Ascom Holding Ag · SIX:ASCN
Ascom — FY2015 Earnings Presentation
48 slides from Ascom's earnings presentation, Mar 9, 2016
Slide 1: Welcome to Ascom's 2015 Full-Year Results Conference
WELCOME TO ASCOM’S 2015 FULL-YEAR RESULTS CONFERENCE ANNUAL MEDIA CONFERENCE | 9 MARCH | ©2016 ASCOM 1
Slide 2: Agenda 9 March 2016
AGENDA 9 MARCH 2016 • Ascom‘s 2015 Performance Fritz Mumenthaler, CEO • 2015 Financial Results Bianka Wilson, CFO • Outlook Fritz Mumenthaler, CEO ANNUAL MEDIA CONFERENCE | 9 MARCH | ©2016 ASCOM 2
Slide 3: Highlights 2015 – Progress towards ASCOM 2020 (I)
HIGHLIGHTS 2015 – Progress towards ASCOM 2020 (I) • Solid development in Healthcare • Growth in acute care facilities 8% (at constant currencies) • Bolt-on acquisition of software company UMS in Italy • Myco launched according to schedule • Well received by customers • Eco-system of applications is
Slide 4: Highlights 2015 – Progress towards ASCOM 2020 (II)
HIGHLIGHTS 2015 – Progress towards ASCOM 2020 (II) • Wireless Solutions Net Revenue Group (Divisions) • Strong market development in North America and Wireless Network DACH Region Solutions Testing • UMS is an excellent strategic fit and accelerates 74% 26% Ascom roadmap for medical device integrati
Slide 5: Wireless Solutions
Wireless Solutions WIRELESS SOLUTIONS ANNUAL MEDIA CONFERENCE | 9 MARCH | ©2016 ASCOM 5
Slide 6: Global Healthcare Market – Promising Growth
Global Healthcare Market – Promising Growth Global Healthcare Healthcare drives wireless integration solutions market market Ascom 10% CAGR opportunity addressable market to USD 3 bn for Workflow Solutions and Global Healthcare ICT Healthcare Healthcare ~USD 7 bn Industry in EU software spend repres
Slide 7: Healthcare – growing in importance
Healthcare – growing in importance Net Revenue Wireless Solutions Net Revenue Wireless Solutions (Excl. OEM) Healthcare 67% Healthcare 60% Non Non Healthcare Healthcare 40% 33% ANNUAL MEDIA CONFERENCE | 9 MARCH | ©2016 ASCOM 7
Slide 8: By managing Mission Critical Communication in HC…
By managing Mission Critical Communication in HC… Services only Third Party Products only ANNUAL MEDIA CONFERENCE | 9 MARCH | ©2016 ASCOM 8
Slide 9: …we address hospital KPI's…
…we address hospital KPI’s… • Hospital main concern areas Hospitals KPI’s • Hospital efficiency • Patient safety index & financial performance • Harm events/patient day • Patient satisfaction index • Patient safety and patient • Patient waiting times satisfaction • Patient length of stay • Caregiver
Slide 10: … and interact with all hospital stakeholders
… and interact with all hospital stakeholders C-suite Operational IT Frontline executives Patients management Operations staff Achieve Feel well and Efficient Security and Solve daily safe financial operations cost problems targets ANNUAL MEDIA CONFERENCE | 9 MARCH | ©2016 ASCOM 10
Slide 11: Wireless Solutions established new solutions unit
Wireless Solutions established new solutions unit • Developing partners who are relevant to solution selling (Myco ecosystem) • Leveraging existing solutions in the regions and developing new solutions (so called Global Repeatable Solutions) • Support regions to develop new solution opportunities an
Slide 12: The Ascom solution – Neonatal intensive care Kuopio University Hospital
The Ascom solution – Myco at Neonatal intensive care work since Kuopio University Hospital May 2015 Finland 2,500 births • Ascom Myco per year • Unite Messaging Suite • Ascom Cardiomax 18 family • Unite Assign New rooms in • Ascom Innova neonatal Nursecall state-of-the-art neonatal intensive-care in
Slide 13: Myco's World of Healthcare Applications
Myco’s World of Healthcare Applications ANNUAL MEDIA CONFERENCE | 9 MARCH | ©2016 ASCOM 13
Slide 14: Ascom Technology Partner Program - Overview
Ascom Technology Partner Program - Overview Signed Partners: ACLS Solutions Partners in the onboarding stage: Applications include: Dictation/Transcript, Workflow Optimization, Decision Support, Medication Administration, EHR, Automated Vital signs/Patient Monitoring, Care Registration, Clinical Vid
