Slide 1: Media and Financial Analysts Conference
Zurich, March 9, 2020 Media and Financial Analysts Conference Belimo Holding AG
Slide 2: Agenda
Agenda 1. Welcoming Remarks Patrick Burkhalter, Chairman of the Board of Directors 2. Financial Year 2019, Markets and Strategy Lars van der Haegen, CEO 3. Financial Results 2019 Dr. Markus Schürch, CFO 4. Deep Dive: Impact Investing Dr. Adrian Staufer, Head Strategy & Brand Management 5. Outlook 20
Slide 3: Agenda
Agenda 1. Welcoming Remarks, Changes in the Board of Directors Patrick Burkhalter, Chairman of the Board of Directors 2. Financial Year 2019, Markets and Strategy Lars van der Haegen, CEO 3. Financial Results 2019 Dr. Markus Schürch, CFO 4. Deep Dive: Impact Investing Dr. Adrian Staufer, Head Strate
Slide 4: Welcoming Remarks: Review of my First Year as Chairman
Welcoming Remarks Review of my First Year as Chairman of the Board Ensuring continuity. Sustainability as a key target. Growth strategy confirmed and renewed. Direct contact to anchor shareholder. Long-term succession planning: Nomination of new Member to the Board of Directors. Media and
Slide 5: Changes to the Board of Directors
Welcoming Remarks Changes to the Board of Directors Stefan Ranstrand (born 1960, Swiss and Swedish) since 2009: President and CEO at TOMRA Systems ASA (Asker) Norway. 1991-2009: Various Executive Positions at ABB Ltd., in Switzerland, Japan, Malaysia, China and the Czech Republic. 1981-1985: M
Slide 6: Agenda
Agenda 1. Welcoming Remarks, Changes in the Board of Directors Patrick Burkhalter, Chairman of the Board of Directors 2. Financial Year 2019, Sales and Markets Lars van der Haegen, CEO 3. Financial Results 2019 Dr. Markus Schürch, CFO 4. Deep Dive: Impact Investing Dr. Adrian Staufer, Head Strategy
Slide 7: Financial Year 2019: Profitable Growth with Impact
Financial Year 2019 Profitable Growth with Impact Sustainability Strong Sales Closer to the Growth Customer Integrated Sustainability Outstanding sales Expansion of footprint with Report according to GRI. performance and above- new service and logistics Recognized as a sustainable average growth
Slide 8: Financial Year 2019: Attractive Market Environment
Financial Year 2019 Attractive Market Environment Positive overall market conditions. Robust non-residential construction markets. Sustained inflow of investments, private and public. Ongoing trend toward stricter energy-efficiency regulations. Media and Financial Analysts Conference, March
Slide 9: Belimo Products in Every Third Non-Residential Building
Financial Year 2019 Belimo Products in Every Third Non-Residential Building Government Hotels Data Centers Buildings Commercial Universities / Airports Hospitals Buildings Schools Media and Financial Analysts Conference, March 9, 2020 9
Slide 10: Financial Year 2019: Robust Growth
Financial Year 2019 Robust Growth Robust growth: net sales grew 2019 by 7.8% Net Sales and EBIT margin EBIT margin 17.9% to CHF 692.7 million. in CHF million EBIT margin 17.1% EBIT margin EBIT margin 16.0% Currency-adjusted, this corresponds to a EBIT margin 16.3% 15.1% strong growth of 9.2%.
