July 2017 Investor Presentation Kemira – Targeting for profitable growth • Kemira today (slides # 2-14) • Latest news and financials (# 15-33) • Pulp & Paper (# 34-39) Investor presentation • Industry & Water (# 40-48) • Appendix (# 49-54)
Kemira Capital Markets Day 2017 at Haberdashers’ Hall, 18 W Smithfield, London EC1A 9HQ Thursday, September 21, 2017 To register for the event please follow: Kemira CMD 2017 Jari Rosendal Petri Castrén Program (UK time) President and CEO CFO 11.00 Registration & breakfast 11.30 Presentations (with a lunch break at 13.00) • Strategy review by President and CEO: Jari Rosendal • Pulp & Paper: Kim Poulsen • Industry & Water: Antti Salminen - Oil & Gas: Pedro Materan • Sourcing: Thierry Blomet Kim Poulsen Antti Salminen President, Pulp & Paper President, Industry • Presentation by the CFO: Petri Castrén & Water 14.50 Breakout sessions with the management 16.05 Cocktails Presentations may also be viewed live on a webcast at: www.kemira.com/investors Thierry Blomet Pedro Materan SVP, Sourcing SVP, Oil & Gas For further information, please contact tiina.huoponen@kemira.com
Kemira today Kemira is a global chemicals company serving customers in water-intensive industries 2.4 12.8 % 4 818 Revenue in Operative Personnel EUR billion (FY 2016) EBITDA margin (FY 2016) (2016) 63 110 32 000 Manufacturing sites Ship-to-countries Shareholders Pulp & Paper Industry & Water Revenue EUR 1,457 million Revenue EUR 906 million #1-2 in all regions #1 in raw and waste water treatment ~17 % market share globally ~30 % market share in Europe and North America #2 in polyacrylamide polymers Investor Presentation - July 2017 3
Pulp & Paper FY2016: Revenue EUR 1,457 billion, Operative EBITDA EUR 195 million, margin 13.4% Customers, examples Customer 40% 40% mills Pulp production Board & tissue production 20% Paper production Geographies 10% Other 35% 10% 35% 50% 15% Bleaching and Polymers pulping Americas EMEA APAC Products 20% Defoamers, 25% dispersants, Sizing & biocides and other strength process chemicals Note: Revenue by industry, product and geography rounded to the nearest 5% Investor Presentation - July 2017 4
Industry & Water FY2016: Revenue EUR 906 million, Operative EBITDA EUR 107 million, margin 11.8% Industrial (60%), Municipal (40%), 10% customer examples customer examples Other applications London New York City Montreal 15% Frankfurt Shanghai Application Stockholm 75% Oil & Gas Toronto Los Angeles split Water treatment Las Vegas Singapore Barcelona Oslo Miami Berlin Melbourne Amsterdam Paris Washington DC 20% Geographies Other products such as defoamers and biocides 40% 55% 5% Products Americas EMEA APAC 45% Coagulants 35% Polymers Note: Revenue by industry, product and geography rounded to the nearest 5% Investor Presentation - July 2017 5
Stable business and sustainable profitability improvement Revenue Operative EBITDA and operative EBITDA margin EUR million EUR million 2 373 2 363 303 287 2 241 2 229 2 137 253 252 249 11.1% 11.3% 11.8% 12.1% 12.8% 2012 2013 2014 2015 2016 2012 2013 2014 2015 2016 Investor Presentation - July 2017 6
Our strategy for profitable growth Growth Acquisitions • Investments in Very selective capacity expansions approach • • Seize opportunities Strategic fit in growth pockets • Above-the-market Accretive to • Recovery of shale profitability revenue growth oil & gas business • Modest valuation & operative • CEOR and oil sands Efficiency • R&D, new products EBITDA margin • Site footprint of 14-16% optimisation • BOOST • Organizational Cost discipline efficiencies with Prudent cost culture new structure Investor Presentation - July 2017 7
Our key actions for higher margins Operative EBITDA margin 14-16% Advanced Chemical Water Optimization Enhanced Treatment 12.8% of operations: New Oil Recovery Efficiencies e.g. Logistics, investments & 12.1% 11.8% AkzoNobel’s Sourcing, from new (Brazil and oil sands Manufacturing paper two segment Finland), chemicals structure New TCM business contracts 2014 2015 2016 Acquisition Group Pulp & Paper BOOST - Oil & Mining Municipal & Mid- to long- synergies operational Industrial term target excellence Estimated end of 2017 run-rate 100% 100% Approx. 50% Low Low Low Full run-rate by End of 2017 End of 2017 2018 2-3 yrs 3-5 yrs 3-5 yrs Investor Presentation - July 2017 8
