Schouw & Co. · PDF fileSchouw & Co. ABG Sundal Collier ... 140 years of history 125 years in packaging 25 years as a conglomerate 5 major investments

Schouw & Co.ABG Sundal Collier Small & Midcap Seminar

16 APRIL 2015

VP BUSINESS DEVELOPMENT, STRATEGY & IR KASPER OKKELS

Schouw & Co. at a glance16.04.2015ABG small & midcap seminar 2

BIOMARThe World’s third largest

manufacturer of quality feed for industrialised fish farming

FIBERTEX PERSONAL CAREThe World’s fifth largest producer

of spunbond for hygiene

FIBERTEX NONWOVENSLeading European manufacturer of

nonwovens for industrial applications

KRAMP (20%)The absolute largest supplier in

Europe of accessories and parts for farming

HYDRA-GRENELeading in Denmark within hydraulic

components and solutions

140 years of history 125 years in packaging

25 years as a conglomerate 5 major investments

Listed on Nasdaq Copenhagen since 1954

2014 revenue DKK 11.8bn EBIT 708m

About 15% return on invested capital

4.500 employees in more than 20 countries

Strong balance sheet virtually no debt

Long-term major shareholder

8.5bn

1.8bn

1.2bn

4.9bn

0.5bn

2014 reveue i DKK

We build a portfolio of leading Danish industrial businesses and develop them through value-creating, active and long-term ownership

No divestments of core businesses

Even bigger and stronger businesses

Further developthe portfolio

Open to value-creating ownership structures

16.04.2015ABG small & midcap seminar 3

Strong track-record

Revenue

12.0%Revenue CAGR 2010-2014 adjusted for sale of Martin and Grene

EBIT

16.2%EBIT CAGR 2010-2014 adjusted for sale of Martin and Grene

ROIC ex. goodwill

16.9%Growth in ROIC five years in a rowROIC incl. goodwill 14.0%

Reduction in NIBD

2.1bn2010-14 reduction due to strong CF, and effect from Vestas, Lerøy, Martin, Grene

Free Cash Flow

1.5bnAccumulated FCF incl. M&A 2010-2014 Operating CF 2010-2014 CAGR 15,5%

Shareholder yield

solidDividends increased every recent 4 years2010-2014 total share buyback 410m


All graphs are LTM and adjusted for the sale of Martin Professional and the financial effect from the combination of Grene and Kramp

Strategic goals16.04.2015ABG small & midcap seminar 5

Growth Substantial growth every year

Profit Benchmark level profitability

Return ROIC > 15%, but dependent on level of risk

Leverage Comfort zone for NIBD is 1-2 times EBITDA

Payout Constant/increasing dividends and share buybacks

Portfolio A ’handful’ of big and strong businesses

Looking towards 2020

Group highlightsSignificant and strong

businesses in the portfolio

Good momentum but still room for improvement

New activity in the portfolio under the right circumstances

Likely the strongest platform in 137 years of company history

Ambitious targets do not fulfill themselves

Global sizeActive participation in M&A

to drive consolidations

Geographical expansion in attractive growth markets

Operational streamliningSignificant investments will form

the basis for solid organic growth

Margin management to improve EBIT and generate significant cash flow


A very short updateon our businesses

BioMar16.04.2015ABG small & midcap seminar 8

Atlantic salmon, trout Atlantic salmon, coho, trout, tilapia

Sea bass, sea bream, portiontrout, eel, a.o.

Shrimp, tilapia, trout, sturgeon, turbot, catfish, pangasius, etc.

Market size ~2.0m tMarket growth* 5-6%Market share 20-25%


Market size ~0.7m tMarket growth 0-1%Market share 25-30%

Market size +10m tMarket growth 4-5%Market share -

*Long-term market growth over the ‘salmon cycle’; flat/negative volume development in 2015

NORTH SEA AMERICAS CONTINENTAL EUROPE ASIA

Profitable customers, high fish prices, limited short-term growth

Competition intense

Marine Harvest vertically integrated

Challenging farming environment

Feed players strong

Costa Rica as planed

Startup in shrimp feed

Running smoothly

Challenges in the Mediterranean Area

Realising pledges

Startup in Turkey

The largest farming region in the world

Feed quality low

Focus on partnerships with Asian businesses

Fibertex Personal Care

Stabile European market Almost 100% penetration

Growth from product innovation

Significant growth in Asia Middle class is growing

Increased penetration

Increased competition in Malaysia Pressure on prices

Decline in volume

Innowo Print 100% owned Leading in direct nonwoven print

Internationalisation

Differentiation important

Outlook Very volatile raw material prices

Guidance at 2014 levels


Fibertex Nonwovens

Leading in Europe in industrial nonwovens Many product applications

Needle punching and spunlacing technology

State-of-the-art technology

Customer groups Auto; part of the construc-

tion and as a ‘cheap fabric’

