H+h International A/s · OMXCOP:HH
H+h International A/s — Q3 2019 Earnings Presentation
24 slides from H+h International A/s's earnings presentation, Nov 13, 2019
Slide 1: Investor presentation Q3 2019
Investor presentation Q3 2019 13 November 2019 Investor presentation, Q2 2019 1
Slide 2: H+H is partner in wall building across Europe
H+H is partner in wall building across Europe Introduction H+H is a wall building materials provider. The core activity is production and sale of autoclaved aerated concrete (AAC or aircrete) and calcium silicate units (CSU or sand lime bricks). The products are building blocks used for wall buildin
Slide 3: Financial highlights
Financial highlights Q3 Q1-Q3 DKK million 2019 2018 Variance 2019 2018 Variance Actual 779 720 8% 2.215 1.863 19% Revenue Organic 755 720 5% 2.044 1.863 10% Gross margin* 34% 28% 6% 31% 26% 5% Before special items 182 143 39 435 300 135 EBITDA After special items 182 127 55 435 261 174 Before specia
Slide 4: Cash flow
Cash flow Cash flow for the first three quarters of 2019 adjusted for IFRS 16 Announced capital structure in Annual Report 2018 • For the time being, H+H expects to use the free cash flow to develop the existing business and pursue value-adding investments in the form of acquisitions, within the deb
Slide 5: Outlook 2019
Outlook 2019 • Revenue growth before acquisitions and measured in local currencies is expected to be around 6% (adjusted from around 8%). • EBITDA before special items is expected to be DKK 525-545 million (a narrowing of the interval from previously DKK 510-550 million). • EBIT before special items
Slide 6: Western European segment
Western European segment Q3 Q1-Q3 DKK million 2019 2018 Variance 2019 2018 Variance Actual 531 511 4% 1.531 1.335 15% Revenue Organic 505 511 (1%) 1.418 1.335 6% Before special items 115 96 19 288 210 78 EBITDA After special items 115 82 33 288 179 109 Before special items 79 69 10 187 126 61 EBIT A
Slide 7: Eastern European segment
Eastern European segment Q3 Q1-Q3 DKK million 2019 2018 Variance 2019 2018 Variance Actual 248 209 19% 684 528 30% Revenue Organic 250 209 20% 625 528 18% Before special items 83 56 27 200 119 81 EBITDA After special items 83 56 27 200 125 75 Before special items 73 42 31 172 93 79 EBIT After specia
Slide 8: H+H International A/S has divested its Russian business
H+H International A/S has divested its Russian business Sale in line with the strategy outlined in the Annual Report 2018 • In line with the current strategy 2018 H+H have pursued opportunities to change its strategic position in the Russian market. • On 31 October 2019 H+H completed the sale of the
Slide 9: Optimizing geographic footprint
Optimizing geographic footprint • Following the divestment of Russia, H+H can increase its focus on the three core markets UK, Continental Western Europe and Poland • UK continues to be a strong market and has increased its earnings. Outlook in the mid-term remains strong • Current UK exposure of ar
Slide 10: German M&A activities
German M&A activities Status Geographic strategic focus on M&A activities • Continuous dialog with potential sellers • Market participants see a need for consolidation • H+H is in a unique situation – anti trust regulation • Different focus in the three regions ”We pursue further M&A opportunities i
Slide 11: Q&A
Q&A Investor presentation, Q3 2019 13 November 2019 11
Slide 12: Thank you
Thank you H+H International A/S Lautrupsgade 7, 5th Floor 2100 Copenhagen Ø Denmark +45 35 27 02 00 info@hplush.com www.hplush.com Investor presentation, Q3 2019 12
Slide 13: Appendices
Appendices Investor presentation, Q3 2019 13
Slide 14: Geographic footprint
Geographic footprint Investor presentation, Q3 2019 13 November 2019 14
Slide 15: External growth drivers
External growth drivers Macroeconomic Capacity utilisation Demography • GDP growth • Capacity utilisation in the • Urbanisation aircrete and calcium- • Inflation silicate industry • Housing stock • Governmental stimuli • Capacity utilisation in the • Demand for of housebuilding wall building materia
Slide 16: Risk factors
Risk factors Probability/impact Risk 2017 2018 Scenario Action Market With significant fixed costs, demand has a noticeable effect on H+H’s financial Monitoring economic and political developments in the various markets and effective sales performance. Developments in the global economy and especial
Slide 17: A powerful platform for continuing the strong development
A powerful platform for continuing the strong development Strong market position Track record Markets set for in successful growth restructuring Positive financial development Focused strategy Continuous has improved the operational flexibility of the improvements business Cyclicality, however geogr
Slide 18: The business model
The business model Investor presentation, Q3 2019 13 November 2019 18
Slide 19: Financial results
Financial results Revenue allocation 2018 EBITDA and EBIT margin development Financial gearing DKK million EBIT margin (%) EBITDA (DKK million) % DKK million Gearing Net interest-bearing debt Gearing 500 12 600 6 Western Europe, 72% Eastern Europe, 28% 400 10 400 4 300 8 200 6 200 2 UK, 32% 100 4 CW
Slide 20: Long-term trends
Long-term trends Long-term financial targets Long-term financial performance % Realised Target (range) Target (floor) 11% EBIT margin EBIT margin 15 (Operating margin before 12 9 special items) 6 At least 3 0 2014 2015 2016 2017 2018 % 20 12% ROIC ROIC 15 (Return on invested 10 capital) 5 At least 0
Slide 21: Delivering on the strategy
Delivering on the strategy Reda CSU factory • Investment for a CSU production line on current AAC site in Reda near Gdansk, Poland, has been approved. • Best location compared to competitors from a proximity perspective. • Low cost investment due to co-location with existing production facility. • T
Slide 22: H+H supports customers from the very early planning stages
H+H supports customers from the very early planning stages with a complete range of sustainable wall building solutions, process expertise and guidance on how to optimize the wall building process. Investor presentation, Q3 2019 13 November 2019 22
Slide 23: The new brand claim opens for further opportunities
The new brand claim opens for further opportunities to expand the product portfolio into other wall building materials. For the time being, restructuring within our existing products in Central Europe is top of the agenda. Investor presentation, Q3 2019 13 November 2019 23
Slide 24: More than 100 years of experience
More than 100 years of experience Investor presentation, Q3 2019 13 November 2019 24