Carel Industries Spa · MIL:CRL
Carel Industries Spa — FY2022 Earnings Presentation
42 slides from Carel Industries Spa's earnings presentation, Mar 2, 2023
Slide 1: 2022 – FY Results
CAREL INDUSTRIES S.p.A. 2022 – FY Results 2nd March 2023 This document and all of its contents are property of CAREL. All unauthorised use, reproduction or distribution of this document or the information contained in it, by anyone other than CAREL, is severely forbidden.
Slide 2: FY 2022 – Main achievements
FY 2022 – Main achievements • Completion of a new building in Croatia: additional 5,200 square-meters production plant to increase CAREL’s flexibility and capacity in order to support its development in Europe. • Completion of two new high-efficiency buildings in the HQ (Padua) with new offices, a n
Slide 3: FY 2022 – Highlights
FY 2022 – Highlights For the second consecutive year CAREL reported a FY revenue growth rate close to 30% maintaining a profitability higher than 20% and an NFP/EBITDA ratio <1x. Adding to this the strong effort in M&A activity (4 deals completed) and a continuous commitment in ESG. • On a like-for-
Slide 4: FY 2022 – Results
FY 2022 – Results KPIs FY 2022 Revenues bridge m€ FY 2021 FY 2022 Δ% 12.9 544.9 (1) 37.1 Revenue 420.4 544.9 29.6% 74.5 420.4 Revenue FX Adj. 420.4 532.0 26.5% Revenue (no M&A) 420.4 507.8 20.8% (2) EBITDA 85.3 111.7 31.0% (3) EBITDA adj. 88.2 114.7 30.1% EBITDA adj. Revenue 21.0% 21.1% m€ Net Profi
Slide 5: FY 2022 – Revenue breakdowns
FY 2022 – Revenue breakdowns Breakdown by region Breakdown by sector Other 1% South America 3% North America 13% HVAC 68% EMEA 70% 544.9 544.9 APAC Refrig. M€ 14% M€ 31% m€ m€ m€ m€ Area FY2021 FY2022 Δ% Δ% fx Sector FY 2021 FY2022 Δ% Δ% fx EMEA 302.3 382.7 26.6% 26.8% HVAC 270.0 371.9 37.7% 34.4% A
Slide 6: From EBITDA to Net Profit
From EBITDA to Net Profit K€ FY '21 FY '22 Δ% • Higher D&A mainly due to the purchase EBITDA 85,302 111,725 31.0% price allocation amortization D&A -20,844 -24,414 • Higher Financial charges due to the macro EBIT 64,457 87,311 35.5% trend on interest rates. • Fair value from options on minorities re
Slide 7: FY 2022 – NFP Bridge
FY 2022 – NFP Bridge 57.9 95.8 (6.0) 57.8 32.7€ from 27.6m€ IFRS 16 from IFRS 16 18.2 26.8 30.2 24.8 63.1 (64.8) 5.5 (24.4) m€ NFP Net Profit D&A Leasing/ NWC CAPEX Dividends M&A Other NFP FY 2021 rent fees FY 2022 • Robust cash generation covering ΔNWC, Capex, Dividends and partly M&A. • ΔNWC +24.8
Slide 8: ESG rating - Update
Bozza per la discussione ESG rating - Update • In October 2022 CAREL was upgraded to “AA” in the MSCI ESG Ratings assessment. This upgrade is part of a continuous improvement path which brought CAREL from “B” in 2019 to “AA” in 2022. • CAREL is now in the “ESG Leaders” category according to MSCI ESG
Slide 9: Closing Remarks
Closing Remarks • 2022 marked the substantial doubling in terms of revenues compared to 2018 (IPO). FY 2022 • Q4 2022 was the 8th consecutive quarter reporting a double-digit organic growth. This results is even Results more positive taking into consideration the contingent and temporary tightening
Slide 10: Annexes
Annexes
Slide 11: Shareholding structure (>3% voting rights)
Shareholding structure (>3% voting rights) CAREL Industries S.p.A. CAREL Industries S.p.A. Number of shares Voting rights Other Luigi Rossi Luciani Luigi Rossi Luciani Other Shareholders; Shareholders; S.a.p.a; 36.17% S.a.p.a; 44.90% 38.90% 24.15% 7 Industries B.V.; 6.12% 7 Industries B.V.; 4.93% At
Slide 12: Income statement and Balance Sheet
Income statement and Balance Sheet Income statement Balance sheet K€ FY 2022 FY 2021 Delta % FY 2022 K€ FY 2021 Delta % Revenues 544,852 420,418 29.6% Fixed Capital 300,499 230,338 30.5% Other revenues 5,780 5,779 0.0% Working Capital 89,926 55,591 61.8% Operating costs 438,906 340,895 28.8% Employe
Slide 13: Company Profile
Company Profile
Slide 14: Leading provider of advanced control solutions for HVAC/R
Leading provider of advanced control solutions for HVAC/R Key financials – 2022A • HVAC: Industrial, Residential, Growing key Commercial markets • Refrigeration: Food Retail and Revenue EBITDA EBITDA margin Net income Food Service €545m €112m ~20.5% €62m Leadership in • Control solutions premium +15
Slide 15: We operate in attractive niches across a wide range of end-markets
We operate in attractive niches across a wide range of end-markets… HVAC Refrigeration Industrial Residential Commercial Food Retail Food Service Data Centers Residential Shopping Centers Convenience Stores Restaurant Chains Industry and Process Office Space Hypermarkets Refrigerated Merchandisers P
