Coltene Holding Ag · SIX:CLTN
Coltene — Mainfirst Swiss SMID CAP Conference 2019
40 slides from Coltene's conference presentation, Oct 30, 2019
Slide 1: The New COLTENE
The New COLTENE COLTENE Group Company Presentation Geneva, 30 October 2019 Gerhard Mahrle Group CFO Mainfirst Swiss SMID CAP Conference
Slide 2: Safe Harbour Statement
Safe Harbour Statement The information made available in this presentation may include forward-looking statements that reflect intentions, beliefs or current expectations and projections of the COLTENE Group about future results of operations, financial conditions, liquidity, performance and similar
Slide 3: The New Coltene Group
The New Coltene Group Important player in the dental market Photo: Max Cui Production Service Technician / SciCan Ltd. Toronto, Canada
Slide 4: The New COLTENE – at a glance
The New COLTENE COLTENE – at a glance Infection Control Dental Preservation 3 Efficient Treatment product 6 legal 14 areas manufacturing sites Market Cap 14 sales entities supported approx. by over 300 sales reps CHF 480 mn Listed at SIX stock exchange in Zurich, Switzerland 1,400 employees MedTech
Slide 5: The New COLTENE – Production and R&D Locations
The New COLTENE – Production and R&D Locations State-of-the-art production facilities in the US, Canada, Brazil, Germany, France and Switzerland Canada, Toronto Switzerland, Altstaetten Germany, Langenau USA, Cuyahoga Falls (OH) Brazil, Rio de Janeiro France, Besançon Mainfirst SMID Conference Octob
Slide 6: Enlarged Product Assortment
Enlarged Product Assortment What COLTENE stands for Infection Control Dental Preservation Efficient Treatment „The infection „Sustainable preservation „Smart & efficient control specialist“ from root to crown“ utilities dentists rely on“ Instrument reprocessing Materials for restoration Impression m
Slide 7: FY 2018 Highlights
FY 2018 Highlights Entering into a new era for the Company Financials M&A Operations Net Sales CHF 204.0 mn Quantum leap thanks to the Strengthening global setup and +21.4% compared to 2017 acquisitions of Kenda, SciCan distribution network and Micro-Mega EBIT margin excluding Net Sales of the new C
Slide 8: New Building at the Headquarter in Altstaetten
New Building at the Headquarter in Altstaetten Modern office and manufacturing site • Commissioned beginning of 2019 • Start manufacturing in the new location beginning of March 2019 • Further optimised and more environmentally friendly operational processes thanks to new production facilities • Con
Slide 9: Comprehensive Product Portfolio
Comprehensive Product Portfolio Update dentistry – Better Quality, Better Reliability, Better Practice Infection Control Dental Preservation Efficient Treatment Instrument reprocessing and Restoration Endodontics Impression Rotary Treatment surface disinfection materials instruments utilities ParaCo
Slide 10: Net Sales by Product Groups
Net Sales by Product Groups Share by product group for the new COLTENE based on adding sales of COLTENE+Micro-Mega+SciCan for 2018 30.0% Infection Control 40.0% Dental Preservation Efficient Treatment 30.0% Mainfirst SMID Conference October 2019 Geneva 9
Slide 11: Truly Global Setup
Truly Global Setup Own sales force across North and Latin America, Europe, Asia including India and China North America Group companies 4 Production sites 2 Workforce (FTE) 620 35% Latin America CHF 90 m 45% Group companies 1 CHF 120 m Production sites 1 Workforce (FTE) 120 Europe EMEA 13% Group com
Slide 12: Business Model
Business Model Product sale through own warehouses via distributors to dental practices Production Sites Warehouses Sales Regions Sales Channels Customers CW AG – chemical production COLTENE sales reps Associations Altstaetten CH Europe EMEA Langenau GER MicroMega – endodontic files Besançon F Local
Slide 13: Dental Industry
