H1/2017 Results u-blox Holding AG

Transcription

1 H1/2017 Results u-blox Holding AG August 24, 2017 Thomas Seiler, CEO Roland Jud, CFO locate, communicate, accelerate

2 Disclaimer This presentation contains certain forward-looking statements. Such forward-looking statements reflect the current views of management and are subject to known and unknown risks, uncertainties, assumptions and other factors that may cause actual results, performance or achievements of the Group to differ materially from those expressed or implied herein. Should such risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those described in this presentation. u-blox is providing the information in this presentation as of this date and does not undertake any obligation to update any forward-looking statements contained in it as a result of new information, future events or otherwise. Slide 2

3 Agenda Operational highlights H1/2017 Financial results H1/2017 Business review Outlook Q&A Slide 3

4 Operational highlights H1/ % revenue increase as compared to the first half of 2016 EBIT margin increased in line with business growth Cash flow from operating activities declined Revenue and EBIT guidance maintained Strong product innovation 8 new cutting-edge products launched Continued investment in R&D Slide 4

5 u-blox group H1/2017 Key figures Amount CHF In relation to Change H1/2017 revenue over H1/2016 Revenue 193.9m - 7.9% Gross profit 87.4m 45.1% 5.9% EBITDA 40.3m 20.8% 2.8% Operating profit (EBIT ) 29.5m 15.2% 6.1% Net profit, attributable to owners of the parent 18.0m 9.3% -2.6% Net cash generated from operating activities 22.1m 11.4% -16.0% Remark: All numbers are IFRS based. Adjusted numbers shown on slide 15 Slide 5

6 Revenue and EBITDA Revenue and EBITDA Comments (million CHF) 400 Business managed to profitable growth Continued organic growth of revenues (+7.9% compared to H1/2016) Currency impact on revenue to H1/2016 rates: -0.3% % to guidance rates: -1.8% H1/15 H1/16 H1/17 Revenue EBITDA Slide 6

7 Markets trends Revenue split per market for H1/2017 Comments Automotive Consumer market growth with wearables and smart bikes Good progress in Automotive Industrial markets expanding in all applications Consumer Industrial Note: Estimate Slide 7

8 Revenues by geography Revenues by geographic region Comments (million CHF) 400 Growth in two geographic regions compared to H1/ Asia Pacific +25.3% % 25% EMEA: +8.5% Americas: -20.7% % 29% 25% 7.9% Growth in all geographic regions compared to H2/ % 25% 29% 26% 28% 26% 21% Asia Pacific +8.0% EMEA: + 9.1% Americas: +3.9% 50 48% 48% 50% % 46% 53% H1/15 H1/16 H1/17 Note: based on customers billing location APAC Americas EMEA Slide 8

9 Gross profit Gross profit / Gross profit margin Comments % Increase in gross profit to CHF 87.4m in H1/ % 45.8% % % 45.9% 45.1% 5.9% 50% 40% 30% Growth of gross profit of +5.9% compared to H1/2016 Gross profit margin in H1/2017 was slightly lower compared to H1/2016 due to changes in the product mix % % H1/15 H1/16 H1/17 0% Gross Profit % of revenue Slide 9

10 Shipments and ASP development Growth of both module and chip volume Shipments of new positioning platform u-blox 8/M8 strongly growing Modules GNSS chips (million pcs) (CHF) (million pcs) (CHF) % % % H1/15 H1/16 H1/ H1/15 H1/16 H1/17 0 Shipments modules ASP Antaris u-blox 5 u-blox 6 u-blox 7 u-blox 8/M8 ASP Note: incl. ANTARIS-Chipset sales by Atmel Slide 10

11 Global customer base Number of customers totaling 80% of revenue Comments 70 Strong and stable customer base, serving now 5700 customers worldwide 60 Continued wide spread over different applications and geographical regions No important customer dependency: Largest customer accounts for less than 5.3% of total revenue in H1/ biggest customers account for 33.9% of total revenue in H1/ H1/15 H1/16 H1/17 Slide 11

