Consti Oyj · OMXHEX:CONSTI
Consti Oyj — H1 2017 Earnings Presentation
26 slides from Consti Oyj's earnings presentation, Aug 9, 2017
Slide 1: Consti Group Plc Half-Year Financial Report 1 January – 30 June 2017
CONSTI GROUP PLC HALF-YEAR FINANCIAL REPORT 1 JANUARY – 30 JUNE 2017 CEO Marko Holopainen CFO Esa Korkeela Building renovation specialist | www.consti.fi
Slide 2: Contents
Contents Highlights and Group performance Result, cash flow and financial position Market outlook and guidance Building renovation specialist | www.consti.fi
Slide 3: Net sales and order backlog improved
Highlights of the second quarter of 2017: Net sales and order backlog improved Highlights of 4-6/2017 (y-o-y comparison in brackets) Net sales EUR 78.8 (64.8) million, growth 21.6% EBIT EUR 2.7 (2.6) million, EBIT margin 3.4 (4.0)% Number of Adjusted EBIT EUR 2.7 (2.6) million, adjusted EBIT m
Slide 4: Net sales, order intake and order backlog improved
Q2/15 3 63,4 Q3/15 70,4 Q4/15 74,9 Q1/16 51,4 Q2/16 64,8 09/08/2017 Q3/16 70,6 Q4/16 74,8 Q1/17 57,3 Quarterly net sales (EUR m) Q2/17 78,8 Quarterly performance: Q2/15 74,5 Q3/15 28,5 Building renovation specialist Q4/15 63,6 | Q1/16 51,2 Q2/16 75,6 Q3/16 30,3 www.consti.fi Q4/16 66,1 Q1/17 59,5 Q2
Slide 5: Quarterly net sales development
Quarterly net sales development: Second quarter net sales up by 21.6% Quarterly net sales development Q2/2015 – Q2/2017 (EUR m) Comments ■ Q2/2017 net sales EUR 78.8 (64.8) million 85 78,8 74,9 • y-o-y sales growth 21.6% 74,8 75 70,4 70,6 • organic growth 17.6% Quarterly Net sales (EUR million) 63,4
Slide 6: Quarterly order intake development
Quarterly order intake development: Order intake up by 10% Quarterly order intake development Q2/2015 – Q2/2017 (EUR m) Comments 83,0 ■ Q2/2017 order intake EUR 83.0 (75.6) 85 million, up by 9.8% y-o-y 74,5 75,6 75 – Order intake growth was strongest in 66,1 Renovation Contracting (44.8%), Quarterly
Slide 7: Quarterly order backlog development
Quarterly order backlog development: Backlog up by 7% Quarterly order backlog development Q2/2015 – Q2/2017 (EUR m) Comments 250 ■ Q2/2017 order backlog on a record-high 227,9 level at EUR 227.9 (212.6) million 212,6 212,9 199,8 Year-on-year growth 7.2% 191,7 200 185,6 190,8 Quarterly Order backlo
Slide 8: Realisation of Consti's long-term financial targets Q2/2017
Realisation of Consti’s long-term financial targets Q2/2017 (rolling 12 months) Growth Profitability Cash flow Capital structure Dividends Net debt to The Company’s adjusted EBITDA aim is to distribute Average annual Adjusted Cash conversion ratio of less than as dividends at growth in net sales EBI
Slide 9: Result, Cash Flow and Financial Position
Result, Cash Flow and Financial Position 8 09/08/2017 Building renovation specialist | www.consti.fi
Slide 10: Quarterly adjusted EBIT development
Quarterly adjusted EBIT1 development: Absolute profitability improved in Q2/2017 Quarterly EBIT development Q2/2015 – Q2/2017 (EUR m) Comments 10 8% ■ Q2/17 EBIT 2.7 (2.6) million, or 3.4% (4.0%) of net sales 9 7% 6,2 % ■ Highest reported quarterly EBIT in history Quarterly adjusted EBIT margin (lin
Slide 11: Quarterly cash conversion development
Quarterly cash conversion development: Good free cash flow achieved in Q2/2017 Quarterly free cash flow and EBITDA Q2/2015 – Q2/2017 (EUR m) Comments ■ Q2/2017 free cash flow EUR 4.0 (0.4) 10 million 88% – Cash conversion ratio of 124.1% Free cash flow and EBITDA (EUR million) 8 Average cash (11.5%)
Slide 12: Quarterly net working capital development
Quarterly net working capital development: NWC released during Q2/2017 Quarterly net working capital1) Q2/2015 – Q2/2017 (EUR m) Comments Q2/15 Q3/15 Q4/15 Q1/16 Q2/16 Q3/16 Q4/16 Q1/17 Q2/17 ■ Net working capital EUR -7.9m 0 (-8.4m) at the end of Q2/2017 Net working capital at period-end (EUR milli
Slide 13: Balance sheet remained strong in the second quarter
Quarterly balance sheet structure: Balance sheet remained strong in the second quarter Quarterly net debt, equity ratio and gearing Q2/2015 – Q2/2017 Comments 45 100% ■ Net debt at EUR 15.5m (17.8m) 88,6 % 40 90% + Strong cash flow in Q2 76,1 % 80% 35 70,9 % – Dividends paid 70% 30 61,4 % ■ Equity r
Slide 14: Market Outlook and Guidance
