Slide 1: Record Results in 2015 - Strategic Targets Raised - Strong Start to 2016
RECORD RESULTS IN 2015 - STRATEGIC TARGETS RAISED – STRONG START TO 2016 SIKA INVESTOR PRESENTATION MAY 2016
Slide 2: Table of Contents
TABLE OF CONTENTS 1. FIRST QUARTER SALES 2016 AND OUTLOOK 2. HIGHLIGHTS AND STRATEGY EXECUTION 2015 3. RESULTS 2015 4. SUCCESSFUL EXECUTION OF AFRICA STRATEGY 5. SUCCESSFUL BUILD-UP OF THE NORTH AMERICAN MARKET 6. STRATEGY REVIEW AND RAISED TARGETS 7. SAINT-GOBAIN’S HOSTILE TAKEOVER ATTEMPT 2
Slide 3: 1. First Quarter Sales 2016 and Outlook
1. FIRST QUARTER SALES 2016 AND OUTLOOK
Slide 4: First Quarter Sales 2016: Strong Start with 8.3% Sales Growth
FIRST QUARTER SALES 2016 STRONG START TO THE YEAR WITH 8.3% SALES GROWTH 12% Sales growth by quarter 2015/2016 (in local currency) 10% + 8.3% + 8.3% 8% 2.5% 2.9% + 6.0% 6% + 5.1% + 5.3% 1.1% 2.6% acquisition 4% 2.2% 5.8% 5.4% organic 2% 4.0% 3.4% 3.1% 0% Q1 2015 Q2 2015 Q3 2015 Q4 2015 Q1 2016 4
Slide 5: First Quarter Sales and Outlook 2016
FIRST QUARTER SALES AND OUTLOOK 2016 STRONG START TO THE YEAR WITH 8.3% SALES GROWTH +8.3% sales growth in local currency to CHF 1,274.4 million All regions with growth; double-digit sales increase in Colombia, Argentina, North America, Southeast Asia, Pacific, Africa, Middle East and our indust
Slide 6: 2. Highlights and Strategy Execution 2015
2. HIGHLIGHTS AND STRATEGY EXECUTION 2015
Slide 7: Sika Is Active in Attractive Markets
SIKA IS ACTIVE IN ATTRACTIVE MARKETS WITH CORE COMPETENCIES IN BONDING, SEALING, DAMPING, REINFORCING AND PROTECTING Concrete Waterproofing Roofing Flooring & Coating Sealing & Bonding Refurbishment Industry 7
Slide 8: Highlights 2015
HIGHLIGHTS 2015 1. Continued growth +6.2% sales growth in local currencies to CHF 5,489.2 million +2.3% employees to 17,281 2. Key investments 3 new national subsidiaries 9 new factories 5 acquisitions 3. Record results CHF 673.3 million EBIT (+6.3%) CHF 465.1 million net profit (+5.4%
Slide 9: Key Figures: Record Results
KEY FIGURES RECORD RESULTS In million CHF 2014 2015 Δ% Net sales 5,571.3 5,489.2 - 1.5% Gross results as % of net sales 53.0 54.1 EBITDA 798.3 837.3 + 4.9% EBIT 633.2 673.3 + 6.3% Net profit 441.2 465.1 + 5.4% Operating free cash flow 417.5 451.5 + 8.1% ROCE in % 23.3 24.3 9
Slide 10: 6.2% Sales Growth for 2015, Growth in All Regions
6.2% SALES GROWTH FOR 2015 SALES GROWTH IN ALL REGIONS +8.4% + 5.6% + 2.1% 746 839 North America + 9.5% 1,040 1,017 2,734 2,600 Asia/Pacific EMEA 639 600 Latin America 2014 2015 (in CHF mn, Growth of 7.9% in Emerging Markets Growth in LC) 10
Slide 11: Accelerated Build-up of Emerging Markets Investments 2015
ACCELERATED BUILD-UP OF EMERGING MARKETS INVESTMENTS 2015 Opening of Sika plants: 2nd plant in United Arab Emirates (Dubai, March 2015) 1st plant on Reunion Island (March 2015) 1st plant in Sri Lanka (Ekala, March 2015) 1st plant in Paraguay (Asunción, May 2015) 4th plant in Russia (Volgog
Slide 12: New National Subsidiaries in 2015
CONTINUING HIGH OPERATING SPEED NEW NATIONAL SUBSIDIARIES IN 2015 New subsidiaries: Myanmar (March 2015) Tanzania (September 2015) Ethiopia (September 2015) Sika Myanmar Sika Myanmar production facilities 12
Slide 13: Acquisitions in 2015
