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CPH Chemie + Papier Holding AG
Investor Day
Perlen, 13th September 2018
CPH Presentation 13. September 2018 2
Agenda
2.00 pm Welcome
2.05 pm Presentation Course of Business 2018
2.50 pm Break
3.00 pm Presentation Perlen Packaging
3.30 pm Factory Tour Perlen Packaging
4.30 pm Aperitif
CPH Chemie + Papier Holding AG
Investor Presentation
Perlen, 13th September 2018
CPH Presentation 13. September 2018 4
Contents
1 The CPH Group
2 Investment Case
3 Financial Performance
CPH Presentation 13. September 2018 5
Business divisions Chemistry
Packaging
Paper
Production locations CH, DE, USA, CN, BRA, BiH
Net sales 469.8 2017 in CHF million
EBITDA 33.8 2017 in CHF million
Balance sheet total 697.1 30.6.2018 in CHF million
Equity ratio 57% 30.6.2018
Net debt / EBITDA 1.2x 30.6.2018
Personnel 1 055 30.6.2018
The CPH Group At a Glance
CPH is a diversified Swiss-based and internationally active industrial group that was
founded in 1818. The shares of its holding company CPH Chemie + Papier Holding
AG have been traded on the SIX Swiss Exchange since 2001, and its founding
families remain anchor shareholders today.
16%
56%
28%
CPH Presentation 13. September 2018 6
Division
% of total
net sales
Brand
Products
Strategy Differentiation Cost leadership Differentiation
Molecular sieves
Chromatography gels
Newsprint paper
Magazine paper
PVC mono films
Coated PVdC films
Chemistry 16% Packaging 28%Paper 56%
The CPH Group Business Divisions
CPH Presentation 13. September 2018 7
Packaging
CHF 130.2 million
CHF 15.5 million
CH / DE / USA / BRA / CN
363
Paper
CHF 264.1 million
CHF 9.1 million
CH
345
Chemistry
CHF 75.5 million
CHF 7.3 million
CH / USA / CN / BiH
302
The CPH Group Business Divisions
7% Switzerland 27% Rest of Europe
45% The Americas 20% Asia
1% Rest of the world
15% Switzerland 81% Rest of Europe
1% Americas 3% Asia
6% Switzerland 62% Rest of Europe
16% Americas 15% Asia
1% Rest of the world
Division
Key figures
2017
Net sales 2017
by region
Net sales:
EBITDA:
Production sites:
Employees:
CPH Presentation 13. September 2018 8
The CPH Group H1 Divisional Income Statements
CPH Group Chemistry Paper Packaging
in CHF million H1 17 H1 18 H1 17 H1 18 ± in % H1 17 H1 18 ± in % H1 17 H1 18 ± in %
Net sales 231.7 264.1 38.0 37.3 -1.9 128.1 148.1 +15.6 65.5 78.7 +20.1
EBITDA 16.5 43.3 3.6 5.5 +52.6 4.8 25.3 +431.5 8.4 12.6 +50.7
EBITDA margin in % 7.1 16.4 9.5 14.7 3.7 17.1 12.8 16.1
EBIT 1.1 27.8 1.9 3.4 +85.3 -6.0 14.8 n.a. 5.5 9.6 +75.7
EBIT margin in % 0.5 10.5 4.9 9.2 -4.7 10.0 8.4 12.3
Personnel 979 1 055 272 286 +5.1 345 360 +4.3 352 402 +14.2
CPH Presentation 13. September 2018 9
2017 net sales
by region
The CPH Group Worldwide Operations
2017 net sales
by division
16% Chemistry
56% Paper
28% Packaging
78% Europe
12% The Americas
9% Asia
1% Rest of the world
CPH Presentation 13. September 2018 10
ObjectiveBalanced shares of net sales
among the three business
divisions
Higher proportion of net sales
generated outside Europe
Less dependency on the Swiss
franc in currency terms
ActionExpand Chemistry and
Packaging Divisions as
counterbalance to Paper
Expand business in markets in
growth regions
Expand production capacities
outside Switzerland
Result
The CPH Group Strategic Objectives
Shares of Chemistry and
Packaging in total net sales
Proportion of net sales
generated outside EuropeProportion of total costs
incurred in Swiss francs
2013 2017
36%
44%
2013 2017
16%
22%
20172013
70%
36%
CPH Presentation 13. September 2018 11
Contents
1 The CPH Group
2 Investment Case
3 Financial Performance
Appendix
CPH Presentation 13. September 2018 12
Financial profile showing results of corporate strategy implementation05
Solid equity base and stable anchor shareholders with a long-term commitment06
Leading market position with autonomous brands in three industrial fields01
Diversified portfolio of products and applications provided to a longstanding customer base
02
Achieve and maintain cost leadership in the paper sales markets, sole Swiss recycler of recovered paper
03
Expansion of chemistry and packaging divisions reducing exposure to paper and lowering currency movement risks
04
The CPH Group Investment Case
CPH Presentation 13. September 2018 13
Leading market position with autonomous
brands in three industrial fields
PackagingPaperChemistry
1
Division
Brand
Positioning Number 3 worldwide for
molecular sieves for industrial
applications
Number 1 in Switzerland for
newsprint & magazine paper
and waste paper recycling
Number 3 worldwide for
coated barrier films for
pharmaceutical applications
3 1 3
CPH Presentation 13. September 2018 14
PackagingPaper
Diversified portfolio of products and applications
provided to a longstanding customer base
Chemistry
2
Main markets
Industry, Energy, PharmaceuticalsMain markets
PublishingMain markets
Pharmaceuticals
CPH Presentation 13. September 2018 15
Water
Own sources
Recovered paper
Former Utzenstorf volumes
and sorting facility
Electricity
Liberalized market
Biomass power plant
Own hydro power plant
Productivity 2009-2017
Production volume in tonnes +74%
Personnel required -12%
Fixed costs in CHF -1%
Cost per tonne -32%
Logistics
Transport Market
Heat
Steam from Renergia
Sustainability 2013-2017
CO2 emissions in tonnes down 68 000 to 9 700
Almost carbon-neutral operation
Procurement Production Sales
Achieve and maintain cost leadership in
the paper sales markets, sole Swiss recycler
of recovered paper
3
The PM7: Europe’s most advanced paper machine
CPH Presentation 13. September 2018 16
November 2015 March 2016 June 2016 June 2017 August 2017 October 2017
Zeochem acquires
molecular sieve
manufacturer ALSIO of
China.
