Sfs Group Ag · SIX:SFSN
Sfs — Investor Day (September 2022)
59 slides from Sfs's investor day presentation, Sep 15, 2022
Slide 1: Value Engineering Specialist – Investor Day 2022
Value Engineering Specialist Investor Day 2022 Heerbrugg | Switzerland, September 15, 2022
Slide 2: Today's speakers
Today’s speakers Welcome to the presentation and video webcast Jens Breu Volker George Poh Alfred Arthur Blank Chief Executive Dostmann Member of the Schneider Member of the Officer Chief Financial Group Executive Member of the Group Executive Officer Board – Division Group Executive Board – Divisio
Slide 3: Agenda Investor Day II, 2022
Agenda Investor Day II, 2022 1. Optional plant tour 08.00–08.45 am 2. Presentation and Q&A 09.00–11.15 am 3. Optional plant tour 11.15–12.00 am 4. Lunch 11.15–01.00 pm Investor Day 2022 | September 15, 2022 3
Slide 4: Presentation
Presentation 1. Positioning of SFS Jens Breu 2. Highlights ESG Jens Breu 3. Key financial messages 1H 22 Volker Dostmann 4. Electronics division George Poh 5. Construction division Arthur Blank 6. Medical division Jens Breu 7. Automotive division Alfred Schneider 8. D&L International update Jens Bre
Slide 5: Positioning of SFS
Positioning of SFS Investor Day 2022 | September 15, 2022 5
Slide 6: We are by your side – 24/7
Mission critical products for selected niche applications We are by your side – 24/7 Investor Day 2022 | September 15, 2022 6
Slide 7: Our focused business activities
Our focused business activities Synergies in tooling based technologies Development and industrialization of tooling based, Development and distribution of application specific tools Development and trade of tools, fasteners and work customized precision components and assemblies and fasteners equip
Slide 8: SFS value proposition over all segments
SFS value proposition over all segments Inventing success together Investor Day 2022 | September 15, 2022 8
Slide 9: Our focused business activities – Sustainable growth through the cycle
Our focused business activities Sustainable growth through the cycle Innovation Megatrends Digital revolution Leverage of global platforms Resources • Local-for-local business constraints development • Increase share of wallet Economic Operational excellence • Reduction of supply chain globalization
Slide 10: Global sales & manufacturing platform
140 Global sales & manufacturing platform locations in 35 Customer proximity supported by local presence countries North America Europe Asia, others 40 Locations 85 Locations 15 Locations (7 Production operations) (20 Production operations) (5 Production operations) Investor Day 2022 | September 15,
Slide 11: Highlights ESG
Highlights ESG Investor Day 2022 | September 15, 2022 11
Slide 12: Our key ESG initiatives
Our key ESG initiatives Creating value for all our stakeholders Reduce CO2 Environmental emissions by 90% until 2030 Renewable Energy Lean & Green Program Mobility and Transport Sustainable Value Chain Purchase and own production Efficient production, waste reduction Sales, logistics, employees Supp
Slide 13: Energy crisis & CO2 emission reduction
Energy crisis & CO2 emission reduction Solutions for both issues go hand-in-hand Continued efforts to reduce Build-up of own energy Local for local approach allows consumption and save energy production for regional diversification of • Reduce dependency • Reduce dependency supply chains and operati
Slide 14: Wind energy – the future of energy in winter
Wind energy – the future of energy in winter A lighthouse project as supplement to photovoltaics • As electricity shortage is emerging in the winter half-year, SFS strives to use available wind energy for a sustainable energy supply • To this end, SFS provides industrial land to realize the first wi
Slide 15: Hoffmann Group Foundation – Tools create value
Hoffmann Group Foundation “Tools create value” • Social commitment as part of Hoffmann’s corporate culture • Projects that support the development of disadvantaged and traumatized children and young people • Orange Houses: therapy and creative centers • Orange Projects: creative and therapy workshop
Slide 16: Governance – Sustainability reporting structure
