Heidelberg Materials Ag · XETR:HEI
Heidelberg Materials — HeidelbergCement — Investor Day (July 2014)
21 slides from Heidelberg Materials's investor day presentation, Jul 2, 2014
Slide 1: HeidelbergCement Capital Markets Day
HeidelbergCement Capital Markets Day 02 July 2014 / Cupertino, CA Update Financial Management Dr. Lorenz Näger, Member of the Managing Board and Chief Financial Officer Slide 1 - Capital Markets Day – 02 July 2014
Slide 2: Disclaimer
Disclaimer Unless otherwise indicated, the financial information provided herein has been prepared under International Financial Reporting Standards (IFRS). This presentation contains forward-looking statements and information. Forward-looking statements and information are statements that are not h
Slide 3: Key financials Q1 2014
Key financials Q1 2014 €m March Year to Date 2013 1) 2014 Variance Cons. Decons. Curr. L-f-L Volumes Cement (Mt) 15,896 17,479 10 % 0 -153 0 11% Aggregates (Mt) 39,846 44,330 11 % 1,142 0 0 8% Ready-Mix Concrete (Mm3) 6,933 7,707 11 % 21 -27 0 11% Asphalt (Mt) 1,192 1,528 28 % 163 0 0 15% Income sta
Slide 4: Financial key messages
Financial key messages Significant increase in profit for the period and earnings per share – Additional ordinary result improved to €m 11 (Q1 2013: €m -32) – Income taxes reduced to €m -2 (Q1 2013: €m -23) – Reduced minority share of profit to €m -39 (Q1 2013: €m -48) Financial discipline reite
Slide 5: Contents
Contents Page 1. Return on capital gaining traction at HC 6 2. ROIC remains our key financial steering logic 9 3. A short look at our financial policy 20 Slide 5 - Capital Markets Day – 02 July 2014
Slide 6: Successful reduction of asset base without destroying our strong reserve and earning position
Successful reduction of asset base without destroying our strong reserve and earning position OIBD (LTM) as % of segment assets* (Q1 2014) 35% Low CapEx 30% Disciplined working capital management Disposal of idle assets 25% 20% 15% Ø= 12% 10% 5% 2012 0% Africa / Asia – Eastern Europe / Western
Slide 7: Improvement of operational efficiency and disciplined management of asset base
Improvement of operational efficiency and disciplined management of asset base OIBD (LTM) as % of segment assets* (Q1 2014) Asset in €m* 15.0 14.7% 22,500 11.8% 12.0% 22,145 11.4% 22,000 11.5 21,837 11.0 10.5% 10.4% 10.3% 21,500 10.5 10.0 21,000 9.5 9.0 20,553 20,289 20,500 8.5 21,708 20,086 8.0 20,
Slide 8: Contents
Contents Page 1. Return on capital gaining traction at HC 6 2. ROIC remains our key financial steering logic 9 3. A short look at our financial policy 20 Slide 8 - Capital Markets Day – 02 July 2014
Slide 9: Improving ROIC by continuous improvement of operational efficiency and active management of asset base
Improving ROIC by continuous improvement of operational efficiency and active management of asset base EBIT ( 1 ) - Income Taxes Paid ( 2 ) HC definition ROIC = Equity + Net Debt ( 3 , 4 ) 1 Continuous improvement of operational efficiency Accelerated progress in business optimization programs, e.g.
Slide 10: Integrated Supply Chain Management (LEO) on track
1 Integrated Supply Chain Management (LEO) on track Integrated IT and SCM Successful implementation of a state-of-the- approach for all business lines art tool for the whole supply chain in Poland Centralized customer service and Reporting order intake for all business lines Finance CEM Sales Main
Slide 11: Successful implementation of a state-of-the-art tool to support the whole supply chain in Poland
1 Successful implementation of a state-of-the-art tool to support all elements of the whole supply chain in Poland Operational efficiency: Added value for customer: Efficient stock management etc. Efficient intake process etc. Automated Centralized replenishment order intake Added value for customer
Slide 12: Tax management remains an important part of return improvement
2 Tax management remains an important part of return improvement Cash tax ratio [%] HeidelbergCement 60 3 year average 55 50 45 40 35 30 25 20 15 10 5 0 2006 2007 2008 2009 2010 2011 2012 2013 mid-cycle Recovery in US and UK will allow us to make use of existing tax losses carried forward Slide 12 -
Slide 13: Usage of existing tax losses carried forward in the US and UK is expected to improve cash tax ratio
2 Usage of existing tax losses carried forward in the US and UK is expected to improve our cash tax ratio in 2014 US / UK US / UK * Indonesia* Strong recovery in the US and ∆ OIBD 100 100 UK continues in 2014 No current tax payment due to - Current tax 0 - 25 high tax losses carried forward ~
Slide 14: Disposal projects on track
3 Disposal projects on track Disposal of Building Products Other disposal projects Geographical Presence Disposal of cement plant in Raigad / India – Process completed in January 2014 Disposal of loss-making Gabon plant US Canada UK – Process completed in March 2014 (East) Disposal of non-core
Slide 15: Disposal of Building Products in North America and UK
3 Disposal of Building Products in North America and UK Nomination of Investment Banks Completed Preparation of carve-out financial Completed statements Disposal of Audit of carve-out financial statements On track – to be finished in July Building Products No detailed announcement in quiet period as
Slide 16: Balanced use of cash for growth expenditure, dividends and net debt reduction
4 Balanced use of cash for growth expenditure, dividends and net debt reduction Usage of free cash flow (1) [€m] 1,170 • Increase in dividends; medium-term increase in 925 payout ratio to 30% - 35% 849 (2) 625 710 497 159 • Continue to grow in 328 attractive markets at 511 efficient CapEx values FCF
Slide 17: Moderate increase in dividend in line with developments in the past
4 Moderate increase in dividend in line with developments in the past Dividend / share Target area: in € payout ratio of 30% to 35% +28% 0.60 0.6 0.5 0.47 0.4 0.35 0.3 0.25 0.2 0.12 0.1 0.0 2009 2010 2011 2012 2013 mid-cycle target HC is gradually approaching its medium-term goal of a payout ratio o
Slide 18: Confident to reach the mid-cycle targets and deliver a solid return on capital
Driven by strong recovery in Europe and NAM, we are confident to reach the mid-cycle targets and deliver a solid return on capital [ROIC in %] 1 Operational 9 efficiency Target area 8 2 7 7.5 6.2 6.3 Efficient tax 6 5.6 management 5.0 5 4.4 3 4 3.3 Asset base 3 improvement 2 4 1 Balanced 0 use of ca
Slide 19: Contents
Contents Page 1. Return on capital gaining traction at HC 6 2. ROIC remains our key financial steering logic 9 3. A short look at our financial policy 20 Slide 19 - Capital Markets Day – 02 July 2014
Slide 20: Financial Policy & Liquidity
Financial Policy & Liquidity 1 Continuation of conservative financial policies – Continuous focus on deleveraging – Remaining free cash flow is used for growth in attractive markets and moderate increase in dividend 2 Adequate back-up liquidity at all times to cover the liquidity needs of the co
Slide 21: for better building
AEIDELBERGCEMENT for better building IEIDELBERGCEMENT