Slide 1: Aquafil Group 2020 Financial Results
Aquafil Group 2020 Financial Results 11st March 2021
Slide 2: Index Page
Index Page 1. KEY MESSAGES 4 2. 2020 RESULTS 6 3. SPECIAL PROJECTS 22 4. SUSTAINABILITY PATH 27 5. OUTLOOK 36 6. APPENDIX 39 2
Slide 3: Index Page
Index Page 1. KEY MESSAGES 4 2. 2020 RESULTS 6 3. SPECIAL PROJECTS 22 4. SUSTAINABILITY PATH 27 5. OUTLOOK 36 6. APPENDIX 39 3
Slide 4: 2020 – Results improvement and “circularity path” right balance
2020 – Results improvement and “circularity path” right balance EXTRAORDINARY REACTION IN EXTRAORDINARY TIMES IMPROVED BASES FOR GROUP FUTURE THANKS TO AN EXTRAORDINARY TEAM STRATEGIC PATH TO “CIRCULARITY” FAST AND EFFECTIVE ADOPTION ENHANCED BY PANDEMIC EVENT OF COUNTERMEASURES TO MINIMISE PANDEMIC
Slide 5: Index Page
Index Page 1. KEY MESSAGES 4 2. 2020 RESULTS 6 3. SPECIAL PROJECTS 22 4. SUSTAINABILITY PATH 27 5. OUTLOOK 36 6. APPENDIX 39 5
Slide 6: 2020 – Strong Group reaction from all point of view
2020 – Strong Group reaction from all point of view REVENUES EBITDA NET PROFIT NFP 2019 2020 ∆% 2019 2020 ∆% 2019 2020 ∆% 2019 2020 ∆% 2020 549.0 436.6 (20.5%) 2020 69.4 58.4 (16.0%) 2020 9.0 0.6 (93.4%) 249.6 218.8 14.2% % on net s a l es 12.6% 13.4% % on net s a l es 1.6% 0.1% 4QUARTER 129.4 108.7
Slide 7: Revenues – Double negative influence in 2020
Revenues – Double negative influence in 2020 • 2020: influenced both by COVID impact and raw material price adjustment – Volume : a constant recovery after lockdowns end brought decrease to 12% (1) – Price: increasing negative impact among the year o Caprolactam price down by around 19% with the pea
Slide 8: Revenues – Different recovery speed by region
Revenues – Different recovery speed by region • 2020: fastest recovery in Asia Pacific thanks to BCF residential – EMEA: influenced by BCF due to “contract” final application (1) – North America: driven by O’Mara, NTF growth mitigated BCF weakness • 4Quarter: positive volume in EMEA driven by Polyme
Slide 9: Revenues – BCF most influenced business line
Revenues – BCF most influenced business line SALES BREAKDOWN by PRODUCT LINE 120% 120% 100% 100% 7.5% 8.1% 7.0% 10.4% 7.1% 6.9% 7.3% 7.7% 80% 20.7% 80% 19.6% 22.1% 22.0% 22.1% 19.3% 20.7% 21.4% 60% 60% 40% 40% 72.9% 72.3% 67.9% 73% 70.6% 69.8% 20% 72.2% 71.7% 20% 0% 0% 4Q2019 4Q2020 BCF NTF Polymers
Slide 10: Revenues – Highest price adjustment in 2H
Revenues – Highest price adjustment in 2H 2020 BCF NTF POLYMERS TOTAL 2020 2019 ∆ ∆% 2020 2019 ∆ ∆% 2020 2019 ∆ ∆% 2020 2019 ∆ ∆% EMEA 150.9 203.9 (53.0) (26.0%) 67.2 87.9 (20.7) (23.5%) 29.8 35.5 (5.6) (15.9%) 247.9 327.2 (79.3) (24.2%) North America 80.6 106.1 (25.5) (24.0%) 25.2 16.4 8.8 53.9% 5.
