THE WAY TO MAKE IT Half-year results and outlook 2014 19 August - PDF document

THE WAY TO MAKE IT Half-year results and outlook 2014 19 August 2014 19 August 2014 / Half-year results and outlook 2014 / 1 Agenda THE WAY TO MAKE IT Half-year results 2014 Outlook Komax – focussed on markets in the automation sector Komax Wire Komax Medtech 19 August 2014 / Half-year results and outlook 2014 / 2

First half 2014 in brief THE WAY TO MAKE IT Strong first half of 2014 Revenues 1 increased by 8.6% to CHF 171.6 million Operating profit (EBIT) from continuing operations at CHF 22.5 million maintained Group profit after taxes from continuing operations increased by 6.7% to CHF 21.0 million Komax Wire Net sales increased by 9.6% to CHF 139.9 million Internal growth of more than 6% Strengthening trend towards further automation in the field of wire processing EBIT margin in target area Komax Medtech Net sales on last year’s level EBIT maintained despite low capacity utilization at La Chaux-de-Fonds site Komax Solar Management buyout New company will start operations in second half 2014 1 Revenues from continuing operations. Prior-year figures restated owing to application of IFRS 5. 19 August 2014 / Half-year results and outlook 2014 / 3 Key figures THE WAY TO MAKE IT +/- H1 2013 1 H1 2014 1 in TCHF internal acqui- currencies Total growth sitions Order intake 184'536 176'186 -4.5% Revenues 2 157'917 171'573 5.9% 4.7% -2.0% 8.6% Book-to-Bill 1.17 1.03 EBIT 22'696 22'539 -0.7% in % of revenues 14.4% 13.1% -0.6pp Result from discontinued operations -3'957 -12'728 221.7% EAT 15'708 8'254 -47.5% in % of revenues 9.9% 4.8% Free cash flow 12'041 10'023 -16.8% Net cash first half 2014/31.12.2013 22'616 20'768 -8.2% 1 Prior-year figures restated owing to application of IFRS 5. 2 Revenues: Net sales + other operating income. 19 August 2014 / Half-year results and outlook 2014 / 4

Distribution of net sales by segment and region THE WAY TO MAKE IT H1 2013 H1 2014 by segment Komax Wire 80% 80% Komax Medtech 20% 20% by region Switzerland 2% 3% Europe 44% 52% Africa 6% 8% North/South America 27% 18% Asia 21% 19% 19 August 2014 / Half-year results and outlook 2014 / 5 Net sales 1 – growth in both business units THE WAY TO MAKE IT in CHF million 1.5 0.0 12.3 171.5 157.7 2 H1 2013 Wire Medtech Corporate H1 2014 1 Net sales from continuing operations. 2 Prior-year figures restated owing to application of IFRS 5. 19 August 2014 / Half-year results and outlook 2014 / 6

EBIT 1 – gross profit margin slightly increased THE WAY TO MAKE IT in CHF million -6.2 9.1 -0.2 -2.9 Gross profit margin H1 2014: 62.0% Gross profit 22.7 22.5 margin H1 2013: 61.5% 2 H1 2013 Material/revenues Personnel Depreciation Others H1 2014 1 EBIT of continued operations. 2 Prior-year figures restated owing to application of IFRS 5. 19 August 2014 / Half-year results and outlook 2014 / 7 EBIT 1 by segment – Wire and Medtech match previous year’s level THE WAY TO MAKE IT in CHF million 0.6 -0.3 -0.5 26.7 22.7 22.5 9.0 2 H1 2013 Wire Medtech Corporate H1 2014 1 EBIT of continued operations. 2 Prior-year figures restated owing to application of IFRS 5. 19 August 2014 / Half-year results and outlook 2014 / 8

Komax Wire – still strong THE WAY TO MAKE IT Margin Net sales by region 18 0 20.5% 2% 19.1% Switzerland 16 0 21% Asia 14 0 139.9 in CHF million 46% 12 0 127.7 Net sales Europe EBIT 10 0 80 21% 60 North/ South America 40 10% Africa 20 26.1 26.7 0 H1 2013 H1 2014 Change from previous year -40% -20% 0% 20% 40% Switzerland Order intake and net sales increased by around 10% Europe Contribution of SLE around CHF 7.6 million Africa EBIT on a high level North/ Net sales growth in Europa, Africa und Asia South America Asia 19 August 2014 / Half-year results and outlook 2014 / 9 Komax Medtech – on last year’s level THE WAY TO MAKE IT Margin Net sales by region 50 5% 1.7% 5% 0.8% 13% 45 Switzerland Asia North/ 40 South America in CHF million 35 77% Net sales Europe 30 31.9 EBIT 30.4 25 20 15 10 5 0.5 0.3 0 H1 2013 H1 2014 Change from previous year 0% 40% 80% 120% 160% 200% 240% 280% Switzerland Net sales and EBIT at the same level as last year Unsatisfactory order intake in La Chaux-de-Fonds in Europe second quarter North/ Rockford and Penang robust South America Asia 19 August 2014 / Half-year results and outlook 2014 / 10

