BOXBOARD EUROPE GROUP OVERVIEW

Transcription

1 BOXBOARD EUROPE GROUP OVERVIEW ANALYST AND INVESTOR DAY SEPTEMBER 25, 2015

2 IGNAZIO CAPUANO 2 President & CEO of Reno De Medici SpA CEO since 2004 With RDM since 2003 In paper industry since 1991

3 BOXBOARD EUROPE GROUP SNAPSHOT LTM 06/30/2015 (M ) (M CAN$) Sales 575 $807 EBITDA 45 $64 EBITDA Margin 8% 8% Total Assets 457 $636 OPERATING PLATFORM MANUFACTURING Units 7 Machine/Lines 9 Capacity ~1,100 short tons Most of the industry is not integrated in Europe 3

4 CORPORATE STRUCTURE Cascades Inc. 100% 57.61% Cascades S.A.S. 100% Reno De Medici SpA Sales: 458 M EBITDA: 40 M La Rochette Mill Sales: 118 M EBITDA: 5 M 4 Note: LTM 06/30/2015 numbers

5 TURNAROUND STORY Major financial restructuring Redundant assets disposals (non-core, real estate) Business combination between Reno and Cascades Consolidating and Focusing Production capacity rationalization recycled and virgin Update top-of-class facilities Broader market presence Sales structure improvement 5

6 STEADY GROWTH (M ) EBITDA & EBITDA Margin % 6% 7% 9% 8% LTM Q Energy credits totaling 4M in 2013, 6M in 2014 and 2M in LTM Q2-2015

7 STRONG PRODUCTION PLATFORM CAPACITY ( 000 s.t.) MILL COUNTRY PRODUCTS Villa Santa Lucia Italy Liner/WLC Santa Giustina Italy WLC Arnsberg Germany Liner/GD/WLC Blendecques France WLC Ovaro Italy Specialty: OG/GK Almazan (for sale) Spain WLC Total Geographically diversified with 3 top-of-class facilities

8 COMPLEMENTARY VIRGIN PRODUCTION 1 st presence by Cascades in Europe in 1985 Total capacity: ~175,000 s.t. 2 board machines (#2 & #3) GC1-GC2 grades (220 to 440 g/m 2 ) Mechanical pulp mill Integrated with sheeting capacity 8

9 EXTENSIVE EUROPEAN PLATFORM M M Well-positioned to service Central Europe M M M M M 9 M M Manufacturing Recycled grades Manufacturing Virgin grades

10 WESTERN EUROPE IS CORE MARKET 1H 2015 Recycled Grades Sales Breakdown by Geography Italy 38% France Germany, Austria and Switzerland Rest of Western Europe Eastern Europe 8% 90% in Continental Europe 16% Overseas 13% 19% 6% 10

11 STRONG MARKET POSITION WLC + FBB Capacity MAYR MELNHOF METSÄBOARD RDM + CASCADES STORA ENSO KOTKAMILLS WEIG KARTON IP BUCHMANN SMURFIT KAPPA HOLMEN FISKEBY OTHERS ( 000 m.t.) #2 producer of recycled boxboard in Europe WLC FBB 11 Source: Based on public reports and Cascades estimates 1 Including the new folding boxboard machine at the Husum Mill with a total capacity of 400,000 m.t. starting up in Q Excluding the Barcelona WLC Mill sold in Q Including the conversion to FBB of paper machine #2 at the Kotka mill in Finland

12 WIDE END-USERS PORTFOLIO Breakdown of 2014 sales by end-user Others 18% Merchant sales 13% Food & Food services 49% Non-Food 20% 12

13 VIRGIN BOXBOARD ACTIVITIES France 47% Italy 19% Spain 12% Germany 7% UK Others 5% 10% Pharmacy 42% Food/ Beverage 35% Others 10% France is the main market Strong position in Italy and Spain as well Germany is continuously growing since the closure of Djupafors 13

14 STRATEGIC FOCUS GROWTH AREAS Strengthen presence in growing markets (i.e. Eastern Europe) Continue to reduce leverage to provide flexibility PRODUCTIVITY INITIATIVES Strategic investment to reduce costs and improve quality and margins (energy, automation and capacity creep) Increase synergies between our recycled and virgin platforms IT upgrades 14

15 INCREASE EASTERN EUROPE PRESENCE 1H 2015 Recycled Grades Sales Breakdown by Geography 73% 19% 8% Build on our established presence to grow in Eastern Europe Continue to be less reliant on overseas sales Western Europe Eastern Europe Overseas 15

16 INCREASE SYNERGIES BETWEEN OUR TWO PLATFORMS Continue to increase coordination undertaken over the last few years Single sales organization for all Cascades and Reno De Medici cartonboard products Optimize purchasing to capture economies of scale 16

17 REDUCE LEVERAGE TO MAINTAIN FLEXIBILITY (M ) Net Financial Debt Reno De Medici ,0x 4,0x 3,0x 2,0x 1,0x 0,0x Net financial debt Net debt/ebitda multiple : as reported LTM Q2-2015: excluding specific items and discontinued operations

18 REDUCE COSTS TO IMPROVE MARGINS EBITDA Margin 1 (%) /30/2015 YTD Mayr-Melnhof (MM Karton Division) 11% 8% Metsäboard (Cartonboard Division) 13% NA Average 12% 8% Boxboard Europe Group 8% 9% Rationalization achieved in the asset portfolio Investments in core assets to improve efficiency and reduce costs Benefits expected over the coming years, especially in a context of lower energy costs Will help to further increase operating margins 18 1 Based on public reports and Cascades estimates

19 QUESTIONS 19

20 20 NOTES