Presentation of FAMUR

Transcription

1 Presentation of FAMUR LEADING EUROPEAN SUPPLIER OF INNOVATIVE SOLUTIONS

2 This presentation is the property of FAMUR S.A. Its processing, copying or saving on information carriers, in whole or in part, or making it available, in whole or in part, to third parties requires prior written consent of FAMUR S.A. Any statements contained in this presentation which do not refer to historical facts are forward-looking statements. Such forward-looking statements, in particular where they refer to future financial performance or potential development of the FAMUR Group, should not be regarded as firm forecasts. FAMUR S.A. can give not assurance that any predictions regarding the future will materialise. Future financial performance may significantly differ from projections.

3 AGENDA 1. Introduction 2. Equity story 3. Market environment 4. Financial highlights 5. Development prospects 3 Presentation of FAMUR. PROVEN SOLUTIONS, GLOBAL REACH

4 Key facts Leading European supplier of end to end solutions for the mining industry, transport, transshipment and power industries Dynamic growth in foreign markets Strong M&A track record - 16 successful acquisitions Profitability leader in the industry in the long term Majority Shareholder: TDJ: 57% 11 production plants 5,000+ employees PLN 1,905m* revenue PLN 423m* EBITDA 40%* exports PLN 1,460m ** PLN 308m ** 38% ** * Combined pro forma FAMUR & KOPEX 2017 full-year data * * FAMUR Group formal consolidation Presentation of FAMUR. PROVEN SOLUTIONS, GLOBAL REACH

5 AGENDA 1. Introduction 2. Equity story 3. Market environment 4. Financial highlights 5. Development prospects 5 Presentation of FAMUR. PROVEN SOLUTIONS, GLOBAL REACH

6 Key Highlights v 1 Leading European Player with proven track record of successful M&A 2 Wide ranging, innovative product offering 3 Clear Go Global strategy focused on internationalization with blue chip customer base 4 Leading financial results with significant further upside potential 5 Highly experienced management team and supportive majority shareholder 6 Presentation of FAMUR. PROVEN SOLUTIONS, GLOBAL REACH

7 Key Highlights v 1 Leading European Player with proven track record of successful M&A 2 Wide ranging, innovative product offering 3 Clear Go Global strategy focused on internationalization with blue chip customer base 4 Leading financial results with significant further upside potential 5 Highly experienced management team and supportive majority shareholder 7 Presentation of FAMUR. PROVEN SOLUTIONS, GLOBAL REACH

8 1 15 years of market consolidation Single product (shearer loader) Development of Underground product portfolio Famur s IPO Stable high margin revenue pillar: roadheaders operating lease Diversification: development of Surface segment Strategic market consolidation in region Presentation of FAMUR. PROVEN SOLUTIONS, GLOBAL REACH

9 1 Latest market consolidation Market consolidation Synergies Effects REVENUE SYNERGIES Combining the know-how and leveraging the capabilities of the Entities in engineering and sales areas, both in Poland and abroad Strong position in Poland and a comprehensive portfolio Leveraging the strengths of Entities to expand on foreign markets COST SYNERGIES: Headcount restructuring Divestments Optimization of resources and manufacturing processes Centralisation of sales, sales support, co-operation and logistics, integration of remaining central functions Revenue Profitability Efficiency Debt Cash Flows Dominant position on domestic market and leading European provider of complex solutions Margin: top level in the industry ROE increase through optimization Net debt/ EBITDA < 2 maintained Positive operating cash flows enabling acquisitions or dividend payment 9 Presentation of FAMUR. PROVEN SOLUTIONS, GLOBAL REACH

10 Key Highlights v 1 Leading European Player with proven track record of successful M&A 2 Wide ranging, innovative product offering 3 Clear Go Global strategy focused on internationalization with blue chip customer base 4 Leading financial results with significant further upside potential 5 Highly experienced management team and supportive majority shareholder 10 Presentation of FAMUR. PROVEN SOLUTIONS, GLOBAL REACH

