TKH Group N.V. Cert · EURONEXT:TWEKA
TKH Group N.V. Cert — TKH Group — FY2014 Earnings Presentation
56 slides from TKH Group N.V. Cert's earnings presentation, Mar 10, 2015
Slide 1: Annual results 2014
Annual results 2014 TKH Group NV 10 March 2015 1 | Annual results 2014 | 10-03-2015
Slide 2: Content
Content 1 About TKH Group 2 Developments 2014 3 Notes to the results and balance sheet 2014 4 Strategic developments & outlook 5 TKH technologies 6 Defined vertical growth markets 2 | Annual results 2014 | 10-03-2015
Slide 3: About TKH Group
ABOUT TKH GROUP 3 | Annual results 2014 | 10-03-2015
Slide 4: Profile
Profile Turnover € 1.35 billion Geographical Number of employees (FTE) 5,030 distribution of turnover (in %) Technology company Four core technologies Vision & security, communication, connectivity and manufacturing systems The core technologies are combined with software and system integration into
Slide 5: Mission
Mission TKH intends to be an innovative and leading technology (niche) player in creating combinations of technologies to total solutions through which customers are fully relieved and that lead to larger efficiency, more comfort and larger safety. TKH aims to be an attractive employer, to continuou
Slide 6: Strategy TKH
Strategy TKH Value creation Focus on 4 core technologies in 3 business segments Telecom Building Industrial Solutions Solutions Solutions Growth drivers Communication, safety, care and efficiency Innovations > 15% turnover 6 | Annual results 2014 | 10-03-2015
Slide 7: Developments 2004 - 2014
Developments 2004 - 2014 1) 1) excluding one-off income and expenses 7 | Annual results 2014 | 10-03-2015
Slide 8: Developments 2014
DEVELOPMENTS 2014 8 | Annual results 2014 | 10-03-2015
Slide 9: Highlights 4th quarter 2014
Highlights 4th quarter 2014 Turnover up 16.0% at € 353.1 million, almost entirely organic Continuation of success Industrial Solutions Good results Building Solutions Successful € 75 million share issue to finance further strategic growth Acquisition of Commend group, effective as from January 2015
Slide 10: Highlights 2014
Highlights 2014 Turnover up 12.7% at € 1.35 billion, particularly large increase at Industrial Solutions Order intake in tyre manufacturing segment at record level of almost € 400 million, higher order intake at Building Solutions Merger squeeze-out Augusta Technologie AG in completion stage Increas
Slide 11: Acquisitions
Acquisitions Commend-group – Building Solutions – vision & security systems Worldwide market leader and leading technology company in mission critical intercom systems TKH acquires: 74%-interest in Commend International GmbH, Salzburg (Austria) . 100%-interest in sales organisations in the USA, UK,
Slide 12: Acquisitions
Acquisitions Merger squeeze-out Augusta Technologie AG in completion stage End of 2014 TKH holds 91,2% interest Approval merger squeeze-out by Augusta’s shareholders meeting on 19 January 2015 The amount in cash offered for compensation to the minority shareholders of Augusta has been set at € 31.15
Slide 13: Highlights 2014 - Solutions segmentation
Highlights 2014 Solutions segmentation 13 | Annual results 2014 | 10-03-2015
Slide 14: Telecom Solutions
Telecom Solutions (in million € unless stated otherwise) 2014 2013 Δ in % Turnover 165.3 156.8 + 5.4 EBITA 14.4 14.1 + 2.0 ROS 8.7% 9.0% 1) Before one-off expenses of € 0.5 million in 2013 Organic turnover growth: + 5,4% Strong decline turnover copper network systems due to priority investments in o
Slide 15: Telecom Solutions
Telecom Solutions Segment fibre networks systems: turnover +10.1% Optical fibre (cable), connectivity systems and components, active equipment Increase investments in Europe as telecom operators completed 4G network investments Acquisition of strategic optical fibre projects Poland, Germany and Fran
Slide 16: Telecom Solutions
Telecom Solutions Segment indoor telecom systems: turnover +14.8% Home networking systems, broadband connectivity, IPTV-software solutions Increase in projects to upgrade broadband connections in the Benelux region Higher demand for broadband capacity in homes – replacement demand for broadband conn
