Tarkett Sa · SWB:1T9
Tarkett Sa — Q1 2017 Earnings Presentation
29 slides from Tarkett Sa's earnings presentation, Apr 26, 2017
Slide 1: Q1 2017 Financial Results
Q1 2017 FINANCIAL RESULTS April 26, 2017
Slide 2: Disclaimer
Disclaimer This document may contain estimates and/or forward-looking statements. Such statements do not constitute forecasts regarding Tarkett’s results or any other performance indicator, but rather trends or targets, as the case may be. These statements are by their nature subject to risks and un
Slide 3: Agenda
> Q1 2017 Key Highlights AGENDA > Q1 2017 Activity > Key Initiatives > Conclusion > Appendices
Slide 4: Q1 2017 Key Highlights
Q1 2017 KEY HIGHLIGHTS Michel Giannuzzi CEO
Slide 5: Good start to the year: Q1 2017 Highlights
Good start to the year: Q1 2017 Highlights > Net sales up 6.1% year-on-year at €612m, including organic growth of 2.8%(1) > Robust organic growth in EMEA (up 7.0%)(1) and a good start to the year for the Sports (up 3.6%)(1) and CIS, APAC and Latin America (up 2.0%)(1) segments > North America penali
Slide 6: Balanced exposures providing resilience to industry cycles
Tarkett benefits from balanced exposures providing resilience to industry cycles BALANCED GEOGRAPHIC ONE OF THE BROADEST PRODUCT ATTRACTIVE END-MARKETS EXPOSURE PORTFOLIOS IN THE FLOORING INDUSTRY EXPOSURE Sales in more than 100 countries Sports NORTH AMERICA incl. Sports EMEA incl. Sports 17% Vinyl
Slide 7: Q1 2017 Activity
Q1 2017 ACTIVITY Raphaël Bauer CFO
Slide 8: Reported sales were up 6.1% compared to Q1 2016
Reported sales were up 6.1% compared to Q1 2016 in €m > Excellent performance in EMEA > CIS, APAC & Latam 12.8 612 started the year well 6.4 16.2 1.9 593 2.0 > Good momentum in 576 (3.9) Sports > North America penalized Organic growth by a high comparison of 2.8% basis > Positive impact from selling
Slide 9: Adjusted EBITDA was 14.6% higher in Q1 2017
Adjusted EBITDA(1) was 14.6% higher in Q1 2017 in €m 7.9 1.2 51.5 6.0 > Strong result from our (3.5) 45.0 (1.4) productivity action plans (2.4) (1.3) > Positive selling price lag effect in CIS despite selective promotions > Increase in raw material purchase pricing Q1 2016 Currencies Selling price V
Slide 10: EMEA Q1 2017
EMEA Q1 2017 NET SALES in €m Q1 2017 +7.0% +4.7% 243 > Vigorous growth in Nordic reported Net sales countries 232 organic growth(1) > Upbeat Germany > France confirmed the recovery begun in Q4 2016 Q1 2016 Q1 2017 > The UK performed well after a slowdown in H2 2016 > Good growth in Southern Europe (
Slide 11: North America Q1 2017
North America Q1 2017 NET SALES in €m Q1 2017 +1.6% reported 190 Net sales organic growth(1) -2.1% > High comparison basis as 187 Q1 2016 had been boosted by: • large-scale projects and Q1 2016 Q1 2017 • stockbuilding by a new customer > Robust growth in LVT > Reported sales spurred by gains in the
Slide 12: CIS, APAC & Latam Q1 2017
CIS, APAC & Latam Q1 2017 NET SALES in €m Q1 2017 +17.2% reported 121 Net sales organic growth(1) +2.0% CIS countries > In line with Q4 2016, ongoing 104 improvement > Selective promotions strategy (as in December 2016) Q1 2016 Q1 2017 > Product mix improvement APAC > Good dynamics Latin America > F
Slide 13: Russia: Selective promotion strategy to adapt to exchange rate
Russia: Selective promotion strategy to adapt to the exchange rate evolution Evolution of Tarkett Vinyl prices in Russia and EUR/RUB exchange rate 60% 50% Rate and price change, % 40% 30% 20% 10% 0% Dec'13 Jul'14 Jan'15 Jul'15 Jan'16 Jul'16 Jan'17 RUB devaluation (inverted scale) 2/3 of Devaluation
Slide 14: Sports Q1 2017
Sports Q1 2017 NET SALES in €m Q1 2017 53 +6.6% reported 57 Net sales organic growth(1) +3.6% > Good momentum in particular strong development in tracks > Structurally small quarter for the segment due to seasonality Q1 2016 Q1 2017 > Several high-profile projects awarded • Banked hydraulic tracks a
