Kepler Cheuvreux 16th Swiss Seminar

Transcription

1 Kepler Cheuvreux 16th Swiss Seminar 26 MARCH 2015 Patrick Jany, CFO

2 Key Figures Full-Year 2014 Patrick Jany, CFO

3 3 Kepler Cheuvreux; 16th Swiss Seminar Full-year 2014 solid results achieved FY 2014 vs. FY 2013, all figures continuing operations Sales +5% sales growth in local currencies, +1% in CHF EBITDA* EBITDA* growth of 6% in LC; 1% in CHF Margin rises to 14.2% from 14.1% Net income CHF 235 million on higher taxes from CHF 323 million Net income before tax: +10% to CHF 379 million from CHF 345 million Dividend proposal CHF 0.40/share from CHF 0.36/share from capital contribution reserves * Before exceptional items

4 4 Kepler Cheuvreux; 16th Swiss Seminar Sales growth driven by volumes headwinds from FX in the first nine months all figures continuing operations Sales mix FY 2014 Sales growth in local currencies Volume 4% Price 1% Acq./Div. 0% Germany* 809 / 5% North America / +3% Asia / Pacific / +9% China 519 / +9% Currency -4% Organic sales growth in LC driven by 4% higher volumes Heterogeneous regional growth patterns. Strong double-digit growth in LATAM despite Brazil, good growth in Asia / Pacific Europe further softened; Germany lower due to pruning of low margin products in Care Chemicals and weak aviation business Mature Markets Emerging Markets Europe* / -2 % Middle East & Africa 461 / +7% Latin America 984 / +18% Sales FY 2014: CHF m Brazil 405 / +4% * excluding impact from Care Chemicals portfolio measures: Europe +0% / Germany +0%

5 5 Kepler Cheuvreux; 16th Swiss Seminar Steady growth in all Business Areas in a challenging business environment Full-year 2014 Sales Change EBITDA* margin Business Area CHF m % LC FY 2014 FY 2013 Care Chemicals** Catalysis & Energy Natural Resources Plastics & Coatings Total Group continuing*** * before exceptional items, in % of sales ** excluding impact from Care Chemicals portfolio measures: +3% in l.c. *** including corporate costs

6 Focus On Performance, Growth & Innovation Patrick Jany, CFO

7 7 Kepler Cheuvreux; 16th Swiss Seminar Priorities 2015 moving along the profitable growth path with focus on performance, growth, innovation 2015 KEY ELEMENTS PERFORMANCE Performance Continued cost reduction and efficiency Clariant Excellence Implementing new ways of doing business 2015 GROWTH Exploit growth markets in Asia Seize opportunities in developed and other emerging markets Innovation Growth INNOVATION Strengthen organization and processes Develop innovation pipeline Promote communication and cooperation Target: Growth, higher EBITDA margin and improved cash flow

8 8 Kepler Cheuvreux; 16th Swiss Seminar Performance higher profitability expected from cost efficiency and growth investments KEY METRICS IMPROVED Cost discipline across the company Efficient delivery of business services Avoiding remnant costs from divestments Investments into innovation and capex projects 2015: GLOBAL BUSINESS SERVICES Shared Service Centers in Mumbai and Lodz. Take better advantage of company s global footprint and identify more cost-efficient solutions Operational Excellence Commercial Excellence Innovation Excellence 1 Intensify Lean Management 2 Explore Growth 3 Accelerate Business Transformation

9 9 Kepler Cheuvreux; 16th Swiss Seminar Growth selective adjustments of portfolio and investing into future growth markets EXAMPLE INDIA After acquisition of Plastichemix Industries Clariant now #1 Masterbatches producer in India Expansion of Pigment production in India (Roha, Cuddalore) New regional headquarters in Mumbai opened in June including regional innovation center for over 100 employees EXAMPLE NORTH AMERICA Clariant s historic underrepresentation creates profitable growth opportunities across virtually all BU s ~50% of 2015 NORAM sales will be from businesses owned less than 5 years Cutting-edge Polypropylene Catalyst production in Louisville (KY, USA) Expansion in Industrial Home Care in Clear Lake (USA) 54% of investments in emerging markets and North America (36% in 2013) Emerging markets earn 47% of group sales (37% in 2005)

