Heidelberg Materials Ag · XETR:HEI
Heidelberg Materials — HeidelbergCement — Davy Industrials Conference 2019
27 slides from Heidelberg Materials's conference presentation, Sep 5, 2019
Slide 1: Davy Industrials Conference
Davy Industrials Conference New York – 05 September 2019 Christoph Beumelburg – Group Director Communication & IR Ozan Kacar – Head of Investor Relations Slide 1 - Davy Industrials Conference New York – 05 September 2019
Slide 2: Table of contents
Table of contents HeidelbergCement in a nutshell HeidelbergCement in North America Four strategic pillars H1 2019 results Outlook Slide 2 - Davy Industrials Conference New York – 05 September 2019
Slide 3: HeidelbergCement with strong global market position
HeidelbergCement with strong global market position Aggregates Cement RMC (mt) (mt) (mm3) Globally #1 Globally #2 Globally #3 +1% 308.1 309.9 +1% 127.5 129.1 +6% 47.6 50.4 H1 2018 H1 2019 H1 2018 H1 2019 H1 2018 H1 2019 LTM LTM LTM LTM LTM LTM Slide 3 - Davy Industrials Conference New York – 05 Sept
Slide 4: We benefit from strong growth in developed markets
We benefit from strong growth in developed markets… Group turnover* Developed 78% 22% Emerging Top 10 North America 24% Northern Europe 8% Australia 7% France 7% UK 7% Germany 6% Indonesia 5% Benelux 4% Italy 3% India 3% … while having upside from recovery in the emerging world * Last twelve months
Slide 5: Continuous improvement in financial metrics
Continuous improvement in financial metrics Revenue EPS Net debt +25% -304 +5% +36% 8,999 -328 +1% 18,075 5.8 17,266 4.6 8,695 17,084 3.4 8,367 2016 2017 2018 2016 2017 2018 2016 2017 2018 DPS Return on capital invested WACC ROIC +11% 7.2% +19% 7.0% 6.9% 6.6% 1.9 2.1 6.3% 1.6 6.9% 23,595 26,029 25,5
Slide 6: Table of contents
Table of contents HeidelbergCement in a nutshell HeidelbergCement in North America Four strategic pillars H1 2019 results Outlook Slide 6 - Davy Industrials Conference New York – 05 September 2019
Slide 7: Well-balanced product portfolio and geographical footprint
Well-balanced product portfolio and geographical footprint Revenue by key Operating geography Operating EBITDA market* by segment* Other Pipe Prairies Northeast Cement Sunbelt 4% 10% 26% 10% 3% 40% 12% 53% 14% PNW 12% 2% 13% Midwest CA Aggregates RMC & ASP TX Well-positioned in all key Above-average
Slide 8: Solid asset base and product portfolio in North America
Solid asset base and product portfolio in North America Well • Major urban centers in U.S. & Canada positioned in • Broad coverage of 30 U.S. states & 6 Canadian Provinces all key markets • Fast growth areas – Sunbelt, Texas, West Coast Excellent • ~ 27.5 mt cement capacity*) product • ~12bt aggrega
Slide 9: Table of contents
Table of contents HeidelbergCement in a nutshell HeidelbergCement in North America Four strategic pillars H1 2019 results Outlook Slide 9 - Davy Industrials Conference New York – 05 September 2019
Slide 10: Four strategic pillars
Four strategic pillars 1. 2. 3. 4. Vertical Sustainable Operational Digital integration growth excellence transformation All core Follow UN’s Focus on KPIs, Digital plants, business lines Sustainable savings, customer in key urban Development technology, experience, big markets Goals innovation. dat
Slide 11: Vertically integrated business model in fast-growing urban centers
Vertically integrated business model in fast-growing urban centers Aggregates Cement Asphalt Ready-mixed concrete Infrastructure Commercial Housing Slide 11 - Davy Industrials Conference New York – 05 September 2019
Slide 12: The benefits of vertical integration
The benefits of vertical integration Boost captive • Be close to customers through ready-mix concrete operations and learn sales of about theirs needs. Develop innovative or tailor-made concrete solutions. cement and • Boosting RMC sales with a pull-through on captive supplies of cement and aggregat
Slide 13: We are the sustainability leader in the sector
We are the sustainability leader in the sector Our “Sustainability Commitments 2030” We are the first cement producer with a are aligned with CO2 reduction target verified by the “UN Sustainable Development Goals” Science Based Targets Initiative. Economic strength & innovation Compliance & Health &
Slide 14: Our vision 2050: Carbon-neutral concrete
