Slide 1: Dometic Q2 2023 Report
DOMETIC Q2 2023 REPORT JULY 18, 2023 1
Slide 2: Juan Vargues, President & CEO
JUAN VARGUES PRESIDENT & CEO
Slide 3: Q2 2023 Highlights
Q2 2023 HIGHLIGHTS SOLID EARNINGS AND RECORD-HIGH OPERATING CASH FLOW Market development ▪ Macro environment and market conditions remain challenging. Inflation and interest rates create market uncertainty and shortens visibility ▪ RV industry production in the US flattened out sequentially, -50% co
Slide 4: Q2 2023 Financial Summary
Q2 2023 FINANCIAL SUMMARY Net sales of SEK 8,329 m, -2% total growth -11% ▪ -10% Organic -2% ▪ +8% FX 8,498 Net Sales ▪ 0% M&A 8,329 EBITA before i.a.c. 1,330 EBITA before i.a.c. of SEK 1,177 m (1,330) 1,177 ▪ EBITA margin of 14.1% (15.7%) Operating cash flow of SEK 2,299 m (738) Leverage remain as
Slide 5: YTD June 2023 Financial Summary
YTD JUNE 2023 FINANCIAL SUMMARY Net sales of SEK 15,618 m, -2% total growth -17% -2% ▪ -11% Organic 16,016 ▪ +8% FX Net Sales EBITA before i.a.c. ▪ 0% M&A 15,618 2,444 EBITA before i.a.c. of SEK 2,024 m (2,444) 2,024 ▪ EBITA margin of 13.0% (15.3%) Operating cash flow of SEK 2,593 m (339) EPS of SEK
Slide 6: Sales Growth Q2 2023
SALES GROWTH Q2 2023 Q2 2023 Net Sales SEK 8,329 m ▪ Total Growth -2% LTM MSEK ▪ Americas -27% 30,000 ▪ APAC 0% 25,000 ▪ Global +4% ▪ EMEA +5% 20,000 ▪ Marine +10% 15,000 ▪ Organic Growth -10% ▪ Americas -35% 10,000 ▪ Global -5% 8% 5,000 ▪ EMEA -4% -10% 0% ▪ APAC -3% 0 ▪ Marine +3% Q2 2021 Q3 2021 Q
Slide 7: Net Sales by Application Area, SEK B
NET SALES BY APPLICATION AREA, SEK B LONG TERM GROWTH DRIVEN BY POWER & CONTROL AND FOOD & BEVERAGE SEK B 30 ▪ Other Applications 11% ▪ Mainly sanitation and safety products 25 22% ▪ Driven by RV and CPV ▪ Power & Control 20 ▪ Strong performance in Marine Steering Systems 28% ▪ Structural growth in
Slide 8: Net Sales by Sales Channel, SEK B
NET SALES BY SALES CHANNEL, SEK B MORE DIVERSIFIED AND RESILIENT SALES MIX SEK B 35 30 ▪ RV OEM now 22% of Group sales vs 49% in 2017 29% 25 30% 14% 20 9% 11% 11% 27% 35% 27% 11% 30% 15 32% 28% 36% 6% 10 15% 61% 50% 44% 43% CPV OEM 5 61% 57% 54% Marine OEM 22% RVOEM 0 2017 2018 2019 2020 2021 2022 2
Slide 9: Service & Aftermarket Sales
SERVICE & AFTERMARKET SALES ▪ Retailers are destocking after high 2021 consumer demand and large purchases in 2021 and Q1 2022 2022 ▪ Q2 2023 organic decline -10% compared to: ▪ -19% in Q1 2023 2023 ▪ -22% in Q4 2022 2019 2018 2020 ▪ Continued gradual recovery expected coming quarters ▪ Marine and A
Slide 10: EBITA and EBITA Margin before i.a.c.
