Analyst Conference Drägerwerk AG & Co. KGaA. March 7 th 2019

Transcription

1 Analyst Conference Drägerwerk AG & Co. KGaA March 7 th 2019

2 Disclaimer This presentation does not constitute an offer of securities for sale or a solicitation of an offer to purchase any securities. No money, securities or other consideration is being solicited by this presentation. This presentation contains forward-looking statements regarding the future development of the Dräger Group. These forward-looking statements are based on the current expectations, presumptions, and forecasts of the Executive Board as well as the information available to it to date, and have been made to the best of its knowledge and belief. No guarantee or liability for the occurrence of the future developments and results specified can be assumed in respect of such forward-looking statements. Rather, the future developments and results are dependent on a number of factors; they entail risks and uncertainties beyond our control and are based on assumptions which could prove to be incorrect. Notwithstanding any legal requirements to adjust forecasts, we assume no obligation to update the forward-looking statements contained in this presentation. Interim financial reports as well as preliminaries are not audited. 2

3 OVERVIEW Fiscal Year

4 Net sales growth and EBIT improvement Business development Dräger Group Net Sales (in EUR million) 2, % FX adjusted +0.9% Nominal , Q1 Q2 Q3 Q EBIT (in EUR million) 6.1% Margin % Margin Q1 Q2 Q3 Q Highlights Order intake +6.0% cc. Strong year-end business. Gross profit margin declined to 42.7% (PY 44.8%). Functional expenses increased due to investment program and additional unplanned cost. FY EBIT-margin declined to 2.4%. Full-year FX impact negative on net sales and EBIT. (FY FX: Net sales -3pp, EBIT margin ~ -1pp) DVA declined to EUR 26.5m (PY EUR 70.7m). 4

5 Positive order intake in all regions Order development Dräger Group Order entry (in EUR million) Group Medical Safety Net Sales America % +8.0% +15.4% +4.4% Africa, Asia, Australia % +12.4% +9.6% +6.1% Europe 1, % +1.1% +3.2% +2.8% Group 2, % +5.7% +6.5% +3.9% Growth rates are net of currency effects 5

6 Investmentplan for future growth Achievements 2018 and priorities 2019 What we have achieved New hub in Krefeld for supporting Dräger rental safety services. Strengthened Sales & Service resources and global Key account management. Strengthen Gas Detection System Centers. First large product launch of the roadmap to renew medical product portfolio on track. Pilot for the digital distribution sales channel up and running Priorities 2019 Roadmap to renew medical product portfolio. Continue to focus on reducing time to market. Improve quality management process and set-up. Optimize logistic process and set-up. Implementation of go-to-market strategies, i.e. investing in North American Safety business. Strengthen organizational focus on medical and safety

7 Strengthening organizational focus on medical and safety What we are changing Organizational set-up and business steering according to medical and safety: Introduction of business units with full product and customer accountability. Business units are combined to a medical division and a safety division, each managed by a dedicated board member. Financial reporting according to the new divisional structure. (as of FY 2020) One dedicated board member responsible for the global sales organization. We are NOT stopping to share resources across business units. What we will achieve Stronger customer focus in headquarter functions. Strengthening focus on customer needs also in non-customer facing functions, e.g. throughout the entire innovation process and roadmap management. Business Units have the freedom to operate where diversity is beneficial to customers. Strong focus on growth and profitability of both business divisions at the same time. Maintaining efficiency in shared resources systems and processes across business units. Implementation during

8 Changes in board responsibilities 2019 As of January 1, 2020 Toni Schrofner Reorganization Medical Innovation Executive Board member for medical division Rainer Klug Dr. Reiner Piske Reorganisation Safety Region Americas Quality, Purchasing, Production & Logistics Region Europe Region AAA Human Resources Executive Board member for safety division Executive Board member for global sales Financial reporting for FY 2020 will be according to medical and safety (primary view) and regions (secondary view) 8

