Krones Ag · XETR:KRN
Krones — Investor Day (September 2018)
36 slides from Krones's investor day presentation, Sep 18, 2018
Slide 1: KRONES Analyst Conference 2018
KRONES Analyst Conference 2018 September 18, 2018 in Freising
Slide 2: Beverage Market
Beverage Market
Slide 3: Market trends – customer related
3 ｜KRONES Analyst Conference 2018 Market trends – customer related Focus on and optimising of TCO Development in terms of beverages and Innovations Increasing consolidation influences the packaging units Digitalisation beverage industry Premium product vs. low cost product – Flexibility (e.g
Slide 4: Market – overview
4 ｜KRONES Analyst Conference 2018 Market – overview Population growth (UN, 2017) Middle class* 2010-2030 (OECD) Rising amount of SKUs Growth of global population by The middle class in Asia’s emerging Bottle sizes are no longer standardized – 80 million people per year markets will account for
Slide 5: Global economic trends give positive signals to the market
5 ｜KRONES Analyst Conference 2018 Global economic trends give positive signals to the market Global population and GDP both grow Global economic challenges for the beverage industry Scarcity of resources / climate change Population in bn GDP in bn USD Changes regarding availability, access and consu
Slide 6: Beverage consumption and market potential
6 ｜KRONES Analyst Conference 2018 Beverage consumption and market potential Global beverage consumption by industry (in bn litre) CAGR* CAGR 17/23 Beverage consumption CAGR 14/17 +2,8 % +2,0 % 1.346 Global: 1.135 211 1.070 196 +1,3% 62 198 -0,3% Beer 54 +2,2% 154 Wine/Spirits 53 +0,6% 138 +0,5% 140
Slide 7: Beverage consumption and market potential
7 ｜KRONES Analyst Conference 2018 Beverage consumption and market potential Global beverage market by packaging material (based on units filled) Share of packaging types 2017 Average annual growth of packaging types 2017-2020 6 5.2% 5 24.1% 4.2% 4 34.6% 3.1% 3 2.2% 2 1.4% 18.8% 1 11.0% 0 11.4%
Slide 8: PET in the market
PET in the market
Slide 9: Plastics heavily criticised – number of campaigns against use of plastic has increased strongly
9 ｜KRONES Analyst Conference 2018 Plastics heavily criticised – number of campaigns against use of plastic has increased strongly - Süddeutsche Zeitung, Jun 2018 - The Guardian, Jan 2018 - The New York Times, Mai 2018 - The Indian EXPRESS, Apr 2018 Plastic packaging material including PET is globall
Slide 10: Plastics heavily criticised – Krones solutions
10 ｜KRONES Analyst Conference 2018 Plastics heavily criticised – Krones solutions Risks Opportunities Solutions Country-specific ban on plastic EU measures Lightweighting Kenya as of 2018: Ban on plastic bags As of 2030: Recycling ratio for plastic 2014/2018: 10.9g / 9.9g – 0.5l - carb. (Vitaqua)
Slide 11: Society – drivers in plastic packaging recycling
11 ｜KRONES Analyst Conference 2018 Society – drivers in plastic packaging recycling Market Situation Stricter Legal Requirements Risks and Chances European Union Risk EU commission campaign to ensure ten PET related machine sales of KRONES at risk million tons of recycled plastics find their way i
Slide 12: Process Technology
Process Technology
Slide 13: Segment Process Technology
13 ｜KRONES Analyst Conference 2018 Segment Process Technology Segment Process Technology Breweries Intralogistics & Digitalization Breweries Softdrink and Dairies Units and Spirits Components Softdrinks Spirits Dairies Turnkey solutions Turnkey solutions, softdink Turnkey solutions, dairy Units for
Slide 14: Process Technology market and competition: Breweries
14 ｜KRONES Analyst Conference 2018 Process Technology market and competition: Breweries Market volume vs. KRONES OI group* – Brewery lines Total volume: approx. +1 EURbn average OI value 2015-2017 KRONES global market share 17% 2% 20% 28% Eastern Europe/ North America CIS Europe 24% China 30% 31% 19
Slide 15: Spotlight Breweries – order intake analysis
15 ｜KRONES Analyst Conference 2018 Spotlight Breweries – order intake analysis One third of our order intake volume provides insufficient profit Order intake volume 2017 by profit margin Conclusions Currently only two thirds of our volume seem to contribute to a sustainable breweries operation in
Slide 16: Global footprint for breweries set-up
16 ｜KRONES Analyst Conference 2018 Global footprint for breweries set-up Breweries today Breweries Blueprint Central organization Decentral organization Visa Visa Visa Visa Visa Local structures allow for a closer customer relationship and an improved cost base
Slide 17: Internationalization of Process Technology
17 ｜KRONES Analyst Conference 2018 Internationalization of Process Technology Geographically unbalanced ratio: sales vs. employees Employee split Process Technology 3% 3rd Country 21% 97% Germany 79% Dec 2015 Dec 2017 Sales split processing 9% 21% Germany 79% 3rd Country 91% Focus areas in short and
