Tecan Group Ag · SIX:TECN
Tecan — FY2019 Earnings Presentation
29 slides from Tecan's earnings presentation, Mar 17, 2020
Slide 1: Full Year Results 2019
Zurich, March 17 2020 Full Year Results 2019 ANALYST & MEDIA CONFERENCE CALL
Slide 2: Speakers
Speakers Dr. Achim von Leoprechting, CEO Dr. Rudolf Eugster, CFO (until 28 February 2020)
Slide 3: Agenda
Agenda FINANCIAL AND OPERATING HIGHLIGHTS FINANCIAL RESULTS OUTLOOK QUESTIONS AND ANSWERS 3
Slide 4: Financial Highlights 2019
Financial Highlights 2019 • Another very successful business year 2019 • Tecan remains on growth track with +8.0% LC and +6.0% LC organic sales growth • Double-digit sales growth in the Life Sciences Business, with significant demand in instrument business • Strong performance in all key regions, es
Slide 5: Operating Highlights 2019
Operating Highlights 2019 • Launch of DreamPrep™ NGS, a fully automated sample preparation solution for next-generation sequencing (NGS) • New offers and continued focus on recurring sales generated from reagents and consumables in key applications • Launch of Spark® Cyto reader platform with imagin
Slide 6: Agenda
Agenda FINANCIAL AND OPERATING HIGHLIGHTS FINANCIAL RESULTS OUTLOOK QUESTIONS AND ANSWERS 6
Slide 7: 2019 Order Entry and Sales Performance
2019 Order Entry and Sales Performance ORDER ENTRY FY 2019 638.6 ORDER ENTRY 2019 VS. 2018 650 627.0 • +1.9% in CHF and +2.5% in LC 625 • 2018 benefited from large order in the Life Sciences Business CHF (mio) 600 575 for customized solutions (booked in H2 2018) 550 • Adjusted for this effect, solid
Slide 8: 2019 Segment Sales
2019 Segment Sales SALES 375 361.2 2018 LIFE SCIENCES BUSINESS: 2019 350 328.2 FY • Sales +10.0% in CHF and +11.2% in LC 325 • Organic sales growth of +9.1% in LC CHF (mio) 300 265.6 275.7 • Strong contribution from instrument business 275 250 • Underlying order entry grew with good MSD rate 225 200
Slide 9: FY 2019 Regional Sales Development
FY 2019 Regional Sales Development YoY % -36.3% in LC EUROPE -38.1% in CHF Others • Both business segments growing strongly 1.8% YoY % • Life Sciences Business at +7.5%, Partnering +9.2% in LC +14.6% in LC +11.9% in CHF NORTH AMERICA • Regional growth driven by Life Sciences Business Asia (+15.6%, o
Slide 10: FY 2019 Gross Profit
FY 2019 Gross Profit GROSS PROFIT (% = % OF SALES) GROSS PROFIT INCREASED TO CHF 297.3M 300 297.3 • CHF 18.9m or 6.8% above 2018 278.3 GROSS PROFIT MARGIN DOWN BY 20 BPS Main effects contributing: • (-) Impact from acquisitions CHF (mio) 260 • (-) Product and divisional mix • (+) Price 46.9% 46.7% 4
Slide 11: FY 2019 Cost Structure
FY 2019 Cost Structure OPERATING EXPENSES (% = % OF SALES) 209.4m OPERATING EXPENSES GREW MORE THAN 220 192.6m (32.9%) SALES, DUE TO ACQUISITION-RELATED COSTS 200 (32.4%) • Total operating expenses up by 50 bps, 180 driven by costs from acquired business 92.9 160 (14.6%) 89.1 • Sales & Marketing inc
Slide 12: FY 2019 Reported EBIT and EBITDA
FY 2019 Reported EBIT and EBITDA EBIT AND EBITDA 2018 EBITDA GREW TO CHF 122.8M 130 122.8 120 110.3 2019 • CHF 12.5m or 11.3% above 2018 CHF (mio) 110 • (-) Net impact from acquisition-related costs (≈CHF 10m) 100 88.6 88.7 90 • (+) Recurring contribution from new IFRS 16 accounting 80 standard (Lea
Slide 13: FY 2019 Segment Profitability
FY 2019 Segment Profitability EBIT (IN CHF MILLIONS) 56.7 2018 LIFE SCIENCES BUSINESS: 60 51.3 48.6 2019 50 46.2 • EBIT margin increased to 15.1% • Factors contributing include: CHF (mio) 40 30 • (-) Acquisition-related costs 20 • (+) Volume effect 10 0 • (+) strong margin in traditional core busine
Slide 14: FY 2019 Net Profit
FY 2019 Net Profit NET PROFIT NET PROFIT GREW MORE THAN EBIT 75 73.2 • CHF 2.5m or 3.5% above 2018 70.7 70 NET PROFIT MARGIN REACHED 11.5% 65.9 65 EBIT INCREASE OF CHF 0.15M CHF (mio) 60 57.1 BELOW EBIT LINE 54.5 55 • (+) Lower tax rate of 11.6% in connection with the tax reform in Switzerland (2018
Slide 15: FY 2019 Basic Earnings per Share
FY 2019 Basic Earnings per Share BASIC EARNINGS PER SHARE EARNINGS PER SHARE INCREASED TO CHF 6.18 7 AVERAGE NUMBER OF SHARES OUTSTANDING: 6.18 11.8M (2018: 11.7M) 6.02 6 5.67 INCREASE IN THE DIVIDEND FROM CHF 2.10 CHF / share TO CHF 2.20 PER SHARE TO BE PROPOSED 5.05 TO ANNUAL GENERAL MEETING 5 4.7
