COLTENE Holding AG · SIX:CLTN
COLTENE — FY2018 Earnings Presentation
40 slides from COLTENE's earnings presentation, Apr 4, 2019
Slide 1: The New COLTENE
The New COLTENE Full Year Results 2018 COLTENE Group – Media and Financial Analysts Conference Martin Schaufelberger, CEO Gerhard Mahrle, CFO 4 April 2019, Zurich
Slide 2: Safe Harbour Statement
Safe Harbour Statement The information made available in this presentation may include forward-looking statements that reflect intentions, beliefs or current expectations and projections of the COLTENE Group about future results of operations, financial conditions, liquidity, performance and similar
Slide 3: Agenda
Agenda Media and financial analysts conference FY 2018 Highlights 2018 Martin Schaufelberger, CEO Financials 2018 Gerhard Mahrle, CFO The New COLTENE Group Martin Schaufelberger, CEO Outlook Martin Schaufelberger, CEO Full Year Results 2018 04.04.2019 3
Slide 4: Highlights 2018
Highlights 2018 Martin Schaufelberger, CEO Photo: Max Cui Production Service Technician / SciCan Ltd. Toronto, Canada
Slide 5: Company Portrait
Company Portrait COLTENE – at a glance Listed at SIX stock exchange in Zurich, Switzerland 6 legal Market Cap manufacturing approx. sites 4 global sales entities supported by over 300 CHF 580 mn sales reps sell via distributors to dentists COLTENE develops, manufactures and markets premium dental Me
Slide 6: FY 2018 Highlights
FY 2018 Highlights Entering into a new era for the Company Financials M&A Sales CHF 204.0 mn +21.4% Proposal to pay dividend of Quantum leap thanks to the Net Sales of the COLTENE compared to 2017 – hereof CHF 3.00 per share from acquisitions of Kenda, SciCan Group incl. Kenda, Micro-Mega M&A +18.1%
Slide 7: FY 2018 Highlights
FY 2018 Highlights Entering into a new era for the Company Operational Products Commissioning of new office Organic growth of 2.7% clearly Introduction of the new R&D focus on digital and manufacturing building at outperforming the stagnating product group structure dental treatment methods the head
Slide 8: New Product Group Structure
New Product Group Structure What COLTENE stands for Infection Control Dental Preservation Efficient Treatment „The infection „Sustainable preservation „Smart & efficient control specialist“ from root to crown“ utilities dentists rely on“ Instrument reprocessing Materials for restoration Impression m
Slide 9: Net Sales by Region
Net Sales by Region Significant growth in North America and Europe Net sales 2018 by regions (shares) Net sales 2018 by regions (in CHF 1,000) 90’000 85’291 80’000 75’905 70’145 12.8% 70’000 2017 2018 60’000 58’104 8.2% 41.8% 50’000 40’000 26’079 30’000 37.2% 22’232 17’509 20’000 16’677 10’000 0 EME
Slide 10: Net Sales by Region
Net Sales by Region Share by region of the new COLTENE based on adding sales of COLTENE+Micro-Mega+SciCan for 2018 13.0% 7.0% 35.0% EMEA North America Latin America Asia/Oceania 45.0% Full Year Results 2018 04.04.2019 9
Slide 11: Net Sales by Product Groups
Net Sales by Product Groups New product groups established, Efficient Treatment leads sales Net sales 2018 by product groups (shares) Net sales 2018 by product groups (in CHF 1,000) 120’000.00 2017 2018 101’629 100’000.00 14.2% 75’977 80’871 80’000.00 73’276 49.9% 60’000.00 35.9% 40’000.00 29’047 20
Slide 12: Net Sales by Product Groups
Net Sales by Product Groups Share by product group for the new COLTENE based on adding sales of COLTENE+Micro-Mega+SciCan for 2018 30.0% Infection Control 40.0% Dental Preservation Efficient Treatment 30.0% Full Year Results 2018 04.04.2019 9
Slide 13: Financials 2018
Financials 2018 Gerhard Mahrle, CFO Photo: Eric Ozelski Product Manager North America / SciCan Inc. Pittsburgh, USA
Slide 14: Financial Summary 2018
