Interpump Group S.p.a. · MIL:IP
Interpump — Q1 2024 Earnings Presentation
59 slides from Interpump's earnings presentation, May 2024
Slide 1: Interpump Group May 2024
INTERPUMP GROUP May 2024
Slide 2: Index
INDEX ▪• GROUP OVERVIEW KEY HIGHLIGHTS ▪• 2024 4Q-2023 PRELIMINARY FINANCIAL RESULTS OUTLOOK ▪• 1Q2024 GROUP SUSTAINABILITY PATH FINANCIAL RESULTS ▪• ESG OUTLOOK PATH ▪• ANNEX ANNEX 1
Slide 3: Index
INDEX ▪• GROUP OVERVIEW KEY HIGHLIGHTS • 4Q-2023 PRELIMINARY FINANCIAL RESULTS • GROUP SUSTAINABILITY PATH • OUTLOOK • ANNEX 2
Slide 4: Interpump a Delivering Group
3Q-3Q2023YTD INTERPUMP A DELIVERING GROUP ▪ € 2.240m of turnover and € 536m of EBITDA (24% on net sales) in 2023 divided between two divisions − Hydraulics and Water Jetting ▪ Hydraulics: around 75% of Group sales, EBITDA margin around 22% − Wide range of components for mobile and non-mobile hydraul
Slide 5: Excellence Track Record
2023 INTERPUMP A DELIVERING GROUP – EXCELLENCE TRACK RECORD ▪ Since IPO in 1996 a track record of excellence and GROUP 1996-2023 SALES EVOLUTION (€ million) resilience ▪ Sales: only 4 years of decrease driven by strategic 2020: COVID crisis Sales: -5.4% activities review (1) or extraordinary externa
Slide 6: Excellence Track Record – FCF
2023 2024 A DELIVERING GROUP – EXCELLENCE TRACK RECORD ▪ FCF: growing generation and consistent GROUP 1996-2023 FCF EVOLUTION (€ million) exploitation in worsening environment – EBITDA excellence and resilience 250.0 – TWC proactive management 200.0 • Customer quality 150.0 • Tactical supply chain a
Slide 7: Sales Diversification
ANNEX INTERPUMP A DELIVERING GROUP – SALES DIVERSIFICATION GROUP 2023 sales: € 2.240m PACIFIC AREA: 11% OTHERS: 1% EARTH MOVING MACHINE: 8% GENERIC DEALERS: 16% CONSTRUCTION: 8% REST of THE WORLD: 9% CLEANING: 5% AGRICOLTURE: 10% GENERIC CONTRACTORS: 3% EUROPE: 52% OTHER INDUSTRIAL SECTOR: 8% LIFT:
Slide 8: Market Diversification
3Q-3Q2023YTD INTERPUMP A DELIVERING GROUP – MARKET DIVERSIFICATION WATER JETTING HYDRAULICS HIGH PRESSURE PUMPS DEVICES FLOW HANDLING COMPONENTS & SYSTEMS • Power take-offs, cylinders, hydraulic motors & gear • Piston pumps 1-2,000hP used in • Stainless steel agitators, mixers, pumps, valves high-pr
Slide 9: Application Diversification
3Q-3Q2023YTD INTERPUMP A DELIVERING GROUP – APPLICATION DIVERSIFICATION HYDRAULICS WATER JETTING TRUCK OUTFITTERS FOOD, COSMETICS (1) AUTOMOTIVE EARTH MOVING Tipping trucks High-pressure homogenizers Rail engine heads deburring Excavators Trash collection Water-jet food cutting, Bodywork cutting Bac
Slide 10: Brand & Product Diversification
3Q-3Q2023YTD INTERPUMP A DELIVERING GROUP – BRAND&PRODUCT DIVERSIFICATION WATER JETTING HYDRAULICS HIGH PRESSURE PUMPS FLOW HANDLING COMPONENTS DEVICES & SYSTEMS INTERPUMP INTERPUMP HYDRAULICS WALVOIL – WHITE - EUROFLUID PRATISSOLI BERTOLI MUNCIE POWER Directional control valves, High flow/pressure
Slide 11: Strategy Milestones
