Slide 1: Q2 Report
Q2 Report December 1, 2016 - Stockholm Richard Hausmann President and CEO Håkan Bergström Chief Financial Officer
Slide 2: Important information
Important information This presentation includes forward-looking statements including, but not limited to, statements relating to operational and financial performance, market conditions, and other similar matters. These forward-looking statements are based on current expectations about future event
Slide 3: Improved margins and cash flow
Improved margins and cash flow › Order intake in H1 in line with market. Flat Y/Y* › Net Sales -15%*. Implementation of Produce- to-order had a one-off effect of SEK ~650 M › Transformation on track › Target >20% EBITA margin (2017/18) › Cost savings of SEK 500 M reached (target SEK 700 M) › EBITA m
Slide 4: Stable market with geographical and quarterly variations
Stable market with geographical and quarterly variations North and South Europe, Middle East Asia Pacific America and Africa • Strengthened market • US improved from low levels • Challenging comparison from leadership in Q1 last year • Strong performance in India • Actions for improvement in • Growt
Slide 5: Challenging market conditions
Challenging market conditions NORTH AMERICA WESTERN EUROPE Replacement market. CHINA Hospital consolidation Pent-up demand but overall slow economic Growth, but lower than growth historic levels JAPAN Stabilization from low levels EASTERN EUROPE & MIDDLE EAST Political instability and weak economic
Slide 6: Two MR-linac orders signed - to be booked in Q3
Two MR-linac orders signed* - to be booked in Q3 Odense State-of-the-art Integrated Toronto radiotherapy MR-imaging system Launch in Ambition: second half of 75 orders calendar year until 2019 2017 *All in line with local regulatory requirements
Slide 7: Our way towards excellence – strategic update
Our way towards excellence – strategic update • Purpose, brand and values • Priorities • Organization simplified. Management changes Growth Cost 7 | Focus where it matters
Slide 8: Financial Update
Financial Update Håkan Bergström Chief Financial Officer
Slide 9: The ambition is to improve EBITA margin to 20%
The ambition is to improve EBITA margin to 20% Margin development* (illustrative) Transformation program targets 47% 46% 43% EBITA margin of 20% by 2017/18 40% 41% 41% Cost reductions of 23% 22% Net working capital Implemented 20% 14% 15% 16% SEK 700**M to sales below produce-to-order process. One-o
Slide 10: Improved margins
Improved margins Cost reductions offset temporary lower net sales 2016/17 2015/16 (SEK M) H1 H1 I. Net sales decreased by SEK 751 M - “Produce-to-order” process implemented, Net sales 4,316 5,067 COGS -2,527 -3,001 SEK 650 M II. Gross margin at 41.5% (40.8) Gross margin 41,5% 40,8% - Product mix and
Slide 11: Positive currency effect expected for FY 2016/17
Positive currency effect expected for FY 2016/17 Weakening of GBP have a positive effect on bottom line CURRENCY EFFECT H1 Y/Y ESTIMATED EFFECT 2016/17 Y/Y ESTIMATED EFFECT 2017/18 Y/Y (MSEK) (MSEK) (MSEK) • Effect on net sales: 1% • Effect on net sales: 3% • EBITA effect: ~130 • Effect on EBITA: 11
Slide 12: Underlying cash flow improved by approx. SEK 530 M
Underlying cash flow improved by approx. SEK 530 M CASH FLOW 2016/17 2015/16 I. Improved working capital (SEK M) H1 H1 - Produce to order process Operating Cash Flow 105 400 II. Lower continuous investments Change in Working Capital 97 -403 - Lower R&D capitalization Cash flow from operating activit
Slide 13: Net working capital at 4% to net sales
Net working capital at 4% to net sales* KEY WORKING CAPITAL ASSETS 5 000 NET WORKING CAPITAL as % of SALES 4 000 Accounts 15% receivables 3 000 10% Accrued 2 000 income 4,0% 1 000 5% Inventories 0 Q2 15/16 Q3 15/16 Q4 15/16 Q1 16/17 Q2 16/17 0% 1510AC 1601AC 1604AC 1607AC 1610AC KEY WORKING CAPITAL
Slide 14: Improved backlog position
Improved backlog position Q2 2015/16 Q2 2016/17 (SEK bn) (SEK bn) 21.7 18.2 4.3 5.4 5.1 4.3 Order Revenue H1 Revenue Order backlog Revenue H1 Expected backlog from backlog revenue from backlog FY 2016/17 14 | Focus where it matters
Slide 15: Elekta
CElekta