Investor & Analyst Conference Call

Transcription

1 Interim Financial i lreport H1/2015 Investor & Analyst Conference Call 06 August 2015 Investor Relations

2 Agenda. 1. Financials H1/ Review and outlook 2015 Page 2 SGL Group Investor Relations 06 August 2015

3 Performance Products. Substantial EBIT improvement despite lack of recovery in graphite electrodes in million H1/2015 H1/2014 Sales revenue EBITDA before non-recurring charges* EBIT before non-recurring charges* EBIT-Margin before non-recurring charges* (in %) EBIT Sales revenue down 1 %, (currency adjusted -10%) mainly due to lower volumes and prices in graphite electrodes Nevertheless, recurring EBIT increased by more than 10 million due to cost relief related to SGL2015 and lower raw material costs SGL2015 related restructuring charges amounting to 4.2 million in reporting period SGL2015 savings 13.8 million, thereof 4.6 million from SGL Excellence Page 3 SGL Group Investor Relations 06 August 2015 * Non-recurring charges of 4.2 million in H1/2015 and 4.3 million in H1/2014

4 Graphite Materials & Systems. Lower sales and earnings resulting mainly from big ticket order in H1/2014 in million H1/2015 H1/2014 Sales revenue EBITDA before non-recurring charges* EBIT before non-recurring charges* EBIT-Margin before non-recurring charges* (in %) EBIT Sales revenue down 7% (currency adjusted down 14%) Mainly driven by big ticket order in H1/2014 Continued strong demand for anode materials for Li-ion-batteries Weaker H1/2015 sales in Process Technology due to subdued order intake in 2014 Recurring EBIT declined by approx. 12 million due to Lower capacity utilization i Partially compensated by one-off gains from a land sale and insurance claims SGL2015 savings 6.3 million, thereof 4.1 million from SGL Excellence Page 4 SGL Group Investor Relations 06 August 2015 * Non-recurring charges of 0.6 million in H1/2015 and 0.4 million in H1/2014

5 Carbon Fibers & Materials. Substantial progress towards profitability in million H1/2015 H1/2014 Sales revenue EBITDA before non-recurring charges* EBIT before non-recurring charges* EBIT-Margin before non-recurring charges* (in %) EBIT Sales revenue increased by 13% (currency adjusted 7%) Significantly ifi increased sales contributions i from our proportionally consolidated d joint ventures with BMW Group (SGL ACF, 51% share) CF/CM benefited from improved demand from various customer industries Recurring EBIT turned positive Strong EBIT improvement at CF/CM due to better volumes and thus higher utilization Lower ramp-up costs and improved productivity for carbon fiber capacity expansion in Moses Lake and Wackersdorf (SGL ACF) as expected SGL2015 savings 2.3 million, thereof 1.0 million from SGL Excellence Page 5 SGL Group Investor Relations 06 August 2015 * Non-recurring charges of 0.1 million in H1/2015 and 0.2 million in H1/2014

6 T&I and Corporate. SGL2015 savings offset by various effects in million H1/2015 H1/2014 Sales revenue EBITDA before non-recurring charges* EBIT before non-recurring charges* EBIT Recurring EBIT nearly unchanged - savings from SGL2015 offset by higher consulting fees relating to Business Process Excellence initiative currency effects from the translation of USD based administrative expenses SGL2015 savings 3.5 million Page 6 SGL Group Investor Relations 06 August 2015 *Non-recurring charges of 0.6 million in H1/2015 and 14.8 million in H1/2014

7 Group. Improved EBIT reflects both operational improvements and lower non-recurring charges in million H1/2015 H1/2014 Sales revenue EBITDA before non-recurring charges EBIT before non-recurring charges Non-recurring charges EBIT Includes savings of 26 million from SGL2015 in H1/2015, of which approx. 10 million attributable to SGL Excellence Page 7 SGL Group Investor Relations 06 August 2015

8 Group. Improved result from continuing operations on flat sales demonstrates effectiveness of SGL2015 in million H1/2015 H1/2014 EBIT Results from investments accounted for At-Equity Net financing result Results from continuing operations before income taxes Income tax expense Results from continuing operations after income taxes Consolidated net result attributable to the shareholders of the parent company EPS, basic and diluted (in ) Result from investments accounted for At-Equity improves to break even level mainly due to Brembo SGL and lower costs related to SGL Lindner Substantial improvement in results from continuing operations after taxes despite non recurrence of 10 million positive one time effect in net financing result in H1/2014 (non exercise of investor put of 2009/16 convertible bond) Net result and EPS includes loss from discontinued operations totaling 65 million (of which 53 million impairment charge resulting from sale of aerostructures business) relating to HITCO (H1/2014: loss of 13 million) Page 8 SGL Group Investor Relations 06 August 2015

9 Balance sheet. Solid despite slight deterioration in million Total assets 2, ,170.3 Equity ratio (in %) Total liquidity Net financial debt Gearing (net debt/equity) Total assets declined ed slightly despite positive currency cy effects ects of 95 million Equity ratio declined slightly due to net loss of 85 million in the reporting period (including a loss of 65 million from discontinued operations) partially compensated by 16 million (after tax) gain on equity resulting from effect of increased discount factors for calculation of pension provisions in Germany (from 2% to 2.25%) 25%) and in the US (from 4% to 4.5%) Page 9 SGL Group Investor Relations 06 August 2015

