Bekaert Sa · EURONEXT:BEKB
Bekaert Sa — Investor Day (May 2021)
55 slides from Bekaert Sa's investor day presentation, May 28, 2021
Slide 1: Bekaert Capital Markets Day
Bekaert Capital Markets Day 28 May 2021
Slide 2: Safe harbor
Safe harbor This presentation may contain forward-looking statements. Such statements reflect the current views of management regarding future events, and involve known and unknown risks, uncertainties and other factors that may cause actual results to be materially different from any future results
Slide 3: Welcome
Welcome Jürgen Tinggren – Chairman of the Board of Directors
Slide 4: Today's agenda
Today’s agenda 1 2 3 4 5 Adapting to Driving value Strategic Guiding for Q&A a new world creation transformation growth 4
Slide 5: Introducing Team Bekaert for today's agenda
Introducing Team Bekaert for today’s agenda 1 2 3 4 5 Adapting to Driving value Strategic Guiding for Q&A a new world creation transformation growth Jürgen Tinggren Oswald Schmid Juan Carlos Alonso Taoufiq Boussaid Team Chairman CEO CSO CFO Bekaert 5
Slide 6: Adapting to a new world
1 2 3 4 5 Adapting to Driving value Strategic Guiding for Q&A a new world creation transformation growth 6
Slide 7: Who we are
Who we are BEKAERT AT A GLANCE WHAT SETS US APART Preferred partner serving customers Innovative products and solutions for customers in 120 countries across a wide range of industries Global leader in steel wire transformation and Technology leader with coating technologies 1800 patents and patent
Slide 8: Adapting to a new world - megatrends create opportunities and drive growth
Adapting to a new world - megatrends create opportunities and drive growth Implications and opportunities for Bekaert • Overall positive market outlook • Leverage position to capture growth opportunities • Enhance offering with new, innovative products • Digitalize the business to enhance competitiv
Slide 9: Adapting to a new world - moving to capture opportunities
Adapting to a new world - moving to capture opportunities Focus areas for Bekaert New mobility • light-weight, smart and green materials for tires • advanced cords for vertical city requirements Urbanization • smart glazing solutions with thin fiber technologies • low-carbon concrete reinforcement R
Slide 10: Repositioning Bekaert toward more value and growth
Repositioning Bekaert toward more value and growth Realizing the full potential of the core business We PERFORM! Active portfolio management and selective M&A Transformation through innovation and moving beyond the core We TRANSFORM! Embracing sustainability as a value creating opportunity
Slide 11: Driving value creation
1 2 3 4 5 Adapting to Driving value Strategic Guiding for Q&A a new world creation transformation growth 11
Slide 12: Driving value creation
Driving value creation Oswald Schmid - CEO
Slide 13: 2020 results
2020 results Solid profit growth and strengthened balance sheet Consolidated Sales uEBIT% Operating FCF Working Capital Net Debt in m€ margin on sales in m€ in m€ in m€ -13% +1.6ppt +8.2% -23% -38% FY 2019 FY2020 FY 2019 FY2020 FY 2019 FY2020 FY 2019 FY2020 FY 2019 FY2020 € 3 772 m 7.2% € 449 m € 53
Slide 14: Four business units serving global markets with a broad offering
Four business units serving global markets with a broad offering Overview sales 2020 Business Units Regions End markets RR SWS APAC EMEA Tire & Automotive Construction Agriculture 43% 36% 39% 27% 44% 19% 9% BBRG SB LATAM NAM Basic materials Energy & utilities Equipment Consumer goods 11% 10% 18% 16%
Slide 15: Preferred partner
Preferred partner in the most challenging projects Gotthard Hywind Tampen 15
Slide 16: Preferred partner
Preferred partner in the most challenging projects Big Carl Lightweight & green 16
Slide 17: Highlights of 2020
Highlights of 2020 • Health and Safety • Early, rigorous measures to limit infection risks • Good progress in safety performance • Protecting our business and our company • Successful self-help measures • Effective supply chain actions and customer interactions • Ensuring the liquidity • Emerging st
Slide 18: Bekaert Group Executive
Bekaert Group Executive Leading with a shared ambition Oswald Schmid CEO Stijn Vanneste Arnaud Lesschaeve Curd Vandekerckhove Yves Kerstens Divisional CEO Divisional CEO Divisional CEO Divisional CEO Steel Wire Solutions Rubber Reinforcement Bridon-Bekaert Ropes Group Specialty Businesses Chief Oper
Slide 19: Creating sustainable value for all our stakeholders
Creating sustainable value for all our stakeholders We make our We are truly We commit to We care for customers succeed better together high performance the world around us For our customers, employees, shareholders and communities 19
Slide 20: Focusing on our imperatives
Focusing on our 3 imperatives We TRANSFORM! We GROW! We PERFORM! 20
Slide 21: We Perform! Unlocking our full potential
We Perform! Unlocking our full potential Strong on execution, we deliver on our objectives We PERFORM Commercial excellence Supply chain optimization Operational excellence Leadership & accountability Intensified customer Supply chain continuity Footprint adjustments Health & safety centrici
Slide 22: We Perform! Strong on execution
We Perform! Strong on execution We PERFORM Footprint adjustments Enhancements Effective turnaround Shelbyville Slovakia • Portfolio improvements Pointe-Claire Romania • Cost savings Ingelmunster India • Structural improvements with lasting effects Diamond Wire China Vietnam • Profit restoration prog
Slide 23: We Transform!