Slide 15: Medanets mobile point-of-care app for caregivers
Medanets mobile point-of-care app for caregivers Medanets for caregivers • Reducing errors radically, in average 75% • Significant cost savings, up to 150 hours per month per ward • Better job satisfaction Direct access to patients’ Electronic Health Records • Patient measurements • Medication • Pai
Slide 16: Screen shots application workflow
Screen shots application workflow Menu drawer Select patient Scanning patient ANNUAL MEDIA CONFERENCE | 9 MARCH | ©2016 ASCOM 16
Slide 17: Screen shots application workflow
Screen shots application workflow Patient selected Parameters menu Work in progress, overview (dynamic, customizable) heart rate ANNUAL MEDIA CONFERENCE | 9 MARCH | ©2016 ASCOM 17
Slide 18: Neonatal intensive-care units – Eliminating feeding errors
Neonatal intensive-care units – Eliminating feeding errors Mother’s Milk eliminates feeding errors in neonatal intensive-care units (NICU) through mobile barcode scanners, printers and positive patient identification verification. Targeted segment is Healthcare-Hospitals, clinics, NICU. Main feature
Slide 19: Screen shots application workflow
Screen shots application workflow If the match is incorrect, the above Select infant wristband Scan milk bottle to screen will show the misidentification, to identify patient. verify a match. preventing feeding errors. ANNUAL MEDIA CONFERENCE | 9 MARCH | ©2016 ASCOM 19
Slide 20: Wireless Solutions is well under way
Wireless Solutions is well under way • Healthcare part of the business is growing above average • The non-health care part of the business remains important, but the strategic focus is on healthcare, where we see the best growth opportunities • North America has recovered and showed impressive growt
Slide 21: Network Testing
NETWORK TESTING ANNUAL MEDIA CONFERENCE | 9 MARCH | ©2016 ASCOM 21
Slide 22: Ranplan partnering improves market position of Network Testing
Ranplan partnering improves market position of Network Testing • In-building and small cells increasing rapidly to meet capacity demands • Number and location of sites makes rollouts costly and hard to manage • Ranplan partnering gives Network Testing exclusive ability to integrate, market and sell
Slide 23: Network Testing with exclusive access to China Mobile
Network Testing with exclusive access to China Mobile • China Mobile, the worlds largest wireless operator, in 2015 selected only 3 partners to provide network testing solutions for LTE and VoLTE deployments • Based on extensive evaluations Network Testing was the only non-Chinese vendor selected •
Slide 24: Service assurance business reflects market growth
Service assurance business reflects market growth • Complex networks are difficult to test – end-user experience is true measure • Diverse services are impacted by various degradations and failures that need to be identified in order to solve performance problems for operators • Service assurance so
Slide 25: VoLTE-Testing is a key business driver for Network Testing
VoLTE-Testing is a key business driver for Network Testing • Deploying “Voice over LTE” (VoLTE) is key to increase the network efficiencies • Due to the variety of implementations from multiple vendors deployment is not easy to manage • VoLTE-related support and expertise from Network Testing is a k
Slide 26: 2015 Financial Results
2015 Financial Results Bianka Wilson ANNUAL MEDIA CONFERENCE | 9 MARCH | ©2016 ASCOM 26
Slide 27: 2015 results at a glance
2015 results at a glance NT WS Division WS North Net WS -4.5% cc Acute America revenue Division Care +18% cc CHFm +3.7% cc +8% cc 410.8 Backlog (end of 2015) WS CHFm Division 135.2 +7.1% cc Ascom EBITDA Group margin NT EBITDA WS margin (before Division Division restructuring) 10.7% 15.0% (before 11.
