Diebold Nixdorf Incorporated · NYSE:DBD
Diebold Nixdorf — Investor Presentation (September 2021)
56 slides from Diebold Nixdorf's investor presentation, September 2021
Slide 1: Investor Presentation September 2021
Investor Presentation September 2021 www.dieboldnixdorf.com 0 | DIEBOLD NIXDORF
Slide 2: Use of Non-GAAP Financial Information
Use of Non-GAAP Financial Information To supplement its condensed consolidated financial statements presented in accordance with GAAP, the company considers certain financial measures that are not prepared in accordance with GAAP, including non-GAAP results, adjusted diluted earnings per share, free
Slide 3: Forward-looking Statements
Forward-looking Statements This document contains statements that are not historical information are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, including statements regarding potential impact of the ongoing coronavirus (COVID-19) pandemic
Slide 4: Diebold Nixdorf is the Global Leader in Connected Commerce
Diebold Nixdorf is the Global Leader in Connected Commerce Largest global ATM installed #1 ATM multivendor #1 Retail footprint #1 Global self-ordering kiosk base1 with 30% market share1 monitoring software2 in Europe3 supplier with 19% share4 AMERICAS RETAIL EURASIA BANKING BANKING Software Services
Slide 5: Critical Technology Partner to Financial Institutions and Retailers
Critical Technology Partner to Financial Institutions and Retailers Banking Solutions Retail Solutions ▪ Integrate self-service, digital and branch channels ▪ Integrate self-services, digital and store channels ▪ Enhance operational efficiency ▪ Enhance operational efficiency ▪ Enable personalized j
Slide 6: DN Now Transformation Nearing Completion
DN Now Transformation Nearing Completion Timeline 2019 2020 2021 Streamline operating model Benefits Simplify product portfolio & manufacturing footprint Operational Services modernization plan Excellence • Gross savings target of ~$500M Harvest G&A efficiencies through 2021 Complete Digital transfo
Slide 7: Key Metrics of Transformation Journey
Key Metrics of Transformation Journey TTM1 Adjusted EBITDA2 & Margin Return on Invested Capital COVID-19 COVID-19 600 20.0% 20% DN Now Initiatives DN Now Initiatives ~17% 18.0% $455 - $475 18% 500 $453 16.0% 15% 15% $401 14.0% 400 11.6% 11.5% 13% 12.0% $320 300 9.1% 10.0% 10% 9% 7.0% 8.0% 8% 200 6.0
Slide 8: DBD Investment Thesis
DBD Investment Thesis Transforming the Business Model to Generate Strong Free Cash Flow and ROIC Free Cash Flow1 as a % of Adjusted EBITDA1 Return on Invested Capital1 > 20% ~50% ~17% 25% – 30% 15% 13% 2 2 2020 2021 Outlook 2023 Target 2020 2021 Outlook 2023 Target Leveraging Competitive Differentia
Slide 9: Growth Strategy Rooted in Foundational Strengths & Advanced Capabilities
Growth Strategy Rooted in Foundational Strengths & Advanced Capabilities Foundational Strengths Advanced Capabilities Drive Growth Opportunities Banking Supporting Our Customers’ Digital Self-Service Product-Related Terminal Cash Recycling & Managed Value-Add Transformation Agenda Products Services
Slide 10: Banking Solutions
Banking Solutions 9 | DIEBOLD NIXDORF
Slide 11: Comprehensive Suite of Banking Solutions
Comprehensive Suite of Banking Solutions 55% Services Maintenance and Total Implementation Self Service Fleet Branch Design and Branch Management Availability Services Services Management Deployment and Advisory Services Suite of Managed Services 35% Products Indoor Lobby Cash Recyclers Intelligent
Slide 12: Key Partner to Financial Institutions
