RTX TELECOM COMPANY PRESENTATION Q2 2010/11

Transcription

1 RTX TELECOM COMPANY PRESENTATION Q2 2010/11 Nordea Markets, May 2011 By Jesper Mailind, President & CEO Jacob Vittrup, CFO

2 AGENDA Introduction to RTX Telecom Financials Q2 2010/11 Business areas Outlook 2

3 RTX IN BRIEF WIRELESS SOLUTIONS FOR GLOBAL CUSTOMERS RTX Telecom designs, develops and produces advanced wireless solutions for global customers 3

4 FACTS ABOUT RTX TELECOM ADDING WIRELESS WISDOM Founded 1993 Listed on the Copenhagen Stock Exchange in 2000 Over 700 wireless development projects completed Average telecom experience per engineer: >10 years Headquartered in Denmark with offices in Hong Kong and USA Approximately 170 employees 4

5 KEY CAPABILITIES DEVELOPMENT OF ADVANCED WIRELESS SHORT RANGE SYSTEMS SOLID TECHNOLOGY KNOWLEDGE EXPERIENCED WIRELESS ENGINEERING EXPERTS RF & Antenna Design Embedded SW Development Baseband & Electronics Acoustic Design Test Scripts & Test Systems Project Management IN-HOUSE STATE-OF-THE-ART LABS EXCELLENT PRODUCT REALISATION SKILLS Prototype Manufacturing Acoustics Lab EMC Lab Specification Design & Development Integration European Design Far-East Production Experts in Design for Manufacturing Production Test Systems Test & Certification Production Product vision OEM/ODM product 5

6 AGENDA Introduction to RTX Telecom Financials Q2 2010/11 Business areas Outlook 6

7 PERFORMANCE HIGHLIGTS Q2 2010/11 Revenue of DKK 52.1 mio. decreased by 10.4% composed by a decrease in RTX Products and an increasein RTX Technology Gross margin improved to 58.7%, up from 51.9% Still focus on business development by investments in R&D EBIT of DKK 3.8 mio. Positive cash flow from operations DKK 8.5 mio. Up 77% from DKK 4.8 mio. The full effect of the refocused business is reflected in profit after discontinued business 7

8 BUSINESS HIGHLIGHTS Q2 2010/11 Increasing global business activity reflects on RTX Technology order book Improved contribution margin, driven by mix and focus on higher margin products/projects Slower market launch of new VoIP system with a major customer pushes majority of new VoIP revenue to Q4 Good traction in new Technology business development areas 8

9 INCOME STATEMENT Q2 2010/ / /10 m DKK Q2 Q2 Net Revenue 52,1 58,2 Gross Profit 30,6 30,2 Gross Margin 58,7% 51,9% Staff, other cost, value of own work and depreciations -26,8-26,1 EBIT, continuing operations 3,8 4,1 Net financial items -0,3 0,4 Taxes, continuing operations -0,5-0,1 Profit from discontinued operations -0,2-3,1 Profit for the period 2,8 1,3 9

10 INCOME STATEMENT ACCUMULATED Q2 2010/ / /10 m DKK Q1 Q2 H1 Q1 Q2 H1 Net Revenue 39,4 52,1 91,5 46,1 58,2 104,3 Gross Profit 24,1 30,6 54,7 25,5 30,2 55,7 Gross Margin 61,2% 58,7% 59,8% 55,3% 51,9% 53,4% Staff, other cost, value of own work and depreciations -25,2-26,8-52,0-24,3-26,1-50,4 EBIT, continuing operations -1,1 3,8 2,7 1,2 4,1 5,3 Net financial items 0,8-0,3 0,5 0,5 0,4 0,9 Taxes, continuing operations 0-0,5-0,5 0,2-0,1 0,1 Profit from discontinued operations -2,1-0,2-2,3-2,1-3,1-5,2 Profit for the period -2,4 2,8 0,4-0,2 1,3 1,1 10

11 INVESTMENTS IN R&D FIRST HALF YEAR 2010/11 INVESTMENTS IN OWN R&D AREAS: Ultra Low Energy project New platforms within: VoIP based telephone system Enterprise platform Skype related product Test systems / test equipment 11

