Technogym S.p.a · MIL:TGYM
Technogym — FY2018 Earnings Presentation
22 slides from Technogym's earnings presentation, 2019
Slide 1: Financial results 2018
Financial results 2018
Slide 2: >35 years of organic growth
>35 years of organic growth €m 634 0 1984 1986 1990 1994 1998 2002 2006 2010 2014 2015 2016 2017 2018 Key events official supplier Strictly private & confidential 2
Slide 3: Technogym disruptive innovation
Technogym disruptive innovation + CONTENT & SERVICES COMPETENCIES + SW & CLOUD 4.0 + ELECTRONICS 3.0 BIOMECHANICS 2.0 1.0 1983 1995 2000 2015 2020 Strictly private & confidential 3
Slide 4: Strictly private & confidential – 4
Strictly private & confidential – 4
Slide 5: Strictly private & confidential
Strictly private & confidential 5
Slide 6: SKILLATHLETIC: our new experience for athletic training
SKILLATHLETIC: our new experience for athletic training A new immersive training experience accessible both in existing Clubs or in new boutique fitness studios Strictly private & confidential 6
Slide 7: SKILL LINE: a new product category defined by Technogym
SKILL LINE: a new product category defined by Technogym Inspired by athletes, skill line has sport in its DNA. Design and technology to unleash your inner athlete Strictly private & confidential 7
Slide 8: 2018: Technogym confirms its profitable growth
2018: Technogym confirms its profitable growth Currency neutral double-digit top line growth, significantly outpacing the market and competitors in all the key geographies Profitability enhancement: 21,2% EBITDA margin and 16,9% EBIT margin Net Profit grew by 53% Y/Y to EUR 93m Sound net fin
Slide 9: Revenues showed high single-digit growth
Revenues showed high single-digit growth Revenues (€m) Key comments +8,0% +10,4% 647,8 Positive volume effect primarily 634,1 coming from 587,0 • Overseas market (NA, APAC) and Italian market • Commercial vertical segments (H&R and HCP) • Standard business, thereby diversifying the risk related to K
Slide 10: Top line growth mainly driven by new customers
Top line growth mainly driven by new customers Revenues growth (€m) Key comments 38,4 634,1 Existing clients • Represented 18% of incremental revenues • Accounted for c. 71% of total revenues in 2018 New clients • Represented 82% of incremental revenues 8,7 • Accounted for c. 29% of total revenues i
Slide 11: Revenue growth driven primarily by NA, APAC & Italy
Revenue growth driven primarily by NA, APAC & Italy Revenue breakdown by geography - €m, percentage incidence & change 2018 vs. 2017 8,0% 634,1 587,0 324,9 Europe 9,2% 297,4 (51%) (excl. Ita) (51%) 101,9 87,6 (16%) APAC 16,4% (15%) 65,9 77,3 North 17,3% (11%) (12%) America 55,3 15,5% 63,8 Italy (9%)
Slide 12: Growth driven primarily by field sales
Growth driven primarily by field sales Revenue breakdown by channel - €m, percentage incidence & change 8,0% 2018 vs. 2017 634,1 587,0 468,3 409,5 Field sales 14,4% (74%) (70%) 131,1 121,4 -7,4% Distributors (22%) (19%) Inside sales -7,3% 40,8 37,8 18,0% 5,6 6,6 Retail (7%) (6%) (1%) (1%) 2017 2018
Slide 13: Profit and Loss statement
Profit and Loss statement Key comments (€m) Dec Net operating income drivers 2018 vs 2017 2018 • Commercial customers leading the 2017 Total revenue 587,0 634,1 8,0% growth with sound contribution from HCP and H&R Cost or raw, ancillary and consumab le materials (194,6) (200,5) 3,0% • Revenues drive
Slide 14: EBITDA adjusted growing at >10% vs Y-1
EBITDA adjusted growing at >10% vs Y-1 with positive impact on profitability (21,2% vs 20,4% of Y-1) EBITDA evolution (€m) Key comments +6% EBITDA adjusted margin increase: +12% 141,8 134,4 • Positive effect mainly driven by product mix (i.e. higher weight of 119,9 Skill Line) • Declining direct cos
Slide 15: Technogym confirmed a strict control on Costs
Technogym confirmed a strict control on Costs Recurring cost base evolution (% REV) Key comments Total costs €496m €525m * D&A / Impairments • Decline driven by lower D&A on intangibles % REV 84.5% 82.7% Impairments 1,2% 0,7% 1,0% 0,4% Personnel cost 4,2% 3,5% Other • Moderate increase in value and
Slide 16: Temporary TWC increase due to one offs in 2018
Temporary TWC increase due to one offs in 2018 Working Capital (€m) Key comments (€m) Dec 2017 Dec 2018 The TWC - 15% of revenues in FY 18 – has been Inventories 67,0 89,5 negatively impacted by inefficiencies related to the Trade receivables 111,7 151,5 new ERP implementation. Trade payable (123,2)
Slide 17: CAPEX at 5,1% on revenues, slightly increasing Y/Y
CAPEX at 5,1% on revenues, slightly increasing Y/Y Capex analysis (€m) Key comments % REV 4,2% 5,1% Major Tangibles Capex 32,5 • New warehouse in the Slovakian Tangibles Intangibles plant • Investment in industrial tools and 24,8 molds for new products 17,7 • New air conditioning system installed in
Slide 18: Net Financial Debt
Net Financial Debt Net Financial Debt (€m) Key comments Cash & Cash equivalent • Strong cash position mainly refers to bank deposits € denominated Current bank debt • Mainly composed of credit lines stand-by and short-term financing. As of 31/12/2018 − Lines of credit and overdrafts uncommitted for
Slide 19: Annexes
Annexes
Slide 20: Balance Sheet
Balance Sheet €m Dec 2017 % on Revenues Dec 2018 % on Revenues Inventories 67,0 11,4% 89,5 14,1% Trade receivables 111,7 19,0% 151,5 23,9% Trade payables (123,2) (21,0%) (143,9) (22,7%) Trade Working Capital 55,4 9,4% 97,1 15,3% Other current assets/(liabilities) (51,7) (8,8%) (40,4) (6,4%) Current
Slide 21: Cash Flow statement
Cash Flow statement Dec 2017 vs Dec Dec 2017 vs Dec (€m) Dec 2017 Dec 2018 2018 Δ ass. 2018 Δ % Consolidated profit for the year 61,2 93,5 32,2 52,6% Depreciation, amortization and impairment losses 24,5 22,0 Provisions 4,1 2,6 Share of net result from joint ventures (0,0) (0,3) Net financial expens
Slide 22: EBITDA Reconciliation
EBITDA Reconciliation Dec 2017 (€m) Dec 2017 Dec 2018 vs Dec 2018 Δ% Net operating income 91,1 106,9 17,3% ERP inefficiencies (operation processes) 0,0 3,0 IPO Cost 0,2 0,0 Total not recurring items 0,2 3,0 1.752,1% Adjusted Net operating income 91,2 109,9 20,4% Depreciations, amortisations and writ