Tomra Systems Asa · OSL:TOM
Tomra Systems Asa — Investor Presentation (April 2023)
72 slides from Tomra Systems Asa's investor presentation, Apr 28, 2023
Slide 1: Investor Presentation
Investor Presentation TOMRA Click to Systems ASA enter name 28 April 2023 Place © TOMRA dd.mm.yy
Slide 2: Our vision is to Lead the Resource Revolution
Our vision is to Lead the Resource Revolution It is our belief that businesses have the power and responsibility to help manage our planet’s precious resources – today and tomorrow. 2
Slide 3: Creating sensor-based solutions for optimal resource productivity
5000 12.2 BILLION NOK EMPLOYEES REVENUES IN 2022 GLOBALLY Creating sensor-based solutions for optimal resource productivity - transforming how we obtain, use, and reuse resources Collection Recycling Food Click to enter name Place dd.mm.yy Publicly listed on Oslo Stock Exchange (OSEBX: TOM)
Slide 4: Our transformation journey
Our transformation journey 2011 COLLECTION 2012 FOOD 2016 FOOD 2008 RECYCLING Sale of Californian material handling TOMRA acquires BEST, leading TOMRA expands into lane business. With the divestment the US food sorting machine producer. sorting, acquiring New Zealand TOMRA acquires With the acquisit
Slide 5: We have built a broad business platform
12.2 billion NOK We have built a FOOD broad business RECYCLING platform… … while keeping a 2.7 billion NOK strong entrepreneurial COLLECTION spirit 2002 2004 2006 2008 2010 2012 2014 2016 2018 2020 2022 Revenues 5
Slide 6: Creating value through three divisions
Creating value through three divisions TOMRA Collection TOMRA Recycling TOMRA Food 2022 Revenue 2022 Revenue 2022 Revenue 51% 19% 30% ~2,600 Customers ~800 Customers ~1,600 Customers Grocery retailers, bottlers, Waste management, material Food growers, packers, Employees deposit scheme coordinators
Slide 7: TOMRA's global presence
Installed base ῀105,000 TOMRA’s global presence EMEA ~75,000 Americas ~22,000 Asia Pacific ~8,000 Collection Recycling Food EMEA ῀63,000 ῀6,300 ῀5,600 Americas ῀14,000 ῀1,400 ῀6,300 Asia Pacific ῀5,000 ῀1,300 ῀1,900 Total ῀82,000 ῀9,000 ῀13,8008
Slide 8: TOMRA Collection
TOMRA Collection — 10
Slide 9: Global leader in reverse vending
50 years of TOMRA experience Global leader in reverse vending 82 000 machines in operation technology We are Represented in more than leader globally 60 markets Collecting 45 billion containers a year 6.2bn NOK revenues 11
Slide 10: An overview of current deposit markets
An overview of current deposit markets Northwest Territories (2005) Quebec Norway Sweden (1984) (1984) (1999) Yukon (1992) Finland Iceland (1996) (1989) Newfoundland Ontario (1997) Denmark Estonia (2007) (2002) (2005) British Columbia Latvia (1970) (2022) Prince Edwardian Lithuania Netherlands (2016
Slide 11: Upcoming deposit markets
Upcoming deposit markets Quebec: Deposit system to be Hungary: modernized 2023 Scotland: Deposit system to be Container deposit scheme implemented 2024 planned to start 2024 Connecticut: Ireland: Expansion of existing Deposit system to be Romania: deposit system in 2024 implemented in 2024 Deposit s
Slide 12: Driving market momentum through global advocacy work
We are driving the market momentum through global advocacy work aiming to achieve best practice deposit systems and generate demand through innovations Collection targets for Targets for recycled content plastic beverage bottles in plastic beverage bottles EUROPE 77% 90% 25% 30% 2025 2029 2025 2030
Slide 13: High collection rates achieved in two years' time
High collection rates achieved in two years’ time Return rate Deposit value in EUR Return rates in Lithuania 98% 95% 92% 92% 92% 92% Prior to container 34% deposit 66% scheme 43% ~40% End of 74% year 1 0.25 0.25 0.21- 0.31 No deposit No deposit 0.1-0.4 0.09 0.1 0.05 End of year 2 92% *Deposit values
Slide 14: The four principles of high-performing deposit return systems
The four principles of high-performing deposit return systems PERFORMANCE CONVENIENCE PRODUCER RESPONSIBILITY SYSTEM INTEGRITY A collection target for a The redemption system is Producers manage, finance Trust is built into the broad scope of beverage easy, accessible and fair and invest in the syst
Slide 15: Reinvestment of unredeemed deposits and material revenue
Reinvestment of Profit and loss overview of Norway’s unredeemed deposits Central System Administrator (2019) and material revenue within the system In Norway over 80% of the system’s costs are covered by unredeemed deposits and material revenue 17
Slide 16: Legislative outlook supports new and expanded Deposit Return Schemes
Canada provinces Legislative outlook supports new and expanded Deposit US states Expansion and Singapore as modernization Return Scheme Single Use launchpad in South-East Asia (DRS) markets Plastic Directive towards 2030 Australia - States Potentially first one-way DRS in First full DRS Latin Americ
Slide 17: Europe and the Single Use Plastic Directive
