Solar Group Update on our strategy and value drivers Group revenue and group EBITA in Q2 met expectations. Michael H. Jeppesen, Group CFO

Transcription

1 Solar Group Update on our strategy and value drivers Group revenue and group EBITA in Q2 met expectations Michael H. Jeppesen, Group CFO ABG Sundal Collier Q2 seminar, Copenhagen, 27 September 2012

2 Agenda Update on Solar s value drivers and Q2 results Group strategy #1 in Technical Wholesale Solar Blue Energy - our energy-efficient solutions Status of Solar 8000 (SAP) The results we expect in FY ABG Sundal Collier seminar 2

3 Update on Solar s value drivers Extraordinary focus on increasing short-term earnings Objectives Actual H Management agenda Organic growth 3.3% New and enhanced growth initiatives EBITA margin 1.4% Margin diluted approx. 0.7% by restructuring and Solar 8000 costs Net working capital <14% 14.6% Adjusted for acquisitions as at ROIC excl. amortisation 4.3% Equity ratio 35-40% 37.5% Gearing (NIBD/EBITDA) Dividend (payout ratio) 35-45% Value creation index* > Leadership index** > * Our internal KPI, measuring our ability to create value for our customers. Measured every 18 months. ** Our internal KPI, measuring leadership capabilities in Solar. >70 is considered excellent. Measured every 18 months. 3 ABG Sundal Collier seminar

4 Organic growth of 2.9% in Q adjusted for working days Revenue developed as expected Organic growth Q Q % Revenue m Revenue growth 15.3% 6.0% Organic growth 0.9% 3.7% 0.0 Q1 Q2 Q3 Q4 FY ABG Sundal Collier seminar

5 Strong growth in Denmark The markets in the Netherlands and Germany remain challenging Market update: In Denmark, we see increased business opportunities within renewable energy and energy efficiency. Our market position in Norway was improved again. The Dutch construction market continued to decline in Q2 and pricing-based competition was fierce. Our position remains unchanged. Solar Group Q million Revenue Organic growth Solar Danmark A/S % Solar Sverige AB % Solar Norge AS % Solar Nederland* 94.2 (7.6%) Claessen ELGB, Belgium 8.8 Solar Deutschland** 34.8 (19.2%) GFI GmbH, Austria 13.3 Solar Polska Sp. z o.o % P/F Solar Føroyar 0.8 (2.1%) Aurora Group % Eliminations (1.9) Total % 5 ABG Sundal Collier seminar * Includes figures for Conelgro B.V., acquired on 30 September ** Includes figures for GFI Gesellschaft für Installationstechnik, acquired on 30 September 2011.

6 Q2 EBITA was up 2.1m compared to Q and EBITA matched expectations EBITA margin % % (0.1) (0.1) Q COGS EOC Staff Debtors Deprec. Q Q1 Q2 Q3 Q4 FY Solar 8000 costs of 2.6m in Q and 1.6m in Q Restructuring costs of 1.0m. Normalised EBITA of 6.7m. Q Q Revenue m Revenue growth 15.3% 6.0% Organic growth 0.9% 3.7% Gross profit m Gross profit margin 21.1% 20.5% EBITA m EBITA margin 0.8% 0.3% 6 ABG Sundal Collier seminar

7 NIBD up by 27.2m Adjusted for acquisitions in September 2011, NWC was 14.6% Net working capital (NWC) Net interest-bearing debt (NIBD) million 310 % of revenue 21 million 280 No. of times 3.5X Acquisition of Vegro and Eltomont Acquisition of operations from Otra Acquisition of enterprises in NL, BE, DE, AU Acquisition of Vegro and Eltomont Acquisition of operations from Otra Acquisition of enterprises in NL, BE, DE, AU 3.3X 3.1X 2.9X 2.7X 2.5X 2.3X 2.1X 1.9X 1.7X Q Q Q Q X NWC NWC/Revenue, LTM NIBD NIBD/EBITDA, LTM Net working capital impacted by the 30 September 2011 acquisitions. Gearing up to 2.2 from 1.8 in Q due to net working capital. 7 ABG Sundal Collier seminar

