Sonova Holding Ag · SIX:SOON
Sonova — FY2005/06 Earnings Presentation
17 slides from Sonova's earnings presentation, Jun 1, 2006
Slide 1: Media and Financial Analysts Meeting FY 2005/06
THE WORLD OF SOUND Media and Financial Analysts Meeting FY 2005/06 June 1, 2006 Media and Financial Analysts Meeting Welcome address Business Report Financial Year 2005/06 Dr. Valentin Chapero, Chief Executive Officer 2 1
Slide 2: Financial Year 2005/06: Major progress on all levels
Financial Year 2005/06: Major progress on all levels • Sales increase of 31% to CHF 867m • Market share gains in all major markets • Sharp rise of Gross profit-, EBIT-, and Income after taxes-margin • EPS growth of 79% to CHF 2.57 • Most competitive product portfolio in the hearing instrument indust
Slide 3: Strong sales growth in major regions
Strong sales growth in major regions Sales distribution by main markets FY 2005/06 (FY 2004/05) 1% (2%) Sales growth y-o-y 8% (8%) in % and l.c. 45% (49%) Americas 34.7% Europe 20.4% Asia / Pacific 37.9% Others 2.6% 46% (41%) 5 Sales growth of 31% in reported currency (CHF) Internal growth +23.8% Ex
Slide 4: Sharp rise in profitability
Sharp rise in profitability Gross profit (In millions of CHF) +38.1% FY 2004/05 417.8 Gross-margin 63.3% FY 2005/06 577.2 Gross-margin 66.6% 0 200 400 600 0% 20% 40% 60% 80% EBIT (In millions of CHF) +68.3% FY 2004/05 125.8 EBIT-margin 19.0% FY 2005/06 211.7 EBIT-margin 24.4% 0 100 200 0% 10% 20% 30
Slide 5: Underlying drivers for success
Underlying drivers for success Innovation • Improve hearing performance • Focus on esthetics and comfort • Create new functionalities for new customers Improve distribution and sales capabilities • Build strong customer relationship • Improve sales force efficiency • Broaden service approach • Suppo
Slide 6: The best fit – full coverage of all customer needs
The best fit – full coverage of all customer needs: Performance, esthetics, price PALIO-based product portfolio as of June 2006 Functionality Open fitting Micro System Ext. Receiver (CRT) 11 New program will be launched to improve B2B customer intimacy and end-user brand awareness Objectives • Raise
Slide 7: Facts & Figures Financial Year 2005/06
Media and Financial Analysts Meeting Facts & Figures Financial Year 2005/06 Oliver Walker, Chief Financial Officer 13 Highlights • Excellent sales growth leads to significant market share gains • Continuous margin improvements • more favorable product mix • economies of scale • manufacturing efficie
Slide 8: Improvements in all aspects
Improvements in all aspects Key Figures In millions of CHF FY 2005/06 FY 2004/05 Change in % Sales 866.7 660.4 +31.2% EBIT 211.7 125.8 +68.3% EBIT-margin 24.4% 19.0% ROCE 52.6% 36.1% Income after taxes 172.5 95.9 +79.9% Income after taxes-margin 19.9% 14.5% Diluted EPS 2.568 1.434 +79.1% ROE 32.0% 2
Slide 9: Excellent growth of First and Economy Class
Excellent growth of First and Economy Class Share of sales by product groups change in % FY 2005/06 H2 2005/06 H1 2005/06 FY 2004/05 In millions of CHF y-o-y (in % of sales) (in % of sales) (in % of sales) (in % of sales) First Class 303 163 140 204 +48% (35%) (34%) (36%) (31%) Business Class 156 78
Slide 10: Gross profit development analysis
Gross profit development analysis In millions of CHF +3 +46 +110 577 +38% 418 Gross profit Volume Efficiencies, Forex Gross profit FY 2004/05 growth Product mix, effect FY 2005/06 Fixed costs assertion 19 Investment in key success factors Operating expenses analysis In millions of CHF FY 05/06 FY 04
Slide 11: EBIT development analysis / Solid balance sheet
EBIT development analysis In millions of CHF +46 -72 +2 +110 212 126 +68% EBIT Volume Efficiencies, Increased Forex EBIT FY 2004/05 growth Product mix, operating effect FY 2005/06 Fixed costs expenses assertion 21 Solid balance sheet Key figures balance sheet In millions of CHF FY 2005/06 FY 2004/05
Slide 12: Balance sheet structure analysis
Balance sheet structure analysis In millions of CHF FY 2005/06 FY 2004/05 Cash and cash 12 Financial debt 90 equivalents 179 173 Net financial 11 11 assets Capital employed 449 627 Equity 356 450 (in % sales) (52%) (67%) (Equity ratio) (54%) (61%) • Part of cash generation used for accelerated repay
Slide 13: Continuous improvement of the financial performance
Continuous improvement of the financial performance Sales Gross profit-margin in millions of CHF 867 in % 66.6% 660 63.3% 621 60.1% FY 03/04 FY 04/05 FY 05/06 FY 03/04 FY 04/05 FY 05/06 EBIT-margin Income after taxes-margin in % 24.4% in % 19.9% 19.0% 14.5% 15.3% 11.2% FY 03/04 FY 04/05 FY 05/06 FY
Slide 14: Outlook FY 2006/07
Media and Financial Analysts Meeting Outlook Dr. Valentin Chapero, Chief Executive Officer 27 Outlook FY 2006/07 • Savia “brand” will remain highly competitive • Strong base effect from recently launched products • Verve, microPower, Indigo and additional product launches • Sustainable market leader
Slide 15: Sales outlook FY 2006/07
Sales outlook FY 2006/07 • New marketing and product concepts have the potential to improve hearing instrument penetration rate, i.e. enlarge the market • Demographics accelerate hearing instrument market growth • Most competitive product portfolio in the hearing industry • Strong base effects from
Slide 16: Sales and EBIT outlook
Sales and EBIT outlook Sales EBIT margin In millions of CHF around 10% around 100 bps organic growth in l.c. margin expansion 24.4% 867 19.0% 660 15.3% 621 526 7.2% 1) 2002/03 2003/04 2004/05 2005/06 2006/07E 2002/03 2003/04 2004/05 2005/06 2006/07E 1) Adjusted for goodwill impairment 31 Many opport
Slide 17: New Sales and EBIT mid-term targets
New Sales and EBIT mid-term targets (for the next 3-5 years) Sales EBIT margin The leading In millions of CHF hearing system manufacturer 26-28% 867 24.4% 679 today today 33 Disclaimer This report/document may contain forward-looking statements including, but not limited to, projections of future pe