Viscofan, S.a. · BME:VIS
Viscofan — FY2020 Earnings Presentation
42 slides from Viscofan's earnings presentation, Feb 25, 2021
Slide 1: January-December 2020 results
January-December 2020 25 February 2021 January – December 2020 results 1
Slide 2: Main challenges and implemented projects; 2020 results; Initiatives and 2021 outlook
1 Main challenges and implemented projects 2 2020 results 3 Initiatives and 2021 outlook January – December 2020 results 2
Slide 3: Appendix. Disclaimer
Appendix. Disclaimer This document may include statements This circumstance must be taken into account about intentions, expectations or forecasts mainly for all persons or entities that may have to of the Company additional to the take decision, develop or spread opinions relative mandatory financi
Slide 4: Main challenges and projects
1 Main challenges and projects 2 2020 results 3 Planned Initiatives and 2021 outlook January – December 2020 results 4
Slide 5: Thanks to all the Viscofan team…
Thanks to all the Viscofan team… January – December 2020 results 5
Slide 6: Management priorities during the COVID-19 pandemic
Management priorities during the COVID-19 pandemic Guarantee the safety and well-being of out workers Protection protocols, including sanitation measures, social distance, mandatory use of face masks, higher cleaning and disinfection works, teleworking and increased communication. Ensure supply to c
Slide 7: Improving the leadership thanks to a unique proposition in the industry
Improving the leadership thanks to a unique proposition in the industry Global footprint & Customer proximity 22 production plants in 14 countries Sales in more than 100 countries Broad and diversified product portfolio The only one with the 4 main technologies More than 14,000 references sold in 20
Slide 8: MORE TO BE. Meeting objectives
MORE TO BE. Meeting objectives REPORTED FIGURES vs. GUIDANCE (€ million) Revenue EBITDA Net profit 921 912.2 903 234 234.4 849.7 220 115 122.5 215 112 201.0 105.6 2019 2020 2019 2020 2019 2020 US$/€ = 1.14 vs. 1.13 BRL/€ = 5.89 vs. 4.50 January – December 2020 results 8
Slide 9: MORE TO BE. Increasing shareholder remuneration
MORE TO BE. Increasing shareholder remuneration ORDINARY REMUNERATION PER SHARE (€) +25.9% 2020 vs. 2015 Protection against market volatility +4.9% 1.70 1.62 1.60 1.40 €/share paid on 22 1.55 December 2020 0.29 €/share to be paid 1.45 out on 3 June 2021 0.01 €/share. AGM 1.35 attendance premiu
Slide 10: 2020 results
1 Main challenges and implemented projects 2 2020 results 3 Initiatives and 2021 outlook January – December 2020 results 10
Slide 11: All-time high in revenue driven by volume growth, price/mix and Nitta contribution
All-time high in revenue driven by volume growth, price/mix and Nitta contribution against forex headwind REVENUE 2020FY. Growth contribution (€ million) +7.4% 2020 vs. 2019 +29.8MN -37.9MN +78.7MN -8.1MN 912.2 849.7 +9.3 p.p. -1.0 p.p. +3.5 p.p. -4.4 p.p. Like-for-like 1 Like-for-like 1 Change in t
Slide 12: Growth in all reporting areas
Growth in all reporting areas REVENUE 2020FY. Breakdown by geographical area1 (€ million) +7.4% +8.3% GROUP vs. 2019 Like-for-like2 55.2% 30.6% EUROPE AND NORTH LATAM ASICA PACIFIC AMERICA 14.2% +4.8% +5.7% +15.0% +4.9% +2.3% +24.8% vs. 2019 Like-for-like2 vs. 2019 Like-for-like2 vs. 2019 Like-for-l
Slide 13: Acceleration in China, Rest of Asia and North America in the fourth quarter
Acceleration in China, Rest of Asia and North America in the fourth quarter REVENUE 4Q20. Breakdown by geographical area1 (€ million) +7.3% +11.3% GROUP vs. 4Q19 Like-for-like2 58.7% 28.4% EUROPE AND NORTH LATAM ASICA PACIFIC AMERICA 13.0% +7.9% +9.6% +11.5% +8.0% -2.9% +24.2% vs. 4Q19 Like-for-like
Slide 14: Commercial discipline, volume acceleration driven by China, rest of Asia and North America
Commercial discipline, volume acceleration driven by China, the rest of Asia and North America in a quarter with forex weakness REVENUE. Quarterly growth contribution 4Q20 +7.3% +11.3% vs. 4Q19 Like-for-like1 +12.8p.p. +9.1p.p. +7.0 p.p. +7.9p.p. +3.6p.p. +3.1p.p.+4.4p.p. +3.0p.p. +0.2 p.p. -1.0p.p.
