Norma Group Ag Name Akt

Ladies and gentlemen, welcome to our analyst conference called Quarter 2, 2021. The overall economy situation, if you look in the daily press, is still in a certain crisis mode. We can read of corona, logistics capacities, shortages of materials, semiconductors, steel, etc., In view of all that, in view of that overall economic situation, we had a very good Q2 2021 as Norma grew. Sales were up by 47%, so that we reached a sales level of 281.7 million. And this also means that we are only slightly below the pre-crisis level of quarter two 2019. We generated an adjusted EBIT A out of these nearly 82 million of 13.6%, which is 38 million. And in terms of EBIT, we generate an EBIT margin of 12.8%, meaning 36 million of EBIT. We had also a strong cash situation. We generated a strong net operating cash flow, 36.8 million. And we also improved our balance sheet for the with an equity ratio of 42.7 percent, net debt going to $352 million, and leverage of 2.0 instead of 3.4 end of 2020. We had our annual general meeting in May this year, and all agenda items were approved by the annual general meeting, including a dividend of 70 cents per share. We confirm on our guidance for the fiscal year 2021. And if you look on the different topics of normal group, top line development Q2 2021, which is on page three of our presentation, we see on that page three that we generated sales of 568 million in H1 2021. This is a change of 27.6% and organically of 33%. But we all know we have very low comps in 2020 because of the corona situation. So maybe the comps are not so meaningful as it was in the last years. But a good sales development on pre-crisis level. The organic growth. in terms of EJT and standard products increases were overall very good. We had EJT sales with very good recovery of 88.7% in Q2 2021 and overall for the first half year of 43%. For the standard joining technology products, we also showed a very good recovery, 23.3% in Q2 and overall slightly above 20% in H1 2021. We had some currency effects, negative translation effects of around 11.3 million or 5.9%. If you look on the absolute figures in terms of growth, we organically grew 147 million in the first half year, and you see also the regional split on that chart. We had 45% of our sales in EMEA, 40% in Americas, and 15% in APEC. The regional split we see on the next page, on page four, where we show the segment reporting in Q2 and H1 on a regional level. And we can see that EMEA generated sales in Q2 of 123 million, which is an organic growth. You see that on the right-hand side of 79%, which is driven by EJT and also our standardized joining technology products with a very strong growth But as mentioned, this growth is mathematically impacted by the low coms, COVID-19 related coms in 2020. So we have quite high increases versus Q2 2020 because Q2 2020 was the, let's say, high season of corona in 2020. So very high increases versus that crisis quarter in 2020. 79.4% in EMEA. Americas also grew nicely based on EJT and standard joining technology. EJT sales were more than doubled organically in the second quarter. And the standard joining technology had a strong double-digit organic growth of 21.2%. Interesting here is also the water management business. Water management grew 12.9% in the second quarter and overall slightly above 20% in the first half here, 21. APEC growth, quarter two, 16%. First half here, around 30%. Here we see that the corona situation in APEC normalized earlier than in the other regions, which means that Q2 2020 was on a more normal level and not so in a critical phase like in other regions. And so far, the growth in APEC around 30% for the first half year, growth of 17.9% in Q2 for each AT business, 40.5% for the full half year, and standardized joining technology with a double-digit growth, 12.4% in Q2, so that we are overall on a quite good level in relation to last year and even in relation to 2019. Looking on the margin situation on page five, Q2 2021 EBIT and EBIT A margin development. We had an EBIT A of 13.6% in Q2 this year and EBIT of 12.8%. So the positive impacts came from the economic recovery and a strict cost control management that we had, which results in a strong Q2 2021 margin, which is almost on the level as Q1 2021 and only 60 pips lower than the second quarter of 2019. And in so far, this also leads to our confirmation of the guidance for fiscal year 2021, despite we have some headwinds in our volatile economic situation. With that, I hand over to Anette, our CFO.

