Kingspan Group Plc · EURONEXT:KRX
Kingspan — H1 2021 Earnings Presentation
34 slides from Kingspan's earnings presentation, Aug 20, 2021
Slide 1: 2021 Interim Results
2021 Interim Results 20TH AUGUST 2021
Slide 2: Disclaimer
Disclaimer Forward Looking Statements This presentation contains certain forward- looking statements including, without limitation, the Group’s financial position, business strategy, plans and objectives of management for future operations. Such forward-looking information involves risks and uncerta
Slide 3: H1 2021 in Summary
H1 2021 in Summary REVENUE Insulated Panels sales increase of 44% driven by strong momentum in construction activity, raw material led price growth further enhanced by strong demand in high growth sectors. Order backlog strongly ahead of €2.9bn the same point in 2020 +41% Insulation Boards sales
Slide 4: Our Mission
Our Mission Ultra Energy-Efficient To accelerate a net zero emissions future 196 million* tonnes of CO2e will built environment with the wellbeing of be saved over the life of our insulation systems sold in 2021 people and planet at its heart. Net Zero Carbon Over 8%* reduction in absolute Scope 1 &
Slide 5: The Envelope and the Arteries
The Envelope and the Arteries Light & Air Global Leader Water & Energy Flat Roof Membrane 8% Revenue Global Leader Embryonic position presently – 4% Revenue global scale opportunity Technical Insulation Developing position presently – global scale opportunity Insulated Panels Global Leader 66% Reven
Slide 6: Megatrends That Drive Us
Megatrends That Drive Us Politics and Regulation Averting a climate emergency Paris Agreement goal to limit the temperature increase above pre-industrial levels to 1.5ºC Market and Customers Sustainability and Resilience Society and Workforce Future proofing of asset values Resource Scarcity Health/
Slide 7: Building(s) For The Future
Building(s) For The Future Auto and Battery Logistics and Data Centre Solutions The Space Economy Manufacturing Distribution Global sales of Western Europe Global mobile data The global space economy electric cars grew e-commerce sales grew traffic has grown generates approximately 43% 29% 10x $350b
Slide 8: IPCC 1.5ºC – AECOM Research
IPCC 1.5ºC – AECOM Research1 Embodied carbon in buildings also needs to The rate of retrofits be reduced through needs to dramatically low carbon accelerate and extend to deep energy materials and building designs. refurbishment: 4%/year Refurbishment is inherently lower embodied carbon than new-bui
Slide 9: Better Insulation is the Cornerstone of Envelope First
Better Insulation is the Cornerstone of Envelope First OPTIM-R ® (0.007 W/mK)3 KINGSPAN’S FULL SPECTRUM Insulates Better Kooltherm® 100 QuadCore™ (0.018 W/mK)3 PIR (0.018 W/mK)3 (0.018-0.023)2 (0.022 W/mK)3 (0.022-0.027)2 Synthetic EPS XPS (0.030 W/mK)3 (0.030 W/mK)3 Mineral (0.030-0.038)2 (0.030-0.
Slide 10: Product Integrity
Product Integrity Leading Standard in Compliance Oversight Framework 17 Kingspan Group’s Compliance Kingspan Compliance Team Lead Product Compliance 50 function has been accredited to has audited Officers appointed across the business. ISO 37301 manufacturing facilities to date, with a further 30 pl
Slide 11: Solutions Driven Innovation
Solutions Driven Innovation QuadCore™ versus Synthetic Mineral Fibre1 Market and Sustainability and Society and Politics and Customers Resilience Workforce Regulation 25% lower panel system cost2 297 fewer truck deliveries to site 12% savings in installation time (faster build programme) 40year warr
Slide 12: Space Matters
Space Matters UK Industrial/Office Description Value Kingspan External Wall Kingspan QuadCoreTM Construction KS1000RW sandwich panels Lettable floor area 35,800 sq.m (385,348 sq.ft) Additional floor area 87.10 sq.m (937.54 sq.ft) Additional development cost £71,379 Capitalised value of £275,667 addi
Slide 13: Planet Passionate 2021 Forecast
Planet Passionate 2021 Forecast TARGET TARGET YEAR 2020 (A) 2021 (F) Net Zero Energy (%) 2020 100% 100% ENERGY 60% direct renewable energy use (%) 2030 28% 30% 20% on-site renewable energy generation (%) 2030 4.7% 5% Solar PV systems on all wholly owned facilities (%) 2030 21% 29% Net zero carbon ma
Slide 14: Circularity & QuadCore – the LIFECycle approach
Circularity & QuadCoreTM – the LIFECycle approach Factory Processes By 2030, all factories across the world making QuadCoreTM panels will be zero waste to landfill. Input Materials QuadCoreTM panels Extended Life contain up to 25% recycled steel and will contain recycled QuadCoreTM’s feedstocks in r
Slide 15: Global Organic Expansion
Global Organic Expansion UK AlphaCore® Pilot Line 2022 Sweden Kooltherm® Facility 2021 Kingscourt, Ireland Light & Air Facility 2021 Central France PIR Panel Line 2022 PIR Board Line 2023 Russia New Panel Line 2021 Mid West USA North East USA New Panel Line 2023 New Panel Line 2021 Dubai, UAE Insula
Slide 16: Key Innovations
Key Innovations PowerPanel® 2.0 FibreFree AlphaCore™ QuadCore™ Rollout \\ i eo SS a | | en eee ee Ce B-Class Kooltherm® A-Class Optim-R Kingspan, 16
Slide 17: Progress so Far
