Theon International Plc · EURONEXT:THEON
Theon International — H1 2024 Earnings Presentation
22 slides from Theon International's earnings presentation, Sep 10, 2024
Slide 1: H1 2024 Results
H1 2024 Results 10 September 2024
Slide 2: Disclaimer
DISCLAIMER Important - please read the following before continuing. This document has been prepared by Theon International PLC (the "Company") solely for discussion purposes in relation to the Company and its subsidiaries (together, the "Group"), for information and background purposes only (the "In
Slide 3: Agenda
AGENDA Overview & Key Highlights 1 Christian Hadjiminas, Chief Executive Officer 2 Acquisition of Harder Digital Christian Hadjiminas, Chief Executive Officer Market & Business Update 3 Philippe Mennicken, Business Development Director H1 2024 Results & Outlook 4 Dimitris Parthenis, Chief Financial
Slide 4: Overview & Key Highlights
Overview & Key Highlights Christian Hadjiminas, Chief Executive Officer 3
Slide 5: H1 2024 Overview
H1 2024 OVERVIEW Another solid set of results, with strong financial performance coupled with tangible progresses in delivering on strategy Strong H1 performance Healthy order book with Delivering on strategy underpinned by high visible pipeline of across M&A, product unprecedented growth and contra
Slide 6: Continued Strong Financial Performance
CONTINUED STRONG FINANCIAL PERFORMANCE Revenue visibility, strong growth and profitability, and solid balance sheet €77.0 m Order intake1 €427.0 m Soft order backlog €152.4 m Revenue 0.5x book-to-bill ratio 1.3x revenue guidance for FY242 160.7% growth y-o-y €36.9 m Adj. EBIT €53.3 m Net cash3 €14.4
Slide 7: Delivering Against Our Strategy for Growth
DELIVERING AGAINST OUR STRATEGY FOR GROWTH Substantial progress across M&A, product innovation, supply chain and geographic expansion New service center in Harder Digital acquisition Denmark Production facility in Active discussions with South Korea identified targets Built-up strategic inventory A.
Slide 8: Acquisition of Harder Digital
Acquisition of Harder Digital Christian Hadjiminas, Chief Executive Officer 7
Slide 9: Company Overview
COMPANY OVERVIEW Harder Digital is a European Image Intensifier Tube (IIT) manufacturer Established in 1999 with HQ in Woltersdorf, Germany and presence in Serbia and Latvia Approx. 200 employees Key products Vertically integrated IIT manufacturer providing Gen II Gen III Custom Detectors customized
Slide 10: Strategic Rationale
STRATEGIC RATIONALE Theon delivers on its growth strategy with this acquisition, as well as expanding its technological capabilities and insourcing critical supply chain components Insourcing a critical component of the Night Vision value chain, enhancing operational security and flexibility Access
Slide 11: Acquisition Financials and Structure
ACQUISITION FINANCIALS AND STRUCTURE Acquisition of 60% controlling stake through cash capital increase, expected to bring significant synergies • Enterprise Value of €35 m, incl. €12 m of debt Valuation • Mid-single digit EV / EBITDA 2026 • Targeting €17 m sales with 10% EBITDA in 2024, and expect
Slide 12: Market & Business Update
Market & Business Update Philippe Mennicken, Business Development Director 11
Slide 13: Market Environment
MARKET ENVIRONMENT Increased global conflicts driving higher defense spending and rapid military technology advancements • Ongoing war in Ukraine with an unpredictable outcome and shifting battlefield dynamics • Gaza conflict with a continued risk of escalating into a broader regional conflict Geopo
Slide 14: Night Vision Modernisation
NIGHT VISION MODERNISATION Ensuring operational superiority through enhanced equipment, training, and interoperability amidst growing demand and global conflict impact Use of advanced sensors for dismounted The drone-dominated battlefield in the Ukraine infantry is a key focus of modernization war i
Slide 15: Global Momentum Provides Visibility
GLOBAL MOMENTUM PROVIDES VISIBILITY North America, Europe and APAC are the largest contributors as users seek to re-orient to combat near peer threats, and recap key capability – MENA steadier but remains high. Total addressable NV market sums up to $7.5 billion in 2024-2029 period Europe • Continue
Slide 16: H1 2024 Results & Outlook
H1 2024 Results & Outlook Dimitris Parthenis, Chief Financial Officer 15
Slide 17: >160% Revenue Growth Leads to Record Results
>160% REVENUE GROWTH LEADS TO RECORD RESULTS Order intake (€ m) Revenue (€ m) Commentary Increased order intake, which is +35.1% +160.7% expected to accelerate in H2, in line with traditional weighting and the pending demand in the market Strong revenue growth driven both by new contracts and de
Slide 18: Soft Backlog Provides Visibility
SOFT BACKLOG PROVIDES VISIBILITY Soft backlog and options (€ m) Commentary Approx. 40% of the Soft backlog is expected to be invoiced in 2024, 50% in 2025 and 10% from 2026 onwards ~590.0 ~1,017.0 Options on Soft backlog increased and are substantiated by the customers' needs ~136.0 ~427.0 ~291.
Slide 19: Strong Profitability – Higher Margins Compared to Last Year
STRONG PROFITABILITY – HIGHER MARGINS COMPARED TO LAST YEAR Adj. EBITDA (€ m) Adj. EBIT (€ m) Commentary Strong H1 performance, with material +252.6% +270.3% step-up in profitability vs last year Margins in line with guidance 18.4% 24.9% 17.1% 24.2% Growth and increased volumes resulting in im
Slide 20: Solid Balance Sheet
SOLID BALANCE SHEET Net debt / (cash) (€ m) Commentary Net cash position fuelled by IPO cash proceeds, ready to be deployed for future investments Bank debt of €60.7 m (incl. leases) FY 2023 H1 2024 ~60% of which is L-T Debt (0.1) Capex of €5.1 m (3.3% of revenues), in line with full year 2
Slide 21: Outlook – Guidance Confirmed
OUTLOOK – GUIDANCE CONFIRMED 2024 target Medium term target Revenue €330-350 m Growth in line with addressable market EBIT margin Mid-twenties Mid-twenties Capex as % of revenue in line with historical levels Capex €10 m excluding Athens facility expansion 40% Dividend payout Dividend payout 30-40%
Slide 22: Q&A
Q&A