Slide 1: Umicore Investor Presentation
Umicore Investor Presentation March 2020
Slide 2: Introduction to Umicore
_ umicore materials fer a bette, life duction to Umicore
Slide 3: We are a global materials technology and recycling group
We are a global materials technology and recycling group One of three global A leading supplier of key The world’s leading leaders in emission control materials for rechargeable recycler of complex waste catalysts for light-duty and batteries used in electrified streams containing heavy-duty vehicle
Slide 4: With a unique position in clean mobility materials and recycling
With a unique position in clean mobility materials and recycling Internal Plug-In Hybrid Combustion Engine Electric Vehicle Umicore provides: Umicore provides: Emission control catalysts Battery cathode materials and emission control catalysts Full Electric Vehicle Fuel cells Umicore provides: Umico
Slide 5: Built on sound foundations
Built on sound foundations Supportive Unique business Industry leader in megatrends & model sustainability legislation resource scarcity more stringent emission control electrification recycling recycling of the automobile We help improve air quality, make electrified transport possible and tackle r
Slide 6: With a robust financial performance and a global presence
With a robust financial performance and a global presence Key figures (FY 2019) Recurring Revenues EBITDA € 3.4 bn € 753 m Recurring ROCE EBIT 12.6% € 509 m 40% - Europe Revenues* by geography 14% - North America 4% - South America 39% - Asia-Pacific * 2019 data 3% - Africa 6
Slide 7: We deliver on our Horizon 2020 strategy
We deliver on our Horizon 2020 strategy Clear leadership Doubled the size in clean mobility of the business in materials and terms of earnings recycling Rebalanced the Turned portfolio sustainability into & earnings a greater contributions competitive edge 7
Slide 8: With a focused & balanced Group structure
With a focused & balanced Group structure CATALYSIS ENERGY & SURFACE RECYCLING TECHNOLOGIES Automotive Catalysts Rechargeable Battery Materials Precious Metals Refining Precious Metals Chemistry Cobalt & Specialty Materials Jewelry & Industrial Metals Electroplating Precious Metals Management Electr
Slide 9: Unique position in Automotive Catalysts
Unique position in Automotive Catalysts Strong growth drivers: Umicore best positioned to Tightening emission norms for capture growth in growing LDV and HDD, in particular in gasoline segment; largest share China, Europe and India of cGPF platforms won in China and Europe Significant value uplift e
Slide 10: Unique position in Rechargeable Battery Materials for xEV
Unique position in Rechargeable Battery Materials for xEV Electrification confirmed as main avenue to drastically reduce vehicle emissions in mid- and Umicore uniquely positioned to address long-term long-term requirements of this industry, while managing short-term fluctuations Strongly supported b
Slide 11: Unique position in Recycling
Unique position in Recycling RECYCLING Metallurgical leadership and proprietary technologies for Increasing resource scarcity and need for closing the treating complex residues and by- loop products Growing complexity of materials to recycle Closing the loop Increased availability of complex materia
Slide 12: We have a solid framework for value creation
We have a solid framework for value creation Focus on Strong Focus on cashflows and growth returns solid capital structure • Multiple growth drivers • Earnings growth objective • Prioritize cash for strategic • Secular trends • Group and segment organic growth projects • Supporting legislation retur
Slide 13: Maintaining a healthy capital structure
Maintaining a healthy capital structure 35,2% 31,1% 2000 24,4% 2,00 1800 1,92 1,80 15,3% 13,8% 1600 1,60 1,40 1443 Gearing 1400 1,40 ratio 1,19 1200 1,20 1000 840 1,00 861 800 0,80 Net debt 0,64 0,56 / recurring EBITDA 600 0,60 400 321 296 0,40 200 0,20 Consolidated net 0 0,00 financial debt,
Slide 14: Business Group Overview: Catalysis
Business Group Overview Catalysis
Slide 15: Catalysis
