Bekaert Investor Presentation - September 2021
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Bekaert Investor
Presentation
September 2021
Introduction to Bekaert
OVERVIEW
• The global leader in steel wire transformation and coating technologies
• Leading market position across diverse markets and geographies
1 800
• Rich 140-year history of value creation and technological innovation patents and patent
• Global presence with deep understanding of local needs rights
STRATEGY
• Optimizing value by actively managing and renewing the core business
portfolio
120
• Unlocking further growth through value-creating innovation, digital and countries with
sustainable opportunities, active portfolio management, and selective M&A in
existing and adjacent markets
customers served
CAPITAL ALLOCATION
• Well-capitalized to invest in R&D, organic growth, and accretive M&A
opportunities
27 000
• Net debt / underlying EBITDA has been reduced from 2.7x to 0.7x engaged employees
• Dividend pay-out ratio policy targeted at 40% of net income globally
Investor presentation - Bekaert 2
Global presence across diverse end markets
Combined sales, including sales of joint ventures in Brazil of ~€0.7Bn in 2020
2020 SALES BY END MARKET
23%
14% 33%
44%
19%
Tire & Automotive
Construction - Infrastructure
30%
9% Agriculture
9% Basic materials
8% Energy & utilities
6% Equipment
5% Consumer goods Bekaert production plants
Bekaert offices
Bekaert Technology Centers
Investor presentation - Bekaert 3
140+ years of innovation, growth and value creation
PIONEERING INNOVATING GROWING PERFORMING PURSUING
Established in Belgium in First patent application in Global expansion programs Performance Partnerships and
1880 as a small barbed wire June 1881 throughout history culture collaboration
manufacturer
Tire cord development 1952 Early presence in Latin Delivery on priorities better together
First acquisition abroad in America and China
In-house Engineering and € 200 million paid in dividends Operational and commercial
1920 – first investment in
R&D centers since 1960’s Largest acquisition (Pirelli) since 2018 excellence
Latin America in 1948
and merger (Bridon): 2014-
2016
Pioneering in new Preferred innovation partner Organic/inorganic growth Significant performance Actions to unlock the
technologies that address of global technology leaders plans in target markets: improvement since 2019 company’s full potential
mega trends:
1 800+ patents in portfolio Mobility | energy & utilities | Very strong balance sheet Innovation, digital, and
new mobility | urbanization | lifting & hoisting | agri | sustainability strategy
Services and adjacent Strong margin performance
connected & smart | construction & infrastructure
solutions: in all Business Units Value creation for all
renewable energy |
Lorem ipsum dolor stakeholders
sustainability | reverse Creativity beyond steel Guidance revision
globalization amet consectetur
2021-2026
adipiscing elit.
Investor presentation - Bekaert 4
Bekaert Group Executive
Leading with a shared ambition
Oswald Schmid
CEO
Stijn Vanneste Arnaud Lesschaeve Curd Vandekerckhove Yves Kerstens
Divisional CEO Divisional CEO Divisional CEO Divisional CEO
Steel Wire Solutions Rubber Reinforcement Bridon-Bekaert Ropes Group Specialty Businesses
Chief Operations Officer
Taoufiq Boussaid Kerstin Artenberg Juan Carlos Alonso
Chief Financial Officer Chief HR Officer Chief Strategy Officer
5
Technological leadership drives innovation
€ ~60 million International R&D teams in 1 800 patents
R&D annually Belgium – China – India – UK and patent rights
LEADERSHIP APPROACH STRATEGIC PARTNERSHIPS
Co-creation with customers and suppliers
Internal and external ecosystem to power business engines
• international team of technologists
• cooperation with internationally renowned research centers &
universities
• venture capital and R&D partnerships
Intellectual property protection
Commitment to increase R&D investments significantly
Investor presentation - Bekaert 6
Preferred partner
For the most challenging projects and the most innovative solutions
HAMPTON ROADS, BRIDGE & PROVENCE GRAND LARGE, SYNTHETIC DRAGLINE BHP, LTSA
TUNNEL, VIRGINIA, US FRANCE AUSTRALIA TRICO
Dramix® steel fibers are a solution to Steel and synthetic mooring lines The largest landside crane in the world 50% of global wiper systems
low-carbon concrete: 30-40% reduction in anchor windmills in the largest floating uses Bridon-Bekaert ropes that can lift carry the Bekaert wiper blade
CO2 footprint compared to traditional steel. offshore wind farms. the heaviest construction modules. solution.
