Interpump Group S.p.a. · MIL:IP
Interpump — Q3 2023 Earnings Presentation
43 slides from Interpump's earnings presentation, Nov 10, 2023
Slide 1: Interpump Group 3Q-3QYTD2023 Financial Results
INTERPUMP GROUP 3Q-3QYTD2023 FINANCIAL RESULTS 10th November 2023
Slide 2: Index
INDEX • KEY HIGHLIGHTS • 3Q-3Q2023YTD FINANCIAL RESULTS • GROUP SUSTAINABILITY PATH • OUTLOOK • ANNEX 1
Slide 3: 3Q-3Q2023YTD Key Highlights
3Q-3Q2023YTD KEY HIGHLIGHTS 2
Slide 4: 3Q-3Q2023YTD Group – Delivering on Commitments
3Q-3Q2023YTD GROUP – DELIVERING ON COMMITMENTS ▪ 3Q-3Q2023YTD results: delivering on commitments ‒ Financials: delivering on organic growth, margin increase and FCF improvement • Sales: growth on growth • Profitability: another step towards a new record • NFP: record profitability exploited in mater
Slide 5: 3Q-3Q2023YTD Financial Results
3Q-3Q2023YTD FINANCIAL RESULTS 4
Slide 6: 3Q-3Q2023YTD Group – Delivering Excellence and Resilience
3Q-3Q2023YTD GROUP – DELIVERING EXCELLENCE AND RESILIENCE ▪ 3Q-3Q2023YTD ‒ Sales: “diversification” drove growth on growth, +4% on top of almost +16% of 3Q2022 − Profitability: “Read the Market and adapt Operations” drove to 24.3%, best 3Quarter ever ‒ NFP: “convert Profitability in Cash” drove to c
Slide 7: 3Q-3QYTD2023 Divisions – Margin Improvement in All Conditions
3Q-3QYTD2023 DIVISIONS – MARGIN IMPROVEMENT IN ALL CONDITIONS ▪ 3Q2023 − Hydraulics • Sales: market normalisation ongoing • Profitability: Group actions stronger than normalisation − Water-Jetting • Sales: business “late-cyclical” nature strengthened by “complete solution” products • EBITDA: diluiti
Slide 8: 3Q-3Q2023YTD Sales – Diversification Drove Growth on Growth
3Q-3Q2023YTD SALES – DIVERSIFICATION DROVE GROWTH ON GROWTH ▪ 3Q2023: organically, +4% on top of almost +16% of 3Q2022 – Almost +18% in 3Q2021 ▪ Evolution consistent with division nature and Group yearly expectation − Hydraulic: market normalisation, with “PTO’s & cylinders” balancing “orbital motor
Slide 9: 3Q-3Q2023YTD Sales – Diversification Drove Growth on Growth (Divisions)
3Q-3Q2023YTD SALES – DIVERSIFICATION DROVE GROWTH ON GROWTH 3Q2023 SALES EVOLUTION 3Q2023YTD SALES EVOLUTION +0.4% +10.5% +10.0% +2.0% -1.5% € 1.269m € 1.148m HYDRAULIC +2.3% +1.4% -3.3% € 382m € 384m +11.5% +14.0% +4.2% WATER-JETTING -1.9% € 452m +11.7% € 396m +8.0% -5.2% € 152m +8.7% € 136m 8
Slide 10: 3Q-3Q2023YTD NFP – Cash Generation from TWC
3Q-3Q2023YTD NFP – CASH GENERATION FROM TWC ▪ NFP was € 526m compared to € 542m of December 2022(1) NFP EVOLUTION (1) (€ m) ▪ FCF from € 22m to € 101m, delivering improvement 542 (101) 34 (2) (5) 1 526 commitment 57 – TWC: leveraging on 3Quarter cash generation, cash absorption was reduced by almost
Slide 11: 3Q-3Q2023YTD NFP – CAPEX – Production Capacity Improvement
3Q-3Q2023YTD NFP – CAPEX – PRODUCTION CAPACITY IMPROVEMENT Reggiana Riduttori San Polo d’Enza - Automated warehouse Walvoil Corte Tegge - Robotic machining center of directional valve bodies’ 10
Slide 12: 3Q-3Q2023YTD NFP – Acquisitions – Diversification Enhancement
3Q-3Q2023YTD NFP – ACQUISITIONS – DIVERSIFICATION ENHANCEMENT ▪ 3 acquisitions to support Group strategic growth path ▪ Mouldtech, key piece to enhance cast iron supply chain ‒ A fundamental raw material for Group “valves” sector ‒ An increase “production&facility” plan already in place to gradually
Slide 13: 3Q2023YTD Group Sustainability Path
3Q2023YTD GROUP SUSTAINABILITY PATH 12
Slide 14: 3Q2023YTD Three Priorities for Three Pillars
