Dometic Group Ab · OMXSTO:DOM
Dometic Group Ab — Q3 2021 Earnings Presentation
41 slides from Dometic Group Ab's earnings presentation, Oct 22, 2021
Slide 1: Interim Presentation Q3 2021
INTERIM PRESENTATION Q3 2021 October 22, 2021
Slide 2: Juan Vargues, President & CEO
JUAN VARGUES PRESIDENT & CEO
Slide 3: Q3 2021 Highlights
Q3 2021 HIGHLIGHTS Market development ▪ Continued strong demand ▪ Record high backlog for the period ▪ Retail inventory levels are low across all verticals ▪ Constraints in supply chain continue Performance ▪ Milestone passed - SEK 20 b. LTM ▪ 24% sales growth ▪ High M&A activity – eight acquisition
Slide 4: Q3 2021 Financial Summary
Q3 2021 FINANCIAL SUMMARY Net sales of SEK 5,545 m, +24% total growth ▪ +11% organic ▪ -2% FX SEKm SEKm ▪ +15% M&A 6,000 1800 5,500 Net sales +24% 5,000 1600 EBIT before i.a.c. of SEK 785 m, +14% 4,500 1400 ▪ EBIT margin of 14.2% (15.5%) 4,000 1200 3,500 EBITDA of SEK 987 m, +14% 3,000 1000 2,500 80
Slide 5: YTD September 2021 Financial Summary
YTD SEPTEMBER 2021 FINANCIAL SUMMARY Net sales of SEK 15,974 m, +33% total growth ▪ +30% organic ▪ -5% FX SEKm SEKm ▪ +8% M&A 16,500 15,000 Net sales 3750 +33% 13,500 EBIT before i.a.c. of SEK 2,471 m, +68% 3250 12,000 ▪ EBIT margin of 15.5% (12.3%) 2750 10,500 EBIT 9,000 2250 EBITDA SEK 3,004 m, +5
Slide 6: Sales Growth Q3 2021
SALES GROWTH Q3 2021 Total growth SEKm Q3 2021 80% 20,500 SEK 5,545 m, +11% organic growth 20,000 ▪ Americas +9% 60% 19,500 ▪ EMEA +10% 19,000 40% 18,500 ▪ APAC +54% 18,000 ▪ Global +6% 20% 17,500 17,000 20% growth compared to Q3 2019 0% 16,500 ▪ Organic +13% 16,000 ▪ FX -8% -20% 15,500 ▪ M&A +15% 1
Slide 7: Application Areas
APPLICATION AREAS FOOD & BEVERAGE CLIMATE Q3 SALES SPLIT, Q3 6,000 2,000 8,500 2,500 +17% APPLICATION AREA* +17% 2,026 1,428 1,500 8,000 2,000 5,500 7,500 1,500 5,000 1,000 7,000 1,000 4,500 500 6,500 500 4,000 0 6,000 0 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2019 2020 2021 2019 2020
Slide 8: Sales Channels
SALES CHANNELS SALES SPLIT, Q3 SERVICE AND AFTERMARKET SALES CHANNEL* +19% 7,500 3,000 7,000 2,500 2,119 6,500 2,000 6,000 1,500 5,500 1,000 5,000 4,500 500 4,000 0 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 OEM, 51% (52%) 2019 2020 2021 SAM, 37% (37%) Q3 OEM Q3 DISTRIBUTION DIST, 12% (11%) +50% +23% 11,000 2,748 3
Slide 9: Sales Channel Development
SALES CHANNEL DEVELOPMENT DISTRIBUTION + SERVICE AND AFTERMARKET FROM 39% TO 48% 2017 Q3 rolling 12 months 2021 Q3 rolling 12 months Total sales SEK 13.6 b Total sales SEK 20.2 b Distribution Distribution 12% 11% ▪ In line with strategy of having >50% of sales outside OEM ▪ Drives margin expansion S
Slide 10: EBIT and EBIT Margin Before I.A.C
EBIT AND EBIT MARGIN BEFORE I.A.C EBIT Run rate 14.5% (11.1%) SEKm EBIT-margin Q3 2021 1,200 15% EBIT margin 14.2% (15.5%) 1,050 + Sales growth 14% + Less negative impact from US trade tariffs 900 + Cost saving activities 750 13% ‒ Sales mix with stronger sales in RV OEM 600 ‒ Negative FX evolution
