Kitron Asa · OSL:KIT
Kitron Asa — FY2019 Earnings Presentation
22 slides from Kitron Asa's earnings presentation, Feb 13, 2020
Slide 1: Full year and Q4 results 2019
Full year and Q4 results 2019 Peter Nilsson, CEO Cathrin Nylander, CFO 13 February, 2020
Slide 2: Peter Nilsson, Kitron's CEO comments
Peter Nilsson, Kitron’s CEO comments ▪ Strong revenue growth increasing 20 % in Q4 and 26% year to date with particularly strong growth within Defence/Aerospace and Offshore/Marine market sectors. ▪ Year to date EBIT margin at 6.1% with margin improvements in Norway and Sweden ▪ Strong order backlog
Slide 3: Financial highlights Q4: Strong development continues
Financial highlights Q4: Strong development continues ▪ Revenue NOK Million Q4 2019 vs Q4 2018 o Continued strong growth 20.3 % o Organic growth 8 % Revenue 888,8 20,3 % ▪ Operating Margin/EBIT EBIT 54,2 28,3 % o Operating margin at 6.1% (5.7%) Order Backlog 1 883,9 41,1 % ▪ EPS 0.19 (0.16) NO
Slide 4: Financial highlights Full year: Strong development continues
Financial highlights Full year: Strong development continues ▪ Revenue NOK Million 2019 vs 2018 o Continued strong growth 26 % Revenue 26,0 % o Organic growth 16 % 3 299,4 ▪ Operating Margin/EBIT EBIT 201,5 29,1 % o Operating margin at 6.1% (6.0%) Order Backlog 1 883,9 41,1 % ▪ EPS 0.74 (0.63)
Slide 5: Important agreements in the fourth quarter
Major new orders: Important agreements in the fourth quarter KONGSBERG awarded orders to Kitron ▪ In October, Kitron received orders for communication equipment in K-TaCS and Nasams air defence systems supplied by KONGSBERG with a potential value approximately NOK 90 million. ▪ Deliveries will start
Slide 6: Important agreements in the fourth quarter
Major new orders: Important agreements in the fourth quarter Kitron awarded Energy orders ▪ In December, Kitron received orders with a value of more than NOK 75 million for development of test systems and production of electronics modules that are part of control systems for high-voltage direct curr
Slide 7: Corona Virus effects in China
Corona Virus effects in China Overall – we do not expect any material effects for Kitron based on current information Facility in China ▪ Kitron facility in China is located in coastal city of Ningbo, some 900 kilometers from the inland city of Wuhan. ▪ The facility is opened and running at 30% of t
Slide 8: Kitron Technologies and Kitron Poland
Kitron Technologies ▪ The facility of Kitron Technologies in Windber, Pennsylvania, was damaged by flooding in July ▪ Production has been running from a temporary site since then ▪ Salvage completed and restoration of site nearing end ▪ Current status Insurance Indemnification updated in Q4, losses
Slide 9: Financial statements Full year and Q4 2019
Financial statements Full year andQ4 2019
Slide 10: Revenue Q4: Strong revenue growth in Defence/Aerospace and Offshore/marine
Revenue Q4: Strong revenue growth in Defence/Aerospace and Offshore/marine Q4 2019 vs Q4 2018 Share of total revenue 860 889 Industry -10,6 % 35,5 % 813 739 738 Defence/Aerospace 116,5 % 28,5 % Medical devices 27,3 % 20,4 % NOK MILLION 20,3% Q4-2018 Q1-2019 Q2-2019 Q3-2019 Q4-2019 Energy/Telec
Slide 11: Revenue Full year: Strong revenue growth in Defence/Aerospace and Offshore/marine
