Fabryka Farb I Lakierow Sniezka S.a. · GPW:SKA
Fabryka Farb I Lakierow Sniezka — Śnieżka Group — Q1-3 2022 Earnings Presentation
43 slides from Fabryka Farb I Lakierow Sniezka's earnings presentation, Nov 17, 2022
Slide 1: Presentation of Śnieżka Group's performance for Q1-3 2022
Presentation of Śnieżka Group’s performance for Q1-3 2022 17 November 2022
Slide 2: Presentation agenda: Summary
Presentation agenda Summary p. 3-7 2
Slide 3: 2022 season summary
2022 season summary 2022 season - optimal business performance to be achieved in the current environment: ▪ further increase in Śnieka's market share on the Polish market (already record-breaking). Stable position on the Hungarian market, solid strengthening of the market position on the Ukrainian m
Slide 4: Information about the Ukrainian market
Information about the Ukrainian market Śnieżka-Ukraine and activities on the Ukrainian market: ▪ A few months after the break-out of the war, the performance of the 2022 season is above expectations. The Ukrainian ▪ In the second and third quarter of this year, the demand for the Group's products on
Slide 5: Pillars of our strategy
Pillars of our strategy. EFFICIENT PERFECTLY DESIGNED STRONG BRANDS DISTRIBUTION CHANNELS PRODUCTS # 5 800 SKU Source: sell-in data, 9m 2022r
Slide 6: Strong brands - Poland
Strong brands - Poland BRAND AWARENESS VALUABLE SHARES OF BRANDS INTERIOR PAINTS ENAMELS WOOD PAINTS AND AGENTS 6 Source: Gfk Brand Tracking 2021; Gfk POS, Tracking panel sell out 8 months 2022
Slide 7: Strong brands - Hungary
Strong brands - Hungary BRAND AWARENESS VALUABLE SHARES OF BRANDS INTERIOR PAINTS ENAMELS WOOD PAINTS AND AGENTS 7 Source: Gfk Brand Tracking 2021; Gfk POS, Tracking panel sell out 8 months 2022
Slide 8: Communication activity - Poland
Communication activity - Poland ❑ Focus on supporting the key brand - MAGNAT ❑ Building its mental accessibility ❑ Improvement of brand perception in the area of colour, expertise and inspiration OFFLINE ACTIVITIES Q1-Q3 BRAND ACTIVITY ON TV SOV TV: GRP TOTAL 1891 • MAGNAT Ceramic CATEGORY ACTIVE
Slide 9: Communication activity - Hungary
Communication activity - Hungary ❑ Strengthening and consolidating the awareness and mental availability of the product among consumers OFFLINE ACTIVITIES Q1-Q3 BRAND ACTIVITY ON TV SOV TV: GRP TOTAL 2237 CATEGORY ACTIVE WEEKS 18 • Polifarbe Platinum Q1-Q3 BRAND ACTIVITY ON TV SOV TV: GRP TOTAL
Slide 10: Communication activity - Hungary
Communication activity - Hungary ❑ Building a category of ceramic paints ❑ Building mental availability of the brand OFFLINE ACTIVITIES Q1-Q3 BRAND ACTIVITY ON TV SOV TV: GRP TOTAL 1863 • MAGNAT Ceramic CATEGORY ACTIVE WEEKS 15 • OOH ONLINE ACTIVITIES CAMPAIGNS SOCIAL MEDIA DISPLAY CAMPAIGNS SEO/
Slide 11: Presentation agenda: Environment
Presentation agenda Environmen t p. 9-11 11
Slide 12: Macro 1/3 (GDP in major markets)
Macro 1/3 (GDP in major markets) Poland In the first quarter of this year Polish GDP increased by 8.6% year on year. In the second quarter of this year the economy grew by 5.8% y/y, but recorded a decrease compared to the previous quarter. In the third quarter, according to the flash estimate of the
Slide 13: Macro 2/3 (inflation across the key markets)
Macro 2/3 (inflation across the key markets) Since March this year the effects of the war in Ukraine have had a strong impact on the European and global economy. Its main macroeconomic implications are a further increase in inflationary pressure (supported, inter alia, by price surge of energy and f
Slide 14: Macro 3/3 (EUR/PLN, USD/PLN, HUF/PLN)
Macro 3/3 (EUR/PLN, USD/PLN, HUF/PLN) PLN exchange rate against the euro and the dollar In Q1-Q3 2022, the Polish zloty remained weak against the main currencies. As far as the USD/PLN exchange rate is concerned, a more dynamic weakening trend of the Polish currency is noticeable than in the case of
Slide 15: Presentation agenda: Performance
Presentation agenda Perform ance p. 13-22 15
Slide 16: Performance summary
