Zumtobel Group AG. Q1 2014/15 results. September 2, Q1 2014/15 results

Transcription

1 Zumtobel Group AG Q1 2014/15 results September 2,

2 Restructuring measures on track, ongoing stabilisation of operating environment Financials Q1 2014/15 at a glance Group revenues increase by 4.6% year-on-year to EUR million driven by ongoing stabilization in European key markets and strong growth momentum with LED products (plus 56%) Execution of restructuring measures and transformation process is on track Adj. EBIT increases by 7.5% to EUR 19.1 million (Adj. EBIT margin 5.9%) due to improved profitability in both segments Net profit at EUR 5.7 million (PY 6.7 million) burdened by high negative special effects of EUR 10 million Outlook for FY 2014/15 confirmed approx. 3% increase in revenues and improvement of adjusted EBIT margin to 5% to 6%

3 Sound development of revenues and higher profitability Zumtobel Group Revenues and EBIT development Zumtobel Group Revenues Adjusted EBIT 1) +4.6% ,9% 5.7% % % 1.7% 5.5 Q1 Q2 Q3 Q4 Revenues 2013/14 In EUR million Q1 Q2 Q3 Q4 Adjusted EBIT 2013/14, Adjusted EBIT 2014/15 in EUR million Revenues FY 2013/14 EUR 1,246.8 million (plus 0.3%) Adjusted EBIT 2013/14 EUR 47.6 million (margin of 3.8%) Revenues FY 2013/14 EUR 1,246.8 million (plus 0.3%) Adjusted EBIT 2013/14 EUR 47.6 million (margin of 3.8%) 1) Reported EBIT adjusted for special effects Revenues 2014/15 In EUR million 0.0 Adjusted EBIT 2013/14, Adjusted EBIT 2014/15 as a % of revenues

4 LED share of group revenues increases to 43.1% (Q1 2013/14: 28.9%) Zumtobel Group LED revenue development Zumtobel Group LED revenues 56.0% LED revenues in Q1 2014/15 grow by 56% to EUR million Lighting Segment increases sales with LED products by 48.2% to EUR million (LED Penetration ~42%) LED sales in Components Segment rise by 76.8% to EUR 45.2 million (LED penetration ~47%) Q1 Q2 Q3 Q4 LED revenues 2013/14 In EUR million LED revenues 2014/15 In EUR million

5 Further stabilisation in late cyclical Lighting Segment with plus 5.9% in Q1 Lighting Segment Revenue and EBIT development Lighting Segment 5.9% Revenues 7,1% 6,5% Adjusted EBIT 1) 7.8% ,8% 1.0% Q1 Q2 Q3 Q4 Revenues 2013/14 In EUR million Revenues 2014/15 In EUR million Revenues FY 2013/14 EUR million (plus 0.3%) Q1 Q2 Q3 Q4 Adjusted EBIT 2013/14, Adjusted EBIT 2014/15 in EUR million Adjusted EBIT 2013/14, Adjusted EBIT 2014/15 as a % of revenues Adjusted EBIT 2013/14 EUR 38.3 million (margin of 4.1%) Adjusted EBIT 2013/14 EUR 38.3 million (margin of 4.1%) 1) Reported EBIT adjusted for special effects

6 Profitability above prior year despite lower revenues Components Segment Revenue and EBIT development Components Segment Revenues Adjusted EBIT 1) - 3.1% 7.8% % 7.5% 2.9% 8.8% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Revenues 2013/14 In EUR million Revenues FY 2013/14 EUR million (plus 1.8%) Adjusted EBIT 2013/14 EUR 25.1 million (margin of 6.5%) Adjusted Revenues EBIT FY 2013/14 EUR million million (margin (plus 1.8%) of 6.5%) Adjusted EBIT 2013/14 EUR 25.1 million (margin of 6.5%) 1) Reported EBIT adjusted for special effects Revenues 2014/15 In EUR million Adjusted EBIT 2013/14, Adjusted EBIT 2014/15 in EUR million Adjusted EBIT 2013/14, Adjusted EBIT 2014/15 as a % of revenues

7 Continuation of strong growth with LED-modules and converters Components Segment LED modules LED converters Revenues Revenues ~ 75% ~135% Q1 Q2 Q3 Q4 Revenues 2013/14 In EUR million Revenues 2014/15 In EUR million Q1 Q2 Q3 Q4 Revenues 2013/14 In EUR million Revenues 2014/15 In EUR million European market share of around 6% for LED Modules and around 11% (PY 6.5%) for LED converters

