Kemira – progressing our strategy for profitable growth
Capital Markets Day
September 21, 2017
Kemira Capital Markets Day 2017
11.00 Registration & breakfast
11.30 President & CEO: Jari Rosendal
Pulp & Paper: Kim Poulsen
Industry & Water: Antti Salminen
12.45 Lunch
13.20 Oil & Gas: Pedro Materan
Sourcing: Thierry Blomet
CFO: Petri Castrén
14.35 Coffee break
14.50 Breakout sessions with the management (three groups)
16.05 Cocktails
17.00 End
Program (UK time):
Jari Rosendal
President and CEOPetri Castrén
CFO
Kim Poulsen
President, Pulp & Paper
Antti Salminen
President, Industry
& Water
Thierry Blomet
SVP, Sourcing
Pedro Materan
SVP, Oil & Gas
September 21, 2017Capital Markets Day 2
Today’s speakers
Jari Rosendal
President and CEO
with Kemira since 2014
Key prior positions:
• Outotec
– Member of the Executive Board
– Executive Vice President, President of
Americas Region
– President, Non‐ferrous Solutions Business Area
– President, Minerals Processing Division
• Relevant positions of trust:
• Chemical Industry Federation of Finland
– Member of the Board of Directors
• European Chemical Industry Council (CEFIC)
– Member of the Board of Directors
Petri Castrén
CFO
with Kemira since 2013
Key prior positions:
• Nokia Siemens Networks
– Head of Corporate Finance (Group Treasurer)
– Head of Corporate Development
• Nokia Corporation
– Head of Mergers & Acquisitions
– Various finance and business development
management roles
September 21, 2017Capital Markets Day 3
Today’s speakers
Kim Poulsen
President, Segment Pulp & Paper
with Kemira since 2015
Key prior positions:
• UPM-Kymmene
– Paper Asia, EVP and Group Executive Team Member
– Head of APAC, EVP and Group Executive Team
Member
– Senior Vice President, Plywood business
• Vitalis Gladius
– Owner and Senior Partner
• Paloheimo Group and Fenestra
– President and CEO
• Finnforest
– Several management roles
Antti Salminen
President, Segment Industry & Water
with Kemira since 2011
Key prior positions:
• Kemira
– Executive Vice President, Supply Chain
Management
• KONE
– Director, New Equipment Business, Asia Pacific
– Vice President, Delivery Process
• Capgemini Finland
– Managing Consultant
September 21, 2017Capital Markets Day 4
Today’s speakers
Pedro Materan
SVP, Global Oil & Gas,
Industry & Water
with Kemira since 2006
Key prior positions:
• Kemira
– SVP, RBU Oil & Mining, Americas
– Global Business Development and Global Sales
Manager, Oil and Gas
• Cytec Industries
– Global Marketing Manager for Oilfield
– Sales Manager, Americas for Phosphine Chemicals
(Oil, Mining and Textiles)
– Regional Technical Sales Manager for Water
Treatment
– Sales Rep for Water Soluble Polymers
Thierry Blomet
SVP, Sourcing
with Kemira since 2013
Key prior positions:
• PPG
– Director, Raw Material Purchasing EMEA
– Director, Indirect Purchasing EMEA
– Business Director – Industrial Finishes Europe
• Dupont
– Business Director – Coatings for mass production
industry
September 21, 2017Capital Markets Day 5
Kemira – progressing our strategy for profitable growth
Capital Markets Day
Jari Rosendal, President and CEO
September 21, 2017
GEOGRAPHIESSEGMENT SPLIT PRODUCTS
Kemira in briefFY2016: Revenue EUR 2,363 billion, Operative EBITDA EUR 302.5 million, margin 12.8%
25% Bleaching
and pulping
20%Polymers
20% Other:
e.g. defoamers,
dispersants,
and biocides
20%Coagulants
15% Sizing
and strength
Revenue by product category rounded to the nearest 5%
38%AMERICAS
1.USA
2.Canada
3.Brazil52%EUROPE
1.Finland
2.Sweden
3.Germany
10%APAC
1.China
2. Indonesia
3.South
Korea
62%Pulp &
Paper
38%Industry
& Water
CUSTOMERS
8,000 Sold-to customers
16,000 Ship-to customers
Examples of largest customers
September 21, 2017Capital Markets Day 7
#1 in water
treatment in
NA and
Europe
#1 in shale
in NA
#1 globally
London
New York City
Frankfurt
Paris
Shanghai
Singapore
Municipalities, e.g.
Our targets and actions for profitable growth
September 21, 2017Capital Markets Day 8
ORGANIC GROWTH• Investments in capacity expansion
• Seize opportunities in growth pockets
• Shale oil & gas business
• CEOR and oil sands
• Digitalization
• APAC
• R&D, new products
ACQUISITIONSVery selective approach
• Strategic and synergistic fit
• Accretive to profitability
• Reasonable valuation
EFFICIENCY• Manufacturing footprint
and utilization optimization
• BOOST – Operational
excellence
• Organizational efficiencies
with new structure
• Complexity reduction
• Efficient processes
OPERATING COST
DISCIPLINEPrudent cost culture
Above-the-market
growth and operative
EBITDA of 14-16%
Expansion of
pulp chemicals,
Oulu (FI)
Progress in profitable growth
September 21, 2017Capital Markets Day 9
AcquisitionOpening / expansion of site Operational efficiencies
Opening of Tarragona
coagulant site (ES)
Acquisition BASF
AKD emulsion business
Opening of EMEA
service center
Expansion of dry
and emulsion
polyacrylamide
(US)
Opening of
Nanjing (CN)
site
Closure of
Longview (US)
AkzoNobel’s
paper chemicals
acquisition
Acquisition of Soto
Industries (US)
Closure of
Soave (IT)
Start-up of Ortigueira
(BR) sodium chlorate site
and announcement of
Joutseno (FI) expansion
Acquisition
of Polymer
Services (US)
Botlek (NL)
modernization
BOOST operational
excellence program
launch
Bradford (UK)
expansion
San Giorgio (IT)
expansion
Closures of Ottawa (CA)
and Zaramillo (ES)
Closure of site
Q416
Transportation
agreement with
Odyssey
Q117
Odyssey go-live
in North America
Two segment
structure
operational
Q217
Q316
Q114
Q314
Q414
Q115
Q215
Q315
Q415
Q116
Q216
Q214
11.3%2013 operative
EBITDA
12.8%2016 operative
EBITDAQ317
Start-up of
Joutseno (FI)
chlorate
expansion
Kemira has managed to improve EBITDA even withthe downturn in the O&G market
Revenue
22292137
2373 2363 2420
2013 2014 2015 2016 LTM
Operative EBITDA and
operative EBITDA margin
September 21, 2017Capital Markets Day 10
EUR million EUR million
252 253
287303 297
11.3%
11.8%12.1%
12.8%
12.3%
2013 2014 2015 2016 LTM
Between 2014-2016, Oil & Mining revenue and operative EBITDA dropped EUR 70 million and EUR 30 million respectively
LTM = Last Twelve Months ending June 2017
Kemira’s relevant market expected to show healthy growth
Long-term drivers for growth, including:
• E-commerce drives the need for packaging material
• Growing middle class, increased standards of living
and urbanization leads to higher usage of water,
energy, tissue, and board
• Recycling and use of renewables leads to e.g. higher
usage of strength chemicals
• Regulation increases water treatment
• Scarcity of resources accelerates need to produce
more with less
Challenges
• Risks to global GDP growth
• Decline in demand for printing and writing paper
demand 2017 2022
Market growth by business areas: Pulp & Paper 1%, Water treatment 2-3%, Oil & Gas 5-6% p.a.
