Q4 Report 2017 · 2019-09-13 · Page 3 GUNNEBO Q4 REPORT 2017 Fourth Quarter 2017 in Brief 2017 2016 2017 2016 Q4 IN BRIEF Q4 Q4 YTD YTD Net sales, MSEK 1,632 1,776 5,991 6,088 EBITDA

Q4 Report 20172 February 2018

Page 2 GUNNEBO Q4 REPORT 2017

▪ The implementation of our Profitable Growth Strategy continues

▪ Continued work with the strategic review in France

▪ Factory closure in South Africa completed

▪ Prioritisation of product areas to furtherstrengthen focus on customers and delivery

▪ Weak sales in the quarter

▪ Bank sales in India and South Africa

▪ Large Entrance Control order delivered in quarter four 2016 in Europe

▪ Strong order intake in Q4

▪ Full year EBIT: 6.2%

CEO’s Comments


Fourth Quarter 2017 in Brief

2017 2016 2017 2016

Q4 IN BRIEF Q4 Q4 YTD YTD

Net sales, MSEK 1,632 1,776 5,991 6,088

EBITDA excl. items affecting comparability (IAC), MSEK 163 203 486 561

EBITDA margin excl. items affecting comparability (IAC), % 10.0 11.4 8.1 9.2

EBITDA, MSEK 133 173 421 489

EBITDA margin, % 8.1 9.7 7.0 8.0

Operating profit (EBIT) excl. items affecting comparability (IAC), MSEK 134 172 369 438

Operating margin (EBIT) excl. items affecting comparability (IAC), % 8.2 9.7 6.2 7.2

Operating profit (EBIT), MSEK 104 142 304 366

Operating margin (EBIT), % 6.4 8.0 5.1 6.0

Net profit for the period, MSEK 76 96 160 209

Basic earnings per share, SEK 0.91 1.25 2.00 2.71

Free cash flow, MSEK 71 107 -74 159

Dividend per share (*proposed), SEK - - 1.20* 1.20


Net Sales, MSEK

Sales by Product Area, YTD


Organic Sales Growth by Quarter


Sales Growth by Quarter and YTD by Region

SALES VS LAST YEAR (QTD)

Organic Structure Currency Total

EMEA -6% 0% 0% -6%

APAC -9% 0% -4% -13%

AMERICAS -3% 0% -6% -9%

TOTAL -6% 0% -2% -8%

SALES VS LAST YEAR (YTD)

Organic Structure Currency Total

EMEA -3% 0% 1% -2%

APAC -4% 0% 1% -3%

AMERICAS 1% 0% 1% 2%

TOTAL -3% 0% 1% -2%


Organic Sales Growth Development by Region Q4 2017 vs Q4 2016

EMEA Asia-Pacific Americas

Sales: -3%Sales: -9% Sales: -6%

Group

Sales: -6%


Gunnebo’s Product Areas and % of Sales Full Year 2017

Cash Management

▪ Deposit & recycling

▪ Closed cash management

▪ Envelope & coin-roll systems

▪ Application & monitoring software

▪ Services

Entrance Security

▪ Entrance control

▪ Security doors & partitions

▪ Electronic article surveillance

▪ Services

Safes & Vaults

▪ Safes

▪ Vaults & vault doors

▪ Safe deposit lockers

▪ ATM safes

▪ Services

Electronic Security

▪ Access control

▪ Intrusion detection

▪ Electronic locking

▪ Remote monitoring

▪ Services

Other

▪ Fire safety products and services

▪ Other traded products and services

33%19% 23% 18% 7%


▪ Continued good sales development in the quarter

▪ Growth area – has continued to strengthen the offering and competence throughout the year

▪ Gunnebo’s cash management solutions will optimise cash processing at one of the first drive-in cinemas in Australia

▪ Renewed multi-year service contract signed with Nordic retail chain, COOP

Product Area Cash Management

Cash Management

▪ Deposit & recycling

▪ Closed cash management

▪ Envelope & coin-roll systems

▪ Application & monitoring software

▪ Services

Sales by RegionFY 2017

EMEA, 67%

APAC, 8%

Americas, 25%

19%of Group Sales


▪ Continued strong sales development in the quarter

▪ Delivery to high-risk site in Australia has started

▪ Breakthrough order to the metro sector in India

▪ Another growing customer segment is airport. During the quarter several orders for pre-boarding gates were received from customers including Munich Airport and Incheon Airport.

