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Successful FY17 laying Foundation for sustainable Growth/media/Files/O/Osram/... · Global No. 1...
Transcript of Successful FY17 laying Foundation for sustainable Growth/media/Files/O/Osram/... · Global No. 1...
Successful FY17 laying Foundation for sustainable Growth
Q4 FY17 Earnings Release (preliminary, unaudited figures)
OSRAM Licht AG | November 06, 2017 Light is OSRAM
www.osram.com
OSRAM Licht AGQ4 FY17 Earnings Release (preliminary, unaudited figures) | November 06, 2017
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Disclaimer
This presentation may contain forward-looking statements that are subject to risks and uncertainties, including those pertainingto the anticipated benefits to be realized from the proposals described herein. Forward-looking statements may include, in particular,statements about future events, future financial performance, plans, strategies, expectations, prospects, competitive environment,regulation and supply and demand. OSRAM Licht AG has based these forward-looking statements on its current views and expectationsand on certain assumptions of which many are beyond OSRAM Licht AG’s control. Actual financial performance could differ materiallyfrom that projected in the forward-looking statements due to the inherent uncertainty of estimates, forecasts and projections, and financialperformance may be better or worse than anticipated. Given these uncertainties, readers should not put undue reliance on any forward-looking statements. The information contained in this presentation is subject to change without notice and OSRAM Licht AG does notundertake any duty to update the forward-looking statements, and the estimates and assumptions associated with them, exceptto the extent required by applicable laws and regulations.
This presentation includes references to non-IFRS financial measures, including, but not limited to: FCF, EBITDA, EBITA, EBIT, EBITDAmargin, capital expenditure, capital expenditure as percentage of revenue, net financial debt, and net working capital. We have providedthese measures and other information in this presentation because we believe they provide investors with additional information to assessour performance. Our use of these supplemental financial measures may vary from others in our industry and should not be consideredin isolation or as an alternative to our results as reported under IFRS.
Due to rounding, numbers presented throughout this and other documents may not add up precisely to the totals providedand percentages may not precisely reflect the absolute figures.
OSRAM Licht AGQ4 FY17 Earnings Release (preliminary, unaudited figures) | November 06, 2017
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“OSRAM successfully delivered against its strategic and financial targets in 2017. We accelerated our transformation into a technology company and have continued our investments in future growth. Today OSRAM is well positioned as a technology leader driving growth through innovation.
Our outlook for FY18 builds on the expectation of continuing our growth momentum, whilst investing into innovation and the expansion of our global footprint.
Based on the strong performance in FY17 we will propose to increase our dividend by 10% to €1.10.”
Fiscal Year 2017 –A successful, important year for OSRAM
FY17 highlights• Revenue of €4,128m; comp. growth
at 8.1%, driven by OS and SP• Adjusted EBITDA margin of 16.8%; y-o-y
earnings grow with €43m• Positive free cash flow despite higher
capital expenditures • Delivered on guidance for FY17
Statement from the CEO
OSRAM Licht AGQ4 FY17 Earnings Release (preliminary, unaudited figures) | November 06, 2017
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Strong performance in FY17
Revenue (€m) / comp. growth
3,785
+8.1%
FY17
4,128
FY16
Strong growth, driven by OS and SP
EBITDA adj. (€m) / margin
+43
FY17
695
16.8%
FY16
652
17.2%
Strong increase in EBITDA
Free cash flow (€m)
99
24
+75
FY17FY16
Higher than prior year despite higher capital expenditures
Earnings per share, diluted (€)
2.78
FY16
2.511)
FY17
+10.8%Double Digit growth in EPS
1) Adjusted for proceeds from the FELCO disposal in FY16; Reported EPS in FY16 for continued operations = €5.12
OSRAM Licht AGQ4 FY17 Earnings Release (preliminary, unaudited figures) | November 06, 2017
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3 Pillar Strategy “Diamond“Innovation and Growth Initiative
“5.1.5“ in 2020
• Successful divestiture of Lamps Business (Ledvance)
• Footprint: Expansion Regensburg and Wuxi started. Plovdiv finalized. Kulim: Ready for Production
• M&A: Leddartech, Digital Lumens, Maneri-Agraz, LED Engin, Tvilight, Beaconsmind, Blickfeld
• R&D : Increased innovation spend for Digital Applications Roadmap
• Delivered important Milestones in FY17
Three Pillar Strategy and Diamond Initiative in full execution mode
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Growth Trend continues
Plovdiv
Kulim
Schwabmünchen
Regensburg
Ramp-up cost
1) Estimated adj. EBITDA based on ramp-up, FX effects and R&D (approx.)
