Bilfinger Se · XETR:GBF
Bilfinger — Non-Deal Roadshow (August 2019)
35 slides from Bilfinger's roadshow presentation, August 2019
Slide 1: Bilfinger SE Company Presentation August 2019
Bilfinger SE Bilfinger SE Company Presentation August 2019
Slide 2: Overview
Overview
Slide 3: Bilfinger at a glance
Bilfinger at a glance Leading international industrial services provider Efficiency enhancement of assets, ensuring a high level of availability and reducing maintenance costs €4.15bn revenue Clear 2-4-6 strategy with two service lines, four regions and six focus industries thereof recurring b
Slide 4: Strategy affirmed, enhanced setup: 2 Service Lines, 4 Regions, 6 Industries
Strategy affirmed, enhanced setup 2 Service Lines, 4 Regions, 6 Industries Our ambition We engineer and deliver process plant performance 2 Service Lines 4 Regions 6 Industries • Technologies • Continental Europe • Chemicals & • Pharma & Where to play • Engineering & Maintenance • Northwest Europe P
Slide 5: 2 Service Lines: Enhanced setup for build up and build out phase
2 Service Lines Enhanced setup for build up and build out phase Technologies Engineering & Maintenance FY 2018: Revenues €503m, EBITA adj. €-26m FY 2018: Revenues €3,477m, EBITA adj. €134m Market Market High growth potential for technological products esp. in Increasing demand in Engineering Mainten
Slide 6: Technologies: ambition to grow higher-margin business
2 Service Lines Technologies: ambition to grow higher-margin business Tech- Scrubber Pharma & Nuclear nology biopharma Services expertise Descrip- • High demand driven by legis- • Ageing society and global rise of • Worldwide build programs tion lation on emissions and CO2 middle class drives new pr
Slide 7: Proven Nuclear Expertise: Hinkley Point C
Proven Nuclear Expertise Hinkley Point C: Positioned as strategic supplier 250 Accumulated orders in € million 30.06.2019 31.12.2019e Bilfinger SE | Company Presentation | August 2019 page 7
Slide 8: Marine environmental solutions: Scrubber technology transfer
Marine environmental solutions Scrubber: Successful technology transfer 200 Accumulated orders in € million 0 Q2/18 Q3/18 Q4/18 Q1/19 Q2/19 Q3/19e Q4/19e Bilfinger SE | Company Presentation | August 2019 page 8
Slide 9: Engineering & Maintenance: combined and full life cycle services
2 Service Lines Engineering & Maintenance: combined and full life cycle services driving value Tech- Combined Bilfinger Corrosion nology strength Turnaround under Concept insulation Descrip- • €36m deodorization plant for • High risk events for customers – • Major root cause of process tion Fluxys s
Slide 10: Strategic position: frontrunner in the IoT of process industries
Strategic position Bilfinger is well positioned to be the frontrunner in the IoT of process industries Process Industry Bilfinger IT Industry Digitalization hurdles Building digital bridges Applicability deficits • Requirement to • Deep knowledge of customer needs and • No access to plant improve pe
Slide 11: Compliance Management System: A competitive advantage
Compliance Management System A competitive advantage Certified by compliance monitor in December of 2018 Deferred Prosecution Agreement (DPA) concluded Prevent Compliance system is industry leading Prävention Compliance-related activities are ongoing, Compliance Reaktion is an integral part of syste
Slide 12: Improving our financial performance
Improving our financial performance
Slide 13: We will address all P&L line-items
We will address all P&L line-items GROSS MARGIN • Growth opportunities in high-profitability areas • LOA1) process and Project management Impact on gross margin: improvement of ~200bps AMBITION 2) ADDRESSING BOTH LINE ITEMS EBITA margin • Process and IT harmonization increase of • Procurement ~500bp
Slide 14: Initiatives for higher efficiency and lower costs
Initiatives for higher efficiency and lower costs IT PROJECTS PROCUREMENT INITIATIVE Status of process and system harmonization (ERP-System): Increasing number of e-auctions to improve the competitive Template solution set up advantage Degree of completion: 40% Reduced prices for direct mate
Slide 15: SG&A ratio shows positive trend
SG&A ratio shows positive trend Adjusted SG&A expenses [€ m] Highlights • SG&A ratio continues to 99 move towards target level 92 90 94 89 91 86 87 76 • Streamlining of processes SG&A • Reduction of complexity in expenses structures, organization and [€ m] governance • Adjustment of admin headcount
Slide 16: Additional working capital improvement initiatives
Additional working capital improvement initiatives Targeting ~85% of trade receivables and WIP in a category-specific approach Reporting and Management information Awareness, Education and Coaching ▪ Develop and implement reporting improvements: ▪ Roll-out E-learning on working capital management ag
Slide 17: Portfolio rotation 2019 and 2020
Portfolio rotation 2019 and 2020 Further margin enhancement while keeping a sound balance sheet Funding sources: Re-Investment: Margin 1. Disposal Other Operations (OOP) ▪ Strengthening accretion 2 „accretive“ legal entities to be sold growth regions 2. Potential disposal of selected margin- ▪ Stren
Slide 18: Guidance 2019, Targets 2020 and Wrap-up
Guidance 2019, Targets 2020 and Wrap-up
Slide 19: Market environment: Europe
Market environment: Europe Demand in offshore maintenance remains strong Greenfield Petrochem projects in Antwerp Polyolefin projects plateauing, fertilizer bottoming out Upcoming gas infrastructure technology projects (Northstream, Baltic Pipe, German LNG terminal in Brunsbüttel) Market opening for