Governance – Sustainability reporting structure Start with CDP for reporting year 2022 • Reporting period 2022 • GRI Report (Standard 2021, “in accordance with”) • CDP • EcoVadis • UN Global Compact • Reporting period 2023 • German Supply Chain Act • TCFD • Combined release of annual report and sust
Slide 17: Key financial messages 1H 22
Key financial messages 1H 22 Investor Day 2022 | September 15, 2022 17
Slide 18: Development EPS 2019 – 1H 22
Development EPS 2019 – 1H 22 Hoffmann accretive to EPS as of 2022 • CAGR EPS 2019–2021 of 9.1% EPS in CHF 7 6.51 • 1H 22 EPS reported CHF 3.42 per share 6 • 1H 22 EPS considered to be very strong: 5.47 • Total shares increased by 1.4 million 5 4.9 • 1H 22 EBIT 13.3%, yoy –380bp • Hoffmann contributi
Slide 19: Adjust Guidance FY2022 to mid-term guidance
Adjust Guidance FY2022 to mid-term guidance SFS and Hoffmann (8 months of consolidation) 2021A 2022G: 2022G: 2022G: (CHF) W/o Hoffmann Updated May 12 Updated Aug 26 Gross sales SFS stand- 1,893 m Growth 3–6% Growth 3–6% Growth 3–6% alone (in local currencies) Sales impact 8 months consolidation Hoff
Slide 20: Swiss franc exposure – OPEX in CHF reduced to 34%
Swiss franc exposure Share of OPEX in Swiss francs further reduced to 34% • Export activities suffer from appreciation 45% 44.3% • Drivers for strategically targeted reduction 39.8% 40.2% 39.3% • M&A outside CHF denomination 40% 37.4% 38.4% • Improved productivity in Switzerland • Relocate processes
Slide 21: Swiss franc exposure – limited translation impact
Swiss franc exposure Appreciation of CHF with limited translation impact • P&L translation in foreign currency • Simulation with an EUR at 0.975 or USD at 0.900 • Combined impact on Group EBIT margin expected to be around –10 to +10 bps compared to average 1H 22 • Hence, FX translation effect has li
Slide 22: Electronics division
Electronics division George Poh, Head of Electronics division Investor Day 2022 | September 15, 2022 22
Slide 23: Positioning and market trends
Positioning and market trends Positioned to serve above average growing segments Position within electronics market Key trends in industry • Supplying the electronics industry based on 7 core technologies and with 8 core products Mobile Lifestyle • Focus on end market segments device electronics HDD
Slide 24: Project Starlight 2 – Unisteel Nantong phase 2 expansion
Project Starlight 2 – Unisteel Nantong phase 2 expansion Completion in June 2023 • Phase 1 space fully utilized earlier than expected (occupation in 2019) • Growth of Electronics products with higher space utilization footprint • Platform for other divisions in China: • Relocation Riveting from Nans
Slide 25: Project Starlight 2 – Unisteel Nantong phase 3 expansion
Project Starlight 2 – Unisteel Nantong phase 3 expansion Completion by end 2023 • Phase 3/4 located 1 km away from main site • Limited land nearby existing site • Phase 3 – mainly warehouse plus production • Phase 4 – land reserved for future expansion Land area Built-up area Phase 3 28,233 m2 57,47
Slide 26: AR/VR: Market trend and applications
AR/VR: Market trend and applications Attractive opportunities for Unisteel 120 Global XXR (CR/AR) Headset Forecast by Device Type, 2015 to 2025 • Analysts forecast exponential growth, AR stand-alone VR Tethered expected to reach >100 m units by 2025 • High Unisteel value content per device SHIPMENTS
Slide 27: Multilevel customer penetration
Multilevel customer penetration Growth across product ecosystems and technologies • Increase value content of supplies for end customer products • Value engineering with special coating on existing screws to improve performance • Changing material from carbon steel to stainless steel • Cross-selling
Slide 28: Technology innovation – 3D transfer stamping
Technology innovation – 3D transfer stamping Complex vertical cold forming One step forming (1 clover+2 post) • Value engineering to customers • Transform from conventional full CNC machining to 3D transfer stamping/cold forming • Advantages: • Reduced material wastage, lower cost and positive impac
Slide 29: Electronics priorities