10 10 Kepler Cheuvreux; 16th Swiss Seminar Innovation active management of innovation portfolio drives growth and profitability TARGET: 1-2% CONTRIBUTION FROM INNOVATION TO SALES GROWTH Sales at maturity: CHF 1.8 billion increase from CHF 540 million in active projects, thereof 63 prioritized as Class 1 projects (as of June 2014) INNOVATION FIGURES 1050 People in R&D (end of 2014) 8 Global R&D Centers > 50 Technical Application Centers 3.5% of Group sales m of R&D expenditures in CHF NEW PRODUCT HIGHLIGHTS FROM CLARIANT Glucamides: sugar-based surfactants, multimarkets applications: Personal Care (Glucotain ); Industrial & Homecare (GlucoPure ); Crop Solutions (Synergen GA); Oil Services Heat Generating Material (HGM) concept developed with technology partner CB&I increases the yield in on-purpose olefin production units by several percent and reduces the carbon emissions by several tons per year Polypropylene Catalyst a new market opportunity for Clariant to be launched in 2016 >7 000 Patents >130 Scientific collaborations

11 11 Kepler Cheuvreux; 16th Swiss Seminar Creating additional value through Sustainability business benefits and Clariant s approach SUSTAINABILITY AT CLARIANT»Clariant commits itself to ethical and sustainable operation and Development in all business activities according to Responsible Care and Clariant s own Code of Conduct. Clariant strives for a business culture of continuous improvement as well as for sustainable competitiveness and top performance in consideration of Clariant s ethical standards.«external RECOGNITION OF SUSTAINABILITY PERFORMANCE GLOBAL VOLUNTARY INITIATIVES AND PROGRAMS Essential to achieve company targets Support profitable growth Create added value for stakeholders Anticipate and mitigate risk SUSTAINABILITY IN THE SUPPLY CHAIN

12 12 Kepler Cheuvreux; 16th Swiss Seminar Appreciation of Swiss franc basically a translation impact as transactional effects are fairly neutral TRANSACTIONAL IMPACT OF CURRENCIES Since 2011 Swiss franc cost base reduced by more than 50% through to 4% of cost ~ CHF 250 million Favorable effect of European manufacturing base Remnant risk through volatile emerging market currencies NATURAL HEDGE FURTHER IMPROVED 54% of investments in emerging markets and North America to further improve the natural hedge, i.e: Polypropylene Catalyst facility in USA, Industrial Home Care expansion, USA. Bolt-on acquisitions in Asia etc.

13 Outlook Patrick Jany, CFO

14 14 Kepler Cheuvreux; 16th Swiss Seminar Outlook 2015 heterogeneous macroeconomic environment Macroeconomic view Clariant expects an ongoing challenging environment characterized by an increased volatility in commodity prices and currencies The combined effect of the appreciation of the Swiss franc with the weakening of the euro will impact Clariant s sales and profitability in absolute terms but will be fairly neutral in terms of relative margins In the emerging markets the economic environment is expected to remain favorable but at a lower level and with increased volatility; moderate growth expected in the United States, however, growth in Europe is expected to remain weak

15 15 Kepler Cheuvreux; 16th Swiss Seminar Outlook 2015 further progress in sales and profitability 2015 Clariant will further progress in local currency and profitability Clariant will focus on profitably growing the four Business Areas and on cost efficiency For full-year 2015, Clariant expects low to mid-single digit sales growth in local currencies, an EBITDA margin before exceptional items above full-year 2014 and an increased cash flow generation and beyond 2015 will mark a further progress towards our mid-term target of becoming a leading company for specialty chemicals, achieving a position in the top tier of the industry. This corresponds to an EBITDA margin before exceptional items range of 16% to 19% and a return on invested capital (ROIC) above peer group average

