Analyst Conference
13 May 2020
Joachim Lutz, CEO Dr Stephan Meeder, CFO
Overview
Changes in executive board | Revenues / EBITDA [M€] | |||
1,.000 | 250 | |||
Financial year 2019/20 with record revenues and profit | 882 | 899 | 200 | |
Climate discussion sets new impulses, RED II in force | 779 | 150 | ||
Dividend proposal: 30 (15) eurocent per share | 800 | 146 | ||
100 | ||||
111 | ||||
Corona pandemic | ||||
72 | 50 | |||
Lockdown reduces energy demand | 600 | 0 | ||
Fight against virus increases demand for disinfectants and sanitizers | 17/18 | 18/19 | 19/20 | |
Outlook 2020/21 | European ethanol prices [€/m3] | |||
750 | ||||
Impact of corona on ethanol demand and prices unclear | 650 | |||
Operating result well below previous year, Q1 approx. balanced | 550 | |||
Strategic outlook | 450 | |||
Climate change remains a challenge: GHG targets still valid | ||||
FY 18/19 | FY 19/20 | FY 20/21 | ||
Diversification of portfolio towards bio-based products | 350 | |||
ANALYST CONFERENCE | 2 |
Changes in executive board
New on executive board
Dr Fritz Georg von Graevenitz (42)
Joined board on 1 October 2019 / CSO since 1 March 2020
Jürgen Böttcher (59)
CTO as of 1 May 2020
Retirement
Michael Friedmann (65, CSO)
on 29 February 2020
Joachim Lutz (63, CEO)
at the end of the annual general meeting on 14 July 2020
As of 15 July 2020
Dr Stephan Meeder (CEO), Jürgen Böttcher (CTO), Dr Fritz Georg von Graevenitz (CSO)
ANALYST CONFERENCE | 3 |
Two challenges of our times
GHG emissions: worldwide >50 bn. t CO2eq./a | Corona: worldwide more than 4 million infected |
As of 11 May 2020 |
Source: EEA | Source: https://www.worldometers.info/coronavirus/worldwide-graphs/#total-cases |
ANALYST CONFERENCE | 4 |
More climate protection for Germany & Europe
- EU targets in transport 2020
- - 6% GHG emissions in fuels; 10% renewables
- EU: on the way to climate neutrality in 2050
- Currently: 40% less GHG - thereof non-ETS (e.g. transport): -30%
- "Green Deal": EU climate target 2030 to be increased to 50-55%
DE: GHG emissions [Mt CO2eq.]
900 | 866 | 813 | Industry | |||
196 | Energy | |||||
186 | ||||||
other non-ETS | ||||||
600 | 543 | |||||
311 | 280 | Transport | ||||
140 | ||||||
300 | 162 197 | 150 197 | 95 133175 | 375 |
0 | ||||
- EU: RED II demands more renewable energy by 2030
- In transport at least 14% (total at least 32%)
GHG emissions from fuels [kg CO2eq./liter]
thereof crop-based: level of 2020 + 1%-point (max. 7%) | 4 | 3.4 | combustion | upstream | |
3.0 | |||||
3 | 2.7 | ||||
thereof min. 3.5% from waste and residues; add. increase renew. electricity | |||||
DE: climate protection law and "Brennstoffemissionshandels-Gesetz" | 2 | 2.8 | 2.3 | 2.1 | |
1 | 0.3 | ||||
Legal GHG limit in transport: 95 (150) Mt CO2eq. 2030 (2020) | 0.7 | 0.7 | 0.7 | ||
0 |
CO2 pricing of fossil fuels: from 25 €/t (2021) to 55 €/t (2025)
ANALYST CONFERENCE | 5 |
Market development: volumes
- Ethanol market in the EU27 & UK in 2019 (in million m³)
Production: | 7.5 | -4% | (5.1 fuel | 2.4 non-fuel) |
Consumption: | 8.4 | +4% | (5.8 fuel | 2.6 non-fuel) |
- Production in EU27 increases by 1% - decline in UK
- Corona crisis 2020: fuel drops, disinfectants (industrial) increase
- Premium E10 availability in the EU is gaining pace
- E10 established among others in Belgium and France as #1 petrol
- The Netherlands: since 1 Oct 2019 available with high acceptance
- Denmark, Lithuania, Slovakia und Hungary: since 1 Jan 2020
- Plans in Austria and Latvia
EU27: ethanol sales [1,000 m3]
7.,500 | 6,748 | 7,016 | 7,324 | 7,130 | |||||||||||||
