Arbonia Ag · SIX:ARBN
Arbonia — H1 2022 Earnings Presentation
35 slides from Arbonia's earnings presentation, Aug 23, 2022
Slide 1: H1 results 2022
H1 results 2022 Alexander von Witzleben, Executive Chairman Daniel Wüest, Group CFO
Slide 2: Overview H1 2022 Key metrics (CHF M)
Overview H1 2022 Key metrics (CHF M) Net revenues EBITDA2 Net debt/cash EBITDA margin Leverage Ratio +19.2% 9.1% 9.2% 11.4% 8.3% 1.0x -0.7x 0.6x +7.2% +8.9% 631 184 529 589 -22.4% 493 68 67 52 48 45 -93 H1 H1 H1 H1 H1 H1 H1 H1 06 12 06 2019 2020 2021 2022 2019 2020 2021 2022 2021 2021 2022 Despite n
Slide 3: H1 2022 in context
H1 2022 in context Reversal of an extraordinary strong H1 2021 Effects H1 2021 Effects H1 2022 Orders pulled forward for fear of rising Sharp rise in raw material and energy prices prices across the board Wholesalers over-stocked warehouses due Wholesalers have largely depleted their over- to limite
Slide 4: Confident market outlook for H2 2022 and beyond
Confident market outlook for H2 2022 and beyond Based on numerous facts despite a challenging environment Building volumes in Germany new Energy crisis construction and renovation • Energy efficiency is required to control running cost of buildings and thus (in EUR bn)1 preserve invested capital CAG
Slide 5: Agenda
Agenda 1. Group results H1 2022 2. Divisional highlights H1 2022 and outlook 3. Outlook Questions H1 results 2022 | 23 August 2022 5
Slide 6: Income Statement
Income Statement As reported (CHF M) In CHF M H1 2022 in % H1 2021 in % I Revenues (+7%) Net revenues 630.9 I 100.0 588.6 100.0 • Up 7.2% due to higher II prices and despite lower FX Cost of material and goods -324.5 -51.4 -264.9 -45.0 II II Cost base Personnel expenses -192.1 -30.4 -189.0 -32.1 • S
Slide 7: Overview H1 2022 Performance by Group and Divisions
Overview H1 2022 Performance by Group and Divisions CHF M1,2 +19.2% +7.2% +25.6% 631 +11.7% 589 +13.1% 529 493 +0.9% Net Revenues 345 275 305 282 284 246 255 247 0 H1 2019 H1 2020 H1 2021 H1 2022 H1 2019 H1 2020 H1 2021 H1 2022 H1 2019 H1 2020 H1 2021 H1 2022 +8.9% EBITDA +5.2% -22.4% +12.2% -24.8%
Slide 8: Arbonia Group: EBITDA Bridge H1 2021 – H1 2022
Arbonia Group: EBITDA Bridge H1 2021 – H1 20221 Price increases almost covered higher material, energy and logistics costs Amounts in CHF M -22.0% 67.2 14.8 52.4 EBITDA SPI SVI MCC SI PI ECC Residual FX-Effect Corporate EBITDA H1 2021 Services H1 2022 1) 2) 3) 4) 5) 6) 7) 8) 9) Explanations: 1) SPI
Slide 9: Net revenues by Division and Region
Net revenues by Division and Region Only marginal changes in revenue split by Division and Region Net revenues by Division Net revenues by Region 12% (12%) 8% (8%) 45% 55% 8% 50% (48%) (52%) (7%) (51%) 9% (9%) 13% (13%) HVAC Doors Germany Eastern Europe Switzerland Benelux Southern Europe RoW Figure
Slide 10: Overview organic revenue growth H1 2020-2022
Overview organic revenue growth H1 2020-2022 In CHF M +28.9% +9.8% +16.5% 675 631 1.8x 589 • Strong organic growth based on volume and 600 1.6x price effects since 2020 525 493 1.4x • Organic growth H1 2022 of +9.8% mainly 450 1.2x based on price effects 375 1.0x 300 0.8x • Division HVAC with an org
Slide 11: Cash flow statement
Cash flow statement In CHF M1 I Cash flow from operating activities -120.2 M • Cash flow from operating activities turns 100 negative in H1 2022 mainly due to substantial increase of NWC (CHF 118 M) … 50 92.8 51.6 • …and lower operational performance in 0 -68.6 H1 2022 -50 • Negative NWC effect in H
Slide 12: Net cash to net debt bridge