All EU member states to collect 90% of plastic beverage bottles by 2029 Europe and the Single Use Plastic Directive (SUPD) will be the main driver of new deposit markets towards 2030 Existing DRS markets* EU countries 19 * In addition, some markets have refillable deposit systems such as: Austria, B
Slide 18: Strong local presence in existing and upcoming European deposit markets
Establishing local TOMRA entities and building local presence and partnerships early is key in our go to market strategy Strong local presence in existing and upcoming European deposit markets Existing DRS markets* EU countries 20 * In addition, some markets have refillable deposit systems such as:
Slide 19: Preferred partner in reverse vending solutions
Preferred partner in reverse vending solutions >80 000 10 000- 80 000 # of installed RVMs TRUSTED PARTNER SERVICE NETWORK 5 000- 10 000 500- 5 000 INNOVATION SOLUTIONS CHAMPION PORTFOLIO <500 1-10 11-20 21-30 31-40 >40 21 Number of RVM markets Source: TOMRA estimates and analysis
Slide 20: Customer centricity is at the core of our innovation strategy
Customer centricity Efficient A smart is at the core of our A great recycling investment operations for experience for long-term innovation strategy peace of mind benefits Strategic aspiration: Innovate the most attractive solutions and the best customer experience 22
Slide 21: Business model expertise across deposit systems
Business model expertise across deposit systems Financing Retail Sales & Service model Throughput model Upfront equipment High recurring revenue Revenue Recurring service Location revenues Swift roll-out Proven track record Aligned interests Retailer purchases and takes the TOMRA owns and operates t
Slide 22: Cash flow profiles of the two business models
Cash flow profiles of the two business models Illustrative cash flow profiles per machine Cash flow Higher initial sales Higher recurring revenue Year 0 Time Sales & Service Throughput Upfront CAPEX 24
Slide 23: Flexibility and scalability to enable new business models and new market entry
Flexibility and scalability to enable new business models and new market entry Redemption centers, small depots etc. Large depots, counting centers PRICE Discounters/Supermarkets Small stores 0.1 -0.3 M UBC/year 0.3 -1 M UBC/year 1-3 M UBC/year 3-5 M UBC/year 5 -15 M UBC/year 15 -50 M UBC/year CONTA
Slide 24: Advanced digital platform leveraged across stakeholder groups
Advanced digital platform leveraged across stakeholder groups TOMRA Productivity Gain Consumer Engagement API/Data System Integration DIGITAL PLATFORM Retail Productivity Gain 26
Slide 25: | | | 'BILASIPULLOJA TAHAN
| | | 'BILASIPULLOJA TAHAN ee Se —AUTOMAATTIN,KIITOS AUKI
Slide 26: RVM Kiosks, Reverse Vending Centres, Single RVMs
RVM Kiosks Reverse Vending Centres Single RVMs Automated Depots Over the Counter Scheme App 28
Slide 27: Global Supply Chain
Current supply chain with country origin on purchased material China Norway Taiwan Sweden Global Supply Poland Chain Germany Optimize global sourcing and production set-up The goal Support the market demands both on capacity and flexibility Dual sourcing strategy in focus to reduce risk and exposure
Slide 28: Our Big Hairy Audacious Goal
Our Big Hairy Audacious Goal 500 BILLION empty beverage containers handled by TOMRA equipment and collected for clean loop recycling 30 30
Slide 29: TOMRA Recycling
TOMRA Recycling 31
Slide 30: Legislative push and market pull towards a circular economy
There is a legislative push and market pull towards a circular economy Ellen MacArthur Foundation Global Commitment Extended Producer Responsibility policy is a key element, complemented Several strong commitments have been made; however, by quotas, taxes, bans, and mandatory recycled content target
Slide 31: Packaging waste including EPS
Example: Norway Target 2025=50% recycling Target 2030=55% recycling Packaging waste including EPS [Ton] EU member states need to meet PPWD1 targets for plastic recycling Total waste generated Material recycled EU target Material recycled, new measurement point 1 Packaging and Packaging Waste Directi
Slide 32: Strong commitment from the industry to use recycled polymers
Strong commitment from the industry to use recycled polymers Selected global commitments (non-exhaustive) “Our ambition is to use 1 million tons of plastic 1 waste a year in our global chemical plants by 2025” million tons “Produce and market 2 million tons of recycled 2 and renewable based polymers
Slide 33: Sorting is essential for a circular economy
Sorting is essential for a circular economy Waste sorting segment Recycling segment Ore sorting segment Recover materials for recycling from both Upgrade material to pure fractions Recovery and ore sorting source separated and mixed household for high quality recycling to reduce environmental waste
Slide 34: How does sensor-based separation work?
