Dsm-firmenich Ag · EURONEXT:DSFIR
Dsm-firmenich — Royal DSM — Shareholder Meeting (May 2017)
40 slides from Dsm-firmenich's shareholder meeting presentation, May 3, 2017
Slide 1: Annual Results 2016
Annual Results 2016 Feike Sijbesma, CEO & Chairman Managing Board Royal DSM Annual General Meeting, May 3 2017 ROYAL DSM HEALTH NUTRITION MATERIALS
Slide 2: Safe harbor statement
Safe harbor statement This presentation may contain forward-looking statements with respect to DSM’s future (financial) performance and position. Such statements are based on current expectations, estimates and projections of DSM and information currently available to the company. DSM cautions reade
Slide 3: Agenda
Agenda Introduction to DSM DSM’s transformation & DSM today Strategy 2018 – Driving profitable growth through science-based, sustainable solutions delivering higher value for all Stakeholders Annual Results 2016 Profit, People, Planet Future proofing DSM’s results Growth, Science & Innovation will d
Slide 4: Royal DSM's successful transformation
Royal DSM’s successful transformation Coal Mining (Petro) Chemicals Life Sciences & Materials Sciences Page 3
Slide 5: New portfolio creates good growth platforms
New portfolio creates good growth platforms Pharma EBA’s Agro ▪ Divested bulk chemicals & Melamine Bulk pharma businesses Chemicals Materials Petrochem Energy Elastomers ▪ Built broad, deep & global Nutrition business ▪ Upgraded Materials businesses Nutrition ▪ Created 3 new growth platforms (EBA’s)
Slide 6: History based on science & innovation
History based on science & innovation DSM (1902) Energy, chemistry & Vitamins & Minerals polymer technology Food Omega’s & Carotenoids Premixes food & feed Feed Enzymes, Cultures & Yeasts Materials Sciences Personal Nutraceuticals Pharmaceuticals Gist-brocades (1869) Care High Performance Plastics B
Slide 7: DSM today (2016 in m€)
DSM today (2016 in m€) Sales Adj. EBITDA Adj. EBITDA% ROCE €7,920m €1,262m 15.9% 10.4% Nutrition EBA’s Materials Sales Sales Sales Animal Nutrition Engineering € 5,169 € 167 € 2,513 Plastics Human Nutrition Biomedical Adj. EBITDA Adj. EBITDA Resins & € 931 Food Specialties € 435 Functional Materials
Slide 8: DSM today has significant value in legacy JV - associates
DSM today has significant value in legacy JV - associates 50% 34% 35% DSM Sinochem Pharmaceuticals Patheon Pharma ChemicaInvest 2016 2016 1 2016 Sales (€m – 100%) 431 Sales (€m – 100%) 1,786 Sales (€m – 100%) 1,802 Adj.EBITDA 14 % Adj.EBITDA 20 % Adj.EBITDA 6% 1. Book year 1 November until 31 Octobe
Slide 9: DSM transformed in an intrinsically innovative company
DSM transformed in an intrinsically innovative company 22% New Materials & Biotech/Food Lab (2016) Top Quartile Innovation Innovation Sales Benchmark (2% - 2006*) All @ Higher Gross Margins * As reported in 2006 Annual Report / 2006 Triple P report (not restated) Page 8
Slide 10: DSM has become a true global company
DSM has become a true global company Global workforce (FTE) Net sales by destination (%) 3% 10% North America Europe Asia 2% 3% 29% > 3,000 > 9,000 > 6,000 12% 6% 12% 23% Africa: W-Europe China 73 employees Eastern Europe India JV’s Latin America RoW North America Japan > 2,000 > 250 Latin America R
Slide 11: With a more diverse, more agile, highly engaged workforce
With a more diverse, more agile, highly engaged workforce Engagement score 71 % Female Executives > 15% (7% - 2006*) * As reported in 2006 Annual Report / 2006 Triple P report (not restated) Page 10
