Presentation third quarter 2013 8 November 2013
Agenda Highlights • Strategic change • Operations Financial review Order book Goodtech – in brief Outlook • Growth plan
2
Highlights, strategic change evaluated Structual change evaluated: • Potental sale of Installation and Power business in Sweden(GIAB) • Process trigged by indicative offer from industrial investor • Indicative offer opened for other actors to give indicative price • Letter of Intent
• Bid process cancelled 14 October • Did not reach acceptable terms
Goodtech is now focusing on fulfilling recently released growth strategy
3
2013-11-07
Highlights – Strategic change - growth strategy Goodtech launches new growth strategy • Organic growth in business areas where Goodtech has strong position and positive market expectations • Expect strong market drivers within some market segments which is basis for three separate strategic initiatives • Energy / Power • Aquaculture • Oil & Gas
4
2013-11-07
Highlights, third quarter 2013 Turnover increased with 10,1 % to MNOK 596,2 in Q3 compared with Q3 2012 Turnover YTD increased accordingly 16,1 % to MNOK 1.818,7 EBITDA MNOK 26,7 (4,5%) in Q3, compared with MNOK 28,2 in Q3 2012 (5,2%) EBITDA YTD has increased to MNOK 74,5 (4,1%) from MNOK 50,3 (3,2%) in 2012 Strong improvement in earnings before tax, from MNOK 29,8 YTD 2012 to MNOK 50,9 YTD 2013 Order backlog of MNOK 1.333 at the end of Q3 2013, compared with MNOK 1.125 at the end of Q3 2012
5
Highlights, third quarter 2013 Continue with action plan in Solutions to improve earnings • Continuous improvement of systems and routines to increase margins and improve quality • Ongoing implementation of ERP system and improving Project Execution in Solutions and Environment • Cost reduction • Employed new managers and key personnel Successful completion of several larger projects
6
Highlights, third quarter 2013, Market Order backlog stabilized on a high level. MNOK 1.333, 18 % increase compared with Q3 2012 Some contracts in Q3: • MSEK 31,5 Infrastructure power contract to LKAB.
7
•
MSEK 22,5 Installation contract to Merttainen mine, LKAB
•
MSEK 16,3 Maevaara Wind power plant – Power Substation
•
MSEK 15,0 Power supply / Installation contract – Gällivare hospital
•
MNOK 23,5 Pretreatment plant for Biogas for Sydskånes Avfallsaktiebolag
•
MSEK 15,0 Automatic Warehouse system for Plastal AB
Highlights, third quarter 2013, Market Significant contracts won after Q3
8
•
MSEK 107 power transmission turn-key contract with Svenska Kraftnät, Karlslund 400 kV
•
MSEK 34,6 in new contracts within production lines and automatic warehouse after Q3
Financial Review
9
Main figures (NOK 1.000) Revenues
YTD 13
YTD 12
Q3 13
Q3 12
2012
1 818 745
1 565 883
596 227
541 317
2 179 002
Product expenses
910 452
742 571
308 231
266 623
1 030 026
Salary expenses
655 160
591 210
205 095
183 610
821 407
Other operating expenses
178 667
181 770
56 209
62 845
250 908
74 465
50 332
26 693
28 240
76 661
EBITDA EBITDA %
4,1 %
3,2 %
4,5 %
5,2 %
3,5 %
Depreciation
17 595
17 080
5 924
5 698
22 854
2 391
0
2 391
0
0
EBIT
54 479
33 251
18 377
22 542
53 808
Net financial item s
-3 607
-3 469
-1 758
-2 443
-3 639
39
0
0
0
1 047
Profit before taxes
50 911
29 782
16 619
20 098
51 215
Taxes
11 318
8 339
3 478
5 628
-76
Net result from continuing operations
39 593
21 443
13 140
14 471
51 291
0
219
0
73
3 159
39 593
21 662
13 140
14 544
54 450
39 342
21 640
13 114
14 515
54 428
252
21
27
29
22
Non recurring item s
Share of Profit from Associated comp.