Guidance FY18• Comp. Revenue growth: 5.5% – 7.5%• Adj. EBITDA: ~ €700m
Adj. EBITDA FY18 (€m)
~700
40 - 6030 - 40
~77070 - 75
ActualFY17
695
GuidanceFY18
~850
Adj. EBITDAFXRamp-UpR&D
R&DRamp-up
FX
Like-for-like1) FY18
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Global Digitalization Trends driving OSRAM’s future
Source: OSRAM, Analysis of 28 market segments with internal and external sources, Market: 2017, growth: 2017 – 2021 p.a.
Illuminating Sensing
Visualizing Treating
Market: ~€30bn
Growth: +5 – +10%
Market: ~€10bn
Growth: ~ +10%
Market: ~€5bn
Growth:> +20%
Market: ~€5bn
Growth: > +10%
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OS LSSSP
Market size in bn €
Financials based on FY17
17‘‘€ 20‘‘€
Industry position
Global No. 2
Segment revenue
1.7 bn €
adj. EBITDA
473m €
adj. EBITDA margin
28.1%
Free cash flow
62m €
Growth drivers:
AutomotiveSmartphoneGeneral Lighting
2016 2020
Infrared
Opto Semiconductors (OS)
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2008 2012 2016 2020 2024 2028 2030
Profitable Opportunities ahead
CONCEPTUAL
OS Market
Backlighting
General Lighting
Premium, IR Emitter, Laser
Visualization and Sensing
New biz opportunities for OSIHS 2015
OS LSSSP
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New Applications and a compelling Strategy are expected to generate double digit Growth
1) Infineon, ams AG, Seoul Semiconductor, Cree, Epistar, Everlight Electronics, HC Semitek, TI, Renesas
Focus Applications OS revenue development (€bn)
Adj. EBITDA margin
Peer group1)
20 – 24%Target range OS25 – 29%
Visualizationand Sensing
General Lighting
Premium, IR Emitter, Laser
OS Strategy
“Shape the future” Win in new
business opportunities
“Gain competitive scale” “Mega”-sites in a low-
cost-locations (Kulim, Wuxi)
“Grow the core” Strengthen techno-
logy leadership
1.7
16
1.4
15 17 19e 20e18e
1.1
OS LSSSP
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Construction of Kulim:The video can be found on our website
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• Construction on time (March 2016 – November 2017)
• Finished below budget• Production ramp up in November, 2017• Faster start of Premium production
OS in a leading industry Position –Technology, scale and factor cost
Best in Class & Market Leadership2. Scale and 3. Factor Cost
Kulim: Worldwide largest 6’inch LED fab is starting production
Revenue growth
Innovation
Profitability
11. Technology
OS LSSSP
Best factor costs and righteconomies of scale
Leading in technology
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OS on its way to become the largest Business Unit of OSRAM
OS expected revenue share by segments; OSRAM expected revenue share by Business Unit
~85%
~15%
~82-84%
~16-18%
Opto 2015 Opto 2020e
LSS
LED for GI
~7%OS
premium
SP
OSRAM 2020eBIZ-Plan 2015 ~ 35% BIZ-Plan 2015
~ 15%
LED for General Illumination
Automotive / Industry / Consumer1) (premium)
1) Mobile flash, backlighting, automotive signalling, automotive front lighting, automotive interior, infrared illumination, projection, laser, stage lighting, video wall, white goods
OS LSSSP
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Specialty Lighting (SP)
Automotive
Entertainment
Industry position
Global No. 1
Segment revenue
2.3bn €
Adj. EBITDA
339m €
adj. EBITDA margin
14.7%
Free cash flow
235m €
1)
Growth drivers:
AutomotiveEntertainmentIndustry
Market size in bn €
12‘‘€ 15‘‘€
2016 2020
1) In Automotive lighting, Financials based on FY17
OS LSSSP
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SSL Business
LED
System
Multi-function driver and controller
LEDs and electronics on PCB
Chip and Package
Fully integrated "Plug & Play" light engines
Assemblies
Lamp
Elec-tronics
FixtureFixture
HAL / HID / SIGN
Integrated / Non-Integrated
Traditional Business
Assemblies
Set
mak
er
Ligh
ting
Supp
lier
Set
mak
er
102989695
20202019
CAGR 2%
20182017
5.5
2017
4.1
CAGR 12%
2020
In million units; Source: IHS Sep 2017
Market development light vehicle production Exterior automotive lighting1), in € bn
Source: OSRAM market data
Electronics
Module
1) Light sources & controls market
Ligh
ting
Supp
lier
New Technologies triggering shifts in Value chains and new Opportunities for Collaboration
Trad.