Slide 15: Key Initiatives
KEY INITIATIVES Michel Giannuzzi CEO
Slide 16: Deliver outstanding customer experience in Stores & Shops
Deliver outstanding customer experience in Stores & Shops Design and Innovative Solutions Partner > iD Mixonomi, 33 Colours innovative modular Infinite combinations 10 shapes vinyl solutions (LVT) > Provide a creative design mixing colours and shapes with infinite combination possibilities > Offer c
Slide 17: Deliver outstanding customer experience in Stores & Shops
Deliver outstanding customer experience in Stores & Shops Design and Innovative Solutions Partner > Red Dot Award - Product Design 2017 for iD Mixonomi > The most famous international design Award > Among 5,500 products and innovations from 54 countries > Reinventing the Tradeshow experience at Euro
Slide 18: Conclusion
CONCLUSION Michel Giannuzzi CEO
Slide 19: Q1 2017 Key Take-aways
Q1 2017 Key Take-aways > Good start to the year: > Excellent performance in EMEA > Good momentum in Sports Take-aways > CIS, APAC & Latam started well > North America penalized by a high comparison basis > Adjusted EBITDA up 14.6% > EMEA, North America and Sports should remain healthy over the year
Slide 20: Q&A Session
Q&A SESSION
Slide 21: Appendix
APPENDIX
Slide 22: Sales and adjusted EBITDA performance in Q1
Sales and adjusted EBITDA performance in Q1 Sales performance by quarter Organic €m Q1 2017 Q1 2016 % growth growth1 EMEA 243.4 232.4 +4.7% +7.0% North America 190.3 187.2 +1.6% -2.1% CIS, APAC & LATAM 121.3 103.5 +17.2% +2.0% Sports 56.7 53.2 +6.6% +3.6% TOTAL 611.7 576.3 +6.1% +2.8% Q1 2017 Q1 201
Slide 23: Long term profitable growth
Long term profitable growth NET SALES ADJUSTED EBITDA(1) in €m in €m 334 2,739 310 2,715 285 2,516 275 2,414 262 2,292 2,088 222 1,919 208 1,708 191 12.2% 11.6% 11.4% 12.3% 11.4% 10.5% 12.2% 9.1% 2009 2010 2011 2012 2013 2014 2015 2016 2009 2010 2011 2012 2013 2014 2015 2016 +7.0% CAGR 2009-2016 +7.
Slide 24: 2017-2020 financial objectives
2017-2020 financial objectives Unless transforming acquisition Revenue growth > 2020 net sales ~€3.5bn(1) > Adjusted EBITDA margin > 12% Profitability & return > ROIC > 9% Acquisitions strategy > Additional sales by 2020 of ~€500m Leverage > Net debt / adjusted EBITDA < 2.5x Dividend > At least €0.6
Slide 25: Material consumption in 2016
Material consumption in 2016 As of December 2016 COGS BREAKDOWN MATERIAL CONSUMPTION DETAIL Traded goods Others Raw materials 22% 18% 55% Transport Oil derivatives Total COGS and logistics €1,996m 53% 10% Payroll Other raw materials 17% 25% Tarkett - Q1 2017 Financial Results - April 26, 2017 at 11:
Slide 26: Shareholder composition
Shareholder composition As of April 2017 Société d’Investissement Deconinck 50.2% Treasury shares 0.6% Free float 49.2% Tarkett - Q1 2017 Financial Results - April 26, 2017 at 11:00 AM 26
Slide 27: International and entrepreneurial teams
International and entrepreneurial teams Executive Management Committee Operational leaders Functional leaders Raphaël Bauer Michel Giannuzzi CFO Fabrice Barthélemy President EMEA CEO Member of the Management Board & Chairman of the Management Board Sharon MacBeath Human Resources Member of the Manag
Slide 28: Global flooring market
Global flooring market World flooring market = 12.5bn sqm(1) > Flooring market is growing more or less in line with GDP growth, with specificities by region and product Ceramics 62% Wood & Laminate > Flooring market (excluding 11% ceramics) is ~80% exposed to renovation Vinyl, Linoleum 25% & Rubber
Slide 29: Flooring preferred categories vary greatly across the world
Flooring preferred categories vary greatly across the world North America: 1.6bn sqm Europe(1): 1.5bn sqm CIS: 0.5bn sqm 18% 30% 32% 51% 28% 9% 15% 18% 32% 15% 21% 27% 1% 3% 0% Ceramics 13% 12% 4% Carpet Vinyl, Linoleum & Rubber Wood & Laminate Other (non-resilient) 9% 11% 51% Latin America: 1.2bn s