Holcim Ltd · SIX:HOLN
Holcim — Investor Day (2021)
21 slides from Holcim's investor day presentation, 2021
Slide 1: Delivering Superior Performance
DELIVERING SUPERIOR PERFORMANCE CAPITAL MARKETS DAY 2021 GÉRALDINE PICAUD / CHIEF FINANCIAL OFFICER MARKUS UNTERNÄHRER / HEAD OF TREASURY
Slide 2: Agenda
AGENDA Financial targets 2022 over-achieved one year in advance 2
Slide 3: Strategy 2022 - Building for Growth
STRATEGY 2022 - “BUILDING FOR GROWTH” WE DELIVERED WHAT WE PROMISED ONE YEAR IN ADVANCE STRATEGY 2022 2021 OUTLOOK NET 3% - 5% LFL SALES P.A. AT LEAST RECURRING EBIT 7% LFL P.A. CASH CONVERSION > 40% ROIC > 8% LEVERAGE BELOW 2x 3
Slide 4: Financial targets 2022 over-achieved one year in advance: growth and profitability
FINANCIAL TARGETS 2022 OVER-ACHIEVED ONE YEAR IN ADVANCE GROWTH ACHIEVED DESPITE COVID, RECORD PROFITABILITY NET SALES RECURRING EBIT > 3% > 8.5% LFL p.a. on LFL p.a. on average average >22% +5% +3% >9% +9% -6% +6% -2% CHF in Bn CHF in Bn 27.0 27.5 26.7 23.1 26.3 3.7 3.8 4.1 3.7 4.6 2017 2018 2019 2
Slide 5: Improved free cash flow generation, cash conversion > 40%
FINANCIAL TARGETS 2022 OVER-ACHIEVED ONE YEAR IN ADVANCE IMPROVED FREE CASH FLOW GENERATION, CASH CONVERSION > 40% FREE CASH FLOW 5% 58% 49%58% >40% 49% 28% 28% 28% 28% CHF in Bn 1.7 1.7 3.0 3.2 2017 2018 2019 2020 20211 Free Cash-flow % Cash conversion 1 Based on FY 2021 company collected consensus
Slide 6: Continuous savings in non-operational costs
FINANCIAL TARGETS 2022 OVER-ACHIEVED ONE YEAR IN ADVANCE CONTINUOUS SAVINGS IN NON-OPERATIONAL COSTS CHF in m Net financial expenses Effective tax rate 1 981 878 712 623 ~600 31% 28% 26% 25% ~25% 2017 2018 2019 2020 2021 2017 2018 2019 2020 2021 2017 2018 2019 2020 2021 Restructuring, litigations an
Slide 7: Value created through bolt-on and Firestone disciplined acquisitions
FINANCIAL TARGETS 2022 OVER-ACHIEVED ONE YEAR IN ADVANCE VALUE CREATED THROUGH BOLT-ON AND FIRESTONE DISCIPLINED ACQUISITIONS BOLT-ON FIRESTONE Roofing Systems 28 Bolt-on acquisitions completed to date since start of Closed March 31st 2021 Strategy 2022 USD 1.8bn Sales in 2020 Mainly Aggregates and
Slide 8: Divestments of USD 4.1 bn achieved
FINANCIAL TARGETS 2022 OVER-ACHIEVED ONE YEAR IN ADVANCE DIVESTMENTS OF USD 4.1 BN ACHIEVED ENTERPRISE DIVESTMENT VALUE 100%, YEAR USD m INDONESIA 2019 1’750 Total divestments EV = USD 4.1 bn MALAYSIA 2019 990 SINGAPORE 2019 68 Divestments 2019-2021 EV = USD 3.1 bn MALDIVES 2020 9 INDIAN OCEAN 2021
Slide 9: Balance sheet strengthened and capital efficiency achieved
FINANCIAL TARGETS 2022 OVER-ACHIEVED ONE YEAR IN ADVANCE BALANCE SHEET STRENGTHENED AND CAPITAL EFFICIENCY ACHIEVED LEVERAGE RATIO ROIC 2.4x 2.2x 1.5x 1.4x <2x 5.8% 6.5% 7.4% 7.4% >8% 2017 2018 2019 2020 2021 2017 2018 2019 2020 2021 Credit Rating from BBB Negative Outlook to BBB Positive Outlook Do
Slide 10: Agenda: KPI 2025
AGENDA 6 & KPI 2025 do HOLcIM
Slide 11: KPI 2025 Best in Class
