Bang & Olufsen A/S · OMXCOP:BO
Bang & Olufsen A/S — FY2005/06 Earnings Presentation
27 slides from Bang & Olufsen A/S's earnings presentation, Aug 21, 2006
Slide 1: Bang & Olufsen Group Annual Report 2005/06
Bang & Olufsen Group Annual Report 2005/06
Slide 2: Headlines
Bang & Olufsen Group Headlines • Profit before tax DKK 431 million, an increase of DKK 51 million (13 %) • Turnover DKK 4,225 million, an increase of DKK 483 million (13 %) • Satisfactory turnover development for all European markets • Profitability is improved - EBIT now 10.4 % • Continued focus on
Slide 3: Net turnover
Bang & Olufsen Group Net turnover • The TV portfolio saw an increase in turnover of DKK 286 million • Turnover distribution Brand. busin. DKK 3,964 million +12 % Medicom a/s DKK 198 million + 8 % ICEpower a/s DKK 100 million +100 % Internal turnov. DKK -37 million __________________________ Total DK
Slide 4: Operating profit
Bang & Olufsen Group Operating profit • EBIT of 10.4 % increased from 10 % - driven by the increase in turnover. • Gross margin 46.0 declined as expected because of change in product mix. • Increase in development activities. • Increased marketing pressure. • Buying of shops in Australia. 4
Slide 5: Result before tax
Bang & Olufsen Group Result before tax • Exchange rate adjustment from DKK 10 million to DKK -13 million. 5
Slide 6: Result for the year
Bang & Olufsen Group Result for the year • Tax on result for the year amounts to DKK 135 million corresponding to a tax rate of 31.3. - The Group has not capitalised - the tax losses regarding the US. 6
Slide 7: Total assets
Bang & Olufsen Group Total assets • Capitalised development costs 2005/06 - DKK 165 million against DKK 111 million in 2004/05. • Inventories increased by DKK 138 million. • Trade receivables increased by DKK 106 million. • Cash decreased by DKK 229 million to DKK 503 million. 7
Slide 8: Cash flow
Bang & Olufsen Group Cash flow • DKK 298 million spent on shareholder related initiatives. - Repurchase of shares - DKK 149 million. - Dividend DKK 149 million. • Repayment of loans amount to DKK 39 millions. • Loan of Euro 10 million raised for building a new plant in the Czech Republic. 8
Slide 9: Shareholder related initiatives
Bang & Olufsen Group Shareholder related initiatives: • Proposed dividend of DKK 16 per nominel DKK 10 share, approx. DKK 199 million. • Repurchase of own shares amounting to approx. DKK 300 million during the financial year. 9
Slide 10: Branded business: Turnover per market 2005/06
Bang & Olufsen Branded business Turnover per market 2005/06 10
Slide 11: Branded business: Growth in turnover per market
Bang & Olufsen Branded business Growth in turnover per market in 2005/06 (local currency) 11
Slide 12: Branded business: Shops world-wide 2001/02 - 2005/06
Bang & Olufsen Branded business Shops world-wide 2001/02 - 2005/06 • Changes in numbers of shops: B1 +53 SIS -41 Other -37 ______________ Total -25 12
Slide 13: Branded business: Number of B1-shops per market
Bang & Olufsen Branded business Number of B1-shops per market 31.05.06 • Total number of B1-shops: 725 New shops 61 Upgrades from SIS 31 Closed shops -30 Downgrades -9 _________________________ Net 53 13
Slide 14: Branded business: Turnover share per shop segment
Bang & Olufsen Branded business Turnover share per shop segment 2005/06 • Share of turnover per segment: 2005/06 2004/05 - B1 73 % 71 % - SIS 26 % 27 % - Other 1% 2% ____________ 100 % 100 % 14
Slide 15: Branded business: Growth rate in mature shop segment
Bang & Olufsen Branded business Growth rate turnover in the mature shop segment 2005/06 15
Slide 16: New products 2005/06 - BeoVision 7-40
Bang & Olufsen Branded business New products 2005/06 - BeoVision 7-40, 2. quarter 2005/06 16
Slide 17: New products 2005/06
Bang & Olufsen Branded business New products 2005/06 BeoLab 4, 2. quarter 2005/06 BeoLink Media, 2. quarter 2005/06 BeoLab 7-2, 2. quarter 2005/06 BeoLab 7-4, 2. quarter 2005/06 17
Slide 18: New products 2005/06
Bang & Olufsen Branded business New products 2005/06 Serene, 3. quarter 2005/06 BeoLink Wireless, 4. quarter 2005/06 BeoSound 3, 4. quarter 2005/06 BeoSound 4, 4. quarter 2005/06 18
Slide 19: Carfi Advanced sound systems for cars
Carfi Advanced sound systems for cars 2005/06: • December 2005 - launch of the first audio system in co-operation with Audi (A8 and S8). • New standard within high-end car stereo. • Received very positively. • Several awards and international recognition. • Sales exceeding the expectations.
Slide 20: Medicom a/s: Turnover and result before tax
Bang & Olufsen Medicom a/s Turnover and result before tax • Increase in turnover DKK 14 million (8 %). • Decrease in gross profit. • Substantial one off payment in 2004/05. • Development costs for DKK 13 million compared to DKK 8 million last year. 20
Slide 21: ICEpower a/s: Turnover and result before tax
Bang & Olufsen ICEpower a/s Turnover and result before tax • Turnover growth DKK 50 million (36 %). • 90 % of turnover is now to the Groups external customers. 21
Slide 22: Expectations for the financial year 2006/07
Bang & Olufsen Group Expectations for the financial year 2006/07: • Growth in turnover 8-10 %. • Result before tax DKK 460-500 million. • Opening of 50 B1-shops. • Continued high launch frequence of new products. 22
Slide 23: Expected product launches 2006/07
Bang & Olufsen Group Expected product launches 2006/07: BeoSystem 3 (1. quarter 2006/07) • Strong global TV-platform, setting new standard within picture • quality and sound reproduction. BeoCenter 6-23 (1. quarter 2006/07) • New audio/video center with build-in FM- and digital radio, which in its e
Slide 24: Expected product launches 2006/07
Bang & Olufsen Group Expected product launches 2006/07: BeoVision 9 (2. quarter 2006/07) • New high-end plasma TV. BeoVox 1 (2. quarter 2006/07) • New loudspeaker for inwall use. BeoVision 8 (2. half 2006/07) • New flatscreen TV in 26” and 32” adressing the former MX and BeoVision 3 segment. 24
Slide 25: Expected product launches 2006/07
Bang & Olufsen Group Expected product launches 2006/07: BeoVision 7-40 (2. half 2006/07) • Launch in USA, Japan and Korea. BeoLab 9 (3. quarter 2006/07) • New floor based loudspeaker. The new BeoLab 9 will performance • and price-wise replace the former BeoLab 1. DVD-recorder (4. quarter 2006/07) 25
Slide 26: Carfi Advanced sound systems for cars: Expectations
Carfi Advanced sound systems for cars Expectations: • New contracts to be signed with Audi. • Focused sales and prototype work directed at other leading brands. • New cooperation agreements signed during 2006/07. • Turnover 2006/07: DKK 50-70 million. • Negative EBIT. New products demand investments
Slide 27: Ambition for the coming years
Bang & Olufsen Group Ambition for the coming 4 years: • Net addition of 50 B1-shops per year. • Increased marketing pressure. • Increased launch frequence - and increased investments in product development. • Organic growth of minimum 6-8 % within established business areas. • Growth within new busi