Indutrade Ab · OMXSTO:INDT
Indutrade Ab — Q4 2019 Earnings Presentation
24 slides from Indutrade Ab's earnings presentation, Feb 5, 2020
Slide 1: Year-End Report 2019
An entrepreneurial world where people make the difference Bo Annvik, CEO Year-End Report 2019 Patrik Johnson, CFO 5 February 2020
Slide 2: Summary 2019
Summary 2019 ▪ Successful year with focus on sustainable profitable growth – business model and strategy stand strong ▪ Demand on high level but flattening out ▪ Strong financial performance with record high EBITA margin of 12.7% ▪ Good acquisition pace – 15 companies acquired with total sales of SE
Slide 3: Highlights fourth quarter 2019
Highlights fourth quarter 2019 ▪ Demand flattening out with variations between companies, segments and markets ▪ Sales organically in line with last year and order intake declined slightly ▪ Record high EBITA margin in Q4 ▪ Improved cash flow during the quarter, working capital still on a slightly h
Slide 4: Order intake
Order intake QUARTERLY GROWTH Q GROWTH FY GROWTH R3Y CAGR 4,752 MSEK +8% +9% +11% 4
Slide 5: Net sales
Net sales QUARTERLY GROWTH 0% Q GROWTH FY GROWTH R3Y CAGR 4,863 MSEK +9% +9% +12% 5
Slide 6: EBITA
EBITA QUARTERLY GROWTH *) Excluding restructuring costs 2017-Q4 Q GROWTH FY GROWTH R3Y CAGR 631 MSEK +11% +12% +17% 6
Slide 7: Organic sales growth by Business Area
Organic sales growth by Business Area Total growth: +36% +20% -2% +9% +1% -2% +7% +22% ▪ Relatively large variation between Business Areas, companies, segments and markets ▪ Strong comparable numbers same period last year ▪ Weaker general European industrial activity, impacting the majority of the B
Slide 8: EBITA margin by Business Area
EBITA margin by Business Area ▪ Improvements in Business Areas Finland, Flow Technology and Industrial Components driven mainly by strong MedTech- and Marine segments and divestments ▪ Strongest development in Business Area Benelux driven by valves for power generation and a positive non- recurring
Slide 9: Acquisitions & Divestments 2019
Acquisitions & Divestments 2019 Acquisitions Business Area Annual Sales Q1 Weldability Sif UK 100 MSEK STRIHL Scandinavia AB Fluids & Mechanical Solutions 60 MSEK Q2 Acumo AB Industrial Components 60 MSEK QbiQ Group B.V. Benelux 320 MSEK Adam Equipment Co Ltd Measurement & Sensor Technology 150 MSEK
Slide 10: Acquisitions 2020
Acquisitions 2020 Acquisitions Business Area Annual Sales STEIN Automation GmbH DACH 110 MSEK Q1 VarioDrive BV Benelux 60 MSEK AVA Monitoring AB Measurement & Sensor Technology 45 MSEK Sverre Hellum & Sønn AS Industrial Components 60 MSEK
Slide 11: Key data summary
Key data summary MSEK 2019-Q4 2018-Q4 Change 2019-YTD 2018-YTD Change Order Intake 4,752 4,403 8% 18,653 17,073 9% Net Sales 4,863 4,446 9% 18,411 16,348 9% Gross margin, % 34.2 34.2 34.1 34.1 EBITA 631 568 11% 2,330 2,087 12% EBITA-margin, % 13.0 12.8 12.7 12.4 Net financial items -37 -16 131% -124
Slide 12: Overview IFRS 16 effects
Overview IFRS 16 effects Item / KPI Net debt Finance net Depreciation EBITA EBITDA Net debt / equity Impact +842 MSEK -24 MSEK -290 MSEK +24 MSEK +290 MSEK +12%-points Comment Opening balance Increased costs YTD-2019 Increased costs YTD-2019 Increased costs YTD-2019 Increased result YTD-2019 Approxi
Slide 13: Cash Flow from operating activities
Cash Flow from operating activities ▪ Cash flow from operating activities grew 23% from 732 MSEK to 594 MSEK ▪ Growth versus last year partly driven by IFRS 16 but also from a higher result and a slightly better working capital development ▪ Working capital still on slightly high level, mainly due t
Slide 14: Earnings per share
Earnings per share ▪ Q4 earnings per share grew 8% to SEK 3.29 (3.05) ▪ Full year earnings per share increased with 8% to SEK 12.26 (11.31) ▪ Improvement driven by higher EBITA, but partly offset by increased amortizations of intangibles and financing costs ▪ 3- and 5-year earnings per share CAGR, w
Slide 15: Net debt
Net debt ▪ The interest-bearing net debt end of Q4 increased to 6,130 (3,909) MSEK ▪ Driven by the high acquisition pace and the implementation of IFRS 16 ▪ Net debt/equity ratio increased to 85% (63%). The ratio would have been approximately 73% excluding IFRS 16 effects. 15
Slide 16: Sustainability as a business opportunity
Sustainability as a business opportunity ▪ Indutrade signatory of the UN Global Compact (UNGC) ▪ Updated materiality analysis on Group level ▪ Workshop and training for all MDs ▪ Mandatory part of the strategic board meeting for all companies ▪ “Toolkit” to support the companies 16
Slide 17: Increased focus on Sustainability
Increased focus on Sustainability As of 2020 we have decided to start measuring a few social and environmental group metrics: ▪ Injury frequency rate ▪ Sickness Absence ▪ Employee Turnover Ratio ▪ CO2e emissions (scope 1 & 2) ▪ Share of renewable energy
Slide 18: Good conditions for stability
Good conditions for stability ▪ Our diversified structure creates good conditions for stability ▪ Decentralised business model – agile companies adapting to changing conditions by making decisions at local level and working closely with their customers ▪ Strong culture – MDs ownership and accountabi
Slide 19: Financial targets and outcome 2019
Financial targets and outcome 2019 Return Proposed Growth EBITA margin on capital Net debt/Equity dividend employed payout ratio 9%* 12.7% 19% 85% 39% TARGET ≥ 10% TARGET ≥ 12% TARGET ≥ 20% TARGET ≤ 100% 30%-50% OF NET PROFIT *) 10 % excluding divestments Targets measured over a business cycle 19
Slide 20: Revised financial target – Dividend policy
Revised financial target – Dividend policy Proposed The Board’s ambition is to offer the dividend shareholders an attractive dividend yield and payout ratio high dividend growth. Acquisitions have been, and will continue to be, an important key driver 39% for growth. The revised dividend policy enab
Slide 21: Key takeaways
Key takeaways ▪ Successful 2019 with record high profitability ▪ Demand continued at good level, but flattened out with variation between companies and segments ▪ Stable level of earnings ▪ Continued high pace of acquisitions and opportunities remain good ▪ Diversified business group with agile and
Slide 22: Thank you! Q&A
Thank you! Q&A Indutrade
Slide 23: Trusted by entrepreneurs
Trusted by entrepreneurs 23
Slide 24: Financial Calendar & contact details
Financial Calendar & contact details 27 April 2020 Interim Report 1 January – 31 March 2020 6 May 2020 - Annual General Meeting 17 July 2020 Interim report 1 January – 30 June 2020 20 October 2020 Interim report 1 January – 30 September 2020 Contact: Frida Adrian VP Communications, Sustainability an