Electronics priorities Key initiatives to grow top and bottom line Customer Nantong HDD Employees ecosystem platform replacement penetration Support other SFS Human capital develop- Increase share of wallet Leverage Malaysia plant divisions to leverage ment in lifestyle electronics and for medical b
Slide 30: Construction division
Construction division Arthur Blank, Head of Construction division Investor Day 2022 | September 15, 2022 30
Slide 31: Construction division in a nutshell
Construction division in a nutshell Clear orientation in a fragmented market Position within construction market Peculiarities of business • “The building envelope specialist” • No dependence on individual large customers • Fastening technology in the building envelope, • Regional or national rules,
Slide 32: Key figures Construction division
Key figures Construction division Close to the market for best understanding 40 2000 15 10 market skilled competence production organisations employees centers plants Investor Day 2022 | September 15, 2022 32
Slide 33: Sustainable growth in North America
Sustainable growth in North America Expansion of TFC branch network • Acquisition of Triangle Fastener Corporation (TFC) in 2019 allowed to add direct access to local installers and contractors (about 6,000 active end customers) • TFC with network of 25 sales branches, mainly along the US East Coast
Slide 34: Value generation with superior technologies
Value generation with superior technologies Increase value with systems approach • Car factory Magna in Hungary • Fastening of single-ply membrane and the insulation boards on the 32,000 m² flat roof with more than 100,000 isoweld® stress plates and several thousand fully-metallic fixing points • Ad
Slide 35: Value generation with high competence and service
Value generation with high competence and service Increase value take per project • Museum of Modern Art in Orange County CA • Nvelope as a substructure for the curved rain screen façade • SFS USA did the consulting, cut-to-length of the profiles and just-in-time delivery to the construction site •
Slide 36: Targeted growth initiatives
Targeted growth initiatives Applications, customer groups or regions Application competence Customer service Strengthening of application Maximum customer service competence and product through the integration of the range with a market leader painting specialist for façade by acquisition of HECO fa
Slide 37: Construction division priorities
Construction division priorities Key initiatives to grow top and bottom line Clear focus Employees Supply chain Innovation Clear positioning as Decentralized Supply chain with focus Innovations of pro- “Building Envelope organization with entre- on high product ducts, systems, services, Specialist”
Slide 38: Medical division
Medical division Jens Breu, CEO SFS Group Investor Day 2022 | September 15, 2022 38
Slide 39: Positioning and market trends
Positioning and market trends Focus on high-growth market segments Position within medical market Key market trends • End-to-end contract manufacturer of components and complete medical devices for OEM customers Increased Robotic Digitization Customer life surgery/ & Patient proximity • Target end m
Slide 40: Target end markets and applications
Target end markets and applications Ca. 85% of sales in target end markets End Market Applications Pedical Endoscopic Breast screws Cardiology catheter Meniscal repair ultrasound needle biopsy Investor Day 2022 | September 15, 2022 40
Slide 41: Positioning for profitable growth
Positioning for profitable growth Strategic initiatives Increase share of wallet with existing customers Pursue new customers in target Global platform markets Talent management and Vertical integration for end to end development solutions Efficient processes, state of the art Innovation and entrepr
Slide 42: Global sales & manufacturing platform in development
Global sales & manufacturing platform in development Local presences and capabilities to serve global OEMs * GTC = Genesis Technology Center Increase footprint from 80k to 120k sqft, plus further land reserves Franklin, USA * * * * Increase footprint from 55k to 110k sqft Heredia, Costa Rica * Cold
Slide 43: Medical – Key initiatives to grow top and bottom line
