Munters Group AB · OMXSTO:MTRS
Munters Group AB — Q4 2022 Earnings Presentation
30 slides from Munters Group AB's earnings presentation, February 2023
Slide 1: Q4 report 2022
Munters Q4 report 2022 Klas Forsstrém, President and CEO Annette Kumlien, GVP and CFO Ann-Sofi Jonsson & Line Dovarn, Investor Relations
Slide 2: A quarter with organic growth and strong underlying demand
A quarter with organic growth and strong underlying demand MsEK —— Order Intake MSEK Rider backlog MSEK Adj. EBITA Adj, EBITA margin 12.000 con 293 304 0, 300 272 6000 10.000 245 259 16% 8.000 son 198 215 217 99) 14% 4000 200 o 129 6000 ° o ° i + 10% 2.000 4000 100 8% 2.000 6% 0 0 0 4% @4 Ql @2 G3 G
Slide 3: Q4 - strong growth in all regions
3 Q4 -— strong growth in all regions Regional share Order intake Q4 Net sales Q4 2d Americas - order intake Q4 * Airlech - good growth in mainly battery and Service * DCT - continued high demand from the colocation market with a larger enterprise order * FoodTech — growth within Digital Solutions an
Slide 4: PS/PP Al Paper
• • • PS/PP Al Paper • Steel • Coating Cu • • Other •
Slide 5: AirTech - Order intake strong in all customer segments
Airlech —Order intake strong in all customer segments Market Outlook * Customer segme: Industrial ...whereof battery ... whereof food processing ..whereof other Components * * Clean Technologies Commercial Services FY 2022 59% 37% oe 7% 15% 1% 6% 4% 20% aV¥ ayy * Market outlook and comments are indi
Slide 6: Munters acquires Hygromedia and Rotor Source
Munters acquires Hygromedia and Rotor Source * Hygromedia LLC - manufacturer of desiccant dehumidification media. Specializes in components, supplying desiccant rotor manufacturers in the US, Europe & Asia * Rotor Source Inc. - supplier of rotors and cassettes to original equipment manufacturers (OE
Slide 7: Strong service growth in 2022
Strong service growth in 2022 Ambition: Share of service long-term to represent 30 percent of Group net sales » Airlech — generates majority of Service net sales * DCT = minor Service sales, as main part of business Greenfield installations Service development % of net sales . . 15% a Not reported a
Slide 8: Q4 - Good growth in the battery segment
Q4 — Good growbth in the battery segment “The two orders received in Q4 confirm our strategy and purpose - for customers’ success and contributing to a sustainable society” » Climate control systems to a multinational automotive manufacturer » combined value of MUSD 54 (~ MSEK 560) » includes system
Slide 9: Data Center Technologies - strong demand in colocation
9 Data Center Technologies — strong demand in Colocation Customer Segments Hyperscalers Colocation Telco & enterprises % order intake = Market FY 2022 Outlook * 5% = 93% ya 2% ) * Market outlook and comments are indicative and refer to the coming six months Comments Increase in cloud traffic and con
Slide 10: Customer rescopes data center projects and design
10 Customer rescopes data center projects and design Order cancellation for DCT in Q4: DCT cancellation for orders received during 2022 * Cancelled: evaporative cooling solutions, ~MSEK 465 Cancellation caused by whole project being stopped or redirected, not related to Munters as a specific supplie
Slide 11: Technology shift ongoing in the cooling market
n Technology shift ongoing in the cooling market DataCenter Magazine: “Munters has a pivotal impact on the sustainability of the entire industry at large” nt SyCool Split system uses zero Our highly energy-effi. water. The product won Mission Critical’s Top Tier Product Award for Thermal Management
Slide 12: FoodTech - Challenging market
FoodTech — Challenging market O18 Bos % order intake Market Customer segment FY 2022 look * Climate Solutions 77% _..whereof Broiler 46% A ... whereof Swine 13% SY ...whereof Layer 9% ...whereof Greenhouse 5% A whereof Dairy 4% Digital Solutions 23% ra * Market outlook and comments are indicative an
Slide 13: FoodTech on a challenging market
13 FoodTech on a challenging market & DIGITAL SOLUTIONS € CONTROLLERS: & SENSORS: CLIMATE SOLUTIONS. EQUIPMENT *ARR = Annualized Recurring Revenues Americas: stable situation with pockets of growth for equipment, strong growth for DS EMEA: Weak market due to war in Ukraine & inflationary pressure AP
Slide 14: Order signed with a large poultry producer
Order signed with a large poultry producer » MTech Systems within FT secured an important Software- as-a-Service (SaaS) contract with one of North America’s largest poultry producers » The order has a value of MUSD 4.3 (~ MSEK 46) » MTech Systems will deploy the Amino platform, its newest and most i
Slide 15: Our purpose - For customer success and a healthier planet