Market Outlook and Guidance 13 09/08/2017 Building renovation specialist | www.consti.fi
Slide 15: Lead indicators for Finnish construction suggest a favourable market environment
Lead indicators for Finnish construction suggest a favourable market environment going forward Economic Sentiment and Construction Confidence / Finland (2007 – 7/2017) Comments ■ Economic sentiment in Finland rose above the long-term average in August 2016 ■ Construction confidence surpassed the lon
Slide 16: Stable growth in renovation to continue
Stable growth in renovation to continue Finnish new building and renovation market development ■ The peak of the economic cycle in EURmrd Renovation volume (real) New building volume (real) construction sector in progress. 30 – Challenges in availability of 25,6 26,1 26,0 26,2 building technology an
Slide 17: Renovation market growth supported by key structural growth drivers
Renovation market growth supported by a number of key structural growth drivers Ageing building stock Energy efficiency Million Finnish building stock by construction year m2 100 Buildings age of 50 years (approx): ~2025-2035 ~2040 Urbanisation ~2017 Residential 80 Non-residential 29,4 34,3 60 Modif
Slide 18: Examples of new orders
Examples of new orders TECHNICAL BUILDING RENOVATION BUILDING SERVICES CONTRACTING FACADES Q2/17 order intake: Q2/17 order intake: Q2/17 order intake: EUR 32.3m (-5%) EUR 21.0m (+45%) EUR 31.5m (+14%) ■ As Oy Merisoukka ■ Heinola city hospital ■ Koy Helsingin pipeline renovation, renovation, Heinola
Slide 19: Strengthening order backlog to support growth going forward
Strengthening order backlog to support growth going forward Quarterly order backlog and R12m net sales Q2/2015 – Q2/2017 (EUR m) Comments 300 ■ Rolling 12-month net sales on a 281 growth path R12m Net sales and order backlog (EUR million) 261 262 262 267 256 260 250 245 251 ■ Strengthening of order
Slide 20: Consti vision 2021 is goal-oriented
Consti vision 2021 is goal-oriented Consti professionals are passionate about renovating and developing the built environment in a sustainable and sensible manner. This is why we are number one in renovation construction. WHEN WE HAVE ACCOMPLISHED OUR VISION: Consti is Finland’s number one in reno
Slide 21: Consti Group's new strategic themes
Consti Group’s new strategic themes 1 Best profitability with the most efficient operations ─ The best lead time and productivity in renovation construction industry ─ Continuous relative decreasing of fixed and procurement costs ─ Systematic development of the business portfolio 2 Professional empl
Slide 22: New strategic themes aim for growth and EBIT margin improvement
New strategic themes aim for growth and EBIT margin improvement EFFICIENT OPERATIONS OPTIMISED AND COST MGMT SALES MIX OP. LEVERAGE THROUGH GROWTH EBIT margin ■ Efficient operations through implementing Lean ■ Relative increase methods in desired ■ Growth through renovation ■ Enhanced Ebit both orga
Slide 23: Acquisitions in 2017
Acquisitions in 2017: Two acquisitions during the half year reporting period and one acquisition in July 2017 Oulun talosaneeraus Oy (acquired in January), net sales in 2016 approximately EUR 8 million Pisara-Steel Oy (acquired in March), Oulu net sales in 2016 approximately EUR 2.4 million KP Kuopp
Slide 24: Active screening of M&A candidates to support strategy implementation
Active screening of M&A candidates to support strategy implementation Demonstrated Consti Group’s financial track Good organisational Relevant M&A strategy record fit targets N=X ■ Minimised overlap with ■ For instance: ■ Expansion in ■ Established strong local Consti’s current – Roof renovation and
Slide 25: Guidance for 2017
Guidance for 2017 “The Company estimates that its total annual sales for 2017 will grow compared to 2016.” 24 09/08/2017 Building renovation specialist | www.consti.fi
Slide 26: Summary
Summary 1. Quarterly net sales up by 21.6% year-on-year 2. Order intake and order backlog continued to increase year-on-year 3. Absolute profitability improved, balance sheet remained strong 4. Quarterly cash flow positively impacted by NWC released during Q2/2017 5. Steady market growth 6. Consti’s