Q1 2020 Presentation April 21, 2020 First quarter Q1 2020 in - - PowerPoint PPT Presentation

April 21, 2020

Q1 2020 Presentation

First quarter

Q1 2020 in Brief

• Sales up +21%
• 24% acquired, -5% organic and 2% currency. Order intake in line with net sales
• Lower underlying demand but unchanged market share
• All-time-high sales, order intake and operating profit. Strong cash flow.
• Overall, impact on of the COVID-19 pandemic was low in Q1, …
• …but in April demand so far is down by 30% due to customer closures and government

restrictions in Europe and North America.

• Forceful measures taken to protect Health, Customer Quality and Delivery, and

to meet lower demand in Q2

• Short-time work schemes and some layoffs – working time reduced by 30% in April
• Reduction all other cost and capex where possible
• Ready to take more measures if demand falls further
• Action program prioritises speed and retained flexibility

2

EBITA Q1 2019 119 Currencies

• 6

Volume

• 16

Price/cost/mix/other +5 Acquisitions +24 EBITA Q1 2020 126 3

First quarter

Financial highlights, Group

Quarter 1

Δ

12-months rolling Full year SEK million 2020 2019

%

2020/19 2019 Order intake 1,321 1,084

22

4,591 4,354 Net sales 1,316 1,091

21

4,573 4,348 Gross profit 351 304

16

1,230 1,183

% 26.7 27.9 26.9 27.2

Operating expenses

• 226
• 184

22

• 841
• 799

%

• 17.2
• 16.9
• 18.4
• 18.4

Operating profit (EBITA) 126 119

5

390 384

% 9.5 10.9 8.5 8.8

Profit after tax 86 84

3

255 253 Earnings per share, SEK 2.31 2.23

4

6.83 6.75

Financial development, Group

• 10
• 5

5 10 15 20 25

Percent

Quarterly Net Sales growth

Organic growth Total growth

50 100 150 200 250 300 350 400 450 500 500 1 000 1 500 2 000 2 500 3 000 3 500 4 000 4 500 5 000

LTM EBITA, SEK million LTM Net Sales, SEK millions Net Sales EBITA 4

First quarter

5

First quarter

Bufab’s priorities during Corona crisis

1

Protect

Health

(team, families, society—prove we’re Responsible Partner)

2

Protect

Customers

(deliveries, flexibility, troubleshooting—prove we’re Solutionists)

3

Protect

Bufab

(it’s where we work—prove we’re Entrepreneurs w/Big Hearts)

Protect… Health Customers Bufab

6

First quarter

In April, we are entering the second phase

Jan-March Secure health and delivery

Protect… Health Customers

April- Flexibly adapt to changing market

First quarter

Corona virus pandemic means tough Q2

7

Negative Impact

• n Q2 Sales

Strong Measures Taken, Flexibility Retained

• Demand in China sharply down in

February, but recovered in March

• From April on, substantial customer

closures and lockdowns in Europe and North America

• Some countries, industries harder

hit—diversification helps

• April started at -30% sales relative

normal levels

• Unclear how long effect will last
• Some customers restarting production

now or soon

• Development pandemic and

government action impossible to predict

• Thanks to actions taken, no

health, delivery or quality red flags

• Q3 -19 efficiency program intensified

(opex, capex, margin, NWC)

• Short-time work actions taken in

most subsidiaries to flexibly reduce work hours in line with sales

• April hours worked -30%

relative normal levels

• New government regulations and

support in many countries beneficial

• Focus on protection of key people,

customer relations, and flexibility

First quarter

New organisation for continued growth and improved efficicency

8

2  4 Operating Segments

To better reflect the Group’s international reach and

• pportunities, Sweden/International will be replaced by

West, North, East, and UK/North America

6 Regions 10 Business Units

To increase focus on growth opportunities and operational improvement, and to allow for future scalability, the existing 6 regions will be replaced by 10 business units

Efficiency project

• New organization fully operational
• Efficiency project launched in Q3 2019 aiming at

40 MSEK savings on full-year basis, intensified during Q1

• No significant restructuring costs incurred

First quarter

Segment North

• Good start for trading activity but lower demand towards end of March
• Weak performance in Demark and within furniture and fittings
• Producing units in Sweden noted a low demand, due to the automotive industry
• Gross margin down mainly attributable to recent acquisition
• EBITA improvement despite negative organic growth due to acquisitions and good cost control

