Orkla Asa · OSL:ORK
Orkla Asa — Jotun Group — Investor Presentation (November 2024)
32 slides from Orkla Asa's investor presentation, Nov 11, 2024
Slide 1: Jotun Group / Orkla investors
Jotun Group / Orkla investors 11 November 2024, Morten Fon
Slide 2: Jotun Protects Property
Jotun Protects Property
Slide 3: Agenda
Agenda • Values • Jotun at a glance • Business update • Financial status • Summary CEO Morten Fon/ Jotun Group/ 11 November 2024 3
Slide 4: Our values
The Penguin Spirit Our values Loyalty Care Respect Boldness 4
Slide 5: Jotun at a glance
Jotun at a glance
Slide 6: Stable ownership structure - a key success factor
Jotun at a glance Stable ownership structure - a key success factor • Stable structure with ~950 shareholders Gleditsch Other family • No equity injections since the merger in 54.0% 42.7% 3.3% 1972 (59.0% of votes) (38.6% of votes) (2.4% of votes) • Prudent and predictable dividend policy − Aim to d
Slide 7: One global parent brand with sub-brands
Jotun at a glance One global parent brand with sub-brands Strong and clear communication across segments 7
Slide 8: Global footprint and diversified business portfolio
Jotun at a glance Global footprint and diversified business portfolio 45 billion NOK sales income +100 countries 40 factories 10 650 people 1 152 million litres of paint sold Jotun 100%, August 2024 12 months rolling 8
Slide 9: Long term strategy
Jotun at a glance Long term strategy • 4 Segments • Organic growth • Differentiated approach Jotun Protects Property 9
Slide 10: Business segments
Jotun at a glance Business segments Decorative paints Protective coatings 36% 29% Total sales per segment Powder coatings Marine coatings 7% 28% Jotun 100%, August 2024 12 months rolling 10
Slide 11: Organic growth
Jotun at a glance Organic growth Sales New Fast Mature Growing • Key success factors: Saudi - Values and corporate culture - People – hire, train and retain Indonesia - Technology – forefront in selected areas Ethiopia Time 11
Slide 12: Continuous growth and profitability – Jotun 100%
Jotun at a glance Continuous growth and profitability – Jotun 100% Sales EBITA NOK million NOK million 90 000 9 000 NOK 8.3 billion 80 000 8 000 70 000 7 000 60 000 6 000 50 000 5 000 NOK 43.5 billion 40 000 4 000 30 000 3 000 20 000 2 000 10 000 1 000 0 0 Jotun 100%, actual rates 12
Slide 13: Continuous growth and profitability – Jotun Group
Jotun at a glance Continuous growth and profitability – Jotun Group Sales EBITA NOK million NOK million 80 000 8 000 70 000 7 000 NOK 6.4 billion 60 000 6 000 50 000 5 000 40 000 4 000 NOK 31.9 billion 30 000 3 000 20 000 2 000 10 000 1 000 0 0 Jotun Group, actual rates 13
Slide 14: Business update
Business update
Slide 15: High potential for further growth
Business update High potential for further growth Global market shares – per segment Decorative Paints Powder Coatings Protective Coatings Marine Coatings Jotun 3% 2% 7% 24% 3% LOCAL GLOBAL Jotun 100% 15
Slide 16: Jotun has grown faster than most competitors
Business update Jotun has grown faster than most competitors Jotun 100% Peers Average 300 250 200 150 100 50 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 Source: Annual reports (2013-2023), Index 2013 16
Slide 17: Profitability has been above most peers
Business update Profitability has been above most peers Jotun Source: Annual reports (2013-2023) 17
Slide 18: Profitability comparison 1st half 2024
Business update Profitability comparison 1st half 2024 Jotun Source: UBS
Slide 19: Jotun has grown faster than global GDP
