Navigator Company Sa · EURONEXT:NVG
Navigator Company Sa — The Navigator Company — H1 2022 Earnings Presentation
26 slides from Navigator Company Sa's earnings presentation, Jul 26, 2022
Slide 1: Q2 / H1 2022 Results Presentation
Q2 / H1 2022 Results Presentation July 26th 2022
Slide 2: Disclaimer
DISCLAIMER This presentation is intended to provide a general overview of The Navigator Company S.A.’s business and does not purport to deal with all aspects and details regarding The Navigator Company S.A.. This presentation has been prepared by The Navigator Company S.A. for information purposes o
Slide 3: Participation
PARTICIPATION << António Redondo Adriano Silveira Fernando Araújo Executive Directors João Lé João Paulo Oliveira Nuno Santos Investor Relations Ana Canha 2
Slide 4: Main Highlights
Q2 / H1 2022 RESULTS << PRESENTATION 01 02 03 Market & Main Group Outlook Highlights Performance 33
Slide 5: Q2 2022 | Record Results
Q2 2022 | RECORD RESULTS << ▪ Exceptional market conditions with: • Unprecedented high prices driven by global unbalance between demand and supply in pulp market; • UWF lower availability driven by significant capacity exits across Europe together with the strike in Northern Europe and lower importe
Slide 6: H1 2022 Financial Highlights
H1 2022 FINANCIAL HIGHLIGHTS << Continuous focus on operational efficiency and effective management of variable and fixed costs. EBITDA up by 130% to € 345 million (€ 150 million in H1 2021). H1 H1 Change Q2 Q1 Change In millions € 2022 2021 HoH 2022 2022 QoQ Turnover 1,142 715 +60% 650 492 +32% EBI
Slide 7: Main Quarter Highlights
MAIN QUARTER HIGHLIGHTS << Turnover, EBITDA and operating cash flow registered a record performance. Paper sales volume of 407 k tons (+25% QoQ). Operational Cash Turnover (M €) EBITDA (M €) Flow (M €) 223 151 650 476 492 93 83 341 374 405 96 109 122 70 79 71 80 54 Q1 Q2 Q3 Q4 Q1 Q2 Q1 Q2 Q3 Q4 Q1 Q
Slide 8: EBITDA YoY Analysis
EBITDA YoY Analysis << M€ Favorable price evolution across all businesses sustained by unique S/D conditions and efficiency performance outweighed rising costs in raw materials, energy and logistics +194 (+129%) 311 5 -30 26 8 345 -125 150 R21 Price Volume Logistics Costs FX Other R22 A B C Upward t
Slide 9: EBITDA QoQ Analysis (1/2)
EBITDA QoQ Analysis (1/2) << M€ Q2 2022 vs Q1 2022 Led by limited supply, rising Pulp & Paper market prices, as well as higher UWF sales volumes in the quarter offset persistent cost increases +101 (+83%) 16 23 223 82 5 -6 -18 122 R22 Q1 Price Volume Logistics Costs FX Other R22 Q2 A B C Price incre
Slide 10: EBITDA QoQ Analysis (2/2)
EBITDA QoQ Analysis (2/2) << M€ Q2 2022 vs Q2 2021 Price increases implemented during the last 12 months offset persistent rise in costs +143 (+179%) 198 6 -18 14 223 16 80 -74 R21 Q2 Price Volume Logistics Costs FX Other R22 Q2 A B C Superior prices across all UWF sales volumes growth (+12%) Genera
Slide 11: Market & Group Performance
Q2 / H1 2022 RESULTS << PRESENTATION 01 02 03 Market & Main Group Outlook Highlights Performance 10 10
Slide 12: Pulp & Paper Prices in 2022
PULP & PAPER PRICES IN 2022 << PRICES AT HISTORICAL LEVELS BHKP pulp price index in Europe currently at € 1,336/ ton and $ 1,362/ ton. A4 B-copy prices growing 28% since the beggining of the year to € 1,251 / ton. EUROPEAN MARKET PAPER PRICE – A4 B-COPY AND BHKP (IN €) 1400 1350 A4 B-copy BHKP 1300
Slide 13: Update on the Pulp Market
UPDATE ON THE PULP MARKET << • The quarter was marked by a sound price growth: PRICE • BHKP in Europe | 1,336 EUR/ton1 (+33% vs start of the year) • BHKP in China | 864 USD/ton1 (+50% vs start of the year) • H1 European BHKP average prices (EUR/ton) 47% higher YoY. • Global unbalance between supply
Slide 14: UWF Market Conditions
