Arkema Sa · EURONEXT:AKE
Arkema Sa — Investor Day (2015)
39 slides from Arkema Sa's investor day presentation, 2015
Slide 1: High Performance Materials
HIGH PERFORMANCE MATERIALS Bernard PINATEL Executive Vice-President High Performance Materials
Slide 2: 21st Century: The Advanced Materials Revolution
21ST CENTURY: THE ADVANCED MATERIALS REVOLUTION ADVANCED MATERIALS MUST... …DO MORE FUNCTIONAL Fire retardant, Sound dampening, Moisture barriers, Energy return, Vibration absorption, etc. …WITH LESS EFFICIENT Lightweight, Down gauging, Low energy, etc. …FOR ALL SUSTAINABLE Renewable, Recyclable, Af
Slide 3: Arkema, an Active Player of This Revolution
ARKEMA, AN ACTIVE PLAYER OF THIS REVOLUTION FUNCTIONAL WALL PLASTERS Pebax® Piezotech® WITH INSULATION PROPERTIES EFFICIENT Rilsan® CECA ADDITIVES Kynar® Aquatec LOWER FUEL CONSUMPTION FOR ENHANCED OIL RECOVERY SUSTAINABLE Rilsan®, Hiprolon® UV CURING RESINS PEELABLE FLOOR ADHESIVES BIO-SOURCED NO V
Slide 4: High Performance Materials at a Glance
HIGH PERFORMANCE MATERIALS AT A GLANCE 2014 KEY FIGURES* 2014 PROFORMA SALES BY BUSINESS UNIT** IN €M HPM (w/o Bostik) Bostik Sales 1,730 1,533 32% Bostik EBITDA 314 158 47% Technical Polymers EBITDA margin 18.2% 10.3% Performance Additives EBIT 213 117 21% Capex 112 37 KEY SUCCESS FACTORS 2014 SALE
Slide 5: Leading Positions in Three Main Platforms
LEADING POSITIONS IN THREE MAIN PLATFORMS… Worldwide BU / platform Main products Main end-markets position SPECIALTY DIY ADHESIVES Adhesives Construction #3 (BOSTIK) Industry Oil & Gas Specialty Automotive TECHNICAL POLYMERS polyamides Fluoropolymers Aeronautics #1 Industrial coatings Electronics Fi
Slide 6: Leveraging Strong Common Assets
…LEVERAGING STRONG COMMON ASSETS TECHNOLOGY INNOVATION-DRIVEN LEADERSHIP GROWTH From polymers design to formulation Solutions for megatrends: know-how energy efficiency, renewable, etc. High R&D intensity Materials with outstanding properties: temperature resistance, lightweight, etc. Strong patent
Slide 7: What We Have Achieved So Far
WHAT WE HAVE ACHIEVED SO FAR 2005 2005 – TODAY 2015-2020 A FULLY REPOSITIONED SEGMENT A higher quality portfolio: • Acquisition of Bostik in the resilient adhesives market • €0.5 bn sales of small non-core businesses divested A LOW STARTING POINT A better geographical balance: IN PROFITABILITY • Eur
Slide 8: Our Ambition
OUR AMBITION “A designer of materials and innovative solutions” SALES EBITDA MARGIN IN €BN IN % ~5 17 to 18% 14.5% 3.3 2014* LT 2014* LT (2020e) (2020e) * 2014 figures using new reporting and including Bostik 2014 sales 8 CAPITAL MARKETS DAY 2015
Slide 9: High Performance Materials Strategy
HIGH PERFORMANCE MATERIALS STRATEGY 4 STRATEGIC PRIORITIES Grow the adhesives Accelerate Capture growth Reinforce portfolio platform development opportunities with bolt-on in advanced in high growth acquisitions in materials countries advanced materials and adhesives It’s all about profitable growth
Slide 10: Bostik
BOSTIK
Slide 11: A Large and Growing Market
A LARGE AND GROWING MARKET 2014 market size: €50 bn* +3 to 3.5% CAGR expected over coming years NORTH AMERICA EUROPE ASIA AND ROW ~28% of global demand ~31% of global demand ~41% of global demand +2.5 to 3% CAGR +1.5 to 2% CAGR +4 to 5% CAGR with higher growth in Eastern Europe Source: Arkema intern
Slide 12: Adhesives: A Wide Range of Application Markets
ADHESIVES: A WIDE RANGE OF APPLICATION MARKETS INDUSTRY CONSTRUCTION CONSUMER 58% of global market 34% of global market 8% of global market General industry From basement to roof Do-it-yourself • Packaging • Floor underlayment • Stationery • Tapes and labels • Floor covering • Repair glues • Woodwor
Slide 13: An Attractive Market to Be In
AN ATTRACTIVE MARKET TO BE IN SPECIALIZED AND DIFFERENTIATED PRODUCTS KEY TO END-PRODUCT PERFORMANCE BUT ONLY A SMALL PORTION OF TOTAL PRODUCT COST STRONG BRAND LOYALTY FROM MECHANICAL FASTENING TO CHEMICAL BONDING FROM DRY MIX TO POLYMER-MODIFIED MORTARS INCREASING STANDARDS OF LIVING IN EMERGING C
