Heidelberg Materials Ag · XETR:HEI
Heidelberg Materials — HeidelbergCement — Q2 2021 Earnings Presentation
26 slides from Heidelberg Materials's earnings presentation, Jul 29, 2021
Slide 1: 2021 Half Year Results
2021 Half Year Results 29 July 2021 Dr. Dominik von Achten – Group CEO Dr. Lorenz Näger – Group CFO Germany's first 3D-printed house in Beckum. © Detlef Podehl
Slide 2: Key Messages Q2 2021
Key Messages Q2 2021 ▪ Substantial increase in results in Q2 2021 – revenue +18%, operating EBITDA +22%, operating EBIT +36%; margin further improves by +76 bps (all like-for-like vs Q2 2020) ▪ Major step in portfolio optimization – disposal of US West region business ▪ High focus on shareholder ret
Slide 3: Substantial increase in results – Continuous improvement in all operational metrics
Q2/H1 2021 RESULTS Substantial increase in results – Continuous improvement in all operational metrics Revenue (m€) Operating EBITDA (m€) Operating EBITDA Margin Operating EBIT (RCO) (m€) Lfl: +11% Lfl: +26% Lfl: +76 bps Lfl: +57% +8% +23% +64 bps Lfl: +228 bps +53% Lfl: +36% Lfl: +22% +224 bps +32%
Slide 4: Good volume development in all business lines and regions
Q2/H1 2021 RESULTS Good volume development in all business lines and regions Sales volumes Development in key markets in Q2 Cement (mt) 2019 2020 2021 2021 vs. 2020* North America Q2 32.4 28.7 33.5 4.8 16.9% ▪ Volumes clearly above prior year level driven by easier comparison Half year 61.0 56.3 61.
Slide 5: Operating EBITDA increases by 22% in Q2 2021
Q2/H1 2021 RESULTS Operating EBITDA increases by 22% in Q2 2021 Q2 Operating EBITDA Bridge (m€) +21.8% 277 -66 1,182 -1 1,182 998 -28 971 Q2 2020 EBITDA Currency Q2 2020 Net volume Price over cost Q2 2021 Scope Q2 2021 EBITDA LfL EBITDA LfL EBITDA 5 2021 Half Year Results | 29 July 2021
Slide 6: Operating EBITDA improves by 360 m€ in H1 2021
Q2/H1 2021 RESULTS Operating EBITDA improves by 360 m€ in H1 2021 H1 Operating EBITDA Bridge (m€) +26.4% 340 20 1,723 -3 1,720 1,404 -41 1,363 H1 2020 EBITDA Currency H1 2020 Net volume Price over cost H1 2021 Scope H1 2021 EBITDA LfL EBITDA LfL EBITDA 6 2021 Half Year Results | 29 July 2021
Slide 7: EBITDA growth in all regions during the quarter
Q2/H1 2021 RESULTS EBITDA growth in all regions during the quarter North America Western & Southern Europe North & Eastern Europe – Central Asia m€ m€ m€ +47 +66 +24 LfL: +25% LfL: +27% LfL: +11% 335 310 231 254 288 244 Q2 2020 Q2 2021 Q2 2020 Q2 2021 Q2 2020 Q2 2021 Asia Pacific Africa – Eastern Me
Slide 8: Continuous profitability increase over the last six quarters
Q2/H1 2021 RESULTS Continuous profitability increase over the last six quarters Solid increase in profitability despite demand pressure Last 12 months rolling EBITDA margin development Last 12 months revenue LfL Last 12 months EBITDA LfL +301 bps Dec 19 Mar 20 Jun-20 Sep-20 Dec 20 Mar 21 Jun 21 22.0
Slide 9: Executing on Beyond 2020 strategy – Portfolio optimization in progress
Q2/H1 2021 RESULTS Executing on Beyond 2020 strategy – Portfolio optimization in progress U.S. West Region business (announced 05/2021) Greece AGG & RMC business (announced 05/2021) ▪ One of the markets which did not meet our ▪ No market leading positions in AGG and RMC investment criteria ▪ Disposa
Slide 10: Share buyback program with a total amount of up to 1 billion EUR announced
Q2/H1 2021 RESULTS Share buyback program with a total amount of up to 1 billion EUR announced ▪ First share buyback in HeidelbergCement’s history ▪ The company plans to buy back shares of up to 1 billion EUR until September 2023 ▪ First tranche in the amount of €300 to €350 million is scheduled to s
Slide 11: Key Financial Messages June 2021
Key Financial Messages June 2021 ▪ Significant increase in EPS – adjusted for the additional ordinary result, EPS increases by 71% to 3.1€ year-over-year ▪ Strong cash generation – LTM free cash flow at 2.3 bn€, leading to a cash conversion rate of 56% ▪ Solid deleveraging – net debt reduced by 1.5
Slide 12: Adjusted EPS increases by 71%
FINANCIAL HIGHLIGHTS Adjusted EPS increases by 71% Income Statement per June (m€) 2020 2021 Delta Key developments Revenue 8,254 8,938 +684 ▪ In the current year, the AOR includes a reversal of past RCOBD (Operating EBITDA) 1,404 1,720 +317 asset impairments related to U.S. West Region disposal Depr
