Dometic Group Ab · OMXSTO:DOM
Dometic Group Ab — Q3 2022 Earnings Presentation
38 slides from Dometic Group Ab's earnings presentation, Oct 26, 2022
Slide 1: Interim Presentation Q3 2022
INTERIM PRESENTATION Q3 2022 October 26, 2022
Slide 2: Juan Vargues, President & CEO
JUAN VARGUES PRESIDENT & CEO
Slide 3: Q3 2022 Highlights
Q3 2022 HIGHLIGHTS Market development ▪ Challenging macroeconomic environment ▪ Retailers continue to rebalance their inventories ▪ Declining RV OEM demand Performance ▪ 37% sales growth, -6% organic ▪ Marine 11% organic growth ▪ Decline in Service & Aftermarket and in RV OEM ▪ Igloo continues to sh
Slide 4: Q3 2022 Financial Summary
Q3 2022 FINANCIAL SUMMARY Net sales of SEK 7,576 m, +37% total growth 20% ▪ -6% Organic 37% ▪ 15% FX 7,576 Net Sales ▪ 28% M&A EBITA EBITA before i.a.c. of SEK 1,057 m, +20% 5,545 ▪ EBITA margin of 14.0% (15.9%) Adjusted EPS of SEK 2.53, +43% Operating cash flow of SEK 812 m (346) Leverage 3.0x (1.5
Slide 5: YTD September 2022 Financial Summary
YTD SEPTEMBER 2022 FINANCIAL SUMMARY Net sales of SEK 23,591 m, +48% total growth 29% ▪ 0% organic 48% ▪ 10% FX 23,591 Net Sales ▪ 38% M&A EBITA EBITA before i.a.c. of SEK 3,501 m, +29% 15,974 ▪ EBITA margin of 14.8% (17.0%) Adjusted EPS of SEK 7.78, +34% Operating cash flow of SEK 1,151 m (1,203) 3
Slide 6: Sales Growth Q3 2022
SALES GROWTH Q3 2022 Net Sales LTM 29,134 mSEK Q3 2022 Net Sales SEK 7,576 m ▪ Total Growth SEK 2,030 m (+37%) ▪ Americas 0% ▪ EMEA +8% 37% ▪ APAC +10% ▪ Marine +33% 24% 28% ▪ Global +699% ▪ Organic Growth -6% ▪ Marine +11% 15% ▪ EMEA, APAC and Global. All -3% -6% ▪ Americas -23% Q3 2020 Q4 Q1 Q2 Q3
Slide 7: Application Areas Q3 2022
APPLICATION AREAS Q3 2022 Climate Food & Beverage SALES SPLIT YTD, R12 Quarter R12 Quarter APPLICATION AREA 9,000 +6% 3,000 12,000 +104% 5,000 8,500 2,500 11% 2,148 10,000 4,000 8,000 2,000 29% 8,000 2,920 3,000 7,500 1,500 6,000 21% 7,000 1,000 2,000 4,000 6,500 500 1,000 2,000 6,000 0 0 Q3 Q4 Q1 Q
Slide 8: Sales Channels Q3 2022
SALES CHANNELS Q3 2022 SERVICE AND AFTERMARKET SALES SPLIT YTD, R12 Quarter SALES CHANNEL 8,500 -1% 3,000 8,000 2,500 2,097 7,500 2,000 7,000 30% 1,500 6,500 43% 1,000 6,000 5,500 500 5,000 0 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2020 2021 2022 27% OEM DISTRIBUTION +19% Quarter R12 Quarter R12 OEM (51%) 13,000
Slide 9: Sales Channel Development
SALES CHANNEL DEVELOPMENT DISTRIBUTION + SERVICE & AFTERMARKET FROM 50% TO 57% IN ONE YEAR NET SALES, SEK m 8,000 7,576 ▪ RV OEM 23% (31%) 7,000 ▪ M&A and divestment agenda supports 29% continued transformation 6,000 5,545 5,000 12% 28% 4,000 38% 3,000 CPV OEM 5% 2,000 50% 43% Marine OEM 15% 1,000 R
Slide 10: Service & Aftermarket Sales
SERVICE & AFTERMARKET SALES RETAILER DESTOCKING AFTER 2021 – Q1 2022 RALLY 2021 2022 ▪ Retailers are destocking after large purchases in 2021 and Q1 2019 2018 2022 ▪ 2022 above 2018-2019 levels 2020 ▪ Gradual recovery expected coming quarters Q1 Q2 Q3 Q4 2018 2019 2020 2021 2022 Sales in constant cu
Slide 11: EBITA and EBITA Margin before i.a.c.
