Vow Asa · OSL:VOW
Vow Asa — Investor Day (November 2023)
44 slides from Vow Asa's investor day presentation, Nov 28, 2023
Slide 1: Capital Markets Update
CAPITAL MARKETS UPDATE Oslo, 28 November 2023
Slide 2: Disclaimer
DISCLAIMER This presentation has been prepared by the management of Vow ASA using commercially reasonable efforts to provide estimates and information about the company and prospective new markets. The presentation includes and is based, inter alia, on forward-looking information and statements that
Slide 3: Agenda
AGENDA Introduction | A brief trading update by Henrik Badin, CEO Financial update, outlook for 2023 by Tina Tønnessen, CFO and Jonny Hansen, COO Business deep dive and outlook Decarbonising the metallurgic industry • Outokumpu’s green steel initiative by Timo Huhtala, General Manager, Biocoke proje
Slide 4: Q3 2023 Key Takeaways
Q3 2023 | KEY TAKEAWAYS YTD 2023 Revenues Revenues YTD was 703 million, the result of increased demand for Vow’s +18% technology and customers across a wide range of industries 703 y-o-y million Inflation and higher costs in the supply chain for some projects resulted in EBITDA YTD of 14.1 million •
Slide 5: Strong momentum across our business
STRONG MOMENTUM ACROSS OUR BUSINESS 17 July 1 August 29 August 17 September Major milestone reached in Vow’s Vow secures long-term funding to Vow bags another cruise retrofit Vow secures contracts for key CHE breakthrough US project expand operations for large-scale cleantech contract worth USD 5 mi
Slide 6: Business segments
BUSINESS SEGMENTS EBITDA margin and share of group revenue YTD Q3 2023 INDUSTRIAL MARITIME AFTERSALES Increased activity and cost Continued high activity Breaking new records, well of building pipeline and good performance above pre-pandemic levels 0.9% 37% 9.2% 44% 13.7% 19% EBITDA margin EBITDA ma
Slide 7: Industrial Solutions
INDUSTRIAL SOLUTIONS Formerly named Landbased With several contracts confirmed, capacity utilisation has significantly improved, converting into higher revenues and margins Continued high activity in Heat Solutions, C.H. Evensen running at close to full capacity, and strong demand for electrificatio
Slide 8: Heat Treatment Solutions
HEAT TREATMENT SOLUTIONS Heat Treatment Solutions Successful acquisition of Increased C.H.Evensen Industriovner (CHE) in 2022 opened new demand drives sales market for Vow in heat Revenues in NOK million treatment solutions 125 CHE enjoys long-lasting and strong relationships formed over five decade
Slide 9: Building business on the energy transition
BUILDING BUSINESS ON THE ENERGY TRANSITION Regulators and capital markets drive Heat Treatment Solutions transition to non-fossil solutions Firm quotations in Creates strong interest from heat pipeline by type of project intensive industries for Vow’s CHE Total NOK 1 billion technology for electrifi
Slide 10: Maritime Solutions
MARITIME SOLUTIONS Formerly named Cruise Projects Continued to deliver strong topline, driven by high activity and completion of projects EBITDA impacted by reassessed cost prognosis in the project portfolio. For full-year 2023, EBITDA margin is expected to be slightly above margin year-to-date Oper
Slide 11: Strong order backlog and pipeline
STRONG ORDER BACKLOG AND PIPELINE Current backlog comprises 32 confirmed Ships with Vow equipment orders for cruise ships under construction In backlog, confirmed Tendering is ongoing or underway for an In backlog as ‘option’ Currently being bid additional 46 ships 1 7 1 6 Shipowners show significan
Slide 12: The latest and greatest in cruise
THE LATEST AND GREATEST IN CRUISE Combustion system and steam boiler “MAP1 is the latest and greatest in waste management.” Pyrolysis reactor Greg Purdy, Senior Vice President, Infeed Marine Operations, Char system Royal Caribbean International Char cooler outlet 1 Pyrolysis 12 Photo: Royal Caribbea
Slide 13: Aftersales
AFTERSALES Reports and remarks by the large cruise operators indicate that the cruise market has recovered fully from the 2020-21 shutdown Activity in Aftersales which is closely correlated with the number of cruise ships in operation, has climbed to record levels 50 million Revenues and EBITDA are
