Novonesis A/s Class B · OMXCOP:NSIS_B
Novonesis A/s Class B — Novozymes — Non-Deal Roadshow (January 2014)
58 slides from Novonesis A/s Class B's roadshow presentation, Jan 21, 2014
Slide 1: Roadshow Presentation FY 2013
ROADSHOW PRESENTATION FY 2013 January 21, 2014
Slide 2: Table of Contents
Table of Contents Table of Contents 2 1. FY 2013 presentation 3-11 2. Novozymes Overview 12-18 3. Strategy 19-27 4. Segmental Overview 28 Household Care 29-31 Food & Beverages 32-33 Bioenergy 34-37 Agriculture & Feed 38-41 Technical & Pharma 42-44 5. Sustainability 45-49 6. Financial Revie
Slide 3: Quarterly Results
FULL YEAR RESULTS • NOVOZYMES OVERVIEW • STRATEGY • SEGMENTAL OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW QUARTERLY RESULTS QUARTERLY RESULTS • OVERVIEW • STRATEGY • SEGMENTAL OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW
Slide 4: Safe Harbor Statement
FULL YEAR RESULTS • NOVOZYMES OVERVIEW • STRATEGY • SEGMENTAL OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW Safe Harbor Statement This presentation and its related comments contain forward- looking statements, including financial expectations. Forward-looking statements are by their very nature assoc
Slide 5: Full-Year 2013 Summary
FULL YEAR RESULTS • NOVOZYMES OVERVIEW • STRATEGY • SEGMENTAL OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW Full-Year 2013 Summary 2013 performance as expected 2011-2013 DKKm sales and org. growth • 7% organic sales growth (5% in DKK) driven by all 12% 12,000 industries, primarily Household Care and
Slide 6: Sales & Markets
FULL YEAR RESULTS • NOVOZYMES OVERVIEW • STRATEGY • SEGMENTAL OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW Sales & Markets FY 2013 sales: DKK +5%, LCY +8%, org. +7% Sales by industry, DKKm Q4 2013 sales: DKK +5%, LCY +9%, org. +8% 2013 2012 • Household Care: Sales continued on growth track, Hous
Slide 7: The BioAg Alliance with Monsanto
FULL YEAR RESULTS • NOVOZYMES OVERVIEW • STRATEGY • SEGMENTAL OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW The BioAg Alliance with Monsanto - Aiming to Build Next Important Yield Platform for Farmers INTEGRATED SYSTEM EMERGING TRENDS • Multiple components converging to • Replacing agricultural input
Slide 8: 2013 – A Year of Significant Innovation
FULL YEAR RESULTS • NOVOZYMES OVERVIEW • STRATEGY • SEGMENTAL OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW 2013 – A Year of Significant Innovation The BioAg Alliance 11 products launched in 2013 • Combination of Novozymes and Monsanto establishes • Significant innovation brought industry's most adva
Slide 9: Manufacturing Performance
FULL YEAR RESULTS • NOVOZYMES OVERVIEW • STRATEGY • SEGMENTAL OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW Manufacturing Performance Satisfactory gross margin on par with 2012 Gross margin development, 2000-2013 58% 57.2% • Acquisitions and currencies had a negative 56.2% impact 56% 55.6% 57.2% • Gr
Slide 10: Sustainability Performance and Targets
FULL YEAR RESULTS • NOVOZYMES OVERVIEW • STRATEGY • SEGMENTAL OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW Sustainability Performance and Targets 2013 sustainability performance: good progress, but not all targets met 2013 2013 Targets target realized 2014 target Water efficiency (index 2005) 35% 33
Slide 11: 2013 Financial Performance & 2014 Outlook
FULL YEAR RESULTS • NOVOZYMES OVERVIEW • STRATEGY • SEGMENTAL OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW 2013 Financial Performance & 2014 Outlook Satisfactory results for 2013 Realized Outlook for • Sales growth picked up from 2012 Key financials 2013 2014 • Record-high EBIT margin despite negati
