Slide 1: NORMA Group SE Full Year Results 2016
NORMA Group SE Full Year Results 2016 Maintal, March 22, 2017
Slide 2: Highlights 2016
Successful acquisition of the global quick connector business from Autoline with locations in France, M&A China and Mexico Successful acquisition of Lifial, Portugal, who has been manufacturing metal clamps for 28 years for M&A use in industry and agriculture Continuing cross selling of Distribution
Slide 3: Financial highlights 2016: sales, EBITA, EPS
Sales Sales of EUR 894.9 million (2015: EUR 889.6 million) leads to growth of 0.6% Adjusted EBITA Adjusted EBITA of EUR 157.5 million (2015: EUR 156.3 million) Margin Adjusted EBITA margin stable at 17.6% (2015: 17.6%); 7th year of sustainable margin higher than 17.0% Adjusted Improved adjusted tax
Slide 4: Balance sheet, cash flow and dividend highlights
Strong balance sheet with an equity ratio of 36.2% (2015: 36.8%) despite dividend payment and higher Equity balance sheet total due to the Autoline acquisition Net debt* increased moderately to EUR 392.0 million (2015: EUR 357.5 million) despite the Autoline Net Debt* acquisition and dividend paymen
Slide 5: Regional sales development
EMEA: Solid growth in EJT includes favorable automotive business while DS sales were slightly negative – this led in total to a growth of +3.8% including negative currency effects and start of consolidation of Autoline. Americas: Strong decline in EJT sales due to downturn of commercial vehicle,
Slide 6: Organic growth slowed during the year
Organic growth slowed down during the year mainly due to lower than expected US commercial vehicles, agricultural and construction machinery sector including aftermarket Autoline has been consolidated since December 2016 and contributed 0.4% of growth in 2016 Only minor currency changes in 201
Slide 7: Historic Revenue Development 1997 to 2016
Historic Revenue Development in EUR million 890 895 695 636 605 581 490 458 385 330 277 229 242 182 198 207 150 174 121 138 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 1997 to 2016: 20 years of a successful growth story Page 7
Slide 8: Adjusted EBITA and margin by quarter
FY 2010: FY 2011: FY 2012: FY 2013: FY 2014: FY 2015: FY 2016: 17.4% 17.7% 17.4% 17.7% 17.5% 17.6% 17.6% EUR million 21.1% 21.0% 21.3% 20.5% 20.5% 20.4% 20.4% 20.6% 20.8% 20.6% 20.8% 20.4% 19.9% 19.7% 19.7% 20.2% 20.1% 20.4%20.4% 20.0% 19.6% 19.2% 19.6% 50 19.1% 18.9% 19.0% 19.2% 18.9% 18.9% 20% 18.
Slide 9: Acquisition of Lifial, Portugal
M&A Acquisition of Lifial – Indústria Metalúrgica de Águeda, Lda. (‘Lifial’), Portugal, in January 2017 Business Manufacturer of metal clamps for the use in industry and agriculture (distribution business) Model Based in Águeda, Portugal For more than 28 years the company has been manufacturing heav
Slide 10: Acquisition of Autoline business
M&A Acquisition of all assets of the Autoline business from Parker Hannifin in November 2016 Business Global supplier of quick connectors for all types of automotive fluid line applications Model Based in Guichen, France, with production sites in France, Mexico and China For more than 20 years the c
Slide 11: Sales Consolidation Effects from acquisitions
Date of Total Sales Consolidation Effects in EUR million Acquisition Sales CONNECTORS Verbindungstechnik AG, Switzerland 04/12 Market entry in connecting technology in Pharma & Biotech 16.6 Nordic Metalblok S.r.l., Italy 07/12 Market consolidation heating and air conditioning clamps 5.2 Chien Jin Pl
Slide 12: Sales split by business and end market
thereof water management thereof industrial supplier 19% (19%) 29% (26%) DS 40% (39%) EJT 60% (61%) 21% thereof general distribution thereof (20%) products 5% commercial vehicle OEM (8%) 26% (27%) thereof passenger vehicle OEM * FY 2016 (2015 in brackets) Page 12
