Bekaert Sa · EURONEXT:BEKB
Bekaert Sa — FY2017 Earnings Presentation
30 slides from Bekaert Sa's earnings presentation, Feb 28, 2018
Slide 1: Slide 1
Slide 2: Annual results 2017
Annual results 2017 Presentation 28 February 2018 M. Taylor, Chief Executive Officer B. García-Cos, Chief Financial Officer
Slide 3: Bekaert delivers 10% sales growth and € 301 million underlying EBIT
Bekaert delivers 10% sales growth and € 301 million underlying EBIT - Consolidated sales of € 4.1 billion (+10%) and combined sales of € 4.8 billion (+11%) - Underlying gross profit of € 704 million (17.2% margin) compared with € 690 million (18.6% margin) in 2016 - Underlying EBIT of € 301 million
Slide 4: Consolidated sales FY2017
Consolidated sales FY2017 - 10% sales growth, driven by 9% organic growth - exceeding the € 4 billion consolidated sales mark for the first time in history Consolidated sales 2016 2017 Share Variance Organic FX M&A EMEA 1 148 1 273 31% +11% +11% - - North America 512 552 14% +8% +10% -2% - Latin Ame
Slide 5: Underlying EBIT performance
Underlying EBIT performance Underlying EBIT: € 301 million, down 1% from 2016 – with a margin of 7.3% The main factors contributing to the results were: + firm demand from automotive, industrial steel wire and construction markets; + better profitability in North America; + incremental benefits from
Slide 6: Consolidated income statement: key figures
Consolidated income statement: key figures Underlying Reported (in mio €) 2016 2017 2016 2017 Sales 3 715 4 098 3 715 4 098 Cost of sales (3 025) (3 394) (3 058) (3 396) Gross profit 690 704 657 702 − Sales growth of 10.3 % +3.4 % organic volume growth +5.5 % net of passed-on higher wire rod pri
Slide 7: Consolidated income statement: key figures
Consolidated income statement: key figures Underlying Reported (in mio €) 2016 2017 2016 2017 Gross profit 690 704 657 702 Selling expenses (175) (179) (176) (180) Administrative expenses (140) (162) (152) (164) R&D expenses (64) (63) (63) (63) Other operating revenue and expenses (7) 1 (7) 23 EBIT
Slide 8: Consolidated income statement: key figures
Consolidated income statement: key figures (in mio €) Underlying Reported 2016 2017 2016 2017 EBIT 305 301 260 318 EBIT margin 8.2% 7.3% 7.0% 7.8% EBITDA 513 497 481 510 EBITDA margin 13.8% 12.1% 13.0% 12.4% ROCE 11.8% 11.2% 10.0% 11.8% Underlying operating performance: − Underlying EBIT 1% down to
Slide 9: EBIT-underlying bridge
EBIT-underlying bridge In millions of € 10
Slide 10: Segment reporting: EMEA
Segment reporting: EMEA (in mio €) Underlying Reported 2016 2017 H1/2017 H2/2017 2016 2017 Consolidated sales 1 148 1 273 653 621 1 148 1 273 EBIT 141 141 81 60 136 144 EBIT margin 12.2% 11.1% 12.3% 9.7% 11.8% 11.3% Depreciation, amortization and 59 62 31 31 58 58 impairment losses EBITDA 200 203 11
Slide 11: Segment reporting: North America
Segment reporting: North America (in mio €) Underlying Reported 2016 2017 H1/2017 H2/2017 2016 2017 Consolidated sales 512 552 287 265 512 552 EBIT 26 33 21 13 26 33 EBIT margin 5.1% 6.0% 7.2% 4.8% 5.1% 6.0% Depreciation, amortization and 13 13 7 6 13 13 impairment losses EBITDA 39 47 28 19 39 47 EB
Slide 12: Segment reporting: Latin America
Segment reporting: Latin America (in mio €) Underlying Reported 2016 2017 H1/2017 H2/2017 2016 2017 Consolidated sales 682 673 356 317 682 673 EBIT 67 55 28 26 67 80 EBIT margin 9.8% 8.2% 8.0% 8.4% 9.8% 11.9% Depreciation, amortization and 22 20 11 8 22 20 impairment losses EBITDA 89 74 40 35 88 100
Slide 13: Segment reporting: Asia Pacific
Segment reporting: Asia Pacific (in mio €) Underlying Reported 2016 2017 H1/2017 H2/2017 2016 2017 Consolidated sales 1 052 1 145 565 580 1 052 1 145 EBIT 119 107 61 46 100 104 EBIT margin 11.3% 9.3% 10.7% 7.9% 9.5% 9.1% Depreciation, amortization and 103 90 47 43 119 89 impairment losses EBITDA 222
Slide 14: Segment reporting: BBRG
Segment reporting: BBRG (in mio €) Underlying Reported 2016 2017 H1/2017 H2/2017 2016 2017 Consolidated sales 320 455 234 221 320 455 EBIT 13 15 11 4 (9) 12 EBIT margin 4.1% 3.3% 4.7% 1.8% -2.7% 2.7% Depreciation, amortization and 21 26 11 15 22 26 impairment losses EBITDA 35 41 22 19 13 38 EBITDA m
Slide 15: Consolidated income statement: key figures
Consolidated income statement: key figures (in mio €) 2016 2017 EBIT 260 318 Interest income / expense (73) (87) Other financial income and expenses (37) (6) Result before taxes 149 225 Income taxes (62) (69) Result after taxes (consolidated companies) 87 156 − Higher net interest expense mainly due
