Tecnicas Reunidas Sa · BME:TRE
Tecnicas Reunidas Sa — H1 2021 Earnings Presentation
30 slides from Tecnicas Reunidas Sa's earnings presentation, Jul 30, 2021
Slide 1: H1 2021 Results Presentation
H1 2021 RESULTS PRESENTATION JULY 30TH 2021 JUAN LLADÓ CHAIRMAN
Slide 2: Challenging environment, immediate awards, strengthening our financial profile
CHALLENGING ENVIRONMENT IMMEDIATE AWARDS STRENGTHENING OUR FINANCIAL PROFILE WITH SEPI SUPPORT 2
Slide 3: Covid is still damaging our operations
COVID IS STILL DAMAGING OUR OPERATIONS CHALLENGING ENVIRONMENT IMMEDIATE AWARDS Execution progress impacted by new Covid variants Demand recovery drives pipeline growth Revenues accruing from a small % of a large backlog Key awards already materialized Covid costs and provisions impact on P&L Alread
Slide 4: Execution progress impacted by new Covid variants
EXECUTION PROGRESS IMPACTED BY NEW COVID VARIANTS GCC* Covid cases Million cases • Execution adapted to health +70% 2.4 requirements 1.4 • Limitations to mobility: site access, inspections, commissioning,… 1st March 2021 26th July 2021 • Customized action plans for every project *GCC (Golf Cooperati
Slide 5: Execution progress impacted by new Covid variants
EXECUTION PROGRESS IMPACTED BY NEW COVID VARIANTS GCC* Covid cases Million cases • Execution adapted to health +70% 2.4 requirements 1.4 • Limitations to mobility: site access, inspections, commissioning,… 1st March 2021 26th July 2021 • Customized action plans for every project India Covid cases Pa
Slide 6: Revenues accruing from a small % of a large backlog
REVENUES ACCRUING FROM A SMALL % OF A LARGE BACKLOG Current YTD backlog situation Reprogrammed projects: confirmed and with active dialogue with clients Reprogrammed projects (up to 2022-23) 19% New awards: immediately launched, but New awards in 2021 27% 54% with small contribution to sales in 2021
Slide 7: Covid costs and provisions impact on P&L
COVID COSTS AND PROVISIONS IMPACT ON P&L 10% - 15% 50% - 60% 100% ENGINEERING PROCUREMENT CONSTRUCTION +€7.5B projects at commissioning Projects at commissioning Talara Al Zour GT5 Key projects contributing to 2021 Ras Tanura sales keep advancing, despite Key projects contributors to 2021 sales chal
Slide 8: H1 2021 EBIT
H1 2021 EBIT H1 2021 EBIT €M 3.1% +2 +25 44 +103 -148 +61 EBIT Extraordinary Covid UK Other Covid Restructuring Adjusted provision (Teesside) impact costs EBIT 8
Slide 9: Cash management
CASH MANAGEMENT Net cash position €M • Active client management led to 197 stable cash position despite: 113 94 o Teesside cash outflow 63 o Slower cashflows due to Covid 9M 2020 FY 2020 Q1 2021 H1 2021 9
Slide 10: H1 2021 figures
H1 2021 FIGURES Sales €1,422m EBIT €-148m Adjusted EBIT* €44m Adjusted EBIT margin* 3.1% Net cash €94m YTD Order intake €2.9B YTD Backlog €10.1B *Adjusted EBIT includes net UK Covid impact (€103m), net ex-UK Covid impact (€25m), extraordinary provision (€61m) and restructuring costs (€2m) 10
Slide 11: Major investment wave continues
MAJOR INVESTMENT WAVE CONTINUES CHALLENGING ENVIRONMENT IMMEDIATE AWARDS Execution progress impacted by new Covid variants Demand recovery drives pipeline growth Revenues accruing from a small % of a large backlog Key awards already materialized Covid costs and provisions impact on P&L Already into
Slide 12: Demand recovery drives pipeline growth
DEMAND RECOVERY DRIVES PIPELINE GROWTH Oil demand evolution (mbd) 105 100 95 90 €50B pipeline 85 • Well positioned for immediate awards • Expected order intake €4bn+ 2019 2020 2021 2022 2023 2024 Gas demand evolution (bcm) 4.400 4.200 4.000 3.800 3.600 2019 2020 2021 2022 2023 2024 Source: IEA 12
Slide 13: Key awards already materialized
KEY AWARDS ALREADY MATERIALIZED Petrochemical plant* Europe €600m MAY - JUNE 13 *Projects already awarded
Slide 14: Key awards already materialized
KEY AWARDS ALREADY MATERIALIZED Petrochemical plant* Europe €600m • New bio-methanol plant in Amsterdam that uses non- Biofuel plant* recyclable wood waste, domestic and industrial waste Europe €200m+ • Possibility to replicate the plant: Netherlands, UK and other Europe MAY - JUNE 14 *Projects alre
Slide 15: Key awards already materialized
KEY AWARDS ALREADY MATERIALIZED Petrochemical plant* Europe €600m Biofuel plant* Europe €200m+ MAY - JUNE • Industrial complex expansion in Plock (Poland) Olefins plant* • Integration of petrochemical operations with clean fuels Europe • 420 engineers engaged €900m+ • EPC contract after previous com
Slide 16: Key awards already materialized
