Elopak Asa · OSL:ELO
Elopak Asa — Q3 2021 Earnings Presentation
27 slides from Elopak Asa's earnings presentation, Nov 4, 2021
Slide 1: Q3-21 Quarterly Results
Q3-21 Quarterly Results 4 TH NOV 2021 AMARCH Leading2021 Global Fresh Liquid Packaging Company and True Sustainability Champion March 2021
Slide 2: Disclaimer
Disclaimer Certain statements included in this announcement contain forward -looking information, including, without limitation, information relating to (a) forecasts, projections and estimates, (b) statements of Elopak management concerning plans, objectives and strategies, such as planned expansio
Slide 3: Packaging by Nature
Updated mission statement to be added when ready Packaging by Nature® ▹ As worldwide makers of carton-based packaging, we are committed to remain our customers’ partner and consumers’ favorite, through relentlessly developing new solutions for an expanding range of content ▹ Applying market-leading
Slide 4: Elopak statement on COP26
Elopak statement on COP26 ▹ The COP26 summit is now underway. It is a hugely important event with the potential to unite the world in tackling climate change. ▹ Elopak wholeheartedly supports the goals and ambitions of the summit, including the goal of reaching global net zero by 2050 and keeping 1.
Slide 5: Elopak at a Glance
Elopak at a Glance 11 A Leading Global Player in Fresh Liquid Carton Packaging 22 14 Billion Cartons Produced Across 9 Manufacturing Sites in 2020 3 Product Suite With More Than 400 SKUs 44 Sales to 70+ Markets With ~2,600 Employees 56 Established and Owned by Ferd Since 1957 Revenue (€m) Adj. EBITD
Slide 6: Q3-21 Business Performance
Q3-21 Business Performance CEO Thomas Körmendi
Slide 7: Q3 2021 Business Highlights
Q3 2021 Business Highlights: Continued solid financial performance while advancing strongly on growth strategy Continued strong Revenue growth of Continued solid profitability – 13 % compared to operational performance Adj. EBITDA of Q3-20 in all plants 32 mEUR in Q3-21 Naturepak Sustainability-driv
Slide 8: Revenues – Elopak Group
Revenues – Elopak Group Significant revenue growth compared to third quarter last year Revenues (EURm), CAGR (%) Key commentary mEUR 1% ▹ Revenue growth of 13% compared to third quarter 800 696 702 2020 700 ▹ Main drivers for the growth are: 600 500 – Increased revenue from filling machines 400 13%
Slide 9: Business update: EMEA
Business update: EMEA Solid Q3-21 performance, especially in Aseptic segments Revenues Q3-21 (EURm) – EMEA Key commentary ▹ Strong revenue performance in third quarter 2021 +1% mEUR ▹ The high QOQ growth is partly impacted by lower sales in 600 568 576 third quarter 2020 due to stock builddown with
Slide 10: Business update: Americas
Business update: Americas Quarterly revenue is up by 8% compared to Q3-20, and continued strong profitability performance Revenues Q3-21 (EURm) – Americas Key commentary mEUR -12% ▹ Revenue growth of 8 % compared to third quarter 160 152 2020 140 134 ▹ Attractive mix effects in cartons business 120
Slide 11: Elopak’s Profitable Growth Drivers
Elopak’s Profitable Growth Drivers Commercial Excellence Plastic to Carton 5 Broaden Conversion Geographic Footprint 4 Margin optimization Aseptic Growth 3 Purchasing and Fresh Opportunity Roadmap Imagine carton value engineering in North America 2 launch Growth on the back Operational Mid to Long T
Slide 12: Replacing Plastic with Cartons in the UK
Replacing Plastic with Cartons in the UK Freshways, UK’s largest independent milk processor, is going sustainable with Elopak Pure-Pak cartons ▹ Strong sustainability trends in the UK, to the benefit of cartons: 1) Consumers demanding more sustainable packaging 2) Growing evidence that carton has a
Slide 13: Naturepak acquisition
Naturepak acquisition Strategic acquisition in MENA announced on 12 th Oct-21 Acquisition of Naturepak, MENA region’s largest provider of fresh liquid cartons and packaging In line with Elopak’s strategy and strong strategic fit Acquisition is accretive to Elopak’s growth and margins, and is an exce