We Transform! Strengthening our portfolio and building capabilities to drive value creation We TRANSFORM Portfolio Organizational Digital Innovation Sustainability management capabilities • Invest for growth • Leadership • Operations • Continuous • Clear commitment to: improvement • Scale-up • Perfo
Slide 24: We transform our business portfolio
We transform our business portfolio Strategic Scale-Up Invest for Growth 2020 Sales EBITDA Market Attractiveness 2025E Sales EBITDA • Clear mandates • Strong targets set for mid-term performance • Differentiated capital and resource Turn-around or exit allocation Bekaert’s Ability to Win 24
Slide 25: Actively managing our portfolio to improve our growth potential and returns
Actively managing our portfolio to improve our growth potential and returns Strategic Scale-Up Invest for Growth Dramix® concrete RR Vietnam Synthetic mooring line reinforcement Exit Profit restoration 25
Slide 26: We Grow!
We Grow! Enable sustainable, value creating growth We GROW Megatrends Focus on key markets Leadership positions Moving beyond the core • New mobility • Mobility • Partner of choice • Closer to the end customer • Renewable energy • Construction & infrastructure • Technology competences • Differentiat
Slide 27: Organic Growth might be complemented by value-creating M&A
Organic Growth might be complemented by value-creating M&A Focus on 5 key markets Developing a pipeline Strengthen capabilities Develop Go adjacencies downstream Reinforcing the core Move into services Mobility Lifting and Agriculture • Synergies hoisting • Higher value-added products and solutions
Slide 28: Focus and priorities of 2021
Focus and priorities of 2021 Focus on H&S and the wellbeing of our employees Capture growth opportunity and gain market share Ensure hassle-free supply chain Stringent capital allocation governance Further development and deployment of our strategic transformation: o Innovation o Sustainab
Slide 29: Strategic transformation
1 2 3 4 5 Adapting to Driving value Strategic Guiding for Q&A a new world creation transformation growth 29
Slide 30: Strategic transformation
Strategic transformation Juan Carlos Alonso - CSO
Slide 31: Bekaert is on the move: our strategic transformation journey
Bekaert is on the move: our strategic transformation journey Optimize and focus Transform for sustainable value innovation Active portfolio Focus on 5 management key markets sustainability digital Create a strong base for growth to realize our ambition 31
Slide 32: Transforming for sustainable value
Transforming for sustainable value Innovation Beyond products to new solutions and services Beyond existing markets and applications to new growing sub-markets Sustainability Digital Beyond better performance to more Beyond digital working to data sustainable outcomes intelligence and smart solution
Slide 33: Our three transformation pillars reinforce each other
Our three transformation pillars reinforce each other Sustainable innovations Smart wires and solutions Re-engineering for better New business models to access environmental footprint value creating growth Digitally-enabled sustainability levers for process optimization, energy efficiency, workforce
Slide 34: Illustration where innovation meets digital
Illustration where innovation meets digital Together with VisionTek, BBRG has developed the first mobile 3D rope measuring and visioning equipment to monitor, control, predict and optimize the lifecycle of ropes 34
Slide 35: Innovative solutions to resolve customer needs
Innovative solutions to resolve customer needs Strong investments Rebalancing our pipeline to innovate and increasing our ambition €60M Focused and prioritized Cost and process improvements World-class operations E0 Efficient - accelerate through digital and smart and remote serviced processes T&I I
Slide 36: Bekaert is innovating in major growth markets
Bekaert is innovating in major growth markets Include relevant pictures re: HEM technology, electrolysis, hydrogen New mobility New energy Bekaert invested in Cargo Sous Terrain and is Bekaert participates in a consortium to develop next technology advisor on the Board generation electrolysis for Hy
Slide 37: Sustainability is critical for Bekaert
Sustainability is critical for Bekaert Customers Competitive Advantage • Increasing requirements on suppliers • First mover advantage • Sustainable solutions outgrow others • Significant cost savings • End-industry disruptions • Opportunity to differentiate People & Communities Investors and regulat
