Slide 1: FY 2016 results
LONG-TERM INVESTOR FY 2016 results March 23, 2017 FY 2016 Results | March 23, 2017 1
Slide 2: BASF Leather Chemical Business to become part of Stahl group
BASF Leather Chemical Business to become part of Stahl group(1) Stahl continues to take part in the consolidation of the global leather chemicals market Consolidates its position especially on the upstream part of the value chain of the leather chemicals market Further improves its cash flow generat
Slide 3: Financial takeaways
Financial takeaways Consolidated sales of €8.3bn, up +7.8% Net income from operations, Group share up +25.9% Net income back to positive in H2 2016 Full year net income negative due to non recurring items in H1 2016 NAV per share on March 10, 2017: €162.0 with a LTV ratio @ 21.1% FY 2016 Results | M
Slide 4: 2016 main milestones; strategic orientation set for 2017-2020
2016 main milestones to accelerate value creation potential Creation of Allied Universal through a megamerger Acquisition of Tsebo, the African leader in facilities management Acquisition of SGI Africa, an African shopping mall pioneer 28 acquisitions made by Group companies Sale of Parcours, €241m
Slide 5: Major developments since the start of 2017
Major developments since the start of 2017 Acquisition of Tsebo closed on February 1, 2017 • €159m invested(1) • ~65% ownership(2) • Capital Group Private Markets invested alongside Wendel (~35%) SGI Africa: 2 new shopping centers to be opened • One in Douala and a second in Abidjan Our companies co
Slide 6: Group companies
Group companies FY 2016 FY 2016 Results | March 23, 2017 6
Slide 7: Bureau Veritas
Bureau Veritas Resilient performance, intact mid-term ambition with timing delayed by one year Full Year 2016: Revenue of €4.55bn, 9 bolt-on acquisitions Organic growth of -0.6%, confirming low growth since mid-2015 Operating margin @ 16.2%, ahead of SGS and Intertek Wendel’s view: Updated strategic
Slide 8: Saint-Gobain
Saint-Gobain Strong progress in results Full Year 2016: Revenue of €39.1bn, growing +2.6% like-for-like Recurring net income +20% Wendel’s view for 2017: Construction rebound in Europe & USA underway Strong automotive market Strengths in HPM & emerging markets still undervalued Sale of 30 million Sa
Slide 9: IHS: Sharp profitable growth in a challenging environment
IHS Sharp profitable growth in a challenging environment Key figures 904.7 2016 highlights +25.1% Revenue, USD million 723.1 Strong sales growth driven by: • Integration of ca. 7,000 towers over the last 18 months • Further development of the existing portfolio EBIT increased by 75% due to strong co
Slide 10: IHS: Nigerian macro environment
IHS Nigerian macro environment Real quarterly Nigerian GDP growth Nigerian macro environment • After political hesitations due to President Buhari’s health, Vice-President Osinbajo stepped in and addressed strategic issues • Nigerian economy shrank 1.5% in 2016 amid a slump in oil revenue, diminishe
Slide 11: IHS: Impact of Nigerian Naira depreciation
IHS Impact of Nigerian Naira depreciation on IHS IHS has natural mid and long term operational IHS monthly revenues (in USD) demonstrate the and financial hedging efficiency of its contracts’ re-indexation NGN devaluation Price reset +20% m.o.m. • A significant portion of IHS’s tower rental contract
Slide 12: Constantia Flexibles: Focus on profitable growth
Constantia Flexibles Focus on profitable growth Key figures +8.6% 2,062.1 FY 2016 highlights Revenue, € million 1,898.7 +8.6% total growth • +1.5% organically, -0.6% FX, +7.7% external • All divisions developed positively: +6.8% for Food, +5.6% for Pharma, and +11.8% for Labels +10.2% EBITDA growth
Slide 13: Stahl: Dynamic volume growth & record margin
Stahl Dynamic volume growth & record margin enable dividends to shareholders Key figures FY 2016 highlights +4.4% Revenue, € million 628.1 655.7 Organic growth +5.6%, boosted by volume growth • +5.6% organic growth, thanks to good volume growth in most divisions. +12.3% organic growth in Performance
Slide 14: Stahl: Strong cash generation delivers outstanding returns
Strong cash generation delivers outstanding returns Wendel’s investment is already highly cash generative Wendel still owns 75.3% (1) of Stahl and will benefit from its €341m received outstanding cash generation profile, thanks to: March 2016 January 2017 April 2014 Stahl acquires Stahl pays Stahl p
Slide 15: BASF leather chemical activities to become part of Stahl group (1/4)