Financial Summary 2018 Strong top-line, impacted bottom line by one-time extraordinary effects Sales EBIT Net Profit New record sales of CHF 204.0 mn, EBIT of CHF 23.7 mn (2017: CHF 25.5 Net profit amounted to CHF 14.9 mn up 21.4% mn), impacted by non-operational, one- (2017: CHF 19.1 mn) time extra
Slide 15: Financial Summary 2018
Financial Summary 2018 Strong top-line, impacted bottom line by one-time extraordinary effects Tax Rate Cash Flow Balance Sheet Tax rate of 30.4% (2017: 22.2%) Cash flow from operations of Net debt position of CHF 29.2 mn CHF 24.6 mn (2017: CHF 21.9 mn) (2017: net cash position of 13.8 mn) Tax provi
Slide 16: Income Statement
Income Statement Non-recurring effects from first-time consolidation of acquisitions decreased operating results in CHF mn 2018 % 2017 % % YoY Income statement reflects acquisitions Net Sales 204.0 100.0 168.0 100.0 +21.4 Net sales increased by +21.4% Material expenses* -61.6 -30.2 -46.3 -27.6 +33.0
Slide 17: Income Statement
Income Statement EBIT margin stood at 15% after factoring out non-operational and non-recurring effects from first-time consolidation of acquisitions 2018 Step-up Transaction Amortization 2018 in CHF mn % Tax Effect % 2018 % 2017 as reported Inventory cost Intangibles adjusted Net Sales 204.0 100.0
Slide 18: Income Statement
Income Statement Non-operational and non-recurring effects from first-time consolidation of acquisitions 2018 Step-up Transaction Amortization 2018 in CHF mn % Tax Effect as reported Inventory cost Intangibles adjusted Net Sales 204.0 100.0 204.0 Inventory step up (finished goods valued Material exp
Slide 19: Balance Sheet: Total Assets
Balance Sheet: Total Assets Significant increase of intangible assets due to recent acquisitions – no impairment in CHF million 31.12.18 31.12.17 % YoY Balance sheet total increased through acquisitions Cash & cash equivalents 20.9 22.0 -5.0 Receivables 64.4 40.5 +59.0 Inventory 55.6 31.6 +75.9 Good
Slide 20: Balance Sheet: Total Liabilities and Equity
Balance Sheet: Total Liabilities and Equity Solid financial basis thanks to capital increases in CHF million 31.12.18 31.12.17 % YoY Two major capital increases Cash & cash equivalents 20.9 22.0 -5.0 Receivables 64.4 40.5 +59.0 Inventory 55.6 31.6 +75.9 Net debt stood at CHF 29.2 mn due to acquisiti
Slide 21: Cash Flow Statement
Cash Flow Statement High investments in current and future growth in CHF m 2018 2017 % YoY Higher cash flow from operations Net profit 14.9 19.1 -22.0 Net investments of CHF 115.4 mn Depreciation and amortization 7.2 5.7 +26.3 Other non cash items 6.0 4.6 +30.4 Cash flow from operating activities in
Slide 22: Share Performance
Share Performance Positive perception of acquisitions, drop in Q4 in line with market-wide drawbacks Share price Earnings per share/dividend 130 5.00 4.52 120 4.1 110 4.00 3.71 100 3.16 3.16 90 3 3 3.00 2.7 80 2.5 70 2.2 60 2.00 50 40 1.00 04.01.2016 04.03.2016 04.05.2016 04.07.2016 04.09.2016 04.11
Slide 23: Change in Accounting Standard in FY 2019
Change in Accounting Standard in FY 2019 COLTENE will change its accounting standard from IFRS to Swiss GAAP FER On February 14, 2019, the Board of Directors of COLTENE Holding AG Change will take decided to adopt Swiss GAAP FER as the Company’s accounting and Provisional impact on income reporting
Slide 24: AGM 2019
AGM 2019 Proposals to the general assembly Re-election of the Distribution Compensation of the Group Auditor current members of the Board of Directors and Board of Directors Group Management Nick Huber, Erwin Locher, Board of Directors proposes Maximum aggregated Re-election of EY Jürgen Rauch, Matt
Slide 25: The New COLTENE Group
The New COLTENE Group Martin Schaufelberger, CEO Photo: Jasmin Gaby QM / Regulatory Affairs Office / Coltène/Whaledent AG Altstaetten, Switzerland
Slide 26: Truly Global Setup