Zeochem sells its
Uetikon operating facility
to the Canton of Zurich
Perlen Packaging
expands to China,
opening a new coatings
production plant
Fertilizer production
ceases at the Uetikon site
after 137 years.
Capacities expanded at
Zeochem USA for
producing molecular
sieves used to purify
oxygen.
Zeochem takes over the
business activities of
Armar and strengthens its
deuterated products
segment.
Expansion of Chemistry and Packaging
Divisions reduce the exposure to paper
and lower currency movement risks
4
November 2017 January 2018 March 2018 August 2018
Zeochem’s new production
plant in Zvornik in Bosnia-
Herzegovina commences
operations.
Perlen Packaging acquires
Sekoya of Brazil and plans
new finishing plant for
2018.
Zeochem acquires the
molecular sieve distribution
activities of Yusheng
Chemical in China.
Zeochem moves the
production of deuterated
products to the new
location in Rüti. According to
strategic targets
CPH Presentation 13. September 2018 17
Financial profile showing results of corporate
strategy implementation
5
0%
3%
6%
9%
12%
15%
18%
0
100
200
300
400
500
600
2015 2016 2017 H1 2018
Net sales (CHF millions) EBITDA margin (%)
CPH Presentation 13. September 2018 18
Solid equity base and stable anchor shareholders
with a long-term commitment
Shareholder base (as of 31 December 2017)
49,9%
30,6%
7,2%
5,0%
1,7% 5,6%
Uetikon Industrieholding
Public shareholders
Ella Schnorf-Schmid
J. Safra Sarasin Investmentfonds
BoD, GEM and related parties
Others
0%
20%
40%
60%
80%
100%
2015 2016 2017 H1 2018
Equity ratio development
6
CPH Presentation 13. September 2018 19
Contents
1 The CPH Group
2 Investment Case
3 Financial Performance
Appendix
CPH Presentation 13. September 2018 20
The CPH Group Key Figures
in CHF million FY 2016 FY 2017 ± in % H1 2017 H1 2018 ± in %
Net sales 434.8 469.8 +8.0 231.7 264.1 +14.0
EBITDA36.98.5%
33.87.2%
-8.616.57.1%
43.316.4%
+162.4
EBIT5.9
1.4%
2.90.6%
-50.81.1
0.5%
27.810.5%
+2413.2
Net result (including minorities)-7.7
-1.8%
16.23.4%
n.a.-2.2
-0.9%
22.6+8.6%
n.a.