Slide 15: Casings sales growth leads to new all-time high in quarterly revenue
Casings sales growth leads to a new all-time high in quarterly revenue despite the decline in co-generation revenue REVENUE. Viscofan Group (€ million) CASINGS SALES (€ million) 240.3 231.6 215.7 216.3 211.7 211.9 222.1 224.9 224.9 223.9 204.4 215.9 197.0 191.2 208.6 201.2 + 9.3% vs. 4Q19 1Q 2Q 3Q 4
Slide 16: Operating results boosted by revenue growth, efficiencies and savings
Operating results are boosted by revenue growth, high capacity utilization, efficiencies and savings arising from the new technology P&L 2020. Year-on-year change +27.7% Savings and production +3.7% excluding +25.0% efficiencies acquired companies Decline in the auxiliary raw materials cost
Slide 17: Double-digit growth in EBITDA despite forex headwind
Double-digit growth in EBITDA despite forex headwind EBITDA 2020. Growth contribution (€ million) +16.7% 2020 vs. 2019 +54.9MN +0.0MN -18.5 MN 234.4 -2.9MN 201.0 Non-recurring 198.0 +27.7 p.p. +0.0 p.p. -9.3 p.p. Change in the Like-for-like 2 Forex scope of consolidation +18.4% 2019 2019 2020 report
Slide 18: Commercial discipline, improved price mix and higher volumes offset forex erosion
Commercial discipline, improved price mix and higher volumes with market share gain allow to offset the strong forex erosion Recurring1 EBITDA. Quarterly growth contribution 4Q20 +24.7% recurring vs. 4Q19 +38.1p.p. +31.9p.p. +26.7 p.p. +12.2 p.p. +0.5p.p. +0.4p.p. +0.6p.p. -0.3p.p. -0.4p.p. -7.9p.p.
Slide 19: Improving the profitability of our operations
Improving the profitability of our operations RECURRING1 EBITDA MARGIN (In %) +2.4p.p. +4.2p.p. +3.7p.p. +5.6p.p. vs. 2019 Like-for-like 2 2020 Like-for-like 2 vs. 4Q19 Like-for-like 2 2020 2019 29.2% 29.1% 27.5% 27.5 % 27.2% 26.1% 25.7% 25.9% 23.8% 23.3% 23.4% 23.5% 23.5% 23.4% 22.8% 2019 2020 2020
Slide 20: Double-digit growth in Net Profit
Double-digit growth in Net Profit with higher negative exchange differences and effective tax rate EBIT to NET PROFIT. REPORTED (€ million) Financial result. Mn€ 2020 2019 2.7 1.5 € million 2020 2019 % y-o-y 0.6 -0.4 -0.3 -0.5 -1.9 Reported EBIT 162.9 130.3 +25.0% -5.1 1Q 2Q 3Q 4Q Financial result -
Slide 21: Good progress in investment despite difficulties in project execution
Good progress in investment despite difficulties in project execution due to the restriction of movements caused by the COVID-19 pandemic CAPEX 2016-2020. Breakdown by type (€ million) 107.2 Increase in fibrous capacity in Cáseda New co-generation engines that are 86.7 more sustainable Collage
Slide 22: Solid cash generation strengthening the balance sheet
Solid cash generation that allows to continue strengthening the balance sheet while the remuneration to shareholders grows. 89.4 NET BANK1 AND NET FINANCIAL DEBT bridge (€ million) +44.2 82.4 42.5 -234.4 +109.4 +2.7 38.2 Forex IFRS 16 and and others Net bank others Net bank debt1 Net Net debt1 Dec’1
Slide 23: Initiatives and 2021 outlook
1 Main challenges and implemented projects 2 2020 results 3 Initiatives and 2021 outlook January – December 2020 results 23
Slide 24: The MORE TO BE strategy period is extended due to COVID environment
Entorno The de pandemia MORE TO BEaconseja strategy ampliar period isMORE TO BE extended due to COVID environment Risks contagion Changes in Continuity of demand successful projects • Transportation and • Change in eating habits. • Searching leadership in all mobility restrictions More consumption a
Slide 25: … in a market that has demonstrated great strength in 2020
… in a market that has demonstrated great strength in 2020 Population Feeding habits Technology sophistication Household External consumption consumption Customized Asegurar el suministro +4% casings growth in Productivity Safety Availability New products a los clientes 2020 January – December 2020
Slide 26: Emerging areas. Growth potential
Emerging areas. Growth potential +6% volume 2020 vs. 2019 Africa 4% +4% Africa 17% volume Africa 1% Latam 12% 2020 vs. 2019 Latam 11% Latam 7% 24% Asia Pacific 48% 60% Asia Asia Pacific Pacific Population Customized casings Poultry and pig meat (FAO) market in 2020. In € consumption. Tns (FAO) (inte
Slide 27: Emerging areas. Growth potential
Emerging areas. Growth potential Markets to be Developments in Animal protein developed vegetable food Urban population consumption Animal gut (launch of vegetable (India, Africa, (+2% annual) (+2% annual) substitution sausages) cellulose in China) January – December 2020 results 27
Slide 28: Emerging areas. Viscofan is placed to capture the growth
Emerging areas. Viscofan is placed to capture the growth Unique position in Unique position in Leader in Spreading Leader in emerging areas emerging areas collagen. commercial cellulose. Natur casing. presence Veggie casing Markets to be Developments in Animal protein developed vegetable f