LED
OS LSSSP
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Term Sheet signed: Possible Joint Venture with Continental offers additional value creation for OSRAM
Strengthens Technology and Market leadership position in Automotive Lighting
Enhances existing Automotive Lighting portfoliowith key new applications and competencies
Strong growth in a fast growing market (>10% p.a expected market growth)
Advanced Driver Assistance Systems • Dynamic and high-resolution light distribution• Shape car electronics architectureConnectivity • Car-to-Car (“seeing around the corner“)• Car-to-Infrastructure (traffic lights)
Autonomous Driving• Processing of vehicle environment data
LED Module Electro-nics System Fixture
OSRAM Continental GmbH
OS LSSSP
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AutomotiveSSL lighting
Joint Venture would create Opportunity to unlock further Revenue growth potential
1) Continental, Hella, Leoni AG, Norma Group, ElringKlinger, Ushio, Valeo, Autoliv Joint Venture
Focus Applications SP revenue development (€bn)
Adj. EBITDA margin
Peer group1)
11 – 15%Target range SP11 – 14%
SP Strategy
“Drive innovation” Front lighting,
electronics and sensor system
2.3
16 20e19e18e17
2.1
15
1.9
Special lighting “Focus and expand ” Entertainment
and Industry
AutomotiveTRAD lighting
“Last man standing” Market leader
(NAFTA and EMEA) Grow share in APAC
OS LSSSP
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Lighting Solutions and Systems (LSS)
Segment revenue
1.0 bn €
adj. EBITDA
-21m €
adj. EBITDA margin
-2.1%
Free cash flow
-68m €
Growth drivers:
Energy saving
Market size in billion €
67‘‘€ 89‘‘€
2016 2020
Beyond lighting
Industrial sites
City beautification
OS LSSSP
Financials based on FY17
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New businessBeyond Lighting
“Buy and Build” Digital Lumens,
Beaconsmind, …
DSSmart Components
Portfolio of 3rd Pillar “LSS” in motion
1) LSS: Zumtobel, Fagerhult, Philips Lighting New business
Focus Applications LSS revenue development (€bn)
Adj. EBITDA margin
Peer group1)
6 – 12%Target range LSS6 – 8%
LSS Strategy
“Selective expansion” Organic and
inorganic growth
20e19e18e17
1.0
16
1.0
15
0.9
OS LSSSP
LSGeneral Lighting
“Get profitable” Portfolio streamlining Cost structure,
Footprint
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Illuminating
Visualizing
Sensing
Treating
No autonomous driving without OSRAMAdaptive cruise control system (LIDAR)
LED / Laser head-up display
Headlamp (e.g. laser, matrix)
Pre crash sensing (LIDAR)Rain sensor
Daytime running light
Side view and lane detection
Ambient light sensor
Driver monitoring
Interior lightingAmbient lighting
Gesture recognition
3-D environment detection (LIDAR)
Rear light
LED Flash
Display backlighting
Bio-Monitoring
Eye tracking
IR remote controlGesture recognition
No digital communication without OSRAM
Ambient light sensor/ proximity sensor
Facial recognition
Iris-Scanning
Iris scan or facial recognition
Indicators
No wellbeing without OSRAM
Mobile Food-Analysis
Baby monitoring
Wearables
No entertainment without OSRAM
Concerts
Cinema
Shows & Events
Stage & Theatre
Studio, TV & Film
Wireless networks for park management
Personalized advertising
Indoor-Navigation
Access control
Integrated sensors for traffic detection and traffic control
Intelligent LED-street lights
Light management systemsLED-indoor luminaires
and components
Security applications
OSRAM equips Smart Cities
Digitalization and new Applications are creating significant Market opportunities for OSRAM
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Q4 FY17 comparable revenue growth at 12.4% (~7% excl. prior year carve-out effects)
Revenue growth continues for OS and SP; Market environment for LSS remains challenging
Q4 FY17 adjusted EBITDA margin improves 110 bps YoY to 15.5%
Free Cash Flow slightly negative in Q4 FY17 - as expected: OS capital expenditures (Kulim); FY17 Free Cash Flow positive with €99m
EBITDA Special Items at €42m in Q4 FY17, largely driven by cost structure measures for LSS; FY17 EBITDA Special Items at €74m in line with guidance
Q4 FY17 reported EPS at 40 Eurocents; adjusted EPS at 73 Eurocents (+ 45% YoY)
Summary financial performance: Strong finish of FY17
FY17 guidance delivered: Growth, Adj. EBITDA margin, EPS and FCF
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Strong growth continues in Q4 FY17
Revenue (€m)Comments Q4 FY17Quarterly development / comp. growth1)
991909
Q4/16
-0.6%
7.6%
Q2/17
3.2%
Q4/17Q1/17 Q3/17
12.4%
1,029
9.7%
1,0561,051
Regional split Q4 FY17
39.1%25.5%
35.4%
EMEA
AmericasAPAC
Comp. growth14.5%18.9%1.0%
1) Comparable growth year-over-year, adjusted for currency and portfolio effects.