Slide 12: Committed to improve health & safety everywhere
Committed to improve health & safety everywhere 0.33 (2016) Frequency Index recordable accidents (0.89 – 2006*) * As reported in 2006 Annual Report / 2006 Triple P report (not restated) Page 11
Slide 13: Impressive improvement reducing DSM's ECO footprint
Impressive improvement reducing DSM’s ECO footprint 2006* Greenhouse Gas Emissions (m CO2 eq.): 10.4 1.5 (-85%) Energy-use (PJ): 74 22.6 (-70%) 2025: GHG reduction: 45% Renewable Electricity: 50% 2016 * As reported in 2006 Annual Report / 2006 Triple P report (not restated) Page 12
Slide 14: Strong performance reflected in higher dividend and share price
Strong performance reflected in higher dividend and share price 2016 200 ~€65 175 150 125 ~€35 +90% Dividend €1.75 100 +75% 75 2006 50 25 DSM AEX 0 Dividend €1.00 May-13 May-07 May-08 May-09 May-10 May-11 May-12 May-14 May-15 May-16 Page 13
Slide 15: Agenda: Strategy 2018
Agenda Strategy 2018 Delivering higher value for all Stakeholders Page 14
Slide 16: DSM's strategy well aligned with UN Sustainable Development Goals
DSM’s strategy well aligned with UN Sustainable Development Goals NUTRITION CLIMATE & ENERGY CIRCULAR & BIO-BASED ECONOMY Page 15
Slide 17: Strategy 2018
Strategy 2018 Driving profitable growth through science-based, sustainable solutions Page 16
Slide 18: Growth above market strategy in Nutrition
Growth above market| strategy in Nutrition 1▪ Expand the core ▪ Vitamin B6 plant ▪ Expansion gellan-gum and pectin ▪ Expanding premix network ▪ Add new products and solutions 2 Clean Cow: > 25% methane reduction ▪ Eubiotics for antibiotic-free poultry ▪ Stevia (low calorie natural sweetener) ▪ “Gree
Slide 19: Growth above market strategy in Nutrition
Growth above market| strategy in Nutrition 3▪ Expand in new segments/regions ▪ MEG-3® Ultra (high-concentrate) DHA (EPA) ▪ Expansion fast-growing i-Health consumer line 4▪ New business models ▪ Business to farmer network Page 18
Slide 20: Growth above market strategy in Materials
Growth above market| strategy in Materials Accelerate growth in specialties Engineering Plastics ultra-thin USB connectors (high-temperature polyamides) Resins & Functional Materials waterborne coatings Niaga – recycle carpets Dyneema high performance fabric solutions Page 19
Slide 21: Ambitious cost reduction & efficiency improvement programs
Ambitious cost reduction & efficiency improvement programs Cost savings of €250-300m (2018) Timing cumulative cost savings ~€m Realized Forecast Nutrition 400 Program €130-150m 300 DSM-wide support 200 functions ~110 €125-150m 100 Materials ~25 0 2015 2016 2017 2018 Page 20
Slide 22: Stepping-up sustainability aspirations Brighter Living Solutions
Stepping-up sustainability aspirations Brighter Living Solutions 65% DSM’s profitable solutions should be better for people and planet Page 21
Slide 23: Agenda: Annual Results 2016 - Profit, Planet, People
Agenda Annual Results 2016 - Profit, Planet, People Page 22
Slide 24: Annual Results 2016: delivering higher value for all Stakeholders
Annual Results 2016: delivering higher value for all Stakeholders Page 23
Slide 25: Highlights Financials 2016
Highlights Financials 2016 ▪ Sales up 3% to €7,920m, with 4% organic growth ▪ Innovation sales at 22% of portfolio ▪ Adjusted EBITDA up 17% to €1,262m ▪ Cost savings on track: €110m ▪ Working Capital improved from 20.7 to 18.6% ▪ CAPEX of €475m within guidance (€500-550m) ▪ Cash from operating activ
Slide 26: Highlights Financials 2016 Nutrition and Materials