Slide 14: Bostik at a Glance
BOSTIK AT A GLANCE 2014 KEY FIGURES PROFORMA 2014 SALES BY SEGMENT IN €M Sales 1,533 EBITDA 158 Industry EBITDA margin 10.3% 45% 55% Construction & Consumer EBIT 117 Capex 37 KEY ASSETS 2014 SALES BY REGION #3 worldwide 3 leading technology platforms 29% Growing pipeline of new and innovative Europe
Slide 15: Leading Positions in a Wide Range of End-Markets
LEADING POSITIONS IN A WIDE RANGE OF END-MARKETS NON-WOVEN CONSTRUCTION INDUSTRY CONSUMER BUSINESS MODEL Global Regional Local POSITION #2 worldwide #3 worldwide Top 3 in key countries #1 for specialties UNDERLYING Demographics Good balance of consumer Housing Repairs, MARKET DRIVERS and durable goo
Slide 16: Technological Leadership on 3 Platforms
TECHNOLOGICAL LEADERSHIP ON 3 PLATFORMS Elastic bonding OTHER TECHNOLOGIES Semi-structural reactive adhesives with high flexibility Able to withstand frequent levels of elongation, Acrylics contraction and energy-absorption Hot-Melt Pressure Sensitive Adhesives TOP 3 Silicone (PSA) TECHNOLOGIES Solv
Slide 17: Our Ambition for Bostik
OUR AMBITION FOR BOSTIK EBITDA EBITDA MID-TERM TARGET IN €M IN €M +30% ~300 158 158 x2 158 2014 2017e EBITDA MARGIN LONG-TERM TARGET IN % 14 to 15% 10.3% 2014 LT (2020e) 2014 2020e 17 CAPITAL MARKETS DAY 2015
Slide 18: Our Roadmap for Bostik
OUR ROADMAP FOR BOSTIK EBITDA IN €M 3 MAIN LEVERS ~300 1 Accelerate implementation of strategy: innovation through smart adhesive solutions Bostik® brand globalization emerging countries operational excellence 158 2 Synergies with Arkema short-term cost synergies acrylic-based adhesives (LT) structu
Slide 19: Innovation in Smart Adhesives Solutions
INNOVATION IN SMART ADHESIVES SOLUTIONS 1 Milwaukee (US) R&D INTENSITY (R&D / SALES) Thin core diapers IN % ~ 3% 2.7% 2.3% WW Center for Hot Melt PSA Fluff-less PSA core-bonding Opened in 2012 technology Compiegne (France) Reactive tapes and labels 2010 2014 2020e WW Center for Elastic Bonding Subst
Slide 20: Rationalize Portfolio of Brands
RATIONALIZE PORTFOLIO OF BRANDS 1 FROM 40 BRANDS… … TO 1 GLOBAL + 5 LOCAL BRANDS VISUAL IDENTITY ALIGNMENT BRAND AWARENESS BUILD-UP 20 CAPITAL MARKETS DAY 2015
Slide 21: Capture Growth in Emerging Countries
CAPTURE GROWTH IN EMERGING COUNTRIES 1 INDUSTRY CONSTRUCTION New production units to support Small production units close to customers our customer expansion Brazil (2012): acquisition of Fortaleza – South Korea + Thailand (2010) – new country new country – sales offices Brazil (2014) - 3rd site Vie
Slide 22: Improve Operational Excellence through Integrated Worldwide IT System
IMPROVE OPERATIONAL EXCELLENCE TROUGH INTEGRATED WORLDWIDE IT SYSTEM 1 % OF WORLDWIDE SALES UNDER SAP SAP Roll-out 2010-2015 100% SAP Roll-out 2016-2017 65% 35% 2013 2015e 2017e 22 CAPITAL MARKETS DAY 2015
Slide 23: A Full Benefit of Short-Mid Term Synergies by End 2017
A FULL BENEFIT OF SHORT-MID TERM SYNERGIES BY END 2017 2 IMPLEMENTATION HAS NOW STARTED WITH A STRONG MOBILIZATION 2015 2016 2017 Full benefit Closing of short-mid term 2 February synergies Synergies identification (including mid-long term ones) Short-mid term synergies: implementation and benefits
Slide 24: Long-Term Synergies: Opening Two New Promising Platforms
LONG-TERM SYNERGIES: OPENING TWO NEW PROMISING PLATFORMS 2 Acrylic-based Acrylic-based adhesives adhesives Second largest adhesives technology Fast growing water-based systems Upstream integration Elastic bonding Hot-Melt Pressure Sensitive LT expected Adhesives (PSA) % of sales Polymer-modified bin
Slide 25: Leverage a Unique Combination of Advanced Materials Player and Adhesive Formulator
LEVERAGE A UNIQUE COMBINATION OF AN ADVANCED MATERIALS PLAYER AND AN ADHESIVE FORMULATOR 2 SLIDE PRESENTED AT THE WORLD ADHESIVES CONFERENCE (19 SEPTEMBER 2012) 25 CAPITAL MARKETS DAY 2015