9 FINANCIALS Fiscal Year

10 Business development Dräger Group Net Sales Comments EBIT 835, % FX adjusted +3.7% Nominal 865,9 Q4 17 Q % EBITmargin FX adjusted 2.572,3 +0.9% 2.595,0 Nominal FY17 155,7 +3.9% -8% -60% 12.0% EBITmargin 6.1% EBITmargin FY18 2.4% EBITmargin 62,6 Order intake (FX adjusted) Q4 FY Medical +13.9% +5.7% Safety +8.6% +6.5% Group +11.9% +6.0% Orders on hand ~+25% (cc) 12M Gross profit margin 42.7% (py 44.8%) 12M Functional Expenses yoy +7.0% (cc) 12M other fin.& invest. result -3.4m (py -4.7m) EBIT-margin incl. ~ -1 pp from FX DVA -26.5m (py 70.7m) Q4 17 Q4 18 FY17 FY18 10

11 Region Americas Financial performance Order Entry EBIT 509 FX adjusted +3.3% 526 Nominal % EBITmargin % >-100% -6.0% EBITmargin Net Sales +4.4% 510 FX adjusted -2.2% 499 Nominal Comments Order intake: Q4 FY Medical +25.2% +8.0% Safety +35.1% +15.4% Americas +28.1% +10.2% Solid FY Order and net sales growth in Central-, South- America. North America order growth also strong but slight decline in net sales. Gross profit margin: -3.8pp yoy Functional expenses (FX adjusted): FY +8.1% yoy DVA EUR -51.6m (PY EUR -16.6m) 11

12 Region Europe Financial performance Order Entry EBIT 1, % 1,450 Nominal % EBITmargin +1.9% FX adjusted -24% 5.7% EBITmargin Net Sales +2.8% FX adjusted 1, % Nominal 1, Comments Order intake: Q4 FY Medical +2.3% +1.1% Safety +3.7% +3.2% Europe +2.9% +1.9% Good top line growth in Germany with mixed performance in other European countries. Gross profit margin: -1.1pp yoy Functional expenses (FX adjusted): FY +4.5% yoy DVA EUR 41.4m (PY EUR 68.8m)

13 Region Africa, Asia, Australia Financial performance Order Enty Net Sales Comments % FX adjusted +8.0% Nominal % FX adjusted % 664 Nominal Order intake: Q4 FY Medical +30.1% +12.4% Safety +4.7% +9.6% AAA +21.4% +11.6% EBIT % EBITmargin % 1.6% EBITmargin Strong order growth in all sub- Regions. Sales development also strong in all sub-regions except India and MEA which decline slightly. Gross profit margin: -2.9pp yoy Functional expenses (FX adjusted): FY +10.3% yoy DVA EUR -16.3m (PY EUR 18.5m) 13

14 Functional Expenses Dräger Group 12M M 2018 Change Change net of FX million million % % R&D % of Net Sales -9.1% -9.7% Sales & Marketing % of Net Sales -22.0% -22.8% Administration % of Net Sales -7.7% -7.6% SG&A % of Net Sales -29.7% -30.5% Functional Expenses total , % of Net Sales -38.6% -40.2% Headcount 1 13,739 14, Values as of reporting date 14

15 Key Figures Dräger Group 12M M 2018 Change million million Cashflow from operating activities Investments % Cash and cash equivalents Net financial debt >100 Net financial debt 1 /EBITDA Capital employed 1 1, , ROCE (EBIT 2 /Capital employed 1 ) 12.5% 4.7% Net Working Capital Equity ratio pp EPS per common shares (on full distribution) EPS per preferred shares (on full distribution) Values as of reporting date 2 EBITDA and accordingly EBIT of the last twelve months 15