▪ In general, good development of sales to public and commercial buildings

Product Area Entrance Security

EntranceSecurity

▪ Entrance control

▪ Security doors & partitions

▪ Electronic article surveillance

▪ Services

* Entrance Control

EMEA, 61%

APAC, 22%

Americas, 17%

23%of Group Sales



▪ Sales developed slowly in the quarter:

▪ Sales of graded safes and vaults decreased in the quarter mainly due to continued slow business with banks in several major markets

▪ Sales of safes to global manufacturers of ATMs down from a high level mainly due to lower volumes in India

▪ The interest for the automated safe deposit locker system, SafeStore Auto, has continued to be good during the quarter and several new orders were received

▪ First order from Pakistan

▪ Solution will be installed at high-end housing estate in Shanghai

Product Area Safes & Vaults

Safes & Vaults

▪ Safes

▪ Vaults & vault doors

▪ Safe deposit lockers

▪ ATM safes

▪ Services

EMEA, 62%

APAC, 23%

Americas, 15%

33%of Group Sales



▪ Sales in the quarter were flat –important improvement compared to the drop earlier in the year

▪ Belgian hospital group, Chirec, equips its latest hospital with security solutions from Gunnebo, including electronic security, cash management and entrance security

Product Area Electronic Security

Electronic Security▪ Access control

▪ Intrusion detection

▪ Electronic locking

▪ Remote monitoring

▪ Services

18%of Group Sales

EMEA, 78%

APAC, 4%

Americas, 18%



▪ OKI project completed

Other - Fire Projects

Other

▪ Fire safety products and services

▪ Other traded products and services

7%of Group Sales


Region Europe, Middle East & Africa (EMEA) Q4 2017

▪ Sales decreased organically by 6%

▪ Positive development of sales in UK, South Europe and France

▪ Strategic review in France continues

▪ Local production in South Africa closed

▪ Cash Management and Electronic Security showed good sales development in the quarter

▪ Entrance Security and Safes & Vaults had a weaker development

▪ Strong order intake

EMEA Sales by Product Area, YTD 2017

2017 2016 2017 2016

Q4 Q4 YTD YTD

Net sales, MSEK 1,058 1,131 3,831 3,907

Organic growth, % -6 2 -3 0

Operating profit excl. IAC, MSEK 54 76 116 172

Operating margin excl. IAC, % 5.1 6.7 3.0 4.4

Items affecting comparability (IAC), MSEK -22 -23 -47 -59

Operating profit, MSEK 32 53 69 113

REGION EMEA

0%

1%

2%

3%

4%

5%

6%

7%

0

200

400

600

800

1,000

1,200

1 2 3 4 1 2 3 4 1 2 3 4

2015 2016 2017

Operating margin %,excl. IAC

Operating margin % 12M,excl. IAC

Sales per quarter


Region Asia-Pacific Q4 2017


▪ Continued weak sales development in India – low spending from the public bank sector and lower sales of safes to global ATM manufacturers in the region

▪ Positive development of sales for other markets in the region

▪ Entrance Security and Electronic Security developed well

▪ Weaker development for fire projects (Other) – OKI project now complete

▪ Safes & Vaults had a weaker sales development

▪ Strong order intake

APAC Sales by Product Area, YTD 2017

0%

2%

4%

6%

8%

10%

12%

14%

16%

18%

0

50

100

150

200

250

300

350

400

1 2 3 4 1 2 3 4 1 2 3 4

2015 2016 2017

Operating margin %,excl. IAC

Operating margin % 12M,excl. IAC

Sales per quarter

2017 2016 2017 2016

Q4 Q4 YTD YTD

Net sales, MSEK 305 351 1,091 1,129

Organic growth, % -9 3 -4 5





REGION ASIA-PACIFIC


Region Americas Q4 2017


▪ Positive development of sales in Brazil, flat in Mexico

▪ Weak development of sales in North America, due to slow business to bank projects

▪ Safes & Vaults developed well particularly in the US where sales to public administration picked up

▪ Entrance Security developed stably

▪ Sales of Electronic Security developed well in Brazil, but continued to be weak on all other markets