Slide 12: Overview
FULL YEAR RESULTS • NOVOZYMES OVERVIEW • STRATEGY • SEGMENTAL OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW INVESTOR PRESENTATION OVERVIEW QUARTERLY RESULTS • OVERVIEW • STRATEGY • SEGMENTAL OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW
Slide 13: Novozymes – The World Leader in Bioinnovation
FULL YEAR RESULTS • NOVOZYMES OVERVIEW • STRATEGY • SEGMENTAL OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW Novozymes – The World Leader in Bioinnovation Who are we? Founded 1925 Listed 2000 Global: +6,000 employees, 700 products in 140 countries Ticker NZYM B Exchange Copenhagen Market Cap* US$ 13bn
Slide 14: Experienced Leadership Team Exploring Growth & Value Creation Opportunities
FULL YEAR RESULTS • NOVOZYMES OVERVIEW • STRATEGY • SEGMENTAL OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW Experienced Leadership Team Exploring Growth & Value Creation Opportunities Peder Holk Nielsen Thomas Videbæk Per Falholt Benny Loft Thomas Nagy Andrew Fordyce Per Falholt Peder Holk Nielsen An
Slide 15: Delivering Tomorrow's Solutions Today
FULL YEAR RESULTS • NOVOZYMES OVERVIEW • STRATEGY • SEGMENTAL OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW Delivering Tomorrow’s Solutions Today Delivering solutions from Helping companies This unique approach nature: become more efficient: leads to: food applications, detergents, energy efficiency,
Slide 16: Uniquely Diversified Group
FULL YEAR RESULTS • NOVOZYMES OVERVIEW • STRATEGY • SEGMENTAL OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW Uniquely Diversified Group - Creates Synergies and New Opportunities • Unique biotech-focused business with a strong legacy of delivering growth, earnings, and cash flow • ~13-14% of annual sal
Slide 17: Diversification in Revenue Streams Underpins Financial Position
FULL YEAR RESULTS • NOVOZYMES OVERVIEW • STRATEGY • SEGMENTAL OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW Diversification in Revenue Streams Underpins the Company’s Strong Financial Position • Sales FY 2013 of DKK 11.7 bn (USD ~ 2.1 bn) • Strong profitability, 24.7% in EBIT margin FY 2013 • ROIC of
Slide 18: Global Production and R&D Setup
FULL YEAR RESULTS • NOVOZYMES OVERVIEW • STRATEGY • SEGMENTAL OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW Global Production and R&D Setup Milwaukee, Wisconsin BioAg production Nottingham, England Bagsværd, Denmark Saskatoon, Canada Biopharma production Headquarters BioAg production (Albumin
Slide 19: Strategy
FULL YEAR RESULTS • NOVOZYMES OVERVIEW • STRATEGY • SEGMENTAL OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW INVESTOR PRESENTATION STRATEGY QUARTERLY RESULTS • OVERVIEW • STRATEGY • SEGMENTAL OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW
Slide 20: Undisputed Market Leader Expanding Enzyme Application
FULL YEAR RESULTS • NOVOZYMES OVERVIEW • STRATEGY • SEGMENTAL OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW Undisputed Market Leader Expanding Enzyme Application Global enzyme market value: 2000: 2013: Global enzyme market value DKK ~ 12bn DKK ~ 22bn 2013: DKK ~ 22bn Novozymes Rest of Novozymes Rest
Slide 21: Multiple Drivers Create a Sustainable Business with Significant Growth Potential
FULL YEAR RESULTS • NOVOZYMES OVERVIEW • STRATEGY • SEGMENTAL OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW Multiple Drivers Create a Sustainable Business with Significant Growth Potential Drivers Ambition • Energy efficiency Long-term financial targets: • Cost/performance > 10% sales growth • Waste
Slide 22: How Do We Get To +10% from 2015?