3Q2023YTD THREE PRIORITIES FOR THREE PILLARS SUPPORTED GRI 2023-2025 KEY TARGETS and SDG ▪ Definition of Group “Carbon neutrality” strategy 2023 E ▪ Reduction of Group “Carbon intensity” 2025 ▪ Increase of renewed electricity consumption 2025 305-1 and 2 302-1 ▪ Injury rate improvement 2024 S ▪ ESG
Slide 15: 3Q2023YTD «E» – 2023-32 Decarbonisation Strategy
3Q2023YTD «E» – 2023-32 DECARBONISATION STRATEGY (1) SUPPORTED GRI 2023-2025 KEY TARGETS and SDG ▪ Definition of Group “Carbon neutrality” strategy 2023 E ▪ Reduction of Group “Carbon intensity” 2025 ▪ Increase of renewed electricity consumption 2025 305-1 and 2 302-1 ▪ Targets – Achievement of Grou
Slide 16: «E» – 2023-32 Decarbonisation Strategy – Improvements
3Q2023YTD «E» – 2023-32 DECARBONISATION STRATEGY – IMPROVEMENTS ▪ Consistently with Group commitment to improve ESG approach, “2023-32 Decarbonisation Strategy” factors some important improvements compared to “2023-25 ESG Journey” ▪ Higher number of Group companies included in the calculation sample
Slide 17: «E» – 2023-32 Decarbonisation Strategy – 2025 Target
3Q2023YTD «E» – 2023-32 DECARBONISATION STRATEGY – 2025 TARGET ▪ Achievement of Group 2025 Emission reduction target – “2023-32 Decarbonisation Strategy” will allow Group to reach the 30% emission reduction 2025 REDUCTION TARGET(1) (tCO2e) 100,000 100,000 90,000 90,000 80,000 80,000 90.286 90.286 78
Slide 18: «E» – 2023-32 Decarbonisation Strategy – 2032 Target
3Q2023YTD «E» – 2023-32 DECARBONISATION STRATEGY – 2032 TARGET ▪ Enhancement of “2030 Emission reduction target” (1) road map – “2023-32 Decarbonisation Strategy” will allow Group to reach a 45% emission reduction in 2032 2032 REDUCTION TARGET (2) (tCO2e) 100,000 90,000 80,000 90.286 70,000 78.922 -
Slide 19: «G» – Building ESG Foundation
3Q2023YTD «G» – BUILDING ESG FOUNDATION SUPPORTED GRI 2023-2025 KEY TARGETS and SDG ▪ Establishment of Board ESG Committee 2023 G ▪ Succession plan formalisation 2023 207-1, 2 and 3 ▪ Tax compliance consolidation 2024 ▪ Establishment of Board ESG Committee (1) – Strong ESG competence of independent
Slide 20: «G» – Succession Plan Formalisation
3Q2023YTD «G» – SUCCESSION PLAN FORMALISATION ▪ Interpump Succession Plan − Protect Group organizational stability and continuity in case of temporary or lasting inability of “key managerial figures” ▪ Two interconnected processes IDENTIFICATION − Identification • Procedures to identify Key Figures
Slide 21: 2023-2025 ESG Plan – Snapshot and Updating
3Q2023YTD 2023-2025 ESG PLAN – SNAPSHOT AND UPDATING ANALYSIS AND MEASUREMENT BUILDING GROUP LEADING TO ESG FOUNDATIONS 2030 AND 2050 DECARBONISATION TARGETS 2022 2023 2024 2025 2027 • E.1 - Carbon neutrality strategy • E.2 - Carbon intensity reduction • S.2 - ISO 45001 extension • E.4 - Circular ec
Slide 22: Outlook
2023 OUTLOOK 21
Slide 23: Almost 30 Years of Excellence and Resilience
2023 ALMOST 30 YEARS OF EXCELLENCE AND RESILIENCE ▪ Most recent trends (1) confirmed summer evolution ‒ Even if below € 1 billion, backlog is 3x Pre COVID level, assuring a consistent very high visibility ‒ Ongoing normalisation in some Hydraulic market applications and ongoing Water Jetting strengt
Slide 24: Almost 30 Years of Excellence and Resilience
2023 ALMOST 30 YEARS OF EXCELLENCE AND RESILIENCE ▪ Since IPO in 1996 Group built a track record of excellence and resilience ▪ Sales: 1996-2022 C.A.G.R of more than 9% with only 4 years of decrease driven by Group strategic activities review or extraordinary external events ▪ EBITDA: 1996-2022 C.A.
