SEB Nordic seminar - Copenhagen, 8 January 2014
SEB Nordic seminar Copenhagen 8 January 2014 CFO, Gilles Maria ROCKWOOL International A/S
1
SEB Nordic seminar - Copenhagen, 8 January 2014
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 market-driven price reductions, market acceptance of new products, launches of competitive products and other unforeseen factors. In no event shall ROCKWOOL International A/S be liable for any direct, indirect or consequential damages or any other damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other action, arising out of or in connection with the use of information in this presentation.
2
SEB Nordic seminar - Copenhagen, 8 January 2014
The ROCKWOOL Group
World leader in stone wool
technology The world’s second biggest insulation producer Company founded in 1909.
Insulation activities since 1937 Head office in Copenhagen More than 10,000 employees 27 stone wool factories in 17 countries and ceiling grid plants in Europe, NA and Asia. Sales points in more than 40 countries
3
SEB Nordic seminar - Copenhagen, 8 January 2014
ROCKWOOL locations
X
Sales office, administration, etc. Stone wool factory Factory under construction
4
SEB Nordic seminar - Copenhagen, 8 January 2014
The ROCKWOOL production is capital intensive - a new state-of-the-art stone wool plant producing 110,000 tonnes/year costs approx. €120 mill
5
SEB Nordic seminar - Copenhagen, 8 January 2014
Sales distributed on regions North America, Asia and others 16%
Western Europe 61% Eastern Europe including Russia 23%
2012
6
SEB Nordic seminar - Copenhagen, 8 January 2014
Main business areas
7
SEB Nordic seminar - Copenhagen, 8 January 2014
Sales distributed on business area
Insulation segment 82%
ROCKFON
2012
GRODAN
Systems segment 18%
ROCKPANEL
LAPINUS FIBRES
8
SEB Nordic seminar - Copenhagen, 8 January 2014
Insulation Interior
Sandwich panels
Facade
Technical insulation
Flat roof
Marine & Offshore
9
SEB Nordic seminar - Copenhagen, 8 January 2014
Insulation - Product properties and market segments
RIGID PRODUCTS
FLEXIBLE PRODUCTS
Main applications: Residential, refurbishment and newbuild
Main applications: Non-residential (flat roof, facade, foundation, sandwich panels), technical insulation, OEM
Foam plastics Key market: Rigid products
Glass wool Key market: Flexible products
25 kg/m3
Stone wool Key market: Flexible and Rigid products
180 kg/m3 10
SEB Nordic seminar - Copenhagen, 8 January 2014
Global demand for energy efficient buildings grows The challenge is mainly on
existing buildings in Europe and North America and on new buildings in Asia Air-conditioning will triple before
2030 (McKinsey/Vattenfall) CO2 emissions from buildings will grow by 50+% by 2030. Mainly in North America and East Asia (IPCC) Affordable housing with low heating/cooling costs and a good sustainability profile should be a global priority
11
SEB Nordic seminar - Copenhagen, 8 January 2014
The insulation markets The EUR 25 billion global insulation market grew slightly in 2013
Western Europe 27%
Asia and other 47%
Stone and slag wool ~20%
Plastic foam ~55%
Materials
Regions Eastern Europe incl. Russia 5%
Glass wool ~25% Other ~5%
North America 21% 12
SEB Nordic seminar - Copenhagen, 8 January 2014
ROCKFON® ceilings Suspended ceilings for offices,
hospitals, educational institutions, etc. A high-end solution based on stone wool tiles and metal grids Strong performance in terms of acoustics, durability, moisture and fire properties $140 million acquisition of American ceiling grid producer CMC in 2013 Panel production in France, Netherlands, Poland and Russia. Grid plants in US, Belgium, Malaysia and China. 13
SEB Nordic seminar - Copenhagen, 8 January 2014
ROCKFON®: Markets Focus markets: Europe for soft tiles, North America and Europe for grid Market share: ± 20% Market-share in Europe Development: Global market estimated to grow from 660 to 770 million m2 coming 3 years
2013: 110 mill.m2 2016: 120 mill.m2 2013: 42 mill.m2 2016: 53 mill.m2 2013: 145 mill.m2 2016: 175 mill.m2
2013: 23 mill.m2 2016: 28 mill.m2
2013: 315 mill.m2 2016: 365 mill.m2
2013: 22 mill.m2 2016: 26 mill.m2
14
SEB Nordic seminar - Copenhagen, 8 January 2014
ROCKPANEL® boards Boards for cladding and detailing
on the exterior facade of a building Provides design and weatherprotection for new buildings as well as renovation projects Both residential and nonresidential Primarely present in Northwest Europe but expanding into neighboring regions. Production in Netherlands. New plant inaugurated October 2013 tripling capacity
15
SEB Nordic seminar - Copenhagen, 8 January 2014
ROCKPANEL®: Markets Focus markets: Benelux, Germany, Switzerland, Denmark, France and the United Kingdom Market share: ± 10% Development: European markets estimated to grow from 13.2 to 15.3 million m2 coming 3 years (16%)
New Markets East: PL & RUS 2013: 2.5 mill.m2 2016: 3.1 mill.m2
