clariant investment story 2019 - swiss equities conference · 2020-01-09 · additive concentrates...

Clariant Investment Story

January, 2020

January 2020

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.

Clariant Investment Story 20202

Who We Are

January 2020

Clariant Continuing Operations at a Glance*


OPERATING

CASH FLOW**368in CHF m

EBITDAbefore exceptional items

in CHF m

739

NET INCOME

in CHF m

213

EBITDAafter exceptional items

in CHF m

607 13.8 %margin

* Full Year 2018 Continuing Operations figures

** Pro-forma figure as Cash Flow is calculated and reported at total company level only

COUNTRIES > 50

BUSINESS

AREAS 3

EMPLOYEES ~ 12 000

SALES

in CHF m

4 404

16.8 %margin

January 2020

LATIN AMERICA

13 %

MEA

8 %

EUROPE

35 %

NORTH AMERICA

20 %

ASIA-PACIFIC

24 %

Clariant - A Focused and Innovative Specialty Chemical Company


SALES BY REGION* SALES BY BUSINESS AREA

AND IN % OF CONTINUING OPERATIONS Total Continuing Operations sales 2018: 4 404

CARE

CHEMICALS

in CHF m

1 665 (38 %)

CATALYSIS

in CHF m

861 (19 %)

NATURAL

RESOURCES

in CHF m

1 878 (43 %)

* Full Year 2018 Continuing Operations figures

January 2020

A More Focused, High Value Specialty Portfolio

6

CATALYSIS

BA Catalysis comprises the BU Catalysts and

the Business Line Biofuels & Derivatives. It

develops, manufactures, and sells a wide range

of catalyst products for the chemical and fuel

industries which contribute significantly to value

creation in our customers’ operations, ensuring

that finite raw materials and energy are used

efficiently. In addition, Catalysis is in the forefront

of new market developments such as the

commercialization and licensing of bio-ethanol.

NATURAL RESOURCES

BA Natural Resources comprises the BUs Oil &

Mining Services, Functional Minerals and since July

2019 also Additives. It is characterized by high growth

and low cyclicality as well as a strong megatrend

orientation. Main drivers are the rising demand for high

value-added specialty chemicals used in the oil,

mining, food and packaging industries and the

increased consumption of oil, gas and base metals,

driven by the fast-growing economies. Additives

provides highly customized products, technologies and

applications mainly for the plastic and polymer as well

as the electronics industries.

CARE CHEMICALS

BA Care Chemicals comprises the BU

Industrial & Consumer Specialties (ICS)

which includes Consumer Care, Industrial

Applications, Base Products, Food

Ingredients and Encapsulation Technologies.

The BU New Business Development

encompasses Electronic Materials and

Additive Manufacturing/3D Printing. These

businesses demonstrate a clear focus on

highly attractive, high-margin, and low-

cyclicality segments. The BA follows a

lifestyle-driven megatrend and strengthens

Clariant’s position as a supplier of green and

sustainable products. * restated to include Additives

Sales growth

expectation p.a. 5 - 7 %

EBITDA

margin ambition 2021E19 - 21 %

Sales growth

expectation p.a. 6 - 9 %

EBITDA

margin ambition 2021E26 - 30 %

Sales growth

expectation p.a.* 5 - 7 %

EBITDA

margin ambition 2021E*18 - 20 %


Continuing Operations:

January 2020


Discontinued Operations:

FY 2018 Sales CHF 135m

Total consideration CHF 308m

Multiple*13.2 x

EBITDA bei

Closed 31. October, 2019

HEALTHCARE PACKAGING

Healthcare Packaging designs and

manufactures proven and innovative

solutions so critical healthcare industries can

protect their products from moisture and

oxygen. Healthcare Packaging is specialized

in moisture, oxygen and odor control

technologies, as well as in primary plastic

packaging.

* Based on Full Year 2018

** Based on last twelve months ending September 2019

MASTERBATCHES

The Masterbatches business offers color and

additive concentrates and performance

solutions for plastics. Masterbatches help to

enhance the market appeal or end-use

performance of plastic products, packaging

or fibers.

PIGMENTS

Pigments is a leading global provider of

quality organic pigments, pigment

preparations and dyes used in the

automotive industry, for industrial and

architectural coatings, for the plastics

industry, to color home and fabric care

products and many other applications

including seed coloration, traditional and

digital printing.

FY 2018 Sales CHF 1.2bn

Total consideration USD 1.6bn

Multiple**12.2 x

EBITDA aei

Closing expected Q2/Q3 2020

FY 2018 Sales CHF 850 - 900m

Total consideration ---

Multiple ---

To be divested by end 2020

January 2020

Our Way Forward


− By adhering to Clariant’s strategy of focusing on intensifying

growth, operational excellence, innovation and sustainability

we are beginning a new chapter in the Clariant story.

