Slide 1: NORMA Group SE Full Year Results 2017
NORMA Group SE Full Year Results 2017 Maintal, March 21, 2018 1
Slide 2: Highlights 2017 – Strategy
Highlights 2017 – Strategy Successful acquisition of Lifial, Portugal, who has been manufacturing metal clamps for 28 years for use in M&A industry and agriculture Successful acquisition of Fengfan, China, who has been manufacturing joining products made of stainless steel, M&A nylon and specialty m
Slide 3: Highlights 2017 – Financials (I)
Highlights 2017 – Financials (I) Sales Sales of EUR 1,017.1 million (2016: EUR 894.9 million) leads to growth of 13.7% Adjusted Adjusted EBITA of EUR 174.5 million (2016: EUR 157.5 million) EBITA Margin Adjusted EBITA margin at 17.2% (2016: 17.6%); 8th year of sustainable margin higher than 17.0% Ta
Slide 4: Highlights 2017 – Financials (II)
Highlights 2017 – Financials (II) Strong balance sheet with an equity ratio of 40.7% (2016: 36.2%) despite dividend and acquisition payments Equity including positive US tax effect Net debt* decreased to EUR 343.4 million (2016: EUR 392.0 million) including the acquisitions financing and Net Debt* d
Slide 5: Sales by Region
Sales by Region Regional Split Sales EMEA • EMEA: Solid growth in EJT includes (in % actual vs. (prev. year)) (in EUR million) favorable OEM business while DS sales were also positive – this led in total to a 12% +12.5% growth of +12.5% including negative 500 currency effects and consolidation of (9
Slide 6: Sales of EUR 1,017.1 million with Solid Organic Growth of 8.6%
Sales of EUR 1,017.1 million with Solid Organic Growth of 8.6% • Solid organic growth of 8.6% mainly due to an increase of the global production output of the passenger and commercial vehicle markets as well as new customer and contract wins which led to a high demand for joining products in all reg
Slide 7: Historic Growth Track Record
Historic Growth Track Record Historic Revenue Development in EUR million 1,017 890 895 695 605 636 581 458 490 385 330 277 229 242 182 198 207 150 174 121 138 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 1997 to 2017: 20 years of a successf
Slide 8: Sustainable Margin Development Continued in 2017
Sustainable Margin Development Continued in 2017 FY 2015: FY 2016: FY 2017: 17.6% 17.6% 17.2% EUR million 160 20.3% 20.4% 20.4% 20.8% 20.4% 20.2% 20.1% 20.0% 19.9% 20.1% 20.0% 20.1% 20.0% 20.0% 18.9% 18.5% 18.9% 18.5% 20% 140 17.7% 17.7% 17.7% 18.1% 18.0% 17.7% 17.9% 17.7% 17.7% 17.4% 17.4% 17.5% 17
Slide 9: NORMA Group well on Track for Coming E-Mobility Developments
NORMA Group well on Track for Coming E-Mobility Developments Battery Thermal Management Growth Coolant Systems perspec- Power Electronics and Motors Cooling tives HVAC / Heat Pump Systems NORMA Group will benefit from a graduated hybridization Content per engine type ICE, Hybrid & EV development* Co
Slide 10: Future Developments in Content per Vehicle
Future Developments in Content per Vehicle Battery Electric Vehicle Hybrid Gasoline • Exhaust system and combustion engine parts being replaced with new • Additional products e.g. for thermal management business opportunities for thermal management and other components Exhaust system Cooling Thermal
Slide 11: Acquisition of Lifial
Acquisition of Lifial M&A Acquisition of Lifial – Indústria Metalúrgica de Águeda, Lda. (‘Lifial’), Portugal, in January 2017 Business Manufacturer of metal clamps for the use in industry and agriculture (distribution business) Model Based in Águeda, Portugal For more than 28 years the company has b
Slide 12: Acquisition of Fengfan
