Slide 1: Welcome to HEXPOL – Q4 2019 Report update
Welcome to HEXPOL Q4, 2019 Report update January 30, 2020 CEO Mikael Fryklund CFO Peter Rosén January 30, 2020 -1-
Slide 2: Agenda
Agenda • Introduction to HEXPOL • Q4 2019 – HEXPOL Group • Q4 2019 – Business areas • Q4 2019 – Summary • January – December 2019 – Key figures • Implications restructuring and integration • Q&A January 30, 2020 -2-
Slide 3: HEXPOL – Fast growing with strong margins
HEXPOL – Fast growing with strong margins HEXPOL is a world leading polymers group with strong global positions in advanced polymer compounds (Compounding), gaskets for plate heat exchangers (Gaskets) and wheels made of plastic and rubber materials for forklifts and castor wheel applications (Wheels
Slide 4: HEXPOL – Our vision guides us
HEXPOL - Our vision guides us HEXPOL’s vision is to be market leader, number one or two, in selected technological or geographical segments, to generate profit, growth and shareholder value. January 30, 2020 -4-
Slide 5: HEXPOL – A well positioned Group
HEXPOL – A well positioned Group • Two business areas: ‒ HEXPOL Compounding ‒ HEXPOL Engineered Products • Strong global market positions: • Global presence – Global leading position for Rubber Compounding • Operations in 14 countries – Strong European position in Thermoplastic • Around 5,100 employ
Slide 6: HEXPOL – A well positioned Group
HEXPOL – A well positioned Group • True global footprint • Acquisition oriented – major acquisitions within Compounding: • Historical strong sales growth and good profitability 2010: Elasto, Excel Polymers 2012: Müller Kunststoffe, Robbins • Well invested and strong cash flow 2014: Kardoes, Vigar Ru
Slide 7: HEXPOL – A fast growing Group
HEXPOL – A fast growing Group July 1, 2019: Acquisition of Preferred Comp.,USA, MX 2019 Sales 2018 Acquisition of: • Rubber Compoundern Kirkhill, USA • Mesgo, Italy, Poland och Turkey 15,508 MSEK 2017 Acquisition of: • Trelleborgs Rubber Compounding enhet, Czech Republic • Valley Processing, USA 201
Slide 8: HEXPOL – A fast growing Group
HEXPOL – A fast growing Group HEXPOL Compounding, value chain* (example): Raw material Manufacturer Rubber and End manufacturers of polymer plastic component OEMs customers compounds manufacturers -Rubber -Silicone -TPE -FKM -PP (reinforced) -PA Business model: The market: • “Glocal” (local producti
Slide 9: HEXPOL – Organisation and sales distribution
HEXPOL – Organisation and sales distribution HEXPOL – With a stable organisation Two business areas: • HEXPOL Compounding (93% of sales) • HEXPOL Engineered Products (7% of sales) HEXPOL AB HEXPOL HEXPOL Compounding Engineered Products 93% of sales 7% of sales HEXPOL HEXPOL HEXPOL HEXPOL HEXPOL HEXP
Slide 10: HEXPOL – A fast growing Group
HEXPOL – A fast growing Group Main customer segments: • Automotive – Sales around 36% • Engineering & general industry – Sales around 30% • Building & construction – Sales around 10% • Transportation • Consumer industries • Energy, oil & gas • Wire & cable • Medical equipment • Manufacturers of plat
Slide 11: HEXPOL – A fast growing Group
HEXPOL – A fast growing Group EBIT, MSEK Sales, MSEK *Adjusted for non-recurring items January 30, 2020 - 11 -
Slide 12: HEXPOL acquired Preferred Compounding in the beginning of July 2019
HEXPOL acquired Preferred Compounding in the beginning of July 2019 • Preferred brings significant competitive advantage to our customers in the Americas region, with improved supply chain and leading research, development and engineering services • Preferred adds also high performance elastomers ca
Slide 13: Q4 2019 – Increased sales driven by acquisitions
