Burckhardt Compression Holding Ag · SIX:BCHN
Burckhardt Compression — Investor Day (November 2020)
90 slides from Burckhardt Compression's investor day presentation, Nov 4, 2020
Slide 1: Capital Markets Day
CAPITAL MARKETS DAY NOVEMBER 4, 2020, WINTERTHUR
Slide 2: Disclaimer
Disclaimer The contents of this document, including all statements made therein, are based on estimates, assumptions and other information currently available to the management of Burckhardt Compression. This document contains certain statements related to the future business and financial performan
Slide 3: Our objective today is to provide you with a clear understanding of…
Our objective today is to provide you with a clear understanding of… The dynamics that How we are adapting to The strength of our underpin growth in our the evolving market positioning end markets megatrends globally The strategic levers to Our M&A strategy and Our MRP 2022 improve the top- and appr
Slide 4: Agenda
Agenda 11:00am – 11:10am Welcome Marcel Pawlicek 11:10am – 11:20am Chairman’s Introduction Ton Buechner 7 Burckhardt Compression Today 10 11:20am – 12:50am Market Positioning Marcel Pawlicek 19 Strategic Framework incl. Q&A 35 12:50pm – 1:15pm Break 1:15pm – 2:00pm Systems Division incl. Q&A Fabrice
Slide 5: Today's Speaker
Today’s Speaker GROUP GROUP GROUP SYSTEMS SERVICES CHAIRMAN CEO CFO DIVISION DIVISION Ton Buechner Marcel Pawlicek Rolf Braendli Fabrice Billard Rainer Duebi 2020 Capital Markets Day | November 4, 2020 5
Slide 6: Five key messages
Five key messages Geographical The integrated Well positioned to Committed to Disciplined positioning and Systems and participate and reach MRP 2022 approach to large customer Services business benefit from new group targets and capital allocation base offer scale model provides applications and fur
Slide 7: Chairman's Introduction
1. Chairman’s Introduction Ton Buechner 2020 Capital Markets Day | November 4, 2020 7
Slide 8: Ton Buechner, Chairman of the Board of Directors
Ton Buechner Chairman of the Board of Directors Swiss and Dutch citizen Master of Science in Civil Engineering from Delft University of Technology, The Netherlands Master of Business Administration from IMD, Lausanne, Switzerland Professional background Other activities and commitments 2012 – 2017
Slide 9: Recent developments and core priorities
Recent developments and core priorities Assumed Chair on July 3, 2020 Structured succession process ensured a smooth transition CHANGE IN CHAIRMANSHIP Highly motivated to build on Mr. Valentin Vogt’s tenure and guide the company 1 through the next phase of its rich history Supervisory Board
Slide 10: Burckhardt Compression Today
2. Burckhardt Compression Today Marcel Pawlicek 2020 Capital Markets Day | November 4, 2020 10
Slide 11: 175+ year history of evolution, innovation and excellence
175+ year history of evolution, innovation and excellence 1844 1883 1920 1935 1948 1951 Franz Burckhardt Development of Development of Development of the Develops special Order of 11 Hyper founded Burckhardt the first single ammonia synthesis first Labyrinth Piston compressor with Compressors for 19
Slide 12: Burckhardt Compression snapshot
Burckhardt Compression snapshot market share with 30%+ CHF CH 629.6 mn leading market position in revenues in 2019 key applications Capturing GROWTH INTEGRATED business opportunities in new model underpins applications driven by change #1 Global Leader in unique in environmental regulations Reciproc
Slide 13: Status 2020: On the way to achieving our 2022 ambitions
Status 2020: On the way to achieving our 2022 ambitions BC GROUP Sales CHF 700mn Live values and behaviors Keep leading market position in SYST Improve overall profitability Become a leading Services provider EBIT Margin of 10 – 15% Strengthen global capabilities Sustainable value increase SYSTEMS D
Slide 14: Solid financial performance within a challenging market environment
Solid financial performance within a challenging market environment ORDER INTAKE GROUP SALES & EBIT MARGIN EARNINGS PER SHARE CHF mn 658.7 CHF mn and % 700.0 CHF 607.3 9.56 629.6 9.12 525.2 594.6 599.3 474.9 8.51 230.7 557.7 8.15 246.1 10–15% 205.4 194.3 8.6 8.7 428.0 7.0 7.4 319.8 361.2 280.6 2016
