Sonova Holding Ag · SIX:SOON
Sonova — H1 2021/22 Earnings Presentation
38 slides from Sonova's earnings presentation, Nov 15, 2021
Slide 1: Half-Year Results 2021/22
Half-Year Results 2021/22 Arnd Kaldowski, CEO Birgit Conix, CFO Thomas Bernhardsgrütter, IR Stäfa, November 15, 2021
Slide 2: Disclaimer
Disclaimer This presentation contains forward-looking statements, which offer no guarantee with regard to future performance. These statements are made on the basis of management’s views and assumptions regarding future events and business performance at the time the statements are made. They are su
Slide 3: Sustained positive momentum supported by market recovery
Sustained positive momentum supported by market recovery − Market recovery continued in 1H, with some residual COVID-19 challenges remaining − Good sales momentum driven by our latest product innovations and strong commercial execution − Positive sales momentum in HI, supported by the continued succ
Slide 4: Sonova Group
sonova Sonova Group poh
Slide 5: Sonova Group results: Key highlights 1H 2021/22
Sonova Group results Key highlights – 1H 2021/22 Sales EPS (adj.) Sales outlook CHF 1,604m CHF 4.86 per share +24-28% +48.5% in LC +146.5% in CHF growth in LC (2y CAGR: : +8.5% in LC) (2y CAGR: +28.5% in LC) in FY 2021/22 EBITA (adj.) Innovation EBITA outlook CHF 406.4m Phonak Paradise +34-42%* +129
Slide 6: Sonova's strategy
Sonova’s strategy Strategic pillars Lead innovation in audiological performance & consumer experience Leverage M&A Expand and optimize to accelerate growth omni-channel audiological care strategically network Continuous process Extend reach through multi-channel, improvement & structural value-addin
Slide 7: Sonova's strategy: Lead innovation
Sonova’s strategy Lead innovation – Advancing innovation in HI and CI Phonak Paradise 2.0 Naída CI processor PRISM chip and new speech processing algorithms, ActiveVent™ Combines established Phonak Marvel platform and Tap Control, proven AB sound processing multiple Bluetooth® connections, Features
Slide 8: Sonova's strategy: AC network expansion
Sonova’s strategy AC network expansion – The combination of bolt-on M&A greenfield expansion Systematic approach to: Increase store density Optimize the store footprint Enter new growth markets Balance sheet investments: M&A Greenfield P&L investments: Higher spending for bolt-ons: Expansion o
Slide 9: Sonova Group results: Summary 1H 2021/22
Sonova Group results Summary 1H 2021/22 − Sales of CHF 1,603.8 million up +48.5% in LC (organic: +46.6%, 2y CAGR: +8.5%), +49.9% in CHF Group − EBITA (adj.) of CHF 406.4 million, up +129.3% in LC – benefiting from higher sales and structural optimization − EBITA margin (adj.) of 25.3%, up +890bps in
Slide 10: Sonova Group results: Key financials
Sonova Group results Key financials 1H2021/22 Δ % in LC Δ % in LC 2y CAGR CHF m vs. 1H 2020/21 vs. 1H 2019/20 in LC Sales HI segment 1,465.6 +46.9% +18.4% +8.8% Sales HI business 890.2 +46.2% +22.1% +10.5% Sales AC business 575.4 +48.0% +12.9% +6.3% Sales CI segment 138.3 +67.3% +10.9% +5.3% Total s
Slide 11: Sonova Group results: Sales components
Sonova Group results Sales components in CHF million OPERATIONAL FX +48.5% 1,588.1 1,603.8 19.6 15.7 498.9 1,069.6 1H 20/21 Organic M&A 1H 21/22 FX 1H 21/22 Reported net of divestments LC impact Reported YoY growth components +46.6% +1.8% +48.5% +1.5% +49.9% 2-year CAGR +7.6% +0.9% +8.5% -2.5% +6.0%
Slide 12: Sales by regions and key markets
Sonova Group results Sales by regions and key markets 1H 2021/22 1H 2020/21 CHF m Δ % in LC 2y CAGR in LC % Group sales CHF m % Group sales EMEA 830.6 +41.3% +7.0% 52% 572.8 54% USA 499.8 +70.3% +12.2% 31% 302.3 28% Americas (excl. USA) 116.9 +56.9% +7.7% 7% 71.7 7% Asia / Pacific 156.6 +23.2% +5.1%
Slide 13: Hearing Instruments Segment
Hearing Instruments Segment 13
Slide 14: Hearing Instruments segment: Key financials
Hearing Instruments segment Key financials Sales EBITA (adj.) Segment sales − Strong organic growth further supported by M&A CHF 1,466m CHF 388m − YOY performance driven by ongoing market +46.9% vs. PY in LC +107.9% vs. PY in LC recovery and easy comparison base +8.8% 2y CAGR in LC +25.6% 2y CAGR in