Slide 17: Building Solutions
Building Solutions (in million € unless stated otherwise) 2014 2013 Δ in % Turnover 502.1 490.0 + 2.5 EBITA 43.1 39.4 + 9.4 ROS 8.6% 8.0% 1) Before one-off expenses of € 6.6 million in 2013 Organic turnover growth: + 2.2% due to focus on vertical growth markets and continued internationalisation Ord
Slide 18: Building Solutions
Building Solutions Segment building technologies: turnover +4.0% Energy-saving lighting and light switch systems, energy management systems, care systems, structured cabling systems Positive developments invertical growth markets parking and tunnels & infra Key projects won for parking systems in Au
Slide 19: Building Solutions
Building Solutions Segment vision & security systems: turnover +8.3% Vision technology, systems for CCTV, video/audio-analysis and detection, intercom, access controls and registration, central control room integration Turnover rose 15.3% in Q4 due to focus on vertical growth markets Innovations and
Slide 20: Building Solutions
Building Solutions Segment connectivity systems: turnover -6.4% Specialty cable, connectivity systems and components for shipping, railways, wind energy as well as installation and energy cable for niche markets Impact raw material prices on turnover: -2.5% Challenging market conditions in building
Slide 21: Industrial Solutions
Industrial Solutions (in million € unless stated otherwise) 2014 2013 Δ in % Turnover 683.0 551.0 + 23.9 EBITA 91.6 58.5 + 56.7 ROS 13.4% 10.6% Organic turnover growth: +24.6% – strong growth in Asia Substantial increase in EBITA due to higher turnover, improved efficiency and better distribution of
Slide 22: Industrial Solutions
Industrial Solutions Segment connectivity systems: turnover +0.2% Specialty cable systems and modules for the medical, robotic, automotive and machine building industry Impact raw material prices on turnover: -1.4% – organic growth 1.6% Uncertain economic climate in Europe – certain reluctance to in
Slide 23: Industrial Solutions
Industrial Solutions Segment manufacturing systems: turnover +42.4% Tyre manufacturing systems, can washers, machine control systems, product handling systems and test equipment Hiring additional capacity in the Netherlands and China – solid cost controls and high efficiency level – margin improveme
Slide 24: Notes to the results and balance sheet 2014
NOTES TO THE RESULTS AND BALANCE SHEET 2014 24 | Annual results 2014 | 10-03-2015
Slide 25: Notes to the results 2014: change in turnover
Notes to the results 2014 Change in turnover (in € million) 25 | Annual results 2014 | 10-03-2015
Slide 26: Notes to the results 2014: geographical distribution of turnover
Notes to the results 2014 Geographical distribution of turnover (in %) 26 | Annual results 2014 | 10-03-2015
Slide 27: Notes to the results 2014: turnover per solution
Notes to the results 2014 Development of turnover per solution 1) (in million € unless stated otherwise) Impact Impact Turnover Turnover Total prices raw acqui- Organic 2014 2013 growth materials sitions growth Telecom Solutions 165.3 156.8 + 5.4% - - + 5.4% Building Solutions 502.1 490.0 + 2.5% - 0
Slide 28: Notes to the results 2014
Notes to the results 2014 Gross margin increased to 42.6% (2013: 41.7%) Margin improvement in Building and Industrial Solutions Improved product mix Lower gross margin in Telecom Solutions due to overcapacity and investments in expansion of strategic position in Poland, Germany and France Increase E
Slide 29: Notes to the results 2014: EBITA per Solution
Notes to the results 2014 EBITA per Solution 1) (in million € unless stated otherwise) 2014 2013 EBITA ROS % EBITA ROS % Telecom Solutions 14.4 8.7 14.1 9.0 Building Solutions 43.1 8.6 39.4 8.0 Industrial Solutions 91.6 13.4 58.5 10.6 Other - 14.0 - 12.2 Total 135.1 10.0 99.8 8.3 1) Excluding one-of
Slide 30: Notes to the results 2014