ST/UT tire cord products of Bekaert save Queensferry Crossing in Scotland, the Bekaert’s lifting solutions move 80µm is the diameter of a human
1.5 billion kg of CO2 exhaust per year and world’s longest three-tower, cablestayed 1 million elevators in the world. hair – our field of play in thin
our TAWI® coating excludes the need for bridge, was built with Bekaert strands. metal fibers is 1µm to 50µm!
cobalt in rubber compounds.
Investor presentation - Bekaert 7
STRATEGY DISCUSSION Investor presentation - Bekaert 8
Growth strategy
Drive sustainable, value creating growth
Megatrends Focus on key markets Leadership positions Moving beyond the core
• New mobility • Mobility • Partner of choice • Closer to the end
• Renewable energy • Construction & infrastructure • Technology competences customer
• Urbanization • Lifting & hoisting • Global scale with • Differentiating services
• Connected and Smart • Energy & utilities Local presence and solutions
• Reverse Globalization • Agriculture • Responsive supply chain • Increase value added
profit pool
• Sustainability • Energy & utilities
• w mobility • Agriculture
• Renewable energy
• Urbanization 9
Bekaert’s strategic imperatives
We PERFORM We TRANSFORM We GROW
Execute relentlessly Continually optimize Grow organically,
to generate strong our business with innovation
operating portfolio and driving sales growth,
performance while innovate to meet our and inorganically
maintaining financial customers’ future through selective
strength needs M&A
Investor presentation - Bekaert 102021 H1 results
Strong sales – vigorous margin growth – strong balance sheet We PERFORM We TRANSFORM We GROW
Consolidated Sales uEBIT% uROCE Operating FCF Net Debt
+30% +7.2ppt +19.2ppt x2.5 € -436m
2.6 2.5 0.7
H1 2019 H1 2020 H1 2021 H1 2019 H1 2020 H1 2021 H1 2019 H1 2020 H1 2021 H1 2019 H1 2020 H1 2021 H1 2019 H1 2020 H1 2021
€ 2 306 m 12.4% 26.9% € 155 m € 519 m
uEBIT% = Underlying EBIT% / uROCE is uEBIT relative to the weighted average capital employed / Operating FCF: Cash flows from operating activities - capex (net of disposals of fixed assets) post income taxes
Investor presentation - Bekaert 11Rubber Reinforcement
Market leading position with 30% share of global tire cord market; providing innovative solutions We PERFORM We TRANSFORM We GROW
that help our customers sustainably transform the industry
In mln € % on sales THROUGH OUR
GROWTH DRIVERS LOCAL SERVICE GLOBAL FOOTPRINT
160 20%
tire rim size
140
18%
mileage driven 13 816 employees
139
120
16% innovation
sustainability
22 manufacturing plants
14%
116
100
12%
CAGR tire markets
1.7 billion in combined revenue
94
80 10%
78
60
8% RECENT DEVELOPMENTS
6% Organic sales growth of 42.8% in H1 2021 compared to H1 2020
40
due to volume rebound and positive mix
4%
20 28 uEBIT margin of 13.8% and uEBITDA margin of 18.4% in H1 2021
2% following efforts to lower the cost structure and improve the
business mix. Positive impact from inventory valuation.
