Munters Group Ab · OMXSTO:MTRS
Munters Group Ab — Investor Day (May 2020)
56 slides from Munters Group Ab's investor day presentation, May 28, 2020
Slide 1: Capital Markets Update
Munters Capital Markets Update 28 May 2020
Slide 2: Agenda Munters Capital Markets Update
Agenda Munters Capital Markets Update Introduction Strategy Sustainability roadmap Performance management Business Areas Q&A 2
Slide 3: We are part of the solution to meet challenges caused by climate change
We are part of the solution to meet challenges caused by climate change Our purpose: For Customer Success and a Healthier Planet
Slide 4: We make a difference for the world
We make a difference for the world Munters enables farms to Munters VOC* systems can Munters equipment cleans appr. reduce poultry infection and use absorb 99% of targeted 20% of the world’s electricity of antibiotics, with stronger yield hazardous substances from production and animal welfare indoo
Slide 5: A truly global company
A truly global company Manufacturing site AirTech • Munters is a global leader in innovative, energy- Assembly site FoodTech efficient and sustainable climate solutions for mission-critical processes • Founded in 1955 • ~ 3,100 employees • 2 business areas: AirTech & FoodTech* • 25% (20) women in se
Slide 6: Munters creates value in many industries
Munters creates value in many industries AirTech FoodTech • Munters offers climate solutions to customers in many different industries • Complete systems and solutions yield FMCG* & Retail Data Centers Electronics higher quality, increased productivity and lower energy consumption • Munters products
Slide 7: Core technologies – Dehumidification and evaporative cooling
Core technologies – Dehumidification and evaporative cooling Shared Product Platforms AirTech offering FoodTech offering Evaporative cooling pads Indirect evaporative Dedicated out- High-efficiency fans Cooling Systems coolers (Oasis) door air systems Controllers Dehumidifiers Retrofit / Upgrades Ai
Slide 8: Stable profitability, challenging business environment
Stable profitability, challenging business environment MSEK Net sales • In the first quarter order intake and net sales impacted 8000 by the Covid-19 outbreak 7000 6000 ‒ Order intake declined organically by -8% 5000 ‒ Net sales declined organically by -7% 4000 3000 • Adj. EBITA-margin in first quar
Slide 9: Agenda Munters Capital Markets Update
Agenda Munters Capital Markets Update Introduction Strategy Sustainability roadmap Performance management Business Areas Q&A 9
Slide 10: Munters – unique application knowledge
Munters – unique application knowledge Market trends: Customer needs: Munters offering: • Proven energy efficient • Climate change products and solutions • Increased energy efficiency with higher • Unique application knowledge • Population growth yields, less waste, • Strong global market position,
Slide 11: Refined strategy enabler for reaching mid-terms targets
Refined strategy enabler for reaching mid-terms targets Refined strategic priorities Mid-term targets Net sales growth Annual growth in organic net sales 5% starting in 2019, supplemented with add- on acquisitions. Adjusted EBITA-margin An adjusted EBITA-margin in the medium 14% term. Capital struct
Slide 12: For customer success and a healthier planet
Munters strategic priorities For customer success and a healthier planet 12
Slide 13: Customers
Customers Customers Munters ambition: Be the customers trusted adviser for energy efficient production processes related to climate control Focus areas 2020 Beyond • Commercial excellence Customer value throughout the value • Commercial excellence chain role in Munters • Value selling an • On-going
Slide 14: Framework agreement in China – FoodTech
Customers Framework agreement in China – FoodTech • Frame agreement with a Chinese customer in the Swine segment (valued at MSEK >100) • Munters will supply ventilation and climate control system to large-scale farms; delivered over two years • Improvement in the market after the previously weak dem
Slide 15: Innovation
Innovation Innovation Munters ambition: Create the solutions of tomorrow, today Focus areas 2020 Beyond Focused R&D • Strengthened market • Focus on core position in core investments technologies and technologies sustainability • Target to reduce product Product portfolio • Continued work on assortm
Slide 16: Modularization and digitalization enables SKU alignment
Innovation Modularization and digitalization enables SKU* alignment Munters target reduce product assortment by 40% from start of 2019 to end of 2022. *Product assortment defined as Stock Keeping Units = SKUs AirTech examples: AirC controller • Modularized platform for small units. Reduction of prod
Slide 17: Munters – Air treatment technology
Innovation Munters – Air treatment technology • Adsorption dryers • VOC abatement DEC • Evaporative humidifiers • Adiabatic cooling (evaporative humidifiers/coolers) ‒ Direct (DEC) or indirect systems (IEC) IEC • Purification of air flows with mist eliminators removes droplets, soot and dust VOC = V
Slide 18: Moisture matters (examples)
Innovation Moisture matters (examples) With reduced humidity Reduced humidity reduces risk Risk of mold and fungi lower or no corrosion of short circuits increases with higher humidification Over insulation material Crawl space under house 18
Slide 19: Markets
Markets Markets Munters ambition: Market leader in our prioritized markets and segments. Focus areas 2020 Beyond • Market position 1-3 in Prioritized markets • Prioritized markets includes prioritized markets several segments, products • Higher degree of data and regions driven products and • Data d