Slide 15: Systems Division back to profitability while Services Division operationally geared up to deliver
Systems Division back to profitability while Services Division operationally geared up to deliver SYSTEMS DIVISION (SALES & EBIT MARGIN) SERVICES DIVISION (SALES & EBIT MARGIN) CHF mn and % CHF mn and % 367.2 384.4 375.4 388.3 340 27.8 25.9 26.0 360 22.7 1.7 0– 5% 223.9 241.3 20–25% 190.5 210.2 -0.4
Slide 16: Local presence strengthened via acquisitions and collaborations
Local presence strengthened via acquisitions and collaborations; Strategically positioned to capture upside 2020 Capital Markets Day | November 4, 2020 16
Slide 17: Global coronavirus pandemic accelerates strategic approach
Global coronavirus pandemic accelerates strategic approach Acceleration Acceleration of Resilience strategic initiatives Limited impact on around digitalization, operating activities, sustainability including business continuity human capital and maintained thanks to technological employee mobilizat
Slide 18: Business model remains robust and provides solid platform for further growth
Business model remains robust and provides solid platform for further growth Resilient business model underpinned Platform to enhance customer by geographical and segmental value proposition and drive diversification growth in Services Services Division (SERV) Systems Division (SYST) Corporate Funct
Slide 19: Market Positioning
3. Market Positioning Marcel Pawlicek 2020 Capital Markets Day | November 4, 2020 19
Slide 20: Addressing the diversity of gas and related challenges
Addressing the diversity of gas and related challenges gas Compression for /gas/ No shape or volume and can be either: • A single element (e.g. hydrogen) O2 Oxygen • A compound of elements (e.g. carbon dioxide) • A mixture of several gases in any combination (e.g. air) 1 Reduction of volume in gener
Slide 21: Diverse and evolving range of industrial applications and end products
Diverse and evolving range of industrial applications and end products Industrial Applications New applications are emerging…. Transport & Storage Refinery Petrochemical & Chemical Industrial Gases Hydrogen as a fuel LNG on- and off-shore Hydrotreater Industry Hydrogen production Natural g
Slide 22: Breaking down the life cycle of a typical project
Breaking down the life cycle of a typical project Duration 1-3 Years 10-22 Months 1-12 Months 1-2 Months 2 Years (avg) 40 Years (avg) Phase Evaluation and start Manufacturing of construction compressor system Compressor installation Start-up compressor Warranty period Post warranty Decision maker En
Slide 23: Customer trends underpin necessity for Systems and Services Division to cover the entire value chain
Customer trends underpin necessity for Systems and Services Division to cover the entire value chain Fundamental demand drivers Ongoing trends driving Systems and Services Division SYST SERV Continued focus on energy efficiency/savings, energy recovery and reduction of CO2 emissions ++ ++ Increased
Slide 24: Stable blue-chip customer base
Stable blue-chip customer base Gas Gathering & Petrochemical/ Industrial Gas/H2 Mobility Gas Transport & Storage Refinery Processing Chemical Industry & Energy 2020 Capital Markets Day | November 4, 2020 24
Slide 25: Market leadership protected by high entry barriers and competitive strengths
Market leadership protected by high entry barriers and competitive strengths Entry barriers References and Excellence in Global presence Low and predictable Technology and application experience project execution with local support downtimes expertise Reliable and highly Purely focused on Lowest l
Slide 26: Systems Division operating in broadly stable markets
Systems Division operating in broadly stable markets; Cyclicality compensated by diversity of applications and geographical footprint APAC ex China 2018-22 market development: NORTH AMERICA Slightly growing with 2018-22 market development: 32% EMEA regional differences Some growth expected 2018-22 m
Slide 27: Well-positioned to defend and grow in different segments and regions
Well-positioned to defend and grow in different segments and regions Systems Division Services Division Market BC Approach / Growth Key Drivers Key Markets Throughput Share Opportunities Age of oil fields (EOR) Service potential for 30 to 40 years Gas Gathering & CAPEX spend Increase share o
