Tecan Group Ag · SIX:TECN
Tecan — H1 2018 Earnings Presentation
24 slides from Tecan's earnings presentation, Aug 16, 2018
Slide 1: Half Year Results 2018
Zurich, August 16 2017 Zurich, August 16 2018 Half HalfYear Year Results Results2017 2018 ANALYST & MEDIA CONFERENCE CALL ANALYST & MEDIA CONFERENCE CALL
Slide 2: Speakers
Speakers Dr. David Martyr, CEO Dr. Rudolf Eugster, CFO 2
Slide 3: Agenda
Agenda INTRODUCTION FINANCIAL RESULTS UPDATE AND OUTLOOK QUESTIONS AND ANSWERS 3
Slide 4: Financial Highlights H1 2018
Financial Highlights H1 2018 • Strong sales growth +8.4% and +6.9% LC*; almost exclusively organic • Double-digit sales growth of +16.1% in LC in Partnering Business • Total recurring revenues at 45% of sales • Operating profit with significant increase: EBIT +26%, EBITDA +16% • Net profit also grow
Slide 5: Operating Highlights H1 2018
Operating Highlights H1 2018 • Market launch of Fluent® Gx platform variant for regulated markets • Successful registration as a Class I medical device in the US • Strong demand leading to sharp rise in order backlog in the Life Sciences Business • Prestigious customers ordering multiple instruments
Slide 6: Agenda
Agenda INTRODUCTION FINANCIAL RESULTS UPDATE AND OUTLOOK QUESTIONS AND ANSWERS 6
Slide 7: Order Entry and Sales Performance
H1 2018 Order Entry and Sales Performance ORDER ENTRY H1 2018 320 ORDER ENTRY H1 2018 VS. H1 2017 298.1 300 290.1 • +2.8% in CHF, +1.3% in LC • CHF (mio) 280 Substantially exceeding sales in CHF 260 (book-to-bill ratio of 1.09) 240 • H1 2017 influenced by timing of several large orders in Partnering
Slide 8: Segment Sales
H1 2018 Segment Sales SALES (IN CHF MILLIONS) 2017 150 140.5 2018 140 138.2 133.0 130 LIFE SCIENCES BUSINESS: 120 • Sales up by 1.7% in CHF and down by -0.6% in LC 114.0 110 • Following growth of 18.2% in LC in H1 2017 100 • Strong demand for new Fluent Gx platform 90 contributing significantly to s
Slide 9: Regional Sales Development
H1 2018 Regional Sales Development YoY % +5.4% in LC EUROPE: +10.6% in CHF • Partnering Business growing 40%; unusually low base in prior-year period Others • Life Sciences Business benefited from stronger euro; 2.1% stable against high base of H1 2017 in LC Asia NORTH AMERICA: 15.5% • Development m
Slide 10: Gross Profit
H1 2018 Gross Profit GROSS PROFIT (% = % OF SALES) GROSS PROFIT INCREASED TO CHF 128.5M • CHF 8.3m or 6.9% above H1 2017 130 128.5 GROSS PROFIT MARGIN DOWN BY 70BPS 120.2 • Main effects contributing: 120 • (-) Exchange rate impact (cost in euro > sales in euro) CHF (mio) • (-) Divisional mix with hi
Slide 11: Cost Structure
H1 2018 Cost Structure OPERATING EXPENSES (% = % OF SALES) OPERATING EXPENSES GREW LESS THAN SALES 100 89.8m 90.4m (33.1%) (35.6%) • Operating expenses down by 250 bps 80 40.4 42.3 • Sales & Marketing increased less than sales (16.0%) (15.5%) despite continued investments in market units CHF (mio) 6
Slide 12: EBIT and EBITDA
H1 2018 EBIT and EBITDA EBIT AND EBITDA (IN CHF MILLIONS) EBIT INCREASED TO CHF 37.8M 50 48.1 • 7.9m or 26.3% above H1 2017 41.6 EBITDA GREW TO CHF 48.1M 40 37.8 2017 • CHF 6.5m or 15.5% above H1 2017 2018 29.9 30 EBIT MARGIN AT 13.8%, UP BY 190 BPS 20 EBIT EBITDA • At H1 2017 constant exchange rate
Slide 13: Segment Profitability