12 Distribution & marketing / Research & development Distribution & marketing expenses Research & development expenses % 8.2% 8.9% % % 8.8% % 9% 8% 7% 6% 5% 4% 3% 2% 1% % 19.2% 17.6% 18.5% 16.5% 17.9% % 20% 15% 10% 5% H1/15 H1/16 H1/17 0% H1/15 H1/16 H1/17 0% Sales & Marketing % of revenues Research & Development % of revenues Slide 12

13 Employees Employee breakdown (end of H1/2017, FTE based) Average employee level (FTE based) Logistics, Administration 15% Sales, Marketing, Support 18% 161 (Total FTE = 895) Research & Development 67% End of H1/2017, FTE based H1/15 H1/16 H1/17 Note: 76% of employees based outside Switzerland (spread over 18 countries) Note: Average number of employees (FTE = full time equivalent) Slide 13

14 Income statement - IFRS Consolidated income statement (condensed) January - June Jan. - Dec. (in CHF 000s) Revenue 193' ' '230 Cost of sales -106'518-97' '123 Gross profit 87'390 82' '107 % gross profit margin 45.1% 45.9% 46.4% Operating expenses -58'707-55' '136 Other income 845 1'216 2'033 Operating profit (EBIT) 29'528 27'843 59'004 Financial income '337 Finance costs -6'979-3'016-1'653 Profit before income tax (EBT) 22'858 24'950 61'688 Income tax expense -4'846-6'453-15'488 Net profit, attributable to owners of the parent 18'012 18'497 46'200 Operating profit (EBIT) 29'528 27'843 59'004 Depreciation and amortization 10'730 11'301 22'762 EBITDA 40'258 39'144 81'766 Comments Revenue increase of 7.9% from H1/2016 to H1/2017 Increased gross profit by 5.9% OPEX 30.3% of revenue H1/2017: costs for share based payments in the amount of CHF 4.1m EBITDA with margin of 20.8% EBIT margin of 15.2% with growth of 6.1% compared to H1/2016 Finance costs contain mainly unrealized foreign exchange losses, and interests for the bonds Tax rate of 21.2% compared to year end 2016 with 25.1% Net Profit margin of 9.3% EPS = CHF 2.61 (diluted EPS: CHF 2.57) Slide 14

15 Income statement Adjusted (in CHF 000s) January - June Adjustements January - June January - June Pension impact Amortization 2017 Share based based on Non-recurring intangible assets (IFRS) payments IAS-19 expenses acquired (adjusted) (adjusted) Revenue 193' ' '688 Cost of sales -106' '131-96'873 Gross Profit 87' '777 82'815 % gross profit margin 45.1% 45.3% 46.1% Operating expenses -58'707 3' '218-52'326-49'705 Other income '216 Operating profit (EBIT) 29'528 4' '218 36'296 34'326 % margin 15.2% 18.7% 19.1% Financial income Finance costs -6'979-6'979-3'016 Profit before income tax (EBT) 22'858 4' '218 29'626 31'433 Income tax expense -4'846-1'079-5'925-6'287 Net profit, attributable to owners of the parent 18'012 2' '218 23'701 25'146 Earnings per share in CHF Diluted earnings per share in CHF Operating profit (EBIT) 29'528 4' '218 36'296 34'326 Depreciation and amortization 10'730-1'218 9'512 10'022 EBITDA 1) 40'258 4' '808 44'348 % EBITDA margin 20.8% 23.6% 24.7% 1) Management calculates EBITDA (earnings before interest, taxes, depreciation and amortization) by adding back depreciation and amortization to operating profit (EBIT), in each case determined in accordance with IFRS. Slide 15

16 Segment information Positioning and Wireless services Total segments Non-allocated/ Group wireless products eliminations January - June January - June January - June January - June January - June (in CHF 000s) Revenue third 193' ' ' ' ' '688 Revenue intragroup 12'172 14'944 12'172 14'944-12'172-14' Total revenue 193' '546 12'265 15' ' '632-12'172-14' ' '688 EBITDA 39'728 36' '244 40'095 39' '258 39'144 Depreciation -3'397-3'063-1' '453-3' '453-3'986 Amortization -6'253-7' '277-7' '277-7'315 EBIT 30'078 25' '298 29'365 28' '528 27'843 Financial income Finance costs -6'979-3'016-6'979-3'016 EBT -6'507-3'091 22'858 24'950 June 30 Dec 31 June 30 Dec 31 June 30 Dec 31 June 30 Dec 31 June 30 Dec Assets 273' '879 26'644 21' ' ' ' ' ' '872 Slide 16