Slide 11: Revenues – ECONYL® – Pandemic impact in 2H on BCF
Revenues – ECONYL® – Pandemic impact in 2H on BCF • 2020: different path among the year due to end market different timing reaction – 1H2020: strong orders increase in 1Q driven by clients' fears related to any production stops in Europe – 2H2020: pandemic full impact • Completely different results
Slide 12: Revenues – ECONYL® – Consistent historical growth
Revenues – ECONYL® – Consistent historical growth 10.0% ECONYL® and “OTHER FIBRES” • 2015-2019: consistent historical growth delivery GROWTH RATE (1) 7.5% – average increase was more than 2x total fibres growth – % on net sales increased from 32.5% to 37.5% 5.0% 6.4% 2.5% • 2020 decreased related to
Slide 13: Revenues – ECONYL® – Consistent historical growth – Drivers
Revenues – ECONYL® – Consistent historical growth – Drivers • Group was able to both influence and benefit from increased focus sustainability thanks to marketing efforts among the entire value chain • Fundamental drivers of these results were – R&D activities – Capability to increase industrial cap
Slide 14: EBITDA – Effective and consistent minimisation of flow through
EBITDA – Effective and consistent minimisation of flow through • Increasing effects among the year of actions promptly implemented in 2Q – 2Q: sales fall by 42.3%, EBITDA reduction by 52% – FY: sales decrease by 20.5% , EBITDA by 16% Sites: prompt adoption stricter safety measures, including new sit
Slide 15: EBITDA – Effective and consistent minimisation of flow through
EBITDA – Effective and consistent minimisation of flow through • 2020: contingency plan enhanced by 2019 saving plans implementation – 2019 delivery saving plans better than expected – Pandemic action plans includes various national grants to support employment (1) • 4Quarter: sales mix and US grant
Slide 16: P&L – Sales reduction and depreciation influence
P&L – Sales reduction and depreciation influence 4Q2020 2020 2019 2020 ∆% 2019 2020 ∆% REVENUES 129.4 108.7 (16.0%) 549.0 436.6 (20.5%) EBITDA 14.5 18.3 % 26.1 69.4 58.4 (15.9%) % on net sales 11.2% 16.8% 12.6% 13.4% EBIT 0.4 5.8 n.s. 17.4 5.9 n.s. • Depreciation: + € 5.8m driven % on net sales % 0.
Slide 17: NFP – Improvement of 12.4%
NFP – Improvement of 12.4% • From € 250m to € 219m – A broad and effective action plan, leveraging on steps already taken in 2019 Proactive and efficient inventories management NWC leveraging on raw material evolution too CASH CAPEX Balance between short and medium long term approach GENERATION M&A
Slide 18: NFP – Strong cash generation
NFP – Strong cash generation NFP HISTORICAL EVOLUTION 250 242 157 112 NFP EVOLUTION CASH GENERATION: € 31.0 18
Slide 19: CAPEX – Development and circularity as milestones
CAPEX – Development and circularity as milestones • Conclusion of past important development projects and strong focus drove material CAPEX reduction – Balance between short term needs and long-term approach • Group CAPEX consistently driven by development, with circularity as milestones – Capacity
Slide 20: CAPEX – Development and circularity as milestone – R&D
CAPEX – Development and circularity as milestone – R&D • “Circularity” as key milestone Project “Eco-design” BCF Flame retardant, anti-stain, and anti-static yarns Anti-bacterial and anti-viral PA6 yarns NTF Low thermal resistance PE yarns for apparels MAIN High UV and thermal resistance PA6 yarns f
Slide 21: Index Page
Index Page 1. KEY MESSAGES 4 2. 2020 RESULTS 6 3. SPECIAL PROJECTS 22 4. SUSTAINABILITY PATH 27 5. OUTLOOK 36 6. APPENDIX 39 21
Slide 22: Projects updating – O’Mara acquisition
Projects updating – O’Mara acquisition • Group acquired O’Mara in June 2019 to enter O’MARA RESULTS EVOLUTION (1-2) 50 North American NTF market – Focus on interiors (furniture and mattresses application) and sportswear supply chain 25 • In the first full year inside the Group, Company 0 2018 2019 2
Slide 23: Projects updating – Bio based nylon project
Projects updating – Bio based nylon project • A pillar of Group “The ECO PLEDGE®» and one of the most relevant initiatives in which the Group takes part – 2 different path: Genomatica and Effective projects • Genomatica – Joint technological development to develop the first renewable raw-material ba
Slide 24: Projects updating – Bio based nylon project
