LEM Holding SA · SIX:LEHN
LEM Holding SA — Q1 2012/13 Earnings Presentation
33 slides from LEM Holding SA's earnings presentation, July 2012
Slide 1: Results Q1 of 2012/13
Results Q1 of 2012/13 1 April 2012 to 30 June 2012
Slide 2: Agenda
Agenda 1. LEM at a Glance 2. Highlights and Business Review 3. Financial Review 4. Strategy and Outlook 2
Slide 3: 1. About LEM
1. About LEM ■ LEM is the global market leader in providing innovative and high quality solutions for measuring electrical parameters. ■ The current and voltage transducers are used in a broad range of industrial and automotive markets. ■ LEM is a high growth global company with approximately 1’200
Slide 4: LEM Applications: Robot
1. LEM Applications: Robot To control the arm, power inverters drive a motor from one position to the next and stop precisely in position Accurate measurement of the current with transducers needed to control the arm A CASR 1 Control Unit 2 Inverter 3 Motor 4
Slide 5: LEM Applications: Mobile Phone Base Station
1. LEM Applications: Mobile Phone Base Station Transducers ensure stable power supply and control in case of a failure Transducers used to control the charge and discharge of power batteries for backup A HASS B LTS 1 Antenna 2 Battery 3 Controller 4 Power supply 5
Slide 6: LEM Applications: Electric Plug-in Car
1. LEM Applications: Electric Plug-in Car Battery management Electric motor management Charger management 1 High-voltage battery 2 Vehicle control unit 3 Charger 4 Motor controller A HAH1 B DHAB 5 Electric motor and transaxle C HC5F 6 DC/DC converter 6 D CAB 7 Electric power steering
Slide 7: LEM Applications: Plasma Cutting
1. LEM Applications: Plasma Cutting To maintain the arc continuously, current transducer measures the current through the arc Accuracy of measurement is important to guarantee accuracy and shape of cut A LAH 1 Electronic 2 Motor 3 Torch 7 3 XY-table
Slide 8: LEM Production & Logistics World-Wide
1. LEM Production & Logistics World-Wide Production Centers (PDCs) Adaptation Centers Sales Offices Agents / Distributors 8
Slide 9: LEM at a Glance - Businesses
1. LEM at a Glance - Businesses Industry segment Automotive segment Drives & welding Conventional cars ■ Motor drives ■ Lead battery management ■ Welding ■ Start/stop application ■ Miscellaneous Renewable energies & Green cars (HEV, EV) power supplies ■ Battery pack management ■ Solar ■ Electric mot
Slide 10: 2. Highlights and Business Review
2. Highlights and Business Review 10
Slide 11: Highlights Q1 2012/13
2. Highlights Q1 2012/13 In CHF millions, % Q1 2012/13 Q1 vs. Q1 2011/12 Q1 vs. Q4 2011/12 Orders 60.7 22.5% 10.3% Sales 63.1 -6.7% 13.0% Operational EBIT 11.4 -2.1% 41.4% Net earnings 10.7 48.6% 37.7% ■ Global economic uncertainty affects business development ■ High competitive pressures ■ Continui
Slide 12: Net Sales
2. Net Sales In CHF millions In CHF millions, % Sales Q1 vs. Q1 Q1 vs. Q4 300 275 Industry 53.5 -13.6% 13.1% 250 Automotive 9.6 67.6% 12.5% Total sales 63.1 -6.7% 13.0% 225 200 ■ Slow restart in Q1 of 2012/13 175 ■ Growth mainly in Asia (including 150 China) and North America 125 100 75 50 25 0 08/0
Slide 13: Quarterly View
2. Quarterly View In CHF millions Book‐to‐bill ratio 100 1.6 ■ Customers’ inventory 90 1.4 corrections ended in Q4 of 80 77.0 77.4 2011/12 75.0 1.2 70 66.8 67.7 63.1 ■ Slow recovery of sales 57.9 1.0 60 55.0 55.7 50 0.8 ■ 3rd quarter in a row with 40 growing orders 0.6 30 0.4 ■ Book-to-bill ratio cl
Slide 14: Industry Segment: Regional Markets
2. Industry Segment: Regional Markets In CHF millions, % Sales Q1 vs. Q1 Q1 vs. Q4 Europe North America Asia 2% Europe 26.5 -16.8% 0.0% Rest of the World N. America 7.5 3.4% 6.9% Asia 18.2 -14.2% 40.5% 34% ROW 1.3 -16.9% 62.3% Total 53.5 -13.6% 13.1% 50% Positive effect from recovery in solar mark
Slide 15: Industry Segment: Business Development
2. Industry Segment: Business Development In CHF millions Op. EBIT in % of sales Businesses and Applications 25 Drives & welding 280 Strong growth in Asia, particularly China New projects in the robot and elevator markets 240 20 Renewable energies & power supplies 200 Proved again its volatile
Slide 16: Automotive Segment: Regional Markets
2. Automotive Segment: Regional Markets Europe In CHF millions, % Sales Q1 vs. Q1 Q1 vs. Q4 North America Asia and Rest of World 9% Europe 0.9 60.3% 0.9% N. America 4.6 47.6% 9.3% Asia and 4.1 100.0% 19.3% 43% ROW Total 9.6 67.6% 12.5% Sales growth despite weak global car industry in Q1 of 2012/13
Slide 17: Automotive Segment: Business Development