8 Successful transformation process: Encouraging growth in core business Components Segment revenue bridge Q1 2014/15 vs. Q1 2013/14 Components Segment Core Business: ca. plus 10% CS revenues Q1 2013/14 [in EUR million] Electronic Controls LED components Connection Magnetic ballasts Others CS revenues ballasts technology & wire Q1 2014/

9 Q1 revenue growth mainly driven by Germany and UK Zumtobel Group Regional revenue distribution Zumtobel Group Revenues in EUR million Q1 2014/15 Change in % D/A/CH Northern Europe Benelux & Eastern Europe Southern Europe & Latin America Northern America 2.9% Middle East & Africa Asia & Pacific Regional revenue distribution 11.5% 10.6% 28.5% D/A/CH Asia & Pacific Middle East & Africa* Northern America Total * incl. India, Central Asia & Turkey Southern Europe & Latin America 16.6% Benelux & Eastern Europe 8.4% 21.6% Northern Europe

10 Profitability in Q1 is driven by good top line momentum as expected structural cost improvements not yet visible in the P&L Zumtobel Group adj. EBIT Q1 2013/14 vs. Q1 2014/15 Revenue increase of EUR 14.2 Mio but gross margin 0,6 percentage point below Q1 PY. Margin burdened negative FX effects and temporary inefficiencies resulting form relocation of production Higher consultancy (plus 1.2 Mio EUR) and accruals related to changes in the management board ,1-0, Decrease in personnel expenses sales FTEs reduced by close to 150 FTEs over the last six month (not fully P&L effective yet) but higher expenses for marketing and transportation e.g. higher income under license agreements Adj. EBIT Q1 2013/14 Gross profit R&D Selling Administration Others Adj. EBIT (before R&D) Q1 2014/15 [in EUR million]

11 Restructuring on track - EUR 10.0 million special effects in Q1 2014/15 Zumtobel Group special effects FY 2014/15 Guidance: ~ EUR 20 million Adjusted EBIT in EUR million Q1 2014/15 Q1 2013/14 Change in % Reported EBIT Thereof special effects Adjusted EBIT Lighting (EUR 5.2 million) Operations restructuring Landskrona (EUR 4.7 million) Sales organisation adjustments (EUR 0.5 million) Components (EUR 4.7 million) Closure Fürstenfeld (EUR 1.0 million) Closure Ennenda (EUR 2.7 million) Miscellaneous (EUR 1.0 million)

12 Net result for the period at EUR 5.7 million Zumtobel Group Income statement in EUR million Q1 2014/15 Q1 2013/14 Change in % Revenues 323,5 309,3 4.6 Cost of goods sold Gross profit (w/o development) as a % of revenues R&D SG&A expenses adjusted for special effects Adjusted EBIT as a % of revenues Special effects EBIT as a % of revenues Financial results Profit before tax Income taxes Net profit or loss for the period Negative special effects of EUR 10 million burden net result for the period (minus EUR 5.7 million) Earnings per share ( in EUR)

13 Seasonal cash outflows from increase in working capital burdens the free cash flow Zumtobel Group Cash flow statement in EUR million Q1 2014/15 Q1 2013/14 Cash flow from operating results Change in working capital Change in other operating items Taxes paid/received Cash flow from operating activities Proceeds from the sale of non-current assets Capital expenditures on non-current assets Capital expenditures on non-current and current financial assets Change in liquid funds from changes in the consolidation range Cash flow from investing activities Free cash flow Cash flow from financing activities Effects of exchange rate changes on cash and cash equivalents Change in cash and cash equivalents Free cash flow development (cumulative figures in EUR million) Q1 H1 Q1-Q3 FY FY 2013/14 FY 2014/

14 Working capital slightly higher than in Q1 previous year Zumtobel Group Working capital Working capital in % of rolling 12-month revenues 20.2% 19.0% 18.2% 19.0% 18.2% 18.5% 17.0% 15.8% 16.0% Target range: 16% - 18% In % of rolling 12-month revenues, working capital increased slightly to 19.0% vs 18.2% in Q1 PY Increase of inventories (~ EUR 5 million vs. Apr 2014) and increase in receivables (~ EUR 16 million vs. Apr 2014) and decrease in payables (~ EUR 20 million vs. Apr 2014) Level of factoring unchanged compared to previous year (~ EUR 43 million) Q1 Q2 Q3 Q4 FY 2012/13 FY 2013/14 FY 2014/

15 Continued solid balance sheet structure and secured liquidity position Zumtobel Group Key balance sheet data in EUR million 31. July April 2014 Total assets 1.023, Net debt 159, Equity Equity ratio in % Gearing in % Investments Working capital 239, As a % of rolling 12 months revenues Secure liquidity position Consortium credit agreement with a term extending to October 2016 and a max. volume of EUR 350 million (EUR 195 million drawn by 31 July 2014) Unsecured lines of credit totalling EUR 89.2 million (as of 31 July 2014) Net debt totalled EUR million as of 30 July 2014 (PY: EUR million)