Slide 11: Sales and Markets 2019: Water Performing Particularly Well
Sales and Markets 2019 Water Performing Particularly Well Nettoumsatz Net nach Marktregion Sales by Application in CHF million Millionen Net Sales in million +9.2% +7.8% 701.2 692.7 642.4 Strong growth in all three Belimo market regions. 2018 2019 2019 Ongoing expansion of business in Water-Appl
Slide 12: Europe: Solid Growth in 2019
Sales and Markets 2019 Europe: Solid Growth in 2019 Solid sales growth of 6.8% when adjusted for Net Sales currencies (3.6% growth in CHF). in million +6.8% +3.6% Net Sales by Country in CHF million Germany 338.8 328.8 69.8 317.2 Others 141.3 Net Sales 328.8 Middle and East Europe 51.2 2018 2019 201
Slide 13: Americas: Looking Back at an Excellent Year
Sales and Markets 2019 Americas: Looking Back at an Excellent Year Excellent sales growth of 11.0% in local currencies Net Sales (in CHF 12.3%). in million +12.3% +11.0% Net Sales by Country in CHF million Others 10.1 Canada 46.9 269.7 272.8 242.9 Net Sales 272.8 USA 2018 2019 2019 215.8 CHF LC* CHF
Slide 14: Asia Pacific: Growth in Line with Strategy
Sales and Markets 2019 Asia Pacific: Growth in Line with Strategy Excellent sales growth of 12.7% in local currencies Net Sales (respectively 10.7% in CHF). China’s contribution with in million a growth of 19.5% was repeatedly outstanding. Net Sales by Country in CHF million +12.7% +10.7% Others Net
Slide 15: Expanding our Footprint Across Regions
Sales and Markets 2019 Expanding our Footprint Across Regions Ramp-up of new service and logistics center in Großröhrsdorf near Dresden (Germany). Adding capacity in the field of sensors and meeting individual customer needs. Scheduled to become fully operational in 2020. Media and Financial A
Slide 16: Expanding our Footprint Across Regions
Sales and Markets 2019 Expanding our Footprint Across Regions Belimo is expanding its operations in India by building a new facility in Mumbai (India). It will be housing customization, sales and a customer experience center for training purposes. Media and Financial Analysts Conference, March 9
Slide 17: Celebrating the Shipping of 100 Millionth Actuator
Sales and Markets 2019 Celebrating the Shipping of 100 Millionth Actuator The number of actuators shipped increased to Products Shipped 7.2 million pieces (+6.2%). in million items The number of valves shipped increased to 1.6 million pieces (+13.0%). In January 2020, Belimo celebrated 100 mil
Slide 18: Media and Financial Analysts Conference, March 9, 2020
Media and Financial Analysts Conference, March 9, 2020 18
Slide 19: Agenda
Agenda 1. Welcoming Remarks, Changes in the Board of Directors Patrick Burkhalter, Chairman of the Board of Directors 2. Financial Year 2019, Sales and Markets Lars van der Haegen, CEO 3. Financial Results 2019 Dr. Markus Schürch, CFO 4. Deep Dive: Impact Investing Dr. Adrian Staufer, Head Strategy
Slide 20: Strong EBIT as well as EBIT Margin
Financial Results 2019 Strong EBIT as well as EBIT Margin EBIT in CHF million Operating income (EBIT) increased by 12.8% to Margin CHF 123.9 million, or 17.9% of sales. 17.9% Margin 17.1% Lower material expenses, 40.3% of net sales Margin Margin 16.0% (PY 41.4%), margin expansion. 16.3% Margin 1
Slide 21: Continuing to Welcome New Colleagues
Financial Results 2019 Continuing to Welcome New Colleagues Personnel Expenses Personnel expenses increase, continued in CHF million investment of CHF 188.3 million * in % of net sales 27.2%* (PY CHF 171.2 million, +10.0%). 26.7%* 27.4%* 27.2%* Sales per employee increased to TCHF 405 28.3%* (PY
Slide 22: Stable Other Operating Expenses
Financial Results 2019 Stable Other Operating Expenses Other Operating Expenses in CHF million Stable other operating expenses (operating * in % of net sales 11.1%* 10.4%* expenses excl. personnel expenses), increased by 11.6%* 1.3% to CHF 72.2 million. 10.9%* 10.8%* Impact of IFRS 16 leases in
Slide 23: Pressing Ahead with Our Growth Strategy
Financial Results 2019 Pressing Ahead with Our Growth Strategy R&D Costs in CHF million Investments in future portfolio in accordance with * in % of net sales our growth strategy; stable investments in 7.3%* 7.4%* research and development (in % of sales). 7.7%* 7.1%* 7.0%* 50.7 47.2 44.4 37.7 34.7 2
Slide 24: Nonrecurring Tax Effect with no Impact on Cash Flow
Financial Results 2019 Nonrecurring Tax Effect with no Impact on Cash Flow Net Income in CHF million Net income grew by 40.5%, including a positive Margin non-recurring effect of CHF 22.1 million from the 17.5% Swiss tax reform and AHV financing (TRAF). Margin 13.4% Effective tax rate -1.1% (PY
Slide 25: Impacts of the Swiss Tax Reform (TRAF)
Financial Results 2019 Impacts of the Swiss Tax Reform (TRAF) The Swiss federal law on the tax reform and AHV financing (TRAF) entered into force on January 1, 2020. Abolishment of beneficial tax regulations along with introduction of transitional (step-up mechanism or dual rate approach) as wel
Slide 26: Impacts of the Swiss Tax Reform
Financial Results 2019 Impacts of the Swiss Tax Reform Estimated ETR* Recognition of the tax advantage from 25% transitional measures in 2019 impacting estimated ETR estimated ETR income taxes positively by CHF 22.1 million 20% 14.1% - 14.6% 17.8% 16.8% - 17.3% without affecting cash flow. 15% O
Slide 27: Generating a Strong Operating Cash Flow
Financial Results 2019 Generating a Strong Operating Cash Flow Cash Flow in CHF million Strong operating cash flow (+10.1%) 125.4 Increase of investments in property, plant 113.9 and equipment, machinery and tools. 94.3 90.3 82.3 83.9 Lower free cash flow due to higher 75.2 70.4 investments: -
Slide 28: Second Half-Year Impacted by Seasonality
Financial Results 2019 Second Half-Year Impacted by Seasonality 2. half-year in CHF million 1. half-year proforma Total Stronger first half year due to lower and shortened month of December. Net sales 355.2 337.5 692.7 Material expenses -142.9 -136.0 -278.9 in percent of net sales -40.2% -40.3% -40.