Slide 13: Material costs, personnel expenses, other OPEX, adjusted EBITA
Favorable material costs in combination with improvements from the Global Excellence Program led to a better material cost ratio Higher personnel expenses ratio mainly due to weak commercial vehicle, agricultural and construction machinery business in the US and investments into Asia-Pacific S
Slide 14: Operational adjustments after the Autoline acquisition
Operational adjustments after the Autoline acquisition in 2016 EUR 4.8 million costs related to Autoline in 2016 Further operational adjustments planned in 2017 for Autoline and for ongoing PPA adjustments in EUR million 2010 2011 2012 2013 2014 2015 2016 Reported EBITA 64.9 84.7 105.2 112.1 1
Slide 15: Operational adjustments on EBITDA level
Operational adjustments on EBITDA level due to the acquisition of Autoline EUR 0.58 adjustments on EPS level in EUR million Reported Adjustments Adjusted Sales 894.9 894.9 4.8 EBITDA 174.6 (incl. EUR 1.7 million transfer taxes; EUR 2.1 million acquisition costs; 179.4 EUR 0.4 million integration
Slide 16: Adjustments FY 2016 to FY 2018
in EUR million FY 2016 FY 2017* FY 2018* ca. 4 EBITDA level 4.8 (integration costs and inventory-step-ups for 0 Autoline) EBITA level 7.1 ca. 8 ca. 2 (incl. EUR 2.3 million depreciation PPA) (incl. ca. EUR 4 million depreciation PPA) (depreciation PPA) EBIT level 27.7 ca. 29 ca. 23 (incl. EUR 20.6 m
Slide 17: Dividend proposal EUR 0.95 per share
Dividend proposal to the shareholders at the AGM on May 23, 2017: EUR 0.95 per share (2016: EUR 0.90) Pay-out of EUR 30.3 million for 31,862,400 shares (32.0% of adjusted Group net profit of EUR 94.6 million) General policy: dividend of 30% to 35% of adjusted Group net profit Adjusted EPS Repo
Slide 18: Income statement adjusted and reported
in EUR million Adjusted Reported 2015 2016 2015 2016 Sales 889.6 894.9 889.6 894.9 Gross profit 533.1 545.6 530.6 544.9 EBITDA 177.5 179.4 173.9 174.6 in % of sales 20.0 20.0 19.5 19.5 EBITA 156.3 157.5 150.5 150.4 in % of sales 17.6 17.6 16.9 16.8 EBIT 147.9 147.7 124.8 120.0 in % of sales 16.6 16.
Slide 19: Trade working capital ratio improved to 16.1%
Trade working capital ratio further improved to 16.1% of sales Improvement to 15.5% achieved including pro forma sales of Autoline On pro forma sales: trade receivables and trade payables improved, inventories showed slight increase EUR million 18.5% 20% 18.1% 18.3% 18.1%* 400 17.4% 17.1% 16.1
Slide 20: Equity increased by EUR 54 million
Equity increased by EUR 54 million with strong profit of EUR 76 million Equity ratio slightly decreased due to higher balance sheet total from the Autoline acquisition and dividend payment EUR million 600 36.8% 36.2% 500 7* -29 76 400 300 484 200 430 100 0 Equity 2015 Profit Dividend Others* Equ
Slide 21: Net Debt, leverage and gearing
Net Debt* (in EUR million) 358 392 600 Leverage** Dec 31, 2015 Dec 31, 2016 400 (Net debt* / adjusted LTM EBITDA) 2.0 x 2.1 x 458 558 200 0 Gearing Dec 31, 2015 Dec 31, 2016 -100 -166 (Net debt* / equity) 0.8 x 0.8 x -200 Dec 31, 2015 Dec 31, 2016 Cash Debt * excl. derivative financial liabilities o
Slide 22: Maturity Profile
Maturity Profile (in EUR million) – Financial Instruments Promissory Note 3 Promissory Note 2 67 Promissory Note 1 Bank Borrowings 36 113 78* 43 5 35 5 26 5 5 29 45 42 21 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 Maturity Profile (in EUR million) – Currencies USD EUR 117 90 12 4 4 24 64 52 1
Slide 23: Balance sheet Dec 31, 2016
in EUR million Dec 31, 2015 Dec 31, 2016 in EUR million Dec 31, 2015 Dec 31, 2016 Assets Equity and liabilities Non-current assets Equity Goodwill / Other intangible assets / Total equity 429.8 483.6 784.8 865.5 Property, plant & equipment Non-current and current Other non-financial assets / liabili
