Investors Presentation - December 2021 Dr Stephan Meeder, CEO/CFO Heike Baumbach, Head of Investor Relations - CropEnergies AG
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Investors Presentation
December 2021
Dr Stephan Meeder, CEO/CFO
Heike Baumbach, Head of Investor Relations
EU: European Green Deal European Parliament gave green light to first-ever EU climate law on 24 June 2021 • Interim target: Reduction of GHG emissions of at least 55% by 2030 (on 1990 levels) • Climate-neutrality by 2050 “Fit for 55” legislative package • Proposals to make the EU's climate, energy, land use, transport and taxation policies fit for reducing net greenhouse gas emissions by at least 55% by 2030, compared to 1990 levels Revision of various regulations and directives planned, i.e. • Emissions Trading System (ETS) • Effort Sharing Regulation (ESR) • Revision of the Energy Tax Directive (ETD) • Amendment to the Renewable Energy Directive (RED II) December 2021 2
Renewable Ethanol As fuel • Produced from local, renewable raw materials • High-quality fuel for petrol engines • Ensures that fossil carbons remain in the ground permanently and do not continue to drive climate change • Less greenhouse gas emissions, nitrogen oxides & particulate matter emissions compared to fossil fuels • CropEnergies ethanol reduces CO2 emissions by an average of more than 70% compared to fossil fuel. December 2021 3
Ethanol
>70% less GHG emissions compared to fossil fuels*
• The GHG values of all elements in the value-added chain are added up
• The emissions from ethanol when used in combustion engines is zero
• European ethanol reduces annual GHG emissions by >10 Mt**
Cultivation Transport Ethanol Ethanol CO2
Grain Grain Production Transport Liquefaction
*83,8 gCO2eq/MJ **Own calculations
December 2021 4
Range of products
Renewable Ethanol
As an additive to petrol to improve the
greenhouse gas balance
As neutral alcohol for beverages and
foods
As neutral alcohol for the processing
industry: cosmetics, pharmaceuticals,
disinfectant and technical applications
As a raw material for the chemical
High-quality, renewable industry
ethanol (alcohol)
December 2021 5
Range of products
Food and animal feed
ProtiGrain® & Ensus- CDS – ProtiWanze® Gluten Liquefied biogenic
DDGS liquid protein animal Protein product for the CO2
dried high-quality feed food and animal feed for food and industrial
animal feed, in form of industry applications
powder or pellets
December 2021 6
The ethanol markets
EU & UK production
• World production • EU & UK production
• 2021e: 123 million m3 (+4%) • 2021e: 7.6 million m3 (+2%)
o Fuel applications: 104 million m³ (+5%) o Fuel applications: 5.3 million m³ (+5%)
• 2022e: 128 million m3 (+4%) • 2022e: 8.1 million m3 (+6%)
o Fuel applications: 107 million m³ (+3%) o Fuel applications: 5.7 million m³ (+9%)
World production of ethanol [M m3] EU & UK production of ethanol [M m3]
150 9
100 6
Source: FO Licht (2021)
Source: FO Licht (2021)
50 3
2017 2018 2019 2020 2021e 2022e 2017 2018 2019 2020 2021e 2022e
USA Brasil EU & UK other fuel non-fuel
December 2021 7
Market development (I)
Volumes
EU27 & UK: ethanol sales [1,000 m3]
8,666 9,059
Ethanol market in the EU27 & UK in 2021 (in million m³) ,
9.200 8,494 8,371
965
982 955 965
Source: IHS Markit (2021)
• Consumption: 8.7 +4% (5.8 fuel | 2.9 non-fuel) 1,618 1,950 1,890 1,860
• Production: 7.6 +2% (5.3 fuel | 2.3 non-fuel) 4.600
,
• Outlook: Strong increase in fuel ethanol demand expected in 2022 5,894 5,466 5,811 6,234
0
2019 2020 2021 2022
Fuel Industrial Potable
Premium E10 continues to be on the rise in Europe
Source: ePURE, BAFA (2021)
E10 shares in selected countries
• E10 already established as #1 petrol in many European countries 100%
