Kongsberg Gruppen ASA · OSL:KOG
Kongsberg Gruppen ASA — Q1 2004 Earnings Presentation
29 slides from Kongsberg Gruppen ASA's earnings presentation, Apr 29, 2004
Slide 1: Q1 2004 – World Class
Q1 2004 WORLD CLASS – through people, technology and dedication KONGSBERG April 29, 2004 1
Slide 2: Agenda
Agenda Key figures and highlights Kongsberg Maritime - Offshore & Merchant Marine - Yachting & Fishery Kongsberg Defence & Aerospace Profitability enhancement measures Prospects KONGSBERG April 29, 2004 2
Slide 3: Agenda
Agenda Key figures and highlights Kongsberg Maritime – Offshore & Merchant Marine – Yachting & Fishery Kongsberg Defence & Aerospace Profitability enhancement measures Prospects KONGSBERG April 29, 2004 3
Slide 4: KONGSBERG is not meeting market expectations – adjustments needed
Expectations KONGSBERG is not meeting market expectations – adjustments needed -Missiles -Keener competition -Longer delivery times to our customers KONGSBERG ‹date/time› © KONGSBERG 26 August 2003 4
Slide 5: Q1 highlights
Q1 highlights EBITA: MNOK 51 (MNOK 34) – Profits down MNOK 23 from Q1 2003 in the Missiles area – Drop in hydroacoustics activity; EBITA down MNOK 11 on the year – Smooth operations in other units EBT: MNOK 34 (- MNOK 8) – Sale of shares in Kitron ASA brought gain of MNOK 31 Extensive cost-cut
Slide 6: Key figures
Key figures (MNOK) Q1 2004 Q1 2003 2003 Operating revenue 1 526 1 639 6 651 EBITA 51 34 383 EBITA % 3.3 2.1 5.8 EBIT 28 11 291 EBT 34 (8) 190 Profit after tax 24 (6) 126 Profit per share 0.80 (0.20) 4.23 KONGSBERG ‹date/time› © KONGSBERG 26 August 2003 6
Slide 7: Operating revenues (accumulated)
Operating revenues (accumulated) Reduced volume in the defence segment (MNOK 94 in the Missiles area) 6 651 4 625 3 318 1 639 1 526 Q1 Q2 Q3 Q4 2003 2004 KONGSBERG ‹date/time› © KONGSBERG 26 August 2003 7
Slide 8: EBITA (accumulated)
EBITA (accumulated) EBITA margin: 3.3 % (2.1 %) Result influenced by a lack of new orders in missiles and hydroacoustics, combined with increased NSM development costs Projected EBITA for the year to approach the 2003 level 383 232 139 34 51 Q1 Q2 Q3 Q4 2003 2004 KONGSBERG ‹date/time› © KONGSB
Slide 9: New orders
New orders 3000 2500 2000 1500 1000 500 0 1Q02 2Q02 3Q02 4Q02 1Q03 2Q03 3Q03 4Q03 1Q04 Offshore & Merchant Marine Yachting & Fishery KDA Good influx of new orders in the maritime segments. KONGSBERG ‹date/time› © KONGSBERG 26 August 2003 9
Slide 10: Balance sheet
Balance sheet 31 March (MNOK) 31 Dec. 03 04 Assets 5 944 6 008 Net interest-bearing 1 262 1 159 debt Equity 1 857 1 830 Equity % 31.2 30.5 Debt/EBITDA 2.1 2.0 KONGSBERG ‹date/time› © KONGSBERG 26 August 2003 10
Slide 11: Agenda
Agenda Key figures and highlights Kongsberg Maritime Offshore & Merchant Marine Yachting & Fishery Kongsberg Defence & Aerospace Profitability enhancement measures Prospects KONGSBERG April 29, 2004 11
Slide 12: Kongsberg Maritime Highlights
Kongsberg Maritime Highlights Operating revenues comparable to 2003 Profit influenced by lower spending in the market for hydroacoustics products Good influx of new orders, up roughly MNOK 200 from last year. Backlog of orders up by MNOK 263 from year-end 2003 – High level of activity in Marin
Slide 13: Offshore & Merchant Marine EBITA (accumulated)
Offshore & Merchant Marine EBITA (accumulated) Operating revenues: MNOK 656 (MNOK 679) EBITA margin: 5.9 % (8.0 %) New orders: MNOK 912 (MNOK 730) Lower profitability in hydroacoustics 253 185 115 54 39 Q1 Q2 Q3 Q4 2003 2004 KONGSBERG ‹date/time› © KONGSBERG 26 August 2003 13
Slide 14: Offshore & Merchant Marine Market
Offshore & Merchant Marine Market Market for ships remains buoyant SHIPYARDS' ORDER BOOKS ORDERS FOR 2004 Number of ships Q1-2004 Trend 2000 China 54 -38,8 % 1500 South Korea 164 24,7 % Japan 63 -55,3 % 1000 Asia total 306 -19,8 % 500 Europe 103 26,8 % Rest of world 2 -72,4 % 0 SUM 411 -12,6 % 200
Slide 15: Offshore & Merchant Marine: Volume trend
Offshore & Merchant Marine: Volume trend 1000 900 800 700 600 500 400 300 200 100 0 Q1 02 Q2 02 Q3 02 Q4 02 Q1 03 Q2 03 Q3 03 Q4 03 Q1 04 New orders Operating revenues The market is active; KONGSBERG's influx of new orders has also picked up Offshore & Merchant Marine's backlog orders have longe