Slide 16: Consolidated income statement: key figures
Consolidated income statement: key figures (in mio €) 2016 2017 Result after taxes (consolidated companies) 87 156 Share in the results of joint ventures and associates 25 27 Result for the period 112 183 Attributable to non-controlling interests 7 -2 Attributable to the Group 105 185 − As a result
Slide 17: Cash flow: key figures
Cash flow: key figures (in mio €) 2016 2017 Gross cash flows from operations 376 356 Cash flows from operations 400 244 Cash flows from investment activities (100) (226) Cash flows from financing activities (302) 47 − Gross cash flows from operations were down € 20 million due to lower EBITDA. − Cas
Slide 18: Working capital: key figures
Working capital: key figures (in mio €) 2016 2017 Inventories 724 780 Accounts receivable 819 910 Accounts payable (701) (802) Working capital 843 888 − The nominal increase in Working Capital by € 45 million was mainly the result of higher outstanding trade receivable balances, while the organic in
Slide 19: Consolidated balance sheet: key figures
Consolidated balance sheet: key figures (in mio €) 2016 2017 Non-current assets 2 137 2 124 Current assets 2 168 2 321 Total assets 4 304 4 445 Equity 1 598 1 583 Non-current liabilities 1 504 1 449 Current liabilities 1 202 1 413 Total equity and liabilities 4 304 4 445 20
Slide 20: Balance sheet: key figures
Balance sheet: key figures (in mio €) 2016 2017 Net financial debt 1 068 1 151 Gearing (net debt to equity) 66.8% 72.7% Net debt on EBITDA (underlying) 2.1 2.3 Net debt on EBITDA (reported) 2.2 2.3 − Net financial debt excluding debt related to BBRG would have been € 694 million, versus € 632 millio
Slide 21: Ratios: key figures
Ratios: key figures Underlying Reported 2016 2017 2016 2017 Gross profit margin 18.6% 17.2% 17.7% 17.1% EBITDA margin 13.8% 12.1% 13.0% 12.4% EBIT margin 8.2% 7.3% 7.0% 7.8% Sales on capital employed (asset rotation) 1.4 1.5 1.4 1.5 Return on capital employed (ROCE) 11.8% 11.2% 10.0% 11.8% Return on
Slide 22: Key figures per share
Key figures per share (in €) 2016 2017 Share price 38.49 36.45 Number of existing shares 60 347 525 60 373 841 Book value 24.31 24.64 Earnings per share (EPS) 1.87 3.26 Weighted average number of shares 56 263 172 56 741 126 23
Slide 23: Outlook (1/3)
Outlook (1/3) We project broad economic strength in most parts of the world in 2018, with the exception of Latin America. We anticipate good demand in our automotive markets, particularly driven by growth in truck tire markets, and in mining and construction markets. Prospects for the oil & gas sect
Slide 24: Outlook (2/3)
Outlook (2/3) However, we will progressively improve on all controllable factors in 2018: - During Q4 2017, we have been better able to pass on wire rod price increases without adversely affecting sales volumes. We expect continued margin recovery in 2018. - We have made a breakthrough in the develo
Slide 25: Outlook (3/3)
Outlook (3/3) That is why we are confident we will improve our profitability progressively during 2018 to achieve the same profitability level of 2017. We continue to believe that the improvements we are making throughout our business will allow us to move towards a 10% underlying EBIT margin over t
Slide 26: Our transformation journey
Our transformation journey Our transformation journey includes: a manufacturing excellence program aimed at gaining competitiveness by improving the company’s safety, quality, delivery performance and productivity; a customer excellence program to drive growth and margin performance; a supply chain
Slide 27: Shareholder value: ROIC (8.7%) > WACC (8.0%) in 2017
Shareholder value: ROIC (8.7%) > WACC (8.0%) in 2017 20 18 16 14 12 10 8 6 4 2 0 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 -2 -4 -6 -8 -10 Shareholder value WACC RoIC 28
Slide 28: Dividend proposal
Dividend proposal The Board of Directors confirms its confidence in the strategy and future perspectives of the company and will propose to the Annual General Meeting of Shareholders to distribute a gross dividend of € 1.10 per share, unchanged from last year. in € 1,80 1,60 1,40 1,20 1,00 0,80 0,60
Slide 29: Nomination of new Director
Nomination of new Director The Board of Directors of NV Bekaert SA is proud to announce the nomination of Mr Colin Smith for appointment by the Annual General Meeting of Shareholders of 9 May 2018. He will replace Mr Alan Begg whose term of office will expire and who is not seeking re-election. Coli
Slide 30: better together
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