Umicore Sa · EURONEXT:UMI
Umicore Sa — Investor Presentation (June 2021)
71 slides from Umicore Sa's investor presentation, June 2021
Slide 1: Umicore Investor Presentation
Umicore Investor Presentation June 2021
Slide 2: Introduction to Umicore
_ umicore materials fer a bette, life duction to Umicore
Slide 3: We are a global materials technology and recycling group
We are a global materials technology and recycling group One of three global A leading supplier of key The world’s leading leaders in emission control materials for rechargeable recycler of complex waste catalysts for light-duty and batteries used in electrified streams containing heavy-duty vehicle
Slide 4: With a unique position in clean mobility materials and recycling
With a unique position in clean mobility materials and recycling Internal Plug-In Hybrid Combustion Engine Electric Vehicle Umicore provides: Umicore provides: Emission control catalysts Battery cathode materials and emission control catalysts Full Electric Vehicle Fuel cells Umicore provides: Umico
Slide 5: Built on sound foundations
Built on sound foundations Supportive Unique business Industry leader in megatrends & model sustainability legislation resource scarcity more stringent emission control electrification recycling recycling of the automobile We help improve air quality, make electrified transport possible and tackle r
Slide 6: Unique position in Automotive Catalysts
Unique position in Automotive Catalysts CATALYSIS Strong growth drivers: Umicore best positioned to Tightening emission norms for capture growth in growing LDV and HDD, in particular in gasoline segment; technology China, Europe and India leader in cGPF platforms in China and Europe Significant valu
Slide 7: Unique position in Rechargeable Battery Materials for xEV
Unique position in Rechargeable Battery Energy & Surface Materials for xEV Technologies Electrification confirmed as main avenue to drastically reduce vehicle emissions in mid- and Umicore uniquely positioned to address long-term long-term requirements of this industry, while managing short-term flu
Slide 8: Unique position in Recycling
Unique position in Recycling RECYCLING Metallurgical leadership and proprietary technologies for Increasing resource scarcity and need for closing the treating complex residues and by- loop products Growing complexity of materials to recycle Closing the loop Increased availability of complex materia
Slide 9: A focused Group structure
A focused Group structure CATALYSIS ENERGY & SURFACE RECYCLING TECHNOLOGIES Automotive Catalysts Rechargeable Battery Materials Precious Metals Refining Precious Metals Chemistry Cobalt & Specialty Materials Jewelry & Industrial Metals Fuel Cells & Stationary Catalysts Metal Deposition Solutions Pre
Slide 10: With a robust financial performance and a global presence
With a robust financial performance and a global presence Key figures (FY 2020) Adj. Revenues EBITDA € 3.2 bn € 804 m Adj. EBIT ROCE € 536 m 12.1% REVENUES BY GEOGRAPHY* Europe Clean North America mobility and R&D recycling 7% of South America 77% of revenues revenues Asia-Pacific Africa *
Slide 11: Umicore's strategy - Horizon 2020
Umicore’s strategy - Horizon 2020
Slide 12: Horizon 2020 as presented in 2015… successfully delivered
Horizon 2020 as presented in 2015… successfully delivered Clear leadership in Turned sustainability clean mobility into a greater materials and competitive edge recycling Rebalanced the Doubled the size of portfolio & earnings the business in terms contributions of earnings 12
Slide 13: Clear leadership in clean mobility & recycling
Clear leadership in clean mobility & recycling A leap forward over the Horizon 2020 timespan CATALYSIS ENERGY & SURFACE RECYCLING TECHNOLOGIES Strong market share gains in LDV Record €1.1bn investments in cathode Successful ramp-up of new capacity gasoline applications, in particular in materials ex
Slide 14: Double the earnings
Double the earnings Objective achieved in 2018, 2 years ahead of target ADJUSTED EBIT* Million of Euros 600 500 Record adjusted EBIT in 2020 400 Adj. EBITDA* steadily growing from € 405m in 2014 to € 804m in 2020 300 514 536 200 Average ROCE 15%+ target: 255 Steady ROCE increase through 2018; 100 av
Slide 15: A focused and balanced portfolio
A focused and balanced portfolio Through simplification and targeted investments Divestment of Complemented with selected acquisitions and investments, non-core activities to focus on clean mobility & recycling 2016: sale of Zinc CLEAN MOBILITY Chemicals • Haldor Topsoe and Ordeg acquisitions 2017:
Slide 16: Sustainability is in our DNA
Sustainability is in our DNA Value chain and society 77% 75% 72% Gold & silver certified conflict-free by LBMA 2020 67% 2019 Responsible custody/sourcing certified by 2018 RJC for platinum, palladium & rhodium 2017 Founder of Global Battery Alliance (GBA) 2016 REVENUES FROM Promotor of Battery Passp
Slide 17: Sustainability is in our DNA
Sustainability is in our DNA Eco-efficiency 64% -59% -67% -17% Metal Metal Energy emissions emissions consumption* 36% to air* to water* *vs 2015 benchmark 64% Secondary & end-of-life materials 38 energy efficiency projects at 36% Primary materials 26 sites accounting for 95% of our energy consumpti
