Hexagon Composites Asa · OSL:HEX
Hexagon Composites Asa — Investor Day (January 2021)
139 slides from Hexagon Composites Asa's investor day presentation, Jan 11, 2021
Slide 1: Hexagon: Clean air everywhere
Slide 2: Capital Markets Day 11 January 2021
Capital Markets Day 11 January 2021 13:00 – 13:10 CET Profitable green growth - Jon Erik Engeset, CEO Hexagon Group 15:00-15:55 CET 13:10- 13:50 CET • Accelerating zero emission mobility – Morten Holum, CEO Hexagon Purus Digitalization and new business models – the next big strategic step • Research
Slide 3: Disclaimer and important notice
Disclaimer and important notice This company presentation (the “Presentation”) has been prepared by Hexagon Composites ASA (“Hexagon” or the “Company”). The Presentation has not been reviewed or registered with, or approved by, any public authority, stock exchange or regulated market place. The Comp
Slide 4: Profitable, green growth
Profitable, green growth Jon Erik Engeset CEO Hexagon Group 4
Slide 5: Global market leader in type 4 cylinders and fuel systems
Global market leader Trusted supplier to in type 4 cylinders leading automotive and fuel systems and logistics companies Continues to innovate the value chain and offer unique customer values 5
Slide 6: The clean energy transformation is gaining massive momentum
The clean energy transformation is gaining massive momentum 6
Slide 7: Structured to leverage the market growth
Structured to leverage the market growth Hexagon Group 75% g-mobility e-mobility Hexagon Hexagon Hexagon Hexagon Hexagon Agility CNG LDV Digital Wave Ragasco Purus 7
Slide 8: Renewable Natural Gas (RNG) = Biogas = Biomethane = the ultimate clean fuel
Renewable Natural Gas (RNG) = Biogas = Biomethane = the ultimate clean fuel Global RNG market revenue is expected to reach USD 68 - 136 billion by 2030 The only fuel that Source: IEA can be net carbon- negative Increased by 210% over the past 5 years, displacing >4.2 million tons Biogas available of
Slide 9: Hexagon's addressable market is expected to grow 4x to ~8 USD bn in 2025
Hexagon’s addressable market is expected to grow 4x to ~8 USD bn in 2025 Total addressable cylinder system sales, USD Bn Hydrogen CNG x4 ~8.0 1.1 1.1 0.3 0.2 0.2 0.2 <0.1 0.2 <0.1 6.9 3.6 6.9 0.1 ~2.0 0.7 1.2 1.3 2020 2025 Total Trucks Mobile Bus Vans, PV Ground Other pipeline LCV, LDTs storage Sour
Slide 10: Digitalization and new business models – the next big strategic step for Hexagon
Digitalization and new business models – the next big strategic step for Hexagon Digitalization is a Will enable extended Smart and core part of the product life and connected systems Energy circularity of will generate new Transformation materials business models and revenue streams 10
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Slide 12: The new generation of cylinders is smart
The new generation of cylinders is smart Skjalg S. Stavheim President Hexagon Ragasco 12
Slide 13: World leading manufacturer of LPG composite cylinders
World leading manufacturer of LPG composite cylinders 125 Annual production employees capacity of 2 million cylinders Delivered Distribution over agreements with the 18 million largest LPG cylinders worldwide distributors
Slide 14: Total cylinder market is large, but has so far been dominated by steel
Total cylinder market is large, but has so far been dominated by steel… Number of cylinders (Million) Composite 19 1,200 1,100 98% 1,000 800 18 Ragasco 600 400 1 Other 200 0 Total tank market Steel Composite …smart cylinders will boost adoption and take market share from steel 14
Slide 15: Hexagon Ragasco has been a success story since introducing the composite LPG cylinder
Hexagon Ragasco has been a success story since introducing the composite LPG cylinder Significant growth in the past 15 years - with some variations between years Mill. NOK turnover 700 660 650 632 CAGR +14% 600 600 550 533 493 500 450 450 396 400 361 350 326 333 332 300 251 250 223 200 150 134 124
Slide 16: Our strategic agenda
Our strategic agenda Smart tank technology Drive composite adoption Operational excellence and substitute steel Geographic expansion 16
Slide 17: Geographical presence
Geographical presence Historical sales volumes pr. country 2000-2020 Sales Representatives 17
Slide 18: Operational excellence
Operational excellence The past 5 years, we have produced as many tanks as we did in the first 15 years of operation In 2004 we produced 300,000 cylinders with 10 operators per shift In 2019 we produced 1,600,000 million cylinders with 10 operators per shift
Slide 19: We are aiming to change the game in our market once again
We are aiming to change the game in our market once again 2000 2002-2020 2021-2025 Starting point Global expansion IoT & Digitalization The Selling to Smart lightweight +85 countries technology composite cylinder was a game changer
Slide 20: Why go Smart?
