Evonik. Power to create. Company presentation September 2015 - PowerPoint PPT Presentation

Evonik. Power to create. Company presentation September 2015

Table of contents 1 Evonik at a glance 2 Group strategy 3 Financials Q2 2015 4 Appendix September 2015 | Evonik company presentation | Evonik at a glance Page 2

One of the world leaders in specialty chemicals >15 1.9 80% of sales from #1-3 market positions billion € billion € adj. EBITDA total market capitalization achieved in 2014 >4% ~500 ~33,000 employees in more R&D projects driving average volume growth (CAGR) since 2009 1 innovation than 100 countries 1 Excluding Carbon Black and Real Estate September 2015 | Evonik company presentation | Evonik at a glance Page 3

Three specialty chemicals segments Sales Adj. EBITDA Margin ROCE € 12,917 m € 1,882 m 14.6% 12.5% Nutrition & Resource Performance Care Efficiency Materials Products for applications in the Polymer materials and intermediates Environment-friendly and consumer goods, animal nutrition mainly for the rubber and plastics energy-efficient system solutions and healthcare sectors industries € 4,075 m € 4,040 m € 3,827 m Sales Sales Sales € 847 m € 836 m € 325 m Adj. EBITDA Adj. EBITDA Adj. EBITDA Margin 20.8% Margin 20.7% Margin 8.5% Corporate / € 906 m € 69 m Sales Sales Services € 151 m - € 277 m Other Adj. EBITDA Adj. EBITDA 2014 financials restated September 2015 | Evonik company presentation | Evonik at a glance Page 4

Balanced and diversified portfolio End market split 1 Sales by region 2 15−20% 10−15% 5−10% < 5% Agriculture Renewable energies Paper and printing Other 2% Consumer goods and Paints and coatings personal care products Germany 22% Asia-Pacific 19% Metal and oil products Central and Electrical and electronics South America 6% Food and animal feed Pharmaceuticals Other industries Plastics and rubber Automotive and Other European mechanical engineering North America 18% Countries 33% Construction No dependency on single end markets; Strong European heritage, no end market exposure >20% focus on expansion into growth regions 1 Based on specialty chemicals segments’ 2014 sales 2 Consolidated Group sales 2014 September 2015 | Evonik company presentation | Evonik at a glance Page 5

Committed to create value Strengthening of Strategic and Clear commitment market leadership financial discipline by allocation of resources Proven track record of to deliver according to high growth active portfolio management sustainable growth opportunities Solid balance sheet and to increase profitability by development of tailor-made and innovative solutions disciplined use of funds together with customers Value creation for our shareholders September 2015 | Evonik company presentation | Evonik at a glance Page 6

Table of contents 1 Evonik at a glance 2 Group strategy 3 Financials Q2 2015 4 Appendix September 2015 | Evonik company presentation | Group Strategy Page 7

New corporate structure Enabling differentiated management of segments Strategic Management Holding • Three specialty chemicals segments as separate legal entities • Differentiated management of businesses tailored to specific needs • Higher degree of entrepreneurial freedom Nutrition & Care Resource Efficiency Performance Materials Growth Efficiency Investments Innovation M&A September 2015 | Evonik company presentation | Group Strategy Page 8

Levers for sustainable growth Combining internal and external growth Investments Innovation M&A • • • “Power to create” as part Focused investments into Acquisitions as additional of Evonik’s DNA high-growth end markets route for value creation and regions • • “Leading innovation” Sharpening of specialty • Disciplined and flexible initiative with ambition to chemicals portfolio approach in execution generate best-in-class • Proven track record of ideas for future products • Recently finished projects portfolio optimization and solutions according with increasing • Disciplined use of funds • earnings contribution Strong market and customer orientation for tailor-made solutions September 2015 | Evonik company presentation | Group Strategy Page 9