KEY AWARDS ALREADY MATERIALIZED Petrochemical plant* • Residual streams upgrading unit at Moscow refinery Europe €600m • EP + Construction management and start-up of the unit Delayed coker* • Environmental enhancement by increasing the Europe production of clean fuels Biofuel plant* €240m Europe • 1
Slide 17: Key awards already materialized
KEY AWARDS ALREADY MATERIALIZED Petrochemical plant* Europe €600m Delayed coker* Europe Biofuel plant* Europe €240m €200m+ MAY - JUNE • JV with General Electric for a combined cycle in Olefins plant* Poland for Energa (PKN Orlen) Europe €900m+ Power plant* • CO2 reduction by switching carbon based t
Slide 18: Key awards already materialized
KEY AWARDS ALREADY MATERIALIZED Petrochemical plant* Europe €600m Undisclosed Delayed coker* client Biofuel plant* Europe • Competitive FEED for a new polypropylene Europe €240m Petrochemical plant in Europe plant* €200m+ Europe • Around €900m total investment MAY - JUNE Olefins plant* Europe Power
Slide 19: Key awards already materialized
KEY AWARDS ALREADY MATERIALIZED Petrochemical plant* Europe €600m Undisclosed Delayed coker* client Europe Biofuel plant* Europe €240m Petrochemical plant* €200m+ Europe MAY - JUNE Undisclosed client Olefins plant* Europe Natural gas* Middle East • Natural gas project in Middle East €900m+ Power pla
Slide 20: Key awards already materialized
KEY AWARDS ALREADY MATERIALIZED PTA plant €600m In Turkey for SASA Polyester Biofuel plant €200m+ In Amsterdam for Global Industrial Dynamics YTD Order intake Olefins plant €900m+ In Poland for PKN Orlen €2.9B Engineering >€60m Several FEEDs and feasibility studies Delayed coker €240m YTD backlog In
Slide 21: €2.9B already awarded; well positioned in €6.0B tenders for H2 2021
€2.9B ALREADY AWARDED; WELL POSITIONED IN €6.0B TENDERS FOR H2 2021 Petrochemical plant* Natural Gas Europe Power plant Middle East €600m Undisclosed Latam >€400m Delayed coker* client €400m Petrochemical Europe Petrochemical Biofuel plant* complex Europe €240m Petrochemical complex Europe plant* Eu
Slide 22: Already into the energy transition
ALREADY INTO THE ENERGY TRANSITION Our markets Our strengths CLEAN FUELS CUSTOMERS PETROCHEMICAL SERVICES NATURAL GAS METHODOLOGY A unique and trusted platform for speeding up HYDROGEN PEOPLE decarbonization and enabling CARBON CAPTURE the energy transition AND STORAGE INNOVATION BIO ENERGIES 22
Slide 23: Already into the energy transition: €3B pipeline
ALREADY INTO THE ENERGY TRANSITION €3B energy transition pipeline Main projects under execution: • AMA: designing a bio methanol plant that uses non-recyclable waste and biomass • Repsol: agreement to develop decarbonization technologies and promoting circular economy • Enagas/Acciona: engineering s
Slide 24: Strengthening our financial profile with SEPI support
CHALLENGING ENVIRONMENT IMMEDIATE AWARDS STRENGTHENING OUR FINANCIAL PROFILE WITH SEPI SUPPORT 24
Slide 25: Longer recovery time and promising future: strengthening our financial profile
LONGER RECOVERY TIME AND PROMISING FUTURE: STRENGTHENING OUR FINANCIAL PROFILE COVID IMPACT A STRATEGIC COMPANY PROMISING INVESTMENT ENVIRONMENT • Deep Covid impact in • Industrial leader • Recovery of investments operations since march 2020 • Unique platform for • Successful awards decarbonization
Slide 26: SEPI support fund to strategic and sound companies impacted by Covid
SEPI SUPPORT FUND TO STRATEGIC AND SOUND COMPANIES, IMPACTED BY COVID • European Union and member countries are • Terms of support: developing supporting schemes to alleviate o €150m participative loan (hybrid equity) + companies from COVID effects €140m ordinary loan o Reference tenor: 4 years, sub
Slide 27: Transition is taking more time than expected
TRANSITION IS TAKING MORE TIME THAN EXPECTED CHALLENGING ENVIRONMENT IMMEDIATE AWARDS SALES Above €3.0B ADJUSTED EBIT margin Around 3.0% AWARDS €4B+ *Assuming current COVID conditions and trends 27
Slide 28: Tecnicas Reunidas
y TECNICAS REUNIDAS
Slide 29: Disclaimer
DISCLAIMER This document has been prepared by Técnicas Reunidas S.A. (the Company) solely for use at presentations held in connection with the announcement of the Company's results. This document contains forward-looking statements of the Company and/or its management. These forward looking statemen
Slide 30: Pipeline analysis
PIPELINE ANALYSIS Pipeline per division Pipeline per calendar Pipeline per geography (expected award date) 4%10% Clean Fuels 12% 9% Middle East 5% 7%1% Q3 2021 Asia Pacific Petrochemical 29% Q4 2022 Europe 39% Energy Transition H1 2022 20% 27% Natural Gas H2 2022 LatAm 32% North America Other 5% 52%