FULL YEAR RESULTS • NOVOZYMES OVERVIEW • STRATEGY • SEGMENTAL OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW How Do We Get To +10% from 2015? • History shows potential to grow 10% from a diversified set of industries, but not consistently • Consistent performance in existing business will lay foundati
Slide 23: 1. Drive Innovation
FULL YEAR RESULTS • NOVOZYMES OVERVIEW • STRATEGY • SEGMENTAL OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW 1. Drive Innovation – Because Innovation Drives Top-Line Growth • Achieving growth through R&D investment remains a fundamental priority • >50 new product in the last 5 years, ~100 active proje
Slide 24: 2. Expand Opportunities
FULL YEAR RESULTS • NOVOZYMES OVERVIEW • STRATEGY • SEGMENTAL OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW 2. Expand Opportunities; Developing new technology and business platforms Continued development in …creates opportunities to develop our technology base… new business platform Biomass Strain de
Slide 25: Business Development Nurtures Tomorrow's Business
FULL YEAR RESULTS • NOVOZYMES OVERVIEW • STRATEGY • SEGMENTAL OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW Business Development Nurtures Tomorrow’s Business for Novozymes • Responsible for new business areas and Novozymes’ entire pipeline prioritization • Close coordination on pipeline, resource all
Slide 26: 3. Enzyme Technology Improves Profitability
FULL YEAR RESULTS • NOVOZYMES OVERVIEW • STRATEGY • SEGMENTAL OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW 3. Enzyme Technology Improves Profitability • Focused on improving margins through sophisticated technological solutions • Achieved sales CAGR of 7% since 2000 with improving margins • Roughly
Slide 27: Cash Generation, Use, Capex and Future Priorities
FULL YEAR RESULTS • NOVOZYMES OVERVIEW • STRATEGY • SEGMENTAL OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW Cash Generation, Use, Capex and Future Priorities – DKK billion Cash generation has tracked EBIT Cash for growth and shareholders 3.5 4.0 3.0 3.5 3.0 2.5 2.5 2.0 2.0 1.5 1.5 1.0 1.0 0.5 0.5 0.0
Slide 28: Segmental Overview
FULL YEAR RESULTS • NOVOZYMES OVERVIEW • STRATEGY • SEGMENTAL OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW INVESTOR PRESENTATION SEGMENTAL OVERVIEW QUARTERLY RESULTS • OVERVIEW • STRATEGY • SEGMENTAL OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW
Slide 29: Household Care Overview
FULL YEAR RESULTS • NOVOZYMES OVERVIEW • STRATEGY • SEGMENTAL OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW Household Care Overview Household Care (36% of 2013 sales) Household Care Sales Sales DKK LCY growth 4,5 00 40% 4,222 4,2 50 3,973 4,0 00 35% 3,514 3,7 50 Laundry & dishwasher detergents 3,324
Slide 30: Enzymes are Gaining Traction in Detergents
FULL YEAR RESULTS • NOVOZYMES OVERVIEW • STRATEGY • SEGMENTAL OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW Enzymes are Gaining Traction in Detergents The advantages of ..drive new product ..increasing the enzymes.. launches.. overall penetration of enzymes # of detergents containing Share of deterge
Slide 31: Replacing Chemicals in Detergents
FULL YEAR RESULTS • NOVOZYMES OVERVIEW • STRATEGY • SEGMENTAL OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW Replacing Chemicals in Detergents Raw mat. cost distribution in Raw mat. cost distribution top-tier powder detergent Benefits: in top-tier liquid detergent Surfactan • Reduce oil price sensitiv
Slide 32: Food & Beverages Overview
FULL YEAR RESULTS • NOVOZYMES OVERVIEW • STRATEGY • SEGMENTAL OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW Food & Beverages Overview Food & Beverages (27% of 2013 sales) Food & Beverages Sales Sales DKK LCY growth 4,0 00 40% 3,7 50 Baking / Starch conversion / Brewing / 35% Application 3,5 00 Bevera
Slide 33: Fill and Manage the Pipeline
FULL YEAR RESULTS • NOVOZYMES OVERVIEW • STRATEGY • SEGMENTAL OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW Fill and Manage the Pipeline - Enzyme Innovation to the Food Industry Informed New economies Health & Wellbeing Convenience consumption and urbanization Reinforce customers’ Reduce costs Apply
Slide 34: Bioenergy Overview
