Umicore Investor Presentation
February 2021 Introduction to Umicore We are a global materials technology and recycling group
One of three global A leading supplier of key The world’s leading leaders in emission control materials for rechargeable recycler of complex waste catalysts for light-duty and batteries used in electrified streams containing heavy-duty vehicles and transportation and portable precious and other for all fuel types electronics valuable metals
3 With a unique position in clean mobility materials and recycling
Internal Plug-In Hybrid Combustion Engine Electric Vehicle Umicore provides: Umicore provides: Emission control catalysts Battery cathode materials and emission control catalysts
Full Electric Vehicle Fuel cells Umicore provides: Umicore provides: Battery cathode materials Electro-catalyst and battery cathode materials
Present across all drive trains and offering sustainable closed- loop services
4 Built on sound foundations
Supportive Unique business Industry leader in megatrends & model sustainability legislation
resource scarcity more stringent emission control
electrification recyclingrecycling of the automobile
We help improve air quality, make electrified transport possible and tackle resource scarcity
5 5 With a robust financial performance and a global presence
Key figures (FY 2020)
Adj. Revenues EBITDA € 3.2 bn € 804 m
Adj. EBIT ROCE € 536 m 12.1%
REVENUES BY GEOGRAPHY*
Europe
Clean North America mobility and R&D recycling 7% of South America 77% of revenues revenues Asia-Pacific
Africa * 2020 data 6 Successfully delivered Horizon 2020 growth strategy
Clear leadership in Turned sustainability clean mobility into a greater materials and competitive edge recycling
Rebalanced the Doubled the size of portfolio & earnings the business in terms contributions of earnings
7 With a focused Group structure
CATALYSIS ENERGY & SURFACE RECYCLING TECHNOLOGIES
Automotive Catalysts Rechargeable Battery Materials Precious Metals Refining Precious Metals Chemistry Cobalt & Specialty Materials Jewelry & Industrial Metals Electroplating Precious Metals Management Electro-Optic Materials
Capital employed* Revenues* Adj. EBIT* (excluding metal) (average) 12% 26% 26% 37% 42%
61%
13% 51% 32%
* FY 2020 data; corporate not included 8 Unique position in Automotive Catalysts CATALYSIS
Strong growth drivers: Umicore best positioned to Tightening emission norms for capture growth in growing LDV and HDD, in particular in gasoline segment; technology China, Europe and India leader in cGPF platforms in China and Europe Significant value uplift especially in gasoline catalysts Umicore well positioned to Increasing share of gasoline capture growth in HDD segments platforms in the global mix Umicore expanding capacity in Increasing uptake of fuel cell fuel cells drivetrains
9 Unique position in Rechargeable Battery Energy & Surface Materials for xEV Technologies
Electrification confirmed as main avenue to drastically reduce vehicle emissions in mid- and Umicore uniquely positioned to address long-term long-term requirements of this industry, while managing short-term fluctuations Strongly supported by legislation and evidenced with agility by massive roll-out of car OEM’s e-mobility strategies Full spectrum of highest quality cathode materials Increasing electrification drives strong market demand in mid and long-term Process technology and ability to scale up fast Technology roadmap offers ample room for Innovation pipeline spanning next innovation and differentiation 20 years Product Integrated supply chain and battery Process recycling Closed loop offering
10 Unique position in Recycling RECYCLING
Metallurgical leadership and proprietary technologies for Increasing resource scarcity and need for closing the treating complex residues and by- loop products Growing complexity of materials to recycle Closing the loop Increased availability of complex materials, in particular in product businesses by end-of-life materials offering recycling services Eco-efficient recycling processes are becoming the norm Over 200 different input streams
