Carel Industries Spa · MIL:CRL
Carel Industries Spa — 9M 2023 Earnings Presentation
41 slides from Carel Industries Spa's earnings presentation, Oct 31, 2023
Slide 1: 2023 – 9M Results
CAREL INDUSTRIES S.p.A. 2023 – 9M Results 31st October 2023 This document and all of its contents are property of CAREL. All unauthorised use, reproduction or distribution of this document or the information contained in it, by anyone other than CAREL, is severely forbidden.
Slide 2: Company presentation disclaimer
Company presentation disclaimer By attending this meeting and accepting this presentation (the “Presentation”), you will be deemed to have agreed that: (i) you will not disclose information contained herein to anyone within your firm (other than subject to these restrictions) or outside your firm an
Slide 3: Company presentation disclaimer
Company presentation disclaimer Forward-Looking Statements: this document may include projections and other “forward-looking” statements within the meaning of applicable securities laws. In particular, all statements that address expectations or projections about the future, including statements abo
Slide 4: 9M 2023 – Highlights
9M 2023 – Highlights CAREL reported again a double-digit organic revenue growth in Q3 2023, with a further increase in the Group adj. EBITDA margin. • Organic growth (LFL and constant exchange rates) stood at 12.7%, in line with the guidance given in August. +24.0% • Positive overall results in the
Slide 5: 9M 2023 – Results
9M 2023 – Results KPIs 9M 2023 Revenues bridge m€ 9M 2022 9M 2023 Δ% 52.1 497.2 Revenue 401.1 497.2 24.0% 50.8 (6.8) (1) 401.1 Organic Revenue 401.1 451.9 12.7% EBITDA 85.9 110.7 28.8% (2) Adj. EBITDA 87.7 113.0 28.9% Adj. EBITDA /Revenue 21.9% 22.7% Net Profit 52.6 59.1 12.2% Capex 15.4 15.0 -2.6%
Slide 6: 9M 2023 – Revenue breakdowns
9M 2023 – Revenue breakdowns Breakdown by region Breakdown by sector Other 1% South America 2% North America 14% Refrig. EMEA HVAC 27% 70% 497.2 72% 497.2 APAC M€ 14% M€ m€ m€ m€ m€ Area 9M 2022 9M 2023 Δ% Δ% fx Sector 9M 2022 9M 2023 Δ% Δ% fx EMEA 284.9 348.2 22.2% 22.5% HVAC 267.9 361.2 34.9% 36.4
Slide 7: From EBITDA to Net Profit
From EBITDA to Net Profit K€ 9M '22 9M '23 Δ% • Higher D&A mainly due to the EBITDA 85,918 110,705 28.8% purchase price allocation amortization. D&A -17,033 -23,137 • Higher Financial charges due to the EBIT 68,885 87,568 27.1% macro trend on interest rates and non- cash interests linked to the put-
Slide 8: 9M 2023 – NFP Bridge
9M 2023 – NFP Bridge 184.1 265.3 34.1m€ from IFRS 16 95.8 20.4 1.0 81.2 32.7m€ from 15.0 (9.7) IFRS 38.1 16 (61.7) 5.4 63.1 (23.1) 64.4 NFP Net Profit D&A Leasing/ NWC CAPEX Dividends Buy-back Other NFP 9M 2023 M&A NFP FY 2022 rent fees (no M&A) 9M 2023 m€ • Total NFP equal to 265m€, including 184m€
Slide 9: Closing Remarks
Closing Remarks • In spite of a deterioration of the macro-economic scenario, CAREL reported again a double-digit organic revenues growth in Q3 2023 compared to Q3 2022. 9M 2023 • Balanced mix between organic growth and M&A contribution led to a 24% growth in total revenues Results compared to 9M 20
Slide 10: Annexes
Annexes
Slide 11: Shareholding structure (>3% voting rights)
Shareholding structure (>3% voting rights) CAREL Industries S.p.A. CAREL Industries S.p.A. Number of shares Voting rights Other Shareholders; Luigi Rossi Luciani Other Luigi Rossi Luciani 19.85% S.a.p.a; 46.33% Shareholders; S.a.p.a; 30.99% 36.18% Capital Research and Management Company; 5.01% Capit
Slide 12: Income statement and Balance Sheet
Income statement and Balance Sheet Income statement Balance sheet K€ 9M 2023 9M 2022 Delta % K€ 9M 2023 FY 2022* Delta % Revenues 497,213 401,076 24.0% Fixed Capital 492,426 313,282 57.2% Other revenues 3,712 3,179 16.7% Working Capital 109,579 85,899 27.6% Operating costs (390,220) (318,337) 22.6%
Slide 13: Company Profile
Company Profile
Slide 14: Leading provider of advanced control solutions for HVAC/R
Leading provider of advanced control solutions for HVAC/R Key financials – 2022A • HVAC: Industrial, Residential, Growing key Commercial markets • Refrigeration: Food Retail and Revenue EBITDA EBITDA margin Net income Food Service €545m €112m ~20.5% €62m Leadership in • Control solutions premium +15
Slide 15: We operate in attractive niches across a wide range of end-markets
