Andritz Ag · VIE:ANDR
Andritz — H1 2020 Earnings Presentation
25 slides from Andritz's earnings presentation, Jul 31, 2020
Slide 1: Results for Q2 / H1 2020
RESULTS FOR Q2 / H1 2020 ANDRITZ GROUP JULY 31, 2020
Slide 2: Chapter Overview
CHAPTER OVERVIEW 01 Q2 2020 AT A GLANCE 02 PERFORMANCE Q2 2020 03 UPDATE OF BUSINESS AREAS 04 2 / ANDRITZ / RESULTS OF THE ANDRITZ GROUP FOR H1 2020 / JULY 31, 2020 / © ANDRITZ GROUP
Slide 3: Q2 2020 at a Glance
Q2 2020 AT A GLANCE Order intake heavily impacted by Corona crisis, successful short-term cost containment • Group order intake, at 1.2 billion euros, significantly down as a result of the global economic downturn triggered by the Covid-19 pandemic • Satisfactory development of Pulp & Paper boom i
Slide 4: Chapter Overview
CHAPTER OVERVIEW 01 Q2 2020 AT A GLANCE 02 PERFORMANCE Q2 2020 03 UPDATE OF BUSINESS AREAS 04 4 / ANDRITZ / RESULTS OF THE ANDRITZ GROUP FOR H1 2020 / JULY 31, 2020 / © ANDRITZ GROUP
Slide 5: Significant Decrease of Order Intake in Q2 2020
SIGNIFICANT DECREASE OF ORDER INTAKE IN Q2 2020 Pulp & Paper, Metals and Hydro substantially down; Separation slightly up y/y ORDER INTAKE Q2 2020 (IN MEUR) ORDER INTAKE BY BUSINESS AREA (IN MEUR) ORDER INTAKE H1 2020 (IN MEUR) Q2 2020 Q2 2019 +/- Includes larger Pulp & Paper 622 1,119 -44% orders i
Slide 6: Quarterly Development of Order Intake
QUARTERLY DEVELOPMENT OF ORDER INTAKE Order intake of last 4 quarters amounted to ~6.6 bn euros ORDER INTAKE BY REGION MEUR MEUR H1 2020 (H1 2019) IN % 2,500 10,000 1,908 2,047 2,094 2,000 1,737 1,853 8,000 Emerging Markets: 1,658 1,470 1,532 1,560 1,341 1,467 1,533 1,469 1,483 54% (46%) 3% 1,500 1,
Slide 7: Group Sales Slightly Up, Mainly Driven by Capital Business
GROUP SALES SLIGHTLY UP, MAINLY DRIVEN BY CAPITAL BUSINESS Very favorable development in Pulp & Paper; Hydro, Metals, and Separation down q/q SALES Q2 2020 (IN MEUR) SALES BY BUSINESS AREA (IN MEUR) SALES H1 2020 (IN MEUR) Q2 2020 Q2 2019 +/- Pulp & Paper 882 708 +25% +4% Metals 343 371 -8% (100% or
Slide 8: Service Business Only Partially Impacted by Covid-19
SERVICE BUSINESS ONLY PARTIALLY IMPACTED BY COVID-19 Quarterly development of service sales (in MEUR) -10% 800 757 2,800 702 671 700 651 2,600 560 594 587 576 585 600 514 511 482 2,400 437 465 468 465 469 500 428 2,200 400 2,000 300 1,800 200 100 1,600 0 1,400 Q1 16 Q2 16 Q3 16 Q4 16 Q1 17 Q2 17 Q3
Slide 9: Service Business by Business Area
SERVICE BUSINESS BY BUSINESS AREA % of total business area sales PULP & PAPER METALS 48 51 41 42 38 41 37 24 23 27 23 23 20 22 2015 2016 2017 2018 2019 Q2 2020 H1 2020 2015 2016 2017 2018 2019 Q2 2020 H1 2020 HYDRO SEPARATION 52 52 44 46 47 45 45 29 32 33 33 25 26 28 2015 2016 2017 2018 2019 Q2 2020
Slide 10: Solid Order Backlog – Especially in Pulp & Paper
SOLID ORDER BACKLOG – ESPECIALLY IN PULP & PAPER Order backlog at 7.4 billion as of end of Q2 2020 ORDER BACKLOG (AS OF END OF PERIOD; IN MEUR) -4% ORDER BACKLOG AS OF END OF Q2 2020 BY BUSINESS AREA 8,121 7,778 7,925 (IN %) 7,724 7,148 7,076 7,044 7,261 7,397 6,789 6,974 6,849 6,651 6,553 6,841 6,8
Slide 11: Earnings and Profitability Up Due to Pulp & Paper and Separation
EARNINGS AND PROFITABILITY UP DUE TO PULP & PAPER AND SEPARATION Successful short-term cost containment measures EBITA (IN MEUR) AND EBITA MARGIN Q2 2020 (IN %) EBITA (IN MEUR) AND EBITA MARGIN H1 2020 (IN %) Q2 2020: -2% • Unchanged solid earnings and profitability of 177.5 174.3 Pulp & Paper with
Slide 12: Profitability by Business Area
PROFITABILITY BY BUSINESS AREA EBITA margin (%) PULP & PAPER METALS HYDRO SEPARATION 10.0 9.6 9.4 9.4 9.2 8.4 7.2 6.9 6.5 6.5 5.8 5.4 5.3 4.1 3.2 FY 2019 Q2 2019 Q2 2020 H1 2019 H1 2020 FY 2019 Q2 2019 Q2 2020 H1 2019 H1 2020 FY 2019 Q2 2019 Q2 2020 H1 2019 H1 2020 -0.6 -0.9 -2.1 -2.3 -4.5 FY 2019 Q
Slide 13: EBITDA – Net Income Bridge
EBITDA – NET INCOME BRIDGE Financial result improved compared to H1 2019 mainly due to lower interest expenses resulting from redemption of a corporate bond in July 2019 (volume: 350 MEUR) Metals Tax rate: ~30% 8.2%* 5.5% 4.3% 3.8% 2.6% IN MEUR; *: % OF TOTAL SALES 13 / ANDRITZ / RESULTS OF THE ANDR