Acquisition of Fengfan M&A Acquisition of 80% of Fengfan Fastener (Shaoxing) Co., Ltd. (‘Fengfan’), China Business Manufacturer of joining products made of stainless steel, nylon and specialty materials Model Based in Shaoxing City, China Founded in 1988, the company has been manufacturing cable tie
Slide 13: 12 Acquisitions since the IPO in 2011
12 Acquisitions since the IPO in 2011 representing 43% of Sales in 2011 Sales Consolidation Effects Date of Total (in EUR million) Acquisition Sales CONNECTORS Verbindungstechnik AG, Switzerland 04/12 Market entry in connecting technology in Pharma & Biotech 16.6 Nordic Metalblok S.r.l., Italy 07/12
Slide 14: Balanced Industry Mix with Two Strong Ways to Market
Balanced Industry Mix with Two Strong Ways to Market* thereof water management thereof industrial supplier 18% (19%) 32% (29%) DS 37% (40%) EJT 19% 63% (60%) (21%) thereof general thereof distribution products commercial vehicle OEM 10% (5%) 21% (26%) thereof passenger vehicle OEM * FY 2017 (2016 in
Slide 15: Adjusted EBITA of more than 17% for the 8th Consecutive Year
Adjusted EBITA of more than 17% for the 8th Consecutive Year Adjusted Material Costs Adjusted Personnel Expenses • Material costs ratio up by 180 basis (in EUR million and % of sales) (in EUR million and % of sales) points mainly due to higher alloy surcharges and consolidation of 39.4% 41.2% 50% 40
Slide 16: Operational Adjustments on EBITA level
Operational Adjustments on EBITA level • Operational adjustments from the Autoline, Lifial and Fengfan acquisitions in 2017 of EUR 3.5 million in EUR million 2010 2011 2012 2013 2014 2015 2016 2017 Reported EBITA 64.9 84.7 105.2 112.1 113.3 150.5 150.4 166.8 + Restructuring costs 1.3 1.8 0 0 0 0 0 0
Slide 17: Operational Adjustments 2017
Operational Adjustments 2017 • Operational adjustments on EBITDA level due to the recent acquisitions • Higher reported EPS of EUR 3.76 compared to adjusted EPS of EUR 3.29 due to positive one-off non-cash US tax effect of EUR 1.06 per share • Tax effect overcompensated operational and PPA adjustmen
Slide 18: Outlook on Adjustments 2018 – 2019
Outlook on Adjustments 2018 – 2019 in EUR million FY 2017 FY 2018* FY 2019* 3.5 EBITDA level (incl. EUR 2.9 million integration costs & EUR 1.1 million 0 0 inventory-step-ups & EUR -0.5 million reimbursement of transaction taxes) 7.7 ca. 4 ca. 3 EBITA level (incl. EUR 4.2 million depreciation PPA) (
Slide 19: EPS – Dividend Proposal of EUR 1.05 per Share
EPS – Dividend Proposal of EUR 1.05 per Share • Dividend proposal to the shareholders at the AGM on May 17, 2018: EUR 1.05 per share (2017: EUR 0.95) • Pay-out of EUR 33.5 million for 31,862,400 shares (31.9% of adjusted Group net profit of EUR 105.0 million) • General policy: dividend of 30% to 35%
Slide 20: Profit & Loss (adjusted & reported)
Profit & Loss (adjusted & reported) in EUR million Adjusted Reported 2016 2017 2016 2017 Sales 894.9 1,017.1 894.9 1,017.1 Gross profit 545.6 601.3 544.9 600.2 EBITDA 179.4 199.7 174.6 196.3 in % of sales 20.0 19.6 19.5 19.3 EBITA 157.5 174.5 150.4 166.8 in % of sales 17.6 17.2 16.8 16.4 EBIT 147.7
Slide 21: Working Capital Development
Working Capital Development • Trade working capital ratio further improved in 2017 to 15.6% of sales • In 2017 inventories and trade payables improved, trade receivables increased mainly due to high business activity in Q4 2017 and longer payment terms in strong growing Asia-Pacific region EUR milli
Slide 22: Equity Ratio on Strong Level of 40.7%
Equity Ratio on Strong Level of 40.7% • Equity increased by EUR 50 million with strong profit of EUR 120 million • Equity ratio increased despite currency changes and dividend payment due to a strong business activity including positive US tax effect EUR million -30 600 -40* 40.7% 36.2% 120 500 400
