HY1 2012 Results u-blox Holding AG• EBIT margin of 15.2% with growth of 6.1% compared to H1/2016...

locate, communicate, accelerate

H1/2017 Results u-blox Holding AG

August 24, 2017

Thomas Seiler, CEO

Roland Jud, CFO

© u-blox Holding AG, August 25, 2017

Disclaimer

Slide 2

This presentation contains certain forward-looking statements. Such forward-looking

statements reflect the current views of management and are subject to known and

unknown risks, uncertainties, assumptions and other factors that may cause actual

results, performance or achievements of the Group to differ materially from those

expressed or implied herein.

Should such risks or uncertainties materialize, or should underlying assumptions prove

incorrect, actual results may vary materially from those described in this presentation.

u-blox is providing the information in this presentation as of this date and does not undertake any obligation to update any forward-looking statements contained in it as a

result of new information, future events or otherwise.


Agenda

• Operational highlights H1/2017

• Financial results H1/2017

• Business review

• Outlook

• Q&A

Slide 3

Operational highlights H1/2017

• 7.9% revenue increase as compared to the first half of 2016

• EBIT margin increased in line with business growth

• Cash flow from operating activities declined

• Revenue and EBIT guidance maintained

• Strong product innovation

• 8 new cutting-edge products launched

• Continued investment in R&D

© u-blox Holding AG, August 25, 2017Slide 4

u-blox group H1/2017


Change H1/2017

over H1/2016

Revenue 193.9m - 7.9%

Gross profit 87.4m 45.1% 5.9%

EBITDA 40.3m 20.8% 2.8%

Operating profit (EBIT ) 29.5m 15.2% 6.1%

Net profit, attributable to owners of

the parent 18.0m 9.3% -2.6%

Net cash generated from

operating activities 22.1m 11.4% -16.0%

Key figures Amount CHF In relation to

revenue

Remark: All numbers are IFRS based. Adjusted numbers shown on slide 15

Revenue and EBITDA


CommentsRevenue and EBITDA

• Business managed to profitable growth

• Continued organic growth of revenues (+7.9% compared to H1/2016)

• Currency impact on revenue

• to H1/2016 rates: -0.3%

• to guidance rates: -1.8%

270.0

338.3

360.2

161.9 179.7

193.9

58.6

78.7 81.8

36.5 39.1 40.3

0

50

100

150

200

250

300

350

400

2014 2015 2016 H1/15 H1/16 H1/17

Revenue EBITDA

(million CHF)(million CHF)

7.9%

Markets trends


Note: Estimate

• Consumer market growth with wearables and smart bikes

• Good progress in Automotive

• Industrial markets expanding in all applications

CommentsRevenue split per market for H1/2017

IndustrialConsumer

Automotive

Revenues by geography


Note: based on customers’ billing location

Growth in two geographic regions compared to H1/2016

• Asia Pacific +25.3%

• EMEA: +8.5%

• Americas: -20.7%

Growth in all geographic regions compared to H2/2016

• Asia Pacific +8.0%

• EMEA: + 9.1%

• Americas: +3.9%

CommentsRevenues by geographic region

0

50

100

150

200

250

300

350

400

2014 2015 2016 H1/15 H1/16 H1/17

APAC Americas EMEA

25%

48%

27%

178.4

25%

50%

25%29%

48%

23%

(million CHF)

7.9%

26%

46%

28%

25%

47%

29%

26%

21%

53%

Gross profit


• Increase in gross profit to CHF 87.4m in H1/2017

• Growth of gross profit of +5.9% compared to H1/2016

• Gross profit margin in H1/2017 was slightly lower compared to H1/2016 due to changes in the product mix

