FUCHS PETROLUB AG The leading independent lubricants ... · FUCHS is the world market leader in...

FUCHS PETROLUB AGThe leading independent lubricantsmanufacturer of the world

Dr. Alexander Selent, Vice Chairman & CFOReiner Schmidt, Member of the Group Management Committee

January 2013

FUCHS PETROLUB AG2

The leading independent lubricants manufacturer of the world

� Founded in 1931

� 2011 sales revenues: €1,668.1 million

� 2011 number of employees: 3,722 from 36 countries and 50 companies

� 34 production facilities

� 100,000 customers in more than 100 countries

� Member of the MDAX, DAXplus Family 30 and STOXX Europe 600

FUCHS PETROLUB AG3

FUCHS - business model

� FUCHS is fully focussed on lubricants (advantage over major oil companies)

� Technology, innovation and specialisation leadership in strategically important product areas

� Independence allows customer and market proximity, responsiveness, speed and flexibility (advantage over major oil companies)

� FUCHS is a full-line supplier (advantage over most independent companies)

� Global presence (advantage over most independent companies)

FUCHS PETROLUB AG4

FUCHS - long-term strategic objectives

� Continue to be the world’s largest independent manufacturer of lubricants and related specialities

� Value-based growth through innovation and specialisation leadership

� Organic growth in emerging markets and organic and external growth in mature markets

� Creating shareholder value by generating returns above the cost of capital

� Remain independent which is decisive for FUCHS’ business model

FUCHS PETROLUB AG5

Regional Breakdown Global Lubricants Demand

Global Lubricants Demand 2011: 35,1 mn t

Asia-Pacific41%

North America20%

Central/Eastern Europe

9%

Western Europe

11%

Latin America8%

Middle East6%

Africa5%

� The largest and fastest growing regional lubricants market is Asia Pacific.

� North America and Western Europe are mature markets. The focus is on higher value lubricants and specialities.

Source: FUCHS Global Strategic Intelligence

FUCHS PETROLUB AG6

2011 per-capita lubricants demand shows significant growth opportunities

5.0

1.83.6

4.9

7.88.7

9.8

19.8

0

5

10

15

20

North

Amer

icaW

ester

n Eur

ope

Middle

East

Centra

l / Eas

tern

Eur

ope

Latin

Amer

icaAsia

-Pac

ific

Africa

Wor

ld

kg


FUCHS PETROLUB AG7

manufacturers:

130 major oil companies

590 independent manufacturers

720 manufacturers*

Competition – strong fragmentation

High degree of fragmentation continues in the industry

Concentration especially among smaller companies

Differences in the size of manufacturers are enormous. World-wide the top 10 finished lubricants manufacturers including FUCHS hold more than 50% of global volumes while the remainder of more than 700 manufacturers share less than 50%.

sizes:

manufacturers volumes

%

top 10 > 50.0

710 < 50.0

720 100.0


FUCHS PETROLUB AG8

FUCHS – strategic position

FUCHS PETROLUB AG9

FUCHS is strategically well positioned as we are the 9th largest lubricant company in the world*

SHELLEXXON BP

CHEVRON

TOTALPETROCHIN

ASIN

OPECID

EMITSU

FUCHSNIP

PON OIL

LUKOIL

VALVOLI

NEPETRONASPERTAM

INA

INDIA

N OIL

* by volume


FUCHS PETROLUB AG10

Among 590 independent lubricants companies FUCHS is the number 1.

FUCHS PETROLUB AG11

World Lubricants Market 2011

MWF/CP/Greases*

8.4%

Industrial Oils

25.8%

Automotive Oils

55.6%

Process Oils

10.2%

FUCHS is the Specialist for Lubricants

FUCHS Finished Lubricants 2011

MWF/CP/Greases*

31.5%

Industrial Oils

25.2%

Automotive Oils

41.8%

Process Oils1.5%

*metalworking fluids/corrosion preventatives/lubricating greases


FUCHS PETROLUB AG12

FUCHS is the world market leader in strategically important and high-value business segments and niches

� High-performance speciality open gear No. 1 lubricants (cement industry etc.)

� Mining specialities (fire-resistant No. 1hydraulic fluids for underground coal mining and high-performance lubricants

� Environmentally friendly and No. 1 biodegradable lubricants and processing fluids

FUCHS PETROLUB AG13

FUCHS is the world market leader in strategically important and high-value business segments and niches

� Metalworking fluids No. 2-4

� Corrosion preventives No. 2

� Forging lubricants No. 2

� Greases No. 3-4

FUCHS PETROLUB AG14

10% of total staff – more than 350 chemists, enginee rs and other technical experts – work in R & D around the globe a nd ensure technical leadership in key products and applicatio n areas.

