manufacturing
Slide 27: Automotive Catalysts Production Footprint
Automotive Catalysts Production Footprint 17 plants in 14 countries, 9 R&D / tech. centers in 7 countries Frederikssund Denmark (closing end Karlskoga Lyngby Nowa Ruda Songdo 2021) Sweden Denmark Poland Korea Onsan Burlington Hanau Korea Canada Germany Tokoname Auburn Hills, MI Florange Japan USA Fr
Slide 28: Auto industry recovering from COVID-19
Auto industry recovering from COVID-19 Monthly global passenger car production across all powertrains (source: IHS & Umicore - 19/07/2021) H1 2021 global 9,000,000 car production 8,000,000 +30% vs H1 2020 7,000,000 H1 21 global car 6,000,000 production still 5,000,000 13% below pre- COVID H1 2019 4,
Slide 29: Catalysis H1 2021 performance
Catalysis H1 2021 performance Revenues +59% and adj. EBIT +853% Automotive Catalysts REVENUES 1,000 Strongly outperforming recovering car market in key regions 800 908 Further market share gains and favorable platform mix in 794 743 600 717 709 652 633 620 LDV, esp. in Europe and China 571 400 Stron
Slide 30: Impressions
Impressions Bad-Säckingen plant AC, Germany Catalyst elements Test bench Installation stationary DNox catalyst Nowa Ruda plant AC, Poland Canned catalyst 30
Slide 31: Catalysis: Unique position in Catalysts
Catalysis Unique position in Catalysts Strong growth drivers: Accelerating demand for Umicore’s catalysts used in fuel cell vehicles. R&D and Increasing uptake of fuel cell drivetrains production capacity in Germany and Korea; and attractive growth opportunities in the hydrogen economy R&D program a
Slide 32: Business Group Overview: Energy & Surface Technologies
Business Group Overview Energy & Surface Technologies
Slide 33: Energy & Surface Technologies
Energy & Surface Technologies Rechargeable A leading cathode material supplier for lithium-ion rechargeable Battery batteries used in electrified vehicles and portable electronics. Also Materials includes battery recycling. Cobalt & Refines and recycles cobalt and nickel; produces cobalt and Special
Slide 34: Rechargeable Battery Materials: business model
Rechargeable Battery Materials: business model Product innovation Process innovation based on strong fuels productivity application know-how improvements while maintaining highest quality standards (stringent Established industrial automotive standards) footprint close to the customer Integrated pro
Slide 35: It takes a lot to play in the automotive league
It takes a lot to play in the automotive league Car OEMs need : High quality cathode materials excellent product quality on 20+ specs • … custom made for different types of xEVs wide spectrum of cathode material technologies • … in massive volumes industrial capabilities • … at the highest speed and
Slide 36: Product, process and supply
Product, process and supply Key success factors 3 Supply 1 Product Technology 2 Process Technology Raw Industrial Lab scale Pilot scale materials scale • Feed flexibility • Ability to scale up fast Wide spectrum of cathode • Cost-efficient processes • Battery recycling material technologies • Indust
Slide 37: Cathode material specs to fulfil cell performance specs
1 Cathode material specs to fulfil cell Product technology performance specs Cathode material Cathode material product specs performance specs • Particle size • Packing • Capacity • Safety • Morphology density • Power • Charge • Composition • Porosity (charge/discharge) efficiency • Purity • Consist
Slide 38: Rechargeable Battery Materials: expansion projects timeline
2 Rechargeable Battery Materials Process technology Expansion projects timeline Year 2016 2017 2018 2019 2020 2021 2022 2023 EUR 160 million announced April 2016 Brownfield in China Greenfield in Korea Completed on accelerated schedule Significant scale effects that EUR 300 million benefitted 2018 m
Slide 39: Access to raw materials
3 Access to raw materials Supply Unique integration in the value chain Raw material Metal Product Application End use Umicore Flexibility in supply feed, high speed to market and responsiveness to customer needs 39
Slide 40: Access to raw materials: battery recycling
