Q1 FY14 Management Presentation

Transcription

1 FY14 Management Presentation (preliminary figures) Solid start into FY14 OSRAM Licht AG January 29, 2014

2 Safe Harbor Statement This presentation may contain forward-looking statements that are subject to risks and uncertainties, including those pertaining to the anticipated benefits to be realized from the proposals described herein. Forward-looking statements may include, in particular, statements about future events, future financial performance, plans, strategies, expectations, prospects, competitive environment, regulation and supply and demand. OSRAM Licht AG has based these forward-looking Statements on its views and assumptions with respect to future events and financial performance. Actual financial performance could differ materially from that projected in the forward-looking Statements due to the inherent uncertainty of estimates, forecasts and projections, and financial performance may be better or worse than anticipated. Given these uncertainties, readers should not put undue reliance on any forward-looking statements. The information contained in this presentation is subject to change without notice and OSRAM Licht AG does not undertake any duty to update the forwardlooking statements, and the estimates and assumptions associated with them, except to the extent required by applicable laws and regulations. Due to rounding, numbers presented throughout this and other documents may not add up precisely to the totals provided and percentages may not precisely reflect the absolute figures. 2

3 Group highlights FY14 Continued focus on profitable growth 1,326m revenue (+2% comp.) 9.3% Adj. EBITA-margin 1) (+140bps y-o-y) OSRAM Push continues to deliver on plan 105m benefits OSRAM drives further expansion of SSL share 33% SSL revenue share (vs. 26% in ) Outlook FY14 confirmed 1) Adjusted for Special items - "Special items in this context include certain items, e.g. (personnel) restructuring costs, that will also occur in future periods 3

4 Segment highlights FY14 Specialty Lighting (SP) Growth in automotive outperforms global car production growth (light vehicles) since 16 quarters Introduced phaser module for laser-based projection in Display / Optics Opto Semiconductors (OS) Significant revenue growth and margin expansion y-o-y Construction of back-end facility Wuxi finalized, equipment roll-in in plan Start of 6 inch wafer production for red and yellow LEDs Lamps & Components (LC) Focus on margin quality: +220bps adj. EBITA margin improvement y-o-y Strong SSL growth with LED lamps, light engines and drivers Luminaires & Solutions (LS) Transformation of LS business in execution; restructuring of Services in North America timely ahead of plan More than 40% of our Luminaires business is already SSL based 4

5 OSRAM Push continues to deliver in plan OSRAM Push: Overall, comprehensive, sustainable performance improvement program Structure Growth Operation Culture EBITA Margin: >8% as average over the cycle OSRAM Push execution track record Transformation costs ( m) (FY12 14) Plant reductions (FY12 14) Headcount reduction ( 000) (FY12 14) OSRAM Push gross savings, cum. ( m) ( 15) As of FY14 Progress Target % % 6.6 3) 0.6 c % % c.1,200 OSRAM Push targets: Cum. gross savings of 1.2bn by FY15 unchanged Headcount reduction of 8,700 by FY14 unchanged Reduction of manufacturing sites unchanged OPEX targets unchanged: SG&A 1) : Reduce by ~8-10% by FY14 vs. FY12 R&D: Keep absolute terms flat until FY14 vs. FY12 1) w/o logistics costs 2) FY data as of Sep. 30th, as of Dec 31st, data in thousands Overview headcount development 2) OSRAM Group Segment OS FY11 FY ) Including impact of Tangerang (closure of production) Cum. Q4/ FY FY14 5

6 Equipment roll in at Wuxi plant 1972: First assembly line for LEDs in Regensburg 2001: Groundbreaking of new LED Front-end facility in Regensburg 2012: Groundbreaking of 2 nd Back-end facility in Wuxi 1978: LED Back-end facility in Malaysia 2009: Setup of LED chip production site in Malaysia Project New Back-end facility Packaging of visible & IR LED chips R&D center for advanced packaging Sales and Marketing Application Centers Improve access to the Asia and Chinese lighting market Take part in government programs Create up to 2,150 jobs until 2017 Major Milestones May 2012 Aug 2012 Oct 2012 FY14 Q3 FY14 Signing Investment contract with Wuxi New District Ground breaking ceremony Start civil works (after piling completed) Equipment roll in Expected start of production 6