CONTINUING HIGH OPERATING SPEED ACQUISITIONS IN 2015 Company Country Target Market Duro-Moza Mozambique Refurbishment BMI USA Refurbishment, Flooring Axson Technologies Global Industry CTA Australia Refurbishment Addiment Italia Europe Concrete Axson Technologies BMI Duro-Moza 13
Slide 14: Mortar Is Sika's Fastest Growing Technology
MORTAR IS SIKA’S FASTEST GROWING TECHNOLOGY CORE ELEMENT OF STRATEGY 2018 12.9% sales growth in 2015 Generates more than 20% of sales in construction segment 85 production plants across the globe 22 new plants opened since 2012 9 out of 17 acquired companies since 2012 Generates high, ab
Slide 15: Innovation in Mortars: Two in One Tile Adhesive
INNOVATION IN MORTARS TWO IN ONE TILE ADHESIVE SikaCeram® -500 APPLICATION TIMES SLASHED FROM NINE Ceralastic FLEXIBLE, ONE-COMPONENT, DAYS TO TWO DUE TO FIBER-REINFORCED MORTAR ONE SINGLE APPLICATION WATERPROOFING AND ADHESIVE SYSTEM TWO IN ONE PRODUCT 30% SAVINGS IN APPLICATION COSTS AND 45% LESS
Slide 16: Innovation in Waterproofing: Tackling Challenging Projects
INNOVATION IN WATERPROOFING TACKLING CHALLENGING PROJECTS SikaProof® A FIRST TIME THE USED IN THE CREATION OF PRODUCT HAS BEEN THE STUNNING RABAT USED IN GRAND THEATRE IN NORTH AFRICA MOROCCO PARTS OF THE BUILDING’S FOUNDATION ARE PERMANENTLY BELOW WATER PLACING EXTREMELY HIGH REQUIREMENTS ON THE WA
Slide 17: Worldwide Recognition for Our Achievements
WORLDWIDE RECOGNITION FOR OUR ACHIEVEMENTS 17
Slide 18: Five-Year Overview - Net Sales and EBIT
FIVE-YEAR OVERVIEW - NET SALES AND EBIT CONTINUATION OF PROFITABLE GROWTH STRATEGY 18
Slide 19: 3. Results 2015
3. RESULTS 2015 ® BUILDING TRUST Bs
Slide 20: Financial Highlights 2015
FINANCIAL HIGHLIGHTS 2015 Strong sales and volume growth of 6.2% (-1.5% in CHF) in spite of weaknesses in main markets, all regions contributed Over proportional EBIT growth, reaching 12.3% of net sales, +CHF 40 million in absolute terms in spite of adverse FX environment Lower interest expens
Slide 21: Sales Growth by Quarter: Dynamic Growth Momentum
SALES GROWTH BY QUARTER DYNAMIC GROWTH MOMENTUM 28% Growth rates in local currencies 23.3% Acquisition 23% Organic 18% 9.2% 14.0% 13% 11.7% 7.4% 8.3% 8% 5.4% 5.3% 5.1% 6.0% 5.3% 14.1% 2.5% 1.4% 1.1% 2.6% 2.2% 3% 6.6% 6.3% 5.8% 3.9% 4.0% 3.4% 3.1% -2% Q1 14 Q2 14 Q3 14 Q4 14 Q1 15 Q2 15 Q3 15 Q4 15 N
Slide 22: Profit & Loss: Strong Improvement in Key Financials
PROFIT & LOSS STRONG IMPROVEMENT IN KEY FINANCIALS In million CHF 2014 NS 2015 NS Growth Net sales 5,571.3 100% 5,489.2 100% - 1.5% Gross results 2,951.3 53.0% 2,970.8 54.1% + 0.7% Personnel costs -1,093.7 -19.7% -1,106.5 -20.1% + 1.2% Other OPEX -1,059.3 -19.0% -1,027.0 - 18.7% - 3.0% Depreciation
Slide 23: Consolidated Balance Sheet: Debt-Free, Over 1 Billion in Cash
CONSOLIDATED BALANCE SHEET DEBT-FREE BALANCE SHEET – OVER 1 BILLION IN CASH In million CHF 31.12.2014 31.12.2015 Δ% Cash and cash equivalents 898.8 1,074.4 + 19.5 Other current assets 1,697.3 1,703.7 + 3.8 Current assets 2,596.1 2,778.1 + 7.0 Non-current assets 2,221.8 2,145.7 - 3.4 Total assets 4,8
Slide 24: Cash Flow Statement: Record Operating Free Cash Flow
CASH FLOW STATEMENT RECORD OPERATING FREE CASH FLOW In million CHF 2014 2015 Cash flow from operating activities 554.4 585.8 CapEx/sale of assets/acquisitions -204.6 -206.3 Free cash flow 349.8 379.5 Acquisitions/financial assets 67.7 72.0 Operating free cash flow 417.5 451.5 Free cash flow 349.8 37
Slide 25: 4. Successful Execution of Africa Strategy