KPI 2025 BEST IN CLASS Accelerate growth in Solutions & Products business segment to reach 30% of the Group’s Net Sales by 2025 Solutions & Products’ growth to be executed and funded by M&A SUSTAINABILITY at the core of our capital allocation Financial KPI Best in Class 11
Slide 12: Investments to fuel sustainable growth
KPI 2025 INVESTMENTS TO FUEL SUSTAINABLE GROWTH 2022 – 2025 Fuel Growth & Transformation Strategic acquisitions in Solutions & Acceleration in Products to reach synergistic Bolt-on 30% of total Group’s Net Sales by 2025 Disciplined investments with > rapid synergy implementation to drive profitabili
Slide 13: Divestments to fund strategic acquisitions
KPI 2025 DIVESTMENTS TO FUND STRATEGIC ACQUISITIONS 2022 – 2025 Value Accretive Divestments Prioritize growth Exit non-strategic business segments markets while reducing CO2 footprint Divestment proceeds used to fund strategic acquisitions > while maintaining a solid Achieve attractive Continuous ba
Slide 14: Accelerating green growth and delivering superior performance
KPI 2025 ACCELERATING GREEN GROWTH AND DELIVERING SUPERIOR PERFORMANCE Accelerate Growth in Net Sales Recurring Solutions & Products Growth EBIT Growth 30% 3% - 5% Over Proportional TO NET SALES A N N U A L LY IN % OF GROUP NET SALES G R O W T H A N N U A L LY Sustainability Cash Net Financial ROIC
Slide 15: Agenda: Sustainability at the core of what we do
AGENDA Sustainability at the core of what we do 15
Slide 16: ESG targets 2025 in finance
SUSTAINABILITY AT THE CORE OF WHAT WE DO ESG TARGETS 2025 IN FINANCE COMMITMENT TO > 40% OF S U S TA I N A B L E F I N A N C I N G B Y 2 0 2 5 FURTHER IMPROVEMENT IN ESG R AT I N G S GREEN CAPEX INCREASED TO > CHF 0.5 BN by 2025 16
Slide 17: > 40% sustainable financing by 2025
SUSTAINABILITY AT THE CORE OF WHAT WE DO > 40% SUSTAINABLE FINANCING BY 2025 SYNDICATED EUR 3BN RCF 1 EUR 3 bn syndicated credit line linked to Climate and Safety. Cost of facility will depend on achievement of annual targets SUSTAINABILITY LINKED BONDS 2 EUR 850 m issued in November 2020 & USD 100
Slide 18: Holcim's focus on ESG recognized by major agencies
SUSTAINABILITY AT THE CORE OF WHAT WE DO HOLCIM’S FOCUS ON ESG RECOGNIZED BY MAJOR AGENCIES Holcim achieved Holcim achieved Holcim recognized as a Upgraded ESG rating of ‘A’ Highest rating of ‘A1+’ Global Climate Leader Top 19% ranking within Top 2% ranking worldwide Entering the CDP’s prestigious C
Slide 19: Allocating more to Green Capex
SUSTAINABILITY AT THE CORE OF WHAT WE DO ALLOCATING MORE TO GREEN CAPEX Process Decarbonization Green Capex Clean Energy Green Capex allocation Carbon Efficient increased year on year Construction Circular Economy By allocating more Capex to Green projects, we will further Biodiversity, Air boost re
Slide 20: In a nutshell: sustainable growth achieved with superior performance
IN A NUTSHELL SUSTAINABLE GROWTH ACHIEVED WITH SUPERIOR PERFORMANCE TA R G E T S 2 0 2 2 O V E R - A C H I E V E D READY FOR THE NEXT CHAPTER OF GROWTH WITH FOCUS ON S U S TA I N A B I L I T Y KPI 2025 BEST IN CLASS 20
Slide 21: Holcim
HOLCIM