Slide 28: Strong market share overall strengthened through acquisitions in China and Japan
Strong market share overall which has been strengthened through acquisitions in China and Japan Petrochemical- & Industrial Gas Transport & Storage Refinery Chemical Industry Gases 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Note: Recip market Compressor Power > 150 kW, excl. High-Speed and Gas Gath
Slide 29: Significant potential to grow from our current position in Services
Significant potential to grow from our current position in Services NAM total market: CHF 0.5bn EMEA total market: CHF 1.0 bn BC market share**: APAC total market: High single digits BC market share**: CHF 1.0 bn ~9% Burckhardt 16’000 High single digits market share in value compressors BC Machines:
Slide 30: Market positioning in Services Division underpins opportunity for accelerated growth
Market positioning in Services Division underpins opportunity for accelerated growth Position Market dynamic Drivers Key markets and growth opportunities Relatively stable Refinery, Petrochemical & Chemical Industry Strong position in OEM with > Availability of mission critical Spare Parts
Slide 31: Adjusting to changing customer requirements critical in improving our service proposition
Adjusting to changing customer requirements critical in improving our service proposition Preventive maintenance will remain an Preventive Maintenance important role Installation and Commissioning SERVICE CASES Corrective Maintenance Monitoring & Diagnostics Service cases will play an import
Slide 32: Megatrends support long-term fundamentals
Megatrends support long-term fundamentals Demographics and Climate and Technology Regional dynamics economic power regulation World population growth Changing energy mix (natural Phase out of less efficient Shift of gas production to leads to increasing demand gas, renewables, etc.) technolo
Slide 33: Megatrends: Changing energy mix supports natural gas and hydrogen demand
Megatrends: Changing energy mix supports natural gas and hydrogen demand Energy mix shift towards natural gas (and H2 mobility and energy market provides new opportunities renewables) Source: BP Energy Outlook 2020 Edition 2020 Capital Markets Day | November 4, 2020 33
Slide 34: Market dynamics inform strategic approach
Market dynamics inform strategic approach SYSTEMS DIVISION SERVICES DIVISION Broadly stable markets with strong Significant potential to grow from current 9% market share and positioning but growth market share within a fragmented competitive opportunities exist in specific regions and landscape
Slide 35: Strategic Framework
4. Strategic Framework Marcel Pawlicek 2020 Capital Markets Day | November 4, 2020 35
Slide 36: Performance ambition: Vision for acknowledged market leadership
Performance ambition: Vision for acknowledged market leadership Vision To be our customers' first choice for gas compression solutions across the Focus entire product life cycle. Deliver on our key priorities with clear goals defined by our performance ambition and measure progress: Credibility Dedi
Slide 37: Core strategic objectives remain unchanged, but priorities refined
Core strategic objectives remain unchanged, but priorities refined to drive improved growth and value creation 2022 Strategic priorities Innovation and product offering 01 Achieve revenue growth and 02 Ensure SYST maintains Digitalization drive margin expansion profitable growth trajectory Enabling
Slide 38: Continuous innovation and improvements the key to success
Continuous innovation and improvements the key to success Strengthen market position: Address customer needs: Capture market opportunities: Reinforce lead on sealing technologies Progress on delivering cleaner propulsion Expanding known product families into and materials systems for the marine busi
Slide 39: Digitalization offers new sources of competitive advantage
Digitalization offers new sources of competitive advantage Improved customer offering Process optimizations Smart factory New ways to interact with customers Improved availability of real-time data at Application of new technologies to New services the right place reduce waste and increase e