EBITA AND EBITA MARGIN BEFORE I.A.C EBITA Run rate +14.2% (+16.1%) EBITA- SEKm margin Q3 2022 1,350 17% EBITA margin 14.0% (15.9%) 1,200 ‒ Igloo margins lower than Group average 16% 1,050 ‒ Major impact from sales channel mix 15% ‒ Extraordinary logistic-related costs in 900 EMEA 750 14% ‒ Raw mater
Slide 12: Sales and EBITA Development 2017-2022
SALES AND EBITA DEVELOPMENT 2017 - 2022 SEK M Net sales EBITA before i.a.c. +SEK 4,177 m +SEK 558 m +128% +112% 7,576 1,057 5,545 879 4,605 757 763 4,501 4,466 695 3,399 499 2017 Q3 2018 Q3 2019 Q3 2020 Q3 2021 Q3 2022 Q3 2017 Q3 2018 Q3 2019 Q3 2020 Q3 2021 Q3 2022 Q3
Slide 13: Segment Americas Q3 2022
SEGMENT AMERICAS Q3 2022 Net sales SEK 1,718 m, 0% growth ▪ -23% organic growth ▪ RV OEM reduced as anticipated ▪ Service & Aftermarket declined compared to a strong 2021 as retailers are rebalancing inventory levels Net sales and EBITA margin before i.a.c. 2,000 9% 1,800 8% EBITA before i.a.c. SEK
Slide 14: Segment EMEA Q3 2022
SEGMENT EMEA Q3 2022 Net sales SEK 1,871 m, +8% ▪ Organic growth -3% ▪ Decline in Service & Aftermarket as retailers are rebalancing inventory levels ▪ Growth in OEM business driven by CPV customers Net sales and EBITA margin before i.a.c. 2,400 18% EBITA before i.a.c. SEK 162 m (257) 2,200 16% 2,00
Slide 15: Segment APAC Q3 2022
SEGMENT APAC Q3 2022 Net sales SEK 567 m, +10% ▪ Organic growth -3% ▪ Lower sales in Distribution and Service & Aftermarket ▪ Strong momentum in Mobile Power Solutions Net sales and EBITA margin before i.a.c. 600 35% EBITA before i.a.c. SEK 151 m (131) 550 ▪ EBITA Margin 26.6% (25.4%) 500 450 30% ▪
Slide 16: Segment Marine Q3 2022
SEGMENT MARINE Q3 2022 Net sales SEK 1,828 m, +33% ▪ Organic growth +11% driven by OEM ▪ Backlog in line with last year ▪ Continued technology shift towards more electronic steering systems Net sales and EBITA margin before i.a.c. 2,000 30% EBITA before i.a.c. SEK 469 m (362) 1,800 ▪ EBITA Margin 25
Slide 17: Segment Global Q3 2022
SEGMENT GLOBAL Q3 2022 Net sales SEK 1,592 m, +699% ▪ Organic growth -3%, decline in Residential ▪ Strong growth in Hospitality ▪ Igloo - continued double-digit growth (pro forma) EBITA before i.a.c. SEK 174 m (37) ▪ EBITA Margin 11.0% (18.4%). Igloo has dilutive impact 2,000 Net sales and EBITA mar
Slide 18: Igloo Performance
IGLOO PERFORMANCE IGLOO STANDALONE IMPROVEMENTS ARE GENERATING RESULTS Year to date financial performance Synergies of USD 50 m to be ▪ Proforma sales growth close to 20% realized within 5 years from date of transaction ▪ Resilient business Cost synergies ▪ Continues to gain market shares ▪ Retailer
Slide 19: Igloo – Gaining Shares on a Growing Market
IGLOO – GAINING SHARES ON A GROWING MARKET US Market share (in value) Igloo net sales, USD m 300 33% 250 200 20% 20% 16% 16% 15% 150 11% 100 9% 50 0 2018 2022 2018 2022 2018 2022 2018 2022 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Competitor A Competitor B Competitor C +13%-points -4%-points
