Hexagon Ab Class B · OMXSTO:HEXA_B
Hexagon Ab Class B — Q1 2007 Earnings Presentation
34 slides from Hexagon Ab Class B's earnings presentation, May 2, 2007
Slide 1: Q1 Report 2007
Q1 Report 2007
Slide 2: Agenda
Agenda 2 May 2007 • Summary Q1 2007 • Market summary Q1 2007 • Business areas • Hexagon going forward
Slide 3: Summary Q1 2007
Summary Q1 2007 3
Slide 4: Summary Q1 2007
Summary Q1 2007 Q1 Q1 Change MSEK 2007 2006 % Order intake 3 780 3 408 18 3) Net sales 3 499 3 335 12 3) Operating earnings (EBIT1) 520 388 34 Operating margin, % 14.9 11.6 3.3 Non-recurring items, net 22 1) 13 2) n.a. Earnings before tax 496 322 54 Earnings after tax 436 263 66 Earnings per share 4
Slide 5: Summary Q1 2007 versus market expectations
Summary Q1 2007 versus market expectations Q1 Market MSEK 2007 expectation Deviation Net sales 3 499 3 518 -1% Operating earnings (EBIT1) 520 478 9% Operating margin, % 14.9 13.6 1.3 Earnings before non-recurring items 474 433 10 % Non-recurring items, net 22 105 Earnings before tax 496 538 -8% Tax
Slide 6: Capital gains and non-recurring items
Capital gains and non-recurring items Q1 MSEK 2007 Capital gain Johnson Metall 100 Capital gain Eurosteel 20 Sum 120 Restructuring costs MAC - 23 Write-offs (Outokumpu Nordic Brass) - 55 FARO trial - 20 Sum - 98 Total net 22 6
Slide 7: Cash flow fiscal 2007
Cash flow fiscal 2007 Q1 Q1 MSEK 2007 2006 Cash flow from operations before change in working capital 513 361 Cash flow from change in working capital -312 -494 Cash flow from operations 201 -133 Cash flow from ordinary investing activities -176 -156 Operating cash flow 25 -289 7
Slide 8: Order intake and invoiced sales
Order intake and invoiced sales MSEK 15 000 Order Intake 6 month trend 14 000 13 000 3 month trend 12 000 11 000 12 month rolling average 10 000 9 000 J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D 15 000 Invoiced Sales 6 month trend 14 000 3 month trend 13 000 12 000 11 000
Slide 9: Market summary Q1 2007
F ons Market summary Q1 2007 O)) HEXAGON
Slide 10: EMEA market trends
EMEA market trends ¤ EU made industrial goods grow and gain market shares ¤ Growth in residential housing ¤ Civil engineering gearing up gives more large infrastructural projects ¤ Strong growth continues in Eastern Europe and Middle East Outlook 2007: Growth, % Q1 ¤ Continuous strong demand Order i
Slide 11: Americas market trends
Americas market trends ¤ US made cars continue its struggle Toyota bypassed GM as the number one supplier ¤ Good demand from other sectors of the engineering industry ¤ Residential housing still weak ¤ Civil engineering gearing up Outlook 2007: Growth, % Q1 ¤ Continuous moderate increase in demand
Slide 12: Asia market trends
Asia market trends ¤ Strong growth in China continues ¤ Good growth in Rest of Asia ¤ Japanese recovery ¤ Change of distribution model in China practically completed Outlook 2007: ¤ Continuous strong demand Growth, % Q1 Order intake 35 Net sales 29 12
Slide 13: Recorded and adjusted growth in sales
Recorded growth in sales 2007 2006 % Q1 Q1 Q2 Q3 Q4 Year EMEA 7 17 10 85 17 26 Americas -13 134 87 77 -6 55 Asia 27 204 150 213 9 101 Total 5 49 35 97 9 40 Adjusted growth in sales 2007 2006 % Q1 Q1 Q2 Q3 Q4 Year EMEA 13 11 11 15 20 14 Americas -2 20 3 3 -2 3 Asia 29 19 15 33 4 17 Total 12 15 7 14 1
Slide 14: Hexagon Measurement Technologies
Hexagon Measurement Technologies 14
Slide 15: Hexagon Measurement Technologies in Q1
Hexagon Measurement Technologies in Q1 Q1 Q1 Change MSEK 2007 2006 % Order intake 2 715 2 303 20 1) Net sales 2 483 2 276 12 1) Operating earnings (EBIT1) 451 309 46 Operating margin, % 18.2 13.6 4.6 Employees at end of period 5 297 4 850 1) Adjusted for currency fluctuations and changes in group st
Slide 16: Hexagon Measuring Technologies Sales per region past 15 months
Hexagon Measuring Technologies Sales per region past 15 months % 60 EMEA 50 40 AMERICAS 30 20 ASIA 10 0 Q1-06 Q2-06 Q3-06 Q4-06 2006 Q1-07 16
Slide 17: Hexagon Measurement Technologies in Q1
Hexagon Measurement Technologies in Q1 ¤ Operating margin of 18 % ¤ Organic growth of 12 % ¤ Substantial growth in certain geographical markets EMEA: 17 % in order intake and 11 % in net sales Americas: 17 % in order intake and 3 % in net sales Asia: 32 % in order intake and 24 % in net sales
