Bekaert SA · EURONEXT:BEKB
Bekaert SA — FY2004 Earnings Presentation
45 slides from Bekaert SA's earnings presentation, Mar 17, 2005
Slide 1: Results 2004
Results 2004 Brussels, 17 March 2005
Slide 2: Address by Baron Paul Buysse, Chairman of the Board
2 Address by Baron Paul Buysse, Chairman of the Board of Directors IR050317 RESULTS 2004 - p2/56 March 2005
Slide 3: Dividend proposal
3 Dividend proposal Strong performance in 2004 and confidence in the future Gross dividend proposal of € 1.875 per share, an increase with 7% Bekaert’s 125th anniversary in 2005 Proposal for exceptional increase of € 0.125 per share IR050317 RESULTS 2004 - p3/56 March 2005
Slide 4: Dividend
4 Dividend € Gross dividend 2.2 2.0 Bekaert’s + 0.125 125th anniversary 1.875 1.8 1.748 1.680 1.6 1.4 2002 2003 2004 IR050317 RESULTS 2004 - p4/56 March 2005
Slide 5: Address by Julien De Wilde, Chief Executive Officer
5 Address by Julien De Wilde Chief Executive Officer IR050317 RESULTS 2004 - p5/56 March 2005
Slide 6: Content
6 Content Highlights Sales Segment reporting • Advanced wire products • Fencing systems Europe • Advanced materials • Advanced coatings Profitability Balance sheet Cash flow Dividend Events after balance sheet date Outlook IR050317 RESULTS 2004 - p6/56 March 2005
Slide 7: Highlights 2004
7 Highlights 2004 Record year, with exceptional market conditions Continuing volatility on the raw material markets, which translated into higher selling prices but uninterrupted supplies to customers Substantial volume growth and reinforced market positions in most activities Further streamlining o
Slide 8: Highlights 2004
8 Highlights 2004 Sales up 21 %, with strong organic growth across all business segments and regions Result from operations: € 185 million, compared to € 112 million (*) Net result: € 168 million, compared to € 87 million EPS: € 7.6, compared to € 3.9 Proposed gross dividend per share € 1.875 (+ 7%)
Slide 9: Sales 2004
9 Sales 2004 in millions of € 3144 2810 3500 2618 3000 971 2500 947 821 2000 1500 1000 2173 1863 1797 500 0 2002 2003 2004 Consolidated Joint ventures and associated companies IR050317 RESULTS 2004 - p9/56 March 2005
Slide 10: Sales by business segment
10 Sales by business segment Consolidated sales Combined sales in millions of € Variance in millions of € Variance Advanced wire products 1 500 + 20.9 % 2 411 + 21.3 % Fencing systems Europe* 453 + 18.4 % 454 + 18.6 % Advanced materials 117 + 13.0 % 117 + 13.0 % Advanced coatings 127 + 12.8 % 127 +
Slide 11: Sales by geographical area
11 Sales by geographical area Consolidated sales Combined sales in millions of € Variance in millions of € Variance Europe 1 273 + 21.0 % 1 350 + 18.9 % North America 587 + 21.4 % 641 + 16.8 % Latin America 31 + 39.4 % 847 + 26.2 % Asia 242 + 15.0 % 249 + 16.0 % Rest of the world 40 + 40.6 % 57 + 20
Slide 12: Advanced wire products: sales
12 Advanced wire products: sales Advanced wire products : +21% wire Europe + 17% wire North America + 22% wire Latin America + 32% wire Asia + 49% building products + 20% steel cord China + 1% steel cord others + 21% other advanced wire products + 2% IR050317 RESULTS 2004 - p12/56 March 2005
Slide 13: Advanced wire products
13 Advanced wire products Very good year Significant progress in consolidating the market positions in Europe and North America Strong performance in Latin America, with good economic climate Worldwide demand for steel cord products for tire reinforcement was especially strong Growth slowed temporar
Slide 14: Advanced wire products: sales
14 Advanced wire products : sales in millions of € 2800 2400 911 2000 845 747 1600 1200 1500 800 1246 1241 400 0 2002 2003 2004 Consolidated Companies Joint ventures and associated companies IR050317 RESULTS 2004 - p14/56 March 2005
Slide 15: Advanced wire products
15 Advanced wire products Combined sales per activity platform other advanced wire products wire Europe 4% 16% steel cord wire North others America 29% 10% steel cord China 5% building wire Latin products America 5% 30% wire Asia 1% IR050317 RESULTS 2004 - p15/56 March 2005