Umicore uniquely positioned to capture growth as the Recovery of more than 20 different metals world’s largest and most complex precious metal recycler with world class environmental and quality standards
11 Solid framework for value creation
Focus on Strong Focus on cashflows and growth returns solid capital structure
• Multiple growth drivers • Earnings growth objective • Prioritize cash for strategic • Secular trends • Group and segment organic growth projects • Supporting legislation returns > cost of capital • Currently in accelerated investment phase • Privilege organic growth • 15%+ ROCE target • Strong self-funding capacity • Complementary M&A, with • Value creation precedes ROCE maximization (normalized excl. current focus on value creation acceleration) • Cash return to shareholders
12 Strong funding base
35,2% 35,0% 31,1% 24,4% 13,8% 1,92 1500 1,76 1400 1,9 1300 1,40
Stable net financial debt of € 1,414 m, 1200 1,19 1,4 1100 slightly below the level of end 2019 1000 Gearing ratio 900 0,9 800 0,56 1443 700 1414 600 0,4 Net debt 500 / Adj. EBITDA Corresponds to robust credit ratios : 400 840 861 300 -0,1 200 • Net debt / Adjusted EBITDA ratio of 296 Consolidated net 100 financial debt, end of 0 -0,6
1.76x period
2017 2018 2019 2020 • Net gearing ratio of 35% 2016
million € Long-Term Fixed Rate Debt Maturity Profile Further diversification of LT funding 500 base : 400 • € 125 m 8-year EIB loan 300 200 • € 500 m 5-year convertible bond 100 0 2023 2024 2025 2026 2027 2028 2029 2030 2031
Umicore FY 2020 performance 13 Business Group Overview Catalysis Catalysis
A world leader in emission control catalysts for light-duty and Automotive heavy-duty vehicles and for all fuel types. Complemented by Catalysts smaller stationary catalyst applications (marine, power generation, …).
Precious Develops and produces metal-based catalysts used in chemistry, Metals life sciences and pharmaceutical applications. Also has a Chemistry complete portfolio of catalyst technologies for fuel cells.
15 Automotive Catalysts: business model
We develop technologies which allow our customers to meet automotive emission legislation at the lowest Total Cost of Ownership
Complete catalyst systems Customer to reduce exhaust focus gas emissions
People Operational engagement excellence
Global manufacturing & technical footprint
16 Automotive Catalysts Production Footprint 17 plants in 14 countries, 9 R&D / tech. centers in 7 countries
Frederikssund Karlskoga Lyngby Nowa Ruda Songdo Denmark Sweden Denmark Poland Korea
Onsan Burlington Hanau Korea Canada Germany Tokoname Auburn Hills, MI Florange Japan USA France Kobe Japan Rheinfelden/
Bad Säckingen Himeji Germany Japan Houston, TX USA Tianjin China
Americana Suzhou Brazil China (2)
Production plant R&D/Tech. center Joinville Port Elizabeth Pune Rayong Production plant/R&D Tech. center Stationary Brazil South Africa India Thailand
17 Catalysis – major milestones in 2020
Sustained investments Ramp-up of new plant in product and for fuel cell catalysts process innovation in Korea
Capacity expansions Rationalization of to support growth of production footprint and Automotive Catalysts in savings in LDV and HDD in China manufacturing and SG&A costs
18 COVID-19 outbreak: significant impact on automotive industry
FY 2020 YoY evolution of passenger car production across all powertrains (source: IHS & Umicore - 31/12/2020)
China Europe North America Global market
21% 16% 20% 12% 9% 6% 5% 3% 3% 3% 5% 3% 1% 6% 3% 3% 1% 3%
-1% -2% -2% -2% -4% -6% -5% -7%-5% -9% -8% -10% -12% -16% -18% -20% -21% -22% -27% -31% -34% -39% -47% -51% -62% -64%
-84% -88% -93%
-5% YoY -22% YoY -99% -20% YoY -18% YoY
Jul
Jul
Jan
Jul
Jun
Jul
Oct
Apr
Feb Sep
Apr Oct
Dec
Jan Jun
Aug Apr Oct
Nov
Jan Jun
Mar
Feb
Apr Oct
Mar
Aug Sep Nov Dec
Jan Jun
Feb Mar
Nov Dec
Aug Sep
May
May
Mar
Feb
Aug Sep Nov Dec
May May