BNL, DE, CH, DK & UK 2013: 6.6 mill.m2 2016: 7.2 mill.m2
FR (80%), ES & IT 2013: 4.1 mill.m2 2016: 5.0 mill.m2
16
SEB Nordic seminar - Copenhagen, 8 January 2014
GRODAN® substrates Horticultural substrates for
precision growing in greenhouses Advantages in terms of sustainability: lower use of fertilizers and water compared to traditional growing High value added: consultancy integral part of the offering Production in Denmark,
Netherlands, Poland and Canada
17
SEB Nordic seminar - Copenhagen, 8 January 2014
GRODAN®: Markets Market: High tech greenhouse vegetable growing (tomato, cucumber, sweet-pepper) Focus markets: Western Europe, Central East Europe & Ontario Market share: Market leader in high tech horticultural industry Development: Home markets estimated to grow from 9,240 to 9,465 ha coming 3 years (2.4%) 2012: 7,080 ha 2014: 7,035 ha
2012: 940 ha 2014: 1,030 ha
2012: 1,220 ha 2014: 1,400 ha
home markets main export markets
18
SEB Nordic seminar - Copenhagen, 8 January 2014
LAPINUS® engineered fibres Fibres for brake linings, gaskets
and other high performance applications Automotive industry is the main customer group R&D and production in the
Netherlands
19
SEB Nordic seminar - Copenhagen, 8 January 2014
Longterm financial performance
20
SEB Nordic seminar - Copenhagen, 8 January 2014
Long term sales development 1984-2013e 16.000 14.000
DKK million
12.000 1,287 10.000 8.000
802
6.000 802 4.000
101
563 353
453 314
2.000 0
21
SEB Nordic seminar - Copenhagen, 8 January 2014
Long term EBITDA ratio 1984-2012 25%
Percentage
20%
15%
10%
5%
0%
22
SEB Nordic seminar - Copenhagen, 8 January 2014
Long term EBIT ratio 1984-2012
Percentage
20%
15%
Goal 11% 10%
5%
0%
23
SEB Nordic seminar - Copenhagen, 8 January 2014
Current business update
24
SEB Nordic seminar - Copenhagen, 8 January 2014
Highlights of Q3 Sales conditions in most markets continued
to improve gradually. Sales were up 2% in Q3 despite a negative currency effect The gradual recovery in the Western European insulation markets continue Good developement for the rest of the world with exception in China which is still disappointing Sales in Systems increased by 5% in Q3 less affected by currency than the insulation business. Acquisition of CMC closed EBIT in Q3 improved by 16% as the Group continues to benefit from lower raw material prices. The decrease in foundry coke prices is now expected to be over Expectations for the full year maintained on topline and raised on bottom line. Capital expenditure revised from DKK 1,500 to 1,350 million 25
SEB Nordic seminar - Copenhagen, 8 January 2014
Western Europe Sales were up 1% in Q3 on the
back of a relatively stable price development The core markets of Germany and France continue to perform well. Acquisition of German BASF closed by the end of the year Business improvements also noted in Scandinavia, Spain and Italy Market conditions in Benelux still difficult but Dutch government actions (EUR 300 million fund launched) towards energy renovation could improve markets 26
SEB Nordic seminar - Copenhagen, 8 January 2014
Eastern Europe & Russia Q3 Sales increased by 7% in local
currency, or 3% including negative currency effect Continued positive development in Russia Poland also improving on volume and sales prices Positive trends also seen in the Baltics whereas the South Eastern part of the region is still subdued
27
SEB Nordic seminar - Copenhagen, 8 January 2014
North America, Asia and rest of the World Sales increased by 3% in the quarter but
with big differences between the regions North American operations continued to develop strongly but was impacted by negative currency effects (especially CAD), and higher transport costs Key focus areas of DIY, flat roof and technical insulation all developing well Sales in South East Asia continue to perform, especially within technical insulation Disappointing sales development and increasing local competition in China. No signs of breakthrough on rules improving firesafety via non-combustible insulation .
28
SEB Nordic seminar - Copenhagen, 8 January 2014
Systems segment Sales progressed by 3% and EBIT
by 18% in the quarter Ceiling sales developing positively but still subject to relatively weak, but improving, Western European markets CMC deal closed to form a global ceiling system provider. Integration plan expected to be smooth ROCKPANEL outperforming market. New panel production in Holland inaugurated GRODAN developing nicely despite some currency headwind from Canadian sales
29
SEB Nordic seminar - Copenhagen, 8 January 2014
Expectations The Group confirms its
expectations for 2013 net sales at current exchange rates to be slightly above the level of 2012 The Group now expects a net profit for the year around DKK 800 million Capital expenditure excluding acquisitions is now expected to be around DKK 1,350 million
30
SEB Nordic seminar - Copenhagen, 8 January 2014
Questions?
31