17 Statement of financial position (1) Consolidated Statement of financial position (condensed) June 30, Dec. 31, June 30, (in CHF 000s) (unaudited) (audited) (unaudited) ASSETS Current assets Cash and cash equivalents 163' ' '265 Marketable securities 4'831 7'573 10'150 Trade accounts receivable 46'084 39'792 42'579 Other current assets 52'102 42'670 53'821 Total current assets 266' ' '815 Non-current assets Property, plant and equipment 15'570 15'774 13'785 Goodwill 54'621 54'104 55'160 Intangible assets 132' '905 97'520 Financial assets 1'139 1' Deferred tax assets 2'458 2'435 7'079 Total non-current assets 205' ' '331 Total assets 472' ' '146 Comments Strong financial position with a liquidity (incl. marketable securities) of CHF 168.6m Inventory CHF 37.9m (Dec. 2016: CHF 31.6m) Trade accounts receivable increase towards December 2016 Increased intangible assets due to capitalization of R&D expenses Goodwill (CHF 54.6m) slightly increased by CHF 0.5m as result of exchange rate changes mainly in GBP and EUR Slide 17

18 Statement of financial position (2) Consolidated Statement of financial position (condensed) June 30, Dec. 31, June 30, (in CHF 000s) (unaudited) (audited) (unaudited) LIABILITIES AND EQUITY Liabilities Current liabilities 57'307 59'098 46'070 Non-current liabilities 140'676 81'047 88'072 Total liabilities 197' ' '142 Shareholders equity Share capital 6'238 6'152 6'125 Share premium 65'180 74'387 73'345 Retained earnings 203' ' '534 Total equity 274' ' '004 Total liabilities and equity 472' ' '146 Comments Trade accounts payable of CHF 17.7m Second bond of CHF 60m issued in April 2017 (6 years, interest rate 1.375%) Non-current liabilities contain in addition to the bonds Deferred tax liabilities (CHF 1.3m), Employee benefits (pensions) (CHF 12.8m) Provisions (CHF 7.3m) Share capital increase due to exercise of options Equity reduced because of treasury shares purchased for option program (CHF 24.4m) Slide 18

19 Statement of financial position Total equity and equity ratio Comments (million CHF) (% of total assets) Strong capital base % Equity ratio of 58.1% % 64.2% 67.0% 63.9% 65.4% 58.1% 80% 70% 60% Treasury shares for option program decreased equity by CHF 24.4m Equity ratio without treasury shares: 63.3% % 40% 30% 50 20% 10% H1/15 H1/16 H1/17 0% Total Equity Equity ratio Slide 19

20 Statement of cash flows Consolidated statement of cash flows (condensed) Jan. - June 2017 Jan. - June 2016 (in CHF 000s) (unaudited) (unaudited) Net cash generated from operating activities Net cash used in investing activities Net cash provided by financing activities 22'061 26'256-27'914-19'622 26'021-11'581 Comments Cash flow from investing activities: CHF -4.3m investments into property, plant and equipment (equipment, tools) CHF -26.7m investments into intangible assets (Software, capitalization of R&D) CHF 2.7m net proceeds from marketable securities Net increase/(decrease) in cash and cash equivalents Cash and cash equivalents at beginning of period Effect of exchange rate fluctuations on cash and cash equivalents Cash and cash equivalents at end of period 20'168-4' ' '387-5' ' '265 Cash flow from financing activities: CHF -14.5m dividend 2016 paid in May 2017 CHF +5.4m capital increase from options CHF +59.3m issued bond April 2017 CHF -24.4m purchase of treasury shares for employee share option program Slide 20