Slide 29: Emerging areas. Viscofan is placed to capture the growth
Emerging areas. Viscofan is placed to capture the growth VISCOFAN. CASINGS REVENUE IN EMERGING AREAS. Base 100 year 2015 +3% CAGR 2015- 2020 Organic 115 Unique positioning and 110 technological variety to take 100 101 95 98 advantage of growth opportunities 2015 2016 2017 2018 2019 2020 January – De
Slide 30: Developed Areas. An increasingly demanding market
Developed Areas. An increasingly demanding market +4% volume 2020 vs. 2019 6% North 16% America North 31% Europe 10% America North America 20% Europe +2% volume 2020 vs. 2019 Europe 33% Population Customized casings Poultry and pig meat (FAO) market in 2020. In € consumption. Tns (FAO) (internal) Ja
Slide 31: Developed Areas. An increasingly demanding market
Developed Areas. An increasingly demanding market Sustainability Taylor-made product Bio product, circular Higher yields and Convenience Proximity Variety, new flavors, economy, automatization Technical sale aromas decarbonization Snacking January – December 2020 results 31
Slide 32: Developed areas. Viscofan is positioned to grow
Developed areas. Viscofan is positioned to grow Marathon Line Global footprint, More than 14,600 > 84% of revenue Collagen casings, Natur commercial and references. from natural, beefstick casing technical Vispice biodegradable or assistance team recycled material casings Sustainability Ta
Slide 33: Developed areas. Viscofan is positioned to grow
Developed areas. Viscofan is positioned to grow VISCOFAN. CASINGS REVENUE IN DEVELOPED AREAS. Base 100 year 2015 +5% TACC 2015- 2020 Organic + Inorganic 129 115 108 Value proposition to meet the 104 market demands 100 100 2015 2016 2017 2018 2019 2020 January – December 2020 results 33
Slide 34: A growing market
A growing market CASINGS PLAYERS* REVENUE (Base 100 year 2015) 126 116 109 106 107 Top 6 players 104 100 99 101 99 96 Top 5 ex Viscofan 98 97 99 94 94 2015 2016 2017 2018 2019 2020e * Includes Viscofan, Viskase, Devro, Kalle, Visko Teepak and Shenguan ** Released Financial Statements, market consens
Slide 35: We grow in fibrous. Project evolution
We grow in fibrous. Project evolution €15Mn Increasing capacity Plant construction aiming to be the leader • Improved proximity to the European market • Commercial success in this technology • Double digit sales growth 2016 2017 2018 2019 2020 2021 • Start-up COVID-19: The plant is • Learning curve
Slide 36: Search for greater efficiency in North America
Search for greater efficiency in North America Milestones achieved Nitta Casings, Vector, Transform Pak acquisitions Consolidate the Plastic casings plant in leadership in this market 2021e Mexico More product offer. Maintaining service in a Added Value COVID environment Commercial disci
Slide 37: Commitments and investments in sustainability
Commitments and investments in sustainability 2030 commitments 2021e capex in sustainability Boiler installation with green hydrogen -30% -10% -30% capacity in Cáseda and a new co-generation engine with green hydrogen 1 Reduction in CO2 2 Reduction in water 3 Reduction in emissions in withadrawal in
Slide 38: Strong cash flow generation
Strong cash flow generation OPERATING CASH FLOW (€ million) 242/246 234 CAPEX 2021e. 204 211 209 Breakdown by type 201 117 104 137 139 177 >172 Others Sustainability 23% 21% 107 87 Capex 2021e 72 70 62 57 20% 36% Proccess upgrade Capacity 2016 2017 2018 2019 2020 2021 e Operating cash flow (Mn €) =
Slide 39: Guidance 2021
Guidance 2021 US$/€: 1.20 € Million % y-o-y Revenue 935-950 +3% / +4% EBITDA 242-246 +3% / +5% Net Profit 127-130 +4% / +6% Capex ≈70 January – December 2020 results 39
Slide 40: To wrap-up
To wrap-up • Exceptional and very demanding year in which the human team delivered. • Growth in the main financial figures thanks to the solid foundations built in these years. • The casing market continues to show a high growth profile, both in exceptional environments and in the new cycle due to t
Slide 41: Appendix. Main financial figures
Appendix. Main financial figures Reported Like-for-like 1 Reported Like-for-like 1 Millones € 2020 % y-o-y % y-o-y 4Q20 % y-o-y % y-o-y Revenue 912.2 +7.4% +8.3% 240.3 +7.3% +11.3% EBITDA 234.4 +16.7% +27.7% 65.5 +13.4% +38.1% EBITDA margin 25.7% +2.0 p.p. +4.2 p.p. 27.2% +1.4 p.p. +5.6 p.p. Operati
Slide 42: Appendix. Alternative Performance Measures
Appendix. Alternative Performance Measures The Alternative Performance Measures included in this report are as follows: • The EBITDA, or operating profit before depreciation and • Net bank debt: This is calculated as non-current borrowings amortisation, is calculated excluding depreciation and plus