Huber + Suhner Ag · SIX:HUBN
Huber + Suhner — H1 2019 Earnings Presentation
35 slides from Huber + Suhner's earnings presentation, Aug 20, 2019
Slide 1: Excellence in Connectivity Solutions
Excellence in Connectivity Solutions
Slide 2: Half-year conference 2019
Half-year conference 2019 20 August 2019 | Media and analysts conference
Slide 3: Agenda
Agenda Overview 1st half-year 2019 Urs Ryffel (CEO) Financial results Ivo Wechsler (CFO) Outlook 2019 Urs Ryffel (CEO) Questions Buffet lunch 20 August 2019 | Media and analysts conference
Slide 4: Good first half-year 2019
Overview 1st half-year 2019 Good first half-year 2019 Increase in earning power due to growth with high-margin business Net sales 5.6 % behind strong previous-year period • Radio Frequency increases again; Fiber Optics with a significant and Low Frequency with a slight decline • Main markets: strong
Slide 5: Figures at a glance
Overview 1st half-year 2019 Figures at a glance CHF million H1/19 H1/18 Δ% Order intake 448.7 516.8 -13.2 Net sales 447.3 474.0 -5.6 Operating profit (EBIT) 47.8 44.3 +7.8 • as % of net sales 10.7 9.4 Net income 37.4 31.6 +18.2 • as % of net sales 8.4 6.7 Excellence in Connectivity Solutions 20 Augu
Slide 6: Net sales development technology segments
Overview 1st half-year 2019 Net sales development technology segments Radio Frequency with positive development, Fiber Optics and Low Frequency with decline CHF million 250 200 190.1 157.5 153.2 147.8 150 142.0 130.7 100 H1/2018 50 H1/2019 0 Radio Frequency Fiber Optics Low Frequency Excellence in C
Slide 7: Technology segment Radio Frequency
Overview 1st half-year 2019 Technology segment Radio Frequency Double-digit growth and further significant increase in profitability CHF million Key aspects H1/19 H1/18 Δ% • Strong position in the manufacture of extremely reliable radio frequency components for a wide range of industrial Order intak
Slide 8: Technology segment Fiber Optics
Overview 1st half-year 2019 Technology segment Fiber Optics Continued upturn in profitability despite lower net sales CHF million Key aspects H1/19 H1/18 Δ% • Lower year-on-year volumes from infrastructure projects for the expansion of mobile communication networks to the 4G / Order intake 150.3 203
Slide 9: Technology segment Low Frequency
Overview 1st half-year 2019 Technology segment Low Frequency Net sales at lower level although growth opportunities still intact CHF million Key aspects H1/19 H1/18 Δ% • Railway: down year on year; the many project tenders indicate a continued good trend • Automotive: positive development; continuin
Slide 10: Net sales by market
Overview 1st half-year 2019 Net sales by market Strong growth in Industrial; decline in Communication and Transportation CHF million 250 200 -19% 30% 150 -9% +28% 41% H1/2019 100 50 Communication H1/2018 Transportation 29% H1/2019 Industrial 0 Communication Transportation Industrial Excellence in Co
Slide 11: Net sales by regions
Overview 1st half-year 2019 Net sales by regions Shift in net sales share in the main regions CHF million 250 +9% 200 21% 150 -26% 48% H1/2019 100 +4% 50 31% EMEA (incl. CH) H1/2018 Asia-Pacific H1/2019 Americas 0 EMEA Asia-Pacific Americas (incl. CH) Excellence in Connectivity Solutions 20 August 2