Notes to the results 2014 Increase amortisation charges with € 1.1 million Higher investments in research & development One-off income and expenses of € +8.8 million (2013: € -7.3 million) Defined benefit gain of € 9.4 million due to change in pension plans Impairment on goodwill and R&D, which is m
Slide 31: Notes to the results 2014: change in financial result
Notes to the results 2014 Change in financial result (in € million) Decrease financial expenses with € 4.8 million Lower interest expenses following renewal of credit facility as per October 2013 One-off amortisation of capitalised finance costs in 2013 Lower interest rate due to expiration of inter
Slide 32: Notes to the results 2014
Notes to the results 2014 (in million €) 2014 2013 Δ in % Turnover 1) 1,350.4 1,197.8 + 12.7 Costs of raw materials / consumables - 774.8 - 698.7 Gross margin 575.6 42,6% 499.1 41,7% + 15.3 Operating costs - 440.5 - 399.3 + 10.3 EBITA 135.1 10,0% 99.8 8,3% + 35.4 Amortisation - 26.1 - 25.1 One-off i
Slide 33: Balance sheet as of December 2014
Balance sheet as of 31 December 2014 (in million €) 31-12-2014 31-12-2013 Assets Non-current assets 592.7 578.1 Inventories 202.3 185.5 Construction contracts 115.3 78.3 Receivables 172.5 155.8 Cash 90.3 79.6 Assets held for sale 3.1 - Total 1,176.2 1,077.3 Liabilities Equity 510.8 377.6 Non-control
Slide 34: Notes to the balance sheet: change in working capital
Notes to the balance sheet 31 December 2014 Change in working capital (in € million) Working capital Use of non-recourse factoring: 31-12-14 € 41.2 million 31-12-13 € 38.8 million Use of supply chain finance: 31-12-14 € 13.6 million 31-12-13 € 16.6 million 34 | Annual results 2014 | 10-03-2015
Slide 35: Notes to the balance sheet: change in net debt
Notes to the balance sheet 31 December 2014 Change in net debt (in € million) Financial covenants Net debt is based on financial covenants as agreed with banks Net debt / EBITDA: 1.0 Interest coverage ratio: 18.9 1) Including net debt/(cash) received from acquisitions 35 | Annual results 2014 | 10-0
Slide 36: Cash flow statement
Cash flow statement (in million €) 2014 2013 Operating result 117.8 67.5 Depreciation, amortisation and impairment 46.7 45.1 Result on divestments - - 0.5 Share and option schemes 1.8 2.0 Change in provisions - 8.6 4.1 Change in working capital - 40.8 - 8.7 Cash flow from operations 116.9 109.5 Inte
Slide 37: Ratios
Ratios 2014 2013 Working capital / Turnover 1) 13.8% 13.2% Net debt / EBITDA 2) 1.0 1.5 Gearing (net debt / equity) 3) 36.2% 45.6% ICR (EBITDA / Financial cost) 2) 18.9 10.9 Solvency 44.9% 40.7% Earnings per ordinary share before amortisation and one-off income and expenses 4) € 2.23 € 1.48 Earnings
Slide 38: Strategic developments & outlook
Strategic developments & outlook 38 | Annual results 2014 | 10-03-2015
Slide 39: Business drivers
Business drivers Focus on four core technologies Vision & security, communication, connectivity and manufacturing systems Merge the four core technologies into specific solutions for identified niche vertical markets with special focus on high growth opportunities within the business segments Teleco
Slide 40: TKH – vertical growth markets – growth drivers
TKH – vertical growth markets – growth drivers Advantage of focus on defined vertical growth markets Focus leads to maximum traction to realise growth potential Choice for growth verticals is determined on the return potential based on internal and external benchmarking – ROS and ROCE in combination
Slide 41: Financial objectives TKH
Financial objectives TKH Progress realisation targets on track Increase ROS in 2014 to 10.0% (2013: 8.3%) ROCE in 2014: 20.3% (2013: 15.9%) Focus on 7 vertical growth markets – turnover target for growth in 3 - 5 years of € 300 - € 500 million accelerates realisation of targets Targets ROS target: 1
Slide 42: Growth scenarios vertical growth markets
Growth scenarios vertical growth markets Growth verticals (in € millions) 2012 2014 Growth scenarios Fibre optics network 80.0 98.0 120.0 150.0 Parking 20.0 34.8 75.0 100.0 Tunnel & infra 30.0 25.5 100.0 150.0 Marine, oil & gass 20.0 50.1 100.0 125.0 Care 30.0 35.1 70.0 100.0 Machine vision 95.0 102