3Q-3Q2023YTD INTERPUMP A DELIVERING GROUP – STRATEGY MILESTONES FLEXIBILITY • Vertically integrates manufacturing DIVERSIFICATION (wherever possible) Product mix and sales strategy • Across the widest possible range • Use of general-purpose programmable of applications, products, can adapt fast to m
Slide 12: Strategy Milestones
3Q-3Q2023YTD INTERPUMP A DELIVERING GROUP – STRATEGY MILESTONES Volatility reduction through multiple cycles exposure Effective reaction to unexpected swings FLEXIBILITY • Vertically integrates manufacturing DIVERSIFICATION (wherever possible) Product mix and sales strategy • Across the widest possi
Slide 13: 2023-25 Group Commitments
3Q-3Q2023YTD INTERPUMP A DELIVERING GROUP – 2023-25 GROUP COMMITMENTS ▪ 2023-25 commitments, 1 target with 2 guidelines (1) 2022-25 GROUP EXPECTED SALES EVOLUTION (1) 3,500 2022-2025 sales growth: +25% ▪ One target: sales 3,000 – around 25% of total growth(2) 2,500 2,000 ▪ Two guidelines: profitabil
Slide 14: Index
INDEX ▪• GROUP OVERVIEW KEY HIGHLIGHTS ▪• 2024 4Q-2023 PRELIMINARY FINANCIAL RESULTS OUTLOOK • GROUP SUSTAINABILITY PATH • OUTLOOK • ANNEX 13
Slide 15: Consistent Growth Strategy in a Mixed Environment
2024 CONSISTENT GROWTH STRATEGY IN A MIXED EVIRONMENT ▪ Enhancement of Group’s network presence GROUP EVOLUTION IN «HOSES, PIPES & FITTINGS» (1) Sales and EBITDA margin – Water Jetting: 3rd step in Flow Processing in less GS-HYDRO TUBIFLEX TEKNO TUBI than one year ~ € 23m of sales ˃ € 11m of sales ~
Slide 16: Updating 2024 Financial Expectations
2024 CONSISTENT GROWTH STRATEGY IN A MIXED EVIRONMENT ▪ Updating 2024 financial expectations updating ▪ Sales: between -5% and +1% overall (1) – Impact of 2023 acquisitions: January-March for Mouldtech and January-April for I.Mec and Waikato – Impact of 2024 acquisitions: from April for Process Part
Slide 17: Margin Protection & FCF Exploitation Track Record
2024 MARGIN PROTECTION & FCF EXPLOITATION TRACK RECORD 2009 & 2020 SALES, EBITDA & FCF EVOLUTION (1) % change compared to previous reporting period 200% 185.3% 150% 100% 63.2% 50% 2009 2020 0% -12.6% -13.6% -50% -29.7% -48.4% Sales EBITDA FCF 2 2 GROUP 2019-2021 COGS, LABOUR COST GROUP 2019-2021 SAL
Slide 18: Index
INDEX ▪• GROUP OVERVIEW KEY HIGHLIGHTS ▪• 2024 4Q-2023 PRELIMINARY FINANCIAL RESULTS OUTLOOK ▪• 1Q2024 GROUP SUSTAINABILITY PATH FINANCIAL RESULTS • OUTLOOK • ANNEX 17
Slide 19: 1Q2024 Towards Margin Protection & Cash Improvement Targets
1Q2024 TOWARDS MARGIN PROTECTION & CASH IMPROVEMENT TARGETS ▪ On the right path to the goals of margin protection 2024 SALES, EBITDA & FCF EVOLUTION (2-3) % change compared to previous reporting period and FCF generation improvement 160% 142.2% ‒ Effective margin protection 140% 120% • Organic sales
Slide 20: 1Q2024 Group – Effective Margin Protection
1Q2024 GROUP – EFFECTIVE MARGIN PROTECTION ▪ 1Q2024 – Sales: normalisation trend exacerbated by comparison with best 1Quarter in Group history – Profitability: effective margin protection thanks to division diversification and business model flexibility – NFP: delivering improvement in cash flow gen