Construction; e.g. for infrastructure and composites

Industry; e.g. furniture, bedding and other cyclical businesses

Executing turnaround and growth plans International acquisitions

in 2011, 2014 and 2015

Not yet at target

Growth and consolidation remains high on the agenda

Outlook 2015 will be a transition year

New capacity required

Effect from expansion in USA and South Africa


Building Composites

Geotextiles Concrete

Bedding Flooring

Furniture Acoustics

Hood insulation Trunk carpets

Parcel trays Wheel housing

RevenueLTM

EBITLTM

Hydra-Grene

Hydraulic components and solutions Wind turbine manufacturers largest customer group

OEM and aftermarket in Denmark

Offshore oil and gas small but growing

Increase in sales to wind turbine industry Sub supplier margins are under pressure

Lower visibility in wind turbine industry

Hydra-Grene supplies many wind customers

Outlook Setback in wind in 2015 but growth in offshore

2015 guidance below 2014 levels


Kramp

Leading European supplier of spare parts and accessories for the agricultural sector #1 in BeNeLux, Germany, Poland and Nordic countries

9 central warehouses covering 22 European countries

20% ownership in Kramp from Grene merger in 2013

Outlook Continue integration and harvesting synergies

Expanding product ranges and growth through partnerships

Margin improvement and best practices

Optimizing working capital (stockturn)

2017 ambition revenue EUR 1bn and 13% EBITDA


Nine distribution centers covers 22 European countries. Former Kramp in blue, former Grene in orange and Russian JV in turquoise

Q&A

Appendix2014 Full Year Presentation

2014 at a glance: A good, solid year

revenue

11.8bnGrowth 1.2% // 2013: 11.6bnIncrease in activity in all businesses

EBIT

708m12% growth from comparable level in 201313m up due to payment on impaired receivable

cash flow from operations

628m2013: 667mFree cash flow 273m

NIBD/EBITDA

0.0xInsignificant increase in NIBD compared to 2013Dividends 153m // share buyback 180m (gross)

acquisitions

2 bolt-onFibertex Nonwovens: Platform in USAFibertex Personal Care: Printing on nonwovens

return on invested capital

16.9%ROIC incl. goodwill 14.0%Growth in ROIC five years in a row


200

220

240

260

280

300

320

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb

Schouw & Co. share priceC20 CAP indexed to Schouw & Co.MidCap indexed to Schouw & Co.

