Analysts meeting Interim results 2014 Kendrion N.V. Agenda

Transcription

1 Analysts meeting Interim results 2014 Kendrion N.V. Piet Veenema / Frank Sonnemans Thursday, 21 August 2014 Agenda 1. Kendrion at a glance 2. Key figures first six months of Highlights first six months of Review of the Division Industrial 5. Review of the Division Automotive 6. Financial position and results 7. ERP project HORIZON 8. New auditor 9. Outlook 2 1

2 1. Kendrion at a glance 3 The Kendrion organisation KENDRION N.V. Development, production and marketing of high-quality electromagnetic and mechatronic components 2,900 employees (including more than 100 temps) in 15 countries Revenue: approximately EUR 400 million Listed company on NYSE Euronext's Amsterdam Market 4 2

3 Kendrion breakdown of revenue HY Global activities Kendrion 6 3

4 Kendrion committed to being a high-performer in niche markets Mission Strategy Objectives To develop business units that have strong international market positions in selected business-to-business niche markets and are market leader whenever possible Spearheads - Niche market leadership - Organic growth in the current operations - Utilisation of synergy in and between the business units - Balanced spread of the operations - Enhancement of flexibility in the organisation - Targeted add-on acquisitions - Enhancement of the innovative capacity - Corporate Social Responsibility and Sustainability Organic growth > 10% ROS > 10% ROI > 17.5% 7 Kendrion's strategy - A clearly defined profile of a multinational, fast-growing high-tech company - Building leading positions in business-to-business niche markets - With a well-balanced spread of activities and risks - With activities around the globe - With enhancement of innovation capacity - With strong financial targets 8 4

5 Strategy update - New Mid-term Plan "Designed to grow" - Turnover target 2015: EUR million - Achievement of financial objectives (costs and cash) - Expansion of the business in especially USA and China ("Breaking out of Europe") - Targeted acquisitions with industrial focus - Focus on "green"; new label "greensigned by Kendrion" - Increasing focus on mechatronic systems 9 2. Key figures first six months of

6 Key figures (x EUR 1 million unless otherw ise stated) Q Q Difference in % Revenue % EBITA % Net profit % ROS 8.3% 6.9% (x EUR 1 million unless otherw ise stated) HY HY Difference in % Revenue % EBITA % Net profit % ROS 8.1% 6.9% 1 The quarterly and interim figures are unaudited 2 Normalised for non-recurring costs in HY related to the Kuhnke acquisition (EUR 1.8 million), and a non-recurring tax gain of EUR 1.6 million Highlights first six months of

7 Highlights for the first six months of Good market conditions during the first half of the year - Highest quarterly turnover in electromagnetic components ever in Q2 - Strong organic growth, especially in Q2 (11.2%) - Further profit improvement (EBITA 8.3% in Q2) - Strong improved performance of Kuhnke - Steps made in the "Breaking out of Europe" strategy (China, USA) - First successes towards more mechatronic components and systems - New finance arrangement 13 Turnover development (in EUR million) 14 7

8 Status integration Kuhnke - Financially, legally and managerial integration finished - New business unit structure successful (entrepreneurship, speed) - More efficiency, strong reduction of number of employees (-70) - Improvements in manufacturing and warehouses - Split of Romanian activities, extension of the industrial activities - Good cooperation with the other business units 15 "Breaking out of Europe" (1/2) - Industrial in China - Plant in Suzhou will now focus on industrial activities - New orders (a.o. lifts) will lead to further growth - Industrial in the USA - Plant in Mishawaka (Indiana) grows slowly - Sales and marketing activities will be intensified - For a real breakthrough we have a lack of scale 16 8

9 "Breaking out of Europe" (2/2) - Automotive in China - New plant in Nanjing - New automotive orders/projects - Strong growth in the coming years - Automotive in the USA - Good developments of Kendrion Shelby - New orders, a.o. damper business - Strong growth in the coming years 17 First successes towards more mechatronic components and systems, some examples Mechatronics device for locking of the safety bracket of ski lifts Mechatronics device for adjusting organ registers with positive feedback to organist Door locking system 18 9

10 4. Review of the Division Industrial 19 Turnover Division Industrial per business unit 20 10

