10/26/2021

Strategy and business model

Kemira strategy towards 2030

Sustainability transformation driving profitable growth – by 2030 over 500 million of our revenue will come from bio-based product portfolio.



Kemira will become the leading provider of sustainable chemical solutions for water-intensive industries



We enable more sustainable processes and products for our customers



We aim for
long-term growth



We continue to drive profitability and operational excellence

RESILIENT BUSINESS MODEL

Kemira has a resilient business model that is supported by a well-diversified customer base.

Length of contracts:

  • In Pulp & Paper, 95% of contracts are 1-year or longer
  • In Industry & Water, 70% of contracts are 1-year or longer

Fixed pricing:
Around 70% of Kemira’s contracts have fixed pricing for a certain period of time. Around 30% of contracts have formula (pricing tied to e.g. the price of electricity) or spot-based pricing.

Customer concentration: Kemira has around 5,000 customers with the largest single customer accounting for 5% of revenue. 50 largest customers account for around 50% of revenue.

STRONG PROFITABILITY IMPROVEMENT STORY

In recent years, one of Kemira’s key strategic focus areas has been to improve profitability. Proactive action have been taken on three fronts: improving customer profitability (e.g. customer-level reporting and pricing actions), efficiency of operations (e.g. investments in backward integration and cost savings actions) and simplification of product portfolio and product mix.

As a result, Kemira’s margins have improved clearly. Kemira updated its financial targets in November 2020 and increased its operative EBITDA margin target to 15-18% (previously 15-17%).

 

Strengthening the foundation and improving profitability

 

Increasing focus on growth

After several years of focusing on profitability improvement, Kemira is placing stronger emphasis on profitable growth. Growth is increasingly expected to come from water treatment applications (organically or inorganically) as well as from biobased products.

Sustainability and biobased products playing an increasingly important role for Kemira’s future growth

Kemira aims to expand its biobased product portfolio clearly to reach EUR 500 million in revenue by 2030. Several partnerships have been announced, one with Danimer to develop biobased barrier coatings applications and one with International Flavors and Fragrances to commercialize their sugar-based raw material for Kemira’s end-market applications.