Slide 25: Almost 30 Years of Excellence and Resilience
2023 ALMOST 30 YEARS OF EXCELLENCE AND RESILIENCE GROUP 2019-2022 ▪ Excellence and resilience are driven by SALES&EBITDA and FCF/EBITDA EVOLUTION (1) ‒ Strategic approach 2 (Figures indexed to 2018 data) • Complementary nature of Group two divisions 2022-21 sales: +29.5% on total and +13.6% organica
Slide 26: Almost 30 Years of Excellence and Resilience
2023 ALMOST 30 YEARS OF EXCELLENCE AND RESILIENCE ▪ Excellence and resilience are the results of a never ending process which allowed Group to successfully face external shocks ▪ 2008-09 financial and 2020-21 pandemic crisis are recalled as most difficult periods in Group recent history ▪ 2021-21 be
Slide 27: Almost 30 Years of Excellence and Resilience
2023 ALMOST 30 YEARS OF EXCELLENCE AND RESILIENCE ▪ Interpump today compared to Interpump in 2007 − Better “division” breakdown with an improved fit to the different economic cycles − Better “geographic” breakdown, especially in Europe, with “Europe-ex-Italy” from 29% to 69% on total − Better “appli
Slide 28: Almost 30 Years of Excellence and Resilience
2023 ALMOST 30 YEARS OF EXCELLENCE AND RESILIENCE − Wiser approach to growth with an unchanged capability to exploit consistent cash generation in worsening environment • Quality of customer, tactical supply chain approach and capability to fast adapt inventories GROUP 2007-2011 FCF/EBITDA and NFP/E
Slide 29: Annex
ANNEX • DISCLAIMER • 3Q-3Q2023YTD ADDITIONAL DATA • 2023-2025 ESG JOURNEY – 2023 ACTIONS • 2022 SALES DETAILS 28
Slide 30: Annex Disclaimer
ANNEX DISCLAIMER 29
Slide 31: Annex Disclaimer – Performance Indicators
ANNEX DISCLAIMER − PERFORMANCE INDICATORS The Group uses several alternative measures that are not identified as accounting parameters in the framework of IFRS standards, to allow better evaluation of the trend of economic operations and the Group's financial position. Such indicators are also tools
Slide 32: Annex Disclaimer – Forward Looking Statements
ANNEX DISCLAIMER – FORWARD LOOKING STATEMENTS This document has been prepared by Interpump Group S.p.A for aforesaid forward-looking statements. This document does not use during meetings with investors and financial analysts and is constitute an offer to sell or a solicitation to buy or subscribe t
Slide 33: Annex 3Q2023 Additional Details
ANNEX 3Q2023 ADDITIONAL DETAILS 32
Slide 34: Quarterly Organic Sales Evolution
ANNEX 3Q2023 ADDITIONAL DETAILS – QUARTERLY ORGANIC SALES EVOLUTION GROUP 2020-2023 ORGANIC GROWTH 50% EVOLUTION by QUARTER 40% 39.4% 2020: -12.6% - 2021: +20.1% 2022: +13.7% - 2023YTD: +10.4% 30% 20% 18.7% 12.5% 17.9% 15.7% 12.6% 14.2% 14% 9.1% 11.6% 10% 4.0% 0% -1.7% -10% -11.2% -20% -16.2% -25.2%