100%
100%
98%
• Successful launch in Sweden and UK in August and September led to
95%
95%
95%
90%
80%
72%
increased demand
70%
50%
16%
47%
45%
0%
December 2021 8
Market development (II)
Ethanol prices and feedstock market
European ethanol prices [€/m3]
1400
High volatility in ethanol prices*
• Increased mobility in many countries
850
• Ethanol prices reach all-time high in November 2021
• Sudden price drop due to fear of omicron variant FY 19/20 FY 20/21 FY 21/22
300
Feedstock market 2021/22
Euronext Paris Wheat [€/t]
• EU grain harvest exceeds consumption, record global grain 325
harvest expected
• High price level despite promising harvest estimations meets high
225
demand
FY 19/20 FY 20/21 FY 21/22
125
* T2 FOB Rdam
December 2021 9
Market development (III)
Energy markets
Natural Gas FR [€/MWh]
150
FY 19/20 FY 20/21 FY 21/22
Gas prices on a very high level in Europe
• Low storage levels due to long and cold winter 2020/21
75
• LNG exports from the US rather heading to Japan/Korea
• Announcement to increase gas supplies to the EU from 8 November 2021
onwards led to instant price drop 0
• New price increase after Bundesnetzagentur temporarily suspends
certification of Nord Stream 2 Natural Gas UK [€/MWh]
150
• Start of supply by new North Stream 2 pipeline remains unclear FY 19/20 FY 20/21 FY 21/22
• Price development in winter season will be weather-driven
75
0
December 2021 10State of EU energy and transport policies Before Fit for 55 December 2021 11
Renewable Energy Directive-II
The “toolbox“
Arable crops Annex IX-A Annex IX-B Electricity
• 2020 level, max. 7% • Min. 0.2% in 2022 • Max. 1.7%, but still • Important component
• Local, sustainable • Min. 1.0 % in 2025 x2 versus today in the future
• Proteins • At least 3.5% in 2030 • UCO imports: 10x • But: discretionary
within last 10 years multiplier (x4) does not
• Commitment to 1G • Strong market save a single gram of
as reliable basis for potential • Compatibility with
CO2
low-emission law on waste needs
• Very capital intense to be ensured • Extension only
transport sector
necessary reasonable if
• Investment security additional green
and investment electricity will be
incentives decisive produced
December 2021 12State of EU energy and transport policies After Fit for 55 (proposal) December 2021 13
Vision and mission OUR VISION Our vision is a climate friendly world in which renewable resources are key to ensuring the welfare of today‘s and future generations. OUR MISSION Our mission is to be the most trusted partner for our customers delivering sustainable products made out of biomass. Our new appearance: December 2021 14
CropEnergies
Innovation from Biomass
For our future: Sustainability and climate neutrality
• In its traditional core business of mobility - with sustainable and
climate-friendly fuels
• In a completely new business area based on ethanol derivatives
as an alternative to fossil raw materials
• With biogenic CO2 as the raw material of the future and as capital
for the company's further development
• To serve a clear growth market with protein products for the food
and animal feed industry and to deepen the value chain
Super Eco 20
• Various motor sports sponsorings
• E20 project in cooperation with airport Stuttgart
December 2021 15Outlook 2021/22
As of 28 October 2021
• Significant increase in ethanol sales prices
• At the same time higher prices for raw materials and energy
• Revenues between € 1,020 to €1,070 (previously expected: € 970 to € 1,010, previous year: € 833) million
• EBITDA in a range of € 135 to € 170 (previously expected: € 105 to € 135, previous year: € 148) million
• Operating profit between € 95 to € 125 (previously expected: € 65 to € 90, previous year: € 107) million
