Slide 1: 2019 Half-Year Results and Outlook
2019 HALF-YEAR RESULTS AND OUTLOOK 20 August 2019 20 August 2019 / 2019 half-year results and outlook / 1
Slide 2: 1st half of 2019 in brief
1st half of 2019 in brief General uncertainty weighing on investment climate Phase of weakness for automotive industry Order intake, revenues, and EBIT all down sharply Investment in R&D maintained at a high level 9.7% of revenues directed toward expansion of technological and market leaders
Slide 3: Declining order intake due to phase of weakness in automotive industry
Declining order intake due to phase of weakness in automotive industry Order intake down by 19.2% in CHF million Various uncertainties US–China trade conflict 300 Worldwide Harmonized Light Vehicles Test 256.0 Procedure (WLTP) 224.4 Brexit 206.7 200 Customers are reluctant to invest and
Slide 4: Revenues fall back to level of H1 2017
Revenues fall back to level of H1 2017 Revenues decrease by 14.2% in CHF million Factors behind development of revenues Acquisition-related growth: +1.3% 300 Foreign currency impact: –1.9% 236.9 Revenues 4.4% higher than in H1 2017 194.7 203.3 Book-to-bill ratio: 1.02 200 100 0 Revenues
Slide 5: EBIT significantly lower than record figure last year
EBIT significantly lower than record figure last year Decline in volume business in CHF million High level of investment in R&D: 9.7% of revenues (H1 2018: 8.7%) 40 20% 35.7 Project expenditure in new areas of application (incl. data connectivity and aerospace) 15.1% 30 15% Negative currency
Slide 6: Agenda
AGENDA 1 2019 half-year results: financial performance 2 2017–2021 strategy: focus on core market 3 Outlook 2019 4 Questions 20 August 2019 / 2019 half-year results and outlook / 6
Slide 7: Growth in North/South America
Growth in North/South America Revenues by region Change from first half 2018 -30% -20% -10% 0% 10% 20% 2% 14% 4.5% Switzerland Switzerland -20.9% Europe Europe -18.3% Asia/Pacific 42% 24% Asia/Pacific 7.5% North/South America North/South America -18.6% Africa Africa -14.2% Total 18% Revenues by regi
Slide 8: Continued significant investment in R&D
Continued significant investment in R&D High investment in R&D is the foundation of future success in CHF million Planned annual R&D spending: 8%–9% 25 9.7% 10% Technological shift in automotive industry (e-mobility, 8.6% 8.7% autonomous driving, etc.) creating opportunities for 20 8% further
Slide 9: Sharp decline in EBIT
Sharp decline in EBIT Gross profit margin H1 2019: 64.3% (product mix) Gross profit margin in CHF million H1 2018: 62.8% Personnel expenses 35.7 in % of revenues H1 2019: 39.0% - Lower volume Personnel expenses - Lower variable in % of revenues costs H1 2018: 32.7% 1.2 –18.1 –1.8 –0.6 16.4 246.2 EBI
Slide 10: Negative currency effect
Negative currency effect Revenues by currency 115 110 105 11% 100 10% EUR 95 USD 49% CNY 90 10% CHF 85 12.16 02.17 04.17 06.17 08.17 10.17 12.17 02.18 04.18 06.18 08.18 10.18 12.18 02.19 04.19 06.19 Others 20% EUR (Basis: 1.09) USD (Basis: 1.03) CNY (Basis: 0.1484) Revenues by currency H1 2018 For
Slide 11: Group profit after taxes (EAT) falls significantly
Group profit after taxes (EAT) falls significantly EAT decreases by 62.2% in CHF million Financial result (CHF –2.2 million) reflects currency losses (particularly euro and emerging market 35 currencies) 30 28.3 Taxe rate in % of EBT: 24.1% (H1 2018: 16.2%) 25 Tax rate expected over medium t
Slide 12: Free cash flow despite high level of investments
Free cash flow despite high level of investments 16.5 in CHF million 6.3 10.7 –27.1 0.5 –9.3 51.0 Free cash flow incl. acquisitions CHF –2.9 million (H1 2018: CHF 4.1 million) 48.6 Dividends Free cash flow excl. acquisitions CHF 6.4 million (H1 2018: CHF 8.4 million) CHF –26.9 million 246.2 Increase