Net cash to net debt bridge In CHF M Net Cash (12 2021) -93 Capex 49 Purchase Corporate Center (CC) 25 Elimination IFRS 16 CC -6 Dividend 21 Purchase treasury shares 4 New lease liabilities 7 EBITDA H1 22 -52 Change of NWC H1 22 118 Others 3 CF from operating activities 69 FX-Impact -8 Net Debt (06
Slide 13: Net debt as of June 2022
Net debt as of June 2022 In CHF M 200 184 2.7x I Net debt 59 1.8x• Substantial cash-out leading to a net debt 150 position 100 0.97 • Cash outflow of CHF 161 M mainly due to 68 0.9x negative CF from operating activities (CHF 69 125 0.62 M), capex (CHF 74 M) and dividend payment 50 23 (CHF 21 M) 45 2
Slide 14: Agenda
Agenda 1. Group results H1 2022 2. Divisional highlights H1 2022 and outlook 3. Outlook Questions H1 results 2022 | 23 August 2022 14
Slide 15: HVAC: Energy efficiency supports mid-term growth
HVAC: Energy efficiency supports mid-term growth Number of heat pumps sold in • For overall construction, mixed messages on mid-term Germany (in thousands)1 outlook: high housing demand – yet, rising interest rates and high building material price levels dampen the outlook 510 • In HVAC, energetic m
Slide 16: HVAC: Comprehensive solutions for energy-efficient heating, cooling and ventilation
HVAC: Arbonia offers comprehensive solutions for energy-efficient heating, cooling and ventilation Residential Commercial BMS air handling unit fan coil radiant ceiling panels Skystar cleanroom engineering fan coil wall unit radiant ceiling profile app cascaded heat pump column radiator trench conve
Slide 17: HVAC: Growth products in strong demand in H1 2022
HVAC: Growth products in strong demand in H1 2022 Ambition: 2/3 net revenues with growth products Battery Heat pump Radiators Floor Net revenues heating by product (ambition) Growth products Mature products Ventilation High volume and Volume decrease & Thermal price increase high price increases tra
Slide 18: HVAC: Scaling up our heat pump production
HVAC: Scaling up our heat pump production Opočno (CZ) heat pump factory • Addressing the growing demand across Europe for energy- efficient heat generation • Successful completion of "greenfield" factory in Opočno (CZ) with start of production happened • Ramp-up of production in progress • Once in f
Slide 19: HVAC: Redox-Flow battery now in the market
HVAC: Redox-Flow battery now in the market • Enabling a high degree of energy self-supply for buildings in combination with solar panels and heat pumps – a rapidly growing market • High-performing, long-lasting, environmental friendly Redox- Flow technology with performance of initially 6 kWh (and l
Slide 20: HVAC: Further strengthening our position in radiators
HVAC: Further strengthening our position in radiators German SPR1 market (units) • Executing our "best-in-class" radiator strategy in a stagnating European market (home market Germany slightly declining) CAGR -2% • Exceptional tailwind in 2020 and 2021 due to COVID-19- +7% related demand and over-st
Slide 21: HVAC: New product launches in ventilation
HVAC: New product launches in ventilation Energy Smart • Launching several new ventilation products after dedicated Residential R&D efforts – ranging from low air flow in Residential Ventilation: applications to high air flow in Commercial environment • Volume growth of ~ 30% in ventilation H1 2022
Slide 22: Doors: Challenging H1 but confident for H2 2022
Doors: Challenging H1 but confident for H2 2022 Number of permits issued for flats in new • 24% of construction wood imports in Germany construction in Germany1 impacted by war in Ukraine lack of materials -1.4% • Rapidly rising raw material prices, to be 109’000 107’507 compensated by price incre
Slide 23: Doors: Tapping into a door's full life-time value
