Slide 1: Rapala VMC Corporation Highlights H1 2016
RAPALA VMC CORPORATION HIGHLIGHTS H1 2016 July 22, 2016
Slide 2: Rapala 80th Anniversary Campaign
RAPALA 80th ANNIVERSARY CAMPAIGN • CAMPAIGNS ON ALL MAJOR MARKETS • EXTENSIVE VISIBILITY IN FINLAND H1 2016 2
Slide 3: Rapala Shadow Rap Shad
RAPALA SHADOW RAP SHAD • INTRODUCED AT THE BASS MASTER CLASSIC IN MARCH 2016 • FOLLOWS THE GREAT SUCCESS OF RAPALA SHADOW RAP INTRODUCED IN 2015 • INNOVATIVE JERKBAIT ACTION THAT MIMICS DYING BAITFISH • MORE THAN A MILLION PIECES OF SHADOW RAP SERIES LURES SOLD SINCE 2015 H1 2016 3
Slide 4: EFTTEX 2016 Best New Product Competition
EFTTEX 2016 BEST NEW PRODUCT COMPETITION • RAPALA URBAN CLASSIC SLING BAG WINS BEST NEW BAG CATEGORY AT EFTTEX 2016 • RUNNER UP RECOGNITIONS FOR RAPALA TOOLS & WADERS AND STORM SOFT BAIT RIG H1 2016 4
Slide 5: World Predator Classic 2016 Tournament
WORLD PREDATOR CLASSIC 2016 TOURNAMENT • TEAM RAPALA FINLAND WINS THE WORLD PREDATOR CLASSIC 2016 TOURNAMENT IN NETHERLANDS • TEAM RAPALA FINLAND – TEAM RAPALA FRANCE WIN THE WPC TEAM EVENT THIRD TIME IN ROW H1 2016 5
Slide 6: Rapala VMC Corporation Half Year H1 2016
RAPALA VMC CORPORATION HALF YEAR H1 2016 July 22, 2016
Slide 7: Summary of H1 2016
Summary of H1 2016 • NET SALES 143.1 MEUR (154.0) (-7%) • With comparable exchange rates sales down 5% • COMPARABLE OPERATING PROFIT 15.6 MEUR (20.6) (-24%) • Decrease primarily driven by the lower sales, especially on higher margin Group branded products • REPORTED OPERATING PROFIT 14.2 MEUR (17.4)
Slide 8: Net Sales
Net Sales • H1 NET SALES 143.1 MEUR (154.0) (-7%) • Changes in FX rates explain approximately -3.3 MEUR. With comparable FX sales -5% • Slowdown in major markets, especially in the US and France • Market situation in Russia continue to be difficult but positive development in Scandinavia and Chile •
Slide 9: H1 Net Sales – Geographical Areas
H1 Net Sales – Geographical Areas -3% 33,3 34,2 ‐9% -10% 46,4 -7% 48,0 51,4 51,6 ‐6% ‐6% +2% -9% 15,3 16,8 -5% ‐10% ‐10% • NORTH AMERICA • NORDICS • REST OF EUROPE • REST OF THE WORLD • Comparable net sales -11% • Comparable net sales -2% • Comparable net sales -3% • Comparable net sales -1% • Slow
Slide 10: Net Sales – Product Segments
Net Sales – Product Segments • GROUP PRODUCTS H1 95.0 MEUR (103.5) (-8%) • Comparable net sales -7% • Lure, hook and line sales down mainly in the US, Russian challenges continue • Q2: 47.8 MEUR (52.7) (-9%, comparable -8%) • THIRD PARTY PRODUCTS H1 48.1 MEUR (50.5) (-5%) • Comparable net sales -0%
Slide 11: Comparable Operating Profit
Comparable operating Profit • COMPARABLE OPERATING PROFIT 15.6 MEUR (20.6) (-24%) • Burdened by lower sales, especially on higher margin Group branded products • Further hurt by lower result of the UK joint venture and aggressive sales campaigns reducing the margins • Group’s fixed costs remained st
Slide 12: Comparable Operating Profit – Product Segments
Comparable operating Profit – Product segments* • GROUP PRODUCTS 12.0 MEUR (16.9) (-29%) • Burdened by lower sales reducing profitability both at distribution and manufacturing level • Lower margins as a result of sales campaigns • THIRD PARTY PRODUCTS 3.6 MEUR (3.7) (-3%) • Burdened by aggressive s
Slide 13: Net Profit and EPS
Net Profit and EPS • FINANCIAL (NET) EXPENSES 2.8 MEUR (4.1) • Impact of FX expenses of 1.1 MEUR (2.7) • Net interest and other financial expenses 1.7 MEUR (1.5) • NET PROFIT 8.2 MEUR (8.3) • SHARE OF NON-CONTROLLING INTEREST 0.8 MEUR (1.1) • EPS 0.19 EUR (0.19) 16 0,35 14 12 0,26 10 8 0,17 Net prof
Slide 14: Cash Flow and Working Capital