FUCHS research and development

FUCHS PETROLUB AG15

FUCHS PETROLUB Group Customer PortfolioCustomer Sectors*

Trade 26%

Energy & M ining 9%

Engineering 9%

Vehicle Components 9% Vechicle M anufacturing 13%

Producer Goods14%

Capital & Consumer Goods 6%

Transport & Service 3%

Construction 2%Other Sectors 2%

Agriculture & Forestry 7%

*Breakdown as percentage of sales 2011


FUCHS PETROLUB AG16

FUCHS manufactures in 34 production plants all over the world

FUCHS PETROLUB AG17

Comments

around € 1.7bn in sales (70% outside Germany, Asia Pacific is FUCHS’ 2nd largest regional market), #9 worldwide and by far the largest independent producer, close to customers

leader in innovation, specialisation& technology, clear focus on high-value products & market segments, basis for strong profitability, high cash flows & value creation

optimized and highly flexible cost structure, highly committed teams in management, production, R&D, sales and admin supported by company’s independence, steering via FVA tool successful

Size & GlobalPresence

Focus On Higher ValueLubricants

High DegreeOf Specialisation &

Technical Excellence

MotivatedEmployees

Local & FlatOrganisation

Independence & Financial Strength

FUCHS’ strategic position is a combination of…

FUCHS PETROLUB AG18

The business model has paid dividends

FUCHS PETROLUB AG19

2011 was for FUCHS a record year for sales, we have doubled sales since 1999. CAGR is 6%

834

1,39

4

1,36

5

1,32

3

1,19

2

1,09

6

1,06

5

1,17

8 1,45

9

1,66

8

1,04

1

0

300

600

900

1.200

1.500

1999 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Euro mn

CAGR 6 %

FUCHS PETROLUB AG20

2011, a new record year for EBIT, CAGR is 15.9% for the last ten years

264.2250.1

179.9171.7195.2

161.2

128.8

94.884.480.660.6

15.7%

6.3%7.6% 8.1%

8.8%

10.7%

12.1%

14.1% 14.7%

16.6%

12.1%

020406080

100120140160180200220240260280

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

EB

ITD

A (

EU

R m

n)

5%

7%

9%

11%

13%

15%

17%

19%

EBIT EBIT margin before income from participations

EB

IT (

Eur

o m

illio

n)

EB

IT m

argi

n be

fore

in

com

e fr

om p

artic

ipat

ions

CAGR 15.9%

39.0% 5.6%4.8%-12.0%21.1%25.2%35.9%12.3%4.7%33.0%--EBIT growth

FUCHS PETROLUB AG21

19.0

183.4

34.7 40.248.7

74.2

97.2

120.3 110.3

121.4

171.6

2.0%

3.3% 3.9%4.4%

6.2%

7.3%

8.8%

7.9%

10.3%

11.0%11.8%

0

20

40

60

80

100

120

140

160

180

200

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

0%

2%

4%

6%

8%

10%

12%

14%

2011, a new record year for net profit, CAGR is 25.4% for the last ten years

41.4% 6.9%- 8.3 %23.8 % 10.1%52.4 %21.1 % 31.0 %15.9 %82.6 %net profit growth

Net

pro

fit (

Eur

o m

n)

Net

pro

fit m

argi

n

CAGR 25.4%

FUCHS PETROLUB AG22

-50

0

50

100

150

200 Euro mn

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Fuchs Value Added (FVA)

Fuchs ValueAdded (FVA) -13.6 10.3 24.1 37.4 71.4 100.3 136.5 110.1 116.8 182.7 186.8

Again, we have generated a significant premium on our cost of capital (FVA)

FUCHS PETROLUB AG23

Interim report September 2012

FUCHS PETROLUB AG24 FUCHS PETROLUB AG24

� Sales revenues and earnings enjoy double-digit growth

� Earnings before interest and tax (EBIT) up 12.3 % to €224 million

� Positive outlook for the financial year

� Sales revenues and earnings enjoy double-digit growth

� Earnings before interest and tax (EBIT) up 12.3 % to €224 million

� Positive outlook for the financial year

Interim Report as at September 30, 2012

FUCHS PETROLUB AG25

469.2461.6448.4412.3420.9414.6403.8

0

100

200

300

400

500

Q1 '11 Q2 '11 Q3 '11 Q4 '11 Q1 '12 Q2 '12 Q3 '12

Previous year‘s figures have been adjusted for reasons of comparability

At € 469.2 million (420.9) sales revenues in the third quarter of 2012 hit a new record

Quarterly sales revenuesEuro million

+11.5% YoY

FUCHS PETROLUB AG26

78.872.972.5

63.966.166.167.4

0

20

40

60

80

Q1 '11 Q2 '11 Q3 '11 Q4 '11 Q1 '12 Q2 '12 Q 3 '12

At € 78.8 million (66.1) EBIT in the third quarter of 2012 hit a new record

Quarterly EBIT development Euro million

Previous year‘s figures have been adjusted for reasons of comparability

+19.2% YoY


1.4

89.61,239.3

1,379.2

48.9

900

950

1000

1050

1100

1150

1200

1250

1300

1350

1400

organic growth

Sales1-9/2011

Sales1-9/2012

external growth

currency effects

� Organic growth of 7.2 % or €89.6 million

� External growth 0.1 % or €1.4 million

� Currency effects of 4.0 % or €48.9 million

Euro mn Increase in sales by 11.3 % or €139.9 million to €1,379.2 million (1,239.3)

The growth in sales revenues was driven by increased sales volumes, raw material related price increases and by positive effects from currency translations


