Solar Group Investor presentation

Transcription

1 Solar Group Investor presentation Michael H. Jeppesen, Group CFO 13 March 2014, Brussels roadshow

2 Investor presentation - agenda 1 Management agenda 2 The results we achieved in Q4 and FY The results we expect in Group strategy financial objectives 5 Dividends and capital structure 6 Appendix facts about Solar 2

3 Management agenda 2013 EBITA exceeded expectations despite write-down on property in Solar Deutschland. In 2013, we managed to generate strong cash flows and reduce our interestbearing debt considerably. We expect this trend to continue in On this basis, the Board of Directors will propose payout of dividends of DKK ( 1.61) per share for 2013 at the upcoming annual general meeting. Challenging outlook for

4 Organic growth of -4.9% in Q4 when adjusted for working days Organic growth Q Q % 6% 4% 2% Revenue, million Revenue growth, % Organic growth, % % -2% -4% -6% -8% -10% -12% Q1 Q2 Q3 Q4 FY

5 Difficult market conditions again in Q4 Negative growth in three of our four key markets Market update key markets In Denmark, we saw double-digit negative growth as sales of solar panels dropped compared to Q In Sweden, we focused on strengthening gross profit to increase earnings. Strong growth in Norway. In the Netherlands, we still saw difficult market conditions. However, operations were positive in Q4 which we see as the first sign of stabilisation. million Q Revenue Q Org. growth Denmark % Sweden % Norway % The Netherlands % Others % Group % 5

6 Gross profit margin up 0.7% compared with Q Gross profit margin Q Q ,8% 21,6% 21,4% 21,2% 21,0% 20,8% 20,6% 20,4% 20,2% 20,0% Q1 Q2 Q3 Q4 FY Revenue, million Revenue growth, % Organic growth, % Gross profit, million Gross profit margin Gross profit developed positively in Q In all key markets, gross profit was strengthened compared with Q

7 Normalised EBITA of 16.8m in Q EBITA margin Q Q ,5% 4,1% 3,7% 3,3% 2,9% 2,5% 2,6% 0,8% 0,5% -0.2% 0,5% -0.8% 3,4% Revenue, million Revenue growth, % Organic growth, % Gross profit, million ,1% 4,0% 3,0% 2,0% 1,0% 0,0% -1,0% -2,0% 7 Q412 COGS EOC Staff Debt. Deprec. Q413 Q1 Q2 Q3 Q4 FY Gross profit margin EBITA, million EBITA margin Write-down of 2.8m on property in Germany in Q Solar 8000 costs of 1.0m in Q and 0.7m in Q One-offs amounted to 0.8m in the Netherlands in Q

8 Normalised EBITA of 32.2m in 2013 EBITA margin FY 2013 FY ,6% 2,4% 2,2% 2,0% 1,8% 1,6% 1,4% 1,2% 3,0% 2,0% 1,0% 0,0% -1,0% -2,0% 8 0,1% 0,1% -0.7% 2,2% 0,0% 0,0% -0.3% 1,4% 2012 COGS Op. in. EOC Staff Debt. Deprec Q1 H1 9M FY Revenue, million 1, ,638.9 Revenue growth, % Organic growth, % Gross profit, million Gross profit margin EBITA, million EBITA margin Profit on sale of Aurora Group of 1.5m in Write-down of 2.8m on property in Germany in Solar 8000 costs and restructuring costs of 3.6m and 5.6m, respectively, in 2013 and 6.4m and 2.6m, respectively, in 2012.

9 Net working capital at year-end down to 11.5% but positively impacted by one-off effect in Denmark of 0.3% Net working capital (NWC) Net interest-bearing debt (NIBD) million 270 Acquisition of enterprises in NL, BE, DE, AU 16% million No. of times 3,1 2, Acquisition of operations from Otra 15% 14% Acquisition of enterprises in NL, BE, DE, AU Acquisition of operations from Otra 2,7 2,5 2, % ,1 1, % 60 1, % ,5 1, H NWC NWC/Revenue LTM 10% H NIBD NIBD/EBITDA LTM 1,1 Restatements have been made of 2012 and 2013 figures to compensate for the divestment of Aurora Group Danmark A/S. 9