Slide 15: Sales dynamics – HI business
Hearing Instruments segment Sales dynamics – HI business HI business sales: CHF 890m +46.2% vs. PY in LC +10.5% 2y CAGR in LC +46.2% organic growth − Sustained momentum of Phonak Paradise –offering expanded with ActiveVent™ and Audéo Life − Successful launch of Unitron BLU − Renewal of private label
Slide 16: Sales dynamics – AC business
Hearing Instruments segment Sales dynamics – AC business AC business sales: CHF 575m +48.0% vs. PY in LC +6.3% 2y CAGR in LC + 42.7% organic growth − Pick-up of M&A activity elevating growth − Further progress on omni-channel strategy − Increased demand from digital lead generation − World of Hearin
Slide 17: Cochlear Implants segment
Cochlear Implants segment 17
Slide 18: Cochlear Implants segment: Key financials
Cochlear Implants segment Key financials Sales EBITA (adj.) Cochlear implant systems − Further recovery of surgery volumes in North CHF 138.3m CHF 18.0m America, CN and most Western European countries +67.3% vs. PY in LC Margin 13.0% − Recapturing market share after the voluntary field Up from negat
Slide 19: Financial Information
Financial Information 19
Slide 20: Sonova Group – Financial highlights
Financial information Sonova Group – Financial highlights − Sales of CHF 1,603.8 million Sales − Growth of +48.5% in LC (organic +46.6%), +49.9% in CHF (favorable FX impact: CHF +15.7 million) − Supported by low comparison figures and ongoing recovery, despite residual challenges from the pandemic −
Slide 21: Sonova Group – EBITA Components
Financial information Sonova Group – EBITA Components in CHF million OPERATIONAL ADJUSTMENTS FX +129.3% 399.7 393.9 0.1 -12.5 387.3 6.6 225.3 174.3 1H 20/21 Organic M&A 1H 21/22 Adjustments 1H 21/22 FX 1H 21/22 adjusted net of divestments adj. in LC in LC reported in LC reported Margin 16.3% +9.2% -
Slide 22: Key financials – As reported and adjusted
Financial information Sonova Group – Key financials – As reported and adjusted 1H 2021/22 ∆ margin 2y CAGR CHF m Margin ∆ % in LC in LC in LC Comments Sales (reported) 1,603.8 +48.5% +8.5% Gross profit (adj.) 1,183.1 73.8% +57.6% +430bps +11.0% ‒ Driven by ongoing cost optimization and higher volume
Slide 23: Operating expenses excluding acquisition-related amortization
Financial information Sonova Group – Operating expenses excluding acquisition-related amortization 1H 2021/22 1H 2020/21 2y CAGR CHF m Δ % in LC in LC CHF m Comments Research & Development (adj.) -114.8 +47.0% +20.4% -78.1 ‒ Continued step up in new technology investments in % of sales 7.2% 7.3% ‒ S
Slide 24: Operating Free Cash Flow
Financial information Sonova Group – Operating Free Cash Flow in CHF million +37.2% 7.1 -28.0 -23.8 337.3 2.9 133.2 245.8 1H 20/21 Profit before tax Depreciation & Amortization Income ∆ NWC & CAPEX 1H 21/22 OpFCF taxes paid Other items OpFCF Growth components +54.2% +2.9% -11.4% -9.7% +1.2% +37.2% ►
Slide 25: Sonova Group – Balance sheet
Financial information Sonova Group – Balance sheet CHF m 30 Sep 2021 30 Sep 2020 Comments Days sales outstanding (DSO) 54 58 ‒ Continued strong collection management Days inventory outstanding (DIO) 149 137 ‒ Targeted stock increases to counter supply chain risks Capital employed 2,917.2 2,673.9 ‒ R
Slide 26: Outlook
Outlook 26
Slide 27: Factors impacting 1H performance and outlook into 2H
Outlook Factors impacting 1H performance and considerations for outlook into 2H 1H 2021/22 2H 2021/22 − Ongoing market recovery and easy comparison base − Further market recovery but more challenging comparison base − Strong competitive position of Phonak Paradise − Ongoing risk of regional restrict
Slide 28: Re-iterating guidance and mid-term target
Outlook Re-iterating guidance and mid-term target Guidance Mid-term In LC FY 2021/22 Target Sales growth +24% to +28% +6% to +9% p.a. adj. EBITA growth +34% to +42% +7% to +11% p.a. Assumptions for 2H 2021/22 − Guidance includes further market normalization absent any additional headwinds from suppl
Slide 29: sonova
sonova
Slide 30: Thank you!