Why go Smart? Seamless purchase journey Gas level control 20
Slide 21: Make the cylinder talk
“Make the cylinder talk” “I’m empty, please fill me up” 21
Slide 22: Energy harvesting from Radio Waves
Energy harvesting from Radio Waves Battery-less IoT sensors inside Location Gas level control 22
Slide 23: IoT - An opportunity landscape for Hexagon Ragasco
IoT - An opportunity landscape for Hexagon Ragasco
Slide 24: Value chain transformation
Value chain transformation Connectivity and data Stock management optimization End user loyalty Sales monitoring
Slide 25: LPG Distributor benefits
LPG Distributor benefits GET CLOSER TO THE 1 END USER • Secure re-purchasing & increase loyalty • Direct marketing REAL-TIME DISTRIBUTION 2 MANAGEMENT • Enable data driven asset utilization • Avoid «sold-out» situations • Optimize logistics cost 25
Slide 26: Positioning to become the leading global supplier of smart connected LPG cylinders
We are positioning ourselves to become the leading global supplier of smart connected LPG cylinders Onboarding Launch & Increase the Double pilots Scale up adoption rate turnover 2021 2022 2023-2024 2025 26
Slide 27: Building our IoT opportunity and improving the circular economy
Building our IoT opportunity and improving the circular economy Jack Schimenti President Hexagon Digital Wave 27
Slide 28: Digital: Driving energy transformation in Hexagon
digital Driving energy transformation in Hexagon 28
Slide 29: Digital Wave has proprietary safety technology
Digital Wave has proprietary safety technology Modal Acoustic Emission (MAE) technology is used to analyze the cylinder structural integrity through ultrasonic guided waves 29
Slide 30: Vision with Smart Technology
Vision with Smart Technology MAEisisthe thecornerstone cornerstoneof the Developa acloud Develop cloudbased based Thedata datawill willbe beused usedto to MAE The of theTechnology Smart Technology “digitaltwin” “digital twin”ofofour CNG and CNG and increasecustomer customervalue value Smart enhance
Slide 31: Digitizing cylinder system creates a circular economy
Digitizing cylinder system creates a circular economy Tank-as-a-service Real-time Health Monitoring Extended life 31
Slide 32: Voice of customers
Voice of customers “A turnkey solution and direct “With live-monitoring, our replacement of their diesel product with technicians could quickly lower TCO, ESG targets and without identify problems and decide if “Having the possibility of full needing to build the expertise in-house they need to pull
Slide 33: Hexagon's addressable market is expected to grow 4x to ~8 USD bn in 2025
Hexagon’s addressable market is expected to grow 4x to ~8 USD bn in 2025 Total addressable cylinder system sales, USD Bn Hydrogen CNG x4 ~8.0 1.1 1.1 0.3 0.2 0.2 0.2 <0.1 0.2 <0.1 6.9 3.6 6.9 0.1 ~2.0 0.7 1.2 1.3 2020 2025 Total Trucks Mobile Bus Vans, PV Ground Other pipeline LCV, LDTs storage Sour
Slide 34: Digital shifts are opening new opportunities
Digital shifts are opening new opportunities IoT of tank Life extension Tank-as-a-service systems & real- & improving & leasing cylinder time health circular systems monitoring economy of our industry 34
Slide 35: Product launch in 2021, ramp-up in 2022, at full scale by 2025
Product launch in 2021, ramp-up in 2022, at full scale by 2025 Live Health Monitoring + Production Tank-as-a- Full scale repurposing of ramp-up service smart systems cylinders 2021 2022 2023 2025-2030 35
Slide 36: Bringing a digital wave into tank technology
Bringing a “digital wave” into tank technology world 36
Slide 37: Rapid expansion of (renewable) natural gas
Rapid expansion of (renewable) natural gas Seung Baik President, Hexagon Agility 37
Slide 38: We had a positive impact on the environment in 2020
We had a positive impact on the environment in 2020 CO2 114,389 Number of passenger cars removed 583,618 Tons of GHG removed 700,342 Acres of forest saved 38
Slide 39: Heavy duty trucks are 20x dirtier than passenger cars
Heavy duty trucks are 20x dirtier than passenger cars Add new visual 39
Slide 40: Our customers are switching to clean energy fuels
Our customers are switching to clean energy fuels Will purchase more A division of PepsiCo’s than 6,000 natural CNG fleet to grow 500+ gas vehicles vehicles, representing between 35+% of long-haul fleet 2020 – 2022 Converting entire long-haul fleet to RNG Cutting fleet powered trucks by 2025, emissi