Slide 21: 1Q2024 Divisions – Consistency with Division Features
1Q2024 DIVISIONS – CONSISTENCY WITH DIVISION FEATURES ▪ Hydraulics – Sales: “agriculture” and “earth-moving machinery” in a stabilisation phase – EBITDA: countermeasures gradually kicking in ▪ Water-Jetting – Sales: “complete system” and “pressure pump” best performer among most important categories
Slide 22: 1Q2024 Sales – Normalisation and Comparison
1Q2024 SALES – NORMALISATION AND COMPARISON ▪ 1Q2024: Hydraulics more impacted by normalisation, 1Q2024 GROUP SALES EVOLUTION Water Jetting more influenced by comparison – Hydraulics: “orbital motors" and “power -7.8% transmission” the weakest, “hoses, pipes & fittings» € 592m -9.2% and «PTO & cylin
Slide 23: 1Q2024 NFP – Balancing Cash Improvement and Growth
1Q2024 NFP – BALANCING CASH IMPROVEMENT AND GROWTH ▪ January: US$300m Private Shelf agreement NFP EVOLUTION (1) (€ m) ‒ US$100 single tranche issued • 8 years average duration and 4.17% coupon € 486m € 34m € 3m € 0m € 0m € 3m € 0m € 453m • Gross debt average life from 2.5 to 3 years ▪ March: NFP of
Slide 24: 1Q2024 NFP – CAPEX – Last Important Project
1Q2024 NFP – CAPEX – LAST IMPORTANT PROJECT ▪ New Interpump Hydraulics headquarter – 62,000 sq. metres, a total area increase of around 30% – Best environmental standards • Photovoltaic plants with an estimated 2,300,000 kWh annual production and consequently 1.219 Tco2 savings • 10x better thermal
Slide 25: Index
INDEX ▪• GROUP OVERVIEW KEY HIGHLIGHTS ▪• 2024 4Q-2023 PRELIMINARY FINANCIAL RESULTS OUTLOOK ▪• 1Q2024 GROUP SUSTAINABILITY PATH FINANCIAL RESULTS ▪• ESG OUTLOOK PATH • ANNEX 24
Slide 26: ESG Path Concreteness
ESG PATH CONCRETENESS “A falling tree makes more noise than a growing forest” Lao Tzu 25
Slide 27: ESG Path Three Priorities for Three Pillars
ESG PATH THREE PRIORITIES FOR THREE PILLARS SUPPORTED GRI 2023-2025 KEY TARGETS and SDG ▪ Definition of Group “Carbon neutrality” strategy 2023 E ▪ Reduction of Group “Carbon intensity” 2025 ▪ Increase of renewed electricity consumption 2025 305-1 and 2 302-1 ▪ Injury rate improvement 2024 S ▪ ESG s
Slide 28: ESG Path a Delivering Group
ESG PATH A DELIVERING GROUP ▪ All 2023 ESG Plan actions delivered – Building Group ESG foundation ▪ Multi annual actions delivery duly on going – Leading to 2023 and 2050 decarbonisation target ▪ Group ESG methodological approach improvements – Higher number of Group companies included in the sample
Slide 29: ESG Path a Delivering Group
3Q2023YTD ESG PATH A DELIVERING GROUP ANALYSIS AND MEASUREMENT BUILDING GROUP LEADING TO ESG FOUNDATIONS 2030 AND 2050 DECARBONISATION TARGETS 2022 2023 2024 2025 2027 • E.1 - Carbon neutrality strategy • E.2 - Carbon intensity reduction • E.4 - Circular economy (phase 1) • E.3 - Increase of renewab
Slide 30: 2023-2025 ESG Journey – 2024 Actions Updatings
3Q2023YTD ESG PATH A DELIVERING GROUP 2023-2025 ESG JOURNEY 2024 ACTIONS UPDATINGS E.7 Product ECO-design S.1 Injury rate improvement S.6 ESG supply chain evaluation model extension Tax compliance consolidation G.4 in line with best practices G.5 (1) GR1 207-4 information updating G.6 (1) Updating o
