Evs Broadcast Equipment Sa · EURONEXT:EVS
Evs Broadcast Equipment Sa — Q4 2018 Earnings Presentation
36 slides from Evs Broadcast Equipment Sa's earnings presentation, Feb 21, 2019
Slide 1: EVS Broadcast Equipment Results 4Q 2018
EVS BROADCAST EQUIPMENT RESULTS 4Q 2018 Dr. Pierre DE MUELENAERE, Chairman of the Board & Interim CEO Yvan ABSIL, CFO Geoffroy d’‘OULTREMONT, VP Investor Relations & Corporate Communication =VSE
Slide 2: Agenda
AGENDA Business update >» Dr. Pierre De Muelenaere, Chairman of the Board and Interim CEO =V5& Financial update » Yvan Absil, CFO Guidance D Dr. Pierre De Muelenaere » Yvan Absil Conclusions D Dr. Pierre De Muelenaere Questions & Answers
Slide 3: Business Update - Topics
BUSINESS UPDATE - TOPICS EVS - Key facts Special situation in H1-2018 Action plan for H2-2018 4Q and FY18 Results Guidance =V5&
Slide 4: EVS key facts
Founded in 1994 (Pierre Lhoest, Laurent Minguet, Michel Counson) Profitable since more than 20 years Listed since 1998 A World-wide Leader in Live Slow Motion A Grow and Maintain Strategy A Big Events (e.g. Olympic games) impact every 2 years A highly profitable company (EBIT Margin >20%) A strong n
Slide 5: EVS Live Focus
oa EVS LIVE FOCUS MISSION We design cutting edge video production technologies and solutions to create unique stories out of every live events =V5
Slide 6: Our Customers
OUR CUSTOMERS =V5 PRODUCTION COMPANIES STUDIO & TV STATIONS SPORT FEDERATION & LEAGUES OTHER Teams stadiums, e-Sports, etc.
Slide 7: Global Footprint in High-End Live Productions
GLOBAL FOOTPRINT IN HIGH-END LIVE PRODUCTIONS I=Net Ae 7 7 © ids Q_skymeni~ | 2 Rey DIRECTY. dish . reor all SBS (Comcast ie ee: rok alo oS a, ape OCI — p ee SPORT FOX = aw 2 ann igiturk 2 =V5
Slide 8: EVS Business
EVS Business BUSINESS | A Grow and Maintain Strategy XT ecosystem for OB vans and broadcast centers New products and solutions New markets
Slide 9: Maintain: EVS is a strong leader in live video production
MAINTAIN: EVS IS A STRONG LEADER IN LIVE VIDEO PRODUCTION AND WORKS HARD TO MAINTAIN ITS MARKET SHARE AND REVENUE =V5 Maintain a strong ecosystem around the XT platform Adapt to support latest technology evolutions — |IP-smtp2110 - 4K — Remote production — Etc Maintain presence in OB Vans (outside B
Slide 10: Boosted Density
BOOSTED DENSITY 1M / 6CH UHD-4K (2160p) / +12 CHANNELS OF / +12 CHANNELS OF HD (720p/1 / HDR SUPPORT / NEW PROXY H.264 HDR [¥.264| UHD_M& 1080p =V5
Slide 11: Grow: new solutions for new applications
GROW: EVS IS DEVELOPING A RANGE OF NEW SOLUTIONS FOR NEW APPLICATIONS DYVI_ 7 » Find new growth opportunities by Live Video Production leveraging the IP technologies Switcher Extend the product portfolio leading toa EEBRA ///f larger customer reach — E-sports — |T corporates — Referee - leagues — Sm
Slide 12: EVS products powered by artificial intelligence
1 EVS PRODUCTS POWERED BY ARTIFICIAL INTELLIGENCE PROVIDE UNIQUE 2 BENEFITS TO CUSTOMERS AND REDUCE COST » Artificial intelligence used by EVS innovation and development teams to empower and simplify live productions Off-side-line through automatic player and pitch detection => no calibration needed
Slide 13: 1H18 was the weakest first half of the last years
1H18 WAS THE WEAKEST FIRST HALF OF THE LAST 5 YEARS H1 evolution [in m€) 70 65 67 60 53 47 50 bb 40 30 23 25 20 15 7 13 9 1 : UJ | ; | — = Revenues EBIT Net Profit @H1 2014 @H12015 @H12016 @H12017 mH1 2018 =V5