- 0%
H1/19 H2/19 H1/20 H2/20 H1/21 Capex of € 12 million in H1 2021 mainly related to investments in
EMEA and Asia
uEBIT uEBIT margin uEBITDA margin
Investor presentation – Bekaert – employee numbers, manufacturing plants and combined revenue in the infographic are 2020 combined figures (including joint ventures) 12Steel Wire Solutions
Solidifying our diversified portfolio through business optimization, technology leadership and We PERFORM We TRANSFORM We GROW
strategic partnering in growth areas
In mln € % on sales THROUGH OUR
GROWTH DRIVERS LOCAL SERVICE GLOBAL FOOTPRINT
140 18%
technology
120
16% infrastructure spending
8 317 employees
100
116 14% 5G data
26 manufacturing plants
renewable energy
12%
downstream integration 1.9 billion in combined revenue
80 10% GDP growth
60 8%
RECENT DEVELOPMENTS
56 6%
40 Organic sales growth of 35.3% in H1 2021 compared to H1 2020 due
40 4% to positive price mix and strong volume growth
20 28 uEBIT margin of 13.4% and uEBITDA margin of 15.9% in H1 2021 due
23 2%
to high volumes, improved mix, cost control, pricing discipline and
positive inventory valuation
- 0%
H1/19 H2/19 H1/20 H2/20 H1/21 Capex of € 11 million in H1 2021, including investments in all regions
uEBIT uEBIT margin uEBITDA margin
Investor presentation – Bekaert – employee numbers, manufacturing plants and combined revenue in the infographic are 2020 combined figures (including joint ventures) 13Specialty Businesses
Expanding our technology leadership position in growth markets and pushing the boundaries We PERFORM We TRANSFORM We GROW
of application opportunities; 40% global market share for concrete reinforcement fibers and thin metal fibers
In mln € % on sales THROUGH OUR
GROWTH DRIVERS LOCAL SERVICE GLOBAL FOOTPRINT
45 25%
technology
40 infrastructure spending 1 395 employees
40
35
20% sustainability trends
lightweight solutions
10 manufacturing plants
30
15%
389 million in revenue
25 27
25
24
20
21 10% RECENT DEVELOPMENTS
15
Organic sales growth of 24.1% in H1 2021 compared to H1 2020
10 and above pre-pandemic levels
5%
uEBIT margin of 17.3% and uEBITDA margin of 20.4% in H1
5
2021, far above previous reporting periods
- 0% Capex of € 8 million in H1 2021 included investments in all sub-
H1/19 H2/19 H1/20 H2/20 H1/21 segments
uEBIT uEBIT margin uEBITDA margin
Investor presentation – Bekaert – employee numbers, manufacturing plants and revenue in the infographic are FY2020 figures 14Bridon-Bekaert Ropes Group
The leading innovator and provider of the best performing ropes and advanced cords globally We PERFORM We TRANSFORM We GROW
In mln € % on sales THROUGH OUR
GROWTH DRIVERS LOCAL SERVICE GLOBAL FOOTPRINT
30 20%
floating wind turbine projects
18%
oil & gas investments
2 337 employees
25
24
23
16% Mining activity
17 manufacturing plants
14% Infrastructure spending
20
12% synthetic ropes applications
424 million in revenue
15 10%
8% RECENT DEVELOPMENTS
10
10 6% Organic sales growth of 4.5% in H1 2021 compared to H1 2020
driven by higher volumes, particularly in Advanced Cords
4%
5 6 6 uEBIT margin of 9.8% and uEBITDA margin of 16.5% in H1 2021,
2% slightly below H1 2020
- 0% Closed plant in Pointe-Claire Canada, as all North American ropes
H1/19 H2/19 H1/20 H2/20 H1/21 activities have been consolidated in the US
uEBIT uEBIT margin uEBITDA margin Capex of € 10.5 million in PP&E in H1 2021, mainly in the UK, US
and in Advanced Cords Belgium
Investor presentation – Bekaert – employee numbers, manufacturing plants and revenue in the infographic are FY2020 figures 15Key elements of our business strategy
We PERFORM We TRANSFORM We GROW
PORTFOLIO ORGANIZATIONAL
MANAGEMENT DIGITAL INNOVATION SUSTAINABILITY
CAPABILITIES
• Invest for growth • Leadership • Operations • Continuous • Clear commitment to:
improvement
• Scale-up • Performance • Customer − Environment
management • Transform the core
• Turnaround or divest • Process − Social
• Capability & • Grow beyond the
competence • Products core − Governance
Investor presentation - Bekaert 16We are actively managing our business portfolio
We PERFORM We TRANSFORM We GROW
ACTIVE PORTFOLIO MANAGEMENT ACTION FOCUS BUSINESS MIX
Strategic Invest for Exit loss-making businesses without turnaround Sales EBITDA
potential
Scale-Up Growth
diamond sawing wire
commodity activities of SWS
Turn around SWS and BBRG through profit
Market Attractiveness
restoration and footprint adjustments
Cost savings and other structural improvements
Grow small-sized businesses with high potential
fiber technologies
synthetic ropes
Invest in core businesses with strong positions
and further growth potential
tire reinforcement (Vietnam, Russia, Brazil)
Turn-around or exit building products (Czech Republic, India, CCL
partnership)
SWS and BBRG growth markets (wind energy,
Bekaert’s Ability to Win utilities)
advanced cords (elevator, other industrial) 2020 2025E 2020 2025E
Investor presentation - Bekaert 17Thoughtful approach to accretive growth
We PERFORM We TRANSFORM We GROW
Develop innovative services Move into services
that address mega trends.