Slide 40: Embedding sustainability into our strategic thinking
Embedding sustainability into our strategic thinking “ “ To be customers' first choice for gas compression solutions across the entire product life cycle Live by our Address risks Continue building 01 guiding principles 02 and opportunities 03 a competitive advantage Our Values Our Behaviours Goal
Slide 41: Our core priorities beyond 2022
Our core priorities beyond 2022 Leverage integrated business model Focused on Drive customer centricity sustainable value creation Exploit market opportunity over the long- term Enhance operational efficiency 2020 Capital Markets Day | November 4, 2020 41
Slide 42: Systems Division
5. Systems Division Fabrice Billard 2020 Capital Markets Day | November 4, 2020 42
Slide 43: Progress towards our strategic priorities since 2018
Progress towards our strategic priorities since 2018 Investor Day 2018 Increasing Build-up Build on our share of Optimize Defend Reinforce our required leading the larger costs for position in differentiating capabilities position in markets non-critical Marine market capabilities to “play the PCI R
Slide 44: On track to reach MRP targets
On track to reach MRP targets Strategic goal Sales CHF 340 mn Currently ahead of MRP 2022 targets Keep leading market Reinforced leading position in key applications; Entered new markets position in all segments Use strong global Platform established to deliver despite early integration challenges p
Slide 45: Reinforced leading position in key applications
Reinforced leading position in key applications Key application Market share Comments Low High PCI – LDPE Won all projects but one Defending positions PCI – PE/PP Clear leader. Reinforced with JSW T&S – LNG terminals Various technologies and competitors T&S – LNGM Market moved to low-pressure T&S –
Slide 46: Benefits of critical scale and leadership in recip niches
Benefits of critical scale and leadership in recip niches Market- Competitive oriented solutions Innovation Competent Feedback from and focused existing sales force installations Competitive offering and pricing Strong power (technical) Influencing service specifications network References for Depth
Slide 47: SYCC acquisition strengthens our position…
SYCC acquisition strengthens our position… SYCC in a nutshell Major benefits from the acquisition Leading local player in Refinery and Petrochemical/Chemical For BC: Industry market - Stronger penetration of Chinese customer base 650 highly dedicated employees - Expand product range: High-Spee
Slide 48: … and ability to capture additional opportunities
… and ability to capture additional opportunities Entering new markets with global presence & SYCC products Offering package deal to increase share of wallet High-Speed Compressors for Eastern Europe Combined package for customer in CIS country through Korean EPC (Nov. 2019) (Sept. 2020) 1x Laby® 2x
Slide 49: Driving operational excellence through a focused approach
Driving operational excellence through a focused approach Cost for LNGM skid reduced by 10 – 35% Strong increase of Gross margin for Process Gas compressors 40 value engineering measures, such as: Pricing discipline through delegation of authority - Re-defined design parameters (e.g. temperature
Slide 50: Way forward: Continued focus on execution of strategic initiatives
Way forward: Continued focus on execution of strategic initiatives to achieve short- and long-term objectives New Marine applications High-Speed Compressors/ BCS Compressors NEW MARKETS Hydrogen mobility and energy TO BALANCE Bio-mass and CNG CYCLICALITY Continue MRP initiatives Engineer
Slide 51: Operational excellence: Tangible progress made
Operational excellence: Tangible progress made. Further OPERATIONAL EXCELLENCE optimization activities to continue over the short- and mid-term Key application Progress Comments Start End Strategic procurement Continuation of category management Value engineering Focus on auxiliaries Global Support
Slide 52: Focused on developing differentiating capabilities at multiple levels
Focused on developing differentiating capabilities at multiple DIFFERENTIATING CAPABILITIES levels accross the organization Engineering excellence for Unique products with strong “Service-ready” digital Empowered employees with demanding applications references products “BC spirit” “Capability mat