10 Cash flow from operating activities was 39.7m in Q4 and 35.1m in FY 2013 Cash flow Cash flow, operating activities million ,3 million , , , ,3 10 7, M13 Oper. act. Inv. act. Fin. act. Other Net profit Depr. & amort. Tax & adj. Inv. Rec. Liab. Op. act. 10

11 Guidance 2014: Revenue 1,465-1,510m, EBITA 25-32m 2014 expectations: Expected Solar 8000 roll-out costs and restructuring costs of approx. 3m. The lower expectation level equals negative growth of approx. 2.5%, while the upper expectation level equals positive organic growth of approx. 0.5%. Net working capital at 13% on average and at 11% at year-end. Revenue million EBITA million E 2014E low high Revenue EBITA 0 Solar A/S disposed of Aurora Group Danmark A/S as of 24 April Thus, the figures for both 2012 and 2013 in this chart relate to continuing operations. 11

12 To increase profits is our number one priority We will achieve this through focused strategies and operation Foundation Ambition Strategies Operations Values Glow, SmartFun & Courage Focus on Northern Europe Mission We understand our customers needs and provide value adding services and products. We call it stronger together. To become one of the most profitable technical wholesalers in our markets To excel in Business Acumen, Operation & People Increase productivity Excel in sales Grow in the climate and energy area Daily operations Continuous improvement Simplification Standardisation Digitalisation Performance management Increased profit Vision Develop our people #1 in Technical Wholesale 12

13 Financial objectives 2015 onwards In 2015, strengthened growth, earnings, net working capital and ROIC are expected. This presupposes that our key markets maintain current levels. Objectives for equity ratio, gearing and dividends are unchanged. Long-term operating profit equalling an EBITA margin of 5-6% is expected. This presupposes organic growth of minimum 4%. The previously announced 2015 objectives for EBITA, ROIC and NWC are cancelled. Year Financial objectives Equity ratio % Gearing x Dividend % 13

14 Dividends and capital structure In 2013, Solar managed to generate positive cash flows and reduce debt. We expect this trend to continue in On this basis, the Board of Directors will propose payout of dividends of DKK ( 1.61) per share for 2013 at the upcoming annual general meeting. Also, the Board of Directors will ask for the authority to make the decision to distribute extraordinary dividends of up to DKK ( 2.01) per share and the authority to acquire treasury shares at up to 10% of the share capital at the upcoming annual general meeting. The Board of Directors will continuously work to ensure that we hold to a level of borrowing which, on one hand, ensures us flexibility when it comes to our ability to act on business opportunities and maintains our independence from the group s bankers while, on the other hand, ensuring that Solar does not become overcapitalised. 14

15 Appendix Facts about Solar

16 Solar in short Technical wholesaler One of Northern Europe s leading technical wholesalers within electrical, heating, plumbing and ventilation products Business We provide products, knowledge and solutions Presence Servicing customers in 9 countries from 11 central warehouses Revenue and employees 1,531.5m revenue* approximately 3,300 people Listed on NASDAQ OMX Copenhagen Listed on the stock exchange since 1953 * 2013 figures 16

17 Solar is listed on NASDAQ OMX Copenhagen and has a majority of long term investors 17

18 Solar s business areas are within: Electrical - HVAC&R - Plumbing - Renewable Energy Installation Cables Marine & Offshore Lighting Industry Communication Security Ventilation Heating, Water & Sanitation Renewable energy 18

19 Solar delivers products and solutions to customers within: Residential and Commercial Buildings Industry Marine and Offshore Business Ace Utility and Infrastructure Public Sector Operation People 19

20 Solar Blue Energy - making energy efficiency a better business A strategic focus area: A sales, marketing and training concept. One energy-efficient product is good an intelligent solution is better. Focus on renovation projects through cases and cost-savings potential. Cooperation between strategic suppliers and Solar. Business Ace The targets of the EU Climate and Energy Package are: A 20% reduction in EU greenhouse gas emissions based on 1990 levels by % of EU energy to come from renewable sources by A 20% reduction in primary energy use through improved energy efficiency by 2020, compared with projected levels. Operation People 20