2014 2015

Key figures

Revenue and income 2014 2013

Revenue 11,784 11,645

EBITDA 1,070 1,039

- margin 9.1% 8.9%

EBIT 708 685

- margin 6.0% 5.9%

Value adjustment of financial investments 0 499

Cash flows 2014 2013

Cash flows from operating activities 628 667

Cash flows from investing activities -355 522

Of which investment in PPE -233 -346

Cash flows from financing activities -563 -687

Invested capital and financing 2014 2013

Working capital 1,775 1,424

Net interest bearing debt (NIBD) 44 -23

Total equity 6,074 5,746

ROIC excl. goodwill 16.9% 16.1%

ROIC incl. goodwill 14.0% 13.3%

NIBD/EBITDA 0.0 0.0

30%increase in share price

in 2014


BioMar

2014: Strong first half Modest increase in volumes, driven by Chile

EBIT increased due better than expected finish of the year

Unexpected payment lowered need for provisions by 13m

Fairly unchanged market shares throughout the year

Still pressure in salmon markets Region North Sea remains very competitive

Biology and salmon prices in Chile continues to be an issue

Strategy intact: Seeking growth in new markets/species

Moderate 2015 outlook Competition remains intense in key markets

Still uncertainty in southern Europe, especially Greece

No market growth anticipated


2014 highlightsVolume +1.6%Revenue –2.9%EBIT +10.2%

Revenue2013 8.7b2014 8.5b2015 ~8.5b

EBIT2013 394m2014 434m2015 360-410m

ROIC (ex gw)2013 20.1%2014 22.9%

RevenueLTM

EBITLTM

BioMar 2014-Q4 financials16.04.2015ABG small & midcap seminar 18

Q4 YTDLTM 2013

2014 2013 D 2014 2013 D

Revenue 2.234 2.341 -5% 8.451 8.702 -3% 8.451 8.702

EBITDA 169 190 -11% 574 538 7% 574 538

EBITDA% 7,6% 8,1% -7% 6,8% 6,2% 10% 6,8% 6,2%

EBIT 135 155 -13% 434 394 10% 434 394

EBIT% 6,0% 6,6% -8% 5,1% 4,5% 13% 5,1% 4,5%

Profit before tax 117 147 -21% 398 372 7% 398 372

Cash Flow from operations 262 342 -23% 266 373 -29% 266 373

Equity 1.902 1.765 8% 1.765

- in % of total assets 39,3% 38,9% 1% 38,9%

Inv. Capital (ex goodwill) 1.931 1.720 12% 1.720

- ROIC 22,9% 20,1% 14% 20,1%

Net Working Capital 983 741 33% 741

- in % of LTM revenue 11,6% 8,5% 37% 8,5%

NIBD 386 353 9% 353

- times LTM EBIDTA 0,7x 0,7x 2% 0,7x

Fibertex Personal Care

Growth from new capacity Volume growth driven by Malaysia

Over capacity and pressure on sales prices

Seamless running in of 4th production line in Malaysia

Better than expected capacity utilisation in Danish factory

Strong regional player Top 3 position in Europa and South East Asia

Operational excellence and innovation is mandatory

Acquisition of Innowo Print gives competitive edge

Consolidation in 2015 Internal optimization and focus on efficiency

New capacity to be installed – but not in 2015

Positive EBIT effect from falling raw material prices in Q1likely offset later in the year

2015 guidance around 2014 level


2014 highlightsVolume +11%Revenue +15%EBIT +5%

Revenue2013 1.6b2014 1.8b2015 ~1.7b

EBIT2013 164m2014 171m2015 160-180m

ROIC (ex gw)2013 13.6%2014 14.4%

RevenueLTM

EBITLTM

Fibertex Personal Care 2014-Q4 financials

Q4 YTDLTM 2013

2014 2013 D 2014 2013 D

Revenue 485 375 29% 1.787 1.554 15% 1.787 1.554

EBITDA 90 71 28% 308 288 7% 308 288

EBITDA% 18,6% 18,9% -1% 17,2% 18,6% -7% 17,2% 18,6%

EBIT 51 40 28% 171 164 4% 171 164

EBIT% 10,5% 10,6% -1% 9,6% 10,6% -9% 9,6% 10,6%

Profit before tax 59 39 52% 169 157 8% 169 157

Cash Flow from operations 30 -5 #### 226 208 8% 226 208

Equity 730 635 15% 635


Inv. Capital (ex goodwill) 1.336 1.192 12% 1.192

- ROIC 14,4% 13,6% 6% 13,6%


- in % of LTM revenue 16,4% 15,9% 3% 15,9%

NIBD 688 644 7% 644

- times LTM EBIDTA 2,2x 2,2x 0% 2,2x


Fibertex Nonwovens

Continuing positive momentum Strong growth in high-value segments

Substantial progress in EBIT

Effect from high volume and transformed business model

Leading in Europe – international focus State-of-the-art equipment at all sites

Strong platform in US following acquisition

Increased ownership stake in Fibertex South Africa

Promising pipeline; strong product development

2015 will be a transition year Upgrading technology and installing new capacity

Consolidation of South Africa (negative EBIT)

