Econocom Group Se Class D · EURONEXT:ECONB
Econocom Group Se Class D — H1 2020 Earnings Presentation
45 slides from Econocom Group Se Class D's earnings presentation, Sep 10, 2020
Slide 1: 2020 Half-Year Results Analyst Presentation
2020 half-year results ANALYST PRESENTATION September 10th, 2020 1
Slide 2: Today's speakers
Today’s speakers JEAN-LOUIS Angel Laurent BOUCHARD BENGUIGUI ROUDIL Chairman & CEO Managing Director Managing Director Econocom - 2020 Half Year Results 2
Slide 3: Our agenda
01 One digital company OUR AGENDA 02 H1 2020 results and financial position 03 2021 outlook
Slide 4: Digital general contractor
One digital company, a new claim to express our identity and singularity Digital general contractor 4
Slide 5: 2018-20: 3 years of consolidation
2018-20: 3 years of consolidation Appointments as Group Appointment of Appointment Managing Directors of ECS Osiatis Starting period of new L. Roudil as GM as CFO of A. Benguigui Acquisition Acquisition management team for Services A. Benguigui & L. Roudil (2010) (2013) (end 2016 / early 2017) (earl
Slide 6: One digital company
One digital Committed Strengthened Supportive company teams fundamentals market trends Econocom - 2020 Half Year Results 6
Slide 7: One digital company
01 One digital company
Slide 8: Digital general contractor
Digital general contractor Equipment | Services | Financing 8
Slide 9: Digital general contractor
Digital general contractor Clients Econocom Econocom needs offering expertise User experience Advisory Solutions EQUIPMENT Synergies between Installation Integration people & digital SERVICES Managed Services Cloud Funding agility FINANCING Applications Recycling End-to-end support ability for the i
Slide 10: Our success factors in digital transformation
Our success factors in digital transformation Wide range of technologies & Multi-industry Long-term European expertise partnerships presence services Others Education 17% 22% Energy 10% Manufacturing 18% IT 15% Services 18% Econocom - 2020 Half Year Results 10
Slide 11: The team
The team at the center of the organization Very experienced Unfailing support Management Team provided to our clients throughout Covid-19 crisis New talents to Entrepreneurial mindset drive sustainable growth Econocom - 2020 Half Year Results 11
Slide 12: Case Study #1: large outsourcing project for a global high-tech leader
Case Study #1: large outsourcing project for a global high-tech leader Goal Key figures Full outsourcing of the Workplace support chain €52 M project Governance End-to-end project support 44,000 users Innovation 5 year User experience improvement contract Econocom - 2020 Half Year Results 12
Slide 13: Case Study #2: digital transformation of points of sales of a car manufacturer
Case Study #2: digital transformation of points of sales of a leading car manufacturer Goal Key figures Transforming and digitalizing dealerships across Europe €30 M project Team All countries involved 15,000 with central coordination equipment delivered and installed Innovation 16 Installation and
Slide 14: H1 2020 results and financial position
02 H1 2020 results and financial position
Slide 15: Key highlights
Key highlights Revenue ROP Net Result Net financial debt €1.24 Bn €43.5 M €22.1 M €303 M -12.5% (1) +12.4% (1) (2) 4x (1) -€102 M (3) vs. H1 2019 vs. H1 2019 vs. H1 2019 vs. H1 2019 (1) On a like-for-like basis (2) Before amortization of intangible assets from acquisitions (3) Excluding impact of IF
Slide 16: Continued increase in profitability despite Covid-19 impact
Continued increase in profitability despite Covid-19 impact H1 2020 revenue impacted Revenue(1) by Covid-19 pandemic H1 2020 €1,240 M - 12.5% ROP up by €4.8 M (+12.4%) H1 2019 €1,417 M vs. H1 2019 Positive effects of cost savings measures started early 2019 and intensified in H1 2020 Recurring opera
Slide 17: Strong foothold and scale in Europe
