Arkema Sa · EURONEXT:AKE
Arkema Sa — Q1 2023 Earnings Presentation
17 slides from Arkema Sa's earnings presentation, May 5, 2023
Slide 1: First-quarter 2023 results and outlook
First-quarter 2023 results and outlook 05/05/2023
Slide 2: Q1'23 financial highlights
Q1’23 financial highlights → Down 12.6% vs Q1’22 • Volumes down, impacted by continued weak demand in Europe, a slowdown observed in construction in the US and temporary destocking in batteries in China €2,524m sales • Overall resilience in prices, benefiting from the work to position the portfolio
Slide 3: Solid results against an exceptionally high comparison base
Solid results against an exceptionally high comparison base in €million Sales EBITDA Adj. Net Income Net Debt (incl. hybrid bonds) 2,887 619 2,389 2,366 376 2,524 2,226 358 367 159 162 Q1'21 Q1'22 Q1'23 Q1'21 Q1'22 Q1'23 Q1'21 Q1'22 Q1'23 31/12/22 31/03/23 Specialty Materials 91% Margin 14.5% Adj. E
Slide 4: New ambitious 1.5°C trajectory approved by SBTi (2030 targets)
New ambitious 1.5°C trajectory approved by SBTi (2030 targets) Scopes 1+2 Scope 3 GHG emissions (Mt CO2e) GHG emissions (Mt CO2e) -48.5% -54% 3.7 152 2.0 85 1.9 70 2019 Old New 2019* Old New 2030 2030 2030 2030 target target target target * Restated data, in line with SBTi recommendations First-quar
Slide 5: First-quarter 2023 highlights
First-quarter 2023 highlights Major biomethane Febex disposal supply agreement • Phosphorus derivatives • Long term agreement with mainly used in electronics ENGIE, 300 GWh/year of and pharmaceuticals biomethane in France • Sales ~ €30 million in 2021, • One of the largest private 59 employees, biom
Slide 6: First-quarter 2023 highlights (cont'd)
First-quarter 2023 highlights (cont’d) Commitment with UN Women Top Employer 2023 Among EU's top 100 innovators Arkema joined the Women’s Empowerment Certification renewed in 4 countries: In the top 10 of French companies in the Principles (WEPs) program with UN Women France, China, US, Brazil Europ
Slide 7: High return expansion projects to support our sustainable growth
High return expansion projects to support our sustainable growth Kynar® PVDF Pebax® +50% capacity elastomers in Changshu, CN +40% global capacity +50% capacity in Serquigny, FR in Pierre-Bénite, FR EBITDA contribution €50-70m H2’23 in 2023 (mainly H2) ~€180-200m at maturity Rilsan® Hydrofluoric Sart
Slide 8: Key figures
Key figures in €million Q1’23 Q1’22 Change Sales 2,524 2,887 -12.6% EBITDA 367 619 -40.7% Specialty Materials 347 556 -37.6% Intermediates 49 94 -47.9% Corporate -29 -31 EBITDA margin 14.5% 21.4% Specialty Materials 15.1% 21.3% Intermediates 22.5% 34.7% Recurring operating income (REBIT) 234 488 -52
Slide 9: Sales reflecting low volume environment and good pricing
Sales reflecting low volume environment and good pricing Sales in €million -18.3% +2.2% +2.7% +0.8% Ashland Performance Weak demand in Price increases of the Adhesives (closing on Europe, temporary last 12 months in the 28 Feb. 2022), destocking in face of cost inflation Permoseal and batteries in C
Slide 10: Adhesive Solutions (28% of Group sales)
Adhesive Solutions (28% of Group sales) Key figures Highlights in €m Q1’23 Q1’22 Change Sales 698 670 +4.2% → Prices up 6.7% YoY, in the general inflationary context, also supported by positive mix EBITDA 93 90 +3.3% EBITDA margin 13.3% 13.4% → Volumes down 12.7% YoY • Destocking and slowdown in con
Slide 11: Advanced Materials (37% of Group sales)
Advanced Materials (37% of Group sales) Key figures Highlights in €m Q1’23 Q1’22 Change Sales 937 1,075 -12.8% → Volumes significantly down 20.5% YoY • Demand remaining overall rather well oriented in EBITDA 160 274 -41.6% the US for the segment, but impacted by specific challenging EU context EBITD
Slide 12: Coating Solutions (26% of Group sales)
Coating Solutions (26% of Group sales) Key figures Highlights in €m Q1’23 Q1’22 Change → Volumes down 20.5% YoY Sales 661 862 -23.3% • Weaker overall demand, particularly in EU and in construction with ongoing destocking at certain EBITDA 94 192 -51.0% customers EBITDA margin 14.2% 22.3% • Strong fo
Slide 13: Intermediates (9% of Group sales)
Intermediates (9% of Group sales) Key figures Highlights in €m Q1’23 Q1’22 Change Sales 218 271 -19.6% → Volumes down 17.4% YoY EBITDA 49 94 -47.9% • Primarily reflecting subdued demand EBITDA margin 22.5% 34.7% for acrylics in China REBIT 36 79 -54.4% → Prices down 2.6% YoY • Continued positive dyn
Slide 14: Cash flow reflecting usual Q1 working capital seasonality
Cash flow reflecting usual Q1 working capital seasonality in €million Q1’23 Q1’22 EBITDA 367 619 → Q1’23 tax rate Current taxes -55 -101 21% of REBIT (excl. exceptional items) Cost of debt -16 -13 Change in working capital and fixed assets payables (1) -243 -411 → Working capital Recurring capital e
Slide 15: Net debt evolution (including hybrid bonds)
Net debt evolution (including hybrid bonds) in €million 1.3x LTM EBITDA 2,366 21 25 -30 5 2 2,389 31/12/2022 Rec. cash Exceptional M&A Dividends & FX and 31/03/2023 flow items Hybrid bonds others First-quarter 2023 results and outlook 05/05/2023 15
Slide 16: Outlook
Outlook → The macroeconomic context remains marked by a lack of visibility and continued low volumes. The outlook should be contrasted by region for the coming months, Europe remaining weak, the US down but holding up better overall and Asia improving slightly from a low level → Raw material costs a
Slide 17: Disclaimer
Disclaimer The information disclosed in this document may contain forward-looking statements with respect to the financial condition, results of operations, business and strategy of Arkema. In the current context, where the Covid-19 epidemic persists across the world, and where the consequences of t