Performance summary ▪ higher sales on the Polish market, dominant for the Group ▪ persistent premiumization of the market PLN 651.0 mln ▪ effective implementation of a long-term pricing strategy, ▪ deteriorating consumer sentiment → lower demand for of revenues (+0.1% y/y) decorative products ▪ the
Slide 17: Key markets
Key markets The Group's revenues on the Polish market amounted to PLN +2.6% 445,662 thousand and were 2.6% higher y/y. increase in sales The increase in the value of sales in Poland resulted primarily Q1-3 of 2022/ from: updating product prices in response to rising raw material Q1-3 of 2021 prices,
Slide 18: Revenues from the Hungarian market - PLN vs. HUF
Revenues from the Hungarian market - PLN vs. HUF The Hungarian market The Hungarian market (in PLN (in HUF mln) Average million) HUF/PLN exchange rate Q1-3 of 2022/ +8.7% -3.4% Q1-3 of 2021 -6.0% 18
Slide 19: Revenues from the Ukrainian market - PLN vs. UAH
Revenues from the Ukrainian market - PLN vs. UAH The Ukrainian market The Ukrainian market (in PLN (in UAH mln) Average million) UAH/PLN exchange rate Q1-3 of 2022/ -15.2% -14.4% Q1-3 of 2021 -1.0% 19
Slide 20: Geographical structure of revenues
Geographical structure of revenues (in PLN ‘000) Q1-3 of 2022 Q1-3 of 2021 change (y/y) Sales revenues of the Śnieżka Group by product categories Sales revenues structure of the Group Decorative products 515 071 510 829 0.8% by countries and product categories in the Q1-3 of 2022 Construction chemic
Slide 21: P&L (key items): Q1-3 of 2022
P&L (key items): Q1-3 of 2022 In the period between January and September 2022, the Śnieżka Group generated sales revenues 0.1% higher than the year before. The Group's performance should be analysed after the end of 2022 - due to the difficulty of predicting the future macroeconomic situation, futu
Slide 22: P&L (key items): Q3 2022
P&L (key items): Q3 2022 In Q3 2022 alone, the Group recorded a 2.8% increase in revenues (mainly a derivative of higher revenues from the Polish and other markets y/y). The improvement of operating results is primarily the result of reducing selling costs. The operating result was adversely affecte
Slide 23: Financial ratios
Financial ratios In the first 9 months of 2022, the Śnieżka Group generated lower margins than in the corresponding period of the previous year: on net profit (by 3.0 %), EBIT (by 0.4 %), EBITDA (by 0.3 %), as well as gross sales (by 1.5 %). The level of the gross margin was affected primarily by th
Slide 24: Cash flow
Cash flow In the first nine months of 2022, the Group generated positive cash flows of PLN 8,549 thousand (adjusted for exchange The Śnieżka Group’s cash flows in Q1-3 of 2022 differences). Consequently, at the end of the reporting period, cash and cash equivalents for the Group amounted to PLN 24,7
Slide 25: Balance
Balance As at September 30 the value of the Group's assets amounted to PLN 864,104 thousand, by PLN 33,014 thousand (4.0%) higher y/y. The value of the Group's fixed assets (67% of its total assets) increased by 4% during the year to PLN 579,124 thousand. This is primarily the result of development
Slide 26: Presentation agenda: Outlook
Presentation agenda Outlook p. 24-25 26
Slide 27: Outlook 1/2 (external factors)
Outlook 1/2 (external factors) The continued unfavourable macroeconomic and geopolitical environment is likely to have the greatest impact on the Group's future performance. The key will be: ▪ persistent unfavourable macroeconomic environment, e.g. boosting inflation raises concerns about the condit
Slide 28: Outlook 2/2 (internal advantages of the Group)
Outlook 2/2 (internal advantages of the Group) The Group has a number of strategic competitive advantages, including: ▪ strong brands, implemented pricing processes, a wide product portfolio (i.e. value for money segment), efficient distribution channels and a largely variable cost structure; ▪ the
Slide 29: We invite you to our new website www.sniezkagroup.com
We invite you to our new website www.sniezkagroup.com 29
Slide 30: Presentation agenda: Enclosures
