Slide 1: Second Quarter 2019 Results
SECOND QUARTER 2019 RESULTS 1 AUGUST 2019
Slide 2: 2Q'19 Performance
2Q’19 PERFORMANCE SALES EBITDA ADJ. NET INCOME FREE CASH FLOW In €m In €m In €m In €m 70% 18.1% €2.52 > x2 SPECIALTIES MARGIN ADJ. EPS 2,270 2,254 430 407 90 226 192 41 2Q'18 2Q'19 2Q'18 2Q'19 2Q'18 2Q'19 2Q'18 2Q'19 As of 1 January 2019, the Group applies the IFRS 16 standard “Leases”. Impact on EB
Slide 3: 2Q'19 Financial Highlights
2Q’19 FINANCIAL HIGHLIGHTS Close to 2Q’18 level (€2,270m) €2,254m sales +4.7% prices in High Performance Materials Good resilience against 2Q’18 record performance (€430m) in a more challenging €407m EBITDA macroeconomic environment 2nd time ever with quarterly EBITDA > €400m Very solid 18.1% EBITDA
Slide 4: Organic Projects Highlights Since January 2019
ORGANIC PROJECTS HIGHLIGHTS SINCE 1 JANUARY 2019 SPECIALTY POLYAMIDES PEKK SARTOMER COATING RESINS Singapore United States China India New bio-based Rilsan® PA11 (monomer + polymer) plant 30% photocure resins capacity New unit started in 1Q’19 New unit started in 1Q’19 in Jurong Island to be started
Slide 5: Specialties Reinforced by Several Bolt-on Acquisitions and Partnerships
SPECIALTIES REINFORCED BY SEVERAL BOLT-ON ACQUISITIONS AND PARTNERSHIPS ARRMAZ PROCHIMIR LAMBSON Specialty surfactants High performance thermobonding Photoinitiators for curing technology for crop nutrition, mining adhesives films for automotive, used in 3D printing, electronics, and infrastructure
Slide 6: Proposed Acquisition of Prochimir
PROPOSED ACQUISITION OF PROCHIMIR POSITION BOSTIK AMONG WORLD-LEADING PLAYERS IN THERMOBONDING FILMS Prochimir, a renowned leader in high-performance thermobonding films ● 3 production facilities in France and in the US with state-of-the-art process ● Exports accounting for 75% of sales Environmenta
Slide 7: Proposed Acquisition of Lambson
PROPOSED ACQUISITION OF LAMBSON EXPAND SARTOMER’S PORTFOLIO OF SOLUTIONS Lambson specialized in photoinitiators, used to initiate polymerization reactions during the UV-curing process Perfect complementarity between Lambson’s Electronics 3D printing photoinitiators and Sartomer’s resins range for fa
Slide 8: Breakdown by Division and Region
BREAKDOWN BY DIVISION AND REGION 1H’19 SALES BY DIVISION 1H’19 SALES BY REGION Specialties 71% 25% 31% 38% 45% Intermediates 29% 30% 31% High Performance Materials Europe 23% Adhesives 22% Advanced Materials North America Industrial Specialties Asia and RoW Coating Solutions 8 FULL YEAR 2018 RESULTS
Slide 9: 2Q'19 Key Figures
2Q’19 KEY FIGURES In €m (except EPS) 2Q’18 2Q’19 CHANGE Sales 2,270 2,254 -0.7% EBITDA 430 407 -5.3% EBITDA margin 18.9% 18.1% Recurring operating income (REBIT) 318 278 -12.6% REBIT margin 14.0% 12.3% Adjusted net income 226 192 -15.0% Net income – Group share 219 176 -19.6% Adjusted EPS (in euros)
Slide 10: 2Q'19 Sales Bridge
2Q’19 SALES BRIDGE SALES In €m Scope Volumes Price of business Currency (2.4)% (0.6)% +0.4% +1.9% Lower demand in Continued strong Acquisitions in Stronger US dollar automotive, oil & gas pricing actions in adhesives against the euro and consumer High Performance electronics Materials (+4.7%) Strong
