BASF Capital Market Story · 2018-11-17 · BASF Capital Market Story November 2016. 6. 150 years...

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1 150 years 150 years BASF Capital Market Story Manfredo Ruebens President Regional Functions North America, CFO BASF Corporation Baird 2016 Industrial Conference Chicago November 9, 2016

Transcript of BASF Capital Market Story · 2018-11-17 · BASF Capital Market Story November 2016. 6. 150 years...

  • BASF Capital Market Story November 2016 1

    150 years150 years

    BASF Capital Market Story

    Manfredo RuebensPresidentRegional Functions North America,CFO BASF Corporation

    Baird 2016 Industrial ConferenceChicago

    November 9, 2016

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    Cautionary note regarding forward-looking statements

    This presentation may contain forward-looking statements that are subject to risks anduncertainties, including those pertaining to the anticipated benefits to be realized from theproposals described herein. Forward-looking statements may include, in particular, statementsabout future events, future financial performance, plans, strategies, expectations, prospects,competitive environment, regulation and supply and demand. BASF has based these forward-looking statements on its views and assumptions with respect to future events and financialperformance. Actual financial performance could differ materially from that projected in theforward-looking statements due to the inherent uncertainty of estimates, forecasts andprojections, and financial performance may be better or worse than anticipated. Given theseuncertainties, readers should not put undue reliance on any forward-looking statements. Theinformation contained in this presentation is subject to change without notice and BASF doesnot undertake any duty to update the forward-looking statements, and the estimates andassumptions associated with them, except to the extent required by applicable laws andregulations.

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    Chemistry as an enabler BASF has superior growth

    opportunities: – sustainable innovations– investments– emerging markets

    The #1 chemical company €70.4 billion sales, €6.7

    billion EBIT bSI in 2015 #1-3 in ~70% of businesses,

    present in almost all countries

    6 integrated Verbund sites, production in 60 countries

    A track record of strong sales and earnings growth

    >3.5% dividend yield in every single year from 2006-2015

    ~€73.6 billion market capitalization on October 27, 2016

    PerspectiveLudwigshafen,Germany

    Antwerp,Belgium

    Nanjing,China

    Kuantan,MalaysiaGeismar,

    LouisianaFreeport,Texas

    Verbund site

    Positioning

    We create chemistry for a sustainable future

    Performance

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    Percentage of sales 2015*

    * Not depicted here: ~4% of Group sales reported as ‘Other‘ ** Natural Gas Trading has been divested on Sep. 30, 2015.

    BASF today – a well-balanced portfolioTotal sales 2015: €70.4 billion

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    Global reduction in carbon emissions of 6 million metric tons p.a. and reduction of waste

    Example Ludwigshafen site:avoidance of 7 million metric tons of freight p.a.= 280,000 fewer truckloads

    Shared use of on-site facilities: fire department, security, waste water treatment and analytics

    Verbund: Unique competitive advantage

    * Savings include only tangible synergies. Additional (intangible) benefits and retained profits are not included.

    Verbund generates >€1 billion p.a. global cost savings* and supports sustainability

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    €1.95 billion R&D expendituresin 2015; to be maintained in 2016

    ~10,000 employees in R&D

    ~3,000 projects

    Ranked No.1 in thePatent Asset Index™

    ~1,000 new patents in 2015

    Research Verbund: Cooperations with more than 600 excellent partners from universities, start-upsand industry

    Strong commitment to innovationInnovations for a sustainable future

    Key facts

    1.61.7

    1.8 1.9 1.95

    0.0

    0.5

    1.0

    1.5

    2.0

    2011 2012 2013 2014 2015

    R&D expenditures (billion €)

    Chemicals11%

    Performance Products20%

    Functional Mat. & Sol.20%

    Agricultural Solutions26%

    Oil & Gas2%

    Corporate Research21%

    2.0

    1.5

    1.0

    0.5

    0

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    Investments for organic growth

    Performance Products16%

    Oil & Gas24%

    €19.5billion

    FunctionalMaterials &Solutions12%

    Capex budget 2016-2020

    Other14%

    Chemicals30%

    Capex budget 2016-2020

    Asia Pacific18%

    €19.5billion

    South America*9%

    North America26%

    Europe46%

    AgriculturalSolutions4%

    Other1%

    by segment by region

    * Including Africa and Middle East

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    Functional crop care Personal care & food Omega-3 fatty acids Enzymes Battery materials Specialty plastics Selected assets in Oil & Gas Refinish coatings Surface treatment*