11 2 Delivery of end to end solutions Machinery and Equipment From a manufacturer of narrow-use mining machines and systems... End-to-end Solutions... to a supplier of end-to-end solutions for the mining, transport, transshipment and power industries. Design Manufacturing Delivery Erection Commissioning Service 11 Presentation of FAMUR. PROVEN SOLUTIONS, GLOBAL REACH

12 2 Comprehensive portfolio of products 1. Shearer loaders 2. Powered roof support systems Scraper conveyors 4. Roadheaders 5. Drilling and bolting rigs 6. Haul trucks 7. Suspended monorail systems 8. Underground belt conveyors 9. Mining electrical equipment 10. Mine shaft 11. In-plant continuous transport 12. Surface belt conveyors 13. Stacker-reclaimers 14. Bucket-wheel excavators 15. Wagon tipplers 16. Surface infrastructure 17. Container cranes 18. Ship-to-shore gantry cranes 19. Power plant's coal feeding system 20. Loaders and dinting loaders 12 Presentation of FAMUR. PROVEN SOLUTIONS, GLOBAL REACH

13 Blast hole drillers Dragline excavators Haulers Excavators Bucket-wheel excavators Belt conveyor systems Stackers Powered roof support systems Shearer loaders Scraper conveyors Conveyor and transport equipment Roadheaders Bolter miners Continuous miners Haul trucks Crushing and continuous transport equipment Roof bolters Drill rigs Haul trucks Crushing equipment Roof bolters Shaft drilling Power supply and I&C equipment Shafts Electrical and I&C 2 Product range comprehensive product portfolio for mining industry Surface mining Underground mining Soft rock mining Hard rock mining Hard rock mining Soft rock mining Production Longwall systems Preparation works Room-and-pillar system Hard rock mining Presentation of FAMUR. PROVEN SOLUTIONS, GLOBAL REACH

14 Key Highlights v 1 Leading European Player with proven track record of successful M&A 2 Wide ranging, innovative product offering 3 Clear Go Global strategy focused on internationalization with blue chip customer base 4 Leading financial results with significant further upside potential 5 Highly experienced management team and supportive majority shareholder 14 Presentation of FAMUR. PROVEN SOLUTIONS, GLOBAL REACH

15 3 Global presence Key foreign Clients: GERMANY Sales office RUSSIA Sales and service center SERBIA Production plant KAZAKHSTAN Service center UKRAINE Service center INDONESIA Representation office RSA Production Plant INDIA Sales center CHINA Joint venture Production Plant and Service center The map presents countries where FAMUR products operate, as well as localizations of international Famur subsidiaries. 15 Presentation of FAMUR. PROVEN SOLUTIONS, GLOBAL REACH

16 3 Geographical split of revenue Share of exports in sales, Revenue by country 18% 26% 27% 30% 38% 50% Czech Republic 1% South Africa 1% Turkey 3% Austria 4% Germany 4% Other 6% 2017 Poland 62% target Russia 19% Go Global strategy of extensive global expansion with the assumption of being a preferred supplier of high quality end to end solutions for our sectors around the world The geographical split of revenue is variable, with Russia, Kazakhstan, Turkey, Argentina, US, Australia, India and Mexico considered the most promising markets 16 Presentation of FAMUR. PROVEN SOLUTIONS, GLOBAL REACH

17 Key Highlights v 1 Leading European Player with proven track record of successful M&A 2 Wide ranging, innovative product offering 3 Clear Go Global strategy focused on internationalization with blue chip customer base 4 Leading financial results with significant further upside potential 5 Highly experienced management team and supportive majority shareholder 17 Presentation of FAMUR. PROVEN SOLUTIONS, GLOBAL REACH

18 5 Leader in terms of margins FAMUR outperforms its competitors in terms of EBITDA margin 41,8% 28,5% 32,5% 29,6% Famur 19,6% 23,1% 23,8% 21,1% 21,5% 19,4% 15,6% Sandvik Komatsu Caterpillar JoyGlobal Source: Bloomberg *) Joy Global (currently: Komatsu Mining Corp) - EBITDA Q LTM 18 Presentation of FAMUR. PROVEN SOLUTIONS, GLOBAL REACH