Slide 41: Leading global provider of natural (renewable) gas vehicle fuel systems and gas transport modules
Leading global provider of natural (renewable) gas vehicle fuel systems and gas transport modules Annual production Long-term 700+ employees, capacity of agreements with 10 facilities & 40,000 global 6 countries high-pressure OEMs and fleets tanks Delivered Market leader in 70,000+ fuel North Americ
Slide 42: We deliver customized fuel systems to OEMs and fleets
We deliver customized fuel systems to OEMs and fleets
Slide 43: Composite cylinder winding in Lincoln, Nebraska
Composite cylinder winding in Lincoln, Nebraska
Slide 44: System assembly in Salisbury, North Carolina
System assembly in Salisbury, North Carolina
Slide 45: Installation area in Salisbury, North Carolina
Installation area in Salisbury, North Carolina
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Slide 48: #1 vertically integrated low emissions fuels solutions provider
#1 vertically integrated low emissions fuels solutions provider 48
Slide 49: Proprietary and Confidential
Proprietary and Confidential
Slide 50: One slide with pic – in environment
One slide with pic – in environment 50
Slide 51: Revenue split per vehicle business segment
Revenue split per vehicle business segment Heavy-Duty Truck Medium-Duty Truck Transit Bus Refuse Truck ~40% ~10% ~30% ~20% * Note: Based on 2020E 51
Slide 52: Our products are lightweight and have long range
Our products are lightweight and have long range System weighs under 900 kg *30% lighter than steel and the lightest on the market Over 1,500+ km of range *175 (Diesel Gallon Equivalent) ProCab®
Slide 53: What is Renewable Natural Gas (RNG)?
• What is Renewable Natural Gas (RNG)? ‒ Bio-methane captured or produced from waste (e.g., landfill, wastewater or agriculture) Landfill ‒ Interchangeable with conventional natural gas and can be used in any natural gas vehicle (NGV) ‒ Total production and use of RNG results in GHG emissions that a
Slide 54: Our target markets will grow significantly
Our target markets will grow significantly # of New Vehicles • North American new Class 6-8 vehicle sales = 300,000 to 400,000 80,000 per year • CNG new Class 6-8 vehicle sales 60,000 = 6,000 to 8,000 per year (~2% adoption currently) 40,000 • North America is approx. 30% of global Class 6-8 vehicle
Slide 55: Sustainability is driving natural gas truck adoption
Sustainability is driving natural gas truck adoption 140,0 4,00 CAGR 25% 3,50 120,0 3,00 100,0 2,50 80,0 2,00 60,0 1,50 40,0 1,00 20,0 0,50 - - 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021E Revenue Diesel Gasoline CNG Fuel price differential driving adoption Sustainability driving ado
Slide 56: We expect to double our revenue in 5 years
We expect to double our revenue in 5 years >2x • Governmental mandates are favorable to natural gas vehicles, especially in Europe • Ambitious sustainability targets among fleet owners and users • Expanding capacity and broadening our product portfolio 2020 2021 2022 2023 2024 2025 • New market entr
Slide 57: Agility Fuel Solutions and Mobile Pipeline: a powerful combination
Agility Fuel Solutions and Mobile Pipeline: a powerful combination Combines Better situated to Hexagon’s g- achieve mobility World Class strategy into one Manufacturing business area Maximize customer Streamline experience and operational expand customer processes and relationships such as increase
Slide 58: Energy where you need it: The growing influence of Mobile Pipeline
Energy where you need it: The growing influence of Mobile Pipeline across multiple segments Miguel Raimao VP Mobile Pipeline, Hexagon Agility 58
Slide 59: What is Mobile Pipeline
What is Mobile Pipeline® Pipeline to Stranded User Asphalt, Ceramics, Papermills, Energy Intensive Food Production, Beverages, Industrial Plants Power Generation, O&G Drilling Oil & Gas Stranded Gas to Pipeline Off-grid landfills and Agriculture Renewable Natural Gas Flare gas from oil production Fl
Slide 60: Hexagon leads the world in Mobile Pipeline
Hexagon leads the world in Mobile Pipeline® Mobile Pipeline® offers the most comprehesive product portfolio, while TITAN® continues to be the largest gas storage cylinder in the world Exciting new product development employing our Smart Systems technology will ensure our continued leadership 60