Dental Industry Mega trends Globalization and e-commerce Increasing requirements in distribution regarding quality management and regulatory affairs Negative trend in volume due to Digitalization in better oral health in Consolidation • the dental processes developed countries in manufacturing • our
Slide 14: Strategic Approach
Strategic Approach Leverage synergies and cross sales potential Understand the Materialize the expected Establish the base for customers’ needs synergies from the merger operational excellence with SciCan and Micro-Mega Focus on innovation Push short-term merger projects Review group processes Visib
Slide 15: Combined Forces
Combined Forces Strategic priorities for 2019-2021 Endodontics Infection Control Marketing Sales Synergies • Establish sales teams with • Tailor the positioning of • Implement the Group-wide • Establish a global sales • Steadily build up powerful, endodontics specialists for ultrasonic cleaners, COL
Slide 16: Outlook
Outlook Photo: BRILLIANT EverGlow – universal submicron hybrid composite
Slide 17: Milestones 2019 and Summary
Milestones 2019 and Summary Consumables in dental industry have limited, but robust growth expectations We expect a global organic COLTENE expects to grow After additional costs due to the growth of our market segment slightly more than the market transaction & integration projects, in the area of 1
Slide 18: Outlook
Outlook Continued growth and profitability gains The recent merger rises sales Ongoing integration of new from CHF ~ 170 to ~ 280 mn and allowing to Group companies COLTENE benefit from economy of scale effects in is Upgrade Dentistry • Economies of scale effects • Increasing regulatory efforts • Sy
Slide 19: Numbers
Numbers The COLTENE Group in numbers Photo: Jasmin Gaby QM / Regulatory Affairs Office / Coltène/Whaledent AG Altstaetten, Switzerland
Slide 20: The COLTENE Group in Numbers
The COLTENE Group in Numbers 5 year overview (until 2017 IFRS; since 2018 Swiss GAAP FER) Net Sales (million CHF) 250.0 EBIT (million CHF) 30.0 200.0 25.0 150.0 20.0 15.0 100.0 10.0 50.0 5.0 0.0 0.0 2014 2015 2016 2017 2018 2014 2015 2016 2017 2018 Earnings per share / dividend per share (CHF) Net I
Slide 21: Financial Summary 2018
Financial Summary 2018 Strong top-line, impacted bottom line by one-time extraordinary effects Sales EBIT Net Profit New record sales of CHF 204.0 mn, EBIT of CHF 23.7 mn (2017: CHF 25.5 mn) Net profit amounted to CHF 14.9 mn up 21.4% (2017: CHF 19.1 mn) Organic growth of 2.7%, clearly EBIT margin a
Slide 22: Financial Summary 2018
Financial Summary 2018 Strong top-line, impacted bottom line by one-time extraordinary effects Tax Rate Cash Flow Balance Sheet Tax rate of 30.4% (2017: 22.2%) Cash flow from operations of Net debt position of CHF 29.2 mn CHF 24.6 mn (2017: CHF 21.9 mn) (2017: net cash position of 13.8 mn) Tax rate
Slide 23: Thank You for Your Interest
The New COLTENE Thank You for Your Interest COLTENE Holding AG Feldwiesenstrasse 20 9450 Altstaetten +41 71 757 53 80 info@coltene.com
Slide 24: Appendix
Appendix Photo: The COLTENE Group strengthened its position with two well-known industry leaders SciCan and Micro-Mega.
Slide 25: Organization
Organization Photo: Gaelle Batista Technical Support Logistics / Micro-Mega SA Besançon, France
Slide 26: Organization
Organization Management Board of Directors Group Management Matthew Robin Allison Zwingenberger Astrid Waser Werner Barth, VP Marketing Stefan Helsing, COO Jürgen Rauch Roland Weiger Martin Schaufelberger, CEO Werner Mannschedel, VP Q&RA Nick Huber, Chairman Erwin Locher Gerhard Mahrle, CFO Christop
Slide 27: COLTENE Group: Management Organization
COLTENE Group: Management Organization Operational Management of the COLTENE Group Board of Directors COLTENE Holding AG Group Management Martin Schaufelberger CEO Operations Quality Mgt/RA Marketing Sales CFO Stefan Helsing Werner Mannschedel Werner Barth Christophe Loretan Gerhard Mahrle SciCan Lt
Slide 28: COLTENE Group: Legal Structure