Slide 23: Net Debt and Financing
Net Debt and Financing Net Debt* (in EUR million) 392 343 600 Leverage** Dec 31, 2016 Dec 31, 2017 400 558 (Net debt* / adjusted LTM EBITDA) 2.1 x 1.7 x 498 200 0 Gearing Dec 31, 2016 Dec 31, 2017 -166 -155 (Net debt* / equity) 0.8 x 0.6 x -200 Dec 31, 2016 Dec 31, 2017 Cash Debt * excl. derivative
Slide 24: Solid Maturity Profile
Solid Maturity Profile Maturity Profile (in EUR million) – Financial Instruments Promissory Note 3 Promissory Note 2 Promissory Note 1 Bank Borrowings 103 63 65 41 5 26 5 5 29 5 33 45 42 21 2018 2019 2020 2021 2022 2023 2024 2025 2026 Maturity Profile (in EUR million) – Currencies USD EUR 79 51 4 51
Slide 25: Solid Development of Balance Sheet
Solid Development of Balance Sheet in EUR million Dec 31, 2016 Dec 31, 2017 in EUR million Dec 31, 2016 Dec 31, 2017 Assets Equity and liabilities Non-current assets Equity Goodwill / Other intangible assets / 865.5 817.6 Total equity 483.6 534.3 Property, plant & equipment Other non-financial asset
Slide 26: Solid Net Operating Cash Flow in 2017
Solid Net Operating Cash Flow in 2017 Net Operating Cash Flow in EUR million 2011 2012 2013 2014 2015 2016 2017 Variance Adjusted EBITDA 117.0 120.8 129.3 138.4 177.5 179.4 199.7 +11.4% Δ ± Working capital -19.5 -9.8 +5.1 +10.4 -0.6 +17.0 -19.1 n/a Net operating cash flow before investments 97.5 111
Slide 27: Outlook 2018 – Strategy
Outlook 2018 – Strategy 1 Continue to develop product and service solutions for 2 Expanding water business Continue to explore business opportunities particularly in Asia-Pacific to expand regional business and further 3 improve profitability 4 Continue dialogue with potential M&A targets in various
Slide 28: Outlook 2018 – Macroeconomic Forecast – GDP Growth
Outlook 2018 – Macroeconomic Forecast – GDP Growth* in % 2017 2018e 2019e World +3.7 +3.9 +3.9 USA +2.3 +2.7 +2.5 China +6.9 +6.6 +6.4 Euro zone +2.5 +2.2 +2.0 Germany +2.2 +2.5 +2.2 • VDMA (German Engineering Federation) expects worldwide machine sales to grow by 4% in 2018 • Euroconstruct expects
Slide 29: Outlook 2018 – Company Guidance
Outlook 2018 – Company Guidance Sales Solid organic growth of around 3% to 5%, additionally around EUR 5 million from acquisitions Adjusted EBITA Sustainable at the same level as in previous years of more than 17.0% Margin Adjusted Roughly at the same level as in previous years Material Cost Ratio A
Slide 30: Outlook 2018 – Company Guidance
Outlook 2018 – Company Guidance Investments in R&D Approx. 5% of EJT sales Innovations More than 20 new invention applications p.a. Quality Proportion of defective parts in production to be below the value of 20 parts per million Quality Number of quality-related customer complaints per month to be
Slide 31: NORMA Group – Key Investment Highlights
NORMA Group – Key Investment Highlights 1 Market leader in attractive engineering niche markets 2 Strong development and growth opportunities in e-mobility and water management 3 Enhanced stability through broad diversification across products, end markets and regions Engineered products with premiu
Slide 32: Appendix
Appendix 32
Slide 33: NORMA Group’s Key Facts
NORMA Group’s Key Facts Specific customer requirements driven by megatrends Global market and technology Offers more than 40,000 innovative NORMAFLUID ® joining solutions in three product Delivers to more than leader in joining and fluid 42% Clamp, Connect, Fluid categories: 10,000 customers in 100
