WACKER The Next Five Years

Transcription

1 CREATING TOMORROW`S SOLUTIONS WACKER The Next Five Years Wacker Chemie AG, November 2013

2 Disclaimer The information contained in this presentation is for background purposes only and is subject to amendment, revision and updating. Certain statements and information contained in this presentation may relate to future expectations and other forward-looking statements that are based on management's current views and assumptions and involve known and unknown risks and uncertainties. In addition to statements which are forward-looking by reason of context, including without limitation, statements referring to risk limitations, operational profitability, financial strength, performance targets, profitable growth opportunities, and risk adequate pricing, other words such as "may, will, should, expects, plans, intends, anticipates, believes, estimates, predicts, or continue", "potential, future, or further", and similar expressions identify forward-looking statements. By their nature, forward-looking statements involve a number of risks, uncertainties and assumptions which could cause actual results or events to differ materially from those expressed or implied by the forward-looking statements. These include, among other factors, changing business or other market conditions and the prospects for growth anticipated by the Company's management. These and other factors could adversely affect the outcome and financial effects of the plans and events described herein. Statements contained in this presentation regarding past trends or activities should not be taken as a representation that such trends or activities will continue in the future. The Company does not undertake any obligation to update or revise any statements contained in this presentation, whether as a result of new information, future events or otherwise. In particular, you should not place undue reliance on forward-looking statements, which speak only as of the date of this presentation. WACKER - The Next Five Years, November

3 Our Business Portfolio: A Foundation for Growth WACKER BIOSOLUTIONS High potential for future development WACKER POLYMERS WACKER SILICONES Strong no. 3 with global footprint Leading positions in key growth segments No. 1 in dispersible polymer powders No. 1 in VAE dispersions Global footprint *) FY 2012 Sales 4.6 bn WACKER POLYSILICON No. 1 Cost and quality leader Enabling industry growth Siltronic Technology leader, ranking as no. 3 Balanced base of customers Note: Percentages based on external sales per segment *) Others WACKER - The Next Five Years, November

4 Strong Track Record: Expecting Strong Growth into 2017 Long Term Historic Sales Growth m 7,000 6,000 5,000 4,635 m ~6% CAGR Target 2017: bn 4,000 3,000 2,000 1, WACKER - The Next Five Years, November

5 The Next Five Years: Introducing Financial Targets Target 2017 Sales EBITDA bn (~6% CAGR)* 1.2 bn (~20% margin) ROCE > 11% * CAGR 2012/2017 WACKER - The Next Five Years, November

6 Entering the Next Phase: From Asset Growth to Cash Generation Ratio of Capital Spending vs. Depreciation capex between 1.3 and 2.2x depreciation capex < depreciation capex >< depreciation Create Focus on capital intensive growth: Eight additional sites globally Increased capacities 7x in Polysilicon, 3x in VAE dispersions, 2x Siloxane, 6x 300 mm wafer The customer dimension: Global presence and market penetration with technical centers and global sales structures Leverage Focus on profitability and cash: Execute cost roadmaps Leverage global asset base Focus on quality growth, growing specialty sales Invest below depreciation Expand Focus on selective expansion of production network: Selective growth projects Exploring further Verbund and debottlenecking opportunities WACKER - The Next Five Years, November

7 Positioned for Sustained Sales and Earnings Growth WACKER: A Leading Specialty Chemicals Company Advanced Materials Tech-based products ranging from standard to high value added Focus on innovation and customized solutions Compelling Growth Addressing high-growth markets Local presence in all regions Capitalizing on emerging markets growth Strong Cost Position World-scale plants, integrated production, proprietary process know-how Targeted cost reduction programs implemented Significant CapEx program concluded, now leveraging a global asset base Leading Market Positions A global leader in most addressed segments and markets particularly at the individual customer level WACKER - The Next Five Years, November

8 Create: Global Market Presence Technical Center & WACKER ACADEMY Market Penetration in all Emerging Regions China Local products and services Chino Nünchritz Canton, OH Adrian Burghausen Jandira Moscow Beijing Akeno Dubai Kolkata Seoul Shanghai Mumbai Shunde Singapore Melbourne Korea Focus on products for the electronic market India Focus on textile applications Brazil Expanding Technical Center presence, local products and services 22 Technical Centers worldwide to service customers and develop products & applications 9 WACKER ACADEMY sites provide training and product know-how tailored to our customers needs. South East Asia Mobile technical center Sales TC Academy Plant WACKER - The Next Five Years, November

