Interpump Group S.p.a. · MIL:IP
Interpump — FY2013 Earnings Presentation
36 slides from Interpump's earnings presentation, February 2014
Slide 1: 2013 Results Presentation to Analysts and Investors
INTERPUMP GROUP 2013 Results Presentation to Analysts and Investors February, 2014
Slide 2: Disclaimer
DISCLAIMER This document has been prepared by Interpump Group S.p.A for use during meetings with investors and financial analysts and is solely for information purposes. The information set out herein has not been verified by an independent audit company. Neither the Company nor any of its subsidiar
Slide 3: Index
INDEX Investment Highlights 4 Group overview 6 Activity & Products 13 Most significant Events 2013 19 Full year 2013 Financial Results 22 Appendix 34 3
Slide 4: Investments Highlights
Investments Highlights • Interpump Group is active in the mechanical component industry • IPG is present in two major sectors: Hydraulic (53% of total sales 2013) Water Jetting (47% of total sales 2013) • Total Sales FY 2013: € 557 million (86% abroad) • Very profitable (ROCE, ROE) since listing (12
Slide 5: IPG Strengths
IPG Strengths Market IPG Market Niches After-sale Market (and Service) Worldwide Markets Lean structure Technology barrier Stable technology Numerous Customers Very profitable (ROCE, ROE) Need of large Product Range Highly cash generative Fast growing 5
Slide 6: Group Overview
GROUP OVERVIEW 6
Slide 7: IPG History: Growth through Acquisitions
IPG History: Growth through Acquisitions Entry into Hydraulic First acquisition Sale of the Acquisition of Sector (Power Take Acquisition of components Cleaning Sector AMP (USA, Off’s/PTO’s) through 3 Hydrocontrol electric motors, Acquisition of Hydraulic Tanks) acquisitions (2 in Italy,1 (Italy, Hy
Slide 8: Trend by Year: Constantly improving
Trend by Year: Constantly improving (euro/million) Disposal of Cleaning Global Disposal of Global Sector Recession EBITDA Cleaning Recession SALES 120 Sector 109 106 105 600 557 502 528 527 100 95 95 493 86 500 426 436 472 80 81 85 412 409 80 75 71 74 400 400 343 329 61 65 59 319 320 283 60 47 300 4
Slide 9: Trend by Year: Very High Profitability
Trend by Year: Very High Profitability % ROCE* ROE* (Twelve months) (Twelve months) 35 35 % ROE Average ROCE 30 30 Average 25 25 20 20 15 15 10 10 5 5 = 18.4 = 16.7 0 0 * From 2004 to 2013 figures are prepared in accordance with International Financial Reporting Standards (IFRS). From 1996 to 2003 f
Slide 10: IPG 1996 Geographical Presence
IPG 1996 Geographical Presence 64% RoW 100% Italy 36% Manufacturing and Distribution Subsidiaries 10 Distribution Subsidiaries Sales Production
Slide 11: IPG 2013 Geographical Presence: Widely expanded
IPG 2013 Geographical Presence: Widely expanded 58% RoW 86% Italy 42% Manufacturing and Distribution Subsidiaries 11 14% Distribution Subsidiaries Sales Production
Slide 12: Stock and Governance: Increasing stock performances
Stock and Governance: Increasing stock performances MANAGEMENT TEAM INTERPUMP STOCK PERFORMANCE Since the listing until February 11, 2014 the Fulvio Montipò Chairman & CEO total return to shareholders’ (stock price Paolo Marinsek Deputy Chairman & CEO increase + dividends + buy- back) has been highe
