financial results of apator capital group 25.11 · financial results of apator capital group 2015...
TRANSCRIPT
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1 Financial results of Apator Capital Group – 25.11.2015
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Financial results of Apator Capital Group 2015
PLN ('000) 9M 2015 9M 2014
Change
y/y
Sales 556 091 517 480 7,5%
Gross profit on sales 151 857 154 627 -1,8%
Margin 27,3% 29,9%
Profit on sales 55 878 69 802 -19,9%
Margin 10,0% 13,5%
EBITDA 83 311 94 503 -11,8%
Margin 15,0% 18,3%
Net profit 49 451 60 045 -17,6%
Margin 8,9% 11,6%
• Significant increase of revenues y/y: – increase in line of electricity (high backlog), – increase in line of gas – impact of full consolidation of
GWI, – impact of consolidation of Elkomtech (PLN 9,7 m),
• Organic increase of sales at the level of 2,6%;
• Decrease of profitability of gross profit on sales: – loss in Apator Rector, – increase of material costs caused by the strengthening
of USD exchange rate ( circa PLN 7 m), – decrease of prices in lines of electricity and gas (high
competition), – change in product mix – increase of share of sales of
less profitable assortments, – situation in non-core entities,
• Increase of overheads:
– one time costs (advising), – consolidation of costs entities purchased: Elkomtech,
Miitors, GWi, – restructuring costs of Rector,
• Release of unnecessary provisions (PLN 3,4 m),
• Largest part of the profit EBITDA provided by metering
segment (79%);
• 44% of revenues of high margin of EBITDA (over 20%);
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Comparison of quarterly results in 2015
Good III quarter 2015: • The highest level of sales;
• Lower gross profit on sales caused by loss in
Apator Rector, after its elimination the profitability at the level of the first quarter;
• Control of costs – slow down of the decrease of profit margin on sales: − decrease of overheads, − maintenance selling costs,
• Increase of EBITDA margin and net profit :
− release of unnecessary provisions, − good results of financial activity
• After elimination of the impact of provisions released, net profit margin at the level of 8,6%;
PLN ('000) I quarter II quarter III quarter
Sales 180 909 183 599 191 584
Gross profit on sales 51 424 50 501 49 933
Margin 28,4% 27,5% 26,1%
Profit on sales 19 666 15 809 20 403
Margin 10,9% 8,6% 10,6%
EBITDA 27 751 23 408 32 153
Margin 15,3% 12,7% 16,8%
Net profit 16 681 12 854 19 917
Margin 9,2% 7,0% 10,4%
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3 330
4 066
48 798
41 402
0
10 000
20 000
30 000
40 000
50 000
60 000
Sales 9M2014 Mining Control Sales 9M2015
Sales - non core y/y
8 886
5 929 86 971
100 404
1 382
0
20 000
40 000
60 000
80 000
100 000
120 000
Sales 9M2014 Ap. Łącz. EKT ICT Sales 9M2015
Sales – grid segment y/y
19 585 18 031
5 041
381 711 414 286
0
50 000
100 000
150 000
200 000
250 000
300 000
350 000
400 000
450 000
Sales 9M2014 Woda Gaz Energia Sales 9M2015
Sales – metering segment y/y
7 396
13 433 32 575
517 480 556 091
0
100 000
200 000
300 000
400 000
500 000
600 000
Sales 9M2014 Metering Grid Non-Core Sales 9M2015
Sales pursuant to segments y/y PLN ‚000 PLN ‚000
PLN ‚000
9% 15% -15% 7,5%
Change 2015/2014 Change 2015/2014
-3% 18% 17% 9%
Change 2015/2014
12% 40% -9% 15%
PLN ‚000
-15% -15% -15%
Change 2015/2014
Sales 9M2014 Water Gas Energy Sales 9M2015
Sales 9M2014 Switchgear EKT ICT Sales 9M2015 Sales 9M2014 Mining Control Sales 9M2015
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Home - export (PLN ’000)
High sales on foreign markets;
Commentary
Slight decrease of share of export in revenues 45% vs 46% y/y;
Geographical structure of sales
Increase of domestic sales by 10% y/y:
Apator: PLN 15 m (high backlog); Elkomtech: PLN 9,7 m ( result of consolidation since the
beginning 2015);
Increase of sales to foreign markets by 4% y/y: impact of full consolidation of GWi – PLN 13 m; decrease of export to Russia by PLN 16 m; increase of export to EU by PLN 29 m;
55%
25%
5%
7% 8%
9M 2015
54%
21%
9%
6%
10%
9M 2014
Polska
UE
Rosja
Indie
Pozostałe
Poland
UE
Russia
India
Other
306 466 277 876
249 626
239 604
0
100 000
200 000
300 000
400 000
500 000
600 000
9M 2015 9M 2014
Home Export
556 091
517 480
Poland
UE
Russia
India
Other
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1 059
94 503
966 9 496
78 023
60 807
16 479
22 505
83 311 330
0
20 000
40 000
60 000
80 000
100 000
120 000
