PETRI CASTRÉN, INTERIM PRESIDENT & CEO, CFO

OCTOBER 24, 2023

Continued strong profitability driven by record quarter in Industry & Water

JANUARY - SEPTEMBER 2023

Jari Rosendal in Memoriam

  • Kemira's long-serving President & CEO Jari Rosendal passed away unexpectedly after a short illness on July 31, 2023
  • Jari served as Kemira's President & CEO since 2014
  • Jari's legacy will remain with Kemira.
    Under his leadership, Kemira's profitability improved significantly, and the strategic focus shifted towards sustainable profitable growth. Jari's main focus was always the safety and wellbeing of employees, and he will be greatly missed.

O C T O B E R 2 4 , 2 0 2 3

Q 3 2 0 2 3 R E S U L T P R E S E N T A T I O N

2

Summary of Q3 2023

  • Resilience of business model demonstrated by another strong quarter
  • Excellent profitability development: Margin at the strong level of 19.3%, sequential improvement from Q2 2023
  • Revenue declined following lower sales volumes in Pulp & Paper. Operative EBITDA improved y/y and sequentially.
  • Record quarter in Industry & Water in terms of absolute operative EBITDA and margin
  • Net promoter score (NPS) improved further to 54 (2022: 53)
  • Strategic review of the Oil & Gas business ongoing
  • Second dividend installment of EUR 0.31 to be paid on November 2, 2023
  • 2023 outlook upgraded on October 10, 2023

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Financial highlights of Q3 2023

Revenue declined from high comparison period

  • Decline driven by lower sales volumes and lower sales prices for energy-intensive pulp and bleaching chemicals
  • Organic revenue growth -9% in Q3 2023; +2% in 1-9 2023
  • Sequential volume improvement in both segments

Strong operative EBITDA in Q3 2023

  • Operative EBITDA margin at the strong level of 19.3%, both y/y and sequential improvement
  • Record margin in Industry & Water, solid performance in Pulp & Paper despite weak market

Very strong cash flow from operations

Earnings per share EUR 0.46 in Q3 2023; EUR 1.48 in 1-9 2023

EUR million

Q3

Q3

Δ%

1-9

1-9

Δ%

FY

(except ratios)

2023

2022

2023

2022

2022

Revenue

828.7

971.9

-15%

2,574.8

2,601.3

-1%

3,569.6

Operative EBITDA

160.3

152.5

+5%

504.0

394.6

+28%

571.6

of which margin

19.3%

15.7%

-

19.6%

15.2%

-

16.0%

Operative EBIT

107.6

99.5

+8%

350.4

238.1

+47%

361.6

of which margin

13.0%

10.2%

-

13.6%

9.2%

-

10.1%

Net profit

75.2

60.3

+25%

238.4

149.4

+60%

239.7

EPS diluted, EUR

0.46

0.38

+23%

1.48

0.93

+59%

1.50

Cash flow from

173.1

114.8

+51%

412.7

145.4

+183%

400.3

operating activities

O C T O B E R 2 4 , 2 0 2 3

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Pulp & Paper: Early signs of market

bottoming

Market environment in Q3 2023

  • Market remained weak at Q2 2023 levels due to weak economic activity and inventory destocking. Market weak particularly in EMEA.
  • Early signs that market has reached the bottom, no meaningful recovery in sight yet

Organic growth Q3 2023: -19%;1-9 2023: -7%

  • Sales volumes declined following weak market volumes, sequentially volumes increased modestly

REVENUE AND ORGANIC REVENUE GROWTH (Y-ON-Y)

EUR million

488

537

556

505

420

447

421

404

370

378

391

2%

9%

11%

11%

17%

22%

29%

28%

12%

-10%

-19%

Q1

Q2

Q3

Q4

Q1

Q2

Q3

Q4

Q1

Q2

Q3

2021

2022

2023

OPERATIVE EBITDA AND OPERATIVE EBITDA-%

  • Market prices for energy-intensive pulp and bleaching chemicals declined following normalization of electricity prices

Operative EBITDA EUR 68.9 million

  • Operative EBITDA margin rather stable at 17.1% with sequential improvement -excellent achievement in a challenging market environment

EUR million

110.9

109.4

92.3

21.7%

63.5

71.3

73.6

19.9%

65.2

68.9

62.9

57.8

60.5

17.2%

17.0%

15.3%

16.2%

16.0%

15.5%

17.1%

15.1%

14.4%

Q1

Q2

Q3

Q4

Q1

Q2

Q3

Q4

Q1

Q2

Q3

2021

2022

2023

O C T O B E R 2 4 , 2 0 2 3

Q 3 2 0 2 3 R E S U L T P R E S E N T A T I O N

5

Industry & Water: Record-high operative

EBITDA

Market environment in Q3 2023

  • Water treatment: solid demand in municipal water treatment, softness in industrial demand
  • Solid Oil & Gas market, shale market consolidation continuing

Organic growth Q3 2023: +3%; 1-9 2023: +13%

  • Organic growth driven by Oil & Gas. Revenue in water treatment decreased by 5%, in Oil & Gas increased by +4%.

