LEM Holding SA · SIX:LEHN
LEM Holding SA — Q1 2014/15 Earnings Presentation
30 slides from LEM Holding SA's earnings presentation, Aug 12, 2014
Slide 1: Results Q1 of 2014/15
Results Q1 of 2014/15 1 April 2014 to 30 June 2014 12 August 2014
Slide 2: Agenda
Agenda 1. LEM at a Glance 2. Highlights and Business Review 3. Financial Review 4. Strategy and Outlook 2
Slide 3: Global Market Leader in Current and Voltage Transducers
1. Global Market Leader in Current and Voltage Transducers Market Position Performance Perspectives Source: Yahoo Finance Global market share Continued sales Reinforced invest- of 50% in Industry growth and margin ment in innovation Benchmark in service improvements Solid growth perspec- a
Slide 4: LEM Applications: Hybrid Loader
1. LEM Applications: Hybrid Loader A hybrid loader boosts fuel economy by up to A HTFS 800-P 25%, increases the system performance and is half as loud as a conventional loader. The special internal combustion engine (1) drives an AC generator (2) for the bucket 6 1 moves. The generator converts the
Slide 5: LEM Applications: Formula 1 Energy Recovery System
1. LEM Applications: Formula 1 Energy Recovery System 2014 Formula 1 cars include a revised energy recovery system (ERS). Engine specifications impose a 440 kW turbocharged (2) engine 4 A HC5 FW 2 combined with an ERS (3, 4) providing 5 3 additional 120 kW for over 30 seconds per lap. 6 7 A 1 The ER
Slide 6: LEM Applications: Roller Coaster
1. LEM Applications: Roller Coaster 1 Roller coasters use less and less traditional chain lift. The ride is maintained by gravity. 2 The initial acceleration energy is provided via 3 4 one or several linear motors (4), catapults, or other mechanisms replacing hydraulic or 5 pneumatic power. In case
Slide 7: LEM Applications: Sewing Machine/Embroidery Machine
1. LEM Applications: Sewing Machine/Embroidery Machine 4 Full servo control allows for speed and precision 7 in industrial sewing/embroidery machines. Accuracy and speed of the table movements, as 3 well as the correct, accurate and regulated rotation speed of the main axis for the needles 5 are dir
Slide 8: Diverse Target Markets – Diversified Businesses
1. Diverse Target Markets – Diversified Businesses Share of sales Businesses Q1 of 2014/15 Cyclicality Macro drivers Green Cars Consumer durables Technology adoption 13% Conventional Cars Fuel savings High precision Late cycle Infrastructure investments Traction Renewable energies Mid cycle Energy p
Slide 9: Agenda
Agenda 1. LEM at a Glance 2. Highlights and Business Review 3. Financial Review 4. Strategy and Outlook 9
Slide 10: Highlights Q1 of 2014/15: Solid Sales Growth
2. Highlights Q1 of 2014/15: Solid Sales Growth In CHF millions, % Q1 2014/15 Q1 2014/15 vs. Q1 2014/15 vs. Q1 2013/14 Q4 2013/14 Orders 64.7 -0.5% +2.0% Sales 65.0 +5.2% +6.4% EBIT 13.5 +2.2% -0.4% Net profit 10.7 +9.7% -14.2% ■ Strong EBIT margin, above target range of 15-20% ■ Strong competition
Slide 11: Net Sales
2. Net Sales In CHF millions In CHF millions, % Sales Q1 vs. Q1 Q1 vs. 300 as at constant Q4 275 reported currencies 250 Industry 56.5 +5.6% +9.9% +7.1% 225 Automotive 8.6 +2.9% +9.1% +1.7% 200 Total sales 65.0 +5.2% +9.8% +6.4% 175 ■ Sustained growth from Industry businesses 150 ■ Growth in Automot
Slide 12: Quarterly View
2. Quarterly View In CHF millions Book-to-bill ratio 70.0 65.1 65.0 1.2 Stable book-to-bill ratio 63.1 61.1 61.8 60.0 57.6 61.1 Lead times requested 55.8 1.0 55.0 by customers remain 50.0 short 0.8 40.0 0.6 30.0 0.4 20.0 0.2 10.0 0.0 0.0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 12/13 12/13* 12/13 12/13* 13/14
Slide 13: Industry Segment: Regional Markets
2. Industry Segment: Regional Markets Europe In CHF millions, % Sales Growth Growth North America Q1 vs. Q1 Q1 vs. Q4 Asia and ROW Europe 23.6 +1.3% -6.5% 42% N. America 5.7 -23.1% -17.4% Asia and 27.2 +19.4% +32.2% RoW 48% Total 56.5 +5.6% +7.1% Solid growth across most businesses Strong boost
Slide 14: Industry Segment: Business Development
2. Industry Segment: Business Development In CHF millions Op. EBIT in % of sales 30 Businesses and Applications 280 Drives & welding (growth QoQ: +4%) Strong sales in Asia 25 240 Slow business in Europe and North America Stable market share 200 20 Renewable energies & power supplies (+14%) S
Slide 15: Automotive Segment: Regional Markets
2. Automotive Segment: Regional Markets In CHF millions, % Europe Sales Growth Growth North America Q1 vs. Q1 Q1 vs. Q4 Asia and Rest of World Europe 0.5 -0.3% -20.1% 9% N. America 4.3 -6.4% +2.4% Asia and 3.7 +17.1% +5.0% RoW Total 8.6 +2.9% +1.7% 38% Focus on Asian and North American markets C