Slide 20: Remote assistance to ensure safety and efficiency
Markets Remote assistance to ensure safety and efficiency • Munters uses IFS Remote Assistance™ in Service operations to ensure safety of field staff while delivering increased efficiency • Merged Reality (MR) solution that enables field technicians, engineers or customers to share real-life situati
Slide 21: Excellence in everything we do
Excellence in everything we do Excellence in everything we do Ambition: Never settle for good, constantly improve and strive for excellence in every step of the value chain. Focus areas 2020 Beyond Best practices processes • Action plan for • Aligned processes strengthening all throughout the whole
Slide 22: Successful improvements in Monterrey plant
Excellence in everything we do Successful improvements in Monterrey plant Employee turnover (percentage) • Munters manufacturing plant in Monterrey, Mexico produces 18% 15.5% 16% mainly evaporative cooling pads 14% 12% • Previously struggled with deliveries and quality issues 10% 8% 7.3% • A new man
Slide 23: People
People People • People are at the heart of our strategic priorities • Developing people and leaders are essential to drive our priorities and achieve our goals • Munters promotes multiple career opportunities, both in different disciplines and regions • Driving diversity is important for innovation
Slide 24: Organizational redesign and people development
People Organizational redesign and people development The organizational structure adapted to be more business oriented and customer focused, with: Organizational structure as of March, 2020 • Clearer business ownership, aligning value chain within CEO, Klas Forsström Business Areas, capturing logic
Slide 25: Agenda Munters Capital Markets Update
Agenda Munters Capital Markets Update Introduction Strategy Sustainability roadmap Performance management Business Areas Q&A 25
Slide 26: Sustainability strategic driver for Munters
Sustainability strategic driver for Munters • Sustainability is incorporated into everything we Munters Sustainability agenda - eight prioritized areas: do, covering: • Design our products • How we operate our business • The energy efficiency and yield provided to the customers through our products
Slide 27: Sustainability in 2020 and beyond
Sustainability in 2020 and beyond 2019 2020 Beyond • Analysis of current situation, • Analysis and deep-dive into all • Strong ambition to become more including short- and long term areas defined during fall of 2019 transparent around energy- financial and strategic ambitions efficiency of our produ
Slide 28: Munters contributes to more sustainable agriculture
Munters contributes to more sustainable agriculture • Munters products and solutions increase efficiency of farms as well as animal welfare • Munters contribute to more sustainable livestock keeping by developing full farm solutions, providing a perfect climate for the animals and a high farm produc
Slide 29: Munters contribution to the emission reduction
Munters contribution to the emission reduction Indirect contribution: Emission breakdown poultry house • Feed conversion ratio improvements • Feed delivery & production planning optimization Feed, CO₂ 6,30% 1,30% • Reducing the manure quantity per kg of meat Applied & deposited manure, N₂O 6,40% • H
Slide 30: Journey ahead supported by strong market drivers
Journey ahead supported by strong market drivers • Strong market drivers support long-term demand for Munters products and solutions • Sustainability important, current business environment highlights the importance even more • High demand for clean air in many industries with mission critical proce
Slide 31: Agenda Munters Capital Markets Update
Agenda Munters Capital Markets Update Introduction Strategy Sustainability roadmap Performance management Business Areas Q&A 31
Slide 32: Q1 2020 vs. Mid-term targets
Q1 2020 vs. Mid-term targets Mid-term Q1 targets 2020 Net sales growth Annual growth in organic net sales 5% -7% starting in 2019, supplemented with add- on acquisitions. Adjusted EBITA-margin An adjusted EBITA-margin in the medium 14% 8.3% term. Capital structure (LTM*) A ratio of net debt to adjus
Slide 33: Strengthened financial position
Strengthened financial position • Initiative to improve working capital efficiency has led to decreased leverage and increased focus on cash management • Continued focus on cash conversion (improving profits and working capital) Development of leverage Operating working capital as % of net sales Cas
Slide 34: Performance management
Performance management • Plan and set aligned objectives Analyze & HR Plan Mitigate Operations • Integrate all steps of the value chain Strategy Sales and marketing Execution • Drive timely execution and close gaps Finance & Strategy IT R&D Profitable, Cash-generating, Growth Manage & Monitor 34
Slide 35: World-class processes throughout the value chain
World-class processes throughout the value chain • Excellence in everything we do requires strengthened ways of working; work initiated to ensure world-class processes throughout the value chain • Aiming at ensuring scalability and contribute to profitable, cash-generating growth All processes throu
Slide 36: Agenda Munters Capital Markets Update
Agenda Munters Capital Markets Update Introduction Strategy Sustainability roadmap Performance management Business Areas Q&A 36
