Heidelberg Materials Ag · XETR:HEI
Heidelberg Materials — HeidelbergCement — Q3 2020 Earnings Presentation
23 slides from Heidelberg Materials's earnings presentation, Nov 5, 2020
Slide 1: Q3 2020 Trading Update
Q3 2020 Trading Update 5 November 2020 Dr. Dominik von Achten – Group CEO Dr. Lorenz Näger – Group CFO
Slide 2: Key Messages Q3 2020
Key Messages Q3 2020 ▪ Strong operational performance – LfL EBITDA increases by 17% with nearly flat revenue, leading to significant margin improvement. ▪ COPE cash savings plan clearly pays back – 721 million EUR cash savings achieved in the first 9 months. ▪ Excellent financial performance – LTM F
Slide 3: Significant margin improvement with nearly flat revenue
Q3 2020 OVERVIEW Significant margin improvement with nearly flat revenue Revenue (m€) Operating EBITDA (m€) Operating EBITDA Margin Operating EBIT (RCO) (m€) Lfl: +6% Lfl: +10% Lfl: -7% +5% +398 bps +8% -8% 14.273 +249 bps Lfl: +25% 13.140 Lfl: 17% 2.612 2.731 27.2% 1.583 1.715 23.2% +21% Lfl: -1% +
Slide 4: Demand coming back after a very difficult Q2
Q3 2020 OVERVIEW Demand coming back after a very difficult Q2 Volumes Q3 19 Q3 20 Change LfL North America Cement sales volume (mt) 33.5 33.8 0.2 0.7% ▪ EBITDA growth and margin improvement achieved despite Aggregates sales volume (mt) 87.7 86.1 -1.6 -0.9% continuing pressure on demand. Ready mix sa
Slide 5: Significant growth driven by positive pricing and cost savings
Q3 2020 OVERVIEW Significant growth driven by positive pricing and cost savings Q3 Operating EBITDA Bridge (m€) +16.5% 188 1,328 0 1,328 1,174 -34 1,140 0 Q3 2019 EBITDA Currency Q3 2019 Net volume Price over cost 1) Q3 2020 Scope Q3 2020 EBITDA LfL EBITDA LfL EBITDA 1) Includes COPE cost savings of
Slide 6: Strong Q3 drives good year to date performance
Q3 2020 OVERVIEW Strong Q3 drives good year to date performance 9M Operating EBITDA Bridge (m€) +6.1% 392 2,727 5 2,731 2,612 -41 2,570 -236 9M 2019 EBITDA Currency 9M 2019 Net volume Price over cost 1) 9M 2020 Scope 9M 2020 EBITDA LfL EBITDA LfL EBITDA 1) Includes COPE cost savings of 283m€ 6 Q3 20
Slide 7: COPE action plan on track despite much higher revenue than anticipated
Q3 2020 OVERVIEW COPE action plan on track despite much higher revenue than anticipated COPE cash savings as of September 2020 (m€) Proactive and successfully implimented action plan 1,000 ▪ Cope action plan already initiated in February ▪ Minimization of all non-essential expenses and reduction 126
Slide 8: Significant EBITDA margin improvement in all regions
Q3 2020 OVERVIEW Significant EBITDA margin improvement in all regions North America Western & Southern Europe North & Eastern Europe – Central Asia +277 bps +502 bps +222 bps 27.4% 30.2% 24.2% 28.9% 31.1% 19.2% Q3 2019 Q3 2020 Q3 2019 Q3 2020 Q3 2019 Q3 2020 Asia Pacific Africa-Eastern Mediterranean
Slide 9: Covid-19 impact clearly mitigated by COPE action plan and well-balanced portfolio
Q3 2020 OVERVIEW Covid-19 impact clearly mitigated by COPE action plan and well-balanced portfolio % Year to date LfL EBITDA growth in % (vs. prior year) Monthly LfL EBITDA growth in % (vs. prior year) Q1 +2.4% 9M +6.1% H1 -2.2% Jan Feb Mar Apr May Jun Jul Aug Sep 9 Q3 2020 Trading Update | 5 Novemb
Slide 10: Key Financial Messages September 2020
Key Financial Messages September 2020 ▪ 2.3 bn€ free cash flow over the last twelve months, up by 0.8 bn€ (cash conversion rate 63%) ▪ Strong cash generation shows ability of the company to manage costs & spending very flexibly and react quickly to external shocks ▪ Net debt reduced by 1.8 bn€ year
Slide 11: Strong free cashflow generation continues
FINANCIAL RESULT Strong free cashflow generation continues Free cash flow1) generation (m€) Cash conversion rate: 63% 3,700 322 -290 -338 2,315 -842 -237 +758 (49%) 1,557 Sep 2020 Interest Tax Change in CapEx Net Other FCF FCF Generation EBITDA payment payment working Generation 2019 Sep LTM capital
