Ctt Systems Ab · OMXSTO:CTT
Ctt Systems Ab — ABG Sundal Collier Investor Presentation (September 2019)
30 slides from Ctt Systems Ab's conference presentation, Sep 4, 2019
Slide 1: Investor Presentation
INVESTOR PRESENTATION CTT SYSTEMS AB TORBJÖRN JOHANSSON, CEO ABG - SEPTEMBER 4, 2019
Slide 2: We solve the humidity paradox in aircraft
We solve the humidity paradox in aircraft Too Too drydry in the cabin Too wet Too wet in the aircraft fuselage – cabin air is far more – moisture and water dehydrating environment accumulation from condensate than any place on Earth. water
Slide 3: We provide products for humidity control
We provide products for humidity control ❑ Restored humidity to ground-like level in the cabin for your wellbeing ❑ Lowering excess weight cutting fuel / CO2 footprint for our climate De-Humidifiers Humidifiers
Slide 4: CTT at a glance
CTT at a glance 37 % 60 % ❑ Founded in 1991 ❑ HQ in Nyköping, Sweden ❑ Production in Nybro, Sweden ❑ 110 employees, ~70 in Nyköping ❑ Listed on Small Cap 62 % Nasdaq Stockholm 34% ❑ Market Cap approx. 2bn SEK 66% Aftermarket First Sales 4
Slide 5: Market position and customers
Market position and customers Humidifiers De-Humidifiers 50+ 50+ 787 AIRLINES ❑ Sole OEM supplier - Strong 3 ACTIVE ALL- market position ❑ Diversified customer base NARROW BODY ❑ Flight Deck emerging as de facto standard on long-haul ❑ Underlying trends supportive aircraft. Migrating to cabin. ❑ No
Slide 6: Strong underlying market - Fleet forecasted to double in 20 years
Strong underlying market - Fleet forecasted to double in 20 years ❑ Commercial aviation resilient long-term growth ❑ Growing middle-class in emerging markets ❑ Globalization and urbanization Further tensions in geopolitics and trade could affect outlook negatively if escalating
Slide 7: The Humidifier Business
THE HUMIDIFIER BUSINESS
Slide 8: Humidifier Onboard closes the wellbeing gap
Humidifier Onboard closes the wellbeing gap Inflight Humidification IFH maintains air humidity at ground-like levels (22 % RH) Elevates cabin climate and cabin performance to better match earthlike conditions - during the entire flight ❑ Flight Deck – Established product – High penetration on multip
Slide 9: Focus on wellbeing and sensory experience drives demand
Focus on wellbeing and sensory experience drives demand
Slide 10: Point-to-point expansion drives demand
Point-to-point expansion drives demand Shortens travel time but extends range / flight time – drives demand for better climate / humidity
Slide 11: 787 leads the way - High CTT shipset content
787 leads the way - High CTT shipset content CTT has on average 2.2 humidifiers on all Dreamliners – 85 % flight deck selection rate Boeing delivered the 787th Dreamliner during 2018 Since its first delivery in September, 2011, the 787 family has flown nearly 300 million passengers on more than 1.5
Slide 12: Airlines mirror 787-selection on new platforms
Airlines mirror 787-selection on new platforms Commonality demand: Airlines select humidifiers in flight deck and crew rest on A350 and 777X Air China first A350 delivered in August 2018 China Eastern first A350 in November 2018 787- mirroring its 787 fleet: Humidifiers in flight deck equipped with
Slide 13: Diversified and global humidifier customer base
Diversified and global humidifier customer base 7% United Airlines ❑ More than 50 airline customers 7% American Airlines ❑ 10 Largest Airlines account for 55 % Japan Airlines ❑ 40+ Airlines account for remaining 45 % 7% Hainan Airlines ❑ Strong position in China with all major 45% Air Canada airline
Slide 14: Growth drivers – OEM expansion & retrofit
Growth drivers – OEM expansion & retrofit ❑ Product content available on more aircraft platforms Optional ❑ More options available - Higher average aircraft shipset value humidifiers ❑ Retrofit demand when harmonizing the experience (OEM drives refurbish per shipset upgrades on existing fleet) A350
Slide 15: Installed base drives the aftermarket
Installed base drives the aftermarket OEM Deliveries 25 % Humidifier Units ❑ Aftermarket is driven by humidifier population ❑ Record-High Humidifier deliveries in 2018 ❑ Population at airlines growing 33 % 2014-2018 2014 2015 2016 2017 2018
Slide 16: The De-Humidifier Business
THE DE-HUMIDIFIER BUSINESS
Slide 17: Dehumidifier Checkmates Fuselage Condensation
Dehumidifier Checkmates Fuselage Condensation ❑ Niche market ❑ Strong foothold in Northern Europe / Russia ❑ BFE on Boeing 737-800 ❑ Standard equip on Boeing 787 – De-selected from 2020 The Zonal Drying™ system can cut 200 -300 kg of excess weight in Boeing 737-800/A320 aircraft; generating the foll
Slide 18: Fuselage condensation on every flight
ON EVERY FLIGHT FUSELAGE CONDENSATION IN ALL AIRCRAFT
Slide 19: How to cut 200+ kg? Add kg!
HOW TO CUT 200+ KG? ADD 25 KG!
Slide 20: Supporting Trends
SUPPORTING TRENDS NOX EVERY KG COUNTS CO2 ❑ ❑ ❑ High-density cabin layouts gain traction Longer flights (more flight hours) Sustainability pressure - Stakeholders requiring airlines to take more measures in order to reduce CO2 / NOX.
Slide 21: "Eien ig coal
"Eien ig coal °° > a .
Slide 22: Targeting A320neo and Boeing 737MAX
Targeting A320neo and Boeing 737MAX Success Factors Strategy ❑ Zonal Drying™ market is limited until ❑ A321-trial systems catalogue status at MAX / neo ❑ Boeing 737MAX STC ❑ Retrofit drives OEM ❑ A320-family airlines to retrofit ❑ Key to win airline retrofit awards from ❑ Boeing 737-800 customers to
Slide 23: Financials / Outlook
FINANCIALS / OUTLOOK
Slide 24: Q3 Forecast
Q3 Forecast Net Sales forecasted to be 80 - 85 MSEK (81), same level as previous year 80 - 85 Q319E
Slide 25: Outlook Net Income (4Q Rolling)
Outlook Net Income (4Q ROLLING) 12-month rolling revenues (currency adjusted) at current levels or slightly lower for upcoming 4 – 6 quarters NET INCOME (ROLLING 4Q) 380 MSEK 360 Reasons for flattening curve: 340 • Strong comparing Quarter-On-Quarter 320 (QOQ) – Q3 and Q4 300 280 • The ZD de-select
Slide 26: Humidity control for a better climate.
0 Humidity control for a better climate. ” RH In the aircraft cabin and in the sky.
Slide 27: Stakeholders require airlines to reduce fuel burn / CO2 footprint
Stakeholders require airlines to take all measures to reduce fuel burn / CO2 footprint Excess weight leads to more fuel burn and unnecessary green gas emissions plus electrical failures, repair and mold problems.
Slide 28: Flight Deck, First Class, Business Class, Economy
25 12% 15 5% 7% 3% 5 Flight Deck First Class Business Class Economy
Slide 29: Emerging to business class – More optional sales / higher shipset value
Emerging to business class – More optional sales / higher shipset value First in Business Class 29
Slide 30: Q&A
Q&A
CTT Systems — ABG Sundal Collier Investor Presentation (September 2019) on 6ix