Slide 24: Net Operating Cash Flow
Net Operating Cash Flow in EUR million 2011 2012 2013 2014 2015 2016 Variance Adjusted EBITDA 117.0 120.8 129.3 138.4 177.5 179.4 +1.1% Δ ± Working capital -19.5 -9.8 +5.1 +10.4 -0.6 +17.0 n/a Net operating cash flow before investments from operating 97.5 111.0 134.4 148.8 176.9 196.4 +11.1% busines
Slide 25: Strategic priorities 2017
1 Continue international expansion 2 Continue to explore business opportunities in APAC to expand regional business and further improve profitability 3 Further ramp up of second China plant to enable further expansion into domestic and APAC markets 4 Expanding water business in the US as well as con
Slide 26: Economic and market growth expectations
in % 2016 2017e 2018e World +3.1 +3.4 +3.6 USA +1.6 +2.3 +2.5 China +6.7 +6.5 +6.0 Euro zone +1.7 +1.6 +1.6 Germany +1.9 +1.7 +2.0 VDMA (German Engineering Federation) expects worldwide machine sales to grow by 2% in 2017 Euroconstruct expects solid growth path of +2.1% for the European construc
Slide 27: Guidance 2017
Sales Moderate organic growth of around 1% to 3%, additionally around EUR 45 million from acquisitions Adjusted EBITA Sustainable at the same level as in previous years of more than 17.0% margin Adjusted Material Cost Roughly at the same level as in previous years ratio Adjusted Personnel Cost Rough
Slide 28: Mid-term targets: R&D, CAPEX, cash flow, dividend
Investments in Approx. 5% of EJT sales R&D Innovations 20 new invention applications p.a. Quality Proportion of defective parts in production to be below the value of 20 parts per million CAPEX Operative investments of around 5% of Group sales rate Net Operating Around EUR 130 million Cash Flow Divi
Slide 29: Investment highlights
1 Market leader in attractive engineering niche markets with long term growth prospects 2 Enhanced stability through broad diversification across products, end markets and regions Engineered products with premium pricing through technology and innovation leadership 3 in mission-critical components S
Slide 30: Appendix
Appendix Page 30
Slide 31: NORMA Group products and customer requirements
NORMA Group products Specific customer requirements driven by megatrends NORMACLAMP® 34% of sales Continuous new developments on a global level in order to Emission fulfil fleet consumption regulations and cope with increased reduction awareness in public perception Weight Ongoing trend in many indu
Slide 32: Tightening emission regulations globally
Today Europe Euro 3 Euro 4 Euro 5 Euro 6 NAFTA EPA ‘00 EPA ‘04 EPA ‘07 EPA ‘10 Post Tier 3 (phase-in) Brazil Euro 1 Euro 2 Euro 3 Euro 4 Euro 5 Russia Euro 1 Euro 2 Euro 3 Euro 4 Euro 5 India Euro 1 Euro 2 Euro 3 Euro 4 Euro 6 China Euro 1 Euro 2 Euro 3 Euro 4 Euro 5 Euro 6 2000 2002 2004 2006 2008
Slide 33: EU CO2 fleet average limits
EU legislation required CO2 fleet average limits 2007 2015 2020 2021 158.7 g/km 130 g/km 95 g/km ~ 6.8 l/100km* ~ 5.6 l/100km* ~ 4.1 l/100km* [95%] [100%] Reduction from Reduction of 27% during 6 years 2007 to 2015 (5.1% p.a.) only 18% in 8 triggers high efforts in emission reduction across years (2
Slide 34: Global Comparison of Fuel Economy
Global Comparison of Fuel Economy Region Target Target Duration Fleet Fleet Change CAGR year year in years Goal year 1 Goal year 2 1 2 under under converted** converted** national laws national laws EU 2015 2021 6 130 g/km 130 g/km 95 g/km 95 g/km -27% -5.1% USA 2016 2025 9 37.8 mpg 139 g/km 56.2 mp
Slide 35: Clear global market leader in Clamp / Connect
Clear global market leader in Clamp / Connect Excellent growth outlook across EJT market Sales in EUR million (year) Additional growth for 1000 Joining Technology market 895 above market growth 800 ca. Fluid Passenger vehicles add. 2- 4% 42% 600 Commercial vehicles add. 2- 4% ca. 58% Clamp (ca. 34%)