860 | 870 | 800 | |||||||||||||||
855 | (2020) | ||||||||||||||||
5.,000 | 1,420 | 1,417 | 1,900 | ||||||||||||||
1,323 | |||||||||||||||||
2.,500 | 4,570 | 4,736 | 5,037 | 4,430 | F.O. Licht | ||||||||||||
0 | Source: | ||||||||||||||||
2017 | 2018 | 2019 | 2020 | ||||||||||||||
Fuel | Industrial | Potable | |||||||||||||||
E10 shares in selected countries
100% | 100% | 100% | 98% | 90% | 79% | 70% | 70% | 50% | 45% | 13% | ePURESource:(2020) | |||||||||||
50% | ||||||||||||||||||||||
0% | ||||||||||||||||||||||
ANALYST CONFERENCE | 6 |
Market development: prices
FY 2019/20: considerable increase of ethanol prices | European ethanol prices [€/m3] | |||
Ethanol*: 620 (500) €/m3 | 750 | |||
CO2 reduction as a price component | 650 | |||
550 | ||||
Feedstock market 2019/20 | 450 | |||
Grain**: 180 (190) €/t | 350 | FY 18/19 | FY 19/20 | FY 20/21 |
| EU grain harvest: 320 Mt (+10%) exceeds consumption of 290 Mt | |
| Word grain harvest***: 2,175 Mt (+2%) and stocks of 608 Mt (-3%) | Euronext Paris Wheat [€/t] |
IGC expects balanced market for 2020/21 with about 2,225 Mt | 250 | ||||
| Corona effect on ethanol prices in spring 2020 | 200 | |||
150 | |||||
FY 18/19 | FY 19/20 | FY 20/21 | |||
100 | |||||
* Ethanol T2 FOB Rdam, rounded ** wheat (Euronext Paris), next date of expiry, rounded | *** all varieties, except rice | ||||
ANALYST CONFERENCE | 7 |
Production in the CropEnergies group
Capacity utilisation 2019/20 follows market situation |
Ethanol production 1,002 (967),000 m³ (+4%) |
1.,200
Production
[1,000 m3 / 1,000 t]
9671,002
Production of food and animal feed on high level |
900
600
574580
Outlook 2020/21 |
Rededication of techn. alcohol as main component of disinfectants & sanitizers - |
challenge in production, sales and logistics mastered successfully |
Regular maintenance stoppage at BioWanze in Q1 2020/21 - |
restart of factory was severely delayed due to corona restrictions |
Biorefinery concept of CropEnergies |
Diversified production and product range |
Complete utilisation of all feedstock components |
300
0
2018/192019/20
ethanol | dried food and animal feed | |
Product mix 2019/20
[by weight, DM]
fuel
42% non-fuel*
58%
* proteins, neutral alcohol, liquefied CO2
ANALYST CONFERENCE | 8 |
Corona crisis: shifting priorities
- WHO: COVID-19 is declared a pandemic on 11 March 2020
- Increasing mobility restrictions in European countries
- Collapse of energy prices - weakest oil demand in 30 years
- EU petrol price decreases from 40 (Jan) to under 10 (Apr) eurocents/litre
- Soaring demand for disinfectants
- Enhanced hygiene requirements in hospitals, medical practices and pharmacies
- Germany, among others, facilitates use of ethanol
- Biocidal approval of technical alcohol and exemption from alcohol tax
- CropEnergies assumes social responsibility
- Alcohol for about 20 million litres of disinfectants and sanitizers
- Fair prices and high availability of technical alcohol mitigates shortage
- Priority for public health - fuel sales reduced
Energy price development | |||||||||||||
[€/m³] | 750 | ||||||||||||
500 | |||||||||||||
NYMEX Ethanol T2 FOB Rdam | 250 | ||||||||||||
Prem. Gas. 10 PPM FOB ARA | |||||||||||||
Light Sweet Crude Oil (WTI) | |||||||||||||
ICE Brent Crude | 0 | ||||||||||||
Alcohol from Zeitz for disinfectants | -250 | ||||||||||||
ANALYST CONFERENCE | 9 |
Outlook: short-term
- Trend in FY 2020/21 depends on containment of coronavirus
- EU Commission expects recession (GDP 2020: -7,4%)
- Pandemic and "lock-down" measures in Europe starting in mid-March affect 1st quarter of CE (1 Mar - 31 May 2020)