CommentsGross profit / Gross profit margin

122.7

155.0167.1

72.882.5 87.4

45.4% 45.8%46.4%

44.9%45.9% 45.1%

0%

10%

20%

30%

40%

50%

60%

0

20

40

60

80

100

120

140

160

180

2014 2015 2016 H1/15 H1/16 H1/17

Gross Profit % of revenue

5.9%

Shipments and ASP development


• Growth of both module and chip volume

• Shipments of new positioning platform u-blox 8/M8 strongly growing

GNSS chipsModules

Note: incl. ANTARIS-Chipset sales by Atmel

0

1

2

3

4

5

6

7

0

10

20

30

40

50

60

2014 2015 2016 H1/15 H1/16 H1/17

Antaris u-blox 5 u-blox 6

u-blox 7 u-blox 8/M8 ASP

(million pcs) (CHF)

55.0%

18.6%

0

2

4

6

8

10

12

0

5

10

15

20

25

30

2014 2015 2016 H1/15 H1/16 H1/17

Shipments modules ASP

(million pcs) (CHF)

6.0%

Global customer base


• Strong and stable customer base, serving now 5700 customers worldwide

• Continued wide spread over different applications and geographical regions

• No important customer dependency: Largest customer accounts for less than 5.3% of total revenue in H1/2017

• 10 biggest customers account for 33.9% of total revenue in H1/2017

CommentsNumber of customers totaling 80% of revenue

69 65

71

63 63

74

0

10

20

30

40

50

60

70

2014 2015 2016 H1/15 H1/16 H1/17

Distribution & marketing / Research & development


Research & development expensesDistribution & marketing expenses

24.5 27.7

32.0

13.3 15.9 17.2

9.1% 8.2%8.9%

8.2%8.8% 8.8%

0%

1%

2%

3%

4%

5%

6%

7%

8%

9%

10%

0

5

10

15

20

25

30

35

2014 2015 2016 H1/15 H1/16 H1/17

Sales & Marketing % of revenues

49.9

65.0

63.5

29.9 32.1 32.0

18.5% 19.2% 17.6% 18.5%

17.9%

16.5%

0%

5%

10%

15%

20%

25%

0

10

20

30

40

50

60

70

2014 2015 2016 H1/15 H1/16 H1/17

Research & Development % of revenues

Research & Development

67%

Sales, Marketing,

Support

18%

Logistics, Administration

15%

(Total FTE = 895)

161

End of H1/2017, FTE based

Employees


Average employee level (FTE based)Employee breakdown (end of H1/2017, FTE based)

Note: 76% of employees based outside Switzerland (spread over 18 countries) Note: Average number of employees (FTE = full time equivalent)

538

671

786

610

729

839

0

100

200

300

400

500

600

700

800

900

2014 2015 2016 H1/15 H1/16 H1/17

Income statement - IFRS


• Revenue increase of 7.9% from H1/2016 to H1/2017

• Increased gross profit by 5.9%

• OPEX 30.3% of revenue

• H1/2017: costs for share based payments in the amount of CHF 4.1m

• EBITDA with margin of 20.8%

• EBIT margin of 15.2% with growth of 6.1% compared to H1/2016

• Finance costs contain mainly unrealized foreign exchange losses, and interests for the bonds

• Tax rate of 21.2% compared to year end 2016 with 25.1%

• Net Profit margin of 9.3%

• EPS = CHF 2.61 (diluted EPS: CHF 2.57)

CommentsConsolidated income statement (condensed)

January - June Jan. - Dec.

(in CHF 000s) 2017 2016 2016

Revenue 193'908 179'688 360'230

Cost of sales -106'518 -97'205 -193'123

Gross profit 87'390 82'483 167'107

% gross profit margin 45.1% 45.9% 46.4%

Operating expenses -58'707 -55'856 -110'136

Other income 845 1'216 2'033

Operating profit (EBIT) 29'528 27'843 59'004

Financial income 309 123 4'337

Finance costs -6'979 -3'016 -1'653

Profit before income tax (EBT) 22'858 24'950 61'688

Income tax expense -4'846 -6'453 -15'488

18'012 18'497 46'200

Operating profit (EBIT) 29'528 27'843 59'004

Depreciation and amortization 10'730 11'301 22'762

EBITDA 40'258 39'144 81'766

Net profit, attributable to owners

of the parent

Income statement – Adjusted


January - June Adjustements January - June January - June

(in CHF 000s)

