THE WAY TO MAKE IT Half-year results and outlook 2014 19 August - - PDF document

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THE WAY TO MAKE IT Half-year results and outlook 2014 19 August - - PDF document

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THE WAY TO MAKE IT Half-year results and outlook 2014 19 August 2014 19 August 2014 / Half-year results and outlook 2014 / 1 Agenda THE WAY TO MAKE IT Half-year results 2014 Outlook Komax focussed on markets in the automation sector

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19 August 2014 / Half-year results and outlook 2014 / 1

Half-year results and outlook 2014

19 August 2014

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19 August 2014 / Half-year results and outlook 2014 / 2

Agenda

Half-year results 2014 Outlook Komax – focussed on markets in the automation sector

Komax Wire Komax Medtech

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19 August 2014 / Half-year results and outlook 2014 / 3

First half 2014 in brief

Strong first half of 2014

Revenues1 increased by 8.6% to CHF 171.6 million Operating profit (EBIT) from continuing operations at CHF 22.5 million maintained Group profit after taxes from continuing operations increased by 6.7% to CHF 21.0 million

Komax Wire

Net sales increased by 9.6% to CHF 139.9 million Internal growth of more than 6% Strengthening trend towards further automation in the field of wire processing EBIT margin in target area

Komax Medtech

Net sales on last year’s level EBIT maintained despite low capacity utilization at La Chaux-de-Fonds site

Komax Solar

Management buyout New company will start operations in second half 2014

1 Revenues from continuing operations.

Prior-year figures restated owing to application of IFRS 5. THE WAY TO MAKE IT

19 August 2014 / Half-year results and outlook 2014 / 4

internal growth acqui- sitions currencies Total

Order intake 184'536 176'186

  • 4.5%

Revenues2 157'917 171'573 5.9% 4.7%

  • 2.0%

8.6% Book-to-Bill 1.17 1.03 EBIT 22'696 22'539

  • 0.7%

in % of revenues 14.4% 13.1%

  • 0.6pp

Result from discontinued operations

  • 3'957
  • 12'728

221.7% EAT 15'708 8'254

  • 47.5%

in % of revenues 9.9% 4.8%

Free cash flow 12'041 10'023

  • 16.8%

Net cash first half 2014/31.12.2013 22'616 20'768

  • 8.2%

+/-

in TCHF

H1 20131 H1 20141

Key figures

1 Prior-year figures restated owing to application of IFRS 5. 2 Revenues: Net sales + other operating income.

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by segment Komax Wire 80% 80% Komax Medtech 20% 20% by region Switzerland 2% 3% Europe 44% 52% Africa 6% 8% North/South America 27% 18% Asia 21% 19% H1 2013 H1 2014

Distribution of net sales by segment and region

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12.3 1.5 H1 2013 Wire Medtech Corporate H1 2014

Net sales1 – growth in both business units

in CHF million

157.7 171.5 0.0

2

1 Net sales from continuing operations. 2 Prior-year figures restated owing to application of IFRS 5.

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9.1

  • 6.2
  • 0.2
  • 2.9

H1 2013 Material/revenues Personnel Depreciation Others H1 2014 Gross profit margin H1 2013: 61.5% Gross profit margin H1 2014: 62.0%

EBIT1 – gross profit margin slightly increased

22.7 22.5

2

1 EBIT of continued operations. 2 Prior-year figures restated owing to application of IFRS 5.

in CHF million

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19 August 2014 / Half-year results and outlook 2014 / 8

26.7 9.0

EBIT1 by segment – Wire and Medtech match previous year’s level

  • 0.3
  • 0.5

H1 2013 Wire Medtech Corporate H1 2014 0.6

2

in CHF million

22.7 22.5

1 EBIT of continued operations. 2 Prior-year figures restated owing to application of IFRS 5.

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19 August 2014 / Half-year results and outlook 2014 / 9

  • 40%
  • 20%

0% 20% 40%

Komax Wire – still strong

Order intake and net sales increased by around 10% Contribution of SLE around CHF 7.6 million EBIT on a high level Net sales growth in Europa, Africa und Asia Net sales by region

127.7 139.9 26.1 26.7 20.5% 19.1%

20 40 60 80 10 0 12 0 14 0 16 0 18 0

H1 2013 H1 2014 Net sales EBIT Margin in CHF million

Change from previous year

2% Switzerland 46% Europe 10% Africa 21% North/ South America 21% Asia Europe Africa North/ South America Asia Switzerland

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19 August 2014 / Half-year results and outlook 2014 / 10

Komax Medtech – on last year’s level

0% 40% 80% 120% 160% 200% 240% 280% Europe North/ South America

Net sales and EBIT at the same level as last year Unsatisfactory order intake in La Chaux-de-Fonds in second quarter Rockford and Penang robust

13% North/ South America 5% Asia 30.4 31.9 0.5 0.3 1.7% 0.8%

5 10 15 20 25 30 35 40 45 50

H1 2013 H1 2014 5% Switzerland 77% Europe Switzerland Asia

Change from previous year Net sales by region

Net sales EBIT Margin in CHF million

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Komax Solar – Management Buy-out (Asset Deal)

Result from discontinued operations (CHF million) Assets and liabilities classified as held for sale (CHF million) The “result from discontinued operations” includes non- cash expenditures for value adjustments for technology, goodwill and current assets in the order of CHF 8 million.