19 5 Stable liquidity OCF cumulatively (PLNm) Net debt (PLNm) Q Presentation of FAMUR. PROVEN SOLUTIONS, GLOBAL REACH

20 5 Conservative debt approach WE PAID OUT PLN 700M IN DIVIDEND Over the past seven years, we have paid our shareholders over PLN 700m in dividends: PLN 300m in 2011, and PLN 404m in SAFE NET DEBT/EBITDA RATIO PRUDENT DEBT MANAGEMENT STRATEGY The Group has maintained low net debt, both historically and at present. Despite consolidation of the Kopex Group s balance sheet, at the end of Q1 2018, the FAMUR s gross cash position was PLN 607m, with loans and borrowings, lease obligations and bonds at PLN 620m a net debt position of PLN 13m Q Net debt EBITDA LTM Equity -0,1-0,4-0,3 0,1 0,4 0,4 0,4-0,5 0,7 0,3 0,1 PLN 13m PLN 340m PLN 1,586m -2,4 Our stable financial situation and prudent cash flow policy allow us to take advantage from market opportunities for development as well as pay dividends to our shareholders. 20 Presentation of FAMUR. PROVEN SOLUTIONS, GLOBAL REACH

21 Key Highlights v 1 Leading European Player with proven track record of successful M&A 2 Wide ranging, innovative product offering 3 Clear Go Global strategy focused on internationalization with blue chip customer base 4 Leading financial results with significant further upside potential 5 Highly experienced management team and supportive majority shareholder 21 Presentation of FAMUR. PROVEN SOLUTIONS, GLOBAL REACH

22 6 Professional management Bartosz Bielak Vice President of FAMUR Responsible for strategy and Responsible for strategy and development development Adam Toborek Vice President of FAMUR Longwall Systems Segment Waldemar Łaski President of Surface Segment Mirosław Bendzera President of Management Board of FAMUR Dawid Gruszczyk Vice President of FAMUR Roadheader Systems Segment Henryk Jurczyk President of Electrical Equipment Segment Beata Zawiszowska Vice President of FAMUR Responsible for prudent financial policy Zdzisław Szypuła Vice President of FAMUR Transportation Systems Segment Dariusz Ginalski President of Mining Services Segment 22 Presentation of FAMUR. PROVEN SOLUTIONS, GLOBAL REACH

23 6 Reliable majority shareholder Family-owned investment firm focused on long term value generation. Investing in controlling stakes in mature companies with potential for growth. Buidling long term value by leveraging decades of business experience in actively supporting companies and their management teams. Investing in ambitious development projects in the areas of commercial, residential, industrial agricultural and greenfield real estate. Investing in technologically advanced innovative startups that are led by outstanding entrepreneurs Our investments: Our investments: Our investments: Investing in liquid assets with short-term investment horizon and low risk profile. Investing in education and personal development. We believe that investing in knowledge and human potential creates the greatest value added for society. To date, we have helped more than 500 children to receive top-quality education. Learn more at: 23 Presentation of FAMUR. PROVEN SOLUTIONS, GLOBAL REACH

24 AGENDA 1. Introduction 2. Equity story 3. Market environment 4. Financial highlights 5. Development prospects 24 Presentation of FAMUR. PROVEN SOLUTIONS, SOLUTIONS. GLOBAL FLOBAL REACH