Presentation agenda Enclosures p. 27-38 30
Slide 31: Selected financial information
Selected financial information Consolidated Standalone (in PLN ‘000) As at/period As at/period (in PLN ‘000) As at/period As at/period 9 months ended 9 months ended 9 months ended 9 months ended 30 September 2022 30 September 2021 30 September 2022 30 September 2021 Net sales revenues Net sales reve
Slide 32: Our foreign markets
Our foreign markets The markets where our companies are based Other foreign markets where we actively operate: Moldova Lithuania Kazakhstan Czech Republic Slovakia Romania Georgia Armenia Serbia Algeria 32
Slide 33: Our production facilities
Our production facilities Warsaw Brzeźnica, Pustków, Lubzina, Zawada Radom BELARUS 7 production facilities POLAND 4 countries, where our UKRAINE offices, facilities and warehouses Offices are located Logistics centres HUNGARY Zhodino near Minsk Bócsa Yavoriv 33
Slide 34: Product categories
Product categories PREMIUM VALUE FOR MONEY WALLS WOOD METAL FACADES PUTTIES 34
Slide 35: Our key brands 1/2
Our key brands 1/2 The products addressed to the The core brand of the Group, which An umbrella brand, which offers most demanding customers, who offers a wide range of products. Its a wide portfolio of products for value quality and style. The portfolio is comprised of products for the protection a
Slide 36: Our key brands 2/2
Our key brands 2/2 A top quality brand for wood A brand providing undercoat and A brand of professional thermal protection and decoration. The surface anticorrosive industrial insulation systems based on brand's offer has been prepared paints. Its portfolio consists of alkyd, excellent quality of de
Slide 37: Seasonality
Seasonality The industry features the phenomenon of seasonality, related to the intensity of renovation and construction works in particular periods of the year, (it is higher in spring and summer). The Group usually generates higher revenues in the second and third quarters of each financial year.
Slide 38: The key market: Poland
The key market: Poland Decorative paint products – use* of purchased paints for walls and ceilings will 71% be used for renovation previously used flats/houses The main players operating on the market of paint products and wood protection agents in Poland (which together account for 13% over 80% of
Slide 39: Market in Poland: other key manufacturers
Market in Poland: other key manufacturers Dutch manufacturer of paints and varnishes and special-purpose chemicals, listed on Euronext Amsterdam. A manufacturer of paint, varnishes, The core brands are as follows: chemicals, optical products, glass and glass fibres, listed on the New York Stock Ostr
Slide 40: Raw materials for the paint production
Raw materials for Resins - natural or synthetic substances that bind pigments and fillers in paint with each other and with the substrate. They ensure paint properties such as: the paint wash and scrub resistance and gloss. Generally, the higher the resin content, the higher the quality and resistan
Slide 41: Selected awards and distinctions
Selected awards and distinctions Ranking of the Largest Ranking of the 100 Polish Private Dividend Largest Polish SAP Innovation Companies Private Companies Awards The dividend payment of PLN 31.5 million (PLN 2.5 per share) from the Śnieżka for a second year in a Śnieżka received an award for a row
Slide 42: Disclaimer
Disclaimer Reading the content of this Presentation ("Presentation") or participation in a meeting at which this Presentation is displayed or discussed, shall be equal to the acceptance of the content of the following disclaimer. This Presentation has been prepared by Fabryka Farb i Lakierów Śnieżka
Slide 43: FFIL ŚNIEŻKA SA NOBILI PARTNERS Sp. z o.o.
Fabryka Farb i Lakierów Śnieżka SA the company’s seat: Warsaw, ul. Chłodna 51 mailing address: 39-207 Brzeźnica, ul. Dębicka 44 FFIL ŚNIEŻKA SA Aleksandra Małozięć phone: +48 667 660 399 NOBILI PARTNERS Sp. z o.o. Dariusz Grębosz phone: +48 513 284 119