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19 August 2014 / Half-year results and outlook 2014 / 12

Agenda

Half-year results 2014 Outlook Komax – focussed on markets in the automation sector

Komax Wire Komax Medtech

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Outlook

For Komax Wire we are not expecting any substantial changes to the market environment in the second half, and are thus anticipating continued strong

  • performance. On the basis of the information currently available, we are expecting net

sales in the second half of 2014 to be broadly on a par with the first half. However, the economic climate for Komax Medtech has taken a turn for the worse. The business unit’s success in 2014 now depends substantially on more orders being booked in La Chaux-de-Fonds. The Group’s solar activities will be taken over by the present management team in the second half of the year. Until the definitive handover of the solar business, we are expecting a further negative contribution to the results in the second half.

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19 August 2014 / Half-year results and outlook 2014 / 14

Agenda

Half-year results 2014 Outlook Komax – focussed on markets in the automation sector

Komax Wire Komax Medtech

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19 August 2014 / Half-year results and outlook 2014 / 15

Group strategy geared to long-term profitable growth

Business Unit Revenues growth target EBIT margin target

Business Unit Wire 3 – 5% ~20% selective Business Unit Medtech

  • ~5%
  • Acquisitions

Targets implemented in March 2011, time horizon 3 to 5 years. Komax Medtech is in systems business, i.e. it mainly manufactures complex, customer specific systems. In this business, targeted selection of the projects to be acquired is more important than growth per se. THE WAY TO MAKE IT

19 August 2014 / Half-year results and outlook 2014 / 16

Agenda

Half-year results 2014 Outlook Komax – focussed on markets in the automation sector

Komax Wire Komax Medtech

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19 August 2014 / Half-year results and outlook 2014 / 17

Komax Wire – a highly attractive and profitable business

Marge

Key figures 2009 – H1 2014 Solutions for wire processing and harness and module testing

91.9 194.5 217.8 228.3 253.8 139.9

  • 3.0

47.8 57.1 52.7 47.4 26.7

  • 3.2%

24.6% 26.2% 23.1% 18.7% 19.1%

  • 1 00. 0%
  • 8 0.0 %
  • 6 0.0 %
  • 4 0.0 %
  • 2 0.0 %
0.0 % 20 .0%
  • 5 0
50 10 0 15 0 20 0 25 0 30 0

2009 2010 2011 2012 2013 H1 2014 Net sales EBIT in CHF million

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Strategy Komax Wire – capture potential

Growth along the value chain Global presence Innovation Complete solutions/new fields of application

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Komax Wire covers the most capital intensive stages of the value chain

Value chain wire harness manufactures (automotive industry) Net sales by industry

70-80% Automotive 20-30% Others

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19 August 2014 / Half-year results and outlook 2014 / 20

Automotive is the most important market for wire processing

Market segmentation by industry Around 60% of overall processed wires are applied in the automotive industry Characteristics of the automotive industry

  • High level of standardization
  • High number of units
  • High quality requirements
  • Dynamic and innovative

Automotive High-speed- data communi- cation Commodities Electric devices Others

Electronic based innovation cyle of the automotive industry

  • Vehicles networks and networking vehicles

as well as trend towards intelligent cars

  • Driver assistance and safety systems
  • Alternative driving systems

More and more equipment in cars Increasing level of automation in production

  • Increasing quality requirements
  • Miniaturization
  • Increasing labor cost

Increasing complexity of wire harnesses – growing importance of testing Demographic factors

  • Population growth
  • Growing middle class
  • Increase in individual mobility

Growth drivers for Komax Wire’s business

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  • 60
  • 40
  • 20

20 40 60 80 100 120 140 160 180 200

97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13

Above-average growth of Komax Wire

Komax Wire vs. automotive industry 1997 - 2013

Komax Wire net sales, CAGR 97 – 13: 4.2% Global cars produced, CAGR 97 – 13: 3.0% Global car sales, CAGR 97 – 13: 3.0% Basis 1997

Additional growth drivers Advance in new markets other than the automotive industry New concepts for automation/innovation Synergies from acquisitions (TSK, MCM and SLE) Continuously growing base of installed machines

  • Need for renewal
  • Spare parts and service business

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In addition, there is growth potential besides the automotive industry to be unlocked

Automotive High-Speed- data communi- cation Commodities Electric devices Others

Measures taken Marketing intelligence improved Business development established Market segmentation by industry Further investments to be expected in the future Product portfolio Product management Marketing and sales organization