16 Complete reset of Group structure to realize maximum synergies between all brands & functions Zumtobel Group organizational structure Zumtobel Group* Lighting Segment Components Segment Global Sales 7 regions Global Sales 7 regions Business Division Thorn Business Division Zumtobel Business Division OEM & TPP Business Division Tridonic Product Portfolio Product Development Marketing Product Portfolio Product Development Marketing Product Portfolio Product Development Marketing Product Portfolio Product Development Marketing Global Operations 10 plants Global Operations 6 plants Group Technology Group Purchasing Corporate Functions *simplified illustration

17 Measures to unlock full potential in Global Operations Progress report Global Operations Key Spennymoor, UK Les Andelys, FR Landskrona, SE Usingen, DE Lemgo, DE Production volume >100 Mio EUR Production volume >50 Mio EUR Highland, US Tianjin, CN Production volume <50 Mio EUR Ennenda, CH Jennersdorf, AT Innsbruck, AT Guangzhou, CN Shenzhen, CN Lighting Segment 11 plants Components Segment 7 plants Dornbirn, AT Sydney, AU Auckland, NZ Recently announced shut downs or sale of plants (in total ca. 430 employees affected)

18 Measures to unlock full potential in Global Operations - targeting best in class cost structure Progress report Global Operations 1. Implementation of an efficient global manufacturing footprint Shut down of production lighting plant Tianjin, China (July 2014 / 70 employees) Shut down of production lighting plant Landskrona, Sweden (Dec / 155 employees) Shut down of production components plant Ennenda, Switzerland (Feb / 115 employees) Sale of Tridonic connection technology in Innsbruck, Austria (May 2014 / 97 employees) 2. Substantial reduction in the bill of material (41.7% of sales in FY 2013/14) Centralized function has been implemented Strategic purchasing project with KPMG has been initiated

19 Measures to unlock full potential in Global Sales to balance growth potential with cost savings Progress report Global Sales 1. Cost synergies from merging our two lighting brand sales organizations Reduction of close to 150 FTEs in the last six months (not fully P&L effective yet) Reduction of 18 sales offices 2. Sales force performance programme New incentive system for sales organization and upper management in place 3. Increase share of wallet Initiatives have been started successful reference projects show proof of concept 4. Selective build-up of the sales force in emerging markets

20 Working as ONE Group successful reference projects show proof of concept Zumtobel Group AZ Damiaan in Oostende Public hospital Artistic Thorn outdoor lighting combined with Zumtobel interior lighting Project volume: EUR Place: Oostende, Belgium Jeddah airport King Abdulaziz Int. Airport Combined product offering of Thorn and Zumtobel ensures realisiation of this highly complex project Project volume: USD 7.0 Mio incl. Tridonic components Place: Jeddah, Saudi Arabia Atkins Global Race track in Bahrain Formular 1 race-track Long-standing partner of Zumtobel opens the door for Thorn outdoor lighting products Project volume: EUR 1.2 Mio incl. Tridonic components Place: Manama, Bahrain Conad-supermarket Supermarket chain in Italy Zumtobel indoor lighting combined with Thorn outdoor lighting for the parking area Place: Altopascio, Italy

21 Working as ONE Group successful reference projects show proof of concept Zumtobel Group Aldi Supermarkets Aldi Supermarket stores in UK A new store program was realised using both Zumtobel and Thorn products Location: UK Post distribution center Austrian postal service Existing network towards our customer combined with low price level with Thorn products Location: Allhaming, Austria AZURIT Senior Citizens Center Retirement homes chain Thorn enabled very aggressive pricing level while maintaining high product quality Location: Germany Xi An South-Gate Watchtower Museum Museum in China Project led to first close collaboration of Thorn- and Zumtobel-teams in China Location: Xi An, China

22 Zumtobel Group becomes partner of Borussia Dortmund Zumtobel Group: Targetting significant growth in the German-speaking markets Ideal platform to drive our new multi-brand selling approach and thus the Thorn market entry to D-A-CH The partnership includes the realisation of various lighting projects for the football club (e.g. BVB FanWorld) sales supporting measures (packages built around attendance at one of Borussia Dortmund s home games) aimed at electricians, electrical planners and wholesale dealers of both brands

23 Zumtobel Group: We take lighting beyond illumination New mission and vision statement: Unique brands with a clear strategic direction We make great lighting available to all Offering cost efficient high performance lighting We offer the definitive solution to make any lighting smart, connected and efficient Offering a holistic architectrue of hard- and software that is easy to use We empower everybody to enjoy the superior light that we all love so much Offering superior lighting that is purposeful and inspiring We take lighting beyond illumination We leverage our multi-brand portfolio to create unique value for our customer