Catalysis A world leader in emission control catalysts for light-duty and Automotive heavy-duty vehicles and for all fuel types. Complemented by Catalysts smaller stationary catalyst applications (marine, power generation, …). Precious Develops and produces metal-based catalysts used in chemistry, M
Slide 16: Automotive Catalysts: business model
Automotive Catalysts: business model We develop technologies which allow our customers to meet automotive emission legislation at the lowest Total Cost of Ownership Complete catalyst systems Customer to reduce exhaust focus gas emissions People Operational engagement excellence Global manufacturing
Slide 17: Automotive Catalysts Production Footprint
Automotive Catalysts Production Footprint 19 plants in 14 countries, 10 R&D / tech. centers in 7 countries Frederikssund Karlskoga Lyngby Nowa Ruda Songdo Denmark Sweden Denmark Poland Korea Onsan Burlington Hanau Korea Canada Germany Tokoname Auburn Hills, MI Florange Japan USA France Kobe Japan Tu
Slide 18: Catalysis 2019 market context
Catalysis 2019 market context Recession in global car market More stringent emission norms in key regions Global light-duty vehicle production down by Euro 6d TEMP for all new vehicles since 6.3% year on year: September 2019 China - 8.9% Europe - 5.0% Early implementation of China 6a in July 2019 No
Slide 19: Catalysis 2019 performance
Catalysis 2019 performance Revenues +7% and REBIT +10%; outperforming market reflecting market share gains in light-duty gasoline REVENUES 1500 1.360 1.460 1.253 1.094 1.163 Automotive Catalysts 1000 620 652 743 545 565 Market share gains in light-duty gasoline 500 Growing penetration of cGPFs in Ch
Slide 20: Catalysis – major milestones in 2019
Catalysis – major milestones in 2019 Capacity expansions Sustained investments Opening of new plant to support growth of in product and for fuel cell catalysts Automotive Catalysts in process innovation in Korea China, Poland and India 20
Slide 21: Impressions
Impressions Bad-Säckingen plant AC, Germany Catalyst elements Test bench Installation stationary DNox catalyst Nowa Ruda plant AC, Poland Canned catalyst 21
Slide 22: Business Group Overview: Energy & Surface Technologies
Business Group Overview Energy & Surface Technologies
Slide 23: Energy & Surface Technologies
Energy & Surface Technologies Rechargeable A leading cathode material supplier for lithium-ion rechargeable Battery batteries used in electrified vehicles and portable electronics. Materials Cobalt & Refines and recycles cobalt and nickel; produces cobalt and Specialty nickel specialty chemicals for
Slide 24: Rechargeable Battery Materials: business model
Rechargeable Battery Materials: business model Product innovation Process innovation based on strong fuels productivity application know-how improvements while maintaining highest quality standards (stringent Established industrial automotive standards) footprint close to the customer Integrated pro
Slide 25: It takes a lot to play in the automotive league
It takes a lot to play in the automotive league Car OEMs need : High quality cathode materials excellent product quality on 20+ specs • … custom made for different types of xEVs wide spectrum of cathode material technologies • … in massive volumes industrial capabilities • … at the highest speed and
Slide 26: Product, process and supply
Product, process and supply Key success factors 3 Supply 1 Product Technology 2 Process Technology Raw Industrial Lab scale Pilot scale materials scale • Feed flexibility • Ability to scale up fast Wide spectrum of cathode • Cost-efficient processes • Battery recycling material technologies • Indust
Slide 27: Cathode material specs to fulfil cell performance specs
1 Cathode material specs to fulfil cell Product technology performance specs Cathode material Cathode material product specs performance specs • Particle size • Packing • Capacity • Safety • Morphology density • Power • Charge • Composition • Porosity (charge/discharge) efficiency • Purity • Consist
Slide 28: Rechargeable Battery Materials: expansion projects timeline