September 21, 2017Capital Markets Day 11
2-3%
3-4%
CAGR
2017-2022
~20
~23
+3%
2-3%
Management estimation based on various sources
Americas
EMEA
APAC
Relevant target market (EUR billion)
APAC is driving future market growth
• APAC market is the largest and fastest
growing market
• Our business in APAC has been growing and
EBITDA turned to positive after 2014
– New greenfield manufacturing site in Nanjing,
China in 2014 and acquisition of AkzoNobel’s
paper chemicals in 2015 have helped to improve
profitability
– We are market leader in Pulp & Paper with ~10%
market share
– Industry & Water continue to grow, albeit from
small base
September 21, 2017Capital Markets Day 12
* H1 2017 annualized
2011 2013 2015 H12017*
2011 2013 2015 H12017*
Operative
EBITDA
Revenue
We innovate for the future through customer
collaboration, partnerships and open innovation.
We use digitalization to improve our own
performance as well as the services offered to
customers.
250 R&D experts create new innovations
in R&D centers in Finland, China and US.
348 patent families
Over 1,200 patents
Innovation drives growth – EUR 220 million revenue from recent innovations
25% Bleaching
and pulping
20%Polymers
20% Other:
e.g. defoamers,
dispersants,
and biocides
20%Coagulants
15% Sizing
and strength
Products
EUR 2.4bn
Innovation sales on track – pipeline strongSales from new products (launched within the last 5 years)
Best selling new
products in 2016
1. Oil & Gas – Freeze
tolerant friction reducer
2. Oil & Gas –
Stabilizing additives for
CEOR polymers
3. Pulp & Paper –
Strength for tissue
September 21, 2017Capital Markets Day 14
5%
7%
8% 8%
9%
0
50
100
150
200
250
300
2012 2013 2014 2015 2016
of Group’s revenue from new products
BOOST update - targeting EUR 20-30 million of savings and EUR 50 million of inventory reduction
2,300products
63manufacturing
sites
13,000suppliers
200warehouse
locations
16,000ship-to-
customers
250,000orders per
year
BOOST is about improving
competitiveness through
efficiency
Majority of savings will
result from logistics
• Kemira spends annually
around EUR 170 million on
road transportation
• Sourcing of logistics by
Odyssey expected to yield
significant savings of road
transportation cost
• Odyssey roll-out done in
North America in April and
Europe to follow
Distribution
center
KemiraSupplierCustomer
Kem
Connect
Customer
Service
Our key actions to improve margins
2015 2016 2017 LTM Acquisitionsynergies
Group Pulp &Paper
BOOST -operationalexcellence
Industry &Water
Industry &Water
Industry &Water
Volatility Mid- tolong-term
target
September 21, 2017Capital Markets Day 16
12.3%
Operative EBITDA
margin 14-16%
New
bleaching
chemical
capacity
(Joutseno,
Finland)
Optimization
of operations:
majority of
savings in
logistics
Oil sands
Chemical
Enhanced
Oil Recovery
12.1% Efficiencies
from new
two segment
structure
12.8%
Estimated end of 2017 run-rate 100% 100% 75% Low 25% Low Low
Full run-rate by EO 2017 EO 2017 2018 1-2 yrs 2-3 yrs 2-5 yrs 3-5 yrs
AkzoNobel’s
paper
chemicals
business
Advanced
Water
Treatment
Market and
raw material
related
volatility
LTM = Last Twelve Months ending June 2017
• Our first priority is safety of employees and we are happy
to report that everyone is safe
• Multiple oil refineries and chemical providers impacted
short-term by consequences of flooding
• Only limited short-term direct impact on Kemira
– Our assets were not damaged
– Customer operations not materially impacted
• Indirect impact also limited – full recovery depends on
normalization of supply chain
– Availability of raw materials partially limited
– Disruptions in logistics
Hurricanes Harvey and Irma impacting chemical industry
September 21, 2017Capital Markets Day 17
Primary business / company (primary region)
Board and paper chemicals / Soto (Canada) Q3/2013
Polymer manufacturer / 3F (global) Q4/2013
Board and paper chemicals / BASF AKD (Europe) Q2/2014
Board and paper chemicals / Akzo Nobel (global) Q2/2015
Board and paper chemicals / Soto (US) Q3/2015
Oil field services / Polymer Services (US) Q4/2015
Selective acquisitions possible if strategic fit and financials reasonable
Acquisition criteria
• Must improve operative EBITDA margin in second full year after
closing
• Must be synergistic and strengthen market position and/or our
competencies
September 21, 2017Capital Markets Day 18
• Investments done in profitability enhancing growth areas
– New chlorate plant in Brazil 2016
– New chlorate line in Finland in 2017
– Capacity additions related to AkzoNobel acquisition
– Polymer capacity additions
• Balanced cash flow and capex
– Good maintenance capex control
– Prudent strategic prioritization of investments
– Optional investments / M&A in profitable growth areas
– Net working capital optimization
Balanced cash flow and capex
September 21, 2017Capital Markets Day 19
Progressing our strategy for profitable growth
GROUP’S MID- TO LONG-TERM TARGETS
Above-the-market growth
Operative EBITDA 14-16%
Gearing below 60%
Dividend policy: stable and competitive dividend
Balanced cash flow
and capex
Increase
efficiency
Grow by investing,
innovating and capturing
market opportunities
Pulp & Paper – driving growth as market leader
Capital Markets Day
Kim Poulsen, President, Pulp & Paper
September 21, 2017
REVENUE BY
PRODUCT CATEGORY
REVENUE BY CUSTOMER
TYPE AND MARKET GROWTH
REVENUE AND
OPERATIVE EBITDA
Pulp & Paper – market leader with solid track record