7 Top-line growth following strong finish in Group ( m) Revenue development Comments y-o-y Quarterly revenue Revenue (in m) Comp. growth (%) 1,357 1,322 Q2 1,278 1, , Growth (%) (1) (3) (2) (3) (2) Revenue by Segment 1) Opto Semiconductors nom. 17% comp. 20% 19% Specialty Lighting 26% nom. 5% comp. 9% (1) Comparable growth of 2%, held back by strong fiscal year-end finish Reported revenue held back by negative currency translation effects Transformation to SSL gains pace with +28% comparable growth of SSL revenue; total SSL share at 33%, up from 26% y-o-y 0 APAC and EMEA: comp. growth mainly driven by OS and SP Q3 Q4 Americas: growth of most segments held FY14 back by declining services business 9% 45% Luminaires & Solutions Lamps & Components nom. (7%) comp. (2)% nom. (9)% comp. (6)% Revenue by Region 1) Americas nom. (6%) comp. 0% EMEA 1) Based on sum of Segments revenue, w/o considering corp. items & consolidation; nom. (nominal growth) / comp. (comparable growth, adjusted for FX and portfolio effects) 31% APAC 23% 45% nom. (2%) comp. 4% nom. 0% comp. 3% 7

8 Broad based profitability increase Group ( m) EBITA development Comments y-o-y Adj. EBITA Margin 1) (%) EBITA Margin (%) Adj. EBITA margin increased to 9.3% (+140 bps), mainly supported by OSRAM Push and higher capacity utilization primarily at OS 1.7 Continued gross margin improvement in SSL forward (1.8) 112 Special items nearly level with and impacted reported EBITA with 11m Profit before tax up 26.1% y-o-y; strong net income at 68.1m on prior year level EBITA ( m) 1 Q2 22 Q3-24 Q4 FY14 Special items 2) Q2 Q3 Q4 FY EBITA reported (24) therein: OSRAM Push transformation costs incl. personnel restructuring (36) (90) (64) (110) (300) (10) Total Special items (7) (98) (72) (133) (310) (11) 1) Adjusted for Special items 2) "Special items in this context include certain items, e.g. (personnel) restructuring costs, that will also occur in future periods 8

9 Lamps & Components: Strong profitability increase due to OSRAM Push benefits Revenue and EBITA margin development Comments y-o-y Adj. EBITA Margin 1) (%) EBITA Margin (%) Revenue ( m) (2.4) (1.3) (4.8) Strong finish of results in a modest decrease of revenue in FY14 Successful launch of LEDr Classic family led to sharp increase of SSL revenues Strong margin following weak profitability in Q4 2013, on the back of OSRAM Push as well as cost discipline; prior year quarter impacted by higher inventory write-downs Higher transformation costs expected in coming quarters Comp. growth (%) (3) (2) Q2 Q3 Q4 FY14 Growth (%) (5) (7) (7) (8) (7) (1) 2 (2) Special items 2) FY14 EBITA reported 2 40 therein: Total Special items (29) (3) 1) Adjusted for Special Items 2) "Special items in this context include certain items, e.g. (personnel) restructuring costs, that will also occur in future periods 3) Growth rates FY12 not available (due to change in segment structure as of ) 9

10 Luminaires & Solutions: Transformation in execution Revenue and EBITA margin development Comments y-o-y Adj. EBITA Margin 1) (%) EBITA Margin (%) (9.1) (6.7) (8.0) (11.5) (16.5) (15.1) (11.2) (18.2) (18.0) Comparable revenue decline of 6%, mainly due to exit of traditional maintenance business and product portfolio pruning at luminaires (41.7) Slightly improved profitability despite expected top-line decline Revenue ( m) Comp. 4 growth (%) (14) (8) (6) (6) Q2 Q3 Q4 FY14 Growth (%) (12) (8) (7) 1 (9) Special items 2) 1) Adjusted for Special Items 2) "Special items in this context include certain items, e.g. (personnel) restructuring costs, that will also occur in future periods FY14 EBITA reported (17) (15) therein: Total Special items (4) (4) 10

11 Specialty Lighting: Top-line growth and high profitability Revenue and EBITA margin development Comments y-o-y Adj. EBITA Margin 1) (%) EBITA Margin (%) 19.9 Clear revenue growth of 9% on a comparable 19.1 basis Automotive with double-digit comparable growth, driven by SSL business and benefitting from shorter plant holidays APAC and EMEA showing significant comparable growth rates, stable development in Americas with modest growth Revenue ( m) Comp. growth (%) 6 3 Q2 Q3 Q4 FY14 Growth (%) Strong 16.0% EBITA margin, however below exceptional prior year quarter mainly due to higher SSL share Special items 2) FY14 EBITA reported therein: Total Special items (3) (2) 1) Adjusted for Special items 2) "Special items in this context include certain items, e.g. (personnel) restructuring costs, that will also occur in future periods 11

12 Opto Semiconductors: Extraordinary top-line growth combined with operational performance Revenue and EBITA margin development Comments y-o-y EBITA Margin (%) Revenue growth of 20% on a comparable basis, all regions above prior year level; current quarter benefiting from shorter plant holidays in the automotive industry Reported EBITA of 35.7m includes net expenses of 8.1m related to legal matters and a license agreement Revenue ( m) Comp. growth (%) Favorable portfolio mix and improved capacity utilization keep EBITA margin on high level Q2 Q3 Q4 FY14 Growth (%)