EBITA AND EBITA MARGIN BEFORE I.A.C EBITA before i.a.c Rolling 12 months 12.0% (14.6%) EBITA- MSEK margin Q2 2023 1.350 18% EBITA before i.a.c margin 14.1% (15.7%) 1.200 16% ‒ Decline mainly related to segment Americas 1.050 14% due to significantly lower net sales 900 12% ‒ EMEA improved sequential
Slide 11: Americas Q2 2023
AMERICAS Q2 2023 Net sales SEK 1,415 m, -27% ▪ Organic growth -35% ▪ Significantly reduced RV production ▪ Service & Aftermarket below last year, but improved trend EBITA before i.a.c. SEK -26 m (160) Net sales and EBITA margin before i.a.c. ▪ EBITA Margin -1.8% (8.2%) 2,000 10% ▪ Impact from signif
Slide 12: EMEA Q2 2023
EMEA Q2 2023 Net sales SEK 2,428 m, +5% ▪ Organic growth -4% ▪ Double-digit organic growth in OEM ▪ Service & Aftermarket sales remain low but improved trend EBITA before i.a.c. SEK 312 m (352) Net sales and EBITA margin before i.a.c. ▪ EBITA Margin 12.8% (15.2%) 2,500 20% ▪ Sales mix impact EBITA m
Slide 13: APAC Q2 2023
APAC Q2 2023 Net sales SEK 522 m, 0% ▪ Organic growth -3% ▪ Double-digit organic growth in OEM ▪ Service & Aftermarket slightly up. Distribution sales below last year EBITA before i.a.c. SEK 130 m (136) Net sales and EBITA margin before i.a.c. ▪ EBITA Margin 24.8% (26.0%) 600 35% 30% ▪ Sales mix and
Slide 14: Marine Q2 2023
MARINE Q2 2023 Net sales SEK 1,922 m, +10% ▪ Organic growth +3% ▪ Organic growth driven by OEM. Service & Aftermarket slightly up EBITA before i.a.c. SEK 495 m (485) Net sales and EBITA margin before i.a.c. 2,000 30% ▪ EBITA Margin 25.8% (27.7%) ▪ Negative sales mix 1,500 25% ▪ Q2 2022 a tough compa
Slide 15: Global Q2 2023
GLOBAL Q2 2023 Net sales SEK 2,042 m, +4% ▪ Organic growth -5% ▪ Decline in Other Global Verticals. Residential down compared to a strong 1H 2022. ▪ Hospitality organic sales stable ▪ Igloo shows low-single digit organic sales decline Net sales and EBITA margin before i.a.c. EBITA before i.a.c. SEK
Slide 16: Mobile Cooling: Igloo Products Introduced in EMEA
MOBILE COOLING IGLOO PRODUCTS INTRODUCED IN EMEA ▪ Igloo EMEA organization up and running ▪ Igloo Coolers showcased in the EMEA market at a leading industry event ISPO Munich 2023 ▪ Displayed a wide selection of products, including coolers made with recycled materials
Slide 17: Igloo ICF Coolers
IGLOO ICF COOLERS THE FIRST IGLOO COMPRESSOR COOLER ▪ Replaces Mobicool MCF Series ▪ 5 sizes – 18, 32, 40, 60 and 80L ▪ Launching October 2023 in Australia ▪ January 2024 in US and EMEA
Slide 18: Igloo TE Coolers
IGLOO TE COOLERS NEW THERMO-ELECTRIC COOLERS FOR 2024 ▪ Replaces Mobilcool TE coolers ▪ 3 sizes – 24, 27and 42L Wheeled ▪ Launching Q1 2024 in EMEA
Slide 19: The Dometic FreshJet Platform
THE DOMETIC FRESHJET PLATFORM STRONG UPTAKE OF OUR NEW SERIES OF ROOFTOP AIR CONDITIONERS ▪ A global platform of air conditioners for the RV industry Environmentally friendly, significant benefits for end users ▪ Cooling capacity +48% ▪ Noise reduction -11% ▪ Size -34% ▪ Weight -14% ▪ Energy consump
Slide 20: Cost Reductions
COST REDUCTIONS ▪ Two ongoing programs ▪ Initial program announced 2019 ▪ Next phase announced 2022 ▪ Combined annual target saving of SEK 600 m by the end of 2023 ▪ Combined cost estimated to SEK -950 m ▪ Cost in the quarter SEK -31 m. YTD SEK -49 m ▪ Closed manufacturing in Siegen, Germany. Provis