Slide 31: Index
INDEX ▪• GROUP OVERVIEW KEY HIGHLIGHTS ▪• 2024 4Q-2023 PRELIMINARY FINANCIAL RESULTS OUTLOOK ▪• 1Q2024 GROUP SUSTAINABILITY PATH FINANCIAL RESULTS ▪• ESG OUTLOOK PATH ▪• ANNEX ANNEX 30
Slide 32: Annex Disclaimer
ANNEX ANNEX DISCLAIMER 31
Slide 33: Disclaimer – Performance Indicators
ANNEX ANNEX DISCLAIMER − PERFORMANCE INDICATORS The Group uses several alternative measures that are not identified as accounting parameters in the framework of the IFRS standards in order to allow the trend of economic operations and the Group's financial position to be better evaluated. Such indic
Slide 34: Disclaimer – Forward Looking Statements
ANNEX DISCLAIMER – FORWARD LOOKING STATEMENTS This document has been prepared by Interpump Group S.p.A for not constitute an offer to sell or a solicitation to buy or subscribe to use during meetings with investors and financial analysts and is Company shares. Neither this document nor a portion the
Slide 35: 1Q2024
ANNEX 1Q2024 34
Slide 36: 1Q2024 – Sales Details – Organic Evolution
ANNEX 1Q2024 – SALES DETAILS – ORGANIC EVOLUTION GROUP 2020-2024 ORGANIC GROWTH EVOLUTION by QUARTER 50% 39.4% 2020: -12.6% - 2021: +20.1% - 2022: +13.7% 40% 2023: +6.9% - 2024YTD: -9.2% 30% 17.9% 20% 15.7% 18.7% 14.2% 11.6% 14% 10% 12.5% 9.1% 12.6% 4% 0% -3.4% -10% -1.7% -11.2% -9.2% -16.2% -20% -3
Slide 37: 2023
ANNEX ANNEX 2023 36
Slide 38: 2023 – Sales Details – Breakdown – Group
ANNEX 2023 – SALES DETAILS – BREAKDOWN – GROUP (1) GROUP 2023 sales: € 2,240m PACIFIC AREA: 11% OTHERS: 1% EARTH MOVING MACHINE: 8% GENERIC DEALERS: 16% CONSTRUCTION: 8% REST of THE WORLD: 9% CLEANING : 5% AGRICOLTURE : 10% GENERIC CONTRACTORS: 3% EUROPE: 52% OTHER INDUSTRIAL SECTOR: 8% LIFT: 7% STE
Slide 39: 2023 – Sales Details – Breakdown – Hydraulics
ANNEX 2023 – SALES DETAILS – BREAKDOWN – HYDRAULICS (1) HYDRAULICS 2023 sales: € 1,634m OTHERS: 1% PACIFIC AREA: 10% EARTH MOVING MACHINE: 11% GENERIC DEALERS: 18% REST of THE WORLD: 9% CONSTRUCTION: 8% OTHER INDUSTRIAL SECTOR: 9% AGRICOLTURE : 14% F&B: 1% ENERGY&UTILITIES: 1% MINING: 1% SHIPYARD-MA
Slide 40: 2023 – Sales Details – Breakdown – Water Jetting
ANNEX 2023 – SALES DETAILS – BREAKDOWN – WATER JETTING (1) WATER JETTING 2023 sales: € 606m PACIFIC AREA: 13% OTHERS: 1% CONSTRUCTION: 8% GENERIC DEALERS: 11% ADAPTORS INDUSTRIAL VEHICLES: 4% AUTOMOTIVE: 4% REST of THE WORLD: 11% SHIPYARD-MARINE: 3% CLEANING: 17% OIL&GAS: 4% RAILWAY: 1% ENERGY&UTILI
Slide 41: ESG Path
ANNEX ESG PATH Please (1) Pleaserefers referstotoGroup Groupweb website sitefor forspecific specificdocumentation documentationononthe thetopic topic(“2023 (“2023ESG ESGActions Overview”, Activities 12 January Overview”, 2024) 12 January 2024) 40
Slide 42: ESG 2023-25 Plan – Climate Change
ANNEX ESG 2023-25 PLAN – LEADING TO 2030-50 TARGETS E ▪ 3 main streams – Climate change – Product life cycle – Water efficiency ▪ Formalisation of Group “E” strategy and policies is the cornerstone ▪ Approximately € 10m of CAPEX and not material impact on Group G&A in the plan horizon – CAPEX: aroun
