Aq Group Ab · OMXSTO:AQ
Aq Group Ab — Q3 2024 Earnings Presentation
23 slides from Aq Group Ab's earnings presentation, Oct 17, 2024
Slide 1: AQ Group Investor presentation Q3 2024
Slide 2: Why invest in AQ Group
Why invest in AQ Group EPS CAGR +15% over the past 10 years Profit every quarter since foundation in 1994 Exposure to industrial market segments with underlying growth; Electrification Railway Marine Long history of acquistions. 2-4 factories/year JIT-Mech – 2 factories Rockford – 3 factories TechRO
Slide 3: AQ Group at a glance
Production 8,000 9bSEK 7 Business 15+ Market in 16 Employees Turnover areas segments countries Profit every 2-4 UN Global Deliveries 15% EPS quarter for acquisitions compact globally CAGR 30 years / year since 2012 3
Slide 4: Third Quarter, July-Sept 2024 in brief
=30™ Third Quarter, July-Sept 2024 in brief — aq — Net sales decreased by 9% to SEK 1,949 million (2,149) e Goal >15% growth B Operating profit (EBIT) decreased by 6% to SEK 188 million (201) B Profit after financial items (EBT) decreased by 9% to SEK 177 million (195) IB Profit margin before tax (E
Slide 5: First nine months, Jan-Sept 2024 in brief
=30™ First nine months, Jan-Sept 2024 in brief — aq BH Net sales decreased by 5% to SEK 6,428 million (6,747) e Goal >15% growth B Operating profit (EBIT) increased by 6% to SEK 633 million (599) B Profit after financial items (EBT) increased by 7% to SEK 616 million (575) B Profit margin before tax
Slide 6: EPS Growth
EPS Growth 15% CAGR EPS CAGR 15% 2015-2024Q3LTM EPS growth of -14% vs Q3 2023 and -19% vs. Q2 2024. Increased taxes in the quarter versus same period last year. 6
Slide 7: Net sales
Net sales Lower turnover vs Q3 2023. Growth -9% vs Q3 2023, whereof -2% was currency and +3.5% was acquired. High activity in sales with many nice projects in progress. Half of organic decrease in the quarter is related to energy storage projects that we had in Q3 2023. At the same time we see a dec
Slide 8: Organic growth
Organic growth Organic growth was -11%, below our target of 10%. Lost business for battery systems approx 100mSEK Target 10%/ year (-5%) in Q3. Decrease in inductors for frequency drives and components for construction vehicles, trucks buses & engines. Increases in the quarter mainly in electrificat
Slide 9: Recent new customer/project wins
Recent new customer/project wins Contract for wire harnesses to Norwegian defense customer Contracts for wire harnesses and sheet metal parts to Swedish/Czech/Slovakian defense customers. Orders from for Contract for master controller mechanical enclosures and footrest for Metro line. for inverter c
Slide 10: Acquired Growth
Acquired Growth We reached +3.5% Target 5%/ year acquired growth in Q3. We have more projects in pipeline that we want to buy. 10
Slide 11: AQ JIT Mech update
AQ JIT Mech update ▪ Strong growth in all market segments e.g. electrification, defense and forestry automation. Profitability in line with expectations. ▪ Two large investments ▪ One large 5-axis milling machine installed in Robertsfors is now at full speed ▪ Order placed for huge 20mSEK floor type
Slide 12: AQ Rockford Update
AQ Rockford Update ▪ Higher net sales and better profitability than expected for first two months. Profit in line with AQ average. ▪ Integration ongoing at full speed. ▪ New large contract with Norwegian defense customer won. ▪ Rebranding, core values implementation and a strong focus on joint sales
Slide 13: AQ TechROi background
AQ TechROi background ▪ TechROi is an engineering company with a prototype workshop in Trollhättan, Sweden ▪ It will be combined with AQ Engineering ▪ TechROi is strong in design, development and prototyping for the car, aviation, defense and gas turbine industry. ▪ We believe that an increased shar
Slide 14: EBT Margin
EBT Margin Ok margin in the quarter. Cost control is good. Our decentralized model works. We have decreased approx 1,000 headcount (including temps) since Q3 last year. Prices are almost flat +2% YoY. Opportunities to improve operationally in one site in India. EBT Margin (%) goal is 8% The margin s
Slide 15: Inventory value & turnover development
Inventory value & turnover development Inventory turnover target is 3.5 turns/year. Currently we are stuck at 3. The addition of acquired companies has a negative effect but it does not explain the lower performance. Improvement actions are ongoing and prioritized, but we do not see enough results.
Slide 16: Net cash from operating activities and Net debt
Net cash from operating activities and Net debt Good operating cash flow of 363 mSEK in the quarter which results in net debt ( inc IFRS 16) of -117 mSEK. Mainly driven by good profit level and decreasing working capital because of lower net sales. 16
Slide 17: Investments
=30™ — aq Investments WE ARE RELIABLE 1
Slide 18: Electromagnetic Pulse crimping machine
Electromagnetic Pulse crimping machine ▪ During Q3 we invested in our first EMP crimping machine in AQ Wiring Systems Panevezys for 600kEuro. It is already in operation. ▪ It is used to crimp high voltage cables for large electrical vehicles in the construction, truck and bus industry. ▪ This techno
Slide 19: Solar power plant in Godech Bulgaria
Solar power plant in Godech Bulgaria ▪ In the last days of the third quarter we commissioned our 250 kwp solar power plant in AQ Magnit in Bulgaria. ▪ It will save cost and has a payback time of 5 years. ▪ Reduce CO2-footprint with 160 tons/year. ▪ This is an example where we focus on doing effectiv
Slide 20: Quality and delivery precision
Quality and delivery precision
Slide 21: On-time Delivery and Quality, Jan-Sep
Jan-Sep. On-time Delivery (OTD) Goal 98%, Quality Goal 100% Result OTD YTD: 93% Result Q% YTD: 99,62% Delays are shorter and trend is moving in right direction despite acquiring new businesses that lowers group OTD. We have capacity constraints in JIT- Mech and Rockford. Still challenging to deliver
Slide 22: Why invest in AQ Group
Why invest in AQ Group EPS CAGR +15% over the past 10 years Profit every quarter since foundation in 1994 Exposure to industrial market segments with underlying growth; Electrification Railway Marine Long history of acquistions. 2-4 factories/year JIT-Mech – 2 factories Rockford – 3 factories TechRO
Slide 23: Questions?
soa 3) 2024 Questions? — aQ Qé&G WE ARE RELIABLE 23