Growth at approximately 7% when adjusted for carve-out related IT measures in Q4 FY16 (~ €47m)
APAC recorded double digit growth in all reporting segments
EMEA growth driven by SP and OS, double digit decline in traditional ballasts as LEDification of lighting controls accelerates
US market continues to be challenging for LSS
LED share at 68% vs. 65% in Q4 FY16
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Revenue (€m)
Weaker USD affects Q4 FY17 growth rates of all business units
OSRAM Group: Revenue bridge Q4 FY17 YoY
Revenue growth Q4 FY17
Nom.growth FX Portfolio Comp.
growth
Opto Semiconductors 15.3% -4.1% 0.0% 19.4%
Specialty Lighting 11.4% -4.1% 2.1% 13.4%
Lighting Solutions & Systems -5.9% -3.1% 3.1% -6.0%
Comments
Foreign exchange (FX) impact largely driven by appreciation of EUR against USD
Portfolio effect driven by M&A activities (NovitaTec, Maneri-Agraz, Digital Lumens, LED Engin) plus business with LEDVANCE
Nominal growth at 13.2%, currency effects of -400bps and portfolio effects of +480bps
-4.0%
FX
4.8%
Portfolio
12.4%
Comparable growth
1,029
Revenue Q4/17
Revenue Q4/16
909
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Volume growth driving increase in earnings and margin expansion
Adjusted EBITDA (€m) / Adjusted EBITDA margin (%)Adj. EBITDA contribution Q4 FY17 YoYAdjusted EBITDA margin1) Q4 FY17 YoY
1) Adjustment for special items (S.I.) includes e.g. transformation costs, substantial legal and regulatory matters, and costs related to mergers and acquisitions activities.
Adj. EBITDA margin Q4/17
15.5%
Volume / Mix / Other
1.6%
Portfolio
-0.5%
FX
0.0%
Adj. EBITDA margin Q4/16
14.4%
CommentsComments
Adjusted EBITDA margin above PYQ, driven by growth in OS and SP
Productivity programs deliver cost efficiencies of approximately €71m in the quarter
Contribution to profitability from OS and SP overcompensates lower profitability in LSS
Adjusted EBITDA in corporate items of €-26m in line with expectations; similar to PYQ
27-14
OS SP
14
Adj. EBITDA Q4/17
160
CIE
2
LSSAdj. EBITDA Q4/16
131
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Business units: Key financials Q4 FY17
429372
+19.4%
Q4/17Q4/16
12194
Q4/17
28.2%
Q4/16
25.4%OS
Revenue (€m) / Comp. growth (%) Adj. EBITDA1) (€m) / Adj. EBITDA margin (%)
551495
Q4/16
+13.4%
Q4/17
715811.7%
Q4/17
12.9%
Q4/16
SP
242258
-6.0%
Q4/17Q4/16
-76
2.5%
Q4/17
-3.0%Q4/16
LSS
Comments
OS Strong finish of FY17; all business segments contributing Profitability remains on high level despite ongoing investments
into innovation and marketing spend Kulim production start on track for November, 2017
SP SP grew by an estimated 6% (when adjusting for carve-out
related effects in PYQ) LED and aftermarket drive growth; Traditional light sources
with a modest decline
LSS Challenging business development especially in the US
market; APAC region with double digit growth Lack of growth and less favorable mix leads to negative
EBITDA Structural cost measures underway
1) Adjustment for special items (S.I.) includes e.g. transformation costs, substantial legal and regulatory matters, and costs related to mergers and acquisitions activities.
OSRAM Licht AGQ4 FY17 Earnings Release (preliminary, unaudited figures) | November 06, 2017
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Revenue / Adjusted EBITDA1) (€m) / Adjusted EBITDA margin (%)
Summary: FY17 performance in line with guidance
Adjusted EBITDA
69516.8%
Revenue
4,128
Comp. growth8.1%
Comments
FY17 growth acceleration for OSRAM driven by OS and SP;LSS business performance disappointing; challenging US market in H2; fast decline in traditional ballasts
Adjusted EBITDA at high level; OSRAM adj. EBITDA margin slightly lower due to LSS; lower OS margin reflects upfront investments into general lighting (R&D, M&S)
OS FY17 SP FY17 LSS FY17
OSRAM FY17
28.1%
Revenue
1,685
Comp. growth19.1%
Adjusted EBITDA
473
Adjusted EBITDA
339
14.7%
Revenue
2,312
Comp. growth6.7%
-2.1%
Revenue
989Comp. growth
-2.0%
Adjusted EBITDA
-21
+€43m/-40 bpsvs. PY
+€65m/-70 bpsvs. PY
+€34m/+40 bpsvs. PY
-€37m/-370 bpsvs. PY
1) Adjustment for special items (S.I.) includes e.g. transformation costs, substantial legal and regulatory matters, and costs related to mergers and acquisitions activities.