FULL YEAR RESULTS • NOVOZYMES OVERVIEW • STRATEGY • SEGMENTAL OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW Bioenergy Overview Bioenergy (16% of 2013 sales) Bioenergy Sales Sales DKK LCY growth 2,5 00 70% 2,2 50 60% Application Corn ethanol / Biomass conversion 2,0 00 1,846 1,909 1,782 1,748 50% 1,7
Slide 35: Production of Biofuels and Beyond
FULL YEAR RESULTS • NOVOZYMES OVERVIEW • STRATEGY • SEGMENTAL OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW Production of Biofuels and Beyond Raw material Production process End product Sugarcane Extraction Ethanol Co-products Bagasse; Energy Fermentable sugar Classical Butanol Milling Cooking Enzyme
Slide 36: Many More Potential Customers Interested in Biomass Conversion
FULL YEAR RESULTS • NOVOZYMES OVERVIEW • STRATEGY • SEGMENTAL OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW Many More Potential Customers Are Interested in Biomass Conversion Today than 5 Years Ago • The number of projects choosing enzymatic hydrolysis conversion has increased from 7 in 2008 to 26 in
Slide 37: Biomass Conversion; Food, Feed, Fuel, Chemicals and Materials
FULL YEAR RESULTS • NOVOZYMES OVERVIEW • STRATEGY • SEGMENTAL OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW Biomass Conversion; Food, Feed, Fuel, Chemicals and Materials Made from Biomass and Waste • A transformational opportunity for Novozymes • Turning renewable low-value carbon into high-value pro
Slide 38: Agriculture & Feed Overview
FULL YEAR RESULTS • NOVOZYMES OVERVIEW • STRATEGY • SEGMENTAL OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW Agriculture & Feed Overview Agriculture & Feed (14% of 2013 sales) Agriculture & Feed Sales Sales DKK LCY growth 2,0 00 88% FEED: Monogastric animals / Substituting 1,7 50 1,668 78% phosphate /
Slide 39: The BioAg Alliance with Monsanto
FULL YEAR RESULTS • NOVOZYMES OVERVIEW • STRATEGY • SEGMENTAL OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW The BioAg Alliance with Monsanto - Aiming to Build Next Important Yield Platform for Farmers INTEGRATED SYSTEM EMERGING TRENDS • Multiple components converging to • Replacing agricultural input
Slide 40: Combined Leadership: Novozymes and Monsanto Microbials Platform
Combined Leadership: FULL YEAR RESULTS • NOVOZYMES OVERVIEW • STRATEGY • SEGMENTAL OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW Combination of Novozymes and Monsanto Establishes Industry's Most Advanced Microbials Platform ESTABLISHED MICROBIAL LEADERSHIP • World leader in microbial technology; disc
Slide 41: Power of Microbial Technology
FULL YEAR RESULTS • NOVOZYMES OVERVIEW • STRATEGY • SEGMENTAL OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW Power of Microbial Technology: Novozymes’ Proven Microbials portfolio CURRENT PRODUCT PORTFOLIO CASE: JUMPSTART ® 1. Microorganism Microorganism applied applied toto the theseed seed before bef
Slide 42: Ag Biologicals Market
FULL YEAR RESULTS • NOVOZYMES OVERVIEW • STRATEGY • SEGMENTAL OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW Ag Biologicals Market: Novozymes Has Developed a Significant Business in Fast Growth Market AG BIOLOGICALS MARKET1 NOVOZYMES BIOAG’s SALES DEVELOPMENT2 Market Segmented by Product Class 200
Slide 43: Attractive Value Proposition in Animal Feed
FULL YEAR RESULTS • NOVOZYMES OVERVIEW • STRATEGY • SEGMENTAL OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW Attractive Value Proposition in Animal Feed Phytase – phosphate • Only 3-30%* of phosphate in feed is available to the animal • Ronozyme NP® releases half of the phosphate bound – Ronozyme HiPh
Slide 44: Technical & Pharma Overview
FULL YEAR RESULTS • NOVOZYMES OVERVIEW • STRATEGY • SEGMENTAL OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW Technical & Pharma Overview Technical & Pharma (14% of 2013 sales) Feed & Other Tech. Enzymes Sales Sales DKK LCY growth 1,0 00 45% TECH: Textiles / Leather / Pulp & Paper Application PHARMA: A
Slide 45: Biopharma Overview
FULL YEAR RESULTS • NOVOZYMES OVERVIEW • STRATEGY • SEGMENTAL OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW Biopharma Overview The classic pharma value chain Drug Drug Sales and Manufacturing Distribution Discovery Development Marketing Novozymes Hyaluronic Acid: Albumin: • Applications for medical d
Slide 46: New cGMP Hyaluronic Acid Facility Is Commercial