Our vision 2050: Carbon-neutral concrete Reduce by 30% specific net CO2 emissions per ton of CEM* • Upgrade kiln lines to increase energy efficiency 2030 • Use more alternative fuels • Lower the clinker ratio in cement Produce CO2-neutral concrete • Develop technologies for CO2-capture and utilizati
Slide 15: Consistently improving operational efficiency
Consistently improving operational efficiency Revenue per employee (in € ´000)* Ongoing Hanson Optimization after Recovery after financial crisis optimization optimization ITC acquisition Hanson Financial Italcementi acquisition crisis acquisition 306 296 292 281 270 269 246 251 233 220 209 189 195
Slide 16: Clear efficiency improvement roadmap: Action Plan 2020
Clear efficiency improvement roadmap: Action Plan 2020 Cost Margin Cash Cash management improvement generation management SG&A program Aggressive Disposal Limit growth with a 100m€ commercial program with a CapEx with saving target excellence 1.5 b€ target total 700m€ (2019-2020) initiatives (2018-2
Slide 17: Disposals focused on three categories
Disposals focused on three categories Non-core Weak market Idle assets businesses positions • Business activities outside of • Countries with high risk. • Depleted quarries and land. core business lines: cement, • Market positions with limited • Unused fixed assets. aggregates, ready-mix growth pote
Slide 18: Digitalization: Improving processes & customer experience
Digitalization: Improving processes & customer experience Transformation of the existing business (DTO) Remotely Big data Digital Workflow controlled & analytics for exchange automation maintained concrete mix with production design & suppliers and units. workflow customers analysis Potential for en
Slide 19: Table of contents
Table of contents HeidelbergCement in a nutshell HeidelbergCement in North America Four strategic pillars H1 2019 results Outlook Slide 19 - Davy Industrials Conference New York – 05 September 2019
Slide 20: Overview of H1 2019
Overview of H1 2019 Solid result improvement in H1 LfL revenue increase +7%; EBITDA increase +6%; adjusted EPS increase 38%. Strong margin improvements in Asia and Europe more than compensate the weather driven pressure in North America and weak demand in Egypt and Turkey. SG&A saving program
Slide 21: H1 2019 operational EBITDA bridge
H1 2019 operational EBITDA bridge +5.7% 316 21 -288 151 10 1,446 20 1,286 1,195 26 -5 1,216 H118 Currency Decons. H118 LfL Price Net Costs Other H119 LfL IFRS 16 Scope H119 Reported EBITDA volume EBITDA Reported EBITDA EBITDA Solid organic EBITDA growth in H1 Previous year figures are adjusted due t
Slide 22: Revenue and EBITDA overview
Revenue and EBITDA overview H1 2019 vs. H1 2018 Q2 2019 vs. Q2 2018 Revenue growth 29.0% 18.2% EBITDA* growth 13.4% 18.0% 9.7% 13.6% 13.1% 3.1% 2.9% 2.3% 7.4% 1.8% 5.6% 3.6% 2.1% 0.5% -1.3% -3.8% -16.3% -17.3% North West/South North/East Asia/Pacific Africa/Med. North West/South North/East Asia/Paci
Slide 23: Table of contents
Table of contents HeidelbergCement in a nutshell HeidelbergCement in North America Four strategic pillars H1 2019 results Outlook Slide 23 - Davy Industrials Conference New York – 05 September 2019
Slide 24: 2019 outlook and targets
2019 outlook and targets Operations • Volume increase in all business lines Performance • Margin improvement Result • Solid revenue, EBITDA, EPS growth Portfolio • 500 m€ disposal; net growth CAPEX* below 0 Leverage • Net debt reduction to 7.7 billion EUR** * * Net growth CAPEX = Gross growth CAPEX
Slide 25: 2019: Solid results improvement in most regions
2019: Solid results improvement in most regions Europe North America Solid EBITDA growth as a result of very strong pricing and an easing Strong infrastructure cost base. demand to drive the volumes. Favorable pricing development. Asia Pacific Africa Clear improvement in Sub-Saharan to earnings in I
Slide 26: Contact information
Contact information Date Event Contact Information 7 November 2019 Q3 Results Mr. Christoph Beumelburg Director Communication & IR Phone: +49 (0) 6221 481 13249 christoph.beumelburg@heidelbergcement.com Mr. Ozan Kacar Head of IR Phone: +49 (0) 6221 481 13925 ozan.kacar@heidelbergcement.com Mr. Piotr
Slide 27: Disclaimer
Disclaimer Unless otherwise indicated, the financial information provided herein has been prepared under International Financial Reporting Standards (IFRS). This presentation contains forward-looking statements and information. Forward-looking statements and information are statements that are not h