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Cherry AG Investor Presentation 2024
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Investor Presentation
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WELCOME TO CHERRY'S ANALYST & INVESTOR DAY
25 April 2024
CHERRY
FORWARD LOOKING STATEMENTS
DISCLAIMER
This presentation contains forward-looking statements.
These statements are based on the current views, expectations and assumptions of the management of Cherry SE and involve known and unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in such statements. Actual results, performance or events may differ materially from those described herein due to factors affecting Cherry SE such as, among other things, changes in the general economic and competitive environment, capital market risks, currency exchange rate fluctuations and competition from other companies, and changes in international and national laws and regulations, in particular with respect to tax laws and regulations. Cherry SE does not assume any obligation to update any forward-looking statements.
The information contained in this presentation is for background purposes only and does not purport to be full or complete. No reliance may be placed, for any purpose, on the information contained herein or its accuracy or completeness. The information in this presentation is subject to change.
MARKET & INDUSTRY DATA
This presentation also contains estimates and other statistical data made by independent parties and by the Company relating to the Company's industry, the Company's business and the market for the Company's products and its future growth. This data involves a number of assumptions and limitations, and you are cautioned not to give undue weight to such estimates. In addition, projections, assumptions, and estimates of the Company's future performance and the future performance of the market for its products are necessarily subject to a high degree of uncertainty and risk.
GENERAL REMARK
Figures may not add up due to rounding.
CHERRY
Cherry SE Analyst & Investor Day • 2
AGENDA
2:00 p.m. Welcome & Agenda, Head of IR Nicole Schillinger
2:05 p.m. Overview of the company's situation, CEO Oliver Kaltner
2:15 p.m. Presentation of selected 2023 financial data, Interim CFO Volker Christ
2:30 p.m. Presentation Q1, 2024, Interim CFO Volker Christ
2:35 p.m. Roadmap 2025: Status report on implementation, CEO Oliver Kaltner
2:45 p.m. Update on Business Units, CEO Oliver Kaltner
3:00 p.m. BREAK
3:05 p.m. Transformation update, COO Dr. Udo Streller
3:15 p.m. Outlook, CEO Oliver Kaltner
3:30 p.m. Q&A, Facilitator Nicole Schillinger
4:00 p.m. End of Event
CHERRY
Cherry SE Analyst & Investor Day • 3
EXECUTIVE TEAM IN THE ROOM FOR YOU TODAY
Oliver Kaltner
CEO
Experienced CEO with proven track record in IT, digital, consumer electronics and branded companies, both in large corporations and SMID as well as start-ups.
Udo Streller
COO
More than 20 years of management experience in operational excellence, including constructing and managing factories, R&D, product management, supply chain management procurement.
NON-EXECUTIVE
Volker Christ
Interim CFO
Extensive management experience in international CFO positions and other finance responsibilities for listed and non-listed companies in various industries.
CHERRY
Cherry SE Analyst & Investor Day • 4
CHERRY
Cherry SE Analyst & Investor Day • 5
Oliver Kaltner, CEO CHERRY SE
STATE OF PLAY
TAKING FINAL STEPS TO CLOSE THE CHAPTER OF OVERPROMISING & UNDERDELIVERY
Management taking action to turn around Cherry
- 2023 marks Cherry’s turn of time, from overpromising until 2023 to delivery from 2024 onwards
- Successful clean up of operating structure by COO Dr. Udo Streller
- Streamlining of financial structure and processes by Interim CFO Volker Christ in progress
Financing secured
Contract with lending bank valid unchanged until mid-2026
Resulting shifts on the timeline
- Release of audited annual report 2023 postponed to 22 May
- AGM postponed to 24 July
CHERRY
Cherry SE Analyst & Investor Day • 6
A CHALLENGING FINANCIAL YEAR
Revenues
€ 126.5m
Adj. EBITDA
€ 2.1m
Adj. EBITDA
margin
1.6%
Cash & equivalents
€ 46.1m
COUNTERMEASURES TO INCREASE PERFORMANCE
MX 2
Switch
Multi-level distribution partnerships
Strict cost and cash management
Optimization of financial processes
Brand relaunch
Corporate culture initiative
CHERRY
Cherry SE Analyst & Investor Day • 7
IN 2023 WE HAVE FAILED TO MEET OUR OWN STANDARDS
Revenues: € 126.5m
Adj. EBITDA: € 2.1m
- Target Revenue of € 140m not met
- GOP*: Demand growth in computer peripherals fell short of own expectations as customers reduced their inventory; sales forecast accuracy in H2 significantly behind H1
- DHS*: Delay in sales of TI terminals and PIN-Pads
-
COMPONENTS: MX1 switch no longer competitive
-
Adj. EBITDA margin: 1.6%
- Adj. EBITDA target of 10 % not met
- EBITDA adjustments predominantly restructuring costs for personnel and write-down machinery.