September 21, 2017Capital Markets Day 22
Note: Revenue by industry, product and geography rounded to the nearest 5%
MARKET ENVIRONMENT REVENUE BY GEOGRAPHIES AND
MARKET GROWTH BY REGION
CUSTOMER EXAMPLES
1047 10681170
1417 1457
109130
137171
195
2012 2013 2014 2015 2016
35%Americas
50%EMEA
15%APAC
35%Bleaching
& pulping
25%Sizing & strength
20%Defoamers,
dispersants,
biocides and other
process chemicals
10%Polymers
10%Other
40%Pulp
20%Printing &
writing papers40%Board &
tissue
-1-2%2-3%1-2%Market
growth
2-3%0-1%0-1%Market
growth
AkzoNobel (pulp) #4
BASF (paper) #2
Solenis (paper) #3
Kemira (pulp and paper) #1
Ecolab (paper) #5
Customer interview with UPM
2016 CMD
• UPM was one of our TOP 5 clients
• Jyrki Ovaska EVP, Technology at UPM
interviewed by video
• Mr. Ovaska’s feedback about UPM’s business
relationship with Kemira
– Kemira’s international footprint matches
UPM’s locations
– Comprehensive product portfolio is attractive
– Further potential for Kemira to increase share
of UPM’s business
– Request for more collaboration to find new
innovations and efficiencies
2017 CMD
• UPM is now one of our TOP 3 clients
• Mr. Ovaska’s feedback regarding change
from 2016 to 2017 visible on video
September 21, 2017Capital Markets Day 23
Our winning formula to continue growth
September 21, 2017Capital Markets Day 24
Above-the-market
growth
and operative
EBITDA
14-16%
Improve customer experience
Maximize capacity
utilization
Manage fixed costs
Invest in growth and R&D
• Capacity additions
• 9 new products in 2016
• New mgmt. structure
• Employee engagement –
15/16 survey items
improved since 2015
• TOP 50 customers are EUR 1bn
• Customer satisfaction to 98%
• Bleaching ran flat out 9 years
• Paper chemicals varying
• H1 2017 business overheads
below 2016 level
• Group: 240 products out
• Target to reduce by 200 in 2017
Reduce complexity
Enhance
performance culture
Board and paper production shifting to emerging markets
Growth of board
and paper production
by region 2015-2030
• 55mt growth in APAC by
2030
BIGGEST PRODUCERS ARE:
China, USA, Japan, Germany,
India, Sweden, Korea, Canada,
Finland, Brazil
BIGGEST GROWTH
AREAS ARE:
China, India, Indonesia, Brazil,
Russia, Vietnam
North America
2015: 82 mt
2030: 75 mt
Latin America
2015: 21 mt
2030: 31 mt
W. Europe
2015: 85 mt
2030: 78 mt
E. Europe
2015: 18 mt
2030: 26 mt
China
2015: 106 mt
2030: 139 mt
Africa
2015: 4 mt
2030: 6 mt
Oceania
2015: 4 mt
2030: 4 mt
Japan
2015: 26 mt
2030: 21 mt
Rest of Asia
2015: 55 mt
2030: 82 mt
TOTAL BOARD & PAPER PRODUCTION:
2015: 402 million tons
2030: 461 million tons
CAGR%: around 1 % / annum
Source: Pöyry
Strong market positions and strategic investments
REGION MARKET POSITION GROWTH TREND GROWTH STRATEGY
EMEA
North America
APAC
South America
#1
#2/3
#1
#3
Exceptional customer
experience
Transformation from paper
to board
Continue to grow with major
players (TCM) and assess
future investments
Assess future bleaching
investments
TCM = Total Chemistry Management
Market position strengthened through successful acquisition
• AkzoNobel’s paper chemicals acquired
in May 2015
– Target initially EUR 15 million
– Run-rate ahead of plan, close to EUR 20
million
• Acquisition strengthened our position
especially in APAC
– 4 of 6 sites acquired were in APAC
• APAC capacity addition in Nanjing,
China executed well and ramping up
according to plan
September 21, 2017Capital Markets Day 27
Hallam
– Australia
Pasuruan
– Indonesia
Wellgrow
– Thailand
Gunsan
– KoreaNanjing
– China
Yanzhou
– China
Acquired site
Kemira site
We have become market leader in APAC
Pulp & Paper relevant chemicals market 2017 EUR million
• Board and paper production in APAC
will be bigger than Europe and North
America combined by 2020
• >90% of global board and paper
production growth in APAC
• Kemira now #1 with close to 10%
share in APAC
– Revenue doubled to around
EUR 200 million in 3 years
• Fragmented market provides good
potential for profitable growth
• Continue to grow revenue and market
share 0 2000 4000 6000
South America
APAC
North America
EMEA
September 21, 2017Capital Markets Day 28
0-1%
-1-0%
2-3%
2-3%
CAGR
2017- 2022
Source: Pöyry, management estimation
Strong demand in pulp market creating growth opportunities
• New pulp mill projects are driven by
increasing demand for board and tissue
– Food and liquid packaging board is
growing particularly fast in Asia
– Pulp is produced close to wood sources and
then shipped to board, paper, and tissue mills
– Growth in board = 1 new pulp mill per year
• Multiple pulp mill projects realised and
expected in Northern Europe creating
opportunities for Kemira to grow with
the market
• In addition, a few large scale pulp mill
projects expected in South America
September 21, 2017Capital Markets Day 29
Confirmed new capacity / debottlenecking 2016-2020
Possible new mills 2020-2022
Successful value creating investments – case Joutseno
Kemira bleaching chemicals revenue growth
• Kemira’s capacity in sodium chlorate was fully
utilized, hence the need for additional
capacity
• Capacity doubled in Joutseno with around
EUR 50 million investment
• Investment realized according to budget and
start-up was ahead of schedule in early
September 2017
• Targeting maximum capacity utilization by
H2 2018
– Part of the production will be shipped to APAC
to support the growth in the region2014 2015 2016 2017 H1 ann.