Net income/loss from discontinued operation Net result Attributable to: Ow ners of the parent Non-controlling interests Sum
10
39 593
21 662
13 140
14 544
54 450
Earnings per share from continuing operations
1,22
0,66
0,41
0,45
1,58
Deluted earnings per share
1,22
0,66
0,41
0,45
1,58
Quarterly revenues and earnings - historical
700
30
Revenues
500
25
MNOK
MNOK
600
20
400 15
300 10
200
100
5
‐
‐
11
EBITDA
Financial highlights – Balance sheet NOK m illion
30.09.13
Fixed tangible assets
30.09.12
31.12.12
51,2
47,9
46,7
Intangible Assets
685,3
648,3
645,8
Total Fixed Assets
736,5
696,2
692,5
27,9
27,7
82,9
705,2
681,0
668,0
Cash Other Current Assets Total Current Assets Total Assets
733,1
708,7
750,9
1 469,6 -
1 404,9 -
1 443,3
Total equity
716,4
660,0
687,8
Long Term Liabilities Interest Bearing
46,6
130,3
113,2
Other Long Term Liabilities
15,4
15,9
10,9
Current Liabilities Interest Bearing
153,2
67,7
25,8
Other Current Liabilities
538,0
531,0
605,6
Total Equity and Debt
1 469,6
1 404,9
1 443,3
Net Interest Bearing Debt
171,9
170,3
56,1
Equity Ratio (%)
48,7 %
47,0 %
47,7 %
Net Gearing (%)
24,0 %
25,8 %
8,2 %
1,1
1,2
1,2
Liquidity Ratio Definitions: Net Gearing (%): Net interest Bearing Debt/Total equity Liquidity Ratio : Current Assets/Current Liabilities
12
Financial highlights – Cash flow NOK 1.000
YTD 13
YTD 12
Q3 13
Q3 12
2012
Cash flow from operations
-45 607
5 897
-25 164
-51 802
115 593
Cash flow from investments
-11 272
-8 117
-8 473
-4 025
-7 221
Cash flow from financials
-134 721
-46 852
-8 035
-7 325
-59 142
Net changes in cash from period
-191 600
-49 072
-41 672
-63 152
49 230
82 857
32 973
-64 136
47 326
32 973
Net Cash funds at beginning of period Effects of exchange rate fluctuation on cash held
4 943
994
2 008
722
654
-103 800
-15 104
-103 800
-15 104
82 857
27 935
27 684
27 935
27 684
82 857
Overdraft facility
-131 735
-42 788
-131 735
-42 788
0
Net Cash funds at end of period
-103 800
-15 104
-103 800
-15 104
82 857
Net Cash funds at end of period *) *) Consisting of Cash and cash equivalents - balance sheet
Undraw n credit facilities amounts to MNOK 125,4 at the end of Q3 13
13
Cash flow from operations and EBITDA Development in Cash flow from operations and EBITDA on 12 months rolling basis
150 000
100 000
50 000
Cash flow from operations 12 months rolling basis EBITDA 12 months rolling basis
0 Q3 2011 -50 000
-100 000
14
Q4 2011
Q1 2012
Q2 2012
Q3 2012
Q4 2012
Q1 2013
Q2 2013
Q3 2013
Employees per business area 1 800 1 600 1 400 1 200 1 000 800 600 400 200 ‐
Projects & Services
Infra
Solutions
Environment
Products
Total no. of employees by 30.06.2013: 1508 15
Admin
Order backlog 1 400
1 200
MNOK
1 000
800
600
400
200
‐
Projects & Services
16
Infra
Solutions
Environment
Products
Business areas – figures and facts
Projects & Services
17
Infra
Solutions
Environment
Products
Business unit: Projects & Services (P&S) 450
Revenue EBITDA EBITDA margin % Order backlog No. of employees
YTD 13
YTD 12
Q3 13
Q3 12
2012
1 179 577
1 016 135
391 671
353 563
1 424 007
62 754
22 749
24 788
17 170
44 587
5,3 %
2,2 %
6,3 %
4,9 %
3,1 %
795 482
537 869
795 482
537 869
618 134
1 206
1 154
1 206
1 154
1 101
Revenues
400 350 MNOK
NOK 1.000
300 250 200
Highlights
•
• • • •
P&S business unit has performed very well in the quarter Turnover increased with 10,8 % in Q3 compared with Q3 2012. YTD turnover has increased 16,1 % compared with 2012 EBITDA increased with 44,4 % in Q3 2013 compares with Q3 2012. EBITDA has increased to MNOK 62,8 YTD compared with MNOK 22,7 YTD 2012 Margin has improved to 6,3% in Q3 2013 and 5,3% YTD. Order backlog increased 47,9% compared with Q3 last year Won MSEK 107 contract with Svenska Kraftnät after Q3 P&S workforce is gradually increasing
100 50 ‐
30
EBITDA 25 MNOK
• •
150
20
15
10
5
‐
(5)
18
Business unit: Infra NOK 1.000
YTD 13
YTD 12
Q3 13
