Holcim Ltd · SIX:HOLN
Holcim — LafargeHolcim — Debt Investor Presentation (November 2020)
24 slides from Holcim's debt investor presentation, Nov 13, 2020
Slide 1: LafargeHolcim Sustainability Linked Bond Investor Presentation
LafargeHolcim Sustainability Linked Bond Investor Presentation 13 November 2020 GÉRALDINE PICAUD MAGALI ANDERSON CFO CSO
Slide 2: Introduction and Agenda
INTRODUCTION LAFARGEHOLCIM REPRESENTATIVES AGENDA Géraldine Picaud 01. Q3 Trading Update Chief Financial Officer 02. LafargeHolcim’s Sustainability Ambition 03. Sustainability-Linked Finance Framework and Bond Offering Magali Anderson Chief Sustainability Officer 2
Slide 3: Q3 Trading Update
01 Q3 Trading Update Géraldine Picaud, Chief Financial Officer 3
Slide 4: Recurring EBIT Margin Significantly Up
Q3 2020 KEY DEVELOPMENTS RECURRING EBIT MARGIN SIGNIFICANTLY UP Resilient demand, Net Sales decrease of 2.6% LFL Action plan “HEALTH, COST & CASH” delivering well ahead of targets Costs decline over-proportional compared to volumes in Q3, recurring EBIT margin up 250bps Recurring EBIT up by 10.0% LF
Slide 5: Health, Cost & Cash Action Plan
“HEALTH, COST & CASH” ACTION PLAN EXECUTION OF ACTION PLAN DELIVERING WELL AHEAD OF TARGETS HEALTH COST CASH Reduction in fixed costs by CHF Reduction of CAPEX by at least CHF Safeguard the Health and Safety of our staff, partners and communities 300million 1 400million In 2020 9M 2020 Compared to 2
Slide 6: Recurring EBIT Margin Expansion Across All Regions
Q3 2020 REGIONAL PERFORMANCE RECURRING EBIT MARGIN EXPANSION ACROSS ALL REGIONS 0.0% -9.1% 34.5% +3,6% -0.5% +14.6% -3.5% +35.8% +14.7% -2.2% +19.9% +5.4% 1’791 504 623 217 1’992 397 602 106 1’341 317 North America Latin America Europe Middle East Africa Asia Pacific 28.2% 34.5% 19.7% 17.3% 23.6% NE
Slide 7: Consistent Debt Deleveraging & Balanced Maturity Profile
FINANCIAL STRENGTH CONSISTENT DEBT DELEVERAGING & BALANCED MATURITY PROFILE NET LEVERAGE RATIO1 (Net Financial debt/Recurring EBITDA) CAPITAL MARKETS MATURITY PROFILE2 (CHF m, per 30.09.2020) 2,500 Capital Markets debt CHF million 2.4x 2.2x 2,000 1,500 1.4x 1,000 500 0 2017 2018 2019 2021 2022 2023
Slide 8: Credit Ratings Confirmed, Strong Balance Sheet & Liquidity
FINANCIAL STRENGTH CREDIT RATINGS CONFIRMED, STRONG BALANCE SHEET & LIQUIDITY STRONG LIQUIDITY STRONG BALANCE SHEET → More than CHF 8billion of cash and unused committed credit lines → Debt maturities 2020-2021 well covered with available liquidity → All credit lines without financial covenants and
Slide 9: Resilient Demand Expected, FCF Guidance Increased
OUTLOOK AND GUIDANCE 2020 RESILIENT DEMAND EXPECTED, FCF GUIDANCE INCREASED Resilient demand expected for Q4 20201 Execution of action plan “HEALTH, COST & CASH” to continue ahead of targets 2020 Free Cash Flow guidance increased to above CHF 2.75 bn based on strong Q3 performance Strong balance she
Slide 10: LafargeHolcim's Sustainability Ambition
02 LafargeHolcim’s Sustainability Ambition Magali Anderson, Chief Sustainability Officer 10
Slide 11: Our Four Sustainability Pillars
STRENGTHENING OUR LEADERSHIP IN SUSTAINABILITY OUR FOUR SUSTAINABILITY PILLARS CLIMATE CIRCULAR ENVIRONMENT COMMUNITY Sustainability & ENERGY ECONOMY pillars CO2 WASTE WATER VALUE Lead metric Reduced Re-used Saved Shared [kg CO2/t cementitious] [ Mt ] [ l fresh water / tcem ] [ M total beneficiaries
Slide 12: LafargeHolcim CO2 Footprint
STRENGTHENING OUR LEADERSHIP IN SUSTAINABILITY LAFARGEHOLCIM CO2 FOOTPRINT SCOPE 1 SCOPE 2 SCOPE 3 50% 26% 5% 1% 5% 13% Raw materials decarbonation Fuels combustion Cement production Cement production All indirect Energy generation emissions Aggregates and RMX operations 12