− Clariant will shrink in size and enhance the quality of the

portfolio and earnings by focusing on the three unchanged

core Business Areas: Care Chemicals, Catalysis and Natural

Resources

− The proceeds from the divestments will be used to invest in

innovations and technological applications within the core

Business Areas, to strengthen Clariant’s balance sheet and to

return capital to shareholders in the form of an extraordinary

cash distribution of CHF 3 per share subject to a positive vote

of Clariant’s shareholders at the AGM, conditional to closing.

− With the divestments, some of the complexity and costs will

leave the company. Post-divestments Clariant will be rightsized

and optimized. We are currently reviewing the changes

necessitated by this reduction.

Focus on Innovation and R&D

January 2020

Clariant’s Innovation Chain Links ‘Technology Push’ with ‘Market Pull’


Application DevelopmentTechnical ServiceMarketing, Production

R&D shaped along Technology Platforms

GROUP TECHNOLOGY & INNOVATION BUSINESS AREAS MARKETS & CUSTOMERS

ENGINEERING

INTELLECTUAL PROPERTY MANAGEMENT

CARE CHEMICALS

NATURAL RESOURCES

CATALYSIS

PLASTICS &

COATINGS

CHEMISTRY & MATERIALS

BIOTECHNOLOGY

CATALYSIS

PROCESS TECHNOLOGY

January 2020

Focus on Innovation and R&D*

11 Clariant Investment Story 2020

Growth through innovation** R&Din % of sales

R&D in CHF m

209 3.2 % > 3 % 6700

R&D

Centres

> 11008People in R&D

Patents

> 125Scientific collaborations

> 50 Technical

Application

Centres

* Full Year 2018 figures for Total Group

** Contains the contribution to growth from both Top Line Innovation as well as Life Cycle Innovation. Potential cannibalization of existing sales caused by Life Cycle Innovation in certain cases has not been excluded from calculation.

ENVIRONMENT

PROTECTION

GLOBALIZATION

& URBANIZATION

RESOURCES

& ENERGY

Add Value with Sustainability

January 2020

− 2025 environmental targets

− Sectoral commitment: Responsible Care® is the

global chemical industry initiative to improve health,

environmental performance, enhance security, and

communicate with stakeholders about products and

processes

− Operational excellence / zero accident goal:

Employee standards / human rights, occupational

safety, people development

− Portfolio Value Program: Reflecting People, Planet

and Performance across the Life Cycle

− Product Stewardship: Ensuring Safety and

Environmental Standards (e.g. Registration,

Evaluation, Authorization and Restriction of Chemical

substances, REACH)

− Collaborations to expand portfolio of natural

ingredients (Personal Care: Beraca, BioSpectrum,

PT Martina Berto, Plant Advanced Technologies)

Clariant proactively engages with suppliers to steer and

ensure sustainability in the choice of raw materials and

their processing, where feasible, and to address

particular environmental and social risks related to raw

materials:

− Supplier assessment and audit programs, supplier code of

conduct (ISO 9001 / 14001 / OHSAS 18001)

− Commitment to sustainability in the supply chain:

Chemical industry initiative “Together for Sustainability”

− Member of RSPO (Roundtable on Sustainable Palm Oil)

− SPOTS initiative: Integrating small local palm oil

producers within the global supply chains

Sustainability Across Different Levels Along the Value Chain


− Biennial Customer Satisfaction Survey

− Customer approximation / looking ahead:

− sunliquid®

− BeautyForward®

− Essence by Clariant

SUPPLIER CLARIANT MARKET & CUSTOMERS

January 2020

Our Sustainability Acknowledgements


January 2020

Raw Material and Operational Efficiency – Protecting the Environment, Reducing Costs


CLARIANT’S

ENERGY SAVING

PROGRAM

OPERATIONAL

EXCELLENCE

CERTIFIED

MANAGEMENT

SYSTEM

2025 ENVIRONMENTAL TARGETS* CONTINUOUS IMPROVEMENT SUSTAINABLE RAW MATERIALS

Raw materials contribute significantly

to product life-cycle performance and

are therefore key to Clariant’s

sustainability efforts.

For example, RSPO certification

ensures the sustainability of palm

based materials.

