TKH Group N.V. Cert · EURONEXT:TWEKA
TKH Group N.V. Cert — TKH Group — Investor Presentation (April 2023)
46 slides from TKH Group N.V. Cert's investor presentation, April 2023
Slide 1: TKH Group NV Investor Presentation April 2023
TKH GROUP NV INVESTOR PRESENTATION APRIL 2023
Slide 2: Key messages
Key messages TKH strategy continues to deliver in Q1 2023 – organic growth in turnover and EBITA, orderbook up Strong results in 2022 – turnover (+18.0%), EBITA (+23.9%), order intake (€ 2,042 million) Focus on megatrends automation, digitalization, and electrification drives strong performance Well
Slide 3: Content
Content 1 Profile 2 Accelerate 2025 Strategy Program 3 Track Record 4 Highlights Q1 2023 Market Update 5 Reporting Segments 6 2022 Results & Financial Performance 2022 7 Outlook 3 TKH INVESTOR PRESENTATION - APRIL 2023
Slide 4: Profile
PROFILE
Slide 5: TKH – Technology leader in high growth markets
TKH – Technology leader in high growth markets SMART Technologies built on innovation Together with our customers, we develop innovative technologies that make the world more efficient and more sustainable SMART VISION SYSTEMS SMART MANUFACTURING SYSTEMS SMART CONNECTIVITY SYSTEMS TKH WORLDWIDE NORT
Slide 6: Smart Technologies
Smart Technologies Specialized in the development of innovative, client-centric systems that drive success in automation, digitalization, and electrification By integrating hardware, software, and customer-focused insight, our smart technologies provide unique answers to client challenges Creating o
Slide 7: Built on innovation
Built on innovation Innovations as % of turnover 30% OF OUR TECHNOLOGY MORE THAN 15% PROPOSITION IS TURNOVER REALIZED 25% SOFTWARE DRIVEN HONDERDEN BY INNOVATIONS 20% 20.6% 15% Innovations: defined as technologies introduced in last 24 months 10% 5% >750 FTE IN R&D AND 0% 2012 2013 2014 2015 2016 20
Slide 8: In high growth markets
In high growth markets Ratio Job vacancies per unemployed (US & UK) LACK OF LABOUR 10 AUTOMATION PRODUCTIVITY RELIABILITY 5 UK Industry 4.0 – ‘hands-off, ACCURACY eyes-off’ manufacturing US 0 MOBILITY In billions Connected devices worldwide from 2022 – 2030 30 DIGITALIZATION SPEED CLOUD COMPUTING 20
Slide 9: Leading market positions
Leading market positions TKH SMART TKH SMART TKH SMART VISION SYSTEMS MANUFACTURING SYSTEMS CONNECTIVITY SYSTEMS VISION TIRE BUILDING ENERGY DIGITALIZATION 3D 2D Security Vision Offshore Onshore GEOGRAPHICAL MARKETS GLOBAL MARKET STRONG MARKET GLOBAL MARKET GLOBAL MARKET GROWING MARKET MARKET LEADER
Slide 10: Accelerate 2025 Strategy Program
ACCELERATE 2025 STRATEGY PROGRAM
Slide 11: Accelerate 2025: Roadmap to turnover and ROS target
Accelerate 2025: Roadmap to turnover and ROS target Unlocking the full potential of our leading technologies Areas Contribution to turnover Contribution to Commentary to 2025 targets target > € 2 billion ROS improvement target > 17% 1) Scale effect -due to organic growth- on opex and cost of ORGANIC
Slide 12: 2025 Growth Targets
2025 Growth Targets SMART VISION SMART MANUFACTURING SMART CONNECTIVITY Strategic Investment Organic Growth Plan Divestments Strategic Investment 2025 Organic Growth Plan Turnover Acquisitions > €2.0 bn Organic Growth ▪ Topline organic growth to continue ▪ Topline organic growth to continue ▪ Toplin
Slide 13: Priority on ESG
Priority on ESG Key non-financial KPIs CO2e FOOTPRINT % WASTE RECYCLING SATISFACTION SCORE CODE OF SUPPLY BEING RESPONSIBLE REDUCTION (scope 1 & 2) Target < 5% waste Customers Signed by suppliers of most relevant raw Compared to 2019 materials Target Average score above Target > 90% strategic suppli
Slide 14: Priority on ESG
Priority on ESG TKH has a broad portfolio of products and solutions that are aligned with the Sustainable Development Goals (SDGs) defined by the United Nations 68% of turnover linked to SDGs 14 TKH INVESTOR PRESENTATION - APRIL 2023
Slide 15: Executing on € 200m Strategic Investment Program
Executing on € 200 m Strategic Investment Program Securing additional capacity to benefit from megatrends resulting in additional € 250 - € 300 million turnover in coming years AUTOMATION DIGITALIZATION ELECTRIFICATION SMART MANUFACTURING SYSTEMS SMART CONNECTIVITY SYSTEMS Expansion Tire Building Sy
