SMT Scharf AG Dieselgetriebene Lok · • High market share in all target markets –round about...
Transcript of SMT Scharf AG Dieselgetriebene Lok · • High market share in all target markets –round about...
November 2017 | 1
SMT Scharf AG
Investor Presentation
German Equity Forum 2017
Frankfurt, November 27-29, 2017
Hans Joachim Theiß, CEO
Dieselgetriebene Lok
Dieselgetriebene Zahnradlok
Batteriegetriebene Lok
November 2017 | 2
Executive Summary
Management Board
Products and Services
Business System and Organisation
Market and Competition Analysis
Strategy
Current figures (group)
Content
November 2017 | 3
SMT Scharf at a glace
• Global market and technology leader in rail systems and chair lifts for underground mining
• Potential to unlock further application possibilities and markets in the future
• Highly specialized engineering company with more than 50 years of experience and global presence
• New products, innovations and business segments hold opportunities for growth
• High market share in all target markets – round about one third of all monorails installed worldwide are produced
by SMT Scharf
• Well positioned in major mining nations like China, Russia or South Africa
• Solid business in cyclical market environment due to large contribution of service related business to total revenue
• Sustainable financing structure based on low debt and equity capital ratio > 60 %
• Low break even point mirrors successful measures of operative excellence
• Robust medium-term growth potential (due to strategic measures and upcoming mining boom)
• Global trends towards automation and higher security standards in mining support growth
Global market leader in it’s niche with a stable business
model and growth opportunities
Executive Summary | Management Board | Products & Services | Business System & Organisation | Market & Competition Analysis | Strategy | Current Figures
November 2017 | 4
Hans Joachim Theiss (CEO)
• Responsible for finance, controlling, strategic corporate development, M&A, Investor Relations
• >10 years CEO in comparable medium-sized companies and >10 years experience in consulting
• Resigned as Deputy Chairman of SMT Scharf’s Supervisory Board
Rolf F. Oberhaus (CSO)
• Responsible for sales, service and market development, board member since January 2016
• Longstanding experience in executive positions in mining, railroad and steel industries
• Comprehensive network in markets essential for SMT Scharf
Wolfgang Embert (COO)
• Responsible for product development, production areas and construction
• Shaping product development in 7 years as technical director at SMT Scharf
• Extensive product, production, sector and market expertise through >20 years of sector experience
Management Board
Longstanding experience combined with
expertise in consulting
Executive Summary | Management Board | Products & Services | Business System & Organisation | Market & Competition Analysis | Strategy | Current Figures
Services
• Main product monorail
• Unsurpassed reliability
• Innovational strength and
continuous product development
• Expandability of
transportation solutions
• Highest safety standards
fullfilled (explosion control)
Overview of the product range
Specialized in solutions for mining transport
Railway systems
Monorail hanging railways,
floor-bound railways
Chairlifts
Other/New
Executive Summary | Management Board | Products & Services | Business System & Organisation | Market & Competition Analysis | Strategy | Current Figures
November 2017 | 6
Our offering: combining products to a
transport system
Executive Summary | Management Board | Products & Services | Business System & Organisation | Market & Competition Analysis | Strategy | Current Figures
November 2017 | 7
• After sales revenues constitute a major part of
SMT’s business model
• ~50 % of SMT‘s revenues (core business) are
attributable to after sales services
Spare parts
Maintenance & repair services
Product overhaul (after 5-8 years of operation)
• Successful introduction of maintenance
contracts into the South African market
• Generation of recurring income streams from
customers throughout the life cycle of the
products
• High customer satisfaction Replacement with
new SMT products, starting a new cycle
Stable After Sales business thanks to
long product life cycle
Typical product life cycle
New
product
Overhaul
Maintenance/
repairs
Maintenance/
repairs
Executive Summary | Management Board | Products & Services | Business System & Organisation | Market & Competition Analysis | Strategy | Current Figures
November 2017 | 8
Strong After Sales business as source of revenue
Exemplary product lifetime revenues (with preventive maintenance)
Maintenance/ repairs
Overhaul
Maintenance/ repairs
New product
Total lifetime revenues
Executive Summary | Management Board | Products & Services | Business System & Organisation | Market & Competition Analysis | Strategy | Current Figures
November 2017 | 9
Group structure
Broad international standing and close to customers
* Other 50 %: Shandong Liye Equipment Co. Ltd.
100 %
Scharf Mining Machinery (Beijing) Co., Ltd.
50 % *
Shandong XinSha Monorail Co. Ltd.
