Bilfinger Se · XETR:GBF
Bilfinger — Non-Deal Roadshow (January 2018)
38 slides from Bilfinger's roadshow presentation, January 2018
Slide 1: Bilfinger SE Company Presentation
Bilfinger SE Bilfinger SE Company Presentation January 2018
Slide 2: Overview
Overview
Slide 3: Bilfinger at a glance
Bilfinger at a glance Leading international industrial services provider Efficiency enhancement of assets, ensuring a high level of availability € 4.2bn output volume and reducing maintenance costs Clear 2-4-6 strategy with two divisions, four regions and six industries thereof recurring busin
Slide 4: Back to Profitable Growth: 2 Service Lines, 4 Regions, 6 Industries
Back to Profitable Growth 2 Service Lines, 4 Regions, 6 Industries Our ambition We engineer and deliver process plant performance 2 Service Lines 4 Regions 6 Industries • E&T – Engineering & • Continental Europe • Chemicals & • Pharma & Where to play Technologies • Northwest Europe Petrochem Biophar
Slide 5: Service Portfolio
Service Portfolio Strong offering for capex and opex driven services E&T – Engineering & Technologies OPEX Packaged Units Turnarounds Efficiency Modifications Maintenance Expansions Operations Plant Expansions Emissions Maintenance Contracts CAPEX MMO – Maintenance, De-Sulfurizations Modifications &
Slide 6: Go-To-Market organization
Go-To-Market organization Market focus, customer centric E&T – Engineering & MMO – Maintenance, Technologies Modifications & Operations 6 industries Planning Oil & Gas Continental Europe International Regional Chemicals & Petrochem Execution Northwest Europe Energy & Utilities Pharma & Biopharma Tec
Slide 7: New organizational setup supports strategy implementation and 2020 ambition
New organizational setup supports strategy implementation and 2020 ambition E&T MMO In every region: • Concentrated know-how • Customer proximity • Centralized project governance • Management of capacity utilization • Leverage high-value resources • More collaboration and cross selling • Enables fas
Slide 8: Raising the growth potential
Raising the growth potential
Slide 9: Industrial service market: Continuous growth of operating plants
Industrial service market Continuous growth of operating plants • Number of plants in our defined markets growing constantly Number of plants in our markets 45k • More than 75% of plants are over 10 years old and number 12k of ageing plants increasing 32k • Complexity of plants is increasing with po
Slide 10: Bilfinger Market Model: Contracted out market is USD 125 bn and rising
Bilfinger Market Model Contracted out market is USD 125 bn and rising Total service market (2-4-6) Contracted out market (2-4-6) Contracted out market by regions and [USD bn] [USD bn] industries (2016) Northwest Europe Middle East 2.6% 256 231 Regions Continental Europe 110 E&T 98 +2.9% 3.4% 143 Nor
Slide 11: Driving profitable growth
Driving profitable growth Three major growth levers for above market profitable growth Comparison of growth rates Growth levers and growth impact [CAGR 2016-2020 in %] In line with market Above market Outpace market Continental Northwest North More than 20 growth Middle East initiatives detailed, Eu
Slide 12: Our analysis for sustainable and profitable growth
Our analysis for sustainable und profitable growth Our market What we are How to win $ 125 bn CAGR ~3.4 % 2-4-6 Market Focus & Customer Centric People, engineering, credentials, customer proximity, innovation >5 % top line CAGR1 1 CAGR 2017-2020 in % Bilfinger SE | Company Presentation | January 201
Slide 13: Improving our financial performance
Improving our financial performance
Slide 14: Ambitions will be achieved in three stages
Ambitions will be achieved in three stages Value Build out Build up Stabilization Time What does it mean in numbers? How will we execute? How will we measure and report progress? Bilfinger SE | Company Presentation | January 2018 Page 14
Slide 15: Margin ambition is supported by an extensive profit-pool analysis
Margin ambition is supported by an extensive profit-pool analysis Adjusted EBITA margin Profit pool according to FY 2016 Bilfinger profile1 (Mix FY 2020) • E&T with a defined path to improve profitability 5 to 9% E&T E&T • Entering blended margin range towards the end of the planning period EBITA •
Slide 16: We will address all P&L line-items
We will address all P&L line-items GROSS MARGIN • LOA1 process • Project management Impact on gross margin: ~200bps AMBITION2 ADDRESSING BOTH LINE ITEMS EBITA margin • Process and IT harmonization increase of • Procurement ~500bps by 2020 Impact on SG&A RATIO SG&A ratio • Lean headquarters ~300bps •
Slide 17: Current Trading and Guidance FY 2017
Current Trading and Guidance FY 2017
Slide 18: Q3 2017: Progress in stabilization
Q3 2017: Progress in stabilization Orders received: organic increase, book-to-bill >1 Output volume: organic growth after 13 quarters of decline Adjusted EBITA: at prior-year level, improvement in E&T Liquidity: ~€60 million from Doha obtained after the reporting date Outlook 2017: Earnings confirme
Slide 19: Market Situation E&T
Market Situation E&T Oil and gas: • Continued cautious investment sentiment in the European project business • Positive dynamic in selected areas such as gas supply and gas pipelines in Europe and Middle East Chemicals and petrochemicals: • Market growth in North America with focus on the US Gulf Co
Slide 20: Market Situation MMO
Market Situation MMO Oil and gas: • Customers keeping OPEX budgets at low level despite a higher oil price, i.e. increase in demand for maintenance not expected before second half of 2018 • Continuing intensely competitive environment Chemicals and petrochemicals: • Stable demand in Europe in the ma
Slide 21: Progress in orders received, book-to-bill >1