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FY17: Actively deployed capital of around €1bn; Positive free cash flow
Free Cash Flow / Asset Management / Net Liquidity (€m)Net liquidity bridgeFree cash flow1)
Net working capital (days outstanding2)) Capital expenditure (percent of revenue)
239443
21
€187m
FY17
537 (13.0%)
35 57
FY16
349 (9.2%)
41 69 Others / corporate
LSSSPOS
634655 662
-752-601580
544 (48)
Sep 30, 2016
634 (61)
-14.1%
Trade payables
Trade receivablesInventories
Sep 30, 2017
1) Defined as net cash provided by (used in) operating activities less capital expenditure.2) Defined as operating net working capital divided by revenue (last twelve months) times 365 days.
99
24
+75
FY17FY16
99
478
411396
Net liquidity Sep 30, 2017
Cash flow from disc. operations and others
-107
Other investing
and financial
items
-17
Dividend payment
-97
Share buyback
-165
Acquisitions and financial investments
-176
LEDVANCE sale
FCFNet liquidity Sep 30, 2016
OSRAM Licht AGQ4 FY17 Earnings Release (preliminary, unaudited figures) | November 06, 2017
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FY17 reported EPS of €2.78 in line with guidance
Earnings per share, diluted (€)Adjusted EPS FY17Adjusted EPS1) Q4 FY17
+44.6%
Q4/17
0.73
0.40
0.34
Q4/16
0.51
0.45
0.06
Reported EPSEPS from S.I.
Reported EPS of €2.78 approximately at midpoint of FY17 guidance (€2.70 – €2.90) FY16 reported EPS greatly impacted by a one time benefit related to the proceeds from the FELCO disposal (€2.61) Adjusted EPS grows close to 8% for the FY17 Tax rate at approx. 30%, in line with expectations
Comments
1) Adjustment for special items (S.I.) includes e.g. transformation costs, substantial legal and regulatory matters, and costs related to mergers and acquisitions activities.
Q4/17
3.38
2.78
0.60
FY17
+7.8%
FELCO2.61
2.51
FY16
3.14
-1.98
EPS from S.I.Reported EPS
5.12
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Assumptions FY18 guidance: Current business environment
Light vehicle production YoY
China
-0.1%
6.3%
NAFTA
1.5%
-2.6%
Europe
3.2%2.6%
IHS estimate 2018IHS estimate 2017
US nonresidential construction and electric lighting orders
Source: IHS report 10/2017 calendar year figures recalculated according to OSRAM fiscal year.
-10%
-5%
0%
5%
10%
15%
09/1709/13 09/14 09/15 09/1609/11 09/12
Census Bureau US Construction Nonresidential SA, YoY US Durable Goods New Orders Electric Lighting Equipment, 12 months rolling, YoY
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Foreign Exchange / Adjusted EBITDA1) (€m)
FX headwind expected for FY18
~37%~15%
~48%
EUR OthersUSD
Comments
Appreciation of EUR vs. USD expected to have unfavorable impact on OSRAM´s revenue and profitability in FY18 given the company´s unbalanced currency footprint
EUR / USD sensitivity: +/- 1 USD cent = ~ €9m adj. EBITDA (FY17 basis, annualized)
Hedging policy of OSRAM is at a minimum to hedge the total net currency position between 75% and 100% for the next three months
Revenue by currency
Exchange RateEUR / USD FY17 Assumption
FY18
Period end 1.18 1.18
Average 1.11 1.18Guidance, expected Adj. EBITDA
FY18
~700
Expected Business Improvement
(net of ramp-up cost)
75-80
FX
-70 to -75
Adj. EBITDA FY17
695
16.8%
Adjusted EBITDA development (expectation)
1) Adjustment for special items (S.I.) includes e.g. transformation costs, substantial legal and regulatory matters, and costs related to mergers and acquisitions activities.