Slide 16: Yachting & Fishery EBITA (accumulated)
Yachting & Fishery EBITA (accumulated) Operating revenues: MNOK 244 (MNOK 216) EBITA margin: 4.1 % (4.2 %) The products are competitive, both technically and in terms of marketing. Higher volume in the yacht market, but rising pressure on prices is challenging profit margins. 44 Low investm
Slide 17: Agenda
Agenda Key figures and highlights Kongsberg Maritime - Offshore & Merchant Marine - Yachting & Fishery Kongsberg Defence & Aerospace Profitability enhancement measures Prospects KONGSBERG April 29, 2004 17
Slide 18: Defence & Aerospace Highlights
Defence & Aerospace Highlights NSM development – New firing tests to be performed in the summer/ autumn 2004 – Development scheduled for completion in 2005 – The prolongation of the development period will increase expenses NSM production – On 23 April 2004, the Cabinet asked for the Norwegian p
Slide 19: Defence & Aerospace Highlights
Defence & Aerospace Highlights Reduced volume in the Missiles area compared with 2003 – Volume down by MNOK 94 – EBITA down by MNOK 23 Downsizing on schedule – implemented in early half of year – Missiles & Space, approx. 70 man-years of labour – Land Systems & Communication, approx. 50 man-year
Slide 20: Defence & Aerospace EBITA (accumulated)
Defence & Aerospace EBITA (accumulated) Operating revenues: MNOK 627 (MNOK 728) EBITA margin: 0.5% (-4.0%) New orders: MNOK 320 (MNOK 1 446) 80 21 21 -29 3 Q1 Q2 Q3 Q4 2003 2004 KONGSBERG April 29, 2004 20
Slide 21: Agenda
Agenda Key figures and highlights Kongsberg Maritime - Offshore & Merchant Marine - Yachting & Fishery Kongsberg Defence & Aerospace Profitability enhancement measures Prospects KONGSBERG April 29, 2004 21
Slide 22: Profitability enhancement measures
Profitability enhancement measures KONGSBERG emphasises four areas for improving competitiveness and profitability – Strategic market position – Optimisation of operations – Value-based management – Innovation KONGSBERG ‹date/time› © KONGSBERG 26 August 2003 22
Slide 23: Strategic market position
Strategic market position "Closer to Customers” – In 2003, KONGSBERG expanded its international presence by opening operations at 9 new locations – Will continue to establish operations closer to the market in 2004 Product development – Continued focus on product development – Aggregate spending
Slide 24: Optimisation of operations: Profitability enhancement measures
Optimisation of operations: Profitability enhancement measures Segmemt Challenge Measure Goal Missiles & Lack of new orders Organisational adjustments Successful test Space Prolongation of development Preparatory new tests Cost cuts in effect in time for the NSM adds to costs Downsizin
Slide 25: Optimisation of operations: Reductions in Norway – expansion abroad
Optimisation of operations: Reductions in Norway – expansion abroad Downsizing – Implemented in 2003 - 168 – Initiated in Q1 2004 - 147 Total - 315 Acquired enterprises and venture creation (2003) +106 KONGSBERG to continue moving operations abroad Continued focus on synergies Further in
Slide 26: Safeguarding long-term profitability and growth
Safeguarding long-term profitability and growth Value-based management ”Our attitudes and behaviour are decisive for profitability” Innovation ”More innovation essential for future profitability” KONGSBERG ‹date/time› © KONGSBERG 26 August 2003 26
Slide 27: Agenda
Agenda Key figures and highlights Kongsberg Maritime Offshore & Merchant Marine Yachting & Fishery Kongsberg Defence & Aerospace Profitability enhancement measures Prospects KONGSBERG April 29, 2004 27
Slide 28: Prospects
Prospects The Board is aware that Missiles will continue to represent a risk in 2004 due to the order situation for Penguins and the NSM programme. Delays in testing the NSM are also increasing costs. The shipbuilding market is buoyant, and Offshore & Merchant Marine has a good influx of new ord
Slide 29: WORLD CLASS – through people, technology and dedication
WORLD CLASS – through people, technology and dedication KONGSBERG April 29, 2004 29