Company Presentation June, Antti Heinola, CFO Milena Hæggström, Head of Investor Relations

Transcription

1 Company Presentation June, 2016 Antti Heinola, CFO Milena Hæggström, Head of Investor Relations

2 Contents Business and strategy Market overview Financials

3 Business and strategy

4 in brief designs, builds, operates and maintains user-friendly and energy-efficient solutions for buildings, infrastructure and industrial plants. Revenue by division in 2015 EBIT 61 EUR million 2.2% of revenue Germany 22% Sweden 22% Denmark-Norway 21% Industrial Solutions 15% Finland 12% Austria 6% Eastern Europe 3% Key figures in 2015 Revenue 2,443 EUR million Personnel 17,321 (average) Order backlog 1,461 EUR million EBITDA 91.5 EUR million (3.7% of revenue) Free cash flow 53.9 EUR million 4

5 Megatrends supporting demand for our business Increasing technology Improving energy efficiency Growing digitalisation Urbanisation continues Technology in buildings currently account for 40 60% of building costs. Integrated technologies require multi-discipline expertise. Maintenance is increasingly based on preventive measures as well as on actual needs and conditions. Tightening legislation relating to energy efficiency Integrated technologies require multi-discipline expertise. Increasing demand for energy-efficient solutions also for existing buildings º All technologies in buildings have an IP address. º Demand for remote monitoring is increasing. º 10,000 buildings currently under s remote control. Needs for necessary infrastructure (water, sanitation, energy, information, transportation) increase. Urban development management important (manage of land, housing, working environment, transportation)

6 Strategy to address megatrends 6

7 Business areas Technical Installation & Maintenance Large Projects Managed Services º Small and mid size projects and maintenance agreements º Single and multiple technologies º Over 30,000 contracts in this area º Contract volume > EUR 5m º Integrated solutions º Customisation º Life Cycle focus º is running some 50 projects of this type. º At its widest form delivered as Managed Life Cycle Solutions. º Services can be executed either by or third parties. º In total some 100 contracts in this area. Number of competitors Barriers of entry, complexity, margin potential, risk level Pie charts: Estimated share of Group revenue in

8 A fully industrialised and unique market offering A fundament for development of the business mix Life Cycle Solutions Advisory Services Design & Engineering Services Project Management Project Execution Technical Maintenance Managed Services Public Commercial view for each service area Industry Real estate owners and developers Real estate users Value proposition for each client segment General contractors 8

9 Market overview

10 We have strong growth potential in the fragmented market Main competitors by country/division Finland o Are, Imtech Nordic, Consti Sweden o Bravida, Imtech Nordic, Midroc Electro AB Norway o Gunnar Karlsen, Bravida, Oras Denmark o Kemp & Lauritzen, Wicotec Kirkebjerk, Bravida Germany o Bilfinger Facility Services, ROM Technik, Strabag PFS Austria o Ortner, EQOS Energie, Cofely Industry o Maintpartner, BIS Production Partner (Bilfinger Industrial Services), Empower Strong market position in all key operating countries Revenue breakdown 1-3/2016 Technical Installation and and Maintenance 67% Large Projects 20% Managed Services 13% 10

11 Market outlook for s business in 2016 Technical Installation and Maintenance o o o Market is expected to remain stable. Requirements for increased energy efficiency, better indoor conditions and tightening environmental legislation support market development. In Norway general economy impacted by slowdown in the oil industry. Large Projects o o o Positive signs both in received orders and tendering activity. In certain industries (nuclear in Germany and Sweden, mining in Sweden and oil in Norway) less investments resulting in project postponements or cancellations. Demand for design & build of Total Technical Solutions expected to develop favourably. Managed Services o Need for new services and the demand for life cycle solutions are expected to increase. o Clients focus on their core operations opens opportunities in outsourced operation and maintenance mainly for public authorities, industries and utilities. 11

12 Financials

13 Strong financial position supporting strategy execution 1. On track to reach our financial targets 2. Our financial position is strong allowing us to execute our strategy. 3. Focused on delivering profitable growth by changing the business mix and cost efficiency 13

14 Outlook for 2016 and financial targets 2015 (actual) º Revenue growth: 2% º EBITDA margin: 3.7% º Working capital: EUR m Outlook 2016* º Revenue: estimated to remain at the previous year's level (2015: EUR 2,443 million). º EBITDA: estimated to grow from the previous year (2015: EUR 91.5 million). End of 2016 target º Revenue growth: average annual growth > 10% º EBITDA margin: > 6% º Working capital: negative Key actions supporting achievement of our financial targets Revenue º Strong focus on Managed Services with a higher growth profile and Large Projects with total technical solutions and a higher design content *Revised April 27, Profitability º Strong focus in business mix towards growth areas (Managed Services and Large Projects) with higher margin potential º Increasing procurement and administrative efficiency Working capital º Focus on efficient invoicing and working capital management º Provides flexibility to manage the other two financial targets 14

15 Strong order backlog development in Q1 Order backlog EUR million Q1 Q2 Q3 Q4 +14% 1,589 Order backlog grew by 14% compared to the previous year (by 15% at comparable exchange rates). The order backlog continued to increase reflecting the growth targets in Large Projects and Managed Services. Comparative figures are carve-out figures for the periods before the effective date of the partial demerger (June 30, 2013)., 15

