Sonova Holding Ag · SIX:SOON
Sonova — H1 2011/12 Earnings Presentation
34 slides from Sonova's earnings presentation, Nov 15, 2011
Slide 1: Half-Year 2011/12 Results – Investor & Analyst Conference
HALF-YEAR 2011/12 RESULTS – Investor & Analyst Conference Staefa, 15 November 2011
Slide 2: Disclaimer
Disclaimer This presentation may contain forward-looking statements including, but not limited to, projections of future performance of products, financial conditions, results of operations and cash flows. The statements are made on the basis of management’s views and assumptions regarding future ev
Slide 3: Business Review
BUSINESS REVIEW
Slide 4: Half Year 2011/12 Highlights
Half Year 2011/12 Highlights – Sales of CHF 763.0 million Total sales growth of +8.3% in lc Negative currency effect of 16.5% – Group EBITA of CHF 138.4 million or 18.1% of sales Negative currency effect of CHF 53.2 million – Solid core business hearing instruments Growth of 11.4% in lc Or
Slide 5: Key topics for 2011/12
Sonova Key topics for 2011/12 Topic Initiatives Status AB temporary recall Complete submission and receive FDA approval; resume selling in U.S.A. AB Neptune product launch Complete launch of new off-the-ear, water-proof power supply AB next generation product Continue development of next generatio
Slide 6: EUHA 2011 - Highlights
EUHA 2011 - Highlights - Solid local currency sales growth Preliminary H1 2011/12 sales results - Innovation leadership continues with Spice - Spice+, the next significant step forward More than ever the industry’s leading - Innovations in performance, miniaturization, brand water resistance, connec
Slide 7: Phonak: The best performing portfolio in the industry
Phonak The best performing portfolio in the industry – now on Spice+ CROS/ Power Standard CRT BiCROS Segment Premium Nano CIC WaterResistant Power Custom portfolio Advanced Audéo S Audéo S Audéo S Naída Naída Naída YES SMART MINI CROS S SP S UP S CRT Standard Accessories Phonak TVLink Phonak PilotOn
Slide 8: Phonak: Next generation Lyric
Phonak Next generation Lyric (in clinical trial phase) Next Generation Lyric will improve on following attributes: Fit Rate – Smaller in size – significantly improved fit rate Lyric current New new COGS – Industrialized by Sonova – Improved reliability – Improved COGS Lyric current New new Launch pl
Slide 9: Unitron: Enhanced product portfolio
Unitron Enhanced product portfolio Super Power Traditional CRT ITEs (custom) Sona: BTEs Segment Passport Passport Passport Premium Quantum Moxi Quantum Quantum micro 20, 12, 6 20, 12, 6 20, 12, 6 312 BTE vogue:ric Advanced vogue:micro 360 Latitude 4 Latitude 4 Latitude 4 vogue:intro Shine Shine Shin
Slide 10: Strongest product portfolio in the industry
Strongest product portfolio in the industry High innovation rate of 80% Launched 1 year ago 20% Launched 2 years ago Launched more than 2 years ago 58% 22% Phonak Ambra AudéoS Phonak Solana Phonak Cassia Phonak CROS/BiCROS Naida S Lyric Moxi Quantum Continuously outperforming the market November 15,