9 Create: Sales Network and Customer Relations - Building a Sustainable Competitive Advantage Chemicals: Establishing a global network of technical centers Global sales network to create and develop specialty solutions Leveraging centralized upstream facilities into local growth opportunities Customer focus drives product evolution WACKER POLYSILICON: Addressing the solar opportunity with specialized production technologies Supplier of choice, leading in quality and cost Siltronic: Improved global production footprint for 300mm Repeated Quality Award wins from industry leaders WACKER - The Next Five Years, November

10 Leverage: Shifting Focus to Downstream Products Raw Material Upstream Downstream Customers Industries Methanol Silicon Metal Siloxane Pyrogenic Silica Silicones Construction Automotive suppliers Paints and coatings Textiles, print and paper Personal care Polysilicon Solar wafers, cells and modules Electronic wafers Semiconductors Ethylene Acetic Acid Vinylacetate Monomer (VAM) Vinylacetate ethylene (VAE) Dispersible Polymer Powders (DPP) Polyvinyl Acetate (PVAc) Engineered fabrics, coatings, adhesives, carpet Construction, remodeling, insulation Food, automotive Starch/ Dextrose Microbiological fermentation Therapeutic proteins food ingredients Food, life sciences, household WACKER - The Next Five Years, November

11 Chemicals: The Way Forward Strong and well established global market presence Growth opportunities in emerging markets Addressing global trends with advanced chemical products Leveraging existing upstream capacities will reduce capital intensity of growth Continuous productivity improvements and Verbund production support cost competitiveness Target 2012 to 2017: Sales growth ~7% CAGR / EBITDA margin >16.0% WACKER - The Next Five Years, November

12 SILICONES: An Integrated Global Player in a Leading Market Position Supply Chain Sales Development ( m) 5 years 2 raw materials 7 product groups Siloxane Methanol Silicon Metal Silanes Resins Fumed Silica OF Silanes 1,600 1, ,409 1,239 1,581 1,594 1,648 Fluids & Emulsions Elastomers 400 > 3000 products & endless applications Competitive Landscape 2012 Evonik 4% Bluestar 6% Shin Etsu 12% Others 9% 9.9* bn WACKER 16% 29% Dow Corning 37% Market Characteristics Reduced cyclicality through broad market penetration and wide customer base Historic growth rates 3% above worldwide GDP High entry barriers (capital and technology) Key drivers spur sustainable market growth Innovations broaden scope of applications Momentive 16% * Silane/Siloxane backward integrated suppliers; WACKER participations fully consolidated WACKER - The Next Five Years, November

13 Customization: Combining a Unique Set of Properties Hydrophobic Formable Adhesive Electrically conducting Broad spectrum of adjustable properties Intrinsic properties Thermal stability UV-resistant Inert, Chemical resistant amongst others Hydrophilic Form stable Release Insulating Silicones are high performance products, suitable for multiple applications WACKER - The Next Five Years, November

14 Outstanding Optical Transparency and Processing ability of Silicones allow New Applications in Industries like Automotive Challenge Our solution Development lighting technologies (in%) Incandescent Halogen HID CFL/LFL LED 2016 LED lighting technology is the main driver of growth in the general lighting market Silicones are the material of choice due to their unique properties and are superior to PMMA or PC (esp. non-yellowing) Advantages of LUMISIL LR 7600 Outstanding optical transparency No yellowing Highly flexible, heat and weatherresistant, guiding Excellent processing Application: optical elements for LED, lenses Source: McKinsey s Global Lighting Market Model, Lighting the Way WACKER - The Next Five Years, November

15 Specialty Focus Creates Value Standards Exchangeable Price elastic Specialities Specified properties Value based pricing Standards Business Strategy Low requirement for technical service Increase our specialty business to 50% of Siloxane volume within 4 years Technical service is a key success factor Customized solutions Sell standards with low cost to serve Siloxane Volume Specialties 33% Specialties 50% Standards 67% 2012 Standards 50% 2017 WACKER - The Next Five Years, November

