Sfs Group Ag · SIX:SFSN
Sfs — H1 2015 Earnings Presentation
27 slides from Sfs's earnings presentation, Jul 24, 2015
Slide 1: Welcome to the presentation of 1HY 2015 results
Welcome to the presentation of 1HY 2015 results Global precision engineering champion with Swiss heritage Focused in technology – diversified in end markets
Slide 2: SFS representatives
SFS representatives Heinrich Spoerry Chairman of the Board of Directors and Chief Executive Officer Jens Breu Chief Operating Officer Rolf Frei Chief Financial Officer Claude Stadler Head of Corporate Communications and Investor Relations 2015-07-24 Presentation 1HY2015 results / page 2
Slide 3: Agenda
Agenda 1 Introduction and overview Heinrich Spoerry 2 Comments on development of key financials Rolf Frei 3 Development by segment Jens Breu 4 Outlook on 2HY 2015 Heinrich Spoerry 5 Q&A 2015-07-24 Presentation 1HY2015 results / page 3
Slide 4: Sales bridge
Sales bridge CHF million 750 645 39 22 -36 670 Reported growth 3.9% yoy Organic +6.1% 700 M&A +3.3% FX impact - 5.5% 650 Like for like growth by segment 600 13.9% in EC 2.5% in FS 550 -5.5% in D&L 500 Ramp-up of recent project wins on track 450 Growth contribution by 2.9% from tr
Slide 5: Sales breakdown by regions
Sales breakdown by regions 1HY 2014 1HY 2015 2015-07-24 Presentation 1HY2015 results / page 5
Slide 6: EBITA bridge
EBITA bridge CHF million 120 89 5 3 4 -29 -2 70 100 80 60 40 1HY14 Organic Change in Profit Transaction Translation 1HY15 growth scope improvements effect CH effect CH 2015-07-24 Presentation 1HY2015 results / page 6
Slide 7: Agenda
Agenda 1 Introduction and overview Heinrich Spoerry 2 Comments on development of key financials Rolf Frei 3 Developments by segments Jens Breu 4 Outlook on 2HY 2015 Heinrich Spoerry 5 Q&A 2015-07-24 Presentation 1HY2015 results / page 7
Slide 8: Financial Overview
Financial Overview CHF million 1HY15 1HY14 yoy Gross Sales 670.4 645.2 +25.2 FX impact on profitability -30.3 EBITDA 109.4 125.2 -15.8 As a % of operating revenue 16.5 19.2 EBITA 70.4 88.8 -18.4 As a % of operating revenue 10.6 13.6 Net Income 31.8 45.8 -14.0 As a % of operating revenue 4.8 7.0 Cash
Slide 9: P&L structure
P&L structure % of operating revenue 70% CM 240 bps down yoy Contribution margin (CM) 64.2% 65% 61.8% 100 bps FX impact 140 bps product mix 62.7% 63.2% 60% 62.2% 60.4% Selective price increases 54.4% 55.5% and non-recurring one-time 55% FX effects (A/R and 50% 52.3% 53.0% inventory) will imp
Slide 10: Operating profitability
Operating profitability in % of operating revenue in CHF million 25% 400 Negative FX impact on profitability with CHF 30.3m 350 20.0% 19.5% Operating cash flow (EBITDA) 20% 19.0% 17.3% 17.5% 300 down from 19.2% to 16.5%. Before negative FX impact 250 EBITDA margin at 20.0% 15% 14.1% 14.4% 13.3%
Slide 11: Capital expenditure
Capital expenditure Capex in % of operating revenue Capex in CHF million 8% 160 Capex spending with 5.7% 7.0% (5.9% PY) 7% 140 Share of growth capex 66% 5.8% 5.9% Advanced demand for 6% 5.7% 5.7% 120 5.3% localization Triggered by projects wins 5% 100 from prior year 97.6 Enabling future g
Slide 12: Net working capital
Net working capital NWC in % of operating revenue NWC Days outstanding 35% 280 Seasonal peak in net working capital with 32.7% on OR 30% 32.1% 32.7% 240 (32.1% PY) 30.1% 30.2% 29.2% 28.7% Furthermore strong growth in EC 25% 200 with DSO of 80 days contributes to the increase 20% 160 Average DS
Slide 13: Free cash flow
Free cash flow Free cash flow in % of EBITDA CHF million 60% 300 Free cash flow CHF 38m 51.7% Lower cash flow compen- 48.4% sated by lower increase in 50% 250 net working capital 37.7% Free cash flow conversion rate 40% 200 35.1% at 35.1% (PY 31.5%) 31.5% 30% 150 2nd HY normally shows strong
Slide 14: Return on net operating assets
Return on net operating assets EBITA in % of NOA NOA in CHF million 20.2% 20.4% 20% 4'000 Negative FX development also 19.1% impacts return on NOA 19.4% 14.6% Operational NOA before 15.5% intangible assets (Swiss GAAP) 15% 3'000 RONOA I down from 19.4% to 13.7% 14.6% 10.6% 10.7% 10.2% 10.6% RO