BASF leather chemical activities to become part of Stahl group (1/4) On March 22, 2017, Stahl has signed an agreement to acquire the Leather Chemical assets of BASF SE The transaction will consist of the combination of Stahl with an asset- light industrial scope: Transfer of one production facility
Slide 16: BASF leather chemical activities to become part of Stahl group (2/4)
BASF leather chemical activities to become part of Stahl group (2/4) Consolidating Stahl position on the upstream part of the value chain Raw Materials Beamhouse Wet-End Finishing Beamhouse is the first stage of the Wet-End : Includes processes to Finishing: Enhances the leather leather production p
Slide 17: BASF leather chemical activities to become part of Stahl group (3/4)
BASF leather chemical activities to become part of Stahl group (3/4) Key figures The combination of the two businesses will deliver: ~ €850m of 2016 PF net sales(1) €200m+ of 2016 PF EBITDA(1) ~80% of cash conversion(2) after combination, vs ~75% on a standalone basis Stahl also expects to generate
Slide 18: BASF leather chemical activities to become part of Stahl group (4/4)
BASF Leather Chemical activities to become part of Stahl group (4/4) Shareholding & financing In exchange for the contribution of its assets to Stahl, BASF will receive 16% of the shares of Stahl and cash consideration of ca. €150m(1). Stahl will finance the cash consideration with a mix of own cash
Slide 19: FY 2016 Results | March 23, 2017
FY 2016 Results | March 23, 2017 19
Slide 20: Allied Universal: Successful integration underway
Allied Universal Succesful integration underway (1) Key figures – Pro Forma 2016 highlights 5,074.2 +6.1% 4,823.5 Revenue, USD million 4,545.6 Strong pro forma sales growth driven by: • New business wins and base business growth, partially offset by customer attrition, including from acquisitions co
Slide 21: Cromology: Results impacted by Argentina and France
Cromology Results impacted by Argentinian economic situation and market conditions in France Key figures 2016 highlights 751.9 -1.9% 737.3 Flat organic growth Revenue, €m • Total growth of +0.7% (excl. Argentina) • -0.5% decline in France due to deflationary environment • Continued growth in South E
Slide 22: Oranje-Nassau Développement
Oranje-Nassau Développement Mecatherm Saham Group • Sales at €118.7m, purely organic growth +23.1% due to • All insurance subsidiaries experienced growth in 2016 except favorable base effect Saham Angola Seguros, organic growth of insurance activities +6% • Return to positive EBITDA €13.7m in FY 201
Slide 23: Tsebo illustrates how Wendel invests with third parties
Tsebo illustrates how Wendel invests with third parties €87m (1) invested by Capital Group Private Markets alongside Wendel Wendel contemplates partnering with co-investors on a deal-by-deal basis while keeping strong leadership in the portfolio companies. Wendel also contemplates making deals alone
Slide 24: Wendel financials
Wendel financials FY 2016 FY 2016 Results | March 23, 2017 24
Slide 25: Consolidated sales up +7.8%
Consolidated sales up +7.8% Consolidated sales, in €m Net income from operations, in €m +7.8% +11.8% 8,283.6 7,683.4 516.9 462.2 2015 2016 2 new companies consolidated: • Constantia Flexibles since April 2015 • AlliedBarton since December 2015(1) Mecatherm recovery 2015 2016 Partially offset by: 30m
Slide 26: Net income back to positive in H2 2016
2016 consolidated results Financial & operating 720.2 expenses and taxes Net income back to positive H2 in H2 2016 H1 Non-recurring H2 516.9 income -203.3 H2 Total net income Net income, Group share €-141m €-366.8m H2 H1 H1 172.1 H1 Impact of Total 58.3 goodwill net income allocation Consolidated Ne
Slide 27: 2016 Non-recurring income
2016 Non-recurring income In millions of euros 2015 2016 H1 H2 2016 2016 Loss on sale of Saint-Gobain shares - -229.6 -229.6 - Accounting gain on sale of Parcours (1) - 78.3 78.3 - Bond debt buyback - -123.6 -56.6 -67.1 FX impact on IHS financial debt -56.1 -159.9 -111.8 -48.1 Change in faire value
Slide 28: Debt optimization carried out over the last months
Debt optimization carried out over the last 12 months to take advantage of the low interest rate environment At Wendel level: average cost of bond debt from 4.3% as of Dec. 31, 2015 to <3.0% as of Dec. 31, 2016 May 16 €500m bond Oct. 16 exchangeable into €300m 6.5-year Saint-Gobain shares @0% bond i
Slide 29: Net Asset Value