How does sensor-based separation work? Feeding of High-tech sensors to identify objects unsorted material Precise ejection by ultra fast air jets Product specific equipment design often including multiple technologies to maximize sorting efficiency High-speed processing of information (material, sha
Slide 35: A broad sensor-based technology portfolio
A broad sensor-based technology portfolio RECYCLING FOOD ELECTROMAGNETIC SENSOR (EM) Electro-magnetic properties like conductivity and permeability X X LED SPECTOMETRY (LED) Color and spectral properties based on multiple LED light X X EM sources in very high optical resolution LED NEAR-INFRARED SPE
Slide 36: Automation with TOMRA units
Automation with TOMRA units 39
Slide 37: Our solutions enable recovery of recyclables from different waste streams
Our solutions enable recovery of recyclables from different waste streams AVL Leipzig, Germany Mixed Waste Sorting Plant IVAR, Norway A modern packaging sorting plant can contain up to 60 NIR sorters Our solutions can also recover valuables from residual waste streams 40 40
Slide 38: Mining needs to make a leap towards a more sustainable future
The essential nature of mining means that the industry needs to make a leap towards a more sustainable future Run of Mine (ROM) Crushing Sensor Based Sorting Waste Product • 15% to 50% of the ROM can be rejected in an early stage of the process (application dependent) • low grade waste rocks don’t n
Slide 39: Our ore sorting solutions enable the mining industry to reduce their footprint
Our ore sorting solutions enable the mining industry to reduce their footprint Ore sorting is used to: • Reduce operational footprint by splitting the “good” and the “bad” materials early in the process • Extend the lifetime of a mine • Reclaim valuables for stockpiles 42
Slide 40: Our technology and innovations push the boundaries of recycling sorting
Our technology and innovations continue to push the boundaries of the recycling sorting market New segments for automated sorting Increase of automation and performance Capacity growth Recycling sensor-based 7% sorting equipment market Out of scope for TOMRA addressable market: other non-sensor-base
Slide 41: Our solutions close the loop by enabling high quality recycling
Our solutions close the loop by enabling high quality recycling Plastics Wood sorting Textile sorting Alloy sorting We are actively pushing the We are investing into the development of solutions for new segments boundaries of plastics recycling by: • Demonstrating advanced mechanical recycling • Sup
Slide 42: We have two strategic priority areas
We have two strategic priority areas Accelerate growth Provide leading solutions and innovations Increase the recovery Enable high quality closed Utilize cutting edge Deep market expertise of recyclables loop recycling sensor technology and partnership Exploit the power Develop digital of deep learn
Slide 43: Commitment towards plastic packaging by 2030
Our commitment towards plastic packaging by 2030 We are here to 30% of post-consumer plastic packaging is recycled in a closed-loop enable closed loop recycling solutions - material stream by material stream 46 46
Slide 44: TOMRA Food
TOMRA Food 47
Slide 45: Robust drivers supporting the market
Robust drivers supporting the market Population growth and rise of the middle class Continued loss and waste of food Shift to automation and digital tools North America, Europe Latin America Asia and Oceania and South Africa Cyclical investments in different categories, regions and seasons 48 Automa
Slide 46: TOMRA Food with a strong value proposition
TOMRA Food with a strong value proposition Why Automate Why TOMRA Know-how Technology Partnerships Food safety Quality Yield increase Expertise to Best-in-class With local improvement transform the sorting and understanding, global food industry grading solutions, know-how and long- and digital insi
Slide 47: We are addressing approximately 60% of the total food sorting and grading market
Market position and addressable market Global food processing and machinery industry We are addressing Sorting and grading market approximately 60% Out of scope for TOMRA: of the total food • Low-cost and low-tech color sorting • Limited automation markets sorting and grading Addressable market mark
Slide 48: Our Technology
Our Camera Laser Technology… Digital Pulsed LED Spectroscopy X-ray 51
Slide 49: Detecting a wide range of parameters
Foreign Blemishes Toxins Structure Material …are detecting Removal of foreign material in a material Objects with spots or other (small) blemishes Removal of produce contaminated with Removal of soft, molded or rotten food a wide range stream, e.g. insects, glass, metal, wood & are removed aflatoxin
Slide 50: Working principles in Food sorting
