Kitron Asa · OSL:KIT
Kitron Asa — Q2 2014 Earnings Presentation
18 slides from Kitron Asa's earnings presentation, Jul 22, 2014
Slide 1: Q2 results 2014
Q2 results 2014 July 22 2014 Dag Songedal, Interim CEO Cathrin Nylander, CFO
Slide 2: Strong order intake, profitability still challenging
Financial highlights for Q2: Strong order intake, profitability still challenging • Strong order intake NOK mill. Q2 2014 vs Q2 2013 • Defence sector is strengthened • Revenue growth Revenue 457,1 6,2 % • Continued growth from last year and last quarter EBIT 6,9 -26,1 % • Margin pressure Order b
Slide 3: Major new orders: Defence sector order
Major new orders: Defence sector order • Order from Kongsberg Defence & Aerospace • The order has a value for Kitron of NOK 80.7 million, and will be fulfilled in 2014 and 2015. • Military communications equipment for the order KONGSBERG has signed with Raytheon for NASAMS Air-defence system to Oman
Slide 4: Arendal downsizing
Operational information: Arendal downsizing • Going according to plan • The current plans implies a reduction of 85 in the number of employees during 2014. At the end of June, 40 of these have already left the company. Only parts of the initiated actions had a cost effect in the second quarter • Dur
Slide 5: New CEO
Additional information: New CEO • Peter Nilsson appointed permanent CEO • He will take up his position in November 2014 at the latest. • Peter Nilsson has held several senior and executive leadership positions for Swedish an US companies: • PartnerTech, Rimaster, Sanmina, and Ericsson, latest as Pre
Slide 6: Financial statements Q2 2014
Financial statements Q2 2014
Slide 7: Strong development in Energy/Telecoms, Offshore/Marine reductions
Revenue: Strong development in Energy/Telecoms, Offshore/Marine reductions Q2 2014 vs Q2 2013 Share of total revenue Offshore/Marine -10,8 % 15,0 % Medical equipment 7,1 % 24,1 % Defence/Aerospace -4,1 % 20,0 % Energy/Telecoms 36,7 % 15,2 % Industry 12,5 % 25,8 %
Slide 8: Strong growth in Lithuania and China
Revenue by country*: Strong growth in Lithuania and China Q2 2014 vs Q2 2013 Share of total revenue Norway -9,9 % 44,2 % Sweden 14,9 % 22,0 % Lithuania 39,2 % 22,2 % Others 32,8 % 11,6 % * Before group entities and eliminations
Slide 9: EBIT: Reduction in EBIT
EBIT: Reduction in EBIT • Profitability reduction 9,3 • Arendal profitability disappointing 7,6 partially compensated by a positive development in especially Lithuania and China. 4,3 • Margin pressure, both on existing and new customers, continues 6,9 2,0 NOK million • Cost reduction measures - 25.6
Slide 10: EBIT by country: Norway disappointing, others positive
EBIT by country: Norway disappointing, others positive • Norway EBIT* 8,5 • Revenue reduced NOK million 6,3 • Adverse effects on profitability due to 5,6 development of the Norwegian krone 2,7 2,3 2,1 • Projects with negative effects and temporary production ineffctivity • Sweden -1,7 • Revenue grow
Slide 11: Balance sheet: Weak cash flow
Balance sheet: Operating cash flow Weak cash flow 54,4 NOK million 30,3 • Cash flow - 68.6 % 9,5 • Working capital increase due to -17,4 increased sales -36,8 • Lower profitability Net working capital • Working capital increase NOK million 522 • Accounts receivable increase of 505 MNOK 58 498 • Inve
Slide 12: Market development
4 Kitron Market development www. kitron.com
Slide 13: Order backlog: Strong development in Defence
Order backlog: Strong development in Defence Order backlog • Defence increase NOK million • MNOK 99 compared to last year • MNOK 148 in the quarter • Norway and US • Energy/Telecom and Medical, Industry show growth 847 859 746 • Offshore Marine reductions 718 707 • All sites have higher order backlo
Slide 14: Market development: Offshore/Marine, Medical equipment
Market development • Offshore/Marine • Decline in the Norwegian market • Medical equipment • Positive development in the Swedish market with growth from existing customers • Stable development in Norway
Slide 15: Market development: Defence/Aerospace, Energy/Telecoms, Industry
Market development • Defence/Aerospace • Strong growth in order backlog compared to last year in all our markets • Growth in second quarter • Energy/Telecoms • Strong second quarter due to project deliveries • Demand slightly above previous levels • Industry • Industry growth is levelling out, simil
Slide 16: Outlook
Outlook
Slide 17: Outlook
Outlook • Kitron expects a positive development in the Swedish and German markets, with growth for the factories in Sweden and Lithuania. • Growth is also expected in China and the US, whereas a lower volume is expected in the Norwegian operation. • Kitron expects growth in revenue in 2014, partly e
Slide 18: Thank you!
Thank you!