Star7 S.p.a · MIL:STAR7
Star7 — FY2023 Earnings Presentation
30 slides from Star7's earnings presentation, Mar 28, 2024
Slide 1: Conference Call | 28 March 2024
CONFERENCE CALL | 28 MARCH 2024
Slide 2: Disclaimer
This document (the "Document") has This Document is intended solely to The Document does not have the been prepared for the sole purpose of provide selected information to its nature of an opinion presenting the company STAR7 recipients and in no way constitutes a on financial, legal, tax or S.p.A.
Slide 3: Agenda
m= Ataglance AGENDA f Financial results STAR7 FY 2023 O People&lInnovation a ¢ Final remarks ‘\ Appendix STARZ 3
Slide 4: Founder & Group CEO, CFO, General Manager
Founder & Group CEO Chief Financial Officer General Manager
Slide 5: At a Glance
STARZ FY 2023 AT A GLANCE
Slide 6: FY 2023 key figures vs FY 2022
vs FY 2022 vs FY 2022 vs YE 2022 vs FY 2022 vs FY 2022 By amortizing goodwill from acquisitions Source: management information as according to IFRS. at 29/02/2024.
Slide 7: FY 2023 highlights and execution
• Effective execution of the Integrale⁷ model behind the organic growth achieved. • Improved visibility of future revenues. In FY23, strengthened relations with major clients following the multi- year renewal of key contracts. • Successful effort to maintain, expand and strengthen the customer portf
Slide 8: Growth opportunities for 2024
Seamless execution of the contract with Stellantis, smoothly on stream since the beginning of 2024, proving STAR7’s operational skills and the effectiveness of the preparation and set-up work done in H2 2023 (estimated additional revenues in 2024: +€6m). Strong increase in Global Content services to
Slide 9: Financial Results
STARZ FY 2023 FINANCIAL RESUL
Slide 10: Revenues FY 2023 vs FY 2022
REVENUES (data in €m) Change % FY 2023 vs FY 2022 All sectors have positively contributed to the growth, with major impacts driven by customers in Transportation, Aerospace and Defence, and Machinery enhanced by Engineering, Product Knowledge, and Global Content Service Lines.
Slide 11: Revenues by geography
Italy’s weight decreasing, even though revenues increased in absolute value. In Brazil, ten years of continued double-digit growth. Focus on nurturing organic growth in the US market. Ready to open up new markets: India and Argentina in the crosshairs.
Slide 12: Revenues by service line
Better balance achieved between service lines – a key element in activating the Integrale⁷ formula. Global Content (GC) with lower weight than in FY 2022, but with higher revenues in absolute value. Engineering (EN) confirmed the strong growth achieved in H1 2023. Synergies between Engineering and P
Slide 13: Adjusted EBITDA
EBITDA adjusted (data in €m) Change % FY 2023 ADJ VS. FY 2022 The organic business perimeter maintained the previous level of margins, notwithstanding the organisational changes needed to make the structure ready for an optimal execution of major new contracts. 15.5 14.6 16.0 In addition to the impa
Slide 14: A firm commitment to cost rationalisation
A firm commitment to cost rationalisation Two operational offices, a team of 183 engineers, linguists and 3D artists working in a fully integrated way with our core customer teams. Through off-shoring, we have a solution to rationalise costs and increase competitiveness for more than 70% of our curr
Slide 15: EBITDA margin trend
(data in €m) The recent trend reversal in the dynamics of the EBITDA margin confirms the effectiveness of: the CAAR integration strategy executed the cost rationalisation process undertaken, leveraging a growing presence in Albania.
Slide 16: Working capital and net debt
(data in €m) Working Capital increase (+19.8% vs FY22, +€8m) supporting the strong Revenues growth (+25.4%). Higher-than-usual concentration of invoiced revenues for major clients in Q4, with some 30% of STAR7 SpA revenues invoiced in the last few months of 2023. Despite the temporary debt increase,
Slide 17: Cash flow and debt profile
Cash flow generation covers organic growth funding needs. After the payment of Q4 invoices, Net Cash is back to €16m as at 29 February 2024. (Source: management information) Considering the debt maturity profile, STAR7 has no major refinancing need in the short-term. Mini- bond repayment plans are s
Slide 18: People & Innovation
STARZ FY 2023 PEOPLE&INNOVAT
Slide 19: A company of young people
A company of young people, open to change and able to combine a high skills profile with the needs of its customers and new technologies and innovation.
Slide 20: Workforce by role
80.0 70.0 60.0 50.0 40.0 67.0% 30.0 20.0 10.0 17.3% 15.0% 4.1% 11.3% 0.0 Engineers Language PM & Developers Blue Collars 3D artists specialists
Slide 21: Gender balance and sustainability initiatives
Striving to establish a gender- Establishment of an Internal Circular Economy: balanced workforce, Risk and Sustainability Control enhancing material use and especially concerning women Committee to manage both waste management. in managerial positions. positive and negative impacts. Paper Waste Red
Slide 22: GEN-AI and client offerings
By leveraging our knowledge of The expertise of our engineers, our clients' products, coupled with our deep combined with the significant understanding of our clients' potential of GEN-AI, we will be processes, enables us to empowered to enhance our accompany them on their journey clients' offerings
Slide 23: Exclusive customer data for GEN-AI
We have full access to exclusive customers’ data – a value that public LLMs cannot replicate We collect large volumes of information We boast a longstanding track record in Global Content services We have a multiskilled team of experts to do customised 'training' of our customers' GEN-AI engines (Ex
Slide 24: Final Remarks
STARZ FY 2023 FINAL REMARKS
Slide 25: Internationalisation, Integrale7 and GEN-AI
Internationalisation: now ready to The CAAR integration process A clear evolution roadmap, with open up new markets (India, required us to wait for its completion significant milestones already in Argentina and Saudi Arabia) 2024 We retain a consistent pipeline of Integrale⁷ : the Engineering servic
Slide 26: Appendix
STARZ FY 2023 APPENDIX
Slide 27: Income statement
Net Revenues 104,405,634 83,251,178 21,154,456 25.4% Other revenues 941,653 1,588,134 -646,481 -40.7% Change in inventories and increases in fixed assets 275,543 145,499 130,044 89.4% External costs -47,771,247 -40,371,550 -7,399,697 18.3% Personnel costs -43,236,653 -29,156,658 -14,079,995 48.3% De
Slide 28: Balance sheet
Net intangible assets 38,215,878 39,248,910 -1,033,032 -2.6% Net tangible assets 9,194,650 6,906,497 2,288,153 33.1% Equity holdings and other financial investments 277,808 751,110 -473,302 -63.0% Inventories 2,541,276 2,468,151 73,125 3.0% Trade receivables 37,172,859 29,485,759 7,687,100 26.1% Rec
Slide 29: Cash flow statement
2,231,713.45 3,425,494.00 Other adjustments Income taxes Interest received/(paid) -2,877,237.35 -2,300,042.00 1,178,782.06 1,946,632.00 (Income taxes paid) -1,042,422.32 -1,966,851.00 Financial charges/(income) (Decrease of severance provisions) -887,135.00 -788,578.00 3,027,096.35 2,300,042.00 Loss
Slide 30: Thank you
THANK YO STAR