Slide 12: Selected milestones 1st half year 2019
Overview 1st half-year 2019 Selected milestones 1st half year 2019 Communication – Industrial – Opportunity with Connected mobility Offshore market segment Acquisition of Kathrein’s antenna Development of a RADOX ® portfolios for railway, bus and product line for extreme security-relevant communicat
Slide 13: Agenda
Agenda Overview 1st half-year 2019 Urs Ryffel (CEO) Financial results Ivo Wechsler (CFO) Outlook 2019 Urs Ryffel (CEO) Questions Buffet lunch 20 August 2019 | Media and analysts conference
Slide 14: Factors impacting order intake
Financial results Factors impacting order intake CHF million 550 -59.2 million -8.9 million -68.1 million -11.5% -1.7% -13.2% 500 450 400 350 517 458 449 449 300 Order intake H1/2018 Organic Currency + copper Order intake H1/2019 Excellence in Connectivity Solutions 20 August 2019 | Media and analys
Slide 15: Factors impacting net sales
Financial results Factors impacting net sales CHF million 500 -18.3 million -8.3 million -26.6 million -3.9% -1.8% -5.6% 450 400 350 474 456 447 447 300 Net sales H1/2018 Organic Currency + copper Net sales H1/2019 Excellence in Connectivity Solutions 20 August 2019 | Media and analysts conference 1
Slide 16: Net sales development technology segments
Financial results Net sales development technology segments +13.1% -17.1% -7.3% reported CHF million +14.4% -16.1% -4.2% organic 200 190.1 157.5 153.2 147.8 150 142.0 130.7 100 50 0 Radio Frequency Fiber Optics Low Frequency H1/2018 H1/2019 Excellence in Connectivity Solutions 20 August 2019 | Media
Slide 17: Gross margin
Financial results Gross margin Greatly improved business mix CHF million 180 40% 37.2% 170 35.7% 160 33.6% 35% 150 140 30% 167 130 159 147 120 25% Gross profit 110 Gross margin 100 20% H1/18 H2/18 H1/19 Excellence in Connectivity Solutions 20 August 2019 | Media and analysts conference 17
Slide 18: Operating expenses
Financial results Operating expenses Higher F+E expenses in H1 / semester comparison CHF million 150 30% 26.6% 27.0% 24.6% 100 20% 50 10% Operating expenses 117 109 121 in % of net sales 0 0% H1/18 H2/18 H1/19 Excellence in Connectivity Solutions 20 August 2019 | Media and analysts conference 18
Slide 19: Factors influencing EBIT
Financial results Factors influencing EBIT CHF million EBIT margin +6.8 million -2.2 million -1.1 million +3.5 million 9.4% ► 10.7% 60 +15.3% -5.0% -2.5% +7.8% 50 40 30 20 10 44.3 44.3 48.9 47.8 47.8 0 EBIT H1/18 Organic Currency + copper One-off effects EBIT H1/19 Excellence in Connectivity Solutio
Slide 20: EBIT technology segments
Financial results EBIT technology segments CHF million H1/19 in % H1/18 in % Radio Frequency 27.0 18.3 19.9 15.2 Fiber Optics 12.3 7.8 12.1 6.4 Low Frequency 12.6 8.8 15.4 10.1 Corporate (4.1) (3.2) Total EBIT 47.8 10.7 44.3 9.4 Excellence in Connectivity Solutions 20 August 2019 | Media and analyst
Slide 21: Currency development during the first half year of 2019
Financial results Currency development during the first half year of 2019 Development vs CHF 31.12.18 vs Ø H1/18 vs BRL INR PLN GBP USD EUR RMB AUD 30.06.19 Ø H1/19 108% 106% 104% BRL 1.2% -7.9% INR 0.2% -2.4% 102% BRL PLN -0.7% -4.5% INR GBP -1.0% -2.4% 100% PLN USD -1.3% 3.4% GBP USD EUR -1.5% -3.