Slide 14: Financials
FINANCIALS
Slide 15: Income statement
INCOME STATEMENT Key figures NOK million Q3 2023 Q3 2022 YTD Q3'23 YTD Q3’22 Revenues YTD Q3 2023 up 18% compared to same period last year Revenue 254.6 193.7 703.3 593.6 Lower gross margins due to inflation and Gross profit 52.0 76.7 224.8 227.5 higher cost in supply chain Gross margin % 20.4% 39.6
Slide 16: Balance sheet
BALANCE SHEET Key figures NOK million 30.09.23 30.06.23 31.12.22 Increase in intangible assets and goodwill relate to investments in new technology for Intangible assets and goodwill 566.7 563.9 512.1 future growth and currency effects Accounts receivable 385.9 288.2 293.6 Increase in working capita
Slide 17: Cash flow
CASH FLOW Key figures Operational cash flow impacted by build-up in NOK million Q3 2023 YTD Q3'23 FY 2022 working capital and negative result for the period Cash and cash equivalents 17.0 42.5 141.1 Investments for the period mainly relate to at start of period new technology within Industrial Solut
Slide 18: A closer look at Q3
A CLOSER LOOK AT Q3 Key factors Key reasons Inflation New ERP system Especially in Poland, where most of Vow’s Challenging transition period from old to new production capacity for cruise is located system, rendering visibility into key data Supply chain High activity level Global latency and bottle
Slide 19: Comprehensive program for controlled and profitable growth
COMPREHENSIVE PROGRAM FOR CONTROLLED AND PROFITABLE GROWTH Complete mapping of working processes, including improved routines and more frequent project reviews Close dialogue and intensified follow up with Guiding for 2023 and beyond suppliers, including benchmarking Target group revenues above NOK
Slide 20: Business deep-dive and outlook
BUSINESS DEEP-DIVE AND OUTLOOK In situ auxiliary systems and Vow equipment at NSR’s biochar factory in Sweden
Slide 21: Decarbonising metallurgical industries
DECARBONISING METALLURGICAL INDUSTRIES Outokumpu’s green steel initiative Timo Huhtala, General Manager, Biocoke project at Outokumpu Capacity expansion at Follum Cecilie Jonassen, CEO Vow Green Metals
Slide 22: Majors are stepping up
MAJORS ARE STEPPING UP Outokumpu has set ambitious targets to reduce CO2 emissions by 42% by 2030 from the base year of 2016 Replacing fossil coke with biocoke is considered key to reduce direct emissions from its metallurgical processes Vow and Outokumpu have been in technical and commercial discus
Slide 23: Towards the world that lasts forever
Towards the world that lasts forever Outokumpu x Vow ASA CMD November 2023 Timo Huhtala, General Manager, Outokumpu Biocoke project
Slide 24: Stainless steel has a crucial role in accelerating green transition
24 Stainless steel has a crucial role in accelerating green transition across industries Ambitious climate target Reducing customers’ aligned with 1.5 degrees emissions with low-carbon ambition stainless steel Outokumpu is the only stainless steel company The future of green solutions – from renewab
Slide 25: Our green transition roadmap
Our green transition roadmap 42 % target to reduce direct and indirect emissions as well as supply chain emissions per tonne of stainless steel by 2030 from a 2016 base year Reducing emissions across our value chain Scope 3 Scope 2 Scope 1 Highest recycled material Energy efficiency and low- Switchi
Slide 26: Cornerstones in the transition towards biomass-based materials
26 Cornerstones in the transition towards the use of biomass-based materials External Building of Investments to sourcing partnerships own production Footer
Slide 27: Slide 27
Slide 28: Significant shift in the market – increasing demand for biobased reduction materials
Significant shift in the market – increasing demand for biobased reduction materials Important step for biocarbon producers using VOW technology The VGM technical and operations team visiting Envigas’ production facility in Bureå, Sweden, earlier in November 28
Slide 29: Vow Green Metals
VOW inetais
Slide 30: Latest VGM news: industrial players investing up to NOK 250 million
