Q3 2014 Presentation Vrnamo, November 4, 2014 Third quarter Who we - - PowerPoint PPT Presentation
Q3 2014 Presentation Vrnamo, November 4, 2014 Third quarter Who we are Bufab is a leading Supply Chain Partner . We provide C-Parts , covering everything from traditional fasteners to complicated processed and assembled components in
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Third quarter
Bufab is a leading Supply Chain Partner. We provide C-Parts, covering everything from traditional fasteners to complicated processed and assembled components in different materials, and services to the industry worldwide, providing solutions in manufacturing, quality, sourcing and logistics. Bufab’s offering – Global Parts ProductivityTM It helps our customers reduce total cost and complexity, free up capital, achieve stable quality and deliveries.
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Third quarter Established in 1977 Around 800 employees 30 wholly owned subsidiaries in 23 countries Approx 2 000 MSEK in turnover Headquarters in Värnamo, Sweden 120 000 articles Listed on the stock exchange 12 000 customers In-house production
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Over 120 000 C-Parts Global Supplier Network In-house Production
CUSTOMER SATISFACTION
Lower total cost Secured quality Reliable delivery Less complexity Focus on core
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Third quarter Sales growth Bufab’s goal is to achieve average annual organic growth over a business cycle exceeding the growth of the manufacturing industry in countries where Bufab is active by three percentage
+3 ppt
Profitability Bufab targets an average operating margin of 12 percent over a business cycle.
12 %
Capital structure Bufab’s capital structure shall provide a high degree of financial flexibility and make acquisitions possible. The net debt/equity ratio should not exceed 80%.
<80%
Net working capital Bufab’s long-term goal is to achieve a net working capital/net sales ratio of 30 percent.
30%
Dividend policy Bufab’s target is to pay 50 percent of its net profit in dividends. However, the company’s financial condition, cash flow, acquisition opportunities and future prospects will be taken into account in any dividend decision.
50%
ACCELERATED ORGANIC GROWTH IMPROVED EFFICIENCY VALUE-ADDING ACQUISITIONS
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Third quarter
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Quality and Customer First!
Accelerated organic
Growth
Improved cost/capital
Efficiency
Value-adding
Acquisitions
Customer Value Creation
Processes
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Third quarter Strong growth in a weaker market Order intake weaker than net sales Adjusted for currency translation 6.2 % Strategic initiatives showing result – higher market shares for segment International Weaker underlying demand
*Excluding IPO costs of 18 MSEK
Operating margin Positively affected by higher sales Negatively affected by higher costs for sales
Strong comparable Q3 2013
12 month rolling Quarter 3 Δ Jan-Sep Δ Full year Δ SEK millions 2014 2013 % 2014 2013 % 2013/14 2013 % Order intake 528 503 5.0 1,656 1 553 6.7 2,175 2,072 5.0 Net sales 536 490 9.4 1,667 1 519 9.7 2,178 2,031 7.3 Gross margin, % 28.4 28.2 29.5 29.0 29.7 29.3 Adjusted operating profit* 48 49
159* 148 7.8 214 203 5.7 Adjusted operating margin, % 8.9 10.1 9.5 9.7 9.8 10.0
3 6 9 12 15 500 1000 1500 2000 2500 Q3 2012 Q4 2012 Q1 2013 Q2 2013 Q3 2013 Q4 2013 Q1 2014 Q2 2014 Q3 2014 Margin, % LTM Net sales, SEK millions LTM Net sales 12 M, MSEK Adjusted Operating Margin 12 M, %
6 4 10 8 6
5 10 15 Q3 2012 Q4 2012 Q1 2013 Q2 2013 Q3 2013 Q4 2013 Q1 2014 Q2 2014 Q3 2014
Quarterly year-on-year net sales growth, %*
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Third quarter
*Adjusted for currency translation effects
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Third quarter Weaker order intake
manufacturing subsidiary Net sales in line with last year
production abroad which shows up in segment International, weaker demand Slightly weaker operating margin
12 month rolling Quarter 3 Δ Jan-Sep Δ Δ SEK millions 2014 2013 % 2014 2013 % 2013/14 2013 % Order intake* 212 237
736 757
977 998
Net sales* 220 218 1.2 752 727 3.5 995 970 2.6 Adjusted operating profit 29 31
117 103 13.3 157 143 9.6 Adjusted operating margin, % 13.3 14.3 15.5 14.2 15.8 14.8
*Pertains to net sales and order intake from external customers
5 10 15 20 500 1000 1500 2000 Q3 2012 Q4 2012 Q1 2013 Q2 2013 Q3 2013 Q4 2013 Q1 2014 Q2 2014 Q3 2014 Margin, % LTM Net sales, SEK millions Net sales LTM, MSEK Adjusted Operating Margin, %
3 6 2 1
5 10 15 Q3 2012 Q4 2012 Q1 2013 Q2 2013 Q3 2013 Q4 2013 Q1 2014 Q2 2014 Q3 2014
Quarterly year-on-year net sales growth, %
