Arkema Sa · EURONEXT:AKE
Arkema Sa — Autumn Conference Kepler Cheuvreux 2013
28 slides from Arkema Sa's conference presentation, Sep 18, 2013
Slide 1: Arkema roadshow presentation
Arkema roadshow presentation Autumn Conference Keplercheuvreux, Paris, 18 septembre 2013 Thierry LEMONNIER, CFO September, 2013
Slide 2: High value portfolio, strong base for future growth
High value portfolio Strong base for future growth
Slide 3: Arkema 2012 profile
Arkema 2012 profile Sales by segment Sales of €6.4 bn High Coating 33% 34% Solutions Performance EBITDA of €996 m Materials 33% Industry-leading margin at 15.6% Industrial Specialties 13,925 employees in 40 countries Sales by region Capex of €438 m R&D at 2.3% of sales Europe 40% 34% North America S
Slide 4: Industry leading margins supported by leadership positions in ~90% of sales
Industry leading margins supported by leadership positions in ~90% of sales EBITDA margin (%) High Performance Materials ● #1 in specialty polyamides 16.7% ● #1 in PVDF fluoropolymer 15.6% 15.9% ● #2 in organic peroxides 15.6% 14.7% 14.5% Industrial Specialties ● #1 in thiochemicals ● #1/2 in fluoro
Slide 5: Sales breakdown by business
Sales breakdown by business Organic Peroxides Acrylic monomers Coating High Filtration 9% 13% Solutions Performance and adsorption Materials 6% 34% 33% Coating Resins 13% Technical Polymers 2012 sales 18% Sartomer (UV curing resins) €6.4bn 5% Coatex (rheological additives) Hydrogen Peroxide 3% 4% Th
Slide 6: Diversified end markets
Diversified end markets Others 8% 22% Consumer goods Health, hygiene and beauty, Wellness, Sports and leisure, Packaging, Textile, etc. 16% Chemicals, plastics Water 3% Electronics 3% 13% Nutrition 4% Industrial coatings 6% Construction 12% 6% Decorative paints Energy 7% 6% in North America 5% in Eu
Slide 7: Balanced geographical reach
Balanced geographical reach RoW 5% 7% 12% Asia 21% 18% 23% North America 34% 17% 38% Europe 40% 48% 37% Arkema European panel* American panel** 7 * Akzo Nobel, BASF, Clariant, Lanxess, Solvay ** Dow, Celanese, Chemtura
Slide 8: Solid balance sheet and financing
Solid balance sheet and financing Shareholders’ equity € 2.3 bn Rating Net debt € 900 m Standards & Poor’s BBB Stable outlook Gearing 39 % Moody’s Baa2 Stable outlook Net debt / EBITDA 0.9x Figures at 31st December 2012 €1.9bn financing resources (€m) Average maturity > 4 years (€m) 700 500 480 Cred
Slide 9: Clear roadmap to 2016
Clear roadmap to 2016 « Become a world leader in specialty chemicals and advanced materials » Deliver profitable growth and solid cash flow Accelerate development of High Performance Materials Intensify our presence in high growth countries (China, India, Brazil, Middle East) Increase downstream int
Slide 10: 2016 financial targets
2016 financial targets € 8 bn 16 % Sales EBITDA margin EBITDA (€m) 1,280 996 + 140 + 144 Acquisitions and < 40 % Organic growth divestments Gearing 2012 2016e 10
Slide 11: 2016 targets by segment
2016 targets by segment High Performance Materials 38% of total sales 18% EBITDA margin Industrial Specialties 30% of total sales 17% EBITDA margin Coating Solutions 32% of total sales 15% EBITDA margin 11
Slide 12: Development in high growth countries
Development in high growth countries Sales by region (€bn) North America Europe € 8 bn Asia and RoW 2.5 2.8 € 6.4 bn 2.8 2.4 30% 2.2 1.7 Asia and RoW 26% North America 35% 34% 2012 2016e 2012 2016e 2012 2016e Europe 40% 35% 2012 2016e 12
Slide 13: Industrial projects to support organic growth
Industrial projects to support organic growth 2012 2013 2014 ● 2EHA (Acrylic derivates) ● Acrylic acid and esters ● Thiochemical platform (United States) (United States) (Malaysia) ● Superabsorbents* ● PVDF expansion (Acrylic derivates) ● Several other projects (China) (France) under consideration ●
Slide 14: Contribution of organic growth projects to EBITDA
Contribution of organic growth projects to EBITDA 2EHA Acrylic US AA expansion MA PVDF expansion (+50% - China) HFC125 expansion (+30% - China) Hipro expansion (x3 - China) Coating resins (new - China) Thiochemicals (new platform - Malaysia) 2012 2013 2014 2015 2016 Cumulated contribution to EBITDA
Slide 15: A rich pipeline of R&D projects