Greenhouse gases Waste

Waste water

Direct CO2

Water use

Electricity

* Based on 2013 values (in % t produced goods)

January 2020

Environmental and Resource Efficiency Achievements and Targets


ENVIRONMENTAL TARGETS* 2025 ON TRACK

Reduction

of Energy

Consumption

Reduction

of Direct CO2

Emissions

Reduction of

Greenhouse

Gas Emissions

Reduction

of Water

Consumption

Reduction

of Waste Water

Volume

Reduction

of Waste**

Volume

- 35 %

- 40 %- 35 %

- 30 %

2018 achievements

- 30 %

- 35 %

- 20 % - 18 % - 28 %

- 31 % - 37 % + 4 %

2025 targets* Based on 2013 values (in % t produced goods), ** Waste performance mainly affected by non-hazardous waste increase e.g. from gypsum waste

Outlook

January 2020

Outlook 2021: Above-Market Growth, Higher Profitability and Stronger Cash Generation


− Clariant is a focused and innovative specialty chemical company. We aim to

provide more than just customer-oriented products. We strive to provide the

best customer experience and fast, reliable customer fulfillment in the industry

by setting the right priorities.

− Despite the current challenging environment, Clariant expects its continuing

businesses to achieve above-market growth, higher profitability and stronger

cash generation based on our focused, high value specialty portfolio.

Back-up Slides

January 2020

Quarterly and FY 2018 – Sales and EBITDA b.e.i.1 by Business Area

20

Sales to 3rd parties EBITDA

before exceptionals

in CHF m Q1 2018 Q2 2018 Q3 2018 Q4 2018 FY 2018 Q1 2018 Q2 2018 Q3 2018 Q4 2018 FY 2018

Care Chemicals 484 400 385 396 1 665 89 74 83 70 316

margin 18.4 % 18.5 % 21.6 % 17.7 % 19.0 %

Catalysis 197 207 199 258 861 39 49 36 75 199

margin 19.8 % 23.7 % 18.1 % 29.1 % 23.1 %

Natural Resources2 467 469 470 472 1 878 82 68 75 68 293

margin 17.6% 14.5% 16.0% 14.4% 15.6%

Business Areas Total1 148 1 076 1 054 1 126 4 404 210 191 194 213 808

Corporate Costs – -20 -19 -23 -7 -69

Total Continuing 1 148 1 076 1 054 1 126 4 404 190 172 171 206 739

margin 16.6% 16.0% 16.2% 18.3% 16.8%

Discontinued 574 591 551 503 2 219 78 84 70 47 279

Total Group 1 722 1 667 1 605 1 629 6 623 268 256 241 253 1 018

1 b.e.i. = before exceptional items 2 including Additives


January 2020

Quarterly and FY 2018 – Sales and EBITDA a.e.i.1 by Business Area

21

1 a.e.i. = after exceptional items 2 including Additives

Sales to 3rd parties EBITDA

after exceptionals

in CHF m Q1 2018 Q2 2018 Q3 2018 Q4 2018 FY 2018 Q1 2018 Q2 2018 Q3 2018 Q4 2018 FY 2018

Care Chemicals 484 400 385 396 1 665 88 73 83 70 314

margin 18.2 % 18.3 % 21.6 % 17.7 % 18.9 %

Catalysis 197 207 199 258 861 39 48 34 64 185

margin 19.8 % 23.2 % 17.1% 24.8 % 21.5 %

Natural Resources2 467 469 470 472 1 878 79 65 64 63 271

margin 16.9 % 13.9 % 13.6 % 13.3 % 14.4 %

Business Areas Total1 148 1 076 1 054 1 126 4 404 206 186 181 197 770

Corporate Costs – -25 -26 -39 -73 -163

Total Continuing 1 148 1 076 1 054 1 126 4 404 181 160 142 124 607

margin 15.8 % 14.9 % 13.5 % 11.0 % 13.8 %

Discontinued 574 591 551 503 2 219 75 78 68 43 264

Total Group 1 722 1 667 1 605 1 629 6 623 256 238 210 167 871


January 2020

Consolidated Income Statement FY 2018

22

in CHF m Total Continuing Discontinued

Sales 6 623 4 404 2 219

Costs of goods sold -4 679 -3 032 -1 647

Gross profit 1 944 1 372 572

Selling, general and administrative costs -1 173 -802 -371

Research & development -208 -174 -34

Income from associates and joint ventures 130 84 46

EBIT (before exceptional items) 693 480 213

Exceptional items / disposals -147 -132 -15

EBIT 546 348 198

Finance result -81 -67 -14

Taxes -109 -68 -41

Net result 356 213 143

EBITDA (before exceptional items) 1 018 739 279

EBITDA 871 607 264


January 2020

The Executive Committee


January 2020

Maria Ivek Phone: +41 61 469 63 73

Senior Investor Relations Officer Email: [email protected]

Alexander Kamb

Investor Relations Officer

Investor Relations Contacts


mailto:[email protected]

January 2020

Download it here:

iPad App: www.clariant.com/IRapp

Our iPad App


http://www.clariant.com/IRapp

clariant investment story 2019 - swiss equities conference · 2020-01-09 · additive concentrates...

Documents