Syensqo SA/NV · EURONEXT:SYENS
Syensqo SA/NV — FY2023 Earnings Presentation
35 slides from Syensqo SA/NV's earnings presentation, Mar 12, 2024
Slide 1: Full Year 2023 Results
Dr. ILHAM KADRI Full Year Chief Executive Officer 2023 Results CHRISTOPHER DAVIS Chief Financial Officer March 12, 2024
Slide 2: Disclaimer
Disclaimer This presentation may contain forward-looking information. Forward-looking statements describe expectations, plans, strategies, goals, future events or intentions. The achievement of forward-looking statements contained in this presentation is subject to risks and uncertainties relating t
Slide 3: Agenda
Agenda 2023 2023 Review Financial Review Looking 2024 Ahead Outlook 3
Slide 4: Dr. Ilham Kadri, Chief Executive Officer
Dr. ILHAM KADRI Chief Executive Officer
Slide 5: 2023 highlights: separation, growth strategy, financial results
Successfully completed separation; launched 6.8bn 1.6bn ■ new brand, vision and growth strategy € € ■ Top quartile performance over the last 2 years -11% volumes 23.7% margin ■ Further net pricing benefits with >€850m generated +1% pricing +10 bps YoY over last three years ■ Vitality index of 20.7%
Slide 6: Successfully completed our separation
Dec. 11th 2023 Successfully completed our separation in December 2023 JUNE 2023 JULY-OCTOBER 2023 NOVEMBER 2023 DECEMBER 2023 Targeted capital structure Debt management process New leadership team & Board Extraordinary General announcement of Directors (60% women) Meeting with 99.53% approval Tax ru
Slide 7: Bringing home the Full Year 2023 Results
Bringing home the 7 Full Year 2023 Results
Slide 8: Leadership positions in diversified growth markets
Leadership positions in diversified growth markets TOP 3 [1] Market position % of 2023 net sales 2023 vs 2022 Comments net sales growth Materials Automotive 16% Destocking from battery customers, Battery PVDF revenues of €0.2bn in 2023 Consumers & Resources Aerospace 15% Strong demand & pricing; ong
Slide 9: Focus on quality of market share
■ Focus on quality of market share ■ Lower volumes, esp. in Novecare & Aroma ■ Customer destocking in Agro, Building, Food ■ Sequential stability in Q4’23 with improving ■ Positive net pricing outlook ■ EBITDA margin expansion to 32.8% ■ Strong YoY growth in Composite Materials; Aero and defence up
Slide 10: One Planet roadmap
One Planet roadmap 50% of carbon reduction targets already achieved CLIMATE GROWTH BETTER LIFE Carbon Neutrality by 2040 Safety Gender 40% reduction 23% reduction 18% of Circular sales Aim for parity Scope 1 & 2 Scope 3 Focus 5[1,2] emissions by 2030[3] zero RIIR[4] by 2033[5] by 2030[1] by 2030 20%
Slide 11: Christopher Davis, Chief Financial Officer
CHRISTOPHER DAVIS Chief Financial Officer
Slide 12: Top quartile performance over the last two years
Top quartile performance over the last two years Sales growth EBITDA growth ROCE improvement (rebased to 100 in 2021) (rebased to 100 in 2021) (rebased to 100 in 2021) Peers avg. 104 Peers avg. 96 Peers avg. 91 [1] Peers group comprises: Akzo Nobel, Ashland, Avient, Celanese, Clariant, Croda, EMS Ch
Slide 13: Summary of H2 and FY 2023 Financial Results
Summary of H2 and FY 2023 Financial Results H2 H2 % % FY FY % % Underlying (€ million) 2023 2022 YoY organic 2023 2022 YoY organic Net sales 3,206 4,042 -21% -16% 6,834 7,890 -13% -10% EBITDA 712 937 -24% -19% 1,618 1,863 -13% -10% -100 EBITDA margin 22.2% 23.2% 23.7% 23.6% +10 bps bps Profit / (los
Slide 14: EBITDA in-line with outlook; lower volumes partially offset by net pricing
EBITDA in-line with outlook; lower volumes partially offset by further improvement in net pricing € million 2022 Scope Forex 2022 Volume Net Fixed Other 2023 conversion rebased & mix pricing costs 14
Slide 15: Acceleration in investments to drive growth
Acceleration in investments to drive growth € million Corporate Strong cash generation in 2023 allowed for Consumer & Resources Growth capex[1] acceleration in growth capital to support Materials Sustenance capex[2] future value creation 848 848 ● Battery materials: PVDF expansion in Tavaux, France
Slide 16: Strong operating cash flow enabled increased investment in growth capital
Strong operating cash flow enabled increased investment in growth capital € million % Cash flow from operating activities Cash conversion [1] Cash generated (%) after expenditure on growth capital [2] 2021 2022 2023 2021 2022 2023 [1] Cash conversion = (EBITDA +/- change in WC - Sustenance Capex)/EB
Slide 17: Strong Financial Position
Strong Financial Position Strong investment grade rating End of 2023 GEARING[1] S&P Stable outlook €1.6 bn 18% BBB+ Net Debt undrawn committed € 2.8 bn facilities Total cash & undrawn committed NET DEBT MOODY’S leverage ratio[2] 1 6 bn facilities Stable outlook € . €1.2 bn Cash 1.0X Baa1 [1] Gearing
