Technogym S.p.a · MIL:TGYM
Technogym — FY2017 Earnings Presentation
20 slides from Technogym's earnings presentation, Mar 28, 2018
Slide 1: Financial Results Full Year 2017
Financial Results 28 March 2018 Full Year 2017
Slide 2: Disclaimer
Disclaimer THIS PRESENTATION AND ANY OTHER INFORMATION DISCUSSED AT THE PRESENTATION (THE “PRESENTATION”) IS STRICTLY CONFIDENTIAL AND IS BEING PROVIDED TO YOU SOLELY FOR YOUR INFORMATION. THIS PRESENTATION, WHICH HAS BEEN PREPARED BY TECHNOGYM, S.P.A. (THE “COMPANY”), IS PRELIMINARY IN NATURE AND I
Slide 3: 2017 - another year of sustainable growth and innovation: new products
2017 - another year of sustainable growth and innovation New products for new market trends (formats, athletic training) … • MyCycling combines hi-tech smart trainer, a native app and a network of dedicated trainers • SkillRow, 1st indoor rower to train anaerobic, aerobic and neuromuscular abilities
Slide 4: 2017 - another year of sustainable growth and innovation: digital ecosystem
2017 - another year of sustainable growth and innovation … and a fast growing digital ecosystem • Teambeats, an innovative Heart Rate Training platform for classes • New Apps, from MyWellness 4.0 to SkillRow and MyCycling • Apple watch compatibility, with users able to connect to MyWellness Ecosyste
Slide 5: 2017 - another year of sustainable growth and innovation
2017 - another year of sustainable growth and innovation … allowed Technogym to achieve: • High single digit top line growth, outpacing the market and competitors • Increasing profitability: 20,1% EBITDA margin 15,3% EBIT margin • Net Profit grew by 42% Y/Y exceeding 61m € • Strong cash conversi
Slide 6: 2017 confirmed high single-digit top line growth
2017 confirmed high single-digit top line growth Revenues (€m) Key comments +7,7% 598,2 606,3 Positive volume effect primarily 555,3 coming from • Overseas market (NA, APAC, 9,2% LATAM) • Club, in particular KA business • New product launches (Group Cycle, My Cycling, Skill line, Climb) at c. 16% of
Slide 7: Double-digit growth in LATAM, NA & APAC supports topline
Double-digit growth in LATAM, NA & APAC supports topline Revenues breakdown by geography - €m, percentage incidence & change 7,7% 2017 vs. 2016 598,2 28,6 26,0% 555,3 (5%) LATAM 22,7 66,1 North (4%) 13,3% 58,4 (11%) America (11%) 54,0 MEIA 5,9% 51,0 (9%) (9%) 88,9 81,0 (15%) APAC 9,8% (15%) 56,4 54,
Slide 8: High single-digit growth in wholesale and field sales
High single-digit growth in wholesale and field sales Revenues breakdown by channel - €m, percentage incidence & change 7,7% 598,2 2017 vs. 2016 5,6 555,3 41,2 (1%) Retail 5,7 (7%) -0,7% 40,9 (1%) Inside Sales (7%) 0,6% 134,3 (22%) Distributors 122,3 9,8% (22%) 417,1 386,4 (70%) Field Sales 7,9% (70
Slide 9: Balanced top line growth between new & historical clients
Balanced top line growth between new & historical clients Revenues growth (€m) Key comments 600 598 595 Existing clients • Represented 56% of incremental 590 revenues 19 • Accounted for c. 2/3 of total 585 revenues in 2017 580 New clients • Represented 44% of incremental 575 revenues 570 • Accounted
Slide 10: Cost base impact substantially in line with Y-1 excluding non-recurring costs