16 Revenue unchanged year-on-year Group revenue EUR million 1 12/14: 2, /15: 2, /14 4 6/14 7 9/ /14 1 3/15 4 6/15 7 9/ /15 1 3/ Revenue remained on par with the previous year and was EUR 561 million in January March. The revenue growth was largest in Germany, Industrial Solutions and Eastern Europe compared to the previous year. Revenue breakdown by division EUR million (11%) (-4%) (-16%) (9%) (7%) (-8%) (17%) In Denmark-Norway, the revenue is impacted by the general economic environment in Norway. Lower than expected utilisation rate in Sweden. Germany Sweden Denmark-Norway Industrial Solutions 1 3/15 1 3/16 Finland Austria Eastern Europe 16

17 Operating environment by business area (Q1/2016) Revenue by business area 1 3/2016 Large Projects (20%) Managed Services (13%) Technical Installation and Maintenance (67%) Technical Installation and Maintenance o The market was weaker than expected. o In Norway, the business was impacted by slowdown in the oil industry. o Lower than expected utilisation rate in Sweden. Large Projects o In general good development with new clients and contracts. o A tough pricing environment prevailed but was able to maintain its price levels with focus on quality and execution. o In Norway and Austria there have been postponements in new investments. Managed Services o Demand remained strong. o Interest in PPP s and other Life Cycle Solutions increasing while they still represent only a marginal part of the entire market. 17

18 Profitability affected by low utilisation in Technical Installation and Maintenance EBITDA, EUR million EBITDA margin, % 1 12/14: 67.5 (2.8%) 1 12/15: 91.5 (3.7%) 34,3 34,0 21,5 5,2 22,0 21,3 5,1 3,8 14,2 3,4 3, ,6 2,1 2,5 1, ,4 1 3/14 4 6/14 7 9/ /14 1 3/15 4 6/15 7 9/ /15 1 3/16 o The EBITDA decreased from the previous year and amounted to EUR 11.5 million, or 2.0 percent of revenue. o Affected by a lower than planned utilisation rate in Technical Installation and Maintenance units. o EBITDA negatively affected by restructuring expenses (EUR 2.0 million) and German legal expenses. o Investments in common processes also reflected in operational expenses. 18

19 Increasing procurement and administrative efficiency is key for margin improvement Revenue to EBITDA waterfall 2015 (EURm) (%) of total cost base of EUR 2,355m (42%) 427 (18%) 671 (29%) 278 (12%) 91,5 Personnel expenses accounted for 42% of total cost base in Administrative (15%) Variable (85%) Sourced materials and supplies and external services accounted for 47% total cost base in Procurement expenses amounted to EUR 1.4bn in 2015 (58% of the total cost base). Revenue Personnel expenses External services Materials Other items and supplies (net)* EBITDA (% of cost base before EBITDA) *) Incl. other operating expenses, change in inventories of finished goods and work in progress and production for own use. 19

20 Financial target: negative working capital Working capital % 5% 46 3% % 2% 2% Working capital, EUR million Working capital to sales, % (LTM) Q1: Working capital affected by the technical completion of projects with related legal disputes and building up of material inventory in Large Projects in Industrial Solutions. 8 1% 1% % -1% 0% -14-1% 6/13 9/13 12/13 3/14 6/14 9/14 12/14 3/15 6/15 9/15 12/15 3/16 20

21 Free cash flow Free cash flow EUR million 108,7 76,5 FCF, Rolling 12 months 62,1 90,6 100,3 87,6 79,2 95,7 96,5 67,8 73,6 53,9 º Free cash flow = Operating cash flow before financial and tax items Taxes paid Net cash used in investing activities (net, including acquisitions and disposals). 14,4 24,3 0,8-15,8-7,1-6,3-14,2-28, /13 1 3/14 4 6/14 7 9/ /14 1 3/15 4 6/15 7 9/ /15 1 3/16 Development and investment o Continuous development and investment in technologies, processes and competences o Low level of capex investments (incl. acquisitions) of EUR 7.1 million in January- March 2016 and EUR 26.9 million in 2015, mainly relating to IT and the development of common business processes. 21

22 Strong balance sheet and liquidity Net debt, EUR million Net debt/ebitda, Rolling 12 Months o Net debt remains in Q level 3.3x 3.4x x x x 2.3x x 0.7x 0.9x 1.1x x 0.7x o Strong cash position enabled voluntary repayment of gross debt by EUR 20 million Q2/13 Q3/13 Q4/13 Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 Q3/15 Q4/15 Q1/16 Gross debt to net debt EUR million Liquidity reserve EUR 158 million EUR million Unused credit facilities 75 Long-term borrowings Short-term borrowings Cash and cash equivalents Net debt 39 Cash and cash equivalents 22

23 Dividend policy Dividend pay-out at least 50% of the net profit for the period. A dividend of EUR 0.28 per share was paid on April 4, representing 75% of the Group s net profit for Q1: Earnings per share Earnings per share amounted to 0.03 (0.04) euros per share in January March. Dividend per share, EUR Dividend pay-out ratio, % 78% 0,22 0,22 100% 75% 0,