1,25 %
OOO SMT Scharf Russia
100 %
OOO SMT Scharf Service
SMT Scharf AG
100 %
SMT Scharf Saar GmbH (i. L.)
100 %
SMT Scharf Polska Sp.z.o.o
100 %
Scharf Mining Machinery (Xuzhou) Co., Ltd.
100 %
SMT Scharf Africa (Pty) Ltd.
100 %
TOW SMT Scharf Ukraina
98,75 %
OOO SMT Scharf Russia
100 %
SMT Scharf GmbH
100 %
Nowilan GmbH
100 %
SMT Scharf Sudamerica SpA (i. G.)
Executive Summary | Management Board | Products & Services | Business System & Organisation | Market & Competition Analysis | Strategy | Current Figures
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Worldwide sales in all relevant mining markets
SMT Scharf subsidiaries Joint venturesSMT Scharf HQ Active sales territories
Executive Summary | Management Board | Products & Services | Business System & Organisation | Market & Competition Analysis | Strategy | Current Figures
November 2017 | 11
• Thousands of
underground mines
• Annual equipment
needs estimated to be
1 bn EUR
• Deposits all over the
world
• Globally correlated
commodity prices
• High raw material
prices, high mining
investments
• Low raw material
prices, low mining
investments
• Increase in efficiency
(„larger, stronger,
deeper“)
• Local „me too“
competition
Global underground market for rail-bound transport systems
SMT Scharf meets all market demands
Strong market share
and growth potential
International
development team
satisfy customer
needs
Financially sound
company with low
break-even point
Global presence of
international
subsidiaries
SIZE INTERNATIONALITY CYCLICALITY INNOVATION PRESSURE
Executive Summary | Management Board | Products & Services | Business System & Organisation | Market & Competition Analysis | Strategy | Current Figures
November 2017 | 12
Recovery of raw material prices in 2017
Source: http://www.sxcoal.com/site/index/en
• Cyclical low point probably passed due to increasing price levels in 2017
• Consolidation of coal mining supply side in Chinese market
• New steel plants in China: demand for high-quality coking coal grows
• Sustainable upward trend remains to be seen
• Strong price-“comeback” possibly depends on technical reasons
Executive Summary | Management Board | Products & Services | Business System & Organisation | Market & Competition Analysis | Strategy | Current Figures
+
t (years)
% Change
Length of the raw material cycle ~5-15 years
0
+
-
Raw material
prices
~0.5-2 5 10 15
Investment level
mining equipment
Mining cycle (schematic representation)
Mining investments cyclically follow raw material prices
Typical delay of
0.5 – 2 years
Source: SMT Scharf
Executive Summary | Management Board | Products & Services | Business System & Organisation | Market & Competition Analysis | Strategy | Current Figures
Vision: Expanded product range in mining logistics
• Stable core business with solid margins and growth opportunities
• Evolved expertise in machine engineering with maximal customer focus
• Management expertise in mining
External growth Organic growth Operational excellence
• Localization of value chain
largely finished
• Increase in organizational and
operational efficiency according
to local market development
Core competencies
• “Buy & build” within the
niche market
• Possibility to expand core
positioning
• Starting a controlled offensive
• Expansion into new regions
• Hard Rock business
• Expansion of product range
Further development of the business model
Three-pillar strategy on a stable foundation
Executive Summary | Management Board | Products & Services | Business System & Organisation | Market & Competition Analysis | Strategy | Current Figures
Increase international presence
Expand product range
Standardization
Acquisitions
• Expansion of local sales and service offices
• Tap new geographic markets
• Improvement of propulsion technology, control systems and diagnostic tools
• Further develop existing designs
• Development of new powerful and cost-effective applications
• Achieve shorter lead times
• Utilize local production
• Expand existing product and technology range
• Promote international alignment of SMT Scharf
• Increase market penetration
Strategic measures
Continuously utilizing strategic opportunities
Strategic partnerships• Extend product range
• Enter new markets
Executive Summary | Management Board | Products & Services | Business System & Organisation | Market & Competition Analysis | Strategy | Current Figures
November 2017 | 16
Strategic measures successfully realized
next steps planned
Source: www.nowilan.de
Source: www.khmtunnel.com
Executive Summary | Management Board | Products & Services | Business System & Organisation | Market & Competition Analysis | Strategy | Current Figures
Acquisition of drive technology
specialist Nowilan
Expansion of our product and
technology range with Nowilan,