Go downstream Move beyond the core and closer to the end customer
by providing differentiated services and solutions.
Develop adjacencies
v Create opportunities in adjacent markets
through strategic partnerships with recognized
Active portfolio management to improve the market leaders.
business mix and to meet the needs of our
customers. Reinforce the core
Investor presentation - Bekaert 18Our business focus is aligned with mega trends
We PERFORM We TRANSFORM We GROW
NEW MOBILITY
Light-weight, smart and green materials for tires
URBANIZATION
Advanced cords for vertical city requirements; smart glazing solutions
with thin fiber technologies; low-carbon concrete reinforcement
RENEWABLE ENERGY
Light-weight mooring for offshore floating wind turbines; new fibers
for hydrogen electrolysis
CONNECTED & SMART
5G & data transmission technology for fiber optic
networks
REVERSE GLOBALIZATION
Agile and digital supply chain; regional footprint
Investor presentation - Bekaert 19Creativity is at the center of our strategy
DIGITALIZATION
INNOVATION Beyond digital working to
Data intelligence platforms
Beyond products to
New solutions & services
Beyond existing
areas of expertise to
Emerging subsegments
CREATIVITY
BEYOND STEEL
to shape the way we live and move CULTURE
Beyond us to
A closer collaboration
with innovative partners,
together in one team
Beyond our
engineering mindset to
SUSTAINABILITY A new way of thinking:
Beyond better performance to (end) customer centric
More sustainable outcomes
Investor presentation - Bekaert 20Investing in innovative solutions
We PERFORM We TRANSFORM We GROW
STRONG INVESTMENTS REBALANCING OUR PIPELINE
TO INNOVATE WITH THREE BUSINESS ENGINES
Focused and prioritized
€60M Cost and process improvements
World-class operations
E0 Efficient - accelerate through digital and
smart and remote serviced processes
T&I Investments
Product and solution development Driven by customer needs
+600 From incremental innovation
towards offering elevation
E1 More ambitious platforms
Stronger portfolio governance
Experts Incubation in ring-fenced
Anticipation of major disruptions
Develop smart products and entrepreneurial teams
E2
+1 800 solutions
Solutions for new growing markets
External ecosystem collaboration and
partnerships
Patents
Investments
+50%
Increased investment
2020 E0 E1 E2
+15%
Sales from new solutions
over next 5 years by 2025
2025E E0 E1 E2
Investor presentation - Bekaert 21Digitalization is employed across the organization
We PERFORM We TRANSFORM We GROW
CUSTOMER PRODUCT PROCESS OPERATION
Customer Data-driven Smart Accelerated Enterprise Intelligent End-to-End
Experience pricing solutions R&D 2.0 production Supply chain
Engagement Advanced Data driven Digital twins Intelligent Intelligent E-buying
insights business models automation processes
Feedback loops Advanced
AI-enabled Smart wires testing and E2E data Digital ways of Digital S&OP
Digital marketing forecasting & sensoring modelling transparency working and forecasting
Investor presentation - Bekaert 22Focused on delivering sustainable solutions
We PERFORM We TRANSFORM We GROW
CUSTOMERS
COMPETITIVE ADVANTAGE
• Increasing requirements on suppliers
• First mover advantage
• Sustainable solutions outgrow others
• Significant cost savings
• End-industry disruptions
• Opportunity to differentiate
PEOPLE & COMMUNITIES
INVESTORS & REGULATORS
• Increase top talent attraction and
engagement • ESG target investing
• Positive impact on our • Lower financing costs
local communities • Expectation for Science-based
targets and towards net-zero policies
Investor presentation - Bekaert 23Committed to ambitious sustainability goals
2030 goals vs. 2019 baseline We PERFORM We TRANSFORM We GROW
ENVIRONMENTAL SOCIAL GOVERNANCE
Towards Carbon Neutrality Working conditions Highest Ethical Standards
Reduce GHG emissions in line Ethics and Code of Conduct
-45% with Science Based Targets 0 Strive for zero accidents
Strict compliance management
Aim for Carbon Net Zero by
2050
Sustainable Solutions Diversity & Inclusion Fair sourcing + transparency
of our sales to be from
~65% sustainable solutions 40% Female managers/
white collars 100% of strategic suppliers
EcoVadis listed
Positive working environment for all our of spend with suppliers who
employees 95% sign off Code of Conduct
Water Community relations Best in class governance & reporting
relative freshwater intake in Actively engage with communities on Transparent and integrated reporting
-15% stressed regions priority sustainability themes
Investor presentation - Bekaert 24Innovation in action