Slide 20: Mobile Power Solutions
MOBILE POWER SOLUTIONS MEETING THE RAPIDLY INCREASED END-USER DEMAND FOR SUSTAINABLE AND EFFECTIVE OFF-GRID PRODUCTS ▪ Established a global platform of Mobile Power Solutions ▪ Six acquisitions completed in 2021-2022 across three geographical regions ▪ Strong underlying growth driven by electrificat
Slide 21: New Mobile Power Solutions Portfolio
NEW MOBILE POWER SOLUTIONS PORTFOLIO USING ASSETS FROM ACQUIRED BUSINESSES ▪ Complete Mobile Power Solution portfolio ▪ Power electronics products for all vehicle sizes, demands and price ranges ▪ Solar modules ▪ Charging boosters & Power Unit ▪ Lithium and AGM batteries ▪ Inverters & battery charge
Slide 22: Commercial Vehicle Solar Kit
COMMERCIAL VEHICLE SOLAR KIT GO POWER DOMETIC PLUG-AND-PLAY SOLAR KIT ▪ Plug-and-play solar kits for trucks and busses ▪ Reduces idle time, extend battery life and eliminate service calls due to dead batteries ▪ Go Power Dometic product brand - 25 years of experience with >1 million solar modules in
Slide 23: Inflatable Rooftop Tent for Passenger Cars
INFLATABLE ROOFTOP TENT FOR PASSENGER CARS DOMETIC TRT 140 AIR – NEW SERIES ▪ For weekenders who use their passenger cars for camping in the countryside ▪ Lightweight and easy to pitch ▪ Compact enough to be installed on the roof of a regular passenger car ▪ Small footprint giving extra space to tra
Slide 24: E-Commerce – DTC
E-COMMERCE – DTC Activities Net sales, SEK m ▪ Global platform implemented in US, Australia Distribution and Service & Aftermarket Of which and Marine driving organic growth DTC 6% 16,000 ▪ Implemented in eight countries in Europe 14,000 ▪ Broadened Outdoor Stand Alone offering 12,000 ▪ Know-how fro
Slide 25: Cost Reductions
COST REDUCTIONS ▪ Two ongoing programs ▪ Initial program announced 2019 ▪ Target saving of SEK 400 m by mid 2023 ▪ Cost of SEK 750 m ▪ Next phase announced Q2 2022 ▪ Target saving of SEK 200 m by the end of 2023 ▪ Cost of SEK 200 m ▪ Cost in the quarter SEK 329 m, 500 employees affected ▪ Provision
Slide 26: 2022 Strategy Execution
2022 STRATEGY EXECUTION 1▪ Profitable expansion ▪ Year to date sales growth 48% ▪ Acquisitions contribute with profitable growth ▪ Distribution and Service & Aftermarket share of sales 57% (50%) 2▪ Product leadership ▪ Innovation index 15% (26%) - component supply issues affecting new product launch
Slide 27: Sustainability
SUSTAINABILITY ▪ LTIFR1) reduced 29% compared to the same period last year KPI Focus area Actual 2024 Target ▪ Implementation of Health & Safety guidelines LTIFR1) People 1.7 <2.0 continues Share of female managers People 23% 27% CO2 tonne / Net sales SEK m Planet -34% -30% ▪ Share of female manager