Slide 11: Sonova is the innovation leader
Sonova is the innovation leader Launch of new platforms drives organic growth in hearing instruments segment 4.0% 4.0% 23.8% 8.0% 8.0% 0.7% 3.4% 3.4% 18.8% 18.4% 18.4% 16.1% External growth in lc 1.1% 1.7% Internal growth in lc 11.1% 3.0% 4.4% 4.4% 3.0% 4.3% 4.3% 9.5% 9.5% 7.8% 7.8% 7.0% 5.8% 7.0% 5
Slide 12: Advanced Bionics: Back on the market worldwide
Advanced Bionics Back on the market worldwide On September 13th, 2011 the Advanced Bionics HiRes 90K cochlear implant was FDA approved for market re-entry. Therefore Advanced Bionics has resumed distribution in the United States and re-entered all markets worldwide. Hearing implants sales H1 2011/12
Slide 13: Sonova – The Hearing Care Company
Sonova – The Hearing Care Company Hearing instruments Behind-The-Ear hearing instruments (BTE) FM systems Hearing implants 95% of revenue 5% of revenue Cochlear implants Custom In-The-Ear hearing instruments (ITE) Hearing protection Wireless communication systems Earphones Invisible
Slide 14: Financial Track Record
Financial Track Record Sales in CHF million Gross profit margin in % of sales 1'617 75.00% 1'700 LC 1'500 69.9% 69.4% 70.6% 69.2% CAGR 68.2% 68.4% 1'500 70.00% 16.8% 66.6% 1'205 1'249 63.3% 1'300 65.00% 1'073 60.1% 1'100 867 60.00% 900 763 54.4% 621 660 55.00% 700 526 H1 500 50.00% 2002/03 2003/04 2
Slide 15: The business case for Sonova
The business case for Sonova Sonova serves an attractive market Sonova has strong leading positions in this market Significant opportunities for market share gains – Highest R&D spend – fast rate of product innovation – Multi-channel strategy – Multi-brand strategy Growth strategies – Innovation – M
Slide 16: Financial Review
FINANCIAL REVIEW
Slide 17: Financial Highlights
Half Year 2011/12 Financial Highlights – Solid financial results in local currencies on both Group level and in hearing instruments segment – Negative FX impact of CHF 136.8 million on sales and CHF 53.2 million on EBITA – Gross profit of CHF 522.1 million Gross profit margin of 68.4% Decrease o
Slide 18: Solid financial performance
Half Year 2011/12 Solid financial performance In CHF million H1 2011/12 Change H1 2010/111) Sales 763.0 -8.2% 831.5 Gross profit 522.1 -10.5% 583.4 Gross profit margin 68.4% 70.2% EBITA 138.4 -32.3% 204.4 EBITA margin 18.1% 24.6% Operating free cash flow 83.8 +2.2% 82.0 Cash-based basic EPS (in CHF)
Slide 19: Substantial FX impact on results
Half Year 2011/12 Substantial FX impact on results H1 2011/12 H1 2011/12 In CHF million (constant H1 2010/111) reported currencies) Sales 763.0 899.9 831.5 Gross Profit 522.1 623.3 583.4 Gross Profit margin 68.4% 69.3% 70.2% EBITA 138.4 191.6 204.4 EBITA margin 18.1% 21.3% 24.6% USD (average rate) 0
Slide 20: Sales results
Half Year 2011/12 Sales results Growth Internal External In CHF million H1 2011/12 H1 2010/111) FX impact in lc Growth Growth Hearing instrument sales 723.8 766.0 +11.4% +7.0% +4.4% -129.4 (-16.9%) Hearing implant sales 39.2 65.5 -28.8% -28.8% - -7.4 (-11.3%) Consolidated sales 763.0 831.5 +8.3% +4.