Slide 43: ESG 2023-25 Plan – Climate Change, Product Life Cycle
ANNEX ESG 2023-25 PLAN – LEADING TO 2030-50 TARGETS E ACTION ID DESCRIPTION GRI and SDG KPI TIMING K.P.I. Carbon intensity reduction tCO2eq/€ (1) ▪ Focus on Scope 1 and 2 Base year: 2021 E.2 ▪ Main leverages: photovoltaic plants installation Target: -30% Target year: 2025 and renewable purchase ener
Slide 44: ESG 2023-25 Plan – Water Efficiency
ANNEX ESG 2023-25 PLAN – LEADING TO 2030-50 TARGETS E ACTION ID DESCRIPTION GRI and SDG KPI TIMING WATER EFFICIENCY Water monitoring system ▪ Phase 1: mapping of the installed water Base year: 2022 E.6 monitoring systems across the Group N.A. Target year: 2025 ▪ Phase 2: implementation of a continuo
Slide 45: ESG 2023-25 Plan – Health & Safety
ANNEX ESG 2023-25 PLAN – EXPANDING THE SILENT GROWING FOREST S ▪ 4 main streams – Health & safety – People development – Responsible supply chain – Diversity & inclusion ▪ “Pilot projects” will be crucial to capitalise on already existing best practices at subsidiaries level – Walvoil for “ESG suppl
Slide 46: ESG 2023-25 Plan – People Development
ANNEX ESG 2023-25 PLAN – EXPANDING THE SILENT GROWING FOREST S ACTION ID DESCRIPTION GRI and SDG KPI TIMING HEALTH & SAFETY K.P.I. % Group turnover ISO 45001 extension Base year: 2021 S.2 ▪ Focus on subsidiaries with manufacturing sites Target year: 2027 Base: 22% Target: 45% K.P.I. Increase of non-
Slide 47: ESG 2023-25 Plan – Responsible Supply Chain
ANNEX ESG 2023-25 PLAN – EXPANDING THE SILENT GROWING FOREST S ACTION ID DESCRIPTION GRI and SDG KPI TIMING RESPONSABLE SUPPLY CHAIN ESG supply chain evaluation model extension ▪ First focus on Italy (100% of manufacturing Base year: 2023 S.6 N.A. subsidiaries) Target year: 2024 ▪ Feasibility study
Slide 48: ESG 2023-25 Plan – ESG Cornerstone
ANNEX ESG 2023-25 PLAN – BUILDING ESG FOUNDATIONS G ▪ 3 main streams – ESG as governance cornerstone – Spread of ESG principles, actions and results inside and outside the Group – Tax compliance consolidation in line with best practices ▪ “G” actions will follow the natural path of Group governance
Slide 49: ESG 2023-25 Plan – ESG Principles-Actions-Results
ANNEX ESG 2023-25 PLAN – BUILDING ESG FOUNDATIONS G ACTION ID DESCRIPTION GRI and SDG KPI TIMING ESG PRINCIPLES-ACTIONS-RESULTS Code of Ethics revision Base year: 2022 G.2 N.A. Target year: ▪ To reflect ESG principles in Code of Ethics 1H2023 SPREAD Succession plan formalization G.3 ▪ Succession pla
Slide 50: ESG 2023-25 Plan – ESG Principles-Actions-Results
ANNEX ESG 2023-25 PLAN – BUILDING ESG FOUNDATIONS G ACTION ID DESCRIPTION GRI and SDG KPI TIMING ESG PRINCIPLES-ACTIONS- RESULTS SPREAD Base year: 2022 Updating on ESG journey G.6 N.A. Target year: ▪ Periodic updating on actions implementation annual 49
Slide 51: 2023 Actions – E.1 Decarbonisation Strategy
