Investors Presentation - October 2021 Dr Stephan Meeder, CEO/CFO Heike Baumbach, Head of Investor Relations - CropEnergies AG
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Investors Presentation
October 2021
Dr Stephan Meeder, CEO/CFO
Heike Baumbach, Head of Investor Relations
EU: European Green Deal European Parliament gave green light to first-ever EU climate law on 24 June 2021 • Interim target: Reduction of GHG emissions of at least 55% by 2030 (on 1990 levels) • Climate-neutrality by 2050 “Fit for 55” legislative package • Proposals to make the EU's climate, energy, land use, transport and taxation policies fit for reducing net greenhouse gas emissions by at least 55% by 2030, compared to 1990 levels Revision of various regulations and directives planned, i.e. • Emissions Trading System (ETS) • Effort Sharing Regulation (ESR) • Revision of the Energy Tax Directive (ETD) • Amendment to the Renewable Energy Directive (RED II) October 2021
Renewable Ethanol As fuel • Produced from local, renewable raw materials • High-quality fuel for petrol engines • Ensures that fossil carbons remain in the ground permanently and do not continue to drive climate change • Less greenhouse gas emissions, nitrogen oxides & particulate matter emissions compared to fossil fuels • CropEnergies ethanol reduces CO2 emissions by an average of more than 70% compared to fossil fuel. October 2021
Ethanol
>70% less GHG emissions compared to fossil fuels*
• The GHG values of all elements in the value-added chain are added up
• The emissions from ethanol when used in combustion engines is zero
• European ethanol reduces annual GHG emissions by >10 Mt**
Cultivation Transport Ethanol Ethanol CO2
Grain Grain Production Transport Liquefaction
*83,8 gCO2eq/MJ **Own calculations
October 2021
Range of products
Renewable Ethanol
As an additive to petrol to improve the
greenhouse gas balance
As neutral alcohol for beverages and
foods
As neutral alcohol for the processing
industry: cosmetics, pharmaceuticals,
disinfectant and technical applications
As a raw material for the chemical
High-quality, renewable industry
ethanol (alcohol)
October 2021
Range of products
Food and animal feed
ProtiGrain® & Ensus- CDS – ProtiWanze® Gluten Liquefied biogenic
DDGS liquid protein animal Protein product for the CO2
dried high-quality feed food and animal feed for food and industrial
animal feed, in form of industry applications
powder or pellets
October 2021
The ethanol markets
EU & UK production
• World production • EU & UK production
• 2021e: 122 million m3 (+3%) • 2021e: 7.7 million m3 (+3%)
o Fuel applications: 102 million m³ (+3%) o Fuel applications: 5.3 million m³ (+5%)
• 2022e: 128 million m3 (+5%) • 2022e: 8.1 million m3 (+5%)
o Fuel applications: 108 million m³ (+5%) o Fuel applications: 5.8 million m³ (+8%)
World production of ethanol [M m3] EU production of ethanol [M m3]
150 9
100 6
Source: FO Licht (2021)
Source: FO Licht (2021)
50 3
2017 2018 2019 2020 2021e 2022e 2017 2018 2019 2020 2021e 2022e
USA Brasil EU & UK other fuel non-fuel
October 2021 7
Market development (I)
Volumes
• Ethanol market in the EU27 & UK in 2021 (in million m³) EU27 & UK: ethanol sales [1,000 m3]
• Consumption: 8.6 +3% (5.7 fuel | 2.9 non-fuel) 8,599 8,560 8,951
Source: IHS Markit (2021)
,
9.000 8,317
982 965 965
955
• Production: 7.7 +3% (5.3 fuel | 2.3 non-fuel) 1,618 1,950 1,890 1,860
• 2021 only slight recovery in fuel ethanol sales expected ,
4.500
5,999 5,412 5,705 6,126
• Net imports around 0.9 million m³ foreseen in 2021 (PY 1.0 million m³)
• Outlook: Strong increase in fuel ethanol sales in 2022 0
2019 2020 2021 2022
Fuel Industrial Potable
• Premium E10 continues to be on the rise in Europe E10 shares in selected countries
