Geberit Ag · SIX:GEBN
Geberit — H1 2004 Earnings Presentation
38 slides from Geberit's earnings presentation, Aug 5, 2004
Slide 1: Investor Presentation August 2004 (H1)
Investor Presentation August 2004 (H1) 08/05/04
Slide 2: Disclaimer
Disclaimer ! While Geberit is making great efforts to include accurate and up-to-date information, we make no representations or warranties, expressed or implied, as to the accuracy or completeness of the information provided in this handout and disclaim any liability for the use of it. ! The statem
Slide 3: Contents
Investor Presentation August 2004 (H1) Contents ! Key Elements ! Sales ! Financials ! Mapress Integration ! Strategy & Goals Investor Presentation August 2004 3
Slide 4: Key Elements
Key Elements Investor Presentation August 2004 4
Slide 5: Facts and Figures
Key Elements Facts and Figures ! Founded 1874, IPO 1999 ! European market leader in Sanitary Technology with global reach ! Sales 2003: CHF 1.75 bn * ! 25 sales companies with training centres ! 18 specialised production plants in Europe, USA, China ! 5’464 employees in 25 countries Jona plant CH, h
Slide 6: Know-How Installed
Key Elements The claim to describe Geberit as a whole - Know-How Installed ! Geberit Know-How creates state-of- the-art integrated sanitary systems ! Geberit solutions deliver unsurpassed reliability, flexibility and efficiency ! Extensive knowledge and expertise has been accumulated over many years
Slide 7: Integrated Sanitary Systems Solutions
Key Elements Integrated Sanitary Systems Solutions ! A system of compatible and Roof Drainage complementary products and services Flushing Prewall- ! Improved building procedures, Devices and Inwall noise insulation, hygiene, water Installation conservation, waste water hydraulics Shower ! Room for
Slide 8: Two Product Areas and seven Product Lines
Key Elements Two Product Areas and seven Product Lines (H1 2004: CHF 1,005 m ) Sanitary Systems CHF 541 m (54%) Piping Systems CHF 464 m (46%) Installation Building Systems Drainage MCHF 321 Systems 32% MCHF 173 Comprehensive 17% Flushing Product Portfolio Systems Water Supply MCHF 105 Systems 10% M
Slide 9: Sustained long-term Growth Pattern
Key Elements Sustained long-term Growth Pattern ! Sustained sales growth 1'800 CHF in millions incl. with modest cyclical impacts Mapress 1'600 ! High level results in 2003 Sales 1960-2003 1'400 ! Continued strong momentum 1'200 in H1 2004 1'000 ! Main growth drivers CAGRs: 1) - Innovative products
Slide 10: Consistent Delivery of high Level EBITDA-Margins
Key Elements Consistent Delivery of high Level EBITDA-Margins ! Operating profits on a premium level 25 in % (10 Y average: 23.2%) ! EBITDA growth during last decade 20 5.4%, above sales growth of 5.2% ! Substantial free cashflow generation 15 (CHF 206 m in 2003) 10 ! H1 2004 EBITDA grew faster than
Slide 11: Drivers for present strong Performance (1)
Key Elements Drivers for present strong Performance (1) ! The european building construction sector is gathering momentum ! Recovery of the German and the Swiss market ! Improved consumer sentiment with positive impact on RMI ! Geberit solutions gain market shares ! Good sales growth in USA in a fla
Slide 12: Drivers for present strong Performance (2)
Key Elements Drivers for present strong Performance (2) ! Intensive Marketing & Sales efforts 900 ! Strong brand identity 800 ! Installation Systems, Building Drainage Share Price 1999 - 2004 (CHF) and Water Supply are the main growth 700 drivers 600 ! Positive contribution by Mapress 500 ! Fast and
Slide 13: Positive Outlook for FY 2004