Slide 18: Levers to increase profitability
18 ｜KRONES Analyst Conference 2018 Levers to increase profitability Selective approach Localization of Further acquisitions & cost reduction brewery business and localization of remaining PT business Higher profitability
Slide 19: Hungary
i") nr 2 O ("4 =< ><
Slide 20: Greenfield plant of KRONES Hungary is going to have manufacturing and assembly
20 ｜KRONES Analyst Conference 2018 Greenfield plant of KRONES Hungary is going to have manufacturing and assembly of individual machines and components, with main volume in conveyor technology Product portfolio Flensburg Units Bottle Carrier CIP, mixer Pasteurizers, Checkmat Neutraubling Crate washe
Slide 21: Overall project on time and within budget, currently already strong focus on HR recruitment
21 ｜KRONES Analyst Conference 2018 Overall project on time and within budget, currently already strong focus on HR recruitment in Hungary Project / Ramp-up status Groundbreaking ceremony on 17th of July, 2018 started the construction phase Overall project within time schedule and within budget
Slide 22: Restructuring costs currently estimated at a small double digit EURm
22 ｜KRONES Analyst Conference 2018 Restructuring costs currently estimated at a small double digit EURm Impacted employees and potential measures € Semi-retirement Additional costs for semi- Severance payments retirement and settlement Qualifying payments will reduce EBT in 2018 External L
Slide 23: Working capital
Working capital
Slide 24: How Krones will achieve its growth targets
24 ｜KRONES Analyst Conference 2018 How Krones will achieve its growth targets TARGETS Working capital 2020 Revenue growth Balanced Receivables Inventories Payables down payments 7% EBT margin 8% Working capital 22% Working capital/revenue 22%
Slide 25: Working capital development Mid-term Target 22%
25 ｜KRONES Analyst Conference 2018 Working capital development Mid-term Target 22% Working capital ratio Working capital (€ million) 57 79 28.3% 29.0% 21 26.6% 81 1076 24.5% 997 27.0% DSO1 DIO2 DPO3 DP ratio1 22.4% 23.8% +7 days 0 days -14 days +8 days 2015 2016 2017 2018 31.12.2017 Accounts Invento
Slide 26: How we want to achieve our working capital target: Receivables and Inventories
26 ｜KRONES Analyst Conference 2018 How we want to achieve our working capital target of 22% Receivables DSO Inventories DIO ▪ Focus and inter- e.g.: We close our ▪ Disposition e.g.: Decreased nationalization of cash sites 3 days faster parameters optimized level of service and Short-term collection
Slide 27: How we want to achieve our working capital target: Payables and Pre-payments
27 ｜KRONES Analyst Conference 2018 How we want to achieve our working capital target of 22% Payables DPO Pre-payments DPR ▪ Prolongation of e.g.: We pay ▪ More and higher pre- e.g.: Always have 30% payment terms our suppliers payments from cash at start of Short-term ▪ “Hand over” project- 2 weeks l
Slide 28: Current situation and targets
Current situation and targets
Slide 29: Krones targets 2018
29 ｜KRONES Analyst Conference 2018 Krones targets 2018 Annual revenue EBT margin Working capital growth 6% 7.0% 28%
Slide 30: Our targets through 2020
30 ｜KRONES Analyst Conference 2018 Our targets through 2020 Annual revenue EBT margin Working capital growth 7% 8% 22%
Slide 31: EBT and EBITDA
31 ｜KRONES Analyst Conference 2018 EBT and EBITDA EBITDA as a key figure is independent from M&A and PPA transactions to better 305.3 320.8 reflect the cash relevant performance 340.2 9.6% 157.3 9.5% 9.2% 8.8% 9.2% Common key figure at the capital market, 223.3 237.6 258.8 making comparisons in
Slide 32: High cost pressure requires price increase and additional measures
32 ｜KRONES Analyst Conference 2018 High cost pressure requires price increase and additional measures Krones has raised prices on all machines for bottling and packaging equipment and for process technology by 4.5% on average for quotations since May 1, 2018 and is also adjusting its payment terms.
Slide 33: Questions and answers
33 ｜KRONES Analyst Conference 2018 Questions and answers ? …
Slide 34: 34 ｜KRONES Analyst Conference 2018
34 ｜KRONES Analyst Conference 2018
Slide 35: Financial calendar 2018/2019
35 ｜KRONES Analyst Conference 2018 Financial calendar 2018/2019 October 25, 2018 Conference Call Group Q3 2018 and Quarterly Statement as per September 30 February 21, 2019 Conference Call Preliminary Figures 2018 March 21, 2019 Annual Report 2018 April 30, 2019 Conference Call Group Q1 2019 and Ola
Slide 36: Disclaimer
36 ｜KRONES Analyst Conference 2018 Disclaimer This investor presentation contains forward-looking statements that are based on current estimates, forecasts and assumptions made by KRONES AG management to the best of its knowledge and other information currently available to KRONES AG. The forward-lo