we engineer mission-critical technologies for ground-breaking industries and everyday life Baird's Global Industrial Conference Chicago, 6 November 2019 Wim Pelsma – CEO Aalberts N.V.
contents 1. Aalberts 2. Aalberts highlights 3. operational review 4. financial review 5. Aalberts looking forward 6. questions & answers
1. Aalberts
our essence we engineer mission-critical technologies for ground-breaking industries and everyday life we are a company of mission- critical people who can’t resist going beyond the line of duty - good is never good enough sharing and discussing ‘bad’ gets us to brilliant – greatness is made of shared knowledge we are relentless in our pursuit of excellence 6 November 2019 Aalberts N.V. | Baird's Global Industrial Conference 4
our way of value creation our essence shareholder value o leading niche technology positions mission-critical o high entry barriers, pricing power technologies o high added-value margins, sustainable growth o operational excellence good is never o improve EBITA margins, strong cash conversion good enough o disciplined capital allocation o technology exchange greatness is made of o innovation speed shared knowledge o fast learning & adaptation 6 November 2019 Aalberts N.V. | Baird's Global Industrial Conference 5
our track record – over 40 years of sustainable profitable growth multi-industry focus portfolio growth focus niche technology focus 3000 2,759 420 2500 370 revenue (in EUR million) 366 2,025 EBITA (in EUR million) 320 2000 270 1,440 1500 220 219 170 168 1000 120 474 500 70 130 59 0 20 1975-1981 1987 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 IPO promoted to foundation promoted to AEX index company AMX index focused technology leader, strongly positioned for accelerated future growth 6 November 2019 Aalberts N.V. | Baird's Global Industrial Conference 6
our track record - shareholder value creation share price long-term shareholders earnings per share dividend per share (> 3% holdings) (in EUR) (in EUR) (in EUR) 0.75 2.49 29.05 0.41 1.38 23.18 1.02 0.28 5.06 2008 2013 2018 2008 2013 2018 2008 2013 2018 CAGR 19% CAGR 9% CAGR 10% > 50% our relentless pursuit of excellence drives true shareholder value 6 November 2019 Aalberts N.V. | Baird's Global Industrial Conference 7
our key strength - mission-critical people the Aalberts way greatness is made of shared knowledge winning with people our unique advantage be an entrepreneur take ownership go for excellence share and learn act with integrity 6 November 2019 Aalberts N.V. | Baird's Global Industrial Conference 8
our strategy & objectives 2018-2022 strategy ‘focused acceleration' non-financial objectives financial objectives average organic remain improve worldwide leading niche focused technology positions revenue growth > 3% technology positions EBITA margin > 14% creating sustainable profitable growth ROCE > 18% free cash flow generating high conversion ratio > 70% added-value margins leverage ratio < 2.5 converting strong improve profitability use Aalberts operational execution continuously strengths solvability > 40% into free cash flow driven by entrepreneurship and a relentless pursuit of excellence 6 November 2019 Aalberts N.V. | Baird's Global Industrial Conference 9
our global leading niche technology positions installation technology material technology climate technology industrial technology we are where technology matters and real progress can be made 6 November 2019 Aalberts N.V. | Baird's Global Industrial Conference 10
our lean and effective structure digital Aalberts leadership team finance & IT business structure Aalberts networks stimulates business focus, entrepreneurship, fast learning and decision making 6 November 2019 Aalberts N.V. | Baird's Global Industrial Conference 11
innovation driving sustainable profitable growth continuous investments in R&D innovate portfolio & business leverage mega trends manufacturing rapid urbanisation automation 2.0 > 100 climate change resource scarcity EUR mio master data management globalisation > 400 co-development FTE connected technologies and digital services connectivity and integration R&D investments leadership networks and exchange fresh thinking and 4% of total revenue focused investments embrace new technologies our pragmatic culture and lean structure keep us ahead of the game 6 November 2019 Aalberts N.V. | Baird's Global Industrial Conference 12
our way of sustainable entrepreneurship Since our inception in 1975, Aalberts has always been where technology matters and real progress can be made. Humanly, environmentally and financially. impacting eco-friendly buildings, sustainable transportation, lifetime extension of materials and producing and consuming responsibly 6 November 2019 Aalberts N.V. | Baird's Global Industrial Conference 13
converting strong operational execution into free cash flow organic revenue growth added value margin EBITA EBITA margin (in %) (in %) (in EUR million) (in %) 366 13.3 62.6 4.6 11.0 10.4 60.0 225 182 58.0 1.2 -2.4 2008 2013 2018 2008 2013 2018 2008 2013 2018 2008 2013 2018 EPS free cash flow free cash flow conversion ratio cash flow from operations (in %) (in EUR) (in EUR million) (in EUR million) 2.49 427 312 67.6 287 1.38 61.6 265 175 155 1.02 57.6 2008 2013 2018 2008 2013 2018 2008 2013 2018 2008 2013 2018 generating high added value margins to invest in innovations and market opportunities 6 November 2019 Aalberts N.V. | Baird's Global Industrial Conference 14
disciplined capital allocation cash dividend policy 30% of net profit before amortisation organic growth CAPEX EUR 130-170 million p.a. acquisitions - bolt- on 'sweetspot’ deployment EUR 100-200 million p.a. size EUR 20-150 million annual revenue acquisitions - strategic footprint deployment EUR 100+ million (depending on opportunity) size EUR 150+ million annual revenue strengthening our worldwide leading niche technology positions 6 November 2019 Aalberts N.V. | Baird's Global Industrial Conference 15
return on incremental capital employed (ROICE) capital EBITA employed 2008 182 1,352 2018 366 2,262 Δ 184 910 20.2% ten-year ROICE demonstrating the sustainability of our long-term business model 6 November 2019 Aalberts N.V. | Baird's Global Industrial Conference 16
2. Aalberts highlights
Aalberts highlights innovations driving setup of digital new distribution and new generation of full flow valves district additional growth engineering services assembly centre NL, electronic regulators for energy, gas, residential, exceeded expectations worldwide expansion Belgium CNG passenger cars commercial buildings increased investments co-development projects opened renewed first long-term digital advantage of additive manufacturing new surface technologies extrusion hall with services contracts investments, earlier related processes for weight reduction upgraded equipment digital hubs FR & NL gained projects semicon we are where technology matters and real progress can be made 6 November 2019 Aalberts N.V. | Baird's Global Industrial Conference 18
Aalberts highlights revenue added-value (in EUR million) (% of revenue) organic revenue growth +3% o 1,436 63.3 operating profit (EBITA) +5% o +4% 1H2018: 62.8 EBITA margin improved to 13.1% o EBITA EBITA % (in EUR million) (% of revenue) 188 13.1 net profit before amortisation +6% o +5% 1H2018: 12.9 earnings per share +6% o net profit earnings per share CAPEX +26% to facilitate many organic growth, (in EUR million) (in EUR) o 138 1.25 innovation and efficiency initiatives +6% +6% bolt-on acquisition Precision Plating Company o capital expenditure ROCE (PPC), Chicago, USA (in EUR million) (in %) 72 14.4 cash flow from operations strong increase o +26% 1H2018: 15.2 solid performance due to unique market positions, innovation and organic growth initiatives, entrepreneurial strength and strong focused business teams 6 November 2019 Aalberts N.V. | Baird's Global Industrial Conference 19
3. operational review
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