Slide 16: Capital allocation
Capital allocation New € 625m multicurrency committed credit facility (Feb-2023), linked to TKH's sustainability targets: € 500m Revolving Credit Facility, tenor Feb-2028 and two one-year extension options € 125m term loan, 3-year maturity CAPITAL EXPENDITURE ACQUISITIONS & DIVESTMENTS In million €
Slide 17: Track Record
TRACK RECORD
Slide 18: TKH's evolution into today's technology leader
TKH’s evolution into today’s technology leader DEVELOPMENT OF TURNOVER R&D EXPENDITURE In million € In million € 2.000 80 50% 1.800 70 48% 1.600 60 46% 1.400 1.200 50 44% 1.000 40 800 42% 30 600 40% 20 400 10 38% 200 0 0 36% 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Slide 19: Our track record
Our track record TURNOVER ROS ROCE DIVIDEND PER EARNINGS PER SHARE SHARE* in million € 2.000 14% 25% € 2,00 € 4,00 1.750 12% 20% € 3,00 1.500 € 1,50 10% 1.250 15% € 2,00 Proposed 8% 1.000 € 1,00 6% 10% 750 € 1,00 4% 500 € 0,50 5% 250 2% € 0,00 0 0% 0% € 0,00 2002 2012 2022 2002 2012 2022 2002 2012 2
Slide 20: Highlights Q1 2023
_ HIGHLIGHTS Q1 2023
Slide 21: Q1 2023 Update
Q1 2023 UPDATE DEVELOPMENTS IN LINE WITH EXPECTATIONS Turnover € 472.5m EBITA € 60.4m All segments recorded growth in turnover. Turnover in Q1 2023 increased by 8.2%; Adjusted for currency 2022: € 436.7m 2022: € 58.5m effects, turnover increased by 8.1% + 8.1% organically + 3.3% Strong EBITA growth
Slide 22: Reporting Segments
REPORTING SEGMENTS
Slide 23: Smart Vision systems
Smart Vision systems (in million € Q1 2023 vs 2022 AND Q1 2023 SMART VISION SYSTEMS RESULTS unless stated otherwise) 2022 2021 Δ in % Q1 2022 Turnover 499.7 429.8 + 16.3% + 14.4% 2D MACHINE VISION – Strong growth in 2022; Significant contribution in 2022 from Alvium portfolio (embedded vision platfo
Slide 24: Smart Vision systems
Smart Vision systems GROWTH DRIVERS MARKETS (amounts in billion €) MARKET POSITIONS SECURITY VISION 2D & 3D MACHINE VISION 3D MACHINE VISION 2D & 3D MACHINE VISION 11.6% Automation, reshoring, lack of human CAGR resources, rising costs, quality control 29.5 Consumer Battery SECURITY VISION 0.5 7.6 %
Slide 25: Smart Manufacturing systems
Smart Manufacturing systems (in million € Q1 2023 2022 AND Q1 2023 SMART MANUFACTURING RESULTS unless stated otherwise) 2022 2021 Δ in % vs Q1 2022 Turnover 491.2 419.1 + 17.2% + 0.7% TIRE BUILDING SYSTEMS – In H2 2022 shortages of critical components resulted in operational inefficiencies from dela
Slide 26: Smart Manufacturing systems
Smart Manufacturing systems GROWTH DRIVERS MARKET DRIVERS MARKET POSITIONS TIRE BUILDING TECHNOLOGY Re- TIRE BUILDING TIRE BUILDING shoring, demand for small production Increasing number of units in stock with 7% 1 2 Increased complexity: continuous increase batch sizes, accelerating pace of CASES a
Slide 27: Smart Connectivity systems
Smart Connectivity systems (in million € Q1 2023 vs 2022 AND Q1 2023 SMART CONNECTIVITY RESULTS unless stated otherwise) 2022 2021 Δ in % Q12022 Turnover 848.6 692.3 + 22.6% + 12.2% ENERGY – In 2022, increased production volumes from additional production capacity for medium-voltage energy cables (o
Slide 28: Smart Connectivity systems – Digitalization
Smart Connectivity systems – Digitalization PROPOSITION MARKET MARKET POSITIONS DIGITALIZATION Fibre Optics DIGITALIZATION DIGITALIZATION connectivity systems - Turnkey cable % of homes passed systems, Closures, Street cabinets, Belgium 12% Access chambers, Multi tube cables, Germany 22% UK 27% Rack
Slide 29: Smart Connectivity systems – Electrification
Smart Connectivity systems – Electrification PROPOSITION MARKETS MARKET POSITIONS ELECTRIFICATION Offshore turnkey ONSHORE ONSHORE high voltage array cabling and accessories, Onshore turnkey medium Threat of transport limitation and high voltage energy cable systems MARKET LEADER Offshore GRWOING MA
Slide 30: Annual Results 2022
ANNUAL RESULTS 2022
Slide 31: Delivering value in 2022
Delivering value in 2022 Turnover € 1,817 m EBITA € 234.8 m ROS 12.9% Normalized net profit 2021: € 1,524 m 2021: € 189.6 m 2021: 12.4% € 143.6 m +18.0% organically +23.9% 2021: € 113.9 m +26.1% ROCE 23.2% Order book € 971.9 m Innovations 20.6% Dividend proposal 2021: 20.5% 2021: € 746.6 m 2021: 19.