Slide 28: Conversion to Swiss GAAP FER
Conversion to Swiss GAAP FER Equity Goodwill offset to equity and limited P&L impact ratio (end of 2015) (CHFm) 40.7% Adjustments in equity per 31.12.2014 Adjustments in Group profit for the period of 2014 242.9 -169.0 -0.2 4.6 107.9 38.5 29.6 -0.9 -0.2 0.1 37.5 Share- Goodwill Pension Other Deferre
Slide 29: Growth analysis
Growth analysis (CHFm) 2014 Organic M&A FX 2015 ∆ 15/14 Incoming Wireless Solutions (WS) 333.3 +1.5% +0.2% -8.2% 311.8 -6.5% orders Network Testing (NT) 117.3 -8.6% 0.0% -5.2% 101.1 -13.8% Ascom Group 450.4 -1.2% +0.2% -7.4% 412.5 -8.4% (CHFm) 2014 Organic M&A FX 2015 ∆ 15/14 Net Wireless Solutions
Slide 30: WS Division – Net revenue development
WS Division – Net revenue development By customer segment By region (CHFm, % based on figures at actual currencies) 12% 5% 21% 3% 19% 5% 2015 2015 10% 304.2 304.2 60% 9% 19% 4% 17% 20% 10% 5% 15% 6% 19% 2014 2014 9% 318.9 20% 318.9 59% 21% 12% 20% ANNUAL MEDIA CONFERENCE | 9 MARCH | ©2016 ASCOM 30
Slide 31: WS – Profitability impacted by investments and FX
WS – Profitability impacted by investments and FX (CHFm, figures and % based on actual currencies) -1.7 6.1 -6.3 55.8 EBITDA bridge -4.7 -3.7 45.5 EBITDA Volume Gross* Invest- FX impact Others EBITDA 2014 margin ments 2015 * Mainly due to 2014 one-off’s and increased Corporate charges allocations AN
Slide 32: WS – Half-yearly seasonality
WS – Half-yearly seasonality (CHFm, figures and % based on actual currencies) 52.6% 51.1% 49.9% 49.5% 178.1 157.0 147.2 140.8 Half-yearly 22.7% view 15.5% 14.4% 11.0% 1) 2) H1/2014 H2/2014 2) H1/2015 1) H2/2015 Gross margin EBITDA margin Net revenue H1 Net revenue H2 1) Figures according to IFRS 2)
Slide 33: NT – Net revenue development
NT – Net revenue development By customer segment By region (CHFm, % based on figures at actual currencies) 12% 13% 12% 37% 2015 44% 20% 2015 107.0 15% 107.0 11% 34% 32% 11% 2014 30% 21% 2014 47% 119.0 119.0 27% 34% ANNUAL MEDIA CONFERENCE | 9 MARCH | ©2016 ASCOM 33
Slide 34: NT – Profitability impacted by difficult H2 and restructuring
NT – Profitability impacted by difficult H2 and restructuring (CHFm, figures and % based on actual currencies) Testing EBITDA business Bridge (as reported) TEMS (pro forma) 7.5% 60% Pro forma TEMS gross EBITDA margin 10.6 margin 2015 2015 -2.7 2015 EBITDA before re- TEMS 2.6 -4.0 adversely impacted
Slide 35: NT – Half-yearly seasonality
NT – Half-yearly seasonality 51% Full year gross (CHFm, figures and % based on actual currencies) margin excluding restructuring 54.2% 54.4% 54.0% 46.0% Half-yearly view 12.6% 4.3% 2.7% 0.6% -2.8% Full year EBITDA margin 66.3 52.7 54.6 52.4 before restucturing 1) 2) 1) 2) H1/2014 H2/2014 H1/2015 H2/
Slide 36: EBITDA to group profit reconciliation
EBITDA to group profit reconciliation Depreciation and amortization key driver (CHFm, figures and % based on actual currencies) 43.8 -16.5 -1.7 6.1 0.4 -7.8 24.3 EBITDA Depreciation / Non-core Real- Net FX gains Net interest and Income tax Group profit 2015 amortization estate activities other finan
Slide 37: Solid cash flow generation as basis for growth