We PERFORM We TRANSFORM We GROW
DIGITALIZATION NEW MOBILTY CLEAN ENERGY
Together with VisionTek, BBRG developed the first Bekaert invested in Cargo Sous Terrain and is Bekaert participates in a consortium to develop
mobile 3D rope measuring and visioning technology advisor on the Board the next generation electrolysers for green
equipment to monitor, control, predict and optimize Hydrogen production
the lifecycle of ropes
Investor presentation - Bekaert 25Enabling new, sustainable solutions
We PERFORM We TRANSFORM We GROW
ENERGY AND UTILITIES
Beyond current markets and
solutions
Digital Twin Synthetic & hybrid Strategic Bezinox®
models solutions Partnerships cable armoring
Enabling the
future
Investor presentation - Bekaert 26Reducing environmental impact
We PERFORM We TRANSFORM We GROW
Dramix® solutions reducing input intensity SigmaSlabTM, a new Dramix® solution
co-developed with post-tensioning leader CCL
Heavy, labor-intensive More efficient and easy to use
traditional reinforcement steel fiber reinforced concrete
Construction Reinforcement Typical transformation
Low Carbon concrete (SigmaSlabTM example)
Reducing • 70% less steel reinforcement
• 20% less concrete
material • 30-40% reduction in CO2 footprint
intensity
Investor presentation - Bekaert 27Better together
With our customers, employees, shareholders and communities
We make our We are truly We commit to We care for
customers succeed better together high performance the world around us
Customer centricity is at the The true strength of Bekaert lies Our commitment to high We develop solutions that
heart of everything we do. at the heart of every employee’s performance benefits all our contribute to a clean environment
passion to go the extra mile for stakeholders, including our and raise our efforts to become a
Our aim is to be our customer’s
our customers. shareholders. truly sustainable business.
partner of choice by offering
differentiated solutions and Our values are ingrained in our We want to create value for our We support initiatives that help
services, and by driving culture and connect us all as stakeholders by delivering on improve the social conditions in the
sustainable innovations. One Bekaert team. our high ambitions. communities where we are active.
Investor presentation - Bekaert 28Financial Outlook Investor presentation - Bekaert 29
Sales growth driven by strategic focus STRATEGIC FOCUS consolidated sales in billions of euro • market positioning • mix improvements • pricing discipline • customer success • operational excellence Investor presentation - Bekaert 30
Increased profit from sales growth and stronger business model SALES GROWTH underlying EBIT in millions of euro and as a % on sales • in the right markets • with higher-end solutions • with successful customers • at the right price BUSINESS MODEL • Improved footprint • structural savings • high degree of resilience • capital allocation strategy Investor presentation - Bekaert 31
Cash flow generation is at the center of our strategy
WORKING CAPITAL CAPITAL ALLOCATION
• Decreased by 40% in 2 years (YE 2020 vs YE 2018) • ROCE improved by +50% in 2 years (FY 2020 vs FY 2018)
• Average working capital on sales decreased • H1 2021: very high ROCE of 27%
from 20% (FY 2018) to 13% (H1 2021)
• Objective is to reach a ROCE greater than 20%
• Objective is to maintain a level of 15-16% through the cycle
Working capital in millions of euro and as a % on sales % underlying ROCE
mid-term 2018 2019 2020 through the cycle
Investor presentation - Bekaert 32Solid cash generation from higher profitability
SOLID CASH GENERATION OCF in millions of euro
• Objectives:
− step up OCF (1)
− FCF yield (2) of ~100%
• Funding opportunities to grow:
− organic and inorganic
− investments in innovation,
sustainability, digital
− dividend
(1) OCF = uEBITDA + delta working capital – capex. Pre-income taxes (2) FCF yield = FCF / net result
Investor presentation - Bekaert 33Continuous focus on maintaining conservative balance sheet
net debt on
uEBITDA
Investor presentation - Bekaert 34Liquidity position is strong and debt maturities are balanced Investor presentation - Bekaert 35
Focused on shareholder returns through dividend policy
250 80%
200
60%
150
Pay-out ratio
45%
In millions of €
40% 40%
100
20%
50
0 0%
2011 2013 2014 2015 2016 2017 2018 2019 2020
Result Attributable to the Group Dividend pay-out Pay-out policy over the years Average pay-out % over the years
At the Annual General Meeting of Shareholders in May 2021, a gross dividend of € 1.00 was
approved, in line with the company’s pay-out policy.
