Mersen Sa · EURONEXT:MRN
Mersen Sa — Investor Presentation (May 2021)
35 slides from Mersen Sa's investor presentation, May 2021
Slide 1: Expertise, our source of energy
Expertise, our source of energy a
Slide 2: What makes Mersen unique?
What makes Mersen unique? Competitive Positioned on Excellence to Expertise differentiation attractive markets drive cash-flow Solid balance sheet High barriers Sustainable and cash generation of entry (graphite development Advanced formulation, norms and Materials markets (Renewable High gross marg
Slide 3: Advanced Materials: High value-added customized solutions
Advanced Materials: High value-added customized solutions relying on a unique materials expertise Anticorrosion Equipment Graphite Specialties Power Transfer Technologies N° 1-2 Worldwide N° 1-2 Worldwide N° 1-2 Worldwide Engineering systems Columns, reactors and Laser galvo scanning Wafers carrier
Slide 4: Electrical Power: A unique portfolio serving two key applications
Electrical Power: A unique portfolio serving two key applications Electrical Protection N° 2 Worldwide in industrial fuses Coverage of all standards worldwide: UL, IEC, DIN, etc. Competitors: Eaton(US), Littelfuse (US) Fuses and fuse holders Surge protection devices Power Conversion N° 2 Worldwide (
Slide 5: A global footprint to maximize customer intimacy
A global footprint to maximize customer intimacy 24 sites 34% of sales 14 sites 33% of sales 13 sites 30% of sales Present in all large industrial countries with dedicated plant per business unit 5 sites 3% of sales Multi-activities plants in other countries (20% of total sales) Situation as of Dece
Slide 6: A longstanding CSR strategy
A longstanding CSR strategy, … History 2010 2018 2021 Focus on Set-up of a global CSR Improved Group’s H&S and reporting governance Intensity of GHG Human emission Capital Formalization of CSR Materiality matrix longstanding practices reduction target, Strong CSR roadmap and mid-term Diversity in se
Slide 7: 2021 priorities and outlook
01 2021 priorities and outlook
Slide 8: Positioned on buoyant sustainable development markets
Positioned on buoyant sustainable development markets Energies Processes Solar power 56% of sales for Energy Efficiency sustainable Wind power 20% Hydro development markets 32% Stable sales in 56% 2020 vs 2019 22% Electronics 11% Manufacture of Si and SiC semi-conductors Chemicals 16% Power electron
Slide 9: Offering growth opportunities in the short and medium-term
… offering growth opportunities in the short and medium-term 2022-2023 2020 2021 trend Solar power Energy Wind power Conventional energy Manufacture of SiC semi-conductors Electronics Manufacture of Si semi-conductors Power electronics Rail Transportation Aeronautics Electric vehicles Chemicals Corr
Slide 10: Solar: significant potential for Mersen by focusing on premium offer
Solar: significant potential for Mersen by focusing on premium offer Expected 255 market growth of 250 15% per year on average 200 200 Developing technology: Increase in size of cells (from 152 mm to 210 mm) 150 Annual GW 100 100 Mersen’s positioning on a Mersen sales in €m comprehensive premium off
Slide 11: Mersen's expertise applied to premium solar power
Mersen’s expertise applied to premium solar power ADVANCED MATERIALS SEGMENT ELECTRICAL POWER SEGMENT Graphite anticorrosion systems for HCl synthesis CVD reactors 2020 Graphite SALES electrodes 1,400°C CZ processes €60M Polysilicon Monocrystalline silicon Solar panel protection Energy storage and m
Slide 12: Growth of the SiC semiconductors market
Growth of the SiC semiconductors market is set to accelerate in line with EV market growth USD million x4 between 2020 and 2025 2000 Other Industries Renewable energies 1000 Electric vehicles 0 2020 2021 2022 2023 2024 2025 Source: Yole 12 May 2021