2 Rechargeable Battery Materials Process technology Expansion projects timeline Year 2016 2017 2018 2019 2020 2021 2022 2023 EUR 160 million announced April 2016 Brownfield in China Greenfield in Korea Completed on accelerated schedule Significant scale effects that EUR 300 million benefitted 2018 m
Slide 29: Access to raw materials
3 Access to raw materials Supply Unique integration in the value chain Raw material Metal Product Application End use Umicore • Flexibility in supply feed, high speed to market and responsiveness to customer needs 29
Slide 30: Access to raw materials: battery recycling
3 Access to raw materials Supply Battery recycling as critical additional source of supply • Umicore is fully aligned with OECD Due Diligence for Responsible Supply Chains of Minerals from Conflict-Affected and High-Risk Areas • Certified clean and ethical supply to our customers • Urban mining indi
Slide 31: E&ST 2019 market context
E&ST 2019 market context Slowdown in global EV demand and low cobalt price Global EV market up 7.7% in 2019 compared to 62% in 2018, reflecting abrupt decline in EV sales in China in H2 due to subsidy cuts LCO in consumer electronics: supply chain reducing excess inventories ESS in Korea: subdued de
Slide 32: E&ST 2019 performance
E&ST 2019 performance Revenues -5%; REBIT -29% reflecting slowdown in demand and low cobalt price REVENUES 1500 Rechargeable Battery Materials 1.289 1.225 Lower sales for portable electronics and ESS 894 1000 639 Higher sales for EVs, in line with global EV market 618 587 610 495 Recycling and refin
Slide 33: E&ST – major milestones in 2019
E&ST – major milestones in 2019 Capacity expansions • Commissioning greenfield Commissioning of Acquisition of cobalt refinery plant in China new Process and cathode precursor Competence Center activities in Kokkola, Finland • Start of construction greenfield plant in Poland (Olen, Belgium) Support
Slide 34: Impressions
Impressions EV car battery pack Packaging finished product RBM Cheonan production sites, Korea 34
Slide 35: Business Group Overview: Recycling
Business Group Overview Recycling
Slide 36: Recycling
Recycling Operates the world’s most sophisticated precious metals recycling facility Precious Metals and recovers 17 precious and other valuable metals from complex waste Refining streams. Precious Metals Services for hedging, leasing, purchasing and sale of precious and Management platinum group me
Slide 37: Precious Metal Refining
Precious Metal Refining Largest and most complex precious metals recycling operation in the world Leading refiner of 17 different metals Processes more than 200 different types of raw materials World class environmental and quality standards 37
Slide 38: The value chain of metals
The value chain of metals Ores & Refined New concentrates metals products Smelters Consumers Mines Industry & refiners Complex mining Smelting Complex Complex concentrates & refining production end-of-life & residues residues scrap materials Industrial by-products End-of life materials 3838
Slide 39: Revenue Drivers
Revenue Drivers Main revenue drivers Treatment & refining Metal yield charges Treatment charges are Umicore assumes the risk determined, among other of recovery above or criteria, by the complexity under the contractually of the materials agreed recovery rate 39
Slide 40: Metal price exposure
Metal price exposure Managing the effects of metal price movements Direct: Indirect: on earnings through metal through raw Systematic hedging of yield material availability transactional exposure Depending on market conditions hedging of (part of) structural metal price exposure through contractual
Slide 41: Umicore has unique technology
Umicore has unique technology Umicore is unique due to its proprietary complex flowsheet that combines three metallurgical streams This enables Ability to optimize Flexibility to treat Recovery & Scope to broaden feed and a broad range of valorization of the to new types of therefore input materials
Slide 42: Recycling 2019 market context
Recycling 2019 market context Supportive metal prices and favorable supply environment Supportive metal price environment Higher prices for certain precious and platinum group metals, particularly in the second half of 2019 Favorable supply environment with increased availability of complex end-of-l