Investor presentation - Bekaert 36Value creation in our financial projections 2021-2026
Consolidated uEBIT FCF Net debt
sales margin yield leverage
Restated mid-term targets 3%+ CAGR 9%-11% ~100% < 1.5
(2022-2026) organic through the cycle FCF/net result net debt/uEBITDA
Restated short-term € ~4.6 bln 10%+ < 1.0
guidance (2021)
Changes versus previous guidance:
Mid-term underlying EBIT margin target: from 8-10% to 9-11%
FY 2021 outlook: consolidated sales from ≥ € 4.4 billion to € ~4.6 billion – underlying EBIT margin from ≥ 8% (≥ 80bps above FY 2020 level of 7.2%) to 10% or better.
37Conclusion Investor presentation - Bekaert 38
Why invest in Bekaert
PERFORMANCE-DRIVEN MARKET LEADER
• Delivering on priorities and focused on higher value opportunities
• Global scale, partnerships and intellectual property to protect and enhance position in key end
markets
FOCUSED EXECUTION OF STRATEGIC PLAN
• Strong track record of consistently improving business portfolio
• Capabilities and ability to execute on investments in innovation, digitalization and sustainability
DELIVERING GROWTH THROUGH INNOVATION
• Clear capital allocation strategy to maximize return on investment
• Unlocking growth potential through R&D and focus on creative new applications
• Focused on creating value for all stakeholders, including our shareholders
Investor presentation - Bekaert 39Save the date
Third quarter trading update 2021 19 November 2021
Full year results 2021 25 February 2022
Integrated report 2021 22 March 2022
Capital Markets Day - See the content or watch the replay of the of 28 May 2021 on Our performance
Bekaert Investment Case – IR presentations – Let’s Meet
Recent publications: H1 2021 Results - Annual Report - Sustainability Report
Investor presentation - Bekaert 40Contact
Investor Relations:
Katelijn Bohez Dries Van Hamme
katelijn.bohez@bekaert.com dries.vanhamme@bekaert.com
Documentation:
Christine Clarysse
Christine.clarysse@bekaert.com
Shareholders, investors and other interested parties wishing to receive the Group's annual report, the shareholders guide, the annual
accounts of NV Bekaert SA or other information published by the Group may contact the Investor Relations department at any time.
This presentation may contain forward-looking statements. Such statements reflect the current views of management regarding future events, and involve known and unknown risks,
uncertainties and other factors that may cause actual results to be materially different from any future results, performance or achievements expressed or implied by such forward-looking
statements. Bekaert is providing the information in this brochure as of its date and does not undertake any obligation to update any forward-looking statements contained in this brochure in
light of new information, future events or otherwise. Bekaert disclaims any liability for statements made or published by third parties and does not undertake any obligation to correct inaccurate
data, information, conclusions or opinions published by third parties in relation to this or any other publication issued by Bekaert.