FULL YEAR RESULTS • NOVOZYMES OVERVIEW • STRATEGY • SEGMENTAL OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW New cGMP Hyaluronic Acid Facility Is Commercial - Setting a New Product Standard Bacillus Subtilis fermentation • No animal-derived raw materials Safety • No organic solvents (aqueous recovery)
Slide 47: Sustainability
FULL YEAR RESULTS • NOVOZYMES OVERVIEW • STRATEGY • SEGMENTAL OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW INVESTOR PRESENTATION SUSTAINABILITY QUARTERLY RESULTS • OVERVIEW • STRATEGY • SEGMENTAL OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW
Slide 48: Recognized as a Sustainability-Driven Organization
FULL YEAR RESULTS • NOVOZYMES OVERVIEW • STRATEGY • SEGMENTAL OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW Recognized as a Sustainability-Driven Organization Novozymes in the Dow Jones Sustainability Indexes (DJSI): Best in Class Storebrand SRI • Included in DJSI Biotechnology sector since 2000, and
Slide 49: Three-pronged Core of Novozymes' Sustainability
FULL YEAR RESULTS • NOVOZYMES OVERVIEW • STRATEGY • SEGMENTAL OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW Three-pronged Core of Novozymes’ Sustainability Economic growth Use of natural resources It’s all in the numbers Scientific - All products are life-cycle assessed (LCA) Bioinnovation approach -
Slide 50: Reducing CO2 Emissions Together with our Customers
FULL YEAR RESULTS • NOVOZYMES OVERVIEW • STRATEGY • SEGMENTAL OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW Reducing CO2 Emissions Together with our Customers • In 2013, Novozymes helped customers save 52 million tons of CO2 through the application of Novozymes’ products, equivalent to taking 20 mill
Slide 51: Sustainability Performance and Targets
FULL YEAR RESULTS • NOVOZYMES OVERVIEW • STRATEGY • SEGMENTAL OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW Sustainability Performance and Targets - Good progress om 2013, but not all targets met 2013 2013 2014 Targets targets realized target Long-term sustainability targets Water efficiency (index 2
Slide 52: Financial Review
FULL YEAR RESULTS • NOVOZYMES OVERVIEW • STRATEGY • SEGMENTAL OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW INVESTOR PRESENTATION FINANCIAL REVIEW QUARTERLY RESULTS • OVERVIEW • STRATEGY • SEGMENTAL OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW
Slide 53: Historical Performance Demonstrates Track Record of Delivery
FULL YEAR RESULTS • NOVOZYMES OVERVIEW • STRATEGY • SEGMENTAL OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW Historical Performance Demonstrates Track Record of Delivery 2000-2013 sales CAGR of ~7% 58% Gross margin 57.2% 20% 15,000 56.2% Sales DKKm Growth 55.6% 16% 12,000 56% 57.2% 12% 9,000 53.3% 53.
Slide 54: Low Exposure to Raw Material Fluctuations
FULL YEAR RESULTS • NOVOZYMES OVERVIEW • STRATEGY • SEGMENTAL OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW Low Exposure to Raw Material Fluctuations Split of COGS • Factors impacting COGS development: • Productivity improvements, input prices, currency 35% • Note: accounting practice implies that 45
Slide 55: Dividend and Stock Buyback History
FULL YEAR RESULTS • NOVOZYMES OVERVIEW • STRATEGY • SEGMENTAL OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW Dividend and Stock Buyback History • Proposed 2013 dividend per share DKK 2.50, up 13%, DKK million Dividend / Buybacks Dividend per payout ratio 35.7% share, DKK Dividend Buyback DPS • Expecte
Slide 56: Shareholder Distribution
FULL YEAR RESULTS • NOVOZYMES OVERVIEW • STRATEGY • SEGMENTAL OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW Shareholder Distribution B shares listed in Copenhagen Shareholder distribution of under the symbol “NZYM B” B common stock* • Two share classes; A and B shares Rest of • B shares listed in Cop
Slide 57: Investor Relations Contacts
FULL YEAR RESULTS • NOVOZYMES OVERVIEW • STRATEGY • SEGMENTAL OVERVIEW • SUSTAINABILITY • FINANCIAL REVIEW Investor Relations Contacts Thomas Steenbech Bomhoff Martin Riise Klaus Sindahl Mobile (DK):+45 3077 1226 Mobile (USA): +1 919 649 2565 Mobile (DK): +45 5363 0134 E-mail: tsbm@novozymes.com Mob
Slide 58: Novozymes – Rethink Tomorrow
novozymes’ Rethink Tomorrow