Uncertainty about raw material prices


2014 highlightsRevenue +12%EBIT +67%Turnaround completed

Revenue2013 932m2014 1,048m2015 ~1,200m

EBIT2013 37m2014 62m2015 65-75m

ROIC (ex gw)2013 5.1%2014 8.4%

RevenueLTM

EBITLTM

Fibertex Nonwovens 2014-Q4 financials

Q4 YTDLTM 2013

2014 2013 D 2014 2013 D

Revenue 262 218 20% 1.048 933 12% 1.048 933

EBITDA 28 23 20% 128 102 26% 128 102

EBITDA% 10,6% 10,6% 0% 12,2% 10,9% 12% 12,2% 10,9%

EBIT 9 7 25% 62 37 67% 62 37

EBIT% 3,4% 3,2% 4% 5,9% 4,0% 49% 5,9% 4,0%


Cash Flow from operations 13 12 6% 82 58 43% 82 58

Equity 385 314 23% 314


Inv. Capital (ex goodwill) 874 755 16% 755

- ROIC 8,4% 5,1% 63% 5,1%


- in % of LTM revenue 30,4% 30,6% -1% 30,6%

NIBD 522 452 15% 452

- times LTM EBIDTA 4,1x 4,4x -8% 4,4x


Hydra-Grene

Strong 2014 following high activity in wind Wind account for more than 40% of sales Effect from good utilisation of capacity Strong foothold in Danish OEM market

Developing the business Increasingly complex products and system solutions New ERP system implemented Wind turbine development projects, e.g. V164 Offshore segment gradually becoming a ‘third leg’

Lower activity in 2015 Lower sales to the wind turbine sector Increased international competition Variations in sales during the year Most industry/OEM stable, but agro-OEM sales down


2014 highlightsRevenue +18%EBIT +30%High activity in wind

Revenue2013 480m2014 566m2015 >500m

EBIT2013 46m2014 60m2015 45-55m

ROIC (ex gw)2013 18.2%2014 22.6%

RevenueLTM

EBITLTM

Hydra-Grene 2014-Q4 financials

Q4 YTDLTM 2013

2014 2013 D 2014 2013 D

Revenue 138 117 18% 566 480 18% 566 480

EBITDA 15 15 -1% 78 64 21% 78 64

EBITDA% 10,7% 12,7% -16% 13,8% 13,4% 3% 13,8% 13,4%

EBIT 10 7 60% 60 46 31% 60 46

EBIT% 7,6% 5,6% 36% 10,6% 9,6% 11% 10,6% 9,6%


Cash Flow from operations 40 20 98% 60 64 -6% 60 64

Equity 188 167 12% 167


Inv. Capital (ex goodwill) 292 292 0% 292

- ROIC 22,6% 18,2% 24% 18,2%


- in % of LTM revenue 33,1% 36,0% -8% 36,0%

NIBD 96 127 -24% 127

- times LTM EBIDTA 1,2x 2,0x -37% 2,0x


Kramp

2014: Growth in a difficult market Many agro customers facing difficulties

Kramp’s business model robust: high share of wearables and repair parts

Strong volume growth in Russia – but negative effect from weak RUB

Consolidating the merger Integration of organization, sales forces, procurement, etc.

Dual brand strategy in Poland implemented

Streamlining of assortment and product offering

Good outlook for 2015 Revenue forecasted to grow more than 5%, EBIT minimum the same

Recognised in Schouw & Co. as associate after tax at 55-65m

Synergies continues to materialise


2014 highlightsRevenue +7%EBIT +16%Progress in all countries

Revenue2013 4.6b2014 4.9b2015 ~5.25b

EBIT2013 349m2014 405m2015 425-450m

Other activities

Xergi Significant progress in 2014

Revenue up 52% to 311m (100%)

EBIT (for 100%) 13m (2013: 2m)

Maintaining high activity level also in 2015

Effect from many years of investing in technology and markets as well as strong Danish market

Unchanged good prospects for biogas

Incuba Invest Small deficit in 2014

Navitas Science Park commissioned in Q3

16% ownership in Capnova

Properties HQ at Chr. Filtenborgs Plads in Aarhus

Two factories in Frederikshavn (Martin Prof.)

Small property in Aarhus rented to former Grene Industri-service


2015 guidance

REVENUE DKK million

2015

forecast

2014

actual

2013

actual

BioMar c. 8,500 8,451 8,702

Fibertex Personal Care c. 1,700 1,788 1,554

Fibertex Nonwovens c. 1,200 1,048 933

Hydra-Grene above 500 566 480

Other/eliminations - -68 -24

Total revenue c. 12bn 11,784 11,645

Kramp (100%) c. 5,250 4,906 4,594

EBIT DKK million

2015

forecast

2014

actual

2013

actual

BioMar 360-410 434 394

Fibertex Personal Care 160-180 171 164

Fibertex Nonwovens 65-75 62 37

Hydra-Grene 45-55 60 46

Other c. -20 -20 43

Total EBIT 610-700 708 685

Associates etc. 60-70 28 -22

Financial investments - 0 499

Other financial items c. -35 -35 -53

Profit before tax 635-735 701 1,109

Kramp EBIT (100%) 425-450 405 349


AppendixSelected introductory presentation material

Merger

Grene/Kramp

Merger

NEG/Vestas

M&A activity16.04.2015ABG small & midcap seminar 29

MartinEV: 500m60+40%

2000 2002 2004 2006 2008 2010 2012 2014

SchulstadEV: 2.700m

62%

FibertexEV: 660m

100%

ProvimiEV: 675m

100% (BioMar)