Slide 53: New Marine applications for cleaner propulsion systems
New Marine applications for cleaner propulsion systems NEW MARKETS Four new Marine applications developments since start of MRP 1 2 3 4 Oil free high pres. Marine High-pressure New Laby Compressor Low pressure LP250 for ME-GI LNG for small MEGI ships. for X-DF merchant Laby package for tankers. New
Slide 54: High-Speed compressors offer potential upside
High-Speed compressors offer potential upside NEW MARKETS A variety of targets markets and references from SYCC. Offshore gas platform Natural gas pipeline CNG standard station Chemical plant Customer: CNOOC Customer: Sinopec Customer: Xindi Customer: Shanxi Power: 280 kW Power: 3 MW Energy Huayang
Slide 55: Hydrogen mobility and energy can become a game changer
Hydrogen mobility and energy can become a game changer NEW MARKETS Transportation: # and size of fuel stations in the US expected H2 production expected to increase 10-fold in next 30 years to increase fast Global energy demand supplied with hydrogen, EJ # of hydrogen fueling stations in the US 78 4
Slide 56: Compressors a key component in the H2 infrastructure
Compressors a key component in the H2 infrastructure NEW MARKETS we can support this industry to ramp up volumes and lower costs Transportation: Compressor is a key component and cost Our compressors come into play when fuel stations and filling factor for H2 infrastructure stations become larger Hy
Slide 57: Maintain progress and navigate challenging operating environment
Maintain progress and navigate challenging operating environment Strategic goal Outlook Sales CHF 340 mn Top line progression dependent on coronavirus impact and timing of new applications Keep leading market Maintain current leadership positions; Accelerate in new markets position in all segments U
Slide 58: Services Division
6. Services Division Rainer Duebi 2020 Capital Markets Day | November 4, 2020 58
Slide 59: Progress towards our strategic priorities since 2018
Progress towards our strategic priorities since 2018 Investor Day 2018 Develop Enhance Improve Think Develop service differentiating speed to customer, service setup and capabilities market act service brand offering Organic growth on BC and OBC business Progress to date - Executed 50+ larger projec
Slide 60: Current status of MRP goals
Current status of MRP goals Strategic goal Sales CHF 360 mn, grow Slower progression than anticipated within the context of challenging environment 6 – 8% per year Becoming a leading Improved customer perception (+11% vs. FY18), with ca. 50% business volume in service provider in our ‘purely’ servic
Slide 61: Continual improvement in enhancing our service brand identity
Continual improvement in enhancing our service brand identity “We got excellent response from “We improved our “Effective and efficient response to “Proactive approach to site needs the local team of X during our MTBR/F for two troubleshooting. Field service is (viz. Maintenance scheduling, spare re
Slide 62: Shifting customer priorities creates additional service opportunities
Shifting customer priorities creates additional service opportunities Customer Dynamics Change from reactive to proactive maintenance strategies: “We have the clear goal to better Offer flexible maintenance solutions that are predict and plan maintenance interventions. based on the operating condi
Slide 63: Key growth drivers in services
Offering services locally, solutions for other brand compressors and services beyond parts represent key growth drivers 60% of sales executed locally vs. centrally 5 authorized partners to enter fast growing markets with low investment since 2018 LOCAL BUSINESS Growing number of long-term serv
Slide 64: Providing customers with local resources whilst leveraging global capabilities
Providing our customers with local resources whilst leveraging LOCAL BUSINESS global capabilities Uniform IT platform to Be GLOBAL, Act LOCAL support all processes Local process responsibility for customer account management, project solutions, field services and Newly developed Customer Portal re
Slide 65: Expansion of the local service footprint is crucial
