Dometic Group Ab · OMXSTO:DOM

Dometic Group Ab — Q4 2016 Earnings Presentation

41 slides from Dometic Group Ab's earnings presentation, February 2017

  1. Slide 1: Interim Presentation Q4 2016

    INTERIM PRESENTATION Q4 2016

  2. Slide 2: Presenters

    PRESENTERS ROGER JOHANSSON PER-ARNE BLOMQUIST PRESIDENT & CEO CFO 2

  3. Slide 3: Roger Johansson, President & CEO

    ROGER JOHANSSON, PRESIDENT & CEO 3

  4. Slide 4: Q4 2016 Highlights

    Q4 2016 HIGHLIGHTS • Organic sales growth 5%. OEM, 66% • Gross margin improvement of 2.4 ppt. AM, 34% • EBIT margin improvement excl. rebranding/legal fees of SEKm 58 from 7.9% to 9.6%. • Robust performance in EMEA with RV and CPV double-digit growth. • Strong underlying margins but result impacted

  5. Slide 5: Q4 2016 Sales, EBIT and Operating Cash Flow

    Q4 2016 Sales (SEKm) EBIT bef. i.a.c (SEKm) Operating Cash Flow (SEKm) 10% (4% comparable currency) 5% (-7% comparable currency) Organic: 5% 2,786 210 200 2,523 623 352 Q4 2015 Q4 2016 Q4 2015 Q4 2016 Q4 2015 Q4 2016 1 Operating Cash Flow before items affecting comparability

  6. Slide 6: US RV Market – OEM Shipments

    US RV MARKET – OEM SHIPMENTS Rolling Twelve Months (000s units) 450 • Rolling three months 400 December: 350 106,400 units (89,200) +19% 300 • Full year 2016: 250 430,700 units (374,200) +15% 200 150 100 50 0 Jun Dec Jun Dec Jun Dec Jun Dec Jun Dec Jun Dec Jun Dec 10 10 11 11 12 12 13 13 14 14 15 15

  7. Slide 7: Europe RV Market Registrations

    EUROPE RV MARKET REGISTRATIONS Rolling Twelve Months (000s units) • Rolling three months 55 December: 50 12,500 units (12,300) +2%* 45 • Full year 2016: 40 103,600 units (91,400) +13%* 35 30 +16% 60 25 50 20 +8% 40 15 30 10 20 +22% +7% +5% 5 10 0 0 Jun Dec Jun Dec Jun Dec Jun Dec Jun Dec Jun Dec Jun

  8. Slide 8: Europe Trucks (Above 16 Tons) Registrations

    EUROPE TRUCKS (ABOVE 16 TONS) REGISTRATIONS Rolling Three Months (000s units) 70 65 • Rolling three months 60 December: 55 61,500 units (58,100) +6% 50 45 • Full year 2016: 40 237,900 units (215,100 35 units) +11% 30 25 20 15 10 5 0 Jun Dec Jun Dec Jun Dec Jun Dec Jun Dec Jun Dec Jun Dec 10 10 11 11

  9. Slide 9: US Power Boat Sales

    US POWER BOAT SALES Rolling Twelve Months (000s units) Power boat category (%) Full year 2016: 6.0% 15 15 8 5 10 2 -2 -4 5 -8 -7 -11 0 -5 -10 -41 -15 OB (11 - 40ft) IB (14-30 ft) IB (31-40 ft) IB (41-62 ft) IB (63-99 ft) Jun Dec Jun Dec Jun Dec Jun Dec Jun Dec Jun Dec Jun Dec 10 10 11 11 12 12 13 13

  10. Slide 10: Americas

    AMERICAS Q4 Highlights Breakdown of sales  RVOEM sales +7% and persistent strong RV market. By sales channel  Improved underlying margin from 8.3% to 11.5% (excl. cost for rebranding/legal fees)  Divested low margin Seating and chassis business in October.  RV sales affected by market mix, marke

  11. Slide 11: EMEA

    EMEA Q4 Highlights Breakdown of sales  Net sales increased by 12%, RVOEM +16%, outpacing the market. By sales channel  Aftermarket sales growth 14%.  Q4 includes rebranding cost of SEK 13 million.  AC service stations sales still strong.  Encouraging progress in the Marine business.  Acquired