16 SILICONES: Growth Target 6% with Improved Profitability Our Roadmap Value creation We push our specialty business by investing in downstream production and service close to our customers 2 Innovation We permanently investigate opportunities for organic replacement to open up new markets for silicones 3 Cost We continuously improve our cost position through operational excellence WACKER - The Next Five Years, November

17 POLYMERS: Global Leader in High Growth Markets Supply Chain Sales Development ( m) 5 years Raw Material Upstream Downstream Key Markets Acetic Acid & Ethylene VAE VAM Dispersions PVAc VAE = Vinyl acetate ethylene, VAM = Vinyl acetate monomer, PVAc = Polyvinyl acetate, PVOH = Polyvinyl alcohol DPP = Dispersible Polymer Powders DPP PVOH Construction Nonwovens & Textiles Adhesives Carpet Coatings & Paints 1, , Capacity Landscape 2012 (Capacities)* Others 2 nd in the market Dispersible Polymer Powders WACKER Others VAE Dispersions 2 nd in the market WACKER Market Characteristics Diverse market and customer base Historic growth above GDP Key trends, innovation and new applications drive growth Moderate capital entry barriers and high technology barriers in most segments Innovations and in-depth formulating expertise broaden scope of applications Source: WACKER estimates WACKER - The Next Five Years, November

18 Innovation: In Close Cooperation with Customers Target: Unique Performance / Cost Ratio Ceramic Tile Adhessives ETICS* 1K water proofing membrane Vinyl Acetate Ethylene Shotcrete Powder Asphalt Blend Self Levelling Compounds Skim Coat Transformation Transformation Dispersion Asphalt Traditional systems 2K water proofing membrane Concrete Styrene Butadiene Latex Mortar Concrete Asphalt * ETICS = External Thermal Insulation Composite Systems WACKER - The Next Five Years, November

19 Substitution: Application Overlap as Opportunity for Substitution ~1,600 kt 6% 10% 15% 32% ~16,700 kt Other* ~3,900 kt 4% 64% 34% Vinyl Acetate Ethylene 2006 VAE market Total 2009market SBL market % 23% Styrene Butadiene Latex 19% 6% 2% 5% Construction Adhesives Coatings Nonwovens Carpet Paper Other Sources: Kline; F&S-study Strategic Assessment of the World Emulsion Polymer Markets 2012; WACKER analysis * Other: Pure acrylics, styrene acrylics, PVAc, vinyl acrylics, VA-copolymers WACKER - The Next Five Years, November

20 Polymers Targets Continued Growth of 8% p.a. Our Roadmap Expansion We invest in downstream production and service close to our customers 2 Innovation We push new solutions beyond our core, working in a global set-up with our R&D activities 3 Substitution We explore new substitution opportunities in the non VAE systems WACKER - The Next Five Years, November

21 BIOSOLUTIONS: Focusing on Attractive Niches Supply Chain Raw Material Upstream Downstream Key Markets Stach/Dextrose Ethylene Ketene Biologics Cyclodextrins / Cysteine Gumbase Chem. Intermediates Biopharmaceuticals Food & Flavor/ Pers. & Home Care Life Sciences Business Structure Nutrition / Gum 60% Food and Cosmetics Cyclodextrins, cystine/cysteine as food ingredient, encapsulated coenzyme Q10 Gumbase Gumbase resin for chewing gum production Sales 2012: 158 m Biopharmaceuticals 6% Drugs Custom manufacturing of biologics with strong technology and IP position Pharma/Agro 35% Example acetyl acetone & methyl acetate Fine chemicals, building blocks & silanes for drugs or pesticides WACKER - The Next Five Years, November

22 Global Trends Chemicals: Enhancing Quality of Life BELSIL Growing population & rising welfare in emerging countries Increasing sales of personal care products Our contribution: BELSIL for gloss and feel Silicone Fluids & Emulsions in Personal Care Living Comfort Urbanization Mobility ELASTOSIL LR Airbags in cars = Safety first Silicones used as an airtight coating of woven fabrics Low flammability Our contribution: ELASTOSIL LR Silicone liquid rubber for the Automotive Industry VINNAPAS dispersions/dispersible powders Buildings consume 40% of primary energy Need to reduce consumption of heating energy Resource Savings Our contribution: VINNAPAS dispersions and dispersible powders for external thermal insulation WACKER - The Next Five Years, November