    BASFcore business

    Strong partnerships

    Gazprom Monsanto Petronas Shell Sinopec Statoil Total Yara

    Selected transactions 2010 − until today

    Acquisitions

    ~ €5.2 billion salesin emerging and innovation-driven

    businesses

    Divestitures

    Styrenics Fertilizers Selected assets in Oil & Gas Natural gas trading & storage Custom synthesis business Textile chemicals Polyolefin catalysts Industrial coatings*

    ~ €20 billion sales*in businesses with

    limited fit and differentiation

    potential

    Portfolio development towards more market-driven and innovative businesses

    * Closing expected in 2016

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    50

    100

    150

    200

    250

    300

    350

    2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

    Strong track record in operational excellence

    EBITDA

    Sales

    * Excl. companies with major IFRS 10/11 restatements, i.e. BASF YPC Nanjing, Libya onshore, other Oil & Gas and Catalysts companies

    BASF Group* 2001–2015(indexed; CAGR 2001–2015)

    Fixed Costs

    CAGREBITDA

    9%

    CAGRSales

    6%

    CAGRFixed Costs3%

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    0

    1,000

    2,000

    3,000

    4,000

    2015 2018

    Annual earnings contribution(in million €)

    Targeted annual earnings contribution of €1 billion from end of 2018 on

    Optimization of processes and structures in all regions, e.g.– manufacturing– incremental capacities– productivity increase

    Project timeline: 2016–2018

    DrivE program

    Strategic lever: Operational excellenceDrivE with ~€1 billion earnings contribution

    NEXT 2008-2011 DrivE 2016-2018

    STEP 2012-2015

    Diagramm1

    2015201520152015

    2018201820182018

    Sheet1!#REF!

    NEXT

    STEP

    NewPro

    1000

    1300

    1000

    1300

    1000

    Sheet1

    201420152018

    NEXT100010001000

    STEP100013001300

    NewPro1000

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    0

    1

    2

    3

    4

    5

    2007 2008 2009** 2010 2011 2012 2013 2014 2015 Q1-Q32016

    Free cash flow development

    * Cash provided by operating activities less capex ** 2009 adjusted for re-classification of settlement payments for currency derivatives

    Free cash flow*(in billion €)

    3.2

    2.5

    3.2

    3.9 3.7

    2.6

    3.2

    1.7

    3.6

    2.9

    Diagramm1

    2007

    2008

    2009**

    2010

    2011

    2012

    2013

    2014

    2015

    Q1-Q3 2016

    Free Cash Flow

    3.245

    2.502

    3.186

    3.912

    3.695

    2.587

    3.21

    1.7

    3.6

    2.9

    Sheet1

    200720082009**201020112012201320142015Q1-Q3 2016

    Free Cash Flow3.2452.5023.1863.9123.6952.5873.2101.73.62.9

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    0.0

    0.5

    1.0

    1.5

    2.0

    2.5

    3.0

    2006 2009 2012 2015

    2.90

    We want to grow or at least maintain our dividend at the previous year’s level

    Dividend of €2.90 per share, an increase of 3.6%

    Dividend yield of 4.1% in 2015

    Dividend yield above 3.5%in any given year since 2006

    4.6%

    Attractive shareholder return

    Key facts 2015

    Dividend per share (€)

    0.50

    1.00

    1.50

    2.00

    * Dividend yield based on share price at year-end

    4.1% 3.8% 7.0% 3.9% 3.7%Yield* 3.7%

    2.50

    3.5%

    3.00

    4.0% 4.1%

    1.50

    1.95 1.951.70

    2.202.50 2.60 2.70

    Dividend policy

    2.80

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    Average annual performance with dividends reinvested

    0 3 6 9 12 15

    Euro Stoxx 50

    DAX 30

    MSCI World Chemicals

    +5.5%

    Last 5 yearsNovember 2011 – October 2016

    +12.5%

    +8.3%

    +11.7%

    +9.9%

    Last 10 yearsNovember 2006 – October 2016

    BASF

    +6.9%

    +0.4%

    +13.1%

    Delivering consistent, long-term value

    Diagramm1

    MSCI World

    DAX

    Euro Stoxx

    BASF

    Ost

    9.1%

    12.0%

    8.1%

    6.9

    5.5

    0.4

    13.1

    Sheet1

    MSCI WorldDAXEuro StoxxBASF

    Ost6.95.500.413.1

  • BASF Capital Market Story November 2015 14

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    Slide Number 1Cautionary note regarding �forward-looking statements We create chemistry �for a sustainable futureBASF today – a well-balanced portfolio�Total sales 2015: €70.4 billionVerbund: Unique competitive advantageSlide Number 6Investments for organic growthPortfolio development towards more market-driven and innovative businessesStrong track record in operational excellence Strategic lever: Operational excellence�DrivE with ~€1 billion earnings contributionFree cash flow developmentSlide Number 12Slide Number 13Slide Number 14