  12. Slide 12: APAC

    APAC Q4 Highlights Breakdown of sales By sales channel  Net sales increase 7%.  Improved underlying margin from 24.7% to 25.2% excluding currencies and hedge.  Outpacing a soft RV market in Australia.  Retail growth 18%, mainly driven by the Australian market. AM, 54% OEM, 46% Net sales & ebit %

  13. Slide 13: Dometic Group Trends

    DOMETIC GROUP TRENDS Actual currency rolling 12 months Constant currency rolling 12 months Sales (SEKm) EBIT bef. i.a.c (SEKm) 13 000 1 800 12 000 1 600 11 000 1 400 10 000 1 200 0 0 Dec Mar Jun Sep Dec Mar Jun Sep Dec Dec Mar Jun Sep Dec Mar Jun Sep Dec 2014 2015 2016 2014 2015 2016 EBIT bef. i.a.c

  14. Slide 14: Business Area Development

    BUSINESS AREA DEVELOPMENT Rolling 12 Months, actual currency RV +9% CPV +10% (6% CC) (8% CC) 9 000 2 200 8 000 2 000 7 000 1 800 6 000 1 600 0 0 Dec Mar Jun Sep Dec Mar Jun Sep Dec Dec Mar Jun Sep Dec Mar Jun Sep Dec 2014 2015 2016 2014 2015 2016 Marine +6% Other +7% 1 200 (5% CC) 1 300 (6% CC) 1 25

  15. Slide 15: Per-Arne Blomquist, CFO

    PER-ARNE BLOMQUIST, CFO Mobile living made easy. “> DOMETIC

  16. Slide 16: Dometic Group Net Sales Bridge Q4

    DOMETIC GROUP NET SALES BRIDGE Q4 (SEKm) Translation FX details +10% Share of 2,786 Net Sales impact USD 84 54% -1% EUR 44 28% AUD 23 14% 5% HKD 3 2% 2,523 GBP -7 -4% 6% CNY 0 0% Other 10 6% Total 157 Q4 2015 Translation Organic Divestments Q4 2016 FX growth 16

  17. Slide 17: Full Year 2016

    FULL YEAR 2016 Sales (SEKm) EBIT bef. i.a.c (SEKm) Operating Cash Flow (SEKm) 8% (6% comparable currency) 15% (13% comparable currency) Organic: 7% 12,388 1,621 11,486 1 390 1,412 1 296 FY 2015 FY 2016 FY 2015 FY 2016 FY 2015 FY 2016 1 Operating Cash Flow before items affecting comparability

  18. Slide 18: Dometic Group Net Sales Bridge 2016

    DOMETIC GROUP NET SALES BRIDGE 2016 (SEKm) Translation FX details +8% 12,388 Share of Net Sales impact -1% USD 166 77% EUR 57 26% 11,486 AUD 14 7% 7% 2% HKD 4 2% GBP -24 -11% CNY -2 -1% Other 0 0% Total 216 1512 Translation Organic Divestments 1612 FX growth 18

  19. Slide 19: Key Ratios

    KEY RATIOS Q4 Q4 FY FY SEKm 2016 2015 2016 2015 Sales Net sales 2,786 2,523 12,388 11,486 Growth, % 10.4 14.3 7.9 30.4 Organic growth, % 5.3 8.6 6.9 7.7 Profitability EBIT before i.a.c. % 7.5 7.9 13.1 12.3 EBITDA before i.a.c. % 10.3 10.8 15.5 14.8 Capital efficiency Core working capital, to sales,

  20. Slide 20: Regional Results

    REGIONAL RESULTS Q4 Q4 Change (%) FY FY Change (%) SEK million 2016 2015 Rep. Adj.⁽¹⁾ 2016 2015 Rep. Adj.⁽¹⁾ Americas 1 256 1 204 4% -3% 5 749 5 538 4% 1% EMEA 1 082 927 17% 12% 5 093 4 479 14% 13% Asia Pacific 448 392 14% 7% 1 546 1 400 10% 9% Medical division⁽²⁾ - - - - - 69 - - Total net sales 2