3 Access to raw materials Supply Battery recycling as critical additional source of supply • Umicore is fully aligned with OECD Due Diligence for Responsible Supply Chains of Minerals from Conflict-Affected and High-Risk Areas • Certified clean and ethical supply to our customers • Urban mining indi
Slide 41: E&ST H1 2021 performance
E&ST H1 2021 performance Revenues +7% and adj. EBIT +44% REVENUES Rechargeable Battery Materials 700 Substantial increase in cathode materials volumes primarily for 600 650 639 618 607 594 500 557 the European EV market, both YoY and sequentially 495 488 400 398 300 Lower contribution from cobalt re
Slide 42: E&ST H1 2021: Nysa cathode plant commissioning
E&ST H1 2021 Commissioning of cathode materials plant in Nysa, Poland First industrial scale cathode materials production plant in Europe Commissioned end of H1 2021 with initial commercial production volumes expected around year-end Carbon neutral as of start of production with 100% green power sup
Slide 43: Impressions
Impressions EV car battery pack Packaging finished product RBM Cheonan production sites, Korea 43
Slide 44: Unique position in Rechargeable Battery Materials for EVs
Energy & Surface Technologies Unique position in Rechargeable Battery Materials for EVs Electrification confirmed as main avenue to Umicore uniquely positioned to drastically reduce vehicle emissions in mid- address long-term requirements of and long-term this industry, while managing short- Strongl
Slide 45: Business Group Overview: Recycling
Business Group Overview Recycling
Slide 46: Recycling
Recycling Operates the world’s most sophisticated precious metals recycling facility Precious Metals and recovers 17 precious and other valuable metals from complex waste Refining streams. Precious Metals Services for hedging, leasing, purchasing and sale of precious and Management platinum group me
Slide 47: Precious Metal Refining
Precious Metal Refining Largest and most complex precious metals recycling operation in the world Leading refiner of 17 different metals Processes more than 200 different types of raw materials World class environmental and quality standards 47
Slide 48: The value chain of metals
The value chain of metals Ores & Refined New concentrates metals products Smelters Consumers Mines Industry & refiners Complex mining Smelting Complex Complex concentrates & refining production end-of-life & residues residues scrap materials Industrial by-products End-of life materials 4848
Slide 49: Revenue Drivers
Revenue Drivers Main revenue drivers Treatment & refining Metal yield charges Treatment charges are Umicore assumes the risk determined, among other of recovery above or criteria, by the complexity under the contractually of the materials agreed recovery rate 49
Slide 50: Metal price exposure
Metal price exposure Managing the effects of metal price movements Direct: Indirect: on earnings through metal through raw Systematic hedging of yield material availability transactional exposure Depending on market conditions hedging of (part of) structural metal price exposure through contractual
Slide 51: Umicore has unique technology
Umicore has unique technology Umicore is unique due to its proprietary complex flowsheet that combines three metallurgical streams This enables Ability to optimize Flexibility to treat Recovery & Scope to broaden feed and a broad range of valorization of the to new types of therefore input materials
Slide 52: Exceptionally high and volatile precious metals prices, in particular rhodium
Exceptionally high and volatile precious metals prices, in particular rhodium Rhodium (EUR/kg) Palladium (EUR/kg) Silver (EUR/kg) H1 21 price average 800 of € 656,603/kg 800,000 80,000 700 700,000 70,000 600 H1 21 price average of € 706/kg 600,000 60,000 H1 21 price average 500 500,000 of € 69,188/k
Slide 53: Recycling H1 2021 performance
Recycling H1 2021 performance Revenues +48% and adj. EBIT +94% REVENUES Precious Metals Refining 600 652 Record precious metals prices 450 Excellent supply and trading conditions 440 396 300 368 339 327 313 311 300 Strong demand across end-markets and regions 150 Robust operational performance and o
