Arbonia Ag · SIX:ARBN
Arbonia — Investor Day (October 2021)
60 slides from Arbonia's investor day presentation, Oct 26, 2021
Slide 1: Capital Markets Day
Capital Markets Day 26 October 2021 Capital Markets Day | 26 October 2021 1
Slide 2: Agenda
Agenda 1. Transformation highlights 2018 Introductory remarks 2. HVAC Division 3. Doors Division 4.1 Group strategy 4.2 Mid-term financial targets 4.3 Sustainability 5. Q&A session Capital Markets Day | 26 October 2021 2
Slide 3: Capital Markets Day Programme
Capital Markets Day Programme 10.45 – 11.00 hrs Introductory remarks Alexander von Witzleben, CEO Arbonia Group 11.00 – 11.30 hrs HVAC Division Alexander Kaiss, CEO HVAC Division Claudius Moor, Co-CEO Doors Division 11.30 – 12.00 hrs Doors Division Markus Hütt, Co-CEO Doors Division Group strategy A
Slide 4: Key takeaways of the German coalition's roadmap
Key takeaways of the German coalition's roadmap Political tailwind for construction and HVAC industry Commitments Addressing and solving key challenges: climate change, digitisation, demographic change, securing wealth and social cohesion Accelerating innovation through faster procedures for investm
Slide 5: Group structure
Group structure Chairman of the Board of Directors Alexander von Witzleben CEO Alexander von Witzleben * CFO Corporate Functions Daniel Wüest * Doors Division Heating, Ventilation and Air Conditioning Division Co-CEO Doors Division: Claudius Moor * CEO HVAC Division: Alexander Kaiss * Co-CEO Doors D
Slide 6: HVAC Division Alexander Kaiss
HVAC Division Alexander Kaiss 1997 – today Arbonia Group 2021 – today Arbonia Group Member of Group Management CEO HVAC Division 2018 – 2020 Arbonia HVAC Division COO 2013 – 2017 Arbonia Heating Technology Business Unit Head of Technology 2001 – 2012 Kermi (CZ) Plant Manager 1997 – 2001 Kermi (DE) H
Slide 7: Doors Division Claudius Moor
Doors Division Claudius Moor 2015 – today Arbonia Group 2020 – today Arbonia Group Member of Group Management Co-CEO Doors Division 2019 – today Prüm-Garant Managing Director Sales & Marketing 2018 – today KIWI Member of the Advisory Board (Chairman as of 2020) 2017 – 2020 Arbonia Doors Division Mem
Slide 8: Doors Division Markus Hütt
Doors Division Markus Hütt 2020 – today Arbonia Group Co-CEO Doors Division 2010 – 2020 Jeld-Wen 2013 – 2020 Jeld-Wen Central Europe CEO 2010 – 2013 Jeld-Wen Deutschland Managing Director 2008 – 2010 Vigour (Cordes and Graefe Group) Managing Director 2007 – 2009 Vieler Head of Sales & Marketing 2003
Slide 9: Agenda
Agenda 1. Introductory remarks 2. HVAC Division 3. Doors Division 4.1 Group strategy 4.2 Mid-term financial targets 4.3 Sustainability 5. Q&A session Capital Markets Day | 26 October 2021 9
Slide 10: HVAC Division Starting point 2020
HVAC Division Starting point 2020 9 CHF CHF factories +9% 529 M 60 M # of state of the art Net revenues Net revenue CAGR EBITDA factories (2020) (2017-2020) (2020) 1 Located in 8 European Following a multi- Based on product At stable 11.3% countries BE, NL, DE, brand and -channel innovations, market
Slide 11: HVAC Division Proximity to our European customers
HVAC Division Proximity to our European customers AFG Russia Moscow / Stupino Brugman Tubbergen Vasco Arbonia Brugman Dilsen Riesa Legnica Kermi Kermi Wroclaw Stribro PZP Heating Kermi Dobré Arbonia Plattling Hagenbach Arbonia & Prolux Termovent Arbon Belgrade / Kladovo Sabiana Milan / Corbetta Tecn
Slide 12: HVAC Division Continuing growth in revenues and profitability
HVAC Division Continuing growth in revenues and profitability Ambition 2026 - Vasco Group - Cicsa (ES) June April Mile- stones - Tecna (ES) - Termovent (RS) September July Net revenues: > CHF 800 M 555 ~ 600 506 529 408 EBITDA: Net > CHF 100 M revenues (in CHF M) EBITDA margin: Growth: 23.8% 9.7% -4
Slide 13: Revenue split today