  21. Slide 21: Margin Improvements in the Largest Regions

    MARGIN IMPROVEMENTS IN THE LARGEST REGIONS AMERICAS EMEA 10.4% 10.1% 2.8% 8.3% 8.1% 3.3% 1,527 1,526 0.6% 1,552 1,440 1,237 1,204 1,256 1,222 1,082 927 1.0% Q4 Q1 Q2 Q3 Q4 Q4 Q1 Q2 Q3 Q4 2015 2016 2016 2016 2016 2015 2016 2016 2016 2016 APAC 26.3% 23.7% EBIT% 21.8% 24.3% EBIT% w/o central cost 392 4

  22. Slide 22: Adjusted APAC

    ADJUSTED APAC 26.3% 23.7% 24.3% 21.8% 448 392 337 382 379 Q4 Q1 Q2 Q3 Q4 2015 2016 2016 2016 2016 EBIT margin (%) Q4 2016 Q4 2015 EBIT bef. i.a.c 21.8 24.3 EBIT w/o central cost 23.7 26.3 EBIT w/o central cost adj. for hedge impact 25.4 24.7 22

  23. Slide 23: Items Impacting Q4 2016

    ITEMS IMPACTING Q4 2016  Rebranding and class action legal cost of 58 MSEK (affects EBIT before i.a.c.)  Positive impact from recognition of interest expense carry forward of 175 MSEK (affects taxes)  Seating & chassis business divestment + 12.5 MUSD (affects cash flow) Items affecting comparabil

  24. Slide 24: Earnings Per Share – Q4 and FY 2016

    EARNINGS PER SHARE – Q4 AND FY 2016 Q4 2016 FY 2016 MSEK, SEK * Q4 2016 FY 2016 EPS EPS Net sales 2,786 12,388 Operating profit (before i.a.c) 210 1,621 0.71 5.48 Finance net -9 -118 -0.03 -0.40 Tax 138 -93 0.47 -0.31 Result for the period 302 1,362 1.02 4.60 No. of shares, million 295.8 295.8 Earni

  25. Slide 25: Capex & PMI

    CAPEX & PMI (SEKm, % OF NET SALES) CAPEX (SEKm, % of net sales) 3.5% • Full year 2016 capex: 80 3.0% 70 1.8% of net sales. 3.0% 60 2.3% 2.4% (2.1% in 2015) 1.9% 2.0% 2.5% 50 1.8% 1.9% 2.0% 40 2.1% 66 74 1.3% 68 1.5% 30 56 58 52 53 60 20 44 1.0% 10 0.5% 0 0.0% Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2014 2015 201

  26. Slide 26: Working Capital Development

    WORKING CAPITAL DEVELOPMENT 24.3% 24.6% 24.5% 24.5% 24.3% 24.3% 23.2% 22.3% 22.5% 22.0% 21.5% 21.8% 21.9% 21.3% 430 244 253 200 219 126 74 -24 -117 -183 -225 -299 -293 -524 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2013 2014 2015 2016 Average core WC / LTM sales Change in core WC 26

  27. Slide 27: Working Capital

    WORKING CAPITAL (SEKm) 2 655 SEKm 2 104 Delta inventory 439 of which FX 144 2 637 2 199 906 1 041 -1 000 -1 024 December December 2015 2016 Inventory Accounts Receivables Accounts Payables 27

  28. Slide 28: Cash Flow

    CASH FLOW (SEKm) % 700 229% 250 600 200 145% 147% 500 136% 150 123% 108% 107% 400 373 78% 100 73% 89% 300 623 50 61% 511 535 200 416 388 0 308 337 8% 342 352 258 -18% 287 -22% 100 -50 37 0 -100 -53 -102 -100 -150 -200 -200 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2013 2014 2015 2016 Cash conversion

  29. Slide 29: Net Debt Leverage and Net Debt Details

    NET DEBT LEVERAGE AND NET DEBT DETAILS 2.4 2.4 2.1 1.8 1.7 Q4 2015 Q1 2016 Q2 2016 Q3 2016 Q4 2016 SEKm Q4 2015 Q1 2016 Q2 2016 Q3 2016 Q4 2016 RCF 311 131 0 0 0 Capex 0 0 0 0 0 Senior term A 996 988 1,016 934 958 Senior term B 3,484 3,457 3,558 3,632 3,727 Local facilities 58 49 76 86 123 Total deb