Slide 37: Global leader in dehumidification and cooling solutions for demanding industrial applications
Global leader in dehumidification #1 position in markets and cooling solutions for representing majority of AirTech net 72% of Group net sales in 2019 demanding industrial applications sales 37 37
Slide 38: Munters part of the global Covid-19 pandemic response
Munters part of the global Covid-19 pandemic response Since March 14th, Munters has supported several Covid-19 response applications. Supporting Indoor climate application: Supporting critical production: • Clean rooms • Covid-19 test kits • Cooling chambers • Plastics parts used in test kits • Stor
Slide 39: AirTech – For Customer Success and a Healthier Planet
AirTech – For Customer Success and a Healthier Planet We reduce global energy consumption every Blue-chip customer base year by the equivalent of the usage of more than 1 million households We support the transition from combustion-driven cars to electric cars powered by Lithium batteries Solid grow
Slide 40: AirTech - Core competences in high performance dehumidification
AirTech - Core competences in high performance dehumidification AirTech TECHNOLOGIES APPLICATIONS Cooling and Core Rotor-based high-performance Industrial manufacturing, preservation DC other HVAC DH dehumidification (DH) areas and various other applications Humidi- fication Com- Rotor-based dehumid
Slide 41: We provide a broad offering of sustainable solutions
We provide a broad offering of sustainable solutions Core ME DC DC DH Dry Coolers - eg Mist Eliminators Core Heat Exchangers Rental DH Thermosyphon (SyCool) Core DC Core VOC DH DH Portable / Small Indirect Evaporative VOC elimination rotors DC Spare parts dehumidification Coolers (Oasis) Com- mercia
Slide 42: Munters leader across prioritized markets
Munters leader across prioritized markets Size in Markets Long-term market outlook Munters DC Data Center Strong growth driven by increased usage of cloud- L Cooling based solutions Core DH Lithium Battery M Strong growth driven by electrical vehicle transition Dehumidification Core DH General Indus
Slide 43: AirTech to strengthen, expand and build
AirTech to strengthen, expand and build STRENGTHENING • Stabilize, improve and innovate to grow our core dehumidification business for mission-critical applications • Prioritize fast-growing Food and Battery markets and Services – while serving many other customer segments as well EXPANDING • Provid
Slide 44: Initiatives enabling growth
Initiatives enabling growth Enabler themes Alignment and People and Commercial Processes and Innovation Efficiency Governance Knowledge Excellence Tools Secure that governance Ensure that key Drive innovation to Secure ways of working Develop processes and Focus on actions to Objective and follow up
Slide 45: How important is proven CO2 savings?
How important is proven CO2 savings? What is the cost of water and water discharge? How much is 30% energy savings worth for you?
Slide 46: Munters make the difference in Data Center solutions
Munters make the difference in Data Center solutions, improving total cost with reduced use of energy and water Data Center USPs Selling on customer value ‒ Reliability – no need to exchange the pads every 2-3 years ‒ Low pressure drop – 20 pa pressure drop costs 0.5 kW / fan. ‒ Ability to withstand
Slide 47: Share of Munters' sales 2019
Share of Munters’ sales 2019 28% 4747
Slide 48: FoodTech – We help to feed the world
FoodTech – We help to feed the world Create the perfect • Offer equipment and solutions climate to create the optimal climate for For customer livestock and greenhouse success and a production, including hardware and know-how/design Our contribution to healthier planet – our customers and We help to
Slide 49: FoodTech's equipment offering
FoodTech’s equipment offering Heaters Cooling Air inlets systems Fans Broiler house Air cleaners and Heat recovery units Air circulators Climate Controllers Sensors 49
Slide 50: FoodTech's software offering
FoodTech’s software offering Integrator End-customer Management software for poultry and Feed mill swine producers Cloud-based management software for Retailer small and medium-sized producers Production planning powered by AI Breeder farm Real time data collection from farms Broiler farm Hatchery 5
Slide 51: FoodTech overview
FoodTech overview Selected customers Sub-segments (Share of Net sales 2019) 5% 3% 6% Broiler Swine Financial performance 16% 42% Layer Digital Net sales (MSEK) CAGR +1% CAGR +14% Greenhouse 1 837 2 018 2 032 Dairy 1 705 1 363 28% 2015 2016 2017 2018 2019 Adj EBITA margin 13% 16% 13% 12% 14% 51
Slide 52: Market leader in several geographical markets
Market leader in several geographical markets Markets Size in Munters Long-term market outlook Broiler (Chicken) L Solid growth driven by developing markets Layer (Eggs) M Demand for cage-free production to drive growth, especially in US Strong growth in Asia medium-term driven by recovery after Afr
Slide 53: Looking ahead - The FoodTech strategy
Looking ahead - The FoodTech strategy Customer Focus Excellence in everything we do Connect our customers Make it easy to do supply chain business with us Our direction Innovation Excellence in everything we do Create the Perfect Collaborate with Focus areas Climate partners Market Excellence in eve
Slide 54: Agenda Munters Capital Markets Update
Agenda Munters Capital Markets Update Introduction Strategy Sustainability roadmap Performance management Business Areas Q&A 54
Slide 55: Q&A
Q&A 55
Slide 56: Munters – Your Perfect Climate
( Munters Your Perfect Climate