Borregaard Asa · OSL:BRG
Borregaard Asa — Q2 2023 Earnings Presentation
25 slides from Borregaard Asa's earnings presentation, Jul 18, 2023
Slide 1: 2nd Quarter 2023
2nd Quarter 2023 Sarpsborg, 18 July 2023
Slide 2: Agenda
Agenda Per A Sørlie, President & CEO Highlights Business segments Outlook Per Bjarne Lyngstad, CFO Financial performance 2
Slide 3: Highlights – 2nd quarter 2023
Highlights – 2nd quarter 2023 All-time high EBITDA1 NOK 537 million (NOK 445 million) Positive impact from diversified market strategy in BioSolutions Increased sales prices for BioMaterials Increased sales prices and high deliveries in Fine Chemicals Reduced margin and volume for traded v
Slide 4: BioSolutions markets – Q2
BioSolutions markets – Q2 NOK per mtds ‘000 mtds 2022 Average gross sales price1 Sales volume 14 000 2023 13 000 12 402 100 90 86 81 84 11 319 79 12 000 11 104 74 10 479 75 11 000 10 150 9 780 10 000 50 9 000 8 000 25 7 000 6 000 0 Q1'22 Q2'22 Q3'22 Q4'22 Q1'23 Q2'23 Q1 Q2 Q3 Q4 Sales price and sale
Slide 5: BioMaterials markets – Q2
BioMaterials markets – Q2 NOK per mt ‘000 mt 2022 Average gross sales price1 Sales volume 20 000 50 2023 17 551 18 000 16 179 16 449 39,4 40,0 40 36,6 36,8 34,7 36,3 16 000 14 880 13 656 14 000 12 595 30 12 000 20 10 000 10 8 000 6 000 0 Q1'22 Q2'22 Q3'22 Q4'22 Q1'23 Q2'23 Q1 Q2 Q3 Q4 Sales price an
Slide 6: Fine Chemicals markets – Q2
Fine Chemicals markets – Q2 mNOK 2022 Sales revenues – quarter 2023 250 226 198 200 178 168 141 150 118 100 50 0 Q1 Q2 Q3 Q4 Sales revenues include fine chemical intermediates and bioethanol Increased sales prices and high deliveries Strong quarter for bioethanol Improved product mix for fine
Slide 7: Outlook
Outlook BioSolutions The diversified market strategy expected to mitigate effects of a potential recession Total sales volume for 2023 forecast to be slightly below 2022, depending on global economic development and the construction market Sales volume in Q3-23 forecast to be largely in line w
Slide 8: Financial performance Q2-23
Financial performance Q2-23
Slide 9: Borregaard key figures – Q2
Borregaard key figures – Q2 mNOK Operating revenues 2022 mNOK EBITDA1 2022 % EBITDA margin1 2022 2 500 2023 600 30 27,4 2023 2023 24,8 25 500 537 2 000 25,5 24,8 20 23,5 1 963 20,6 445 1 850 400 435 434 1 770 1 752 1 744 1 500 15 400 1 615 364 300 NOK 10 EPS cumulative 1 000 8 Q1 Q2 Q3 Q4 200 8,95 5
Slide 10: BioSolutions key figures – Q2
BioSolutions key figures – Q2 mNOK 2022 Operating revenues 2023 1 000 800 948 995 1098 1087 1007 997 • Revenues -1% below Q2-22 600 • Lower average price and volume 400 200 • Positive FX impact 0 Q1 Q2 Q3 Q4 mNOK 2022 2023 • Higher sales prices 300 250 305 284 • Average price affected by changes in
Slide 11: BioMaterials key figures – Q2
BioMaterials key figures – Q2 mNOK 2022 Operating revenues 700 2023 600 684 661 500 620 • Revenues increased 22% vs Q2-22 400 532 540 558 300 • Higher sales prices 200 • Positive FX impact 100 0 Q1 Q2 Q3 Q4 mNOK 2022 150 2023 125 143 • Increased sales prices 138 EBITDA1 100 127 • Lower energy costs
Slide 12: Fine Chemicals key figures – Q2
Fine Chemicals key figures – Q2 mNOK 2022 Operating revenues 250 2023 200 227 200 • Revenues increased 91% vs Q2-22 150 180 170 100 143 • Increased sales prices and high deliveries 119 50 • Positive FX impact 0 Q1 Q2 Q3 Q4 mNOK 2022 125 2023 • Increased sales prices and high deliveries 100 110 EBITD
Slide 13: Currency impact
Currency impact 2022 mNOK Hedging effects2 on EBITDA1 2023 Borregaard’s currency basket3 20 10 115 113,3 112 0 109 107,4 -3 -20 106 104,6 -23 102,0 -40 103 -34 98,7 100 -60 -48 97 94,7 -65 -80 94 Q1 Q2 Q3 Q4 Q1'22 Q2'22 Q3'22 Q4'22 Q1'23 Q2'23 Net FX EBITDA1 impact ≈80 mNOK vs Q2-22 Includes cha
Slide 14: Cash flow, investments and NIBD
Cash flow, investments and NIBD Increase mNOK Cash flow from operating activities mNOK Investments mNOK NIBD1 change Decrease 300 600 261 2 200 40 74 250 2 100 500 212 2 000 200 324 400 40 1 900 158 1 800 300 150 1 700 147 2218 107 537 84 1 600 200 411 100 81 20 1928 172 1 500 261 312 313 24 25 100
Slide 15: Questions?