Slide 32: Developments
Developments Order intake +10.9% to all-time high of € 2,042 million (2021: € 1,842 million) Record order intake € 695 million at Smart Manufacturing systems Turnover up 19.2% Organically +18.0% including price effects of +7.6%, and currency effect +1.2% All segments contributed ROS expanded to 12.9
Slide 33: Executing on our Accelerate 2025 strategy program
Executing on our Accelerate 2025 strategy program Financial performance Sustainability KEY FINANCIAL TARGETS KEY NON-FINANCIAL TARGETS Turnover ROS ROCE Carbon footprint * % Female ** Accident rate (LTIFR) Realized 2022 € 1,817 million 12.9% 23.2% 42.7% 18.4% 0.8 Targets 2025 > € 2 billion by 2025 >
Slide 34: Financial Performance 2022
FINANCIAL PERFORMANCE 2022
Slide 35: Statement of profit & loss
Statement of profit & loss in million € unless stated otherwise 2022 2021 Δ in % Geographical distribution of turnover Turnover 1,816.6 1,523.8 + 19.2% Added value 857.9 47.2% 736.5 48.3% + 16.5% Operating expenses 623.1 34.3% 546.9 35.9% + 13.9% EBITA 234.8 12.9% 189.6 12.4% + 23.9% One-off income
Slide 36: Statement of profit & loss
Statement of profit & loss in million € unless stated otherwise 2022 2021 Δ in % Significant turnover growth of +19.2% Turnover 1,816.6 1,523.8 + 19.2% In million € 1.900 1.816,6 274,7 1.800 Added value 857.9 47.2% 736.5 48.3% + 16.5% 1.700 Operating expenses 623.1 34.3% 546.9 35.9% + 13.9% 1.600 18
Slide 37: Statement of profit & loss
Statement of profit & loss in million € unless stated otherwise 2022 2021 Δ in % Gross margin decreased to 47.2% (2021: 48.3%) Turnover 1,816.6 1,523.8 + 19.2% Shift in product mix Passed on higher prices for raw material and components, lowering added Added value 857.9 47.2% 736.5 48.3% + 16.5% val
Slide 38: Statement of profit & loss
Statement of profit & loss in million € unless stated otherwise 2022 2021 Δ in % EBITA +23.9% Turnover 1,816.6 1,523.8 + 19.2% Smart Vision systems +29.5% Smart Manufacturing system +16.3% Added value 857.9 47.2% 736.5 48.3% + 16.5% Smart Connectivity systems +19.3% Operating expenses 623.1 34.3% 54
Slide 39: Statement of profit & loss
Statement of profit & loss in million € unless stated otherwise 2022 2021 Δ in % One-off income Turnover 1,816.6 1,523.8 + 19.2% Mainly related to divestment of real estate held for sale Added value 857.9 47.2% 736.5 48.3% + 16.5% Amortization Operating expenses 623.1 34.3% 546.9 35.9% + 13.9% Certa
Slide 40: Balance sheet
Balance sheet (in € million) 31-12-2022 31-12-2021 (in € million) 31-12-2022 31-12-2021 Intangible assets and goodwill 533.8 537.1 Shareholders' equity 786.8 721.9 Property, plant and equipment 295.0 222.5 Non-controlling interests 0.1 0.1 Right-of-use assets 75.3 68.8 Total group equity 786.9 722.0
Slide 41: Working capital
Working capital Changes in working capital In million € Breakdown of the increase 40 38 35 30 20 10 0 Inventories Contract assets Receivables Payables -10 -10 -1 Working capital as percentage of turnover increased to 14.1% (December 31, 2021: 10.7%) Use of non-recourse factoring December 31, 2022 €
Slide 42: Net debt development
Net debt development Change in net debt Strong positive cash flow from operations, although impacted by increase In million € in working capital Investments in property, plant, and equipment of € 91.8 million, mainly in: € 41 million in Strategic Investment Program Expansion, replacement and upgrade
Slide 43: Free cash flow
Free cash flow H1 H2 FCF conversion can be affected by developments in working capital. Working capital ratio for the periods in million € unless stated otherwise 2022 2022 2022 2021 2020 2019 included in the overview are: Operating result 97.8 92.4 190.2 136.9 70.9 108.0 2019: 13.0% Depreciation, a
Slide 44: Outlook
OUTLOOK
Slide 45: Outlook
Outlook The favorable market conditions for our leading technologies, underlined by our Smart Connectivity systems strong order book and our capacity expansions, lead to a positive outlook for On balance, turnover and EBITA will grow organically, despite start-up costs our businesses. We expect tota
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