21 Business update

22 Product launches highlights TOBY-L4 The LTE module provides a secure solution for automotive OEMs enabling data, voice, positioning, ecall and advanced telematics. SARA-S200 This ultra small module offers significant size and cost savings for secure and robust M2M and IoT wireless applications. SARA-R410M The world s smallest quadband LTE module, ideal for diverse IoT and M2M applications including smart cities, connected healthcare and more. VERA-P1 The latest in a range of automotive-grade transceiver modules that enables the next generation of Advanced Driver Assistance Systems. NINA-W131 & NINA-W132 Secure ultra low power Wi-Fi modules that efficiently integrate Wi-Fi connectivity into IoT devices. JODY-W1 The automotive Wi-Fi & Bluetooth module enables real simultaneous dual band operation for faster Wi-Fi connectivity and is ideal for infotainment and telematics applications. UBX-M8230-CT Ground-breaking GNSS receiver chip for wearable applications offering a unique balance of performance and ultra-low power use. ZOE-M8G An ultra-compact GNSS receiver module which offers exceptionally high location accuracy especially designed for wearables, drones and asset trackers. Slide 22

23 Customer highlights (1) All products (Cellular, Short Range, Positioning) experienced strong traction WHILL KK, Japan Wheelchair featuring cloud connectivity Product: 3G Cellular Module HEX, Taiwan Drone Navigation Kit Product: NEO-M8P HMS Industrial Network, Germany Wireless industrial bolt Product: ODIN-W2 module Slide 23

24 Customer highlights (2) Panasonic, Japan Tablet Product: NEO-M8 Digicom, Italy NB-IoT products and solutions Product: SARA-N2 Navilock, Germany GNSS receiver series Product: NEO-M8U Slide 24

25 Strategic priorities 2017 (1) Market position Outlook 2017 Develop range of products aimed at replacing legacy cellular technology in IoT applications calling for a long service life and low data rates. Introduce high-precision location technology to the mass market. Technology & Innovation Outlook 2017 Develop low-data-rate NB1, M1 and RPMA modules for IoT applications. Offer tools and development environments that enable shorter time to market. Roll out u-blox s principles for security across all products. Slide 25

26 Strategic priorities 2017 (2) Operational excellence Outlook 2017 Use economies of scale to reduce cost-to-revenue ratio as company expands. Exploit multiple sourcing agreements to make supply chain more robust. Strategic partnerships & acquisition opportunities Outlook 2017 Build on relations with major global cellular operators around low-data-rate products. Continue to review potential acquisitions that will strengthen our product portfolio and technology base, and extend global reach. Slide 26

27 Sapcorda (Safe And Precise CORrection DAta) Sapcorda Services GmbH is based in Berlin. Will distribute GNSS positioning services for high precision GNSS applications. Targeting mass market applications such as Automotive, Industrial & Consumer. Setup as a Joint Venture with u-blox, Bosch, Geo++, Mitsubishi Electric. Service to be sustained by the involved industry. No single partner has a majority share. Each partner has a strategic interest in Sapcorda s services. Joint Venture announced on 8 th August Closing expected for mid October Slide 27

28 Sapcorda Sapcorda to distribute GNSS correction services to serve the mass market Global and continent wide coverage. One way communication (Broadcast) with satellite & terrestrial internet communication channels. GNSS Communication Satellite Open system: Available to all GNSS receiver manufacturers. Targeted at OEMs and system integrators (B2B business model). Affordable for mass markets (e.g. Cars, Surveying, Agriculture & Machine Control). GNSS receiver Internet SSR correction service Slide 28

29 Outlook

30 Financial performance and guidance 2017 Continued business growth in 2017 unchanged guidance Impact by product mix on relative gross margin Natural hedging protects relative gross margin against foreign exchange variations Actual FY 2015 Actual FY 2016 Guidance 2017 *) Revenue 338.3m 360.2m 410m 425m EBIT 51.3m 59.0m 60m 65m CHF CHF CHF *) This guidance is based on the absence of unforeseen economic adversity and exchange rates assumed at budget level Exchange rate assumptions for 2017: EUR/CHF: 1.07 USD/CHF: 1.02 GBP/CHF: 1.23 FX-sensitivity against CHF on Guidance % of USD EUR GBP Revenue + 8.6% + 1.3% 0% EBIT % + 1.0% - 2.0% Slide 30

31 Upcoming events Investor and analyst day October 31, annual results March 15, 2018 Annual General Meeting April 24, 2018 Slide 31

32 Thank you! locate, communicate, accelerate locate, communicate, accelerate