Slide 12: Significant net debt reduction driven by strong cash generation and disciplined CapEx
FINANCIAL RESULT Significant net debt reduction driven by strong cash generation and disciplined CapEx Net debt development (m€) -1,804 m€ 9,695 198 7,891 299 14 -2,315 Net debt FCF Net growth Dividends Currency / other Net debt Sep 2019 CapEx1) Sep 2020 1) Net growth capex incl. capital decrease in
Slide 13: Sustainability
SUSTAINABILITY ▪ Strong commitment to ESG HeidelbergCement maintains an AA rating (category of Leader) in the MSCI ESG Rating ▪ Continued progress in leveraging our sustainable/ low-carbon product portfolio i.tech® 3D: HeidelbergCement’s Innovative concrete for Germany’s first printed residential ho
Slide 14: HeidelbergCement with an AA MSCI ESG rating for the fifth time in a row
SUSTAINABILTY HeidelbergCement with an AA MSCI ESG rating for the fifth time in a row MSCI‘s ESG rating scorecard (as of September 21, 2020) ▪ In September 2020, HeidelbergCement achieved an AA rating in the MSCI ESG Rating for the fifth time in a row ▪ AA rating puts HeidelbergCement in the categor
Slide 15: i.tech 3D: Innovative concrete for Germany's first printed residential house
SUSTAINABILTY i.tech® 3D: Innovative concrete for Germany’s first printed residential house 3D-printed Beckum house, Germany Product description: Innovative concrete i.tech® 3D developed for 3D extrusion printing with rapid load-bearing capacity Project details: Construction of a 160m2 two-storey de
Slide 16: "Beyond 2020" Targets
“Beyond 2020” Targets EBITDA margin ROIC Leverage ratio Clearly +300 bps >8% 1.5-2.0x vs 2019 Sustainability Digital transformation CO2 reduction <525 kg target accelerated by 5 years: >75% of global sales volumes CO2/t cementitious -30% vs 1990 covered by HConnect
Slide 17: Key Messages Q3 2020
Key Messages Q3 2020 ▪ Strong operational performance – LfL EBITDA increases by 17% with nearly flat revenue, leading to significant margin improvement. ▪ COPE cash savings plan clearly pays back – 721 million EUR cash savings achieved in the first 9 months. ▪ Excellent financial performance – LTM F
Slide 18: Appendix
Appendix ’ HEIDELBERGCEMENT we
Slide 19: Sales volumes
APPENDIX Sales volumes Sales Volumes Cement (‘000 t) Aggregates (‘000 t) Ready Mix (‘000 m3) Asphalt (‘000 t) QUARTER Q3 19 Q3 20 Change LfL Q3 19 Q3 20 Change LfL Q3 19 Q3 20 Change LfL Q3 19 Q3 20 Change LfL North America 4,786 4,505 -281 -5.9% 40,421 38,596 -1,824 -4.5% 2,253 2,261 8 -0.1% 1,910
Slide 20: Operating result
APPENDIX Operating result Operating Result Revenues (m€) Operating EBITDA (m€) Operating EBIT / RCO (m€) EBITDA Margin QUARTER Q3 19 Q3 20 Change LfL Q3 19 Q3 20 Change LfL Q3 19 Q3 20 Change LfL Q3 19 Q3 20 Change LfL North America 1,487 1,377 -7.4% -4.1% 408 415 2.0% 4.8% 308 329 6.9% 9.2% 27.4% 3
Slide 21: Scope and currency impacts
APPENDIX Scope and currency impacts Scope & Currency Scope Impact on Volumes Revenue Operating EBITDA Operating EBIT (RCO) QUARTER CEM AGG RMC ASP Scope Currency Scope Currency Scope Currency North America 0 3 11 57 8 -60 0 -11 -1 -6 West / South Europe 0 0 -7 0 0 -1 1 0 1 0 North / East Europe 0 -2
Slide 22: Contact information and financial reporting calendar
FINANCIAL CALENDAR Contact information and financial reporting calendar Date Event Contact Information 18 March 2021 Full Year Results Christoph Beumelburg Director Group Communication & IR 6 May 2021 AGM & First Quarter Results Phone: +49 (0) 6221 481 13249 29 July 2021 Half Year Results christoph.
Slide 23: Disclaimer
Disclaimer Unless otherwise indicated, the financial information provided herein has been prepared credit business and, in particular, additional uncertainties arising out of the subprime, under International Financial Reporting Standards (IFRS). financial market and liquidity crises; the outcome of