Kitron Asa · OSL:KIT
Kitron Asa — Q3 2023 Earnings Presentation
14 slides from Kitron Asa's earnings presentation, Oct 25, 2023
Slide 1: 2023 Q3 Presentation
2023 Q3 Presentation Kitron Group | 2023-10-25
Slide 2: Third quarter 2023 Highlights
Third quarter 2023 Highlights ▪ Revenue: 179.2 +8.3% (165.5) ▪ EBIT: 16.2, +41% (11.5) ▪ EBIT margin: 9.0% (6.9%) ▪ ROOC: 23.2% (19.8%) ▪ Cash Cycle Conversion days: 103 (101) ▪ NIBD: 141.6 (156.3) ▪ NIBD/EBITDA 1.7 (3.1) ▪ Net Gearing: 0.8 (1.1) ▪ Equity %: 28.6% (24.7%) ▪ Order Backlog: 502, +9.6%
Slide 3: YTD 2023 Highlights
YTD 2023 Highlights ▪ Revenue (€M): 576.1, +23.5% (466.4) ▪ EBIT (€M): 52.7, +79.6% (29.3) ▪ EBIT margin: 9.1% (6.3%) ▪ Net Income (€M): 38.7, +108.6% (18.6) ▪ Net margin: 6.7 % (4.0%) ▪ Cash Flow YTD (€M): 24.4 (7.7) ▪ Investments YTD (€M): 8.6 (5.6)* ▪ EPS (EUR): 0.195, +108 % (0.094) MNOK CORRESP
Slide 4: Third quarter trends
Third quarter trends Sector trends ▪ Electrification sector: Energy efficiency, Energy grids and transmission, and Energy storage solutions show strength. ▪ Defense sector – solid growth and outlook for 2023. ▪ Other sectors: Customers are addressing market unpredictability by reducing stock levels
Slide 5: Order backlog
Order backlog ▪ The growth is driven by the Electrification and Defense sectors. ▪ Other sectors: Customers address market unpredictability by reducing stock levels and utilizing shorter lead times, normalizing their order and forecast periods to under six months and thus reducing visibility. ▪ Orde
Slide 6: R12 and R06 Forward demand
R12 and R06 Forward demand ▪ Growing market sectors for Q4 and 2024 o The Electrification sector is on an upward trajectory, expecting increased volumes o The Defense sector projects a promising outlook, with customers eager to accelerate their orders. ▪ Other sectors, some customers are taking defe
Slide 7: Currency and growth
Currency and growth ▪ Revenue growth in €M of 8.3% in Q3 and 23.5% YTD. ▪ Waterfalls describe underlying growth and currency effects in MNOK vs €M. ▪ EUR Rate AVE: o Q3 NOK 11.40 o Q2 NOK 11.66 o Q1 NOK 11.00 7
Slide 8: Business sectors
Business sectors ▪ Strong growth in Nordics and CEE and improved profits overall. Revenue Business Sectors Q3 2023 Q3 2022 Change 30.09.2023 30.09.2022 Change Full year 2022 Nordics 67.2 58.8 8.4 218.6 178.0 40.6 247.7 CEE 71.8 53.0 18.8 227.2 145.3 81.9 205.3 ▪ EBIT margin increased from 6.9% to 9.
Slide 9: Cash flow and working capital
Cash flow and working capital €M Cash Flow Q3 2023 Q3 2022 Change 30.09.2023 30.09.2022 Profit before tax 12.3 10.3 2.0 47.9 24.0 Depreciations 4.5 4.2 0.3 12.8 12.3 Change in inventory, accounts receivable, ▪ Q3 Cash flow from operating activities contract assets and accounts payable -11.1 4.2 -15.
Slide 10: Ratios
Ratios €M Ratios 30.09.2023 30.09.2022 Change 31.12.2022 R3 NWC % sales 26.7 % 25.8 % 0.9 % 26.2 % ▪ Ratios affected by seasonality in Q3 R3 ROOC % sales 23.2 % 19.8 % 3.4 % 22.9 % R3 Cash Cycle Conversion 103 101 2 100 ▪ Net gearing and NIBD/EBITDA 0.85 and 1.7 excl IFRS. Net Interest bearing debt
Slide 11: Outlook full-year 2023
Outlook full-year 2023 ▪ Demand continues to support current revenue and operating profit outlook. ▪ Our current outlook: o We expect revenues between 750 and 800 EUR million with an operating profit (EBIT) between 65 and 75 EUR million. 11
Slide 12: Key take-ways
Key take-ways ▪ Continued growth in Nordics, U.S. and CEE driven by Defense, Electrification, regionalization and new business ramp-ups. ▪ There's a noticeable deceleration of growth among customers in Industry and Connectivity due to some macro challenges, de-stocking, and benefit from quicker lead
Slide 13: Q&A
Q&A
Slide 14: Appendix: Definition of alternative performance measures
Appendix: Definition of alternative performance measures Order backlog Return on capital employed (ROCE) Cash conversion cycle (CCC) All firm orders and 4 months of committed customers forecast at EBIT/(Total assets - short term debt) Days of inventory outstanding + Days of receivables outstanding –