Slide 18: Sustainability is in our DNA
Sustainability is in our DNA Great place to work Very high retention rate at 96% globally 2% 12% Increased focus on Diversity & Inclusion with: 56% • 30% of managers recruited being women in 2020 WORKFORCE • Increase of women in management roles and in senior management BY REGION positions (23% and
Slide 19: We see it as our mission to be an industry leader in sustainability
._ © umicore We see it as our mission to be an industry leader in sustainability
Slide 20: Let's go for zero
Let’s go for zero The new strategy builds NetZero on 20 years of GHG emissions by 2035 achievements. Our new ambitions are truly bold. We are raising the bar, both for ourselves and our industry. Zero Zero harm inequality Net Zero GHG. Zero regrets. Endless possibilities. 20
Slide 21: Net Zero Zero Zero
-20% GHG emissions by 2025 -50% GHG emissions by 2030 vs. 2019 Switch to renewable energy Full disclosure on environmental impact Continued process, materials & energy efficiency Net Zero 100% GHG emissions by 2035 Carbon neutral growth sustainable supply -25% Sustainability-linked remuneration at d
Slide 22: 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 -100% GHG -20% -50% 2019 2025 2030 2035 Baseline 792 kTon CO2e Scope 3 GHG emissions reduction target in 2022 for SBT validation of our Net Zero GHG ambitions 22
Slide 23: Governance
Governance ESG Committee Supervisory Board ESG on the agenda of both the Management Board Reporting & overview and the Supervisory Board Internal advisory body convened by the Management Board to coordinate and support the ESG ambitions Management Board Chaired by the ESG Communications Director bri
Slide 24: Governance
Governance Supporting our ambitions and increasing disclosure INCREASED ESG 1 TRANSPARENCY 3 RISKS • ESG governance • Pursuing SBTi validation of our Net • Sustainability-linked remuneration Zero approach • Support TCFD and begin working on an alignment for Umicore • Defining ambitions and targets o
Slide 25: Maximizing positive impact
Maximizing positive impact Sustainability at Umicore is not only about minimizing Net Zero the impact of our industrial GHG emissions by 2035 operations, but first and foremost about creating a positive impact on society by harnessing all our capabilities and bringing solutions to address key societ
Slide 26: Business Group Overview: Catalysis
Business Group Overview Catalysis
Slide 27: 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 28: 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 29: 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 30: Catalysis – major milestones in 2020
Catalysis – major milestones in 2020 Sustained investments Ramp-up of new plant in product and for fuel cell catalysts process innovation in Korea Capacity expansions Rationalization of to support growth of production footprint and Automotive Catalysts in savings in LDV and HDD in China manufacturin
Slide 31: COVID-19 outbreak: significant impact on automotive industry
COVID-19 outbreak: significant impact on automotive industry FY 2020 YoY evolution of passenger car production across all powertrains (source: IHS & Umicore - 31/12/2020) China Europe North America Global market 21% 16% 20% 12% 9% 6% 5% 5% 3% 3% 3% 3% 1% 6% 3% 3% 1% 3% -1% -2% -2% -2% -4% -6% -5% -8
Slide 32: Catalysis FY 2020 performance
Catalysis FY 2020 performance Revenues -7% and Adj. EBIT -17%; reflecting severe impact from the pandemic in H1 REVENUES 1,360 1,460 1,364 1,500 1,253 1,163 Automotive Catalysts 1,200 743 652 794 900 565 620 Revenue decline much lower than global car market contraction 600 300 598 633 709 717 Dispro
Slide 33: Impressions
Impressions Bad-Säckingen plant AC, Germany Catalyst elements Test bench Installation stationary DNox catalyst Nowa Ruda plant AC, Poland Canned catalyst 33
Slide 34: Business Group Overview: Energy & Surface Technologies
Business Group Overview Energy & Surface Technologies
Slide 35: 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 36: 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 37: 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 38: 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 39: 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 40: 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 41: 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 41
Slide 42: Access to raw materials
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 43: E&ST – major milestones in 2020
E&ST – major milestones in 2020 Push towards electrification Progress with strategic Step-up in R&D Capacity expansions stronger than ever expansion in Europe expenditures Ongoing construction greenfield EU: ambition of zero-emission Ongoing construction of greenfield Higher R&D expenditures plant i
Slide 44: EV battery demand evolution
EV battery demand evolution Evolution global EV LDV battery demand (GWh) Global market 140 120% Global EV battery market in 2020 up 17% to 137 137 GWh, driven by Europe 120 100% 100% 100 Regional differences in demand patterns: 79% 80% 80 60% 60% Little year-on-year growth in China, well 60 below in