COLTENE Group: Legal Structure Group companies of the COLTENE Group COLTENE Holding AG Altstaetten CH CW INC Vigodent Kenda AG CW AG SciCan LTD Cuyahoga Falls Rio de Janeiro Vaduz FL Altstaetten CH Toronto CAN USA BRAS CW KG DentalDrives Sales Entities Diatech INC SciCan INC VV, CN, IN, F, IT, ESP,
Slide 29: Summary
Summary Consumables in dental industry have limited, but robust growth expectations The recent merger rises sales Sound financial situation from CHF ~ 170 to ~ 280 mn and allowing to post merger with net debt of COLTENE benefit from economy of scale effects in CHF ~ 30 mn is Upgrade Dentistry • incr
Slide 30: Financials H1 2019
Financials H1 2019 Photo: ParaPost – Well thought-out root post system for virtually every clinical situation
Slide 31: Net Sales by Region
Net Sales by Region Acquisitions made North America the Group’s largest product group Net sales H1 2019 by regions (in CHF 1,000) Net sales H1 2019 by regions (shares) H1 2018 H1 2019 70'000 61'911 60'000 12.1% 48'972 50'000 6.1% 36.2% 39'978 40'000 30'000 26'521 16'315 45.6% 20'000 11'648 7'457 10'
Slide 32: Net Sales by Product Groups
Net Sales by Product Groups Growth in all product groups, Efficient Treatment leads sales Net sales H1 2019 by product groups Net sales H1 2019 by product groups (in CHF 1,000) (shares) H1 2018 H1 2019 26.9% 60'000.00 55'900 41.3% 50'000.00 43'091 38'735 42'063 40'000.00 36'400 30'000.00 31.8% 20'00
Slide 33: Income Statement
Income Statement Non-recurring effects from first-time consolidation of acquisitions decreased operating results in CHF mn H1 2019 % H1 2018 % % YoY • Increase of net sales and operating expenses are mainly due to the Net Sales 135.4 100.0 85.6 100.0 +58.2 acquisition of SciCan and Micro-Mega. Mater
Slide 34: EBIT Development
EBIT Development In CHF million Factors influencing the operating result Competitive market environment 12.8 Launch of new products Integration project of SciCan and Micro-Mega 10.2 -0.2 Compliance with the new regulatory requirements -1.1 +3.9 contained in the European Union’s Medical Devic
Slide 35: Net Profit
Net Profit In CHF million Tax rate declined from 27.3% to 26.8% Financial expenses slightly higher Lower profits in high tax countries than previous year Expected medium-term tax rate Bank loan for financing the acquisitions approximately 25% Tax rate in % of net profit before taxes Financ
Slide 36: Balance Sheet
Balance Sheet Solid financial basis despite capital distribution to shareholders from capital contribution reserves in CHF million 30.06.19 31.12.18 % YoY The acquisition of SciCan and Micro-Mega Cash & cash equivalents 20.5 20.9 -1.9 took place at the beginning of October 2018 Receivables 56.4 60.7
Slide 37: Equity
Equity Solid equity ratio after switch from IFRS to Swiss GAAP FER In CHF million Equity ratio: 42.6% 31.12.18: 47.4% 30.06.19: 42.6% Decline in equity ratio due to dividend payment (payment out of reserves from capital contribution reserves) Net debt: CHF 45.8 million 185.5 185.0 (Net debt 31
Slide 38: Cash Flow Statement
Cash Flow Statement High investments in current and future growth in CHF million H1 2019 H1 2018 % YoY Negative free cash flow in H1/2018 due to a significant investment in a new production and Net profit 7.9 6.2 -21.5 office building at COLTENE’s headquarter in Depreciation and amortization 3.2 2.7
Slide 39: Free Cash Flow Development
Free Cash Flow Development In CHF million +3.2 -2.6 20.9 20.5 -7.2 +16.3 +7.9 -17.9 Free cash flow: CHF 1.3 mn (H1/2018: CHF -4.1 mn). Dividends: CHF 17.9 mn. Increase in financial Increase operating cash flow: H1/2019 CHF 8.6 mn liabilities CHF 16.3 mn. (H1/2018: CHF 8.1 mn) Since the start of 2019
Slide 40: Change in Accounting Standard
Change in Accounting Standard Change over from IFRS to Swiss GAAP FER took place on January 1, 2019 Changes IFRS Swiss GAAP FER Effects in B/S 31.12.2018 Valuation of goodwill Contained in intangible assets Offset against shareholder’s Offset CHF 172.8 million equity Purchase price allocation Contai
COLTENE Group — Mainfirst Swiss SMID CAP Conference 2019 on 6ix