Q3 12
2012
Revenue
224 428
138 822
73 482
50 995
204 142
7 735
2 923
1 096
1 226
4 937
90
EBITDA margin % Order backlog No. of employees
3,4 %
2,1 %
1,5 %
2,4 %
2,4 %
80
347 389
330 439
347 389
330 439
291 906
70
65
52
65
52
54
MNOK
EBITDA
100
60
Highlights
•
• •
Infra business is increasing. Turnover increased with 44,1 % in Q3 2013 compared with Q3 2012, and 61,7% YTD 2013 compared with YTD 2012 EBITDA Q3 is on same level as 2012. EBITDA YTD 2013 more than doubled compared with YTD 2012. Margin low in Q3 but increased to 3,4% YTD compared to 2,1 % YTD 2012 Reservations related to one specific project has reduced earnings High activity level • •
• •
19
Executing larger projects. Infra has passed critical milestones in some projects in the period Continues to employ more personnel
Order backlog is still on a high level due to strong order intake in 2012 / 2013 Market look promising in the longer perspective
50 40 30 20 10 0
7
6
MNOK
•
Revenues
5
4
3
2
1
0
EBITDA
Business unit: Solutions YTD 13
YTD 12
Q3 13
Q3 12
2012
Revenue
152 911
196 521
43 094
70 797
256 843
EBITDA
-5 287
9 041
-2 199
1 815
8 455
EBITDA margin %
-3,5 %
4,6 %
-5,1 %
2,6 %
3,3 %
Order backlog
49 060
96 691
49 060
96 691
71 733
145
146
145
146
145
No. of employees
80
Revenues
70 60
MNOK
NOK 1.000
50 40
Highlights
30
•
20
• •
•
•
‐
4
3
2
1
Further corrective actions have been taken to improve earnings • •
•
Cost due to lack of quality in projects within timber handling and weak performance in production lines projects
10
MNOK
•
Won new orders in, and after Q3 -MSEK 15,0 Automatic Warehouse system for Plastal AB -MSEK 34,6 in new contracts within production lines and automatic warehouse after Q3 Largest production line delivered by Solutions has been approved and taken over by customer. Delivered on schedule Very positive feedback from customer Turnover in Q3 2013 lower than Q3 2012 EBITDA margin in Q3 and YTD is negative
Project management has been strengthened. Change of management personnel Implementation of new project admin system ongoing
Market outlook is in general positive, several prospects. Full focus on Market and Sales
‐
(1)
(2)
(3)
20
EBITDA
Business unit: Environment YTD 13
YTD 12
Q3 13
Q3 12
2012
90
Revenue
213 207
175 237
75 786
58 026
239 282
80
EBITDA
9 377
13 045
3 560
6 470
17 088
70
EBITDA margin %
4,4 %
7,4 %
4,7 %
11,2 %
7,1 %
132 253
151 430
132 253
151 430
147 820
78
70
78
70
71
Order backlog No. of employees
MNOK
NOK 1.000
Revenues
60 50 40
Highlights •
•
30
Turnover increased with 30,7 % in Q3 2013 compared with Q3 2012. YTD 2013 increased with 21,7% compared with YTD 2012
20 10 ‐
Drop in EBITDA in Q3 - Implementation of ERP and moving to new offices as part of growth strategy
7
causes some extra cost and drop in EBITDA - Lower sale of Biovac® in Q3
•
Environment, larger project business is performing well with increasing turnover Order backlog still on a high level
MNOK
•
6
5
4
3
2
•
Lower activity in the Norwegian SBR / Biovac® market in Q3 - Postponed public orders in certain geographical areas
•
Increasing activities in Swedish market continues looks promising
1
‐
21
EBITDA
Business unit: Products YTD 13
YTD 12
Q3 13
Q3 12
2012
Revenue
69 374
58 490
18 994
15 800
80 082
EBITDA
6 547
6 848
1 575
2 514
8 766
EBITDA margin %
9,4 %
11,7 %
8,3 %
15,9 %
10,9 %
Order backlog
8 881
8 246
8 881
8 246
13 496
23
23
23
23
22
No. of employees
30
Revenues
25
MNOK
NOK 1.000
20
15
Highlights
•
Turnover increased with 20% in Q3 2013 compared with Q3 2012. YTD 2013 increased with 18,6% compared with YTD 2012
5
‐
EBITDA lower in Q3 2013 compared with Q3 2012, but EBITDA margin is still good with 8,3% in Q3 and 9,4% YTD 2013
•
Implementation of new ERP system has been completed
•
Positive market outlook
4
EBITDA
MNOK
•
10
3
2
22
•
OEM and System Integrator business is performing well.