Slide 45: E&ST FY 2020 performance
E&ST FY 2020 performance Revenues -15%; Adj. EBIT -59%; severe COVID-19 impact and significant negative operating leverage REVENUES Rechargeable Battery Materials Lower cathode materials revenues: higher NMC volumes for 1,500 1,289 1,225 EVs; lower LCO and ESS volumes 1,250 1,045 1,000 894 Pricing p
Slide 46: Impressions
Impressions EV car battery pack Packaging finished product RBM Cheonan production sites, Korea 46
Slide 47: Business Group Overview: Recycling
Business Group Overview Recycling
Slide 48: 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 49: 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 49
Slide 50: 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 5050
Slide 51: 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 51
Slide 52: 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 53: 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 54: Recycling – major milestones in 2020
Recycling – major milestones in 2020 Leveraging unique Launch of multi-year Continued investments recycling technology investment plan to to sustain and improve to treat high complex, further improve the environmental PGM rich, materials robustness of the performance of the Hoboken operations plant
Slide 55: Recycling FY 2020 performance: metal price environment
Recycling FY 2020 performance An exceptional metal price environment, in particular for rhodium Rhodium (EUR/kg) Palladium (EUR/kg) Gold (EUR/kg) 500,000 100,000 100,000 Historically high and volatile 450,000 +148% 90,000 +12% 90,000 +33% precious and PGM price levels in 400,000 Dec. 2019/2020* 80,0
Slide 56: Recycling FY 2020 performance
Recycling FY 2020 performance Revenues +23%; Adj. EBIT +92%; higher metal prices and to a lesser extent favorable trading conditions and supply mix REVENUES 1,000 836 Precious Metals Recycling 750 641 650 626 681 396 Higher metal prices, particularly for PGMs 500 318 311 300 368 Supportive supply en
Slide 57: Impressions
Impressions PMR Hoboken recycling plant, Belgium 57
Slide 58: Financial review FY 2020
_ umicore materials fer a bette, life Financial review FY 2020
Slide 59: Key figures FY 2020
Key figures FY 2020 REVENUES Adjusted EBIT Free Operating Cash Flow € 167 m (- € 39 m in 2019) € 3.2 bn € 536 m Net debt at € 1,414 m -4% YoY +5% YoY Net debt / LTM Adj. EBITDA 1.76x Adjusted NET PROFIT Adjusted EBITDA CAPEX € 403 m (Group share) € 322 m € 804 m Adjusted EPS € 1.34 Proposed gross an
Slide 60: Record Adj. EBIT(DA) and margins
Record Adj. EBIT(DA) and margins Adj. EBIT & Adj. EBIT margin Record adj. EBIT (€ 536 m) and record adj. EBIT margin 16.3% 800 15.5% 14.8% 16.0% Stellar adj. EBIT growth in Recycling more than offset 13.2% 12.6% 513 536 14.0% decreases in Catalysis and E&ST. 600 509 12.0% 398 10.0% Includes € 24 m h
Slide 61: Pronounced operating leverage effects
Pronounced operating leverage effects 1H 2020 FY 2020 2H 2020 Group (YoY delta in %) 1H 2020 2H 2020 FY 2020 Revenues -4% -3% -4% Adj. EBITDA +5% +8% +7% Adj. EBIT +1% +9% +5% 61
Slide 62: Increase in free operating cash flows
Increase in free operating cash flows million €, continued operations only 1000 800 489 627 707 Cash flow from operations before changes in 603 500 436 444 549 working capital up 13 % at € 707 m 431 213 323 0 13 92 Increase in cash working capital of € 104 m -113 -78 -104 mostly driven by higher PGM
Slide 63: Net cash flow bridge
Net cash flow bridge million € 650 Free operating cashflow of 600 € 168 million resulting in a 550 € 29 million decrease in 500 reported net debt 450 400 350 603 435 € 44 million portion of 300 convertible bond accounted for 250 as equity 200 150 79 100 Dividend cash out of € 60 m 168 56 limited to
Slide 64: Strong funding base
Strong funding base 35.2% 35.0% 31.1% 24.4% 13.8% 1.92 1500 1.76 1.9 1400 1300 1.40 Stable net financial debt of € 1,414 m, 1200 1.19 1.4 1100 slightly below the level of end 2019 1000 Gearing ratio 900 0.9 800 0.56 1443 700 1414 600 0.4 Net debt 500 / Adj. EBITDA Corresponds to robust credit ra
Slide 65: Outlook
:; umicore materials fr a better life Outlook
Slide 66: Q1 2021 Umicore off to a very strong start
Q1 2021 Umicore off to a very strong start Benefiting from soaring precious metal prices, strong demand across businesses and robust operations ENERGY & SURFACE CATALYSIS RECYCLING TECHNOLOGIES Substantially outperformed global Strong growth of cathode Soaring precious metal prices, car market mater
Slide 67: Umicore set for outstanding performance in 2021
Umicore set for outstanding performance in 2021 Umicore expects adjusted EBIT for 2021 to approach € 1 billion based on soaring precious metal prices, strong demand across businesses and robust operations. Compared to 2020, this FY outlook incorporates on a like-for-like basis an exceptional additio
Slide 68: Key Investment Considerations
Key Investment Considerations
Slide 69: 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 70: 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 71: umicore
. umicore materials fr a better, life