Questions? Per A Sørlie, President & CEO Per Bjarne Lyngstad, CFO Please note that you can submit questions online during the webcast 15
Slide 16: Appendix
Appendix
Slide 17: Borregaard – key figures
Borregaard – key figures Amounts in NOK million Q2-23 Q2-22 Change FY-23 FY-22 Change Operating revenues 1 963 1 744 13 % 3 813 3 359 14 % EBITDA 1 537 445 21 % 972 845 15 % Depreciation property, plant and equipment -116 -110 -230 -218 Amortisation intangible assets -2 -1 -3 -2 Other income and exp
Slide 18: Operating revenues and EBITDA per segment
Operating revenues and EBITDA1 per segment Amounts in NOK million Amounts in NOK million Operating revenues Q2-23 Q2-22 Change EBITDA 1 Q2-23 Q2-22 Change Borregaard 1 963 1 744 13 % Borregaard 537 445 21 % BioSolutions 1087 1098 -1 % BioSolutions 284 305 -7 % BioMaterials 661 540 22 % BioMaterials
Slide 19: Cash flow
Cash flow Amounts in NOK million Amounts in NOK million Q2-23 Q2-22 FY-23 FY-22 FY-2022 Profit before taxes 379 322 671 599 1 118 Amortisation, depreciation and impairment charges 118 111 233 220 449 Change in net working capital, etc 19 -221 -174 -602 -658 Dividend/share of profit from JV & associa
Slide 20: Balance sheet
Balance sheet Amounts in NOK million 30.6.2023 31.03.2023 31.12.2022 Assets: Intangible assets 80 82 82 Property, plant and equipment 4 502 4 436 4 371 Right-of-use assets 403 350 345 Other assets 226 217 254 Investments in joint venture/associate company 258 136 142 Non-current assets 5 469 5 221 5
Slide 21: Net financial items & net interest-bearing debt
Net financial items & net interest-bearing debt1 Amounts in NOK million Net financial items Q2-23 Q2-22 FY-23 FY-22 Net interest expenses -35 -16 -64 -29 Currency gain/loss -1 -7 5 -5 Share of profit/-loss from an associate -1 0 -3 -1 Other financial items, net -3 -1 -6 -2 Net financial items -40 -2
Slide 22: Currency hedging strategy
Currency hedging strategy Purpose is to delay effects of currency fluctuations and secure competitiveness Hedging based on expected EBITDA1 impact2 Base hedge: 75%/50% on a rolling basis for 6/9 months for major currencies Extended hedge: 75%/50% of the next 24/36 months if USD and EUR are above
Slide 23: Credit facilities, solidity and debt
Credit facilities, solidity and debt Long-term credit facilities Debt and undrawn facilities • 1,500 mNOK revolving credit facilities, maturity 2025 and 2027, 30.6.2023 margin linked to sustainability targets 4 400 • 500 mNOK 5-year green bonds, maturity 2028 (issued June 2023) 4 000 • 40 mEUR 10-ye
Slide 24: Alternative performance measures
Alternative performance measures In the discussion of the reported operating results, financial position and cash flows, Borregaard refers to certain measures which are not defined by generally accepted accounting principles (GAAP) such as IFRS. Borregaard management makes regular use of these Alter
Slide 25: Important notice
Important notice This presentation is being made only to, and is only directed at, persons to whom such presentation may lawfully be communicated (’relevant persons’). Any person who is not a relevant person should not act or rely on this presentation or any of its contents. This presentation does n