Slide 61: Expanding Mobile Pipeline Segments
Expanding Mobile Pipeline® Segments Utilities Industrial Gases RNG Mobile Refueling Units MicroCNG Marine CNG Pipeline to Pipeline Pipeline to Pipeline Power Generation Power Generation Energy Intensive Energy Intensive Energy Intensive Oil and Gas Oil and Gas Oil and Gas 2008 - 2012 2013 - 2018 201
Slide 62: Global Successes
Global Successes Oil & Gas Exploration 160,000 tons CO2 / yr est $70M fuel savings Air Liquide, RNG, UK 25-50,000 tons CO2 / yr PTT NGV Stations DTE RNG, USA Thailand – 2014 340,000 tons CO2 / yr 460,000 tons CO2 / yr est $400M fuel savings Nestle, Mexico – 2014 10,000 tons CO2 / yr Est $8-10M fuel
Slide 63: Global Challenges and Opportunities
Global Challenges and Opportunities Flared Gas Renewable In 2019, 150 billion m3 flared Natural Gas due to lack of infrastructure Global demand expected: 225 = 42,000 Mobile Pipeline Trailers billion m3 by 2040 loads per day = 63,000 Mobile Pipeline Trailer Loads per day or 360 million tons CO2 per
Slide 64: Renewable Natural Gas Potential for Mobile Pipeline
Renewable Natural Gas Potential for Mobile Pipeline® Current Production vs Potential Carbon Intensity Score, CO2 Equivalent Billion m3 / yr 100 75 • Less than 5% of today’s global RNG 15 potential is currently being produced 39 817 • Agricultural RNG has negative carbon Current Global RNG Production
Slide 65: Mobile Pipeline – RNG Customer Highlight
Mobile Pipeline® – RNG Customer Highlight • Distributing 5.5 million m3 of RNG per year via Mobile Pipeline • RNG from dairy waste with negative CO2e emissions 115% lower than diesel • US Gain’s RNG production from this single project, is the equivalent of eliminating 10.5 million miles driven by a
Slide 66: Short- to medium term demand potential
Short- to medium term demand potential (in #Titan equivalents*) Estimated 5yr Demand (low-high) Identified Potential (low-high) O&G / Flare Gas 160 300 565 565 Pipeline to Pipeline 100 180 300 865 RNG 113 185 620 1485 Industrial Gases 70 100 165 1650 Other 60 150 350 2000 Marine CNG 12 80 1400 3400
Slide 67: Driving Energy Transformation
Driving Energy Transformation • Global Energy demand presents both challenges and opportunities • Market leader in with more than 1400 transport modules delivering natural gas around the world. • Diversifying Mobile Pipeline® into key market segments • Mobile Pipeline® provides a critical solution t
Slide 68: Hexagon Commercialization Strategy
Hexagon Commercialization Strategy Eric Bippus SVP Sales & Marketing, Hexagon Agility 68
Slide 69: World leader in clean energy solutions
World leader in clean energy solutions RNG CNG Hexagon has more Battery Electric clean energy solutions in service than anyone Propane else - with over 80,000 medium-duty and Hydrogen heavy-duty vehicles globally LNG
Slide 70: The Hexagon advantage
The Hexagon advantage With today’s OEMs and fleets seeking to lower vehicle emissions… …our focus is building Hexagon’s portfolio and support network to solve their challenges. Hexagon delivers the broadest off-the-shelf fully developed technology while ensuring seamless OEM integration and support
Slide 71: Hexagon Commercial Centers of Excellence
Hexagon Commercial Centers of Excellence Hexagon is committed to customer intimacy through our global commercial presence Market support: Sales and Engineering Project Management Technical Support Customer Care 71
Slide 72: Hexagon clean energy mobility portfolio
Hexagon clean energy mobility portfolio Global Commercial Centers of Excellence Hexagon Group offering Vehicle OEM platforms Simplifying OEM Hydrogen CNG integration type 4 cylinders type 4 cylinders Project mgt Engineering Hydrogen CNG Technical support Propane system Battery system / packs Systems
Slide 73: Commercial Centers of Excellence supporting over 116 global customer projects
Hexagon Commercial Centers of Excellence Supporting over 116 global customer projects 40 50 6 Open Customer Projects 10 CNG 60 Battery Electric 20 10 FCEV 25 H2 Distribution 5 CNG Distribution 6 73
Slide 74: Best-in-Class OEM Global Support
Best-in-Class OEM Global Support Hexagon has partnered with Daimler to put >9,000 vehicles into service utilizing CNG, hydrogen and BEV clean energy solutions in Europe and North America 74