Slide 14: Development of Cash Flow from Operating Activities
DEVELOPMENT OF CASH FLOW FROM OPERATING ACTIVITIES Decrease in net working capital • ~116 MEUR decrease in contract liabilities (-) (3.2)* (244.6)* • ~95 MEUR increase in contract assets (-) (-18.3)* • ~94 MEUR decrease in trade receivables (+) Split of total depreciation: • ~63 MEUR increase in inv
Slide 15: Solid Financial Position
SOLID FINANCIAL POSITION Liquid funds of 1.5 billion euros Acquisition of Xerium IN MEUR (~833 MUSD), including net financial Mainly acquisition of liabilities of approximately 590 MUSD Schuler (~600 MEUR) (mainly redemption of bond) 2,350 2,048 1,815 1,772 1,850 1,702 1,595 1,610 1,517 1,507 1,531
Slide 16: Chapter Overview
CHAPTER OVERVIEW 01 Q2 2020 AT A GLANCE 02 03 UPDATE OF BUSINESS AREAS 04 16 / ANDRITZ / RESULTS OF THE ANDRITZ GROUP FOR H1 2020 / JULY 31, 2020 / © ANDRITZ GROUP
Slide 17: Pulp & Paper: Strong Increase in Sales and Continued Favorable Profitability
PULP & PAPER: STRONG INCREASE IN SALES AND CONTINUED FAVORABLE PROFITABILITY Solid development in Capital and Service Order intake in Q2 2020 down compared to Q2 2019 UNIT Q2 2020 Q2 2019 +/- H1 2020 H1 2019 +/- 2019 which included some larger orders for supply of Order intake MEUR 621.6 1,118.8 -44
Slide 18: Metals: Unsatisfactory Business Development
METALS: UNSATISFACTORY BUSINESS DEVELOPMENT Significant decline in order intake as a result of the global economic downturn and structural market weakness (Schuler) UNIT Q2 2020 Q2 2019 +/- H1 2020 H1 2019 +/- 2019 Order intake in Q2 2020 Order intake MEUR 126.6 461.7 -72.6% 488.1 809.8 -39.7% 1,582
Slide 19: Hydro: Continued Weak Global Hydropower Market
HYDRO: CONTINUED WEAK GLOBAL HYDROPOWER MARKET Low order intake, profitability down due to processing of low-margin orders and under-absorption Order intake at low level UNIT Q2 2020 Q2 2019 +/- H1 2020 H1 2019 +/- 2019 due to unchanged low Order intake MEUR 246.9 287.9 -14.2% 492.4 601.8 -18.2% 1,3
Slide 20: Separation: Further Improvement in Profitability
SEPARATION: FURTHER IMPROVEMENT IN PROFITABILITY Good development of order intake for solid-liquid separation equipment Order intake slightly higher than in Q2 2019, driven by UNIT Q2 2020 Q2 2019 +/- H1 2020 H1 2019 +/- 2019 solid-liquid separation Order intake MEUR 188.7 178.7 +5.6% 356.4 367.9 -3
Slide 21: Chapter Overview
CHAPTER OVERVIEW 01 Q2 2020 AT A GLANCE 02 03 04 21 / ANDRITZ / RESULTS OF THE ANDRITZ GROUP FOR H1 2020 / JULY 31, 2020 / © ANDRITZ GROUP
Slide 22: Market Update and Outlook by Business Area (I)
MARKET UPDATE AND OUTLOOK BY BUSINESS AREA (I) Satisfactory market environment for Pulp and Paper, very weak in Metals PULP & PAPER • Strong decline of pulp prices, now bottoming out at low levels; increase in global inventories due to demand going back to „normal“ (after high demand during initial
Slide 23: Market Update and Outlook by Business Area (II)
MARKET UPDATE AND OUTLOOK BY BUSINESS AREA (II) Unchanged challenging market environment for hydropower equipment, Separation good HYDRO • Unchanged challenging market environment globally • Sharp decline of electricity spot prices in Europe during first half 2020 • Weak demand for small hydropower
Slide 24: Outlook: Financial Guidance for 2020
OUTLOOK: FINANCIAL GUIDANCE FOR 2020 ANDRITZ topics for the remainder of 2020: • Implementation of restructuring measures in Metals Forming and Hydro to cope with structural market weaknesses (intensified by global economic downturn): • Adjust cost base in both areas to expected lower mid-term busin
Slide 25: Disclaimer
DISCLAIMER This presentation contains valuable, proprietary property belonging to ANDRITZ AG or its affiliates (“the ANDRITZ GROUP”), an d no licenses or other intellectual property rights are granted herein, nor shall the contents of this presentation form part of any sales contracts that may be co