REVENUE AND ORGANIC REVENUE GROWTH (Y-ON-Y)

EUR million

435

419

425

412

402

374

322

279

301

298

237

-7%

28%

23%

23%

31%

26%

33%

32%

24%

14%

3%

Q1

Q2

Q3

Q4

Q1

Q2

Q3

Q4

Q1

Q2

Q3

2021

2022

2023

  • Sales prices increased, while sales volumes were stable. Sales volumes increased in Oil & Gas following successful product launches; water treatment sales volumes declined.

Record-high operative EBITDA: EUR 91.5 million

  • Operative EBITDA margin improved to 21.5% following strong performance in water treatment
  • Continued year-on-year margin improvement in the Oil &

Gas business

O C T O B E R 2 4 , 2 0 2 3 Q 3 2 0 2 3 R E S U L T P R E S E N T A T I O N

OPERATIVE EBITDA AND OPERATIVE EBITDA-%

EUR million

83.3

85.8

91.5

60.3

66.1

49.5

52.3

48.8

41.7

37.3

48.5

20.7%

20.5% 21.5%

17.6% 17.7% 17.4%

15.2%

13.0% 13.9% 16.1%

12.5%

Q1

Q2

Q3

Q4

Q1

Q2

Q3

Q4

Q1

Q2

Q3

2021

2022

2023

6

Profitable growth is at the heart of our strategy

FASTER-THAN-MARKET GROWTH

GROWTH POCKETS

NEW OPPORTUNITIES

M&A

INSIDE EXISTING

BUSINESSES

STRONG FOUNDATION AND ROBUST EXISTING BUSINESSES

O C T O B E R 2 4 , 2 0 2 3 Q 3 2 0 2 3 R E S U L T P R E S E N T A T I O N

7

We have three strategic priorities

EXPAND IN WATER

Significantly grow our water business by expanding to additional technologies and/or geographies both organically and inorganically

BUILD A LEADING RENEWABLE SOLUTIONS PORTFOLIO* Enable sustainability transformation in our existing markets and leverage our capabilities in new circularity- driven markets

CREATE A SIGNIFICANT

DIGITAL SERVICES

BUSINESS

Strengthen our value add for existing and new customers by continuing to build and scale digital services

*Previously called biobased strategy. Biobased is the most common and readily available renewable feedstock, but other renewable feedstocks like recycling-based or carbon dioxide- based are also becoming available at scale in the market in the future.

O C T O B E R 2 4 , 2 0 2 3 Q 3 2 0 2 3 R E S U L T P R E S E N T A T I O N

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Our renewable solutions strategy* is progressing

BIOMASS-BALANCED POLYMERS GAINING TRACTION

BIOMASS-BALANCED POLYMER REVENUE GROWING STRONGLY -ALBEIT FROM A LOW BASE

  • Kemira introduced biomass-balanced polymers in early 2022 with first commercial customer shipments in Finland in 2022
  • Aim to offer a sustainable solution for water treatment and paper & board customers where the majority of fossil based raw materials have been replaced by ISCC PLUS certified biobased feedstocks
  • Strong customer momentum in 2023:
    • Growing sustainability focus at municipal water treatment facilities
    • Kemira delivering currently to around 20 customers, such as to the City of Barcelona
    • First customers shipments outside the Nordics during 2023

O C T O B E R 2 4 , 2 0 2 3 Q 3 2 0 2 3 R E S U L T P R E S E N T A T I O N

January

February

March

April

May

June

July

August

September

2022 2023

*Previously called biobased strategy. Biobased is the most common and readily available renewable feedstock, but other renewable feedstocks like recycling-based or carbon dioxide-based are also becoming available at scale in the market in the future.

9

Financials

Q3 2023

O C T O B E R 2 4 , 2 0 2 3

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Kemira Oyj published this content on 24 October 2023 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 24 October 2023 05:38:37 UTC.