Slide 34: Proven Business Model Addressing Key Megatrends
Proven Business Model Addressing Key Megatrends Specific customer requirements driven by megatrends • Continuous new developments on a • Superior service level through worldwide Product Emission global level in order to fulfill fleet presence and regional sales hubs availability reduction consumptio
Slide 35: Tighter Emission Regulations Drive Increased Joining Technology Content
Tighter Emission Regulations Drive Increased Joining Technology Content Today Europe Euro 5 Euro 6 Euro 7 NAFTA EPA ‘07 EPA Tier 3 - Clean Air Act Brazil Euro 4 Euro 5 Euro 6 Russia Euro 4 Euro 5 Euro 6 India Euro 4 Euro 5 Euro 6 Euro 7 China Euro 4 Euro 5 Euro 6 2010 2012 2014 2016 2018 2020 2022 2
Slide 36: Fleet Efficiency Europe: Innovation Rate must Double
Fleet Efficiency Europe: Innovation Rate must Double EU legislation required CO2 fleet average limits 2007 2015 2020 2021 2025 2030 158.7 g/km 130 g/km 95 g/km ~ 81 g/km* 67 g/km* [95%] [100%] Reduction from Reduction of 27% during 6 years Emission reduction of 2007 to 2015 (5.1% p.a.) 15% resp. 30%
Slide 37: Innovation Rates
Innovation Rates* Global Comparison of Fuel Economy Region Target Target Duration Fleet Fleet Change CAGR year year in years Goal Year 1 Goal Year 2 1 2 under under converted** converted** national laws national laws EU 2015 2021 6 130 g/km 130 g/km 95 g/km 95 g/km -27% -5.1% USA 2016 2025 9 37.8 mp
Slide 38: Convincing Growth Prospects
Convincing Growth Prospects Clear global market leader in Clamp / Connect Excellent growth outlook across EJT market Sales in EUR million (year)* Additional growth for Joining Technology market above 1,017 1000 market growth 800 ca. Fluid Passenger vehicles add. 2- 4% 44% 600 Commercial vehicles add
Slide 39: Premium Pricing through Technology and Innovation Leadership
Premium Pricing through Technology and Innovation Leadership in Mission-Critical Components Mission-criticality: Small relative costs – high impact Basis for premium pricing Market leadership Technology Quality Innovation Tailor-made solutions ca. EUR 224 content per vehicle in total ca. EUR 95 in o
Slide 40: Enhanced Stability through Broad Diversification
Enhanced Stability through Broad Diversification Across Products, End-Markets and Regions Examples of NORMA Group’s key end markets Construction / Engines Commercial vehicles infrastructure / water Passenger vehicles Construction equipment management Wholesalers & technical Agricultural equipment Sh
Slide 41: Good Balance in the Two Distinct Ways-to-Market
Good Balance in the Two Distinct Ways-to-Market Distribution Services (DS) Engineered Joining Technology (EJT) ca. 37% of 2017 sales ca. 63% of 2017 sales High quality, branded and standardized Innovation and product solution partner joining products provided at competitive for customers, focused on
Slide 42: NORMA Group Provides Mission-Critical Products and Solutions
NORMA Group Provides Mission-Critical Products and Solutions with Clear Added-Value A world without NORMA Group Customer impact • Reputation loss • Image loss • Warranty costs • Non-compliance with legal requirements/regulations Loss of end-customers 42
Slide 43: History of Excellence
History of Excellence Acquisition Acquisition 2017 Lifial, Portugal Fengfan, China Acquisition 2016 Autoline Business, France Foundation Acquisition Acquisition National 2014 NORMA China II Five Star, USA Diversified Sales, USA 2011 Acquisition Acquisition Variant, Acquisition Guyco, Foundation MDAX
Slide 44: NDS Provides Full Breadth of Water Management Solutions