Key Partner to Financial Institutions Serving the majority of the #1 in Total ATM Top 100 Application and financial institutions Monitoring globally Ranked Software4 Top Ten in the 2020 Global IDC #1 leader FinTech of the ADT Rankings2 in ATMs market5 installed globally1 ~30% ~$2.8 global market sha
Slide 13: The Market Leader in ATMs Globally
The Market Leader in ATMs Globally Global ATM Installed Base Global Annual Cash Withdrawals 2020 Global Installed Base (millions of units) (billions of withdrawals) Market Share #1 3.3 3.2 3.2 98.3 94.9 Others Diebold 3.1 3.0 92.6 82.4 Nixdorf 75.2 30% 3.1M units 2017 2018 2019 2020 2026E 2017 2018
Slide 14: Differentiated Go-to-Market Strategy
Differentiated Go-to-Market Strategy Growth Stable Mature GDP per Capital $1,000 – $7,000 $7,000 - $60,000 $60,000+ ATM Installed Base1 ~1M ~0.5M ~1M ~5% CAGR 1 - 2% CAGR -2% CAGR Demand for Physical Growing Stable Stable to Slightly Declining Currency Selected countries ▪ Egypt ▪ Mexico ▪ United St
Slide 15: Market Share Gains from DN Series Competitive Advantages
Market Share Gains from DN SeriesTM Competitive Advantages Competitive Advantages ✓ Modular and upgradeable design ✓ Intelligent use of IoT & machine learning (AllConnect Data Engine) ✓ Higher capacity cassettes in a smaller footprint ✓ Improved physical and digital security features ✓ Branding & pe
Slide 16: Improving Service Levels with AllConnect Data Engine
Improving Service Levels with AllConnect Data Engine Data-Driven Approach to Services Significant Reductions in Call Rates CORRELATE Data is correlated/analyzed 49% GATHER against historical norms 45% Sensors provide machine performance data 24% 22% 26% 20% ACT 19% 12% Real time, actionable data UPL
Slide 17: Managed Services Growth Opportunity
Managed Services Growth Opportunity Elements of Managed Services Over 1,300 Managed Service Customers Analytics, Insights & Location Strategy & Reporting Management User Experience & Americas Marketing Management Hardware Lifecycle Management Software Lifecycle Partner Management Management Transact
Slide 18: Vynamic Banking Software Portfolio
Vynamic Banking Software Portfolio ATM TERMINAL SOFTWARE VALUE-ADD DIGITAL PORTFOLIO PAYMENTS SOFTWARE Core Growth Growth • Cloud, micro-services payment switching • NextGen web-enabled ATM multivendor • Video, Marketing, Cardless Cash, Teller • Debit, ATM, Teller, IVR, POS, Real Time, P2P • Mobile,
Slide 19: Retail Solutions
Retail Solutions 18 | DIEBOLD NIXDORF
Slide 20: Comprehensive Suite of Retail Solutions
Comprehensive Suite of Retail Solutions 46% Products ePOS Systems Self-Checkout Interactive Kiosks Retail Cash Reverse Vending Peripherals Management 39% Services Maintenance and Total Implementation Managed Managed Mobility Horizontal Managed Availability Services Services Self Service Services Ser
Slide 21: Key Partner to Retailers
Key Partner to Retailers #1 Globally in new POS software installations2 #1 in retail EPOS #1 in the global & self-checkout >1.3 M in Europe3 market for self- ordering kiosks5 global EPOS installations worldwide3 24 ~$1.2 of Top 25 retailers DN SCO installations in billion 9 out of 10 in Europe >50 c
Slide 22: Retail Trends Present Opportunities for Value Creation
Retail Trends Present Opportunities for Value Creation Consumer/Market Trends Retailer Priorities Value-Creation Opportunities Leverage self-service expertise to ✓ Continued market leadership and service Low Touch Economy deliver low-touch and friction-free consumer shopping experiences delivery acr
Slide 23: Growth of Retail Checkout Installed Base Led by Self-Checkout
Growth of Retail Checkout Installed Base Led by Self-Checkout Global Installed Base1 of Retail Checkout (millions) Projecting Broad-based SCO Growth SCO as a % of Retail Checkout Installed Base Column1 17.0 2020A 2026E SCO 13% EPOS 1.6 15.3 15.3 14.9 11% 14.6 0.5 0.6 0.3 0.3 10% 10% 9% 10% 9% 8% 7%