September 21, 2017Capital Markets Day 30
+7%
+10%+5% +3%
+6%
CAGR
Industry & Water – stronger platform for profitable growth
Capital Markets Day
Antti Salminen, President, Industry & Water
September 21, 2017
Industry & Water –
stronger platform for
profitable growth
• Profitable and stable underlying
business
• New structure creates growth
and efficiency opportunities
• Innovation supporting growth
in selected areas
MARKET POSITION
220227
231 228238
248
Q1 Q2 Q3 Q4 Q1 Q2
REVENUE BY
PRODUCT CATEGORY
REVENUE BY APPLICATION
TYPE AND MARKET GROWTH
Industry & Water – strong positions in chosen categories
Note: Revenue by industry, product and geography rounded to the nearest 5%
REVENUE AND ORGANIC
GROWTH (Y-O-Y)EUR million
Capital Markets Day 33
REVENUE BY GEOGRAPHIES AND
MARKET GROWTH BY REGION
CUSTOMER EXAMPLES
45%Coagulants
35%Polymers
20%Other products
such as
defoamers
and biocides
2-3%5-6%2-3%Market
growth
September 21, 2017
40%Americas
55%EMEA
5%APAC
70%Water treatment
15%Other15%
Oil & Gas
5-6%3-4%3-4%Market
growth
Municipal (40%), customer examples
Amsterdam
Barcelona
Frankfurt
London
Oslo
Paris
Stockholm
Los Angeles
Montreal
New York City
Toronto
Melbourne
Shanghai
Singapore
Industrial (60%), customer examples
Market share in water
treatment in Europe and
North America
Market share in polymers
used for friction reduction
in US shale fracking
>30%
30%
-7% -5% -5% 0% +6% +9%
2016 2017
REVENUEEUR million
956 906
447 485
2015 2016 H1 2016 H1 2017
116107
54 52
12.2% 11.8% 12.2% 10.8%
2015 2016 H1 2016 H1 2017
Returning to growth in 2017
• In 2016, financials impacted by market
turmoil in shale industry
• H1/17 revenue growth looks promising
– Growth +9%, driven by Oil & Gas
– Volume growth in water treatment +2%
• Profitability was impacted by higher raw
material prices
• Profitable growth opportunities:
– Selected applications within Oil & Gas,
such as CEOR and oil sands, as well as
shale fracking
– Advanced Water Treatment (AWT)
– Water treatment in APAC
Capital Markets Day 34
+9%
OPERATIVE EBITDA AND OPERATIVE
EBITDA MARGINEUR million
September 21, 2017
New structure creates growth and efficiency opportunities
• Leveraging the full potential of new combined
segment
– Full geographical reach in all regions
– Global polymer expert network
– Water treatment expertise for O&G and Mining
• Structural change means faster decision making
• More efficient development and roll-out of new
innovations
• Important part of segment’s profitability improvement
– On Group-level cost savings EUR 15-20 million
Capital Markets Day 35
Oil &
Mining
Municipal
& Industrial
70%Water
treatment
15%Oil & Gas
Industry
& Water
15%Other
applications
September 21, 2017
REVENUE IN GROWTH INITIATIVESEUR million
24 28
0
20
40
60
80
2015 2016
Water Treatment Oil & Gas
Profitable growth opportunities ahead...
• H1 2017 showed good volume growth
– +2% in water treatment
– Around +50% in Oil & Gas
• Multiple initiatives ongoing to boost growth in both businesses
Capital Markets Day 36
BUSINESS AREA REGION GROWTH INITIATIVES IN 2015-2017
WATER
TREATMENT
EMEA Desalination
BioGas
Sludge dewatering
Middle East and Africa
NA Odor control
Sludge dewatering
APAC Deep sludge dewatering
OIL & GAS GLOBAL CEOR
Oil sands in Canada
+65%
September 21, 2017
…fueled by strong innovation pipeline
Capital Markets Day 37
>20Continuous
ideas inflow
Projects under evaluation
Enhanced Oil Recovery
Projects under development and early commercialization Projected 10-yr NPV
8
2
3
12
1
EUR
650 million
AWT = Advanced Water Treatment
Oil sands
Shale oil & gas
Solid liquid separation (incl. AWT)Sludge dewatering, nutrients recovery, mining processes
Desalination, re-use & disinfection(incl. AWT)
2
3
12
1
September 21, 2017
# of
projects
EUR 110 million, 12% of Industry & Water revenue from innovation in 2016
The next generation of sludge treatment
will focus on customer performance and
value created
KemConnect Smart Dewatering combines
a complete chemicals portfolio, continuous
chemistry optimization and real-time
monitoring to a new business model
Dewatering Today Smart DewateringTomorrow
Innovation case – KemConnect Smart DewateringADVANCED WATER TREATMENT CASE EXAMPLE
Disposal
Cost
KemConnect
Service Fee
Disposal
Cost
Customer
Net Savings
Chemical
Cost
Stronger platform for
profitable growth
• Strengthened business in growing
market
• New structure enables greater agility and
higher profitability
• Profitable growth opportunities driven by
innovation
• Oil & Gas returned to growth
Oil & Gas –well positioned for growthin niche areas
Capital Markets Day
Pedro Materan, SVP, Oil & Gas
September 21, 2017
85% of business
in polymers
200 Customers
Oil & Gas – small and focused teamDesigned to extract more
September 21, 2017Capital Markets Day 41
DESIGNED
TO EXTRACT
MORE
A unique combination
of innovative chemicals
and application
knowledge that
improves process
efficiency and yield in
oil & gas applications
152 Revenue in
EUR million (LTM)
30 Global
commercial
team
75%Revenue in Americas
90% On upstream and in
water related applications
LTM = Last Twelve Months ending June 2017
KEMIRA OIL & GAS REVENUE
Resilient business set for growth
• Growing market demand with our
selective market diversification assuring
growth
• Kemira’s offering
– Process efficiencies: polymers that reduce
energy consumption by 60% in shale oil
fields
– Cost reduction: higher concentrated
liquids that make offshore oil recovery
more cost effective (CEOR)
– Addressing environmental regulations:
tailing treatment in oil sands
• New innovative technologies driving
expansion
September 21, 2017Capital Markets Day 42
25%Other
50%Shale fracking
25%Oil sands and
Chemical Enhanced
Oil Recovery
Revenue
EUR 152 m(LTM)
0
50
100
150
200
2013 2014 2015 2016 LTM
+47%in H1/17
Oil
price
Figures rounded to closest 5%
LTM = Last Twelve Months ending June 2017
Well positioned and growing into adjacent areas
New global organization concentrating on
extraction areas
September 21, 2017Capital Markets Day 43
Oil & Gas
revenue
Upstream
Reaching
Midstream
Producing
Downstream
Transporting
Downstream
Processing
90% 90% 10%
Area Oilfield
Chemicals
Oilfield
Services
MARKET
POTENTIAL
(AVAILABLE)
Around €1.5bn Around €1bn
APPLICATIONS Drilling
Cementing
Shale
Oil sands
Production
CEOR
CUSTOMERS Service
companies
Operators
VALUE
PROPOSITION
Manufacturing +
Innovation
Solutions
GROWTH
(KEMIRA’S)
Moderate Strong
KEMIRA
• Provides unique chemistries, friction reducers,
that reduce energy needed during hydraulic fracturing
• Volume growth over 100% in H1 2017
• Differentiating from competitors with innovative products
Shale Market
• Polymer market size +200M
EUR and growing at double
digit today
• Polymer more favorable
product based on
cost/performance
September 21, 2017Capital Markets Day 44
Our innovations make shale industry more efficient
KEMIRA
Competitor A
Competitor B
Competitor C
Others
Market shares
in polymers used
for fracking
#1 market position