NDS Provides Full Breadth of Water Management Solutions Broad diversification in terms of application areas and products Efficient Landscape Stormwater Irrigation Management ca. 27% ca. 55% Flow Management and Others ca. 18% Large target markets for all NDS application areas nationwide and internati
Slide 45: NDS Has Deep and Longstanding Customer Relationships
NDS Has Deep and Longstanding Customer Relationships Highly differentiated distribution and service model • More than 4,300 products • Over 7,500 customer locations (retail and wholesale customers) • Two production sites (CA), six warehouses in the US, more than 500 employees • Overnight shipment fo
Slide 46: Acquisition of the Autoline business from Parker Hannifin
Acquisition of the Autoline business from Parker Hannifin M&A Acquisition of all assets of the Autoline business from Parker Hannifin in November 2016 Business Global supplier of quick connectors for all types of automotive fluid line applications Model Based in Guichen, France, with production site
Slide 47: NORMA Group Worldwide
NORMA Group Worldwide EMEA Czech Republic (P) - Hustopece France (P, D) – Briey, Guichen Germany (P, D) – Maintal, Gerbershausen, Marsberg Italy (D) Netherlands (D) Poland (P, D) - Pilica Portugal (P) - Águeda Russia (P, D) - Togliatti Serbia (P) - Subotica Spain (D) Sweden (P, D) - Anderstorp Switz
Slide 48: Management Board of NORMA Group SE
Management Board of NORMA Group SE Bernd Kleinhens Dr. Michael Schneider • Chief Executive Officer (CEO) of NORMA Group SE • Chief Financial Officer (CFO) of NORMA Group SE since January 1, 2018 since July 2015 Responsibilities: Business Development, Group Com- Responsibilities: Finance, Controlling
Slide 49: Continuation of Growth Track and Sustainable Margin in 2017
Continuation of Growth Track and Sustainable Margin in 2017 Revenue (in EUR million) Gross Profit (in EUR million) of sales 59.9% 61.0% 59.1% 1200 800 54.9% 55.3% 56.0% 55.5% 57.0% 58.4% 58.4% 60% 900 1,017 600 890 895 601 40% 533 546 600 695 400 581 605 636 406 490 344 371 20% 300 458 200 323 251 2
Slide 50: Pro-active Cash Management Continued in 2017
Pro-active Cash Management Continued in 2017 Net Operating Cash Flow (in EUR million) Trade Working Capital (in EUR million) of sales 150 18.5% 18.3% 18.1% 18.3% 18.5% 20% 17.4% 18.1%* 17.1% 16.1% 15.6% 400 100 135 149 133 50 104 109 153 81 200 123 124 67 62 67 108 10% 52 79 90 70 81 0 49 46 115 130
Slide 51: Milestones and Current Shareholder Structure
Milestones and Current Shareholder Structure Milestones and Free Float Changes Identified Institutional Shareholders* Jun 2011 Mar 2013 26% 19% IPO with ca. 100% free 36% free SDAX listing float MDAX listing 6% float 22% 15% 12% Apr 2011 Since Jan 2013 Germany United Kingdom USA Nordic France Rest o
Slide 52: Index-based Share Price Performance compared with MDAX & DAX
Index-based Share Price Performance compared with MDAX & DAX in % 50 30 10 -10 Jan-17 Mar-17 May-17 Jul-17 Sep-17 Nov-17 NOEJ DAX MDAX 52
Slide 53: Contact & Event Calendar
Contact & Event Calendar Event Date Publication Interim Results Q1 2018 May 9, 2018 Annual General Meeting in Frankfurt / Main May 17, 2018 Publication Interim Results Q2 2018 August 1, 2018 Publication Interim Results Q3 2018 November 7, 2018 Contact Andreas Troesch Vice President Investor Relation
Slide 54: Disclaimer
Disclaimer This presentation contains certain future-oriented statements. Future-oriented statements include all statements which do not relate to historical facts and events and contain future-oriented expressions such as ‘believe,’ ‘estimate,’ ‘assume,’ ‘expect,’ ‘forecast,’ ‘intend,’ ‘could’ or ‘