Slide 24: Market Share Gains with DN Series EASY Self Checkout Solutions
Market Share Gains with DN Series EASY Self Checkout Solutions Pro Express Express Max Delivering value for customers More Modular Enabling customizable solutions 3 x Head Units for different retailer needs and customer journeys 3 x Base Units Pro Cash Express Card Only Rack Cash Rack Pole More Open
Slide 25: Financials
Financials 24 | DIEBOLD NIXDORF
Slide 26: Leveraging Competitive Differentiation for Growth in Q2-21
Leveraging Competitive Differentiation for Growth in Q2-21 • Revenue growth of 6% YoY - Retail revenue growth of 38% YoY • Strong product order growth of ~40% • Backlog growth of ~20% - Banking share gains led by DN Series ATMs TM - Retail strength led by self-checkout • DN AllConnect Data Engine ac
Slide 27: Financial Highlights of Q2-2021
Financial Highlights of Q2-2021 Total Revenue ($M) Gross Profit1 ($M) & Margin1 Organic FX and Divestitures Non-recurring Cost Benefits $944 $264 $262 $890 +6% as $30M Column1 reported ~$20M ~$30M delayed to future periods due +2.5% adjusted to global supply 29.6% 27.7% for FX & divestitures chain c
Slide 28: Eurasia Banking Highlights for Q2-2021
Eurasia Banking Highlights for Q2-2021 Revenue ($M) $338 $24 $326 • 39% YoY product order growth and market share gains ($24) ($12) led by DN Series • Revenue decreased 3% as reported and 7% adjusted for currency & divestitures primarily due to lower Product volume in Mediterranean countries Q2-20 C
Slide 29: Americas Banking Highlights for Q2-2021
Americas Banking Highlights for Q2-2021 Revenue ($M) $331 $3 $313 • 44% YoY product order growth and market share gains ($18) ($3) led by for DN Series, including wins at a top 10 and top 25 US bank • Revenue decreased 6% YoY as reported and adjusted for currency & divestitures due to lower volume i
Slide 30: Retail Highlights for Q2-2021
Retail Highlights for Q2-2021 Revenue ($M) • 40% YoY product order growth and market share gains $19 $305 led by SCO solutions $66 $221 • Revenue increased 38% as reported and 28% ($1) adjusted for currency & divestitures • Growth from meaningfully higher SCO and POS volumes, stronger SCO service at
Slide 31: Historical Financials – Revenue and Gross Profit
Historical Financials – Revenue and Gross Profit ($ in millions) TTM Revenue TTM Gross Profit2 Divested Rev., CC, & Account Rationalization Gross Profit Gross Margin % Pro Forma Revenue¹ 130.0% $1,116 $1,118 $1,116 6,000 GAAP Revenue YoY growth $1,106 $1,109 $1,106 50.0% $1,099 110.0% 1,100 $1,097 4
Slide 32: Historical Financials – Operating Profit and Adjusted EBITDA
Historical Financials – Operating Profit and Adjusted EBITDA ($ in millions) TTM Operating Profit1 TTM Adjusted EBITDA1 OP OP % Adjusted EBITDA Adjusted EBITDA Margin % 400 20.0% 600 20.0% $372 $351 $356 $337 18.0% 18.0% 350 $327 $463 500 $303 16.0% $456 $453 16.0% $441 $428 300 $425 $267 14.0% $389
Slide 33: Historical Financials – Levered and Unlevered FCF
Historical Financials – Levered and Unlevered FCF ($ in millions) TTM Free Cash Flow1 TTM Unlevered Free Cash Flow1 $413 450 400 $270 $269 350 300 $208 $215 $215 $195 250 $230 $179 200 $136 150 $93 $96 $67 100 $42 $43 $57 $50 50 $39 0 (50) ($23) ($52) (100) ($79) (150) ($176) (200) Q4-18 Q1-19 Q2-19
Slide 34: Mid-year Summary for 2021
Mid-year Summary for 2021 1st half 2021 results in-line with expectations 2nd half outlook impacted by higher logistics and input costs Strong Customer Demand Challenging Supply Chain Conditions Banking ✓ Winning market share with our next-generation • Longer lead times for components, especially DN