Slide 13: Activity & Products
INTERPUMP GROUP ACTIVITY & PRODUCTS 13
Slide 14: IPG Major Market Sectors: Water Jetting
IPG Major Market Sectors: Water Jetting High and Very High Pressure Plunger Pumps Division % Total Sales 12Mo’13 Group’s Co’s World MkT (approx) From 2 to 25 horse power 17 % IPG Company (I) 50% From 25 to 1500 horse power 30 % Hammelmann (D) 40% NLB (USA) Pratissoli (I) 14
Slide 15: High and Very High Pressure Plunger Pumps Applications
High and Very High Pressure Plunger Pumps Applications Paint stripping on cruise ships Process pump Water Jet solution for surface preparation High Pressure Washers 15
Slide 16: New Challenging Development
New Challenging Development Platform fuel pump underwater Fuel injection pump for ship diesel application for the oil and gas industry engines Methanol injection to prevent water Mud pump freezing 16
Slide 17: IPG Major Market Sectors: Hydraulic
IPG Major Market Sectors: Hydraulic Division % Total Sales 12Mo’s 13 Group’s Co’s World MKT Share (approx) Power Take-Offs and Pumps 29 % IP Hydraulics (I) 50% (PTO’s) Muncie (USA) Takarada (Brazil) Hydraulic Cylinders 14 % Penta, Contarini, Cover, Modenflex, Panni (I) Leader brands in their market
Slide 18: Hydraulic System
Hydraulic System on Dump Truck... on Machining Center... Flanges Adaptor Fitting Ferrule hose Flexibles Hydraulic Connections 18 on Backhoe Loader... on Power Shovel... 18
Slide 19: Most Significant Events 2013
MOST SIGNIFICANT EVENTS 2013 19
Slide 20: Hydrocontrol Acquisition
Hydrocontrol Acquisition Hydrocontrol, headquarter in Bologna (Italy), is specialised in the production of hydraulic control valves and other accessories and components Main Figures in 2013: Sales: € 53.1 million EBITDA: € 6.1 million Net debt: € 20.8 million Total acquisition price, for 100%: 4.5 m
Slide 21: IMM Acquisition
IMM Acquisition IMM Group, based in Atessa (Italy) active in the production of hoses and hydraulic fittings. IMM has subsidiaries in: Romania, Great Britain, France, Germany and South Africa 2013 Forecasted main figures 2013 Sales € 57 million 2013 EBITDA € 9 million Net debt end December 2013 €25.0
Slide 22: 12 Mo's 2013 Financial Results
12 Mo’s 2013 FINANCIAL RESULTS 22
Slide 23: 12 Mo's 2013 Financial Results
12 Mo’s 2013 Financial Results (euro/million) 2012 2013* Changes SALES 527.2 556.5 + 5.6% EBITDA 105.9 105.2 - 0.7% % sales 20.1% 18.9% NPAT 53.2 44.1 -17.2% % sales 10.1% 7.9% Net debt (30.09) Net Financial Position 74.6 88.7 + 19.0% Valuation of Put Options 28.0 32.7 + 16.8% Total 102.6 121.4 + 18
Slide 24: 12Mo's 2013 Financial Results By Sector
12Mo’s 2013 Financial Results (euro/million) By SECTOR Sales EBITDA Sectors 2012 2013* Growth 2012 2013* Growth % % Hydraulic* 257.8 294.1 + 14.1% 37.4 14.5% 41.4 14.1% + 10.7% Water Jetting 269.4 262.4 - 2.6% 68.4 25.3% 63.8 24.2% - 6.8% Other - - 0.1 n.s. - n.s. n.s. Total 527.2 556.5 + 5.6% 105.9
Slide 25: Breakdown of Sales by Sector-Geography (12Mo's 2013)
Breakdown of Sales by Sector-Geography (12Mo’s 2013*) Consolidated €557 M Italy 15% 14% Eastern Europe 5% Rest of Europe Brazil India 34% 25% China North America Rest of the World 2% 3% 2% Water Jetting Sector Hydraulic Sector* €262 M €294 M 8% Italy Italy 15% 4% 15% 20% Eastern Europe Eastern Europ