Progress in orders received, book-to-bill >1 Development of orders received • Orders received: +11%/+16% 11% above prior-year (org.: 16%) supported by larger orders 1,069 988 1,054 Orders 947 928 and catch-up effects in received 816 711 825 framework contracts 810 691 (€ million) (76%) (74%) (72%) (
Slide 22: Organic growth in output volume after 13 quarters of decline
Organic growth in output volume after 13 quarters of decline EBITA adjusted at prior-year level Development of output volume and profitability -2%/+3% • Output volume: 1,058 -2% (org.: +3 %) 1,020 958 990 998 • EBITA adj. Output 0% (org.: +1 %) volume 2.1% 2.1% 0.7% On prior-year level (€ million) -
Slide 23: Outlook FY 2017: Earnings confirmed, output volume better than expected
Outlook FY 2017: Earnings confirmed, output volume better than expected Starting Point Outlook in € million FY 2016 expected FY 2017 Orders received 4,056 Organic increase Output volume 4,219 Organic decrease <5% Adjusted EBITA 15 Break-even* *Assumption: on a comparable F/X basis Bilfinger SE | Com
Slide 24: Targets 2020 and Wrap-up
Targets 2020 and Wrap-up
Slide 25: Start of share buyback program in September 2017 as planned
Start of share buyback program in September 2017 as planned • Successful refinancing of syndicated cash-credit line (RCF) in June with volume: €300m; duration: 5 years Re- • Agreements on guarantee facilities in bilateral tranches with a total volume of €860m achieved financing • Conditions slightly
Slide 26: Bilfinger 2020: Ambition will be reached in three phases
Bilfinger 2020 Ambition will be reached in three phases with clear milestones Value Stabilization Build up Build out • Strategy defined • Top line growth resumed • Process and System • Organization announced • First successes in new growth areas harmonization fully rolled out • Execution master
Slide 27: Bilfinger 2020 Financial ambition
Bilfinger 2020 Financial ambition Organic Growth Profit Cash Return • Positive adj. FCF at the • EBITA adjusted ~5% Post-tax latest from 2018 onwards • Gross margin ROCE2 reported: >5% CAGR • Over the cycle, from 2018 improvement by ~200bps 8 to 10% based on FY 2017 onwards: Cash Conversion • SG&A r
Slide 28: The Bilfinger Investment Case: Turnaround case based on favorable business model
The Bilfinger Investment Case: Turnaround case based on favorable business model Structural demand for industrial Favorable business Financial soundness services characteristics • BB+ / stable outlook • >60% of output in recurring • 40% equity ratio • Increasing # of Industrial plants • Increasing t
Slide 29: Appendix
Appendix
Slide 30: Selected orders – MMO segment
Selected orders – MMO segment APPENDIX Customers rely on proven maintenance competence Statoil – expansion of our market position • Customer relationship spanning decades: Contracts extended once again, term until 2031 • Insulation, scaffolding, surface treatment and operational support services for
Slide 31: Selected orders – E&T segment
Selected orders – E&T segment APPENDIX Tailored engineering services for our customers Nord Stream 2 – Bilfinger is process technology specialist • Development, delivery and commissioning of the process and safety systems • Total volume: more than €15 million • Follow-up order for services Order fro
Slide 32: Nuclear Industry: Outstanding competences from Bilfinger
Nuclear Industry: Outstanding competences from Bilfinger APPENDIX Market potentials throughout the entire lifecycle of a plant Extensive experience in the design, construction, calculation, manufacturing, assembly and commissioning of various large-scale plants, components and treatment systems for
Slide 33: E&T: Output volume below prior-year as planned
E&T: Output volume below prior-year as planned APPENDIX EBITA adjusted improved Development of output volume and profitability -12%/-11% • Book-to-bill 1.0: 300 296 281 263 Orders received supported by 258 3.5% approved claims in ongoing projects -8.2% Low level of output volume, however, 0.9% conti
Slide 34: MMO: Significant increase in output volume and orders received
MMO: Significant increase in output volume and orders received APPENDIX Book-to-bill > 1 EBITA at prior-year level Development of output volume and profitability +7%/+9% • Orders received: 644 637 632 +19% (org. +20%) 589 570 Book-to-bill 1.1 due to catch-up 4.4% effects in framework contracts, 5.6%
Slide 35: OOP: Eight entities already sold since the beginning of the year
OOP: Eight entities already sold since the beginning of the year APPENDIX One further unit in advanced sales negotiations OOP output volume (€ million) Dilutive: Progress M&A track: 157 • 13 units as of December 31, 2016 • Eight have already been sold (closed: 6, signed: 2) 41 Q3: book-loss of €0m,
Slide 36: SG&A expenses significantly below prior-year
SG&A expenses significantly below prior-year APPENDIX due to sustainable savings and non-recurring effects Adjusted gross profit (€ million) Adjusted selling and administrative expenses (€ million) 115 (11.3%) 101 1 (10.1%) 7 7 10 0 -107 -106 -96 43 114 (-10.5%) (-10.7%) (-9.6%) (4.4%) 101 (11.2%) 1
Slide 37: Operating cash flow below comparably high prior-year, YTD above prior-year
Operating cash flow below comparably high prior-year, YTD above prior-year APPENDIX Net profit in prior-year characterized by sale of Apleona Adjusted net profit above prior-year Operating cash flow adjusted1 (€ million) Net profit (€ million) 71 -78.9% 457 Adjust- 32 ments Discontinued operations 5
Slide 38: Disclaimer
Disclaimer This presentation has been produced for support of oral information purposes only and contains forward- looking statements which involve risks and uncertainties. Forward-looking statements are statements that are not historical facts, including statements about our beliefs and expectation