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Outlook FY18
Comparable revenue growth:~ 5.5% - 7.5%
Adjusted EBITDA: ~ €700m
Free cash flow:~ €-50m - €-150m
Earnings per share: ~ €2.40 - €2.60
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Financial calendar and IR contact information
Upcoming events
November 09, 2017Deutsche Bank Conference, Paris, France & Roadshow, London, UK
November 10, 2017Roadshow, Frankfurt, Germany
November 13, 2017Roadshow, New York, USA
November 14-15, 2017UBS European Conference, London, UK
Munich Office + 49 89 6213 4875
Internet http://www.osram-group.de/en/investors
Email [email protected]
Investor Relations contact
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OSRAM Licht AGQ4 FY17 Earnings Release (preliminary, unaudited figures) | November 06, 2017
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Applications that will shape OSRAM‘s Future
Visualizing
Sensing
Treating
Illuminating
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No autonomous driving without OSRAM
Rear light
Interior lightingAmbient lighting
Adaptive cruise control system (LIDAR)Gesture recognition
Pre crash sensing (LIDAR)
Rain sensor
LED/Laser head-up display
Daytime running light
3-D environment detection (LIDAR)
Side view and lane detection
Ambient light sensor
Driver monitoring
Headlamp (e.g. laser, matrix)
LED – Non visibleLED – Visible
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No digital communication without OSRAM
LED – Non visibleLED – Visible
LED Flash
Display backlighting
Bio-Monitoring
Eye tracking
IR remote control
Gesture recognition
Ambient light sensor/proximity sensor
Facial recognition
Iris-Scanning
Iris scan or facial recognition
Indicators
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No wellbeing without OSRAM
Mobile Food-Analysis
Smart devices
Baby monitoring
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No entertainment without OSRAM
Concerts
Stage and Theatre
Studio, TV and Film
Shows and Events Cinema
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Wireless networks for park management
Personalized advertisementIndoor-Navigation
Access control
Integrated sensors for traffic detection and traffic control
Light management systemsLED-indoor luminaires and components
Security applications
OSRAM enables Smart Cities
Intelligent LED-street lightsLED – Non visibleLED – Visible
OSRAM Licht AGQ4 FY17 Earnings Release (preliminary, unaudited figures) | November 06, 2017
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OSRAM Continental GmbH
2018 2018Today
Internal/External Communication
Signing of JV Contract
Closing: Go Live “Day 1”
2021
Release of 1st joint developed product
Next steps and milestones
OSRAM Licht AGQ4 FY17 Earnings Release (preliminary, unaudited figures) | November 06, 2017
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Digitalization drives innovation across the whole value chain We broaden our competencies also by M&A
Electronic Software
System (Component/Module + Electronic + Software)
Solution (System + Service)
Service
Component/Module
OSRAM Licht AGQ4 FY17 Earnings Release (preliminary, unaudited figures) | November 06, 2017
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Overall highlights of employee survey
74
82
73
79
83
76
68
Leadership
Vision, values and strategy
Retention
Working conditions
Sustainable engagement
Empowerment
Openness
4
8
2
n/a
4
7
7
9
7
7
4
5
5
7
OSRAM overall 2014
High technology norm 2016Total favorable score
Improvement/Higher values compared to external norm
Key messages
• Significant improvements in all categories compared to 2014
• Outstanding results in comparison to other high tech companies
• 81% of employees worldwide participated
OSRAM Licht AGQ4 FY17 Earnings Release (preliminary, unaudited figures) | November 06, 2017
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Key financial metrics (preliminary, unaudited)Group (€m) Q4 FY16 Q4 FY17 Change (y-o-y) FY16 FY17 Change (y-o-y)
nom. 13.2% nom. 9.1%Revenue 909 1,029 comp. 12.4% 3,785 4,128 comp. 8.1%Gross margin 35.1% 33.2% -190 bps 35.7% 34.8% -100 bpsR&D -92 -95 3.5% -334 -364 9.0%SG&A -163 -190 16.4% -604 -697 15.4%EBITA 74 65 -12.9% 440 423 -3.8%
EBITA margin 8.2% 6.3% -190 bps 11.6% 10.3% -140 bpsAdj. EBITA 80 108 34.1% 471 500 6.2%
Adj. EBITA margin 8.9% 10.5% 160 bps 12.5% 12.1% -30 bps
EBITDA 125 118 -5.5% 621 621 0.0%EBITDA margin 13.7% 11.4% -230 bps 16.4% 15.1% -140 bps
Adj. EBITDA 131 160 21.8% 652 695 6.6%Adj. EBITDA margin 14.4% 15.5% 110 bps 17.2% 16.8% -40 bps
Financial result (including at-equity result) -5 -2 -61.8% 290 -8 -Income before income taxes 60 55 -8.0% 701 389 -44.5%Taxes -15 -15 -1.9% -169 -114 -32.4%Net income 44 40 -10.2% 532 275 -48.3%Diluted EPS in € 0.45 0.40 -11.1% 5.12 2.78 -45.7%
Free cash flow 30 -28 - 24 99 316.0%CAPEX -129 -192 48.5% -349 -537 53.7%Net liquidity 396 411 3.8% 396 411 3.8%Adj. net liquidity / EBITDA1) 0.4 0.4 0.0% 0.3 0.4 33.3%Equity ratio 51.8% 58.0% 620 bps 51.8% 58.0% 620 bpsEmployees (in thousands) 24.6 26.4 7.0% 24.6 26.4 7.0%
Please note: All numbers represent continuing operations, i.e. excluding Ledvance business sold in March 2017 and presented as discontinued operations starting Q4 FY16. 1) Adj. net liquidity: Net liquidity less pension plans and similar commitments.
