Post on 08-Mar-2018
JotunPresentation
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Loyalty Care Respect Boldness
2%AM
10%WE
14%SCA
9%EECA
19%NEA
22%SEAP24%
MEIA
Sales15.8NOK billion
EBITA1.8NOK billion
EBITA margin11%
ROCE21%
+100Countries
37Factories
9 819Employees
67Companies
Jotun Today
Decorative paints
Protective coatings Powder coatings
Marine coatings
38%
10%27%
25%
Our Business Areas
0
500
1000
1500
2000
2500
0
2 000
4 000
6 000
8 000
10 000
12 000
14 000
16 000
18 000
19
72
19
74
19
76
19
78
19
80
19
82
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84
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86
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92
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96
19
98
20
00
20
02
20
04
20
06
20
08
20
10
20
12
20
14
20
16
Net Sales EBIT
Sales and EBIT
NOK million, Yearly
A story of growth…
22 407
15 785
4 681
3 2151 087 187
Jotun 100% MEIA NEA Group sales toJV/AV
Other income Jotun Group
-0.5%
NOK million, actual rates and growth %
Revenue bridge
-3%
100% figures vs Jotun Group reported figuresCompanies where Jotun hold 50% or less are not represented in Group Figures
• Approx. 680 shareholders
• Gleditsch family holds 54 %
• 59 % of votes
• Orkla holds 42,5 %
• 38,2 % of votes
• Historically careful dividend policy
• Good cooperation between Orkla and
the Gleditsch family
Ownership structure
Corporate responsibility has high focus
• Values
• Compliance manual
• Business principles
• Leadership expectations
• Jotun decision making model
• Dilemma training
• “Jotun Green Steps”
• Audit of suppliers
• Project standards
10 | Group Finance | Financial Statements 2016
Jotun Group
Operating Revenue
NOK million, actual rates, Year End
Sales slightly down after a outstanding 2015
10 659 11 351 12 034 13 171 16 282 15 785
9%6% 6%
9%
24%
-3%
2011 2012 2013 2014 2015 2016
Sales Growth
A few things to be aware of:
• Lower intercompany sales– Jotun Cosco, China
• Other income includedin operating revenue impactedby Egypt currency loss
11 | Group Finance | Financial Statements 2016
Jotun Group
690 1 126 1 257 1 314 2 064 1763
6.5 %
9.9 % 10.4 % 10.0 %
12.7 %11.2 %
0%
5%
10%
15%
20%
25%
30%
0
500
1 000
1 500
2 000
2 500
2 011 2012 2013 2014 2015 2016
Sales EBIT%
EBITA slightly down
NOK million, actual rates
EBITA & EBITA margin
• Second best result ever
• Claims
• Equity ratio strong and furtherimproved 53 % (2015: 52%)
Excluding currency effects:
Record sales in Deco and Powder
NOK million, fixed rates
Sales per segment (100%-basis)
Average growth (CAGR)
7.3%
9.9%
10.9%
8.1%
Total 9.3%3 037
6 0972 108
5 362
3 722
8 697
1 194
2 250
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
Powder
Deco
Protective
Marine
Indexed numbers, weighted average RM prices
Raw material trend – 2008-2016
Note 1: The ”Weighted average All” is based on all RMs in the scope of the report
Note 2: Re-purchase prices indexed based on purchased currency converted to USD
Forecast
70
90
110
130
150
170
Jan
-08
May
-08
Sep
-08
Jan
-09
May
-09
Sep
-09
Jan
-10
May
-10
Sep
-10
Jan
-11
May
-11
Sep
-11
Jan
-12
May
-12
Sep
-12
Jan
-13
May
-13
Sep
-13
Jan
-14
May
-14
Sep
-14
Jan
-15
May
-15
Sep
-15
Jan
-16
May
-16
Sep
-16
Jan
-17
May
-17
Consolidated Corporate Marine Protective Decorative Decorative (SCA) Powder
Consolidated raw material price
Maintaining the investment targets