13 Continued increase in net liquidity due to strong FCF Group ( m) Capital Expenditure Net Debt bridge -18% SP OS 7 7 L&C 15 L&S Other Capex as % of revenue Net EBITDA Liquidity 43 NWC 4 FCF 72 noncurrent assets and liabilities 11 Mainly taxes paid 3 Other income / expense 33 CAPEX Other Net Invest./ Liquidity Fin. FY14 activities Working Capital Free Cash Flow Group WC Inventories 1,254 1, , % 72 Trade receivables 822 Trade payables -576 Turns 1) FY FY14 1) Defined as revenue (last twelve months) divided by working capital 13

14 Key financial metrics Group ( m) FY14 Change (y-o-y) Revenue 1,357 1,326 Nom: (2)% Comp: 2% Gross Margin 30.1% 32.4% 230bps R&D (88) (81) 7 SG&A (262) (238) 24 EBITA EBITA Margin 7.4% 8.5% 110bps Adj. EBITA Adj. EBITA Margin 7.9% 9.3% 140bps Financial result (incl. at-equity results) (19) (8) 11 Income before Taxes Taxes (9) (29) (20) Net Income Basic EPS (in ) Free Cash Flow (18) CAPEX (40) (33) 7 Employees (in thousands) (4) Net Liquidity 246 Adj. Net Debt / EBITDA 0.1 Equity Ratio 51% 14

15 Outlook confirmed 1 2 Comp. revenue growth FY14 expected to exceed global real GDP growth, currently estimated at approximately 3% for ) Despite the initiated restructuring within LS We expect an adjusted 2) EBITA margin of more than 8% in FY Cumulated gross cost savings of ~ 1.2bn until FY15 OPEX targets remain unchanged Transformation costs for FY14 expected to approach 100m Net income for FY14 expected to rise sharply ROCE for FY14 expected to exceed cost of capital of 8.5% Free Cash Flow for FY14 expected to come in with a positive triple-digit m amount, however below the high level Higher cash-out for transformation costs and CAPEX 1) Based on IHS Global Insight 2) Excl. impact from transformation costs, spin-off- / stand alone-related costs and substantial legal and regulatory matters 15

16 OSRAM s transformation path Structure / People / Processes 2011 Focus / Prioritize 2012 Transform / Execute 2013 Transform / Execute 2014 Deliver 2015 >8% EBITA as Ø over the cycle Continuous improvement process is part of OSRAM s DNA : Equipment roll in at Wuxi plant (OS backend facility) Q2: New SSL products driving top-line growth Q3: Repositioning of LS shows first effects Q4: Transformation becomes part of operational business ( all in ) : Top-line and bottom-line on plan Q2: Top-line bottomed out Q3: Back to profitable growth Q4: Majority of restructuring done Apr: New board members Jul: Start of restructuring Jul: Restructuring progress, further consolidation of manufacturing footprint and OPEX program started 16

17 Financial Calendar and Investor contacts Upcoming events January 30/31, 2014; February 5/ Roadshow February 4, 2014 HSBC SRI Konferenz, Frankfurt February 27, 2014 Annual General Meeting, Munich April 1, 2014 Capital Market Day at the L+B fair, Frankfurt April 30, 2014 Q2 preliminary figures Investor Relations contact Mr. Boris Tramm Munich Office Internet ir@osram.com 17

18 Disclaimer This presentation contains certain non-ifrs measures. FCF, EBITDA, EBITA, EBIT, EBITA margin, capital expenditures, capital expenditures as percentage of revenues and other operating income, net financial debt, net working capital and certain other items included herein are not recognized measures in accordance with IFRS and should not be considered as an alternative to the applicable IFRS measures. We have provided these measures and other information in this presentation because we believe they provide investors with additional information to measure our performance. Our use of the terms FCF, EBITDA, EBITA, EBIT, EBITA margin, capital expenditures, capital expenditures as percentage of revenues and other operating income, net financial debt, net working capital varies from others in our industry and should not be considered as an alternative to net income (loss), cash flows from operating activities, revenues or any other performance measures derived in accordance with IFRS as measures of operating performance or to cash flows as measures of liquidity. FCF, EBITDA, EBITA, EBIT, EBITA margin, capital expenditures, capital expenditures as percentage of revenues and other operating income, net financial debt and net working capital have important limitations as analytical tools and should not be considered in isolation or as substitutes for analysis of our results as reported under IFRS. Certain numerical data, financial information and market data (including percentages) in this presentation have been rounded according to established commercial standards. As a result, the aggregate amounts (sum totals or interim totals or differences or if numbers are put in relation) in this presentation may not correspond in all cases to the amounts contained in the underlying (unrounded) figures appearing in the consolidated financial statements. Furthermore, in tables and charts, these rounded figures may not add up exactly to the totals contained in the respective tables and charts. 18