Slide 1: IR presentation Q3 March 2022
Flügger IR presentation Q3 March 2022
Slide 2: Flügger Management team
Flügger Management team The management team of Flügger Sune Schnack, CEO Poul Erik Stockfleth, CFO Ulf Schnack, CDO Previous experience Previous experience Previous experience 2
Slide 3: Flügger at a glance
Flügger at a glance Key LTM figures Q3 21/22 Flügger’s Business model Revenue mDKK EBIT mDKK Production Sales channels Customers Own stores 2,454 180 Franchise stores BtB E-commerce R&D BtC Full-time employees Markets DIY etc. 2,355 17 Brand examples End of Q3 21/22 Segment 1 No. factories No. store
Slide 4: Flügger is an international player within decorative coatings
Flügger is an international player within decorative coatings Largest west markets (revenue DKKm) Largest east markets (revenue DKKm) Denmark = share of Russia Flügger revenue 795 171 #1 #2 #3 #1 #2 #3 Sweden Estonia 604 50 #1 #2 #3 #1 #2 #3 Norway Ukraine 239 117 #1 #2 #3 #1 #2 #4-5 Poland Belarus
Slide 5: Lithuanian partner becomes part of Flügger group A/S
Lithuanian partner becomes part of Flügger group A/S Business overview Shop photo • Revenue in 2021 of 4.3m EUR • 4 own stores in Vilnius and Klaipeda incl. webshop plus network of 21 partner stores • Large warehouse in Vilnius expected to be extended in 2023 • 14 fulltime employees Own stores Partn
Slide 6: Intensifying strategic initiatives will drive profitable growth & efficiency
Intensifying strategic initiatives will drive profitable growth & efficiency Key strategic initiatives towards an EBIT of 350 mDKK in 2023/24 Key strategic targets towards 2023/24 1 VALUE BASED PRICING Optimization of pricing across product and segments as well as focusing on margin enhancing initia
Slide 7: Q3 21/22 Highlights
Q3 21/22 Highlights Revenue (mDKK) EBIT (mDKK) Own & franchise stores (#) 18% -1% n.m. 511 0 373 371 434 230 241 Own stores 143 130 Franchise Q3 20/21 Q3 21/22 -39 Q3 20/21 Q3 21/22 Q3 20/21 Q3 21/22 Gross Margin (%) EBIT-margin (%) ROCE (%) -11.6pp -7.7pp -8.4pp 55.0 0.1 20.8 43.4 12.4 Q3 20/21 Q3
Slide 8: YTD 21/22 Highlights
YTD 21/22 Highlights Revenue (mDKK) EBIT (mDKK) Own & franchise stores (#) 18% -1% -24% 1,904 200 373 371 1,612 152 230 241 Own stores 143 130 Franchise YTD Q3 20/21 YTD Q3 21/22 YTD Q3 20/21 YTD Q3 21/22 YTD Q3 20/21 YTD Q3 21/22 Gross Margin (%) EBIT-margin (%) ROCE (%) -5.6pp -4.4pp -8.4pp 56.4 5
Slide 9: Q3 21/22 highlights – Satisfactory sales performance
Q3 21/22 highlights – Satisfactory sales performance. Results remained impacted by increased prices on raw materials, energy & distribution Flügger Group Results Sales up 74mDKK driven by Eskaro mDKK Q3 21/22 Q3 20/21 Change ▪ The Q3 financial result was not impacted by the conflict Net sales 511 43
Slide 10: YTD 21/22 highlights – Sales growth driven by acquired activities
YTD 21/22 highlights – Sales growth driven by acquired activities. Earnings reflect the accelerated cost increases & supply challenges Flügger Group Results Sales growth driven by acquired activities mDKK YTD Q3 21/22 YTD Q3 20/21 Change ▪ Overall sales performance as expected, driven by the Net sal
Slide 11: Net sales increased 18% YTD, driven by acquisition of Eskaro and Malgodt.dk
Net sales increased 18% YTD compared to last year, driven by the acquisition of Eskaro and Malgodt.dk Group sales development Net Sales Net Sales Net sales mDKK LTM mDKK mDKK 750 2.700 1.904 700 16 2.400 650 600 2.100 291 550 1.800 500 1.612 17 450 1.500 400 1.200 350 300 900 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
Slide 12: EBIT impacted significantly by increased raw material prices
EBIT impacted significantly by increased raw material prices, in addition to higher costs related to distribution and energy Group EBIT development EBIT mDKK EBIT mDKK 150 250 200 200 100 150 31 50 100 0 50 17 6 5 152 1 0 -50 -50 -100 -100 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
Slide 13: Segment 1 Own Stores & Resellers: Q3 organic growth
Segment 1 Own Stores & Resellers: Q3 organic growth is mainly impacted by the normalization of sales following the Covid-19 effect in 21/22 Sales development by geographical segment ▪ Positive currency effect of 1%. Negative Organic Reported Revenue (mDKK) Q3 20/21 Currency M&A Q3 21/22 development