Business update Jotun has grown faster than global GDP Index Jotun EBITA % Jotun volume Jotun sales Global GDP 900 19% 16% 12% 12% 13% 700 9% 10% 10% 10% 10% 681 8% Average growth (%) last 20 years: - Jotun sales: 10% 500 - Jotun volume: 7% - Global GDP: 3% 363 300 176 100 2004 2006 2008 2010 2012 2
Slide 20: The global paint market will continue to grow
Business update The global paint market will continue to grow Fastest growth expected in MEIA and SEAP AM ECA MEIA NEA SEAP 140 130 120 110 100 2023 2024 2025 2026 2027 2028 Source: Orr&Boss 20
Slide 21: Jotun is well-positioned in emerging markets
Business update Jotun is well-positioned in emerging markets % 8.0 7.2 Production & sales Sales 7.0 6.6 6.4 6.2 5.9 5.9 6.0 5.1 5.0 5.0 4.7 4.6 4.4 4.3 4.0 3.8 4.0 3.7 3.5 3.4 3.3 3.3 3.3 3.3 3.2 3.0 2.0 1.0 0.0 Expected GDP growth 2024-2029 (% average p.a.), Source: IMF October 2024 21
Slide 22: Financial status
~ Financial status
Slide 23: Revenue and profit has reached a new level
Financial status Revenue and profit has reached a new level Operating revenue Revenue growth (%) EBITA Margin 58,000 30% 10,000 25% 22% 20% 20% 20% 9,000 20% 48,000 14% 17% 8% 8,000 10% 7% 15% 14% 13% 3% 0% 7,000 10% 38,000 6,000 -10% 5% 5,000 28,000 -20% 0% 4,000 -30% -5% 18,000 3,000 -40% -10% 2,0
Slide 24: Gross margin supported by stable raw material prices
Financial status Gross margin supported by stable raw material prices Forecast Raw material index Total Gross Margin (12m) 60% 150 140 55% 130 50% 120 45% 110 100 40% 90 35% 80 30% 70 Sep Sep Sep Sep Sep Sep Sep Sep Sep Sep Sep Sep Sep Sep Sep Sep Sep 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24
Slide 25: Strong development in Return on Capital Employed
Financial status Strong development in Return on Capital Employed ROCE % Average 40% 30% 20% 10% 0% 2008 2010 2012 2014 2016 2018 2020 2022 Aug- 2024 Jotun Group, 12 months rolling 25
Slide 26: Jotun maintains a strong financial position
Financial status Jotun maintains a strong financial position Low net debt Strong equity ratio Solid cash position 80% NIBD Net debt/EBITDA 6,000 5,000 5 390 0.5 4 849 70% 4,000 0.5 61% 60% 5,000 0.4 0.4 60% 54% 55% 3,000 0.3 53% 4,000 1 807 1 690 50% 3 388 3 312 2,000 1 514 Policy requirement (50%)
Slide 27: The Three Step Model, our holistic approach to sustainability
Financial status The Three Step Model, our holistic approach to sustainability Avoided emissions Protecting property Input Operations Usage Long lasting efficiency and safety Innovation Operations Consumption Materials and Company Use, reuse services vehicles and recycle 27
Slide 28: Impact of long-lasting steel protection
Financial status Impact of long-lasting steel protection • Steel industry top 3 biggest producers of CO2 • Corrosion costs estimated at 3.4% of global GDP • 40% of global steel production is replacing corroded steel • Up towards 1 billion tons CO2e could be saved by improved corrosion control Source
Slide 29: Baltoflake – Beyond years, maintenance free
fbJOTUN Baltoflake BEYOND 30 YEARS Maintenance free 29
Slide 30: Clean shipping commitment
Financial status Clean shipping commitment • Jotun Hull Performance Solutions supports decarbonisation goals, reducing CO2 emissions through fuel savings • Our customers reduced emissions by 10,4 million tonnes CO2 in 2023 30
Slide 31: Summary
Summary • Proven and successful business model • Sales and profit at a new level • Well positioned for continued organic growth • Strong financial position 31
Slide 32: Jotun.com
Jotun Protects Property