Air inspection Belt inspection 1 Working 3 2 2 3 4 1 principles in 5 Food sorting 4 1 Infeed Belt (unsorted) 4 Precise air guns 1 Infeed belt (unsorted) 3 Intelligent finger ejectors 2 Cameras 5 Accept / reject 2 Full width NIR and Color 4 Accept/reject 3 Lasers Vision sensors Chute or Channel sorte
Slide 51: Food technology platforms
Food technology platforms Solutions for fresh and processed produce TOMRA A Product Line TOMRA B Product Line TOMRA C Product Line TOMRA X Product Line Peeling Lines TOMRA 3A Series TOMRA 5A Series TOMRA 5B TOMRA 3C TOMRA 5C TOMRA 5X Peeling Integrated sorting solutions for fresh produce TOMRA S Pro
Slide 52: Leading position globally
Leading position globally Total Food Sorting and Grading Market >3k # of installed machines Addressable Food market Chute 1-3k TOMRA 2022: ˜0.4 EUR billion Lane 0-1k Belt 10-25 25-50 >50 markets markets markets Geographic presence 55 Size of bubble = Estimated revenue from sensor-based sorting and r
Slide 53: Food Categories
Food Categories Potatoes Nuts & Dried Fruit Vegetables Apples Citrus Berries Cherries Fresh Cut Avocados Kiwifruit Grains & Seeds 56
Slide 54: Leading technology
Leading technology Sorting & Artificial Grading Intelligence Data & Service & Analytics Support 57
Slide 55: Some of our customers
Some of our customers Processed Food Fresh Food 58
Slide 56: Corporate strategy and sustainable growth
Corporate strategy and sustainable growth 59
Slide 57: Group financials development
Group financials development Revenues Gross contribution and margin 14,000 5,500 50% 5,000 45% 12,000 4,500 40% 10,000 4,000 35% 3,500 8,000 30% MNOK MNOK 3,000 25% 6,000 2,500 20% 2,000 4,000 1,500 15% 1,000 10% 2,000 500 5% 0 0 0% 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2012 2013 20
Slide 58: Recycling and Food
Recycling and Food Connected Sorters TOMRA Insight Users 01/2018 01/2019 01/2020 01/2021 01/2022 01/2023 61
Slide 59: Accelerate growth in core business and develop adjacent opportunities
Our strategy is to accelerate growth in core business and develop adjacent opportunities 62 62
Slide 60: Ideally positioned to develop adjacent opportunities
Ideally positioned to develop adjacent opportunities TOMRA’s competitive edge, Strong macro trends and market position and technology emerging business models can be applied in areas beyond within circular economy and our current operations resource efficiency 63 63
Slide 61: Examples of what we are exploring
Enabling automation in Digital business models textiles recycling Examples of what we are exploring Collection systems for Closing the gap in reusable packaging plastic recycling 64
Slide 62: The gap in plastics recycling
The gap in plastics recycling Majority of plastics are lost today Demand for recycled plastics • In Europe alone, 24 million tons of plastics are GAP • Already a strong demand for recycled plastics will lost to incineration and 14 million tons to landfill increase significantly in the next few years
Slide 63: Closing the circularity gap
Closing the circularity gap Suppliers Customers Mixed plastics fraction needs Connecting the value chain Sorted polymer fractions to be made available by (e.g., HDPE, PS, PP, etc.) to incinerators, landfills, and be supplied to recyclers with other sources the right quality 66
Slide 64: TOMRA is uniquely positioned along global megatrends
We have set bold ambitions TOMRA is uniquely to double our business in the positioned along next five years global megatrends ➢ Accelerate growth in core ➢ Develop adjacent business 67 67
Slide 65: Our ambitions 2022 – 2027
Our ambitions 2022 – 2027 Revenue EBITA Dividend Capital Net Zero growth margin payout structure Holistic 15% at 40 – 60% Investment sustainability CAGR 18% of EPS grade strategy Click to enter name Place dd.mm.yy 68
Slide 66: Our ambition is to keep an investment grade status
Our ambition is to keep an investment grade status Green Bond Framework Financial Risk Profile A- A Scope Ratings June 2022 Business Risk Profile Investment BBB+ grade 69
Slide 67: TOMRA Green Bond Framework
TOMRA Green Bond Framework Use of proceeds Highlights form Cicero Second Party Opinion ICMA category: Pollution prevention and control “TOMRA’s RVMs and waste sorting machines are well-aligned with circular economy Expenditures related to: Examples of eligible assets: solutions and a low-carbon futu
Slide 68: Targets for Sustainable Growth
Targets for Sustainable Growth 71
Slide 69: For a sustainable planet for generations to come
For a sustainable planet for generations to come 73 73
Slide 70: We have an obligation to grow
we have an obligation to grow 74 74
Slide 71: Copyright and Disclaimer
Copyright The material in this Document (which may be a presentation, video, brochure or other material), hereafter called Document , including copy, photographs, drawings and other images, remains the property of TOMRA Systems ASA or third-party contributors where appropriate. No part of this Docum
Slide 72: www.tomra.com
www.tomra.com