We operate in attractive niches across a wide range of end-markets… HVAC Refrigeration Industrial Residential Commercial Food Retail Food Service Data Centers Residential Shopping Centers Convenience Stores Restaurant Chains Industry and Process Office Space Hypermarkets Refrigerated Merchandisers P
Slide 16: One-stop-shop portfolio of components and platforms
…through a one-stop-shop portfolio of components and platforms Adiabatic humidifiers and Programmable controls HMI and unit terminals Parametric controls Isothermal humidifiers evaporative coolers Electronic controls easily programmable and customizable User interfaces for units and systems Entry le
Slide 17: Long track record of revenue growth
Long track record of revenue growth Revenue (€m) 545 420 327 332 280 255 203 231 1990s 2000A 2001A 2002A 2003A 2004A 2005A 2006A 2007A 2008A 2009A 2010A 2011A 2012A 2013A 2014A 2015A 2016A 2017A 2018A 2019A 2020A 2021A 2022A IPO & R&D Plants • 2018 – RECUPERATOR (ITA) • 2018 – HYGROMATIK (GER) • 202
Slide 18: Well-articulated strategies to continue the growth track record
Well-articulated strategies to continue the growth track record • Consolidation of HVAC market leadership • Growth in Refrigeration driven by technology leadership • Upselling and cross-selling HVAC Refrigeration • Global penetration to consolidate to increase its market leadership market share • Co
Slide 19: Leading provider of advanced energy efficient control solutions
Leading provider of advanced energy efficient control solutions 1 High-tech leader in attractive niches of the HVAC/R industry 2 Attractive growth supported by secular trends Positioning and technological innovation capability hard to 3 replicate Highly efficient global operations serving locally di
Slide 20: High-tech leader in attractive niches of the HVAC/R industry
1 High-tech leader in attractive niches of the HVAC/R industry Focus on attractive niches… …resulting in leadership positioning …CONSOLIDATED …INNOVATION-ORIENTED High value applications IN HVAC PREMIUM NICHES IN REFRIGERATION Deep knowledge of final applications is 39% #1 SIGNIFICANT ROOM FOR key E
Slide 21: Attractive market growth supported by secular trends
2 Attractive market growth supported by secular trends Secular trends… …supporting attractive market growth Reference HVAC and refrigeration Market GROWING • Improvement in LIVING STANDARDS POPULATION increasing demand for HVAC/R • Focus on WASTE REDUCTION in CHANGE IN food sector CONSUMER • Increas
Slide 22: Growth is driven by market trends and focused strategic actions
2 Growth is driven by market trends and focused strategic actions… Growth drivers SECULAR TRENDS Market Increasing the market of the applications addressed by CAREL trends NICHES EXPANSION Secular Leverage of deep knowledge of final trends applications to expand to adjacent niches Expansion to Incre
Slide 23: …and favoured by up-selling and cross-selling
2 …and favoured by up-selling and cross-selling FROM PRODUCT PLATFORMS TO INTEGRATED ELECTRONIC SOLUTIONS… PRODUCT PLATFORMS SYSTEMS From a COMBINATION OF PRODUCTS FROM DIFFERENT PLATFORMS To an ECOSYSTEM TO QUICKLY ADOPT NEW TECHNOLOGIES …IN THE HVAC AND REFRIGERATION MARKETS HVAC Refrigeration Exa
Slide 24: Positioning and innovation capability hard to replicate
3 Positioning and innovation capability hard to replicate >5% OF REVENUE1 ~12% OF TOTAL WORKFORCE Invested annually in R&D dedicated to R&D 6 R&D CENTRES PROPRIETARY SOFTWARE COMBINING 5 DOMAINS Vast library of proprietary software modules UNIQUE 01100 • Hardware & Firmware developed over the past 1
Slide 25: Leadership position in HVAC OEM premium niches
3 Leadership position in HVAC OEM premium niches… Leadership positioning in premium …with no perfect comparable niches… Chiller European Market Share OEM Large 39% proprietary diversified EM / Low cost solutions competitors competitors 27% 14% 8% Vertical niche 5% 6% approach Innovation
Slide 26: …and leading in innovation in the refrigeration market
3 …and leading in innovation in the refrigeration market Leveraging on HVAC experience… …CAREL is a leader in innovation Large diversified EM / Low cost competitors competitors 2014 HEOS SISTEMA Waterloop system with DC tech for refrigeration Vertical niche approach Innovation pace & 2015
Slide 27: Highly efficient global operations
4 Highly efficient global operations NORTH AMERICA WESTERN EUROPE NORTH APAC GLOBAL PRODUCTION FOOTPRINT 2 9 Plants Plants 232 1,220 Employees Employees DIRECT AND HIGHLY SKILLED SALES NETWORK 74 x3 201 Sales force Sales force 1 85 x3 Plant Sales force 2 3 BEST POSITIONED TO CAPTURE R&D Centre x3 R&