Slide 54: Impressions
Impressions PMR Hoboken recycling plant, Belgium 54
Slide 55: Unique position in Recycling
Recycling Unique position in Recycling Metallurgical leadership and Increasing resource scarcity and need for proprietary technologies for closing the loop treating complex residues and by- products Growing complexity of materials to recycle Increased availability of complex materials, in Closing th
Slide 56: Financial review H1 21
_ umicore materials fer a bette, life Financial review HL 2021
Slide 57: Key figures H1 2021
Key figures H1 2021 REVENUES Adjusted EBIT Free Operating Cash Flow € 656 m € 2.1 bn € 625 m Net debt at € 1,040 m +37% YoY +157% YoY Net debt / LTM Adj. EBITDA 0.87x Adjusted NET PROFIT Adjusted EBITDA CAPEX € 166 m (Group share) € 762 m € 428 m +103% YoY Adjusted EPS € 1.78 ROCE 28.4% Interim divi
Slide 58: Outstanding Adj. EBIT(DA) and margins
Outstanding Adj. EBIT(DA) and margins Driven by demand recovery and exceptional metal price environment Adj. EBIT & Adj. EBIT margin 700 28.6% 0.3 Adjusted EBIT at € 625 million, up 157% compared 600 to H1 20, which was severely impacted by COVID- 0.25 625 500 17.2% 15.2% 15.9% 14.3% 15.3% 0.2 400 1
Slide 59: Full P&L
Full P&L Million € H1 2020 H1 2021 Adjusted EBIT 243 625 Substantial increase in Adj. net - Net finance cost (45) (52) Group result and Adj. EPS, reflecting strong Adj. EBIT - Adjusted Tax (47) (140) increase Adjusted net result 151 433 - Minorities (3) (5) Increase in adjusted net financial cost du
Slide 60: Net cash flow bridge
Net cash flow bridge million € 900 800 Free operating cashflow of 180 € 656 million, including € 30 700 million working capital 600 836 72 22 reduction, driving a € 374m decrease in reported net 500 120 656 39 financial debt 400 29 300 374 200 Combined cash out of 100 € 214 million related to net in
Slide 61: Free operating cash flow at record level
Free operating cash flow at record level million €, continued operations only 1000 836 800 Cash flow from operations after changes in 806 600 437 347 359 working capital tripled to a record € 836 400 308 330 200 363 298 327 million 102 241 275 30 10 0 -200 -10 -89 -72 -32 Decrease in cash working ca
Slide 62: Adjustments to EBIT
Adjustments to EBIT million € H1 2020 H2 2020 H1 2021 - € 39 million EBIT adjustments : • Additional Hoboken green zone Restructuring-related (31) (97) (10) provision of € 41 million Selected asset-impairments (31) (14) (17) • - € 24 million adjustment related (1) Million € (55) to closure of HDD pl
Slide 63: Outlook
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Slide 64: Guidance for full year 2021 slightly revised
Guidance for full year 2021 slightly revised Umicore revises slightly its full year 2021 outlook and now expects adjusted EBIT to approach € 1 billion. This compares to the previous expectation of adjusted EBIT slightly exceeding € 1 billion as communicated on 30 July and reflects the recent decline
Slide 65: Guidance for full year 2021 slightly revised
Guidance for full year 2021 slightly revised CATALYSIS ENERGY & SURFACE RECYCLING TECHNOLOGIES 2021 adj. EBIT expected to more 2021 adj. EBIT expected to grow 2021 adj. EBIT expected to reach than double compared to 20201 meaningfully and expected to be in line exceptional levels, well above last wi
Slide 66: Key Investment Considerations
Key Investment Considerations
Slide 67: Key investment considerations
Key investment considerations • Record earnings in 2020 despite challenging market context due to COVID-19, demonstrating the merits of the strategy building on complementary activities • Well positioned to take advantage of accelerating global megatrends : more stringent emission control, electrifi
Slide 68: Forward-looking statements
Forward-looking statements This presentation contains forward- Should one or more of these risks, looking information that involves risks uncertainties or contingencies materialize, and uncertainties, including statements or should any underlying assumptions about Umicore’s plans, objectives, prove
Slide 69: Umicore
. umicore materials fr a better, life