Revenue split today Balance between growth and mature products Heat pump Floor heating Radiators Growth products Net revenues Mature products by product Ventilation (2020) Thermal transfer products Growth products: Heat pump, ventilation, air handling, fan coils, underfloor heating, design radiators
Slide 14: Strategy for our portfolio
Strategy for our portfolio A comprehensive, integrated product range Heat pumps Generation of hot / Residential ventilation cold water Commercial or air air handling units Benefit of integrated systems: Storage of Thermal hot / cold Hot water storage comfort water and Electricity storage Energy Inte
Slide 15: Mega trends Supporting our growth ambition
Mega trends Supporting our growth ambition Mega trends Decarbonisation - Energy saving - Renewables - Sector coupling Healthy indoor climate - Air purity and quality Integrated system - Regulation of temperature supplier for indoor - Adjustment of humidity climate solutions Digitalisation - Products
Slide 16: Comprehensive product range
Comprehensive product range Serving all types of buildings We provide energy efficient solutions to all types of buildings: residential & commercial, new construction & renovation Residential Commercial BMS Air Handling Unit Fan Coil Skystar Radiant Ceiling Panel Clean Room Engineering residential f
Slide 17: HVAC Division Strategy
HVAC Division Strategy Focusing on new products for growing markets while further expanding success with radiators Heat pumps, hot water storage & battery Radiators best in class Radiant heating & cooling Integrated system for modern buildings supplier for indoor climate solutions Ventilation & indo
Slide 18: HVAC Division Strategy
HVAC Division Strategy Focusing on new products for growing markets while further expanding success with radiators Heat pumps, hot water storage & battery 1 Growth case heat pumps 2 New redox flow battery Integrated system supplier for indoor climate solutions Capital Markets Day | 26 October 2021 1
Slide 19: Growth case heat pumps
Growth case heat pumps Significantly expanding capacity Ambition Operations - Significant growth acceleration over the coming years - New heat pump factory CZ with capacity of up to 20'000 heat pumps - Benefiting from expansion of yearly production in a new heat pump factory CZ with up to 20'000 uni
Slide 20: New redox flow battery
New redox flow battery Breakthrough technology for energy storage Ambition Market - Redox flow as advanced battery: superior performance Annual battery additions (in thousands) combined with ecological advantages 665 - Enabling a high degree of energy self-supply for home Base (2020): 2 M existing 2
Slide 21: HVAC Division Strategy
HVAC Division Strategy Focusing on new products for growing markets while further expanding success with radiators Radiators best in class 1 Footprint optimisation Integrated system supplier for indoor climate solutions 2 Industry 4.0 3 Platform strategy Capital Markets Day | 26 October 2021 21
Slide 22: Radiators – Footprint optimisation
Radiators – Footprint optimisation Strengthening our presence in Russia Ambition Impression - Expanding steel panel radiator presence in Russia to serve strong local demand - With a newly added second welding line, increasing annual capacity to up to 700'000 steel panel radiators - Expansion of the
Slide 23: Radiators – Industry 4.0
Radiators – Industry 4.0 State of the art production sites Example 1 New automated welding lines - Modernisation and automation of steel panel radiator production in our factory in Plattling (DE) - Achieving full automation in steel welding leading to quality improvements and material savings - Part
Slide 24: Radiators – Platform strategy
Radiators – Platform strategy Cost advantages through complexity reduction Example: steel panel radiators Production footprint - Steel panel radiator platform across HVAC Division, e. g. harmonisation between Plattling (DE) and Stupino (RU) - Increased flexibility in production, warehousing and dist