Our purpose - For customer success and a healthier planet CDP rating B (2021:¢) Allbright Even gender distribution in mgmt team placed us on the Greenstock Exchange List Financial figures Dec 2022 * Reported in accordance to GHG Protocol Renewable electricity Total Recordable Incident rate (TRIR) En
Slide 16: Munters focus areas
16 Munters focus areas ILLUSTRATIVE Direction of long-term positioning - 2023 and beyond Profitability FoodTech Digital Solutions Data Center Technologies Growth Growth Profitability Stability Focus areas 2023 and beyond AirTech * Continued progression on profitable growth * Service & energy efficen
Slide 17: Financial highlights
Financial highlights
Slide 18: Record strong growth and stable margin
Record strong growth and stable margin Mid-term Q4 ey FY targets 2021 yyy 2021 Net sales growth Org. growth p.a. over a 10% 10% 26% 10% business cycle Adjusted EBITA- . >14% 10.6% Mileme4 12.1% margin OWC/ret sales* 13-10% 13.1% [pea 13.1% * Average OWC (Operating Working Capital) last twelve months
Slide 19: Strong organic net sales growth & underlying demand
Strong organic net sales growth & underlying demand Q4 comments: Change (%) * O| strong (+20% FX-adj. excl. DCT cancellation): CH Aer) || CH zierA) rowth = AT strong, 2 large battery orders . us een = DCT underlying good demand excl. cancelled orders Ouutertittels SKS 2(S05 i 2 " PSEA 2-018 " FT, Ch
Slide 20: Increased investments in digitization and automation
Increased investments in digitization and automation Group adj. EBITA margin impact 2021 adj. EBITA % Q4 10.6 Volume Net pricing Operational challenges Supply chain Investments Business & regional mix ++ ++ 2022 adj. EBITA % 20 10.1 Main factors affecting adj. EBITA margin in Q4: * Positive impact f
Slide 21: Strong growth in Battery & Services
Strong growth in Battery & Services Q4 comments: * Ol increased in all regions = Battery strong all regions, especially Americas (2 large + 32 8 orders, MUSD 54) Order intake 2,642 1,749 1 1 8,399 | 5,842 ® Services good growth, mainly Americas Order backlog 4,698 | 2,796 4,698 | 2,796 3 Net sales 2
Slide 22: Strong net sales growth, driven by colocation in Americas
Strong net sales growth, driven by colocation in Americas Q4 comments: Q4 @4 Q k 9 2022 2021 Organic a * Ol increased +6% FX-adj., excl. cancellation of MSEK f MSEK 465* Order intake 30 361 131 9 31 6,245 | 1,051 * Excl. cancellations both Americas & EMEA grew Order backlog 5,937 703 5,937 | 703 ° N
Slide 23: Stable net sales in challenging markets
Stable net sales in challenging markets Q4 comments: * O! declined = EMEA & China continued weak markets = Americas grew: DS*up, CS** flat * NS declined * Price increases ~8% of FT net sales = Americas: DS growth, CS flat with growth in broiler & layer = EMEA declined due to the overall weak market
Slide 24: Leverage
Leverage Strong focus on cash flow management OWC/net sales Cash flow development, LTM* Development of leverage x“ sek Cash flow forthe period Net debt / adi, EBITDAx, LTM 1s 1200 — Cash flow from operating 4 activities ce ano 19 fnoncoltorastconge19:10% _ 400 2 5 0 1 -400 8 a we +800 ° rae Parti Ha
Slide 25: Increasing investments to capture market opportunities
25 Increasing investments to capture market opportunities Commercial excellence Digitalization Innovation Manufacturing excellence Investing in people 2022 Increased corporate costs: + ERP project * Rollout of HCM system Create a scalable business to capture growth and become more efficient and prof
Slide 26: Measures for strategy implementation on track
Measures for strategy implementation on track ~ * Strategy implementation measures Realized costs and expenses of about MSEK 180 Approx. 75% of savings realized Implementation according to plan, finalization in Q1 2023 All implementations initiated and will be closed during the year < (S) * Total co
Slide 27: Inorganic strategies to boost overall growth
27 Inorganic strategies to boost overall growth Core / Consolidation Technology / Digital Services - String of pearls 2 3 3 2 & ” 2 5 D 2 fo] 8 4 < 8 = New growth areas * subject to certain corporate and regulatory approvals **|Perighs- Intellectual property rights 2017-2022 Gearing for new growth c
Slide 28: Summary
Summary
Slide 29: 2022 - Delivering on strategy with record growth
2022 — Delivering on strategy with record growth Strong demand resulting in record order backlog and very strong organic growth Increased capacity to meet growing demand today and in coming years Continued investments in digitization and automation & growth by acquisitions 29
Slide 30: Questions & Answers
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