Kongsberg Gruppen Asa · OSL:KOG
Kongsberg Gruppen Asa — Investor Presentation (November 2020)
19 slides from Kongsberg Gruppen Asa's investor presentation, Nov 12, 2020
Slide 1: Positioned for tomorrow
Positioned for tomorrow 12/11/2020 Gyrid Skalleberg Ingerø, Group Executive Vice President & CFO KONGSBERG PROPRIETARY: This document contains KONGSBERG information which is proprietary and confidential. Any disclosure, copying, distribution or use is prohibited if not otherwise explicitly agreed wi
Slide 2: Disclaimer
DISCLAIMER This presentation contains certain forward-looking information and statements. Such forward-looking information and statements are based on the current, estimates and projections of the Company or assumptions based on information currently available to the Company. Such forward-looking in
Slide 3: Solid revenue and EBITDA growth
Solid revenue and EBITDA growth Including acquired -and excluding divested companies Revenue development 2015 – LTM Q3 2020 EBITDA margin development 2015 – LTM Q3 2020 BNOK 26.4 20% 23.2 19.0% 18% 8.4 16% 7.2 14% 16.5 15.3 12% 14.0 13.8 11.8% 10% 5.8 8.5% 6.3 6.1 8% 6.3 17.3 6% 15.2 9.2 4% 7.5 6.4
Slide 4: Improved return on capital
Improved return on capital ROACE (%) and AVERAGE CAPITAL EMPLOYED (BNOK) ▪ Patria investment and Commercial Marine (CM) acquisition drive capital employed 33.6% ‒ Acquisition of CM fully reflected in capital 18.1% employed as of LTM Q3 2020 9.9% 14.1% 10.1% 10.0% ▪ Increased ROACE driven by profitab
Slide 5: Solid backlog
Solid backlog Backlog development (BNOK) ▪ Backlog “Next year” increased compared to 33.3 31.7 last year 12.7 10.7 ▪ Approximately 2/3 of backlog related to defence projects 17.0 ▪ Backlog does not include; 5.0 14.0 14.8 ‒ framework agreements 8.3 ‒ majority of aftermarket in KM 3.7 6.6 6.3 ‒ associ
Slide 6: Updated ambitions towards 2022
Updated ambitions towards 2022 Revenue target towards 2022 (BNOK) Target EBITDA margin 2022 (%) Updates compared to CMD 2019 > 30 > 13% • EBITDA target updated to include KONGSBERG MARITIME IFRS16 • All target adjusted up with 2%p > 16% 24 > 14% KONGSBERG • Hydroid sold in March 2020 DEFENCE & KONGS
Slide 7: Priorities towards 2022
Priorities towards 2022 KONGSBERG KONGSBERG KONGSBERG MARITIME DEFENCE & AEROSPACE DIGITAL 1. Key success Adapt to changing market Growth/ramp-up Scale factor Efficiency focus 2. Profitability and Benefit on scale and cost focus SaaS business model product harmonisation New opportunities and execute
Slide 8: Net working capital
Net working capital KONGSBERG MARITIME BNOK 20% 2.5 17% • Net working capital largely driven by project mix 2.0 13% • Net working capital expected to fluctuate going 1.5 9% 9% 6% forward 1.0 1.9 1.6 0.5 1.4 0.9 0.9 • Net working capital adjusted for acquired and 0.7 0.0 divested companies 2015 2016
Slide 9: Cash, debt and bond maturity profile
Cash, debt and bond maturity profile Cash and Interest bearing debt (BNOK) Bond maturity profile BNOK BNOK 1.50 10.0 1.5 2.0 KOG12 1.00 5.0 10.0 1.0 5.7 6.1 1.8 1.9 3.0 0.50 0.0 0.5 KOG08 0.45 KOG09 0.9 4.1 3.3 4.3 4.1 3.5 KOG11 KOG13 -5.0 0.0 2015 2016 2017 2018 2019 Q3 2020 2021 2022 2023 2024 202
Slide 10: Leverage ratio and capital structure target
Leverage ratio and capital structure target 2.5 2.2 Net debt/EBITDA of 1.0x +/- 1.0 securing; 2.0 ▪ Access to funding 1.5 ‒ Investment grade credit rating equivalent securing 1.0 Target access to debt capital markets 0.4 0.5 ▪ Customer confidence 0.0 ‒ Long-term view in strategy and execution (0.6)
Slide 11: Technology development securing our positions
Technology development securing our positions Self-funded R&D ex. Product maintenance by business area 2013 – LTM 2020 5.0% 5.4% 5.0% 6.7% 5.9% 5.6% 4.2% 4.2% ▪ Invest for the future and secure #1 1.11 1.06 position 0.98 0.14 0.90 0.18 0.81 0.85 0.85 0.78 0.14 0.23 ▪ Benefit from customer funded R&D
Slide 12: Benefiting from civilian R&D support scheme
Benefiting from civilian R&D support scheme Committed funding as of 2020… …results on sustainable products and solutions WORLD CLASS – Through people, technology and dedication KONGSBERG PROPRIETARY - See Statement of Proprietary information 12
Slide 13: Aligning dividend policy with financial strategy
Aligning dividend policy with financial strategy Historical Pay-out Ratio (%) Shareholder Remuneration (NOK) Total dividend Ordinary dividend NOK Increased # of % 276% shares due to equity 13.61 280 130% 14 issue 1.11 SBB PS 12 120 103% 10 9.25 100 93% 81% 8 10.00 Additional DPS 80 57% 58% 5.25 5.00
Slide 14: Active management of business portfolio
Active management of business portfolio 2016 2019 2019 2020 PATRIA OYJ. R-R COMMERCIAL MARINE AIM NORWAY HYDROID INC. • Acquired 49.9% from the state of • Acquired 100% from Rolls Royce • Acquired from Norwegian • Sold 100% to Huntington Ingalls Finland Ministry of Defence (sold 49.9% Industries in
Slide 15: Patria and AIM Norway
Patria and AIM Norway Important part of KONGSBERG’s MRO strategy ▪ Patria ▪ AIM Norway ▪ Prime MRO provider for the Finnish Defence Forces ▪ Premier MRO provider for the Norwegian armed aircrafts ▪ Supplier of strategically important products and systems to and helicopters Finland and other nations
Slide 16: Rolls Royce Commercial Marine
Rolls Royce Commercial Marine Significant synergies Acquisition and integration costs Target 500 MNOK annual cost synergies 5.439 508 61 130 194 90 429 422 444 375 83 135 290 150 690 4.865 253 72 418 160 292 294 272 1 587 319 4.865 181 130 130 189 Q2 2019 Q3 2019 Q4 2019 Q1 2020 Q2 2020 Q3 2020 Q1 2
Slide 17: Hydroid
Hydroid Solid return on investment ▪ Acquired in 2008 for ~81 USDm ▪ Sold in March 2020 for ~350 USDm ‒ Implied EV/EBITDA multiple of 24x ▪ Pre tax IRR on investment of 15.2% (estimated ~12.8% including tax) Cashflow from Hydroid (USDm) 350 40 (81) 2008 Acc. Cf 2009-2019 2020 WORLD CLASS – Through p
Slide 18: Positioned for tomorrow
POSITIONED FOR TOMORROW Growth Profitability Portfolio management • Deliver backlog and • Scale and project • Active management secure pipeline execution of business portfolio • Frontrunner new • Adapt to changing technology markets WORLD CLASS – Through people, technology and dedication KONGSBERG P
Slide 19: KONGSBERG PROPRIETARY - See Statement of Proprietary information
KONGSBERG PROPRIETARY - See Statement of Proprietary information
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