with over 30%
market share
KEMIRA
• Kemira’s MaxXtract solution tailored specifically to customer
needs, incorporating chemistry, equipment and services
• Kemira’s knowhow in polymers helps oil producers
• Potential for > EUR 100 million revenue in 5 years
Substantial long-term growth
potential within existing
CEOR projects and
through new projects
Chemical Enhanced
Oil Recovery market
• CEOR market size EUR 1bn of
which EUR 500 million
accessible to Kemira
• Market growth estimated to be
5% driven by decline of
production from existing fields
September 21, 2017Capital Markets Day 45
Long-term growth potential in CEOR
KEMIRA
• Offers total solutions to reduce environmental concerns
• Customer base expanding
• Revenue has grown to above EUR 20 million in 2 years
• Target to more than double current revenues in 2-3 years
Companies operating in oil sands market (examples)
Oil sands market
• Market size is around
EUR 400 million
• Projects are capex-heavy
but developed projects are
considered as sunken costs
September 21, 2017Capital Markets Day 46
Oil sands has grown from 0 to above EUR 20m in 2 years
OIL & GAS REVENUE GROWTH
EUR million
Building on current performance for future growth
Strategic priorities
• Strengthen position and keep growth
momentum
• Increase margins
• Hire and develop our people
• Innovate for further growth
– Introduction of new products
– Field trials in new key applications
September 21, 2017Capital Markets Day 47
75%Americas
25%EMEA
57
83
H1 2016 H1 2017
+47%
New business –
EUR 30 million
Niche position in
niche market
Oil & Gas well positioned for growth in niche areas
September 21, 2017Capital Markets Day 48
Diversification –
EUR 152 million (LTM)
Growing in shale,
oil sands and CEOR
Bigger and better
Strong player in three
core areas (shale, oil
sands, CEOR), including
service capabilities
2017 Phase II 2022 Phase III2009 Phase I
Oil & Mining Industry &
Water:
Global
Oil and Gas
LTM = Last Twelve Months ending June 2017
Sourcing – contributing to profitability improvement
Capital Markets Day
Thierry Blomet, SVP, Sourcing
September 21, 2017
Strategic sourcing improves cost competitiveness, service performance, and reduces risk
September 21, 2017Capital Markets Day 50
VARIABLE COST SPLIT 2016
EUR 1.3 billion
EXPOSURE TO OIL RELATED
RAW MATERIALS
TOP 10 RAW MATERIALS
BY SPEND
1. Sodium hydroxide
2. Acrylonitrile (OR)
3. Colloidal silica dispersion
4. Fatty acid
5. Aluminium hydrate
6. Amines (OR)
7. Alpha olefin (OR)
8. Acrylic ester (acrylic acid and
methyl acrylate) (OR)
9. Petroleum solvents (OR)
10.Sodium chloride
Top 10 account for almost 50%
of Kemira’s raw material spend
30%Oil related
70%Not oil
related
65%Raw
materials
15%Electricity
& energy
20%Logistics
Sourcing continues to improve Kemira’s performance
Single source dependency% of total raw material spend
0
5
10
15
20
25
30
35
2012 2013 2014 2015 2016
Payment termDays
0
5
10
15
20
25
30
35
40
45
50
2012 2013 2014 2015 2016
September 21, 2017Capital Markets Day 51
REDUCE
RISK
IMPROVE
WORKING
CAPITAL
Improved
by 15 days
Improved
over 20ppt
Sourcing helps business to improve profitabilityin changing markets
Raw material availability Price dynamics
September 21, 2017Capital Markets Day 52
Supply / demand impacted by investments,end-markets and disruptions
Long cycles of oversupply
or tightness driven by
producers’ investments
and industry demand
Our solution:
1. Contracted supply vs.
spot is critical
2. Timing, and length of
contracts are key to
competitiveness
3. Multiple sources required
Supply disruptions are
typical in chemical industry
September 21, 2017Capital Markets Day 53
-50%
-30%
-10%
10%
30%
50%
70%
90%
Jan-16 Mar-16 May-16 Jul-16 Sep-16 Nov-16 Jan-17 Mar-17 May-17 Jul-17
WTI Crude Oil Jet Kero 55
US Propylene US Ethylene
Acrylonitrile Acrylic Acid
Feedstock and raw material price dynamicsChange (y-o-y) in key feedstock and raw material prices in the US
September 21, 2017Capital Markets Day 54
Around 30% of raw material
spend is connected to volatile
vertically integrated
petrochemical value chain
Most feedstock are globally
traded commodities
significantly influenced by
FX and cross-region trading
arbitrage
Our solution:
1. Value-chain cost
modeling
2. Agile price
managementKey oil related raw materials
Key feedstock
WTI +68%Propylene +33%
Acrylonitrile +18%
Better sourcing, through strategic management of over EUR 1bn spend, is contributing to profitability improvement
Reduce single source dependency
Increase preferred vendors spend
Drive supplier relationship strategically
Single source exposure< 5% of total raw material spend
Preferred vendors share> 65% of total indirect spend
Supplier initiatives> EUR 5 million savings
Sourcing fixed cost< 0.3% of Kemira revenue
Digitalize and automate to increase efficiency
Actions Targets
Kemira continues to grow supported by value creating investments
Capital Markets Day
Petri Castrén, CFO
September 21, 2017
PULP & PAPER
11.5% 11.8% 11.7% 12.1%
13.4% 13.0%
2012 2013 2014 2015 2016 LTM
MUNICIPAL & INDUSTRIALINDUSTRY & WATER
Both segments targeting 14-16% operative EBITDA
• Pulp & Paper has gradually improved its margin towards 14-16% range
• Raw material price pressure was visible in both segments in H1 2017
September 21, 2017Capital Markets Day 57
Mid-to
long-term
target
Target
14-16%
10.4% 10.4%
12.3% 12.2% 11.8%11.1%
2012* 2013* 2014* 2015* 2016 LTM
Target
14-16%
Mid-to
long-term
target
9.3% 10.4%12.1%
13.7% 14.9%
2012 2013 2014 2015 2016
OIL & MINING
12.6%10.5%
12.7%9.6%
5.9%
2012 2013 2014 2015 2016
LTM = Last Twelve Months ending June 2017
* Figures are sum of M&I and O&M segments
VARIABLE COST VS SALES PRICE TREND
Raw material costs and sales price correlation
September 21, 2017Capital Markets Day 58
• Strong correlation between sales prices and variable costs
• In the history, the lag has been around 2-3 quarters
-150
-100
-50
0
50
100
150
200
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Brent oil, USD Sales prices* Variable costs* *) 12-month rolling change vs previous year in EUR million
Profitability impacted by net change of sales prices and variable costs
• In 2016, net change of sales prices
and variable costs compared to 2015
was zero
• In H1 2017, clear headwind
– Net impact of sales prices and variable
costs on EBITDA was around EUR -36
million
– This is being mitigated by price increases
• We expect headwind to ease in the
coming quarters
Sales prices and variable costs on
EBITDA level (change y-o-y)
9
5
-3-10
-16 -20
-9
-18
-26-23
-16
-4
-18
-23 -23
-13
0
16
-30
-20
-10
0
10
20
Q1 Q2 Q3 Q4 Q1 Q2
2016 2017
Net impact on EBITDA (sales prices-variable costs)
Sales prices
Variable costs
September 21, 2017Capital Markets Day 59
134139 146
182
213
2012 2013 2014 2015 2016 2017
Investing in value creating growth
Recent largest value creating investments
• New chlorate plant in Brazil and new chlorate
line in Finland
• Capacity additions due to integration of acq.
