Tecan Group Ag · SIX:TECN
Tecan — H1 2020 Earnings Presentation
30 slides from Tecan's earnings presentation, Aug 12, 2020
Slide 1: Half Year Results 2020
Zurich, August 12 2020 Half Year Results 2020 ANALYST & MEDIA CONFERENCE CALL
Slide 2: Speakers
Speakers Dr. Achim von Leoprechting, CEO Tania Micki, CFO
Slide 3: Agenda
Agenda FINANCIAL AND OPERATING HIGHLIGHTS FINANCIAL RESULTS OUTLOOK QUESTIONS AND ANSWERS 3
Slide 4: Financial Highlights H1 2020
Financial Highlights H1 2020 • Surge in orders, with order entry up by 24.3% in LC and 20.4% in CHF; order backlog at record high • Strong sales growth of +8.0% in LC and +4.7% in CHF; pronounced headwinds and tailwinds from the coronavirus pandemic • Both business segments contributing to growth; p
Slide 5: Operating Highlights H1 2020
Operating Highlights H1 2020 • Activated Pandemic Plan and implemented various measures and safety protocols at all sites • Health and safety of Tecan employees ensured during the coronavirus pandemic • Global manufacturing and business operations secured, particularly for scaled up global COVID-19
Slide 6: Examples of Global COVID-19 Testing: China & South Korea
Examples of Global COVID-19 Testing: China & South Korea SUPPORTING IVD COMPANIES AND INDIVIDUAL LABS WITH INSTRUMENTS, COMPONENTS AND CONSUMABLES LIFE SCIENCES BUSINESS PARTNERING BUSINESS • The Tecan field-based team successfully finished • Starting in Q1, Tecan supported local IVD companies in Ch
Slide 7: Examples of Global COVID-19 Testing: Australia & Israel
Examples of Global COVID-19 Testing: Australia & Israel SUPPORTING IVD COMPANIES AND INDIVIDUAL LABS WITH INSTRUMENTS, COMPONENTS AND CONSUMABLES LIFE SCIENCES BUSINESS - AUSTRALIA LIFE SCIENCES BUSINESS - ISRAEL • The Australian Government together with partners • The Weizmann Institute of Science
Slide 8: Examples of Global COVID-19 Testing: UK Biocentre
Examples of Global COVID-19 Testing: UK Biocentre SUPPORTING IVD COMPANIES AND INDIVIDUAL LABS WITH INSTRUMENTS, COMPONENTS AND CONSUMABLES LIFE SCIENCES BUSINESS • In a response to COVID-19, the UK Government • The UK Biocentre is a government-funded, not-for-profit constructed the Lighthouse Labs
Slide 9: Examples of Global COVID-19 Testing: Cavro Components
Examples of Global COVID-19 Testing: Cavro Components SUPPORTING IVD COMPANIES AND INDIVIDUAL LABS WITH INSTRUMENTS, COMPONENTS AND CONSUMABLES PARTNERING BUSINESS – CAVRO COMPONENTS AusDiagnostics, Sydney (AUS) Codex DNA, San Diego (USA) • AusDiagnostics, a Tecan customer and OEM partner, • The Cod
Slide 10: Examples of Global COVID-19 Testing …and many more!
Examples of Global COVID-19 Testing SUPPORTING IVD COMPANIES AND INDIVIDUAL LABS WITH INSTRUMENTS, COMPONENTS AND CONSUMABLES …and many more! Sources: see p27 10
Slide 11: Agenda
Agenda FINANCIAL AND OPERATING HIGHLIGHTS FINANCIAL RESULTS OUTLOOK QUESTIONS AND ANSWERS 11
Slide 12: Order Entry and Sales Performance
H1 2020 Order Entry and Sales Performance ORDER ENTRY H1 2020 ORDER ENTRY H1 2020 VS. H1 2019 390 374.0 370 • +20.4% in CHF, +24.3% in LC 350 • Orders surged for product lines supporting the global fight CHF (mio) 330 310.6 against COVID-19 (instruments and consumables) 310 290 • Significantly excee
Slide 13: Segment Sales
H1 2020 Segment Sales SALES 180 2019 LIFE SCIENCES BUSINESS: 169.4 2020 162.4 • Sales up by 4.3% in CHF and 9.0% in LC 160 • Strong demand for products supporting the COVID-19 CHF (mio) 140.6 140 133.7 response (automation workstations and pipette tips) 120 • Other parts experienced significant slow
Slide 14: Regional Sales Development
H1 2020 Regional Sales Development EUROPE YoY % Others 1.8% • Growth driven by Life Sciences Business with various larger +25.3% in LC instrument installations for PCR-based COVID-19 testing +18.4% in CHF • Sales of Partnering Business suffered from lower volumes in routine diagnostic testing Asia N
Slide 15: Gross Profit
H1 2020 Gross Profit GROSS PROFIT (% = % OF SALES) GROSS PROFIT INCREASED TO CHF 146.1M 160 • CHF 5.1m or 3.6% above H1 2019 146.1 GROSS PROFIT MARGIN DOWN BY 50BPS 141.0 Main effects contributing: • (-) Higher freight and logistics cost mainly due to less CHF (mio) capacity available • (-) Underabs
Slide 16: Cost Structure
