Slide 1: MedCap Forum
HE * Ercros H[_EE- MedCap Forum 30-31 May 2017
Slide 2: Key figures
Key figures
Slide 3: Key notes
Key notes Registered name Ercros, S.A. Tax ID A-08000630 Headquarters Av. Diagonal, 595-595, 08014 Barcelona. Incorporation 1989 merger between ERT and CROS. Share capital 34.23 M€ (87.1% free float) Stock company. Shares quoted on the Spanish stock Social structures exchange. Chlorine derivatives d
Slide 4: Statement of profit and loss
Statement of profit and loss M€ Year 2016 Year 2015 2016/2015 Revenue 619.59 627.21 -1.2% Sale of goods 602.54 618.27 -2.5% Other operating income 4.38 6.37 -31.2% 1 Change in inventory 12.67 2.57 4.9 Expenses -561.34 -594.59 -5.5% Procurements -270.22 -279.41 -3.3% Supplies -101.85 -124.22 -18.0%
Slide 5: Q1 results
Q1 results M€ Q1 2017 Q1 2016 2016/2015 Revenue 172.54 154.92 11.4% Sale of goods 165.36 144.03 14.8% Other operating income 13.02 11.05 21.7% Change in inventory -5.84 -0.16 36.2 Expenses -155.07 -138.97 11.6% Procurements -80.10 -70.23 14.1% Supplies -28.55 -22.74 25.5% Employee expenses -25.93 -
Slide 6: Financial and stock market information
Financial and stock market information 03-31-2017 12-31-2016 12-31-2015 Ebitda 59.771 58.25 32.62 Profit 46.422 45.16 7.24 Equity (M€) 220.09 219.83 175.88 Net financial debt (M€) 94.48 73.46 91.23 Solvency ratio3 1.58 1.26 2.80 Leverage ratio4 0.43 0.33 0.52 Market capitalization (M€) 360.51 209.92
Slide 7: Industrial structure
Industrial structure Division Facilities Products Applications Chlorine Cardona, Flix, Caustic potash Chemical industry derivatives Monzón, Caustic soda General Industry Tarragona, Chlorine Derivatives manufacturing Sabiñánigo, EDC VCM manufacturing Vila-seca I and Hydrochloric acid General Industry
Slide 8: Production facilities
Production facilities Bf! Se €SSO08G8888 @5 $9 SS66CG 098860 00; BIT ee. $ OG 0869096660 G90S59 TTTT TT TT H OSSSESOSOSSS SFOS OHS GOHDS SOHO HVS CTOD O09 O08 008S8G088OH8G800HSHSO COSSSSOSSCOSIHOH OST HS OGISS GOSOSHDSSHHFDEHHHVOOHOSD BSSOSSCS $60090800886006 DSOSBSS ee 00 600 SSOSDEO QSSRGRO @ Pha
Slide 9: Competitive position
Competitive position Spain Europe World Chlorine derivatives Caustic soda 1st 9th - Caustic potash 1st 7th - Sodium hypochlorite 1st 11th - Sodium chlorate 1st 4th - TCCA 1st 1st - PVC 1st 9th - Intermediate chemicals Formaldehyde 1st - - Paraformaldehyde 1st 1st 1st Pentaerythritol 1st 2nd 3th Glue
Slide 10: Sales/ebitda by operating segments
Sales/ebitda by operating segments1 52.9 M€ 9% Ercros Sales Sales (M€) 602.5 Ebitda (M€) 58.3 8.9 M€ 15% Ebitda/sales (%) 9.7 Ebitda 160.6 M€ 16.0 M€ 33.4 M€ 389.0 M€ 27% 28% 57% 64% 16.8% Ebitda/sales Chlorine derivatives 10.0% Intermediate chemicals 8.6% Pharmaceuticals Chlorine derivatives Interm
Slide 11: 2017, a year of changes
2017, a year of changes 2017 is a strategic year for Ercros because : Finalizes the first phase of the Act Plan with : The end of the production of chlorine with mercury technology; Doubling of chlorine production capacity with membrane; and The increase in the marketing of third-party pro
Slide 12: Intermediate chemicals division
Intermediate chemicals division Formaldehyde is the core product of the intermediate chemicals division. 79% of formaldehyde is self-consumed to make derivatives (liquids and solids). Methanol is the main raw material. Variations in the price of methanol are passed on to customers, which preserv
Slide 13: Formaldehyde process scheme
Formaldehyde process scheme 13
Slide 14: Pharmaceuticals division