23 Reduce Capital Intensity of Growth Leverage Existing Upstream Capacities Upstream Downstream Compounds & Formulations Global Regional Local Silicon Metal Siloxane VAM Elastomers Emulsions & Fluids Resins VAE dispersions Dispersible Powders Compounds SILMIX Emulsions Capital Intensity Value Creation growing share of specialties from 2/3 to 3/4 of sales WACKER - The Next Five Years, November

24 Chemicals: Continuous Productivity Improvements Chemicals Burghausen Site Specific Operating Costs ( /ton) Specific Energy Consumption (kwh/ton) Labor Productivity (kg/h) -13% -24% +11% savings of 100 m in specific operating costs achieved WACKER - The Next Five Years, November

25 POLYSILICON: The Way Forward Fast cost decrease in Solar PV unlocks growth Polysilicon Market: 12% growth expected ( ) Prices expected to rise to reinvestment levels Pricing differentiates between Polysilicon qualities Competitive pressure drives cost and conversion efficiency WACKER leads in cost and quality Cost reduction roadmaps implemented to maintain leading cost and quality position Target 2012 to 2017: Sales growth ~7% CAGR / *EBITDA margin >20.0% * excl. salt and fumed silica WACKER - The Next Five Years, November

26 POLYSILICON: Leading in Cost and Quality Production Chain Sales Development ( m) 5 years Raw Material Salt Silicon Metal Upstream Polysilicon Downstream Electronic wafer Key Markets Semiconductors 1,800 1, ,121 1,369 1,448 1,136 Hydrogen Solar wafer Solar Modules Competitive Landscape 2012 Others 14% LDK 2% MEMC 3% Tokuyama 3% 211 kt REC 10% OCI 14% WACKER 18% 29% GCL 19% Hemlock 17% Market Characteristics Strong market growth driven by increasing competitiveness of PV electricity Excellent product quality is key to highest conversion efficiencies in solar Cost and quality are both decisive for market success Intense competition drives industry consolidation Capacity surge has stopped Source: industry announcements; WACKER estimate WACKER - The Next Five Years, November

27 household power price POLYSILICON: Fast Cost Decrease of Solar PV Unlocks Growth Roof-top System Prices* LCOE & Electricity Price Off-grid Applications young market mature market Germany China TX CA PV becoming very competitive and easy-to-install PV can be built very fast and in small increments Steep price decline of storage solutions Cheap electricity for remote areas with no access to grid annual solar energy yield(kwh/kwp) US Germany Module BOS BOS = Balance of System *best practice Q /Wp 1.0 /Wp 0.5 /Wp size of electricity market Δ LCOE vs. power price = room for positive NPV (assumes full grid access) WACKER - The Next Five Years, November

28 Polysilicon Market: 12% Volume Growth Expected Global Polysilicon Shipments (kt) CAGR : 12% shipments decreased due to inventory correction in solar and lower consumption per watt PV now competitive with most other sources of electricity both renewable and fossil fuels 92 Silicon-based PV enables highest conversion efficiencies and proven long-term stability at lowest cost Electronic Solar Assumptions: 2017: 75 GW (incl. 10% thinfilm share); Silicon Consumption 5.0 g/wp in 2017; Shipment figures incl. time-delay shipment/installation Source: WACKER analysis WACKER - The Next Five Years, November

29 Current Market Price Limits Polysilicon Supply Global Polysilicon Demand (kt) versus Capacity of still Active Manufacturers PV market: 2013: ~34-40 GW 2014: ~40-50 GW Only a limited number of producers still operating Further capacity expansion plans halted / significantly delayed Pricing sets high entry barrier for new entrants Capacity Announcements Active Capacities Total Demand (High Case) Total Demand (Low Case) Electronic Demand Sources: market surveys, industry announcements, WACKER estimate WACKER - The Next Five Years, November

30 Different Polysilicon Qualities Sell for Different Prices Impact of Polysilicon Quality on Prices 140% High Quality Polysilicon 120% Key to improved wafer performance: 100% 100% Higher charge carrier lifetime 80% 60% 40% 20% 0% High Quality (Fe: 9-10N) 75% Medium Quality (Fe: 8-9N) 50% Low Quality (Fe: 6-7N) Improved resistivity Higher ingot yields Improved recycling of polysilicon Lower wafer production costs Precondition for high cell efficiencies, resulting in: Reduced BOS Cost per Watt 60% 30% 10% Lower LCOE Market Share Source: WACKER estimates, price data based on import statistics and industry sources WACKER - The Next Five Years, November