Investor presentation - Bekaert 41H1 2021 Financial Supplement Investor presentation - Bekaert 42
Our business context in Q2 2021
Macro-economic developments
• Significant surge of demand
• Global supply chain interruptions
• Commodity price increases
• Reverse globalization trend
• Continued uncertainties about Covid-19
Investor presentation - Bekaert 43Our business context in Q2 2021
Demand developments for Bekaert
• Very strong tire markets in EMEA and India and pick-up in North America
• Tailing off demand in China at the end of Q2
• Demand from automotive OEM not yet to pre-Covid levels due to global chip shortage
• Strong demand from construction markets in Latin America throughout H1
• Progressive demand improvement in the rest of the world and solid demand for elevator solutions
• Stimulus programs and de-globalization trends have been beneficial
• Strong demand in energy & utility markets
• Positive evolutions for flexible pipe armoring and offshore wind applications
• Robust demand for overhead power cable solutions
• Solid demand from agriculture, fishing & marine, and mining markets
• Increased demand for hose reinforcement and filtration solutions
• Growing interest for digital solutions
Investor presentation - Bekaert 44Focus and priorities in H1 2021
Actions geared towards three main areas Further development and deployment of
our strategic transformation
o Capture the growth from volume recovery to pre-Covid-19 levels Strategy validation and start of implementation:
̵ global demand rebound
̵ customer-centric and go-to-market strategy & focus
Innovation
̵ supply chain excellence: delivery continuity
o Structural improvement of the overall Bekaert performance
̵ Product and business mix improvements
̵ Pricing discipline aligned with raw material price trends
̵ Acceleration of commercial and operational excellence
̵ Continued effective working capital and cost control
o Seizing the opportunities from temporary tailwinds
̵ Positive inventory valuation impact from raw material prices
̵ Excluding this impact, uEBIT margin reached ~10% Sustainability Digital
Investor presentation - Bekaert 452021 H1 results
Strong sales – vigorous margin growth – strong balance sheet
Consolidated Sales uEBIT% uROCE Operating FCF Net Debt
+30% +7.2ppt +19.2ppt x2.5 € -436m
2.6 2.5 0.7
H1 2019 H1 2020 H1 2021 H1 2019 H1 2020 H1 2021 H1 2019 H1 2020 H1 2021 H1 2019 H1 2020 H1 2021 H1 2019 H1 2020 H1 2021
€ 2 306 m 12.4% 26.9% € 155 m € 519 m
uEBIT% = Underlying EBIT% / uROCE is uEBIT relative to the weighted average capital employed / Operating FCF: Cash flows from operating activities - capex (net of disposals of fixed assets) post income taxes
Investor presentation - Bekaert 462021 H1 Sales
In millions of €
Consolidated sales H1 2020 H1 2021 Variance Organic FX
Rubber Reinforcement 709 991 +40% +43% -3%
Steel Wire Solutions 639 849 +33% +35% -3%
Specialty Businesses 185 227 +23% +24% -1%
BBRG 229 236 +3% +5% -1%
Group 9 3 - - -
Total consolidated sales 1 770 2 306 +30% +33% -2%
Total combined sales 2 065 2 782 +35% +39% -5%
Consolidated sales Combined sales
Rubber Reinforcement 43% Rubber Reinforcement 39%
Steel Wire Solutions 37% Steel Wire Solutions 45%
Specialty Businesses 10% Specialty Businesses 8%
BBRG 10% BBRG 8%
Combined sales are sales of consolidated companies plus 100% of sales of joint ventures and associates after intercompany elimination
Investor presentation - Bekaert 47Consolidated income statement: key figures
In millions of € Underlying Reported
H1 2020 H1 2021 H1 2020 H1 2021
Sales 1 770 2 306 1 770 2 306
Cost of sales (1 518) (1 833) (1 521) (1 847)
Gross profit 252 473 249 459
Selling expenses (81) (88) (81) (87)