H1 2018 Segment Profitability EBIT (IN CHF MILLIONS) 30 LIFE SCIENCES BUSINESS: 25.6 25 • EBIT margin at 12.2% 20 17.8 18.1 19.3 • Factors contributing include: 2017 • (-) Exchange rate impact 15 2018 10 • (+) Lower OPEX • (+) Efficiency gains 5 0 Life Sciences Partnering Business Business PARTNERIN
Slide 14: Net Profit
H1 2018 Net Profit NET PROFIT 35 NET PROFIT GREW FASTER THAN SALES 30 29.2 • CHF 3.1m or 12.1% above H1 2017 26.0 26.0 25 23.5 NET PROFIT MARGIN +40 BPS TO 10.7% CHF (mio) 20 EBIT INCREASE OF CHF 7.9M 18.6 48.8% 49.5% 15 BELOW EBIT LINE • (-) CHF 4.6m lower financial result 10 • (+) Lower tax rate o
Slide 15: Basic Earnings per Share
H1 2018 Basic Earnings per Share BASIC EARNINGS PER SHARE EARNINGS PER SHARE INCREASED TO 3 CHF 2.49 2.49 2.31 2.25 2 2.04 AVERAGE NUMBER OF SHARES CHF / share 1.68 OUTSTANDING: 11.7M (H1 2017: 11.6M) 1 48.8% 49.5% 48.8% 49.5% 0 2014 2015 2016 2017 2018 15
Slide 16: Cash Flow
H1 2018 Cash Flow +38.4 309.4 -20.8 301.1 -25.9 Cash at end of From Operations From Investments From Financing1 Cash at end 2017 of June 2018 CASH FLOW FROM OPERATIONS UP BY 21% TO CHF 38.4M (H1 2017: CHF 31.7M) • Cash conversion of 14.0% of sales • Days Sales Outstanding increased to 55 days (H1 20
Slide 17: Key Figures
H1 2018 Key Figures 2017 2018 Δ IN % Order Entry (in CHF mio) 290.1 298.1 +2.8% Sales (in CHF mio) 252.2 273.5 +8.4% Sales in local currencies (in CHF mio) 255.9 273.5 +6.9% Gross Profit (in CHF mio) 120.2 128.5 +6.9% in % of sales 47.7% 47.0% R&D (in CHF mio) 23.5 22.0 -6.3% in % of sales 9.3% 8.1%
Slide 18: Agenda
Agenda INTRODUCTION FINANCIAL RESULTS UPDATE AND OUTLOOK QUESTIONS AND ANSWERS 18
Slide 19: Accelerating Broad Genomics Strategy with Acquisition of NuGEN Technologies
Accelerating Broad Genomics Strategy with Acquisition of NuGEN Technologies • Tecan further expanding dedicated solution offering in new market segment of NGS reagents • US-based NuGEN is a leading provider of innovative NGS kits and sample prep reagents, serving the fastest growing field within gen
Slide 20: NGS Workflows are Composed of Multiple Steps
NGS Workflows are Composed of Multiple Steps THEY REPRESENT ABOUT HALF OF THE OVERALL USD 12BN GENOMICS MARKET Sample Extraction Library prep Library QC Sequencing Data analysis collection Broad range of The largest The fastest Check-point step Wide range of Highly fragmented sample types are Genomi
Slide 21: Organic Outlook for 2018 Confirmed
Organic Outlook for 2018 Confirmed SALES DEVELOPMENT ORGANIC OUTLOOK 1 FOR 2018 600 Growth in MSD range • Confirming organic outlook for 2018 given in March 575 in LC1 550 548.6 • Organic sales growth in the mid-single-digit CHF (mio) 525 506.2 percentage range in LC expected 500 475 • After signifi
Slide 22: Q&A
Q&A IR IPAD APP CONTACT News, financial reports, Martin Braendle presentations, Vice President, Communications & IR videos and more Phone: +41 (0) 44 922 84 30 investor@tecan.com NEXT EVENTS 2019 www.tecan.com March 14: Full Year Results 2018 April 16: Annual Shareholder Meeting 22
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Slide 24: Tecan – Who we are
Tecan – Who we are Tecan (www.tecan.com) is a leading global provider of laboratory instruments and solutions in biopharmaceuticals, forensics and clinical diagnostics. The company specializes in the development, production and distribution of automated workflow solutions for laboratories in the lif