ANNEX 2023 ACTIONS – E.1 DECARBONISATION STRATEGY E ▪ “2023-32 Decarbonisation Strategy” targets 2 goals 2025 REDUCTION TARGET(1) (tCO2e) – Achievement of Group 2025 Emission reduction target 100,000 90,000 – Enhancement of “2030 Emission reduction target” (1) 80,000 70,000 90.286 78.922 -13% road m
Slide 52: 2023 Actions – E.4 Circular Economy
ANNEX 2023 ACTIONS – E.4 CIRCULAR ECONOMY E ▪ Circular Economy, phase 1 – Activities: waste assessment, potential by-products analysis and network with partners at regional level – Levers: pilot projects ▪ Waste assessment activities performed in 2023 allowed to finetune Group companies involved in
Slide 53: 2023 Actions – S.5 ESG Supply Chain Evaluation Model
ANNEX 2023 ACTIONS - S.5 ESG SUPPLY CHAIN EVALUATION MODEL S ▪ Another action to be delivered through pilot project – Walvoil the Group company involved – 2 steps • Updated suppliers’ evaluation model with environmental and social criteria • Initial focus on “material” suppliers 2022 Walvoil supplie
Slide 54: 2023 Actions – G.1 ESG Board Committee Establishment
ANNEX 2023 ACTIONS – G.1. ESG BOARD COMMITTEE ESTABLISHMENT G ▪ April 2023, new Group Board ‒ Sustainability Committee appointment, with Group CEO as a member ‒ Separation between Chairman and CEO role INTERPUMP GROUP BOARD Chairperson: F. Montipò Deputy Chairperson: G. Tamburi Chief Executive Offic
Slide 55: 2023 Actions – G.2 New Ethics Code
ANNEX 2023 ACTIONS – G.2 NEW ETHICS CODE G ▪ New Code of Ethics − To reflect Group Sustainability commitments undertaken with 2023-25 ESG Journey ▪ Sustainability commitments − E: sustainable growth and reduction of environmental impacts − S: human & labor rights protection and skills & knowledge de
Slide 56: 2023 Actions – G.2 New Ethics Code
ANNEX 2023 ACTIONS – G.2 NEW ETHICS CODE G PREVIOUS CODE OF ETHICS UPDATED CODE OF ETHICS Stakeholders, i.e. those categories of individuals, groups or institutions whose contribution is required to achieve the mission of Interpump and who have significant interests gravitating around the company's
Slide 57: 2023 Actions – G.3 Succession Plan Formalisation
ANNEX 2023 ACTIONS - G.3 SUCCESSION PLAN FORMALISATION G ▪ Interpump Succession Plan − Protect Group organizational stability and continuity in case of temporary or lasting inability of “key managerial figures” ▪ Two interconnected processes IDENTIFICATION − Identification • Procedures to identify K
Slide 58: 2023 Actions – G.6 Updating on ESG Journey
ANNEX 2023 ACTIONS - G.6 UPDATING ON ESG JOURNEY G ▪ Improvement of communication transparency – 360° approach, not only ESG topics ▪ 2023-25 ESG Journey – Quarterly updating – Ad hoc presentations • Code of Ethics Updating, March 2023 • 2023-32 Decarbonisation Strategy, November 2023 – ESG section
Slide 59: Manager's declaration
The Manager in charge of preparing the company’s financial reports declares - pursuant to paragraph 2 of Article 154-bis of the Consolidated Law on Finance - that the accounting information contained in this presentation corresponds to the document results, books and accounting records. S.Ilario d’E