12 DEVELOPMENT COSTS CONTINUING OPERATIONS Q2 2010/ /10 m DKK Q1 Q2 H1 Q1 Q2 H1 Incurred development cost 7,0 7,5 14,5 1,3 1,7 3,0 Capitalisation, new products -3-4,3-7, Depreciations on development projects Development cost in the income Statement 4,0 3,2 7,2 1,3 1,7 3,0 12

13 BALANCE SHEET ACCUMULATED Q2 2010/11 Significantchanges in working capital: Positive change in receivables and inventories Net interest bearing debt improved withdkk 15.3 mio. compared to Q2 last year Capital structure: Non-leverage m DKK 31 March Sept March 2010 Assets Total intangible assets 18,0 10,6 8,1 Total tangible assets 78,4 78,8 80,4 Other longterm assets 0,3 0,3 0,9 Inventories 8,2 13,3 28,3 Receivables 40,7 57,2 61,3 Short-term current asset investments 45,9 48,0 64,9 Cash at bank and in hand 22,5 23,4 5,7 Total assets 214,0 231,6 249,6 Liabilities Equity 144,9 145,2 162,1 Long term liabilities 18,5 19,4 21,1 Short term liabilities 50,6 67,0 66,4 Total liabilities 214,0 231,6 249,6 Net interest bearing debt -49,1-47,1-33,8 13

14 CASH FLOW ACCUMULATED Q2 2010/ / /10 m DKK Q1 Q2 H1 Q1 Q2 H1 Cash flows from operations 3,6 8,5 12,0 4,8 4,8 9,6 Cash flows from investments -15,2 9,1-6,1 0,7-0,1 0,6 Cash flows from financing activities -0,5-0,6-1,1-0,5-0,6-1,1 Cash flows from discontinued operations -2,1-0,2-2,3-2,1-3,1-5,2 Change in cash and cash equivalents -14,3 16,8 2,5 2,9 1,0 3,9 14

15 AGENDA Introduction to RTX Telecom Financials Q2 2010/11 Business areas Outlook 15

16 RTX BUSINESS UNITS FOCUS & REFERENCES RTX TELECOM A/S RTX TECHNOLOGY RTX PRODUCTS R&D engineering partner for wireless solutions Specialists in low-power wireless Denmark / San Jose (US) Wireless handsets for PBX systems Enterprise & SME IP/DECT VoIP solutions Skype & SIP cordless telephones Denmark / Hong Kong 16

17 REVENUE PER SEGMENT HALF YEAR 2010/ / /10 m DKK H1 H1 Change Technology 33,1 30,7 8% Products 56,5 69,8-19% Other 1,9 3,8 Total 91,5 104,3-12% 17

18 RTX TECHNOLOGY BUSINESS HIGHLIGHTS Revenueincreasedby 7.7% in firsthalf year compared to last year Increased activity driven by customers product roadmap investments Booking level and order value per contract is going up Several contracts with new customers First design-wins from business development activities RTX-T ODM supply minimally influenced by Japan situation so far! 18

19 RTX TESTERS A GENERIC & MODULAR TEST PLATFORM Profession & Industry Office & Enterprise Residential & consumer APPLICATION: BOARD LEVEL TEST/FINAL LEVEL TEST (E.G. WIFI, 3G, BLUETOOTH) Increased interest and need among Asian EMS sfor test equipment and processes driven by increasing labor costs Positive indications from a number of EMS s in Asia RTX2300 in market tests; market launch is under preparation Source: Frost & Sullivan Research,

20 LOW POWER WIRELESS PROGRAM GROWTH AHEAD FOR RTX TARGET MARKETS The market for Low Power Wireless Devices will grow substantially in the next decade: IN HOME AUTOMATION IN HEALTHCARE IN SMART METERING World Market for Residential Automation Devices with Low-Power Wireless (000's units) World Market for Consumer Health Devices with Low-Power Wireless (000's units) World Market for Meter Devices (000's units) 20