Slide 14: EVS was facing a special situation in H1-2018
14 EVS WAS FACING A SPECIAL SITUATION IN H1-2018 D The EVS board has been reshuffled with two leavers and First half revenue two newcomers (Dr. Pierre De Muelenaere and Vincent 70 6&9 ee 60 52.8 Werbrouck] «» Wh has > Pierre mission was to improve stability and efficiency of 40 the Board 30 20 D The
Slide 15: The boards decided that a special action plan was needed
15 THE BOARDS DECIDED THAT A SPECIAL ACTION PLAN WAS NEEDED » With the help of EVS Management, a Fight-Back Plan has been designed for 2H2018: D Improve OPEX D Maximize the impact of commercial actions D Maximize EBIT > With Strong support of the Board and the management, the Fight-Back plan has bee
Slide 16: EVS has beaten the OPEX guidance
16 THANKS TO STRONG ACTIONS, EVS HAS BEATEN THE OPEX GUIDANCE D Original OPEX Guidance: moderate growth on top of the structural salary increase (+2%]} in Belgium {analyst consensus in Feb. 2018: + 6-8%) Opex evolution 58 56.8 | -EUR 3.4 million | 3.4 million > Reported 2018 OPEX: | SS 55 +0.5% 54 a
Slide 17: New key products released and significant deals won
THANKS TO THE COMMITMENT OF ALL EVS TEAMS, NEW KEY PRODUCTS HAVE BEEN RELEASED AND SIGNIFICANT DEALS HAVE BEEN WON! 17 Products Some customer wins > Shipping of XT-Via (August 2018) > XT-Via: NHK (Japan), Gravity Media Group (with Multicam upgrades), CSM (Chinal, DP Launch of Xeebra 2.0, including t
Slide 18: Gravity Media Group meets growing UHD-4K content demand
18 GRAVITY MEDIA GROUP MEETS GROWING UHD-4K CONTENT DEMAND WITH MAJOR EVS TECHNOLOGY INVESTMENT Scope: Upgrade of its entire EVS fleet to Multicam 16.0 operating system New XT-VIA servers wi Advantage: Deliver expanded capabilities for its customers Better meet the demands of today’s production envi
Slide 19: Business of EVS in 2H18 was much better
19 WITH STRONG ACTIONS, THE BUSINESS OF EVS IN 2H18 WAS MUCH BETTER >» H2is record compared to previous years * 2H revenue DEVS team worked hard to make a strong H2 m1 72.0 ») The XT-Via platform is ready for 4K, IP, 1080p, HDR and future proof for new projects D The DYVI switcher is based on breakt
Slide 20: Conclusion: 2H18 was record compared to last years
CONCLUSION: 2H18 WAS RECORD COMPARED TO THE LAST 5 YEARS 20 H2 evolution [in m€) n 70 66 44 66 60 50 40 30 23 23 25.7 95 20 1718 15°15 BUG) anual 0 Revenues EBIT Net Profit WH22014 @H22015 MH22016 @H22017 mH2 2018
Slide 21: Agenda
AGENDA 21 Business update >» Dr. Pierre De Muelenaere, Chairman of the Board and Interim CEO Financial update » Yvan Absil, CFO =V5 Guidance D Dr. Pierre De Muelenaere » Yvan Absil Conclusions D Dr. Pierre De Muelenaere Questions & Answers
Slide 22: FY18 Highlights
22 FY18 HIGHLIGHTS BETTER MOMENTUM IN 2H18 AFTER WEAK 1H18 D FY Revenue > In line with guidance » Traction from XT-Via platform and maximization of the impact of commercial actions in 2H18 » Continued challenging market conditions D FY Profitability » Steady gross margin D> Opex control [+0.5% yoy),
Slide 23: 1.3 0.6 3.9 21.8 8.2 16.7 13.6 18.6 0.2 1.0 4.0 0.0 0.7 1.7
1.3 0.6 3.9 21.8 8.2 16.7 13.6 18.6 0.2 1.0 4.0 0.0 0.7 1.7 12.4 10.7 7.2 14.9 11.8 13.5 7.1 4.2 11.6 3.8 11.4 8.9 8.9 11.0 24.3 21.0 22.2 20.6 17.0 16.5 17.4 16.6 13.1 15.1 13.5 14.0 14.2 12.7 9.7 6.4 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 2015 2016 2017 2018