9 Quarter 1

Δ

Rolling 12 months Full year SEK million 2020 2019

%

2020/19 2019 Order intake 565 451

25

1,980 1,866 Net sales 554 453

22

1,966 1,865 Gross profit 137 119

25

501 474

% 24.8 26.3 25.5 25.4

Operating expenses

• 82
• 69

19

• 313
• 300

%

• 14.8
• 15.2
• 15.9
• 16.1

Operating profit (EBITA) 56 50

11

180 174

% 10.1 10.9 9.1 9.3

Segment West

10

First quarter

• Strong start but demand weakened in the middle of the quarter
• Demand fell mainly in Germany, the Netherland and France and among customers within the automotive

industry

• Gross margin was significantly lower mainly due to a poorer business mix
• EBITA fell compared to a very strong comparison quarter in 2019, but improved sequentially

Quarter 1

Δ

Rolling 12 months Full year SEK million 2020 2019

%

2020/19 2019 Order intake 299 310

• 4

1,146 1,157 Net sales 301 308

• 2

1,148 1,155 Gross profit 75 84

• 10

297 306

% 25.1 27.3 25.9 26.5

Operating expenses

• 52
• 51

3

• 208
• 207

%

• 17.4
• 16.6
• 18.2
• 17.9

Operating profit (EBITA) 23 34

• 32

88 99

% 7.7 11.0 7.7 8.6

• First segment to be hit by the crisis
• Demand was weaker at the beginning of the quarter in China, but stronger at the end of the quarter
• Somewhat lower gross margin, but good cost control led to an unchanged EBITA

Segment East

11

First quarter

Quarter 1

Δ

Rolling 12 months Full year SEK million 2020 2019

%

2020/19 2019 Order intake 189 183

3

727 721 Net sales 189 185

2

727 723 Gross profit 59 58

1

231 230

% 31.0 31.4 31.7 31.8

Operating expenses

• 32
• 32
• 134
• 134

%

• 17.0
• 17.3
• 18.4
• 18.5

Operating profit (EBITA) 27 27

2

97 97

% 14.1 14.2 13.4 13.4

• Good start but substantially lower demand towards end of March when restrictions started
• Strong EBITA improvement mainly due to acquisition of American Bolt & Screw i November 2019

Segment UK/North America

12

First quarter

Quarter 1

Δ

Rolling 12 months Full year SEK million 2020 2019

%

2020/19 2019 Order intake 268 139

94

732 602 Net sales 272 143

90

727 598 Gross profit 85 45

89

225 185

% 31.4 31.8 31.0 30.9

Operating expenses

• 56
• 30

87

• 164
• 138

%

• 20.6
• 21.0
• 22.6
• 23.1

Operating profit (EBITA) 29 15

95

61 47

% 10.8 10.5 8.4 7.9

First quarter

Gross margin development

13

22,0% 24,0% 26,0% 28,0% 30,0% 32,0% Q2 19 Q3 19 Q4 19 Q1 20

Segment North

GP%-development

Segment North, excl. HT Bendix Segment North, as reported 22,0% 24,0% 26,0% 28,0% 30,0% 32,0% Q2 19 Q3 19 Q4 19 Q1 20

Group

GP%-development

Group, excl. HT Bendix & ABS Group, as reported

First quarter

Acquisitions since 2014

14

First quarter

EBITA Bridge

15

Q1 EBITA 2019 119 Currency

• 6

Volume

• 16

Price/cost/mix/other +5 Acquisitions +24 EBITA 2020 126 Q1 EBITA 2019 119 North +6 West

• 11

East +0 UK/North America +14 Group/Other

• 2

EBITA 2020 126

Outlook

Summary and outlook

First quarter: strong growth, improved profit and cash flow

• Limited effects of corona virus in Q1
• Drop in demand noted toward end of the quarter

Outlook:

• Challenging demand situation in Q2
• Comprehensive action program in place

Priorities 2020

• During Corona crisis: Protect Health, Customers and Bufab
• Continued focus on new business generation
• Continue building Leadership platform

16

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Q&A