Highlights Financials 2016 Nutrition and Materials Nutrition: ▪ Strong 5% organic growth ✓ Adj. EBITDA up 13% to €931m ✓ 8% organic growth Animal Nutrition (strong volume growth except Latin America) ✓ Significant step-up organic growth Human Nutrition (+4%), highlighting implementation growth strat
Slide 27: Strong performance reflected in higher dividend and share price
Strong performance reflected in higher dividend and share price Dividend per ordinary DSM share - € DSM vs. Peers, AEX & DJS Chemicals 140 2.00 5.0% 1.75 1.75 4.0% 120 1.65 1.65 1.65 1.50 1.50 1.45 3.0% 100 1.25 2.0% 80 1.00 1.0% 60 May-16 Jun-16 Mar-16 Sep-16 Mar-17 Nov-15 Dec-15 Jul-16 Aug-16 Nov-
Slide 28: Highlights Planet 2016
Highlights Planet 2016 ▪ GHG efficiency improvement 4% (target 2016-2025: 25%) ▪ Energy efficiency improvement 2% (target 2015-2025: >10%) ▪ Renewable electricity purchased 8% (target 2025: 50%) ▪ Waste recycled: 83% (target 2020: 80-90%) Page 27
Slide 29: Future-proofing DSM - thriving in a low (fossil) carbon economy
SECRET Future-proofing DSM - thriving in a low (fossil) carbon economy ▪ Securing a cleaner future energy supply ▪ Enhancing efficiency ▪ Offering climate-relevant Brighter Living Solutions ▪ Shaping partnerships and policies that accelerate the shift ▪ Ensuring climate readiness (internal CO2 price
Slide 30: DSM CEO co-chair of World Bank Carbon Pricing Leadership Coalition
SECRET DSM CEO co-chair of World Bank Carbon Pricing Leadership Coalition Page 29
Slide 31: DSM's Bright Minds Challenge
SECRET DSM’s Bright Minds Challenge is identifying innovative solutions and new materials that will fast-track the movement toward 100% renewable energy. Page 30
Slide 32: Highlights People 2016
Highlights People 2016 ▪ UN Women's Empowerment Principles ▪ Employee Engagement favorable at 71% (2015 69%; target 2020: 75%) ▪ Frequency index recordable injuries to 0.33 (2015: 0.41; target 2020: 0.25) ▪ Proud on partnerships contributing to SDG’s including UN-WFP and AIF Page 31
Slide 33: External recognition (2016) for our leadership
External recognition (2016) for our leadership ▪ Leader Dow Jones Sustainability Index ▪ Fortune 50 leading companies changing the world ▪ Corporate Knights Materials Leader ▪ Biofuels 40 Hottest Emerging Companies ▪ Best Ethical Corporation Responsible Business Awards ▪ Leader in Sustainalytics Pag
Slide 34: The most heartwarming recognition
The most heartwarming recognition Page 33
Slide 35: To summarize: DSM delivers on all targets
To summarize: DSM delivers on All targets | People, planet, profit Page 34
Slide 36: Agenda: Future proofing DSM
Agenda Future proofing DSM – Growth, Science & Innovation driving earnings growth beyond 2018 Page 35
Slide 37: Science & Innovation driving earnings >2018
Science & Innovation driving earnings >2018 (> €300m profit potential) 1) Sustainable Stevia Clean Cow Omega-3 solution for aquaculture Maternal nutrition + Bio-medical + Bio-based Niaga - recyclable carpet High performance fabrics (Dyneema®) Solar Page 36 1) Potential additional Adj. EBITDA (non ri
Slide 38: Agenda: Highlights Q1 Results
Agenda Highlights Q1 Results Page 37
Slide 39: Highlights Q1 2017
Highlights Q1 2017 ▪ DSM reports a very strong first quarter ▪ Sales up 13% to €2,159m, with 9% organic growth ▪ Adjusted EBITDA up 17% to €345m ▪ ROCE up 150 bps to 11.3% ▪ Cash from operating activities up 43% to €196m ▪ Net profit up 75% to €149m ▪ Outlook maintained: DSM aims to deliver high-sin
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