Eurotech S.p.a. · MIL:ETH
Eurotech — Investor Presentation (March 2006)
39 slides from Eurotech's investor presentation, Mar 2, 2006
Slide 1: Investors Presentation
Digital Technologies for a Better World INVESTORS PRESENTATION MILAN 2 MARCH 2006
Slide 2: Disclaimer
DISCLAIMER This presentation has been prepared by Eurotech S.p.A. (or “Eurotech”) and has to be read in conjunction with its oral presentation. The information contained in this presentation does nor purport to be comprehensive. Neither Eurotech nor any of its officers, employees, advisers or agents
Slide 3: Speakers
SPEAKERS ROBERTO SIAGRI President and Chief Executive Officer MASSIMO MAURI Executive Vice President and Investors Relator 3
Slide 4: Agenda
AGENDA STOCK HISTORY & PERFORMANCE GROUP OVERVIEW INVESTMENT CASE CONCLUSION 4
Slide 5: Stock History
STOCK HISTORY IPO Size 7,45 million primary shares Price IPO € 3,40 per share Raised Capital € 22,3 million including IPO Fees and Costs Outstanding Shares 18,6 million Free-Float Shares Aprox. 58% of outstanding shares Listing Italian Stock Exchange – STAR 5
Slide 6: Stock History
STOCK HISTORY Management ownership Approx 37% Friulia (Ist. Inv.) owners. Approx. 5% Lock-up One year for the Management and for Friulia First Price (30.11.2005) € 3,84 30 day Average Price € 7,86 6
Slide 7: Agenda
AGENDA STOCK HISTORY GROUP OVERVIEW INVESTMENT CASE FINANCIAL HIGHLIGHTS CONCLUSION 7
Slide 8: Group's Structure
GROUP’S STRUCTURE Associated companies 24,8% Emilab srl Emilab 18,2% Inasset srl Inasset Eurotech Eurotech Spa Spa 40% Delos srl Delos 99,9% 100% 100% 100% 80% 63,59% EthLab EthLab Srl Srl Erim Erim Dev. Dev. sas sas Parvus Parvus Corp Corp Eurotech Eurotech Oy Oy IPS IPS Srl Srl Neuricam Neuricam S
Slide 9: The Vision: Digital Technologies for a Better World
THE VISION: Digital Technologies for a better World “ The most profound technologies are those that disappear. They weave themselves into the fabric of everyday life until they are indistinguishable from it ” Mark Weiser "The Computer for the 21st Century", Scientific American - Vol. 265 No.9, pp. 6
Slide 10: Group's Portfolio
GROUP’S PORTFOLIO NanoPC HPC Universities, Transportation, Research institutes Defence Exadron Eurotech (Eurotech Division) Parvus Erim Automation & Control, Security & Surveillance Ascensit Networking Neuricam (Eurotech Division) IPS 10
Slide 11: Products & Markets
PRODUCTS & MARKETS DEFENCE TRANSPORTATION MEDICAL INDUSTRIAL HPC MARKET MARKET MARKET MARKET MARKET Custom HPC Multi Function Train cockpit Human Machine Display Interface Airborne Computer WAN Optimization AVL-AVM Computer Modules Vision Systems & Sensors Standard HPC Advanced Traffic Vehicular Com
Slide 12: Main Clients
MAIN CLIENTS NanoPC Alstom Ansaldo TRANSPORTATION Bombardier MARKET Elsag BA Systems BAE Boeing Galileo Avionica DEFENCE L3 Communication MARKET Lockheed MBDA Rockwell Thales Gendex LMA MEDICAL Varian MARKET Imaje Salvagnini INDUSTRIAL Selca MARKET HPC CILEA DESY COMPUTING CENTRES INFN & RESEARCH IN
Slide 13: International Presence
INTERNATIONAL PRESENCE Germany Finland 1 5 USA 54 China France 1 14 Italy 80 13
Slide 14: Management
MANAGEMENT Strategy & Business Development President & CEO Industrial Operations & Roberto Siagri Information Systems Vice President Vice President Dino Feragotto Massimo Mauri Investor Relations Research & Communication Quality Finance Giampietro Tecchiolli Marco Polo Eros Goi CTO CFO ETH Lab North