Slide 75: Hexagon providing clean energy solutions to the Daimler Group globally
Hexagon providing RNG/CNG, Propane and BEV clean energy solutions to the Daimler Group globally EvoBus European CNG Transit bus North America Class 6-8 CNG Truck Final Mile Delivery vehicle eCascadia Battery Electric CNG and Propane Class 8 Heavy Duty North America North America 75
Slide 76: RNG making an impact now
RNG making an impact now RNG/Biogas –higher GHG emissions savings than other fuels -202% -80% “Trucks are the No. 1 source of smog ~40% ~20% While HDVs total 7 percent of all vehicles Biogas from on America’s roadways, they account -14% Wet Bio- H2/El EU Natural for upwards of 50 percent of all smog
Slide 77: RNG the GHG reduction game changer
RNG the GHG reduction game changer California North America Source: NGVA America 77
Slide 78: Hexagon providing clean energy logistics solutions for UPS
Hexagon providing clean energy logistics solutions for UPS Hexagon and UPS have partnered to maximize the adoption of RNG across Home delivery package car CNG 2,500 in service the UPS range of vehicle platforms “The use of RNG is a very Class 8 long haul RNG/LNG important part of UPS’s strategy to 2
Slide 79: Raising the bar with technology advancements
Raising the bar with technology advancements Continued Hexagon technology advancements lead to continued customer loyalty Digital Wave smart tank technology is the next game changer in CNG system improvements 79
Slide 80: Hexagon is positioned well to take advantage of the global trend to natural gas
Hexagon is positioned well to take advantage of the global trend to natural gas and other clean energy solutions Total addressable tank system sales, USD Bn Hydrogen CNG x4 ~8.0 1.1 1.1 0.3 0.2 0.2 0.2 <0.1 0.2 <0.1 6.9 3.6 6.9 0.1 ~2.0 0.7 1.2 1.3 2020 2025 Total Trucks Mobile Bus Vans, PV Ground O
Slide 81: Why wait?
Why wait? Hexagon’s broad portfolio of clean energy solutions create a roadmap for improved corporate sustainability goals that can be achieved today The future is now……. 81
Slide 82: Accelerating zero emission mobility
Accelerating zero emission mobility Morten Holum CEO Hexagon Purus 82
Slide 83: Hexagon Purus – driving the hydrogen transition
Hexagon Purus – driving the hydrogen transition Zero emission Hexagon Purus is a global leader in zero emission e-mobility, driving energy transformation through its hydrogen cylinders/systems, battery systems and electric drivetrain technologies 83
Slide 84: The green shift has crossed the tipping point
The Thegreen greenshift shifthas hascrossed crossedthe thetipping tippingpoint… point… Investment flow into Tighter green energy & emissions zero emission standards technologies Countries committing to "new green deal" 185 Parties that have ratified the Paris Agreement to date out of 197 parties to
Slide 85: Hydrogen cylinder market can exceed USD ~7bn by 2030
Sizable market opportunity: Hydrogen cylinder market can exceed USD ~7bn by 2030 HEXAGON PURUS’ ADDRESSABLE HYDROGEN CYLINDER REVENUE POOL (USDBN)1 Passenger vehicles Hydrogen vehicle USD ~7bn hydrogen cylinder market Vans, LCV and LDT adoption rate3 revenue pool in 2030 MDTs and HDTs 2025 2030 Bus
Slide 86: Hexagon Purus is well positioned to capture the market growth
Hexagon Purus is well positioned to capture the market growth 1 2 3 Deep competence in core technologies Wide range of solutions delivered across the Exciting project pipeline needed for zero emission mobility mobility spectrum TYPE 4 86
Slide 87: A world leading company within hydrogen cylinders/systems
1 Hexagon Purus – a world leading company within hydrogen cylinders/systems… Hydrogen storage cylinders Cylinder systems Compressed hydrogen carbon fibre composite Hydrogen fuel systems cylinders TYPE 4 87
Slide 88: Battery systems and electric drivetrain solutions
1 …and in battery systems and electric drivetrain solutions Drivetrain integration for zero emission medium and heavy-duty vehicles (BEV, FCEV, hybrids) Example of components that Hexagon Purus integrate in fuel cell electric trucks Hydrogen storage cylinders Accessory drive modules Power electronic
Slide 89: Solutions delivered to world class customers across end-use applications