Slide 16: Automotive Segment: Business Development
2. Automotive Segment: Business Development In CHF millions Op. EBIT in % of sales Businesses and Applications 40 20 Conventional cars (growth QoQ: +3%) 18 Stable demand for battery management 35 applications 16 30 Some growth in USA and China 14 Green cars (HEV, EV) (-3%) 25 12 Weak global ma
Slide 17: Business Development China
2. Business Development China Sales Production ■ Market share of over 50% ■ LEM China expands its #1 position as largest manufacturing site of the Group ■ Most important market with 28% of (58% of total production, compared to total sales 56% in financial year 2013/14) ■ “Made by LEM” quality In CHF
Slide 18: Agenda
Agenda 1. LEM at a Glance 2. Highlights and Business Review 3. Financial Review 4. Strategy and Outlook 18
Slide 19: Income Statement
3. Income Statement In CHF millions Q1 Q4 Q1 vs. Q4 Q1 Q1 vs. Q1 2014/15 2013/14 2013/14 Sales 65.0 61.1 +6.4% 61.8 +5.2% Gross margin 45.3% 48.4% -3.2pt 45.4% -0.1pt Operating expense -15.9 -16.0 -0.8% -14.8 +7.3% EBIT 13.5 13.6 -0.4% 13.3 +2.2% Net financial exp. 0.1 0.3 -49.9% -1.4 N/A Income tax
Slide 20: Results by Quarter
3. Results by Quarter In CHF millions In % of sales 70 65.1 65.0 30% Fifth consecutive 63.1 61.8 61.1 61.1 quarter with EBIT 60 55.8 57.6 55.0 25% margin above target range 50 20% Q4 of 2012/13 included 40 a restructuring charge of 15% CHF 1.9 million 30 10% 20 5% 10 0 0% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
Slide 21: Gross Margin
3. Gross Margin In CHF millions In % of sales 48% Q1 Q4 Q1 135 2013/14 2013/14 2014/15 47% 120 Gross margin 28.1 29.6 29.4 46% in CHF millions 105 45% Gross margin 45.4% 48.4% 45.3% in % of sales 90 44% 75 43% Q1 2014/15 gross margin in line with last 60 42% years' margin, in accordance with seaso
Slide 22: Operating Expense
3. Operating Expense In CHF millions In % of sales 70 30% Q1 Q4 Q1 2013/14 2013/14 2014/15 60 Operating 25% expense 14.8 16.0 15.9 in CHF millions 50 20% Operating expense 23.9% 26.2% 24.4% 40 in % of sales 15% Ongoing strict cost control measures 30 Operating expense as a percentage of 10% 20 s
Slide 23: R&D Expense
3. R&D Expense In CHF millions In % of sales Q1 Q4 Q1 16 8% 2013/14 2013/14 2014/15 14 R&D expense 3.9 3.5 3.9 in CHF millions 12 6% R&D expense 6.3% 5.7% 6.0% 10 in % of sales 8 4% Maintained high investment in R&D for 6 both segments Ongoing renewal of product range with 4 2% focus on optimize
Slide 24: EBIT
3. EBIT In CHF millions In % of sales 60 26% Q1 Q4 Q1 2013/14 2013/14 2014/15 24% 50 22% EBIT 13.3 13.6 13.5 in CHF millions 20% 40 EBIT 21.5% 22.2% 20.8% 18% in % of sales 30 16% Continued cost control and high gross 14% margins 20 12% Profitability above target range of 15 to 20% 10% 10 8% 0 6
Slide 25: Financial Expense
3. Financial Expense In CHF millions Q1 2013/14 Q4 2013/14 Q1 2014/15 Exchange effect* -1.4 +0.2 +0.1 Other financial expense & income +0.0 +0.1 +0.0 Total -1.4 +0.3 +0.1 Foreign exchange hedging policy continued EUR: 100% of net exposure 12 months forward USD: 100% of net exposure 18 months f
Slide 26: Net Profit
3. Net Profit Q1 Q4 Q1 In CHF millions In % of sales 2013/14 2013/14 2014/15 Net profit 9.8 12.5 10.7 in CHF millions 50 20% 45 18% Net profit 15.8% 20.4% 16.5% in % of sales 40 16% Q1 2013/14 -1.4 -2.1 35 14% 30 12% 13.3 9.8 25 10% 20 8% EBIT Financial expense Income tax Net profit +0.1 -3.0 Q1 201
Slide 27: Agenda
Agenda 1. LEM at a Glance 2. Highlights and Business Review 3. Financial Review 4. Strategy and Outlook 27
Slide 28: Market Factors and Strategy
4. Market Factors and Strategy ■ We firmly believe in our strategic direction and the 4 drivers for our business remain unchanged ■ We will continue to capitalize on the drivers of LEM’s markets through pure play components company diversification across geographies and businesses 28
Slide 29: Outlook
4. Outlook ■ Economic perspectives improving with modest pick-up in Europe and North America and robust performance in China ■ For 2014/15 we expect ■ Industry segment: well positioned to capitalize on economic improvements and support from new products ■ Automotive segment: resume growth backed by
Slide 30: Financial Calendar and Contact Details
Financial Calendar and Contact Details Financial calendar 13 November 2014 Half-year 2014/15 results 17 February 2015 Third quarter 2014/15 results 4 June 2015 Year-end 2014/15 results 25 June 2015 Ordinary Shareholders’ Meeting for the year 2014/15 30 June 2015 Dividend ex-date 2 July 2015 Dividend