Projects updating – Bio based nylon project • Effective – To develop an economic and sustainable process based on renewable raw materials to produce bio caprolactam and bio-polyamide and bio-polyester fibers and films o polymers versatility allow application in a wide variety of products and sectors
Slide 25: Projects updating – ACR#1 and ACR#2
Projects updating – ACR#1 and ACR#2 2017-2019 2020 2021 Plants and organisations Pandemic surge impacted demand ACR#1 and #2 defined and created to have but not improvement efforts activities will be expanded, an ECONYL® supply source whose benefits became more becoming operating units in North Amer
Slide 26: Index Page
Index Page 1. KEY MESSAGES 4 2. 2020 RESULTS 6 3. SPECIAL PROJECTS 22 4. SUSTAINABILITY PATH 27 5. OUTLOOK 36 6. APPENDIX 39 26
Slide 27: Aquafil sustainability path – Grounded on vision and business model
Aquafil sustainability path – Grounded on vision and business model • Journey to circularity started with a deep business model review to prepare Group to next decades evolution based on cultural sensitiveness to environmental topics and Group R&D and technological strengths • Aquafil correctly iden
Slide 28: Aquafil sustainability path – A journey started in 1990
Aquafil sustainability path – A journey started in 1990 1990 1998 2007 2008 2011 2013 «Lactamic waters» Waste recovery The Eco Pledge® «Energy & ECONYL® «The Healthy Seas – A recovery from for techno polymers foundation Recycling» team: Regeneration System: journey from Waste to polymerization produ
Slide 29: Aquafil sustainability path – The ECO PLEDGE®
Aquafil sustainability path – The ECO PLEDGE® RETHINKING PRODUCTS IN A CIRCULAR PERSPECTIVE SUPPORT LOCAL Innovating products to make them more COMMUNITIES and more circular, giving new life to waste materials, in an infinite cycle. Grow in harmony with local communities, promoting a prosperous and
Slide 30: Aquafil sustainability path – The ECO PLEDGE®
Aquafil sustainability path – The ECO PLEDGE® SUSTAINABILITY PILLARS IMPROVEMENT AREAS TOPICS • Creation of new sustainable value chains • Creation of a new recycled products/ RE THINKING PRODUCTS IN A materials (PP, copper) CIRCULAR PERSPECTIVE • Research other sustainable value chains • Bio bases
Slide 31: The ECO PLEDGE® – SDGs and GRI alignment
The ECO PLEDGE® – SDGs and GRI alignment SUSTAINABILITY PILLARS SUPPORTED SDGS SUPPORTED GRI RE THINKING PRODUCTS IN A Until now no GRI related CIRCULAR PERSPECTIVE to new material development PROTECTING THE ENVIRONMENT 302-1:2016 | 303-3:2018 303-4:2016 | 307-1:2016 ATTENTION TO THE WELL-BEING OF T
Slide 32: The ECO PLEDGE® – Re-thinking products
The ECO PLEDGE® – Re-thinking products • Eco-Design aim is to create products which “will come back” because are conceived and built to become future resources and not wastes • Collaboration on the entire value chain is the crucial successful driver TARKETT NAPAPIJRI CORAL EYEWEAR Closing the loop i
Slide 33: The ECO PLEDGE® – Protecting the enviroment
The ECO PLEDGE® – Protecting the enviroment • Aquafil is committed to respect the environment in every phase of its own production process 302-1:2016 | 303-3:2018 303- 4:2018 | 305-1:2016 305-2:2016 | • Therefore, activities and to reduce impacts and recover energy 306-3:2020 are constant among year
Slide 34: The ECO PLEDGE® – Share responsibility along the supply chain
The ECO PLEDGE® – Share responsibility along the supply chain • Aquafil establish solid relationships with its customers and suppliers, based on the commitment and desire to improve together, 307-1:2016 | 308-1:2016 413- 1:2016 | 414-1:2016 leveraging on constant comparison and collaboration • Some
Slide 35: Index Page
Index Page 1. KEY MESSAGES 4 2. 2020 RESULTS 6 3. SPECIAL PROJECTS 22 4. SUSTAINABILITY PATH 27 5. OUTLOOK 36 6. APPENDIX 39 35
Slide 36: 2021 Outlook – ITOCHU Memorandum of Understanding
2021 Outlook – ITOCHU Memorandum of Understanding • Main topics around of the working groups • Evaluation of ITOCHU possible support in the fishing nets collection process, in Japan, then in the Asiatic area and finally in other parts of the world FISHING NETS • Considerations on possibility to sell
Slide 37: 2021 Outlook – Trading updating – Recovery trend ongoing
2021 Outlook – Trading updating – Recovery trend ongoing • January-February 2020 “first grade product” volume still not impacted by COVID • 2021 started with strong push on “first grade product” volume from Polymer market ꟷ price still impacted by raw material value compare to same period 2020 • Unt