Source: ePURE (2021)
100%
• E10 already established as #1 petrol in many European countries
100%
100%
98%
95%
95%
95%
90%
80%
• Launch in Sweden and UK in August and September, respectively
72%
70%
50%
16%
47%
45%
0%
October 2021 8
Market development (II)
Prices and feedstock market
European ethanol prices [€/m3]
850
• European ethanol price* on the rise
• Due to increased mobility in many countries
o But also reflects higher global energy and grain prices 600
• Average ethanol price € 656 (665) /m³ in Q2
FY 19/20 FY 20/21 FY 21/22
350
• Feedstock market 2021/22
• Grain prices**: € 221 (183) /t in Q2
• EU grain harvest: 291 Mt (+4%) exceeds consumption of 263 Mt Euronext Paris Wheat [€/t]
280
• World grain harvest***: 2.283 Mt (+3%) with slightly lower stocks (589 Mt)
• Still high price level despite promising harvest estimations
200
FY 19/20 FY 20/21 FY 21/22
120
* T2 FOB Rdam ** Wheat (Euronext), next expiry *** all types, without rice
October 2021 9
Market development (III)
Energy markets
Natural Gas FR [€/MWh]
100
FY 19/20 FY 20/21 FY 21/22
• National gas prices severely increased in Europe
• Low storage levels due to long and cold winter 2021
• LNG exports from the US rather heading to Japan/Corea 50
• Supply of LNG from Russia to the European market decreased
• Low renewable power generation esp. in UK shifts gas volumes to
electricity generation 0
• Start of supply by new North Stream 2 pipeline remains unclear
• Price development in winter season will be weather-driven
Natural Gas UK [€/MWh]
120
FY 19/20 FY 20/21 FY 21/22
60
0
October 2021 10State of EU energy and transport policies Before Fit for 55 October 2021 11
Renewable Energy Directive-II
The “toolbox“
Arable crops Annex IX-A Annex IX-B Electricity
• 2020 level, max. 7% • Min. 0.2% in 2022 • Max. 1.7%, but still • Important component
• Local, sustainable • Min. 1.0 % in 2025 x2 versus today in the future
• Proteins • At least 3.5% in 2030 • UCO imports: 10x • But: discretionary
within last 10 years multiplier (x4) does not
• Commitment to 1G • Strong market save a single gram of
as reliable basis for potential • Compatibility with
CO2
low-emission law on waste needs
• Very capital intense to be ensured • Extension only
transport sector
necessary reasonable if
• Investment security additional green
and investment electricity will be
incentives decisive produced
October 2021 12State of EU energy and transport policies After Fit for 55 (proposal) October 2021 13
Vision and mission OUR VISION Our vision is a climate friendly world in which renewable resources are key to ensuring the welfare of today‘s and future generations. OUR MISSION Our mission is to be the most trusted partner for our customers delivering sustainable products made out of biomass. Our new appearance: October 2021 14
Preliminaries Q2 and Outlook 2021/22
• Outlook (published on 15 September 2021)
• High raw material and energy costs with higher ethanol
revenues
• Revenues between € 970 and 1,010 million
• EBITDA in a range of € 105 to 135 million
• Operating profit between € 65 and 90 million
• Preliminaries Q2 2021/21
• Revenues on record level at € 249.2 (228.5) million
• Operating profit below record level of previous year‘s
period at € 23.3 (42.6) million
October 2021 15CropEnergies
Innovation from Biomass
For our future:
Sustainability and climate neutrality
• in its traditional core business of mobility - with
sustainable and climate-friendly fuels
• in a completely new business area based on
ethanol derivatives as an alternative to fossil
raw materials
• with biogenic CO2 as the raw material of the
future and as capital for the company's further
development
• to serve a clear growth market with protein