Slide 26: Bolt-on Acquisitions to Accelerate Growth
BOLT-ON ACQUISITIONS TO ACCELERATE GROWTH 3 Henkel 50% 45% Sika More than 100 companies 5% with sales < €100 m €50 bn Bostik H.B. Fuller Other large players with sales > €100 m A FRAGMENTED MARKET WITH NUMEROUS OPPORTUNITIES FOR CONSOLIDATION Source: Arkema internal estimates 26 CAPITAL MARKETS DAY
Slide 27: Advanced Materials
ADVANCED MATERIALS
Slide 28: Niche Markets in Advanced Materials: An Unlimited Field of Opportunities
NICHE MARKETS IN ADVANCED MATERIALS: AN UNLIMITED FIELD OF OPPORTUNITIES … WATER TREATMENT OIL AND GAS SPORTS BATTERIES AUTOMOTIVE COATINGS ELECTRONICS PHOTOVOLTAICS AERONAUTICS ADHESIVES ADHESIVES FOR CONSTRUCTION FOR INDUSTRY 28 CAPITAL MARKETS DAY 2015
Slide 29: Driven by Megatrends
…DRIVEN BY MEGATRENDS MEGATRENDS INDUCED MARKETS HIGH PERFORMANCE MATERIALS SOLUTIONS Lightweight materials in transport Rilsan® HT, composites (PEKK), (automotive, aeronautics, etc.) composite bonding ENERGY EFFICIENCY Electric vehicles Kynar® Thermal insulation in housing Kynar® Aquatec, CECA mole
Slide 30: A Unique Combination of Solutions for Flexible Pipes in Oil and Gas
A UNIQUE COMBINATION OF SOLUTIONS FOR FLEXIBLE PIPES IN THE OIL AND GAS 2 complementary solutions used depending on the characteristics of the oilfields Highly technological content: a performance more than a product Strong partnerships with customers Potential of PEKK solution in the longer term KY
Slide 31: Everywhere in Batteries
EVERYWHERE IN BATTERIES Expected annual growth >+10% TODAY SOLUTION: KYNAR® TOMORROW DEVELOPMENTS Kynar®: everywhere in the battery 2 new salts under development • as a binder to ensure the cohesion Main application: transport lithium of the active material and adhesion in lithium-ion batteries on t
Slide 32: Six Innovation Platforms
SIX INNOVATION PLATFORMS Material for energy (photovoltaic batteries) Materials Bio-based for electronics products Lightweight materials 3D printing Water treatment solutions 32 CAPITAL MARKETS DAY 2015
Slide 33: Lightweight Materials
LIGHTWEIGHT MATERIALS Expected annual growth >+7% VALUE CHAIN Resins Semi-Products Composites (PA, PVDF, PEKK, etc.) (prepregs, tapes) Glass or carbon fibres BENEFITS FROM THERMOPLASTIC COMPOSITES Higher productivity Mechanical performances Versatility of design Recyclability 33 CAPITAL MARKETS DAY
Slide 34: Targeted Markets
TARGETED MARKETS 34 CAPITAL MARKETS DAY 2015
Slide 35: A Wide Range of Solutions for Aeronautics
A WIDE RANGE OF SOLUTIONS FOR AERONAUTICS World fleet x1.5 over next 20 years Orgasol® the innovative Heat seal and attachment solution for toughening adhesives thermoset composites Mounting adhesives Altuglas® PMMA Skin to core composite adhesives transparent thermoplastics with high resistance Kyn
Slide 36: A Global Manufacturing Now Well in Place to Capture Growth
A GLOBAL MANUFACTURING NOW WELL IN PLACE TO CAPTURE GROWTH IN HIGH GROWTH COUNTRIES NORTH AMERICA EUROPE ASIA WHAT REMAINS TO BE DONE SPECIALTY Target 30% sales in emerging countries ADHESIVES (BOSTIK) KYNAR® PVDF SPECIALTY POLYAMIDES x2 capacities at Honfleur (Fr) FILTRATION to serve Asia and Middl
Slide 37: Siliporite, a New Growth Driver for Filtration and Adsorption (CECA)
SILIPORITE®, A NEW GROWTH DRIVER Expected FOR FILTRATION AND ADSORPTION (CECA) annual growth +6 to 7% THE LATEST GENERATION OF MOLECULAR SIEVES Siliporite® SPX 5003 for xylene separation in petrochemicals process A combination of unique properties: higher purity + higher yield + higher lifetime = HI
Slide 38: Well Positioned to Support Group's Long-Term Ambition
WELL POSITIONED TO SUPPORT GROUP’S LONG-TERM AMBITION Partnerships, Technology leadership + Innovation + Global footprint + customer intimacy High Performance Materials EBITDA margin potential 17 – 18% Arkema’s long-term ambition 38 CAPITAL MARKETS DAY 2015
Slide 39: 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