4. SUCCESSFUL EXECUTION OF AFRICA STRATEGY
Slide 26: Africa's High Potential
AFRICA’S HIGH POTENTIAL THE WORLD'S SECOND-LARGEST CONTINENT World’s fastest growing continent, 54 countries Resources and raw material driving economic growth 15% of the global population Strong population growth exceeding Asia: 1.1 billion inhabitants, figure expected to double by 2050
Slide 27: Successful Implementation of Sika's Africa Strategy
SUCCESSFUL IMPLEMENTATION OF SIKA’S AFRICA STRATEGY ACCELERATED EXPANSION IN AFRICA Strategy developed in 2013 Macroeconomic aspects: GDP, political stability, demographic trends, infrastructure spend Microeconomic criteria: annual cement consumption and market potential for concrete, mortars,
Slide 28: Sika's Track Record in Africa
SIKA’S TRACK RECORD IN AFRICA STRONG EXECUTION +22% 9 Sales growth in 2015 New plants since 2012 16 subsidiaries 688 8 added since 2012 employees 28
Slide 29: Major Construction Projects with Sika Products
MAJOR CONSTRUCTION PROJECTS WITH SIKA PRODUCTS Bridge over Maputo Bay, Mozambique Dangote fertilizer plant Lagos, Nigeria 29
Slide 30: Major Construction Projects with Sika Products
MAJOR CONSTRUCTION PROJECTS WITH SIKA PRODUCTS Luanda International Airport, Angola Mall of Egypt, Cairo, Egypt 30
Slide 31: 5. Successful Build-up of the North American Market
5. SUCCESSFUL BUILD-UP OF THE NORTH AMERICAN MARKET
Slide 32: Focus on Fastest Developing Metro Areas
FOCUS ON FASTEST DEVELOPING METRO AREAS INVESTMENTS INTO SUPPLY CHAIN AND SALES FORCE Forbes list of the 20 fastest growing metro areas in the USA 1. Austin, TX 11. Seattle, WA 2. Raleigh, NC 12. Atlanta, GA No. 1 – Austin, Texas 3. Phoenix, AZ 13. Provo, UT 4. Dallas, TX 14. Cape Coral, FL 5. Salt
Slide 33: North American Supply Chain Strategy 2018: New Plant Openings 2014/2015
NORTH AMERICAN SUPPLY CHAIN STRATEGY 2018 SUCCESSFUL NEW PLANT OPENINGS IN 2014/2015 Denver, Colorado One of the fastest growing metropolitan areas New admixture plant Sales up by 25% Atlanta, Georgia One of the fastest growing metropolitan areas New mortar plant next to admixture plant
Slide 34: North American Supply Chain Strategy 2018: New Plant Opening in 2016
NORTH AMERICAN SUPPLY CHAIN STRATEGY 2018 SUCCESSFUL NEW PLANT OPENING IN 2016 Vancouver, Canada Seattle (US) / Vancouver (Canada) are part of a very fast developing area New mortar and concrete admixture plant Improved product availability, reduced lead times, faster deliveries as well as an
Slide 35: North American Supply Chain Strategy 2018: Acquisition in 2016
NORTH AMERICAN SUPPLY CHAIN STRATEGY 2018 ACQUISITION IN 2016 L.M. Scofield, USA US‐based market leader for concrete color additives (ready‐mixed concrete) and decorative treatments for refurbishment Buying new technology and spreading it out to Sika’s existing customer base Continued strong e
Slide 36: Accelerated Build Up of Presence in USA
ACCELERATED BUILD UP OF PRESENCE IN USA 20 plants in USA and Canada 9 new plants added between 2013-2016 Presence in residential Investment focus 12% market through Home Depot on fast growing sales growth (2,000 stores) and metro areas in Q1 2016 Lowes (1,800 stores) 36
Slide 37: Focus on Key Economic Areas: Selected Key Projects in the USA
FOCUS ON KEY ECONOMIC AREAS SELECTED KEY PROJECTS 2014/2015 IN THE USA Apple headquarter, California Tesla GigaFactory, Nevada East Side Access, New York State Farm Arena, Illinois M&G’s new PET plant, Texas Aldi Distribution Center, California 37 |