Net Asset Value as of March 10, 2017 FY 2016 Results | March 23, 2017 29
Slide 30: NAV of €162.0 as of March 10, 2017
NAV of €162.0 as of March 10, 2017 (in millions of euros) Dec. 31, 2016 March 10, 2017 Listed equity investments Number of shares Share price (1) 4,803 4,937 • Bureau Veritas 179.9 million €18.3 3,263 3,297 • Saint-Gobain 35.8 million €45.8 1,540 1,639 Unlisted equity investments & Oranje-Nassau Dév
Slide 31: NAV per share up 6x in 8 years
Value creation Net asset value per share, € NAV per share up 6x in 8 years €162.0 €28.0 12/31/2008 12/31/2009 12/31/2010 12/31/2011 12/31/2012 12/31/2013 12/31/2014 12/31/2015 12/31/2016 3/10/2017 FY 2016 Results | March 23, 2017 31
Slide 32: A diversified geographic & sector exposure
A diversified geographic & sector exposure GEOGRAPHIC EXPOSURE REBALANCED(1) SECTORAL EXPOSURE REBALANCED(1) Health Energy Africa & other 5% 8% Infrastructure 14% & Industry North America Telecom 8% 20% 10% Automotive & Government, transportation Administration 7% & Education Eastern Europe 3% Asia
Slide 33: Dividend growth year after year
Dividend growth year after year +13% CAGR €2.35(2) €2.15 €2.00 €1.85 €1.75 €1.25 €1.30(1) €1.00 2009 2010 2011 2012 2013 2014 2015 2016 (1) Excluding the exceptional distribution of 1 Legrand share for every 50 Wendel shares held (2) Proposed to shareholders at May 18, 2017 AGM FY 2016 Results | Mar
Slide 34: Share buyback / return to shareholders
Share buyback / return to shareholders 2016: €99m in dividends paid 2% of capital cancelled on July 25, 2016 2017: €107m in dividends to be paid on May 26, 2017 Active share buyback to be relaunched from March 27, 2017, to take advantage of steep discount to NAV Since 2012: 4.6 million shares bought
Slide 35: Conclusion
Conclusion FY 2016 Results | March 23, 2017 35
Slide 36: Key takeaways
Key takeaways Good operational results & solid financial structure We continue to grow our companies through transformational transactions & operational improvements High NAV demonstrates strong value creation Shareholder friendly approach with good return to shareholders: dividend growth & share bu
Slide 37: 2017-2020 main targets
2017-2020 main targets DEVELOP & INVEST CRYSTALLIZE VALUE If Wendel invests €3-4bn total equity, Continue to develop our portfolio depending on markets conditions, in companies over the long-term: Europe, Africa, North America & South- DOUBLE-DIGIT TSR • Bureau Veritas East Asia in companies offerin
Slide 38: Q&A
Q&A FY 2016 Results | March 23, 2017 38
Slide 39: Appendix
Appendix FY 2016 Results | March 23, 2017 39
Slide 40: Appendix 1: Group overview
Appendix 1 Group overview FY 2016 Results | March 23, 2017 40
Slide 41: Portfolio structure: Gross asset value €11.1bn
Portfolio structure GROSS ASSET VALUE: €11.1BN Unlisted assets Bureau Veritas Saint-Gobain Cash1 Oranje-Nassau Développement Production, Certification & verification transformation and distribution of building materials 41.2% Equity stake 6.5% Equity stake €4.5bn sales €39.1bn sales €735m Adj. op. p
Slide 42: Portfolio structure – unlisted assets
Portfolio structure – unlisted assets Mobile telephone Flexible packaging High-performance Manufacture & Security services Infrastructure in Africa coatings & leather distribution of paints finishing products • 21.4% Equity stake • 60.5% Equity stake • 75.3% Equity stake • 87.3% Equity stake • 33.2%
Slide 43: Portfolio structure – Oranje-Nassau Développement
Portfolio structure – Oranje-Nassau Développement CSP Technologies exceet Mecatherm High-performance plastics Design of embedded Industrial bakery equipment packaging electronic systems 98.3% 28.4% 98.6% Saham Group Nippon Oil Pump SGI Africa Tsebo Diversified insurance Market leader in Japan for A
Slide 44: Acceleration in portfolio rebalancing toward unlisted assets
Acceleration in portfolio rebalancing toward unlisted assets Gross asset value, in € million Breakdown of gross asset value Unlisted assets up 3.9x in 4 years Listed assets Cash and other diversified assets Unlisted assets 43% 24% 11% March 18, March 16, March 10, 2013 2015 2017 FY 2016 Results | Ma
Slide 45: Double digit annualized shareholder return
Double digit annualized shareholder return Annualized TSR Annualized TSR since June 13, 2002 since January 1, 2009 13.0% 17.6% 7.4% 3.5% Euro Stoxx 50 Wendel Euro Stoxx 50 Wendel total net return total net return Source: FactSet TSR as of 03/10/2017 FY 2016 Results | March 23, 2017 45
Slide 46: So, why invest in Wendel?
