Borregaard ASA Capital Markets Day Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Magnus Rasmussen - SEB - Analyst : Thank you. I would also highlight that the audience has the opportunity to raise their hand and be given a microphone to ask a question. But I guess we can kick off in terms of your specialization strategy, is it more about shifting volumes from less specialized to more specialized products REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. SEPTEMBER 18, 2024 / 7:00AM, BRGB.OL - Borregaard ASA Capital Markets Day or developing new specialized products? So the 800 products today, is that 1000 products in 2030 or is it 600, because you have excluded the less specialized ones?

Question: Magnus Rasmussen - SEB - Analyst : You showed an example which is quite typical for Borregaard, I guess with the dishwasher tablets and lignobrite as an alternative to the oil based polyacrylate. You said that you have the same performance but are more sustainable. How do you work on pricing strategy here? Have you seen any change in customers willingness to pay for more sustainable products over the last couple of years? And also how are you on costs relative to oil based competitors? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. SEPTEMBER 18, 2024 / 7:00AM, BRGB.OL - Borregaard ASA Capital Markets Day Tom Foss-Jacobsen - Borregaard ASA - Executive Vice President - BioSolutions I think definitely we see a change in customers mindset about sustainability, compared to some years back, we also see that there's a strong drive for replacements like this. We, definitely see this product as part of our specialties, high value products. We are we have launched product if we're now going into the commercial stage. But the pricing and value is based on the value we're offering into that market. And it's definitely in the typical way, what we define our higher end applications

Question: Magnus Rasmussen - SEB - Analyst : Okay. In terms of the Asian opportunities, would you say that it's more about pushing products which are already further in terms of application in Europe or is it more about growing in the newer product niches and lithium batteries and these are sort some of things? Tom Foss-Jacobsen - Borregaard ASA - Executive Vice President - BioSolutions I think it's both, of course agriculture is big in Asia as well as I mean, we have strong foothold globally in Europe, in North America, South America and Asia. But the growth is of course very interesting in these countries in Asia. But then if you look at the batteries, that's of course a different sector where you see that they are also dominant in developing these technologies. So that could be a little bit different, with new innovations as well.

Question: Magnus Rasmussen - SEB - Analyst : I believe you have about a quarter of your sales to Asia today. Correct me if I'm wrong. Is that share higher in the lignin business than the rest of the business?

Question: Magnus Rasmussen - SEB - Analyst : I think that if there are no further questions from the audience, I think that concludes the Q&A session, the first Q&A session and we will have half an hour break and then we will be back at the hall.

Question: Magnus Rasmussen - SEB - Analyst : Thank you. (break) PRESENTATION

Question: Magnus Rasmussen - SEB - Analyst : Thank you for the presentations. If we can start with the question on biomaterials. So margins have been a bit lower in 2024. But it seems you're making progress on Ice Bear and GP has closed some capacity. Are you more or less confident on long term margins now than you were one year ago when you delivered higher margins and you also had these other developments?

Question: Magnus Rasmussen - SEB - Analyst : And we've seen you to some extent at Q2 and also one of our key competitors sending out the message that prices will be increased. Will we see prices and margins recovering next year?

Question: Magnus Rasmussen - SEB - Analyst : A question on the debottlenecking projects. You say 5% to 10% increase seems like it's across the different product groups on the Sarpsborg facility. Can you just briefly elaborate on what that means at a group level because there are other plants as well?

Question: Magnus Rasmussen - SEB - Analyst : And how confident are you that you will be able to deploy this extra volume as let's say, more specialized types of products, fairly quickly after they are -- after it's ready.

Question: Magnus Rasmussen - SEB - Analyst : You have, delivered 18% -- more than 18% return on capital employed for the past couple of years. 2024 looks quite good as well. You have a 15% target. It seems throughout the day here that you are aiming for further improvements. So why not raise the target to 20%?

Question: Magnus Rasmussen - SEB - Analyst : I think we have a question somewhere. Unidentified Participant Thank you. I'm (inaudible) with the Prof Fund. I just have a question about the bio based start ups. And I appreciate you staying long term. But, could you try to be more specific about, I mean, is it 20, 30 or 35 or 28 or just be a little bit more specific? And, could you also shed some light on I mean, obviously investing in these companies is interesting, but I guess there are also some business to -- the speciality, I assume you're going to refine the products further. So how much do we expect to be kind of in house work or, and how much will be outside? I mean, where, where do you see the most potential? Is it further developing the -- what these companies are producing or is it investing in these companies? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. SEPTEMBER 18, 2024 / 7:00AM, BRGB.OL - Borregaard ASA Capital Markets Day

Question: Magnus Rasmussen - SEB - Analyst : If I can follow up on the strategy behind these start ups. I mean, what's your long term ambition in terms of ownership stakes? I mean, do you -- are you here to invest in these companies and then help them along and then sell them or are you here to be a very long term shareholder and sort of they become a part of world wide?

Question: Magnus Rasmussen - SEB - Analyst : Yeah, I think you mentioned R&D development spend of 3% of revenues. I think that was for last year. It seems to be quite well in line with your expansion investments beyond the bottlenecking project, is that sort of a sensible level to think about long term?

Question: Magnus Rasmussen - SEB - Analyst : I think we have another question from the audience.

Question: Magnus Rasmussen - SEB - Analyst : I think that concludes today's presentations. So thank you so much to everyone who presented and also those who showed up in the audience and contributed with questions.