16 16 Kepler Cheuvreux; 16th Swiss Seminar

17 Back-up Slides Patrick Jany, CFO

18 18 Kepler Cheuvreux; 16th Swiss Seminar Clariant s products and services are grouped into four Business Areas Care Chemicals Catalysis & Energy Natural Resources Plastics & Coatings Business Area (BA) Care Chemicals comprises the Industrial & Consumer Specialties (ICS) Business Unit, food additives as well as the future Industrial Biotechnology business. It demonstrates a clear focus on highly attractive, high margin, and low cyclicality segments. The BA follows a lifestyle-driven megatrend and strengthens Clariant s image of being a supplier of green and sustainable products. Business Area Catalysis & Energy develops, manufactures, and sells a wide range of catalyst products for the chemical, fuel and automotive industries, as well as producing materials for electric vehicles and energy storage systems. The BA is the smallest within Clariant but is highly profitable with high growth rates and low cyclicality. BA Natural Resources, comprising BUs Oil & Mining Services and Functional Minerals, is characterized by high growth and low cyclicality as well as strong megatrend orientation. Main drivers are the rising demand for highvalue added specialty chemicals used in the oil, mining, food and packaging industries, and increased consumption of oil, gas and base metals, driven by the fast-growing economies. BA Plastics & Coatings comprises the BUs Additives, Pigments and Masterbatches. The BA has a large exposure to Europe and, as such, is subject to lower growth and to economic cycles. Main drivers are the increasing use of plastics with tailormade properties in applications such as mobile phones, cars, construction, as well as the rising consumption of plastics in line with increased wealth.

19 19 Kepler Cheuvreux; 16th Swiss Seminar Selective investments projects coming on stream in the next 1-2 years PROJECT BUSINESS LOCATION INVESTMENT (M CHF) ON STREAM Polypropylene Catalyst production Catalysts Louisville (KY), USA > Glucamide production Consumer Care Gendorf, Germany Industrial Home Care expansion Ind. & Cons. Spec. Clear Lake, USA Licocene Performance Polymer Additives Höchst, Germany < Industrial Home Care expansion Ind. & Cons. Spec. Dayabay, China < High Performance Pigments Pigments Zhenjiang, China Additives project Additives Zhenjiang, China Focused investments on growth areas based on step-change innovations to avoid overcapacities

20 20 Kepler Cheuvreux; 16th Swiss Seminar Key financials full year Full-year results (continuing operations) CHF m % of sales CHF m % of sales Sales % % Local currency growth (LC) 5% - Organic growth rate* 5% - Acquisitions/Divestments 0% Currencies -4% Gross profit % % EBITDA before exceptionals % % EBITDA % % Operating income before exceptionals % % Operating income % % Net result from continuing operations % % Net income ** Operating cash flow Sales from discontinued operations Net result from discontinued operations * Organic growth: volume and price effects excluding the impact of changes in foreign currency exchange rates and acquisitions/divestments ** Total Group, including discontinued operations

21 21 Kepler Cheuvreux; 16th Swiss Seminar Cash flow full year Full-year results CHF m CHF m Net income Depreciation, amortization and impairment Other Payments for restructuring Operating cash flow before working capital changes Changes in working capital and provisions Operating cash flow Cash flow from investing activities thereof: property, plant and equipment thereof: changes in current financial assets and near cash assets thereof: acquisitions, disposals and other Cash flow before financing

22 22 Kepler Cheuvreux; 16th Swiss Seminar Financial result full year Full-year results CHF m CHF m Interest income Other financial income 3 3 Total financial income Interest expenses thereof: interest on non-current provisions -6-4 thereof: interest on post-employment benefit obligations Other financial expenses Total financial expenses Currency result, net Total financial costs thereof reported under discontinued operations 2 31 Total financial costs (continuing operations)

23 23 Kepler Cheuvreux; 16th Swiss Seminar Sales and EBITDA margins by Business Area full year Full year results Business Area Sales EBITDA* EBITDA margin* CHF m % LC % of Group FY/14 FY/13 Care Chemicals Catalysis & Energy Natural Resources Plastics & Coatings Total continuing Sales in % of Group EBITDA Plastics & Coatings 42% Natural Resources 21% Care Chemicals 25% Catalysis & Energy 12% Plastics & Coatings 37% Natural Resources 20% Care Chemicals 26% Catalysis & Energy 17% * before exceptional items

24 24 Kepler Cheuvreux; 16th Swiss Seminar Growth driven by pricing, masked by deconsolidation all figures continuing operations Sales mix Q Sales growth in local currencies Price 2% China 136 / 12% Volume 0% Acq./Div. 0% Germany* 192 / 5% North America 286 / +2% Asia / Pacific 389 / +4% Currency -1% Organic sales growth in LC driven by 2% higher prices Heterogeneous regional growth patterns. Strong double-digit growth in LATAM despite Brazil, good growth in Asia / Pacific with sales decline in China Europe further softened; Germany lower due to pruning of low margin products in Care Chemicals Mature Markets Emerging Markets Europe* 524 / 4% Middle East & Africa 110 / 9% Latin America 277 / +20% Sales Q4 2014: CHF m Brazil 103 / 0% * excluding impact from Care Chemicals portfolio measures: Europe 0% / Germany +5%