  30. Slide 30: Items Impacting the First Quarter 2017

    ITEMS IMPACTING THE FIRST QUARTER 2017  Rebranding and legal fees of SEK 40 - 50 million (affects EBIT before i.a.c.)  Acquisitions (IPV and Oceanair) of SEK 186 million (affects cash flow).  IPV and Oceanair adding top line of approximately SEK 300 million for full year 2017.  Both acquisitions

  31. Slide 31: Financial Targets

    FINANCIAL TARGETS Mid/long term FY 2014 FY 2015 Q4 2016 FY 2016 Financial target Net Sales Growth1 5% 8% 5% 7% 5% EBIT Margin2 11.6 % 12.3 % 7.5 % 13.1 % 15 % Net Debt / EBITDA 7.5x 2.4x 1.7x 1.7x 2.0x Dividend Policy - No dividend - 40% 40 % 1Organic sales growth 2EBIT before I.A.C. 31

  32. Slide 32: Proposed Dividend

    PROPOSED DIVIDEND  Dometic Board of Directors will propose to the Annual Shareholders Meeting to give a cash dividend of SEK 547 million, corresponding to SEK 1.85 per share.  The proposed dividend equals 40% of the profit for the period. 32

  33. Slide 33: US Class Action Complaint

    US CLASS ACTION COMPLAINT  On April 21, 2016 a class action complaint was filed in California and an amended complaint was subsequently filed on July 8, 2016. The California action consists of 7 named plaintiffs. Dometic filed a motion to dismiss the action, which is now fully briefed and the Court

  34. Slide 34: Summary 2016 Outlook 2017

    SUMMARY 2016  Strong organic growth driven by overall favorable markets and sales initiatives.  Majority of businesses improved in growth and profitability.  Extra cost for rebranding, class action legal activities and logistics in EMEA and Americas.  Strengthened management team in place.  Act

  35. Slide 35: Mobile living made easy. Dometic

    35 Mobile living made easy. “> DOMETIC

  36. Slide 36: Appendix

    APPENDIX 36 Mobile living made easy. “> DOMETIC

  37. Slide 37: Appendix A: Quarterly Summary Key Financials

    APPENDIX A Quarterly Summary Key Financials Q4 Q4 FY FY SEK million 2016 2015 2016 2015 Net sales 2,786 2,523 12,388 11,486 EBITDA 250 255 1,871 1,727 % of net sales 9.0% 10.1% 15.1% 15.0% Operating profit (EBIT) 173 183 1,573 1,436 % of net sales 6.2% 7.3% 12.7% 12.5% Operating profit (EBIT) before

  38. Slide 38: Appendix B: Group P&L

    APPENDIX B Group P&L Q4 Q4 FY FY SEK million 2016 2015 2016 2015 Net sales 2,786 2,523 12,388 11,486 Cost of goods sold -1,967 -1,842 -8,463 -8,127 Gross Profit 819 681 3,925 3,359 Sales expenses -421 -356 -1,651 -1,433 Administrative expenses -183 -134 -604 -510 Other operating income and expenses

  39. Slide 39: Appendix C: Proforma 2016

    APPENDIX C Proforma 2016 – Group and Americas excluding seating and chassis, architectural products Total Group, SEKm Q1 2016 Q2 2016 Q3 2016 Q4 2016 FY 2016 Net sales 2,911 3,394 3,079 2,757 12,142 EBIT bef. i.a.c 400 579 425 208 1,613 EBIT bef. i.a.c, % 13.7% 17.1% 13.8% 7.6% 13.3% Americas, SEKm

  40. Slide 40: Disclaimer

    DISCLAIMER This document contains statements that constitute forward looking statements. These statements appear in a number of places in this document and include statements regarding the intent, belief or current expectations of the customer base, estimates regarding future growth in the different

  41. Slide 41: Mobile living made easy. Dometic

    Mobile living made easy. “@> DOMETIC

Dometic Group — Q4 2016 Earnings Presentation on 6ix