2017

(IFRS)

Share based

payments

Pension impact

based on

IAS-19

Non-recurring

expenses

Amortization

intangible assets

acquired

2017

(adjusted)

2016

(adjusted)

Revenue 193'908 193'908 179'688

Cost of sales -106'518 387 -106'131 -96'873

Gross Profit 87'390 387 0 0 0 87'777 82'815% gross profit margin 45.1% 45.3% 46.1%

Operating expenses -58'707 3'670 666 827 1'218 -52'326 -49'705

Other income 845 845 1'216

Operating profit (EBIT) 29'528 4'057 666 827 1'218 36'296 34'326% margin 15.2% 18.7% 19.1%

Financial income 309 309 123

Finance costs -6'979 -6'979 -3'016

Profit before income tax (EBT) 22'858 4'057 666 827 1'218 29'626 31'433

Income tax expense -4'846 -1'079 -5'925 -6'287

18'012 2'978 666 827 1'218 23'701 25'146

Earnings per share in CHF 2.61 3.44 3.72

Diluted earnings per share in CHF 2.57 3.39 3.62

Operating profit (EBIT) 29'528 4'057 666 827 1'218 36'296 34'326

Depreciation and amortization 10'730 -1'218 9'512 10'022

EBITDA1) 40'258 4'057 666 827 0 45'808 44'348% EBITDA margin 20.8% 23.6% 24.7%

Net profit, attributable to owners of

the parent

1)Management calculates EBITDA (earnings before interest, taxes, depreciation and amortization) by adding back depreciation and amortization to operating profit

(EBIT), in each case determined in accordance with IFRS.

Segment information


(in CHF 000s) 2017 2015 2016 2015 2017 2015 2016 2015 2017 2015

Revenue third 193'815 179'546 93 142 193'908 179'688 193'908 179'688

Revenue intragroup 12'172 14'944 12'172 14'944 -12'172 -14'944 0 0

Total revenue 193'815 179'546 12'265 15'086 206'080 194'632 -12'172 -14'944 193'908 179'688

EBITDA 39'728 36'098 367 3'244 40'095 39'342 163 -198 40'258 39'144

Depreciation -3'397 -3'063 -1'056 -923 -4'453 -3'986 - -4'453 -3'986

Amortization -6'253 -7'292 -24 -23 -6'277 -7'315 - -6'277 -7'315

EBIT

Financial income 309 123 309 123

Finance costs -6'979 -3'016 -6'979 -3'016

EBT -6'507 -3'091 22'858 24'950

June 30 Dec 31 June 30 Dec 31 June 30 Dec 31 June 30 Dec 31 June 30 Dec 31

2017 2016 2017 2016 2017 2016 2017 2016 2017 2016

Assets 273'901 242'879 26'644 21'366 300'546 264'245 172'213 160'627 472'759 424'872

30'078 25'743 -713 2'298

January - June January - June

28'04129'365 163 -198 29'528 27'843

January - June January - June January - June

Positioning and

wireless products

Wireless services Total segments Non-allocated/

eliminations

Group

Statement of financial position (1)


• Strong financial position with a liquidity(incl. marketable securities) of CHF 168.6m

• Inventory CHF 37.9m (Dec. 2016: CHF 31.6m)

• Trade accounts receivable increase towards December 2016

• Increased intangible assets due to capitalization of R&D expenses

• Goodwill (CHF 54.6m) slightly increased by CHF 0.5m as result of exchange rate changes mainly in GBP and EUR

CommentsConsolidated Statement of financial position (condensed)

June 30, Dec. 31, June 30,

(in CHF 000s) 2017 2016 2016

(unaudited) (audited) (unaudited)

ASSETS

Current assets

Cash and cash equivalents 163'785 149'545 107'265

Marketable securities 4'831 7'573 10'150

Trade accounts receivable 46'084 39'792 42'579

Other current assets 52'102 42'670 53'821

Total current assets 266'802 239'580 213'815

Non-current assets

Property, plant and equipment 15'570 15'774 13'785

Goodwill 54'621 54'104 55'160

Intangible assets 132'169 111'905 97'520

Financial assets 1'139 1'074 787

Deferred tax assets 2'458 2'435 7'079

Total non-current assets 205'957 185'292 174'331

Total assets 472'759 424'872 388'146

Statement of financial position (2)