- Ethanol: demand stabilisation and chance for impulses
Ethanol industry is part of system-relevant infrastructure CE is facing high demand for disinfectants and sanitizers Normalisation of fuel demand expected in 2nd half of the year Targets for GHG reduction and renewable energy in force
- Price expectations in the EU: uncertainty will remain
- Volatility of ethanol prices will remain high
ANALYST CONFERENCE | 10 |
Strategic outlook
- Our strategy: bio-based products for a climate friendly world
- Climate change remains challenge: GHG targets remain in place
- Short-termfocus is the optimisation of our sites
- Diversification of feedstock flexibility and expansion of feed production in Zeitz completed
- Extension of cooperation with SOL group - construction of CO2 liquefaction in Wanze in preparation
- Mid-term:diversification under investigation
- R&D process innovation, alternative feedstocks
- R&D renewable chemicals, portfolio expansion/growth
Renewable chemicals
Liquefied CO2
Ethanol | Neutral alcohol |
Gluten
Fuel ethanol
ProtiGrain®
Animal feed
ANALYST CONFERENCE | 11 |
Overview 2019/20
- Ethanol production
- Revenues
- EBITDA
- Operating profit
- Income from operations
- Net income
- Net financial assets (vs. 28/02/2019*)
1,002 (967) ,000 m³ | + 4% | |
€ 899 (779) million | + € | 120 million |
€ 146.1 (72.1) million | + € | 74 million |
€ 103.9 (32.8) million | + € | 71 million |
€ 104.1 (43.1) million | + € | 61 million |
€ 74.6 (21.3) million | + € | 53 million |
€ 107 (27) million | + € | 80 million |
*incl. adjustments from IFRS 16
ANALYST CONFERENCE | 12 |
Revenues
(in € million) | 2019/20 | 2018/19 | |||||||||
Ethanol | 696.5 | 575.6 | + 21% | ||||||||
Food and animal feed products | 192.5 | 189.3 | + 2% | ||||||||
Other revenues | 10.2 | 13.8 | - 26% | ||||||||
Revenues | 899.2 | 778.6 | + 15% | ||||||||
Increase in total revenues due to higher ethanol sales prices and the expansion of production and sales volumes
Revenues 2019/20
Ethanol prices in reporting period with € 620/m3 significantly higher than in the previous year (€ 502/m3)
78%
21%
1% | ||||||
Ethanol | Food and animal feed products | Other revenues | ||||
ANALYST CONFERENCE | 13 |
EBITDA
(in € million) | 2019/20 | 2018/19 | ||||||||
Revenues | 899.2 | 778.6 | + 15% | |||||||
Overall performance | 890.9 | 782.7 | + 14% | |||||||
Cost of materials* | -652.2 | -617.1 | - 6% | |||||||
Spread (gross) | 238.7 | 165.6 | + 44% | |||||||
in % of overall performance | 26.8% | 21.2% | - | |||||||
Further operating expenses/income* | -92.5 | -93.5 | + 1% |
180 | EBITDA [M€] | ||
150 | 146 | ||
120 | 111 | ||
90 | 72 | ||
60 | |||
30 | |||
0 | |||
BY | BY | BY | |
17/18 | 18/19 | 19/20 |
EBITDA* | 146.1 | 72.1 | > + 100% | Spread (gross) / in % of overall | |||||||||
300 | performance [M€] | ||||||||||||
*without restructuring costs and special items | |||||||||||||
First-time adoption of IFRS 16 has positive effect on other operating | 250 | 239 | ||
200 | 206 | |||
expenses and therefore on EBITDA | 166 | |||
27% | ||||
Significant improvement of the gross margin despite a slight increase in | 150 | 23% | ||
raw material costs | 100 | 21% | ||
With € 146.1 (72.1) million, EBITDA reaches its highest level in company | ||||
50 | ||||
history | 0 | |||
BY | BY | BY | ||
17/18 | 18/19 | 19/20 | ||
ANALYST CONFERENCE | 14 |
Operating profit
Operating profit [M€] | ||||||
120 | 104 | |||||
(in € million) | 2019/20 | 2018/19 | ||||
Revenues | 899.2 | 778.6 | + 15% | 90 | ||