Slide 38: Bekaert commits to an ambitious sustainability agenda
Bekaert commits to an ambitious sustainability agenda 2030 AMBITIONS VS. 2019 BASELINE Environmental Social Governance Towards Carbon Neutrality Working conditions Highest Ethical Standards Reduce GHG emissions in line Ethics and Code of Conduct -45% with Science Based Targets 0 Strive for zero acci
Slide 39: We are developing sustainable solutions…
We are developing sustainable solutions… Energy and Utilities Beyond current markets and solutions Digital Twin Synthetic & Strategic Bezinox® Enabling the models hybrid solutions Partnerships cable armoring future 39
Slide 40: … and improve the environmental impact
… and improve the environmental impact Dramix® solutions reducing input intensity SigmaSlabTM, a new Dramix® solution co-developed with post-tensioning leader CCL Heavy, labor-intensive More efficient and easy to use traditional reinforcement steel fiber reinforced concrete Construction Reinforcemen
Slide 41: A Digital Future for Bekaert
A Digital Future for Bekaert Customer Product Process Operation Customer Data-driven Smart Accelerated Enterprise Intelligent End-to-End Experience pricing solutions R&D 2.0 production Supply chain Engagement Advanced Data driven Digital twins Intelligent Intelligent E-buying insights business model
Slide 42: Guiding for growth
1 2 3 4 5 Adapting to Driving value Strategic Guiding for Q&A a new world creation transformation growth 42
Slide 43: Guiding for Growth
Guiding for Growth Short-term and Mid-term financial targets Taoufiq Boussaid - CFO
Slide 44: Sales growth driven by strategic focus and market developments
Sales growth driven by strategic focus and market developments Strategic focus consolidated sales in billions of euro • market positioning • mix improvements • pricing discipline • customer success • operational excellence Market developments • robust growth in target markets • short-cycle incentive
Slide 45: Increased profit from sales growth and stronger business model
Increased profit from sales growth and stronger business model Sales growth underlying EBIT in millions of euro and as a % on sales • in the right markets • with higher-end solutions • with successful customers • at the right price Stronger business model • Improved footprint • structural savings •
Slide 46: Solid cash generation from higher profitability and strong B/S
Solid cash generation from higher profitability and strong B/S net debt on underlying EBITDA Strong B/S • higher profit level • effective working capital control • capital allocation strategy • strong liquidity • strong debt deleveraging • balanced debt maturity 46
Slide 47: Solid cash generation from higher profitability and strong B/S
Solid cash generation from higher profitability and strong B/S Solid cash generation OCF in millions of euro • Objectives: − step up OCF − FCF yield of ~100% • Funding opportunities to grow: − organic and inorganic − investments in innovation, sustainability, digital − dividend 47
Slide 48: Cash flow generation is at the center of our strategy
Cash flow generation is at the center of our strategy Working capital Capital allocation • Decreased by 40% in 2 years (YE 2020 vs YE 2018) • ROCE improved by +50% in 2 years (FY 2020 vs FY 2018) • Average working capital on sales decreased • Objective is to reach a ROCE greater than 20% by from 20%
Slide 49: Value creation in our financial projections 2022-2026
Value creation in our financial projections 2022-2026 Consolidated uEBIT FCF Net debt sales margin yield leverage Mid-term targets 3%+ CAGR 8-10% ~100% < 1.5 (2022-2026) organic through the cycle FCF/net result net debt/uEBITDA Capital Market Day 28 May 2021 49
Slide 50: Value creation in our financial projections 2021-2026
Value creation in our financial projections 2021-2026 Consolidated uEBIT FCF Net debt sales margin yield leverage Mid-term targets 3%+ CAGR 8-10% ~100% < 1.5 (2022-2026) organic through the cycle FCF/net result net debt/uEBITDA Restated short-term € 4.4 bln 80 bps < 1.0 guidance (2021) above FY2
Slide 51: Closing Words
Closing Words Oswald Schmid - CEO
Slide 52: Transforming at speed
Transforming at speed Performing customer-centric, ambitious, and committed to deliver Transforming modern, digitalized company, building a better future Growing Better positioned, focused and innovative 52
Slide 53: Creativity Beyond Steel
Transforming at speed CREATIVITY BEYOND STEEL 53
Slide 54: Q&A-sessie
Q&A-sessie Moderator: Katelijn Bohez, VP Investor Relations & External Communications
Slide 55: @ BEKAERT
@ BEKAERT