1.4 1.45.827.2

16.248.9

55.8 31.316.9

89.6

0

2 0

4 0

6 0

8 0

10 0

12 0

14 0

Euro mn

58.5Asia/Pacific,

Africa

33.1North and

South America

* incl. consolidation effects of -€53.6 million

Total Growth in % + 8.3 + 19.1 + 15.7 + 11.3

139.9Group

63.0Europe

Organic Growth

External GrowthCurrency Effects

Organic Growth in % + 7.3 + 10.2 + 8.0 + 7.2

All three world regions have contributed to the sales growth


EBIT has increased by 12.3% or €24.6 million

Euro mn 1-9/2012 1-9/ 2011 Variance

Sales Revenues 1,379.2 1,239.3 139.9 11.3 %

Gross Profit 503.0 458.0 45.0 9.8 %

Gross Profit Margin 36.5 % 37.0 %

Admin., Sales, R&D and other expenses 289.5 262.7 26.8 10.2 %

Expenses as a percentage of sales 21.0 % 21.2 %

EBIT before income from participations 213.5 195.3 18.2 9.3 %

EBIT margin before income from participations 15.5 % 15.8 %

Income from Participations 10.7 4.3 6.4 148.8 %

EBIT 224.2 199.6 24.6 12.3 %

Earnings after Tax 156.9 136.9 20.0 14.6 %

Net Profit Margin 11.4 % 11.0 %

Earnings per ShareOrdinary Preference

2.192.21

1.911.93

0.28 14.7 %0.28 14.5 %

FUCHS PETROLUB AG30 FUCHS PETROLUB AG

0

50

100

150

200

250

(previous year‘s figures in brackets)

Europe North and South America

AsiaPacific,Africa

Holdingcosts/cons.

Group

104.4(101.9)

71.0(54.6)

51.5(46.2)

226.9(202.7)

224.2(199.6)

-2.7(-3.1)

Euro mn

EBIT margin before income from participations

12.6 %

(13.3)

16.8 %

(16.8)

21.1 %

(21.9)

15.5 %

(15.8)

All three world regions have contributed to the EBIT growth

2.5 %

30.0 %

11.5 % 12.3 %

EB

IT


Free cash flow

Euro million 1-9/2012 1-9/2011

Gross cash flow

Changes in net current assets

163.4

-47.2

147.4

-81.3

Other changes 14.5 15.5

Operating cash flow 130.7 81.6

Investments -47.6 -24.4

Other changes 5.4 2.9

Free cash flow 88.5 60.1


47.6

24.4

1-9/2012 1-9/2011

Investments in R&D and Emerging Markets according to Plan

Euro millionKey Investments

� New Research and development center in Mannheim completed

� Construction of a facility in Russia and China

� Modernization of US production site

� Increase in capital in Turkey for acquiring an automotive lubricant business

FUCHS PETROLUB AG33

Major projects

CHINA: Shanghai (2008)India: Mumbai (2010) Russia: Kaluga (2011/2012)CASSIDA

Germany: Mannheim Germany: KielGermany: Kaiserslautern Germany: Mannheim


3,757

3,679

'30.09.2012 30.09.2011*

Number of employees has increased

78 additional employees mainly in R & D and sales

* comparable


Outlook

Based on the premise that the overall economic situation will not be subject to significant change in the fourth quarter, we expect earnings before interest and tax (EBIT) for the financial year to be around 10% over the previous year’s figure. This prediction is based on the assumption that raw material costs and sales prices will remain largely stable.

The high capital expenditure of the first nine months is set to continue over the coming months. Nevertheless, free cash flow should be above €100 million.

FUCHS PETROLUB AG36

Shareholder structure

FUCHS PETROLUB AG37

Shareholder structure as of 31 December 2011

Ordinary shares in %Maw er Investment Management Ltd.,

Canada 3.0%

Others40.1%

Fuchs family51.7%

DWS Investment, Frankfurt

5.2%

Total equity in %

Others74.2%

Fuchs family25.8%

Base: 35,490,000 shares Base: 70,980,000 shares(ordinary shares) (ordinary and preference shares)

FUCHS PETROLUB AG38

Mission statement

LUBRICANTS .

TECHNOLOGY.

PEOPLE.

FUCHS PETROLUB AG39

Disclaimer

This presentation contains statements about future development that are based on assumptions and estimates by the management of FUCHS PETROLUB AG. Even if the management is of the opinion that these assumptions and estimates are accurate, future actual developments and future actual results may differ significantly from these assumptions and estimates due to a variety of factors. These factors can include changes to the overall economic climate, changes to exchange rates and interest rates and changes in the lubricants industry. FUCHS PETROLUB AG provides no guarantee that future developments and the results actually achieved in the future will agree with the assumptions and estimates set out in this presentation and assumes no liability for such.

FUCHS PETROLUB AG40

FUCHS PETROLUB AG

Public Relations / Investor Relations

Friesenheimer Str. 17

68169 Mannheim, Germany

Phone +49-621 3802 1124, Fax +49-621 3802 7274

[email protected] , www.fuchs-oil.com

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