2 Solutions delivered to world class customers across a wide range of end-use applications Adjacent markets Construction & mining Toyota fuel cell electric heavy-duty 350 bar cylinders for the Xcelsior 700 bar cylinders to Mercedes 300 bar and 500 bar gas distribution Agriculture truck transit bus –
Slide 90: Delivered cylinders to the world's first hydrogen powered snow groomer
2 Delivered cylinders to the world’s first hydrogen powered snow groomer 90
Slide 91: Delivered battery solutions and vehicle integration to Daimler's innovation fleet
2 Delivered battery solutions and vehicle integration to Daimler´s innovation fleet 28 eCascadia’s / 8 eM2´s Now successfully logged approx. 1 million fleet miles 91
Slide 92: Awarded hydrogen FCEV contract with leading Northeast Asian OEM
3 Awarded hydrogen FCEV contact with leading Northeast Asian OEM Serial supply of cylinders for an existing zero emission FCEV SUV 2-year contract, with estimated sales value of EUR 25 million Terms and conditions now agreed 92
Slide 93: Contract with Stadler for hydrogen-powered commuter train
3 …following Contract with a line Stadler of several for hydrogen-powered recent key announcements… commuter train Awarded contract to supply hydrogen cylinder systems for the first hydrogen- powered commuter train in the US Image for illustration purposes only; does not reflect the actual train ref
Slide 94: Selected as development partner to Hino Trucks
3 Selected as development partner to Hino Trucks Selected development partner to provide battery packs and drivetrain integration on multiple Hino platforms 94
Slide 95: Multi-year contract with Everfuel for hydrogen distribution systems
3 Multi-year contract with Everfuel for hydrogen distribution systems Multi-year frame agreement worth EUR 14m to deliver multiple hydrogen distribution systems through to 2025 95
Slide 96: Project pipeline supporting acceleration of growth
3 ...and a project pipeline supporting acceleration of growth in concert with the market LIGHT-DUTY MEDIUM & HEAVY DISTRIBUTION MARINE, RAIL, GROUND OTHER VEHICLES DUTY VEHICLES STORAGE AND MOBILE REFUELING More than 80 projects High number of hydrogen and battery electric development projects acros
Slide 97: Final stage of negotiation on the JV in China
Hexagon Purus is in the final stage of negotiation on the JV in China – the world’s largest hydrogen market 50% 1,000,000 of new car sales to be zero FCEVs by 2035 emission1 by 2035 • Term sheet agreement for a strategic cooperation signed in May 2020 • Targeting signing of JV agreement in Q4 2020 5
Slide 98: Solid top-line growth expected in 2021
Solid top-line growth expected in 2021 GROUP REVENUES | NOKm >50% YoY revenue growth expected in 2021 217 LTM Q3 2020 2021 98
Slide 99: Financial ambitions
Financial ambitions 2025 REVENUE AMBITIONS LONG-TERM PROFITABILITY AMBITIONS Double-digit NOK 4-5bn EBITDA margins 99
Slide 100: Excellent starting position to capitalize on market momentum
Hexagon Purus has an excellent starting position a to capitalize on the market momentum Global zero emission mobility champion Strong early mover position Today 2030 Solid substance Market segments forecasted to grow by a • Strong execution legacy factor of more than 50x – One of few players w
Slide 101: Hexagon Purus in pole position to benefit from sizable market opportunity
Hexagon Purus in pole position to benefit from sizable market opportunity A company with a strong heritage and a solid track record Deep competence and state-of-the-art technology Established manufacturing facilities Strong relationships with world class customers Experienced global team with proven
Slide 102: Research & Development – the very core
Research & Development – the very core Rick Rashilla SVP Research & Development 102
Slide 103: R&D in the Hexagon value chain
R&D in the Hexagon value chain COLLABORATION Hexagon Business EXAMINATION Area Ambitions The R&D group activities are distinctly tied to our EVALUATION Hexagon Operations world class manufacturing INNOVATION of Hydrogen and CNG Hexagon Business tanks Support Demands Global R&D comprises 130 people,
Slide 104: Hexagon R&D - Experience
Hexagon R&D - Experience In our 5th decade of building commercial gas storage tanks upon a legacy foundation in aerospace and automotive 104
Slide 105: Why value Hexagon Group R&D?
