Komax Holding Ag · SIX:KOMN
Komax — FY2018 Earnings Presentation
43 slides from Komax's earnings presentation, Mar 14, 2019
Slide 1: Results 2018 and Outlook 2019
RESULTS 2018 AND OUTLOOK 2019 14 March 2019 14 March 2019 / Results 2018 and Outlook 2019 / 1
Slide 2: 2018 in brief
2018 in brief Expansion of market leadership Strong growth in order intake and revenues, accompanied by an increase in profitability High level of investment Research and development (numerous product launches) Internal and external digitalization Capacity expansion (Switzerland, Germany
Slide 3: Order intake up 10.4%
Order intake up 10.4% Growth outstrips the market in CHF million Very good first six months, dip in order intake towards the end of 2018 600 H1 2018: CHF 256.0 million 496.7 H2 2018: CHF 240.7 million 500 449.7 400 300 200 100 0 Order intake 2017 2018 14 March 2019 / Results 2018 and Outlook
Slide 4: 17.4% growth in revenues
17.4% growth in revenues Breakdown of revenue growth Organic growth: +13.9% in CHF million Acquisition-driven growth: +1.7% 600 Foreign currency impact: +1.8% 500 479.7 Continued impressive growth in revenues throughout the year due to strong order backlog 408.5 400 H1 2018: CHF 236.9 mi
Slide 5: Clear increase in profitability
Clear increase in profitability EBIT higher in first six months H1 2018: CHF 35.7 million in CHF million H2 2018: CHF 31.6 million 80 20% EBIT margin impacted by developments in 67.3 foreign currencies 60 15% H1 2018: 15.1% 55.1 (foreign currency impact: +1.3 ppts, 14.0% 13.5% sale of buil
Slide 6: Agenda
AGENDA 1 2018 financial year: financial performance 2 2017–2021 strategy: focus on core market 3 Focus and outlook 2019 4 Questions 14 March 2019 / Results 2018 and Outlook 2019 / 6
Slide 7: Strong growth in all regions
Strong growth in all regions Revenues by region in 2018 Change from previous year -10% 0% 10% 20% 30% 40% 50% 60% 2% 13% -4.4% Switzerland Switzerland 3.3% Europe Europe 26.5% Asia/Pacific 21% 43% Asia/Pacific 29.0% North/South America North/South America 49.8% Africa Africa 17.4% Total 21% Resource
Slide 8: Innovation as driver of success
Innovation as driver of success R&D investments up 12% in CHF million Annual R&D spending at 8%–9% Technological shift in automotive industry (e-mobility, 50 10% 9.0% autonomous driving, etc.) creating opportunities for 8.6% further unique selling propositions 40 8% 41.1 217 R&D staff; plus
Slide 9: EBIT up 22.1%
EBIT up 22.1% in CHF million 41.4 –20.4 –0.3 –8.5 55.1 Personnel expenses 67.3 Gross profit margin in % of revenues 2018: 62.1% 2018: 32.8% (product mix) Personnel expenses - Higher volume Gross profit margin in % of revenues - Higher variable 2017: 62.8% 2017: 33.5% costs EBIT 2017 Gross profit Per
Slide 10: Substantial movements in currencies
Substantial movements in currencies Revenues by currency 115 110 105 10% 100 13% EUR 95 USD 46% 90 CNY 14% CHF 85 12.16 02.17 04.17 06.17 08.17 10.17 12.17 02.18 04.18 06.18 08.18 10.18 12.18 Others 17% EUR (Basis: 1.09) USD (Basis: 1.03) CNY (Basis: 0.1484) Foreign currency impact 2018 revenues:
Slide 11: 23.0% increase in Group profit after taxes (EAT)
23.0% increase in Group profit after taxes (EAT) Negative financial result (CHF –5.2 million) impacts on profit (financial result 2017: CHF –0.8 million) in CHF million CHF 3.0 million of this financial result is attributable to 60 unrealized book losses mainly on currencies of 51.8 emerging mar
Slide 12: High level of investment activity impacting free cash flow
High level of investment activity impacting free cash flow 11.4 in CHF million 51.8 –33.5 –34.0 –4.0 59.3 Dividends Free cash flow CHF –4.3 million (2017: CHF –7.6 million) 246.2 CHF –24.9 million 51.0 Increase in Increase in cash flow from operating activities financial liabilities from CHF 26.8 mi
Slide 13: Investment volume remains high
Investment volume remains high Gross investment Net investment (excl. acquisition and sale of companies): (excl. acquisition and sale of companies) CHF 31.7 million (2017: CHF 21.3 million) Tangible assets (CHF 28.8 million) 10% Intangible assets (CHF 4.2 million) 8% Decrease in granted loan
Slide 14: Investment in capacity expansion