• Trade accounts payable of CHF 17.7m

• Second bond of CHF 60m issued in April 2017(6 years, interest rate 1.375%)

• Non-current liabilities contain in addition to the bonds

• Deferred tax liabilities (CHF 1.3m),

• Employee benefits (pensions) (CHF 12.8m)

• Provisions (CHF 7.3m)

• Share capital increase due to exercise of options

• Equity reduced because of treasury shares purchased for option program (CHF 24.4m)

CommentsConsolidated Statement of financial position (condensed)

June 30, Dec. 31, June 30,

(in CHF 000s) 2017 2016 2016

(unaudited) (audited) (unaudited)

LIABILITIES AND EQUITY

Liabilities

Current liabilities 57'307 59'098 46'070

Non-current liabilities 140'676 81'047 88'072

Total liabilities 197'983 140'145 134'142

Shareholders’ equity

Share capital 6'238 6'152 6'125

Share premium 65'180 74'387 73'345

Retained earnings 203'358 204'188 174'534

274'776 284'727 254'004

Total liabilities and equity 472'759 424'872 388'146

Total equity

Statement of financial position


• Strong capital base

• Equity ratio of 58.1%

• Treasury shares for option program decreased equity by CHF 24.4m

• Equity ratio without treasury shares: 63.3%

CommentsTotal equity and equity ratio

213

248

285

218

254275

70.5%

64.2%67.0%

63.9% 65.4%

58.1%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

0

50

100

150

200

250

300

2014 2015 2016 H1/15 H1/16 H1/17

Total Equity Equity ratio

(million CHF) (% of total assets)

Statement of cash flows


CommentsConsolidated statement of cash flows (condensed)

Cash flow from investing activities:

• CHF -4.3m investments into property, plant and equipment (equipment, tools)

• CHF -26.7m investments into intangible assets (Software, capitalization of R&D)

• CHF 2.7m net proceeds from marketable securities

Cash flow from financing activities:

• CHF -14.5m dividend 2016 paid in May 2017

• CHF +5.4m capital increase from options

• CHF +59.3m issued bond April 2017

• CHF -24.4m purchase of treasury shares for employee share option program

Jan. - June 2017 Jan. - June 2016

(in CHF 000s) (unaudited) (unaudited)

22'061 26'256

-27'914 -19'622

26'021 -11'581

20'168 -4'947

149'545 112'387

-5'928 -175

163'785 107'265

Net increase/(decrease) in cash and cash equivalents

Cash and cash equivalents at

end of period

Net cash generated from operating activities

Net cash used in investing activities

Net cash provided by financing activities

Cash and cash equivalents at beginning of period

Effect of exchange rate fluctuations on cash and cash

equivalents

Business update

Product launches highlights


TOBY-L4The LTE module provides

a secure solution for automotive OEMs enabling data, voice, positioning, eCall and

advanced telematics.

SARA-S200This ultra small module offers significant size and cost savings for secure

and robust M2M and IoT

wireless applications.

VERA-P1The latest in a range of

automotive-grade transceiver modules that enables the next

generation of Advanced Driver

Assistance Systems.

UBX-M8230-CT Ground-breaking GNSS receiver chip for wearable applications offering a unique balance of performance and ultra-low power use.

NINA-W131 & NINA-W132Secure ultra low power Wi-Fi modules that efficiently integrate Wi-Fi connectivity into IoT

devices.

ZOE-M8GAn ultra-compact GNSS receiver module which

offers exceptionally high location accuracy especially designed for wearables, drones and

asset trackers.SARA-R410MThe world’s smallest quad-

band LTE module, ideal for diverse IoT and M2M

applications including smart cities, connected healthcare

and more.

JODY-W1

The automotive Wi-Fi & Bluetooth module enables real simultaneous dual band operation for faster Wi-Fi connectivity and is ideal for infotainment and telematics applications.

