Slide 1: Full-Year Results 2018
Zurich | March 14, 2019 Full-Year Results 2018 Dr. René Lenggenhager, CEO Markus Portmann, CFO Technology with Passion Comet Group | FY Results 2018 | March 14, 2019 1
Slide 2: Full-Year Results 2018 agenda
Full-Year Results 2018 1 Status Update R. Lenggenhager 2 Review of FY 2018 Divisions R. Lenggenhager 3 Financial Results M. Portmann 4 Outlook R. Lenggenhager 5 Questions & Answers All Comet Group | FY Results 2018 | March 14, 2019 2 Technology with Passion
Slide 3: Status Update
Status Update Technology with Passion Comet Group | FY Results 2018 | March 14, 2019 3
Slide 4: Comet demonstrates resilience in managing cyclical downturn
Status Update Comet demonstrates resilience in managing cyclical downturn Sharp downturn in 3D NAND FY 2018 ! semiconductor market Corrective measures launched Solid net sales in CHF of and successfully completed 436.4m almost at prior-year level Adjustment of Underlying EBITDA margin of 11.1%* prod
Slide 5: Comet is facing a cyclical downturn in semiconductor equipment market
Status Update Comet is facing a cyclical downturn in semiconductor equipment market Underlying growth drivers for the future are intact Cycles in semi Data economy is growing Artificial intelligence mUSD $3,000 $2,500 $2,000 AI will accelerate the demand for $1,500 semiconductors Data and thus for $
Slide 6: Comet offers an innovative technology platform to enable key global trends
Status Update As a global technology leader, Comet offers an innovative technology platform to enable key global trends Industry 4.0 Data economy Security Artificial intelligence Inline processes Internet of things 3-D manufacturing ebeam Food safety CO2 footprint reduction Technology with Passion C
Slide 7: Review of 2018 Divisions
Review of 2018 Divisions Technology with Passion Comet Group | FY Results 2018 | March 14, 2019 7
Slide 8: PCT: Solid performance despite cyclical downturn of the semiconductor market in H2
Review of FY 2018 - Group and Divisions PCT: Solid performance despite cyclical downturn of the semiconductor market in H2 Net sales 213.0 212.2 Sales at previous year's level in local currencies 123.6 H2 28% down vs. record high H1 due to slowdown in demand for 3D NAND 107.2 memory chips and post
Slide 9: Status Update: PCT
Status Update: PCT Development of modular, flexible and highly precise generator on plan to address new market from 2020 onwards Future requirements in semi: Integrated RF systems from COMET will provide: Generator market size Advanced RF control systems Data-driven process analysis and optimiza
Slide 10: IXM: Pronounced margin improvement; expansion in non-destructive testing
Review of FY 2018 - Group and Divisions IXM: Pronounced margin improvement; expansion of position in core market of non-destructive testing Net sales 78.8 81.2 1.3% sales growth in local currencies due to Increasing sales of robust, portable Smart EVO X-ray solutions for pipeline 40.8 37.3 inspect
Slide 11: Status Update: IXM
Status Update: IXM Addressing market trends based on strong modular product portfolio and new developments Success based on 3 product segments Addressing customer needs and trends Based on continued mass customization, new products/upgrades and customer Portable x-ray projects planned for new applic
Slide 12: IXS: Product portfolio renewal taking effect; measures to improve earnings completed
Review of FY 2018 - Group and Divisions IXS: Product portfolio renewal taking effect; measures to improve earnings completed Net sales 139.8 135.7 4.7% sales decline in local currencies compared to previous year New and enhanced products already delivering results after a weak H1 73.0 65.0 Mainl
Slide 13: Portfolio renewal on track, focused pipeline for 2019
Status Update: IXS Portfolio renewal on track, first positive effects, focused pipeline for 2019 New products/ features in the pipeline for 2019 addressing needs in: Electronics Automotive FF 20/35 CT FF 85 CT Aerospace Cheetah / Cougar WI26G EVO 2017 2018 2019 2020 Technology with Passion Comet Gro
Slide 14: EBT: Realignment for more focus and lower cost base in 2019
Review of FY 2018 - Group and Divisions EBT: Realignment for more focus and lower cost base in 2019 Net sales 33% sales decline in local currencies Prior year's investments in product portfolio of large ebeam systems did not 29.5 meet expectations 14.8 20.0 Divestment of loss-making manufacturer
