Slide 1: Q4 Report 2018
Q4 Report 2018 Mattias Perjos, President and CEO Lars Sandström, CFO January 30, 2019
Slide 2: Key takeaways – performance
Key takeaways – performance Q4 2018 60 • Sales growth continues 48.0 Gross Margin (adj) • Growth outlook is unchanged 40 • Early signs of improved margins 17.9 20 EBITA Margin (adj) • Stable Cash Flow in a growth quarter • Proposed dividend: SEK 1.00 per share (1.50) Q1 2017 Q2 2017 Q3 2017 Q4 2017
Slide 3: Key takeaways – events
Key takeaways – events Q4 2018 • Wayne and Merrimack sites are remediated • No new material information on Brazil, Mesh litigations and FDA Warning Letter • New product launches and updates • Stéphane Le Roy new President for Surgical Workflows Getinge Year End Report 2018 January 30, 2019 Page 3
Slide 4: Organic net sales growth continues
Organic net sales growth continues Order intake decrease vs Q4 2017 due to temporary decline in Surgical Workflows and emerging markets in EMEA Americas EMEA APAC Global Net sales +2.4% Order intake -3.1% (organic) *Organic net sales Getinge Year End Report 2018 January 30, 2019 Page 4
Slide 5: Contribution in order intake Q4 2018
Contribution in order intake Q4 2018 Challenging comparison (+6.6% organic growth Q4 2017) and temporary decline in Surgical Workflows and emerging markets in EMEA Organic change +0.9% +2.3% -9.5% -3.1% 48 -139 196 6,729 MSEK 6,624 Q4 2017 Acute Care Therapies Life Science Surgical Workflows Q4 2018
Slide 6: Contribution in net sales Q4 2018
Contribution in net sales Q4 2018 Growth in all business areas – capital goods still growing faster than consumables Organic change +0.3% +15.5% +2.3% +2.4% 196 +342 Currency impact, MSEK 129 194 2.8% 7,890 2.3% Organic growth, % 7,371 MSEK Q4 2017 Acute Care Life Science Surgical Workflows Q4 2018
Slide 7: Gross Margin development Q4 2018
Gross Margin development Q4 2018 Margin supported by volume growth but negatively impacted by currency effects and product mix Adj Gross margin,% 59.9 35.9 36.9 48.0 (Q4 2017) (58.8) (39.6) (38.6) (48.7) 21 Gross margin impact 24 Volume 154 3,790 Currency 3,591 MSEK Product mix Regional mix Q4 2017
Slide 8: Financial development
Financial development Getinge Year End Report 2018 January 30, 2019 Page 8
Slide 9: Adjusted EBITA bridge Q4 2017 – Q4 2018
Adjusted EBITA Bridge Q4 2017 – Q4 2018 18.7% Margin decrease 0.8% 17.9% +35 -0.7 pp Currency +0.1 pp GP -63 -0.3 pp OPEX -91 -14 4 +0.1 pp Depreciation 199 MSEK 1,377 1,412 Q4 2017 Gross profit Selling Admin R&D Other incl Q4 2018 D&A on acq intangible assets Getinge Year End Report 2018 January 30
Slide 10: Adjusted EBITA bridge Q4 2017 – Q4 2018
Adjusted EBITA Bridge Q4 2017 – Q4 2018 28 +35 +6 Currency -143 -32 impact, MSEK 182 MSEK 1,377 1,412 Q4 2017 Acute Care Life Science Surgical Workflows Common Group Q4 2018 Therapies Functions and other (incl eliminations) Getinge Year End Report 2018 January 30, 2019 Page 10
Slide 11: Control on OPEX
Control on OPEX Trend break: FTE’s and OPEX in relation to Net Sales Trend break in FTE’s Adj OPEX in relation to Net sales, R12 11,000 33.8 10,900 33.4 10,800 -277 33.0 10,700 10,600 32.6 10,500 10,400 300 200 18-Sep 18-Mar 18-Jun 17-Dec 18-Dec Q1 Q2 Q3 Q4 FTE’s Adjusted OPEX/Net Sales 2018 (%) R12
Slide 12: Stable cash flow development
Stable cash flow development Q4 2018 and FY 2018 • Cash flow from operating activities in Q4 Oct-Dec Oct-Dec Jan-Dec Jan-Dec amounted to SEK 684 M and cash flow after net SEK M 2018 2017 2018 2017 investments amounted to SEK 321 M. Cash flow before changes in working capital 1 181 1 337 2 641 3 653
Slide 13: Stable cash flow development
Stable cash flow development Working capital growing slower than sales on a yearly basis Trend break in Working Capital Growth: Sales vs Working Capital CF after net investments, MSEK 132 4.9 1,130 1,168 130 128 126 2.8 124 122 4 2 0 18-Sep 18-Mar 18-Jun 17-Dec 18-Dec Working Capital Net Sales growt
Slide 14: Outlook
Outlook Getinge Year End Report 2018 January 30, 2019 Page 14