▪ Cash Management sales decreased due to delays in investments in bank projects

▪ Order intake was flat

Americas Sales by Product Area, YTD 2017

2017 2016 2017 2016

Q4 Q4 YTD YTD

Net sales, MSEK 269 294 1,069 1,052

Organic growth, % -3 4 1 -2





REGION AMERICAS

0%

2%

4%

6%

8%

10%

12%

14%

16%

18%

20%

0

50

100

150

200

250

300

350

1 2 3 4 1 2 3 4 1 2 3 4

2015 2016 2017

Operating margin %, excl. IAC

Operating margin % 12M, excl. IAC

Sales per quarter

0


Operating Profit by Quarter, MSEK

Operating profit Operating profit, excl. IAC

Full yearOperating profit

excl. IAC

2017: 369 2016: 438 2015: 397

Operating profit

2017: 3042016: 3662015: 320


Operating Profit and EBITDA by Quarter, excl. Items Affecting Comparability

Operating Profit EBITDA


Operating Profit Bridge by Quarter and YTD

OPERATING PROFIT BRIDGE Q4

Operating profit 2016 142

Organic -26

Structure 9

Currency 0

Other -21


OPERATING PROFIT BRIDGE YTD


Organic -39

Structure 54

Currency 17

Other -94



Operating Margin by Quarter, %

Operating margin %, quarter Operating margin % quarter, excl. IAC

Operating margin %, LTM Operating margin % LTM, excl. IAC

Full yearOperating margin,

excl. IAC

2017: 6.22016: 7.22015: 6.6

Operating margin

2017: 5.12016: 6.02015: 5.3


Group Income Statement

CONDENSED CONSOLIDATED INCOME STATEMENTS

2017 2016 2017 2016

MSEK Q4 Q4 YTD YTD

Net sales 1,632 1,776 5,991 6,088

Cost of goods sold -1,185 -1,257 -4,306 -4,319

Gross profit 447 519 1,685 1,769

Selling and administrative expenses -351 -379 -1,395 -1,417

Other operating income and expenses, net 8 2 14 14

Operating profit 104 142 304 366

Financial income and expenses, net -14 -13 -57 -53

Profit before taxes 90 129 247 313

Income tax -14 -33 -87 -104

Net profit for the period 76 96 160 209

Net profit attributable to:

Shareholders of the Parent Company 70 95 153 206

Non-controlling interests 6 1 7 3

Net profit for the period 76 96 160 209

Basic earnings per share, SEK 0.91 1.25 2.00 2.71

Diluted earnings per share, SEK 0.91 1.24 2.00 2.70


Free Cash Flow by Quarter and Last Twelve Months

Free cash flow 12M


Free Cash Flow

FREE CASH FLOW

MSEK2017

Q4

2016

Q4

2017

YTD

2016

YTD

Operating profit 104 142 304 366

Depreciation 16 17 66 68

Amortisation- acquisition-related

intangibles4 6 22 24

Amortisation - other intangibles 9 8 29 31

Other -23 -43 -150 -133

Change in working capital 13 7 -200 -122

Operating cash flow 123 137 71 234

Investing cash flow excluding acquisitions -52 -30 -145 -75

Free cash flow 71 107 -74 159


Net Debt

NET DEBT INCL. & EXCL. PENSION + NET LEVERAGE

Net debt Net leverage

Pension liability Net leverage excl.

pension liability


Group Financial Targets & Outcome

FINANCIAL TARGETS & OUTCOME Target

2017 2016 2017 2016

Q4 Q4 YTD YTD

Organic growth -6% 3% -3% 1% 5%

Operating margin1)

8.2% 9.7% 6.2% 7.2% 7.0%

Return on capital employed1) 2)

10.3% 12.8% 10.3% 12.8% 15.0%

Equity ratio 33% 34% 33% 34% 30%

1) Excluding items affecting comparability (IAC)

2) During the last twelve-month period

5%Organic growth

7%Operating margin

15%Return on capital

employed

30%Equity ratio


Final Remarks

▪ 2017 was an unsatisfactory year in terms of

growth and profitability

▪ Structural measures continue to drive

productivity

▪ Strong agenda in place to support growth


Financial Calendar 2018

www.gunnebogroup.com

Documents

Q4 Report 2017 · 2019-09-13 · Page 3 GUNNEBO Q4 REPORT 2017 Fourth Quarter 2017 in Brief 2017 2016 2017 2016 Q4 IN BRIEF Q4 Q4 YTD YTD Net sales, MSEK 1,632 1,776 5,991 6,088 EBITDA