Why value Hexagon Group R&D? In composite materials, experience counts No company has Database equips developed more Type us to balance “low 4 CNG or H2 tanks cost” with than Hexagon consistent “high performance” 105
Slide 106: Pioneering composite tank technology
Pioneering composite tank technology Part of Combined development team achievements from for world’s first four technical Type 4 tank centres regulation Largest producer and tester of Type 4 tanks 106
Slide 107: Hexagon R&D Philosophy: Collaboration
Hexagon R&D Philosophy: Collaboration • Keep R&D close to the customer and market • Customer-funded and national lab R&D work • Support business areas with IP creation 107
Slide 108: Hexagon R&D Philosophy: Innovation
Hexagon R&D Philosophy: Innovation • New design/testing/inspection techniques • New methods of applying carbon fiber; ‒ Towpreg ‒ Dry winding Year 1985 Year 2020 • Evaluation of new materials • Find and Sort “Big Lever” Technical advancements • Understanding metal versus plastic versus “linerless” t
Slide 109: R&D results nurture combined success for Hexagon Group
R&D results nurture combined success for Hexagon Group – future game changers • New regulation that minimizes carbon fiber needed • Reduce environmental trace of production • Level playing field with Type 2 or Type 3 tanks by “proving” reliability to overcome local market barriers (China, India, Sou
Slide 110: Market pressure yields product improvements
Market pressure yields product improvements Market place Business objectives COLLABORATION Hexagon Business Business area & Hexagon Cost reduction Area Ambitions EXAMINATION Customer demands Operations EVALUATION Competitive Performance Pressures INNOVATION improvement of Hydrogen and CNG tanks is c
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Slide 112: Strengthening the Hexagon Brand
Strengthening the Hexagon Brand Karen Romer SVP Communications 112
Slide 113: Brand is a business asset that represents up 30% of business value
Brand is a business asset that represents up 30% of business value 113
Slide 114: Brand is a key driver of Enterprise Value for Hexagon
Brand is a key driver of Enterprise Value for Hexagon 114
Slide 115: Build the Hexagon brand as the Global Leader in Clean Fuel Solutions
Build the Hexagon brand as the Global Leader in Clean Fuel Solutions TODAY FUTURE Leading manufacturer of High- The Global Leader in Clean Fuel Solutions Pressure tanks Hexagon Hexagon Hexagon Hexagon Ragasco Agility Purus Digital Wave HEXAGON Smart Systems LPG + G-Mob + E-Mob + Smart Systems LPG G-
Slide 116: The clean energy transformation is gaining massive momentum
The clean energy transformation is gaining massive momentum 116
Slide 117: Vision: Clean air everywhere
Beliefs That clean air is a right not a privilege That technology is no longer the barrier in enabling clean transport for all The future belongs to the bold That change is urgent Vision Clean air everywhere Role As market leader, our job is to help to accelerate the rate of change 117
Slide 118: HEXAGON
HEXAGON
Slide 119: Progress is possible with change
(HéxAcon Progress is possible with change (Hé&xdcon Clean air Impatience is our advantage everywhere
Slide 120: Hexagon Group Presentation template
This is a Hexagon Group Presentation asian itivel and enhance the qual Sub heading DD. MMYY ual 4 We expand. We frame. Clean air Extraordinary everywhere focus. ‘We're global leaders in non-destructive testing of high-pressure vessels. Hexagon Agility i} 120
Slide 121: Hexagon billboard brand mockup
Slide 122: Strong balance sheet & profitable growth
Strong balance sheet & profitable growth David Bandele CFO Hexagon Group 122
Slide 123: Hexagon Composites Group
Hexagon Composites Group Leading clean energy solutions provider ~13bn* ~19bn* ~1200 10 Market Cap Market Cap employees Production and HEX.OL HPUR.OL engineering hubs 75% owned by HEX.OL globally * As of 8th January 2021 123
Slide 124: Hexagon Group: Hexagon (HEX.OL) and Hexagon Purus (HPUR.OL)
Hexagon Group: Hexagon (HEX.OL) and Hexagon Purus (HPUR.OL) Hexagon Composites ASA / Group 100% 75% Hexagon Hexagon Purus g-mobility HEXAGON AGILITY CNG LDV RAGASCO DIGITAL WAVE HYDROGEN AND BATTERY ELECTRIC Refuse Transit busses Long Haul Passenger Trucks cars Leisure Household Industrial Digitalis