Slide 15: Outlook 2019
Outlook 2019 2-4% Organic Net Sales Growth Getinge Year End Report 2018 January 30, 2019 Page 15
Slide 16: Summary
Summary Getinge Year End Report 2018 January 30, 2019 Page 16
Slide 17: Key takeaways
Key takeaways Summary Q4 2018 • Sales growth continues • Growth outlook is unchanged • Early signs of improved margins • Stable Cash Flow • The acitivities to improve margins and cash flows continues Getinge Year End Report 2018 January 30, 2019 Page 17
Slide 18: Q&A
Q&A Getinge Year End Report 2018 January 30, 2019 Page 18
Slide 19: Thank you
Thank you Getinge Year End Report 2018 January 30, 2019 Page 19
Slide 20: Appendix – Business Information
Appendix – Business Information Getinge Year End Report 2018 January 30, 2019 Page 20
Slide 21: Getinge today
Getinge today Leading positions in well defined segments Enabling advanced healthcare 170 BSEK Addressable market 90% where it matters the most CSSD* 2-4% Cath Operating ICU Organic growth in Hospitals represent 90 % of sales, Lab Room addressable market 10% goes to Pharma, Lab & Medtech The value
Slide 22: In these trends lie significant opportunities
In these trends lie significant opportunities Changing demographics More people, older and sicker Value based health care Macroeconomics New business and payment models ”More-for-less” Digitalization & Connectivity Healthcare systems Knowledge & value conscious healthcare Digital surgery Innovation
Slide 23: Strong fundamentals in our business
Strong fundamentals in our business Long term growth opportunities US and Emerging Markets represent Market growth Share of Getinge’s the highest underlying growth expectations per segment* Net Sales 2018 Addressable Americas EMEA APAC Acute Care 75 BSEK 50 BSEK 45 BSEK Therapies 2-4% 54% market Sur
Slide 24: US represents the largest market and growth opportunity
US represents the largest market and the largest growth opportunity for Getinge 34,2% 6,2% 6,1% 5,3% 4,6% 3,3% 2,9% 2,7% 2,4% 2,3% USA Germany China Japan France Great Britain Australia Italy India Sweden Getinge Year End Report 2018 January 30, 2019 Page 24
Slide 25: Build to last – step by step
Build to last – step by step Effective and sustainable change is built upon a Strategy-Structure-Systems-Skills wave iteration Strategy Structure Systems Skills Getinge Year End Report 2018 January 30, 2019 Page 25
Slide 26: Structured to optimize outcome from strategy
Structured to optimize outcome from strategy Balanced BA led organization – ensuring accountability and synergies Acute Care Life Surgical Therapies Science Workflows Governance Business synergy functions Sales Getinge Year End Report 2018 January 30, 2019 Page 26
Slide 27: Factory footprint
Factory footprint Sweden Solna – Ventilators and anesthesia machines Växjo – Disinfection equipment Getinge – Sterilization equipment China Germany Suzhou – Surgical tables, cardiovascular Hechingen – Consumables for perfusion products products, and disinfection and sterilization Rastatt – Surgical
Slide 28: Reignite growth, improve margins and cash flows
Reignite growth, improve margins and cash flows Step 1 Step 2 Re-ignite growth Productivity Actions taken in 2017 Global QMS and ERP supporting growth in 2018 to ensure compliance and drive synergies Innovation and portfolio management to ensure pricing power and productivity in the value chain Harm
Slide 29: Getinge's financial targets
Getinge’s financial targets Dividend Organic Earnings policy net sales Per Share 2-4% 2-4% annual average growth >10% 30-50% average growth average growth of net income Getinge Year End Report 2018 January 30, 2019 Page 29
Slide 30: Forward looking information
Forward looking information This document contains forward-looking information based on the current expectations of the Getinge’s management. Although management deems that the expectations presented by such forward-looking information are reasonable, no guarantee can be given that these expectation
Slide 31: GETINGE
Se a GETINGE PASSION FOR LIFE