Slide 43: Recycling 2019 performance
Recycling 2019 performance Revenues +9%; REBIT +40% reflecting favorable supply mix, higher metal prices and optimization of input mix REVENUES 1.000 Precious Metals Recycling 800 663 641 650 626 681 600 Higher availability of spent autocats and printed circuit 320 318 311 300 368 boards 400 Higher
Slide 44: Recycling – major milestones in 2019
Recycling – major milestones in 2019 Completion of multi- Investments to sustain Upgrade of key year expansion and improve the equipment during program at Hoboken environmental extended shutdown plant performance of the plant Umicore H1 2019 performance 44
Slide 45: Impressions
Impressions PMR Hoboken recycling plant, Belgium 45
Slide 46: Financials FY 2019
_ umicore materials fer a bette, life Financials FY 2019
Slide 47: Key figures 2019
Key figures 2019 REVENUES REBIT Free Operating Cash Flow +3% to € 3.4 bn € 509 m, close to 2018 € -39 m (€ -406 m in FY 18) Strong growth in Catalysis (+7%) record level Net debt € 1,443m and Recycling (+9%) partly offset Balanced contribution from the Net debt / REBITDA 1.9x by decline in E&ST (-5%
Slide 48: Robust performance in challenging market context
Robust performance in challenging market context REBIT & REBIT margin Recurring EBIT at € 509 m, close to 700 15,5% 14,8% record level of 2018 600 13,2% CAGR 12,2% 12,6% Double digit growth in Recycling and 500 514 509 2015-2019 400 299 320 398 252 + 11 % Catalysis offset by decrease in E&ST 269 300
Slide 49: Strong sequential earnings growth in second half
Strong sequential earnings growth in second half REBIT & REBIT margin Strong H2 19 performance after more 300 12,8% 12,8% 13,5% 13,0% 15,2% 15,9% 14,3% 15,3% challenging H1 19 250 11,6% 12,3% 269 Strong sequential and year-on-year growth in H2 261 252 240 200 203 195 150 Mostly driven by Recycling (
Slide 50: Improvement in free operating cash flows
Improvement in free operating cash flows million €, continued operations only 1000 800 627 500 549 Cash flow from operations highest in 0 92 last five years at € 549 m -78 -500 Includes a € 78 m increase in working capital -708 -1000 requirements, mostly driven by impact of FY15 FY16 FY17 FY18 FY19
Slide 51: Net cash flow bridge
Net cash flow bridge million € Free operating cashflow of € - 39 m (€ - 406 m in 2018) € 188 m cash out linked to the Kokkola acquisition Increased dividend payout to Umicore shareholders (€ 186 m vs € 175 m in 2018) Increase in net financial debt of € 582 m, including non-cash increase of € 46 m fr
Slide 52: Further extension of funding base
Further extension of funding base Issuance of € 390 m US private placement notes, Committed medium & long term complementing existing committed credit facilities: facilities Historically low, fixed interest rates Total of € 1,875 m Maturities of 7, 10 and 12 years 2000 1800 Total of committed medium
Slide 53: 2020 Outlook
:; umicore materials fr a better life 2020 Outlook
Slide 54: Outlook 2020
Outlook 2020 As communicated in April 2019, Umicore expects to grow revenues and earnings in 2020 despite a deterioration in the global macro-economic environment since then, particularly in the automotive sector. This growth outlook assumes that the recent coronavirus outbreak will not result in a
Slide 55: Key Investment Considerations
Key Investment Considerations
Slide 56: Key investment considerations
Key investment considerations • Well positioned to take advantage of accelerating global megatrends : more stringent emission control, electrification of the automobile and resource scarcity • Global presence and unique competences acquired over many years; • A market leader in most key product mark
Slide 57: Forward-looking statements
Forward-looking statements This presentation contains forward- Should one or more of these risks, looking information that involves risks uncertainties or contingencies materialize, and uncertainties, including statements or should any underlying assumptions about Umicore’s plans, objectives, prove
Slide 58: umicore
. umicore materials-fr a better, life