31 Number of cells Competitive Pressure Drives Cost and Conversion Efficiency WACKER Leads in Cost and Quality Usable Ingot Length (%) Solar Cell Efficiencies (%) Cell Efficiency Distribution 100% Production Costs (%) 25 Mainstream Multi Mainstream Mono Super Mono high-purity Polysilicon low-quality Polysilicon 86% 76% 66% 20 cells with price discount cells with price premium 15 Ingot Yield 60% 70% 80% 90% Cell efficient Higher quality longer usable length lower cost per wafer Higher quality supports greater efficiencies lower cost per wafer Narrow distribution and higher mean lower cost per wafer Source: WACKER estimates WACKER - The Next Five Years, November

32 POLYSILICON Expansion Tennessee (Poly 11): Establishing a Platform for Future Growth in the US Tennessee 20kt p.a. Lower Electricity Cost in the US (indexed) 100 Germany = Electricity Price + FiT Surcharge (2013) + Grid usage fee + Other charges US = List price TN provider Feb Planned ramp up of Polysilicon production in Currency diversification for the Group Growth platform for chemical products in the USA Germany (Industry High- Voltage) USA (TN) Assumptions: Data based on Year end 2012, USD/EUR: 1.35 Source: WACKER estimates, market data WACKER - The Next Five Years, November

33 POLYSILICON: Strong Focus on Cost and Productivity Specific Energy Consumption (kwh/kg)* Labor Productivity (kg/h)* Index = % Index = % e New deposition reactors New conversion reactors New process design e Economies of scale Yield improvements Automation * solar polysilicon process only, indexed weighted ø of all plants * total average for all sites, direct labor including analytics WACKER - The Next Five Years, November

34 POLYSILICON: Maintain Leadership in Cost and Quality Our Roadmap Cost Competitive pressure drives module cost and conversion efficiency Cost reduction roadmap implemented to maintain WACKER s leading cost position 2 Quality C-Si-PV moving towards efficiencies above 20% (module) Pricing differentiates between polysilicon qualities 3 Customer Develop products for all crystallization technologies in close cooperation with our customers Keep broad customer portfolio to react flexibly on market changes Expand capacities according to market demand WACKER - The Next Five Years, November

35 Siltronic: The Way Forward Rising demand for 300 mm Continuous cost reduction programs in place Customer focus recognized for outstanding performance Siltronic strategy - Focus on cash generation Target 2012 to 2017: Sales growth ~2% CAGR / *EBITDA margin >20.0% * pro forma, excluding restructuring 2012 WACKER - The Next Five Years, November

36 Siltronic: Focusing on 300 mm and Asia Value Chain Sales Development ( m) 5 years WACKER Polysilicon Ingots Siltronic Wafer Key Markets Semiconductors 1,600 1, , , Sales Semi Sales non Semi Competitive Landscape 2012 Silicon Wafer Market Share (on USD basis) Global Wafers 6% Others 5% Siltronic 14% LG / Siltron 10% Sun Edison 10% S.E.H. 28% SUMCO Group 28% Source: Gartner (June 2013) Market Characteristics Semi and silicon wafer markets move in tandem Historic silicon market growth of 8-12% CAGR with last 3 years moving sideways High volatility both annually and quarterly 300 mm continues to grow while legacy diameter are trending down PC era coming to an end. Market growth increasingly coming from smartphone and tablets. Source: Siltronic estimates WACKER - The Next Five Years, November

37 Siltronic: Growing Demand for 300 mm Wafer Market by Diameter (million cm²) 3,500 ~ 4 % 3,000 2,500 2,000 1,500 < 0 % 1,000 < 0 % SD 200 mm 300 mm CAGR mm volume continues to grow as smaller diameters are substituted Source: SEMI; SD = Small Diameter WACKER - The Next Five Years, November

38 Siltronic: 300 mm Continuous Cost Reduction Program Siltronic 300 mm Variable Costs, relative per Wafer -9% -12% Targeting annual cost declines in variable costs of 10% for the next two years WACKER - The Next Five Years, November