985
1 201 1 209
1 332
6.1% 6.8%
5.4%
5.9%
2013 2014 2015 2016
Investments per year
NOK million, actual rates, % of sales
Investments per region 2016
NOK million, actual rates
MEIA; 427
SEAP; 306
CORP; 181
SCA; 129
EECA; 91
NEA; 90 WE; 81
AM; 26
Maintaining the investment targets
985
1 201 1 209
1 332
6.1 % 6.8 %
5.4 %
5.9 %
2013 2014 2015 2016
Investments year-end
NOK million, actual rates, % of sales
R&D• Product development• Labs: UK, Korea, India, Gimle
Production facilities• Oman• Philippines• Myanmar• Malaysia (Powder)• Thailand
(Warehouse)
Admin buildings• Vindal and Gimle in Norway• Mumbai office in India
Investing for future growth
New Factories:
• Completed 2016: Brazil Oman
• Under construction: Myanmar
• Started in 2016: Philippines and Malaysia (Powder)
• Prospects: Egypt
And:
New R&D Centre and Group headquarters in Sandefjord
Started before summer - completed early 2019
Investment NOK 1.1 billion – 34.000m2
People 2019: 250 in HQ and 300 in R&D
Capacity for growth
New HQ and R&D centre in Sandefjord, Norway
Investments and net debt development (Jotun Group, actual rates)
4391 336
1 919 2 235
4 265 3 956
5 208
7 1077 576
8 990
11 452
13 90614 374
-18
213 351 121 261 195 -167 4291 220 1 193 1 602
2 1081 667
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
Invested in factories and working capital Accumulated Net debt (accumulated)
Equity ratio – Jotun Group
NOK Million at year end
Solid financial position
Covenant: > 25%Target: > 50% Covenant: Below 4.0
Target: Maintain IG rating
57% 56%54%
51% 51% 52% 53%
2010 2011 2012 2013 2014 2015 2016
Equity ratio – Jotun Group
At year end
-0.1
0.6 0.6
0.8
1
0.60.7
2010 2011 2012 2013 2014 2015 2016
Net debt/EBITDA – Jotun Group
At year end
Debt and Financing Structure
• Long term debt is held by Jotun A/S
• Companies receive long term funding from Jotun
A/S
• Companies have local short term bank lines
• Jotun A/S repatriates cash through dividends and
royalty payments from companies
• Dividend to shareholders evaluated each year in
light of capital needs and solidity target
• Jotun A/S has the last 4 years paid NOK 513 mill
in yearly dividends
Dividend policy. Jotun Group.
• Same equitylast 5 years
• Maintain equityratio above50%
634
795857
946
1416
1132
513 513 513 513 513 513
2011 2012 2013 2014 2015 2016
Profit for the year Dividend
Dividend payments vs Profit
NOK Million at year end
Debt funding - Jotun A/S
Maturity Loan type Amount (MNOK)
May 2019 Bond 400
May 2021 Bond 300
Jan 2024 NIB loan* 1057
Sum 2357
*Nordic Investment Bank, USD 120 mill, USD rate 8,36
Loans per September 2016
Available credit lines - Jotun A/S
Long term Credit facilities per September 2016
Maturity Bank Amount (MNOK)
Years to maturity
August 2019 SEB 400 2
January 2021 DNB 400 3,5
Total 800
Financing needs going forward• Organic growth expected to continue
• Financing needed for investments and working capital
• Mostly financed by internal cash surplus, but
moderate debt increase is expected given present
dividend level
• New R&D facilities and offices in Sandefjord will
require financing in 2017/2018
− NOK 1 100 mill investment approved
• Norwegian bond market as primary funding source
• Jotun develops steady and asplanned
• Some headwinds in Marine andOffshore markets
• Still a lot of opportunities in othersegments
• Good cash flow and robust balancesheet
Summary