Slide 13: Strong free cashflow and significant net debt reduction
FINANCIAL HIGHLIGHTS Strong free cashflow and significant net debt reduction Free cash flow generation (m€) 1) Net debt development (m€) Cash conversion rate: 56% 4,024 -1,540 8,994 -190 -321 -136 588 120 7,454 -795 2,266 -315 17 -2,266 Jun 2021 Interest Tax Change in CapEx Net Other FCF Net debt FC
Slide 14: First half of the year marks major milestones in Beyond 2020 Strategy
FINANCIAL HIGHLIGHTS First half of the year marks major milestones in Beyond 2020 Strategy Already announced cash generation and cash allocation priorities: Commitment: • Leverage 1.5x to 2.0x Commitment: • BBB flat rating Progressive dividend We continuously check for growth Growth opportunities th
Slide 15: Delivering on our ESG agenda – Q2 2021 highlights
SUSTAINABILITY Delivering on our ESG agenda – Q2 2021 highlights Building the world’s first carbon- neutral cement plant at our Slite plant in Sweden Quarry Life Award – Rating upgrades we open our quarries for from S&P to BBB the unique biodiversity with stable Dr. Nicola Kimm to competition outloo
Slide 16: EU program “Fit for 55” – CBAM can improve carbon leakage protection in Europe
SUSTAINABILITY EU program “Fit for 55” – CBAM can improve carbon leakage protection in Europe We welcome the Commission’s ambition to align the EU rules with the Green Deal We support a strengthened carbon price in combination with a Carbon Border Adjustment Mechanism (CBAM) in order to support the
Slide 17: “Business Ambition for 1.5°C” signed and UN “Race To Zero” joined
SUSTAINABILITY “Business Ambition for 1.5°C” signed and UN “Race To Zero” joined Reassuring our commitment towards carbon neutrality ▪ Signed the Business Ambition for 1.5°C Commitment (limit global warming to 1.5°C and achieving net zero carbon emissions by 2050), further acknowledging our commitme
Slide 18: Solid demand growth in all major countries
OUTLOOK & KEY TAKEAWAYS Solid demand growth in all major countries U.S. Germany Order backlogs and economic conditions are generally solid in most of Market demand expected to continue on high levels driven by the markets. Demand growth expected. Recent leading indicators and residential and infrast
Slide 19: Full year 2021 guidance raised as a result of very good business development
OUTLOOK & KEY TAKEAWAYS Full year 2021 guidance raised as a result of very good business development Initial guidance Updated guidance Slight increase in LfL operating Strong increase in LfL operating Operational Performance EBITDA and operating EBIT EBITDA and operating EBIT CapEx Net * 1.2 billion
Slide 20: Key Messages Q2 2021
Key Messages Q2 2021 ▪ Substantial increase in results in Q2 2021 – revenue +18%, operating EBITDA +22%, operating EBIT +36%; margin further improves by +76 bps (all like-for-like vs Q2 2020) ▪ Major step in portfolio optimization – disposal of US West region business ▪ High focus on shareholder ret
Slide 21: Appendix
HEIDELBERGCEMENT Appendix
Slide 22: Sales volumes
APPENDIX Sales volumes Sales Volumes Cement (‘000 t) Aggregates (‘000 t) Ready Mix (‘000 m3) Asphalt (‘000 t) QUARTER Q2 20 Q2 21 Change LfL Q2 20 Q2 21 Change LfL Q2 20 Q2 21 Change LfL Q2 20 Q2 21 Change LfL North America 3,847 4,481 633 16.5% 33,711 35,155 1,444 4.3% 1,952 2,097 145 7.4% 1,356 1,
Slide 23: Operating result
APPENDIX Operating result Operating Result Revenues (m€) Operating EBITDA (m€) Operating EBIT / RCO (m€) EBITDA Margin QUARTER Q2 20 Q2 21 Change LfL Q2 20 Q2 21 Change LfL Q2 20 Q2 21 Change LfL Q2 20 Q2 21 Change LfL North America 1,216 1,269 4.4% 12.2% 288 335 16.2% 25.2% 191 251 31.6% 42.1% 23.7
Slide 24: 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 0 0 0 0 -85 0 -21 0 -14 West / South Europe 0 0 0 0 -4 8 -1 0 0 0 North / East Europe 0 0 0
Slide 25: Contact information and financial calendar
FINANCIAL CALENDAR Contact information and financial calendar Date Events Contact Information 7 September 2021 Exane BNP Paribas ESG Conference Christoph Beumelburg 9 September 2021 Davy Building Materials & Industrials Conference Director Group Communication & Investor Relations Phone: +49 (0) 6221
Slide 26: 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