Slide 11: High Performance Materials (44% of Group Sales)
HIGH PERFORMANCE MATERIALS (44% OF GROUP SALES) 2Q’19 KEY FIGURES 2Q’19 SALES DEVELOPMENT 2Q’19 SALES BY BUSINESS LINE In €m 2Q’18 2Q’19 Change Volumes (8.0)% Sales 1,007 998 (0.9)% 25% 23% Bostik Prices +4.7% EBITDA 177 170 (4.0)% Performance Additives Currency +1.7% EBITDA margin 17.6% 17.0% 52% T
Slide 12: Industrial Specialties (30% of Group Sales)
INDUSTRIAL SPECIALTIES (30% OF GROUP SALES) 2Q’19 KEY FIGURES 2Q’19 SALES DEVELOPMENT 2Q’19 SALES BY BUSINESS LINE In €m 2Q’18 2Q’19 Change Volumes (1.3)% 13% PMMA Sales 709 673 (5.1)% Prices (5.7)% 32% Thiochemicals EBITDA 208 179 (13.9)% 28% Currency +1.9% Fluorogases EBITDA margin 29.3% 26.6% 27%
Slide 13: Coating Solutions (26% of Group Sales)
COATING SOLUTIONS (26% OF GROUP SALES) 2Q’19 KEY FIGURES 2Q’19 SALES DEVELOPMENT 2Q’19 SALES BY BUSINESS LINE In €m 2Q’18 2Q’19 Change Volumes +6.7% Sales 547 576 +5.3% Prices (3.8)% Coating Resins 48% and Additives EBITDA 68 82 +20.6% 52% Currency +2.4% EBITDA margin 12.4% 14.2% Acrylics Rec. opera
Slide 14: Excellent Cash Generation
EXCELLENT CASH GENERATION RECONCILIATION OF EBITDA TO NET CASH FLOW 2Q’19 HIGHLIGHTS In €m 2Q’18 2Q’19 Limited increase of working capital versus 2Q’18 EBITDA 430 407 ● Tight management, activity levels and Current taxes (64) (47) favorable impact of lower raw materials costs on inventories Cost of
Slide 15: 2Q'19 Net Debt Bridge
2Q’19 NET DEBT BRIDGE In €m 0.9x LTM EBITDA 26% gearing 38 13 3 1,308 190 1,130 (90) 24 31/03/2019 Free cash flow M&A Dividend Hybrid partial Share FX and 30/06/2019 refinancing buybacks others 15 SECOND QUARTER 2019 RESULTS
Slide 16: 1H'19 Performance
1H’19 PERFORMANCE SALES EBITDA ADJ. NET INCOME FREE CASH FLOW In €m In €m In €m In €m +0.6% 17.4% €4.68 x10 MARGIN ADJ. EPS 4,442 4,469 813 163 777 421 357 16 1H'18 1H'19 1H'18 1H'19 1H'18 1H'19 1H'18 1H'19 As of 1 January 2019, the Group applies the IFRS 16 standard “Leases”. Impact on EBITDA is a
Slide 17: 1H'19 Key Figures
1H’19 KEY FIGURES In €m (except EPS) 1H’18 1H’19 CHANGE Sales 4,442 4,469 +0.6% EBITDA 813 777 -4.4% EBITDA margin 18.3% 17.4% Recurring operating income (REBIT) 595 525 -11.8% REBIT margin 13.4% 11.7% Adjusted net income 421 357 -15.2% Net income – Group share 407 323 -20.6% Adjusted EPS (in euros)
Slide 18: 2019 Outlook
2019 OUTLOOK 2H’19 macroeconomic environment should remain volatile and complex ● Continued geopolitical uncertainties are weighing on global demand and raw material volatility ● Inventory adjustments in certain end-markets expected to ease Continued focus on internal momentum and implementation of
Slide 19: Disclaimer
DISCLAIMER The information disclosed in this document may contain forward-looking statements with respect to the financial condition, results of operations, business and strategy of Arkema. Such statements are based on management’s current views and assumptions that could ultimately prove inaccurate