Slide 1: Presentation of third quarter 2019
Presentation of third quarter 2019 CEO Per Jørgen Weisethaunet and CFO Stian Lønvik Oslo, Norway 29 October 2019 1
Slide 2: Disclaimer
Disclaimer These materials, prepared by NORBIT ASA (the "Company"), may contain statements about future events and expectations that are forward- looking statements. Any statement in these materials that is not a statement of historical fact including, without limitation, those regarding the Company
Slide 3: NORBIT at a glance
NORBIT at a glance NORBIT is a global provider of tailored technology to carefully selected niches ▪ Founded 1995 ▪ HQ in Trondheim, Norway ▪ Offices and Subsidiaries in 12 countries ▪ Dedicated workforce of ~250 ▪ Listed on OSE with ticker NORBIT - NORBIT is to be recognized as world class, enablin
Slide 4: Tailored technology for carefully selected niches
Tailored technology for carefully selected niches Segment introduction Historic Revenue development (NOK million) ▪ Proprietary technology targeting global maritime markets 190 Oceans ▪ Core offering of sonar solutions developed 102 for selected niches 44 ▪ Proven global indirect distribution networ
Slide 5: Continued profitable growth
Continued profitable growth NOK million 600 30% Q3 2019 • Revenues of NOK 154 million for Q3-19, 500 25% 482 25% representing 46% growth 23% • EBITDA of NOK 39 million for Q3-19, 400 20% a margin of 25% 19% 311 300 15% 15% YTD 2019 • Revenues of NOK 482 million for YTD-19, 200 10% 154 representing 5
Slide 6: Oceans
wpaecayegsine ne Oceans
Slide 7: Oceans focus on broadening product offering
Oceans focus on broadening product offering Revenue and EBITDA Simplified P&L and key KPIs NOK million 180 168 35% NOK million Q3-19 Q3-18 YTD-19 YTD-18 160 30% 30% 140 134 Revenue 50.6 52.1 168.3 133.9 26% 25% 120 23% 25% EBITDA 11,4 15.9 44.6 33.1 100 20% EBIT 7.8 12.4 33.5 21.4 80 15% 52 51 Key K
Slide 8: Intelligent Traffic Systems (ITS)
DSRC solutions for enforcement in satellite based truck tolling Connectivity devices for tachograph Intelligent Traffic Systems (ITS) 8
Slide 9: Continued strong revenue growth for ITS
Continued strong revenue growth for ITS Revenue and EBITDA Simplified P&L and key KPIs NOK million 160 60% NOK million Q3-19 Q3-18 YTD-19 YTD-18 140 140 49% 50% 46% Revenue 61.8 9.6 139.5 25.2 120 45% 40% EBITDA 28.5 4.7 62.8 3.5 100 EBIT 24.6 3.5 53.7 -1.4 80 30% 62 63 60 Key KPIs 20% 14% 40 29 EBI
Slide 10: Product Innovation & Realization (PIR)
Product Innovation & Realization (PIR) 10
Slide 11: PIR revenues impacted by allocation of production capacity
PIR revenues impacted by allocation of production capacity Revenue and EBITDA Simplified P&L and key KPIs NOK million NOK million Q3-19 Q3-18 YTD-19 YTD-18 200 193 14% 175 180 12% 11% 12% Revenue 49.4 54.1 193.4 175.2 160 EBITDA 1.4 6.5 19.2 18.5 140 10% 10% EBIT -2.8 2.8 5.8 7.5 120 8% 100 6% Key K
Slide 12: Group financials
Group financials 12
Slide 13: Financials – P&L
Financials – P&L NOKm YTD 2019 YTD 2018 Q3 2019 Q3 2018 Comments Q3 2019 Revenue 481.7 310.9 154.4 105.4 Other gains and losses 10.9 • Revenues of NOK 154.4 million, Total operating expenses 383.0 263.2 115.9 85.1 46% growth EBITDA 109.6 47.7 38.5 20.3 Depreciation and amortisation expenses 34.4 28.
