Roadshow - North America April Roadshow North America April 2012 CFO Gilles Maria and VP Thorkild Diness Jensen The Rockwool Group

Transcription

1 Roadshow North America April 2012 CFO Gilles Maria and VP Thorkild Diness Jensen The Rockwool Group 1

2 Forward-looking statement The statements on the future in this presentation, including expected sales and earnings, are associated with risks and uncertainties and may be affected by factors influencing the activities of the group, e.g. the global economic environment, including interest and exchange rate developments, the raw material situation, production and distribution-related issues, breach of contract or unexpected termination of contract, price reductions due to marketdriven price reductions, market acceptance of new products, launches of competitive products and other unforeseen factors. 2

3 The Rockwool Group 3

4 The Rockwool Group World leader in full performance insulation - thermal, acoustic & fire The world s second biggest insulation producer Turnover 2011 DKK 13,748 million of which 82% insulation and 18% other stone wool products Company founded in Insulation activities since 1937 Head office in Copenhagen Approx. 9,000 employees 26 factories in 17 countries. Sales points in more than 30 countries 4

5 Sales distributed on business area Insulation segment 82% 2011 Systems segment 18% ROCKFON GRODAN ROCKPANEL LAPINUS FIBRES 5

6 Sales distributed on countries Germany 15% Others 33% 2011 France 14% Great Britain 5% The Netherlands 8% Poland 6% North America 8% Russia 11% 6

7 Rockwool locations Sales office, administration, etc. Factory 7

8 Energy and climate as growth drivers 8

9 Sustainable housing key to solve the energy challenge 50% of world population live in urban areas. This will grow to 70% by 2030 Aircon will triple before 2030 (McKinsey/Vattenfall) CO 2 emissions from buildings will grow by 50+% by Mainly in North America and East Asia (IPCC) Affordable and Sustainable housing should be a main priority 9

10 Buildings are the biggest energy consumer and CO 2 polluter 33% of all energy in EU is used for transport 26% of all energy in EU is used by industry 41% of all energy in EU is used by buildings 2/3 of energy consumption in buildings is used for heating, cooling and ventilation 10

11 The lowest hanging fruit Insulation is the most profitable CO2 saving; examples from McKinsey study saved energy is better than new sources to replace fossil energy 11

12 Key drivers for the insulation market New build rates Legislation and stimulus packages to support low-energy construction and renovation Energy price level 12

13 New build rates Driven by Demographics M2 per inhabitant Macro-economics Urbanisation Under normal market conditions, the Rockwool Group s turnover will be 50/50 between new build and renovation in the West European core markets. Today, its more like 30% new build and 70% renovation 13

14 Energy efficiency of buildings: Solid trend creates superior growth Short-term stimulus packages for energy refurbishment Long term legal framework for energy renovation of buildings in EU Energy requirements for major renovations now includes all buildings, also <1,000 m2 Stricter energy requirements to building materials also when renovating Governments to set up control functions Codes for new buildings and their energy efficiency 2018/19: Net Zero-energy level for public buildings in EU 2020/21: Net Zero-energy level for all buildings in EU 14

15 EU leads the way in tightening of new build codes End 2018: Passive house level for public buildings End 2020: Passive house level for all buildings Denmark Roof 360mm Roof 585mm % Wall 190mm Wall 345mm Germany Roof 195mm Roof 425mm Wall 90mm % Wall 350mm 15

16 Rising energy prices will stimulate energy renovation Villa in Denmark from 1927 Renovation investment: DKK 157,000 Energy consumption before: 5,300 litres oil/year Energy saving: 57% CO 2 -reduction: 8 tonnes/year Oil price: DKK 10.1/l Saving: DKK 31,000/year Pay-back: 5 years 16

17 Segments, product properties and production 17

18 Main insulation areas Interior Sandwich panels Facade Technical insulation Flat roof Marine & Offshore 18

19 Thermal: Insulation comparatives (best-in class) to achieve a U-value of 0.1 in a pitched roof Expanded Polystyrene Mineral wool Polyurethane Phenolic foam Rockwool aerorock 355 mm 300 mm 220 mm 200 mm 190 mm 19

20 Product properties - Insulation Stone wool Glass wool Foam Melting point 1000 o C 600 o C Burns Load bearing capacity Compression ability during transport and storage (+) + - Sound absorption Moisture repellence + (+) + 20

21 Product properties and market segments FLEXIBLE PRODUCTS RIGID PRODUCTS Main applications: Residential, refurbishment and newbuild Main applications: Non-residential (flat roof, facade, foundation, sandwich panels), technical insulation, OEM 25 kg/m 3 Glass wool Key market: Flexible products Stone wool Key market: Flexible and Rigid products Foam plastics Key market: Rigid products 180 kg/m 3 21

22 The Rockwool production is capital intensive a new state-of-the-art plant producing 100,000 tonnes/year costs approx. 100 mill 22

23 Markets and sales 23

24 Energy prices 24

25 DKK million Roadshow - North America April 2012 Investments and acquisitions Maintenance CAPEX Capacity program Acquisitions 25

26 European insulation market 2011 Plastic foam 40-45% Other 5% Recticel (PUR) Kingspan (PUR, EPS) DOW (XPS) BASF (XPS) Thyssen (PUR) Market size EUR 6.5 bill Glass wool 25-30% Saint Gobain Knauf Uralita Stone wool 25-30% Rockwool International Paroc Knauf Saint Gobain 26