H1: shut down of car OEM’s assembly lines and dealerships in key regions as a result of government imposed lock-downs H2: pick-up in global car demand, albeit with discrepancies between regions in terms of timing, speed and intensity of the recovery
19 Catalysis FY 2020 performance Revenues -7% and Adj. EBIT -17%; reflecting severe impact from the pandemic in H1
REVENUES
1.500 1.360 1.460 1.364 1.253 1.163 Automotive Catalysts 1.200 743 652 794 Revenue decline much lower than global car market 900 565 620 contraction 600 Disproportionate benefit from market recovery in H2 300 598 633 709 717 571 H1 Outperformed LDV market in China and Europe 0
H2
2017 2018 2019 2020 Higher sales of catalysts for HDD applications 2016 Adjusted EBIT Cost savings (footprint adjustments + operational excellence initiatives) 200 185 166 168 152 154 150 82 99 75 85 Precious Metals Chemistry 100 Revenues down due to COVID-19 impact on 132 50 automotive industry 78 81 86 87
21
2017 2018 2019 2020 Continued strong demand for fuel cell catalysts 0 2016
million € 20 Impressions
Bad-Säckingen plant AC, Germany Catalyst elements Test bench
Nowa Ruda plant AC, Poland Canned catalyst Installation stationary DNox catalyst 21 Business Group Overview Energy & Surface Technologies Energy & Surface Technologies
Rechargeable A leading cathode material supplier for lithium-ion rechargeable Battery batteries used in electrified vehicles and portable electronics. Materials
Cobalt & Refines and recycles cobalt and nickel; produces cobalt and Specialty nickel specialty chemicals for a wide range of applications (incl. Materials tires, catalysts, surface treatment). Also includes battery recycling.
Supplies precious metal electrolytes & processes for technical, Electroplating functional and decorative applications.
Electro-Optic Supplier of products for thermal imaging as well as wafers for space solar cells and high brightness LEDs, chemicals for fiber Materials optics and thin film applications.
23 Rechargeable Battery Materials: business model
Product innovation Process innovation based on strong fuels productivity application know-how improvements while maintaining highest quality standards (stringent Established industrial automotive standards) footprint close to the customer Integrated process flows Strong industrialization with guaranteed access capabilities building on to critical raw materials historical Umicore key allows an agile market competences approach
24 It takes a lot to play in the automotive league
Car OEMs need :
High quality cathode materials excellent product quality on 20+ specs • … custom made for different types of xEVs wide spectrum of cathode material technologies • … in massive volumes industrial capabilities • … at the highest speed and flexibility ability to scale up fast • … at a competitive price cost-efficient processes • …without any sustainability image risk. ethically sourced materials
It takes product technology, process technology and supply
25 Product, process and supply Key success factors
3 Supply 1 Product Technology 2 Process Technology
Raw Industrial Lab scale Pilot scale materials scale
• Ability to scale up fast • Feed flexibility Wide spectrum of cathode • Cost-efficient processes • Battery recycling material technologies • Industrial capabilities
Best in class product quality on 20+ specs: continuous fine-tuning at lab, pilot and industrial scale
26 1 Cathode material specs to fulfil cell
Product technology performance specs
Cathode material Cathode material product specs performance specs
• Particle size • Packing • Capacity • Safety • Morphology density • Power • Charge • Composition • Porosity (charge/discharge) efficiency • Purity • Consistency • Cycle life • and more… • and more…
Tailoring cathode Fundamental chemistry know- Ability to further enhance the material characteristics how to design the right product product designs during the to the cell specs composition during lab phase qualification cycles in pilot phase requires:
27 2 Rechargeable Battery Materials