• Polymer capacity in Italy and UK
CAPEX guidance and return criteria
• In 2018, depending on timing of
opportunities, EUR 160-200 million
– Includes capacity expansion in Oil & Gas
• Thereafter, around 5-6% of revenue
– Flexibility maintained for selected major
expansion projects
• Expansion projects in strategic investment
areas with sufficient financial returns
Capital expenditure excluding acquisitionsEUR million
September 21, 2017Capital Markets Day 60
Expansion Improvement Maintenance
Around
EUR 200m
2017 2018 2019 2020 2021 2022 2023 2024
EIB NIB Bilaterals Bonds Undrawn RCF Others
Debt portfolio is well diversified
Net debt / operative EBITDA and Gearing Gross debt maturity profile, end of Q2 2017 EUR million
September 21, 2017Capital Markets Day 61
127
80
110
150
205 200
42% 41% 42%
54% 54%
61%69%
2012 2013 2014 2015 2016 H12016
H12017
1.9x2.1x 2.1x2.2x1.8x 2.6x2.3x
532m 758m456m 486m 634m642m 690m
400249m297m (r12m)
252m 253m 303m287m 298m
Net debt
OperativeEBITDA
Continue to grow supported by value creating investments
Deliver higher profitability
Efficient capital
allocation and returns
Improve cash flow
1
2
3
GROUP
Above-the-market growth
Operative EBITDA 14-16%
Gearing below 60%
Dividend policy:
stable and competitive dividend
Group’s mid- and long-term
financial targets
CEO’s closing remarks
GROUP
Above-the-market growth
Operative EBITDA 14-16%
Gearing below 60%
Dividend policy:
stable and competitive dividend
What has changed since 2016 CMD
• Oil & Gas is back on track
• Sales price decline stopped
• Organizational structure streamlined –
leaner and more agile
• Expansion investments completed
• BOOST progressed
• R&D – new products launched
Group’s mid- and long-term
financial targets
Appendix
Key figures – 2017 vs 2016
EUR million Q2 2017 Q2 2016 Δ% H1 2017 H1 2016 Δ%
Revenue 617.2 587.8 +5 1,227.3 1,170.5 +5
Operative EBITDA 77.1 78.9 -2 146.1 151.7 -4
margin 12.5% 13.4% - 11.9% 13.0% -
Operative EBIT 43.6 46.6 -6 78.6 87.5 -10
margin 7.1% 7.9% - 6.4% 7.5% -
Finance costs, net -7.7 -0.3 - -14.4 -6.3 -
Earnings per share, EUR 0.12 0.17 -29 0.24 0.33 -27
Cash flow from operations 28.6 57.0 -50 40.8 83.2 -51
Capex excl. acquisitions 45.2 43.3 +4 82.1 74.7 +10
Net debt 758 690 +10 758 690 +10
Gearing, % at period-end 69 61 - 69 61 -
Inventories 227 214 +6 227 214 +6
Personnel at period-end 4,849 4,873 0 4,849 4,873 0
September 21, 2017Capital Markets Day 65
Pulp & Paper
EUR million
Q2
2017
Q2
2016 Δ%
H1
2017
H1
2016 Δ% 2016 2015 Δ%
Revenue 368.9 361.1 +2 741.1 723.5 +2 1,457.3 1,417.3 +3
Operative EBITDA 47.8 49.3 -3 93.8 97.2 -3 195.3 171.0 +14
margin 13.0% 13.7% - 12.7% 13.4% - 13.4% 12.1% -
Operative EBIT 25.7 28.9 -11 49.6 57.1 -13 111.6 96.8 +15
margin 7.0% 8.0% - 6.7% 7.9% - 7.7% 6.8% -
Capital expenditure 35.2 25.8 +37 65.0 40.6 +60 125.1 240.1 -48
Cash flow after investing
activities
8.9 59.3 -85 -14.0 58.6 - 105.7 -63.2 -
September 21, 2017Capital Markets Day 66
Industry & Water
EUR million
Q2
2017
Q2
2016 Δ%
H1
2017
H1
2016 Δ% 2016 2015* Δ%
Revenue 248.3 226.7 +10 486.1 447.0 +9 906.0 955.8 -5
Operative EBITDA 29.3 29.6 -1 52.3 54.5 -4 107.2 116.3 -8
margin 11.8% 13.1% - 10.8% 12.2% - 11.8% 12.2% -
Operative EBIT 17.9 17.7 +1 29.0 30.4 -4 58.5 66.3 -12
margin 7.2% 7.8% - 6.0% 6.8% - 6.5% 6.9% -
Capital expenditure 10.0 17.6 -43 17.1 32.3 -47 85.5 64.9 32
Cash flow after investing
activities
3.3 5.1 -36 12.5 6.5 +90 35.6 48.9 -27
September 21, 2017Capital Markets Day 67
* Sum of Oil & Mining and Municipal & Industrial segments.
Revenue split by countryFY 2016
September 21, 2017Capital Markets Day 68
AMERICAS
APAC
EMEA
USA 27%
Canada 5%
Brazil 3%
Uruguay 2%
Other Americas 1%
Finland 14%Germany 6%
Sweden 6%
Poland 3%
UK 3%
Spain 2%
Other APAC 6%
Indonesia 1%
China 3%
Other EMEA 8%
Norway 2%
Russia 2%
Netherlands 2%
France 2%
Italy 2%
KEMIRA REVENUE DISTRIBUTION
2016
KEMIRA COST DISTRIBUTION
2016
Revenue and cost distribution per currency
September 21, 2017Capital Markets Day 69
• Currency exchange rates had around EUR +4 million impact on the operative
EBITDA in Q2 2017 and around +5 million in H1 2017.
