Slide 1: Q1 2017
Q1 2017 MÅRTEN ANDERSSON, CEO MATTIAS BJÖRK, CFO 11 MAY, 2017
Slide 2: Today's Presenters
TODAY’S PRESENTERS. MÅRTEN ANDERSSON CEO and Head of Industry • Joined Volati in 2012 and CEO since 2014 • Holds 3.1% ordinary shares and 0.1% preference shares • Background: CEO of Besikta and CEO of Skandia • The General Manager Program at Harvard Business School and BSc in Business and Economics
Slide 3: Volati acquires stable Nordic companies at reasonable valuations
”Volati acquires stable Nordic companies at reasonable valuations and develops them with focus on long-term value creation.” 3
Slide 4: A Robust Business Model
A ROBUST BUSINESS MODEL. …is used for Strong operating acquisitions of …at reasonable ...and with a long- cash flow from additional valuation term approach to the business companies with multiples... value creation units… strong cash flows... ACQUIRED EBITA OPERATING CASH FLOW ACQUISITION MULTIPLES
Slide 5: Financial Development in Q1 2017
FINANCIAL DEVELOPMENT IN Q1 2017. Net sales EBITA1 SEK 744m SEK 40m (661) (38) Operating cash flow2 Q1 SEK -25m (2) 1) EBITA negatively affected by one-off items of SEK2.9m (3.9) 2) Operating cash flow negatively affected by payment of one-off items consisting primarily of IPO related costs of SEK 1
Slide 6: Financial Development LTM Q1 2017
FINANCIAL DEVELOPMENT LTM Q1 2017. Net sales EBITA1 SEK 3,289m SEK 320m (3,206 FY2016) (318 FY2016) Operating cash flow2 LTM SEK 317m (344 FY2016) 1) EBITA negatively affected by one-off items of SEK 32.8m (33.8) 2) Operating cash flow negatively affected by payment of one-off items consisting prima
Slide 7: Continued Strong Growth in Consumer
CONTINUED STRONG GROWTH IN CONSUMER. TRADING CONSUMER INDUSTRY +15% +15% +4% Net sales growth 296 339 249 Q1 2017 216 155 149 Q1 2016 Q1 2017 Q1 2016 Q1 2017 Q1 2016 Q1 2017 +9% +14% (21)%1 EBITA growth 28 Q1 2017 13 14 25 15 12 Q1 2016 Q1 2017 Q1 2016 Q1 2017 Q1 2016 Q1 2017 200 % ROCE 77% Q1 2017
Slide 8: A Proven and Scalable Operating Model
A PROVEN AND SCALABLE OPERATING MODEL. VOLATI’S OPERATING MODEL Decentralised leadership Corporate governance Strategic HR Tools and knowledge Strategic capital allocation M&A 8
Slide 9: Rather turn down a good deal than risk making a bad one
”Rather turn down a good deal than risk making a bad one.” PATRIK WAHLÉN 9
Slide 10: Well-Positioned for Additional Acquisitions
WELL-POSITIONED FOR ADDITIONAL ACQUISITIONS. Well-defined acquisition model and process Ability to manage complex transactions Evaluated ~60 companies, year to date Large acquisition capacity, SEK 204m net cash Ventilatorverken Agro 2008 2007 Väderstad 2004 2005 2006 Ukraina 10
Slide 11: Strong Long-Term Trend
STRONG LONG-TERM TREND. RETURN ON EQUITY SALES AND EBITA NET DEBT % SEKm x 2.79 110% 3 289 2.39 3 206 2.27 34% 762 756 2 188 483 1 656 1 509 43% 45% 32% 25% (265) (204) 18% 326 215 3521 3531 227 1371 2191 318 320 (0.63) (0.48) 2013 2014 2015 2016 Q1 2017 2013 2014 2015 2016 Q1 2017 2013 2014 2015 20
Slide 12: Financial Targets
FINANCIAL TARGETS. METRIC TARGET PERFORMANCE >2.6x 353 SEK 700m Reach an adjusted EBITA of SEK 700m 137 14% EBITA growth at end of 2019 – annual organic EBITA (by 2019) growth of 5% on average Average organic EBITA 2013 2017 LTM growth 2013 – Q1 2017 93% 106% 89% 1 83% 87% Cash conversion >85% Annua
Slide 13: A growing Swedish industrial group
A growing Swedish industrial group
Slide 14: Appendix
APPENDIX. 14
Slide 15: Business Area Trading – Operational Synergies Through Shared Service Centre
BUSINESS AREA TRADING – OPERATIONAL SYNERGIES THROUGH SHARED SERVICE CENTRE. An operational business area • Operating some 15 companies in 6 countries • Organised in 6 business units Iceland Integrated business model • Focused on three market segments: – Construction consumables and hardware (primar
Slide 16: Business Area Consumer – Attractive Niches
BUSINESS AREA CONSUMER – ATTRACTIVE NICHES. A strategic business area • Operating some 9 companies in 5 countries • Organised in 3 business units Strong local entrepreneurship • Business units focused on B2C niches • Strong local entrepreneurship combined with collaboration in selected areas such as
Slide 17: Business Area Industry – Successful Expansion
BUSINESS AREA INDUSTRY – SUCCESSFUL EXPANSION. A strategic business area • Operating some 19 companies in 14 countries • Organised in 3 business units Strong local entrepreneurship • Business units focused on B2B niches • Strong local entrepreneurship combined with collaboration in selected areas su
Slide 18: Income Statement
INCOME STATEMENT. SEKm 2013 2014 2015 2016 LTM Net sales 1,509 1,656 2,188 3,207 3,289 Raw materials and supplies -549 -547 -933 -1,526 -1,560.1 Other external costs -274 -347 -413 -516 -533.9 Personnel costs -518 -513 -582 -771 -799.7 Other income 3 3 18 4 3.8 Other operating costs -2 -2 -3 -12 -9.
Slide 19: Balance Sheet
BALANCE SHEET. SEKm 31 Dec '13 31 Dec '14 31 Dec '15 31 Dec '16 31 Mar ‘17 Intangible fixed assets 860 1,160 1,689 1,840 1,827 Tangible fixed assets 141 138 180 191 186 Financial fixed assets 8 8 13 8 8 Other non-current marketable securities 4 4 7 - - Deferred tax assets 16 21 33 42 43 Total non-cu
Slide 20: Net Debt and Working Capital
NET DEBT AND WORKING CAPITAL. SEKm 31 Dec '13 31 Dec '14 31 Dec '15 31 Dec '16 31 Mar ‘17 Net debt Cash and cash equivalents -157 -156 -200 -371 -285 Pension liabilities 2 2 2 3 3 Non-current interest-bearing liabilities 441 1055 908 54 51 Current interest-bearing liabilities 497 165 133 73 51 Unrea
Slide 21: Cash Flow Statement
CASH FLOW STATEMENT. SEKm 2013 2014 2015 2016 LTM Profit before tax 267 61 161 254 253 Adjustment for non-cash items -116 172 96 122 127 Interest paid -24 -58 -45 -39 -31 Interest received 1 3 1 1 1 Cash taxes -33 -18 -19 -42 -40 Cash flow before changes in working capital 96 160 196 295 309 Change
Slide 22: Definitions of Key Metrics
DEFINITIONS OF KEY METRICS. Metric Explanation Adjusted Explanation Business area return on capital employed (BA BA EBITA in relation to BA capital employed - - ROCE) Cash conversion excluding capex related to Besikta IT Cash conversion Operating cash flow in relation to EBITDA Adj. cash conversion