39 Siltronic: Singapore JV with Samsung for 300 mm Siltronic Samsung Wafer Pte. Ltd. (SSW) Joint Venture with Samsung (50:50) Siltronic has an option on the majority of the venture Further capacity increase from debottlenecking possible JV consolidated at-equity: dilutes Siltronic performance representation Assuming full consolidation of the JV, Siltronic pro-forma results*: ( m) Sales 1,125 1,030 EBITDA Capacity: >300 kw/m EBITDA % * excl. restructuring WACKER - The Next Five Years, November

40 Siltronic Strategy: Focus on Cash Generation Create High capital intensity 300 mm expansion Strengthen market position with JV Leading edge technology Harvest 2013 onwards Focus on 300 mm in Asia No 450 mm investment Continue rationalization outside of Asia CapEx below depreciation CapEx above depreciation Strategy: Focus on low capex and 300 mm in Asia WACKER - The Next Five Years, November

41 WACKER: The Way Forward Financial Targets for 2017 Financial Stability & Profitability Summary: The Path to 2017 Outlook 2013 WACKER - The Next Five Years, November

42 WACKER Financial Targets for 2017 Sales of bn with Profit Above Costs of Capital 2012 current 2013 guidance 2017 target Sales 4,635 ~ 4,500 6,000 6,500 CAGR ~6% EBITDA 795 lower 1,200 Margin 17% lower ~20% ROCE 5% lower > 11% CapEx (% of sales) 24% ~ 500 Below depreciation WACKER - The Next Five Years, November

43 Balance Sheet: Financial Stability Target Capital Structure Group Balance Sheet Target Structure 2017 Drivers Drivers : CapEx below depreciation Non-current assets Equity Equity ratio: Historical level ~40% Dividend policy: in general, minimum 25% of net income Depreciation of certain polysilicon assets accelerated from 2012 onwards Financial debt incl. prepayments Prepayments almost fully repaid by 2017 Target: Net financial debt = 1x EBITDA DIO: ~50 days and DSO: ~50 days despite increasing globalization Minimum level for operations Working capital Liquidity Pension provisions Liabilities / other accruals Impact of IAS 19 considered WACKER - The Next Five Years, November

44 Profit & Loss Statement: Improving Profitability through 2017 WACKER P&L 2012* ( m) Targeted Development until 2017: m 2012* Sales 4,635 Cost of goods sold -3,815 Gross profit from sales Gross profit margin (in %) Selling expenses Research and development expenses General administrative expenses Other operating income Other operating expenses % Operating result 349 Equity result -83 EBIT 267 Interest result Other financial result Income before taxes 204 Income taxes -89 Net income for the period 115 EBIT 267 Depreciation/amortization 529 EBITDA 795 Gross profit margin with increase of up to 300 bps, driven by Accelerating growth in specialties Improving market environment in POLYSILICON Lower D&A in relation to sales Limited overhead growth SG&A to decrease to less than 7% of sales EBIT growth compensates higher interest expense Tax rate well above 50% in 2013, reverting back to statutory tax rate mid-term (~30%) Prior to Poly 11 ramp-up: Tennessee investment reduces ROCE by up to 150 bps * adjusted based on the effects of the adoption of IAS 19 (revised) WACKER - The Next Five Years, November

45 Measures Aggressive Cost Roadmaps in all Businesses Chemicals POLYSILICON Siltronic WOS WACKER Operating System: targeting continuous cost decrease in specific operating costs Raw material and energy cost: optimized yields, loss reduction, raw material and energy recovery, process optimization Labor: reduce set-up times and non-value-added activities Logistics: lean processes, optimized packaging Technical spending: optimize inspection cycles, spare part storage Asset utilization: debottlenecking Raw Materials: expanded supplier portfolio Supplies: expanded supplier portfolio Electricity: reduced consumption in major process steps (conversion, deposition) Personnel Expenses: continuous productivity improvement Maintenance Expenses: standardization, spare parts logistics (sourcing/storage level) Process yield enhancement Raw materials and energy costs: optimize specific raw material and energy consumption, increase yield Supplies: reduce consumption of supplies Labor: reduce personnel costs, set-up times Site loading rules Process optimization across the entire value chain Total expected cost savings 2013: 200 m WACKER - The Next Five Years, November