Slide 11: Market Price Development - Steel
1,300 1,100 1,500 300 500 700 900 January-19 February-19 March-19 April-19 Steel May-19 June-19 http://www.mbi-metalsource.com/ July-19 [EUR/to] August-19 September-19 Hot Rolled Coil October-19 November-19 December-19 January-20 February-20 March-20 [EUR/to] April-20 May-20 Thin sheet metal June-20
Slide 12: Freight Costs
FREIGHT COSTS GLOBAL CONTAINER FREIGHT RATE INDEX FROM JULY 2019 TO SEPTEMBER 2021 (IN U.S. DOLLARS) ▪ Acceleration during the third quarter 12,000 ▪ Average price +74% in three months 10,000 ▪ Shipment lead-times more than doubled 8,000 in one year 6,000 4,000 2,000 0 Source: Statista. Freightos: T
Slide 13: Americas Q3
AMERICAS Q3 Net sales of SEK 1,724 m, +9% organic NET SALES AND EBIT MARGIN BEFORE I.A.C. ▪ Growth driven by Power & Control and Other applications 9.0% ▪ Strong performance in OEM in all verticals 1,800 Climate, 43% ▪ Continued strong growth in Distribution and Service 1,600 & Aftermarket supported
Slide 14: EMEA Q3
EMEA Q3 Net sales of SEK 1,733 m, +10% organic NET SALES AND EBIT MARGIN BEFORE I.A.C. ▪ Growth driven by application areas Climate and Power & Control ▪ Strong performance in RV OEM 2,100 21.0% Climate, 49% ▪ CPV OEM impacted by customer production stops Food & Beverage, 33% 18.0% ▪ Acquisitions of
Slide 15: APAC Q3
APAC Q3 Net sales of SEK 516 m, +54% organic NET SALES AND EBIT MARGIN BEFORE I.A.C. ▪ Growth in all application areas compared to Q3 2020 largely impacted by lock-downs in Australia. ▪ All sales channels showing strong growth 550 33.0% Climate, 36% 500 ▪ All time high backlog 30.0% Food & Beverage,
Slide 16: Global Q3
GLOBAL Q3 Net sales of SEK 1,573 m, +6% organic NET SALES AND EBIT MARGIN BEFORE I.A.C. ▪ Growth driven by application areas Food & Beverage and Power & Control 2,000 26.0% ▪ Backlog all time high Climate, 16% ▪ Hospitality business picking up 24.0% Food & Beverage, 15% 1,600 ▪ Strong demand for the
Slide 17: 2021 Strategy Execution
2021 STRATEGY EXECUTION 1▪ Profitable expansion ▪ Strong growth in Distribution and Service and Aftermarket, LTM sales share 48% (39% in LTM Q3 2017) ▪ Eight acquisitions year to date ▪ B2C platform implementation ongoing in Europe after successful launches in US and Australia 2▪ Product leadership
Slide 18: Steady Increase in Social Media Followers
STEADY INCREASE IN SOCIAL MEDIA FOLLOWERS 740 Followers 720 700 533k (+2%) Thousand 680 161k (+46%) 660 640 36k (+58%) 620 Jul Aug Sep Q3 2021 Q3 2020 We have stopped to externally report number of visitors to Dometic.com as a consequence of the Graph includes Facebook, Instagram and LinkedIn implem
Slide 19: Growth in Outdoor Distribution Channels
GROWTH IN OUTDOOR DISTRIBUTION CHANNELS In >4,300 stores worldwide >50 pure e-tailer partners dometic.com e-commerce ▪ Growing presence +42% ▪ Presence +54% since end ▪ New platform launched in from end 2020 2020 the US and Australia ▪ Igloo acquisition will ▪ Drives sales growth and ▪ Q3 sales grow
Slide 20: Accelerated Acquisitive Journey