Revenue Full year: Strong revenue growth in Defence/Aerospace and Offshore/marine 2019 vs 2018 Share of total revenue 3 299 Industry 6,3 % 38,4 % 2 437 2 619 Defence/Aerospace 65,3 % 22,6 % Medical devices 14,8 % 18,1 % NOK Million 20,3% Energy/Telecoms 14,5 % 14,4 % Q4-2017 Q4-2018 Q4-2019
Slide 12: Revenue by country Q4: Strong growth from Norway
Revenue by country Q4: Strong growth from Norway Q4 2019 vs Q4 2018 Share of total revenue Norway 30,3 % 26,4 % 244 290 266 187 184 166 Sweden -10,2 % 17,9 % 135 114 NOK Million 99 Lithuania -8,5 % 28,8 % Norway Sweden Lithuania 11 USA Others Q4-2018 Q4-2019 USA 918,8 % 12,3 % Before group e
Slide 13: Revenue by country Full year: Strong growth from Norway
Revenue by country Full year: Strong growth from Norway 2019 vs 2018 Share of total revenue Norway 27,8 % 24,8 % 851 1 009 1 110 Sweden 0,1 % 19,3 % 666 663 664 401 481 329 NOK Million Lithuania 10,0 % 32,3 % 36 Norway Sweden Lithuania USA Others USA 823,6 % 9,6 % FY 2018 FY 2019 Others 19,9
Slide 14: Quarterly EBIT: Improved profits
Quarterly EBIT: Improved profits ▪ Strong EBIT at 54,2 million, an increase of 28 per cent compared to last year 56,4 54,2 51,2 ▪ EBIT margin was 6.1% (5.7%) 45,0 43,1 42,3 38,8 39,6 30,0 NOK Million ▪ Start-up of Polish facility affects margins negatively short-term with MNOK 10 in Q4. 28.1% Q4-201
Slide 15: EBIT by Country Full year: Margin improvement in Norway and Sweden
EBIT by Country Full year: Margin improvement in Norway and Sweden ▪ Continued profitability improvements in Norway, 81,7 80,6 and Sweden ▪ Lithuania, lower margins due to ramp-up affects 44,0 42,0 and transfer of volumes to Poland 36,7 27,7 26,2 ▪ U.S. margins positive NOK Million 15,5 9,8 ▪ Kitron
Slide 16: Balance sheet: Working capital
Balance sheet: Working capital Net working capital ▪ Working capital o NOWC* 26.3% (23,0%) 927 933 887 942 779 o Cash conversion cycle* 102 (84) o ROOC* 14.8% (17.5%) NOK Million 20,9 % • Excl. IFRS 16 ROOC% 16.3% o NOWC Increase of 163, to MNOK 942 Q4-2018 Q1-2019 Q2-2019 Q3-2019 Q4-2019 • MNOK 100
Slide 17: Balance sheet: Working capital
Balance sheet: Working capital ▪ Cash flow o Q4 Cash flow from operations 97.2 (-26.8) o YTD Cash flow from operations 195.2 (-44.5) Operating cash flow 97,2 ▪ Financial gearing 463,1 % o NIBD / EBITDA 2.8 (1.9) 53,5 • Excl. IFRS16 NIBD/EBITDA 2.4 NOK Million 25,4 19,2 o Cash / interest bearing debt
Slide 18: Market development
Market development
Slide 19: Market development: Strong order backlog driven by Defence/Aerospace
Market development: Strong order backlog driven by Defence/Aerospace Organic growth 29% 2019 vs 2018 Share of total revenue Defence/Aerospace 95,8 % 45,0 % Order Backlog Energy/Telecoms 37,0 % 11,6 % 1 466 1 453 1 572 1 884 1 335 Industry 7,7 % 26,0 % NOK million Medical devices 13,1 % 11,2
Slide 20: Outlook
Outlook
Slide 21: Outlook 2020
Outlook 2020 ▪ For 2020, Kitron expects revenue to grow to between NOK 3 300 and 3 700 million. ▪ EBIT margin is expected to be between 6.4 and 7.0 per cent. ▪ Growth is driven by the Aerospace/Defence and Industry sectors. ▪ Profitability is mainly driven by operational improvements in Poland and t
Slide 22: Thank you!
Thank you!