Slide 16: One-stop-shop portfolio of components and platforms
…through a one-stop-shop portfolio of components and platforms Adiabatic humidifiers and Programmable controls HMI and unit terminals Parametric controls Isothermal humidifiers evaporative coolers Electronic controls easily programmable and customizable User interfaces for units and systems Entry le
Slide 17: Long track record of profitable growth
Long track record of profitable growth Revenue (€m) 545 420 327 332 280 255 203 231 1990s 2000A 2001A 2002A 2003A 2004A 2005A 2006A 2007A 2008A 2009A 2010A 2011A 2012A 2013A 2014A 2015A 2016A 2017A 2018A 2019A 2020A 2021A 2022A Adj. EBITDA (€m) 112 85 63 65 51 55 38 43 1990s 2000A 2001A 2002A 2003A
Slide 18: Well-articulated strategies to continue the growth track record
Well-articulated strategies to continue the growth track record • Consolidation of HVAC market leadership • Growth in Refrigeration driven by technology leadership • Upselling and cross-selling HVAC Refrigeration • Global penetration to consolidate to increase its market leadership market share • Co
Slide 19: Leading provider of advanced energy efficient control solutions
Leading provider of advanced energy efficient control solutions 1 High-tech leader in attractive niches of the HVAC/R industry 2 Attractive above market growth supported by secular trends Positioning and technological innovation capability hard to 3 replicate Highly efficient global operations servi
Slide 20: High-tech leader in attractive niches of the HVAC/R industry
1 High-tech leader in attractive niches of the HVAC/R industry Focus on attractive niches… …resulting in leadership positioning …CONSOLIDATED …INNOVATION-ORIENTED High value applications IN HVAC PREMIUM NICHES IN REFRIGERATION Deep knowledge of final applications is 39% #1 SIGNIFICANT ROOM FOR key E
Slide 21: Attractive market growth supported by secular trends
2 Attractive market growth supported by secular trends Secular trends… …supporting attractive market growth Reference HVAC and refrigeration Market GROWING • Improvement in LIVING STANDARDS POPULATION increasing demand for HVAC/R • Focus on WASTE REDUCTION in CHANGE IN food sector CONSUMER • Increas
Slide 22: Growth is driven by market trends and focused strategic actions
2 Growth is driven by market trends and focused strategic actions… Growth drivers SECULAR TRENDS Market Increasing the market of the applications addressed by CAREL trends NICHES EXPANSION Secular Leverage of deep knowledge of final trends applications to expand to adjacent niches Expansion to Incre
Slide 23: Favoured by up-selling and cross-selling
2 …and favoured by up-selling and cross-selling FROM PRODUCT PLATFORMS TO INTEGRATED ELECTRONIC SOLUTIONS… PRODUCT PLATFORMS SYSTEMS From a COMBINATION OF PRODUCTS FROM DIFFERENT PLATFORMS To an ECOSYSTEM TO QUICKLY ADOPT NEW TECHNOLOGIES …IN THE HVAC AND REFRIGERATION MARKETS HVAC Refrigeration Exa
Slide 24: Positioning and innovation capability hard to replicate
3 Positioning and innovation capability hard to replicate >5% OF REVENUE1 ~12% OF TOTAL WORKFORCE Invested annually in R&D dedicated to R&D 6 R&D CENTRES PROPRIETARY SOFTWARE COMBINING 5 DOMAINS Vast library of proprietary software modules UNIQUE 01100 • Hardware & Firmware developed over the past 1
Slide 25: Leadership position in HVAC OEM premium niches
3 Leadership position in HVAC OEM premium niches… Leadership positioning in premium …with no perfect comparable niches… Chiller European Market Share OEM Large 39% proprietary diversified EM / Low cost solutions competitors competitors 27% 14% 8% Vertical niche 5% 6% approach Innovation
Slide 26: Leading in innovation in the refrigeration market
3 …and leading in innovation in the refrigeration market Leveraging on HVAC experience… …CAREL is a leader in innovation Large diversified EM / Low cost competitors competitors 2014 HEOS SISTEMA Waterloop system with DC tech for refrigeration Vertical niche approach Innovation pace & 2015
Slide 27: Highly efficient global operations serving locally
4 Highly efficient global operations serving locally… NORTH AMERICA WESTERN EUROPE NORTH APAC GLOBAL PRODUCTION FOOTPRINT 1 9 Plant Plants 232 1,220 Employees Employees DIRECT AND HIGHLY SKILLED SALES NETWORK 74 x3 201 Sales force Sales force 1 85 x3 Plant Sales force 2 3 BEST POSITIONED TO CAPTURE
Slide 28: Diversified blue-chip customers