Slide 20: Market environment: North America & Middle East
Market environment: North America & Middle East Upstream O&G – Release of Opex funding, e.g. in Permian Oil & Gas upwards trend continues (KSA, UAE and Qatar Basin and Gulf of Mexico remains steady plan field expansions) Midstream stabilizing. Production up despite US rig count In Country Value (ICV
Slide 21: Outlook 2019: next step on our way to reach targets
Outlook 2019: next step on our way to reach targets in € million Actual FY 2018 Expected FY 2019 Revenue 4,153 Mid single-digit organic growth EBITA adjusted 65 Significant increase to more than €100m Free Cash Flow reported -4 Positive1) 1) Notwithstanding IFRS16 effect: break-even Bilfinger SE | C
Slide 22: Bilfinger 2020 Financial ambition
Bilfinger 2020 Financial ambition Organic Growth Profit Cash Return • EBITA adjusted ~5% • Positive adj. FCF from Post-tax • Gross margin 2018 onwards ROCE reported: >5% CAGR improvement by ~200bps • Over the cycle, from 2018 8 to 10% based on revenue FY 2017 • SG&A ratio reduction by onwards: Cash
Slide 23: Bilfinger 2020: Build up phase on track
Bilfinger 2020 Build up phase on track Value Stabilization Build up Build out • Strategy defined • Top line growth resumed • Process and System • Organization announced • First successes in new growth areas harmonization fully rolled out • Execution master plan • New organization in full
Slide 24: The Bilfinger Investment Case
The Bilfinger Investment Case: Turnaround case based on favorable business model Structural demand for industrial Favorable business Financial soundness services characteristics • BB / stable outlook • ~55% of output in recurring • 35% equity ratio (as of Dec 31, • Increasing # of Industrial plants
Slide 25: Financials Q2 2019
Financials Q2 2019
Slide 26: Bilfinger delivers robust Q2 2019
Bilfinger delivers robust Q2 2019 Continued high demand in our markets Orders received on high prior-year level, strong organic revenue growth based on good order backlog Improved adjusted EBITA driven by positive margin development of E&M segments, Technologies still in turnaround Net profit report
Slide 27: Orders received on high prior-year level
Orders received on high prior-year level Development of orders received -1%/+1% • Orders received 1,139 1,105 1,114 1,133 Stable development (-1% / org.: 971 696 670 798 +1%) driven by the base 765 Orders (61%) (61%) 748 business with orders <€5m (69%) (70%) received (77%) (prior-year quarter was (€
Slide 28: Continued strong revenue growth; EBITA adjusted above prior year
Continued strong revenue growth; EBITA adjusted above prior year Development of revenue and profitability • Revenue +8%/+11% +8% increase (org.: +11%) due 1,115 1,147 to strong order backlog and 1,058 1,052 1,008 Revenue 1.5% good demand 1.1% (€ million) 3.3% -0.4% 2.1% • Adjusted EBITA Improved to
Slide 29: Gross profit impacted by underperformance in Technologies
Gross profit impacted by underperformance in Technologies Adjusted SG&A ratio improved to 7.9%, target of 7.5% for 2020 confirmed Adjusted gross profit (€ million) Adjusted selling and administrative expenses (€ million) 95 97 (9.0%) 82 (8.5%) 0 (8.1%) 0 12 11 5 0 -103 -94 -102 95 97 (-9.7%) (-9.3%)
Slide 30: Segment Technologies: underperformance of single entity
Segment Technologies: underperformance of single entity, action plan in place Development of revenue and profitability • Orders received +7%/+6% +5% (org.: +5%) above prior year 145 quarter 127 128 136 118 Revenue • Book-to-Bill (€ million) -2.6% At 0.8, currently focus on profitability improvement
Slide 31: Segment E&M Europe: margin shows positive trend
Segment E&M Europe: margin shows positive trend Development of revenue and profitability • Orders received +1%/+2% +8% above prior year quarter 710 (org.: +8%) based on strong 706 695 705 635 demand in Northwest Europe Revenue 5.3% (€ million) 4.0% • Book-to-Bill 1.1 supports continuous growth 4.7%
Slide 32: Segment E&M International: strong revenue growth
Segment E&M International: strong revenue growth, good quarter in North America Development of revenue and profitability • Orders received +53%/+44% -18% (org.: -23%) below strong 267 prior-year quarter with large project 222 in the US Revenue 213 174 191 (€ million) 10.5% • Book-to-Bill: 0.9 1.8% 2
Slide 33: Cash flow and DSO improved against prior year
Cash flow and DSO improved against prior year and prior quarter Adjusted Adjusted operating cash flow1) (€ million) Net profit (€ million) net profit (€ million) 11 Adjust- 8 ments Continuing operations 12 21 17 6 3 -25 Discontinued -1 Reported -41 -8 -19 operations -9 -6 Q2/18 Q2/19 Q2/18 Q2/19 Q2/
Slide 34: Successful refinancing of Bond maturity 12/2019
Successful refinancing of Bond maturity 12/2019 Increased interest rate, but lower total debt New financing mix with staggered maturity profile and broader investor base Financial debt by 12/20181): Expected financial debt by 12/20191): Debt Maturity Profile €500m €373m as of June 30, 2019 Bond Matu
Slide 35: Disclaimer
Disclaimer This presentation has been produced for support of oral information purposes only and contains forward- looking statements which involve risks and uncertainties. Forward-looking statements are statements that are not historical facts, including statements about our beliefs and expectation