Slide 25: HVAC Division Strategy
HVAC Division Strategy Focusing on new products for growing markets while further expanding success with radiators Radiant heating & cooling for Integrated system modern buildings supplier for indoor climate solutions 1 New radiant profile 2 Floor heating strategy Capital Markets Day | 26 October 20
Slide 26: New radiant profile & floor heating strategy
New radiant profile & floor heating strategy Continuous enhancement of our offering New radiant profile Product innovation - Stand-alone solution for radiant heating and cooling for commercial buildings and industrial application - Easy installation, high-class design Patent application for connecti
Slide 27: HVAC Division Strategy
HVAC Division Strategy Focusing on new products for growing markets while further expanding success with radiators Integrated system supplier for indoor climate solutions Ventilation & indoor air quality 1 Residential ventilation 2 Commercial ventilation Capital Markets Day | 26 October 2021 27
Slide 28: Residential ventilation
Residential ventilation Targeting growth with new products Summary Product innovation - Growth with already existing and with new in-house developed products for residential ventilation • Doubling of sales by 2026 • Increasing profitability through volume effect DACH platform BENELUX platform Market
Slide 29: Commercial ventilation
Commercial ventilation Growing our product portfolio and capacities Insourcing air handling units New factory: Sabiana 4 (IT) - Significant growth of Sabiana air handling unit business by expansion of our production capacity with a new production space of 8'000 m² Acquisition of Termovent Modern fac
Slide 30: Commercial ventilation Integrating components into a commercial system
Commercial ventilation Integrating components into a commercial system From components to a comprehensive commercial air treatment system + + + Customised air handling Under development: Crystall Filter Fan coil unit (AHU) HVAC standard AHU Capital Markets Day | 26 October 2021 30
Slide 31: HVAC growth and profitability roadmap
HVAC growth and profitability roadmap Based on clearly defined and monitored initiatives Net revenue roadmap (in CHF M, illustrative) ~ > 800 - Clear business case for each () growth initiative () - Stringent project management for execution according to planned milestones 529 - Good progres
Slide 32: Roadmap with focus on growth products
Roadmap with focus on growth products Ambition 2026: 2/3 net revenues with growth products Battery Heat Mature products pump Radiators Floor Net revenues heating by product (ambition) Growth products Ventilation Thermal transfer products Growth products: Battery, heat pump, ventilation, air handling
Slide 33: HVAC Division Summary
HVAC Division Summary ► Net revenue ambition 2026: > CHF 800 M ► EBITDA ambition 2026: > CHF 100 M Integrated system ► EBITDA margin 2026 supplier for indoor climate solutions > 12.5% ► Backed by various projects for revenue growth and profitability Capital Markets Day | 26 October 2021 33
Slide 34: Agenda
Agenda 1. Introductory remarks 2. HVAC Division 3. Doors Division 4.1 Group strategy 4.2 Mid-term financial targets 4.3 Sustainability 5. Q&A session Capital Markets Day | 26 October 2021 34
Slide 35: Doors Division Starting point 2020
Doors Division Starting point 2020 CHF CHF 2.5 M +280 bps 364 M 49 M # of wooden doors 1,2 Net revenues EBITDA (2020) 1,3 2017-2020 sold (2020) (2020) 1 EBITDA margin 1,3 Produced in 4 market CHF 509 M combined, CHF 66 M combined, Cost structure and leading wooden door whereof CHF 364 M from whereof
Slide 36: Doors Division Investments as basis for profitable growth