Cash Flow and Working Capital • CASH FLOW FROM OPERATIONS 6.2 MEUR (10.7) • Change in working capital -7.3 MEUR (-6.7) • INVENTORIES 118.1 MEUR (121.8) • Decreased 3.7 MEUR from last year • Currency impact decreased inventories by 3.0 MEUR • Slowdown in sales prevented the Group from achieving plann
Slide 15: Financial Position
Financial Position • LIQUIDITY POSITION OF THE GROUP • Undrawn committed long-term credit facilities amounted to 79.9 MEUR • GEARING AND NET INTEREST-BEARING DEBT • Gearing at 82.9% (75,9%) • Equity-to-assets ratio slightly above last year level at 43,6% • Following, increased net interest-bearing d
Slide 16: Cornerstones of the Profitable Growth Strategy
Cornerstones of the Profitable Growth Strategy BRANDS RAPALA CULTURE Portfolio of most recognized and Local entrepreneurial spirit and respected brands in the fishing profit responsibility together tackle industry. with a low hierarchy, straightforward business culture Rapala novelties introduced to
Slide 17: Short-term Outlook
Short-term Outlook • Following the decline in sales during the first half of the year, the outlook for the whole year is now more depressed. • In North American and Western European markets the slowdown in sales is expected to be temporary. Especially in Europe but also in USA there are quite some p
Slide 18: Tight Lines
TIGHT LINES
Slide 19: Appendices
APPENDICES
Slide 20: H1 & FY Key figures
H1 & FY Key figures MEUR H1/2016 H1/2015 FY/2015 Net sales 143.1 154.0 278.2 Operating profit 14.2 17.4 21.0 Operating profit, % of net sales 9.9% 11.3% 7.6% Comparable operating profit 15.6 20.6 25.3 Comparable operating profit, % of net sales 10.9% 13.4% 9.1% Net profit for the period 8.2 8.3 8.1
Slide 21: H1 Net Sales – Geographical Areas
H1 Net Sales – Geographical Areas North America Nordic 70 70 60 60 50 50 40 40 30 30 20 20 10 10 0 0 H1 H2 H1 H2 H1 H2 H1 H2 H1 H1 H2 H1 H2 H1 H2 H1 H2 H1 2012 2013 2014 2015 2016 2012 2013 2014 2015 2016 Rest of Europe Rest of the World 70 70 60 60 50 50 40 40 30 30 20 20 10 10 0 0 H1 H2 H1 H2 H1 H
Slide 22: EPS
EPS EPS, EUR 0,35 0,30 0,25 0,20 0,15 EUR 0,10 0,05 0,00 ‐0,05 ‐0,10 H1 H2 H1 H2 H1 H2 H1 H2 H1 2012 2013 2014 2015 2016 0,40 90 % 0,30 85 % EUR 0,20 80 % 0,10 75 % ‐ 70 % 2012 2013 2014 2015 2016 EPS, EUR DPS, EUR Payout, % H1 2016 22
Slide 23: Profit and loss account
Profit and loss account MEUR H1 2016 H1 2015 FY/2015 Net sales 143.1 154.0 278.2 Other operating income 0.2 0.3 1.0 Materials and services 63.6 70.6 130.9 Personnel expenses 35.1 35.3 68.4 Other costs and expenses 27.0 27.8 52.3 Share of results in associates and joint ventures 0.0 0.3 0.4 EBITDA 17
Slide 24: Balance sheet
Balance sheet MEUR H1 2016 H1 2015 FY/2015 ASSETS Non-current assets Intangible assets 76.5 78.1 78.2 Property, plant and equipment 35.7 32.0 33.9 Non-current assets Interest-bearing 0.9 5.1 2.8 Non-interest-bearing 11.2 12.0 11.8 124.4 127.2 126.7 Current assets Inventories 118.1 121.8 116.2 Curren
Slide 25: Shares and Shareholders
Shares and Shareholders SHARE RELATED DATA (6/2016) Share price index performance from Jan 2014 – Jun 2016 • Market capitalization 171.2 MEUR • 12-month high/low 5.85/3.90 EUR 155 Indexed values 145 • All-time high/low 8.40/2.50 EUR 135 125 115 105 95 MAJOR SHAREHOLDERS (6/2016) 85 75 • VMC Holdings
Slide 26: Financial Trends
Financial Trends 45 35 20% 160 800% Sales and scope Profitability 275 Balance sheet position 40 18% 30 140 700% 250 16% 35 225 120 600% 25 14% 200 30 Number of countries 100 500% 175 12% Gearing % 20 % of sales 25 MEUR MEUR MEUR 150 10% 80 400% 20 125 15 8% 60 300% 100 15 6% 10 75 40 200% 10 4% 50 5