Slide 28: Track record of profitable growth
5 Track record of profitable growth Double-digit growth Strong profitability High conversion to net income Cash generative business Revenue1 (€m) EBITDA1 (€m) Net Income1 (€m) Operating cash2 (€m) 60 555 112 62 53 50 45 85 49 420 40 327 332 63 65 35 35 28 280 31 31 24 51 255 47 21 231 43 25 203 38 2
Slide 29: Global expansion, innovation and services
6 A Global expansion, innovation and services Pursuing additional Consolidation of opportunities leadership positions improving services in HVAC offer with IoT and Growth in advanced Refrigeration monitoring solutions Geographical Cross-selling and up- expansion through selling exploiting the introd
Slide 30: Pursuing external growth through disciplined bolt-on M&A
6 Pursuing external growth through disciplined bolt-on B M&A CAREL has performed detailed analyses and scouting of potential targets, thus promoting an opportunistic approach with a focus on 3 MAIN EXPANSION AREAS: A B C COMPLEMENTING GEOGRAPHICAL Potential selected CORE-BUSINESS EXPANSION, mainly a
Slide 31: M&A
M&A
Slide 32: M&A – 2023 – Kiona
M&A – 2023 – Kiona • Industrial fitting: Increasing R&D fire-power in digital solutions by joining CAREL and Kiona teams. Strengthening CAREL capabilities to develop and sell digital services. Opening new commercial opportunities for • Company profile: Kiona is a leading Norway-based Software
Slide 33: M&A – 2022 – Senva
M&A – 2022 – Senva • Company profile: SENVA is a US company located in Oregon specialising in the design and manufacture of a wide range of sensors, mainly in the air-conditioning and ventilation sectors, and with a significant presence in indoor air quality. • Rationale: the acquisition of SENVA is
Slide 34: M&A – 2022 – Klingenburg
M&A – 2022 – Klingenburg • Company profile: Klingenburg GmbH and Klingenburg International Sp. Z.o.o. are leading producers of a wide range of products used mainly for heat recovery in ventilation and humidification systems, adiabatic cooling and air purification. • Rationale: The transaction ration
Slide 35: M&A – 2022 – Sauber
M&A – 2022 – Sauber • Company profile: Sauber is based in Porto Mantovano (Mantua) and is active mainly in the sector of on-field installation and maintenance services for HVAC/humidification systems in commercial and residential buildings, with a strong focus on energy saving and optimization. • Ra
Slide 36: M&A – 2022 – Arion
M&A – 2022 – Arion • Company profile: Arion is the joint venture based in Bolgare (Bergamo Province - Italy), established in 2015 between CAREL and Bridgeport S.p.A. with the aim of developing sensor technology expressly dedicated to the air conditioning and refrigeration sectors. • Rationale: The t
Slide 37: M&A – 2021 – CFM
M&A – 2021 – CFM • Company profile: a long-standing distributor and partner in Turkey as well as a provider of digital and on-field services and complete high added value solutions dedicated to OEMs, contractors and end users in the Turkish HVAC (Heating, Ventilation and Air conditioning) and Refrig
Slide 38: M&A – 2021 – Enginia
M&A – 2021 – Enginia • Company profile: Enginia has been operating in the AHU sector since 1997 and has grown year after year to become a recognized leader, particularly as regards the manufacture production of dampers for air handling units. • Rationale: expansion of the product portfolio in the HV
Slide 39: M&A – 2018 – Recuperator
M&A – 2018 – Recuperator • Company profile: Recuperator is an Italy-based company active in the design, production and sale of "air-to-air" heat exchangers. • Rationale: Integration with Recuperator expands CAREL’s product portfolio in the HVAC market, consolidating its role as a supplier of complet
Slide 40: M&A – 2018 – HygroMatik
M&A – 2018 – HygroMatik • Company profile: Hygromatik is based in Henstedt- Ulzburg, near Hamburg. It designs, produces and markets humidifiers and related accessories, in the industrial, commercial and wellness field. • Rationale: integration with HygroMatik will consolidate Carel's positioning in
Slide 41: This document and all of its contents are property of CAREL. All unauthorised use,
41 This document and all of its contents are property of CAREL. All unauthorised use, reproduction or distribution of this document or the information contained in it, by anyone other than CAREL, is severely forbidden.