2. Automotive Segment: Business Development In CHF millions Op. EBIT in % of sales Businesses and Applications 30 25 Conventional cars Continued on positive sales trend 25 20 20 Green cars (HEV, EV) 15 High level of activity 15 Sustainable growth in LEM’s key 10 regions 10 5 5 0 0 08/09 09/10
Slide 18: 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 ■ Sales impacted by slowing activity (first time ever over 50% of total especially in solar, wind and traction production) ■ “Made by LEM” quality
Slide 19: 3. Financial Review
3. Financial Review At the heart of power electronics
Slide 20: Income Statement
3. Income Statement In CHF thousands, % Q1 Change vs. Q4 Change vs. Q1 2011/12 Q1 2013 2011/12 Q1 2013 2012/13 Sales 67’659 -6.7% 55’844 13.0% 63’118 Gross margin 42.4% -0.3%pt 37.0% 5.1%pt 42.1% Operating expenses -17’101 -11.0% -12’617 20.7% -15’224 Operational EBIT 11’600 -2.1% 8’030 41.4% 11’359
Slide 21: Results by Quarter
3. Results by Quarter In CHF millions In % of sales 100 30% ■ Improved operating EBIT margin; 90 within target range 75.0 77.0 77.4 25% 80 ■ High net profit in % of sales, 70 67.7 63.1 66.8 20% resulting from decreased tax 60 57.9 55.0 55.8 charge and positive foreign 50 15% exchange effects 40 10%
Slide 22: Gross Margin
3. Gross Margin Q1 Q4 Q1 In CHF millions In % of sales 2011/12 2011/12 2012/13 46% 135 Gross margin 28.7 20.6 26.6 in CHF millions 45% 120 Gross margin 42.4% 37.0% 42.1% 44% in % of sales 105 90 43% ■ Negative impacts on gross margin in Q4 75 42% 2011/12 (foreign exchange effects, 60 increased price
Slide 23: Operating Expenses
3. Operating Expenses In CHF millions In % of sales Q1 Q4 Q1 70 30% 2011/12 2011/12 2012/13 Operating 60 expenses 17.1 12.6 15.2 25% in CHF millions 50 Operating 20% expenses 25.3% 22.6% 24.1% in % of sales 40 15% ■ Ongoing strict cost control measures 30 ■ Operating expenses as a percentage of 10%
Slide 24: R&D Expenses
3. R&D Expenses In CHF millions In % of sales Q1 Q4 Q1 15 10% 2011/12 2011/12 2012/13 R&D expenses 3.7 2.6 3.5 in CHF millions 12 8% R&D expenses 5.5% 4.7% 5.5% in % of sales 9 6% ■ Continued investment in R&D for both segments 6 4% ■ R&D expense at long-term average of 5.5% 3 2% 0 0% 08/09 09/10 10
Slide 25: Operational EBIT
3. Operational EBIT In CHF millions In % of sales Q1 Q4 Q1 2011/12 2011/12 2012/13 70 22% Operational EBIT 11.6 8.1 11.4 60 in CHF millions 20% Operational 50 EBIT 17.1% 14.4% 18.0% 18% in % of sales 40 ■ Returned to operational EBIT-margin 16% within target range 30 ■ Excluding additional SOP cost/
Slide 26: Legacy SOP Programs Expired per 31.03.2012
3. Legacy SOP Programs Expired per 31.03.2012 ■ With the closing of fiscal year 2011/12, all legacy stock option plans are closed ■ LEM will not record any additional stock option plan cost/income going forward ■ LEM has no further option based compensation programs 31.3.2008 31.3.2009 31.3.2010 31.
Slide 27: Financial Expense
3. Financial Expense In CHF thousands Q1 2011/12 Q4 2011/12 Q1 2012/13 Exchange effect* -2’309 -1’028 1’522 Other financial expense & income -30 -62 -21 Total -2’339 -1’090 1’501 Q1 of 2012/13 exchange effect mainly driven by USD & CNY appreciation vs. EUR & CHF Foreign exchange hedging policy
Slide 28: Net Profit
3. Net Profit Q1 Q4 Q1 CHF millions % of sales 2011/12 2011/12 2012/13 Net profit 7.2 7.8 10.7 in CHF millions 45 20% Net profit 10.7% 14.0% 17.0% 40 18% in % of sales Q1 2011/12 35 ‐0.1 ‐2.3 16% ‐1.9 30 14% 11.6 7.3 25 12% Operational EBIT SOP inc./cost Financial Income tax Net profit 20 expense 10
Slide 29: 4. Strategy and Outlook
4. Strategy and Outlook At the heart of power electronics
Slide 30: 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 markets 30
Slide 31: Strategic Priorities to Extend Leadership Position
4. Strategic Priorities to Extend Leadership Position Increase technology leadership ■ Established multidisciplinary innovation team ■ R&D roadmap foresees increased number of product launches ■ Improve performance of products in terms of precision and functionalities ■ Dedicated team of experts to
Slide 32: Outlook
4. Outlook ■ We expect the economic climate to remain challenging and uncertainty to persist in LEM’s markets ■ In the next quarters we expect lower positive impacts from restocking and higher negative impacts from competitive pressure ■ For 2012/13 we expect: ■ progressive restart in the Industry s
Slide 33: Financial Calendar and Contact Details
Financial Calendar and Contact Details Financial calendar 13 November 2012 Half-year results of 2012/13 14 February 2013 Third quarter results of 2012/13 5 June 2013 Year-end results and media and analyst conference 27 June 2013 Ordinary shareholders’ meeting for the year 2012/13 2 July 2013 Dividen