q4 and fy 2013 results€¦ · •no more one-off costs related to divestment bakery supplies...
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26 FEB 2014 GERARD HOETMER/KOOS KRAMER
Q4 AND FY 2013 RESULTS
© 26/2/2014
Corbion highlights Q4 2013
• Organic sales growth of 4.2%
• Volumes were up 5.7% driven by strong volume performance of Biochemicals (+17.8%)
• EBITDA before one-off costs increased by 5.7%, at constant currencies
16.6%
• EBITDA margin improved by 50 bps to 12.1% (Q4 2012: 11.6%)
• Additional R&D expenses: € 3.3 M
• Net cash position of € 29.4 M
• Open market buy-back and tender offer completed
• New members Board of Management nominated by Supervisory Board º Tjerk de Ruiter – CEO º Eddy van Rhede van der Kloot – CFO º Sven Thormählen - CTO
2
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How we built the future
- Thai factory (100 kT) Changing the supply chain of Purac, no more LA in Europe
- Lactide plant (75 kT) First step to move into bioplastics with Purac
- New platform Developed leading, gypsum free fermentation process
- 2G biomass input Embarked on path to move to 2G feedstock by 2016
- Succinic JV BASF Use fermentation skills beyond Lactic Acid
What we did to make this possible
- Sale of Sugar First step to bring more focus
- 3S program Delivering the required funds to revitalize the company
- Sale of Bakery Focus on Biobased products, reallocation of funds
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Strategic Journey 2005 – 2013 From CSM to Corbion
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Segment strategies sharpened; - Biobased Food Ingredients => Food Integrity strategy
- Biochemicals => more focus on new molecules (FDCA, CalPro)
New organization created, former Purac and Caravan integrated; - Market units focusing on selected product/market combinations
- Global Supply Chain, Innovation and Support functions
Innovation pipeline growing - Freshness solutions
- Succinic acid
- Lactides in Biochemicals
- PLA
- FDCA
- Calcium Propionate
New manufacturing process technologies developed to: - Significantly reduce costs
- Lower environmental impact
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Ready for the Future
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Feasib
ility
Capability
Imple
menta
tion
Test sc
ale
Comm
ercializ
atio
n
News
Supply chain
Gypsum free
Biomass
Biobased Food Ingredients
Ferments
Ultra Fresh Sweet Positive feedback from customers
Ultra Fresh Premium Advantage Positive feedback from customers
Anti-Molding Technology
Calcium Propionate
Biochemicals
PLA
Animal Health
Succinic Acid (BASF JV)
Fiberlive (Biomaterials)
Calcium Propionate
FDCA
Innovation pipeline and R&D expenses
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• R&D expenses increased by € 6 M in 2013. Will continue to increase in line with strategy
YTD YTD
€ million 2013 2012
R&D expenses cash-out 29.2 23.0
Capitalization (5.3) (4.8)
Depreciation & amortization 1.9 1.1
Impairment 0.0 0.0
R&D expenses 25.8 19.3
R&D expenses before D&A 23.9 18.2
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We expect the current macro-economic environment to be challenging. However, we are optimistic on the progress we have made as a company, and on our growth prospects in the coming years.
• Sales growth to make progress towards target ranges
• Deflationary raw material markets expected to show positive effect
• R&D expenses expected to increase by € 5 M (2013 increase: € 6 M)
• With today’s insights, we expect headwind from currencies
• No more one-off costs related to divestment Bakery Supplies businesses
• Interest expenses minimal
• Tax as a % of pre-tax profit between 20-25%
• Capital Expenditures in line with strategy; € 300 M over the period 2014-2016
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Outlook 2014
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Financial results Q4/FY 2013
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• Currencies impact EBITDA FY13 by € -5 M. Q4 by
€ -2 M
• Financial expenses lower as net debt turns into net cash in 2nd half
Profit & Loss
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€ million Q4 Q4 YTD YTD
2013 2012 2013 2012
Net Sales 184.6 182.5 743.6 753.7
EBITDA excl. one-off costs 22.3 21.1 99.2 99.0
Depreciation & Amortization (41.0) (43.2)
One-off costs (19.2) (18.2)
EBIT 39.0 37.6
Financial income/expenses (16.6) (24.5)
Result joint ventures/assoc. (1.2) (0.1)
Taxes (14.0) 12.6
Result after tax from continued operations 7.2 25.6
Result discontinued operations (3.0) (90.9)
Result after tax 4.2 (65.3)
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• Acquisition effect is sales to divested Bakery activities which are now classified as 3rd party sales instead of intercompany sales
Growth per segment in Q4 2013
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Q4 2013 Total Growth Currency Growth in local
currency Acquisitions /