Doors Division Investments as basis for past and future disproportionate profitable growth Ambition 2026 Acquisition of Profile Prüm, Capacity Beginning - Integration of Mile- Looser Systems Garant, expansion ERP Glass Solutions stones (Closing Dec. disposed Invado fully started to harmonisation - A
Slide 37: Doors Division Highlights
Doors Division Highlights Market leadership in Central Europe for door solutions out of wood and glass with revenue 1 potential > CHF 725 M in 2026 Positive market prospects for housing construction driven by urbanisation and 2 continuously growing number of buildings for renovation business Address
Slide 38: Market leadership in Central Europe Wood Solutions Business Unit
Market leadership in Central Europe 1 Wood Solutions Business Unit Production footprint Geographical focus Central Europe (core markets) Rest of Europe (export markets) - Weinsheim (DE), 750 FTE No. Market position 1 - ~ 1 M doors/year Production site No. 2 No.4 - Ichtershausen (DE), 550 FTE - ~ 0.8
Slide 39: Market leadership in Central Europe Glass Solutions Business Unit
1Market leadership in Central Europe Glass Solutions Business Unit Production footprint Geographical focus Core markets Export markets No. Market position 1 - Plattling (DE), 675 FTE Production site - 25'000m2 production plant - Local sales companies in Poland, Local sales office Czech Republic, Rus
Slide 40: Positive market prospects Germany: residential construction
Positive market prospects 2 Germany: residential construction Building permits Building completions Potential for renovation Number of flats (in thousands) Number of flats (in thousands) Number of doors sold in Germany (in M) Permitted but not 15 completed buildings of ~700'000 flats 12.8 28% Avg. l
Slide 41: Addressing the mega trends
Addressing the mega trends 3 Residential construction trends Supporting mega trends New ways Sustain- Demographic Digitisation of living ability chance - Urbanisation - Digital planning (BIM) - Climate change plan 2050: - Ageing society - Home office - Usage of sensors in • Energy efficiency - Lack
Slide 42: Platform for growth Selected opportunities
Platform for growth 4 Selected opportunities Selected growth potentials Germany: Build-up of non-residential Switzerland: Increase market shares in W-CH Residential Non-Residential German speaking 3 French speaking 3% 1% 24% 24% ~ 900 M1 ~ 550 M1 ~ 250 M2 ~ 70 M2 - Investments in machinery to produc
Slide 43: Digital outrider Selected initiatives
5Digital outrider Selected initiatives Selected digital initiatives System: ERP harmonisation Digitalisation of production planning (MES) MES: Production planning in SAP S/4 HANA Machinery (Industry 4.0) real time Lead time reduction! Platform for digital sales processes Products: SmartDOORS - 25% s
Slide 44: Cost leadership Selected initiatives
Cost leadership 6 Selected initiatives Selected cost leadership initiatives Arbonia Doors Platform New frame production site at Prüm - Economies of scale: capacity increase of 40% - Start of production: H2 2022 Vertical integration New door production site at Invado Insourcing of value creation - Au
Slide 45: Doors Division Summary
Doors Division Summary ► Net revenue ambition 2026: > CHF 725 M ► EBITDA ambition 2026: > CHF 110 M Expanding the leading position in Wood and ► EBITDA Margin 2026 Glass Solutions > 15.0 % in Central Europe ► Backed by various projects for revenue growth and profitability Capital Markets Day | 26 Oc
Slide 46: Agenda
Agenda 1. Introductory remarks 2. HVAC Division 3. Doors Division 4.1 Group strategy 4.2 Mid-term financial targets 4.3 Sustainability 5. Q&A session Capital Markets Day | 26 October 2021 46
Slide 47: Group strategy Summary of our pathway towards 2026
Group strategy Summary of our pathway towards 2026 Lean corporate centre, allocating and managing capital, steering ESG and serving as centre of excellence for key functions, such as finance, accounting, IT, tax, legal, M&A HVAC Doors - Integrated system supplier for indoor - Expanding the leading p