• Guidance: 10% change in our main foreign currencies would approximately have
EUR 10 million impact on operative EBITDA on an annualized basis
EUR
44%
USD
35%
CAD 4%
BRL 3%
CNY 3%
Others 11%
EUR
41%
USD
31%
CAD 4%
SEK 8%
CNY 4%
Others 12%
Key figures and ratios – 5-year summary
EUR million (except ratios) 2012* 2013 2014 2015 2016
Revenue 2,240.9 2,229.1 2,136.7 2,373.1 2,363.3
Operative EBITDA 249.4 251.9 252.9 287.3 302.5
of which margin 11.1% 11.3% 11.8% 12.1% 12.8%
Operative EBIT 155.5 164.2 158.3 163.1 170.1
of which margin 6.9% 7.4% 7.4% 6.9% 7.2%
Cash flow from operations 176.3 200.3 74.2 247.6 270.6
Capital expenditure, excluding acq. 134.1 133.5 140.6 181.7 212.6
Gearing at period-end 42% 41% 42% 54% 54%
Inventories 182 170 197 207 217
Personnel at period-end 4,857 4,453 4,248 4,685 4,818
September 21, 2017Capital Markets Day 70
* Restated figures reflect the change of IAS 19, Employee Benefits
Per share figures – 5-year summary
2012 2013 2014 2015 2016
Earnings per share, EUR 0.12 -0.21 0.59 0.47 0.60
Cash flow from operating activities per share, EUR 1.16 1.32 0.49 1.63 1.78
Equity per share, EUR 8.20 7.32 7.57 7.76 7.68
Dividend per share, EUR 0.53 0.53 0.53 0.53 0.53
Share price, EUR, end of period 11.81 12.16 9.89 10.88 12.13
Market capitalization, EUR million 1,796 1,849 1,504 1,654 1,848
Number of shares, million (excl. treasury shares) 152.0 152.0 152.1 152.1 152.4
P/E ratio 98.4 - 16.7 23.3 20.2
P/CF ratio 10.2 9.2 16.7 6.7 6.8
P/B ratio 1.4 1.7 1.3 1.4 1.6
Dividend yield, % 4.5 4.4 5.4 4.9 4.4
September 21, 2017Capital Markets Day 71
Income statement (IFRS)
EUR million 2016 2015
Revenue 2,363.3 2,373.1
Other operating income 5.1 7.1
Operating expenses -2,084.2 -2,116.4
Depreciations, amortizations and impairments -137.2 -131.2
Operating profit 147.0 132.6
Finance costs (net) -19.1 -30.8
Share of profit or loss of associates 0.1 0.3
Profit before tax 128.0 102.1
Income taxes -30.1 -24.9
Net profit for the period 97.9 77.2
Equity owners of the parent 91.8 71.0
Non-controlling interests 6.1 6.2
Earnings per share for net profit attributabe to the equity owners of the parent company
(EUR per share)
0.60 0.47
September 21, 2017Capital Markets Day 72
Balance sheet (IFRS)
EUR million 2016 2015
Goodwill* 522 518
Other intangible assets 116 135
Property, plant and equipment 916 815
Shares and other investments 268 357
Inventories* 217 207
Receivables 409 411
Cash and cash equivalents 173 152
Total assets 2,621 2,595
Equity 1 183 1 193
Interest-bearing liabilities 807 794
Interest-free liabilities 631 608
Total equity and liabilities 2,621 2,595
September 21, 2017Capital Markets Day 73
* Key audit matter
Cash Flow statement (IFRS)
EUR million 2016 2015
Net profit for the period 98 77
Total adjustments 187 189
Change in net working capital 29 21
Finance expenses -20 -27
Income taxes paid -23 -12
Net cash generated from operating activities 271 248
Purchases of subsidiaries and business acquisitions 2 -123
Capital expenditure -213 -182
Proceeds from sale of assets 37 3
Change in long-term loan receivables 1 0
Cash flow after investing activities 98 -54
September 21, 2017Capital Markets Day 74
Cash flow – profitability improvement is the main driver
• Cash flow from operations has
improved nicely 2011-2016
• Main driver for cash flow is profitability
target of 14-16% operative EBITDA
• Net Working Capital at good level,
around 8% of 2016 revenue
– BOOST expected to improve inventories,
revenue growth impacting NWC to other
direction
• No major change expected in Finance
expenses
• Taxes paid expected to increase
– Underlying tax rate 22-25%
EUR million 2016 2015
Operative EBITDA 303 287
Reported EBITDA 284 264
Change in NWC 29 21
Finance expenses -20 -27
Taxes paid -23 -12
Other items 1 2
Cash flow from operations 271 248
September 21, 2017Capital Markets Day 75
Kemira offers stable and competitive dividends
• Kemira’s dividend policy is to pay
a stable and competitive dividend
• Kemira has paid dividends every year
since listing of shares in 1994
• Kemira offers attractive dividend yield
– Average dividend yield in relevant indices
• EuroStoxx Chemicals 2.3%
• OMX Helsinki 25 3.5%
0.53 0.53 0.53 0.53 0.53 0.53
5.8% 4.5% 4.4% 5.4% 4.9% 4.4%
2011 2012 2013 2014 2015 2016
September 21, 2017Capital Markets Day 76
Dividend per share Dividend yield
Kemira’s dividend yield calculated using the share price at year-end
Addressing fixed and variable costs
Operating expenses in 2016
EUR 1.9 billion• Kemira is actively reducing its cost base
• New two segment structure and related
reorganization is purely addressing
fixed costs
– Savings target EUR 15-20 million
– Run-rate by end of 2017
• BOOST program, savings mostly in
logistic costs
– Savings target EUR 20-30 million
– Run-rate in 1-2 years
– In addition, inventory reduction target of
EUR 50 million
September 21, 2017Capital Markets Day 77
10% Electricity and energy
30% Fixed costs
45%Raw
materials
15% Logistics
Pulp & Paper – Technology and market leader
September 21, 2017Capital Markets Day 78
Value chain part covered by Kemira
RAW
MATERIALSINTERMEDIATES PRODUCTS APPLICATIONS
CUSTOMER
IDUSTRIESCUSTOMERS
Electricity
Sodium chloride
(salt)
Crude tall oil
Cationic monomer
Acrylonitrile
Acrylic acid
Olefins
Fatty acids
Maleic anhydride
Sulfur
Tall oil rosin
AKD Wax
Isomerized olefins
Acrylamide
Sodium chlorate
Hydrogen peroxide
Polymers
Defoamers
Coagulants
Biocides
Sizing
Strength Additives
Surface additives
Colorants
Sulfuric acid
Pulping
Bleaching
Retention
Wet-end process
control
WQQM
Sizing
Strength
Surface treatment
Coloring
Pulp
Packaging
and board
Printing
and writing
Tissue
All the major
global paper
and pulp
producers
Main competitors: BASF, Akzo Nobel, Solenis, Ecolab, SNF
Industry & Water – Technology and market leader in water treatment as well as in niche applications in oil & gas
September 21, 2017Capital Markets Day 79
RAW
MATERIALSINTERMEDIATES PRODUCTS APPLICATIONS SALES CHANNEL CUSTOMERS
Acrylonitrile
Acrylic acid
Sulfuric acid
Hydrochloric acid
Aluminium hydrate
Iron ore
Pickling liquor
Copperas
Various monomers
Acrylamide
Polymers (EPAM, DPAM)
Al Coagulants
Fe Coagulants
Dispersants &
antiscalants
Biocides
Emulsifiers
Defoamers
Formulations
Raw water & waste water treatment
Sludge treatment
Friction reduction
Enhanced oil
recovery
Tailings treatment
Mining processes
Direct sales
Distributor/reseller
Service companies
Municipalities
Private operators
Industrial customers
Pumpers
Oil & Gas operators
Service companies
Mine operators
Cationic monomer
Main competitors:
Coagulants: mainly local small companies, Feralco, USALCO
Polymers: SNF, Solvay, Ecolab, Solenis, BASF
Value chain part covered by Kemira
Kemira – largest shareholders and Board of Directors
Shareholders on August 31, 2017
% of shares
1. Oras Invest 18.2%
2. Solidium (owned by State of Finland) 16.7%
3. Varma Mutual Pension Insurance
Company
3.4%
4. Ilmarinen Mutual Pension Insurance
Comp.