24 Latest forecast show non-residential construction slightly recovering in Europe Market environment / trends Growth Forecast for Non-Residential Construction Annual Growth Rates in % Forecast for 2014 shows non-residential construction slowly growing in Europe Austria (+0.5%), Germany (+2.7%), Switzerland (+1.9%) and Nordic (+2.2%) with modest growth UK recovering earlier and stronger than expected (+2.8% in 2014) France and Italy expected to see further declines -8.2 New build Renovation Total By 2015, non-residential construction will have declined by 20% compared to its peak in Source: Euroconstruct, June 2014 Total based on Austria, Belgium, Switzerland, Germany, France, Italy, Netherlands, UK and Nordic

25 Guidance unchanged for FY 2014/15 Zumtobel Group Outlook 2014/15 will be an important year of transition for the Zumtobel Group: Our key tasks are to bring the new structures to life, eliminate past inefficiencies and, in this way, leverage growth and cost synergies Confirming FY 2014/15 guidance of improvement in Group revenues and operating earnings Revenues: Slight tailwinds from the recovering construction market in Europe, but end of revenue stream from the exit of magnetic technology and sale of connecting clamp business we expect an increase of approx. 3% in group revenues in FY 2014/15 Earnings: We expect an improvement in the adjusted EBIT margin to 5% to 6% (adjusted EBIT margin 2013/14 financial year: 3.8%) Negative special effects of roughly EUR 20 million in 2014/

26 Financial Calendar September 2, 2014 Report on the First Quarter 2014/15 (1 May July 2014) December 9, 2014 Report on the First Half-year 2014/15 (1 May October 2014) March 3, 2015 Report on the First Three Quarters 2014/15 (1 May January 2015) Jun 24, 2015 Annual Financial Results 2014/15 July 24, 2015 July 28, 2015 July 31, th Annual General Meeting Ex-Dividend Day Dividend Payout Day September 8, 2015 Report on the First Quarter 2015/16 (1 May July 2015)

27 Thank you for your attention!

28 Disclaimer The facts and information contained herein constitute forward-looking statements as of the date they were made and based upon assumptions as to future events or circumstances that may not prove to be complete or accurate. By their nature, these statements involve risk and uncertainty because they relate to events and depend on circumstances that will occur in the future and are difficult to predict. Therefore, actual outcomes or results may differ materially from what is expressed, implied or forecasted in these statements. Neither Zumtobel AG nor any of its directors, officers, employees or advisors nor any other person makes any representation or warranty, expressed or implied, as to the accuracy or completeness of the facts and information contained in this document or the related oral presentation thereof, including responses to questions following the presentation. Neither Zumtobel AG nor any of its directors, officers, employees and advisors nor any other person shall have any liability whatsoever for loss howsoever arising, directly or indirectly, from any use of this document, the facts and/or information. Whilst all reasonable care has been taken to ensure the facts stated herein are accurate and that the assumptions and opinions contained herein are fair and reasonable, this document is selective in nature and is intended to provide an introduction to, and overview of, the business of Zumtobel AG as of the date this document was made. Where any information and statistics are quoted from any external source, such information or statistics should not be interpreted as having been adopted or endorsed by Zumtobel AG as being accurate. Contacts: Investor Relations Tel.: +43 (5572)

29 Five-Year Overview in EUR million 2013/ / / / /10 Revenues 1, , , , ,114.6 Adjusted EBIT as a% of revenues Net profit/loss for the period as a % of revenues Total assets 1, , , Equity Equity ratio in % Net debt Cash flow from operating results Investments as a % of revenues R&D total as a % of revenues Headcount incl. contract worker (full-time equivalent) 7,291 7,162 7,456 7,814 7,

30 Zumtobel Group - medium term targets (2016/17) Doubling of profitability driven by significant cost savings and modest growth EBIT adj. 2013/14 Baseline 3.8% Categories & Measures Targeted margin impact 1 Costs of Goods sold (w/o development) Implementation of an efficient global manufacturing footprint Bill of purchasing reduction 2013/14 level: 62.3% + 3-4% R&D R&D spending (through P&L) will slightly grow due to higher software content 2013/14 level: 5.5% - 0.5% SG&A (w/o research) Cost synergies from merging Performance programme Increase share of wallet 2013/14 level: 28.4% + 2-3% Contingency for market growth, price developments, mix change, inflation, FX effects - 0.5% EBIT adj. 2016/17 Target % 1) EBIT margin impact in FY 2016/17 assuming sales growth CAGR of 3-5% p.a