Umicore Investor Presentation September 2020
Introduction to Umicore
We are a global materials technology and recycling group The world’s leading One of three global A leading supplier of key leaders in emission control materials for rechargeable recycler of complex waste catalysts for light-duty and batteries used in electrified streams containing heavy-duty vehicles and transportation and portable precious and other for all fuel types electronics valuable metals 3
With a unique position in clean mobility materials and recycling Internal Plug-In Hybrid Combustion Engine Electric Vehicle Umicore provides: Umicore provides: Emission control catalysts Battery cathode materials and emission control catalysts Fuel cells Full Electric Vehicle Umicore provides: Umicore provides: Electro-catalyst and Battery cathode materials battery cathode materials Present across all drive trains and offering sustainable closed- loop services 4
Built on sound foundations Supportive Unique business Industry leader in megatrends & model sustainability legislation resource scarcity more stringent emission control electrification recycling recycling of the automobile We help improve air quality, make electrified transport possible and tackle resource scarcity 5 5
With a robust financial performance and a global presence Key figures (FY 2019) Adj. Revenues EBITDA € 3.4 bn € 753 m Adj. EBIT ROCE € 509 m 12.6% 40% - Europe Revenues* by Clean geography 14% - North America R&D mobility and Recycling 6% of 4% - South America 75% of revenues revenues 39% - Asia-Pacific 6 3% - Africa * 2019 data
We deliver on our Horizon 2020 strategy Clear leadership Doubled the size in clean mobility of the business in materials and terms of earnings recycling Rebalanced the Turned portfolio sustainability into & earnings a greater contributions competitive edge 7
With a focused & balanced Group structure ENERGY & SURFACE CATALYSIS RECYCLING TECHNOLOGIES Automotive Catalysts Rechargeable Battery Materials Precious Metals Refining Precious Metals Chemistry Cobalt & Specialty Materials Jewelry & Industrial Metals Electroplating Precious Metals Management Electro-Optic Materials Capital employed* Revenues* Adj. EBIT* (average) (excluding metal) 13% 20% 35% 33% 34% 43% 52% 37% 33% 8 * FY 2019 data; corporate not included
Unique position in Automotive Catalysts CATALYSIS Strong growth drivers : Umicore best positioned to Tightening emission norms for capture growth in growing LDV and HDD, in particular in gasoline segment; largest share China, Europe and India of cGPF platforms won in China and Europe Significant value uplift especially in gasoline catalysts Umicore well positioned to capture growth in HDD segments Increasing share of gasoline platforms in the global mix Umicore expanding capacity in Increasing uptake of fuel cell fuel cells drivetrains 9
Unique position in Rechargeable Battery Energy & Materials for xEV Surface Technologies Electrification confirmed as main avenue to Umicore uniquely positioned to address drastically reduce vehicle emissions in mid- and long-term requirements of this industry, long-term while managing short-term fluctuations Strongly supported by legislation and evidenced with agility by massive roll- out of car OEM’s e -mobility Full spectrum of highest quality strategies cathode materials Increasing electrification drives strong market demand in mid and long-term Process technology and ability to scale up fast Innovation pipeline spanning next Technology roadmap offers ample room for 20 years innovation and differentiation Product Integrated supply chain and battery recycling Process Closed loop offering 10
Unique position in Recycling RECYCLING Metallurgical leadership and proprietary technologies for Increasing resource scarcity and need for closing the treating complex residues and by- loop products Growing complexity of materials to recycle Increased availability of complex materials, in particular Closing the loop in product businesses by end-of-life materials offering recycling services Eco-efficient recycling processes are becoming the norm Over 200 different input streams Umicore uniquely positioned to capture growth as the Recovery of more than world’s largest and most complex precious metal 20 different metals recycler with world class environmental and quality standards 11
