Kemira Oyj · OMXHEX:KEMIRA
Kemira Oyj — Shareholder Meeting (March 2014)
21 slides from Kemira Oyj's shareholder meeting presentation, Mar 24, 2014
Slide 1: Delivering a profitable water pure-play
Wolfgang Büchele, President and CEO | March 24, 2014 Kemira’s Annual General Meeting 2014 Delivering a profitable water pure-play
Slide 2: 3% organic growth with improved profitability
3% organic growth with improved profitability January-December 2013 • Revenue EUR 2,229.1 million (2,240.9) – Organic revenue growth 3%, driven by increased sales volumes – Currency exchange -2% – Divestments -2% • Operative EBIT increased 6% to EUR 164.2 million (155.5) – Operative EBIT margin impr
Slide 3: Kemira – global EUR 2.2 billion chemicals company (2013)
Kemira – global EUR 2.2 billion chemicals company (2013) Manufacturing South America footprint globally Revenue: (59 sites): EUR 160 million (7%) 20 multipurpose, Personnel: 237 30 coagulants, 9 commodity chemicals Multipurpose Coagulants Commodity chemicals Yanzhou North America EMEA APAC Revenue:
Slide 4: Transformation into a water pure-play is now accomplished
Transformation into a water pure-play is now accomplished New Performance Acquisition of organization management Sharpened 3F and BASF’s AKD structure system strategy Soto emulsion acquisition business Fit for Growth Q2 2012 AGM 2014 Result JV Sachtleben Coagulants Formic Divestments business in Bra
Slide 5: Profitability and balance sheet have been the main focus in the strategy implementation until the end of 2013
Profitability and balance sheet have been the main focus in the strategy implementation until the end of 2013 2.8 Revenue, EUR billion 4.3 2.2 Net debt / EBITDA 1.8 2008 2009 2010 2011 2012 2013 5
Slide 6: Strategy sharpened in four key areas in April 2013
Strategy sharpened in four key areas in April 2013 We focus on We target pulp & paper, oil & gas, mining and 1 2 above-the-market growth water treatment BUSINESS GROWTH We leverage mature We invest in markets and expand in selected emerging 3 4 innovation, expertise markets GEOGRAPHY INNOVATION (kno
Slide 7: Focus on paper, oil & gas, mining and water treatment
Focus on paper, oil & gas, mining and water Kemira in the value chain of WQQM* treatment Expertise and tailored combinations of chemicals for water- intensive industries Improving our customers’ water, energy and raw material efficiency *) Water Quality and Quantity Management 7
Slide 8: Managing businesses from their regions of growth
Managing businesses from their regions of growth Oil & Mining management based Kemira head office in in Houston, US Helsinki, Finland Municipal & Industrial Paper management management based in based in Frankfurt, Germany Hong Kong, China 8
Slide 9: Revenue growth accelerated in Paper
Revenue growth accelerated in Paper Sales volumes growth in all regions Margin improved to 8.7% (7.7%) in 2013 Paper revenue growth trend year-on-year and operative EBIT EUR million % 25 12% 20 8% 8% 15 7% 6% 6% 5% 5% 4% 10 3% 0% 5 -3% 0 -4% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2012 2013 9
Slide 10: Oil & Mining revenue recovering
Oil & Mining revenue recovering 3F acquisition and higher polymer sales volumes, especially in the NAFTA region Oil, gas and mining customer destocking as well as low 3F result were reasons for decreased operative EBIT in Q4 2013 Oil & Mining revenue growth trend year-on-year and operative EBIT EUR
Slide 11: Strategic initiatives impacting revenue in Municipal & Industrial
Strategic initiatives impacting revenue in Municipal & Industrial Operative EBIT margin improved each quarter in 2013 compared to 2012 Improved product mix in EMEA and NAFTA Profitability Aluminum and iron coagulant businesses in Brazil divested in Q4 2013 Municipal & Industrial revenue growth trend
Slide 12: Leverage mature markets and expand selectively in emerging markets
Leverage mature markets and expand selectively in emerging markets 30% 57% Paper, M&I, O&M Paper, O&M and M&I 6% Paper (China and Indonesia) 7% O&M O&M and Pulp (Middle East and Africa) 12
Slide 13: Capital allocation focusing on high growth product lines
Capital allocation focusing on high growth product lines 3F and Soto acquisitions Nanjing process chemicals site for fast growing markets in China Innovation driven revenue* increased to approximately EUR 160 million (106) in 2013 Capex split average Capex split in 2013 R&D projects in scale up phas
Slide 14: Innovation revenue target EUR 250 million in 2016
Innovation revenue target EUR 250 million in 2016 Targeting to double innovation revenue from 5% in 2012 to ~10% of total sales in 2016 Kemira innovation revenue*, EUR million New innovation areas 180 160 160 Next Fennobind generation 140 120 106 Tagged antiscalants 100 Guar replacement 80 60 Green
Slide 15: Building a culture of innovation throughout the organization
Building a culture of innovation throughout the organization Innovation Community to inspire people, to stimulate creativity and to create enablers for an innovation culture Training to enhance innovation capabilities Create measurable success criteria for innovation work 15
Slide 16: Divested businesses impacting revenue by approximately EUR 200 million in 2014
Divested businesses impacting revenue by approximately EUR 200 million in 2014 In total, divested businesses had a dilutive impact on Kemira’s operative EBIT in 2013 • Organic acids for food and pharmaceuticals industries in Netherlands • The marginal product lines in Denmark and Romania • Iron and
Slide 17: Acquisitions expected to contribute to growth target
Acquisitions expected to contribute to growth target • 41% gearing in 2013 means over EUR 200 million headroom against the targeted <60% gearing • Strict M&A criteria for focused growth – Must strengthen our market position and/or our technologies/competencies – EBIT accretive in second full year af
Slide 18: Outlook for 2014
Outlook for 2014 Financial targets for 2016 unchanged 2013 2014 2016 Revenue EUR 2,229 million 0%-5% organic growth* Operative EBIT EUR 164.2 million increase 5%-15% Revenue EUR 2,229 million EUR 2.6 – 2.7 billion Operative EBITDA margin 11.3% 15% Gearing 41% below 60% *) Revenue growth in local cur
Slide 19: Board of Directors proposes EUR 0.53 (0.53) dividend to shareholders at the AGM
Board of Directors proposes EUR 0.53 (0.53) dividend to shareholders at the AGM Dividend amounts to EUR 81 million, 76% of the operative net profit Kemira’s dividend policy is to pay out 40%-60% of the operative net profit 0.60 8.0% 0.53 0.50 6.0% 0.40 4.4% 0.30 4.0% 0.20 2.0% 0.10 0.00 0.0% 2006 20
Slide 20: Key enablers for performance culture in place
Key enablers for performance culture in place 2017-2020 Best-in-class in its ability to Be recognized as industry and technology Expand leverage global performance leader in selected target markets culture, talents and operations 2015-2017 Build a strong employer brand to attract Grow through new pr
Slide 21: Where water meets chemistry
- ¢ Where water ~ meets chemistry” " é oi, Kemifa mt r . =.