Thank you, Michael. Yes, so let's have a look, a bit closer look to the ratios, in particular of the P&L. If we concentrate here firstly on our gross profit, we can see that the gross profit ratio increased by 100 BPs in H1 due to a strict cost discipline and the successful implementation of our get-on-track measures. Material cost ratio increased technically a little bit. This is mostly due to the fact that we are running the P&L by nature, which is a bit special. So, therefore, for me, at the end, gross profit margin is the real measure where we can follow up that our measures are, at the end, very active and successful. Personal expenses, there we can see that we significantly improved in H1 to 25.8% in Q2 to 25.7%. The reason for that is majorly that last year in Q2, we booked the restructuring reserve, a major part of our Get on Track program of the downsizing and closure of two plants. And there we booked last year with a provision of roughly 20 million euro. So that is the major reason for the significant improvement here. In terms of OPEX, OPEX costs or OPEX ratio improved in Q2. Here, we always want to point out in Q2, we booked last year again get-on-track costs also related to these different efficiency programs of 1.6 million euros. Therefore, we already have here a significant improvement. OPEX in the first half of the year, is stable. That is majorly due to the higher number of temp employees or workers which we have here, and that is mostly due to the reason that our business is starting again and that we take first of all in order to get back to normal and to restart temporary people on board, in particular in APEC. That is the major reason here. Let's have a look to our adjusted EBITDA margin. There you can see that in Q2, we achieved there 13.6%, and in Q, in H1, 13.7%, which is under the headwinds in the market, I think, a very remarkable result. So we stay with our guidance. I think Michael already pointed that out. We feel comfortable by that and are very positive that we might reach that and will reach that. Having looked to our earnings per shares, our operational adjustments, the major message is, as I think already beginning of last year, that on EBITDA level, we have no adjustments anymore. Our Get on Track program, we don't adjust in terms of costs. Therefore, our adjustments are mostly driven by prior M&A activities, so classical things like depreciation, amortization, and the effective tax out of that. Having said that, we have a reported EPS of 1.29 euro, adjustments of 0.35, and an adjusted EPS of 1.54. EPS development then in Q2 and H1, we could achieve in Q2 an adjusted EPS of 78 cents. In H1, an adjusted EPS of €1.54 and the respective net income of €24.9 million in Q2 and of €49.1 million in H1. Looking to the reported EPS, we have an EPS in Q2 of 66 cents and in H1 of €1.29. And this corresponds with the net incomes of €20.9 million in Q2 and €41.1 million in H1. Our net debt and equity ratio show a very strong and solid development and improvement. So majorly, we get now rid of the, I always call it the bait, the very bad Q3 of 2020 where corona had his peak. So therefore, looking to the mix, we could deduct our net debt a bit Our cash increased a little bit, but the reason for that is for sure and only the financing of this remarkable growth, and we still have a very, very solid cash position of €169 million. In terms of supply chain financing, we kept that nearly stable. So we had, by the end of last year, 52.3 million euros there. We increased that by 1.2 million euros for June 30th in 2021. Looking to the equity ratio, we could improve that to a remarkable 42.7%. And we strongly improved our leverage to 2.0. So there you can see that in the last, considering the last 12-month EBTA, we really got now back to, I would say, a very, very comfortable and good leverage ratio there. Considering our cash flow development, for sure our higher EBTA is due to economic recovery and a strict cost control. In terms of trade work and capital outflow, this minimized for sure because we have to finance higher accounts receivable. This is not due to overdue. That is really the growing business of the recent two months. So I think that is all like it should be when a business grows. We increased our investment activities back to old ratios, roughly 5%. So this is reflecting also the higher business activities and the needs in order to support that. Coming to the Norma value added, which is Norma's group long-term strategic target. So we count there or determine there the annual value creation of Norma In Q2, we could achieve there an 8.6 million euro, and for H1, we could achieve 17.9 million euro. Yeah, having said that, and with a closer look through the balance sheet ratios, Michael, I give over to you again for get-on-track.

Yeah, thanks, Annette. We put in a slide here to also show our get on track activities the most important message here is that we are on track with our get on track program so we are well underway with major savings in 2021 we achieved savings so far accumulated of 10.8 million we have until end of first half here 2021 minor costs for implement implementing these measures of 1.4 million so that we also I expect that we will reach our target for the get on track program in 2021 and also the next couple of years. So get on track program well underway. If I summarize the situation and the figures so far, Q2 and with the Q2 also H1 for normal group strong. We had good top line development. a good margin development, a good level of cash flow, and a further reduced leverage. And so far, H1 is a good basis for reaching our targets for the full year 2021. We still have a very volatile situation. As you all know, I mentioned it in the beginning. So in the whole industry, there is a couple of headwinds. Nevertheless, we stick to our company guidance for 2021, which means we will have organic sales growth for 2021, full year, double-digit, low double-digit. We will see an adjusted EBITDA margin of more than 13%, and respectively an adjusted EBIT margin of more than 12%. Data operating cash flow, 110 million plus. and a value creation which we measure as normal value added between 10 and 25 million. With that, I would like to hand over to you. And of course, we are very happy to go in Q&As together with you. Thanks a lot.