Slide 36: Mission-criticality: small relative costs, high impact
Mission-criticality: Small relative costs – high impact Basis for premium pricing Market leadership Technology Quality Innovation Tailor-made solutions ca. EUR 66 in the exhaust system ca. EUR 95 in other ca. EUR 30 application in the exhaust ca. EUR 6 areas system in other ca. EUR 10 application ar
Slide 37: Key end markets
Examples of NORMA Group’s key end markets Construction / infrastructure Engines Commercial vehicles Passenger vehicles Construction equipment / water management Wholesalers & technical Agricultural equipment Shipbuilding White goods Pharma & Biotech distributors More than 35,000 products, manufact
Slide 38: Unique business model with two ways-to-market
Unique business model with two distinct ways-to-market Significant economies of scale in production Resident engineers with close contact to international EJT customers No. 1 national and international DS service level and DS product portfolio Engineered Joining Technology (EJT) Distribution S
Slide 39: A world without NORMA Group
A world without NORMA Group Customer impact Reputation loss Image loss Warranty costs Non-compliance with legal requirements/regulations Loss of end-customers Page 39
Slide 40: Company history and milestones
Acquisition 2017 Lifial, Portugal Acquisition 2016 Autoline Business, France Foundation Acquisition Acquisition National 2014 NORMA China II 2011 Five Star, USA Diversified Sales, USA Acquisition Acquisition Variant, Acquisition Guyco, Foundation MDAX listing 2013 Davydick & Co, Australia Poland Aus
Slide 41: Global footprint: production sites and countries
EMEA Czech Republic (P) - Hustopece France (P, D) – Briey, Guichen Germany (P, D) – Maintal, Gerbershausen, Marsberg Italy (D) Netherlands (D) Poland (P, D) - Pilica Portugal (P) - Agueda Russia (P, D) - Togliatti Serbia (P) - Subotica Spain (D) Sweden (P, D) - Anderstorp Switzerland (P, D) - Tagels
Slide 42: Revenue, gross profit, personnel expenses, adjusted EBITA
Revenue (in EUR million) Gross Profit (in EUR million) 1000 600 58.4% 58.4% 59.9% 61.0% 54.9% 55.3% 56.0% 55.5% 57.0% 60% of sales 890 895 533 546 750 400 695 406 40% 500 605 636 371 581 323 344 458 490 275 200 251 20% 250 330 182 0 0 0% 2008 2009 2010 2011 2012 2013 2014 2015 2016 2008 2009 2010 20
Slide 43: Net operating cash flow, working capital, CAPEX
Net Operating Cash Flow (in EUR million) Trade Working Capital (in EUR million) 18.5% 18.3% 18.1% 18.3% 18.5% 17.4% 18.1%* 17.1% 20% of sales 16.1% 400 150 15.5%* 200 108 123 124 81 79 90 10% 49 70 125 54 46 45 65 67 74 80 115 130 140 0 -46 -41 -38 -59 -81 -101 -120 -19 -30 100 -200 0% 2008 2009 201
Slide 44: Milestones and free float changes
Milestones and Free float Changes Identified Institutional Shareholders* Apr 2011 IPO with ca. 36% free float 18% 24% Jun 2011 SDAX listing 6% 21% 17% Since 100% free float 14% Jan 2013 Mar 2013 MDAX listing Germany United Kingdom USA Nordic France Rest of World Free Float per March 9, 2017 includes
Slide 45: Financial calendar and contact
Event Date Publication Interim Results Q1 2017 May 10, 2017 Annual General Meeting in Frankfurt / Main May 23, 2017 Publication Interim Results Q2 2016 August 9, 2017 Publication Interim Results Q3 2016 November 8, 2017 Contact Andreas Troesch Vice President Investor Relations Phone: +49 6181 6102-7
Slide 46: Disclaimer on future-oriented statements
This presentation contains certain future-oriented statements. Future-oriented statements include all statements which do not relate to historical facts and events and contain future-oriented expressions such as ‘believe,’ ‘estimate,’ ‘assume,’ ‘expect,’ ‘forecast,’ ‘intend,’ ‘could’ or ‘should’ or