LATEST VGM NEWS: Significant industrial players with up to NOK 250 million investment in Vow Green Metals Siva to invest NOK 152 million in Vow Green Metals’ Vardar with strategic investment of up to NOK 100 large-scale biocarbon production at Hønefoss million in Vow Green Metals “This is the starti
Slide 31: Vow Green Metals add value to biocarbon investment portfolios
Vow Green Metals add value to biocarbon investment portfolios Vow Green Metals value VGM AS proposition ✓ Originating and developing attractive projects Project Product & development market ✓ Advancing operations according to best practice ✓ Progressing standardization efforts utilizing unique acces
Slide 32: Materials recovery and renewable energy
MATERIALS RECOVERY AND RENEWABLE ENERGY The Circon partnership David Duren, Chairman, Chief Executive Officer, and Founder of Circon Energy Perspectives and status in ELT Valorising sewage sludge and neutralising PFAS
Slide 33: Joining forces for carbon recycling
JOINING FORCES FOR CARBON RECYCLING Vow has signed long-term cooperation The Carbon Refinery® will be processing agreement with Circon Energy and a long-term feedstock sourced from organic components equipment supply agreement to be the of municipal solid wastes, plastics, end-of-life exclusive prov
Slide 34: Circon
circon’ Leading The Carbon Retgiitions > at a SS ee
Slide 35: Leading The Carbon Revolution
Leading The Carbon Revolution® The energy transition is fueled by The Carbon Revolution® Circon is leading the way to demonstrate responsible energy built on true financial, technical, and environmental sustainability. Integrating proven science and technology to rethink environmental stewardship by
Slide 36: The Circular Economy
The Circular Economy Acontinuous cycle of use, regeneration and reutilization which minimizes waste, maximizes resource efficiency, and represents eco-friendly productivity where moral and social ethics are prioritized alongside financial returns. + Economic development through waste management + Or
Slide 37: Effective Partnership
Effective Partnership Vow ASA is the global thought leader with the most significant market eogagement in waste valorization 35+ years of commercialized outcomes + “Global Expert” in biochar processing + Broadest range and scale of applications + Professional, engaged, and committed culture Circon i
Slide 38: True Sustainability
circon’ True Sustainability To survive the dynamic global marketplace solutions must represent sustainable financial, technical, AND social practices or they are not truly sustainable + Financial - independently strong without reliance on government subsidies + Technical - flexible to meet the chang
Slide 39: Disclaimer
Disclaimer ‘This material has been prepared by Circon Energy LLC (the Company) to assist in making a preliminary analysis of the content referenced herein solely for informational purposes. It should not be construed asa solicitation or an offer to buy or sll any securities and should no be treated
Slide 40: End-of-life tires update
END-OF-LIFE TIRES UPDATE During 2023, Vow and its partner ETEL have finalized process engineering and confirmed business model for the valorisation of 100% of ELT into recovered carbon black (rCB) and low carbon energy Feasibility studies for first production sites with Vow technology in Great Brita
Slide 41: Feed for thought
FEED FOR THOUGHT FEED contract confirms strong demand for solutions that can eliminate PFAS1 in sludge … and confirms relevance of Vow’s pyrolysis technology FEED contract confirmed and work underway for industry-scale sewage sludge treatment and energy generation plant underway 1 PFASs are organic
Slide 42: Concluding remarks
CONCLUDING REMARKS
Slide 43: Summary
SUMMARY Revenues YTD was 703 million, the result of increased demand for Vow’s technology Third quarter profits hit by inflation and higher costs in some projects, resulting in an EBITDA YTD of 14.1 million Order backlog was 1.1 billion at end of Q3, and all of Vow’s main markets remain strong Signi
Slide 44: Believing in a future where industry is harmonized with nature
BELIEVING IN A FUTURE WHERE INDUSTRY IS HARMONIZED WITH NATURE