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FIRST 9 MONTHS OF 2021 RESULTS

11/04/2021 | 04:03pm

RESULTS PRESENTATION | 9M 2021

1 HIGHLIGHTS

CONSOLIDATED NET PROFIT INCREASES 68% IN THE FIRST 9 MONTHS OF 2021

SEMAPA GROUP INVESTS 82 MILLION EUROS. REDUCTION IN CONSOLIDATED NET DEBT BY 138 MILLION EUROS COMPARED TO THE END OF 2020

  • After the new waves of Covid-19 infections in the 1st quarter, which forced governments in the Group's key markets to take lockdown measures, the economies gradually opened up in the 2nd quarter, and remained open in the 3rd quarter, with an impact mainly on the Pulp and Paper segment.
  • The consolidated revenue of Semapa Group in the first nine months of 2021 was 1,515.3 million euros (+4.7% year- on-year), 1,119.6 million euros generated in Pulp and Paper / Navigator (+7.3%), 366.7 million euros in Cement / Secil (-3.5%), and 29.1 million euros in Environment / ETSA (+24.4%). Exports and foreign sales for the same period amounted to 1,108.9 million euros, accounting for 73.2% of revenue.
  • Navigator's revenue reflects the increase in paper volumes in a context of price recovery, although the average in the period is still slightly below the average price in 2020 (-0.5%). In this period, there was an increase in pulp prices while the sales volume decreased, conditioned by less availability of pulp for the market (-47% compared to the same quarter last year) due to higher integration in paper. In the Cement segment, revenue essentially reflects the negative developments in the Lebanese market, an effect of the strong depreciation of the Lebanese pound against the Euro, which more than outweighed the effect of the positive developments in the Portuguese, Tunisian, and Brazilian markets.
  • EBITDA in the first nine months of 2021 totalled 364.8 million euros (+38.7 million euros year on year). Pulp and paper generated 246.0 million euros (+16.9%), Cement generated 107.3 million euros (-0.1%) and Environment generated 11.5 million euros (+47.4%). Secil's EBITDA remained stable when compared to the same period of the previous year, despite the year 2020 being positively impacted by capital gains generated from asset sales (around 7 million euros). Without this effect, Secil's EBITDA would have grown by 6.2%. In the first nine months of 2021 consolidated EBITDA margin was 24.1% (vs. 22.5% in 2020).
  • Net profit attributable to Semapa shareholders at the end of the first nine months of 2021 stood at 122.2 million euros (vs. 72.8 million euros in the same period in 2020). This growth resulted from a favourable evolution of EBITDA (+38.7 million euros) combined with better financial results (+20.9 million euros) stemming from the lower negative exchange rate effects in Secil (Brazilian real), a reduction in depreciation, amortization and impairment losses and provisions (+24.5 million euros) and negatively influenced by the tax function (-21.5 million euros).
  • Investments in the first nine months of the year amounted to 82 million euros, which includes 13.8 million euros relating to the Research, Development and Technology (RD&T) project, and decarbonisation at the Outão cement plant, in Portugal. The CCL Project - Clean Cement Line, includes several subprojects whose main objectives are to develop and demonstrate on an industrial scale a new cement production technology, reduce the plant's CO2 emissions by at least 20%, increase energy efficiency by 20% and generate 30% of electricity through an innovative hybrid generation system, through process heat recovery and concentrated solar thermal energy. This project is simultaneously Project PIN - Project of National Interest, and is to date the largest RD&T project in the Portugal 2020 programme. It is estimated that the total investment will amount to 86 million euros and will be completed by 2023.
  • In the first nine months of the year, consolidated Net Debt totalled 1,077.2 million euros, 138 million euro less compared to the end of 2020. On 30 September 2021, total consolidated cash and cash equivalents amounted to 323.6 million euros, in addition to 591.1 million euros in committed and undrawn credit lines, thus ensuring strong liquidity in the current context of uncertainty.

1

LEADING BUSINESS INDICATORS

IFRS - accrued amounts

9M 2021

9M 2020

Var.

Q3 2021

Q3 2020

Var.

(million euros)

Revenue

1,515.3

1,447.0

4.7%

543.9

505.2

7.7%

EBITDA

364.8

326.1

11.9%

140.0

122.8

14.1%

EBITDA margin (%)

24.1%

22.5%

1.5 p.p.

25.7%

24.3%

1.4 p.p.

Depreciation, amortisation and impairment

(140.5)

(166.1)

15.4%

(47.1)

(54.3)

13.3%

losses

Provisions

(2.1)

(1.0)

-112.7%

0.2

3.0

-95.0%

EBIT

222.2

159.0

39.8%

93.1

71.5

30.2%

EBIT margin (%)

14.7%

11.0%

3.7 p.p.

17.1%

14.1%

3.0 p.p.

Net financial results

(36.2)

(57.1)

36.6%

(12.2)

(13.7)

11.0%

Net monetary position

(0.2)

-

-

(0.0)

-

-

Profit before taxes

185.8

101.9

82.3%

80.8

57.7

40.0%

Income taxes

(32.5)

(11.0)

-194.7%

(17.8)

(6.1)

-189.8%

Net profit for the period

153.3

90.9

68.7%

63.0

51.6

22.2%

Attributable to Semapa shareholders

122.2

72.8

68.0%

49.1

42.5

15.7%

Attributable to non-controlling interests (NCI)

31.0

18.1

71.6%

13.9

9.1

52.5%

Cash flow

295.8

257.9

14.7%

110.0

102.9

6.9%

Free Cash Flow

215.8

250.6

-13.9%

60.8

104.4

-41.7%

30/09/2021

31/12/2020

Sep21 vs.

Var.