Slide 15: Agenda
AGENDA STOCK HISTORY & PERFORMANCE GROUP OVERVIEW INVESTMENT CASE FINANCIAL HIGHLIGHTS CONCLUSION 15
Slide 16: A Story of Growth and Success
A STORY OF GROWTH AND SUCCESS 1992-1994: THE ORIGINS .000 € COMPANY GROWTH 100.000 ¾ 1992: foundation of Eurotech 29.800 ¾ 1993-94: first family of PC/104 Embedded PC modules 10.000 50% GR 1995-2000: FROM LABORATORY TO INDUSTRY r CA – yea 13 ¾ 1997: first high-performance compactPCI CPU Board 1.000
Slide 17: A Business Model Propelled by Innovation
A BUSINESS MODEL propelled by INNOVATION Market and Customers Today’s Markets Tomorrow’s Markets Strategic Marketing Planning Sales Research Development Engineering Production Catalog & Custom Universities and Research Centres 17
Slide 18: Eurotech: The Innovation Model
EUROTECH: THE INNOVATION MODEL DEVELOPMENT High End Market absorption capacity Products’ Performance HP C Low End s g ie High End lo hno Market c te absorption PC capacity PC C es Nano Low End NanoP o gi nol c h te o ne ph STRATEGIC ile ob PLANNING m & A RESEARCH PD Inspired to Christensen’s innovat
Slide 19: Eurotech: The Technological Evolution
EUROTECH: THE TECHNOLOGICAL EVOLUTION HP C Products’ Performance s g ie o lo chn te PC PC C Nano NanoP s g ie Custom HPC o nol ies h Standard HPC (PC based) c te og o ne n ol Embedded-PC (CompactPCI) ph ech Embedded-PC (PC/104) ile t ob ID m RF Wearable PC & A Sensor Networks PD Time ‘92 ‘97 ‘02 ‘05
Slide 20: Eurotech Products: Evolution
EUROTECH PRODUCTS: EVOLUTION COMPUTERS will be more MINIATURIZED and INTERCONNECTED through the GRID They will WEAVE themselves into the ENVIRONMENT of everyday life until they are indistinguishable from it.. The 3^wave is coming (2005-2015): the beginning of the Pervasive Computer Era 20
Slide 21: Pervasive Computing & Grid: Future Scenarios
"PERVASIVE COMPUTING" & GRID : FUTURE SCENARIOS “ Someday soon, more than one million businesses will be connected HPC to more than one billion people by one trillion devices” L.V. Gerstner NanoPC ID R G “It's already beginning to happen … But we'll see even more tremendous growth when intelligence
Slide 22: Research Links
RESEARCH LINKS STRATEGIC AGREEMENTS ¾Italian National Institute for Nuclear Physics (INFN) HPC (Supercomputer) ¾Institute for Scientific Research and Technology of Trento Pervasive Computer (SOC) ¾INDO/Italian Research Centre Pervasive Computing (GRID) ¾Omega Consortium HPC (GRID) RESEARCH AGREEMENT
Slide 23: Agenda
AGENDA STOCK HISTORY & PERFORMANCE GROUP OVERVIEW INVESTMENT CASE FINANCIAL HIGHLIGHTS CONCLUSION 23
Slide 24: Revenues
REVENUES REVENUES, YTD 2003-2005 (€ mln) 29,9 30 +59% 25 20 18,8 EUROPE ALL ORGANIC +60% GROWTH 15 US 11,7 GROWTH OTHER 10 THROUGH ACQUISITIONS 10% ORGANIC 5 GROWTH 50% 0 2003 2004 2005 03/04 Italian GAAP, 05 IFRS 24
Slide 25: Gross Profit Margin
GROSS PROFIT MARGIN GROSS PROFIT MARGIN, YTD 2003-2005 5,91 10,16 15,29 € Mln 60% 50% 40% 30% 50% 54% 51% 20% 10% 0 2003 2004 2005 25
Slide 26: EBITDA & EBIT
EBITDA & EBIT EBITDA, YTD 2003-2005 4 0,84 1,88 3,30 € Mln 3 11,1% 2 10% 1 7,2% EBIT, YTD 2003-2005 2003 2004 2005 0,17 1,02 2,31 € Mln 3 2 7,7% 1 5,4% 1,4% 2003 2004 2005 26
Slide 27: Net Working Capital, Capex, Equity and Net Debt