25 25 Kepler Cheuvreux; 16th Swiss Seminar Q4 EBITDA* rose, margin above previous year all figures continuing operations Gross margin improved compared to the prior-year period Sales prices +2% / raw material costs -1% year-on-year Sales prices 0% / raw material costs -2% sequentially Gross margin 28.8% 28.2% EBITDA* and EBITDA* margin decreased slightly EBITDA* decreased due to exceptional previous year high basis in Natural Resources Improved or stable EBITDA* margin in Care Chemicals, Catalyst & Energy and Plastics & Coatings EBITDA* CHF m EBITDA* margin % 15.0% Adj. EPS decreased to CHF 0.30/share from CHF 0.32/share in Q Net income from continuing operations improved to CHF 133 m from CHF 85 m Higher net income mainly due to gain from land sale in India Adjusted EPS CHF/share * before exceptional items Q Q4 2013

26 26 Kepler Cheuvreux; 16th Swiss Seminar Cash flow generation picked up in Q4. Net working capital clearly below 20% Positive cash flow from operations Pronounced seasonal working capital reduction NWC/sales ratio at 19.1% compared to 17.1% at the end of Q Operating cash flow CHF m Cash-out for restructuring decreased to CHF 24 million from CHF 35 million Cost incurred in smaller projects in the businesses and to streamline and optimize the service organization -24 Restructuring -35 cash-out CHF m Net debt at CHF million compared to CHF million at year-end 2013 Net debt reduction through operating cash flow generation in the second half Net debt level in-line with target of CHF 1.3 billion Net debt CHF m all figures continuing operations Q Q4 2013

27 27 Kepler Cheuvreux; 16th Swiss Seminar Business Area performance full year Care Chemicals Catalysis & Energy Sales in CHF m EBITDA bef. exc. in CHF m Sales in CHF m EBITDA bef. exc. in CHF m 2014 Change (LC) Change (LC) Change (LC) Change (LC) % % % % 17.1% 16.8% 23.5% % Natural Resources Plastics & Coatings Sales in CHF m EBITDA bef. exc. in CHF m Sales in CHF m EBITDA bef. exc. in CHF m 2014 Change (LC) Change (LC) Change (LC) Change (LC) % % +5% % % % 14.0% %

28 28 Kepler Cheuvreux; 16th Swiss Seminar Key financials fourth quarter Fourth quarter results CHF m % of sales CHF m % of sales Sales % % Local currency growth (LC) 2% - Organic growth rate* 2% - Acquisitions/Divestments 0% Currencies -1% Gross profit % % EBITDA before exceptionals % % EBITDA % % Operating income before exceptionals % % Operating income % % Net result from continuing operations % % Net income Operating cash flow Sales from discontinued operations Net result from discontinued operations -1-5 * Organic growth: volume and price effects excluding the impact of changes in foreign currency exchange rates and acquisitions/divestments 1 Total Group, including discontinued operations

29 29 Kepler Cheuvreux; 16th Swiss Seminar Cash flow fourth quarter Fourth quarter results CHF m CHF m Net income Depreciation, amortization and impairment Other Payments for restructuring Operating cash flow before working capital changes Changes in working capital and provisions Operating cash flow Cash flow from investing activities thereof: property, plant and equipment thereof: changes in current financial assets and near cash assets thereof: acquisitions, disposals and other Cash flow before financing

30 30 Kepler Cheuvreux; 16th Swiss Seminar Financial result fourth quarter Fourth quarter results CHF m CHF m Interest income 2 3 Other financial income 1 1 Total financial income 3 4 Interest expenses thereof: interest on non-current provisions -3-1 thereof: interest on post-employment benefit obligations -5-5 Other financial expenses -3-3 Total financial expenses Currency result, net -9-9 Total financial costs thereof reported under discontinued operations 0 6 Total financial costs (continuing operations)

31 31 Kepler Cheuvreux; 16th Swiss Seminar Sales and EBITDA margins by Business Area fourth quarter Fourth quarter results Business Area Sales EBITDA* EBITDA margin* CHF m % LC % of Group Q4/14 Q4/13 Care Chemicals Catalysis & Energy Natural Resources Plastics & Coatings Total continuing Sales in % of Group EBITDA Plastics & Coatings 38% Care Chemicals 25% Plastics & Coatings 28% Care Chemicals 30% Natural Resources 22% Catalysis & Energy 15% Natural Resources 20% Catalysis & Energy 22% * before exceptional items