So, why invest in Wendel? Undervalued best-in-class portfolio Overall portfolio quality & Diversification Access to African growth Access to unlisted assets & listed assets Long term trend exposure Mega America Africa Europe Trends IPO Assets North Clear and value creating South East Asia TSR Hidden
Slide 47: Appendix 2: Business activity
Appendix 2 Business activity FY 2016 Results | March 23, 2017 47
Slide 48: Bureau Veritas
Bureau Veritas Resilient performance – Mid-term ambition intact, with timing delayed by one year Key figures 4,634.8 -1.8% 2016: a year of transformation 4,549.2 New streamlined organization & reporting Revenue, € million • Leaner Executive Committee with 9 members to support Bureau Veritas’s 2020 s
Slide 49: Saint-Gobain
Saint-Gobain Significant improvement in results across the board -1.3% Key figures 39,623 39,093 +2.6% like-for-like Outlook for 2017 Economic climate • Gradual improvement in France, despite a still Revenue, € million uncertain renovation market • Further growth in other Western European countries,
Slide 50: CSP Technologies
Oranje-Nassau Développement CSP Technologies Solid organic growth & positive impact of Maxwell Chase Key figures +19.0% 126.7 2016 highlights 106.5 Organic growth +4.9% Revenue, $ million • CSP growth driven by Healthcare & Diagnostics segment and penetration of new markets EBIT margin up +520bps 30
Slide 51: Mecatherm
Oranje-Nassau Développement Mecatherm Successful recovery FY 2016 highlights Sales up +23.1% YoY 118.7 Organic growth with +23.1% sales 104.7 96.4 Sales, € million • Favorable accounting comparison base effect vs. 2015 • Unwinding in 2016 of 2015 high level of orders • 2015 revenue hit by industrial
Slide 52: exceet
Oranje-Nassau Développement exceet Refocusing on the electronic and secure solutions activities to enhance growth & returns FY 2016 highlights 136.4 -0.8% Sales down -0.8%, stabilizing since Q2 135.3 Unsatisfactory EBITDA margin (6.0%), but solid basis for improving returns Revenue (1), € million •
Slide 53: Nippon Oil Pump
Oranje-Nassau Développement Nippon Oil Pump Sales growth and profitability level restored Key figures 2016 highlights 5,534 5,363 +3.2% Revenue, ¥ million +4.2% organic growth • Stable growth for the historic Trochoid segment, due in part to a raise in prices • Significant expansion of Vortex sales,
Slide 54: Saham
Oranje-Nassau Développement Saham Good growth in 2016 Insurance: revenues up +7%, of which organic growth Insurance (Saham Finances): Consolidated gross +6%, positive proforma mainly from Continental Re premiums up +7% acquisition (Nigeria) and negative FX effect in Angola in MAD million +7% • Saham
Slide 55: SGI Africa
Oranje-Nassau Développement SGI Africa (since July 2016) Shopping centers development across West and Central Africa €25m invested in SGI Africa in July 2016, and up to Credits: Raymond Djigla €120m over the next few years Wendel and CFAO (over 100 years of presence in Africa and Africa expert) co-c
Slide 56: Tsebo
Oranje-Nassau Développement Tsebo The leading pan-African facilities services provider Wendel invested €159m for a 65%(1) stake in the leading provider of facilities management, cleaning, catering, security and remote camp services in Africa. Capital Group Private Markets invested alongside Wendel f
Slide 57: Appendix 3: Financial information as of December 31, 2016
Appendix 3 Financial information as of December 31, 2016 FY 2016 Results | March 23, 2017 57
Slide 58: FY 2016 consolidated sales
FY 2016 consolidated sales Consolidated sales in millions of euros 2015 2016 Δ Organic Δ Bureau Veritas 4,634.8 4,549.2 -1.8% -0.6% Constantia Flexibles (1) 1,442.0 2,062.1 n.a. +1.5% (2) Cromology 751.9 737.3 -1.9% 0.0% Stahl 628.1 655.7 +4.4% +5.6% Oranje-Nassau Développement (3) 226.6 279.3 +23.3
Slide 59: Sales of equity-accounted companies