Progress so Far CAGR 16.9% 6.0 Sales (€bn) 2021 CONSENSUS 5.5 5.0 4.5 4.0 3.5 3.0 2.5 2.0 1.5 1.0 0.5 0.0 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 20 21 17
Slide 18: 5 Year Financial Performance
5 Year Financial Performance REVENUE (€m) TRADING PROFIT (€m) CAGR (13.0%) CAGR (14.7%) 654.3 5,970.3 4,659.1 508.2 4,576.0 497.1 4,372.5 445.2 3,668.1 377.5 2017 2018 2019 2020 2021* 2017 2018 2019 2020 2021* 2017 2018 2019 2020 2021* * Analyst consensus * Analyst consensus 18
Slide 19: H1 2021 In a Nutshell
H1 2021 In a Nutshell 8% 66% 17% Light & Air Products 5% Data & Flooring Insulated Panels Insulation Boards 4% Water & Energy Revenue Drivers 85% 15% €2.9 Billion Energy Efficiency & Conversion Other Geographic Regions 37% Western & 23% Central & 18% 16% 6% Applications - Retail - Distribution South
Slide 20: Financial Highlights
Financial Highlights YoY % H1 2021 H1 2020 cc change* Change Revenue (€m) 2,920.1 2,072.7 +41% +44% Trading Profit (€m) 328.9 200.1 +64% +67% Earnings per share (cent) 132.4 79.8 +66% - Interim Dividend (cent) 19.9 - - - Free Cashflow (€m) 141.8 260.4 -46% - Net Debt (€m) 601.7 437.9 +37% - Trading
Slide 21: Trading Profit and Margin
Trading Profit and Margin TRADING PROFIT (€m) CAGR (16.7%) TRADING MARGIN H1 21 FY 20 H1 20 Insulated Panels 11.6% 11.0% 9.3% Insulation Board 14.0% 14.0% 13.2% Light & Air 2.7% 7.0% 4.4% 328.9 Water & Energy 9.4% 8.0% 7.4% Data & Flooring 12.9% 13.1% 12.8% 230.4 Group 11.3% 11.1% 9.7% 200.1 195.3 1
Slide 22: Group Sales & Profit Bridge
Group Sales & Profit Bridge Revenue €m Trading Profit €m 734.2 166.1 119.7 (52.9) 14.8 (5.7) 328.9 2,920.1 2,072.7 200.1 Revenue H1 Currency Acquisitions Underlying Revenue H1 Trading Profit Currency Acquisitions Underlying Trading Profit 20 21 H1 20 H1 21 22
Slide 23: Strong Free Cash Flow (€m)
Strong Free Cash Flow (€m) (118.5) 6.6 (18.5) (40.9) 373.4 (60.3) 141.8 EBITDA Working Capital Non Cash Interest Tax Net Capex Free Cash Flow 23
Slide 24: Net Debt Reconciliation (€m)
Net Debt Reconciliation (€m) (15.1) 39.6 5.0 46.9 601.7 430.9 (141.8) 236.2 0 Net Debt Dec 20 Free Cash Flow Acquisitions Financial Asset Repurchase of Dividends Paid FX/Other Net Debt Jun 21 Shares 24
Slide 25: Strong ROCE
Strong ROCE 18.9% 18.4% 17.8% 17.3% 16.8% Train Maintenance Facility, Australia Insulated Panels 2017 2018 2019 2020 H1 21 25
Slide 26: Sales by Geography
Sales by Geography 37% 35% 6% Western & Southern Europe Central & Northern Europe 7% H1 21 Americas H1 20 Britain 16% 23% 21% Rest of World 16% 18% 21% YoY % €m H1 21 H1 20 cc change* Change Western & Southern Europe 1,086.2 734.2 +48% +48% Central & Northern Europe 657.8 438.2 +50% +51% Americas 53
Slide 27: Insulated Panels
Etihad Arena, Abu Dhabi Insulated Panels Strong momentum in H1 2021 Revenue and volume strongly ahead and order intake Insulated Panels volume was up +50% leaving backlog over double that at June 2020 Construction activity clearly ahead in most markets, further enhanced by increased penetratio
Slide 28: Insulated Panels
Work commenced on a new Insulated Panel facility in Central France due for completion in late 2022 In North America work is progressing on a new greenfield Insulated Panels facility in the north east and an additional greenfield plant will be added in the midwest region Brazil has commenced pr
Slide 29: Insulation Boards
Shopping Centre, Abu Dhabi Insulation Boards Sales value and volume were both well ahead of last year in all Insulation Boards key markets Newbuild has recovered strongly in many regions Western Europe and North America posted significant volume increases and momentum in Australasia has improv
Slide 30: Light & Air
Significant step forward in 2020 with the acquisition of Colt, adding material scale to the division and revenue of c. €250m Geographically, Colt resulted in Northern Europe taking a leap forward, in particular Germany and the Netherlands Light & Air Most recently Skydome entered the fold whic
Slide 31: Water & Energy
Robust performance with notable growth in most geographic regions Product portfolio ranges from rainwater harvesting to water Water & Energy treatment and hot water storage Solid activity in the Britain and Poland across water treatment and fuel storage product sales University of Queensland M
Slide 32: Data & Flooring
Relatively strong performance with sales and trading profit ahead by 22% and 23% respectively Data & Flooring Predominant focus on unique solutions aimed at efficient running of data warehouses Product suite includes airflow panels, aisle containment and structural ceilings, all designed to mi
Slide 33: Outlook
Outlook Very positive first half with strong order backlog entering second half of year Raw material inflation and constrained availability theme to persist through remainder of 2021 and likely into 2022 Construction industry activity has been lively in most key markets with outperformance by
Slide 34: Dublin Road Kingscourt, Co Cavan Ireland, A82 XY31
Dublin Road Kingscourt, Co Cavan Ireland, A82 XY31 Tel: +353 42 969 8000 Email: admin@kingspan.com www.kingspan.com 34