Slide 35: Annex 2023-2025 ESG Journey – 2023 Actions
ANNEX 2023-2025 ESG JOURNEY – 2023 ACTIONS 34
Slide 36: 2023 Actions – New Ethics Code
ANNEX 2023-2025 ESG JOURNEY – 2023 ACTIONS – NEW ETHICS CODE ▪ New Code of Ethics − To reflect Group Sustainability commitments undertaken with 2023-25 ESG Journey ▪ Sustainability commitments − E: sustainable growth and reduction of environmental impacts − S: human & labor rights protection and ski
Slide 37: 2023 Actions – New Ethics Code
ANNEX 2023-2025 ESG JOURNEY – 2023 ACTIONS – NEW ETHICS CODE PREVIOUS CODE OF ETHICS UPDATED CODE OF ETHICS Stakeholders, i.e. those categories of individuals, groups or institutions whose contribution is required to achieve the mission of Interpump and who have significant interests gravitating aro
Slide 38: 2023 Actions – ESG Committee
ANNEX 2023-2025 ESG JOURNEY – 2023 ACTIONS – ESG COMMITTEE ▪ April 2023, new Group Board ‒ Sustainability Committee appointment, with Group CEO as a member ‒ Separation between Chairman and CEO role INTERPUMP GROUP BOARD Chairperson: F. Montipò Deputy Chairperson: G. Tamburi Chief Executive Officer:
Slide 39: Annex 2022 Sales Details
2022 SALES DETAILS (“at ANNEX
Slide 40: 2022 Sales Details – Group Sales Breakdown
ANNEX 2022 SALES DETAILS – GROUP SALES BREAKDOWN (1) 1% 11% 9% 16% 6% 8% GROUP 12% 52% 2022 sales: € 2.078m 6% 4% 8% 7% 1% 29% 1% 6% 1% 18% 1% 1% 3% 1% 1% EARTH MOVING MACHINE CONSTRUCTION AGRICOLTURE LIFT ADAPTORS INDUSTRIAL VEHICLES COSMETIC EUROPE AUTOMOTIVE AEROSPACE&DEFENCE OFFSHORE SHIPYARD-MA
Slide 41: 2022 Sales Details – Hydraulic Sales Breakdown
ANNEX 2022 SALES DETAILS – HYDRAULIC SALES BREAKDOWN (1) 11% 12% 18% 8% 7% HYDRAULIC 55% 2022 sales: € 1.542m 8% 1% 1% 1% 16% 3% 1% 27% 10% 22% EARTH MOVING MACHINE CONSTRUCTION AGRICOLTURE LIFT ADAPTORS INDUSTRIAL VEHICLES COSMETIC EUROPE AUTOMOTIVE AEROSPACE&DEFENCE OFFSHORE SHIPYARD-MARINE NORTH
Slide 42: 2022 Sales Details – Water Jetting Sales Breakdown
ANNEX 2022 SALES DETAILS – WATER JETTING SALES BREAKDOWN (1) 12% 1% 11% 7% 4% 9% 3% 44% 2% WATER JETTING 2022 sales: € 541m 3% 22% 2% 20% 13% 36% 2% 5% 3% 1% EARTH MOVING MACHINE CONSTRUCTION AGRICOLTURE LIFT ADAPTORS INDUSTRIAL VEHICLES COSMETIC EUROPE AUTOMOTIVE AEROSPACE&DEFENCE OFFSHORE SHIPYARD
Slide 43: Mauro Barani
The Manager in charge of preparing the company’s financial reports declares - pursuant to paragraph 2 of Article 154-bis of the Consolidated Law on Finance - that the accounting information contained in this presentation corresponds to the document results, books and accounting records. S.Ilario d’E