NET WORKING CAPITAL, CAPEX, EQUITY AND NET DEBT NWC, YTD 2003-2005 CAPEX, YTD 2003-2005 € Mln 6 € Mln 4 47% ON REV. INTANGIBLES TANGIBLES 27% ON REV. 2,72 2,84 2,83 3 4 5,48 5,03 2,24 7,5% ON REV. 2 2 2,24 1 0 0 2003 2004 2005 2003 2004 2005 * 2004 IFRS ACCOUNT EQUITY AND NET DEBT, YTD 2003-2005 D/E
Slide 28: Agenda
AGENDA STOCK HISTORY & PERFORMANCE GROUP OVERVIEW INVESTMENT CASE FINANCIAL HIGHLIGHTS CONCLUSION 28
Slide 29: A Clear Strategy
A CLEAR STRATEGY … MAINTAINING OUR TECHNOLOGICAL LEADERSHIP ¾ in miniaturization ¾ a specific research structure: THROUGH (small dimensions/low-power consumption) Eth Lab ¾ in computer interconnection (high-speed short-distance/wireless low-power long-range) ¾ strategic research agreements RAPIDLY I
Slide 30: A Clear Strategy ... and Consistent Delivery
A CLEAR STRATEGY … and CONSISTENT DELIVERY MAINTAINING OUR TECHNOLOGICAL LEADERSHIP Start of ETH-lab and signature of a ¾ in miniaturization ¾ a specific research structure: THROUGH LOIdimensions/low-power (small for a new Research Agreement consumption) Eth Lab with ITC-IRST with the approval and s
Slide 31: External Growth: Arcom Rationale
EXTERNAL GROWTH: ARCOM RATIONALE FOR ARCOM ACQUISITION ¾ Strategic geographical markets positioning (UK and North America) ¾ New End Markets (gas&oil and industrial control) ¾ Profitable company ¾ Experienced management team ¾ Similar business model ¾ Outsourcing ¾ from boards to systems & software
Slide 32: Arcom Acquisition
ARCOM ACQUISITION Think Embedded, Think Arcom ¾ Founded in 1982, part of Spectris Group since 1984 ¾ Spectris Plc is listed on the FSTE (600M£ market cap) ¾ Sales 2005: 29,3 M USD ¾ EBITDA 2005: 3,2 M USD ¾ Headquarter : Cambridge (UK) ¾ Subsidiary: Kansas City (USA) ¾ Total Employees: 96 32
Slide 33: Arcom: Revenues
ARCOM: REVENUES REVENUES, YTD 2002-2005 $ Mln 30 29,3 +14,9% 25,5 25 +19,4% 21,4 20 +32,2% 16,2 15 10 5 0 2002 2003 2004 2005 33
Slide 34: Arcom: Acquisition Price
ARCOM: ACQUISITION PRICE ¾ Acquisition price based on EV/EBITDA multiple ¾ The sale of the business will be made on a cash and debt free basis ARCOM EQUITY VALUE 24,6 Mln USD 27,8 Mln USD 7,5x EUROTECH OFFER: 8,5x EV/Ebitda 26 mln USD (approx. 21,3 mln €) EV/Ebitda EV/EBITDA = 7,9 X 36
Slide 35: Eurotech + Arcom: International Presence
EUROTECH + ARCOM: INTERNATIONAL PRESENCE Germany Finland 1 5 USA 29 China U.K 1 67 USA 54 France 14 Italy 80 ARCOM EUROTECH 37
Slide 36: Eurotech + Arcom: Revenue Breakdown
EUROTECH + ARCOM: REVENUE BREAKDOWN REVENUE BREAKDOWN BY GEOGRAPHICAL AREA, ‘05 EUROTECH ARCOM EUROTECH + ARCOM 4% 9% 7% 23% 25% 28% 49% 41% 13% 11% 55% 19% 16% ITALY CONT. EUROPE UK USA ROW 38
Slide 37: Eurotech + Arcom: Revenues
EUROTECH + ARCOM: REVENUES AGGREGATE REVENUES, YTD 2003-2005 (€ mln) 60 53,9 50 40 39,4 EUROTECH 24,0 GROUP 30,7 ARCOM 30 20,6 20 19,0 10 11,7 18,8 29,9 0 2003 2004 2005 39
Slide 38: Eurotech + Arcom: EBITDA
EUROTECH + ARCOM: EBITDA AGGREGATE EBITDA, YTD 2003-2005 5,99 (€ mln) 6 5 2,69 EUROTECH 4 GROUP 3,61 ARCOM 3 2,52 1,73 2 1,68 3,30 1 1,88 0,84 0 2003 2004 2005 40
Slide 39: Thank You for Your Attention
THANK YOU FOR YOUR ATTENTION "There is one thing stronger than all the armies in the world: it is an idea whose time has come." "On résiste à l'invasion des armées; on ne résiste pas à l'invasion des idées.“ Victor Hugo, Paris 1877 41