products for the food and animal feed industry
and to deepen the value chain
October 2021 16Communication
Update
• E20
• Four Motors sponsoring going well
• Sponsoring ADAC 1.000 km race at Nürburgring
18 Sept – pace cars and two participants were
powered by CropEnergies‘ Super Eco 20
• Federal Minister of Economics Peter Altmaier visited
CropEnergies in Zeitz on 26 August 2021
• #umtanken (umtanken.de) went online beginning of July –
facts and figures about ethanol
October 2021 17Q1 2021/22
Overview 1st quarter 2021/22 • Ethanol production 235 (208) ,000 m³ + 13% • Revenues € 214 (171) million + 25% • EBITDA € 25.5 (18.2) million + € 7 million • Operating profit € 15.1 (8.1) million + € 7 million • Net earnings € 10.1 (7.9) million + € 2 million • Net financial assets (vs. 28.02.2021) € 182.6 (154.6) million + € 28 million Note: Figures in parentheses relate to the corresponding prior-year period. October 2021 19
Operating profit
Revenues / Production
[M€ / 1,000 m3]
400
(in € million) Q1 2021/22 Q1 2020/21 Δ
300 272
255 251
Revenues 214.1 170.7 + 25% 235
208
Overall performance 210.5 169.6 + 24% 200 229 226
208 214
Cost of materials* -163.0 -131.3 - 24% 171
100
Spread (gross) 47.5 38.3 + 24%
in % of overall performance 22.6% 22.6% - 0
Q1 Q2 Q3 Q4 Q1
Further
*without operating
restructuring expenses/income*
costs and special items -22.0 -20.1 - 10% 20/21 20/21 20/21 20/21 21/22
Operating profit [M€]
EBITDA* 25.5 18.2 + 40% 50
Margin 11.9% 10.7% - 43
40
Depreciation* -10.4 -10.1 - 3%
29 28
30
Operating profit 15.1 8.1 + 86%
*without restructuring costs and special items 20 15
• Significant increase in sales prices and quantities 10 8
• Higher specific raw material and energy costs 0
Q1 Q2 Q3 Q4 Q1
20/21 20/21 20/21 20/21 21/22
October 2021 20Net earnings
Net earnings [Mio. €]
50
(in € million) Q1 2021/22 Q1 2020/21 Δ
40
Operating profit 15.1 8.1 + 86% 32
30
Restructuring costs / special items 0.0 0.0 - 24
22
At-equity result -0.1 0.1 - 20
10
Income from operations 15.0 8.2 + 83% 10 8
Financial result -0.9 2.3 - 0
Q1 Q2 Q3 Q4 Q1
Earnings before income taxes 14.1 10.5 + 34% 20/21 20/21 20/21 20/21 21/22
Taxes on income -3.9 -2.6 - 50%
Net earnings for the period 10.1 7.9 + 28%
Earnings per share (in €) 0.12 0.09 + 28%
• Unrealised currency effects included in financial result
• EPS increased to € 0.12 (0.09)
October 2021 21Cash flow
Cash flow (+) / Investments* (-)
[M€]
50 *in PPE
(in € million) 2020/21 2019/20 Δ 40
Cash flow 21.2 15.5 + 5.7 30
Change in net working capital 12.9 18.5 - 5.6 21
20 16
Net cash flow from operating activities 34.1 34.0 + 0.1 10
Investments in property, plant et al. -4.7 -10.1 + 5.4
0
Cash received on divestments 0.0 0.0 + 0.0
-10 -5
Payments into financial receivables -18.1 -16.9 - 1.2
Q1 Q1
Payments into current financial investments 0.1 0.0 + 0.1 20/21 21/22
Net financial asset [M€]
Cash flow from investing activities -22.6 -26.9 + 4.3 250
Cash flow from financing activities -1.4 -0.9 - 0.5
200 183
Changes in exchange rates / consolidation basis 0.0 -0.1 + 0.1 165
155
150 130
Change in cash and cash equivalents 10.1 6.1 + 4.0
100 92
31/05/2021 31/05/2020 Δ
50
Net financial assets 182.6 130.2 + 52.4
0
• Significant increase in net financial assets
October 2021 22Appendix
23Climate-friendly liquid fuels will be essential
Development of car registrations and vehicles in use
New car registrations EU27 New car registrations DE Vehicles in use DE
2% 2% 2% 0.4% 1% 0.4% 0.5%
100% 1% 100% 50 Mio. 1% 1% 1%
5% 2% 7% 0.1% 0.2% 0.6%
2% 8% 12%
5% 7%
7% 0.2% 0.3% 0.6%
32% 11% 40 Mio.
32% 32% 32% 31%
75% 28% 75%
22% 28%
22% 1% 1.5%
6% 5% 30 Mio. 0.6%
12% 19% 50% 11%
50%
16%
20 Mio.
59% 66% 66% 65%
58% 25%
25% 47% 47%
42% 39% 10 Mio.
0% 0% Mio.