Expansion of the local service footprint is crucial to cover our LOCAL BUSINESS installed base and capture OBC opportunity Service Setup Nordics Collaboration with local Kompressor Teknik ML AB Joint build up of new service facility Access to local customer network and other brand compressors
Slide 66: Strengthening regional capabilities supports customer orientation
Strengthening regional capabilities supports customer LOCAL BUSINESS orientation and provides resilience to market turbulence Canada Switzerland/Germany Phased expansion approach with Built up global project management and engineering first focus on manufacturing competencies in CH to support co
Slide 67: Marine after sales market is growing thanks to an increased service offering
Marine after sales market is growing thanks to an increased LOCAL BUSINESS service offering 2013 2016 – 2020 Premium fleet service agreement Systems Division Services enters first LTSA* and Prior Vessel Vessel in operation Dry-docking after 5 Phase sell first LNGM deploys after sales strategy for op
Slide 68: Marine business is supported by a dedicated organizational setup
Marine business is supported by a dedicated organizational SERVICE SOULTION setup MARINE SERVICE CAPABILITIES HAVE BEEN LOCATED BASED ON STRATEGIC MARINE HOT SPOTS Neuss, DE Bicester, GB Winterthur, CH Busan, KR Istanbul, TR Madrid, ES Houston, US Panama, Singapore, PA SG Dubai, AE Elandsfontein, ZA
Slide 69: By further digitalizing our services we create speed and convenience
By further digitalizing our services we create speed and SERVICE SOULTION convenience for our customers DIGITAL CUSTOMER PORTAL REMOTE MONITORING/CLOUD REMOTE ASSISTANCE USING DASHBOARD AUGMENTED REALITY Before Before Before Customers order parts and services via Service crews need access to loc
Slide 70: Engineering offerings for other brand compressors create sustainable revenue streams
OTHER Engineering offerings for other brand compressors create BRAND COMPRESSORS sustainable revenue streams Case Study 1: Customer faces urgent technical issue with other Case Study 2: Customer wants to revamp part of compressor brand compressor system (other brand) BC can solve the issue by appl
Slide 71: Rationale for Arkos acquisition remains valid
OTHER Rationale for Arkos acquisition remains valid but challenges BRAND COMPRESSORS exist to extract full potential in the short-term Clear acquisition rationale and multi-faceted opportunities: Platform to sell new equipment in the US Ability to enter downstream service business and regain own
Slide 72: Arkos: proactively addressing market opportunities
OTHER Arkos: proactively addressing market opportunities whilst also BRAND COMPRESSORS focusing on driving underlying profitability Downstream opportunity: Gas Gathering & Processing challenges: Increase coverage of installed base and expand OBC Improve profitability and grow revenue Action plan: Ac
Slide 73: Accelerate progress to achieve MRP ambitions
Accelerate progress to achieve MRP ambitions Strategic goal Outlook Sales CHF 360 mn, grow Magnitude of top line growth dependant on regional macro economic dynamics 6 – 8% per year Becoming a leading service provider in our Maintain momentum in driving visibility and sentiment to the customer indus
Slide 74: Looking beyond the plan: The leading service provider in our industry
Looking beyond the plan: The leading service provider in our industry Enhance differentiating Build up project management and engineering capabilities in the US and expand in APAC capabilities Implement global standards for field service where helpful, and support with modern IT solutions Furt
Slide 75: Financial Review
7. Financial Review Rolf Braendli 2020 Capital Markets Day | November 4, 2020 75
Slide 76: MRP 2022 macro assumptions remain largely valid
MRP 2022 macro assumptions remain largely valid but pandemic has created layer of additional complexity 2018 assumptions Status Update* Oil price (WTI) within a range of USD 40 – 60/barrel 2018: USD 65 2019: USD 57 2020: USD 35-40 (October) Gas price (Henry Hub natural gas spot price) within a range
Slide 77: MRP group ambitions re-iterated
MRP group ambitions re-iterated; Divisional mix and contribution dictated by market conditions and operational developments CHF mn Record order intake levels in FY18 and 19 in Systems Division 700.0 Order backlog provides visibility into future sales pipeline 658.7 594.6 599.3 607.3 629.6 557.7