Cost base impact substantially in line with Y-1 performance excluding non-recurring costs Recurring cost base evolution (% REV) Key comments Total costs €481m €507m D&A / Impairments • In line with Y-1 as % of sales % REV 86,6% 84,5% Personnel cost • Slight increase compared to Y-1 Impairments 1,1%
Slide 11: EBITDA adjusted growing at >20% vs Y-1 with positive impact on profitability
EBITDA adjusted growing at >20% vs Y-1 with positive impact on profitability (20,1% vs 18,0% of Y-1) EBITDA evolution (€m) Key comments 20,3% EBITDA adjusted margin increase: 125,3 120,2 • Positive price effect, especially +4,2% FX thanks to cardio products family 99,9 • Improving product mix due to
Slide 12: Profit and Loss statement
Profit and Loss statement Key comments (€m) December 2016 2017 %Chg Net operating income drivers Total revenue 555,3 598,2 7,7% • Commercial customers leading the growth with sound contribution from Cost or raw, ancillary and consumable materials and goods for resale (196,4) (205,3) 4,5% Clubs • Rev
Slide 13: Trade Working Capital <10% on revenues
Trade Working Capital <10% on revenues Working Capital (€m) Key comments (€m) December TWC below 10% of revenues and significantly 2016 2017 declining vs. H1 17 (11,5% of revenues) Inventories 72,2 64,1 Inventories Trade receivables 94,1 117,1 • Significantly declining both in absolute and Trade pay
Slide 14: CAPEX at 4.2% on revenues from 4.0% of Dec '16 excluding TGV one off investment
CAPEX at 4.2% on revenues from 4.0% of Dec ’16 excluding TGV one off investment Capex analysis (€m) Key comments % REV 19.7% 4.2% Tangibles % REV 4.0% 4.2% • Investment in industrial tools, (exc. non 109,6 moulds and production lines recurrent property inv.) 8,3 Intangibles 14,0 • New ERP project •
Slide 15: Net Financial Debt
Net Financial Debt Net Financial Debt (€m) Key comments (€m) December Cash & Cash equivalent 2016 2017 • Benefitted from cash generation in 2017 and Cash & cash equivalent (53,1) (77,8) mainly refers to bank deposits € denominated Current financial receivables (0,7) (0,1) Current bank debt • Mainly
Slide 16: Net Financial Debt walk (in m €)
Net Financial Debt walk (in m €) Key comments Strong cash flow generation and very low leverage provides Technogym high financial flexibility to continue investing in innovation 0,74x 0,34x 78,0 41,3 5,7 3,9 13,0 120,2 25,2 17,2 18,5 NFD 2016 CF from Tax paid NWC CAPEX Dividend Financial Other NFD 2
Slide 17: Appendix
Appendix Strictly Private and Confidential 16
Slide 18: Balance Sheet
Balance Sheet Dec 2016 % on Revenues Dec 2017 % on Revenues Inventories 72,2 13,0% 64,1 10,7% Trade receivables 94,1 16,9% 117,1 19,6% Trade payables (125,6) (22,6%) (123,5) (20,6%) Trade Working Capital 40,7 7,3% 57,7 9,6% Other current assets/(liabilities) (47,6) (8,6%) (52,4) (8,8%) Current tax l
Slide 19: EBITDA Reconciliation
EBITDA Reconciliation (€m) December 2016 2017 Dec 2016 vs Dec 2017 Δ Net operating income 68,4 91,4 33,7% LTMIP before 2015 0,0 0,0 Restructuring costs 0,1 0,2 Consultancies costs 0,0 0,0 IPO Cost 3,0 0,0 Brasil tax (previous year) 2,2 0,0 China WH litigations 0,6 0,0 Total not recurring items 5,8 0
Slide 20: Cash Flow statement
Cash Flow statement (€m) December Δ ass. Δ% 2016 2017 Consolidated profit for the year 43,2 61,5 18,3 42,3% Depreciation, amortization and impairment losses 23,2 24,5 Provisions 2,5 4,1 Share of net result from joint ventures (0,1) (0,0) Net financial expenses 2,5 4,2 Income/(expenses) from investme