21 LOW POWER WIRELESS PROGRAM INITIATIVES AND FUNDING PARTIALLY FUNDED BY EU S EUROSTARS PROGRAM RTX INVESTS IN A LOW POWER WIRELESS PLATFORM Wireless technologies: DECT ULE, , Low Power WiFi and Bluetooth Low Energy Participation in industry groups to promote Low Power Wireless Technologies: Chairmanship DECT Forum sub-commitee (DECT ULE Working Group) to drive industry acceptance Participation in ETSI to drive specification ensuring an industry standard and interoperability ESMIG participation to promote wireless technologies within Smart Metering Driving 6LoWPAN specification (IPv6 in sensors/end nodes) within IETF Joint development with leading IC manufacturers/dialog Semiconductor PLC Wide range of Low Power Wireless platforms ready for deployment in Q3/11 Low Power Wireless development program continues into

22 RTX PRODUCTS BUSINESS HIGHLIGHTS Revenue decreased by 19.1% IP solutions in Set Top Box market is growing faster than expected Q1 last year included launching volume of Skype Contribution margin improved by focus on higher margin products Continuous investment in new platforms Significant customer interest for new IP DECT VoIP systems for the SME market Increased focus on supply chain after earthquake in Japan 22

23 ENTERPRISE MARKET Enterprise PBX SME VOIP Other Wireless Supplies started to Alcatel-Lucent of existing ruggedized handsets New enterprise handset range in development at 4 price points. High interest from several enterprise partners +8% +23% Entry level Mid end Touch screen Ruggedized 23

24 PBX MARKET PARTNERS Enterprise PBX SME VOIP Other Wireless SME HOSTED PBX: Polycom Aastra SOHO HOSTED PBX: Gigaset SNOM Panasonic Aastra Mitel US Market Potential Number of Employees Excl. Government ENTERPRISE PBX: Cisco Avaya/Nortel NEW Alcatel-Lucent NEC Siemens Aastra Mitel Ascom Panasonic Samsung Source: 2007 County Business Patterns and 2007 Economic Census. 24

25 SME MARKET NEW VOIP Enterprise PBX SME VOIP Other Wireless VOIP / SME New VoIP system finished for Beta test in April Significant interest by local/regional distributors of hosted PBX Several customers have signed up One major PBX customer for North America European/Australian distribution established 25

26 OTHER WIRELESS SKYPE Enterprise PBX SME VOIP Other Wireless New distributor, Chat & Vision, with presence in 50 countries started in Q1/11, with substantial marketing push. Entry into further markets (India) under investigation New Skype phone development initiated 26

27 FOCUS FOR 2010/2011 LAUNCH OF NEW AND INNOVATIVE PRODUCTS IP Dect VoIP system for SME market Dongle for cordless telephony via broadband gateways Integrated test solution for testing of wireless products - Launch Q3/Q4 -? - In preparation for launch INCREASE IN R&D INVESTMENTS New product platforms New wireless applications and ULE GROW SALES BY BROADENING MARKET REACH Build distribution on IP Dect VoIP system Increase distribution of Skype Telephone Broaden design business sales through manufacturers representative channel BUSINESS PROCESSES Cash & working capital Systems & processes to sustain controlled growth Risk management processes - In progress - In progress 27

28 IMPORTANT NOTICE This presentation contains statements regarding expectations for the future development of RTX Telecom A/S ( RTX Telecom or the Company ), in particular the direction of future product development, future sales, operating profits and business expansion. Such statements are subject to risks and uncertainties as various factors, many of which are outside the control of RTX Telecom, may cause the actual development and results to differ materially from the expectations expressed directly or indirectly in this presentation. Factors that might affect such expectations include, among others, rapid technological changes and evolving markets, overall economic and business conditions, fluctuations in currencies, demand for RTX Telecom s services, competitive factors in the market and uncertainties concerning possible investments. 28

29 OUTLOOK NEW GUIDANCE FY 2010/11 m DKK Outlook 2010/11 Q1 2010/11 Outlook 2010/11 Q2 2010/11 Net revenue EBIT, continuing operations EBIT, discontinuing operations (2)- (3) (2)-(3) 29

30 RTX TELECOM A/S QUESTIONS... CONTACT Jesper Mailind, CEO Tel