FY 2016 consolidated sales Sales of equity-accounted companies in millions of euros 2015 2016 Δ Organic Δ Saint-Gobain (1) 39,623 39,093 -1.3% +2.6% IHS 652.0 817.9 +25.4% n.a. Allied Universal (2) - 1,916.1 n.a. +3.7% (5) Oranje-Nassau Développement 136.4 137.4 +0.7% -0.2% exceet (3) 136.4 135.3 -0
Slide 60: 2016 consolidated results
2016 consolidated results In millions of euros 2015 2016 Δ H1 H2 2016 2016 Consolidated subsidiaries’ contribution 679.5 720.2 +6.0% 365.9 354.3 Financial & operating expenses and taxes -217.3 -203.3 -6.4% -130.3 -73.0 Net income from operations (1) 462.2 516.9 +11.8% 235.6 281.3 Net income from ope
Slide 61: Net income from operations
Net income from operations in millions of euros 2015 2016 Bureau Veritas 432.7 424.7 Stahl 84.4 95.3 Cromology 17.0 17.5 Constantia Flexibles 55.3 67.1 AlliedBarton 3.0 29.8 Allied Universal (equity accounted) - 0.7 Saint-Gobain (equity accounted) 153.2 106.6 IHS (equity accounted) -68.4 -44.5 Oranj
Slide 62: Consolidated income statement
Consolidated income statement (1) In millions of euros 2016 2015 Net sales 8,283.6 7,863.4 Other income from operations 20.9 9.6 Operating expenses -7,484.3 -6,921.2 Net gain (loss) on sale of assets 3.0 -4.1 Asset impairment 1.2 -105.9 Other income and expenses -99.6 -94.3 Operating income 724.8 56
Slide 63: Consolidated balance sheet
Consolidated balance sheet In millions of euros 12/31/2016 12/31/2015 In millions of euros 12/31/2016 12/31/2015 Share capital 188.4 192.0 Goodwill 3,669.3 4,305.0 Premiums 36.3 31.7 Intangible assets, net 2,238.8 2,705.3 Retained earnings & other reserves 2,399.8 2,904.5 Property, plant & equipment
Slide 64: Conversion from accounting presentation to economic presentation
Conversion from accounting presentation to economic presentation Equity-method investments Wendel Bureau Constantia Allied Group (in millions of euros) Cromology Stahl OND holding Veritas Flexibles Barton Saint- Allied total IHS companies Gobain Universal Net income from operations Net sales 4,549.2
Slide 65: Appendix 5: Other financial information
Appendix 5 Other financial information FY 2016 Results | March 23, 2017 65
Slide 66: 2016 main changes in net asset value
2016 main changes in net asset value In millions of euros Net financial 1,113 costs Bond Dividend Holding buyback 135 paid costs Other 7,428 Change in -136 -122 -51 Dividends -99 Bureau Veritas -166 received 6,547 value 99 Change in -72 Change in unlisted assets Saint-Gobain value value NAV as of De
Slide 67: Cash bridge
Cash bridge From March 17, 2016 to March 10, 2017 Dividend from In millions of euros Saint-Gobain Investment 44 2016 bond in SGI 90 @4.875% 344 repayment -99 -36 -25 Dividend from Dividend Share Bureau Veritas paid buyback 500 Merger Allied Bond Universal buyback -644 241 Zero coupon bond 1,155 exch
Slide 68: Bank and bond debt as of December 31, 2016
Bank and bond debt as of December 31, 2016 December 31, 2015 December 31, 2016 In millions of euros Nominal amount Maturity Nominal amount Maturity Bank debt related to Saint-Gobain Undrawn Undrawn Undrawn Dec. 2019/€350m Undrawn Mar. 2020/€500m Undrawn Mar. 2020/€500m Syndicated credit Undrawn Nov.
Slide 69: Financial agenda
Financial agenda FY 2016 Results | March 23, 2017 69
Slide 70: Financial agenda
Financial agenda 5/18/2017 Shareholders' Meeting /publication of NAV and trading update (before Shareholders’ Meeting) Paris - Webcasted 9/7/2017 H1 2017 earnings / Publication of NAV (pre-market release) Web and conference call 11/30/2017 2017 Investor Day / publication of NAV and trading update (p
Slide 71: Disclaimer
Disclaimer • This document has been prepared by Wendel S.E. (“Wendel”) solely for use at the 2016 full-year results presentation, to be held on March 23, 2017. This document must be treated confidentially by attendees at such presentation and may not be reproduced or redistributed to any other perso