Slide 35: Increasing Complexity of Global Supply Chains
Increasing Complexity of Global Supply Chains Lower Logistics Reliability1 Higher Shipping Costs2 Global Demand for Semiconductors Exceeds Global On-time Arrivals Per 40-foot Container Supply3 Projected 100% $12,000 120 2019 2020 2021 2019 2020 2021 Demand Supply $10,000 115 75% $8,000 110 $6,000 10
Slide 36: Outlook for 2021
Outlook for 2021 2020A 2021 Outlook2 $4.0 - $4.1B Total Revenue $3.9B 3% to 5% YoY growth Adjusted EBITDA1 $453M $455 – $475M $57M $120 – $140M Free cash flow1 ~13% of Adjusted EBITDA 25% - 30% of Adjusted EBITDA ROIC1 ~15% ~17% 1) Non-GAAP metric. See “Use of Non-GAAP Financial Information” and the
Slide 37: 2021 Free Cash Flow Bridge – based on July 29th Outlook
2021 Free Cash Flow Bridge – based on July 29th Outlook Key Inputs to 2021 Free Cash Flow Outlook ($ in millions) Commentary ▪ Collections, Payables, Inventory and Change in working Deferred Revenue A capital & other ▪ Pension, payroll, timing of balance sheet $465 $15 provisioning, VAT and other $1
Slide 38: 2023 Financial Targets
2023 Financial Targets Return on Revenue Profitability Free Cash Flow Leverage Ratio1,3 Invested Capital1,2 2% - 4% > 13% ~ 50% conversion of > 20% < 3X CAGR Adjusted adjusted EBITDA to levered EBITDA1 Margin free cash flow1 > $600M cumulative 3-year levered free cash flow1 1) Non-GAAP metric. See “
Slide 39: Capital Structure and Objectives
Capital Structure and Objectives Debt Maturities1 Capital Structure Objectives • No material maturities until November 2023 • Maintaining sufficient liquidity • Moody’s upgraded CFR to B2 in August 2021 • Maintain sufficient liquidity • S&P upgraded outlook to Positive in May 2021 • Reduce leverage
Slide 40: Supplemental Slides
Supplemental Slides 39 | DIEBOLD NIXDORF
Slide 41: Focusing on Environmental, Social and Governance
Focusing on Environmental, Social and Governance Suppliers Advancing our solutions and business model to reduce our carbon footprint, mitigate risks and generate value Employees Communities for all stakeholders Sustainable Supply Chain Environment, Health Global Customers & Operations & Safety Citiz
Slide 42: Full Year 2020 Profit & Loss Statement
Full Year 2020 Profit & Loss Statement Reconciliation GAAP to non-GAAP ($Millions) Loss making Amortization of Wincor Nixdorf Divestitures Costs related to contract related to Other 2020 % of Net Restructuring and DN Now purchase accounting intangible Legal / deal and fixed asset previously divested
Slide 43: Full Year 2019 Profit & Loss Statement
Full Year 2019 Profit & Loss Statement Reconciliation GAAP to non-GAAP ($Millions) Amortization of Wincor Nixdorf Divestitures Other 2019 % of Net Restructuring and DN Now purchase accounting intangible Legal / deal and fixed asset Acq. Inventory gain non-routine 2019 % of Net (GAAP) Sales transform
Slide 44: Q1 2021 Profit & Loss Statement
Q1 2021 Profit & Loss Statement Reconciliation of GAAP to non-GAAP ($Millions) Restructuring and Other non- DN Now Amortization of Wincor routine 2021 % of Net transformation Nixdorf purchase accounting Legal / deal income / 2021 % of Net (GAAP) Sales expenses intangible assets (non-cash) expense ex
Slide 45: Q1 2020 Profit & Loss Statement
Q1 2020 Profit & Loss Statement Reconciliation of GAAP to non-GAAP ($Millions) Restructuring Amortization of Wincor Loss making and DN Now Nixdorf purchase Divestitures Costs related to contract related Other 2020 % of Net transformation accounting intangible Legal / deal and fixed previously divest
Slide 46: Q2 2021 Profit & Loss Statement