Slide 26: Breakdown of Sales by Application Fields (FY 2013)
Breakdown of Sales by Application Fields (FY 2013) Water Jetting Sector 25-1500 HP Water Jetting Sector 2-25 HP €179 M €83 M (*) Contractors 3% Cleaning (car Industry (Aluminia; 10% wash; High 6% Chemical; Steel; Ship; pressure washer) 10% Automotive) 34% Dealers 21% Dealers Mining/Constructions 21%
Slide 27: Net Sales Emerging Markets
Net Sales Emerging Markets (euro/million) 80,0 +23% 70,0 60,0 50,0 40,0 31/12/2012 +19% 31/12/2013 (*) 67,0 30,0 54,4 +31% 20,0 +28% +20% 28,8 24,3 10,0 17,8 13,6 7,5 9,6 9,0 10,8 0,0 (10**) (12%**) China India Brazil Eastern Europe Total * Including Hydrocontrol (8 months) 27 ** Percentage on total
Slide 28: Procurement costs
Procurement costs IPG deployed a strong effort in reducing procurement costs. In 2013, procurement costs decreased by 0.2 points as a percentage of sales. Purchases as % of Sales 1st h. 12 Mo’s 2007 41.0% 40.8% 2008 41.1% 40.1% 2009 41.8% 42.2% 2010 39.7% 39.8% 2011 40.7% 40.7% 2012 39.4% 39.2% 2013
Slide 29: Net Debt
Net Debt Net Financial Position as of December 31, 2013 is affected by the Hydrocontrol acquisition Net Debt 12 M 2011 2012 2013 Net Financial Position 127.0 74.6 88.7 Valuation of Put Options 19.0 28.0 32.7 Total 146.0 102.6 121.4 29
Slide 30: Net Debt
Net Debt (*) Net debt, after the peak in 2009, rapidly declined and today D/EBITDA ratio is lower than 1x Net Debt 12 M 31.12.08 31.12.09 31.12.10 31.12.11 31.12.12 31.12.13 Net Debt/EBITDA 2.62 4.32 1.93 1.28 0.63 0.95 Net Debt/Equity 1.13 0.77 0.46 0.39 0.17 0.23 Net Debt/EBITDA Net Debt/Equity D/
Slide 31: Free Cash Flow
Free Cash Flow In 2013, Free Cash Flow is positively affected by the reduction of the working capital and negatively affected by the higher capex (of which 6.5 million for new building of Hammelmann). The 2010 was positively affected by the reduction of working capital due to the queue of the 2009 c
Slide 32: Working Capital
Working Capital Particular emphasis was put on keeping Working Capital under strict control Working capital 12M 2010 2011 2012 2013(**) Accounts Receivable (days) 71 73 66* 69 Accounts Payable (days) 69 72 61 72 Inventory (days) 143 143 145 144 Working Capital (€,m) 139 (€,m) 162 (€,m) 192 (€,m) 193
Slide 33: IPG: highly cash generative over time
Interpump Group IPG: highly cash generative over time IPG has returned substantial amounts of cash to shareholders since listing (12/1996) (euro/million) (1.1.97 – 31.12.13) Operating cash flow 785 Capital expenditures (253) Net cash flow before acquisitions and dividends 532 Dividends (279) Buy bac
Slide 34: Appendix
INTERPUMP GROUP APPENDIX 34
Slide 35: Synthesis of Results
Synthesis of Results (Twelve Months*) (Euro/ million) 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005(a) 2006(b)2007(c) 2008(d) 2009(e) 2010 2011(f) 2012 2013 (g) Net Sales 199.6 221.3 283.4 319.3 411.7 426.1 492.9 501.7 531.7 331.6 364.9 432.2 424.5 342.9 424.9 472.3 527.2 556.5 EBITDA 40.7 46.8
Slide 36: Declaration of the Manager responsible for financial reports
The Manager responsible for preparing the company’s financial reports, Carlo Banci, 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 record