Komax Solar – Management Buy-out (Asset Deal) THE WAY TO MAKE IT Result from discontinued operations Assets and liabilities classified as held for sale (CHF million) (CHF million) The “result from discontinued operations” includes non- cash expenditures for value adjustments for technology, goodwill and current assets in the order of CHF 8 million. 19 August 2014 / Half-year results and outlook 2014 / 11 Agenda THE WAY TO MAKE IT Half-year results 2014 Outlook Komax – focussed on markets in the automation sector Komax Wire Komax Medtech 19 August 2014 / Half-year results and outlook 2014 / 12

Outlook THE WAY TO MAKE IT For Komax Wire we are not expecting any substantial changes to the market environment in the second half, and are thus anticipating continued strong performance. On the basis of the information currently available, we are expecting net sales in the second half of 2014 to be broadly on a par with the first half. However, the economic climate for Komax Medtech has taken a turn for the worse. The business unit’s success in 2014 now depends substantially on more orders being booked in La Chaux-de-Fonds. The Group’s solar activities will be taken over by the present management team in the second half of the year. Until the definitive handover of the solar business, we are expecting a further negative contribution to the results in the second half. 19 August 2014 / Half-year results and outlook 2014 / 13 Agenda THE WAY TO MAKE IT Half-year results 2014 Outlook Komax – focussed on markets in the automation sector Komax Wire Komax Medtech 19 August 2014 / Half-year results and outlook 2014 / 14

Group strategy geared to long-term profitable growth THE WAY TO MAKE IT Business Unit Revenues growth target EBIT margin target Acquisitions Business Unit Wire 3 – 5% ~20% selective Business Unit Medtech -- ~5% -- Targets implemented in March 2011, time horizon 3 to 5 years. Komax Medtech is in systems business, i.e. it mainly manufactures complex, customer specific systems. In this business, targeted selection of the projects to be acquired is more important than growth per se. 19 August 2014 / Half-year results and outlook 2014 / 15 Agenda THE WAY TO MAKE IT Half-year results 2014 Outlook Komax – focussed on markets in the automation sector Komax Wire Komax Medtech 19 August 2014 / Half-year results and outlook 2014 / 16

Komax Wire – a highly attractive and profitable business THE WAY TO MAKE IT Solutions for wire processing and harness and Key figures 2009 – H1 2014 module testing Marge 26.2% 23.1% 30 0 24.6% 18.7% 19.1% 20 .0% 25 0 253.8 -3.2% 0.0 % 228.3 217.8 20 0 194.5 -2 0.0 % 15 0 139.9 -4 0.0 % 10 0 91.9 -6 0.0 % 50 57.1 52.7 47.4 47.8 26.7 -3.0 -8 0.0 % 0 2009 2010 2011 2012 2013 H1 2014 in CHF million -5 0 -1 00. 0% Net sales EBIT 19 August 2014 / Half-year results and outlook 2014 / 17 Strategy Komax Wire – capture potential THE WAY TO MAKE IT Growth along the value chain Innovation Global presence Complete solutions/new fields of application 19 August 2014 / Half-year results and outlook 2014 / 18

Komax Wire covers the most capital intensive stages of the value chain THE WAY TO MAKE IT Net sales by industry Value chain wire harness manufactures (automotive industry) 20-30% Others 70-80% Automotive 19 August 2014 / Half-year results and outlook 2014 / 19 Automotive is the most important market for wire processing THE WAY TO MAKE IT Growth drivers for Komax Wire’s business Market segmentation by industry Electronic based innovation cyle of Others the automotive industry Electric devices Automotive • Vehicles networks and networking vehicles Commodities as well as trend towards intelligent cars • Driver assistance and safety systems High-speed- • Alternative driving systems data communi- cation More and more equipment in cars Increasing level of automation in production • Increasing quality requirements Around 60% of overall processed wires are • Miniaturization applied in the automotive industry • Increasing labor cost Characteristics of the automotive industry Increasing complexity of wire harnesses – • High level of standardization growing importance of testing • High number of units Demographic factors • High quality requirements • Population growth • Dynamic and innovative • Growing middle class • Increase in individual mobility 19 August 2014 / Half-year results and outlook 2014 / 20