Process technology Expansion projects timeline 2016 2017 2018 2019 2020 2021 2022 2023 Year
EUR 160 million announced April 2016 Brownfield in China Greenfield in Korea Completed on accelerated schedule Significant scale effects that EUR 300 million benefitted 2018 margins announced May 2017
Greenfield in China and Poland Competence Center in Belgium
EUR 660 million Significant upfront costs in 2019-2021. announced Feb 2018 Commissioning of competence center in 2019. China greenfield: ramp up of new capacity adjusted to pace of demand. Poland greenfield plant under construction, commissioning end of H1 21 and start of commercial production in Q4 21. 28 3 Access to raw materials
Supply Unique integration in the value chain
Raw material Metal Product Application End use
Umicore Flexibility in supply feed, high speed to market and responsiveness to customer needs
29 3 Access to raw materials
Supply Battery recycling as critical additional source of supply
• Umicore is fully aligned with OECD Due Diligence for Responsible Supply Chains of Minerals from Conflict-Affected and High-Risk Areas • Certified clean and ethical supply to our customers • Urban mining indispensable for global electrification of transportation • Proven industrial capabilities for all types and formats of Li-ion batteries • Patented recycling technology • High recovery rates for lithium, cobalt, nickel and copper • Highest environmental standards Umicore Flexibility in supply feed, high speed to market and responsiveness to customer needs
30 E&ST – major milestones in 2020
Push towards electrification Progress with strategic Step-up in R&D Capacity expansions stronger than ever expansion in Europe expenditures Ongoing construction greenfield EU: ambition of zero-emission Higher R&D expenditures plant in Poland Ongoing construction of greenfield mobility and commitment to plant in Poland, despite incurred reflecting the higher spend on new increasingly stringent CO2 delay of 6 month as a result of product and process technologies emission targets COVID-19 lock-down measures in battery materials China: extension of NEV subsidy imposed by governments plan extended and higher NEV penetration rate (20% by 2025, 50% by 2035)
31 EV battery demand evolution
Evolution global EV LDV battery demand (GWh)
Global market 140 120% Global EV battery market in 2020 up 17% to
137 137 GWh, driven by Europe
120 100%
100%
100 Regional differences in demand patterns: 79% 80%
80 Little year-on-year growth in China, well
60% 60%
60 below industry anticipations
40% 40 More than doubling of demand in 23% 20% Europe driven by CO2 Directive 20 17%
0 0% Contrasting evolution in China with demand 2015 2016 2017 2018 2019 2020
Global (LDV in Gwh) dropping in H1 2020 and some recovery Global YoY LDV GWh growth (%) starting at year-end 2020
Source: EV Volumes, Umicore 32 E&ST FY 2020 performance Revenues -15%; Adj. EBIT -59%; severe COVID-19 impact and significant negative operating leverage
REVENUES Rechargeable Battery Materials Lower cathode materials revenues: higher NMC volumes for 1.500 1.289 1.225 EVs; lower LCO and ESS volumes 1.250 1.045 1.000 894 Pricing pressure, underutilized capacity in China 639 618 750 610 488 Higher fixed costs related to expansions 495 500 322 250 650 607 557 288 398
Cobalt & Specialty Materials 0 H1
2017 2018 2019 2020 Lower revenues reflecting impact of COVID-19 2016 H2 Lower contribution from refining & recycling activities; reduced Adjusted EBIT demand for cobalt and nickel chemicals 300 257 250 recorded slightly higher revenues; revenues Electroplating 200 183 141 136 in Electro-Optic Materials decreased 150 81 100 82 79 75 50 45 121 102 21 37 61 54
0
2016 2017 2018 2019 2020
million €
33 Impressions
EV car battery pack
Packaging finished product RBM Cheonan production sites, Korea 34 Business Group Overview Recycling Recycling
Operates the world’s most sophisticated precious metals recycling facility Precious Metals and recovers 17 precious and other valuable metals from complex waste Refining streams.