Cash flow 28.3 14.5 -48.8 12.6 33.4 +164.4
Free cash flow 1.9 12.9 +563.4 10.2 0.9 -91.5
Balance sheet total 672.4 697.6 +3.7 672.2 697.1 +3.7
Equity380.856.6%
396.256.8%
+4.1372.655.4%
394.256.5%
+5.8
Personnel 985 1 019 +3.5 979 1055 +7.8
CPH Presentation 13. September 2018 21
Chemistry Business Development
Net sales EBITDA
2017 net sales by region
CHF million % of net sales
0
20
40
60
80
2014 2015 2016 2017 H1 18
1st half of 2018
Zvornik production ramped up
US and Chinese facilities fully utilized
Acquisition of molecular sieve distribution activities
of Yusheng Chemical in China
Armar integrated
Manufacture of deuterated products moved
to Rüti in summer 2018
CHF million
0%
4%
8%
12%
16%
20%
0
2
4
6
8
10
2014 2015 2016 2017 H1 18
7% Switzerland
27% Rest of Europe
45% Americas
20% Asia
1% Rest of the world
CPH Presentation 13. September 2018 22
Paper Business Development
0
50
100
150
200
250
300
350
2014 2015 2016 2017 H1 18
Net sales
-5%
0%
5%
10%
15%
20%
-10
0
10
20
30
40
2014 2015 2016 2017 H1 18
CHF million % of net sales
EBITDA
First half of 2018
Broad balance in supply and demand prompts
higher paper prices
Waste paper activities of Papierfabrik
Utzenstorf successfully integrated into the new
APS Altpapier Service Schweiz AG
Positive impact of currency exchange rate
trends
CHF million
2017 net sales by region
15% Switzerland
81% Rest of Europe
1% Americas
3% Asia
CPH Presentation 13. September 2018 23
Packaging Business Development
0
30
60
90
120
150
2014 2015 2016 2017 2018
Net sales
0%
4%
8%
12%
16%
20%
0
4
8
12
16
20
2014 2015 2016 2017 H1 18
EBITDA
First half of 2018
Record order volumes
Capacities in Europe fully utilized; further
transfer of work orders to China
Expansion into Latin America through new
holding in Sekoya of Brazil
BLISTair single-use powder inhaler earns World
Packaging Award
CHF million
2017 net sales by region
6% Switzerland
62% Rest of Europe
16% Americas
15% Asia
1% Rest of the world
CHF million % of net sales
CPH Presentation 13. September 2018 24
The CPH Group Consolidated Balance Sheet
in CHF million 31.12.2017 30.06.2018 ± in CHF ± in %
Liquid funds 80.2 74.6 -5.6
Other current assets 162.1 170.8 +8.7
Fixed assets 455.3 451.7 -3.6
Total assets 697.6 697.1 -0.5 -0.1
Current liabilities 105.4 108.6 +3.2
Long-term liabilities 195.9 194.3 -1.6
Equity 396.2 394.2 -2.0
Total equity and liabilities 697.6 697.1 -0.5 -0.1
CPH Presentation 13. September 2018 25
The CPH Group Consolidated Cash Flow Statement
in CHF million FY 2016 FY 2017 ± in % H1 17 H1 18 ± in %
Net result (including minorities) -7.7 16.2 n.a. -2.2 22.6 n.a.
Depreciation, amortization, change in
provisions 36.0 -1.7 14.8 10.8
Cash flow 28.3 14.5 -48.8 12.6 33.4 +164.4
Change in net working capital -6.4 17.7 9.1 -5.7
Cash flow from operating activities 21.9 32.2 +47.0 21.8 27.7 +27.2
Cash flow from investment activities -19.9 -19.3 n.a. -11.6 -26.8 n.a.
Free cash flow 1.9 12.9 +563.4 10.2 0.9 -91.5
Financial and other long-term liabilities 18.8 0,6 0.6 -3.1
Dividends to shareholders -3.6 -3.9 -3.9 -3.9
Cash flow from financing activities 15.2 -3.3 n.a. -3.3 -7.0 n.a.
Currency translation effects 0.1 0.2 -0.2 0.6
Net change in cash and cash equivalents 17.2 9.8 -43.0 6.7 -5.6 n.a.
CPH Presentation 13. September 2018 26
The CPH Group Net Debt and Leverage
Net financial debt in 2017 (CHF in millions)
6,6x
2,2x 2,2x
1,2x
–
2,0x
4,0x
6,0x
8,0x
2015 2016 2017 H1 18
Net debt / EBITDA
Comments
Leverage strongly reduced over the past two years
Net debt reduced by 11% in 2017 (82.1 => 73.1)
Net debt H1 18 close to 2017 level despite CHF 24.5
million investments in business activities
H1 18 Free cash flow before investments in business
activities on high level (CHF 25.4 million)
Leverage development
153,3 80.2
73,1
0
50
100
150
200
Financialliabilities
Liquid funds +securities
Net financialdebt
149,8 74.6
75,2
0
50
100
150
200
Financialliabilities
Liquid funds +securities
Net financialdebt
Net financial debt in H1 18 (CHF in millions)
CPH Presentation 13. September 2018 27
Packaging
Further expansion of
production in Asia
Integration of Sekoya and
entry into service of finishing
plant in Brazil
Positive business trends and
much-improved earnings
expected
Paper
Newsprint and magazine
paper prices expected to
remain stable, but demand
will continue to decline in the
medium term
Tangible improvements
expected in net sales and
earnings results
Chemistry
Conclusion of strategic
realignment
Transfer to Rüti of deuterated
product manufacture
Higher net sales and
substantially improved
earnings expected
Outlook Optimistic for 2018
CPH Group The newly-acquired companies should have a positive effect on net sales volumes in all three
business divisions. Provided currency exchange rates remain stable, the CPH Group expects to report
higher total net sales and an earnings result for 2018 as a whole that is a substantial improvement on
the previous year.
CPH Presentation 13. September 2018 28
Outlook Target Key Performance Indicators
Annual organic net sales growth of 3% in the medium term
Equity ratio of over 50%
EBITDA margin of over 10%
Liquidity of at least CHF 30-50 million
Long-term average capital spending of CHF 15-20 million a year
Dividend policy: payout ratio of 30-50%, depending on free cash flow
CPH Presentation 13. September 2018 29
Thank you for your attention
Any Questions