25 Positive global demand outlook Key markets POLAND Company s ddemand forecast vs 2017 Main products Complete range products: longwall systems, conveyors, transport and handling systems, power systems RUSSIA AND KAZAKHSTAN Longwall systems, transport and handling systems, transshipment machinery for open-pit mining TURKEY Longwall systems, transport and handling systems, transshipment machinery and machinery for the power industry CHINA Longwall systems, transport and handling systems, transshipment machinery and machinery for the power industry US Longwall systems, transport and handling systems, transshipment machinery and machinery for the power industry ARGENTINA AND MEXICO Surface transport and handling systems, transshipment machinery and machinery for the power industry INDIA Complete range of products OTHER CEE COUNTRIES Surface transport and handling systems, transshipment machinery THE BALKANS SOUTH AND CENTRAL AFRICA Transport and handling / transshipment systems Complete range of products According to the International Energy Agency (2017 report ), the volume of energy generated from coal will increase from 9,282 TWh in 2016 to 10,086 TWh in 2040, i.e. by 9% (CAGR of 0.4%). Coal will remain the main energy source for electricity production in China and India, and Southeast Asia will triple the amount of electricity generated from coal. 25 Presentation of FAMUR. PROVEN SOLUTIONS, GLOBAL REACH

26 Germany Colombia Brazil Botswana Pakistan Slovenia Spain Iran Mongolia Vietnam Bangladesh Belarus Global coal markets followed by long tail 2017 UG Coal Mining CapEx USD bn ,5 3,6 1,4 0,9 0,5 0,5 0,3 0,2 0,1 0,1 0,1 0,1 0,1 0,0 Mongolia has ~10% of world's coal reserves but only 17 coal mines (mostly open cuts) large long term potential 0,0 0,0 0,0 Bangladesh plans to shift to coal generation (50% by 2022) but current production covers 2% Vietnam to build 70 new coal-fired power plants by 2030 and drive UG coal mining 0,0 0,0 0,0 0,0 0,0 0,0 Some potential investments may materialize in next years; potential also for LW in potash 0,0 0,0 Growth CapEx SIB CapEx China USA Australia India Russia Ukraine South Africa Indonesia CanadaCzech Rep. Kazakchstan Philipp-inesTurkey 1,4 0,1 0,6 0 0, , ,1 3,5 0,8 0,9 0,4 0,5 0,3 0 0,1 0,1 0,1 0,1 0,1 Source: USGS, SNL, BCG Mining Market Navigator, BCG Analysis 26 Presentation of FAMUR. PROVEN SOLUTIONS, GLOBAL REACH

27 Significant domestic capex growth expected since 2018 Total planned CAPEX by company (PLN m) +24% 2,588 2,538 2,450 Cumulative CAPEX (PLN m) Total CAPEX 1 High level equipment CAPEX 2 estimates 3,277 2,698 1,410 1,360 1, ,110 2,040 2,040 2, Total cumulative CAPEX for given period including development and sustaining CAPEX (including development works), excluding rental as captured in Kopex; 2. Initial estimates of equipment CAPEX based on expert interviews and BCG benchmarks 3. In May 2017 Tauron Wydobycie signed the contract for 1st phase of mineshaft "Grzegorz" construction with consortium of Famur Pemug and Kopex. Value deal: 227,87M PLN Presentation of FAMUR. PROVEN SOLUTIONS, GLOBAL REACH Source: Company reports, press, expert interviews, BCG analysis

28 AGENDA 1. Introduction 2. Equity story 3. Market environment 4. Financial highlights 5. Development prospects 28 Presentation of FAMUR. PROVEN SOLUTIONS, GLOBAL REACH

29 Financial highlights * 2017 COMBINED + Q Q PLN 1,030m Revenue PLN 1,460m Revenue +42 % PLN 1,905m Revenue PLN 493m Revenue +2 % PLN 502m Revenue PLN 239m EBITDA PLN 289m EBITDA ** +21% PLN 404m EBITDA ** PLN 93m EBITDA ** +11% PLN 103m EBITDA 23% EBITDA margin 20% EBITDA margin ** -15 % 21% EBITDA margin ** 19% EBITDA margin ** +11% 21% EBITDA margin PLN 114m EBIT PLN 114m EBIT ** 0% PLN 172m EBIT ** PLN 35m EBIT ** +49% PLN 52m EBIT PLN 94m Net profit PLN 82m Net profit** -13 % PLN 124m Net profit** PLN 20m Net profit** +95% PLN 39m Net profit PLN 133m Net cash PLN 80m Net debt -213m PLN 80m Net debt PLN 80m Net debt PLN 13m Net debt NOTES: * Kopex results are consolidated since H / ** EBIT, **EBITDA, **EBITDA margin, Net Profit - normalized i.e. excluding Q one-offs +67m 29 Presentation of FAMUR. PROVEN SOLUTIONS, GLOBAL REACH