Slide 13: Mersen's expertise in SiC semiconductors
Mersen’s expertise in SiC semiconductors ADVANCED MATERIALS SEGMENT ELECTRICAL POWER SEGMENT End markets GRAPHITE, GRAPHITE COMPONENTS FOR INSULATION FOR WAFER INVERTERS FURNACES CARRIER Diode, transistor Crystal growth Epitaxy Ion implantation Inverter Annealing Power module 13 May 2021
Slide 14: Graphite and insulation determine the quality of silicon carbide wafers
Graphite and insulation determine the quality of silicon carbide wafers and therefore the cost of semiconductors 2,400°C +/- 1°C Induction heating SiC ingot Quartz tubing 2020 SALES INSULATION €30M SiC powder GRAPHITE CRUCIBLE 14 May 2021
Slide 15: Unique position in the SiC manufacturing process
Unique position in the sophisticated and intricate SiC manufacturing process Key products for ingot quality Expertise through long-standing ties (and therefore process efficiency): with pioneers in the industry for over 20 ▪ Purity of graphite years ▪ Insulation properties MID TERM ANNUAL SALES €50-
Slide 16: Electric vehicles: Market growth is accelerating
Electric vehicles: Market growth is accelerating Number of electric vehicles 12,500 Individuals >400V sold per year (thousands) x3 between 6000 2024 and 2030 x2 between 2020 and 2024 1000 2020 2021 2022 2023 2024 2030 Source: Mersen estimates 16 May 2021
Slide 17: Mersen's offering for EV/HEV applications
Mersen’s offering for EV/HEV applications BATTERY MODULE RAPID CHARGING STATION Monitoring Fuse 50kW-100kW busbar INVERTER SPD Capacitors Busbar ELECTRICAL PROTECTION OF VEHICLES Fuse 2020 Hybrid fuse SALES Main fuse Auxiliary fuse €15M Busbar Integrated by Autoliv 17 May 2021
Slide 18: Mersen is successfully adapting to this new market and these new customers
Mersen is successfully adapting to this new market and these new customers RELATIONS FIRST CONTRACT TECHNICAL GLOBAL WITH WON INNOVATION PRESENCE ▪ Traditional car ▪ Marquardt ▪ Joint ▪ Eventually, 3 manufacturers MID-TERM ▪ Contract over the collaboration dedicated plants in ANNUAL SALES ▪ New entr
Slide 19: Columbia, additional capacity to serve our growth markets
Columbia, additional capacity to serve our growth markets 2019 2020 2021 2022 and beyond Return of facilities First batch Transfer and Startup Insulation for solar to working order extruded graphite GRI insulation line (Americarb) and semiconductor markets, heat processing Production launch Extruded
Slide 20: Continued industrial optimization
Continued industrial optimization HEALTH AND OPTIMIZATION REDUCED SAFETY: THE OF INDUSTRIAL SITES ENVIRONMENTAL PRIORITY FOOTPRINT ▪ Accident frequency rate: ▪ Enhanced manufacturing efficiency on ▪ Target to reduce GHG 1.54 (medium-term Europe’s electric fuse market (Fusetech) emissions intensity b
Slide 21: Shareholder return: return to dividend payment
Shareholder return: return to dividend payment: €0.65 per share Dividend in € Payout as a % of restated net income 35% 1 38% DIVIDEND POLICY 0,8 39% Payout of between 30% and 40% of Group net 34% income restated for 0,6 non-recurring items Decision to cancel the dividend in April 0,4 2020 in a perio
Slide 22: Operational priorities and outlook for 2021
Operational priorities and outlook for 2021 We continue to seize growth opportunities: Solar, semiconductors, EV – by investing when necessary Attentive to signs of recovery, Like-for-like sales growth of between 2% and 6% especially in Europe and the United States And subject to no major We are acc
Slide 23: Asia still driving Group's growth in Q1