Administrative expenses (59) (78) (60) (76)
R&D expenses (25) (29) (26) (29)
Other operating revenue and expenses 4 9 4 21
EBIT 92 285 87 288
Overheads increase in absolute numbers but decrease as a % on sales: -80bps to 8.5%
Investor presentation - Bekaert 48EBIT-Underlying bridge: Consolidated view
In millions of €
300
16
280
(13)
260
61
240
220
200
65
180
285
160
140
120 65
100
80 92 0
60
EBIT-Underlying FX effects Inventory Volume Price-Mix Structural cost Other EBIT-Underlying
H1 2020 Valuation improvement H1 2021
actions
Investor presentation - Bekaert 49Rubber Reinforcement
SALES uEBIT H1|H2 MARGINS Joint Venture Brazil
€ 81 mln sales
18.3% 18.4% +58%
15.3%
14.4%
11.1%
13.8% CAPEX
991 12.6%
139 € 12 mln
709 9.1%
8.2%
28 3.9%
uROCE
H1|20 H1|21 H1|20 H1|21 H1|19 H2|19 H1|20 H2|20 H1|21
uEBIT% uEBITDA% 24.6%
Investor presentation - Bekaert 50Steel Wire Solutions
SALES uEBIT H1|H2 MARGINS Joint Venture Brazil
€ 397 mln sales
+57%
15.9%
11.6%
10.2% 13.4%
849 CAPEX
639 7.1% 7.1% € 11 mln
116
8.0%
6.0%
40
3.5% 3.2%
uROCE
H1|20 H1|21 H1|20 H1|21 H1|19 H2|19 H1|20 H2|20 H1|21
uEBIT% uEBITDA% 43.2%
Investor presentation - Bekaert 51Specialty Businesses
SALES uEBIT H1|H2 MARGINS
CAPEX
20.4%
€ 8 mln
16.6%
15.7% 15.8%
14.6%
227
17.3%
185 40 12.9%
12.0% 12.4%
10.1%
24
uROCE
H1|20 H1|21 H1|20 H1|21 H1|19 H2|19 H1|20 H2|20 H1|21 35.4%
uEBIT% uEBITDA%
Investor presentation - Bekaert 52Bridon-Bekaert Ropes Group
SALES uEBIT H1|H2 MARGINS
CAPEX
17.2%
16.5% € 10 mln
12.7%
229 236 10.0%
8.0%
24 23
9.8%
10.3%
5.1% uROCE
2.6% 2.3%
H1|20 H1|21 H1|20 H1|21 H1|19 H2|19 H1|20 H2|20 H1|21 10.9%
uEBIT% uEBITDA%
Investor presentation - Bekaert 53Consolidated income statement: key figures
ETR1
In millions of € H1 2020 H1 2021
53%
EBIT 87 288
26%
Interest income / expense (28) (23)
H1|20 H1|21
Other financial income and expenses (15) 4
Share in JVs2
Result before taxes 44 268
34
Income taxes (23) (71)
13
Result after taxes (consolidated companies) 21 197
Share in the results of joint ventures and H1|20 H1|21
13 34
associates
Net result3
Result for the period 34 231
208
Attributable to non-controlling interests 23
33
Attributable to equity holders of Bekaert 33 208 H1|20 H1|21
(1) Effective tax rate / (2) Share in the results of JVs / (3) Result of the period attributable to equity holders of Bekaert
Investor presentation - Bekaert 54Working capital: key figures
In millions of € WORKING CAPITAL H1|20 YE|20 H1|21
1000 896
757 758 720
683 667
626 660
535
500
13%
0
Working capital
on sales
-500
-663
-809
-1000
-987
-1500
inventories accounts accounts total
receivable payable working capital
Investor presentation - Bekaert 55Key figures per share
H1 2020 H1 2021
Share price 17.45 37.58
Number of existing shares 60 408 441 60 414 841
Book value 22.61 28.23
x6
Earnings per share (EPS) 0.59 3.66 EPS
Weighted average number of shares 56 543 997 56 813 437
Investor presentation - Bekaert 56Business units with multiple growth drivers
Consolidated sales by business unit (FY 2020)
Rubber Reinforcement (RR) Steel Wire Solutions (SWS) Specialty Businesses (SB) Bridon-Bekaert Ropes
Group (BBRG)
Tire cord, bead wire, hose Steel wire products and Building products, fiber Ropes and advanced
reinforcement wire and solutions serving industrial, technologies, combustion cords businesses
conveyor belt agricultural, consumer and technologies
reinforcement construction markets
5% 6% 2% 11%
7% 9%
28% 29%
8% 14%
10%
6%
€1.6Bn €1.3Bn €0.4Bn €0.4Bn
14%
75% 18%
20% 28%
95% 15%
6%
31%
11%
14%
16%
Construction Agriculture Consumer Goods Tire & Automotive Energy & Utilities Basic Materials Equipment Other
Investor presentation - Bekaert 57You can also read