TharreauEV: 300m

100% (FIN)

ElopakEV: 1.200m

50%

SjøtrollEV: 1.200m

51%

Hydro-power

MartinEV: 900m

100%

Merger

Xergi

BioMarEV: 1.800m68%+32%

GreneIndustri-service

NWSEV: 150m

100% (FIN)

InnowoEV: 100m85% (FPC)

Bigger and stronger portfolio

Bigger and stronger businesses in the portfolio

Consolidating theconglomerate

Deal flow is not a target

Acquisitions and mergerspart of consolidation

and to create bigger and stronger businesses

Divestments due to no longer being best owner

The Schouw agenda16.04.2015ABG small & midcap seminar 30

Develop big and strong businesses

Leading companies do perform better

Expand in growth markets

A global outlook is key

Constantly increase capacity

Balancing profit and growth

Maintain focus on innovation

Secure #1 positions

Think long-term

Ensuring high return on capital

Attract talent

“Results are created through people”

Conglomerate value creation16.04.2015ABG small & midcap seminar 31

FOCUSED OPERATIONS TRANSFORMATION

STRUCTURE AND DEVELOP OPTIMIZE OWNERSHIP

Delivering solid performance and growthTight/optimal capital allocationOngoing efficiencyEnsure innovation

Structural and strategic initiativesDevelopment of products and servicesGeographical expansionBolt-on acquisitions

Attractive acquisitionsLong-term planningAdd Schouw DNASecure leading positions

Necessary exits with good timingParticipate in value-added consolidationsConsider mergers, JVs, minority stakesValue-creating ownership structures

minimum as benchmark ambitious plans

risk and span of control best owner philosophy

Bu

sin

ess

leve

lG

rou

p le

vel

2005Acquisition of BioMar

2007Acquisition of Provimi

2012JV in

Costa Rica

2014JV in

Turkey

2011Expansion

in Myre

2002Acquisition of Fibertex

2003 Green-field in

Malaysia

2011 Acquisitionin France

EUR +300minvestments

in cap.

2004 Acquisition

in Czech

2011 FPC and FIN

demerger

1988Acquisition

of Grene

~1990Internatio-nalisation

2009 Grene/Hydra

demerger

2010 Hydra in China

and India

~1995 A strong focus

on industry

2015-Growth andacquisitions

2013 Grene/Krampcombination

10 years of strong growth and profitable development

14 years of transformation and expansion

27 years of active and developing ownership


Our mantra16.04.2015ABG small & midcap seminar 33

Businesses owned by Schouw & Co. should…secure and maintain a leading position

…develop after our active ownership model

…have a long-term growth strategy

…take part in value-creating consolidations

…generate ROIC above 15%

…have visible values and a strong culture

…be prepared for change

Investment guidelines (for platform investment)

We have a long-term investment strategy and is open to attractive acquisitions and appropriate divestments of companies

We have no predetermined exit strategy for the investments we make

We want to keep and develop its businesses as long as we are the best owner

We have clear targets for return on capital and profit for all investments

Area Criteria

IndustryB2B, preference for process industry and logistics/distribution

SizeRevenue – now or short-term realizable – of more than DKK 1bn

GeographyDanish headquartered (but international focus)

OwnershipPreferable wholly owned, but open to value-creating structures

Leading position

Within top 5 in its niche/segment

Manage-ment

Strong and ambitious. No operational resources at Schouw & Co. HQ

Need for a new owner

We need to bring something to the business

Possible to be active

Plans for development and transformation


Two main long-term shareholders Increase in share price and trading volume


Ownership

Givesco+EE32%

Hornsylds Legat15%

Treasury shares

8%

Danish (27%) and foreign (18%)

institutional and retail investors

45%

Sole purpose is owning shares in Schouw & Co.