Dec20

Equity (before NCI)

1,019.7

948.8

7.5%

Interest-bearing net debt

1,077.2

1,215.5

-11.4%

Lease liabilities (IFRS 16)

91.9

80.3

14.4%

Total

1,169.1

1,295.9

-9.8%

SUMMARY TABLE OF OPERATING INDICATORS

Unit

9M 2021

9M 2020

Var.

Q3 2021

Q3 2020

Var.

Pulp and Paper

BEKP Sales (pulp)

1 000 t

207

297

-30.4%

55

104

-47.5%

UWF Sales (paper)

1 000 t

1,081

934

15.7%

380

336

12.9%

Total sales of tissue

1 000 t

77.8

79.2

-1.8%

26.0

27.3

-4.8%

Cement

Sales of Grey cement

1 000 t

3,925

3,959

-0.9%

1,304

1,537

-15.2%

Sales of Ready-mix

1 000 m3

1,463

1,357

7.9%

524

480

9.3%

Environment

Collection of raw materials - Animal waste

1 000 t

92.1

89.8

2.6%

32.2

30.5

5.4%

(categories 1, 2 and 3)

RESULTS PRESENTATION | 9M 2021

2

2 PERFORMANCE OF THE SEMAPA GROUP BUSINESS AREAS

2.1. BREAKDOWN BY BUSINESS SEGMENTS

IFRS - accrued amounts

Pulp and Paper

Cement

Environment

Holdings

Consoli

(million euros)

dated

9M 2021

21/20

9M 2021

21/20

9M 2021

21/20

9M 2021

21/20

9M 2021

Revenue - External

1,119.6

7.3%

366.7

-3.5%

29.1

24.4%

-

-

1,515.3

Revenue

1,119.7

7.3%

366.9

-3.4%

29.1

24.4%

(0.3)

3.4%

1,515.3

EBITDA

246.0

16.9%

107.3

-0.1%

11.5

47.4%

0.0

-95.1%

364.8

EBITDA margin (%)

22.0%

1.8 p.p.

29.2%

1.0 p.p.

39.6%

6.2 p.p.

0.0 p.p.

24.1%

Depreciation, amortisation and

(100.8)

17.9%

(37.0)

8.9%

(2.4)

-2.8%

(0.2)

34.1%

(140.5)

impairment losses

Provisions

0.1

-69.7%

(2.2)

-53.4%

-

-

-

-

(2.1)

EBIT

145.3

64.9%

68.0

4.2%

9.1

66.5%

(0.2)

-210.5%

222.2

EBIT margin (%)

13.0%

4.5 p.p.

18.5%

1.4 p.p.

31.3%

7.9 p.p.

0.0 p.p.

14.7%

Net financial results

(12.7)

-40.6%

(19.2)

51.8%

(0.1)

24.2%

(4.2)

48.4%

(36.2)

Net monetary position

-

(0.2)

-

-

(0.2)

Profit before taxes

132.6

67.7%

48.6

90.7%

9.0

69.7%

(4.3)

45.4%

185.8

Income taxes

(26.6)

-119.8%

(7.2)

-16.1%

(2.0)

-62.1%

3.3

-61.2%

(32.5)

Net profit for the period

106.0

58.2%

41.4

114.7%

7.0

72.0%

(1.0)

-285.4%

153.3

Attributable to Semapa

74.1

58.2%

42.2

98.0%

7.0

72.0%

(1.0)

-285.4%

122.2

shareholders

Attributable to non-

31.8

58.2%

(0.8)

61.2%

0.0

72.9%

-

-

31.0

controlling interests (NCI)

Cash flow

206.6

9.2%

80.7

31.4%

9.4

46.6%

(0.9)

-201.0%

295.8

Free Cash Flow

182.7

7.2%

42.7

-50.6%

3.8

-23.2%

(13.4)

-18.8%

215.8

Interest-bearing net debt

596.9

277.1

(3.3)

206.6

1,077.2

Lease liabilities (IFRS 16)

52.2

37.9

1.6

0.3

91.9

Total

649.1

314.9

(1.7)

206.8

1,169.1

Notes:

For the purpose of calculating the change in net debt the values of 31.12.2020 are used.

Figures for business segment indicators may differ from those presented individually by each Group, as a result of consolidation adjustments.

The Navigator Company ("Navigator") released its results on 28 October 2021, so only the highlights of that report will be presented herein. Secil and ETSA, which are not listed, did not publish their results. Therefore, their operations are described in more detail.

RESULTS PRESENTATION | 9M 2021

3

2.2. PAPER AND PULP BUSINESS AREA

totalconsolidated of% Revenue 9M 2021

74%

% of consolidated total

EBITDA 9M

2021

67%

HIGHLIGHTS IN 2021 (VS. 2020)

REVENUE

In the first nine months of 2021, revenue increased by

1,043.9

1,119.7

7.3% to 1,119.7 million euros, with paper volumes

increasing in a context of price recovery, although the

average for the period is still slightly below the

average price in 2020 (-0.5%).

Million Euros

9M 2020

7.3%

9M 2021

REVENUE BREAKDOWN BY SEGMENT

95.5

-8.8

1,119.7

106.2

112.7

Million Euros

814.0

Δ% 21/20

+14.6%

-4.1%

-0.9%

-10.6%

-464%

+7.3%

UWF Paper

BEKP Pulp

Tissue

Energy

Others and

9M 2021

9M

eliminations

710.0

117.5

107.2

106.8

2.4

1,043.9

2020

Note: 2020 data was reclassified for the purpose of comparability.

RESULTS PRESENTATION | 9M 2021

4

This is an excerpt of the original content. To continue reading it, access the original document here.

Disclaimer

Semapa - Sociedade de Investimento e Gestão SGPS SA published this content on 04 November 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 04 November 2021 20:58:09 UTC.

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