EBITDA 9M2014 Metering Grid Non-Core Koszty nieprzypis EBITDA 9M2015
EBITDA - Apator Capital Group y/y PLN ‚000
EBITDA Margins
15% 8% 17% 16% 19%
EBITDA 9M2014 Metering Grid Non-Core Unallocated costs EBITDA 9M2015
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Net debt (PLN ’000)
Working capital and debt
Increase of working capital: - acquisitions – PLN 6 m - Powogaz – PLN 7 m (decrease of liabilities with tax
ones included), - Rector – PLN 3 m (short term receivables)
Increase of net debt: - Increase of gross debt (acquisitions: Miitors, GWi), - Decrease of cash; Net debt/LTM EBITDA – 1,3 x;
202 993
165 590
186 235
0
50 000
100 000
150 000
200 000
250 000
30.09.2015 31.12.2014 30.09.2014
Working capital (PLN ’000)
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Capex (PLN ’000) Cash flow (PLN ’000)
Capex, cash flow
Conversion of EBITDA to cash 46%; Investment expenses (Miitors, Capex); Financial expenses (loans repayments, payment of
dividend);
Investment expenditure inccurried mainly for the development and automation of manufacturing processes : Capital Group of Metrix (PLN 10 m); Apator SA (PLN 10 m); Capital Group of Powogaz (PLN 5,8 m);
30 456
22 423
0
5 000
10 000
15 000
20 000
25 000
30 000
35 000
9M 2015 9M 2014
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Decrease of profitability y/y, main factors : Problems with Apator Rector – net loss of PLN 6,9 m;
USD exchange rate – increase of manufacturing costs;
Decrease of profitability in electricity and gas lines – increase of competition, decrease of prices;
Additional costs – acquisitions;
Build-up of Apator Capital Group – new competences obtained: Miitors – purchase of 100% shares;
Fellows – purchase and making contribution in kind to Apator Telemetria;
GWi - increase of package of shares to 100%;
Assessment of the situation of Apator Capital Group in 2015 : Steady situation of Apator Capital Group;
Good financial position:
– safe level of debt, correct liquidity – in 4 Q the surety will be released in amount of PLN 100 m related to the
purchase of Elkomtech;
– dividend policy continued – interim dividend payment of PLN 10 m (18th December 2015);
– investment possibilities in Capex and other entities;
In spite of lower profits than planned, results still distinguish positively Apator Capital Group on the market;
Summary of results
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Metering segment - metering line of electricity:
high backlog at home, intensive searching for the opportunities for export;
completion of works related to residential electricity meters with significant lower technical cost of manufacturing in the
first half 2016 ;
Smart City Wrocław project continued;
Metering segment – metering line of gas:
Dutch market – tender of Liander - contract concluded between GWi and L&G (EUR 8 m) and advanced negotiations
related to the contract to be concluded between Metrix and Flonidan (EUR 28 m) for 5 years;
further large tenders for smart gas meters (e.g. the United Kingdom);
intensive research and development – own smart gas meters, reducing technical cost of manufacturing of gas meters,
automation;
Metering segment – metering lines of water and heat:
increase of domestic sales,
increase of export – European Union, Russia;
expansion of product portfolio
– intensive studies on whole ultrasonic water meter family, launching of the first product since 4Q 2016;
– purchase of new communication technologies;
Automation of power grid operation segment:
development of products on smart grid market;
development of integrated IT solutions (Elkomtech and Rector), jointly selling;
Perspectives of development – market opportunities
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Improvement of financial results of Apator Rector – elimination of loss effect in 2015:
completion of performance of long-term contracts being settled according to IAS;
winning new customers and introduction of shorter periods of settlements;
restructuring of resources;
Optimization of the costs of activity:
in the area of technical cost of manufacturing – electronic and inductive electricity meters, gas meters;
overheads;
Hedging of currency exposure:
hedging policy of EUR and USD continued;
natural hedging ;
Integration processes of Apator Capital Group continued (e.g. IT, HR)
Perspectives of development – actions taken in 2015 continued
2016 – perspective of return to profitability of 2014 of Apator Group
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