OSRAM Licht AGQ4 FY17 Earnings Release (preliminary, unaudited figures) | November 06, 2017
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Segment overview (preliminary, unaudited)
Q4 FY17 (€m) OS2) SP2) LSS CIE OSRAM Licht Group
Revenue 429 551 242 -193 1,029Change % vs. PY reported 15.3% 11.4% -5.9% 13.2%Change % vs. PY comparable 19.4% 13.4% -6.0% 12.4%EBITA 88 51 -43 -32 65EBITA margin 20.6% 9.3% -17.9% 6.3%EBITA before special items 88 58 -13 -26 108EBITA margin before special items 20.6% 10.6% -5.4% 10.5%EBITDA 121 65 -37 -31 118EBITDA margin 28.2% 11.8% -15.2% 11.4%Special items EBITDA 0 -6 -30 -6 -42therein transformations costs 0 -2 -28 -4 -34EBITDA before special items 121 71 -7 -26 160EBITDA margin before special items 28.2% 12.9% -3.0% 15.5%
Assets1) 858 724 345 2,310 4,238Free cash flow -2 13 12 -50 -28
Additions to intangible assets and property, plant and equipment 161 22 8 1 192Amortization 1 4 3 1 8Depreciation 33 14 6 0 53
1) Net assets on segment level; total assets on group level; CIE includes reconciling items.2) Beginning with fiscal year 2017, certain external revenue in the automotive sector, yet reported in the OS segment, are reported at SP. Instead, OS now reports intersegment revenue (eliminated within the corporate consolidation).
Prior-year figures were adjusted accordingly.
OSRAM Licht AGQ4 FY17 Earnings Release (preliminary, unaudited figures) | November 06, 2017
45
Segment overview (preliminary, unaudited)
FY17 (€m) OS2) SP2) LSS CIE OSRAM Licht Group
Revenue 1,685 2,312 989 -858 4,128Change % vs. PY reported 18.9% 8.3% -1.5% 9.1%Change % vs. PY comparable 19.1% 6.7% -2.0% 8.1%EBITA 351 266 -96 -98 423EBITA margin 20.9% 11.5% -9.7% 10.3%EBITA before special items 351 289 -43 -97 500EBITA margin before special items 20.9% 12.5% -4.4% 12.1%EBITDA 473 317 -72 -97 621EBITDA margin 28.1% 13.7% -7.3% 15.1%Special items EBITDA 0 -22 -51 -1 -74therein transformations costs 0 -9 -49 1 -57EBITDA before special items 473 339 -21 -96 695EBITDA margin before special items 28.1% 14.7% -2.1% 16.8%
Assets1) 858 724 345 2,310 4,238Free cash flow 62 235 -68 -130 99
Additions to intangible assets and property, plant and equipment 443 57 35 2 537Amortization 3 14 7 2 26Depreciation 121 52 24 1 198
1) Net assets on segment level; total assets on group level; CIE includes reconciling items.2) Beginning with fiscal year 2017, certain external revenue in the automotive sector, yet reported in the OS segment, are reported at SP. Instead, OS now reports intersegment revenue (eliminated within the corporate consolidation).
Prior-year figures were adjusted accordingly.
OSRAM Licht AGQ4 FY17 Earnings Release (preliminary, unaudited figures) | November 06, 2017
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Consolidated statement of income (preliminary, unaudited)
Three months endedSeptember 30
Twelve months endedSeptember 30
2017 2016 2017 2016
Revenue 1,029 909 4,128 3,785Cost of goods sold and services rendered -687 -590 -2,692 -2,432Gross profit 342 319 1,436 1,353Research and development expenses -95 -92 -364 -334Marketing, selling and general administrative expenses -190 -163 -697 -604Other operating income 4 1 30 6Other operating expense -4 -1 -7 -9Income (loss) from investments accounted for using the equity method, net 0 0 -2 306Interest income 2 1 7 2Interest expense -3 -4 -12 -17Other financial income (expense), net 0 -1 -1 -2
Income before income taxes OSRAM (continuing operations) 55 60 389 701Income taxes -15 -15 -114 -169
Income OSRAM (continuing operations) 40 44 275 532Income (loss) from discontinued operation, net of tax 3 -92 -51 -134Net income (loss) 42 -48 224 398
Attributable to: Non-controlling interests 1 -1 3 1Shareholders of OSRAM Licht AG 41 -46 220 397
Basic earnings per share (in €) 0.43 -0.46 2.27 3.84Diluted earning per share (in €) 0.43 -0.46 2.26 3.83
Basic earnings per share (in €) OSRAM (continuing operations) 0.40 0.45 2.79 5.14Diluted earning per share (in €) OSRAM (continuing operations) 0.40 0.45 2.78 5.12
OSRAM Licht AGQ4 FY17 Earnings Release (preliminary, unaudited figures) | November 06, 2017
47
Consolidated statement of financial position (preliminary, unaudited)
As of September 30
As of September 30
As of September 30
As of September 30
