Slide 1: End of Dispute - Geared Up for Accelerated Growth
END OF DISPUTE - GEARED UP FOR ACCELERATED GROWTH MEDIA AND ANALYSTS PRESENTATION MAY 11, 2018
Slide 2: Highlights
HIGHLIGHTS Transfer of control premium to all shareholders Transaction immediately EPS accretive to all shareholders Implementation of efficient capital structure Creation of modern governance model Acceleration of Sika’s growth strategy 2
Slide 3: Transaction Structure
TRANSACTION STRUCTURE One comprehensive transaction Premium of CHF 754 million (23.3%) to compensate for control Implementation of the transaction in two steps: Sika acquires 6.97% stake for CHF 2.08 billion (for cancellation) After 2 years (lock-up), right of first refusal for 10.75% at a
Slide 4: Extraordinary Shareholders Meeting on June 11, 2018
EXTRAORDINARY SHAREHOLDERS MEETING ON JUNE 11, 2018 Cancellation of 6.97% shares by way of capital reduction Introduction of single class registered shares (“one share, one vote”) Share split 1:60 Remove opting-out Remove transfer restriction Discontinue Special Expert Committee 4
Slide 5: Financial Impact on Sika
FINANCIAL IMPACT ON SIKA Strong Balance Sheet with efficient capital structure Continued strong operating cash flow generation Ample flexibility to support future growth Transaction immediately EPS accretive 5
Slide 6: Saint-Gobain as Shareholder
SAINT-GOBAIN AS SHAREHOLDER Saint-Gobain holds 10.75% stake in Sika Fully supports introduction of “one-share, one-vote” Bound by lock-up, stand-still and offer obligations: lock-up (2 years) stand-still (up to 10.75% for 4 years, up to 12.875% for 6 years) Shares first to be offered to
Slide 7: Sika's Total Shareholder Return Outperforming Peers
SIKA’S TOTAL SHAREHOLDER RETURN OUTPERFORMING PEERS Total Shareholder Return (last 5 years) Sika created Sika 272% 3x Peer 1 Peer 2 Peer 3 Peer 4 Peer 5 Peer 6 the average Peer 7 Peer 8 shareholder return Peer 9 Average of the peer group Peer 10 90.4% 0% 50% 100% 150% 200% 250% 7
Slide 8: Sika – An Ongoing Success Story
SIKA – AN ONGOING SUCCESS STORY 8
Slide 9: Uninterrupted Operative Strength
UNINTERUPTED OPERATIVE STRENGTH NET SALES NET 7000 SALES 16.0% EBIT 1100 14.3% 16.0% 1000 13.8% % growth in local currencies as % of net sales 14.0% 6500 14.0% 900 12.3% 5.3% 9.4% 13.0% 6.2% 5.5% 9.0% 11.4% 12.0% 800 12.0% 6000 10.2% 700 10.0% 9.0% 10.0% 600 5500 7.6% 8.0% 8.0% 500 5000 400 6.0% 6.0
Slide 10: Excellent Track Record Since 2015
EXCELLENT TRACK RECORD SINCE 2015 - Successful Target Market concept Market Penetration - Megatrends driving growth - 217 new patents filed Innovation - 20 Global Technology Centers Emerging Markets - 27 new plants opened - 11 new national subsidiaries Acquisitions - 17 acquisitions in
Slide 11: Sika's Growth Strategy 2020 Confirmed
SIKA’S GROWTH STRATEGY 2020 CONFIRMED TO BE REVIEWED AND UPDATED IN 2019 MARKET PENETRATION 6 - 8% ANNUAL GROWTH 30 NEW PLANTS INNOVATION 105 NATIONAL SUBSIDIARIES EMERGING MARKETS 14 - 16% EBIT MARGIN PER YEAR ACQUISITIONS > 10% OPERATING FREE CASH FLOW PER YEAR VALUES > 25% ROCE PER YEAR 11
Slide 12: Sika's Market Potential
SIKA’S MARKET POTENTIAL LARGE AND GROWING MARKET SEGMENTS TOTAL MARKET SIZE 2017 2020 > CHF 70 BILLION CHF 80 BILLION INDUSTRY CONCRETE INDUSTRY CONCRETE WATER- FLOORING WATER- PROOFING FLOORING PROOFING ROOFING ROOFING SEALING & SEALING & BONDING BONDING REFURBISHMENT REFURBISHMENT 12
Slide 13: Sika Will Act as Market Consolidator
SIKA WILL ACT AS MARKET CONSOLIDATOR FRAGMENTATION OFFERS ACQUISITION OPPORTUNITIES CONSTRUCTION CHEMICAL MARKET 2017 > CHF 60 BILLION Sika Top 10 companies with a combined market share of 40% Other 13
Slide 14: Strong Outlook for 2018
STRONG OUTLOOK FOR 2018 CONTINUATION OF SUCCESSFUL GROWTH STRATEGY Strong growth continued in the first 4 months Sales increase of more than 10% expected with a sales target of CHF 7 billion in 2018 Volatile and rising raw material prices will continue to be a challenge Overproportional grow
Slide 15: Summary
SUMMARY Transfer of control premium to all shareholders Transaction immediately EPS accretive to all shareholders Acceleration of Sika’s growth strategy, review of targets 2020 and beyond Implementation of efficient capital structure Creation of modern governance model 15
Slide 16: Thank You for Your Attention
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Slide 17: Forward-Looking Statement
FORWARD-LOOKING STATEMENT This presentation contains certain forward-looking statements. These forward-looking statements may be identified by words such as ‘expects’, ‘believes’, ‘estimates’, ‘anticipates’, ‘projects’, ‘intends’, ‘should’, ‘seeks’, ‘future’ or similar expressions or by discussion o