Slide 18: Dr. Ilham Kadri, Chief Executive Officer
DR. ILHAM KADRI Chief Executive Officer
Slide 19: Fully focused on profitable growth & improving returns
Fully focused on profitable growth & improving returns Opportunity → Capital Allocation prioritising innovation & growth investments accelerated LIBERATED & execution → Accelerate time-to-market, more customer obsessed TO FOCUS intensified → Allows concentrated pursuit of new €10bn market opportunit
Slide 20: We create breakthroughs that advance humanity
We create breakthroughs that advance humanity Grow ~2x Be THE Create market prime Shareholder innovation Value partner Deliver superior returns “Our innovative solutions enhance the way we live, work, travel and play, contributing to a safer, cleaner and more sustainable world” 20
Slide 21: Starting the execution of our strategy
Starting the execution of our strategy Innovation Leadership Capital Discipline ■ Review and ■ Rephasing capex to Growth Engine priorioritize research Sustainable Solutions adapt to current and & innovation future demand investments ■ Footprint adaptation ■ Established growth ■ Leverage our new ■ Pu
Slide 22: Dr. Ilham Kadri, Chief Executive Officer
Dr. ILHAM KADRI Chief Executive Officer
Slide 23: FY 2024 outlook: high level drivers
FY 2024 outlook: high level drivers END MARKET OUTLOOK SYENSQO OUTLOOK SYENSQO COST DRIVERS ■ Strong growth in Aerospace CONSUMER MATERIALS ■ Dissynergies related to separation & Defense & RESOURCES ■ Focused investments in R&I to support ■ Auto: ~flat overall volumes with Strong growth Volume recov
Slide 24: FY 2024 EBITDA and Free Cash Flow outlook
FY 2024 EBITDA and Free Cash Flow outlook YoY EBITDA DRIVERS ● Similar demand dynamics to Q4 2023, with flattish overall volumes EBITDA[3] € 1.4 - 1.55 ● €50-100 million net pricing reduction ● Dissynergies (~€30 million) in 2024 related to separation billion ● R&I and IT investments, cost saving in
Slide 25: Supplementary Information
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Slide 26: Supplementary Information
Slide 27: Segment performance: Materials
Segment performance: Materials FY 2023 HIGHLIGHTS ■ Specialty Polymers: lower sales in automotive and construction, partially offset by higher sales in electronics Pricing offset volume declines; Strong growth in Aero & Defence ■ Strong year-on-year growth in Composite Materials driven by higher dem
Slide 28: Segment performance: Consumer & Resources
Segment performance: Consumer & Resources FY 2023 HIGHLIGHTS ■ Novecare: lower volumes and customer destocking, esp. Sharply lower YoY volumes in 2023; demand stabilisation in Q4 In Agro ■ Technology Solutions: lower H2 demand & disruptions in FY 2023 (€m) FY 2022 (€m) YoY change (%) YoY change (org
Slide 29: Quarterly summary of selected key figures
Quarterly summary of selected key figures Underlying (€ million) Q1 2023 Q1 2022 % YoY Q2 2023 Q2 2022 % YoY Net sales 1,813 1,772 +2% 1,815 2,076 -13% EBITDA 473 401 +18% 433 526 -18% EBITDA margin 26.1% 22.6% +350 bps 23.8% 25.3% -150 bps Capex (Total) 144 104 +38% 161 114 +41% Underlying, in € mi
Slide 30: Full-year 2023 key figures
Full-year 2023 key figures Full-year 2023 key figures IFRS Underlying (in € million) FY 2023 FY 2022 % yoy FY 2023 FY 2022 % yoy Net sales 6,834 7,890 -13.4% 6,834 7,890 -13.4% EBITDA 1,286 1,720 -25.3% 1,618 1,863 -13.1% EBITDA margin 23.7% 23.6% +10 bps EBIT 547 1,098 -50.2% 1,134 1,381 -17.9% Net
Slide 31: Free Cash Flow bridge
Free Cash Flow bridge € million 2023 Capex Working Provisions Financing Taxes & 2023 Underlying Capital Other Free Cash EBITDA Flow 31
Slide 32: Provisions evolution
Provisions evolution Voluntary Changes YoY Net new Unwinding Asset FY 2022 Payments pension Remeasurements in scope FY 2023 € million provisions of provisions contributions return & other change Employee benefits -338 39 -33 -102 86 56 -56 -26 -373 -35 Environment -270 32 -267 -10 - - 11 2 -500 -230
Slide 33: Major financial debt
Major financial debt Syensqo Syensqo Syensqo targ. cap. struct. Syensqo Targeted capital structure End End of of December Dec. 2023 € billion End of June 2023 End of June 2023 2023 EUR Senior Notes 1.1 Liabilities management 0.5 €500m Dec 27 2.75% 0.5 Consent on Sept 5, 2023 (transfer from Solvay SA
Slide 34: 2023 regional performance
2023 regional performance EUROPE 25% 25 % of net sales +X% AMERICAS ofYoY net sales ASIA & +2.1 pp YoY Rest of the World 41 % 35% of net sales -0.1 pp YoY of net sales -2.0 pp YoY 34
Slide 35: Investor Relations
INVESTOR RELATIONS Sherief Bakr sherief.bakr@syensqo.com +44 7920 575 989 Bisser Alexandrov bisser.alexandrov@syensqo.com +33 607 635 280 Imtiyaz Lokhandwala imtiyaz.lokhandwala@syensqo.com +1 609 860 3959 investor.relations@syensqo.com