Slide 22: Financial result
Financial results Financial result Less negative currency effects CHF million 3 2 (2.4) (0.6) 1 0.1 0 (0.4) (0.2) -1 (2.5) Net currency effects -2 Other financial result H1/2018 H1/2019 -3 Excellence in Connectivity Solutions 20 August 2019 | Media and analysts conference 22
Slide 23: Group tax rate
Financial results Group tax rate Higher share of profits in countries with lower tax rates 30% 25.1% 24.6% 25% 21.9% 20.8% 20% 15% 10% 5% Expected tax rate Effective tax rate 0% H1/18 H1/19 Excellence in Connectivity Solutions 20 August 2019 | Media and analysts conference 23
Slide 24: Factors influencing net income
Financial results Factors influencing net income CHF million 50 +3.5 Mio. +1.8 Mio. +0.5 Mio. +5.8 Mio. +10.9% +5.6% +1.7% +18.2% EPS 40 1.62 1.92 (+18%) 30 20 10 31.6 31.6 35.1 36.9 37.4 0 Net income H1/18 EBIT impact Financial result Income tax Net income H1/19 Excellence in Connectivity Solutio
Slide 25: Investments
Financial results Investments Rising volume CHF million 25 4% 3.5% 3.3% 20 3% 2.4% 15 2% 10 1% 5 Investments 11.4 15.6 15.5 in % of net sales 0 0% H1/18 H2/18 H1/19 Excellence in Connectivity Solutions 20 August 2019 | Media and analysts conference 25
Slide 26: Balance sheet
Financial results Balance sheet Unchanged strong CHF million 30.06.2019 31.12.2018 ▲ 30.06.2018 Cash and cash equivalent 167 199 -16% 151 Other current assets 373 332 12% 376 Non-current assets 237 239 -1% 245 Liabilities 172 149 15% 173 Equity 605 621 -3% 599 in % 78% 81% 78% Balance sheet total 77
Slide 27: Overview free cash flow
Financial results Overview free cash flow Again high cash flow from operating activities CHF million H1/19 H1/18 Cash flow from operating activities 33.9 34.8 Cash flow from investing activities (15.8) (13.2) Free operating cash flow 18.1 21.5 Dividend payment (48.7) (21.4) Change in treasury shares
Slide 28: Financial assessment H1/2019
Financial assessment H1/2019 ⚡ Absolute decline in order intake (-13.2%) and net sales (-5.6%) Strong growth in the high-margin industrial market (+ 28%) Double-digit operating profitability (10.7%) Lower tax rate (20.8%) Excellence in Connectivity Solutions 20 August 2019 | Media and analysts
Slide 29: Agenda
Agenda Overview 1st half-year 2019 Urs Ryffel (CEO) Financial results Ivo Wechsler (CFO) Outlook 2019 Urs Ryffel (CEO) Questions Buffet lunch 20 August 2019 | Media and analysts conference
Slide 30: Conclusion 1st half-year 2019
Outlook 2019 Conclusion 1st half-year 2019 Good first half year compared to strong previous-year period • Increase in earning power due to optimization of business mix with high-margin business • Communication: lower volumes from large-scale 4G project in India leads to significantly lower net sales
Slide 31: Technology segments
Outlook 2019 see FY conference 19.3.2019 Technology segments Confirmation of strategic orientation Radio Frequency • Goal 2019: defend previous year’s strong margin and confirm growth path. • Strategic direction: increase market share in high-margin applications; grow stronger than the market in a
Slide 32: Markets
Outlook 2019 Markets Flattening momentum – opportunities with growth initiatives Overall • Pressure on top and bottom line of export-oriented Swiss companies from Swiss franc appreciation. • Increasing uncertainty in the markets due to US-CN trade conflict; Brexit, etc. slowing down investment activ
Slide 33: Outlook 2019
Outlook 2019 Outlook 2019 Net sales guidance for 2019 • Rather restrained development expected for second half-year of 2019, also due to the negative currency development. • Shortfall in net sales from today’s perspective for 2019 in mid-single-digit percentage year-on- year. EBIT guidance for 2019
Slide 34: Agenda
Agenda Overview 1st half-year 2019 Urs Ryffel (CEO) Financial results Ivo Wechsler (CFO) Outlook 2019 Urs Ryffel (CEO) Questions Buffet lunch 20 August 2019 | Media and analysts conference
Slide 35: Agenda
Agenda Overview 1st half-year 2019 Urs Ryffel (CEO) Financial results Ivo Wechsler (CFO) Outlook 2019 Urs Ryffel (CEO) Questions Buffet lunch 20 August 2019 | Media and analysts conference