Stora Enso Oyj Class A · OMXHEX:STEAV
Stora Enso Oyj Class A — Investor Day (November 2017)
22 slides from Stora Enso Oyj Class A's investor day presentation, Nov 8, 2017
Slide 1: Delivering sustainable profitable growth
Delivering sustainable profitable growth CFO, Seppo Parvi
Slide 2: Our road to success in the bioeconomy
Our road to success in the bioeconomy Introducing Addressing Delivering Generating xxxx xxxx attractive xxxx sustainable xxxx superior new products and services end-use profitable ROCE segments growth 2 8 November 2017 Stora Enso CMD
Slide 3: Our road to success: Sustainable profitable growth
Our road to success Sustainable profitable growth Customer insight Developing offerings according to customers’ requirements to create value and growth, with sales excellence. Innovation Structured Focus on bio-based processes materials and Sustainable Clear roles and chemicals, responsibilities, pr
Slide 4: Our road to success: Sustainable profitable growth
Our road to success Sustainable profitable growth Customer insight Strategic growth Developing offerings investments according to customers’ Capex at or below requirements to create depreciation and depletion* value and growth, with over the business cycle sales excellence. Innovation Structured Div
Slide 5: Improving performance across the group
Improving performance across the group Strategic investments coming through Accelerating growth Sustainable profitable growth Operational EBIT reaching new level 5 8 November 2017 Stora Enso CMD * Excluding paper and Barcelona Mill. LTM = Q4/16-Q3/17
Slide 6: Accelerating sustainable profitable growth
Accelerating sustainable profitable growth Consumer Board – transformation is delivering Target: Operational ROOC >20% Packaging Solutions – transformation is delivering Target: Operational ROOC >20% * Excluding Barcelona ** Excluding Corenso 6 8 November 2017 LTM = Q4/16-Q3/17 Stora Enso CMD
Slide 7: Improving performance
Improving performance Biomaterials – strong market conditions supporting transformation Target: Operational ROOC >15% Wood Products – transformation is delivering Target: Operational ROOC >20% 7 8 November 2017 LTM = Q4/16-Q3/17 Stora Enso CMD
Slide 8: Stable cash flow continues
Stable cash flow continues Paper Target: cash flow after Investing activities to sales > 7% 8 8 November 2017 LTM = Q4/16-Q3/17 Stora Enso CMD
Slide 9: Walking the talk
Walking the talk Wood Products operational ROOC target increased to 20% Group targets Q1/15 Q3/17 Dividend To distribute 50% of net income over the cycle Growth* To grow faster than the relevant market 3.0% (YoY) 11.3% (YoY) Net debt to operational EBITDA <3.0x 2.6 1.8 Fixed costs to sales <20% 24.2
Slide 10: Forest assets – Northern and Southern hemisphere
Forest assets – Northern and Southern hemisphere Fair value of 3.4 BEUR Bergvik Skog, Sweden Tornator, Finland 2.3 million ha of land in Sweden, 575 000 ha of land in Finland, 57 000 ha in 100 000 ha in Latvia (ownership of 49%) Estonia, and 12 000 ha in Romania (ownership 41%) Guangxi, Southern Chi
Slide 11: Forests are a strategic asset for the future
Forests are a strategic asset for the future 31 Dec 2016 Biological assets Stora Enso 3.4 BEUR SCA 3.2 BEUR Holmen 1.8 BEUR UPM 1.7 BEUR Klabin 1.1 BEUR Exchange rates, European central bank 31 Dec 2016 SEK/EUR 9.5525 BRL/EUR 3.4305 11 8 November 2017 Stora Enso CMD
Slide 12: Capex level supporting our transformation strategy
Capex level supporting our transformation strategy • Capex at or below depreciation and operational decrease in value of biological assets over the business cycle • Capex to biological assets approximately 100 MEUR • Maintenance capex approximately 200-250 MEUR • Strategy capex 250-300 MEUR − To con
Slide 13: Capex is moving towards targeted level
Capex is moving towards targeted level 989 781 729 600–650 550–600 Maintenance capex Strategic capex Biological capex Capex estimate for 2018 Depreciation and operational decrease in the value of biological assets 13 8 November 2017 Stora Enso CMD
Slide 14: Targeted ROOC is driving CAPEX allocation
Targeted ROOC is driving CAPEX allocation Capex forecast in 2018 *Operational ROOC target ** Cash flow after investing activities to sales target 14 8 November 2017 Stora Enso CMD
Slide 15: Strong cash flow continues…
Strong cash flow continues… Good cash flow from operations Net debt to Operational EBITDA strengthening 15 8 November 2017 LTM = Q4/16-Q3/17 Stora Enso CMD
Slide 16: …and we have good access to debt markets
…and we have good access to debt markets Maturity profile Q3/17 Stora Enso successfully issued a new 300 MEUR bond, under its Euro Medium Term Note (EMTN) programme on 31 May 2017 • 10 year bond • Pays a fixed coupon of 2.5% Improving credit ratings Long / Short-term Rating agency Valid from ratin
Slide 17: Enterprise value increased by 51% since 2012
Enterprise value increased by 51% since 2012 Enterprise value Distribution of the enterprise value * Market capitalisation as of 25 October 2017 17 8 November 2017 Stora Enso CMD
Slide 18: We are recalculating EBITDA to better reflect our cash generating ability
We are recalculating EBITDA to better reflect our cash generating ability • Equity accounted investments (EAI) results currently included in Operational EBIT, but excluded in Operational EBITDA • EAIs are mainly Bergvik Skog and Tornator • Market practise is to include forest holdings in their EBITD
Slide 19: This is how our operational EBITDA changes due to EAI calculation
This is how our operational EBITDA changes due to EAI calculation MEUR 2014 2015 2016 Q1-Q3/17 Current Operational 1 314 1 408 1 371 1 103 EBITDA Restated operational 1 412 1 501 1 463 1 160 EBITDA Difference 98 93 92 57 Management incentive plan for 2017 will be adjusted accordingly 19 8 November 2
Slide 20: Our road to success: Sustainable profitable growth
Our road to success Sustainable profitable growth Customer insight Strategic growth Developing offerings investments according to customers’ Capex at or below requirements to create depreciation and depletion* value and growth, with over the business cycle sales excellence. Innovation Structured Div
Slide 21: Disclaimer
Disclaimer It should be noted that Stora Enso and its business are exposed to various risks and uncertainties and certain statements herein which are not historical facts, including, without limitation those regarding expectations for market growth and developments; expectations for growth and profi
Slide 22: The Renewable Materials Company
THE RENEWABLE MATERIALS COMPANY