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Market shares

Komax Wire Competitor 1 Competitor 2 Competitor 3 Competitor 4 Others

40% market share – Komax Wire is the leading company

Technological leadership Comprehensive product range – complete solution provider Global presence High level of innovation Success factors

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Komax Wire sets trends with innovative customer solutions which create value

VALUE ADDING PRODUCT DEVELOPMENT – KOMAX SOLUTIONS INTERNAL SOURCES Know how and competencies EXTERNAL SOURCES Customer needs and technological trends

Around 140 employees in R&D plus additional and 115 people for the engineering of customer- specific applications Optimization of the innovation process to better bridge interfaces Expenses for pure R&D – around 8% of revenues

Products launched

mci 765G Kappa 320/350 inkjet SQC ADC AEH-LS Bt 712 DS Bt 214 (HV) Komax 345 Komax CAO Kappa 322 Alpha 488S Alpha 356 FAKRA TE Smart Applicator Metronic EVO Imaje 9040 Gamma 263 Gamma 253 ims 295 BS bt 712

Selection of new products Internal and external sources for innovation

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19 August 2014 / Half-year results and outlook 2014 / 25

Examples – quality monitoring tools for guaranteeing process stability

Automatic Conductor Detector (ACD) Stripping Quality Check (SQC)

Good stripping Pulled strands Played strands

The fully automatic conductor detector (ACD) identifies even the slightest contact between blades and conductor strands, and removes any flawed conductor ends with no loss of machine performance. The stripping quality check (SQC) monitors stripping length and ascertains the presence of pulled or splayed strands. Here too, products identified as detective are automatically removed without any impact on performance.

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19 August 2014 / Half-year results and outlook 2014 / 26

Global presence offers great advantages

Komax production Komax sales and service TSK production TSK sales and service Sales representative

Global product portfolio locally adapted Quick response and short delivery times Geographic diversification

  • Economic cycles

Regional autonomy

  • Siting decision of OEMs and tier1-suppliers

respectively

Position in Asia strengthened

  • Shanghai site
  • Market entry in Japan
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Around 20% of revenues generated with services and spare parts

Installed base – around 20 000 machines

  • Spare parts and service business
  • Machine replacements

Service organization – around 80 employees globally Komax direct

Komax machines installed

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One stop shop – broad product range from a single source

Komax Wire – universal contact partner for all wire-processing challenge Standard machines and customer specific solutions Networking of machines, process flow and integrated quality monitoring and testing tools (complete solution) Products of partners Unique network with partners

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Agenda

Half-year results 2014 Outlook Komax – focussed on markets in the automation sector

Komax Wire Komax Medtech

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19 August 2014 / Half-year results and outlook 2014 / 30

Strategy Komax Medtech – profitability is the top priority

Development of additional niche markets Focus on self-medication Profitability

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A structured approach from the concept to high volume production

Market shares

Komax Medtech Competitor 2 Competitor 3 Competitor 4 Competitor 1

Value chain

Others

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19 August 2014 / Half-year results and outlook 2014 / 32

Focus on self-medication and repeat business, and …

point of care (T&D) injection inhalation

DC fertility pens pumps syringes PMDI DPI BAI

Komax Medtech product portfolio T&D: test and diagnostics; DC: disposal cartridge; PMDI: pressurized metered dose inhaler; DPI: dry powder inhaler; BAI: breath actuated inhaler

Self-medication

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19 August 2014 / Half-year results and outlook 2014 / 33

… in addition new markets in assembly automation are going to be developed

Use of existing standards

  • Modules and standardized interfaces
  • Multiplication of existing processes

Use of existing platforms

  • KSL (linear platform) and KSD (rotary platform)
  • For prototypes and small lots

Focus on large customer projects with repeat potential

  • Customer support from prototyping and low-volume-lines to

multiple high-volume-lines

  • For instance, assembly of printer cartridges for HP

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19 August 2014 / Half-year results and outlook 2014 / 34

Contact/Financial calendar

Financial calendar Contact Marco Knuchel Industriestrasse 6 6036 Dierikon Switzerland Phone +41 41 455 06 16 marco.knuchel@komaxgroup.com www.komaxgroup.com First Information

  • n the year 2014

20 January 2015 Annual media conference/ analysts’ presentation 2014 24 March 2015 Annual General Meeting 8 May 2015 Half-year results 2015 18 August 2015

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Disclaimer

This presentation contains forward-looking statements in relation to Komax which are based on current assumptions and expectations. Unforeseeable events and developments could cause actual results to differ materially from those anticipated. Examples include: changes in the economic and legal environment, the outcome of legal disputes, exchange rate fluctuations, unexpected market behaviour on the part of

  • ur competitors, negative publicity and the departure of members of management. The

forward-looking statements are pure assumptions, made on the basis of information that is currently available.

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19 August 2014 / Half-year results and outlook 2014 / 36

Half-year results and outlook 2014

19 August 2014