Slide 38: 2021 Outlook – Group expectations
2021 Outlook – Group expectations • 2020 uncertainty and variability will continue in the current year in term of both pandemic course - new strains spread and vaccinations timing of in many countries worldwide – and economic scenario • On the bases available data and information, assuming no worsen
Slide 39: Index Page
Index Page 1. KEY MESSAGES 4 2. 2020 RESULTS 6 3. SPECIAL PROJECTS 22 4. SUSTAINABILITY PATH 27 5. OUTLOOK 36 6. APPENDIX 39 39
Slide 40: Index Page
Index Page 1. KEY MESSAGES 4 2. 2020 RESULTS 6 3. SPECIAL PROJECTS 22 4. SUSTAINABILITY PATH 27 5. OUTLOOK 36 6. APPENDIX – DISCLAIMER AND DEFINITIONS 40
Slide 41: Disclaimer
Disclaimer This presentation and any material distributed in connection herewith (together, the “Presentation”) prepared by Aquafil S.p.A. (“Aquafil” or “Company”) do not constitute or form a part of, and should not be construed as, an offer for sale or subscription of or solicitation of any offer t
Slide 42: Definitions
Definitions “First choice revenues” are revenues generated by the sale of fibers and polymers, gross of any adjustments «FIRST CHOICE (for example, discounts and allowances), but excluding revenues generated by “non-first choice products”, REVENUES» revenues generated by Aquafil Engineering GmbH and
Slide 43: Index Page
Index Page 1. KEY MESSAGES 4 2. 2020 RESULTS 6 3. SPECIAL PROJECTS 22 4. SUSTAINABILITY PATH 27 5. OUTLOOK 36 6. APPENDIX – SECTOR DATA 43
Slide 44: Sector Data – Caprolactam price evolution
Sector Data – Caprolactam price evolution 2018-2020 PRICE EVOLUTION €/ton. 2,500 2018: 2.123 2,000 2019: 1.896 2020: 1.529 1,500 1,000 Jan. Feb. Mar. Apr. May Jun. Jul. Aug. Sept. Oct. Nov. Dec. 2019-2020 QUARTERLY PRICE VARIATION 30% 0% -30% 4Q2019 1Q2020 2Q2020 3Q2020 4Q2020 vs. 3Q2019 vs. 4Q2019
Slide 45: Index Page
Index Page 1. KEY MESSAGES 4 2. 2020 RESULTS 6 3. SPECIAL PROJECTS 22 4. SUSTAINABILITY PATH 27 5. OUTLOOK 36 6. APPENDIX – GROUP DATA 45
Slide 46: Consolidate Income Statements
Consolidate Income Statements CONSOLIDATED INCOME STATEMENT December of wich December of wich Fourth of wich Fourth of wich €/000 2020 non- 2019 non- Quarter 2020 non- Quarter 2019 non- Revenue 436,602 current 458 548,955 current 108,672 current 171 129,418 current of which related parties 53 58 (27
Slide 47: Consolidate Income Statements – EBITDA details
Consolidate Income Statements – EBITDA details RECONCILIATION FROM NET PROFIT TO EBITDA December December Fourth Quarter Fourth Quarter €/000 2020 2019 2020 2019 Net Profit (Including Portion Attr. to Minority ) 595 9,005 3,494 (529) Income Taxes (517) 1,519 (449) (2,195) Amortisation & Depreciation
Slide 48: Consolidate Balance Sheet
Consolidate Balance Sheet CONSOLIDATED BALANCE SHEET At December 31, At December 31, €/000 2020 2019 Intangible Assets 23,578 21,101 Goodwill 13,600 13,029 Tangible Assets 229,495 251,492 Financial Assets 650 765 of which related parties 318 313 Other Assets 1,336 2,189 Deferred Tax Assets 14,563 13
Slide 49: Consolidate Balance Sheet – Gross debt details
Consolidate Balance Sheet – Gross debt details AMOUT COVENANTS ( 2 ) BORROWINGS - 31 December 2020 ISSUE DATE CURRENCY COUPON ( 1 ) MATURITY Total Drawn Undrawn Parameters Reference Check Private Placement B Sept 2018 EUR 4.70% Sept 2028 50 50 0 EBITDA / Net financial charges > 3.5 Net Debt / EBITDA
Slide 50: Net Financial Position
Net Financial Position NET FINANCIAL DEBT At December 31, At December 31, €/000 2020 2019 A. Cash 208,954 90,400 B. Other cash equivalents - - C. Securities held-for-trading - - D. Liquidity ( A + B + C) 208,954 90,400 E. Current financial receivables 834 1,637 F. Current bank loans and borrowing (1
Slide 51: Net Financial Position – Evolution and details
Net Financial Position – Evolution and details 400 NFP EVOLUTION 300 200 250 100 218 157 112 0 2017 2018 2019 2020 BREAKDOWN by CURRENCY (1) BREAKDOWN by COUPON (1) 0% 46% 54% 100% Euro USD Fixed Floating Data in € million - (1) Excluding lease liabilities and liquidity 51
Slide 52: Consolidated Cash Flow Statement
Consolidated Cash Flow Statement CASH FLOW STATEMENT At December 31, At December 31, €/000 2020 2019 Operation Activities Net Profit (Including Portion Attr. to Minority ) 595 9,005 of which related parties -689 -755 Income Taxes -517 1,519 Financial income -352 -1,195 Financial charges 7,982 7,573