Investment in capacity expansion Construction projects in Switzerland, Germany and Hungary Komax, Dierikon (CH) Komax SLE, Grafenau (DE) Kabatec, Burghaun (DE) Sharp jump in CAPEX due to high investment volumes for capacity expansion CAPEX 2018: CHF 41 million 2019: approx. CHF 80–90 million
Slide 15: Increased credit limit for syndicated loan
Increased credit limit for syndicated loan High level of investment secured by increase in credit limit for syndicated loan facility in CHF million Loan in the amount of CHF 160 million through a 200 bank syndicate (2017: CHF 140 million) 180 160 Term until January 2022 150 (plus option for ex
Slide 16: Continued strong financial base
Continued strong financial base Continued high equity ratio in CHF million Net debt of CHF 39.4 million (2017: CHF 10.5 million) 500 75% 463 Retained earnings of CHF 259.0 million 414 62.3% (2017: CHF 233.2 million) 400 60.8% 60% 300 282 45% 258 200 30% 100 15% Total assets Shareholders’ equit
Slide 17: RONCE rises from already high level
RONCE rises from already high level RONCE: 25.2% (2017: 23.8%) in CHF million Strategic target 2017–2021: RONCE average 25% Robust management of net working capital (NWC) 300 283 Ongoing improvement and acceleration of 250 248 internal processes 204 Stringent accounts receivable management
Slide 18: Attractive dividend yield
Attractive dividend yield Payout of CHF 7.00 per share proposed in CHF Of which CHF 6.20 as dividend and CHF 0.80 350 as distribution from capital contribution reserves 300 Payout ratio 52.0% 250 (strategic bandwidth: 50%–60%) 200 150 1 2014 2015 2016 2017 2018 100 50 Distribution per share in
Slide 19: Agenda
AGENDA 1 2018 financial year: financial performance 2 2017–2021 strategy: focus on core market 3 Focus and outlook 2019 4 Questions 14 March 2019 / Results 2018 and Outlook 2019 / 19
Slide 20: We stand for...
We stand for... GROWTH PREDICTABILITY VALUE FOCUSED GENERATION STRATEGY SOLIDITY ROBUSTNESS FINANCIAL MARKET STABILITY LEADER PROFITABILITY BRAND STRENGTH 14 March 2019 / Results 2018 and Outlook 2019 / 20
Slide 21: Focused strategy
Focused strategy Four key priorities for the automation of wire processing Solutions along the Innovative production Global customer Development of non- value chain concepts proximity automotive markets 14 March 2019 / Results 2018 and Outlook 2019 / 21
Slide 22: Strategic priorities: Solutions along the value chain
Strategic priorities Solutions along the value chain Solutions along the Innovative production Global customer Development of non- value chain concepts proximity automotive markets 14 March 2019 / Results 2018 and Outlook 2019 / 22
Slide 23: Komax offers solutions for every stage of customers' value chain
Komax offers solutions for every stage of customers’ value chain Proportion of time spent per wire harness Cutting, crimping, 9% block loading, etc. 20% Pre-assembly, taping 9% Routing 9% Attaching clips, etc. 25% Testing 28% Packaging 14 March 2019 / Results 2018 and Outlook 2019 / 23
Slide 24: Strategic priorities: Innovative production concepts
Strategic priorities Innovative production concepts Solutions along the Innovative production Global customer Development of non- value chain concepts proximity automotive markets 14 March 2019 / Results 2018 and Outlook 2019 / 24
Slide 25: Continued significant investment in R&D
Continued significant investment in R&D Broadest product portfolio to meet changing market needs Launch of a number of new (digital) solutions to offer customers additional unique selling propositions 14 March 2019 / Results 2018 and Outlook 2019 / 25
Slide 26: Development of e-mobility
Development of e-mobility Center of competence at Komax Thonauer in Budakeszi (Hungary) 100% 90% 80% Internal cumbustion engine (ICE) 70% Internal cumbustion engine (ICE) Stop/Start 60% Mild hybrid (MHEV) 50% 40% Full hybrid (HEV) 30% Plug-in hybrid (PHEV) 20% Battery electric vehicle (BEV) 10% 0% 2
Slide 27: Strategic priorities: Global customer proximity
Strategic priorities Global customer proximity Solutions along the Innovative production Global customer Development of non- value chain concepts proximity automotive markets 14 March 2019 / Results 2018 and Outlook 2019 / 27