Slide 21: Solid growth in local currencies
Half Year 2011/12 Solid growth in local currencies in CHF million H1 2011/12 H1 2010/11 Sales in % Growth in lc Sales in % EMEA (excl. Switzerland) 289 38% 8.1% 303 36% Switzerland 21 3% 29.3% 16 2% USA 277 36% 9.6% 319 39% Americas (excl. USA) 102 13% 2.4% 117 14% Asia/Pacific 74 10% 7.2% 77 9% Tot
Slide 22: Sales growth across hearing instrument product groups
Half Year 2011/12 Sales growth across hearing instrument product groups in CHF million H1 2011/12 H1 2010/11 Sales in % Growth in lc Sales in % First class 173 23% 11.4% 189 23% Business class 174 23% 9.3% 189 23% Economy class 233 31% 13.5% 240 29% Wireless comm. 34 4% 0.2% 41 5% Miscellaneous 110
Slide 23: EBITA and EBITA margin development
Half Year 2011/12 EBITA and EBITA margin development (at constant currencies) EBITA and EBITA margin 250 30.0% 24.6% 21.3% 25.0% 200 17.3% 20.0% 150 15.0% in CHF million 100 in % of sales 10.0% 50 5.0% 0 0.0% H1 2010/11 H2 2010/111) H1 2011/121) 1) Based on constant currency rates from H1 2010/11, U
Slide 24: EBITA heavily impacted by FX
Half Year 2011/12 EBITA heavily impacted by FX EBITA development in CHF million +22 -30 +5 598 204 -10 191 -53 -13 138 -6.1% -66 -32.3% Margin: 21.3% Margin: Margin: 24.6% 18.1% EBITA Variance Increase of Acquisitions AB recall EBITA FX EBITA H1 2010/11 in gross OPEX H1 2011/12 effect H1 2011/12 pro
Slide 25: Operating expenses
Half Year 2011/12 Operating expenses Thereof Change in CHF million H1 2011/12 H1 2010/111) Change in CHF in lc acquisition related in lc Research & Development 58.6 59.6 -1.6% +3.6% +0.0% in % of sales 7.7% 7.2% Sales & Marketing 237.1 234.7 +1.0% +17.0% +9.4% in % of sales 31.1% 28.2% General & Adm
Slide 26: Cost management: OPEX development
Half Year 2011/12 Cost management: OPEX development (at constant currencies) Sales & Marketing OPEX General & Administration OPEX 33.2% 30.5% 12.5% 28.2% 10.1% 10.3% 30.5% 29.4% 27.4% 11.6% 9.8% 10.0% H1 2010/11 H2 2010/111) H1 2011/121) H1 2010/11 H2 2010/111) H1 2011/121) in CHF million in % of sa
Slide 27: Financial result and income taxes
Half Year 2011/12 Financial result and income taxes in CHF million H1 2011/12 H1 2010/111) Comments CHF 3.9m one-time costs EBITA 138.4 204.4 (PAI) Impairment of capitalized Amortization/Impairment -15.3 -10.1 R&D costs CHF 4.9m (PAI) Operating profit (EBIT) 123.1 194.2 Financial result, net -3.7 -6
Slide 28: Cash Flow: Improved working capital; reduced capital expenditures
Half Year 2011/12 Cash Flow: Improved working capital; reduced capital expenditures in CHF million H1 2011/12 H1 2010/111) Cash flow before changes in 169.7 250.5 net working capital Changes in net working capital -57.4 -99.1 Operating cash flow 112.3 151.4 in % of sales 14.7% 18.2% Cash flow from i
Slide 29: Balance Sheet: Sound financial position
Half Year 2011/12 Balance Sheet: Sound financial position in CHF million 30.9.2011 30.9.20101) Net working capital 172.8 202.4 Days sales outstanding (DSO) 79 74 Days inventory outstanding (DIO) 142 153 Operating capital employed 457.0 481.1 (excluding acquisition-related intangible assets) Capital
Slide 30: Outlook
OUTLOOK
Slide 31: Outlook: FX impact on sales and margins
Outlook FX impact on sales and margins likely to continue E 2011/12: 1.21 E 2011/12: 0.87 Rate Sales EBITA USD/CHF +/- 5% +/- CHF 30 million +/- CHF 10 million EUR/CHF +/- 5%impact on sales Negative +/- CHF 25 million expected on margins +/- CHF 15 million November 15, 2011 31
Slide 32: Original 2011/12 guidance is confirmed
Outlook Original 2011/12 guidance is confirmed Actual Original Guidance Confirmed Guidance in CHF million Year-to-September 2011/12 2011/12 2011 Sales 763 Sales growth in lc 8%-10% 8.3% 8%-10% incl. 2%-3% incl. 4.1% incl. approx. 3% acquisition growth acquisition growth acquisition growth EBITA 138
Slide 33: The business case for Sonova
The business case for Sonova Sonova serves an attractive market Sonova has strong leading positions in this market Significant opportunities for market share gains – Highest R&D spend – fast rate of product innovation – Multi-channel strategy – Multi-brand strategy Growth strategies – Innovation – M
Slide 34: Thank You
THANK YOU