8 Cash flow from operating activities affected by NWC in Q2 in Solar Nederland by 8m and Solar Norge by 12m Cash flow Cash flow from operating activities million (17.4) million 10 5 (1.2) (3.5) 1.2 (12.8) (17.4) (4.2) (7.3) (8.0) (6.3) Operating activities Investing activities Financing activities Net profit Depr. & amort. Tax & adj. Inventory Receiv. Liab. Oper. act. Adjusted net working capital at 14.6%, down from 15.0% in Q ABG Sundal Collier seminar

9 Group Strategy Strong focus on execution of company programmes Group Company Programmes To reach its financial objectives, Solar is continuing its Company Programmes to ensure execution through organisational commitment. 10 strategic initiatives have been selected as medium-term key drivers to reach the group s objectives. Group Company Programmes for are expected to be released in connection with the Q3 report Growth Technical wholesaler Climate & energy / Blue Energy Utility & infrastructure Facility management / maintenance, repair & operation (MRO) Solar Consulting Efficiency Solar 8000 Value realisation E-business People Employer branding Competence communities 9

10 Solar s business areas are within: Electrical - HVAC&R - Plumbing - Renewable Energy Marine & Installation Cables Offshore Lighting Industry Communication Security Ventilation Heating, Water & Sanitation Renewable energy

11 Solar delivers products and solutions to customers within: Residential and Commercial Buildings Industry Marine and Offshore Utility and Infrastructure Public Sector

12 With our Integrated Workflow System (IWS) we interact with customers Service concepts Touch points The IWS model is a mindset and communication tool. By using the model, we: Learn, listen and understand our customers needs, offer the best solutions to our customers and, work together with our customers to find the right integrated workflow solution. 12

13 Solar Blue Energy - making energy efficiency a better business A strategic focus area A sales, marketing and training concept One energy-efficient product is good an intelligent solution is better Focus on renovation projects through cases and cost-savings potential Cooperation between strategic suppliers and Solar The targets of the EU Climate and Energy Package are: a 20% reduction in EU greenhouse gas emissions based on 1990 levels by % of EU energy to come from renewable sources by 2020 a 20% reduction in primary energy use through improved energy efficiency by 2020, compared with projected levels 13

14 Our energy-efficient solutions attract customers Blue Energy on Tour approx. 4,350 visitors in Q2 In Q2, we stepped up efforts to promote our Blue energy concept of energy-efficient solutions. Our Blue Energy truck is on tour to showcase the latest products and technologies. We demonstrate how end customers can heighten the energy-efficiency of their existing or new solutions and how technical contractors gain a share in this business potential. As the truck toured Denmark, Sweden and Norway in Q2, almost 4,350 persons visited it. The truck will visit 100 destinations in five countries: Denmark, Sweden, Norway, Germany and the Netherlands over a six-month period. 14 ABG Sundal Collier seminar

15 Status on Solar 8000 (SAP) A smooth roll-out in Solar Nederland was handled in June Solar 8000 was implemented in Solar Nederland in June as planned. The roll-out was satisfactory and implementation/financial closing of Q2 was achieved without any major interruptions. We expect to roll out in Solar Danmark around the turn of the year. Next, we will roll out in Solar Sverige, and Solar Deutschland, the last major Solar enterprise to move to SAP, will follow later in Following the satisfactory roll-out in Solar Nederland, our core Solar 8000 organisation has been streamlined to fit the need for roll-out in the remaining countries. We expect to roll out in the remaining countries without any major interruptions. We still expect the overall investment to total 55m. 15 ABG Sundal Collier seminar

16 Guidance 2012 Expectations for 2012 are maintained Expectations for 2012 are maintained at revenue of 1,660-1,720m and EBITA of 44-55m.* Normalised EBITA is expected at 54-65m when adjusted for restructuring and Solar 8000 roll-out costs. Net working capital below 14% at yearend and equal to approx. 14% on average in Revenue million E low 2012E high Revenue EBITA EBITA million E Low 2012E High Revenue m 1,660 1,720 EBITA m * We have chosen not to adjust our 2012 expectations to match the present high exchange rates on SEK, NOK and PLN. Should these exchange rates remain at their present levels throughout 2012, we expect the translation of our enterprises results from SEK, NOK and PLN into euro to impact revenue and EBITA positively by approx. 25m and approx. 1m, respectively. 16 ABG Sundal Collier seminar