Slide 13: Investment volume remains high
Investment volume remains high Gross investment Net investment in non-current assets (excl. acquisition and sale of companies) (excl. acquisition and sale of companies): CHF 24.8 million (H1 2018: CHF 8.5 million) 16% Property, plant, and equipment (CHF 22.9 million, of which buildings: CHF 19.3
Slide 14: Investment in capacity expansion
Investment in capacity expansion All new buildings ready for occupation by end of 2019 at the latest Komax, Dierikon (CH) Komax SLE, Grafenau (DE) Kabatec, Burghaun (DE) Sharp jump in CAPEX due to high investment volumes for capacity expansion Total CAPEX 2018: CHF 41 million 2019: approx. C
Slide 15: High level of investment assured through credit facility
High level of investment assured through credit facility Loan in the amount of CHF 160 million through a bank syndicate (31.12.2018: CHF 160 million) in CHF million Term until January 2022 200 190 (plus option for extension until January 2023) 180 165 Further local credit lines for subsidiarie
Slide 16: Financial base remains very robust
Financial base remains very robust Continued high equity ratio in CHF million Net debt of CHF 71.2 million (31.12.2018: CHF 39.4 million) 500 75% 462.9 460.2 Retained earnings of CHF 236.0 million 436.2 60.1% 60.8% (31.12.2018: CHF 259.0 million) 400 60% 55.9% 300 281.6 45% 261.9 257.2 200 30%
Slide 17: RONCE declines sharply
RONCE declines sharply RONCE: 11.5% (H1 2018: 28.1%) in CHF million Strategic target 2017–2021: RONCE average 25% 300 272.2 280.5 Robust management of net working capital (NWC) 250 226.8 Ongoing improvement and acceleration 200 193.4 190.0 of internal processes Stringent accounts receivabl
Slide 18: Agenda
AGENDA 1 2019 half-year results: financial performance 2 2017–2021 strategy: focus on core market 3 Outlook 2019 4 Questions 20 August 2019 / 2019 half-year results and outlook / 18
Slide 19: We stand for...
We stand for... GROWTH PREDICTABILITY VALUE FOCUSED GENERATION STRATEGY SOLIDITY ROBUSTNESS FINANCIAL MARKET STABILITY LEADER PROFITABILITY BRAND STRENGTH 20 August 2019 / 2019 half-year results and outlook / 19
Slide 20: Strategic priorities
Strategic priorities Solutions along the value chain Solutions along the Innovative production Global customer Development of non- value chain concepts proximity automotive markets 20 August 2019 / 2019 half-year results and outlook / 20
Slide 21: Komax offers solutions for every stage of customers' value chain
Komax offers solutions for every stage of customers’ value chain Proportion of time spent per wire harness Cutting, crimping, 9% block loading, etc. 20% Pre-assembly, taping 9% Routing 9% Attaching clips, etc. 25% Testing 28% Packaging 20 August 2019 / 2019 half-year results and outlook / 21
Slide 22: Strategic priorities
Strategic priorities Innovative production concepts Solutions along the Innovative production Global customer Development of non- value chain concepts proximity automotive markets 20 August 2019 / 2019 half-year results and outlook / 22
Slide 23: Innovation as driver of success
Innovation as driver of success Continued significant investment in R&D Broadest product portfolio to meet changing market needs Launch of a number of new (digital) solutions to offer customers additional unique selling propositions 20 August 2019 / 2019 half-year results and outlook / 23
Slide 24: Development of e-mobility
Development of e-mobility Center of competence at Komax Thonauer in Budakeszi (Hungary) 100% 90% 80% Internal cumbustion engine (ICE) 70% Internal cumbustion engine (ICE) Stop/Start 60% Mild hybrid (MHEV) 50% 40% Full hybrid (HEV) 30% Plug-in hybrid (PHEV) 20% Battery electric vehicle (BEV) 10% 0% 2
Slide 25: Strategic priorities