Slide 15: Progress with OEM modules and component business projects
Status Update: EBT Progress with OEM modules and component business projects Sterilization of liquid food packaging (Tetra Pak) Milestone 1.5 Bio Inactivation of dry food liquid food packages (Bühler) produced with ebeam Treatment of hatching eggs Technical launch LatuuTM available of LaatuTM to cus
Slide 16: Financial Results
Financial Results Technology with Passion Comet Group | FY Results 2018 | March 14, 2019 16
Slide 17: Net sales nearly matched the record 2017 level
Financial Results Net sales nearly matched the record 2017* level, Profitability impacted by one-time effects FY Change in CHF millions 2018 2017* Absolute In % Increased backlog, mainly at IXS New orders 436.5 442.0 -5.5 -1% Lower gross profit margin, influenced by Backlog 113.8 109.4 4.4 4% lo
Slide 18: Solid sales performance in a difficult environment
Financial Results Solid sales performance in a difficult environment -1.6% 500 443.4 +0.0 +1.0 -9.7 +5.4 +2.9* 436.4 450 -6.6 400 350 CHF millions 300 250 200 150 Volume effect in local currencies Positive 100 CHF -9.9m currency effect (-2.2%) (+0.6%) 50 - Net sales 2017 PCT IXS IXM EBT Elim. Curren
Slide 19: EBITDA margin before one-time costs at 11.1%
Financial Results EBITDA margin before one-time costs at 11.1% Reconciliation Dec YTD As IAS19 Before D @ local @ local FX @ nominal EBS IXS As @ nominal 2018 vs. PY reported IAS19 currencies currencies, impact FX rates, impact impact reported FX rates before EBS vs. PY before EBS vs. PY & IXS & IXS
Slide 20: Net income before one-time effects at CHF 24.3m
Financial Results Net income before one-time effects at CHF 24.3m -65% Operating income (EBIT) of 40 CHF 18.0m (PY CHF 35.3 -16.2 35 50.8m) impacted by one-time effects of CHF 30 16.6m CHF millions 25 -16.6 Net financing expenses 20 CHF 2.8m (PY CHF 0.9m) +11.6 12.3 15 10 Income tax expense -1
Slide 21: Limited foreign currency translation losses
Financial Results Limited foreign currency translation losses Net financing items amounted to an expense of CHF 2.8m (PY CHF 0.9m), reflecting the following factors: Interest expenses decreased to CHF 0.8m (PY CHF 1.3m) due to mortgage payback in 2017 & higher capitalization of bond interest relat
Slide 22: 2018 normalized tax rate at 24%
Financial Results 2018 normalized tax rate at 24% Reported effective tax rate of 18.9% includes 4.5 pps recognition and use of tax loss carry-forwards not recognized in prior years 0.6 pps other impacts as described below Actual income tax reported totaled CHF 2.9m (PY CHF 14.5m), comprising
Slide 23: Negative free cash flow driven by low profitability and significant investments
Financial Results Negative free cash flow driven by low profitability and significant investments CF provided by operating CF used in investing Free cash flow a) Cash as of Jan. 1, 2018 CF used & provided activities activities CHF -4.4m by financing activities b) Net income in 2018 CHF 22.5m CHF -26
Slide 24: Strong balance sheet ratios
Financial Results Strong balance sheet ratios In CHF millions 2018 2017 Current assets 206.1 56.0% 235.3 60.4% Non-current assets 161.7 44.0% 154.5 39.6% Total assets 367.8 100.0% 389.8 100.0% Liabilities 167.7 45.6% 188.2 48.3% Equity 200.0 54.4% 201.5 51.7% Total liabilities and equity 367.8 100.0
Slide 25: Initiatives identified to optimize working capital
Financial Results Initiatives identified to optimize working capital Working capital ratios Total net working capital* increased by CHF 3.1m, despite lower inventories, driven by a slow-down in business activities in H2 (leading to lower prepayments by customers and a lower trade payables balance)
Slide 26: Non-current assets influenced by EBS divestiture and capex in Flamatt
Financial Results Non-current assets influenced by EBS divestiture and capital expenditures for capacity expansion in Flamatt Non-current assets increased by CHF 7.2m or 4.7% Property, plant and equipment and intangible assets increased by CHF 7.7m Items that increased PPE and intangible assets:
Slide 27: Leverage ratio (net debt to EBITDA) at a low level of 0.7
Financial Results Leverage ratio (net debt to EBITDA) at a low level of 0.7 70 1.4 60 63.2 1.2 50 1.0 Ongoing investments and 40 47.7 0.8 39.8 37.8 0.7 a profitability reduction 30 35.7 0.6 lead to an expected 20 0.4 10 4.4 0.2 increase in leverage ratio 2.3 0 -0.1 0.0 to 0.7 0.1 0.1 -2.0 -10 -0.1