Investments Major projects finished in 2014, more underway  Plants currently Recently finished under construction investment projects Fumed silica & silanes platform Expansion C4 chain Capex ~ € 100 m Capex >250 m Start up 2017 Start up mid 2015 New silica plant Marl & Isophorone chain Capex > € 50 m Antwerp Capex > € 100 m Start up 2017 Start up Q2 2014 Xuzhou Essen South East of the US Silicone platform Oleochemicals plants Shanghai Capex > € 100 m Capex > € 100 m Start up 2017 China: Start up Q1 2014 Singapore Brazil: Start up Q1 2015 New silica plant Sao Paulo Capex ~ € 50 m Methionine plant Capex > € 500 m Start up 2016 Start up Q4 2014 Nutrition & Care Resource Efficiency Performance Materials September 2015 | Evonik company presentation | Group Strategy Page 10

Investments Capex returning to sustainable level after 2016 Capex spending (in € m) Growth capex by segment and region 1 Performance Materials up to 1,140 1,123 Nutrition & 1,100 Care 960 800-900 ~800 Resource Efficiency RoW Europe Asia 2012 2013 2014 2015 2016 Sus- D&A tainable level North America Total capex Growth capex Basis investments 1 After 2016 September 2015 | Evonik company presentation | Group Strategy Page 11

Innovation Strong market and customer orientation Transformational innovation (Creavis) • Centralized, mid-to- Technology / ~10% Products long-term R&D € 413 m new (+5%) 1 ~90% adjacent Core and adjacent business innovation • Decentralized, shorter-term R&D in established operating segments • Cross business, e.g. in industry teams Market / • Very close to Application customers (often joint established adjacent new R&D efforts) 1 R&D expenses 2014 (vs. 2013) September 2015 | Evonik company presentation | Group Strategy Page 12

Innovation Constant process and product innovation Specialty amines for gas scrubbing Silica in personal care products • Pretreatment of raw gases is inevitable to • Silica as environmentally friendly alternative transform raw natural gases into usable clean for microplastics (PE/PP) in exfoliants in gases personal care products; in line with trend to natural skin care and environmental friendly • New specialty amines act as scrubbing agents products removing acid gas components far more effectively than established amines • High-purity silica delivering abrasion effect • Noticeable increase in performance, output (e.g. in shower gels and peelings) plus and service life of plants absorbing liquid active ingredients or scents • Evonik in talks with other large oil & gas • Major international personal care companies companies in SEA, MENA and South America have already started to switch to silica September 2015 | Evonik company presentation | Group Strategy Page 13

Proven history of efficiency improvements Improving cost position since 2009 2009 2010 2011 2012 2013 2014 2015 2016 Operational excellence (e.g. production processes), Procurement € 500 m  On Track Measures with € 500 m Operational excellence savings potential (e.g. production processes), > € 400 m already in by end of 2016 Procurement implementation On Track 2.0 Streamlining of € 230 m Savings of ~ € 40 m administrative functions already realized at by end of 2016 worldwide year-end 2014 Administration Excellence September 2015 | Evonik company presentation | Group Strategy Page 14

Aspiration level: Adj. EBITDA of > € 3 bn and an attractive premium on cost of capital > € 3 bn ~ € 0.6 bn € 2.0 bn CAGR >8% Underlying Efficiency Growth Acquisitions / Adj. EBITDA Adj. EBITDA Growth programs (net) Investments Divestments 2013 2018 September 2015 | Evonik company presentation | Group Strategy Page 15

Table of contents 1 Evonik at a glance 2 Group strategy 3 Financials Q2 2015 4 Appendix September 2015 | Evonik company presentation | Financials Q2 2015 Page 16

Highlights Q2 2015 Another strong quarter; outlook raised Adj. EBITDA of € 661 m outperformed strong Q1 level with all three chemical segments delivering sequentially higher earnings Accelerating operational performance Outlook raised: sales of around € 13.5 bn and adj. EBITDA of around € 2.4 bn expected for FY 2015 New production site for precipitated silica in the US focusing on green-tire applications (completion 2017) Consistent execution of Expanding innovation capabilities strategy Completion of Vivawest divestment: remaining 10.3% stake sold to RAG AG for around € 400 m September 2015 | Evonik company presentation | Financials Q2 2015 Page 17