Slide 28: Global local
Global local The world’s largest sales, engineering, and service network Tangier Foundation of Komax TSK Maroc Vehicle production Wire harness Komax site production Sales representative 14 March 2019 / Results 2018 and Outlook 2019 / 28
Slide 29: Strengthening of position in North America
Strengthening of position in North America Acquisition of Artos Engineering and asset deal with TE Connectivity Founded in 1911 Deal completed end of 2018 Own product portfolio with TE Connectivity’s Application Tooling Wealth of experience in developing innovative business unit applications
Slide 30: Largest installed base in the world
Largest installed base in the world Komax machines on all continents Continuous recurring earnings create stability – even during brief downturns Diversified customer portfolio (including key accounts, small regional companies, all OEMs) ~ 20 Crimp to crimp machines ~ 20 Other machines 14 March
Slide 31: Strategic priorities: Development of non-automotive markets
Strategic priorities Development of non-automotive markets Solutions along the Innovative production Global customer Development of non- value chain concepts proximity automotive markets 14 March 2019 / Results 2018 and Outlook 2019 / 31
Slide 32: Rigorous development of non-automotive markets
Rigorous development of non-automotive markets Aerospace Data/Telecom Industrial Non-automotive markets make a substantial contribution to revenues, accounting for less than 20% Selective and complementary build-up of competencies in non-automotive areas supports success of core business 14 Marc
Slide 33: What's next?
WHAT'S NEXT? 14 March 2019 / Results 2018 and Outlook 2019 / 33
Slide 34: Global megatrends in the automotive industry
Global megatrends in the automotive industry 14 March 2019 / Results 2018 and Outlook 2019 / 34
Slide 35: Increasing electrification
Increasing electrification 14 March 2019 / Results 2018 and Outlook 2019 / 35
Slide 36: Constant rise in pressure to automate
Constant rise in pressure to automate in addition: rising wage costs 2%–3% CAGR over 5 years miniaturization autonomous driving Rising number of vehicles produced CAGR 2015–2021: approx. 2%–3% staff availability Expectations for 2019 traceability 1.2% growth of automotive production e-mobility risin
Slide 37: 2017-2021 strategy
2017–2021 strategy ambitious targets, attractive dividend policy 2021 2021 2017–2021 2017–2021 CHF CHF 500–600 80–100 Avg. 25% 50%–60% million million of EAT Revenues EBIT RONCE Payout 14 March 2019 / Results 2018 and Outlook 2019 / 37
Slide 38: Agenda
AGENDA 1 2018 financial year: financial performance 2 2017–2021 strategy: focus on core market 3 Focus and outlook 2019 4 Questions 14 March 2019 / Results 2018 and Outlook 2019 / 38
Slide 39: Priority areas 2019
Priority areas 2019 Mastering the challenges presented by the current market situation Strengthening global customer proximity (distribution/service) Creation of further unique selling propositions through research and development Automation solutions Quality products Digital, connected
Slide 40: Outlook
Outlook The Komax Group continues to be well on track in the implementation of its 2017–2021 strategy. 2018 was a record year, enabling the Group to start off 2019 with strong order backlog. The uncertainty in the automotive industry means that investment decisions are being delayed. However,
Slide 41: Contact / Financial calendar
Contact / Financial calendar Contact Financial calendar Roger Müller Annual General Meeting 16 April 2019 Industriestrasse 6 6036 Dierikon Dividend payment 24 April 2019 Switzerland Phone +41 41 455 06 16 Half-year results 2019 20 August 2019 roger.mueller@komaxgroup.com Preliminary information on 2
Slide 42: Disclaimer
Disclaimer This presentation contains forward-looking statements in relation to Komax which are based on current assumptions and expectations. Unforeseeable events and developments could cause actual results to differ materially from those anticipated. Examples include: changes in the economic and l
Slide 43: Results 2018 and Outlook 2019
RESULTS 2018 AND OUTLOOK 2019 14 March 2019 14 March 2019 / Results 2018 and Outlook 2019 / 43