New organization effective as of June 2017 EUR 1,457 million EUR 906 million revenue (2016) revenue (2016) • Oil & Mining and Municipal & Industrial merged into new segment “Industry & Water” • Organization structures streamlined Pulp & Paper Industry & Water • Management layers decreased and span of control increased • Support functions adjusted • Reduction mainly from top and middle management Operative Operative • 11.8 % 13.4 % Cost savings of EUR 15-20 EBITDA EBITDA million with full run-rate by end In water treatment chemicals in In bleaching, process and #1 of 2017 #1 Europe and North America functional chemicals – Majority of restructuring costs In dry and emulsion #2 polyacrylamides booked in Q2/17 (EUR 8 million) Segment figures as of FY2016 Investor Presentation - July 2017 9
Profitable growth – achievements & ongoing projects Opening / expansion of site Acquisition Operational efficiencies Closure of site Odyssey go-live in North America 11.3% 12.8% New organization Start-up of Ortigueira Transportation operational 2016 operative EBITDA 2013 operative EBITDA (BR) sodium chlorate site agreement with and announcement of Odyssey Joutseno (FI) expansion Opening of Q2/17 Q1/17 Nanjing Acquisition of Soto Q4/16 (CN) multi- Acquisition Industries (US) Q3/16 purpose BASF AKD emulsion Q2/16 site Q1/16 Opening of Q4/15 Tarragona Bradford (UK) Q3/15 coagulant site (ES) Acquisition expansion Q2/15 of Polymer Q1/15 San Giorgio (IT) Services (US) expansion Q4/14 AkzoNobel’s paper Closure of Q3/14 Ottawa (CA) chemicals acquisition Soave (IT) Q2/14 closure Q1/14 Expansion of pulp Decision to close Botlek (NL) chemicals, Oulu (FI) Zaramillo (ES) modernization Expansion of dry Closure of and emulsion BOOST operational Longview (US) polyacrylamide excellence program Start-up of EMEA (US) launch service center Investor Presentation - July 2017 10
Kemira’s market environment Kemira’s relevant market Long-term drivers for growth, including: EUR billion – +2% Recycling leading to higher usage of strength chemicals 2.4% – Online shopping increasing need for 5.4 packaging material 4.8 – Growing middle class in emerging markets 2.5% leading to higher usage of tissue, board, paper 14.4 12.7 – Regulation driving better water quality – 1.0% Increased oil drilling from existing fields Challenges 9.5 9.1 – Modest global GDP growth 2015 2020 – Low oil price impacts negatively activity in oil P&P O&M M&I industry, particularly shale market Source: Management estimation based on various sources Investor Presentation - July 2017 11
BOOST - targeting EUR 20-30 million of cost savings and EUR 50 million of inventory reduction 13,000 200 16,000 suppliers warehouse ship-to- locations customers Customer KemConnect Service Distri- bution center Supplier Kemira TO- Customer 63 2,300 250,000 manufacturing sites products orders per year Investor Presentation - July 2017 12
Kemira offers stable dividend, yield attractive • Kemira’s dividend policy is to pay a 0,53 0,53 0,53 0,53 0,53 0,53 stable and competitive dividend • Kemira has paid dividend every year since listing of shares in 1994 5.8% 4.5% 4.4% 5.4% 4.9% 4.4% • Kemira offers attractive dividend yield – Average dividend yield in relevant indices • EuroStoxx Chemicals 2.3% • OMX Helsinki 25 3.5% 2011 2012 2013 2014 2015 2016 Dividend per share Dividend yield Kemira’s dividend yield calculated using the share price at year-end Investor Presentation - July 2017 13
Innovation and R&D – cornerstone for competitive edge • Kemira has built expertise in chosen fields of chemistry and customer applications since decades • More than 1,200 granted patents represent the vast amount of knowhow • Currently 250 R&D experts located in Finland, USA and China • Latest development areas, e.g. – Lighter and stronger board – Sludge dewatering – Tailored polymers for harsh conditions (CEOR) Investor Presentation - July 2017 14
Latest news and financials
Recommend
More recommend