Slide 13: Leading in Sustainability Targets
STRENGTHENING OUR LEADERSHIP IN SUSTAINABILITY LEADING IN SUSTAINABILITY TARGETS 800 LafargeHolcim will reduce scope 1 CO2 emissions 700 to a target consistent with a net-zero pathway validated by SBTi* 610 *In line with keeping warming to well-below 2°C 2022 600 Target 576 561 2030 550 Target 500 4
Slide 14: Leading the Way in Green Construction
STRENGTHENING OUR LEADERSHIP IN SUSTAINABILITY LEADING THE WAY IN GREEN CONSTRUCTION Other actions taken to reduce our CO2 intensity: Clinker substitution Renewable energy Waste derived fuels and biomass Carbon capture Increased energy efficiency Green products Waste heat recovery Op
Slide 15: Partnerships Key to Scale Up Impact
STRENGTHENING OUR LEADERSHIP IN SUSTAINABILITY PARTNERSHIPS KEY TO SCALE UP IMPACT Partnering with SBTi: to lead in a rigorous, science- driven way 2030 approved targets Beyond 2030 developing roadmap in the cement sector 15
Slide 16: By 2030, LafargeHolcim Will
STRENGTHENING OUR LEADERSHIP IN SUSTAINABILITY BY 2030, LAFARGEHOLCIM WILL Accelerate use of low-carbon & carbon-neutral products, incl. ECOPact and Susteno Recycle 100m tons of waste and byproducts for energy and raw materials Scale up the use of calcined clay and develop novel cements with new bin
Slide 17: Sustainability-Linked Finance Framework and Bond Offering
03 Sustainability-Linked Finance Framework and Bond Offering 17
Slide 18: LafargeHolcim's Sustainability-Linked Financing Framework
LAFARGEHOLCIM’S SUSTAINABILITY-LINKED FINANCING FRAMEWORK COMMITTED TO SUSTAINABLE FINANCE COMMERCIAL PAPER PROGRAM SUSTAINABILITY LINKED BOND → EUR 3billion commercial paper program for issuance of → LafargeHolcim is taking the next step in its ESG notes established sustainable finance journey by e
Slide 19: Aligned with ICMA's Sustainability-Linked Bond Principles
LAFARGEHOLCIM’S SUSTAINABILITY-LINKED FINANCING FRAMEWORK ALIGNED WITH ICMA’S SUSTAINABILITY-LINKED BOND PRINCIPLES 1 SELECTION OF THE KPIs LafargeHolcim’s Sustainability Framework • KPI: CO2 intensity calculated as kg net CO2 emitted /t cementitious material (kg net CO2/t.cem), scope 1 is aligned w
Slide 20: KPI, SPT and Coupon Step-Up Mechanism
ENVISAGED BOND OFFERING KPI, SPT AND COUPON STEP-UP MECHANISM KPI Selection Coupon Step-up mechanism • Key Performance Indicator: • If SPT is not met, the coupon will increase via a one-time step-up ‒ CO2 intensity measured as kg net CO2 emitted /t cementitious of 75bp payable at maturity date (i.e.
Slide 21: Transaction Overview
TRANSACTION OVERVIEW Issue Senior Unsecured Notes Issuer Holcim Finance (Luxembourg) S.A. Guarantor LafargeHolcim Ltd Issuer & Guarantor rating Baa2 / BBB (Moody’s / S&P both stable) Expected issue ratings Baa2 / BBB (Moody’s / S&P) Status Senior unsecured Currency / Amount EUR Benchmark Tenor Long
Slide 22: Disclaimer
DISCLAIMER This presentation and any ancillary documents relating to it (any part of the same and any of it together, the "Presentation") was prepared by LafargeHolcim Ltd. exclusively for the purpose of introducing LafargeHolcim Ltd and its subsidiaries (together the “LafargeHolcim Group”) as backg
Slide 23: Disclaimer
DISCLAIMER This document cannot be retained and must be returned at the end of the Presentation. This presentation and all materials, documents and information used herein or distributed to investors in the context of this presentation do not constitute or form part of and should not be construed as
Slide 24: LafargeHolcim
Li LafargeHolcim
LafargeHolcim — Debt Investor Presentation (November 2020) on 6ix