A rich pipeline of R&D projects Today Short-medium term Longer term PVDF for Electrolytes for Li-sulfur batteries Li-ion batteries Li-ion batteries (Oxis) New energies PVDF film for solar LGWP Thin layer pannel Fluorogases photovoltaic Metathesis process Renewable PMMA RNew® PA11/ PA10 Acrylic acid
Slide 16: Acquisition strategy
Acquisition strategy 2016 targets: + €140m EBITDA from acquisitions and divestments Small to mid-size bolt-on acquisitions Proven track record in acquiring businesses and executing integration ● €1.2bn cash out on acquisitions since spin off ● + €220m full year EBITDA net impact of acquisitions and
Slide 17: Cash allocation over 2013 - 2016
Cash allocation over 2013 - 2016 €3.6 bn cash resources available Cumulative Capex cash flow Borrowing capacity €1.7 bn from operating activities M&A, dividends and others €1.9 bn M&A M&A Dividends Dividends Others 17
Slide 18: Main objectives 2020
Main objectives 2020 EBITDA and EBITDA margin (%) Sales (€bn) Close to 16% 17% ~15% 10 8 6.5 6% 5.7 2005 2012e 2016e 2020e 2005 2012e 2016e 2020e Gearing < 40% 18
Slide 19: Key drivers of long term evolution
Key drivers of long term evolution Sales by segment Sales by region Coating Solutions North High Europe America Performance Materials Industrial Specialties Asia and RoW Continue to drive High Performance Materials Balanced geographical reach between growth with innovation Europe, North America and
Slide 20: Dividend increase reflects strong confidence in Arkema's potential
Dividend increase reflects strong confidence in Arkema’s potential Dividend (€/share) 1.80 1.3 Payout: 25% of adjusted net income 1.0 2.3% dividend yield 0.75 (based on share price at year end) 0.6 0.6 Arkema confirms its target to reach a 30% payout ratio on adjusted net income 2007 2008 2009 2010
Slide 21: 2nd quarter 2013 financial results and main facts
2nd quarter 2013 financial results and main facts
Slide 22: 2Q'13 highlights
2Q’13 highlights Sales (€m) EBITDA (€m) and EBITDA margin (%) 1,719 1,629 17.8% 16.8% -1.7% sales at constant Solid level versus high comparison scope of business and FX base of 2Q’12 306 273 Volumes +3.5% YoY Strong EBITDA margin at 16.8% Significant improvement vs 1Q’13 (+17%) 2Q’12 2Q’13 2Q’12 2Q
Slide 23: Key drivers of Arkema 2Q'13 performance
Key drivers of Arkema 2Q’13 performance Market conditions overall stable versus 1Q’13 but less favorable than in 2Q’12 ● North America remained solid with gradual improvement in housing market ● Challenging market conditions in Europe but stable versus 1Q’13 ● More moderate growth in Asia ● Coating
Slide 24: Sales bridge
Sales bridge Price / Sales (€m) Volume product mix Scope of FX rate – +3.5% business (5.2)% translation effect 1,719 (2.3)% (1.2)% 1,629 ● Volume up YoY ● Lower raw ● Tin stabilizer ● Not including mainly in materials divestment transaction effect Coating of US$ and ¥ Solutions ● Different product m
Slide 25: 2Q'13 key figures
2Q’13 key figures In €m (except EPS) 2Q’12 2Q’13 variation Sales 1,719 1,629 -5.2% EBITDA 306 273 -10.8% EBITDA margin 17.8% 16.8% Recurring operating income 229 195 -14.8% Adjusted net income* 151 124 -17.9% Non recurring items (25) (13) - Net income (group share) (12) 112 - Adjusted EPS* (diluted)
Slide 26: 1H'13 main figures
1H’13 main figures Sales (€m) EBITDA (€m) and EBITDA margin (%) 3,342 3,192 16.7% 15.9% 559 507 1H’12 1H’13 1H’12 1H’13 EBITDA (€m) and EBITDA margin (%) by segment 19.1% 17.6% 20.2% 20.2% 13.9% 13.8% 211 222 218 163 156 161 1H’12 1H’13 1H’12 1H’13 1H’12 1H’13 High Performance Materials Industrial S
Slide 27: Outlook
Outlook Market conditions expected to be in the continuity of the 1st half of the year with marked contrast by regions and a limited visibility ● Solid market conditions in North America ● Challenging but stable economic environment in Europe ● Slower growth than expected in China ● High Performance
Slide 28: Disclaimer
Disclaimer The information disclosed in this document may contain forward-looking statements with respect to the financial condition, results of operations, business and strategy of Arkema. Such statements are based on management’s current views and assumptions that could ultimately prove inaccurate