Slide 28: Distribution to shareholders of CHF 1.20 per share
Financial Results Distribution to shareholders of CHF 1.20 per share 1.6 90% 1.4 80% 1.2 70% 60% 1.0 in CHF 50% 0.8 40% 0.6 30% 0.4 20% 0.2 10% 0.0 0% 2014 2015 2016 2017 2018* Dividend Pay-out ratio in % * The Board of Directors proposes to distribute CHF 1.00 per share from distributable paid-in c
Slide 29: Outlook
Outlook Technology with Passion Comet Group | FY Results 2018 | March 14, 2019 29
Slide 30: Comet Group is entering 2019 on a sound basis
Outlook Comet Group is entering 2019 on a sound basis < < < < < < < < < Strong balance sheet Completion of Non-recurring Strong technology & corrective measures expenses (CHF 10.5m) platform; underlying low net debt at IXS and EBT – and non-recurring losses drivers of impact in 2019 from divested bu
Slide 31: Comet group is well positioned to address attractive market potential
Outlook Comet group is well positioned to address attractive market potential NDT PCT / IXM / IXS Addressable market Current market share EBT Core/ existing applications Future potential 31
Slide 32: Outlook 2019 in detail
Outlook Outlook 2019 in detail Expectations Underlying drivers intact; currently low visibility re exact timing of upturn in PCT semiconductor market, especially in relevant 3D NAND market segment; H1 2019 expected to be about 10% to 20% below H2 2018 Slightly higher revenues based on strong incomin
Slide 33: Longer-term strategy process at Group and divisions level
Strategy process We are working on the longer-term strategy both at the Group level and at divisions level, linking both closely COMET GROUP PCT IXS Finalize, align, clear with BoD IXM EBT Functional strategies Technology with Passion Comet Group | FY Results 2018 | March 14, 2019 33
Slide 34: Questions and answers
Questions and answers Technology with Passion Comet Group | FY Results 2018 | March 14, 2019 34
Slide 35: Annex
Annex Technology with Passion Comet Group | FY Results 2018 | March 14, 2019 35
Slide 36: Solid net sales; profitability impacted by one-time effects
Review of FY 2018 - Group and Business Segments Solid net sales, close to prior-year record numbers*; Profitability impacted by one-time effects Growth Net sales in CHF Decrease of 1.6% year-over-year from 443.4m to 436.4m Net income in CHF Decrease of 65.3% year-over-year from 35.3m to 12.3m Profit
Slide 37: Improved equity ratio and ongoing low net debt ratio
Review of FY 2018 - Group and Business Segments Improved equity ratio and ongoing low net debt ratio despite substantial investments Net debt in CHF balance sheet Increase in net debt vs. 2017, Quality of from 7.4m to 24.8m Equity ratio Up 2.7% pps vs. 2017 from 51.7% to 54.4% Economic profit * Earn
Slide 38: Net USD exposure of CHF 98m in 2018
Financial Results Net USD exposure of CHF 98m in 2018; EUR slightly negatively hedged USD exposure in % of sales 100% down to 22.4% (PY 28.2%), 4.1% driven by slowdown of business 80% activities 35.0% Net USD 57.3% +/-0.01 CHF/USD impacts on a exposure of CHF 98m full-year basis: net sales +/- 6
Slide 39: Overview of organization
Outlook Overview of organization CEO R. Lenggenhager CIO CFO E. Dubuis M. Portmann CHRO Communication P. Hafner I. Najorka Plasma Control ebeam X-Ray Systems X-Ray Modules Technologies Technologies M. Kammerer T. Wenzel S. Haferl R. Lenggenhager (interim) Technology with Passion Comet Group | FY Res
Slide 40: Financial calendar for the Comet Group
Financial calendar for the Comet Group April 25, 2019 Annual shareholder meeting in Berne August 15, 2019 Publication of H1 2019 results November 21, 2019 Investor Day More details on our business performance and financial results: Markus Portmann Ines Najorka http://www.comet-group.com Chief Financ
Slide 41: Disclaimer
Disclaimer This document contains forward-looking statements about the Comet Group that may be subject to uncertainty and risk. Readers should therefore be aware that such statements may deviate from actual future outcomes or events. Forward-looking statements in this document are projections of pos
Slide 42: Thank you for your interest
Thank you for your interest Technology with Passion Comet Group | FY Results 2018 | March 14, 2019 42