Administrated by the Board of Directors in Schouw & Co.

Danish active family-owned business fund with activities

within bakery, industrial equipment, food/chocolate

and hardware.

75 75 84 77 77 102 128 153

115 81 101 15476 0

0

180

0

100

200

300

400

2007 2008 2009 2010 2011 2012 2013 2014

Dividends paid (DKK million) Share buy-back (DKK million)

Strong historical yield

0

2.000

4.000

6.000

8.000

10.000

12.000

0

50

100

150

200

250

300

350

400

Jan2012

Mar2012

May2012

Jun2012

Aug2012

Oct2012

Dec2012

Feb2013

Apr2013

Jun2013

Aug2013

Oct2013

Dec2013

Feb2014

May2014

Jul2014

Sep2014

Nov2014

Jan2015

Trading/day (3M average) Share price

2012

+61%

2013

+49%

2014

+30%

Strategic highlights in the businesses

BioMarContinued growth in existing marketsImproving profitability in NorwayLimiting risk throughout the value chainSalmon is below 5% of global farmed seafoodM&A to fuel volume ambition in new marketsConstantly above 5% EBIT margin

Fibertex Personal CareContinued growth in Asian demand for nonwovensSustaining superior quality and customer relationsFocus on improving profitability and returnLevering on full ownership in printing business15% ROIC and EBIT > 12%

Fibertex NonwovensIntegration and consolidation of investmentsContinuing transition from volume to value-addGrowth – both in and outside Europe8-9% EBIT target remains realistic

Hydra-GreneAdapting to volatility in global wind supplyGrowing in new segments, e.g. offshoreMaintaining ROIC > 15%

KrampHarvesting synergies and growing the integrated biz.Investing in new markets (West+East Europe)Revenue ambition of EUR 1bn and 13% EBITDA


Capital structure

It is not a target to remain debt-free Investments in our businesses (capex and bolt-on acquisitions)

will likely be the main use of liquidity

Comfort zone for NIBD is 1-2 times EBITDA

In 2015 dividends increased by 33% to DKK 8 DKK 8 corresponds to 2.8% of market cap end of 2014

or 48% of 2014 profit for the year

Dividends have been raised annually in four successive years

Share buybacks is periodically on the agenda Gross share buyback in 2014 was DKK 180m

Total buyback in 2010-2014 amounts to DKK 410m


Schouw & Co. aims to pay stable or growing dividends, always with due consideration for the company's earnings and any potential major investments or acquisitions.

Dividend policy

BioMar

Fish farming/feed geography16.04.2015ABG small & midcap seminar 39

Atlantic salmon, trout Atlantic salmon, coho, trout, tilapia

Sea bass, sea bream, portiontrout, eel, a.o.

Shrimp, tilapia, catfish, pangasius, etc.



Market size ~0.7m tMarket growth 0-1%Market share 25-30%

Market size +10m tMarket growth 4-5%Market share -

2014 revenue DKK 4.1bn 2014 revenue DKK 2.6bn 2014 revenue DKK 1.8bn

Brande, Denmark Dueñas, Spain

Nersac, FranceVolos, Greece

Castro, Chile

Pargua, Chile

Myre, Norway

Karmøy, Norway Grangemouth, UK Guanacaste, Costa Rica

*Long-term market growth over the ‘salmon cycle’; flat/negative volume development in 2015

Pargua, Chile

NORTH SEA AMERICAS CONTINENTAL EUROPE ASIA

BioMar’s strategy16.04.2015ABG small & midcap seminar 40

Organisationally and geographically

Focus on current daily

business

Actively utilise competences

across BioMar units

New geographies and species

Grow organically in line with existing markets

Establish units (incl. production) in 2-4 new geographies before 2017, to the extent possible focusing on a limited number of species (< 5)

Strengthen global capabilities

More well defined structures and systems

ELEMENTS DIRECTION AND PRIORITIES

Ambitions from 2012 strategy plan16.04.2015ABG small & midcap seminar 41

0

200

400

600

800

1.000

1.200

1.400

1.600

1.800

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

Volume (1000 tons)

Sales of approx. 1.7 m tons in 2017 Approx. half through organic growth The other half in new markets (acquisitions/JV’s/green fields) 5-6% EBIT margin ROIC > 15%

‘Beyond the limits’

‘Going for Profitable Global Growth’

‘Going for Global Growth’

BioMar group strategy:

0

2

4

6

8

10

196

0

196

4

196

8

197

2

197

6

198

0

198

4

198

8

199

2

199

6

20

00

20

04

20

08

20

12

20

16

20

20

20

24

20

28

20

32

20

36

20

40

20

44

20

48

Mega-trend driven demand16.04.2015ABG small & midcap seminar 42

The only sustainable way to increase the supply of fish is by fish farming.