11 Locations of the Division Industrial Kendrion (Villingen), Germany Kendrion (Donaueschingen /Engelswies), Germany Kendrion Kuhnke, Germany Kendrion Kuhnke, Sweden Kendrion (Switzerland), Hausen am Albis Kendrion (Linz), Austria IDS IMS ICS ICS IMS IMS Kendrion (Mishawaka), USA IMS IDS Kendrion (Aerzen), Germany IMS ICS IDS Kendrion (Donaueschingen /Engelswies); Kendrion (Villingen), Italy IMS IDS IDS IMS ICS Kendrion (Suzhou), China Kendrion (UK), Bradford Kendrion Kuhnke, Spain Kendrion Kuhnke, Romania 21 General remarks Division Industrial (1/2) - Overall good development of our industrial activities - Excellent performance IDS - Good integration of ICS (Kuhnke) - Slow down at a few customers (IMS) because of stock reduction activities - German markets (machine construction) are developing well - Organic growth in Q2 2014: 6.5% (HY1 2014: 6.1%) - ROS HY1 2014: 7.9% (HY1 2013: 6.5%) 22 11

12 General remarks Division Industrial (2/2) - Start of several new projects in HY (Germany, China, USA) - Special attention in HY to further focus of our Chinese plant - Also in HY transfer of German activities towards our Romanian plant (new building is ready) Review of the Division Automotive 24 12

13 Turnover Division Automotive per business unit 25 Locations of the Division Automotive Kendrion (Villingen), Germany Kendrion (Markdorf), Germany Kendrion Kuhnke, Germany Kendrion Kuhnke, Romania Kendrion (Prostejov), Czech Republic Kendrion (Eibiswald), Austria PCS CVS HDS ACS ACS PCS PCS Kendrion (Shelby), USA HDS PCS CVS PCS Kendrion (Nanjing), China CVS CVS Kendrion (Mexico), Mexico HDS Kendrion (Suzhou), China CVS Kendrion (Sao Paulo),Brazil Kendrion (Pune), India 26 13

14 General remarks Division Automotive (1/2) - High level of activity in the worldwide automotive markets - Good integration of ACS (Kuhnke), ongoing focus and efficiency measures - Strong improvement of turnover and results of all four business units - Organic growth in Q2 2014: 13.7% (HY1 2014: 10.3%) (mainly caused by projects started in HY2 2013) - ROS HY1 2014: 8.7% (HY1 2013: 7.1%) 27 General remarks Division Automotive (2/2) - Damper project will be extended towards the USA, start in Europe in Q New valve projects in Germany will start in HY and in New projects for the Chinese market, start in Growth will continue in the coming years - Stagnation in India continues, Brazil and Mexico are developing well 28 14

15 6. Financial position and results 29 Financial results (x EUR 1 million unless otherw ise stated) Q Q Difference in % Revenue % EBITA % Net profit % ROS 8.3% 6.9% (x EUR 1 million unless otherw ise stated) HY HY Difference in % Revenue % EBITA % Net profit % ROS 8.1% 6.9% 1 The quarterly and interim figures are unaudited 2 Normalised for non-recurring costs in HY related to the Kuhnke acquisition (EUR 1.8 million), and a non-recurring tax gain of EUR 1.6 million 30 15

16 Financial position - In control of working capital - Investments HY EUR 9.9 million; FY 2014 > EUR 20 million - Free cash flow in HY /- EUR 0.2 million (HY1 2013: -/- EUR 8.4 million) - Good free cash flow expected for FY Solvency 40% - New credit facility agreement - > EUR 100 million available for acquisitions 31 New credit facility arrangement - New EUR 150 million credit facility - ING Bank, Deutsche Bank and BNP Paribas - 5 years, no repayments - Accordion option of EUR 75 million - Possibility to attract additional alternative sources of debt funding - Interest cover > 4.0; debt cover < Flexible - Strong cost reduction 32 16

17 7. ERP project HORIZON 33 ERP project HORIZON - Running according to plan - Kendrion (Shelby) conversion almost finished - ICS and ACS (former Kuhnke entities): conversion in Q

18 8. New auditor 35 New auditor - New auditor needed because of Dutch legislation - Careful selection process - Deloitte selected, effective 2015 financial year - KPMG will step down after 2014 financial year 36 18

19 9. Outlook 37 Outlook - Good economic circumstances in our home markets - Worldwide international developments uncertain - Several new projects will start in HY and in Growth therefore will continue in the coming years - Planned start-up costs in HY will slightly affect the EBITA margin in HY No concrete outlook 38 19

20 We magnetise the world! 20