Solid framework for value creation Focus on Strong Focus on cashflows and growth returns solid capital structure • Multiple growth drivers • Earnings growth objective • Prioritize cash for strategic organic growth projects • Secular trends • Group and segment • Currently in accelerated returns > cost of capital • Supporting legislation investment phase • 15%+ ROCE target • Privilege organic growth • Strong self-funding capacity • Value creation precedes • Complementary M&A, with (normalized excl. current ROCE maximization focus on value creation acceleration) • Cash return to shareholders 12
Maintaining a healthy capital structure 35.2% 33.6% 31.1% 28.6% 24.4% 23.2% 14.3% 14.1% H1 20 net financial debt of € 1,349 m, 13.8% million € slightly below the level of end 2019 1.48 1.92 1.75 1400 1.40 1443 1.60 1.19 Gearing 1349 1200 0.99 ratio 1.10 0.64 Corresponds to robust credit ratios : 1000 0.56 1059 0.39 0.60 800 Net debt • Net debt / LTM Adjusted EBITDA 861 840 / LTM Adj. EBITDA 0.10 600 ratio of 1.75x 556 400 -0.40 429 Consolidated net • Net gearing ratio of 34 % 200 298 296 -0.90 financial debt, end of period 0 -1.40 2016 2016 2017 2017 2018 2018 2019 2019 2020 H1 H2 H1 H2 H1 H2 H1 H2 H1 Further extended and diversified strong liquidity base in June 2020: Long-Term Fixed Rate Debt Maturity Profile million € • € 125 m 8 -year EIB loan 500 • € 500 m 5 -year convertible bond 400 • € 1.2 bn cash on balance sheet at 30 300 June in addition to appr. € 1 bn of 200 committed undrawn credit lines 100 0 2023 2024 2025 2026 2027 2028 2029 2030 2031 13
Business Group Overview Catalysis
Catalysis A world leader in emission control catalysts for light-duty and Automotive heavy-duty vehicles and for all fuel types. Complemented by Catalysts smaller stationary catalyst applications (marine, power generation, …). Precious Develops and produces metal-based catalysts used in chemistry, Metals life sciences and pharmaceutical applications. Also has a complete portfolio of catalyst technologies for fuel cells. Chemistry 15
Automotive Catalysts: business model We develop technologies which allow our customers to meet automotive emission legislation at the lowest Total Cost of Ownership Complete catalyst systems Customer focus to reduce exhaust gas emissions People Operational engagement excellence Global manufacturing & technical footprint 16
Automotive Catalysts Production Footprint 17 plants in 14 countries, 9 R&D / tech. centers in 7 countries Frederikssund Karlskoga Lyngby Nowa Ruda Songdo Denmark Sweden Denmark Poland Korea Onsan Hanau Burlington Korea Germany Canada Tokoname Japan Auburn Hills, MI Florange USA France Kobe Japan Rheinfelden/ Bad Säckingen Himeji Germany Japan Houston, TX USA Tianjin China Americana Suzhou Brazil China (2) Production plant R&D/Tech. center Joinville Port Elizabeth Pune Rayong Production plant/R&D Tech. center Brazil South Africa India Thailand Stationary 17
Catalysis – major milestones in 2019 Capacity expansions Sustained investments Opening of new plant to support growth of in product and for fuel cell catalysts Automotive Catalysts in process innovation in Korea China, Poland and India 18
COVID-19 outbreak: impact on auto-industry H1 2020 YoY evolution of passenger car production across all powertrains (source: IHS & Umicore - 20/07/2020) China Europe North America Global market 2,500,000 2,500,000 2,500,000 9,000,000 -47% -34% -27% 8,000,000 -12% -62%-54% -39% -67% -26% 2,000,000 2,000,000 2,000,000 -21% 7,000,000 -93% -34% 6,000,000 -31% -85% 1,500,000 1,500,000 1,500,000 -30% -99% 5,000,000 -88% 4,000,000 1,000,000 1,000,000 1,000,000 3,000,000 2,000,000 500,000 500,000 500,000 1,000,000 0 0 0 0 January February March April May June January February March April May June January February March April May June January February March April May June 2019 2020 2019 2020 2019 2020 2019 2020 H1 2020 global car production down 35% YoY
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