72 | ||||||
EBITDA* | 146.1 | 72.1 | > + 100% | 60 | ||
Margin | 16.3% | 9.3% | - | |||
Depreciation* | -42.2 | -39.3 | - 8% | 30 | 33 | |
Operating profit | 103.9 | 32.8 | > + 100% | |||
Margin | 11.6% | 4.2% | - | 0 | ||
BY | BY | BY | ||||
*without restructuring costs and special items | ||||||
17/18 | 18/19 | 19/20 |
| Rise in depreciation to € 42.2 (39.3) million due to first-time adoption of | 40 | Operating profit [M€] | |||
IFRS16 | 33.6 | |||||
The striking increase in EBITDA results into a trebling of operating profit | 30 | 28.6 | 26.6 | |||
to € 103.9 (32.8) million | ||||||
Operating margin improves accordingly to 11.6 (4.2)% | 20 | 15.2 | ||||
10 | ||||||
0 | ||||||
Q1 | Q2 | Q3 | Q4 | |||
19/20 | 19/20 | 19/20 | 19/20 | |||
ANALYST CONFERENCE | 15 |
Net earnings for the year
(in € million) | 2019/20 | 2018/19 | ||||||||
Operating profit | 103.9 | 32.8 | > + 100% | |||||||
Restructuring costs / special items | 0.0 | 10.1 | - 100% | |||||||
At equity result | 0.2 | 0.2 | + 4% | |||||||
Income from operations | 104.1 | 43.1 | > + 100% | |||||||
Financial result | -3.3 | -0.5 | < - 100% | |||||||
Earnings before income taxes | 100.7 | 42.5 | > + 100% | |||||||
Taxes on income | -26.2 | -21.3 | - 23% | |||||||
Net earnings for the period | 74.6 | 21.3 | > + 100% | |||||||
- Unrealized currency effects result in reduction of the financial result to € -3.3(-0.5) million
- Net earnings amounting to € 74.6 (21.3) million also reached a record level
100 | Net earnings for the year [M€] | ||
75 | 75 | ||
51 | |||
50 | |||
25 | 21 | ||
0 | |||
BY | BY | BY | |
17/18 | 18/19 | 19/20 |
ANALYST CONFERENCE | 16 |
Cash flow
(in € million)
Cash flow
Change in net working capital
Net cash flow from operating activities
Investments in property, plant et al. Payments into current financial investments
Cash flow from investing activities Cash flow from financing activities
2019/20 | 2018/19 | ||||||||
120.2 | 59.1 | + 61.1 | |||||||
5.0 | -24.7 | + 29.7 | |||||||
125.1 | 34.4 | + 90.7 | |||||||
-29.8 | -13.2 | - 16.6 | |||||||
-15.0 | 0.0 | - 15.0 | |||||||
-44.8 | -13.2 | - 31.6 | |||||||
-71.2 | -55.8 | - 15.4 |
Cash flow (+)/ | |
Investments (-) [M€] | |
150 | |
120 | |
100 | |
59 | |
50 | |
0 | |
-13 | |
-50 | -30 |
BY | BY |
18/19 | 19/20 |
Exchange rate changes | 1.4 | 0.5 | + 0.9 | Net financial position [M€] | |||
120 | |||||||
Change in cash and cash equivalents | 10.5 | -34.1 | + 44.6 | 107 | |||
90 | |||||||
29/02/2020 | 28/02/2019* | ||||||
Net financial assets | 107.3 | 26.9 | + 80.4 | 60 | |||
37 | |||||||
Capex higher at € 29.8 (13.1) million in order to improve production | |||||||
30 | 27* | ||||||
facilities | |||||||
Net financial assets increased significantly to € 107 (27) million | 0 | 28/02/18 | 28/02/19 | 29/02/20 | |||
*incl. adjustments from IFRS 16 | |||||||
ANALYST CONFERENCE | 17 |
Balance sheet
(in € million) | 29/02/2020 | 28/02/2019 | ||||||||
Assets | ||||||||||
Non-current assets | 384.7 | 382.7 | + 2.0 | |||||||
Current assets | 285.0 | 203.1 | + 81.9 | |||||||
Total assets | 669.6 | 585.7 | + 83.9 | |||||||
Liabilities | ||||||||||
Shareholders' equity | 502.9 | 448.7 | + 54.2 | |||||||
Non-current liabilities | 65.5 | 48.5 | + 17.0 | |||||||
Current liabilities | 101.3 | 88.5 | + 12.8 | |||||||
Total liabilities and equity | 669.6 | 585.7 | + 83.9 | |||||||
Capital Employed | 456.1 | 462.3 | - 6.2 | |||||||
ROCE | 23% | 7% | - | |||||||
Net financial assets | 107.3 | 26.9 | + 80.4 | |||||||
Equity ratio | 75% | 77% | - | |||||||