who develops customer-specific
solutions on a project basis
Strategic partnership with
Mühlhäuser
Exclusive sales of the jointly developed
new tunnel solution by Mühlhäuser
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Strategic measures successfully realized in 2017
next steps planned
Executive Summary | Management Board | Products & Services | Business System & Organisation | Market & Competition Analysis | Strategy | Current Figures
Foundation of a sales subsidiary in
Chile
Own distribution hub improves
leverage of potentials in South
American hard-rock mining
Strategic partnership with
Breuer-Motoren
SMT Scharf takes over the exclusive
distribution and after-sales business
for Breuer-Motoren in the core market
Russia
November 2017 | 18
Significant revenue increase in all divisions in 2017
Revenue share by region
Revenue share by operating segmentRevenue share by business type
Revenue share by product
Executive Summary | Management Board | Products & Services | Business System & Organisation | Market & Competition Analysis | Strategy | Current Figures
November 2017 | 19
EBIT more than doubled in 9M 2017 due to economies of
scale, efficiency gains and lower provisions
Comparison of EBIT and operating performance
Executive Summary | Management Board | Products & Services | Business System & Organisation | Market & Competition Analysis | Strategy | Current Figures
November 2017 | 20
Tailwinds from good order book position
Development of the order book position
Executive Summary | Management Board | Products & Services | Business System & Organisation | Market & Competition Analysis | Strategy | Current Figures
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Receivables management continues to bear fruit
Balance sheet
Assets
Executive Summary | Management Board | Products & Services | Business System & Organisation | Market & Competition Analysis | Strategy | Current Figures
November 2017 | 22
Still strong equity capital
Balance sheet
Liabilities and Equity
Executive Summary | Management Board | Products & Services | Business System & Organisation | Market & Competition Analysis | Strategy | Current Figures
November 2017 | 23
Revenues and earnings in 9M 2017 above plan
Key performance indicators in target/actual comparison
Revenues: EUR 35.2 million (outlook: at least EUR 30.0 to 33.0 million)
EBIT margin: 10.6% (outlook: at least 5.0%)
Group net profit: EUR 3.7 million (outlook: increase compared to previous year)
Equity ratio: 68.5% (outlook: previous year's level of 66.1%)
Personnel expenses ratio: down to 24.7% (outlook: rising)
Raising the 2017 forecast: Revenues of at least EUR 44 to 48 million revenue
and EBIT of EUR 3.7 to 4.2 million
Positive expectations for 2018
Executive Summary | Management Board | Products & Services | Business System & Organisation | Market & Competition Analysis | Strategy | Current Figures
November 2017 | 24
Source: Frankfurt Stock Exchange
Stable share price performance since June 2016
EUR
0
2
4
6
8
10
12
14
16
18
2016-06-01 2016-09-01 2016-12-01 2017-03-01 2017-06-01 2017-09-01
SMT Scharf Peer Group SDAX
Executive Summary | Management Board | Products & Services | Business System & Organisation | Market & Competition Analysis | Strategy | Current Figures
November 2017 | 25
SMT Scharf at a glace
• Global market and technology leader in rail systems and chair lifts for underground mining
• Potential to unlock further application possibilities and markets in the future
• Highly specialized engineering company with more than 50 years of experience and global presence
• High market share in all target markets – round about one third of all monorails installed worldwide are produced by
SMT Scharf
• Well positioned in major mining nations like China, Russia or South Africa
• Solid business in cyclical market environment due to large contribution of service related business to total revenue
• Sustainable financing structure based on low debt and equity capital ratio > 60 %
• Robust medium-term growth potential (due to strategic measures and upcoming mining boom)
• Global trends towards automation and higher security standards in mining support growth
Global market leader in it’s niche with a stable business
model and growth opportunities
Executive Summary | Management Board | Products & Services | Business System & Organisation | Market & Competition Analysis | Strategy | Current Figures
November 2017 | 28
Above ground
Underground
Special machine
construction
Bunker Conveyor belt
Explosives
Mining:
Cutting drum,
Plough,
Continuous
Miner
Hand
tools
Bunker Conveyor belt
Monorail
Rubber tyre
vehicles
Rubber tyre
vehicles
Shaft hoisting system
Anchor Anchor
Energy
Electricity
Compressed air
Hydraulics
Automation /
Networking
Expansion
technology
Anchor
Where we are and what we do