ACCELERATED ACQUISITIVE JOURNEY EIGHT ACQUISITIONS IN 2021 TARGETING THE OUTDOOR MARKET Residential Outdoor Vehicle based Outdoor Service and Aftermarket Outdoor Mobile Power activities expansion Solutions Announced in September
Slide 21: Cadac
CADAC COMPLEMENTS OUR OUTDOOR VEHICLE-BASED ACTIVITY OFFERING ▪ Provider of premium outdoor barbecues and accessories to the outdoor vehicle-based activity market ▪ Products are sold primarily across Europe ▪ Net sales in 2020 EUR 17 million with a good operating margin ▪ Closing is expected in Q4 2
Slide 22: Igloo
IGLOO A TRANSFORMATIVE ACQUISITION ▪ Iconic brand with a clear number one position on the cooling box market in the US ▪ A perfect complement to the Dometic premium range of active coolers ▪ Net sales of for the previous 12 months1) is USD 401 million (+24%), with an EBITDA margin of 10.1% ▪ Synergi
Slide 23: Outdoor – Vehicle-Based Activities
OUTDOOR – VEHICLE-BASED ACTIVITIES
Slide 24: Entering RV Heater Market in Europe
ENTERING RV HEATER MARKET IN EUROPE DOMETIC COMBO HEATER FOR AIR AND HOT WATER • First combo heater by Dometic • Unique engineering with separate burners for air and water heating for improved energy efficiency, performance and full flexibility • Full integration with the climate system with the new
Slide 25: Sanitation Solution for Marine
SANITATION SOLUTION FOR MARINE HANDWAVE TOILET CONTROL SWITCH • Contactless toilet flush switch with a capacitive touch control display • Let users flush and refill the toilet with a simple wave of the hand • Ideal for retrofit, easy to install
Slide 26: Energy Efficient AC for Marine
ENERGY EFFICIENT AC FOR MARINE DOMETIC VOYAGER SERIES TX VARIABLE CAPACITY AIR CONDITIONER • Yacht comfort now available for smaller boats • Less noise and quieter operation • Reduced energy costs and greater system durability for less maintenance • Utilizing Dometic’s innovative variable capacity t
Slide 27: Restructuring Program
RESTRUCTURING PROGRAM ▪ Locations ▪ No location affected in the quarter, 22 so far ▪ Employees ▪ No employees affected in the quarter, 804 so far ▪ Costs ▪ SEK 17 m in the quarter, SEK 283 m so far ▪ COVID-19 related travel restrictions combined with strong market demand are slowing down some projec
Slide 28: Sustainability
SUSTAINABILITY COMMITTED TO DRIVE SUSTAINABILITY IN OUR INDUSTRY ▪ LTIFR1 reduced by 40% KPI Focus area Actual Same period 2021 Target ▪ Implementation of Health & Safety guidelines prev. year continues LTIFR People 2.4 4.0 2.0 % female managers People 23% 23% 26% ▪ Share of female managers remain a
Slide 29: Stefan Fristedt, CFO
STEFAN FRISTEDT CFO
Slide 30: Net Sales and EBIT Bridge, SEK m
NET SALES AND EBIT BRIDGE, SEK M Q3 2020 TO Q3 2021. EBIT BEFORE I.A.C. ▪ Currency translation and transaction effects Volume, price, mix, cost, ▪ Acquisitions accretive to margins Q3 2020 Currency M&A other Q3 2021 ▪ Volume, price, mix, cost, other Net Sales 4,466 -103 686 496 5,545 + Sales growth
Slide 31: 2021 Acquisitions