27 Western Europe (64% of 2011 sales) Overall, the DE, F and to a lesser extent Scandinavian markets show robust performance under the circumstances whereas NL, UK and ES are in a difficult situation The new build market remains depressed with only Germany and France showing significant activity 2012 debt crisis will keep level low Renovation activity drives the insulation market supported by high energy prices and effective public programs for energy efficiency improvement in buildings in some areas Germany still considering to expand its energy efficiency renovation program of EUR 1.5 bn. per year tax deductions for low-energy projects might be added 27

28 Central / Eastern Europe (10% of 2011 sales) The recovery seen in Poland since summer 2011 continues; markets in CZ and SK also showing improvements Both volumes and prices are recovering from a low level HU and most of ex-yugoslavia still in difficulties with little financing to support construction activities 28

29 Russian insulation market 2011 Plastic foam 29% Market size EUR 0.7 bill Glass wool 26% Stone wool 45% 29

30 Russia (11% of 2011 sales) The Russian market continues to grow substantially Energy refurbishment and fire safety remain focus areas for government spending New factory in Kazan region started production in January months ahead of original schedule The new Kazan facility will be sold out from day 1 as the Group s imports into Russia will be reduced at the same speed as local production increases Factory Volga project 30

31 North American insulation market 2011 Glass wool 45% Stone wool 4% Rockwool International A/S Fibrex Thermofiber IIG Market size EUR 4.1 bill. Owens-Corning Saint Gobain Johns-Manville Knauf Other 8% Plastic foam 43% Owens-Corning (EPS & XPS) Johns-Manville (EPS & XPS) DOW (EPS & XPS) 31

32 North America (8% of 2011 sales) Continued strong double-digit sales growth in North America US growth rate approx. twice as big as Canadian Factory DIY market is the big engine behind US sales with successful penetration of big box stores, lumber yards and general distributors We also expect soon to see a breakthrough in the flat roof market with stone wool systems far out performing currently used plastic foam concepts 32

33 DIY success The superior quality of Rockwool insulation is especially appreciated in the DIY segment: The building owner is the decision-maker! Products marketed on their fullperformance advantages: Thermal, acoustic, fire, water repellence, fitting properties. Successful entry into the US DIY market through distribution deal with Lowe s access to 227 DIY stores across 13 states mainly on the East coast of the United States. Lowe s has 1,300 outlets in total in NA. Home Depot is already a strong partner in Canada, and the cooperation in the US is in the start-up phase. 33

34 China and Southeast Asia Insulation market is completely unconsolidated with hundreds of producers Other 8% Glass wool 12% Plastic foam 72% Market size 2.5 bill. Stone wool 8% 34

35 Asia (5% of 2011 sales) Following the recent focus on fire safety in high-rise buildings in China, demand for non-combustible stone wool products has exploded. Our 4 factories in South East Asia are sold out The Group is importing increasing amounts of building insulation from Europe Chinese capacity of non-combustible insulation material (primarily slag wool) is estimated to be far above 1 million tonnes however the general product quality is inferior Sales office Factory 35

36 Rock the globe The Group has the financial resources to carry out the strategy despite the recent turmoil in the macro-environment. Global expansion both organic and acquisitive - within insulation, ceilings & cladding e.g. Asia, North America and Russia. Increased innovation speed to expand offering with new materials and more complete systems e.g. AeroRock, ETICS systems, RockShell etc. Improving the competitive base optimising the production platform and developing new process technologies. Stronger customer focus to offer the right solutions for refurbishment and newbuild. Strongly promote the unique product properties of Rockwool including its non-combustibility. 36

37 Fire safety Deadly fires are increasing the awareness of the need for fire safe solutions If insufficiently protected, combustible insulation exposed to fire may add speed and power to the spread of fire in a building Rockwool stone wool is noncombustible and cannot burn The global usage of non-combustible insulation is still too low in facades, roofs, and sandwich panels Tragic fire in high-rise building in Shanghai. 37

38 Financials 38

39 Net sales

40 Net sales per country In % of total net sales for the Group Growth Germany 16% 15% 10% France 14% 14% 15% Russia 9% 11% 45% Netherlands 9% 8% -2% North America 7% 8% 19% Polen 6% 6% 17% Great Britain 5% 5% 18% Asia 2% 5% 280% Others 32% 28% 15% 40

41 EBITDA for the period Q4 1, % 11% 0-29% -15% -11% -200 EBITDA Changes 41

42 DKK million Roadshow - North America April 2012 EBIT 42

43 DKK million Roadshow - North America April 2012 EBIT per business segment 43

44 DKK million Roadshow - North America April 2012 Financial items

45 DKK million Roadshow - North America April 2012 Profit after minority interests 45

46 DKK million Roadshow - North America April 2012 Change in working capital

47 DKK million Roadshow - North America April 2012 Debtors 1,600 1,400 1,200 1, ,499 1,299 1,322 1, Increase due to acquisitions 47

48 DKK million Roadshow - North America April 2012 Cash flow 2,700 2,400 2,100 1,800 1,500 1, ,200 1, , , ,285 1, Cash flow from operating activities Changes 48

49 Expectations 49

50 Expectations for 2012 Net sales is expected to increase by 5% in 2012 compared to last year Profit after minority interests for 2012 is forecast at more than DKK 600 million Investment expenditure excluding acquisitions is expected to be DKK 1,400 million 50

51 DKK million Roadshow - North America April 2012 Investments and acquisitions 2,700 2,400 2,100 1,800 1,500 1, Acquisitions Capacity Program Maintenance CAPEX 51

52 DKK million Roadshow - North America April 2012 Long term sales development e 16,000 14,000 12,000 10,000 8,000 6,000 4,000 2,

53 Percentage Roadshow - North America April 2012 Long term EBIT ratio e 20% 15% 10% 5% 0% 53