Medical Key initiatives to grow top and bottom line Globalization Employees Organization Branding Increase engagement Continue with Develop global SFS Use Tegra Medical and participation in preventive measures to medical organization to brand for global activities European and Asian protect employee
Slide 44: Automotive division
Automotive division Alfred Schneider, Head of Automotive division Investor Day 2022 | September 15, 2022 44
Slide 45: Positioning and market trends
Positioning and market trends Positioned to serve above average growing segments Position within automotive market Key trends in industry • Supplying the automotive industry and its supply chain with precision components Safety Efficiency Autonomous • Focus on areas of driving • Active and passive s
Slide 46: Participation in the braking circuit
Participation in the braking circuit Fleet penetration continuing Market penetration 2020 and ’22 ABS/ ESC Electric Parking Brake (EPB) Integrated Brake System Source: IHS, July 2020 Investor Day 2022 | September 15, 2022 46
Slide 47: Penetrating the braking circuit
Penetrating the braking circuit Build up local supply chains and operations over 20yrs North Europe Asia America Power Power Power ABS Parts EPB Actuators ABS Parts EPB Actuators Brake Actuators ABS Parts EPB Actuators Brake Actuators Brake Actuators Investor Day 2022 | September 15, 2022 47
Slide 48: Finished new Hall 6 in Heerbrugg
Finished new Hall 6 in Heerbrugg – high dynamic 80% of space will be occupied within the next 3 years • Building finished on time and within budget • First machines and equipment installed • Focus on new generation BSD programs • Recently awarded programs from all major Tier 1s will occupy 80% of th
Slide 49: Camera/sensor housings for autonomous driving
Camera/sensor housings for autonomous driving Dynamic growth Volume development (booked orders) 150 Million pcs Membrane pots for ultrasonic parking sensor 120 • CAGR 2019–2024: 20% • Localization: Flawil (CH) 90 60 Camera housings 30 • CAGR 2019–2024: 78% 0 • Localization: Flawil (CH), Nantong (CN)
Slide 50: Automotive division priorities
Automotive division priorities Key initiatives to grow top and bottom line Capacity Leverage on Leader in BSD Global Employees management innovations technology platform Match production Maintain focus Continue with Foster global Leverage global capacity and on identified preventive meas- leading ma
Slide 51: D&L International update
D&L International update Jens Breu, CEO SFS Group Investor Day 2022 | September 15, 2022 51
Slide 52: Increase share of wallet through product line additions
Increase share of wallet through product line additions Industrial ecosystem 20m around the workcenter DIGITALIZATION IN PERSONAL CONSULTING MANUFACTURING SERVICES AND E-BUSINESS AUTOMATION MACHINING AND PERSONAL PROTECTIVE CLAMPING TECHNOLOGY EQUIPMENT HAND AND WORKSTATIONS AND STORAGE AND MEASURIN
Slide 53: Key needs of customers in line with SFS core strengths
Key needs of customers in line with SFS core strengths Providing the basis for cross-selling initiatives Application and industry expertise Security of supply Personal contact and qualified advice on 100% reliability required in terms of products and process are decisive completeness and accuracy de
Slide 54: Update D&L international
Update D&L international Consistent progress on key projects • Ramp-up of LogisticCity continuing as planned, completion expected by end of year • No further one-time costs related to ramp-up in 2022 expected • Evaluation of most attractive growth and supply chain projects in the areas of cross- sel
Slide 55: Q&A
Q&A Investor Day 2022 | September 15, 2022 55
Slide 56: Thank you for your attention
Thank you for your attention Investor Day 2022 | September 15, 2022 56
Slide 57: Safety rules for plant tour
Safety rules for plant tour Investor Day 2022 | September 15, 2022 57
Slide 58: Investor Day 2022 | September 15, 2022
Investor Day 2022 | September 15, 2022 58
Slide 59: Disclaimer
Disclaimer This presentation includes forward looking statements. These statements reflect the SFS Group's current assessment of market conditions and future events. The statements are therefore subject to risks, uncertainties and assumptions. Unforeseen events may lead to deviations of the actual r