December 2021 16Q2 2021/22
Overview 2nd quarter 2021/22 • Ethanol production 285 (255) ,000 m³ + 13% • Revenues € 249.2 (228.5) million + 9% • EBITDA € 33.7 (52.2) million - € 18.5 million • Operating profit € 23.3 (42.6) million - € 19.3 million • Net earnings € 14.7 (31.5) million - € 16.8 million • Net financial assets (vs. 28/02/2021) € 159.1 (154.6) million + € 4 million Note: Figures in parentheses relate to the corresponding prior-year period December 2021 18
Operating profit
Revenues / Production
[M€ / 1,000 m3]
400
(in € million) Q2 2021/22 Q2 2020/21 Δ
285
300 272 251
Revenues 249.2 228.5 + 9% 255 235
Overall performance 258.6 221.7 + 17% 249
200 229 226 214
208
Cost of materials* -201.5 -145.9 - 38%
100
Spread (gross) 57.2 75.7 - 25%
in % of overall performance 22.1% 34.2% - 0
Q2 Q3 Q4 Q1 Q2
Further operating expenses/income* -23.5 -23.5 - 0% 20/21 20/21 20/21 21/22 21/22
EBITDA* 33.7 52.2 - 36% Operating profit [M€]
75
Depreciation* -10.4 -9.7 - 7%
Operating profit 23.3 42.6 - 45%
50 43
Margin 9.3% 18.6% -
*without restructuring costs and special items 29 28
23
25
• Highest quarterly revenues in CropEnergies’ history 15
• Significantly higher raw material and energy costs 0
Q2 Q3 Q4 Q1 Q2
20/21 20/21 20/21 21/22 21/22
December 2021 19Overview 1st half 2021/22 • Ethanol production 520 (463) ,000 m³ + 12% • Revenues € 463.2 (399.2) million + 16% • EBITDA € 59.1 (70.4) million - € 11 million • Operating profit € 38.4 (50.7) million - € 12 million • Net earnings € 24.9 (39.4) million - € 15 million • Net financial assets (vs. 28/02/2021) € 159.1 (154.6) million + € 4 million Note: Figures in parentheses relate to the corresponding prior-year period December 2021 20
Net earnings
Net earnings for the period [M€]
75
(in € million) 6 M 2021/22 6 M 2020/21 Δ
Operating profit 38.4 50.7 - 24% 50 45
39
Restructuring costs / special items 0.0 0.9 - 100%
25
At-equity result 0.0 0.2 - 87% 25
Income from operations 38.4 51.8 - 26%
0
Financial result -1.3 1.5 - 1st half 2nd half 1st half
20/21 20/21 21/22
Earnings before income taxes 37.1 53.3 - 30%
Taxes on income -12.2 -13.9 + 12%
Net earnings for the period 24.9 39.4 - 37%
• Unrealised currency effects included in financial result
• Tax rate increases to 33 (26)%
• EPS reduced at € 0.28 (0.45)
December 2021 21Cash flow
Cash flow (+) / Investments* (-)
[M€]
75 *in PPE
(in € million) 6 M 2021/22 6 M 2020/21 Δ
55
47
Cash flow 47.0 54.9 - 7.9 50
Change in net working capital -0.6 -27.9 + 27.3
25
Net cash flow from operating activities 46.4 27.0 + 19.4
Investments in property, plant et al. -9.8 -13.5 + 4.4 0
Cash received on divestments 0.5 0.0 + 0.5
-14 -10
Payments into financial receivables 5.2 7.2 - 2.0 -25
Payments into current financial investments 0.0 0.0 + 0.0 1st half 1st half
20/21 21/22
Cash flow from investing activities -4.1 -6.3 + 2.2 Net financial asset [M€]
250
Cash flow from financing activities -33.0 -27.5 - 5.5
Changes in exchange rates / consolidation basis 0.0 -0.1 + 0.1 200
155 159
Change in cash and cash equivalents 9.3 -6.9 + 16.2 150
100 92
31.08.2021 31.08.2020 Δ
50
Net financial assets 159.1 92.4 + 66.7
0
• Significant increase in net financial assets 31/08/20 28/02/21 31/08/21
December 2021 22Appendix
Climate-friendly liquid fuels will be essential
Development of car registrations and vehicles in use
New car registrations EU27 New car registrations DE Vehicles in use DE
2% 2% 2% 0.4% 0.4% 0.5%
100% 100% 50 Mio. 1%
5% 1% 1%
2% 8% 2% 7% 12%
0.3% 0.6%
0.2%
32% 28% 21% 32% 40 Mio. 31%
75% 28% 21% 32% 32%
75%
0.2% 0.6%
1% 9% 1%
5% 0.1%
6% 5% 7% 12% 30 Mio. 0.6% 1% 1.5%
12% 19% 11%
50% 50%
17%
20 Mio.
58% 59% 66% 66% 65%
25% 47% 25%
41% 47%
38% 10 Mio.
0% 0% Mio.