Strong foothold and scale in Europe H1 2020 Revenue (% and €) North America North & East Europe 6% (€68 M) 8% (€102 M) France South Europe All regions similarly impacted 53% (€659 M) by the Covid-19 pandemic 18% (€228 M) Total €1,240 M Benelux 15% (€182 M) Econocom - 2020 Half Year Results 17
Slide 18: Accelerating on cost savings plan
Accelerating on cost savings plan Cumulated net annual cost savings Clear acceleration of cost savings plan over H1 2020 2021 Net Global Objective(1) €90 M Well on track with €90 M objective of net savings by 2021 Structural cost savings H1 2020 Period to date Realized excluding ad hoc cost €73 M in
Slide 19: Services / Products & Solutions: strong increase in profitability
Services / Products & Solutions (DSS): Strong increase in profitability Revenue(1) Similar decline in revenue between Services (-12.4%) Services Products & Solutions and Products & Solutions (-11.7%) H1 2020 €280 M €481 M €761 M - 11.9% Sharp increase in Services H1 2019 €320 M €544 M €864 M profita
Slide 20: Technology Management & Financing: Revenue and ROP hit by Covid-19
Technology Management & Financing: Revenue and ROP hit by Covid-19 crisis Financing activities generated Revenue(1) €479 M in revenue down 13.5% - year-on-year H1 2020 €479 M 13.5% H1 2019 €553 M Decrease more significant in Q1 (-16.2%) than in Q2 (-11.7%) with new operations gradually introduced ag
Slide 21: Stability of TMF portfolio
Stability of TMF portfolio Contract portfolio €6.1 Bn Overall stability of portfolio at original purchasing price Residual interest(1) • 2.9% of the Original €2.9 Bn Purchase Price • >2x covered by remarketing of assets and contract extensions €0.18 Bn (1) Outstandings Original Residual interest pur
Slide 22: Overall increase in ROP and Net profit
Overall increase in ROP and Net profit (In €M) H1 2020 H1 2019(1) Increased in ROP Revenue 1,240 1,424 despite decline in revenue Recurring operating profit2 43.5 41.2 Recurring operating profit 42.5 40.2 Increase in non- recurring expenses Non-recurring operating incomes and expenses -23.7 -13.5 fo
Slide 23: H1 2020 FCF generation in line with H1 2019
H1 2020 FCF generation in line with H1 2019 Free Cash flow over H1 2020 +50 -19 -44 -88 -20 -5 -127 Free cash flow generation in line with H1 2019 level Operating Non TMF WCR Financial CAPEX Free cash flow Cash flow recurring Investments Expenses items & Income tax • FCF structurally negative over H
Slide 24: Solid Free Cash Flow 12 months as of end of H1 2020
Solid Free Cash Flow 12 months as of end of H1 2020 €78 M of FCF FCF 12 months H1 2020= +€78 M generation over last 12 months contributing to -405 -303 deleveraging • €140 M of cash flow +110 -51 from operating +140 -29 -30 +52 -39 -35 activities -16 • €52 M WCR outflow slightly improved NFD(1) Oper
Slide 25: Strong progress on deleveraging path
Strong progress on deleveraging path Net Financial Debt (NFD)(1) Leverage ratio – NFD to LTM EBITDA NFD reaching €303 M down €102 M vs. H1 2019 • Benefits from the sale of EBC in H1 2020 €405 M Sharp decrease -€102 M in leverage ratio €303 M 2.5x at H1 2020 • 1.8x 12 LTM EBITDA 1.8x vs. 2.5x in H1 2
Slide 26: Solid liquidity position
Solid liquidity position Liquidity overview – H1 2020 Bond repayment schedule – H1 2020 Ample liquidity of ca. € 375 M including €375 M planned actions to accelerate deleveraging €200 M ca.53 m€M €150 No need for state- backed loans €224 M €137 M €53 M Actions Next bond maturity to come in November
Slide 27: Financial objectives 2020
Financial objectives 2020 2020 Revenue 2020 ROP Implement growth of slightly better actions towards -6% or better or equal to 2019 zero net debt ROP(1) (1) On a like-for-like basis Econocom - 2020 Half Year Results 27
Slide 28: 2021 outlook
oo 2021 — outlook
Slide 29: A new era for growth
A new era for growth One digital Committed Strengthened Supportive company teams fundamentals market trends Econocom - 2020 Half Year Results 29
Slide 30: Products & Solutions
Products & Solutions At the center of evolving customer needs Today 2021 key metrics focus Revenue 2019 €1.1 Bn Grow in Germany, Italy, Benelux and Spain People ca. 600 Strengthen positions in France #2 in France, challenger positions in rest of Europe Econocom - 2020 Half Year Results 30