Asia still driving Group’s growth in Q1, as well as markets linked to sustainable development €220m flat North -5% Like-for-like growth America vs Q1 2020 Europe -3% vs Q1 2020 Solar, wind +9% Asia-Pacific Power electronics vs Q1 2020 semiconductors Rail South America/ +13% Electric vehicles Africa
Slide 24: 2020 Results
02 2020 Results
Slide 25: 2020: Good performance in an unprecedented year
2020: Good performance in an unprecedented year Sales: €847m down 11% vs 2019, with broadly stable sustainable development markets Targeted measures when needed: furlough and short- time working schemes, targeted restructuring Operating margin before non-recurring items: 8.1% of sales Continued stra
Slide 26: Contained decrease in 2020 sales
Contained decrease in 2020 sales €847m North -11.4% -13% America vs 2019 Europe -16% vs 2019 Like-for-like growth (as a %) Asia-Pacific -2% vs 2019 South America/ -20% Advanced Africa vs 2019 Materials -14.7% Electrical Power -7.1% Like-for-like growth (as a %) The Asia-Pacific region stands out, wi
Slide 27: Profitability held up well
Profitability held up well Operating income before non-recurring items (€m) Operating margin before non-recurring items (% of sales) 10.8% 2019 operating margin before 10.8% non-recurring items 102 8.1% 2020 EBITDA Volume/mix effects -3.9 €123m Net savings excluding additional costs linked 14.5% of
Slide 28: Net income impacted by non-recurring items
Net income impacted by non-recurring items In €m 2019 2020 Non-recurring expenses Restructuring costs: €17m Operating income before non-recurring 102.2 68.6 Impairment of under-used assets: items €8m Goodwill impairment for ACE: €17m Non-recurring income and expenses (11.3) (51.4) Litigation and acq
Slide 29: Solid generation of operating free cash flow
Solid generation of operating free cash flow FCF in €m Free operating cash flow after capital expenditure Cash flow conversion* 103% 76 (79% in 2019) 60 Funding for capex €57m WCR 20.5% of sales (22% in 2019) 2019 2020 * Operating cash flow before capex/EBITDA 29 May 2021
Slide 30: Significant reduction in net debt
Significant reduction in net debt Not including Lease liabilities: €47m 218 Provisions for pension obligations: €72m 133 180 (17) (14) (7) (57) Net debt/EBITDA 1.65 Net debt/Equity 33% Dec. 2019 Operating cash flow Capex Acquisitions Interest Lease and Other Dec. 2020 30 May 2021
Slide 31: A solid balance sheet with liquidity to cover repayments
A solid balance sheet with liquidity to cover repayments for the next few years DRAWN CREDIT LINES AT DECEMBER 31, 2020 IN €M 130 UNDRAWN USPP CREDIT Schuldschein LINES NEU CP €160M NEU MTN 60 60 CASH AVAILABLE 41 €110M MATURITY 4 YEARS 2020 2021 2022 2023 2024 2025 2026 NEU CP: Negotiable European
Slide 32: Appendix
03 Appendix
Slide 33: Both segments contributed to the Group's resilience
Both segments contributed to the Group's resilience Operating income before non-recurring items (€m) Operating margin before non-recurring items (% of sales) Advanced Materials Electrical Power 15.1% 9.4% Negative volume effect – 12.1% more significant in AM 7.5% 82 Stable prices in both 38 segm
Slide 34: Targeted adaptation plan
Targeted adaptation plan € millions 2020 2021 2022 Total Strong downturn in the Impact on P&L Adaptation plan 17 5 22 aeronautics and chemicals markets Total expected savings based on 2019 10 16 16/y cost structure Continued review of operational efficiency in the Cash-out of adaptation plan 5 17 22
Slide 35: Investing to build the future
Investing to build the future Columbia Environment Reduce GHG emissions intensity Improve processes St Bonnet solar power plants 2021 €70m-€80m Maintenance Growth and Productivity Electric vehicles Including IT projects Solar: Galaxy extension (China) Semiconductors: Expansion into South Korea & Ind