Precious Metals Services for hedging, leasing, purchasing and sale of precious and Management platinum group metals to internal and external customers
Supplier of precious metals based products for jewelry and industrial Jewelry & applications, recycler of jewellery and production scrap and producer of Industrial Metals platinum-based equipment for the glass and chemical industries.
36 Precious Metal Refining
Largest and most complex precious metals recycling operation in the world Leading refiner of 17 different metals
Processes more than 200 different types of raw materials World class environmental and quality standards
37 The value chain of metals
Ores & Refined New concentrates metals products
Smelters Industry Consumers Mines & refiners
Complex mining Smelting Complex Complex concentrates & refining production end-of-life & residues residues scrap materials
Industrial by-products End-of life materials
3838 Revenue Drivers
Main revenue drivers
Treatment & refining Metal yield charges
Treatment charges are Umicore assumes the risk determined, among other of recovery above or criteria, by the complexity under the contractually of the materials agreed recovery rate
39 Metal price exposure
Managing the effects of metal price movements Direct: Indirect: on earnings
through metal through raw Systematic hedging of yield material availability transactional exposure
Depending on market conditions hedging of (part of) structural metal price exposure through contractual arrangements
Impact on working capital is mitigated by toll-refining – metals remain property of the supplier during treatment
40 Umicore has unique technology
Umicore is unique due to its proprietary complex flowsheet that combines three metallurgical streams
This enables
Ability to optimize Flexibility to treat Recovery & Scope to broaden feed and a broad range of valorization of the to new types of therefore input materials most metals materials in future profitability
• Umicore technology guarantees environmentally friendly processing, a high yield and a more competitive cost • Umicore introduced its unique Ultra High Temperature technology for Battery Recycling more than 5 years ago
4141 Recycling – major milestones in 2020
Leveraging unique Launch of multi-year Continued investments recycling technology investment plan to to sustain and improve to treat high complex, further improve the environmental PGM rich, materials robustness of the performance of the Hoboken operations plant
42 Recycling FY 2020 performance
An exceptional metal price environment, in particular for rhodium
Rhodium (EUR/kg) Palladium (EUR/kg) Gold (EUR/kg) 500.000 100.000 100.000 Historically high and volatile 450.000 +148% 90.000 +12% 90.000 +33% precious and PGM price levels in 400.000 Dec. 2019/2020* 80.000 Dec. 2019/2020* 80.000 Dec. 2019/2020* 2020, in particular for rhodium.
350.000 70.000 70.000 Rhodium price surged in H2 20 in a
300.000 60.000 60.000 context of tight supply and high
250.000 50.000 50.000 demand from the car industry as a result of increasingly stringent 200.000 40.000 40.000 emission norms. 150.000 30.000 30.000 Current prices for precious and 100.000 20.000 20.000 PGM metals already well above the 50.000 10.000 10.000 average received prices in 2020.
0 0 0
Jul Jul Jul Jul Jul Jul Jul Jul Jul
Oct Oct Oct Oct Oct Oct Oct Oct Oct
Apr Apr Apr Apr Apr Apr Apr Apr Apr
Jan Jan Jan Jan Jan Jan Jan Jan Jan 2018 2019 2020 2018 2019 2020 2018 2019 2020
Source: Umicore *Comparison of average metal rates December 2019 vs December 2020 43 Recycling FY 2020 performance Revenues +23%; Adj. EBIT +92%; higher metal prices and to a lesser extent favorable trading conditions and supply mix
REVENUES
1.000 836 Precious Metals Recycling 681 750 641 650 626 396 Higher metal prices, particularly for PGMs 500 318 311 300 368 Supportive supply environment 250 440 323 339 327 313 Supportive trading conditions 0 H1
Higher processed volumes (vs. extended maintenance
2017 2018 2019 2020 in ‘19) 2016 H2 Adjusted EBIT