32 32 Kepler Cheuvreux; 16th Swiss Seminar Business Area performance fourth quarter Care Chemicals Catalysis & Energy Sales in CHF m EBITDA bef. exc. in CHF m Sales in CHF m EBITDA bef. exc. in CHF m 2014 Change (LC) Q Change (LC) Q Change (LC) Q Change (LC) Q % % 238 0% 245 0% 20.4% 18.1% 24.8% % Natural Resources Plastics & Coatings Sales in CHF m EBITDA bef. exc. in CHF m Sales in CHF m EBITDA bef. exc. in CHF m 2014 Change (LC) Q Change (LC) Q Change (LC) Q Change (LC) Q % % -26% % % % 12.6% %

33 33 Kepler Cheuvreux; 16th Swiss Seminar Debt maturity profile as of 31 December 2014 Liquidity Maturities of Financial Debt in CHF million Derivatives Uncommitted & other loans / NWC facilities Long term loans Certificate of Indebtedness EUR Bond CHF Bond Cash* Cash* * Including near cash assets and financial instruments with positive fair values

34 34 Kepler Cheuvreux; 16th Swiss Seminar Sales and cost structure* Global sales distribution in % Global cost distribution in % CHF 0% JPY 3% Emerging markets 18% EUR 41% CHF 4% JPY 3% Emerging markets 15% EUR 46% USD 38% USD 32% *These distributions represent an approximation to total cash in- and out-flows and are closely linked to transaction exposures for FY 2014; Including discontinued operations.

35 35 Kepler Cheuvreux; 16th Swiss Seminar Top 20 chemicals in percentage of total raw material costs* Approx. 45 chemicals account for 50% of material costs Top 5 Chemicals 1 Ethylene 2 Ethylene oxide 3 Propylenglycol 4 Polyethylene 5 Titanium dioxide Top 6-20 Chemicals 6 Propylene oxide 7 Phthalocyanine copper salt 8 Palladium 9 Tallow fatty acid 10 Acetic acid 11 Naphtha 12 Sodium hydroxide 13 Carbon Black 14 Dichlorobenzidine dihydrochloride 15 Bentonite 16 Alkyl benzene 17 Fatty alcohol 18 Ferric oxide 19 Polypropylene 20 Alkyldimethyl amines 19% 11% Top 5 Top 6-20 Other 70% *As of 31 December 2014

36 36 Kepler Cheuvreux; 16th Swiss Seminar Calendar of upcoming corporate events 31 March 2015 Annual General Meeting, Basel 29 April July October 2015 First Quarter 2015 Results Conference Call Half Year 2015 Results Conference Call Nine Months 2015 Results Conference Call

37 37 Kepler Cheuvreux; 16th Swiss Seminar IR contacts Dr. Siegfried Schwirzer Deputy Head Investor Relations Phone Mobile Marco Ferraro Investor Relations Officer Phone Mobile Edith Schwab Phone Mirjam Grieder Phone

38 38 Kepler Cheuvreux; 16th Swiss Seminar Our Publications ipad App: Factbook:

39 39 Kepler Cheuvreux; 16th Swiss Seminar Disclaimer This presentation contains certain statements that are neither reported financial results nor other historical information. This presentation also includes forward-looking statements. Because these forward-looking statements are subject to risks and uncertainties, actual future results may differ materially from those expressed in or implied by the statements. Many of these risks and uncertainties relate to factors that are beyond Clariant s ability to control or estimate precisely, such as future market conditions, currency fluctuations, the behavior of other market participants, the actions of governmental regulators and other risk factors such as: the timing and strength of new product offerings; pricing strategies of competitors; the Company's ability to continue to receive adequate products from its vendors on acceptable terms, or at all, and to continue to obtain sufficient financing to meet its liquidity needs; and changes in the political, social and regulatory framework in which the Company operates or in economic or technological trends or conditions, including currency fluctuations, inflation and consumer confidence, on a global, regional or national basis. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this document. Clariant does not undertake any obligation to publicly release any revisions to these forward-looking statements to reflect events or circumstances after the date of these materials.