2019 2020 Jan-Sep 2021 2019 2020 Jan-Sep 2021 01.01.2019 01.01.2020 01.01.2021
Gasoline HEV Gasoline HEV Gasoline HEV
PHEV Diesel PHEV Diesel PHEV Diesel
BEV APV other than electric BEV APV other than electric BEV APV other than electric
Source: ACEA (2021) Source: KBA (2021) Source: KBA (2021)
December 2021 24Gross electricity generation in the EU27 in
Total: 2,760 TWh
Gross electricity generation in the Development of electricity generation in the
EU27 in 2020 EU27 [TWh]
Total: 2,760 TWh 1200
38%
fossil
(others) 1000
4% 33%
800 25%
solid fossil
13% 30%
600
renewables
natural gas 38% 16% 20%
20% 400
12% 13%
200
9%
nuclear 4%
25% 0
renewables nuclear natural gas
Source: Agora (2021) solid fuels fossil (others)
Source: Agora (2021)
December 2021 25Renewable fuels in transport
... continuing to be indispensable in 2030 and beyond
Europeans still drive (buys) petrol cars
(EU new car registrations by fuel type H1 2021)
2%
7% Crop-based
biofuels 58%
Other biofuels
Gasoline
22% HEV 4.5%
42%
PHEV Fossil Renewables
Diesel 93.7% 6.3%
BEV
Others Annex IX-A 7.2%
8% Annex IX-B RE road 0.5%
19.9%
19%
RE Rail 8.3%
Source: ACEA (2021) RE Others 1.6%
• Roughly two thirds of the newly registered cars run entirely or partly on gasoline
• Renewable fuels: immediately available – without new infrastructure and vehicles, but more residues and wastes
• E-mobility: growing – but does not reduce CO2 footprint of existing fleet, high costs for infrastructure & new car fleet
• Synfuels: promising – but not yet available at scale
December 2021 26Climate protection for Germany
• National implementation of RED-II
DE: GHG reduction quota
• Overall GHG quota from currently 6% to 25% in 2030 2020-2030
25%
o Penalty for non-compliance increases to € 600/t CO2äq from 2022 on 25%
o GHG quota will be further increased depending on the growth in e-mobility
20%
o Recognition of Upstream Emission Reductions will cease after 2026 17.5%
o Introduction of special blending quota for synthetic jet fuels from 2026 on 15%
12%
• Phase-out of high ILUC fuels (palm oil) from 2023 on* 9.25%
10% 8%
• Biofuels from arable crops: max. 4.4% (2018: 3.2%)* 6%
7%
• Advanced biofuels from residues min. 2.6% in 2030* 5%
• Multiple counting schemes for electromobility, advanced/synthetic fuels* 0%
* Further regulations to be laid down at ordinance level
December 2021 27More climate protection for Europe
EU taxonomy regulation
• Classification system to promote sustainable investments
• Application on EU environmental targets
• From 2022: climate change mitigation and adaptation on climate change
• From 2023: Protection of water und maritime resources, transition to circular
economy, no/less environmental pollution and protection of
biodiversity/ecosystems
• Evaluation
• Positive: basic idea and recognition of the contribution of biofuels to climate
protection and the adaptation to climate change
• But: exclusion of crop-based biofuels for climate change mitigation measures is
arbitrary and in contradiction to the Renewable Energy Directive
December 2021 28Production sites of CropEnergies
CropEnergies AG
Mannheim - Germany
Zeitz – Germany Wanze – Belgium Loon-Plage – France Wilton – UK
CropEnergies Bioethanol GmbH BioWanze SA Ryssen Alcools SAS Ensus UK Ltd
400,000 m³ ethanol 300,000 m³ ethanol > 100,000 m³ ethanol for fuel 400,000 m³ ethanol
350,000 t DDGS Capacity: more
Annual thereof up to 60,000 m3 neutral > 60,000 t wheat gluten applications
than 1.3 Mm³
capacity: alcohol > 400,000 t ProtiWanze® 90,000 m³ ethanol for traditional
ethanol and more
> 300,000 t ProtiGrain® (DDGS) and technical applications
than 1 Mt food and
100,000 t liquefied CO2
animal feed per
Raw
Grain year
materials: Grain and sugar syrups Grain and sugar syrups Raw alcohol
December 2021 29Financial Calender
12 January 2022: Statement for the 1st-3rd quarter of 2021/22
Contact
18 May 2022: Annual report and press and analysts‘ conference FY 2021/22 CropEnergies AG
6 July 2022: Statement for the 1st quarter of 2022/23 Maximilianstraße 10
12 July 2022: Annual General Meeting 2022 68165 Mannheim
12 October 2022: Report for the 1st half of 2022/23 www.cropenergies.com
Investor Relations Public Relations / Marketing
Stock Information Heike Baumbach Nadine Dejung-Custance
ISIN: DE000A0LAUP1 Phone: +49 (621) 71 41 90-30 Phone: +49 (621) 71 41 90-65
Symbol: CE2 ir@cropenergies.de presse@cropenergies.de
Bloomberg / Reuters: CE2 GY / CE2G.DE
Transparency standard: Prime Standard
Disclaimer
This presentation contains forward looking statements. The statements are based on current assumptions and estimates made by the executive board and information currently available to its members. The forward looking
statements are not to be viewed as guarantees of the future developments and results presented therein. Future developments and results are in fact dependent on a variety of factors and are subject to various risks and
imponderables. They are based on assumptions that could in fact prove to be invalid. The risk management report in the current annual report presents an overview of the risks. We assume no obligation to update the forward-
looking statements made in this presentation. In addition, all disclaimers published on the CropEnergies website apply.
This presentation includes percentage and number rounding. Typing and printing errors reserved.
Written and visual value statements are standardized as follows:
± 1% - stable ± 1 – 4% - slight 30
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