16 OUTLOOK Fiscal Year

17 Dividend proposal for FY (in EUR million) 2018 (in EUR million) Net profit * Dividend Participation certificates ** Common shares Preferred shares Net payout ratio 11.6% 12.6% Dividend per common share preferred share Dividend policy Dräger plans to distribute at least 10% of group net profit (less earnings attributable to non-controlling interests) to the company s shareholders and participation certificate holders. * after earnings attributable to non-controlling interests ** Without minimum dividend, after taxes 17

18 Outlook FY 2019 Net Sales (net of currency effects) 2018 guidance e 2.0 % 5.0 % 3.9 % 1.0 % 4.0 % EBIT margin 2.0 % 3.5 % 2.4 % 1.0 % 3.0 % 2 Gross profit margin % 42.7 % +/- 1 pp Dräger Value Added EUR -40m to 0m EUR -26.5m EUR -60 to -10m Assumptions for FY 2019 Guidance Increasing economic uncertainties will slightly slow down demand. Improving net sales development in North America will partly be off-set by softer demand in Central- / South America. Growth in the Europe Region expected to be slightly softer. Continuously strong top-line development in AAA Region. Positive growth in both product areas, with a stronger top-line growth for safety offerings. Higher functional expenses due to investments to support future growth. Increase of R&D budget to EUR million. No meaningful FX impact on nominal net sales growth and EBIT-margin 2 1 last published guidance 2 based on exchange rates at the start of the year 2019 and without restructuring charges 18

19 19 Questions & Answers

20 Guidance 2018 / 2019 Net sales e 3.9% % (net of currency effects) (net of currency effects) EBIT margin 2.4% % 1 Dräger Value Added EUR million in the range EUR -60 to -10 million Other forecast figures: Gross margin 42.7 % on prior year's level (+ / - 1pp) Research and development costs EUR million EUR million Interest result EUR million on prior year's level Days working capital (DWC) days stable Investment volume EUR 77.8 million 2 EUR million 2 Net financial debt EUR million improvement 1 Based on exchange rates at the start of the year 2019 and excluding restructuring charges 2 excluding company acquisitions 3 The calculation method will be adjusted during

21 Business Development Segments 5y view SEGMENT EUROPE Order Entry 1 million 1, , , , ,450.2 Net Sales 1 million 1, , , , ,431.9 EBIT million EBIT margin % SEGMENT AMERICA Order Entry 1 million Net Sales 1 million EBIT million EBIT margin % SEGMENT AFRICA, ASIA, AUSTRALIA Order Entry 1 million Net Sales 1 million EBIT million EBIT margin % year 2014 were adjusted pro-forma due to the change in segment reporting. 21 For further analysis, this data (including quarterly figures) can be downloaded as an Excel file from the Dräger website

22 Business development Q4 Segments Europe Americas Africa, Asia, Australia Dräger Group Q Q Q Q Q Q Q Q million million million million million million million million Order entry Net Sales EBITDA EBIT EBIT-margin Capital Employed , ,344.7 ROCE 1, DVA Values at due date 2 EBIT of the last twelve months 22

23 Business development 12M Segments Europe Americas Africa, Asia, Australia Dräger Group 12M M M M M M M M 2018 million million million million million million million million Order entry 1, , , ,686.5 Net Sales 1, , , ,595.0 EBITDA EBIT EBIT-margin Capital Employed , ,344.7 ROCE 1, DVA Values at due date 2 EBIT of the last twelve months 23

24 Business Development medical and safety products 5y view Medical Order Entry million 1, , , , ,723.4 Net Sales million 1, , , , ,643.0 EBIT million EBIT margin % Safety Order Entry million Net Sales million EBIT million EBIT margin % For further analysis, this data (including quarterly figures) can be downloaded as an Excel file from the Dräger website 24

25 Business development Medical Q Q Change Change 12M M 2018 Change Change million million % % (FX adj.) million million % % (FX adj.) Order entry , , Europe America Africa, Asia, Australia Net Sales , , Europe America Africa, Asia, Australia EBIT EBIT-margin (%)