Slide 14: Saudi Arabia and Algeria are the largest MENA markets
Saudi Arabia and Algeria are the largest MENA markets MENA is expected to yield +3% CAGR in the coming years, in both Fresh and Aseptic segments Size of MENA milk and juice markets per country and product segment 2019, 100% = million litre 1,418 3,311 838 1,598 4,225 1,420 MENA Market growth ’20-25
Slide 15: Q3-21 Financial Performance
Q3-21 Financial Performance CFO Bent Kilsund Axelsen
Slide 16: Strong margins despite raw material headwind
Strong margins despite raw material headwind Adj. EBITDA (EURm), CAGR (%) and Adj. EBITDA margin (%) Key commentary Group EMEA ▹ Elopak prove to be a resilient business +1% during current turmoil in raw material 14.0% 13.4% 13.7% 14.1% -5% 85 87 markets +4% 28 27 ▹ Attractive mix effects both in ter
Slide 17: Adjusted EBITDA, third quarter 2021
Adjusted EBITDA, third quarter 2021 EBITDA growth in third quarter 2021 compared to 2021, is primarily due to revenue growth Quarterly Adjusted EBITDA (EURm) Key commentary ▹ Positive revenue impact, supported by mix effects 6,3 -6,6 -0,6 -0,2 31,7 ▹ Raw material prices remained high throughout 3,4
Slide 18: Financial position strengthened through IPO
Financial position strengthened through IPO Leverage Ratio for third quarter 2021 at 2.0x Leverage Ratio significantly improved Key commentary Net Debt ▹ Healthy financial position with a Leverage Ratio (mEUR) Leverage Ratio of 2.0x as of third 345 347 350 329 4,0 quarter 2021 311 318 300 255 3,5 ▹
Slide 19: Outlook
Outlook ▹ Revenues above 2020 levels, in line with mid-term guiding FY 2021 ▹ The sustained raw material headwind is expected to still impact Q4 figures ▹ Absolute EBITDA above 2020 levels, although margin slightly below last year ▹ Unchanged from the IPO prospectus published in June 2021 ▹ Over the
Slide 20: Summary
Summary ▹ Significant growth and strong profitability in third quarter ▹ Delivering on our strategic plan in Q3-21; – Americas growth QOQ – Aseptic growth YTD-21 – Acquisition in MENA growth markets (Naturepak) – Plastic to carton conversion in the UK and Nordics – Continued operational improvements
Slide 21: Q&A
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Slide 22: Appendix
Appendix
Slide 23: Financial calendar 2022
Financial calendar 2022 Event Date Q4 Financials February 23rd Annual report 2021 April 1st Q1 Financials May 5th Q2 Financials August 18th Q3 Financials October 26th 22
Slide 24: Elopak to Target Profitable Growth and a Robust Capital Structure
Elopak to Target Profitable Growth and a Robust Capital Structure Mid-term 3-5 years targets Revenue growth 2-3% organic growth p.a. and selectively pursue M&A opportunities EBITDA margin 14-15% adjusted EBITDA margin Capex EUR ~50m p.a. Dividend policy ~50-60% pay-out ratio % of adjusted net profit
Slide 25: Quarterly financials – Q1-20 to Q3-21
Quarterly financials – Q1-20 to Q3-21 % Adj.EBITDA EURm Quarterly Revenue, Adj.EBITDA and Adj.EBITDA margin (%) margin 300 20 253 242 250 233 237 223 18 210 213 200 16 150 14,7% 14,5% Revenue 14,0% 14,3% 13,4% 14 Adj. EBITDA 100 12,5% 12,3% Adj. EBITDA margin 50 37 35 12 29 29 27 32 32 0 10 Q1-20 Q2
Slide 26: Strong Development in Cash Conversion
Strong Development in Cash Conversion Driven by resilient Adj. EBITDA and delayed investments Simplified free cash flow and cash conversion1 Key commentary 89 88 • Continued strong cash 82 conversion due to resilient 72 adj. EBITDA and reduced capex 72,4% 70,0% 65,2% • Reduced capex due to lower 59,
Slide 27: Strong Balance Sheet with Moderate Leverage of 2.0x
Strong Balance Sheet with Moderate Leverage of 2.0x Q3-2021 LTM EBITDA Balance sheet overview Q3-2021 (EURm) Recognised net debt overview Q1- Q2- Q3- Dec-2020 771 771 (EURm) 2021 2021 2021 Bank debt 214 230 175 155 Overdraft facilities utilised 16 13 7 27 Equity 271 Cash and cash equivalents (6) (11