Slide 78: Systems Division to maintain margins within MRP target-range
Systems Division to maintain margins within MRP target-range and seek profitable growth CHF mn Sales Drivers Current top line strongly supported by the high order backlog from 428.0 340.0 FY18 and FY19 361.2 319.8 Temporary negative effects of coronavirus related impact on 280.6 order intake and
Slide 79: Ambitious MRP growth target in Services Division
Ambitious MRP growth target in Services Division with long-term growth trajectory in place CHF mn Sales Drivers 360.0 MRP 2022 targets include Arkos and further OBC growth Arkos recovery with main focus on more profitable downstream business 230.7 246.1 Increasing base of installed BC machines
Slide 80: Drivers of Free Cash Flow
Drivers of Free Cash Flow EBITDA EBIT MRP objectives, stable depreciation and amortization Collection of overdue A/R, mainly in China General improvement in DSO and DPO from according Group-wide target settings (FY20E DSO -20d; DPO +10d), implemented into monthly divisional leadership cycles
Slide 81: Normalization of CAPEX spend to drive FCF generation
Normalization of CAPEX spend bundled with EBIT growth and NWC management to drive FCF generation going forward FCF Generation in CHF mn 31 32 19 20 1 21 20 22 21 Capital expenditure Changes in working capital 55 48 42 45 Depreciation & amortization Income tax paid -15 -18 -13 -14 EBIT -6 -10 -8 -16
Slide 82: Balance sheet profile reflects recent acquisitions
Balance sheet profile reflects recent acquisitions; Committed to 35 – 40% equity ratio by end of MRP 2022 Equity & Liabilities Structural changes after acquisitions (60% Arkos; 40% SYCC; JSW CHF mn 100%): - Offset of goodwill against equity (in line with Swiss GAAP FER) 900 60% - Equity ratio by t
Slide 83: Sufficient liquidity headroom to deliver on strategic initiatives
Sufficient liquidity headroom to deliver on strategic initiatives Net Debt and Financial Leverage Net Financial Position 100 91.7 5 IN CHF mn FY 2019 H1 2020 90 4.5 68.0 80 4 Borrowings -182.0 -108.3 70 3.5 60 3 Bond 0.0 -100.0 50 2.5 40 2 Cash and cash equivalents 90.3 140.3 30 1.5 20 1.8x 1 Total
Slide 84: RONOA > WACC a key metric for capital discipline
RONOA > WACC a key metric for capital discipline FY 2016 FY 2017 FY 2018 FY 2019 Net Operating Assets (NOA)* 355.4 363.7 361.3 404.2 EBIT 47.7 41.7 44.5 54.8 Tax rate 25.1% 23.5% 21.6% 16.2% Net operating profit after tax 35.7 31.9 34.9 45.9 RONOA 10.1% 8.8% 9.7% 11.4% Key drivers EBIT performance,
Slide 85: Stringent and selective approach to acquisition
Stringent and selective approach to acquisition Focus on reciprocating compressor business Our Strategic Rationale Strengthening local presence/regional expansion Adding on capabilities/product-range Adequate market and competitive dynamics (growth, entry barriers, etc.) Our Financial Ration
Slide 86: Disciplined approach to capital allocation
Disciplined approach to capital allocation Organic investment M&A No major Capex above depreciation Stringent and selective approach to level required during the ongoing acquisitions MRP-period Strategic fit, management profile and RONOA > WACC set as one of the financial track record as key
Slide 87: Conclusion
8. Conclusion Marcel Pawlicek 2020 Capital Markets Day | November 4, 2020 87
Slide 88: Committed to FY 2020 and MRP 2022 targets
Committed to FY 2020 and MRP 2022 targets Guidance FY 2020* Sales > CHF 650 mn EBIT Margin Stable Dividend Policy Payout ratio between 50 – 70% of net profit MRP 2022** Sales CHF 700 mn EBIT Margin 10 – 15% * Even though many countries are currently dealing with a second wave of coronavirus, we have
Slide 89: Five key messages
Five key messages Geographical The integrated Well positioned to Committed to Disciplined positioning and Systems and participate and reach MRP 2022 approach to large customer Services business benefit from new group targets and capital allocation base offer scale model provides applications and fur
Slide 90: 2020 Capital Markets Day | November 4, 2020
2020 Capital Markets Day | November 4, 2020
Burckhardt Compression — Investor Day (November 2020) on 6ix