Slide 16: Advanced wire products: financials
16 Advanced wire products : financials in millions of € 2004 2003 Sales 1 500 1 241 EBIT before non-recurring 185 124 Non-recurring events -4 -3 EBIT 181 121 EBIT margin 12.0 % 9.8 % Depreciation & amortisation 77 85 EBITDA 259 206 EBITDA margin 17.3 % 16.6 % Average capital employed 885 830 ROCE 20
Slide 17: Fencing systems Europe: sales
17 Fencing systems Europe* : sales Strong season 2004 Substantial volume growth in the industrial fences Further expansion of the project business (*) The business segment fencing systems Europe consists of the companies involved in the sales transaction completed on 1 March 2005 , i.e. Bekaert Fenc
Slide 18: Fencing systems Europe: sales
18 Fencing systems Europe : sales in millions of € 500 79 1 2 400 300 423 453 382 200 100 0 2002 2003 2004 Consolidated companies Joint ventures and associated companies IR050317 RESULTS 2004 - p18/56 March 2005
Slide 19: Fencing systems Europe: financials
19 Fencing systems Europe : financials in millions of € 2004 2003 Sales 453 382 EBIT before non-recurring 52 27 Non-recurring events 0 0 EBIT 52 27 EBIT margin 11.4 % 7.2 % Depreciation & amortisation 15 18 EBITDA 67 45 EBITDA margin 14.7 % 11.7 % Average capital employed 178 176 ROCE 29.0 % 15.6 %
Slide 20: Advanced materials: sales
20 Advanced materials: sales Advanced materials : +13 % fibre technologies +7% combustion technologies +53 % composites - 24 % IR050317 RESULTS 2004 - p20/56 March 2005
Slide 21: Advanced materials
21 Advanced materials Sustained organic growth in fibre technologies and combustion technologies Additional growth in combustion technologies from the acquisition of Solaronics Effect from the withdrawal from composite profiles activities at the end of 2003 IR050317 RESULTS 2004 - p21/56 March 2005
Slide 22: Advanced materials: sales
22 Advanced materials : sales in millions of € 150 117 103 125 97 100 75 50 25 0 2002 2003 2004 Consolidated companies IR050317 RESULTS 2004 - p22/56 March 2005
Slide 23: Advanced materials
23 Advanced materials Combined sales per activity platform Fibre Composites technologies 17% 43% Combustion technologies 40% IR050317 RESULTS 2004 - p23/56 March 2005
Slide 24: Advanced materials: financials
24 Advanced materials : financials in millions of € 2004 2003 Sales 117 103 EBIT before non-recurring 10 9 Non-recurring events -2 -1 EBIT 8 8 EBIT margin 6.5 % 7.5 % Depreciation & amortisation 5 6 EBITDA 15 14 EBITDA margin 12.7 % 13.3 % Average capital employed 72 62 ROCE 10.4 % 12.4 % Capital ex
Slide 25: Advanced coatings: sales
25 Advanced coatings: sales Advanced coatings : +7 % industrial coatings +15 % specialised films +2 % IR050317 RESULTS 2004 - p25/56 March 2005
Slide 26: Advanced coatings
26 Advanced coatings Growing demand in industrial coatings Additional production facility for diamond like coatings was set up in Suzhou (China) for high-quality coatings to moulds used in various industrial applications and several more facilities planned in the coming years Activity level for spec
Slide 27: Advanced coatings: sales
27 Advanced coatings : sales in millions of € 150 7 0 125 6 100 75 127 119 113 50 25 0 2002 2003 2004 Consolidated companies Joint ventures & associated companies IR050317 RESULTS 2004 - p27/56 March 2005
Slide 28: Advanced coatings
28 Advanced coatings Combined sales per activity platform Specialised films Industrial Coatings 53% 47% IR050317 RESULTS 2004 - p28/56 March 2005
Slide 29: Advanced coatings: financials
29 Advanced coatings : financials in millions of € 2004 2003 Sales 127 113 EBIT before non-recurring -2 0 Non-recurring events -6 -2 EBIT -8 -2 EBIT margin -6.1 % -1.9 % Depreciation & amortisation 15 14 EBITDA 13 12 EBITDA margin 10.4 % 10.5 % Average capital employed 144 158 ROCE -5.4 % -1.3 % Cap
Slide 30: EBIT