Strategic priorities Global customer proximity Solutions along the Innovative production Global customer Development of non- value chain concepts proximity automotive markets 20 August 2019 / 2019 half-year results and outlook / 25
Slide 26: Global local
Global local The world’s largest sales, engineering, and service network Vehicle Bangkok production Wire harness Komax site production Sales representative Foundation of Komax Thailand 20 August 2019 / 2019 half-year results and outlook / 26
Slide 27: Strengthening of position in North America
Strengthening of position in North America Acquisition of Artos Engineering Founded in 1911 Own product portfolio and wealth of experience in developing innovative applications Headquarters in Brookfield, Wisconsin, USA 50 employees Consolidated as at 1 April 2019 20 August 2019 / 2019 hal
Slide 28: Largest installed base in the world
Largest installed base in the world Komax machines on all continents Continuous recurring earnings provide certain stability Diversified customer portfolio (including key accounts, small regional companies, all OEMs) ~ 20 Crimp to crimp machines ~ 20 Other machines 20 August 2019 / 2019 half-yea
Slide 29: Strategic priorities
Strategic priorities Development of non-automotive markets Solutions along the Innovative production Global customer Development of non- value chain concepts proximity automotive markets 20 August 2019 / 2019 half-year results and outlook / 29
Slide 30: Rigorous development of non-automotive markets
Rigorous development of non-automotive markets Aerospace Data/Telecom Industrial Non-automotive markets make a substantial contribution to revenues, accounting for less than 20% Selective and complementary build-up of competencies in non-automotive areas supports success of core business 20 Augu
Slide 31: What's next?
WHAT'S NEXT? 20 August 2019 / 2019 half-year results and outlook / 31
Slide 32: There are many reasons why the degree of automation is continually rising
There are many reasons why the degree of automation is continually rising in addition: rising wage costs 2%–3% CAGR over 5 years miniaturization autonomous driving Rising number of vehicles produced CAGR 2015–2021: approx. 2%–3% staff availability Expectations for 2019 traceability Decrease in autom
Slide 33: 2017–2021 strategy
2017–2021 strategy ambitious targets, attractive dividend policy 2021 2021 2017–2021 2017–2021 CHF CHF 500–600 80–100 Avg. 25% 50–60% million million of EAT Revenues EBIT RONCE Payout 20 August 2019 / 2019 half-year results and outlook / 33
Slide 34: Agenda
AGENDA 1 2019 half-year results: financial performance 2 2017–2021 strategy: focus on core market 3 Outlook 2019 4 Questions 20 August 2019 / 2019 half-year results and outlook / 34
Slide 35: Outlook
Outlook The Komax Group is confident it can achieve higher order intake, revenues, and EBIT in the second half of 2019 than in the first six months. After the very weak first months of 2019, business has stabilized. If the trend of the second quarter continues and this level can be maintained in the
Slide 36: Contact / Financial calendar
Contact / Financial calendar Contact Financial calendar Roger Müller Preliminary information on Industriestrasse 6 2019 financial year 28 January 2020 6036 Dierikon Annual media and analyst Switzerland conference on the 2019 Phone +41 41 455 06 16 financial results 17 March 2020 roger.mueller@komaxg
Slide 37: Disclaimer
Disclaimer This presentation contains forward-looking statements in relation to Komax which are based on current assumptions and expectations. Unforeseeable events and developments could cause actual results to differ materially from those anticipated. Examples include: changes in the economic and l
Slide 38: Questions?
QUESTIONS? 20 August 2019 / 2019 half-year results and outlook / 38