Slide 21: Sustainability
SUSTAINABILITY ▪ LTIFR1) better than target, temporarily above last year ▪ The number of injuries have decreased KPI Focus area Actual Actual 2024 Target last year compared to last year LTIFR1) People 1.9 1.7 <2.0 ▪ Implementation of Health & Safety guidelines Share of female managers People 26% 23%
Slide 22: Stefan Fristedt, CFO
STEFAN FRISTEDT CFO
Slide 23: Q2 EBITA Development
Q2 EBITA DEVELOPMENT ▪ Organic + FX EBITA before i.a.c. SEK m (% of sales) ▪ Lower net sales, mainly segment Americas ▪ Logistic costs and manufacturing inefficiencies in EMEA SEK 1,330 m (15.7%) SEK 1,177 m ▪ SG&A expenses slightly up excluding FX, 1,400 (14.1%) sales & marketing investments in str
Slide 24: Cash Flow for the Period
CASH FLOW FOR THE PERIOD Q2 2023 ▪ Operating cash flow SEK 2,299 m (738) Q2 Q2 Jan-June Jan-June SEK m 2023 2022 2023 2022 ▪ Improvement driven by reduced inventories ▪ Acquisitions SEK -418 m EBIT 985 1,166 1,652 1,978 Adjustments for non-cash items 573 563 970 936 ▪ Payment of earn-outs related to
Slide 25: Record-High Operating Cash Flow
RECORD-HIGH OPERATING CASH FLOW YEAR OVER YEAR IMPROVEMENT FOUR QUARTERS IN A ROW SEK m 2,299 1,417 1,301 1,043 1,117 917 875 738 812 724 546 311 346 294 181 84 -20 -398 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 2019 2020 2021 2022 2023
Slide 26: Working Capital
WORKING CAPITAL INVENTORIES CONTINUE TO DECLINE SEQUENTIALLY ACCOUNTS PAYABLES DAYS ACCOUNTS RECEIVABLES DAYS 70 55 ▪ Working capital 34% (28%) of net 50 sales due to Inventories 60 46 51 45 ▪ Inventory balance SEK 8,4 b (9,5) 50 40 ▪ Operational improvements more 40 35 than offsetting negative FX i
Slide 27: Capex and Research & Development
CAPEX AND RESEARCH & DEVELOPMENT (SEK m, % OF NET SALES) Q2 2023 CAPEX 1.4% (1.3%) of net sales Q2 2023 R&D 2.0% (1.7%) of net sales Includes capitalized development expenses of SEK 7 m
Slide 28: Net Debt to EBITDA Leverage
NET DEBT TO EBITDA LEVERAGE ▪ Net debt leverage ratio remains at 3.2x ▪ Negative effect from FX impact on debt ▪ Offset by strong operating cash flow 3.3 3.3 3.2 3.2 3.0 2.8 3.0 2.8 2.7 2.8 3.1 2.8 2.6 2.7 2.9 3.0 3.0 ▪ Adequate headroom to covenants 2.4 2.3 2.0 1.4 1.5 ▪ Committed on achieving our
Slide 29: Debt Maturity Profile
DEBT MATURITY PROFILE ▪ Plan to use cash at hand to repay EUR 300 m bond SEK b 0.8 maturing in September 2023 1.0 ▪ The EUR bond market remains an important long-term funding source 2.9 2.0 ▪ Key activities performed in 2023 include ▪ 3.25 year private placement bond of SEK 750 m ▪ Loan from Svensk
Slide 30: Q2 2023 Summary
Q2 2023 SUMMARY Business highlights ▪ Solid earnings and record-high operating cash flow ▪ Last quarters results show how Dometic is transforming into a more diversified, effective and resilient company ▪ Difficult to predict how macroeconomic situation will impact the business in the short-term. Ou
Slide 31: SEED ine
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Slide 32: Disclaimer
DISCLAIMER SOME STATEMENTS HEREIN ARE FORWARD-LOOKING AND THE ACTUAL OUTCOME COULD BE MATERIALLY DIFFERENT. IN ADDITION TO THE FACTORS EXPLICITLY COMMENTED UPON, THE ACTUAL OUTCOME COULD BE MATERIALLY AFFECTED BY OTHER FACTORS, (A) CHANGES IN ECONOMIC, MARKET AND COMPETITIVE CONDITIONS, (B) SUCCESS
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