Oc Oerlikon Corporation Ag · SIX:OERL
Oc Oerlikon — FY2022 Earnings Presentation
25 slides from Oc Oerlikon's earnings presentation, Feb 21, 2023
Slide 1: 2022 Financial Results
2022 Financial Results 21 February 2023 Page 1
Slide 2: Agenda
Agenda 1 Market & Strategy Overview 2 Financials & Outlook 3 Q&A Page 2
Slide 3: Oerlikon positioned for mid-term growth
Oerlikon positioned for mid-term growth Strategic Cutting-edge Leveraging core positioning technology competencies into new areas Market leader in Luxury sweet spots #1 Market leader E-mobility & TIS 1) in coating solutions High technology Semiconductors entry barriers Small cost on customers’ bill
Slide 4: Summary 2022
Summary 2022 Strong execution in 2022 – prepared Oerlikon for weaker filament demand Financials +7% (3.0bn) +10% (2.9bn) +10% (498m) +16% (277m) 2022 Order intake Sales Operational EBITDA Operational EBIT ▪ Growth supported by both Divisions: Polymer Processing Solutions with record sales and contin
Slide 5: 2022/23 macro challenges impacting Oerlikon's outlook
2022/23 macro challenges impacting Oerlikon’s outlook Toxic combination of … weighing on industrial production macro challenges … Euro Area manufacturing PMI High inflation + 50 >2 years of lockdowns in China US manufacturing PMI + Impacting Oerlikon’s Energy security outlook 50 + Supply chain bottl
Slide 6: Challenging end markets
Challenging end markets Polymer Processing Solutions Surface Solutions Filament Non-Filament General Ind. & Tooling Automotive Aviation 33% of 2022 Group sales 20% 28% 13% 6% 2022 markets 2023E markets 2022 2023E 2022 2023E 2022 2023E 2022 2023E ▪ Strong demand in H1’22; macro ▪ Flow Control benefit
Slide 7: Continued focus on strategy execution despite macro headwinds
Continued focus on strategy execution despite macro headwinds Grow & Drive sustainability Improve diversify progress profitability +23% growth in Americas 1): New Improving towards ‘low risk’ ESG ratings, 10% operational ROCE representing YoY geographical organization introduced ahead of industrial
Slide 8: Focus on growth and diversification
Focus on growth and diversification Demand driven by sustainability and efficiency Sales ▪ Geographic expansion in Americas 1.50-1.55 1.38 (2022: +23%) and Asia (+5%) Riri Surface 1.20 1.28 supported by new organization Solutions industr. act. Weakening ▪ Leveraging core competencies into new areas:
Slide 9: Leveraging core competencies into luxury
Leveraging core competencies into luxury 1 2 3 Oerlikon with PVD Expanded into luxury Riri - a perfect fit technology leadership with Coeurdor in 2021 for luxury offering ▪ Oerlikon PVD coating portfolio one of largest ▪ Acquired Coeurdor in 2021, a manufacturer of ▪ Leading provider of coated metal
Slide 10: Continued positive momentum in ESG driving growth
Continued positive momentum in ESG driving growth Sustainability rating upgrades MSCI EcoVadis Sustainalytics ISS ESG AA 61 21 52 Silver med C low 44 28 risk A A risk Bronze 33 D+ no high med D+ mid mid medal risk risk risk risk ESG Sector Previous Current Sector Previous Current Sector Previous Cur
Slide 11: Financials & Outlook
Financials & Outlook Philipp Müller CFO
Slide 12: 2022 financial overview
2022 financial overview 2022 with sales and operational EBITDA growth, supported by both Divisions +6.9% ▪ Order intake +11% YoY in 2022 (FX adj.), driven by both FX adj.: +10.6% 2’990 Orders Divisions; including +3% from M&A 1) 2’797 ▪ Q4 roughly stable YoY (+4% FX adj.) 2021 2022 ▪ Sales +14% in 2
Slide 13: Improving profitability