2017 2016 2017 2016Assets Liabilities and equityCurrent Assets Current liabilitiesCash and cash equivalents 609 457 Short-term debt and current maturities of long-term debt 16 20Available-for-sale financial assets 2 1 Trade payables 752 601Trade receivables 634 580 Other current financial liabilities 29 50Other current financial assets 44 53 Current provisions 75 98Inventories 662 655 Income tax payables 99 89Income tax receivables 35 52 Other current liabilities 309 305Other current assets 112 192 Liabilities associated with assets held for sale 0 785Assets held for sale 2 1,136 Total current liabilities 1,280 1,948Total current assets 2,100 3,124 Long-term debt 184 42Goodwill 148 77 Pension plans and similar commitments 150 206Other intangible assets 142 113 Deferred tax liabilities 10 2Property, plant and equipment 1,396 1,060 Provisions 32 18Investments accounted for using the equity method 66 - Other financial liabilities 10 2Other financial assets 13 4 Other liabilities 111 97Deferred tax assets 314 384 Total liabilities 1,778 2,315Other assets 59 38 EquityTotal assets 4,238 4,801 Common stock, no par value 105 105
Additional paid-in capital 2,035 2,035Retained earnings 699 512Other components of equity 5 60Treasury shares, at cost -392 -237Total equity attributable to shareholders of OSRAM Licht AG 2,452 2,473Non-controlling interests 8 13Total equity 2,460 2,486Total liabilities and equity 4,238 4,801
OSRAM Licht AGQ4 FY17 Earnings Release (preliminary, unaudited figures) | November 06, 2017
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Consolidated statement of cash flows (preliminary, unaudited)
Three months ended Twelve months endedSeptember 30 September 30
2017 2016 2017 2016
Cash flows from operating activities
Net income (loss) 42 -48 224 398
Adjustments to reconcile net income (loss) to cash provided
Income (loss) from discontinued operation, net of tax -3 92 51 134Amortization, depreciation, and impairments 61 60 224 210Income taxes 15 15 114 169Interest (income) expense, net 1 4 5 15
(Gains) losses on sales and disposals of businesses, intangible assets, and property, plant and equipment, net 1 1 -16 2
(Gains) losses on sales of investments, net - - 0 -307(Income) loss from investments 0 - 2 0Other non-cash (income) expenses 7 - 27 3Change in current assets and liabilities
(Increase) decrease in inventories 19 -14 -23 -75(Increase) decrease in trade receivables -11 38 -62 -20(Increase) decrease in other current assets -2 -13 11 -101Increase (decrease) in trade payables 38 8 160 25Increase (decrease) in current provisions -9 5 -29 22Increase (decrease) in other current liabilities 19 46 -26 114
Change in other assets and liabilities 17 -4 12 14Special contributions to pension plans and settlement of a pension plan - - - -169Income taxes paid -32 -30 -45 -64Dividends received 0 0 0 1Interest received 2 1 7 2
Net cash provided by (used in) operating activities OSRAM (continuing operations) 164 159 636 373Net cash provided by (used in) operating activities discontinued operation -2 -25 -87 -186
Net cash provided by (used in) - OSRAM Licht Group (total) 163 134 548 187
Three months ended Twelve months endedSeptember 30 September 30
2017 2016 2017 2016
Cash flows from investing activitiesAdditions to intangible assets and property, plant and equipment -192 -129 -537 -349Acquisitions, net of cash and cash equivalents acquired -46 - -108 -Purchases of investments -59 - -68 -Proceeds and payments from sales of investments, intangible assets, and property, plant and equipment 0 -1 27 327Proceeds and payments from sales of business activities, net of cash and cash equivalents disposed of - 0 380 -1Net cash provided by (used in) investing activities OSRAM (continuing operations) -297 -130 -305 -23Net cash provided by (used in) investing activities discontinued operation - -9 -14 14Net cash provided by (used in) investing activities -OSRAM Licht Group (total) -297 -139 -319 -9Cash flows from financing activitiesPurchase of treasury stock -1 -93 -165 -234Proceeds from issuance of long-term debt - - 150 -Repayment of long-term debt -2 - -8 -Change in short-term debt and other financing activities -9 4 -3 9Interest paid -1 3 -9 1Dividends paid to shareholders of OSRAM Licht AG - - -97 -94Dividends paid to non-controlling interest shareholders -4 - -7 -Net cash provided by (used in) financing activities OSRAM (continuing operations) -18 -86 -139 -319Net cash provided by (used in) financing activities discontinued operation - -20 -16 -24Net cash provided by (used in) financing activities -OSRAM Licht Group (total) -18 -106 -154 -343Effect of exchange rates on cash and cash equivalents -9 -2 -25 -3Net increase (decrease) in cash and cash equivalents -162 -113 50 -168Cash and cash equivalents at beginning of period 771 672 559 727Cash and cash equivalents at the end of period 609 559 609 559Less: Cash and cash equivalents of discontinued operation at end of the reporting period - 102 - 102Cash and cash equivalents at end of period (consolidated statement of financial position) 609 457 609 457