Solvay Sa · EURONEXT:SOLB

Solvay Sa — Investor Day (2013)

17 slides from Solvay Sa's investor day presentation, 2013

  1. Slide 1: Converting our vision into value

    Converting our vision into value Karim Hajjar

  2. Slide 2: Converting our vision into value: levers and targets by 2016

    Converting our vision into value Levers Targets BY 2016  REBITDA to reach € 2.3bn- € 2.5bn Operational & commercial excellence Portfolio strategic management  CFROI to increase by over 100 bp vs 2013 More selective investments Robust financial framework  Two-thirds of our business assets in value

  3. Slide 3: REBITDA expansion outperforming market growth

    REBITDA expansion outperforming market growth REBITDA in mEUR 2,300 - 2,500 250 280 90 (260) 300 1,650 OEE / Commercial excellence Excellence: €670m >10% CAGR 2013e Chemlogics Inflation Operational Organic Growth Innovation Portfolio 2016e 2013 Excellence At constant scope 3

  4. Slide 4: Enhanced quality of earnings across segments

    Enhanced quality of earnings across segments REBITDA in mEUR Restored 2,300 - 2,500 Mid-single profitability digit Functional Corporate Polymers and Energy Performance Chemicals Advanced Materials 1,650 Consumer Chemicals >10% CAGR 2013e Chemlogics 2016e 2013 At constant scope 4

  5. Slide 5: Earnings quality and earnings growth combined with margin expansion

    Earnings quality and earnings growth combined with margin expansion REBITDA breakdown by operating segment* ~60% of Group portfolio ~50% 2012* of Group portfolio 2016* 23% 20% 18% MARGIN EXPANSION 16.6% Group Group IMPROVED EARNINGS QUALITY margin margin 7% 24% % represent Operating Segments Consume

  6. Slide 6: Unlocking our value

    Unlocking our value CFROI vs. REBITDA margin Premium Premium WACC return WACC return 2012 REBITDA margin 2016 REBITDA margin 30% 30% 20% 20% CFROI UP 100 BP 18% MARGIN 10% 10% 1/3rd of total assets 2/3rd of total assets 0% 0% 0% 6% 12% 18% 0% 6% 12% 18% CFROI 2012 Bubble Size Indicates REBITDA (EUR

  7. Slide 7: Balanced cash allocation

    Balanced cash allocation From To Strategic coherence Returns Risk More profit Investing for value Efficient balance sheet Affordability Timing Rewarding Stakeholders Portfolio management Sustainability 7

  8. Slide 8: Disciplined capital investment

    Disciplined capital investment 2013-2016 Total Capex Capex in € million ~800 700 - 800 Growth Engines 1/3 Resilient and cyclical 2/3  Capital discipline  Strategic coherence 2013-2016 Growth Capex  IRR ≥ 15%  Timing Asia 30% America 50% Europe 20% 2011-2012 2013-2016e average average 8

  9. Slide 9: Focused investments for value growth

    Focused investments for value growth Continued focus on returns Specialty surfactants HDS* HDS* Compounds Guar PVDF PVDF HDS* Alkoxylation Vanillin Surfactant Hydrogen peroxide PEEK Bicarbonate Alkoxylation Consumer Chemicals Advanced Materials Performance Chemicals 9 * HDS: High Dispersible Silica

  10. Slide 10: Maintain best-in-class working capital

    Maintain best-in-class working capital Industrial Working Capital / Total Sales % of Total Sales 14.6% 13.9% 13.6% 12.9% Target ~ 13% 2011 2012 2013e 2014-2016e At current perimeter (Chlorovinyls discontinued) As reported (Incl Chlorovinyls) 10

  11. Slide 11: A sound platform for growth

    A sound platform for growth September 2013 figures (Proforma Hybrid and Chemlogics) Capital Structure Ratios strengthened (in € billion) Solvay + 7.8 Solvay prior Chemlogics + Hybrid to Hybrid bond Hybrid bond bond 1.2 Gearing 22% 17% (Net Debt/Equity) 3.6 3.6 Including pensions: 63% 54% Bilateral N

  12. Slide 12: Actively managing our capital structure

    Actively managing our capital structure Maturity breakdown of debt Rhodia high-yield bonds 1st calls in 1,000 2014 / 2015, respectively In € million 800 HY 700 500 500 500 Hybrid Hybrid 300 Hybrid HY 2013 2014 2015 2016 2018 2019 2020 2023 Strong liquidity position In € million 2,110 1,975 1,875 Tot

  13. Slide 13: Sustainable shareholder rewards

    Sustainable shareholder rewards Solvay’s gross dividend (€/share) Committed to 3,5 3.20 stable / growing dividend 3,0 2,5 CAGR >5% 2,0 1,5  Gradual dividend increase: CAGR>5% 1,0 0,5  Best-in-class among 0,0 peer group 1982 1987 1992 1997 2002 2007 2012 over more than 30 years 40% average pay out

  14. Slide 14: Increasing value for all stakeholders

    Converting vision into value  Earnings quality Focusing on excellence More profitable Making the right portfolio choices Less volatile Sweating our assets Sustainable growth Demanding returns  Improving cash returns / asset efficiency Increasing value for all stakeholders 14

  15. Slide 15: Appendix

    SOLVAY asking more from chemistry” hs. Appendix

  16. Slide 16: Additional financial indications

    Additional financial indications Depreciation and amortization  Excl. PPA impact ~ € 590m in 2013 and ~ € 680m beyond  PPA impact: ~ € 150m in 2013 and ~ € 110m beyond Average cost of gross debt: 5.3% in 2013 and 4.9% from 2014 Other financial expenses  Employee benefits (IAS-19) liabilities disc

  17. Slide 17: Pension situation

    Pension situation Gross Net In € billion In € billion United Kingdom France & Germany € (1.4) bn France & Germany United Kingdom € (1.7) bn € (1.6) bn € (0.4) bn (unfunded pension schemes) Total Total pension pension provision Other countries provision Other countries € (0.1) bn € (0.3) bn € (4.4) b

Solvay — Investor Day (2013) on 6ix