Doors: Tapping into a door's full life-time value Arbonia Doors will profit from a door's entire lifecycle Planning services Production • Site measuring for • Become full range shower enclosures provider for all Planning functionalities and • Planning of digital Production materials access managemen
Slide 24: Doors: Allocating and leveraging additional capacities
Doors: Allocating and leveraging additional capacities Increasing revenues and productivity Additional capacities (in M doors) Used for… +0.8 M • Increase volume and gain market share • Reduce order backlog followed by taking-out expensive extra shifts (3rd and weekend shifts) increasing productiv
Slide 25: Doors: New frame production line online
Doors: New frame production line online New frame production site Prüm bringing new capacities of 800k units as of 2024 (picture: August 2022) Combined heat and power plant Prüm will supply all heat needed and a majority of the energy (picture: August 2022) H1 results 2022 | 23 August 2022 25
Slide 26: Doors: Arbonia Glass solutions
Doors: Arbonia Glass solutions Market environment Measures • Market shortage on professional installers • Arbonia Glassystems (former GVG Deggendorf) will leverage its capabilities to • The few remaining installers focus capacities provide tailor-made glass products on HVAC products due to high marg
Slide 27: Agenda
Agenda 1. Group results H1 2022 2. Divisional highlights H1 2022 and outlook 3. Outlook Guidance Questions H1 results 2022 | 23 August 2022 27
Slide 28: Demand in commercial and infrastructure is picking-up
Demand in commercial and infrastructure is picking-up, economic uncertainty unlikely to impact renovation Arbonia's approximate revenue split by segments New construction Health and Education 35% Single-family house Industrial Retail and Renovation Office 65% Multi-family house (Flats) Hotels Reside
Slide 29: Outlook 2022
Outlook 2022 Annual results 2021 Guidance 2022 1 March 2022 23 August 2022 Organic growth1 Organic growth1 Organic growth1 11.6% > 5.0% > 5.0% EBITDA margin2 EBITDA margin2 EBITDA margin2 11.3% 10.8 – 11.2%3 10 – 11% Capex4 Capex5 Capex5 9.5% ~10% ~10% Healthy order backlog, stabilisation of raw mat
Slide 30: Appendix
ARBONIA @ Appendix
Slide 31: Organic growth
Organic growth1 Organic growth driven only by price effects Net revenues as Δ FX Acq. Organic reported H1 2022 H1 2021 Year Effect growth1 Effect in CHF M Total Arbonia Group 630.9 588.6 +7.2% -5.2% +2.6% +9.8% HVAC 344.9 304.9 +13.1% -5.8% +3.2% +15.7% Doors 284.2 281.6 +0.9% -5.0% +2.2% +3.7% 1 ad
Slide 32: Balance sheet
Balance sheet In CHF M 2′000 1′623 1′538 I Assets 1′500 36.5% 34.7% • Lower asset base mainly due to use of liquid 1′000 funds and FX translation effect • Shift of liquid funds into working capital 500 63.5% 65.3% 0 12 2021 06 2022 Current assets Non-current assets II Liabilities and shareholders' e
Slide 33: Operating NWC
Operating NWC1 In CHF M 300 22.8% 25% 250 20% 200 13.5% 13.5% 15% 12.7% 150 280 10% 100 153 160 132 5% 50 0 0% 2020 H1 2021 2021 H1 2022 NWC in % of sales NWC Operating NWC = Accounts receivable + accounts receivable project business + inventories + contract assets – accounts payable – advance payme
Slide 34: Arbonia shareholder structure
Arbonia shareholder structure As of 30 June 2022 Free float market capitalisation: CHF 640 M3 22% 3% 3% 72% Free float1 Artemis Beteiligungen I AG Leo Looser Arbonia management2 Tradeable free float of ~72% 1 Every other shareholder with <3% of shares outstanding 2 Members of the Board of Directors,
Slide 35: Thank you
ARBONIA @ Thank you