Slide 29: Sound Balance Sheet Structure
Financial Results 2019 Sound Balance Sheet Structure Increased non-current assets: 12.31.2018 in CHF million restated 12.31.2019 Implementation of IFRS 16 (CHF 15.6 million) and investments in property, Cash and cash equivalents 155.1 172.6 plant and equipment. Other current assets 193.1 202.3 Non
Slide 30: Retaining a Strong Set of Key Figures
Financial Results 2019 Retaining a Strong Set of Key Figures 2015 2016 2017 2018 2019 Net sales growth in local currencies 3.6% 6.8% 8.2% 9.6% 9.2% EBIT margin 15.1% 16.3% 16.0% 17.1% 17.9% Free cash flow in % of net sales 7.5% 14.1% 9.5% 14.7% 12.1% Return on invested capital (ROIC) 20.8% 23.8% 23.
Slide 31: Delivering Results on the Stock Market
Financial Results 2019 Delivering Results on the Stock Market 2015 2016 2017 2018 2019 Earnings per share, in CHF 91.52 113.51 126.06 140.22 197.00 Stock market price as at December 31, in CHF 2 450 3 078 4 266 3 940 7 290 Dividend, in CHF 65 75 85 100 150 * Payout ratio 71.1% 66.1% 67.5% 71.3% 76.1
Slide 32: Dividend Policy: Optimum Cash Reserves
Dividend Policy Optimum Cash Reserves To reduce its substantial cash reserves, the Company will increase payout ratio. The Board of Directors therefore proposes a dividend of CHF 150.00 per share at the 2020 Annual General Meeting. Increase pay out ratio in the foreseeable future to attain app
Slide 33: Main Contributions to Seven Sustainable Development Goals
Sustainability @ Belimo Main Contributions to Seven Sustainable Development Goals Media and Financial Analysts Conference, March 9, 2020 33
Slide 34: Identification of Material Topics
Sustainability @ Belimo Identification of 16 Material Topics Economic Performance – Profitable Growth with Impact High Company Values and Culture – Empowerment and Engagement Stakeholder Relevance Medium Customer Engagement and Support High Performance Solutions – Energy Savings in the Field
Slide 35: Report Structured Along Five Key Themes
Sustainability @ Belimo Report Structured Along Five Key Themes Performance Credibility Culture Customer Value Solution Leadership Operational Excellence 35
Slide 36: Agenda
Agenda 1. Welcoming Remarks, Changes in the Board of Directors Patrick Burkhalter, Chairman of the Board of Directors 2. Financial Year 2019, Sales and Markets Lars van der Haegen, CEO 3. Financial Results 2019 Dr. Markus Schürch, CFO 4. Deep Dive: Impact Investing Dr. Adrian Staufer, Head Strategy
Slide 37: Media and Financial Analysts Conference, March 9, 2020
Media and Financial Analysts Conference, March 9, 2020 37
Slide 38: The Energy Demand of Buildings
Impact Investing The Energy Demand of Buildings 40% 40% of worldwide of the energy energy used in consumption buildings is can be used for HVAC attributed to buildings ~ 2-3% Existing Buildings new buildings per year Media and Financial Analysts Conference, March 9, 2020 38
Slide 39: Reducing the CO2 Impact of Buildings
Impact Investing Reducing the CO2 Impact of Buildings What pays off the most? Building Automation? Lighting? Windows? Ventilation? Envelope? Cooling? Heating? Media and Financial Analysts Conference, March 9, 2020 39
Slide 40: Cost of Energy-Efficiency Measures in Existing Buildings
Impact Investing Cost of Energy-Efficiency Measures in Existing Buildings (CH)* Typical Energy Consumption (MJ/m2/a) Net Annual Cost of Energy Improvement Measures [MJ/m2/a] 0 100 200 300 400 500 600 -10 0 [CHF/m2/a] +10 typical ranges Heating F Cooling E not explicitly mentioned E Ventilation
Slide 41: BACS – Key Lever to Improve Energy-Efficiency of Buildings
Impact Investing BACS – Key Lever to Improve the Energy-Efficiency of Buildings EN15232 Type of BACS / HVAC Controls Expected Energy-saving in HVAC-system High energy- -55% efficiency BACS Advanced -41% BACS Standard BACS -29% No BACS HVAC energy usage (100%) BACS = Building Automation & Control Sys
Slide 42: How much impact can this Field Device create?