Slide 48: Group strategy Positive prospects to grow profitably
Group strategy Positive prospects to grow profitably Aiming for growth… …and profitability Example: HVAC sales by product type Example: Wood Solutions EBITDA (in CHF M, margin %) 25% 50% Growth > 16% 67% products 13.5% 10.7% 75% > 85 50% Mature 33% 49 products 36 2012 2020 2026e 2017 2020 2026e Addr
Slide 49: Group structure as of April 2022
Group structure as of 22 April 2022 Executive Chairman Alexander von Witzleben Doors Division HVAC Division Group Co-CEO Doors Division: Claudius Moor * CEO: Alexander Kaiss * CFO: Daniel Wüest * Co-CEO Doors Division: Markus Hütt Heating, Ventilation and Air Conditioning Wood Solutions Glass Soluti
Slide 50: Why Arbonia? Investment Highlights
Why Arbonia? Investment Highlights Market leadership in Central Europe for doors (wood and glass) and steel panel radiators as well as a strong challenger position in fast-growing, sustainable heating & ventilation systems as an integrated systems provider Future-oriented product portfolio with grow
Slide 51: Agenda
Agenda 1. Introductory remarks 2. HVAC Division 3. Doors Division 4.1 Group strategy 4.2 Mid-term financial targets 4.3 Sustainability 5. Q&A session Capital Markets Day | 26 October 2021 51
Slide 52: Mid-term guidance 2026 Group key performance indicators
Mid-term guidance 2026 Group key performance indicators Financial Annual organic growth (CAGR 2021 – 2026) > 5% p.a. Group EBITDA (excluding M&A) > CHF 200 M Capex in % of revenues (maintenance and growth) 4-5% Cash Conversion Ratio (FCF in % of net profit) > 100% (as of 2024) Pay-out Annual dividen
Slide 53: Sustainable Cash Flow generation
Sustainable Cash Flow generation in CHF M (illustrative) % 200 15 - Accelerated Capex programme leads to 8.3% 10 150 Capex ratios of around 10% in 2021 4-5% 5 and 2022 100 0 - From 2023 onwards gradually declining 50 86 to 4-5% maintenance and expansion -5 Capex until 2026 0 -10 2020 2021 1 2022 202
Slide 54: Use case: translating Capex into profitability and cash
Use case: translating Capex into profitability and cash Capex programme Wood Solutions Business Unit in CHF M (illustrative) > 16% 18 16 13.5% 12.2% 14 10.7% 10.9% 12 10 44 49 8 36 39 6 -1 -3 2 -1 4 -23 -34 -39 2 -48 0 -2 -4 -6 -8 -10 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 EBITDA 1 EBITDA
Slide 55: Agenda
Agenda 1. Introductory remarks 2. HVAC Division 3. Doors Division 4.1 Group strategy 4.2 Mid-term financial targets 4.3 Sustainability 5. Q&A session Capital Markets Day | 26 October 2021 55
Slide 56: Sustainability Accomplishments 2021
Sustainability Highlights of our commitments and activities Commitments Accomplishments 2021 - Defining overarching sustainability goals and ambitions on group, divisional and company level to improve the sustainability performance - Calculating a concrete CO2 reduction path (for Scope 1 & 2) based
Slide 57: Climate – Community – Cash
Climate – Community – Cash Specific actions how we care about our environment CO2 & Energy Transforming waste Climate Example: Improving our ecological footprint for Prüm by means of a into heat and new combined heat and power plant: electricity to supply - Investment proposal approved in 2021 Prüm
Slide 58: Agenda
Agenda 1. Introductory remarks 2. HVAC Division 3. Doors Division 4.1 Group strategy 4.2 Mid-term financial targets 4.3 Sustainability 5. Q&A session Capital Markets Day | 26 October 2021 58
Slide 59: Disclaimer
Disclaimer Arbonia AG is making great efforts to include accurate and up-to-date information in this document, however we make no representations or warranties, expressed or implied, as to the accuracy or completeness of the information provided in this document and we disclaim any liability whatsoe
Slide 60: Thank you!
Thank you! Capital Markets Day | 26 October 2021 60