Key Elements Positive Outlook for FY 2004 ! Current business Dynamic first half year ! Markets Improved, but geopolitically unstable ! Sales growth 2004 Significant growth between 35 and 40 % ! Operating margins On current high level ! Net income Further improvement ! Financial position Solid, tempo
Slide 14: Sales
Sales Investor Presentation August 2004 14
Slide 15: H1 2004: Dynamic Growth of Group Sales
Sales H1 2004: Dynamic Growth of Group Sales CHF % YoY % YoY in millions Curr. adj. Organic 810.3 +15.3% +12.3% Total 1,004.8 +43.0% +40.0% Investor Presentation August 2004 15
Slide 16: H1 2004: Ongoing Sales Momentum
Sales H1 2004: Ongoing Sales Momentum % YoY H1 Q2 Q1 2003 Organic CHF +15.3% +13.4% +17.1% +6.2% Curr. Adj. +12.3% +12.5% +12.1% +4.8% Total CHF +43.0% +40.4% +45.6% +10.3% Curr. Adj. +40.0% +39.5% +40.5% +9.0% Investor Presentation August 2004 16
Slide 17: H1 2004: Dynamic Sales Growth in all Markets
Sales H1 2004: Dynamic Sales Growth in all Markets CHF in millions Sales Breakdown % YoY % YoY % YoY CHF/ org. Curr. adj./ org. Germany 347.9 34.6% +62.6% +18.8% +14.0% Italy 140.0 13.9% +26.7% +17.0% +12.2% Switzerland 104.9 10.4% +32.6% +12.3% +12.1% Austria 51.7 5.1% +26.1% +11.2% +6.6% United Ki
Slide 18: Key Market Remarks – Europe
Sales Key Market Remarks1) – Europe ! Double digit growth of +11.9%, mainly Main driven by Germany, Italy, Switzerland, European Markets France and Belgium ! Increasing market shares with installation systems, building drainage and water supply, controlled sales decline in underground piping systems
Slide 19: Key Market Remarks – North America and Asia/Pacific
Sales Key Market Remarks1) – North America and Asia/Pacific ! Encouraging development in the US, with strong growth for Geberit branded North America products, moderate increase for CFC products and a decline in pressure tanks ! Leveraging on larger salesforce, positive outlook for FY 2004 Asia/ ! A
Slide 20: H1 2004: Substantial growth in Key Product Lines
Sales H1 2004: Substantial growth in Key Product Lines CHF in millions Sales Breakdown % YoY % YoY % YoY CHF/ org. Curr. adj./ org. Installation Systems 320.7 31.9% +20.9% +20.9% +16.8% Flushing Systems 104.7 10.4% +10.6% +10.6% +7.5% Public 67.9 6.8% +6.4% +6.4% +10.3% Waste Fittings and Traps 47.2
Slide 21: Key Product Line Remarks - Sanitary Systems
Sales Key Product Line Remarks - Sanitary Systems Sales: MCHF 540.5 YoY in CHF: +16.2% in % of Total Sales: 53.8% YoY curr.adj.: +13.7% Installation Systems MCHF 320.7 - Double-digit growth in all markets except Austria - Ongoing internationalisation - Successful launch of Unica in Italy Flushing Sy
Slide 22: Key Product Line Remarks - Piping Systems
Sales Key Product Line Remarks - Piping Systems Sales: MCHF 464.3 YoY in CHF: +95.4% YoY org./CHF.: +13.5% in % of Total Sales: 46.2% YoY curr.adj.: +91.4% YoY org./c.a.: +9.5% Building Drainage Systems MCHF 172.8 - Strong organic growth in European Main Markets: + 14.3% - Extraordinary success with
Slide 23: Financials
Financials Investor Presentation August 2004 23
Slide 24: Q2 2004: Ongoing Dynamics
Financials Q2 2004: Ongoing Dynamics CHF in millions Q2 2004 Q2 2003 % YoY Sales 485.9 346.2 +40.4% EBITDA 117.8 81.1 +45.3% Margin 24.2% 23.4% EBIT 78.9 54.5 +44.8% Margin 16.2% 15.7% Net Income 50.3 33.9 +48.4% Margin 10.4% 9.8% EPS (CHF) 12.29 8.39 +46.5% Investor Presentation August 2004 24
Slide 25: H1 2004: Excellent Results
Financials H1 2004: Excellent Results CHF in millions H1 2004 H1 2003 % YoY Sales 1,004.8 702.7 +43.0% EBITDA 253.4 173.4 +46.1% Margin 25.2% 24.7% EBIT 181.8 120.3 +51.1% Margin 18.1% 17.1% Net Income 117.0 78.4 +49.2% Margin 11.6% 11.2% EPS (CHF) 28.58 19.37 +47.5% Investor Presentation August 200
Slide 26: H1 2004: Substantial Increase in Operating Profits