Slide 24: 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 2015 2016 2017 2018 2015 2016 2017 2018
Slide 25: 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 2015 2016 2017 2018 2015 2016 2017 2018
Slide 26: Consolidated Income Statement 4Q 2018
26 CONSOLIDATED INCOME STATEMENT 4Q 2018 In millions of EUR 4Q18 4Q17 D Revenue: +6.6% yoy REVENUE 42.3 39.7 > Gross margin: -0.3ppt yoy Cost of sales -9.7 -9.0 » Better product mix Gross profit 32.6 30.8 © Write-offs j 9 9 Gross margin 77.1% 77.4% > OPEX: -0.9% yoy S&A -7.8 -7.8 * Lower consulting
Slide 27: Consolidated Income Statement FY 2018
27 CONSOLIDATED INCOME STATEMENT FY 2018 >» Revenue: -2.3% yoy In millions of EUR FY18 FY47 > Gross margin: -2.6ppt yoy REVENUE 116.1 118.8 + Product mix Cost of sales -33.5 -31.2 > OPEX: +0.5% . 1 +U.070 yoy Gross profit 82.5 87.6 + Strict cost management and recruitment Gross margin % 71.1% 73.7%
Slide 28: Strong Balance Sheet
28 STRONG BALANCE SHEET D EUR 32.0 million net cash from operating activities in 2018 (compared to EUR 11.6 million in 2017] » Total equity of EUR 141.3 million [+EUR 36.0 million since the end of 2017) >» EUR 58.5 million net cash position at the end of 2018 > Capital increase on December 26, 2018:
Slide 29: Agenda
AGENDA 29 Business update >» Dr. Pierre De Muelenaere, Chairman of the Board and Interim CEO Financial update » Yvan Absil, CFO Guidance D Dr. Pierre De Muelenaere » Yvan Absil =V5 Conclusions D Dr. Pierre De Muelenaere Questions & Answers
Slide 30: Order book @ February 15: EUR 26.7 million
ORDER BOOK @ FEBRUARY 15: EUR 26.7 MILLION 30 D 2019 order book is -28.8% compared to last year, but - 0.7% excl. Big events rentals D Around 75% should be recognized as revenue in H1 D 50% of the order book related to OB » Current 2019 order book doe not include any big event rentals D In addition,
Slide 31: Guidance
31 GUIDANCE We made some changes in our financial communication to take into account the feedback received from investors over the last months D> 2019 financial outlook » Change: guidance given earlier, in February (instead of May) D Revenue: EUR 100-120 million D Opex: less than +2% » Dividend » Ch
Slide 32: New Dividend Policy
32 NEW DIVIDEND POLICY Evolution of dividend in EUR per share @ Final dividend [May] @ Interim Dividend (November) 1.30 1.00 1.00 1.00 1.00 1.00 1.00 0.50 0.60 0.50 0.50 0.50 2015 2016 2017 2018 2019e 2020e * Payout 56.8% 53.5% 56.5% 37.9% ** Yield 3.5% 4.2% 3.0% 4.3% Subject to reasonable market co
Slide 33: Agenda
AGENDA 33 Business update >» Dr. Pierre De Muelenaere, Chairman of the Board and Interim CEO Financial update » Yvan Absil, CFO Guidance D Dr. Pierre De Muelenaere » Yvan Absil Conclusions D Dr. Pierre De Muelenaere =V5 Questions & Answers
Slide 34: Conclusions
34 CONCLUSIONS > Aspecial year for EVS >» Astrong action plan with special commitment from all EVS Teams in H2 >» Great products released by the R&D ! > Important wins by the sales team ! D» 2018 numbers in line with latest guidance D Strongest H2 since 10 years (revenue and EBIT) D Improved financi
Slide 35: of emotions
of emotions
Slide 36: Geoffroy d'Oultremont
Geoffroy d’Oultremont VP Investor Relations & Corporate Communications Corpcom@evs.com Tel: +32 4 361 70 13
EVS Broadcast Equipment — Q4 2018 Earnings Presentation on 6ix