Slide 18: Machine Control
Machine Control Level 3 Titan / Virtual Explorer Level 2 Fleet Management Level 1 18
Slide 19: Machine Control market
Machine Control market Segment: Construction Agriculture Mining Market size: 450 MCHF 450 MCHF 100 MCHF Hexagon market 4 → 18 % 0% 15 % share: Segment #1 Trimble #1 Deere #1 Modular leaders: #2 Topcon #2 Trimble #2 Hexagon Market Infrastructural Increased Raw material drivers: investments population
Slide 20: Acquisition Svensk ByggnadsGeodesi AB, SBG
Acquisition Svensk ByggnadsGeodesi AB, SBG ¤ Multidimensional systems for measuring, planning and machine control ¤ Turnover 40 MSEK ¤ Annual growth about 30 % ¤ 30 employees in Sweden ¤ Consolidated 15 January ¤ A further step in Hexagon’s dynamic growth intentions in machine automation 20
Slide 21: Acquisition D&P Systems and Topolaser
Acquisition D&P Systems and Topolaser ¤ Multidimensional machine control system ¤ Turnover 45 MSEK, annual growth 20 % ¤ 22 employees in France ¤ Consolidated 1 May 21
Slide 22: Hexagon Polymers
Hexagon Polymers O)) HEXAGON
Slide 23: Hexagon Polymers in Q1
Hexagon Polymers in Q1 Q1 Q1 Change MSEK 2007 2006 % Order intake 671 652 6 1) Net sales 656 636 6 1) Operating earnings (EBIT1) 69 64 8 EBIT1 margin, % 10.5 10.1 0.4 Employees at end of period 2 124 1 783 1) Adjusted for currency fluctuations and changes in group structure (organic growth). 23
Slide 24: Hexagon Polymers in Q1
Hexagon Polymers in Q1 ¤ Increase in raw material prices levelled out ¤ Canadian plant negatively affected by cut backs in US auto plants ¤ Strong underlying volume growth in the outsourcing business ¤ China started production in March 2007 ¤ Establishment in Mexico according to plan ¤ Decision to d
Slide 25: Other operations
Other operations O)) HEXAGON
Slide 26: Divestment Johnson Metall and Eurosteel AB
Divestment Johnson Metall and Eurosteel AB ¤ Sales about 1 134 MSEK ¤ About 550 employees ¤ Capital gains about 120 MSEK ¤ The new owners consolidate Johnson Metall as of 1 February Eurosteel as of 1 March 26
Slide 27: Other operations in Q1
Other operations in Q1 Q1 Q1 Change MSEK 2007 2006 % Order intake 394 453 30 1) of which current operations 169 136 Net sales 361 424 26 1) of which current operations 177 157 Operating earnings (EBIT1) 13 23 n.a. 2) of which current operations 2 5 Employees at end of period 452 1 046 1) Adjusted fo
Slide 28: Other operations in Q1
Other operations in Q1 ¤ Gradual disposal to be completed by the end of 2008 When companies fit to leave Hexagon When attaining the right price ¤ Continue to develop the businesses in the best possible way as long as they are a part of Hexagon 28
Slide 29: Hexagon going forward
Hexagon going forward O)) HEXAGON
Slide 30: Hexagon organic growth
Hexagon organic growth GIS % 2005 2006 2007 2008 ¤ EMEA should grow faster than Americas EMEA 9 14 5-15 5-12 due to Eastern Europe Americas 17 3 0-10 0-10 and Middle East ¤ Americas is the big Asia 26 17 20-30 20-30 unknown Total 12 12 ≥ 10 ≥ 10 ¤ Asia's share of sales will grow from 15 % to 22 % 30
Slide 31: Hexagon focus areas - Organic growth & Acquisitions
Hexagon focus areas - Organic growth & Acquisitions ¤ Grow market share for macro products in Americas and Asia ¤ Machine Control Mining ¤ Machine Control Agriculture ¤ Laser technologies ¤ Geospatial Information Systems ¤ Portable CMMs ¤ New sensor technologies ¤ PCDMIS EMS ¤ Vision ¤ Nano technolo
Slide 32: Board of Directors propositions
Board of Directors propositions ¤ Dividend proposal of 5.00 SEK per share Record date for payment 7 May 2007 Payment from VPC on 10 May 2007 ¤ Share split proposal of 3:1 To be concluded end of May 2007 32
Slide 33: Summary
Summary ¤ Financial targets 2008 should be met and possibly exceeded Organic growth and acquisitions Financial leverage in Hexagon Measurement Technologies will back up margin expansion ¤ New targets will be set as the old become obsolete ¤ Target growth areas highly attractive ¤ Long-term finan
Slide 34: Hexagon
O)) HEXAGON precision in everything O)) HEXAGON