Financials H1 2004: Substantial Increase in Operating Profits CHF in millions H1 04 % H1 03 % % YoY Sales 1'004.8 100.0% 702.7 100.0% +43.0% Sales deductions 130.4 13.0% 93.1 13.2% +40.1% Net sales 874.4 87.0% 609.6 86.8% +43.4% Cost of materials 305.9 30.4% 1) 198.9 28.3% +53.8% Personnel expenses
Slide 27: H1 2004: Further EBIT-Margin Improvement
Financials H1 2004: Further EBIT-Margin Improvement Margin YoY + 3.0 % Volume effects + 0.5 % Price effects, net + 0.3 % Transaction gains - 0.3 % Higher R&D and other cost - 0.4 % Increased customer bonuses - 0.5 % Mapress: Ordinary business - 0.6 % Mapress: Goodwill and other amortisation - 1.0 %
Slide 28: H1 2004: Double digit Growth of Net Income
Financials H1 2004: Double digit Growth of Net Income CHF in millions H1 04 Margin H1 03 Margin % YoY Operating Profit (EBIT) 181.8 18.1% 120.3 17.1% +51.1% Financial income and (expense) -13.2 -1.3% -12.5 -1.8% +5.6% Profit before tax and minority interest 168.6 16.8% 107.8 15.3% +56.4% Income tax
Slide 29: H1 2004: Continuing strong Cash Flows
Financials H1 2004: Continuing strong Cash Flows CHF in millions H1 04 H1 03 FY 03 EBITDA 253.4 173.4 329.9 +/- Financial income and (expenses) -13.2 -12.5 -23.4 +/- Income tax expenses -50.9 -28.4 -34.1 +/- Other income and (expenses) -0.7 -1.0 -2.0 +/- Changes in long-term provisions +2.5 +0.1 -5.
Slide 30: H1 2004: Solid Balance Sheet
Financials H1 2004: Solid Balance Sheet CHF in millions 30.06.04 31.12.03 30.06.03 Cash and cash equivalents 95.4 181.3 147.1 Net working capital 239.0 1) 77.6 171.7 Property, plant and equipment 532.7 2) 490.9 499.0 3) Financial and other non-current assets 167.3 126.6 119.8 4) Goodwill and intangi
Slide 31: Mapress Integration
Mapress Integration Investor Presentation August 2004 31
Slide 32: Ahead of Schedule
Mapress Integration Ahead of Schedule ! Integration process of Mapress piping business full in line with objectives and ahead of schedule ! Alignment of production sites and R&D strategies within piping systems started immediately after the aquisition ! Integration of Marketing & Sales on track afte
Slide 33: Marketing & Sales Integration on track
Mapress Integration Marketing & Sales Integration on track ! Mapress Sales force integrated into Geberit Sales organisations in Germany, Austria, Italy, France and other markets ! Acquisition of the independent sales units in Norway, Finland and Great Britain and integration into the Geberit sales n
Slide 34: Strategy & Goals
Strategy & Goals Investor Presentation August 2004 34
Slide 35: The Geberit Credo
Strategy & Goals The Geberit Credo Excellence in Sanitary Technology. Worldwide. ! Geberit sets trends in sanitary technology. ! Our activities are based on a global approach. ! Geberit systems are recognised worldwide. Investor Presentation August 2004 35
Slide 36: Unchanged Strategy to increase Enterprise Value
Strategy & Goals Unchanged Strategy to increase Enterprise Value Intensify Market Invest in Optimise Business Development Innovation Processes Realise full potential of major Innovation rate Integrate Mapress and Blücher markets above 30% into Geberit processes Penetrate existing markets in Provide
Slide 37: Demanding mid-term Goals
Strategy & Goals Demanding mid-term Goals ! Sales CAGR 6-8% including add on acquisitions ! Share of sales outside major European markets: 25% (H1 2004: 19.6%) ! Operating margins on a premium level ! Overproportional EPS growth p.a. Investor Presentation August 2004 37
Slide 38: Success Factors to create future Value
Strategy & Goals Success Factors to create future Value ! Focus on core business ! Significant efforts in Marketing & Sales ! Creation of a strong brand identity ! Full R&D pipeline ! Successful product launches ! Intelligent acquisition policy ! Sustainable business management ! Cultivation of a mo