It is not possible to increase the wild catch without environmental consequences.

Salmon is healthy

High content of vitamins and healthy fatty acids (Omega 3)

Effective growth

Low feed conversion ratio 1 kg feed gives almost 1 kg fish Fish adapts to temperature High yield (few bones and fins)

Stable supply

Multiple slaughtering periods and good forecasting systems

BioMarEWOSSkrettingMarine HarvestAustevoll/LerøyMultiple farmers

Africa

Asia

Population, billion

0,0

0,5

1,0

1,5

2,0

2,5

3,0

3,5

4,0wild catch aquaculture

Source: FAO, 2013, farmed and wild salmonids

GLOBAL POPULATION GROWTH

GROWTH IN AQUACULTURE

Revenue 8,451mEBITDA 574m- margin 6.8%

EBIT 434m- margin 5.1%

ROIC 22.9%Employees 904

AQUACULTURE BENEFITS

FOCUSED FISH FEED PRODUCER

2014 FINANCIALS

Revenue ~8,500mEBIT 360-410m

2015 GUIDANCE

BioMar growth potential

Existing markets Continued growth in salmon markets

Adequate capacity in medium term

Continental market expected to remain flat

Improvements due to scale, logistics and R&D

Maintaining market shares requires capex

New markets Huge ‘world’ outside existing BioMar markets

BioMar can add superior feed performance

Strong toolbox for optimising recipes

Continuous improvements and R&D

New raw materials

Ability to process recipes

Risk controlling in volatile raw material markets

Food safety and sustainability

However; farmed fish do not starve today!

Food safety and sustainability comes at a cost

High-value/EU-US consumed species likely step 1

Farmers need to be professional enough to measure and value performance, etc.


1.0m 3.0m 5.0mfarmed salmon/trout in Norway

1.2m 3.6m 6.0mtons feed used in Norway

5,5% 2,6%implied feed CAGR

Europe 4%

LatAm 4%

Other 3%

China 57%

Other Asia 32%

Salmonids 4%

Tilapia 4%Shrimps 8%Freshwater 10%Carps 40%

Other 34%

Source: SINTEF, 2012, Verdiskapingbasert på produktive hav i 2050

2010 2030 2050

The otherbusinesses in the portfolio

Fibertex Personal Care16.04.2015ABG small & midcap seminar 45

Global top 5 producer of nonwovens for hygiene

Supplies fabrics used in baby diapers, feminine hygiene and incontinence care products

Spunbond/spunmelt technology, an integrated one-step process – from raw material to fabric

Polypropylene is the key raw material

Strong regional business

3 production lines in Denmark

4 production lines in Malaysia

Printing facilities in Germany

Growing and staying market (no alternatives)

A regional industry ∙ customers and suppliers

Simple supply chain ∙ from PP to rolls of fabric

Large investments ∙ DKK +300m for a new line

High level of competence ∙ efficiency/quality

Low margin ∙ high volume

Service and innovation makes the difference

"Preferred" partner ∙ customized activities

Core business: Spunbond for hygiene

Large customers requiring good relationship

Sensitive, small and autonomous industry

Raw materials (few suppliers, linked to oil)

One supplier of machinery (Reifenhäuser)

Customers (limited number)

Commodity products (low-margin business)

Salary and level of energy in Denmark

Radical innovations are very difficult

HIGHLIGHTS THE BUSINESS MODEL

INDUSTRY CHARACTERISTICS




2014 FINANCIALS

Asian market continues to grow and requires significant capex

Increasing focus on value-added products (softer, bulkier, loftier and printed)


2015 GUIDANCE

Spunmelt is a regional industry16.04.2015ABG small & midcap seminar 46

EUROPEMarket size c. 450k t

Market growth c. 0-2%

FPC market share c. 10%

Customers P&G, SCA, KC,Hartmann, TZMO,Ontex, Abena, a.o.