H1 2020 Cost Structure OPERATING EXPENSES (% = % OF SALES) OPERATING EXPENSES GREW LESS THAN SALES 120 108.0m 103.5m (36.5%) (33.4%) • Operating expenses down by 310 bps 100 • Sales & Marketing grew in line with sales 46.9 80 (15.8%) (16.0%) 48.6 • R&D increased less than sales (15.7%) (15.5%) • Con
Slide 17: EBIT and EBITDA
H1 2020 EBIT and EBITDA EBIT AND EBITDA (IN CHF MILLIONS) 2019 REPORTED EBITDA GREW TO CHF 60.2M 70 60.2 2020 • CHF 10.9m or 22.0% above H1 2019 60 • (+) More development costs were capitalized CHF (mio) 49.3 50 42.6 • (+) Several cost items lower, delayed or will be shifted to H2 40 33.0 due to loc
Slide 18: Segment Profitability
H1 2020 Segment Profitability EBIT (IN CHF MILLIONS) 2019 LIFE SCIENCES BUSINESS: 30 26.3 25.0 2020 • EBIT margin at 12.6% 25 22.5 19.0 • Factors contributing include: CHF (mio) 20 15 • (+) Volume effect 10 • (+) Lower net R&D expenses (higher capitalization) 5 • (-) Higher freight and logistics cos
Slide 19: Net Profit
H1 2020 Net Profit NET PROFIT NET PROFIT HIGHER THAN PRIOR YEAR 40 • CHF10.7M or 42.2% above H1 2019 36.0 35 NET PROFIT MARGIN AT 11.6% 30 29.2 • Main factor contributing: 26.0 25.3 • (+) EBIT up by CHF 9.6m CHF (mio) 25 23.5 • (+) Lower tax rate of 12.8% in connection with the tax reform in Switzer
Slide 20: Basic Earnings per Share
H1 2020 Basic Earnings per Share BASIC EARNINGS PER SHARE EARNINGS PER SHARE AT CHF 3.02 3.5 NUMBER OF SHARES OUTSTANDING ON 3.02 JUNE 30, 2020: 11.9M (JUNE 30, 2019: 11.8M) 3 2.49 2.5 2.25 CHF (mio) 2.04 2.14 2 48.8% 49.5% 48.8% 49.5% 1.5 1 0.5 0 2016 2017 2018 2019 2020 20
Slide 21: Cash Flow
H1 2020 Cash Flow +82.8 266.3 -130.6 189.7 -28.8 Cash at end From Operations From Investments From Financing1 Cash at end of December 2019 of June 2020 CASH FLOW FROM OPERATIONS OF CHF 82.8M (H1 2019: CHF 36.0M) • Cash conversion of 26.7% of sales (H1 2019: 12.1%) • Strong focus on cash collection a
Slide 22: Key Figures
H1 2020 Key Figures 2019 2020 Δ IN % Order Entry (in CHF mio) 310.6 374.0 +20.4% Sales (in CHF mio) 296.1 310.0 +4.7% Sales in local currencies (in CHF mio) 287.0 310.0 +8.0% Gross Profit (in CHF mio) 141.0 146.1 +3.6% in % of sales 47.6% 47.1% R&D (in CHF mio) 29.6 25.3 -14.3% in % of sales 10.0% 8
Slide 23: Agenda
Agenda FINANCIAL AND OPERATING HIGHLIGHTS FINANCIAL RESULTS OUTLOOK QUESTIONS AND ANSWERS 23
Slide 24: Agreement with Thermo Fisher Scientific
Agreement with Thermo Fisher Scientific LEVERAGING TECAN’S AUTOMATION TECHNOLOGY TO ENABLE SCALED-UP COVID-19 TESTING GLOBALLY THERMO FISHER SCIENTIFIC AMPLITUDE SOLUTION • Thermo Fisher Scientific is introducing a new highly automated, real-time PCR solution • The Thermo Fisher Scientific Amplitude
Slide 25: Raising Financial Outlook for 2020
Raising Financial Outlook for 2020 SALES DEVELOPMENT OUTLOOK 2020 700 HSD • Based on H1 performance, the high order backlog and the growth in 650 636.8 LC1 anticipated demand in H2, outlook for FY 2020 is raised 600 593.8 • Due to the ongoing pandemic, the outlook is still subject to CHF (mio) 548.6
Slide 26: Celebrating years of Tecan
UW) = P S 2 Se Celebrating 40 years of Tecan. os PITTI IPI PEPE PPP PPP ee )|)|>6 @TECAN.
Slide 27: Contact and Events
Contact and Events IR IPAD APP News, financial reports, presentations, videos and more NEXT EVENTS 2021 CONTACT Martin Braendle March 16: Full Year Results Senior Vice President, Corp. Communications & IR Phone: +41 (0) 44 922 84 30 April 13: Annual Shareholder Meeting investor@tecan.com www.tecan.c
Slide 28: Sources for COVID-19 Examples
Sources for COVID-19 Examples p7: Australia https://www.health.gov.au/ministers/the-hon-greg-hunt-mp/media/ground-breaking-partnership-delivers-10-million-covid-19-tests-and- equipment#:~:text=The%20Hon%20Greg%20Hunt%20MP&text=29%20April%202020- ,In%20a%20ground%20breaking%20and%20critically%20impor
Slide 29: Then and now: years of human discovery
Then and now: 40 years of human discovery.
Slide 30: Tecan – Who we are
Tecan – Who we are Tecan (www.tecan.com) is a leading global provider of laboratory instruments and solutions in biopharmaceuticals, forensics and clinical diagnostics. The company specializes in the development, production and distribution of automated workflow solutions for laboratories in the lif