Increased Jewelry & Industrial Metals revenues Substantial increase in earnings contribution from 400 362
Precious Metals Management 300 171 188 200 125 128 135 112 100 63 55 56 191 62 73 79 76
0
2016 2017 2018 2019 2020
million €
44 Impressions
PMR Hoboken recycling plant, Belgium 45 FY 2020 financial review Key figures FY 2020
REVENUES Adjusted EBIT Free Operating Cash Flow € 167 m (- € 39 m in 2019) € 3.2 bn € 536 m Net debt at € 1,414 m -4% YoY +5% YoY Net debt / LTM Adj. EBITDA 1.76x
Adjusted NET PROFIT Adjusted EBITDA CAPEX € 403 m (Group share) € 322 m € 804 m Adjusted EPS € 1.34 Proposed gross annual dividend of +7% YoY € 0.75 per share ROCE 12.1%
Record earnings in unprecedented conditions
Note: All references to revenues in this document refer to revenues excluding metals (all revenue elements – value of purchased metals)
47 Record Adj. EBIT(DA) and margins
Adj. EBIT & Adj. EBIT margin Record adj. EBIT (€ 536 m) and record adj. EBIT margin 16,3% 800 15,5% Stellar adj. EBIT growth in Recycling more than offset 14,8% 16,0% 13,2% 12,6% 14,0% decreases in Catalysis and E&ST. 600 513 536 509 12,0%
398 10,0% Includes € 24 m higher D&A charges year on year from
400 293 8,0% 320 252 269 recent investments and acquisition. 203 6,0% 165 200 4,0% Strong rebound in Catalysis with 2H adj. EBIT, up 34 %
261 240 243 2,0% 155 195 year on year. 0 0,0%
Record adj. EBIT margin driven by higher metal margin
2017 2018 2019 2020 2016 in Recycling. Adj. EBITDA & Adj. EBITDA margin
1200 24,6% 25,0% Record adj. EBITDA (€ 804 m) and record adj. 21,9% 22,1% 19,9% 20,0% EBITDA margin 1000 20,0% 805 800 720 753 Strong operating cash flow with highest adjusted EBITDA 587 15,0% 600 496 356 396 429 contribution in history. 299 10,0% 400 258 Adj. EBITDA up 7 % year on year vs + 5 % for adj. EBIT. 5,0% 200 364 357 376 238 288 Adj EBITDA margins more resilient across business 0 0,0% 2016 2017 2018 2019 2020 groups than adj. EBIT.
Group, excluding discontinued activities, million € 48 Pronounced operating leverage effects 1H 2020 FY 2020
2H 2020
Group (YoY delta in %)
1H 2020 2H 2020 FY 2020 Revenues -4% -3% -4% Adj. EBITDA +5% +8% +7% Adj. EBIT +1% +9% +5%
49 Increase in free operating cash flows
million €, continued operations only
1000 800 627 707 Cash flow from operations before changes in 489 603 500 436 444 549 working capital up 13 % at € 707 m 431 213 323 13 92 0 Increase in cash working capital of € 104 m -113 -78 -104 mostly driven by higher PGM prices -276 -500 Cash working capital increase mostly in Catalysis -708 (Recycling to a lesser extent); decrease in E&ST -1000 FY15 FY16 FY17 FY18 FY19 FY20 Cashflow generated from operations after net working capital cash flow Cash flow from operations after working capital Net working capital cash flows up 10 % at € 603 m Cashflow from operations before net working capital cash flow
million €, continued operations only
800 549 603 600 444 Free cash flow from operations up from - € 39 323 400 213 156 92 168 m in 2019 to € 168 m 200 98 0 -164 -200 Highest amount in recent years -406 -39 -400 -225 -288 -600 -377 -435 -498 Selective capex spending in view of market -800 -588 FY15 FY16 FY17 FY18 FY19 FY20 context (€ 403 m vs € 553 m in 2019)
Cashflow generated from operations after net working capital cash flow Capex + capitalized development expenses Free cashflow from operations
50 *Free cashflow from operations = cashflow generated from operations – capex & capitalized development expenses Net cash flow bridge
million € 650 Free operating cashflow of 600 € 168 million resulting in a 550 € 29 million decrease in 500 reported net debt 450 400 350 435 603 € 44 million portion of 300 convertible bond accounted for 250 as equity 200 150 79 100 Dividend cash out of € 60 m 168 50 56 12 29 limited to interim dividend 0 60 44 payout in H2 20 -50
Cashflow Capex & Free Taxes Net interest Dividends Conversion Other (FX, Decrease in from capitalized Operating paid paid paid to right of own shares, reported net operations development Cashflow Umicore convertible lease financial debt expenses shareholders bond liability…) recognized in equity