Slide 14: Financials – Balance sheet (Assets)
Financials – Balance sheet (Assets) Key financials Comments NOKm 30.09.2019 30.06.2019 • R&D investments 7.8% of revenues in Q3 2019 Research and development, patents 128.7 124.3 • Investments in machineries NOK 3.7 million Deferred tax asset 30.9 36.1 • Total capital increase by NOK 1.6 million Tot
Slide 15: Financials – Balance sheet (Equity and liabilities)
Financials – Balance sheet (Equity and liabilities) Key financials Comments NOKm 30.09.2019 30.06.2019 • Equity increased by NOK 16.7 million Share capital 5.7 5.7 • Long-term debt increased due to new lease contract Other equity 275.4 276.3 office in Hungary (IFRS 16) Retained earnings 135.7 118.1
Slide 16: Financials – Cash flow
Financials – Cash flow NOKm YTD 2019 YTD 2018 Q3 2019 Q3 2018 Cash flows from operating activities Comments Q3 2019 Profit for the period 52.7 40.5 18.1 7.4 • Working capital increased by Adjustments for: NOK 38.9 million Income tax expense recognised in profit or loss 11.8 3.3 5.1 2.3 o Inventories
Slide 17: Outlook
Outlook 17
Slide 18: Outlook
Outlook ▪ Maintains expectations for revenues and margins for 2H to be in line with 1H 2019 Oceans o Experienced positive development in October ▪ Low revenue visibility (2-4 weeks) combined with expected fluctuations between quarters Intelligent ▪ Maintains expectations for a stronger 2H than 1H 20
Slide 19: Exploring is finding opportunities where others find limits
Exploring is finding opportunities where others find limits 19
Slide 20: Long term financial targets
Long term financial targets 860 3Y Revenue CAGR 25% - 2017 base Targeting 3Y revenue CAGR > 25% starting 2017 685 550 438 YTD per Q3 2019 (482) 352 Long-term ambition of EBITDA margin > 20% Aims to invest ~5% of revenue in R&D, to secure long-term growth 2017 2018 2019 2020 2021 Actual 3Y CAGR 25% 2
Slide 21: Shareholder overview, updated October 2019
Shareholder overview, updated 25 October 2019 # Investor Shares # % 1 VHF INVEST AS - founder Steffen Kirknes 8 686 495 15.30 2 PETORS AS - CEO Per Jørgen Weisethaunet 6 645 695 11.70 3 DRAUPNIR INVEST AS - family of founder Steffen Kirknes 5 702 949 10.04 4 EIDCO A/S 3 597 124 6.33 5 ESMAR A/S 2 85
Slide 22: Creating a new niche: 4D sonar for real-time dredging
Oceans Creating a new niche: 4D sonar for real-time dredging Proven ability to develop niche markets 4D sonar for real-time dredging ▪ Created a niche market for real-time sonars in subsea dredging ▪ Dredging jobs typically target a specific depth ▪ Challenge: ‐ Zero or limited subsea visibility to
Slide 23: Selected client references by market segments
Oceans Selected client references by market segments ▪ A highly diversified customer base worldwide with largest customer in 2018 accounting for ~3% of Public clients within revenues hydrography ▪ In 2018, ~3% of total NORBIT Royal Japan Coast revenues was attributed to Danish Navy Guard Defence rel
Slide 24: Established proven global indirect distribution network
Oceans Established proven global indirect distribution network Indirect distribution supported by regional offices covering a wide range of clients in various industries NORBIT HQ R&D / Engineering Sales support offices 24
Slide 25: Tailored short range communication solutions
ITS Tailored short range communication solutions EU regulation and focus on distance based tolling creates a new market with huge potential One unit to connect them all: Gradual implementation of GNSS2 in EU truck EU priority to connect all tolling in Europe and enable vehicles to only need one OBU
Slide 26: Tailored connectivity modules for tachographs
ITS Tailored connectivity modules for tachographs Stable long-term market with ~ 400,000 trucks1 being registered in the EU annually ensure recurring revenue EU regulation implemented mid-20192: EU truck market: Mandatory to install smart tachograph in all new trucks registered after ~400,000 trucks
Slide 27: Secured long-term contracts
ITS Secured long-term contracts SATELLITE BASED (GNSS) TOLLING SMART TACHOGRAPHS TOLLING DSRC solutions for Connectivity devices for DSRC toll tags GNSS truck tolling tachographs (OBUs) ▪ 1 million units frame contract ▪ Continental ▪ Frame contract with NPRA2 for AutoPASS tags in Norway ‐ Tailored
Slide 28: In-house multidisciplinary R&D capabilities
PIR In-house multidisciplinary R&D capabilities R&D capabilities R&D competence ▪ Competence covering all aspects of technology and product design Competence areas # FTEs ▪ Special projects to explore new market domains, new technologies Embedded electronics, FPGA Firmware 15 and enable refinement o
Slide 29: World class in-house manufacturing
PIR World class in-house manufacturing Overview of NORBITs manufacturing sites ▪ High volume robotized production ▪ Automated, flexible, scalable Røros ▪ Micro electronics Automotive ▪ Thick film hybrid circuits ▪ Automotive certified factory ▪ Mid-low volume Selbu Defense, medical ▪ High complexity
Slide 30: Expansion of production capacity at Røros underway
PIR Expansion of production capacity at Røros underway 30
Slide 31: Exploring is finding opportunities where others find limits
Exploring is finding opportunities where others find limits 31