2021 ACQUISITIONS Q3 2021 SEK m 2021 acquisitions Dometic total Sales 686 5,545 ▪ SEK 686 m in Q3 net sales, equals to 15% EBIT bef i.a.c. 113 785 growth from M&A 16.5% 14.2% Amortization of acquisition 24 94 related intangible assets ▪ EBITA margin 20.0%, which is above Dometic EBITA bef i.a.c. 137
Slide 32: Operating Cash Flow
OPERATING CASH FLOW SEKm 1,600 210% 157% 1,400 180% 1,200 118% 150% 1,000 373 120% 800 1,417 1,301 90% 600 34 1,043 917 875 60% 400 724 30% 200 311 346 181 0 84 -20 0% -200 -30% -400 -60% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2019 2019 2019 2019 2020 2020 2020 2020 2021 2021 2021 Operating cash flow Cash
Slide 33: Working Capital
WORKING CAPITAL DAYS, NORMAL CURRENCY DPO DSO 80 60 55 70 60 50 47 60 59 45 50 40 45 40 35 30 30 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2019 2019 2021 2019 2019 2021 DPO quarter DPO LTM DSO quarter DSO LTM SEKm DIO Days 8,000 120 140 130 6,000 100 87 120 4,000 106 80 2,000 100 60 0 80
Slide 34: Capex & Research & Development
CAPEX & RESEARCH & DEVELOPMENT (SEK m, % OF NET SALES) CAPEX 150 8 ▪ Q3 2021 CAPEX: 1.7% of net sales 1.7% 6% 100 1.5% (1.1% in Q3 2020) 1.1% 4% 114 50 95 71 68 72 77 77 2% 38 48 0 0% Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2019 2019 2020 2020 2020 2020 2021 2021 2021 R&D ▪ Q3 2021 R&D: 120 6 100 2.1% 1.9% 5 1.9
Slide 35: Cash Flow for the Period
CASH FLOW FOR THE PERIOD SEK m Q3 2021 Q3 2020 ▪ Operating cash flow SEK 346 m (1,045) EBIT 762 675 ▪ Impacted by supply lead-times and strong demand Adjustments for non-cash items 155 232 Changes in Working Capital -474 190 Investments in fixed assets -98 -53 ▪ Acquisitions SEK -549 m (-) Operating
Slide 36: Debt Maturity Profile and Leverage
DEBT MATURITY PROFILE AND LEVERAGE Debt maturity profile, SEK m USD loans EUR bonds EKN loan ▪ New 7-year bond, rate 2,00% 2.000 ▪ Undrawn revolving credit facility of EUR 200 m 3.059 2.938 3.059 3.059 1.847 2021 2022 2023 2024 2025 2026 2027 2028 Net debt leverage ▪ Q3 Net debt leverage 1.5x (2.8x)
Slide 37: Q3 Summary
Q3 SUMMARY Business highlights ▪ Strong performance despite supply chain constraints and increasing freight and raw material prices ▪ Passed SEK 20 b. in LTM sales ▪ Record high order backlog for the period ▪ Low inventory levels and continued strong market demand ▪ Supply constraints remain the mai
Slide 38: Dometic Capital Markets Update
DOMETIC CAPITAL MARKETS UPDATE NOVEMBER 30, 2021. 14:00 – 17:30 CET. MODERNA MUSEET STOCKHOLM Schedule 13:00 Registration and event opens. Products will be on display 14:00 Capital Markets Update presentations 17:30 Event ends More info and registration: https://www.dometicgroup.com/en/investors/cap
Slide 39: Dometic
“> DOMETIC
Slide 40: Disclaimer
DISCLAIMER SOME STATEMENTS HEREIN ARE FORWARD-LOOKING AND THE ACTUAL OUTCOME COULD BE MATERIALLY DIFFERENT. IN ADDITION TO THE FACTORS EXPLICITLY COMMENTED UPON, THE ACTUAL OUTCOME COULD BE MATERIALLY AFFECTED BY OTHER FACTORS, (A) CHANGES IN ECONOMIC, MARKET AND COMPETITIVE CONDITIONS, (B) SUCCESS
Slide 41: Slide 41