UWF MARKET CONDITIONS << • Index price for A4 paper at 1,251 EUR/ton1 (+28% vs start of the year). • Average prices along H1 2022 up to 1,117 EUR/ton compared with h1 2021 (814 EUR/ton). PRICE • Across the board price increases for Paper&Board throughout H1 in Europe, Americas, Africa and the Middle
Slide 15: Navigator Paper Performance
NAVIGATOR PAPER PERFORMANCE << ▪ Navigator achieved the strongest order book ever of around 90 days (+82% higher than competitors in June). ▪ Focus on increasing productivity output (+9% YoY) to better serve an under-supplied market. ▪ The Company managed to enrich its premium and mill brand shares
Slide 16: Tissue Business
TISSUE BUSINESS << Tissue business remains solid with sales from Finished Products growing 3% YoY. SALES1 H1 2022 (H1 2021) Geography Type Segment Finished 80% Consumer + 72% 47% Portugal Products (76%) Cash & Carry (73%) (46%) Reels 20% Away from Home 28% Spain 37% (24%) (27%) (37%) Extra Iberia 16
Slide 17: From Fossil to Forest
FROM FOSSIL TO FOREST << BAGS CORRUGATED BOARD FLEXIBLE PACKAGING (retail, food & filling industries, etc.) (packs, pouches, food take-away, envelopes, etc.) (agriculture, industry, retail, e-commerce, etc.) • Sales during the first half close to 2021 full year (€ 51 million) • The number of custome
Slide 18: Navigator and P2X Europe
NAVIGATOR AND P2X EUROPE << Subject to the approval of the anti-trust authorities, this unique joint venture, P2X-Portugal, will produce e-SAFs (e-Sustainable Aviation Fuels) – carbon-neutral synthetic kerosene, based on green hydrogen and biogenic CO2 The project will contribute to the development
Slide 19: Free Cash Flow
FREE CASH FLOW << −Strong cash flow generation of € 174 million, an increase of 43% YoY. −Working capital in line with trend of growing expansion in activity. -59 M€ (-25%) 234 -34 51 174 51 -68 53 -112 Operating CAPEX Inventories Clients State & Suppliers Other Free Cash Cash Flow Public Flow H1 En
Slide 20: Net Debt
NET DEBT << Net Debt amounted to € 521 million, a reduction of € 74 million vs year-end 2021. Net Debt/EBITDA ratio at a low historical level of 0.95x reflects the Group’s solid financial position. M€ 796 776 800 700 680 715 644 624 658 677 2.35 2.25 2.29 2.28 2.30 2.20 597 595 1.83 1.87 1.93 1.86 5
Slide 21: Maturity and Liquidity
MATURITY AND LIQUIDITY << Navigator issued € 150 million Sustainability-Linked Bond, maturing in 2028. This new bond increased the debt average maturity and reduced the Company's financing costs. With this operation, approximately 40% of total borrowing is issued on a sustainable basis. Debt maturit
Slide 22: A Bioindustry on the Right Side of the Future
A BIOINDUSTRY Recognitions ON THE RIGHT 3 81 SIDE OF THE PAPER & FORESTRY FUTURE | RATING* A- LEADERSHIP *NVG position in industry cluster | CLIMATE Achievements # From Fossil to Forest Global Climate Action Scopes 1 & 2 1.5ºC Scope 3 well bellow 2ºC Sustainable Finance ~ 40% of total borrowing issu
Slide 23: Takeaways
<< TAKEAWAYS • Strong quarter driven by tight market dynamics and successful price increases in pulp, paper, tissue and packaging; • Tight supply and market´s preference for Navigator products and brands kept high order books in the paper business; • Sales prices increase in all business areas more
Slide 24: Outlook
H1 / Q2 2022 RESULTS << PRESENTATION 01 02 03 Market & Main Group Outlook Highlights Performance 23 23
Slide 25: Outlook
OUTLOOK << H2 starts with historically high prices and European industry´s order books at high levels due to paper scarcity. Strong start though significant uncertainties for H2 2022. ▪ Uncertain macroeconomic and geopolitical environment; ▪ Strong inflationary pressure, rising interest rates and th
Slide 26: Q2 / H1 2022 Results Presentation
Q2 / H1 2022 Results Presentation July 26th 2022
The Navigator Company — H1 2022 Earnings Presentation on 6ix