Slide 31: Focus: acquisition of Switch B2B assets in Belgium
Focus: acquisition of Switch B2B assets in Belgium Key highlights 1st Apple Premium Reseller in Belgium €25 M revenue in 2019 Strengthen Econocom leadership as an Apple Authorized Enterprise Reseller (“AAER”) Group dynamics New Apple certification to develop in Education premium services and support
Slide 32: Services
Services Focus on higher value-adding offerings Today 2021 key metrics focus Revenue 2019 €0.7 Bn Mutualize outsourcing model between France, Belgium People and Spain ca. 7,800 Synergies with satellites Top 10 France Econocom - 2020 Half Year Results 32
Slide 33: Services in France
Services in France Strong increase in results and profitability over the last 3 years ROP Margin improvement improvement x 2.5 x 2.5 vs. 2017 from 2.5% to 6.5% vs. 2017 Econocom - 2020 Half Year Results 33
Slide 34: Technology Management & Financing
Technology Management & Financing A growing market in the next years Today 2021 key metrics focus Revenue 2019 Recruit €1.1 Bn new salespeople People ca. 650 Growth actions all over Europe Leading position in France Target scale and foothold external developments in major European in Germany countri
Slide 35: Solid and experienced TMF Management team
Solid and experienced TMF Management team Samira Draoua Chantal De Vrieze Frances Weston Paris Brussels London Emiliano Veronesi Carlos Perez-Herce Christoph Bläser Milano Madrid Frankfurt Econocom - 2020 Half Year Results 35
Slide 36: Financial objectives 2021
Financial objectives 2021 2021 Revenue Implementation of growth between new 3-year strategic +5% and +10% plan to be presented in February 2021 Econocom - 2020 Half Year Results 36
Slide 37: Q&A
Q&A E c o n o c o m - 2 0 2 0 H 37 a l f Y e a r R e s u l t s
Slide 38: Appendices
Appendices E c o n o c o m - 2 0 2 0 H 38 a l f Y e a r R e s u l t s
Slide 39: Stock Exchange
Stock Exchange Equity table Number of shares: • 220,880,430 Treasury Stocks 1.5% Share price as of September 8th, 2020: • 2.4€ Holding companies held by Mr. Bouchard Listing place: 40.6% Free float • Euronext Brussels 57.9% Market Cap • EBR: ECONB €530 M • ISIN: BE0974313455 Stock Indexes: • Bel Mid
Slide 40: Divisional breakdown overview
Divisional breakdown overview Revenue(1) Equipment Services Financing 2019 €1,131 M €671 M €1,124 M €2,927 M 2018 €1,026 M €652 M €1,249 M €2,927 M Recurring operating profit (ROP)(1)(2) Equipment Services Financing 2019 €46.9 M €35.4 M €43.9 M €126.2 M 2018 €38.7 M €19.9 M €52.3 M €110.9 M (1) On a
Slide 41: H1 2020 Revenue and ROP bridges
H1 2020 Revenue and ROP bridges In €M 192 1,424 -8 1 1,417 1,238 -6 1,240 Revenue H1 2019 IFRS 5 IFRS 15 H1 2019 Rayonnance Exchange H1 2019 H1 2020 Published impact impact Restated disposal Rates Like-for-Like 1.2 41.4 -2.6 43.5 40.2 - -0.1 38.7 ROP H1 2019 IFRS 5 IFRS 15 H1 2019 Rayonnance Exchang
Slide 42: Simplified consolidated balance sheet
Simplified consolidated balance sheet ASSETS (IN €M) 30/06/2020 31/12/2019(1) EQUITY & LIABILITIES (IN €M) 30/06/2020 31/12/2019(1) Goodwill 509 513 Equity 498 484 Other non-current assets 219 234 Net Financial Debt 303 252 Assets related to leasing activities 459 404 Commitments on residual value 1
Slide 43: Net Financial Debt overview
Net Financial Debt(1) overview In €M Bonds 478 -307 NFD at €303 M at H1 2020 • of which €282 M Net related to own booked -191 cash TMF contracts Short term -41 maturing within debt 30 months -55 -303 Cash -150 -39 OCEANE on hand Euro PP -78 Schuldschein Others NFD (1) NFD: Net Financial Debt excludi
Slide 44: Contacts
Contacts Contact relations investisseurs Contact et relations actionnaires : agence : etienne.jacquet@econocom.com Contact agence: info@capvalue.fr Tel. +33 1 80 81 50 00 Contact relations presse : anne-marie.cravero@econocom.com Econocom - 2020 Half Year Results 44
Slide 45: Thank you
Thank you E c o n o c o m - 2 0 2 0 H 45 a l f Y e a r R e s u l t s