Slide 28: Stefan Fristedt, CFO
STEFAN FRISTEDT CFO
Slide 29: EBITA Development
EBITA DEVELOPMENT ▪ Organic + FX + Currency translation and transaction effects + Cost reductions ‒ Organic sales decline ‒ Sales channel mix EBITA bef i.a.c. SEK m (% of sales) ‒ Extraordinary logistic-costs in EMEA SEK 1,057 m ‒ Investments in R&D 1,200 (14.0%) SEK 879 m Neutral impact from Price
Slide 30: Cash Flow for the Period
CASH FLOW FOR THE PERIOD SEK m Q3 2022 Q3 2021 ▪ Operating cash flow SEK 812 m (346) EBIT after items affecting comparability 575 762 ▪ Adjustments for non-cash items relates to Adjustments for non-cash items 744 155 Provisions, Depreciation, Amortization and FX Changes in Working Capital -366 -473
Slide 31: Operating Cash Flow
OPERATING CASH FLOW SEK m 1,400 200% 1,200 1,000 150% 800 1,301 100% 600 1,043 917 875 400 738 812 724 546 50% 200 311 346 181 0 -20 0% -200 -398 -400 -50% Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2019 2019 2020 2020 2020 2020 2021 2021 2021 2021 2022 2022 2022 Operating cash flow Cash conversion
Slide 32: Working Capital Days
WORKING CAPITAL DAYS ACCOUNTS PAYABLES DAYS ACCOUNTS RECEIVABLES DAYS 55 70 61 Inventories 50 47 60 45 ▪ Increase compared to Q2 due to FX 50 40 ▪ Expect inventories to start trending 40 35 down, decline in the month of 30 30 September Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2020
Slide 33: Capex and Research & Development
CAPEX AND RESEARCH & DEVELOPMENT (SEK m, % OF NET SALES) CAPEX 200 8% ▪ Q3 2022 CAPEX: 1.8% 1.8% of net sales 150 6% 1.7% (1.7% in same period 2021) 100 4% 1.1% 152 135 50 95 111 111 2% 72 77 77 48 0 0% Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2020 2020 2021 2021 2021 2021 2022 2022 2022 R&D 1.9 % 150 6% ▪ Q3 202
Slide 34: Debt Maturity Profile and Leverage
DEBT MATURITY PROFILE AND LEVERAGE Debt maturity profile, SEK m USD loans EUR bonds EKN loan SEK bond 1.000 ▪ Well diversified profile 2.000 ▪ Average maturity 3,0 years ▪ Undrawn revolving credit facility of EUR 200 m 3.277 3.713 3.277 3.277 2.340 2022 2023 2024 2025 2026 2027 2028 Net debt / EBITD
Slide 35: Q3 Summary
Q3 SUMMARY Business highlights ▪ 37% sales growth supported by Igloo and Mobile Power Solutions ▪ Challenging market ▪Complex macro environment ▪Continued decline in RV OEM ▪Gradual recovery in Service & Aftermarket coming quarters ▪Stable development in Distribution Strategic highlights ▪ Diversifi
Slide 36: Dometic
“> DOMETIC
Slide 37: Disclaimer
DISCLAIMER SOME STATEMENTS HEREIN ARE FORWARD-LOOKING AND THE ACTUAL OUTCOME COULD BE MATERIALLY DIFFERENT. IN ADDITION TO THE FACTORS EXPLICITLY COMMENTED UPON, THE ACTUAL OUTCOME COULD BE MATERIALLY AFFECTED BY OTHER FACTORS, (A) CHANGES IN ECONOMIC, MARKET AND COMPETITIVE CONDITIONS, (B) SUCCESS
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