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Third quarter Order intake in line with net sales Strong sales growth Adjusted for currency effects 10.0% Strategic initiatives showing results Higher market shares Operating margin Positively affected by higher sales Negatively by higher cost for stronger sales organization Comparable earnings in 2013 positively impacted by better business mix as well as of revaluation items of 4 MSEK
12 month rolling Quarter 3 Δ Jan-Sep Δ Δ SEK millions 2014 2013 % 2014 2013 % 2013/14 2013 % Order intake* 316 267 18.5 921 797 15.6 1,198 1,074 11.5 Net sales* 316 272 15.9 914 792 15.4 1,183 1,061 11.5 Adjusted operating profit 23 27
63 64
82 83
Adjusted operating margin, % 7.3 9.8 6.9 8.1 6.9 7.8
*Pertains to net sales and order intake from external customers
0,0 5,0 10,0 15,0 20,0 500 1000 1500 2000 Q3 2012 Q4 2012 Q1 2013 Q2 2013 Q3 2013 Q4 2013 Q1 2014 Q2 2014 Q3 2014 Margin, % LTM Net sales, SEK millions Net sales LTM, MSEK Adjusted Operating Margin LTM, %
5 13 6 14 14 10
5 10 15 Q3 2012 Q4 2012 Q1 2013 Q2 2013 Q3 2013 Q4 2013 Q1 2014 Q2 2014 Q3 2014
Quarterly year-on-year net sales growth, %*
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*Adjusted for currency translation effects
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25,0% 30,0% 35,0% 40,0% 45,0% 50,0% 200 400 600 800 1000 Q2 2012 Q3 2012 Q4 2012 Q1 2013 Q2 2013 Q3 2013 Q4 2013 Q1 2014 Q2 2014 Q3 2014 As of % of net sales SEK millions Net Working Capital As of % of net sales
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Strong growth in a weaker market – increased market shares Order intake in Sweden weaker than net sales Margin somewhat weaker than strong Q3 2013 Increased earnings per share
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Quarter 3 SEK millions 2014 2013 Net sales 536 490 Cost of goods sold
Gross profit 152 138 Distribution costs
Administrative expenses
Other operating income 6 8 Other operating expenses
Operating profit Note 1 48 51 Profit/loss from financial items Interest and similar income Interest and similar expenses
Profit after financial items 42 41 Tax on profit of the period
Profit for the period 31 30
Third quarter
18 30-sep-14 30-sep-13 31-dec-13 SEK millions ASSETS Non-current assets Intangible assets 745 739 739 Property, land and equipment 144 130 145 Financial assets 25 26 25 Total non-current assets 914 895 909 Current assets Inventories 670 585 626 Current receivables 516 470 440 Cash and cash equivalents 94 97 98 Total current assets 1,280 1,152 1,164 Total assets 2,194 2,047 2,073 EQUITY AND LIABILITIES Equity 1,121 966 1,012 Non-current liabilities Non-current liabilities, interest bearing 600 507 479 Non-current liabilities, non-interest bearing 29 25 29 Total non-current liabilities 629 532 508 Current liabilities Current liabilities, interest bearing 86 203 227 Current liabilities, non-interest bearing 358 346 326 Total current liabilities 444 549 553 Total equity and liabilities 2,194 2,047 2,073
Third quarter
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Quarter3 Δ 2014 2013 % Order intake, SEK million 528 503 5,0 Net sales, SEK million 536 490 9,4 Gross profit, SEK million 152 138 10,1 Adjusted EBITDA, SEK million 56 57
Operating profit, SEK million 48 51
Adjusted operating profit, SEK million 48 49
Profit after tax, SEK million 31 30 3,0 Gross margin, % 28,4 28,2 Operating margin, % 8,9 10,4 Adjusted operating margin, % 8,9 10,1 Net margin, % 5,8 6,1 Net debt, SEK million 592 613
Debt/equity ratio, % 53 63 Net debt / adjusted EBITDA 2,4 2,7 Working capital, SEK million 828 709 Working capital / net sales, % 36,2 35,5 Equity/assets ratio, % 51 47 Operating cash flow, SEK million 34 46 Earnings per share, SEK 0,81 0,79
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Expected market growth for Supply Chain Partners in Europe of 6-7%
Fundamental trend for C-Parts supply chain solutions… …drive strong growth for Supply Chain Partners*
In-house production Direct sourcing from manufacturer Wholesaler Supply Chain Partner Today
* The total market growth for Supply Chain Partners in Europe is expected to be, on average, 6-7% per year in the years to come. Source: Company information.
% of direct material cost Expected growth in underlying European C-Parts market Expected growth premium for Supply Chain Partners in Europe
~6-7% ~4% ~2-3%
Expected total growth for Supply Chain Partners in Europe
Third quarter
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Strategy - Efficiency
Improved cost/capital
Efficiency
Logistics Productivity Consolidate Sourcing Common Tools & Processes
Third quarter
Case: Global leader in power and automation technologies
Global business together In 18 countries at 90 factories Bottom unit
2005 2013
”I believe that Bufab care about us, and that they would make that extra effort if needed” Geographical expansion 2005-2012
Started 2005 with 3 countries and 9 MSEK in sales 2013 Bufab delivered in 18 countries with sales of > 120 MSEK Started as supplier of commodity 2005 In 2013 Bufab provide wide range
Sales development 2005-2012