Executive Summary | Management Board | Products & Services | Business System & Organisation | Market & Competition Analysis | Strategy | Current Figures
November 2017 | 29
8%
12%
80%
57%24%
19%
USA: 671,8China: 3.242,5
Australia: 503,3
India: 707,6
Russia: 365,5
Poland: 130,9Kazkhstan: 97,9
Rest of the world: 1,420
South Africa: 256,9
Underground (Longwall)
Underground (Room & Pillar)
Above ground
Global coal production, in mt
Source: International Energy Agency, Coal information overview 2017, company estimate
Great potential in underground coal production
Executive Summary | Management Board | Products & Services | Business System & Organisation | Market & Competition Analysis | Strategy | Current Figures
November 2017 | 30
USA: 826
China: 400
Australia: 387
Indonesia: 210
Russia: 215
Ukraine: 100
South Africa: 236
Canada: 189
Mexico: 137
Peru: 201
Chile: 498
Brazil 196
Global ore production (e.g. gold, platinum, copper, nickel), in mt
Source: Raw Materials Group, Stockholm
Hard Rock brings new regions into focus
Executive Summary | Management Board | Products & Services | Business System & Organisation | Market & Competition Analysis | Strategy | Current Figures
November 2017 | 31
Consolidated Statement of Comprehensive Income
in EUR thousand Q3/2017 Q3/2016 9M/2017 9M/2016
Revenue 12,035 7,593 35,192 26,680
Changes in inventories 464 628 2,076 792
Total operating performance 12,499 8,221 37,268 27,472
Other operating income 1,306 686 3,114 2,291
Cost of materials 6,431 4,208 19,855 13,073
Personnel expenses 2,297 2,681 8,693 8,384
Depreciation, amortization and impairment losses 293 297 908 1,075
Other operating income 2,012 1,699 6,994 5,680
Profit from operating activities (EBIT) 2,772 22 3,932 1,551
Income from participating interests 219 -13 205 461
Interest income 60 37 155 87
Interest expenses 35 45 84 119
Financial result 244 -21 276 429
Profit before tax 3,016 1 4,208 1,980
Executive Summary | Management Board | Products & Services | Business System & Organisation | Market & Competition Analysis | Strategy | Current Figures
November 2017 | 32
Consolidated Statement of Comprehensive Income
in EUR thousand Q3/2017 Q3/2016 9M/2017 9M/2016
Income taxes 137 403 510 776
Group net profit 2,879 -402 3,698 1,204
Other comprehensive income items
recycled later to profit or loss
Currency difference from translation
of foreign financial statements-358 -116 -945 118
Share of other comprehensive income attributable
to equity accounted investments-26 279 -270 -202
Other comprehensive income -384 163 -1.215 -84
Total comprehensive income -2,495 -239 2,483 1,120
Earnings per share (in EUR)
Basic 0.69 -0.10 0.89 0.29
Diluted 0.69 -0.10 0.89 0.29
Average number of shares 4,150,523 4,143,675 4,150,523 4,141,581
Executive Summary | Management Board | Products & Services | Business System & Organisation | Market & Competition Analysis | Strategy | Current Figures
November 2017 | 33
Consolidated Balance Sheet
in EUR thousand 30/09/2017 31/12/2016
Assets
Intangible assets 1,938 1.,73
Property, plant and equipment 4,836 4,656
Participating interests 3,690 3,743
Deferred tax assets 3,236 3,259
Other non-current receivables / assets 828 733
Non-current assets 14,528 13,764
Inventories 17,175 13,009
Trade receivables 20,194 23,374
Other current receivables / assets 3,528 2,627
Cash and cash equivalents 5,543 6,638
Current assets 46,440 45,648
Total assets 60,968 59,412
Executive Summary | Management Board | Products & Services | Business System & Organisation | Market & Competition Analysis | Strategy | Current Figures
November 2017 | 34
Consolidated Balance Sheet
in EUR thousand 30/09/017 31/12/2016
Equity and liabilities
Subscribed share capital 4,151 4,151
Share premium 11,642 11,642
Profit brought forward 30,449 26,751
Currency translation difference -4,462 -3,247
Equity 41,780 39,297
Provisions for pensions 3,602 3,590
Other non-current provisions 309 349
Deferred tax liabilities -22 96
Non-current financial liabilities 1,103 1,313
Other non-current liabilities 0 0
Non-current provisions and liabilities 4,992 5,348
Executive Summary | Management Board | Products & Services | Business System & Organisation | Market & Competition Analysis | Strategy | Current Figures
November 2017 | 35
Consolidated Balance Sheet
in EUR thousand 30/09/2017 31/12/2016
Current income tax 1,336 1,441
Other current provisions 3,903 5,107
Advance payments received 582 477
Trade payables 4,288 4,058
Current financial liabilities 3,104 2,183
Other current liabilities 983 1,501
Current provisions and liabilities 14,196 14,767
Total equity and liabilities 60,968 59,412
Executive Summary | Management Board | Products & Services | Business System & Organisation | Market & Competition Analysis | Strategy | Current Figures