2.3%
5. Kemira Oyj 1.9%
Total number of shares 155,342,557
Foreign ownership of shares 24.5%
Total number of shareholders 35,595
Kemira Board of Directors
September 21, 2017Capital Markets Day 80
Jari Paasikivi, Chairman
Member since 2012
Oras Invest Oy, CEO
Kerttu Tuomas
Vice Chairman
Member since 2010
Wolfgang Büchele
Member in 2009-
2012 and since 2014
Kaisa Hietala
Member since 2016
Timo Lappalainen
Member since 2014
Shirley Cunningham
Member since 2017
Kemira’s Management Board
September 21, 2017Capital Markets Day 81
Jukka Hakkila, Chief Legal Officer, acts as secretary of Management Board and Board of Directors
Pulp & Paper
Kim Poulsen
Operational
Excellence
Esa-Matti Puputti
Human Resources
Eeva Salonen
Industry & Water
Antti Salminen
CFO
Petri Castrén
CTO
Heidi Fagerholm
President and CEO
Jari Rosendal
Data about shale oil and gas industry
US rig count (quarterly avg) and oil price(WTI)
0
10
20
30
40
50
60
70
80
0
200
400
600
800
1000
1200
1400
1600
Q1/15 Q3/15 Q1/16 Q3/16 Q1/17
Frac stages in North America(source: IHS Markit)
0
100
200
300
400
500
600
700
800
900
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
September 21, 2017Capital Markets Day 82
Rig countOutlook
Oil price
September 21, 2017Capital Markets Day 83
Targets & Performance: Q2/2017CORPORATE RESPONSIBILITY UPDATE 1/2
Focus area Issue, KPI, target value Comments Status
Sustainable
products &
solutions
INNOVATION SALES
Share of innovation revenue
of total revenue, %
10% by the end of 2017
KPI reported quarterly
During Q2/2017 several new products or
solutions were commercialized and Kemira
expects to achieve the 10% target during
2017.
Responsibility
in our supply
chain
SUPPLIER MANAGEMENT
Number of onsite sustainability
audits for highest risk suppliers(with lowest sustainability assessment
score1)
5 suppliers audited every year
during 2016-2020, average
KPI reported annually
All earlier low-scored suppliers improved their
performance in re-assessments, and no new
high risk raw material suppliers were
detected. However, a few suppliers have
refused to take EcoVadis assessments this
year due to lack of resources or company
policies. Those will be audited in Q3 and Q4
2017.
Responsible
manufacturing
CLIMATE CHANGE
Carbon index
Kemira Carbon
Index ≤ 80 by end
of 2020 (2012 = 100)
KPI reported annually
Sourcing of low carbon energy continued
according to plan. As part of the E3 Plus
program, four Energy Review site visits were
performed during Q2 2017. The performed
energy reviews cover more than 90% of
Kemira’s total energy consumption.
5%7% 8% 8%
9% 9% 10%
2012 2013 2014 2015 2016 2017Q2
Target2017
4 4
25
2016 2017 Q2 Target 2020
10088 91 92 86 80
2012 2013 2014 2015 2016 Target2020
Behind target In progress Achieved
Behind target In progress Achieved
Behind target In progress Achieved
Focus area Issue, KPI, target value Comments Status
Responsibility
towards the
employees
OCCUPATIONAL HEALTH AND SAFETY
Number of Total Recordable Injury
Frequency (TRIF) (per million hours,
Kemira + contractor, year-to-date1)
Achieve zero injuries
(TRIF 2.0 by end of 2020)
KPI reported quarterly
Behaviour Based Safety (BBS) program pilots
moving ahead as planned, and next 10 sites
implementation starts in Q3 (YTD: 4). To
improve our contractor safety we have
launched Contractor Safety Program which is
looking contractor safety from contracting to
materialization of the contracted work.
EMPLOYEE ENGAGEMENT
Employee engagement index based
on Voices@Kemira biennial survey
The index at or above the external
industry norm
Participation rate in Voices@Kemira
75 % or above
KPI reported biennially
We aim to confirm the next Voices@Kemira
survey by Q4 2017.
LEADERSHIP DEVELOPMENT
Leadership development activities
provided, average
Two (2) leadership development
activities per people manager
position during 2016-20202
KPI reported annually
High level of activity continued, with 191
leadership development activities provided
during Q2 2017 (target: 75 per quarter).
September 21, 2017Capital Markets Day 84
Targets & Performance: Q2/2017CORPORATE RESPONSIBILITY UPDATE 2/2
Behind target In progress Achieved
Behind target In progress Achieved
Behind target In progress Achieved
70%58% 67%
84% 75%85%
2011 2013 2015
Engagement Participation
8.57.1
5.87.2
3.4 3.8
2012 2013 2014 2015 2016 2017Q2
494685
1500
2016 2017 Q2 Target 2020
1 The TRIF reporting has been changed to a year-to-date figure instead of 12 month rolling average that was previously used. 2 The cumulative amount of leadership development required to reach two (2) leadership development activities per people manager position during 2016-2020 equals 1500 leadership activities (when number of people manager
positions is 650-850). Development activities include job rotations, coaching and mentoring, and development programs.