Impact Investing How much impact can this Field Device create? Comfort Energy Efficiency Media and Financial Analysts Conference, March 9, 2020
Slide 43: The Method to Calculate the CO2 Impact of Belimo Field Devices
Impact Investing The Method to Calculate the CO2 Impact of Belimo Field Devices “Proxy” HVAC System 1 Air Handling Unit • Ventilation capacity nominal: 7’000 m3/h • Max. thermal capacity: 18 kW heating, 36 kW cooling • 12 field devices (controller, sensors, valves, actuators) 25 VAV Boxes • Nominal
Slide 44: CO2 Impact of a Belimo Field Device
Impact Investing CO2 Impact of a Belimo Field Device Weighted average impact of air-side and water-side field devices in kg of CO2e Media and Financial Analysts Conference, March 9, 2020
Slide 45: Belimo Valves are Becoming ever more Energy Efficient
Impact Investing Belimo Valves are Becoming ever more Energy Efficient Energy Valve ™ ePIV CCV* Energy Measurement Power Control Flow Control Position Control Flow Measurement Delta T Optimization * “Proxy product” used for CO2 impact calculation Media and Financial Analysts Conference, March 9, 202
Slide 46: Media and Financial Analysts Conference, March 9, 2020
Media and Financial Analysts Conference, March 9, 2020 46
Slide 47: Agenda
Agenda 1. Welcoming Remarks, Changes in the Board of Directors Patrick Burkhalter, Chairman of the Board of Directors 2. Financial Year 2019, Sales and Markets Lars van der Haegen, CEO 3. Financial Results 2019 Dr. Markus Schürch, CFO 4. Deep Dive: Impact Investing Dr. Adrian Staufer, Head Strategy
Slide 48: The Megatrends Supporting our Business
Outlook 2020 The Megatrends Supporting our Business Urbanization Higher demand in Comfort, Energy Efficiency Climate Change and Safety in buildings Digitalization Media and Financial Analysts Conference, March 9, 2020 48
Slide 49: Confident of Markets for 2020
Outlook 2020 Confident of Markets for 2020 Overall: Belimo expects a revenue growth slightly below the five-year average. The long-term outlook remains positive with unchanged megatrends as drivers of growth. Increased uncertainty has dampening effect on the short-term and mid-term outlooks.
Slide 50: Publications and Agenda
Publications and Agenda Publication of Annual Report 2019 / Media and Financial Analysts Conference March 9, 2020 Annual General Meeting 2020 March 30, 2020 Dividend Payment April 3, 2020 Publication of Semiannual Report 2020 August 3, 2020 Visitor Day for Analysts September 1, 2020 Publication of S
Slide 51: Agenda
Agenda 1. Welcoming Remarks, Changes in the Board of Directors Patrick Burkhalter, Chairman of the Board of Directors 2. Financial Year 2019, Sales and Markets Lars van der Haegen, CEO 3. Financial Results 2019 Dr. Markus Schürch, CFO 4. Deep Dive: Impact Investing Dr. Adrian Staufer, Head Strategy
Slide 52: Discussion
Discussion Questions? Media and Financial Analysts Conference, March 9, 2020 52
Slide 53: Media and Financial Analysts Conference, March 9, 2020
Media and Financial Analysts Conference, March 9, 2020 53