Solid cash flow generation as basis for growth Investments and dividends financed by operating cash flow (CHFm, figures and % based on actual currencies) -10.1 -13.3 43.4 -3.0 -15.8 57.4 50.2 6.0 Cash at Oper. cash Income tax CapEx Net debt Dividends Other cash Cash at 1.1.2015 flows excl. tax paid
Slide 38: Healthy balance sheet
Healthy balance sheet Improved balance sheet quality, re-financing in progress (CHFm, % based on figures at actual currencies) Key balance sheet positions Net cash/debt and equity ratio 100 60 80 40.7% 40 34.4% 60 20 37.3 40 27.1 20 0 0 -20 -20 -40 -40 31.12.2014 31.12.2015 31.12.2014 31.12.2015 NWC
Slide 39: Return to shareholders
Return to shareholders Dividend per share proposed at CHF 0.45, continuing the commitment to cash return (CHF, % based on figures at actual currencies) Basic earnings per share (EPS) Dividend per share Pay-out ratio ** 39%* 43% 67% 1.07 1.07 proposed 0.69 0.40 0.45 0.45 2013 * 2014 2015 2013 * 2014
Slide 40: Outlook
OUTLOOK ANNUAL MEDIA CONFERENCE | 9 MARCH | ©2016 ASCOM 40
Slide 41: Outlook
Outlook Wireless Solutions • Revenue growth 2016/17 5 – 10%* • EBITDA margin 2016/17 14 – 18% • We expect for 2016 a distinctively stronger H2 *at constant currencies ANNUAL MEDIA CONFERENCE | 9 MARCH | ©2016 ASCOM 41
Slide 42: Outlook
Outlook Network Testing • Progressing on evaluation of strategic options • Restructuring already implemented • Return to growth combined with significant improvement in profitability for the full year • Expecting for 2016 a clearly stronger second half-year ANNUAL MEDIA CONFERENCE | 9 MARCH | ©2016
Slide 43: Key priorities for 2016
Key priorities for 2016 Wireless Solutions Division Network Testing Division • Accelerate the transformation towards a • Complete evaluation of strategic options for Solution Provider for workflow intelligence in Division Healthcare • Return to profitable growth • Grow Solutions business with Myco,
Slide 44: Solid shareholder return
Solid shareholder return Proposal to the Annual General Meeting 2016: • Pay-out of a dividend of CHF 0.45 per share • Dividend yield of around 3% for 2015 • Pay-out ratio of 66.7% (2014: 43.2%) ANNUAL MEDIA CONFERENCE | 9 MARCH | ©2016 ASCOM 44
Slide 45: ASCOM 2020 – Accelerate, Innovate, Deliver
ASCOM 2020 – ACCELERATE, INNOVATE, DELIVER ASCOM 2020 Leveraging 2015 >25% of investments a strong Revenue to accelerate platform for from business growth Connectivity growth Software ASCOM 2020 >75% of ASCOM Revenue 2020 from Healthcare ASCOM 2020 Creating >50% of Focusing on sustainable, revenue f
Slide 46: Thank you
THANK YOU ANNUAL MEDIA CONFERENCE | 9 MARCH | ©2016 ASCOM 46
Slide 47: Legal Disclaimer
Legal Disclaimer This document contains specific forward-looking statements, e.g. statements including terms like “believe”, “expect” or similar expressions. Such forward-looking statements are subject to known and unknown risks, uncertainties and other factors which may result in a substantial dive
Slide 48: Ascom Holding AG
Ascom Holding AG Zugerstrasse 32 Baar, Switzerland www.ascom.com Phone: +41 41 544 78 00 www.linkedin.com/company/ascom ANNUAL MEDIA CONFERENCE | 9 MARCH | ©2016 ASCOM 48