4 …diversified blue-chip customers HVAC REFRIGERATION GLOBAL BLUE-CHIP APAC 14% EMEA >10,000 <4% South America 70% Customers 3% BROAD & HIGHLY from first customer1 DIVERSIFIED In c. 100 ~20% North America 13% countries worldwide from top-15 customers2 2022A revenue LONG-TERM ~80% ~70% BUSINESS of To
Slide 29: Track record of profitable growth
5 Track record of profitable growth Double-digit growth Strong profitability High conversion to net income Cash generative business Revenue1 (€m) EBITDA1 (€m) Net Income1 (€m) Operating cash2 (€m) 60 555 112 62 53 50 45 85 49 420 40 327 332 63 65 35 35 28 280 31 31 24 51 255 47 21 231 43 25 203 38 2
Slide 30: Global expansion, innovation and services
6 A Global expansion, innovation and services Pursuing additional Consolidation of opportunities leadership positions improving services in HVAC offer with IoT and Growth in advanced Refrigeration monitoring solutions Geographical Cross-selling and up- expansion through selling exploiting the introd
Slide 31: Pursuing external growth through disciplined bolt-on M&A
6 Pursuing external growth through disciplined bolt-on B M&A CAREL has performed detailed analyses and scouting of potential targets, thus promoting an opportunistic approach with a focus on 3 MAIN EXPANSION AREAS: A B C COMPLEMENTING GEOGRAPHICAL Potential selected CORE-BUSINESS EXPANSION, mainly a
Slide 32: M&A
M&A
Slide 33: M&A – 2022 – Senva
M&A – 2022 – Senva • Key Data: Enterprise value (100%) = 34-38m€ 2021 Revenues = ~13m USD EBITDA (TTM) = 3.1m USD Employees = ~65 • Industrial fitting: Bolt-on acquisition Strong complementarity with CAREL’s product line-up • Company profile: SENVA is a US company located in Oregon speci
Slide 34: M&A – 2022 – Klingenburg
M&A – 2022 – Klingenburg • Key Data: Enterprise value (100%) = 12m€ 2021 Revenues = ~30m€ EBITDA = 2.4m€ Employees = ~200 • Industrial fitting: Bolt-on acquisition Strong complementarity with Recuperator’s product line-up • Company profile: Klingenburg GmbH and Klingenburg International
Slide 35: M&A – 2022 – Sauber
M&A – 2022 – Sauber • Key Data: Equity value (70%) = 3.6m€ 2021 Revenues = 7.6m€ EBITDA = 0.8m€ Employees = ~55 • Industrial fitting: Bolt-on acquisition Strong know-how in on-field services and energy savings • Company profile: Sauber is based in Porto Mantovano (Mantua) and is active
Slide 36: M&A – 2022 – Arion
M&A – 2022 – Arion • Key Data: Equity value (30%) = 1.2m€ 2021 Revenues = 2.7m€ 2020 EBITDA = 0.5m€ Employees = 6 • Industrial fitting: Bolt-on acquisition Enabler of digital services Focus on those applications presenting higher growth trends Secure supply-chain in critical • Compan
Slide 37: M&A – 2021 – CFM
M&A – 2021 – CFM • Key Data: Enterprise value (51%) = 23.1m€ 2020 Revenues = 14.5m€ EBITDA = 5.0m€ Employees = ~34 • Industrial fitting: Bolt-on acquisition Footprint expansion outside Western Europe Strong know-how in digital and on- field services • Company profile: a long-standing d
Slide 38: M&A – 2021 – Enginia
M&A – 2021 – Enginia • Key Data: Enterprise value* = 12.4m€ 2020 Revenues = 12.3m€ 2020 EBITDA = 1.5m€ Employees = 46 • Industrial fitting: Bolt-on acquisition Completing CAREL’s product range for AHU Significant synergies with CAREL/Recuperator • Company profile: Enginia has been oper
Slide 39: M&A – 2018 – Recuperator
M&A – 2018 – Recuperator • Key Data: Cash-out for equity = 25.7m€ Company positive net-cash = 6.9m€ 2017 Revenues = 16.4m€ EBITDA = 1.7m€ Employees = ~60 • Industrial fitting: Small-size Company Complementary products Carel’s commercial strength Cross-selling • Financial fitting:
Slide 40: M&A – 2018 – HygroMatik
M&A – 2018 – HygroMatik • Key Data: Cash-out for equity = 56.1m€ Enterprise Value = 59.0m€ 2017 Revenues = 15.0m€ EBITDA = 4.7m€ Employees = ~60 • Industrial fitting: Small-size Company Interesting geographic positioning Strong in after-sale services Cross-selling • Financial fitti
Slide 41: Disclaimer
Disclaimer This document has been prepared by CAREL Industries S.p.A for use during meetings with investors and financial analysts and is solely for information purposes. The information set out here in has not been verified by an independent audit company. Neither the Company nor any of its subsidi
Slide 42: This document and all of its contents are property of CAREL. All unauthorised use,
42 This document and all of its contents are property of CAREL. All unauthorised use, reproduction or distribution of this document or the information contained in it, by anyone other than CAREL, is severely forbidden.