Pharmaceuticals division The activity of the pharmaceuticals division focuses on the production of APIs from the family of antibiotics to the world's leading laboratories. Exports 90% of sales. With fusidic acid (treatment of severe infections in skin and eyes) and fosfomycins (treatment of hosp
Slide 15: Chlorine derivatives division
Chlorine derivatives division Chlorine is the main common link of this division. Chlorine and caustic soda are obtained at the same production process, from sodium chloride (salt) and electricity. Soda is widely used in industry and its consumption grows 1.5 GDP growth. GDP is 1.5. 1/3 of the
Slide 16: Chlorine-soda process scheme
Chlorine-soda process scheme EDC-VCM-PVC 16
Slide 17: The Act Plan
The Act Plan
Slide 18: The Act Plan
The Act Plan The Act Plan defines Ercros' strategy to deal with the ban on producing chlorine with mercury technology in the European Union, starting on December 11, 2017. Implies investments for a total amount of 63.70 M€, which are being executed according to the planned schedule. The object
Slide 19: Phases
Phases The Act Plan is structured in two phases: The first phase, prior to the cessation of chlorine production with mercury technology, covers the period 2016-2017 and foresees investments by 45.70 million euros. The investments in this phase correspond mainly to the expansion of the capacity o
Slide 20: Planned actions
Planned actions Million euros Facilities Investment Term Increase the capacity of membrane Vila-seca I 31.8 2016-2017 chlorine production Sabiñánigo Increase the capacity to produce Vila-seca I 9.0 2016-2017 chlorinated derivatives1 Replacement of a reactor at Vila-seca II 3.8 2016-2017 the PVC plan
Slide 21: Chlorine production capacity
Chlorine production capacity Final t/year Present situation Act Plan situation Mercury Membrane Capacity Membrane Facilities Total technology technology extension technology Vila-seca I 135,000 55,000 190,000 +65,000 120,000 Flix 78,450 - 78,450 - - Sabiñánigo - 30,000 30,000 +15,000 45,000 213,450
Slide 22: Funding
Funding Ercros has a high capacity of financing with own resources 31-03-2017): Equity: 220.09 M€ Net financial debt (NFD): 94.48 M€ Ebitda (E) of the last 12 month: 59.77 M€ NFD/E: 1.58 times Total investment required: 63.7 M€ Financing of the plan : Actions of the time frame 2016-2
Slide 23: Shareholder remuneration
Shareholder remuneration
Slide 24: With charge to the profits of 2016
With charge to the profits of 2016 The board of directors has proposed to the general shareholders’ meeting1 a total payout of 30%, of which: The 10% corresponds to the payment of a dividend of 0.04 €/share; and The remaining 20%, to the repurchase of 3.12 M treasury shares (2.7% of the share
Slide 25: Remuneration policy 2017-2020 (I)
Remuneration policy 2017-2020 (I) The board of directors will also submit to the board the approval of a Shareholder remuneration policy for the period 2017-2020, which contemplates a total payout that will evolve incrementally to a maximum of: 35% of the 2017 profit; 40% of the 2018 profit;
Slide 26: Remuneration policy 2017-2020 (and II)
Remuneration policy 2017-2020 (and II) As in the remuneration charged to the 2016 profit, the policy contemplates two ways of remunerating the shareholder: The repurchase of shares for amortization; and The payment of a dividend. The repurchase of own shares is the preferred remuneration opt
Slide 27: For further information
For further information: Ercros Av. Diagonal, 593-595 08014 Barcelona Tel.: +34 934 393 009 +34 609 880 630 Fax: +34 934 308 073 E-mail: accionistas@ercros.es www.ercros.es