46 Price Decline of ~ 1 bn within Two Years (20% of Sales) Mainly in POLYSILICON WACKER Group: Sales Development ( m) 5,000 4,500 4,000 4, ,635 ~350 ~4,500 3,500 3,000 2,500 2,000 1,500 1, Price Volume Currency Spalte Price Volume Currency 2013e WACKER - The Next Five Years, November

47 CapEx: 2013e Reduced by 54% vs CapEx vs. Depreciation Expense WACKER Group ( m) 1, % ~ 550 ~ 500 ~ 600 ~ 400 Ø e Ø 2014e-2017e Depreciation CapEx (asset additions) WACKER - The Next Five Years, November

48 Net Cash Flow*: 2013e Net Cash Flow Significantly Improved vs Net Cash Flow* ( m) , ~ 500 > Ø e Ø 2014e-2017e Gross cash flow CapEx (cash flow) Net cash flow* * prepayments not considered WACKER - The Next Five Years, November

49 Financial Debt incl. Prepayments to be Reduced over Leverage Phase Development of Financial Indebtedness ( m) 1,749 1,107 1, reduction 864 1, < Ø e 2014 et seqq. Net financial debt Prepayments (Group) WACKER - The Next Five Years, November

50 Prepayments: ~ 1 bn in Balance Sheet Reduction of 200 m p.a. Expected POLYSILICON Prepayments ( m) 1, ,012 1, m p.a e et seqq. Retained prepayments and damages from cancelled contracts to continue with effects on earnings as market consolidation takes place Expecting prepayments to decline by ~ 200 m p.a. WACKER - The Next Five Years, November

51 The Path to 2017: WACKER Is an Attractive Investment Advanced Materials Compelling Growth Strong Cost Position Leading Market Positions Leading market shares and global presence Lower CapEx Growing share of chemicals specialty products Well defined cost roadmaps Well positioned to harvest the solar opportunity 2017 Sales bn (~6% CAGR) EBITDA 1.2 bn (~20% margin) ROCE >11% WACKER - The Next Five Years, November

52 Outlook 2013 unchanged: FY Sales about 4.5bn, Net Income slightly positive Group Chemicals Siltronic POLYSILICON Investments Net Cash Flow Expecting Group sales at 4.5 bn for the full year 2013 FY EBITDA below last Year All segments with positive outlook and solid trend FY 2013 slightly better than yoy in sales and EBITDA FY sales below 2012 Cost roadmap for 300 mm on track FY sales below 2012 Substantial contribution to Group EBITDA but below 2012 CapEx of 500 m NCF positive Net financial debt below 900 m Net income slightly positive FX Assuming ø exchange rate for Q4 of $/ at 1.35 WACKER - The Next Five Years, November

53 CREATING TOMORROW`S SOLUTIONS 3 rd Quarter 2013 Call Note Wacker Chemie AG, November 2013

54 WACKER: Sales Growth Restrained by Price Pressure in m Q Q % QoQ Q3 2012* % YoY Sales 1, , , EBITDA EBITDA margin 14.4% 16.4% % - EBIT EBIT margin 3.0% 4.6% - 6.0% - Result for the period EPS in *Adjusted based on the effects of the adoption of IAS 19 (revised), more details under changes in accounting and evaluation methods in the notes (quarterly report) WACKER - The Next Five Years, November

55 Strong Cash Flow Generation in Q3: NCF Increases to 165m WACKER Q Comments Lower growth in chemicals than expected due to weaker economies Negative FX effect yoy (USD, YEN) in Chemicals and Siltronic Pricing pressure leads to negative effect of about 109 m yoy Savings in material, energy and personnel expenses Lower inventory effect in POLYSILICON damped EBITDA margin Strong NCF of 165 m Capex of 98 m with focus on POLYSILICON (USA) 2013 Challenges and Opportunities Lower ASP s than in 2012 FY sales dampened by some 350 m price decline, thereof 50 m in Q4 expected Increase of tax rate above 50% WACKER - The Next Five Years, November

56 Impacts of Special Effects on EBITDA in Q vs. Q Division ( m) Special Effects Q1 Q2 Q3 Q1 Q2 Q3 Siltronic Execution "Lead site strategy" WACKER POLYSILICON Retained prepayments & damages from cancelled contracts Net Effect on EBITDA WACKER - The Next Five Years, November