2019 2020 Jan-Jun 2021 2019 2020 Jan-Jul 2021 01.01.2019 01.01.2020 01.01.2021
Gasoline HEV Gasoline HEV
Gasoline HEV
Diesel BEV Diesel BEV
Diesel BEV
PHEV APV other than electric
PHEV APV other than electric PHEV APV other than electric
October 2021 24Gross electricity generation in the EU27 in
Total: 2,760 TWh
Gross electricity generation in the Development of electricity generation in the
EU27 in 2020 EU27 [TWh]
Total: 2,760 TWh 1200
38%
fossil
(others) 1000
4% 33%
800 25%
solid fossil
13% 30%
600
renewables
natural gas 38% 16% 20%
20% 400
12% 13%
200
9%
nuclear 4%
25% 0
renewables nuclear natural gas
Source: Agora (2021) solid fuels fossil (others)
Source: Agora (2021)
October 2021 25Fuel consumption in the EU27 in 2019
Total: 3,168 TWh
Fuel consumption in the EU27 (2019)
24% 20%
Gasoline
Biodiesel/
Ethanol 1% HVO*
Biodiesel Palmoil
Others 4%
20% Ethanol 60%
68% Diesel
3%
still 95% fossil only 5% renewables
*) without palm-based
fuels (estimate)
Source: Eurostat (2021)
October 2021 26Climate protection for Germany
• National implementation of RED-II
• Overall GHG quota from currently 6% to 25% in 2030
o Penalty for non-compliance increases to € 600/t CO2äq from 2022 on DE: GHG reduction quota
2020-2030
o GHG quota will be further increased depending on the growth in e-mobility 25%
25%
o Recognition of Upstream Emission Reductions will cease after 2026
o Introduction of special blending quota for synthetic jet fuels from 2026 on 20%
17.5%
• Phase-out of high ILUC fuels (palm oil) from 2023 on* 15%
12%
• Biofuels from arable crops: max. 4.4% (2018: 3.2%)*
10% 9.25%
• Advanced biofuels from residues min. 2.6% in 2030* 7%
8%
6%
• Multiple counting schemes for electromobility, advanced/synthetic fuels* 5%
0%
* Further regulations to be laid down at ordinance level
October 2021 27More climate protection for Europe
EU taxonomy regulation
• Classification system to promote sustainable investments
• Application on EU environmental targets
• From 2022: climate change mitigation and adaptation on climate change
• From 2023: Protection of water und maritime resources, transition to circular
economy, no/less environmental pollution and protection of
biodiversity/ecosystems
• Evaluation
• Positive: basic idea and recognition of the contribution of biofuels to climate
protection and the adaptation to climate change
• But: exclusion of crop-based biofuels for climate change mitigation measures is
arbitrary and in contradiction to the Renewable Energy Directive
October 2021 28Production sites of CropEnergies
CropEnergies AG
Mannheim - Germany
Zeitz – Germany Wanze – Belgium Loon-Plage – France Wilton – UK
CropEnergies Bioethanol GmbH BioWanze SA Ryssen Alcools SAS Ensus UK Ltd
400,000 m³ ethanol 300,000 m³ ethanol > 100,000 m³ ethanol for fuel 400,000 m³ ethanol
350,000 t DDGS Capacity: more
Annual thereof up to 60,000 m3 neutral > 60,000 t wheat gluten applications
than 1.3 Mm³
capacity: alcohol > 400,000 t ProtiWanze® 90,000 m³ ethanol for traditional
ethanol and more
> 300,000 t ProtiGrain® (DDGS) and technical applications
than 1 Mt food and
100,000 t liquefied CO2
animal feed per
Raw
Grain year
materials: Grain and sugar syrups Grain and sugar syrups Raw alcohol
October 2021 29Financial Calender
13 October 2021: Report for the 1st half of 2021/22
Contakt
12 January 2022: Statement for the 1st-3rd quarter of 2021/22 CropEnergies AG
18 May 2022: Annual report and press and analysts‘ conference FY 2021/22 Maximilianstraße 10
6 July 2022: Statement for the 1st quarter of 2022/23 68165 Mannheim
12 July 2021: Annual General Meeting 2022 www.cropenergies.com
Stock Information Investor Relations Public Relations / Marketing
ISIN: DE000A0LAUP1 Heike Baumbach Nadine Dejung-Custance
Symbol: CE2 Phone: +49 (621) 71 41 90-30 Phone: +49 (621) 71 41 90-65
Bloomberg / Reuters: CE2 GY / CE2G.DE
ir@cropenergies.de presse@cropenergies.de
Transparency standard: Prime Standard
Disclaimer
This presentation contains forward looking statements. The statements are based on current assumptions and estimates made by the executive board and information currently available to its members. The forward looking
statements are not to be viewed as guarantees of the future developments and results presented therein. Future developments and results are in fact dependent on a variety of factors and are subject to various risks and
imponderables. They are based on assumptions that could in fact prove to be invalid. The risk management report in the current annual report presents an overview of the risks. We assume no obligation to update the forward-
looking statements made in this presentation. In addition, all disclaimers published on the CropEnergies website apply.
This presentation includes percentage and number rounding. Typing and printing errors reserved.
Written and visual value statements are standardized as follows:
± 1% - stable ± 1 – 4% - slight 30
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