Slide 15: Net cash and equity ratio
Net cash and equity ratio Equity in % of assets CHF million 80.4% 79.9% Negative FX translation impact 80% 800 on equity ~CHF 100m 76.5% 70.6% 70% 600 Accounted for in OCI and not in 62.7% P&L 60% 54.7% 400 333.0 As total assets also declined due 50% 200 59.0 to FX rate flucations the equity 4
Slide 16: Agenda
Agenda 1 Introduction and overview Heinrich Spoerry 2 Comments on development of key financials Rolf Frei 3 Development by segment Jens Breu 4 Outlook on 2HY 2015 Heinrich Spoerry 5 Q&A 2015-07-24 Presentation 1HY2015 results / page 16
Slide 17: Headlines Engineered Components (EC)
Headlines Engineered Components (EC) Strong organic sales growth of 13.9% y-o-y (comparable basis) Strong demand from automobile and electronics industries Execution of new projects on track and contributed to the fast top-line growth Attractive profitability achieved, but significantly lowe
Slide 18: EC: substantial customer projects pipeline
EC: substantial customer projects pipeline Project Country Sales at Peak 2014 2015 2016 2017 2018 P1 CH CHF 5m P P2 CN CHF 5m PPAP SOP P P3 CH CHF 12m SOP P P4 US CHF 11m PPAP SOP P P5 CN CHF 5m PPAP SOP P P6 CH CHF 6m PPAP SOP P P7 CH CHF 5m PPAP SOP P P8 US CHF 15m PPAP SOP P P9 EU CHF 23m SOP P E
Slide 19: Headlines Fastening Systems (FS)
Headlines Fastening Systems (FS) Mixed Markets; solid demand in North America, Central Europe and Northern Europe, no material recovery in Southern Europe. Excluding currency effects, sales rose by 2.5% compared to the • Update strong first half of 2014. Recently introduced product innovations
Slide 20: FS: important customer wins & cost improvements
FS: important customer wins & cost improvements Selected customer wins Selected efficiency gains Market: Europe (Holland) Project: Transfer finishing from Yearly sales: CHF 2.5 mio CH to CZ Benefit: closer to customers Market: Europe (UK) Savings: CHF 2 – 3m Yearly sales: CHF 400,000 Realization: by
Slide 21: Headlines Distribution & Logistics (D&L)
Headlines Distribution & Logistics (D&L) Strong price pressure following the SNB decision of 15 January Immediate price concessions resulted in one-time margin contraction • Update Significant drop in demand, particularly from industrial customers (destocking effect) Market position strength
Slide 22: D&L: leadership in technology underscored
D&L: leadership in technology underscored Value for customer by reduced process/ warehousing cost & improved availability Upgrade of internationally acclaimed turnLOG® family with lower system cost and status updates (bidirectional) Introduction of additional solutions including integration of
Slide 23: Agenda
Agenda 1 Introduction and overview Heinrich Spoerry 2 Comments on development of key financials Rolf Frei 3 Development by segment Jens Breu 4 Outlook on 2HY 2015 Heinrich Spoerry 5 Q&A 2015-07-24 Presentation 1HY2015 results / page 23
Slide 24: Outlook 2015
Outlook 2015 Guidance March 2015 July 2015 FY 2015 1HY15 A 2HY15 E FY 2015 E Gross sales reported -2 to -4% 3.9% -3.4% +/- 0% • Organic growth 5 to 7% 6.1% 0.0% 3.0% • Change in scope n/a 3.3% 1.2% 2.2% • Negative FX impact n/a -5.5% -4.6% -5.2.% EBITA margin 12.9% to 13.6% to 12.1% to 10.6% 13.5% 1
Slide 25: Agenda
Agenda 1 Introduction and overview Heinrich Spoerry 2 Comments on development of key financials Rolf Frei 3 Development by segment Jens Breu 4 Outlook on 2HY 2015 Heinrich Spoerry 5 Q&A 2015-07-24 Presentation 1HY2015 results / page 25
Slide 26: More than 8,000 employees – one target
More than 8,000 employees – one target Creating value with In Depth Technological Competence International Presence Application and Industry Expertise Long-term Relationships 2015-07-24 Presentation 1HY2015 results / page 26
Slide 27: Disclaimer
Disclaimer This presentation includes forward looking statements. These statements reflect the SFS Group's current assesment of market conditions and future events. The statements are therefore subject to risks, uncertainties and assumptions. Unforseen events may lead to deviations of the actual res