Slide 14: Segment 2 DIY: Q3 21/22 impacted by normalization in sales to consumers
Segment 2 DIY: Q3 21/22 mainly impacted by normalization in sales to consumers Sales development by geographical segment ▪ Sales to private label in DIY stores were Organic Reported Revenue (mDKK) Q3 20/21 Currency M&A Q3 21/22 back at normalized level compared to Growth Growth very high demand in 2
Slide 15: Segment 3 Eskaro Group AB: Q3 revenue 75mDKK
Segment 3 Eskaro Group AB: Q3 The acquisition of Eskaro generated 75mDKK in revenue in Q3 21/22 Sales development by geographical segment ▪ Revenue in segment 3 is solely Organic Reported Revenue (mDKK) Q3 20/21 Currency M&A Q3 21/22 generated by the acquisition of Eskaro Growth Growth and includes
Slide 16: Segment 1 Own Stores & Resellers: YTD organic growth
Segment 1 Own Stores & Resellers: YTD organic growth mainly impacted by normalization of Consumer segment and growth with the professionals Sales development by geographical segment ▪ Overall positive currency impact, as YTD Q3 Organic YTD Q3 Reported Revenue (mDKK) Currency M&A currency headwind in
Slide 17: Segment 2 DIY: YTD 21/22 impacted by normalization
Segment 2 DIY: YTD 21/22 mainly impacted by normalization in sales to consumers Sales development by geographical segment ▪ Sales to private label in DIY stores were YTD Q3 Organic YTD Q3 Reported Revenue (mDKK) Currency M&A back at normalized level compared to 20/21 Growth 21/22 Growth very high de
Slide 18: Segment 3 Eskaro Group AB: Revenue of 304mDKK YTD
Segment 3 Eskaro Group AB: The acquisition of Eskaro generated Revenue of 304mDKK YTD 21/22 Sales development by geographical segment ▪ Revenue in segment 3 is solely YTD Q3 Organic YTD Q3 Reported Revenue (mDKK) Currency M&A generated by the acquisition of Eskaro 20/21 Growth 21/22 Growth and inclu
Slide 19: NIBD impacted by the acquisition of Eskaro
NIBD impacted by the aquisition of Eskaro. Balance sheet remains a solid foundation for further possible acquisitions Financial solidity NIBD* mDKK Equity ratio % 300 100% 250 200 50% 1 Balance sheet remains very solid with an equity ratio above 45% since 19/20 despite large acquisition 150 0% 100 2
Slide 20: Earnings increase with stock price keeping price/earnings stable around 13x
Earnings increase with stock price keeping the price/earnings stable around 13x Development in price/earnings and stock price (DKK) Stock price incl. reinvested dividends (DKK) 100 900 800 80 78x 700 600 60 500 400 40 37x 30x 300 27x 19x 21x 200 20 14x 13x 13x 13x 14x 13x 100 0 0 12/13 13/14 14/15 1
Slide 21: Share price development
Share price development Flügger’s share price development Benchmarking to other industry players (indexed) Share price Price indexed 800 Share price (DKK) 160 Flügger Volume (# of shares) 140 Akzo Nobel 700 120 PPG Sherwin Williams 100 600 Tikkurila 522 80 Tikkurila acquired by PPG (announced 18/12-
Slide 22: Return on Capital Employed is diluted by the acquisition of Eskaro
As expected, the Return on Capital Employed is diluted by the acquisition of Eskaro Financial solidity ROCE, % EBIT Margin,% 25% 12% 10% 20% 8% 1 Q3 21/22 EBIT Margin (%) remains solid as expected after normalization of sales and increase in raw materials 15% 6% 4% 2 ROCE in 21/22 is diluted by the
Slide 23: Guidance for 2021/22 – Overall EBIT guidance suspended
Guidance for 2021/22 – Overall EBIT guidance suspended. EBIT guidance for segment 1 and 2 of 200m-220m maintained Selected financial metrics (DKK) for 2021/22 Key drivers for guidance • Earnings generally impacted by higher prices on raw materials Revenue 2,500m – 2,600m and transport, which are pus
Slide 24: Segment 3 – Eskaro impacted by the conflict in Ukraine
Segment 3 – Eskaro impacted by the conflict in Ukraine Risk & uncertainties Status Amount at risk The conflict in Ukraine did not impact the Q3 result but will impact the full year financial results for 21/22. Eskaro group Annual revenue +400 mDKK Eskaro comprises employees, production and sales act
Slide 25: Thank you for listening
Thank you for listening Please contact IR@flugger.com for any further questions or visit flugger.com/investor Q&A 25 25