Slide 43: Outlook
Outlook Signs of a cautious recovery in global economic conditions Uncertain economic developments due to unstable geopolitical situation and monetary situation TKH’s core technologies well positioned to continue growth – expectation turnover to grow by € 300 to € 500 million in the next 3 - 5 years
Slide 44: Outlook
Outlook Building Solutions Conditions in building and construction sector in the Benelux remain challenging – lack of recovery in this sector Vertical growth markets, primarily linked to vision and security technology, are promising to assume growth Industrial Solutions In last few months slight rel
Slide 45: TKH technologies
TKH TECHNOLOGIES 45 | Annual results 2014 | 10-03-2015
Slide 46: Core technologies
Core technologies Vision & Security Communication Emergency Personal alarm systems systems Manufacturing systems Connectivity 46 | Annual Drag results 2014 | 10-03-2015 Chain systems MultiMediaConnect
Slide 47: Vertical growth markets
VERTICAL GROWTH MARKETS 47 | Annual results 2014 | 10-03-2015
Slide 48: Business drivers
Business drivers TKH focuses on distinguishing potential for an above- average performance Niche player strategy - focus on high quality solutions with high margins High pricing power by innovative unique solutions Attractive margins because of high yield on investments for customers Commodity produ
Slide 49: TKH – vertical growth markets – Fibre Optic
TKH – vertical growth markets – Fibre Optic Growth drivers High priority from telecom-operators for upgrading networks Successful FttH-projects proof high return on investment Telecom operators are able to gain or defend market share through fibre optic technology More and more parties request of to
Slide 50: TKH – vertical growth markets – Parking
TKH – vertical growth markets – Parking Growth drivers Strong need within parking industry to: decrease OPEX – increase occupancy car parks – increase revenues by differentiated parking rates – increase comfort and ease for parker High returns on technology investments TKH has distinctive advanced t
Slide 51: TKH – vertical growth markets – Tunnel & Infra
TKH – vertical growth markets – Tunnel & Infra Growth drivers New legislation for tunnel technology – caused by fire Mont Blanc-tunnel In Europe, before 2020, thousands of kilometres tunnels will be built and provided with new tunnel technology for replacement Technologies relevant in relation to ne
Slide 52: TKH – vertical growth markets – Marine, Oil & Gas
TKH – vertical growth markets – Marine, Oil & Gas Growth drivers Strong growing market from the perspective of the TKH core technologies that respond to the increasing need to a safer environment by a good detection and analysis of risk with quick and direct communication and guiding of actions in c
Slide 53: TKH – vertical growth markets – Care
TKH – vertical growth markets – Care Growth drivers Large need for care systems that respond to live longer independently at home: increasing aging – necessary cost reductions – efficiency improvements – need for better care – scarcity of nursing staff TKH core technologies respond well to the trend
Slide 54: TKH – vertical growth markets – Machine vision
TKH – vertical growth markets – Machine vision Growth drivers Extensive industrial automation and robotising responds to high productivity and quality of manufactured products Vision-technology is a superior alternative for steering and control of manufacturing systems and for the human eye in the a
Slide 55: TKH – vertical growth markets – Tyre building
TKH – vertical growth markets – Tyre building Growth drivers High priority in tyre building industry for replacement existing technology with drivers: high productivity – less waste – improved quality – smaller batches – more regional production Advanced TKH-technology responds to these drivers – pe
Slide 56: 56 | Annual results 2014 | 10-03-2015
56 | Annual results 2014 | 10-03-2015