•
Well established market position within several markets
•
High activity level in the market in some segments in Q3
•
Increasing sales force = increasing activity
1
‐
Goodtech – in brief: ” Goodtech shall be the leading supplier of automation, electrical, process, industrial engineering, and environmental solutions in the Nordic region.”
A considerable technology group - background Turnover increased from MNOK 130 in 2005 to MNOK 2.179 in 2012 Norsk Elektrisk Kabelfabrikk A/S founded
1913
New name: Goodtech Business idea: Environmental tech
1993
Includes automation and material handling into the business idea
2006
El & Industrimontage Svenska AB and Goodtech ASA merge into the ”New” Goodtech
El & Industrimontage AB founded 1994
2010 2013
MNOK
TURNOVER
YEAR
24
Goodtech in brief Approx 1.500 employees, with a revenue of NOK 2,2 billion Strong local presence with 39 offices in Sweden, Norway and Åland Headoffice in Oslo and listed on Oslo Stock Exchange Sweden Approx 1.170 employees 27 offices, from Kiruna in the north to Malmö in south Norway Approx 290 employees 10 offices, with headoffice in Oslo Åland Approx 40 employees Office in Mariehamn
25
Market drivers
Upgrade of infrastructure and energy systems
26
Increased efficiency and competitive ability within the industry
Society’s need for more environmental friendly solutions, products and projects
Organisation Goodtech is organised into five business areas • Projects & Services • Infra • Solutions • Environment • Products
Projects & Services
Infra
Solutions
Environment
Products
27
Solid service and product portfolio
Automation
Power technology
Installation
Industry technology
•
Innovative technologies and solutions
•
Turn-key projects
•
Broad specter of services and competence
Environment technology
28
Market segments
Energy
Wastewater & Biogas
Infrastructure
Public buildings
Oil & Industry
29
Gas
Highlights – Technology development Dedicated technology development activities in Solutions • Technology is platform for winning of several contracts lately Develop technology and standardized solutions to stimulate to repeat business in all business units Technology will be platform for part of growth strategy Negotiation of technology agreement with Dubal for Energy Recovery
30
Commercial and financial risks for Goodtech Commercial and market risk • •
Market for Industry projects and solutions – some risk Market for Infrastructure projects and solutions – some risk
Financial risks • • • •
In general small currency exposure In general small risk for contract cancellation In general small risk for loss on receivables In general some risk related to projects
Turn-key projects and deliveries •
Some risk related to project execution • Various complexity, size and duration of projects • Shortage of Project Managers
•
Reducing risk: • MQSP (Method, Quality, Safety and Procurement) department focus on training, improvement of methods and quality • Training Project managers and employments ongoing
Technology and product development •
31
Some risk related to technical issues and market positioning
Outlook 2013 - 2014
32
Outlook - Market Expect continuous upgrade and large investments within infrastructure, energy and oil & gas In general, promising markets for Goodtechs services, solutions and products – basis for organic growth The uncertainty in some markets due to uncertainty in the global economy seems to decrease. However still unpredictable
Brief market analysis: • • • • • • • •
33
Power and Energy market Infrastructure, railway/subway Industry, mines Industry, manufacturing Industry, paper Oil & Gas Industry Environment Public buildings
Summary / Outlook 2013 - 2014 Goodtech has improved operations – basis for further expansion • Well established in the Nordic market In 2013 - 2014 Goodtech shall build stronger positions within strategic areas • Continue to build the Goodtech brand • Organic growth – main focus • Long term strategic focus – build position within defined markets • Power (energy), Aquaculture, Oil & Gas
• Use customer focus and well established market position to increase business • Use of own product technology and technical competence • Open for non-organic growth within certain areas, consolidation possibilities in the market Maintain active dividend policy
34
The Goodtech Way!
Your success – our goal! 35