Customer highlights (1)


All products (Cellular, Short Range, Positioning) experienced strong traction

HMS Industrial Network,

Germany Wireless industrial bolt

Product: ODIN-W2 module

WHILL KK, Japan

Wheelchair featuring cloud

connectivity

Product: 3G Cellular

Module

HEX, Taiwan

Drone Navigation Kit

Product: NEO-M8P

Customer highlights (2)


Navilock, GermanyGNSS receiver series

Product: NEO-M8U

Digicom, ItalyNB-IoT products and solutions

Product: SARA-N2

Panasonic, JapanTablet

Product: NEO-M8

Strategic priorities 2017 (1)

Market position

Slide 25

Outlook 2017• Develop range of products aimed at replacing legacy

cellular technology in IoT applications calling for a long service life and low data rates.

• Introduce high-precision location technology to the mass market.

Outlook 2017• Develop low-data-rate NB1, M1 and RPMA modules for

IoT applications.• Offer tools and development environments that enable

shorter time to market.• Roll out u-blox’s principles for security across all products.

Technology & Innovation


Strategic priorities 2017 (2)

Slide 26

Operational excellence

Outlook 2017• Use economies of scale to reduce cost-to-revenue ratio as

company expands.• Exploit multiple sourcing agreements to make supply chain

more robust.

Outlook 2017• Build on relations with major global cellular operators

around low-data-rate products.• Continue to review potential acquisitions that will

strengthen our product portfolio and technology base, and extend global reach.

Strategic partnerships & acquisitionopportunities


Sapcorda (Safe And Precise CORrection DAta)

• Sapcorda Services GmbH is based in Berlin.

• Will distribute GNSS positioning services for high precision GNSS applications.

• Targeting mass market applications such as Automotive, Industrial & Consumer.

• Setup as a Joint Venture with u-blox, Bosch, Geo++, Mitsubishi Electric.

• Service to be sustained by the involved industry.

• No single partner has a majority share.

• Each partner has a strategic interest in Sapcorda’s services.

• Joint Venture announced on 8th August 2017.

• Closing expected for mid October 2017.


Sapcorda

• Sapcorda to distribute GNSS correction services to serve the mass market

• Global and continent wide coverage.

• One way communication (Broadcast) with satellite

& terrestrial internet communication channels.

• Open system: Available to all GNSS receiver

manufacturers.

• Targeted at OEMs and system integrators (B2B business model).

• Affordable for mass markets (e.g. Cars,

Surveying, Agriculture & Machine Control).


Communication

Satellite

GNSS receiver

Internet

SSR correction service

GNSS

Outlook

Financial performance and guidance 2017

Slide 30 © u-blox Holding AG, August 25, 2017

• Continued business growth in 2017 – unchanged guidance

• Impact by product mix on relative gross margin

• Natural hedging protects relative gross margin against foreign exchange variations

+10% of USD EUR GBP

Revenue + 8.6% + 1.3% 0%

EBIT + 21.1% + 1.0% - 2.0%

• Exchange rate assumptions for 2017:EUR/CHF: 1.07 USD/CHF: 1.02 GBP/CHF: 1.23

• FX-sensitivity against CHF on Guidance 2017

*) This guidance is based on the absence of unforeseen economic adversity and exchange rates assumed at budget level

Actual

FY 2015

Actual

FY 2016

Guidance 2017*)

Revenue 338.3m 360.2m 410m…425m

EBIT 51.3m 59.0m 60m… 65m

CHF CHF CHF

Upcoming events

• Investor and analyst day October 31, 2017

• 2017 annual results March 15, 2018

• Annual General Meeting April 24, 2018


locate, communicate, accelerate locate, communicate, accelerate

Thank you!

HY1 2012 Results u-blox Holding AG• EBIT margin of 15.2% with growth of 6.1% compared to H1/2016...

Documents

Transcript of HY1 2012 Results u-blox Holding AG• EBIT margin of 15.2% with growth of 6.1% compared to H1/2016...