Improving profitability ▪ 22% overhead savings since 2019, Administration expenses m while generating CHF ~300m more -22% sales 276 Cost 229 216 217 1 efficiency ▪ Q4’22 with portfolio optimization (inline ePD exit) and proactive cost 10.6% of sales 7.4% of sales actions ahead of macro headwinds 201
Slide 14: Surface Solutions growth supported by new organization
Surface Solutions growth supported by new organization Markets Orders Sales Operational EBITDA ▪ Market recovery impacted by ▪ Increased +9% FX adjusted supported ▪ Improved +11% FX adjusted, including ▪ Higher EBITDA; margin transitorily customers’ supply chain shortages in H1 by market recovery (H
Slide 15: Polymer Processing Solutions with 15% EBITDA growth
Polymer Processing Solutions with 15% EBITDA growth Markets Orders Sales Operational EBITDA ▪ Filament with strong demand in H1; ▪ Improved +12% in 2022 (FX adj.), ▪ Increased +12% (FX adj. +16%), driven ▪ Increased +15% in 2022; improved weakening macro environment in H2 representing largest order
Slide 16: Focus on Cash Flow and ROCE
Focus on Cash Flow and ROCE Operating FCF Underlying impacted by Net Working Capital ROCE improving 2022 ▪ Operating FCF transitorily impacted by NWC 2022 ▪ Reached 10% operational ROCE 1) ▪ NWC increase due to higher raw material ▪ Reported ROCE impacted by one-offs, impairment and 418 prices, busi
Slide 17: Focus on Balance Sheet
Focus on Balance Sheet Net debt / Equity ratio operational EBITDA 0.9 Commitment to 33% maintaining balance sheet strength ▪ Senior unsecured bond of CHF 125m matured in Nov. 2022; no replacement required due to cash repatriation from China, resulting in a tax effect (timing) 2) ▪ Acquisition of Rir
Slide 18: 2023 Guidance
2023 Guidance 2023 with transitory headwinds from customers’ postponed investment decisions and input cost inflation Sales 1) Operational EBITDA margin ▪ Sales stable at constant FX; Riri acquisition offset primarily +1% by customers’ postponed investment decisions in Polymer Riri: 100-150 Processin
Slide 19: cerlikon
cerlikon
Slide 20: Appendix
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Slide 21: 2022 reconciliation of profitability measures
2022 reconciliation of profitability measures EBITDA to EBIT bridge Group Surface Solutions Polymer Processing Solutions in CHF million FY 22 FY 21 FY 22 FY 21 FY 22 FY 21 418 444 226 232 193 208 Impairment of tangible and EBITDA 1 intangible assets mainly Depreciation -131 -133 -100 -106 -29 -24 re
Slide 22: Q4 reconciliation of profitability measures
Q4 reconciliation of profitability measures EBITDA to EBIT bridge Group Surface Solutions Polymer Processing Solutions in CHF million Q4' 22 Q4' 21 Q4' 22 Q4' 21 Q4' 22 Q4' 21 55 129 49 58 5 75 Impairment of tangible and EBITDA 1 intangible assets mainly Depreciation -32 -34 -24 -26 -7 -7 related to
Slide 23: Return on Capital Employed (ROCE)
Return on Capital Employed (ROCE) 2021 2022 Based on 12.1% operational EBIT and adj. for tax effect of cash EBIT 220 176 repatriation 10.0% - Total current income tax -66 -89 - Total deferred income tax 11 20 8.2% 7.6% NOPAT 165 107 7.0% 5.7% Net Operating Assets 2'204 2'063 5.3% + Current income ta
Slide 24: Investor Relations
Investor Relations Stephan Gick Stephan.gick@oerlikon.com +41 58 360 98 50 Peter Dickson Peter.dickson@oerlikon.com +41 58 360 96 39 ir@oerlikon.com www.oerlikon.com/en/investors
Slide 25: Disclaimer
Disclaimer OC Oerlikon Corporation AG, Pfäffikon, (together with its affiliates hereinafter referred to as “Oerlikon”) has made great efforts to include accurate and up-to-date information in this document. However, Oerlikon makes no representation or warranties, expressed or implied, as to the trut