Q2 2021 Profit & Loss Statement Reconciliation of GAAP to non-GAAP ($Millions) 2021 % of Net Restructuring and Amortization of Wincor Legal / deal Other non- 2021 % of Net (GAAP) Sales DN Now Nixdorf purchase accounting expense routine (non-GAAP) Sales transformation intangible assets (non-cash) inc
Slide 47: Q2 2020 Profit & Loss Statement
Q2 2020 Profit & Loss Statement Reconciliation of GAAP to non-GAAP ($Millions) 2020 % of Net Restructuring and Amortization of Wincor Legal / deal Divestitures Inventory Loss making Other 2020 % of Net (GAAP) Sales DN Now Nixdorf purchase expense and fixed asset charge/gain contract related to non-r
Slide 48: Revenue
Revenue Reconciliation of GAAP to Non-GAAP Pro forma ($Millions) Revenue ($M) Q1-18 Q2-18 Q3-18 Q4-18 Q1-19 Q2-19 Q3-19 Q4-19 Q1-20 Q2-20 Q3-20 Q4-20 Q1-21 Q2-21 Revenue (GAAP) $1,064 $1,106 $1,119 $1,290 $1,028 $1,150 $1,079 $1,152 $911 $890 $995 $1,106 $944 $944 YoY % change -3.4% 4.0% -3.6% -10.7
Slide 49: Revenue Variance for FX, Divestitures & Related Actions
Revenue Variance for FX, Divestitures & Related Actions ($Millions) Segment View Business Line $Millions Q2-21 Q2-20 Variance Variance % $Millions Q2-21 Q2-20 Variance Variance % F/(U) F/(U) Eurasia Banking Revenue (GAAP) 326 338 (12) -3.6% Services Revenue (GAAP) 494 469 25 5.3% FX Impact - 24 FX I
Slide 50: Non-GAAP Gross Profit Variance for FX, Divestitures & Related Actions
Non-GAAP Gross Profit Variance for FX, Divestitures & Related Actions Reconciliation of GAAP to non-GAAP ($Millions) Segment View Business Line $Millions Q2-21 Q2-20 Variance Variance % $Millions Q2-21 Q2-20 Variance Variance % F/(U) F/(U) Eurasia Banking Gross Profit (Non-GAAP) 94 102 (8) -7.8% Ser
Slide 51: Gross Profit & Margin
Gross Profit & Margin Reconciliation of GAAP to non-GAAP ($Millions) Gross Profit and Margin Q1-18 Q2-18 Q3-18 Q4-18 Q1-19 Q2-19 Q3-19 Q4-19 Q1-20 Q2-20 Q3-20 Q4-20 Revenue (GAAP) $1,064 $1,106 $1,119 $1,290 $1,028 $1,150 $1,079 $1,152 $911 $890 $995 $1,106 Total Gross Profit (GAAP) $240 $220 $229 $
Slide 52: Gross Profit & Margin – Segment View and Services-only
Gross Profit & Margin – Segment View and Services-only Reconciliation of GAAP to non-GAAP ($Millions) Gross Profit and Margin – Segment View 2018 2019 2020 Q1-21 Q2-21 Revenue (GAAP) $4,579 $4,409 $3,902 $944 $944 Americas Banking 1,516 1,604 1,419 312 313 Eurasia Banking 1,800 1,650 1,431 328 326 R
Slide 53: Operating Profit & Margin
Operating Profit & Margin Reconciliation of GAAP to non-GAAP ($Millions) Operating Profit and Margin Q1-18 Q2-18 Q3-18 Q4-18 Q1-19 Q2-19 Q3-19 Q4-19 Q1-20 Q2-20 Q3-20 Q4-20 Q1-21 Q2-21 Revenue (GAAP) $1,064 $1,106 $1,119 $1,290 $1,028 $1,150 $1,079 $1,152 $911 $890 $995 $1,106 $944 $944 Total Operat
Slide 54: Adjusted EBITDA
Adjusted EBITDA Reconciliation of GAAP to non-GAAP ($Millions) Adjusted EBITDA Q1-18 Q2-18 Q3-18 Q4-18 Q1-19 Q2-19 Q3-19 Q4-19 Q1-20 Q2-20 Q3-20 Q4-20 Q1-21 Q2-21 GAAP Revenue $1,064 $1,106 $1,119 $1,290 $1,028 $1,150 $1,079 $1,152 $911 $890 $995 $1,106 $944 $944 GAAP Net Income ($66) ($116) ($220)
Slide 55: Free Cash Flow
Free Cash Flow Reconciliation of GAAP to non-GAAP ($Millions) Free Cash Flow Q1-18 Q2-18 Q3-18 Q4-18 Q1-19 Q2-19 Q3-19 Q4-19 Q1-20 Q2-20 Q3-20 Q4-20 Q1-21 Q2-21 Net cash provided (used) by operating activities (GAAP measure) ($142) ($114) ($115) $268 ($57) ($11) $75 $128 ($78) ($90) ($29) $215 ($65)
Slide 56: Return on Invested Capital & Net Debt
Return on Invested Capital & Net Debt ($Millions) Return on Invested Capital1 (ROIC) Net Debt TTM 6/30/20 6/30/21 2018 2019 2020 $ Millions Q2 2021 Cash, cash equivalents, restricted cash and short term Revenue $4,579 $4,409 $3,902 $3,989 investments (GAAP Measure) $455 $232 GAAP operating profit (l
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