Slide 38: Hudson Yards Project NYC
HUDSON YARDS PROJECT NYC SIKA IS HELPING TO BUILD A NEW CITY IN A CITY 38
Slide 39: 6. Strategy Review and Raised Targets
6. STRATEGY REVIEW AND RAISED TARGETS
Slide 40: Strategy 2018 - Achievements Since 2012
STRATEGY 2018 – ACHIEVEMENTS SINCE 2012 A PROVEN TRACK RECORD OF DELIVERY PILLARS OF THE GROWTH MODEL ACHIEVEMENTS • Successful Target Market concept MARKET PENETRATION • Megatrends driving growth • 297 new patents filed INNOVATION • 20 Global Technology Centers • 30 new plants opened EMERGING M
Slide 41: Strategy 2018: Strategy Review and Raised Targets
STRATEGY 2018 STRATEGY REVIEW AND RAISED TARGETS Since the targets for Strategy 2018 have been reached ahead of schedule, with three full business years to go, the Board of Directors decided to raise them in January 2016, as a result of the strategy review carried out in 2015. Bottom-up review of
Slide 42: Strategy 2018: Previous Targets vs New and Raised Targets
STRATEGY 2018 STRATEGY REVIEW AND RAISED TARGETS PREVIOUS TARGETS NEW AND RAISED TARGETS FROM JANUARY 2016 6-8% growth per year 6-8% growth per year 42-45% of sales in 6-8 new plants per year emerging markets 100 national subsidiaries by 2018 >10% operating profit 12-14% operating profit per year >6
Slide 43: Sika's Growth Model with New and Raised Targets
STRATEGY 2018 SIKA’S GROWTH MODEL WITH NEW AND RAISED TARGETS MARKET PENETRATION 6 - 8% GROWTH PER YEAR 6 - 8 NEW PLANTS PER INNOVATION YEAR 100 NATIONAL SUBSIDIARIES BY 2018 EMERGING MARKETS 12 - 14% OPERATING PROFIT PER YEAR ACQUISITIONS > 8% OPERATING FREE CASH FLOW PER YEAR 25% RETURN ON CAPITAL
Slide 44: 7. Saint-Gobain's Hostile Takeover Attempt
7. SAINT-GOBAIN’S HOSTILE TAKEOVER ATTEMPT
Slide 45: Reasons for Opposing the Hostile Takeover Attempt by Saint-Gobain
REASONS FOR OPPOSING THE HOSTILE TAKEOVER ATTEMPT BY SAINT-GOBAIN 1. Complete control with just a 16% stake 2. Fatal prioritization of Saint-Gobain's interests and competitive distortion 3. Unrealistic synergies, high degree of attrition 4. Negative operating consequences for Sika • Focus switch fro
Slide 46: Sika Articles of Association Article 4: Restriction of Transferability
SIKA ARTICLES OF ASSOCIATION ARTICLE 4 RESTRICTION OF TRANSFERABILITY, THE 5% THRESHOLD “The Board of Directors reserves the right to refuse an acquirer of registered shares as shareholder, if the number of registered shares held by him exceeds 5% of the total number of registered shares entered in
Slide 47: Ensuring the Sika Success Story Continues
ENSURING THE SIKA SUCCESS STORY CONTINUES STRONG OPPOSITION TO HOSTILE TAKEOVER ATTEMPT Strong performance underscores the necessity of safeguarding Sika’s successful business model in the interest of all stakeholders Public shareholders, Board of Directors, Group Management, 160 Senior Managers
Slide 48: Forward-Looking Statements
FORWARD-LOOKING STATEMENTS This presentation contains certain forward-looking statements. These forward-looking statements may be identified by words such as ‘expects’, ‘believes’, ‘estimates’, ‘anticipates’, ‘projects’, ‘intends’, ‘should’, ‘seeks’, ‘future’ or similar expressions or by discussion
Slide 49: Thank You for Your Attention
THANK YOU FOR YOUR ATTENTION ® BUILDING TRUST Bs