30 Ebit Ebit/sales in millions of € % 200 199 10 185 9,1 8,5 8 150 6,8 124 122 6,6 112 6 6,2 100 4 64 3,4 50 2 0 0 2002 2003 2004 2002 2003 2004 EBIT Before non-recurring EBIT / sales Before non-recurring IR050317 RESULTS 2004 - p30/56 March 2005
Slide 31: EBIT: currency impact
31 Ebit : currency impact in millions of € Margin on sales 10,0% 250 202 9,00% 9,0% 8,50% 185 € 17 million 8,0% 200 7,0% 6,0% 150 5,0% 4,0% 100 3,0% 2,0% 50 1,0% 0,0% 0 0,5 1 1,5 2 2,5 0 Nominal At constant Nominal At constant IR050317 RESULTS 2004 - p31/56 March 2005
Slide 32: Share in the result of joint ventures
32 Share in the result of joint ventures in millions of € 57 60 50 37 40 30 23 20 10 4,0 3,4 3,2 0 2002 2003 2004 Share in the result Amortisation goodwill IR050317 RESULTS 2004 - p32/56 March 2005
Slide 33: Consolidated net result
33 Consolidated net result in millions of € 200 168 175 150 125 87 100 75 50 25 0 -25 -46 -50 2002 2003 2004 Result IR050317 RESULTS 2004 - p33/56 March 2005
Slide 34: Shareholder Value: ROIC - WACC
34 Shareholder Value: ROIC - WACC 20 15 10 5 0 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 -5 -10 WACC RoIC IR050317 RESULTS 2004 - p34/56 March 2005
Slide 35: Financial structure
35 Financial structure Equity to total assets Net debt to equity (gearing) in millions of € % 2500 2189 100 90 2000 1922 1938 80 70 1500 60 50 45,6 43,6 42,7 43.8 % 1000 41.8 % 43.3 % 40 30 500 20 10 0 0 2002 2003 2004 2002 2003 2004 Total balance Equity to total assets IR050317 RESULTS 2004 - p35/5
Slide 36: Capital expenditure
36 Capital expenditure Depreciation & amortisation in millions of € in millions of € 250 198 200 169 168 200 196 149 150 166 132 127 150 140 119 100 109 100 78 49 50 39 37 50 41 31 30 0 0 2002 2003 2004 2002 2003 2004 Consolidated Consolidated J.V. & associated companies J.V. & Associated companies
Slide 37: Working capital
37 Working capital in millions of € % on sales 800 30 700 25 600 20,7 19,6 18,6 20 500 400 15 300 10 351 354 453 200 5 100 0 0 2002 2003 2004 Working capital Average working capital on sales IR050317 RESULTS 2004 - p37/56 March 2005
Slide 38: Return on capital employed
38 Return on capital employed ROCE Asset rotation 15 2 14.3 1,70 1,40 1,40 1,5 10 9.0 1 5 4.7 0,5 0 0 2002 2003 2004 2002 2003 2004 ROCE Sales/capital employed IR050317 RESULTS 2004 - p38/56 March 2005
Slide 39: Return on equity
39 Return on equity Earnings per share % € 25 10 8,06 7,65 8 20 20,1 6 4,39 15 3,92 4 10 11,5 2 0 5 -1,40 -2 -2,09 0 2002 2003 2004 -4 2002 2003 2004 -4,4 -5 EPS EPS before goodwill R.O.E. IR050317 RESULTS 2004 - p39/56 March 2005
Slide 40: Cash flow (net)
40 Cash flow (net) in millions of € 350 307 300 224 250 205 200 150 100 50 0 2002 2003 2004 Cash flow IR050317 RESULTS 2004 - p40/56 March 2005
Slide 41: Cash flow (EBITDA)
41 Cash flow (EBITDA) EBITDA/sales in millions of € % 25 350 317 300 20 239 250 225 14.6 15 13.3 12.1 200 10 150 100 5 50 0 2002 2003 2004 0 2002 2003 2004 -5 EBITDA EBITDA/sales IR050317 RESULTS 2004 - p41/56 March 2005
Slide 42: Dividend
42 Dividend Gross dividend Dividend yield Dividend yield € Share price (31.12) % Share price (average) % 2.2 100 5 100 5 90 4.5 90 4.5 4.2 3.9 4.0 80 4 80 4 125th anniversary 3.7 2.0 3.5 3.4 70 3.5 + 0.125 70 3.5 1.875 60 58.75 3 60 3 50.5 50.06 1.8 50 2.5 50 2.5 1.748 45.57 43.15 41.22 1.680 40 2 4
Slide 43: Events after balance sheet date
43 Events after balance sheet date Impact discontinuing operations Fencing systems Europe 12 January 2005: Bekaert sold the shares in Bekaert Fencing NV to Gilde 1 March 2005: sale of Bekaert Fencing NV completed Enterprise value: € 281.5 million Fencing systems Europe generated a combined sales of
Slide 44: Outlook
44 Outlook Sale of Bekaert Fencing NV and its subsidiaries completed Sustainable profitable growth in 2005: - further improve performance - support growth by targeted R&D and investments After an exceptionally strong financial year 2004, Bekaert made a good start in 2005 IR050317 RESULTS 2004 - p44/
Slide 45: Bekaert
® BEKAERT