30 Reporting segments and split of revenue UNDERGROUND SURFACE ELECTRICAL EQUIPMENT MINING SERVICES Revenue split by segment 13% The share of aftermarket revenues increases gradually and gross margin level reaches 30-45% Revenue split by source 10% 5% 16% 66% Operating leases of shearers and roadheaders provide a recurring and highly profitable revenue base. 17% 70% Underground Surface Electrical Equipment Mining Services Long term contracts Aftermarket & services Operating lease 30 Presentation of FAMUR. PROVEN SOLUTIONS, GLOBAL REACH

31 AGENDA 1. Introduction 2. Equity story 3. Market environment 4. Financial highlights 5. Development prospects 31 Presentation of FAMUR. PROVEN SOLUTIONS, GLOBAL REACH

32 Global expansion scenarios Target markets RUSSIA TURKEY Organic growth Organic growth investments building new representative offices in the foreign markets Lessons learned from market leaders INDONESIA MEXICO INDIA Strategic acquisitions Acquisition of a foreign targets expansion of the know-how, production base and sales markets CHINA BFCTP SAS USA Strategic alliances / joint ventures CANADA AUSTRALIA Agreements on joint operations in particular markets expansion of markets, mutual benefits for the partners Strategic acquisitions Alliances / Joint Ventures 32 Presentation of FAMUR. PROVEN SOLUTIONS, GLOBAL REACH

33 Thank you for your attention! Olga Panek Investor Relations Director Presentation of FAMUR. PROVEN SOLUTIONS, GLOBAL REACH

34 Appendices Other information 34 Presentation of FAMUR. PROVEN SOLUTIONS, GLOBAL REACH

35 Our values BELIEF RESPONSIBILITY COOPERATION OPENNESS CREDIBILITY We believe in the common vision We follow our set of values We focus on the future We believe that investment in education and development generates the highest value for society We make bold and wellconsidered decisions We take responsibility for our and our team s decisions and actions We require initiative of ourselves We always act in the best interest of the firm We trust each other and form a tight-knit team We listen and learn from others by considering each voice in discussion After making the decision, we act as one to achieve our goal We celebrate the success of our people by promoting them in the organization We are loyal towards one another and communicate openly and with honesty We respect diversity of opinions We are open to change and innovations We discuss the mistakes we make and learn from them We always keep our word We are reliable and honest We are committed to fair play We meet our commitments 35 Presentation of FAMUR. PROVEN SOLUTIONS, GLOBAL REACH

36 Shareholder structure Shareholder structure as at 13th April 2018: 25,93% Listed on Warsaw Stock Exchange Ticker: FMF Index: mwig40 Index: MSCI 9,30% * 58,45% 6,32% Other * including Tomasz Domogała shares 36 Presentation of FAMUR. PROVEN SOLUTIONS, GLOBAL REACH

37 100 years of experience in Piotrowice a company is set up, "Stephan, Froelich Kluepfel AG", manufacturing simple steel structures and mining machinery components. In 2002 TDJ private investment company acquires FAMUR shares and begins market consolidation process Presentation of FAMUR. PROVEN SOLUTIONS, GLOBAL REACH

38 Key production facilities SURFACE UNDERGROUND KATOWICE (FAMUR) KONIN (FUGO) * ZGORZELEC (FAMAGO) * PIOTRKÓW TRYBUNALSKI (PIOMA) KLUCZBORK (FAMAK) CHORZÓW (ELGÓR + HANSEN) * ZABRZE (KOPEX) * RYBNIK (RYFAMA) * GORLICE (GLINIK) KATOWICE (REMAG) NOWY SĄCZ (NOWOMAG) * Acquired in Presentation of FAMUR. PROVEN SOLUTIONS, GLOBAL REACH