Slide 16: FY 2019 Cash Flow
FY 2019 Cash Flow 98.8 -99.1 296.8 -30.3 266.3 Cash at end of From Operations From Investments From Financing Cash at end of 2018 2019 CASH FLOW FROM OPERATIONS OF CHF 98.8M (2018: CHF 92.7M) • Cash conversion of 15.5 % of sales • Increase in net working capital by CHF 17.4m (very strong December sa
Slide 17: FY 2019 Key Figures
FY 2019 Key Figures 2018 2019 Δ IN % Order Entry (in CHF mio) 627.0 638.6 +1.9% Sales (in CHF mio) 593.8 636.8 +7.2% Sales in local currencies (in CHF mio) 589.5 636.8 +8.0% Gross Profit (in CHF mio) 278.3 297.3 +6.8% in % of sales 46.9% 46.7% R&D (in CHF mio) 51.1 59.9 +17.2% in % of sales 8.6% 9.4
Slide 18: Agenda
Agenda FINANCIAL AND OPERATING HIGHLIGHTS FINANCIAL RESULTS OUTLOOK QUESTIONS AND ANSWERS 18
Slide 19: Strategic Orientation and Priorities
Strategic Orientation and Priorities FOCUS ON CORE APPLICATIONS • Focus especially on genomics, protein analysis, cell & tissue analysis • Increasingly offering complete solutions with selected reagents and consumables FOCUS ON THE EMPLOYEES • Focus on internal talent and leadership development • At
Slide 20: Sample Library Preparation Key to Successful Sequencing
Sample Library Preparation Key to Successful Sequencing NGS LIBRARY PREPARATION IN STEPS EMPOWERING APPLICATIONS: FLUENT’S DNA 2019: DREAMPREP NGS 2020: DREAMPREP NAP 1 Sample collection 2 Sample identification & aliquoting 3 DNA or RNA extraction 4 Library preparation / Library quality control 5 Se
Slide 21: DreamPrep NAP Simplifying Nucleic Acid Extraction
DreamPrep™ NAP Simplifying Nucleic Acid Extraction COLLABORATION WITH ZYMO RESEARCH FOR MICROBIOME OR METAGENOME ANALYSIS Based on Fluent Automation Workstation 480 and FluentControl GX Assurance Software Integrated quantitation and normalization with Infinite 200 reader FLEXIBLE CONSISTENT CUSTOMIZ
Slide 22: Expanded Portfolio of Reagents and Consumables
Expanded Portfolio of Reagents and Consumables • Significant R&D investments in Genomics portfolio: RAPID EZ DNA-SEQ WORKFLOW reagents and dedicated workstations • Expanded reagent portfolio for NGS sample preparation Example: • Automation-friendly Rapid EZ1 to complete DNA-Seq portfolio • PCR-free
Slide 23: Partnering Business: Strong Development & Project Pipeline
Partnering Business: Strong Development & Project Pipeline • Various new instruments already being launched by the Example: launched in 2019 respective partners in 2019 • Still, more than five projects are in the development phase • Sales potential of individual projects ranges from single-digit to
Slide 24: New Coronavirus Sars-CoV-2 and COVID-19
New Coronavirus Sars-CoV-2 and COVID-19 SUPPORTING OUR PARTNERS IN FIGHTING THE OUTBREAK AND DISEASE RESEARCH CLINICAL TESTING 1 • Supporting customers with automation solutions and • Currently, supporting local IVD companies in China and reagents, mainly in research and drug discovery South Korea,
Slide 25: Financial Outlook for 2020
Financial Outlook for 2020 SALES DEVELOPMENT SALES OUTLOOK 700 Growth in MSD to • Forecast for growth in local currencies in the mid- to high 650 636.8 HSD range in LC1 single-digit percentage range, as in 2019 593.8 600 • Assuming an even higher share from organic growth CHF (mio) 548.6 550 500 506
Slide 26: Celebrating years of Tecan
UW) = P S 2 Se Celebrating 40 years of Tecan. os PITIEITPIPP PEPE PP PPP bdr eee ))|)| @TECAN.
Slide 27: Contact and Events
Contact and Events IR IPAD APP News, financial reports, presentations, videos and more NEXT EVENTS 2020 CONTACT Martin Braendle April 7: Annual Shareholder Meeting Vice President, Communications & IR Phone: +41 (0) 44 922 84 30 August 12: Half Year Results 2020 [email protected] www.tecan.com 27
Slide 28: Then and now: years of human discovery
Then and now: 40 years of human discovery.
Slide 29: Tecan – Who we are
Tecan – Who we are Tecan (www.tecan.com) is a leading global provider of laboratory instruments and solutions in biopharmaceuticals, forensics and clinical diagnostics. The company specializes in the development, production and distribution of automated workflow solutions for laboratories in the lif