Truly Global Setup Own sales force across North and Latin America, Europe, Asia including India and China North America Group companies 4 Production sites 2 Workforce (FTE) 610 35% Latin America CHF 90 m 45% Group companies 1 CHF 120 m Production sites 1 Workforce (FTE) 120 Europe EMEA 13% Group com
Slide 27: Operations
Operations State-of-the-art production facilities in the US, Canada, Brazil, Germany, France and Switzerland Canada, Toronto Switzerland, Altstaetten Germany, Langenau USA, Cuyahoga Falls (OH) Brazil, Rio de Janeiro France, Besançon Full Year Results 2018 04.04.2019 27
Slide 28: Comprehensive Product Portfolio
Comprehensive Product Portfolio Update dentistry – Better Quality, Better Reliability, Better Practice Infection Control Dental Preservation Efficient Treatment Instrument reprocessing and Restoration Endodontics Impression Rotary Treatment surface disinfection materials instruments utilities ParaCo
Slide 29: Business Model
Business Model Product Management Production Warehouse Sales Channel Customers CW AG – chemical production COLTENE sales reps Associations Altstaetten CH EMEA MicroMega – endodontic files Europe Besançon F Local Distributors Langenau GER CW KG – PP/GP/auxiliaries Asia Sales push Sales pull Langenau
Slide 30: Strategic Approach
Strategic Approach Leverage synergies and cross sales potential Understand the Materialize the expected Establish the base for customers’ needs synergies from the merger operational excellence with SciCan and Micro-Mega Focus on innovation Push short-term merger projects Review group processes Visib
Slide 31: Key Topics on the Agenda
Key Topics on the Agenda Commitment to profitable sustainable growth Define and implement short term merger projects Strategy review process and implementation of strategy mandates Review product road map and focus on key innovation projects Improve quality systems and regulatory affairs – t
Slide 32: Organization
Organization Management Board of Directors Group Management Matthew Robin Allison Zwingenberger Astrid Waser Werner Barth, VP Marketing Stefan Helsing, COO Jürgen Rauch Roland Weiger Martin Schaufelberger, CEO Werner Mannschedel, VP Q&RA Nick Huber, Chairman Erwin Locher Gerhard Mahrle, CFO Christop
Slide 33: Outlook
Outlook Martin Schaufelberger, CEO Photo: Gaelle Batista Technical Support Logistics / Micro-Mega SA Besançon, France
Slide 34: Dental Industry
Dental Industry Mega trends Globalization and e-commerce Increasing requirements in distribution regarding quality management and regulatory affairs Negative trend in volume due to Digitalization in better oral health in Consolidation • the dental processes developed countries in manufacturing • our
Slide 35: Milestones 2019 and Outlook
Milestones 2019 and Outlook Continued growth and profitability gains We expect a global organic COLTENE expects to The merger will After additional cost due to the growth of our market segment grow slightly more support growth by transaction & integration projects, in the area of 1.0-2.0 % in 2019 t
Slide 36: Summary
Summary Consumables in dental industry have limited, but robust growth expectations The recent merger rises sales Sound financial situation from CHF ~ 170 to ~ 280 mn and allowing to post merger with net debt of COLTENE benefit from economy of scale effects in CHF ~ 30 mn is Upgrade Dentistry • incr
Slide 37: The New COLTENE: Q&A
The New COLTENE: Q&A COLTENE
Slide 38: Thank You for Your Interest
The New COLTENE Thank You for Your Interest COLTENE Holding AG Martin Schaufelberger, CEO Gerhard Mahrle, CFO Feldwiesenstrasse 20 9450 Altstaetten +41 71 757 53 80 info@coltene.com
Slide 39: Annexe
Annexe COLTENE
Slide 40: Key Figures
Key Figures Five year overview Net Sales in CHF million in CHF million EBIT EBIT Margin in % 210.0 204.0 32.0 15.2% 15.0% 16.0% 200.0 30.0 14.5% 190.0 28.0 13.8% 26.0 13.2% 14.0% 180.0 168.0 24.0 170.0 162.3 160.7 22.0 11.6% 160.0 154.5 12.0% 20.0 150.0 18.0 22.4 20.4 23.3 25.5 23.7 30.7 140.0 16.0