Bruker Corporation (NASDAQ: BRKR)

Transcription

1 Corporation (NASDAQ: BRKR) William Blair Growth Stock Conference June 12, 2013 Charles Wagner, CFO Joshua Young, VP, Investor Relations

2 Corporation Safe Harbor Statement Any statements contained in this presentation that do not describe historical facts may constitute forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of Any forward-looking statements contained herein are based on current expectations, but are subject to risks and uncertainties that could cause actual results to differ materially from those projected, including, but not limited to, risks and uncertainties relating to adverse changes in conditions in the global economy and volatility in the capital markets, the integration of businesses we have acquired or may acquire in the future, changing technologies, product development and market acceptance of our products, the cost and pricing of our products, manufacturing, competition, dependence on collaborative partners and key suppliers, capital spending and government funding policies, changes in governmental regulations, realization of anticipated benefits from economic stimulus programs, intellectual property rights, litigation, and exposure to foreign currency fluctuations and other risk factors discussed from time to time in our filings with the Securities and Exchange Commission. These and other factors are identified and described in more detail in our filings with the SEC, including, without limitation, our annual report on Form 10-K for the year ended December 31, 2012, our most recent quarterly reports on Form 10-Q and our current reports on Form 8-K. We expressly disclaim any intent or obligation to update these forwardlooking statements other than as required by law. 2

3 Agenda 1 Overview of 2 Driving Profitable Growth 3 Financial Update 3

4 Overview of 4

5 Key Messages 1 We are a premium brand that has consistently delivered higher than industry average organic growth 2 We have added new management and modernized our organizational structure to drive change and efficiency 3 We are evaluating and implementing initiatives to accelerate growth in our adjusted EPS and cash flow

6 Company Profile : the leading provider of high-performance scientific instruments and solutions for life and materials science, diagnostics and applied markets KEY FIGURES Founded in 1960 $1.79B revenue in 2012 ~6,436 employees Scientific Instruments (BSI) ~94% revenue Energy & Supercon Technologies (BEST) ~6% revenue ~Direct sales organizations in 33 countries ~1,000 R&D professionals with strong track record of innovation BioSpin CALID Materials 6

7 Nearly 80% of our revenues are generated outside of the United States Europe United States Asia Pacific Rest of World 2012 revenues 7

8 We have distinct capabilities and leadership positions in many product lines BioSpin CALID MAT BEST 1. Nuclear Magnetic Resonance (NMR) 2. Electron Paramagnetic Resonance (EPR) 3. Preclinical imaging incl. MRI, µct, PET/SPECT, optical molecular imaging 1. Life-Science and Applied Mass Spectrometry 2. MS Diagnostics 3. GC and LC chromatography 4. FT-IR/NIR/Raman 5. CBRNE Detection 1. Atomic Force Microscopy (AFM) 2. X-ray Diffraction, Crystallography, and Fluorescence 3. Optical Metrology, Profilometry 4. Spark-OES, handheld XRF 5. EDS, EBSD 1. LTS and HTS Superconductors 2. Superconducting devices 3. Big Science research infrastructure Indicative: not representative of all products sold and industries served 8

9 Most of our revenues are derived from academic, industrial & biopharma markets BioSpin CALID MAT BEST Markets Served Markets Served Markets Served Markets Served 1.Academic & Medical Schools 2.Pharma/Biotech 3.Government 4.Applied: food authenticity, IVD/RuO, industrial 1.Academic and Omics research 2.Microbiology / IVD 3.Pharma/Biotech 4.Applied: enviro, food, forensics, energy, petrochem 5.Homeland Security 1.Industrial research and QC 2.Semiconductor, LED, data storage, display, solar 3.Academic 1.Healthcare (MRI) 2.Life-Science tools (NMR, EPR, FTMS) 3.Renewable energy research (e.g. ITER) 4. Big Science Indicative: not representative of all products sold and industries served 9

10 Driving Profitable Growth 10

11 Our strong track record of innovation has enabled us to grow faster organically than the industry Revenues [$ m] Organic Growth Rate 3.2% 0.0% 12.7% 9.2% 11.9% 11

12 ...but increases in profitability and cash flow have not been sustained Non-GAAP Operating Margin Free Cash Flow Per $1 of Revenue 12

13 Our efforts to drive profitability & cash flow improvements will be a multi-year process New Leadership & Organization Simplified organizational structure New leaders & incentive structures Globalized approach to business Incremental Profit Improvement Better expense control Evaluation: structure & processes Targeted outsourcing/restructuring Sustained Profitable Growth Additional supply chain initiatives Improved resource allocation IT investments & process change Complement Innovation/Growth with Margin-Performance Culture Incentives programs focus on profitability and cash flow Greater visibility and accountability 13

14 ...and we have already taken actions which will help us to lower costs in 2014 Facility Closures Closing a Optics plant in the US Closing a CAM plant/r&d facility in Europe Closing a BEST plant Europe Outsource & Divest Further outsourcing of BioSpin and other Groups non-core manufacturing Select product line divestitures Financial Impact Reduction in headcount of ~150 employees $20-$25M of restructuring costs in 2013 Goal: $10M of annualized savings in

15 Business & Market Update 15

16 We are off to a slow start in Key Messages Lower than expected revenues were the result of: 1. Substantial weakening of Japanese Yen 2. Weakness in semiconductor & data storage markets 3. Temporary operational issues Revenue shortfall disproportionately affected profitability Overall year-over-year mid-single digit growth in bookings Expect to regain momentum in remaining quarters of year, maintaining organic revenue growth guidance for FY 2013 Q Financials Revenues [$ m] -3% Key Financials Q organic revenue decline: -1.1% Non-GAAP operating margin decline: -470 basis points Operating Margin * -470 bps * Non-GAAP 16

17 ...but we expect to generate improved performance in Q2 and H Address operational issues to complete customer installations and capture delayed revenue 2 Continue to control discretionary spending and identify other profit recovery opportunities 3 Deliver on remaining 2013 initiatives to improve cost and inventory productivity in

18 Revised Guidance FY 2013 FY 2013 Guidance Revenue Growth ~2%-3% ASSUMPTIONS Organic revenue growth of approximately 3% Restructuring Costs ~$20-$25M Year-on-year growth and sequential improvement in Q Non-GAAP Tax Rate ~27%-30% Non-GAAP EPS $ $0.83 Gradual recovery of delayed Q1 revenue Profitability and growth now more skewed to 2 nd half, especially Q4 Reported GAAP numbers will be burdened by restructuring charges Currency assumptions against US dollar: Yen: 0.98 EUR:

19 We expect to make significant progress in strengthening in 2013 New management & incentives put in place New IT systems & processes provide better visibility into the business First operational improvement initiatives completed Better control and lower growth of operational spending Continued product innovation and excellent customer relationships 19

20 Why Invest in? A Strong Foundation Premier brand for high-performance life-science, diagnostics and analytical scientific instruments Strong innovation and organic growth record, expanding market share, high ROIC Excellent customer relationships and collaborations with Realistic Upside Potential Strong organic growth opportunities remain Profitability and cash flow improvements represent value Commitment to continuous improvement: further foundation building underway in terms of management talent and processes, systems and operational excellence 20

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