Q4 2019 – Increased sales driven by acquisitions 2019 2018 2019 MSEK Q4 Q4 Q3 Sales 3 774 3 557 4 244 EBITA, excl. non-recurring items 543 533 604 +6% EBITA margin, excl. non-recurring items, % 14,4 15,0 14,2 Operating profit, excl. non-recurring items 522 522 583 Operating margin, excl. non-recurri
Slide 14: Q4 2019 – Increased sales driven by acquisitions
Q4 2019 – Increased sales driven by acquisitions – Sales development 6% Q4 (%) Acquisition 15 Organic -13 Currency 4 Total 6 13% Jan-Dec (%) Acquisition 16 Organic -9 Currency 6 Total 13 January 30, 2020 - 14 -
Slide 15: HEXPOL – Sales split and development per region
HEXPOL – Sales split and development per region – Sales split and sales development per region, 2019 compared to 2018 Europe Share Q4 Jan-Dec 36% -1% 18% Americas Share Q4 Jan-Dec 59% 12% 11% Asia Share Q4 Jan-Dec 5% -2% -5% January 30, 2020 - 15 -
Slide 16: Q4 2019 – Increased sales driven by acquisitions
Q4 2019 – Increased sales driven by acquisitions - Strong balance sheet, well equipped for further expansion Key figures 2019 2018 2019 MSEK Q4 Q4 Q3 Sales 3 774 3 557 4 244 EBITA, excl. non-recurring items 543 533 604 EBITA margin, excl. non-recurring items, % 14,4 15,0 14,2 Operating profit, excl.
Slide 17: Q4 2019 – Business areas
Q4 2019 – Business areas - Increased sales driven by acquisitions Net Sales Operating Profit Operating Margin, % 2019 2018 2019 2019 2018 2019 2019 2018 2019 MSEK Q4 Q4 Q3 Q4 Q4 Q3 Q4 Q4 Q3 HEXPOL 3 524 3 301 3 984 493* 486 547* 14,0* 14,7 13,7* Compounding HEXPOL Engineered 250 256 260 29 36 36 11,
Slide 18: Q4 2019 – HEXPOL Compounding
Q4 2019 – HEXPOL Compounding - Increased sales driven by acquisitions • Sales increased (incl. Preferred Compounding) 7% to 3,524 MSEK (3,301) – Higher volumes in Americas, but lower in Europe, while the volumes in Asia were stable – Adjusted for the acquired Preferred Compounding, volumes were lowe
Slide 19: Q4 2019 – HEXPOL Compounding
Q4 2019 – HEXPOL Compounding - Increased sales driven by acquisitions • HEXPOL Compounding Americas (incl. Preferred Compounding) – higher sales – Increased sales to automotive, building & construction, engineering & general industry – Excl. Preferred, sales were significantly lower to automotive an
Slide 20: Q4 2019 – HEXPOL Engineered Products
Q4 2019 – HEXPOL Engineered Products - Stable sales • Net sales were stable and amounted to 250 MSEK (256) – Sales were stable in HEXPOL Gaskets but decreased slightly in HEXPOL Wheels • Operating profit amounted to 29 MSEK (36) – Affected by continued delivery problems of an important raw material
Slide 21: Q4 2019 – Summary
Q4 2019 – Increased sales driven by acquisitions – Summary • Sales increased by 6% to 3,774 MSEK (3,557) • Operating profit, excl. non-recurring items, amounted to 522 MSEK (522) • Operating margin, excl. non-recurring items, amounted to 13.8% (14.7) • Operating cash flow increased to 732 MSEK (679)
Slide 22: Jan - Dec 2019 – Increased sales and significant strategic acquisitions
Jan - Dec 2019 – Increased sales and significant strategic acquisitions • Sales increased 13% • EBITA, excl. non-recurring items, increased 6% • Operating profit, excl. non-recurring items, increased 4% • Earnings per share, excl. non-recurring items, increased 3% • Operating cash flow increased 29%
Slide 23: Implications restructuring and integration
Implications restructuring and integration • Integration of Preferred Compounding and manage restructuring and cost synergies – according to plan • Restructuring of production capacity in HEXPOL Compounding Americas, amounted to approx.10 MUSD in Q4 • Costs in 2019 include closing of 2 production un
Slide 24: Q & A
& A @ HEXPOL January 30, 2020 A Material Difference 2 -24-
Slide 25: Thank You!
Thank You! January 30, 2020 - 25 -