sonova Thank you!
Slide 31: Appendix
sonova Appendix
Slide 32: Sales by segment and sales components
Appendix Sales by segment and sales components 1H 2021/22 1H 2020/21 CHF m Δ % in CHF Δ % in LC CHF m Δ % in CHF Δ % in LC HI business 890.2 +46.5% +46.2% 607.8 -21.1% -16.7% AC business 575.4 +51.9% +48.0% 378.7 -27.7% -23.8% HI segment 1,465.6 +48.6% +46.9% 986.5 -23.8% -19.6% CI segment 138.3 +66
Slide 33: Business performance – Hearing Instruments segment
Appendix Business performance – Hearing Instruments segment Hearing Instruments business 1H 2021/22 1H 2020/21 CHF m Δ % in CHF Δ % in LC CHF m Δ % in CHF Δ % in LC Sales 890.2 +46.5% +46.2% 607.8 -21.1% -16.7% ∆ organic +281.1 +46.2% -129.6 -16.8% ∆ acquisitions - - 0.9 +0.1% ∆ disposals -0.2 -0.0%
Slide 34: Non-GAAP adjustments
Appendix Non-GAAP adjustments Adjustments for (in CHF m): 1H 2021/22 1H 2020/21 Restructuring +7.4 +21.9 thereof HI segment +6.5 +20.8 thereof CI segment +0.9 +1.1 Patent infringement lawsuit -99.0 Transaction costs related to the acquisition f the Sennheiser Consumer Division +5.0 - Total adjustmen
Slide 35: Key financials – As reported and adjusted
Appendix Key financials – As reported and adjusted 1H 2021/22 Adjustments 1H 2021/22 in CHF million Reported 1 Restructuring 2 Transaction costs Total Adjusted Sales 1,603.8 - - - 1,603.8 Cost of sales -422.1 +1.4 - +1.4 -420.7 Gross profit 1,181.7 +1.4 - +1.4 1,183.1 Research & Development -114.8 -
Slide 36: Cash flow statement
Appendix Cash flow statement 1H 2021/22 1H 2020/21 CHF m ∆ % in CHF CHF m Income before taxes 353.0 +60.6% 219.8 Depreciation & amortization 104.8 +7.3% 97.7 Working Capital -48.1 +144.6% -19.7 Other cash effects 10.6 -22.0% 13.6 Tax paid -31.3 +840.9% -3.3 Financial result 20.7 +93.2% 10.7 Operatin
Slide 37: FX impact on sales and margins
Appendix Sonova Group – FX impact on sales and margins USD/CHF EUR/CHF Rate Sales EBITA USD/CHF +/- 5% +/- CHF 51 million +/- CHF 19 million EUR/CHF +/- 5% +/- CHF 60 million +/- CHF 27 million 37
Slide 38: Sales by currency and FX rates
Appendix Sonova Group – Sales by currency and FX rates Effect Spot Other 1H-20/21 1H-21/22 1H-21/22 2H-20/21 FY-20/21 Nov-2021 USD USD 0.94 0.91 - 0.90 0.92 0.92 GBP, CAD, BRL, AUD EUR 1.07 1.09 + 1.08 1.08 1.05 and JPY GBP 1.19 1.27 + 1.22 1.21 1.23 CAD 0.69 0.74 + 0.70 0.70 0.73 EUR AUD 0.65 0.69