Eltel Ab · OMXSTO:ELTEL

Eltel Ab — Q1 2019 Earnings Presentation

19 slides from Eltel Ab's earnings presentation, April 2019

  1. Slide 1: Eltel AB Investor presentation

    Eltel AB Investor presentation April, 2019 1

  2. Slide 2: Eltel in brief

    Eltel in brief Founded in 2001 Northern European market leader Operations throughout the Nordics, Poland and Germany Net sales EUR 1.2 billion, 7,200 employees UN Global Compact signatory since 2014 Listed on Nasdaq Stockholm since 2015 2

  3. Slide 3: Focus on segments

    Focus on segments Net sales Q1 2019 Power and Communication 6% 2% 10% 31% The Nordics, Poland and Germany 11% Grow in line with market, capitalise on trends, improve operational processes, 20% 20% make selective acquisitions, increase efficiency Sweden Finland Norway Denmark Poland Germany Other cou

  4. Slide 4: Eltel’s business

    Eltel’s business – driven by stable customers with long term investment needs Segments Drivers Power  Regulatory demands  Outsourcing  Ageing infrastructure  Increasing end-customer demands Communication  Technical shift 4

  5. Slide 5: Eltel AB Q1 2019 Presentation

    Eltel AB Q1 2019 Presentation 26 April 2019 5

  6. Slide 6: Q1 2019 highlights

    Q1 2019 highlights  Operational improvements  Improved Operative EBITA  Lower volumes in Smart Grids  Future Nordic focus 6

  7. Slide 7: Total Group: Q1

    Total Group: Q1  Net sales -5.9% to EUR 251.0 million (266.6)  Organic growth in Power and Communication* -2.0% Total Group  Operative EBITA EUR -3.0 million (-7.6)  Operative EBITA margin -1.2% (-2.9%) *Adjusted for divested operations and currency effects 7

  8. Slide 8: Group: Operative EBITA development

    Group: Operative EBITA development 10.0 2.0% 5.0 1.0% 0.0 0.0% -5.0 -1.0% -10.0 -2.0% -15.0 -3.0% -20.0 -4.0% -25.0 -5.0% Q1-17 Q2-17 Q3-17 Q4-17 Q1-18 Q2-18 Q3-18 Q4-18 Q1-19 Operative EBITA, quarter Operative EBITA margin, rolling 12 months 8

  9. Slide 9: Net sales segments: Q1

    Net sales segments: Q1  Net sales -9.1% to EUR 87.0 million  Lower volumes in Finland and Smart Grids Power  Increased volumes in High Voltage Poland  Organic net sales* -8.1%  Net sales -0.6% to EUR 161.4 million  Lower volumes in Sweden and currency effects Communication  Increased volumes

  10. Slide 10: Operative EBITA segments: Q1

    Operative EBITA segments: Q1  Operative EBITA EUR -4.2 million (-1.3)  Operative EBITA margin -4.8% (-1.4) Power  Lower net sales in Smart Grids  Lower gross margin and higher costs in High Voltage Nordics and Poland  Operative EBITA EUR 4.6 million (1.1)  Operative EBITA margin 2.9% (0.7) Com

  11. Slide 11: Focus in 2019

    Focus in 2019 Operational focus  Tender  Right people  Implementation & execution  No. 1 Nordic player  Production planning  High customer satisfaction  Training  Lower risk and fewer capital intensive projects Strategic focus  Cash generation  Evaluation of strategic  Lower net debt alte

  12. Slide 12: Our long-term plan

    Our long-term plan >2022 “Investing in sustainable profitable growth” 2019-2021 “Operational excellence” 2017-18 “House in order”  Continued focus on operational excellence  Pursue structural M&As in  Prioritise core operational the Nordics when financial improvements (operational situation impro

  13. Slide 13: Financial targets

    Financial targets Medium to long-term target Annual growth of 2-4%, including Growth selective acquisitions EBITA-margin EBITA-margin of at least 5% Cash conversion Cash conversion of 95-100% of EBITA Capital structure Leverage of 1.5-2.5x net debt/EBITDA 13

  14. Slide 14: Appendices

    Appendices 14

  15. Slide 15: Our services – in business segments

    Our services – in business segments Power Communication Other Market leading Market leader in the Includes businesses position in Poland Nordic region under ramp down and Finland 37% 61% and discontinuation 2% Markets Markets Markets Nordics, Poland, Germany Nordics, Lithuania, Poland, Germany Outsi

  16. Slide 16: Our core markets with a foreseen market growth of almost 3%

    Our core markets with a foreseen market growth of almost 3% Sales split 2018 Core markets of Eltel 2% CAGR 2022f 6% Market +3% 8% size (2019E): 30% EUR 11.6bn 9% 22% 23% Sweden Finland Norway Denmark Poland Germany Other countries Source: Company information, management estimates 16

  17. Slide 17: Eltel’s segments

    Eltel’s segments – built on core competences with solid market position Services split (2018A) Projects Power incl. roll-  Maintenance outs 26% Maintenance 27%  Upgrades  Projects incl. roll-outs Upgrades Communication 47% 17

  18. Slide 18: Market size and outlook

    Market size and outlook Power Eltel markets  Investments by major grid owners expected to increase  Network modernisation and reliability BNEUR +3% together with transition to smart electricity meters important market drivers 7.2 7.9  Increased build out of renewable energy production drives sign

  19. Slide 19: Market size and outlook

    Market size and outlook Communication Stable markets  Strong growth in data traffic within both fixed and mobile communication  Stable markets with tough competition BNEUR +2% between telecom operator which puts some 4.4 4.6 price pressure on technical Infranet services  Telecom operators are exp

Eltel — Q1 2019 Earnings Presentation on 6ix