10 Free cash flow. As anticipated in March/April 2015 Continuing operations in million H1/2015 H1/2014 Cash flow from operating activities Capital expenditures in property, plant and equipment and intangible assets thereof SGL ACF thereof SGL Group excluding SGL ACF Cash flow provided by other investing activities* Free cash flow Higher negative operating cash flow compared to prior year due to working capital buildup (mainly relating to lower trade payables due to reduced raw material costs as well as the declining investment spend and higher inventories) non-recurring cash out for USD hedges (relating to HITCO) Free cash flow from continued operations in expected range Page 10 SGL Group Investor Relations 06 August 2015 *Payments for capital contributions in investments accounted for At-Equity, proceeds from dividend payments and sale of intangible assets and property, plant and equipment

11 Agenda. 1. Financials H1/ Review and outlook 2015 Page 11 SGL Group Investor Relations 06 August 2015

12 July 7, 2015: Next step in strategic realignment process announced. Dedicated business models for different market requirements Accelerate growth mode by adapting processes and launching growth initiatives Implement commodity business model and prepare for strategic options Graphite Materials & Systems (GMS) Graphite specialties Process technology Carbon Fibers & Materials (CFM) Carbon fibers Composite materials Performance Products (PP) Graphite electrodes Carbon electrodes Cathodes Furnace linings Page 12 SGL Group Investor Relations 06 August 2015

13 Value creation through Transformation of Business Models. GMS/CFM PP Building an innovation and technologydriven materials and solutions business Increase share in exciting growth markets Build on fast developing economic trends Use pipeline pp of innovative products and engineered solutions Take advantage of preferential customer access Shift product mix to higher value add Expand technology base and process expertise Ensuring a globally leading commodity Performance Products business Increase competitiveness through further fixed asset optimization Continue to drive productivity improvements Optimize business model and processes Develop pricing strategy to reflect market fundamentals Prepare business to participate in expected industry consolidation Page 13 SGL Group Investor Relations 06 August 2015

14 July 20, 2015: Agreement on the sale of the composite aerostructures business of HITCO. SGL Group concluded an agreement with Toronto-listed Avcorp Industries Inc. (Canada) on the sale of HITCO s business of manufacturing composite structural parts for commercial and military aerostructures. HITCO s profitable materials division is not part of this transaction. Selling proceeds are negative but include substantial repayments of customer advance payments. Sale results in an impairment charge of 53 million on the HITCO assets held for sale recorded under discontinued operations in the income statement. The related cash outflow amounts to approx. EUR 40 million, of which the larger part will be payable on closing, and is expected at the latest by October 16, The cash outflow related to the sale of the aerostructures business of HITCO was not included in our free cash flow guidance from continued operations and will be recorded in the free cash flow from discontinued operations. Page 14 SGL Group Investor Relations 06 August 2015

15 Business unit outlook Savings drive improvement in PP. Lower ramp up costs in CFM Performance Products (PP): Sales expected on prior year level. Graphite electrode volumes lower than previous year. Raw material linduced dprice adjustments. Higher volumes in cathodes. Substantial percentage increase in EBIT driven by SGL2015 and raw material cost reductions. Recent currency development supportive for sales and EBIT Graphite Materials & Systems (GMS): Nearly stable sales, mid to high single digit million lower EBIT as a result of non-recurrence of big ticket order and weaker order intake in H1/2015. Continued strong demand from Li-ion-battery customers Carbon Fibers & Materials (CFM): Slightly higher sales and significant improvement in EBIT. Better volumes in both CF/CM and SGL ACF. Sales increase partially offset by crude oil based pricing of Fisipeacrylic fibers. EBIT improvement based on overall improved demand and lower ramp up costs at SGL ACF Corporate: Slightly higher costs despite strong contributions from SGL2015 mainly due to consulting costs for Business Process Excellence initiatives Page 15 SGL Group Investor Relations 06 August 2015

16 Group outlook Net profit to benefit from improved EBIT and lower restructuring expenses Full year Group sales expected stable - lower prices resulting from reduced raw material costs, compensated dby currency gains and better demand d in Business Unit itcfm. No relief in near term expected for graphite electrodes due to continued Chinese steel export growth Group recurring EBITDA and EBIT: substantial percentage increase. ROCE to improve in line Restructuring costs: SGL2015: mid double digit million savings. As most SGL2015 measures implemented, only single digit million SGL2015 related restructuring expenses remain. Mid double digit million restructuring cash- out Total restructuring costs will from H2/2015 onward include one-time expenses associated with transformation of business models as announced on July 7, 2015 and amount to a low double digit million amount (including SGL2015 related restructuring costs) Net result to improve due to better EBIT and lower restructuring expenses, but remains negative Capex for the first time in many years to decrease to at most D&A level of approx. 90 million Free cash flow: Continued operations: improvement impeded due to expected cash out for anticipated tax settlement in H2/2015. However, the largest part of the negative free cash flow has already occurred in H1/2015 Discontinued operations: Sale of aerostructures business and related payments increase negative free cash flow Page 16 SGL Group Investor Relations 06 August 2015

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