26 Business development Safety Q Q Change Change 12M M 2018 Change Change million million % % (FX adj.) million million % % (FX adj.) Order entry Europe America Africa, Asia, Australia Net Sales Europe America Africa, Asia, Australia EBIT EBIT-margin (%)

27 Functional expenses 5y view Change million million million million million % R&D % of Net Sales SG&A -8.7% % % % % % of Net Sales Other operating income Functional Expenses total -30.8% % , % % % 1.0-1, % of Net Sales Headcount % 13, % 13, % 13, % 13, % 14, Values as of reporting date 27

28 Cash-flow statement Change million million million million million % Group net profit Change in inventories >-100 Change in receivables Change in payables >-100 Depreciation and amortizatio Other operating cash flow ite >100 Operating cash flow Investing cash flow Free cash flow >-100 Financing cash flow Change in cash >-100 Cash and cash equivalents Change in cash and cash equivalents, i.e. without any effect of exchange rates 2 Values as of reporting date 28

29 Consolidated balance sheet 31 Dec Dec 2018 Change million million % Intangible Assets Property, plant and equipment Other noncurrent assets Noncurrent assets Inventories Trade receivables Other current assets Cash and cash equivalents Current assets 1, , Total assets 2, ,

30 Consolidated balance sheet 31 Dec Dec 2018 Change million million % Equity 1, , Liabilities from participation certificates Provisions for pensions and similar obl Noncurrent interest bearing loans Other noncurrent liabilities Noncurrent liabilities Current Provisions Current loans and liabilities to banks Trade payables Other current liabilities Current liabilities Total equity and liabilities 2, ,

31 Earnings per share Net profit (less the share of earnings attributable to non-controlling interests) '000 81,391 98,530 34,355 Scenario: 100% pay-out ratio 100% 100% 100% = tax benefit from pay-out to PCs* '000 7,888 9,493 3,302 Earnings attrib. to shares and PCs (incl. tax benefit) '000 89, ,023 37, % Earnings attributable to PCs** '000 28,425 34,420 11,973 32% Earnings attributable to shares '000 60,855 73,603 25,685 68% EPS (common share) EPS (preferred share) Scenario: actual/proposed pay-out ratio 5.3% 11.6% 12.7% tax benefit from pay-out to PCs* ' Earnings attrib. to shares and PCs (incl. tax benefit) '000 81,732 99,490 34, % Earnings attributable to PCs** '000 1,236 3,482 1,236 4% Earnings attributable to shares '000 80,496 96,008 33,460 96% EPS (common share)*** EPS (preferred share)*** * tax benefit arises from the tax deductible pay-out to the PCs; please refer to Annual Report 2017, note 19 ** without minimum dividend (as interest, the minimum dividend is already included in net earnings) ** the EPS is not calculated in accordance with IAS 33 PCs = participation certificates (Genussscheine) 31

32 Innovation rate Share on new products and upgrades medical 1 45% 40% Net sales Upgrades New products 35% 30% 25% 20% 15% 10% 34% 28% 32% 22% 27% 20% 20% 18% 26% 22% 31% 25% 5% 0% 6% % % % % % Launched in the last 3 years; products are regarded as new, if they enable Dräger to either enter a new market segment or if products are regarded as completely new according to Dräger s customers and Dräger s sales force. Upgrades are those products, which serve existing Dräger markets, but their functionality is perceived as significantly enhanced by Dräger s customers and Dräger s sales force. 32

33 Financial calendar 2019 March 7, Final 2018 figures Conference call April 25, Report for the first three months 2019 Conference call May 10, Annual shareholders' meeting, Lübeck, Germany August 8, Report for the first six months 2019 Conference call October 30, Report for the first nine months 2019 Conference call 33

34 Contact Melanie Kamann Corporate Communications Thomas Fischler Investor Relations Drägerwerk AG & Co. KGaA Drägerwerk AG & Co. KGaA Moislinger Allee Moislinger Allee Lübeck, Germany Lübeck, Germany Tel Tel Fax Fax Mobile Mobile