- The balance sheet total increases to € 669.6 (585.7) million
- ROCE improves significantly to 22.8 (7.1)%
Shareholders' equity [M€] | ||
520 | ||
503 | ||
490 | ||
460 | 449 | |
446 | ||
430 | ||
400 | ||
28/02/18 | 28/02/19 | 29/02/20 |
ANALYST CONFERENCE | 18 |
Dividend
(in € per share) | 2019/20 | 2018/19 | ||||||
Earnings | 0.85 | 0.24 | ||||||
Cash flow | 1.38 | 0.68 | ||||||
Dividend | 0.30* | 0.15 | ||||||
Payout ratio | 35% | 62% | ||||||
*proposal | ||||||||
Share price end of financial year | € 9.31 | € 5.29 | ||||||
Dividend yield | 3.2% | 2.8% | ||||||
- Payout ratio: 35 (62)% from consolidated net income IFRS
ANALYST CONFERENCE | 19 |
Outlook 2020/21
- Climate protection will remain an important environmental policy goal in the medium term
- The operating and mobility restrictions imposed throughout Europe since mid-March as a result of the corona pandemic are weighing on sales volumes and prices, at least in the short term
- Business development in the 1st quarter is being weighed down considerably due to the delayed maintenance work at the plant in Wanze, Belgium
- For the 1st quarter, only an approximately balanced operating result is currently expected
- CropEnergies expects an improvement in the course of the financial year, but with a significant decline in revenues and operating profit in comparison to the previous record year
- To what extent the increased use of ethanol for disinfectants can at least compensate for the reduced sales of renewable ethanol as a climate-friendly fuel is not yet foreseeable
- The forecast will therefore be substantiated in line with the course of the corona pandemic
ANALYST CONFERENCE | 20 |
Financial Calendar | ||
10 | July 2019: | Statement for the 1st quarter of 2019/20 |
16 | July 2019: | Annual General Meeting 2019 (virtual) |
09 | October 2019: | Report for the 1st half of 2019/20 |
13 | January 2020: | Statement for the 1st-3rd quarter of 2019/20 |
13 | May 2020: | Annual report and press and analysts' conference |
financial year 2019/20 | ||
Stock Information | ||
ISIN: | DE000A0LAUP1 | |
Symbol: | CE2 | |
Bloomberg / Reuters: | CE2 GY / CE2G.DE | |
Transparency standard: | Prime Standard |
Disclaimer
Contact
CropEnergies AG
Maximilianstraße 10
68165 Mannheim
www.cropenergies.com
Investor Relations
Heike Baumbach
Phone: +49 (621) 71 41 90-30
ir@cropenergies.de
Public Relations / Marketing
Nadine Dejung-Custance/
Clarissa Sonnenschein
Phone: +49 (621) 71 41 90-65
presse@cropenergies.de
This presentation contains forward-looking statements based on assumptions and estimates made by the executive board of CropEnergies AG. Although the executive board may be convinced that these assumptions and estimates are reasonable, the future actual developments and future actual results may vary considerably from the assumptions and estimates due to many external and internal factors. For example, matters to be mentioned in this connection include changes in the general economic conditions, competitive product and pricing pressures and developments in the regulatory framework. CropEnergies AG assumes no responsibility and accepts no liability for future developments and future actual results achieved being the same as the assumptions and estimates included in this presentation. This presentation includes percentage and number rounding.
ANALYST CONFERENCE | 21 |
Thank you!
ANALYST CONFERENCE | 22 |
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CropEnergies AG published this content on 13 May 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 13 May 2020 11:44:01 UTC