51 Outlook 2021 outlook
Umicore expects to achieve substantial growth in earnings in 2021, with growth in all business Groups
Given the current limited visibility, this outlook statement is made under the assumption that the ongoing COVID-19 outbreak would not result in additional material or protracted disruptions to the economy or Umicore’s operations
CATALYSIS ENERGY & SURFACE RECYCLING TECHNOLOGIES
Substantial growth in sales volumes of Favorable metal prices Further benefit from leading edge cathode materials for EVs technology offering in gasoline Supportive supply mix and applications for LDV in China and Persisting Chinese overcapacity and moderate volume growth in Europe pricing pressure Precious Metals Refining Initial impact of China VI legislation Some € 50m increase in fixed costs in If current elevated metal price for HDD applications Rechargeable Battery Materials levels were to prevail throughout the year, Adj. EBIT would increase Savings from footprint adjustments Volume growth to result in meaningful very significantly vs 2020 and cost improvements carried out Adj. EBIT growth, in line with current 1 in 2020 market consensus
1 Umicore has engaged Vara Research GmbH to survey brokerage analysts to provide analysts' consensus estimates to the market. The most recent consensus is available on https://vara-services.com/umicore/ Umicore FY 2020 performance 53 Long-term growth drivers remain intact
COVID-19 stimuli plans aimed at a ‘green recovery’ in China and Europe China: Extension of NEV subsidy plan from 2020 until end 2022 and confirmation of increased mandatory NEV credit targets for 2021-2023 ENERGY & SURFACE TECHNOLOGIES Europe: EU recovery plan predicated on European Green deal, including ambition towards zero-emission mobility. Stimuli packages in several countries (Germany, France, Spain) with subsidies for electrified vehicles
Tightening emission norms continue to be on the agenda in key regions, confirming the need for more complex automotive catalyst technologies CATALYSIS going forward
Resource scarcity and complexity of materials
RECYCLING Path towards a more circular economy
54 Key Investment Considerations Key investment considerations
• Record earnings in 2020 despite challenging market context due to COVID-19, demonstrating the merits of the strategy building on complementary activities
• Well positioned to take advantage of accelerating global megatrends : more stringent emission control, electrification of the automobile and resource scarcity
• Global presence and unique competences acquired over many years;
• A technology leader in most key product markets and particularly in automotive catalysts, cathode materials and complex polymetallic recycling;
• Strong organic growth prospects supported by legislation
• Well-diversified business profile with broad product, end-market and customer base driven by a common theme of sustainability
• Strong track record of and commitment to innovation to maintain competitive lead (R&D spending of ~7% of revenues in 2020)
• Robust financial performance across cycles; focus on margin and returns;
• Strong balance sheet with recent substantial growth investments
• Experienced board, management team, and clear governance principles
56 Forward-looking statements
This presentation contains forward- Should one or more of these risks, looking information that involves risks uncertainties or contingencies materialize, and uncertainties, including statements or should any underlying assumptions about Umicore’s plans, objectives, prove incorrect, actual results could vary expectations and intentions. materially from those anticipated, expected, estimated or projected. Readers are cautioned that forward- looking statements include known and As a result, neither Umicore nor unknown risks and are subject to any other person assumes any significant business, economic and responsibility for the accuracy of these competitive uncertainties and forward-looking statements. contingencies, many of which are beyond the control of Umicore.
57