reclassifications Organic Price/Mix Volume
Biobased Food Ingredients -2.1% -5.8% 3.7% 3.3% 0.4% -1.7% 2.1%
Biochemicals 11.7% -4.8% 16.5% 0.0% 16.5% -1.3% 17.8%
Total 1.1% -5.6% 6.7% 2.5% 4.2% -1.5% 5.7%
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• Volume growth 5.7%
• Higher R&D expenses drive up cost level
• Final one-off costs related to divestment Bakery Supplies
EBITDA bridge Q4 2013
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10
21 22
10
5 2
-3
-2
-13
0
5
10
15
20
25
30
-3
0
-4
-2
0
R&D Othercosts
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-6
2
-8
-6
-4
-2
0
2
4
R&D Othercosts
• Volume driven growth of € 11 M
• Cost increase mostly R&D driven
• One-off costs related to divestment Bakery Supplies, pension fund settlements, severance and IT disentanglement
EBITDA bridge FY 2013
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11
99 99
81
11 0
-4 -5 -1
-18
0
20
40
60
80
100
120
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• Raw materials have come down and are gradually supporting our
competitive position
Raw materials Development
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€ million 1Q13 2Q13 3Q13 4Q13
Pricing minus Raw Materials 0 -2 0 2
Carbohydrates, 33%
Fats & Oils, 18%
Other, 49%
as % of total RM spend
14%
8%
21%
0%
5%
10%
15%
20%
25%
Carbohydrates Fats & Oils Other
RM as % of total net sales
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Biobased Food Ingredients
• Volume growth in all market
units in Q4
• Margin in Q4 impacted by reclassification interco to 3rd party and additional R&D cost
• Bakery: Proprietary market data shows small increase bakery consumption after 10 quarters negative
• Meat: Full year growth positive after 2 years decline. Gained market share. 2012 2013
Q4 Q4 YTD YTD
€ million 2013 2012 2013 2012
Net Sales 137.8 140.7 566.0 579.7
Organic growth 0.4% -1.8% 0.2% -1.0%
EBITDA excl. one-off costs 23.5 24.8 105.7 106.9
Margin 17.1% 17.6% 18.7% 18.4%
10.0%
12.0%
14.0%
16.0%
18.0%
20.0%
22.0%
100
110
120
130
140
150
160
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
Net Sales (€ mln) EBITDA margin before one-off costs (RHS)
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Biochemicals
• Strong volume growth in full year (11%) and Q4 (18%)
• Agrochemical and animal feed acidifiers pushing growth in Q4
• EBITDA margin declining due to higher (R&D) costs. Lion share of incremental Corbion R&D costs
2012 2013
Q4 Q4 YTD YTD
€ million 2013 2012 2013 2012
Net Sales 46.8 41.9 177.6 174.0
Organic growth 16.5% 4.1% 5.6% 3.4%
EBITDA excl. one-off costs 3.4 3.9 15.9 18.1
Margin 7.3% 9.3% 9.0% 10.4%
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
12.0%
14.0%
0
10
20
30
40
50
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
Net Sales (€ mln) EBITDA margin before one-off costs (RHS)
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• Net cash level of € 29 M
• Total cash flow discontinued business € 842 M
Net debt bridge FY 2013 - YTD
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15
-511
29
2 66 70
201 36
2
842
-50
50
150
250
350
450
550
650
750
850
950
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Major Capex programs:
• Biomaterial plant US
• New lactic acid production technology
• Succinic acid plant Spain
Capital Expenditures
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16
0
10
20
30
40
50
60
70
80
2009 2010 2011 2012 2013
Capex (€ mln)
YTD YTD
€ million 2013 2012
Maintenance 18.3 35.3
Expansion 57.2 20.4
Total Capex 75.5 55.7
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Q&A
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Appendix
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• Acquisition effect is sales to divested Bakery activities which are now classified as 3rd party sales instead of intercompany sales
Growth per segment YTD 2013
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FY 2013 Total Growth Currency Growth in local
currency Acquisitions /
reclassifications Organic Price/Mix Volume
Biobased Food Ingredients -2.4% -4.2% 1.8% 1.6% 0.2% -0.7% 0.9%
Biochemicals 2.1% -3.5% 5.6% 0.0% 5.6% -5.3% 10.9%
Total -1.3% -4.1% 2.8% 1.3% 1.5% -1.5% 3.0%
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Divestment Bakery
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€ million
Selling price 1050
Sale of pension liabilities 132
Normalization of work capital 44
Net proceeds 874
Returned to shareholders 250
Debt reduction 624
Divestment result (gross) 6
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Adjusted historical quarterly EBITDA’s
• New reclassification of costs between segments
• No change to central costs and total EBITDA level
EBITDA before one-off costs in € million Q1 2013 Q2 2013 Q3 2013 Q4 2013
Biobased Food Ingredients
Reported 24.2 29.8 27.1
Adjusted 24.6 30.1 27.5 23.5
Biochemicals
Reported 5.4 4.2 4.0
Adjusted 5.0 3.9 3.6 3.4
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