57 FY 2013 Net Debt now Expected below 900m Balance Sheet (%) Characteristics 09/30/13 Assets Total 6.6 bn 6.5 bn 12% 8% Liabilities Total 6.6 bn 6.5 bn Noncurrent assets: 4,431m Securities, cash and cash equivalents: 788 m 22% 23% 33% 33% Provisions for pensions: 1,172 m Net financial debt: 688 m 18% 19% Equity: 2,167 m Securities, Cash & Cash E. Current Assets Noncurrent Assets 66% 69% 09/30/1312/31/12 14% 16% 13% 14% 22% 18% 09/30/1312/31/12 Equity Pension Accruals Prepayments Accruals & Liabilities Financial Debt Prepayments received per 09/30/13: 893 m Capex: 351 m (Q3: 98 m) 2012: Adjusted based on the effects of the adoption of IAS 19 (revised), more details under changes in accounting and evaluation methods in the notes (quarterly report) WACKER - The Next Five Years, November

58 09/11 01/12 05/12 09/12 01/13 05/13 09/13 09/11 01/12 05/12 09/12 01/13 05/13 09/13 Raw Materials: Slight Relief Expected in 2013 Ethylene Contract ( /MT) Si-Metal Contract ( /MT) Raw Materials 2012 ( m) Chemicals 1,400 2,800 Others Si Metal 1,300 2,600 1,200 2,400 1,100 2,200 VAM* Ethylene 1,000 2,000 Methanol 900 Source: ICIS, Ethylene Market Price Europe, free delivered 1,800 Source: Source: CRU-Provider, Si-Metal Contract Price Europe free delivered Costs of top 4 raw materials 21% of chemicals segment sales *VAM = Vinylacetate monomer WACKER - The Next Five Years, November

59 09/11 11/11 01/12 03/12 05/12 07/12 09/12 11/12 01/13 03/13 05/13 07/13 09/13 1 Cent Change in USD/ Exchange Rate had an Impact of 4.4 m on FY-EBITDA in 2012, Unhedged* USD/EURO Development 1.40 External Sales and Net USD Exposure 1.35 Chemicals 157 2, Polysilicon Siltronic External Sales FY 2012 Net USD Exposure FY 2012 Source: *Standard Hedging policy = 50% of net exposure, 12 months rolling forward WACKER - The Next Five Years, November

60 Chemicals Impacted by FX and lower Prices Sales in m Q Q %QoQ Q3 2012* %YoY CHEMICALS WACKER SILICONES WACKER POLYMERS WACKER BIOSOLUTIONS WACKER POLYSILICON Siltronic Others Consolidation , , , *Adjusted based on the effects of the adoption of IAS 19 (revised), more details under changes in accounting and evaluation methods in the notes (quarterly report) WACKER - The Next Five Years, November

61 Polysilicon Influenced by Inventory Decrease EBITDA in m Q Q %QoQ Q3 2012* %YoY CHEMICALS WACKER SILICONES WACKER POLYMERS WACKER BIOSOLUTIONS WACKER POLYSILICON Siltronic Others n.a Consolidation n.a *Adjusted based on the effects of the adoption of IAS 19 (revised), more details under changes in accounting and evaluation methods in the notes (quarterly report) WACKER - The Next Five Years, November

62 WACKER: Issuer, Contact and Additional Information Issuer and Contact Additional Information WACKER CHEMIE AG Hanns-Seidel-Platz 4 D Munich Investor Relations contacts Mr. Joerg Hoffmann, CFA Tel joerg.hoffmann@wacker.com Mrs. Judith Distelrath Tel judith.distelrath@wacker.com Mrs. Manuela Ellmerer Tel manuela.ellmerer@wacker.com Financial Calendar 03/18/14 FY Results /05/14 Q1 Results /15/14 Annual Shareholders Meeting 07/31/14 Q2 Results /30/14 Q3 Results 2014 ISIN: WKN: Deutsche Börse: Ticker Bloomberg: Ticker Reuters: Listing: DE000WCH8881 WCH888 WCH CHM/WCH:GR CHE/WCHG.DE Frankfurt Stock Exchange Prime Standard WACKER - The Next Five Years, November