Competitors Pegas, PGI,Fitesa, Union,

Dunour, Gulsan

ASIAMarket size c. 300k t

Market growth c. 10-12%

FPC market share c. 15%

Customers P&G, SCA, KC,Unicharm,Daio,

Henang, DSG, a.o.

Competitors Toray, PGI,Asahi, Mitsui,

Universial, AvgolAMERICASMarket size c. 400k t

Market growth NA c. 0-2%LatAM c. 10%

FPC market share 0%

Fibertex Nonwovens16.04.2015ABG small & midcap seminar 47

European top supplier of industrial nonwovens

Huge versatility in product applications

Needle punching and spunlacing technology

State-of-the-art technology on all sites

Ensure critical mass / continue profit increase

Leverage on European market leader position and increase global presence

Strong competitiveness through operational improvements and state-of-the art techonology

Continue transformation; reducing dependency on volume/commodity products and growing value-added/specialty products

Building Composites

Geotextiles Concrete

About ⅓ of revenue

Infrastructure growing in emerging markets

Value added products e.g. within composites

Geotex. is commodity

Bedding Flooring

Furniture Acoustics

Hood insulation Trunk carpets

Parcel trays Wheel housing


Market leader after French 2011 acquisition

Significant pipeline

Substitutes existing fabrics and part of car construction


Dependent on economic cycles

Volume products

Ongoing application extension e.g. nano

16kt capacity10kt capacity 16kt capacity

7kt capacity 4kt capacity

HIGHLIGHTS AUTO




2014 FINANCIALS

2015 will be a year of transition where new capacity will beinstalled and existingproduction lines will beupgraded.

EBIT target is 8-9%.


2015 GUIDANCE

STRATEGIC PRIORITIESCONSTRUCTION

INDUSTRIAL

Hydra-Grene16.04.2015ABG small & midcap seminar 48

Leading Danish supplier of hydraulic components

Specialised trade and engineering business

Strong R&D resources taking active part in customer product development

Solid base in Danish aftermarket and OEM

Long-term growth and huge potential in the global wind turbine industry

Aftermarket customers (~25% of total revenue) Both premium and low-cost items at stock Predominantly distributed through dealers End customers within agro, lift/truck, transport

OEM customers (~25% of total revenue) Product know-how and customer support key Component distribution and own production Prod. of blocks, pipes and pump stations End customers are manufacturers of agricultural equipment, lift/trucks, boats, etc.

Hydra-Grene’s position Present in Europe, China, India and USA Strong within gear (filter blocks and systems) Total solutions in water cooling and pumps

Trends and drivers Turbine manufacturers wants fewer suppliers Established manufacturers setting the standards Increased documentation and quality More focus on aftermarket services

HIGHLIGHTS THE DANISH INDUSTRIAL BUSINESS

Revenue 566mEBITDA 78m- margin 13.8%



2014 FINANCIALS

The offshore segment is gradually gainingimportance and willbecome a ‘thrid leg’.

Revenue >500mEBIT 45-55m

2015 GUIDANCE

SELECTED PRODUCTS AND BRANDS

THE GLOBAL WIND TURBINE INDUSTRY

Kramp

Leading European supplier of spare parts and accessories for the agricultural sector #1 in BeNeLux, Germany, Poland and Nordic countries

9 central warehouses covering 22 European countries

Combination of Kramp and Grene Grene wholly owned by Schouw & Co. since 1988

20% ownership in Kramp from non-cash merger between Grene and Kramp in 2013

Schouw & Co. owns 20%, management 50% and NPM Capital (Dutch long-term PE) 30%

Integration and harvesting synergies A perfect geographical match…

Expanding product ranges

Growing OEM business (partnerships)

Margin improvement through scale

Best practice (warehouse, IT, logistics)

Optimizing working capital (stockturn)

Potential annual synergies EUR 10-30m


Nine distribution centers covers 22 European countries. Former Kramp in blue, former Grene in orange and Russian JV in turquoise



Employees 2,604

2014 FINANCIALS


2015 GUIDANCE

Contact

Investor Relations CEO/President

Kasper Okkels Jens Bjerg Sørensen

[email protected] schouw @ schouw.dk

+45 87 34 58 24 +45 86 11 22 22

Schouw & Co. · PDF fileSchouw & Co. ABG Sundal Collier ... 140 years of history 125 years in packaging 25 years as a conglomerate 5 major investments

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