Slide 125: Leveraging strong platform of Hexagon Group to create value
Leveraging on strong platform of Hexagon Group to create value and capture future growth Hexagon Composites ASA / Group R&D Route to market Strategic Innovation Leveraging our core through unique and leading - developer of complimentary competence in Type position as a One-stop- businesses and oppor
Slide 126: Hexagon Group: Strong revenue growth – CAGR +18% over two decades
Hexagon Group Strong revenue growth – CAGR +18% over two decadesdecades NOKm 3 500 3 000 2 500 CAGR +18% 2 000 1 500 1 000 500 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 LTM Q3’20 126
Slide 127: Hexagon Group: Revenue by segment
Hexagon Group Revenue by segment Hexagon Composites ASA g-mobility Hexagon Hexagon Hexagon Hexagon Hexagon Agility 1) CNG LDV Digital Wave 2) Ragasco Purus ~70% ~2% ~20% ~8% Note: data as of LTM Q’3’20 revenue 1) Hexagon Agility represents the combination of Mobile Pipeline and Agility Fuel Solution
Slide 128: Hexagon Group: Revenue by geography
Hexagon Group Revenue by geography 1% Norway 30% 61% Europe North America 8% Currently expanding in Asia Rest of the world % of sales revenue 128
Slide 129: Hexagon Group: R&D has a central role across business areas
Hexagon Group R&D has a central role across business areas R&D division accounts for 11% of total FTE #FTEs 11% 130 1 201 94 36 130 Total Group FTEs R&D division Hexagon Purus Group R&D R&D focus in Germany, USA, Canada and Norway 10% 15% 19% 56% Germany USA Canada Norway Note: FTEs as of Q3 2020 12
Slide 130: Effective strategic and operational capex investments to date
Hexagon Group: Effective strategic and operational capex investments to date NOKm Hexagon Group (incl.Purus) 2 Maintenance 81 60 Maintenance capex increased in 2019 after acquiring Hexagon 50 52 Agility; similar levels expected to continue After a slow down in 2016 and 2017, Growth and other capex G
Slide 131: Strong balance sheet to support continued growth
Strong balance sheet to support continued growth Q3 2020 Hexagon Group Q3 2020 Hexagon¹ • Unsecured Bond facility financing 2019 Hexagon Agility acquisition: NOK m 1 022 – NOK 1.1 bn 379 – Coupon at 3m N+375bps 1 100 957 500 – Maturing in March 2023 522 – Callable from March 2021 522 • Secured Bank
Slide 132: Hexagon Group weathering the storm of the pandemic
Hexagon Group weathering the storm of the pandemic I Resilient business Strategy Solid liquidity & Balance sheet Record Q3 for Hexagon Agility Reorganized businesses and 3 successfully completed & strong cash generation in With additional liquidity of Hexagon Purus spin-off Hexagon Ragasco NOK 0.65b
Slide 133: Hexagon 2021 targets
Hexagon 2021 targets* Substantial and profitable growth Revenue target 2021 EBITDA target 2021 EBITDA margin target 2021 >15% >30% +1 to 2% 11-12% 9-10% 2020E Target 2021E 2020E Target 2021E 2020E Target 2021E * Excluding Hexagon Purus and subject to no material unforeseen impacts from global pandem
Slide 134: Hexagon underlying EBITDA of NOK ~500m in 2021
Hexagon underlying EBITDA1 of NOK ~500m in 2021 NOKm 500 World Class Manufacturing ‒ Productivity increases in Hexagon Ragasco to be duplicated at other sites ‒ Lincoln, Nebraska cylinder site is of key importance Product development & digitalization ‒ Scale –up of organization to meet anticipated m
Slide 135: What this means for our Investors
What this means for our Investors Hexagon Composites ASA / Group Hexagon Composites ASA (Hexagon Group) Essential player in enabling low and zero emissions mobility, a rapidly growing multi-billion $ market Make an impact by participating in our vision of Clean Air Everywhere Hexagon Hexagon Purus D
Slide 136: Closing remarks
Closing remarks Jon Erik Engeset CEO Hexagon Group 136
Slide 137: Profitable, green growth
Profitable, green growth G-Mobility and E-Mobility equally key to driving clean energy transformation Hexagon Agility targeting significant growth in the years ahead - RNG a major driver Hexagon Purus claiming leadership position for e-mobility solutions Hexagon Ragasco and Hexagon Digital Wave enab
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