*All financial KPI as of December 31, 2023
** GOP = GAMING & OFFICE PERIPHERALS, DHS=DIGITAL HEALTH & SOLUTIONS
CHERRY
Cherry SE Analyst & Investor Day • 8
COUNTERMEASURES INITIATED TO INCREASE FINANCIAL PERFORMANCE
MX 2 Switch
- FY 2023: Project North
- FY 2024: Full implementation
- Cost savings: € >5,5m p.a.
- Intense and strict cost and cash management to improve financial strength
New Partners
- Focus markets: DACH, France, UK, Netherlands, Spain, Americas, China
- Additional direct & distribution partners: MediaMarkt/Saturn, Elgiganten, Fnac&Darty and Dixons
CASH & COSTS*: SUFFICIENT LIQUIDITY AVAILABLE
- Cash and cash equivalents: € 46.1m
- Trade working capital**: € 75.2m
- Positive assessment of business model by principal bank
- € >10m cost reduction program initiated
- Implementation well underway
CHERRY
Cherry SE Analyst & Investor Day • 9
BUSINESS STRATEGY – ITS ALL ABOUT EXECUTION & RELEVANCE
2024e revenues € 140m - € 150m
EBITDA margin 7-8%
driven by organic growth
Profitability
Strict cost management
Restructuring program
Streamlined product portfolio
Debt reduction & internal financing
Cost and Liquidity Management
Focus on growth areas & innovation
Trends: E-Sports, hybrid work,
dynamic healthcare market.
Additional distribution partners
Market Aligned Segment Structure
CHERRY
Cherry SE Analyst & Investor Day • 10
Volker Christ, Interim CFO CHERRY SE
FINANCIAL RESULTS 2023
CHERRY
Cherry SE Analyst & Investor Day • 11
REVENUE IN FY 2023: DECLINE VS. PRIOR YEAR AND FORECAST MISS
Full year revenue*
Revenue development by quarter
Revenue by quarter and business unit
* Forecast 2023: Revenue € 140m / adjusted EBITDA margin of 10% not met; Q4 2023 and FY 2023 data unaudited and preliminary
CHERRY
Cherry SE Analyst & Investor Day • 12
2023 ADJ. FY EBITDA OF € 2.1M AND 1.6% FY MARGIN DRAGGED BY MOUNTING COMPONENT LOSSES
Prelim. EBITDA Cherry Group in 2023: € - 10.3m Adjusted EBITDA Cherry Group in 2022: € 15.2m Q4 2023 and FY 2023 data unaudited and preliminary
CHERRY
Cherry SE Analyst & Investor Day • 13
FUTURE PROFIT ALLOCATION TO FUND GROWTH STRATEGY
Profit improvement to ensure the Group's ability to grow
No new share buyback program / 4.6 % Treasury shares at Dec 31, 2023
No dividend payout
CHERRY
Cherry SE Analyst & Investor Day • 14
CHERRY
FINANCIAL RESULTS Q1 2024
CHERRY SE Analyst & Investor Day • 15
Q1 2024 REVENUE OF € 30.3 M IS UP +5.5 % YOY AND WELL ABOVE GUIDANCE AND CONSENSUS
Q1 revenue vs. previous year, own forecast and consensus in € m
Revenue split by business units in € m
CHERRY
Cherry SE Analyst & Investor Day • 16
ADJUSTED EBITDA MARGIN INCREASED BY 7.4 PPT. YOY IN Q1 2024
Q1 adj. EBITDA margin vs. own forecast* and consensus
* Q1 2024 adj. EBITDA company forecast: break-even
Q1 adj. EBITDA* split by business unit in € m
* Q1 2023
CHERRY
Cherry SE Analyst & Investor Day • 17
ACTIVE COST MANAGEMENT EXPECTED TO MATERIALIZE IN 2024
Cost cutting by category (ytd)*
- Company forecast
| Cost Reduction Program 2024 | Target in € m* |
|---|---|
| Restructuring benefits | € 5.5m |
| SG&A | € 4.6m |
| Material savings / other | € 3.1m |
| Head Count Development | FTE |
| --- | --- |
| FTE Avg. 2023 | 456 |
| Initiated reduction | 105 |
| Target 2024 | |
| (August: Program completed) | 351 |
CHERRY
Cherry SE Analyst & Investor Day • 18
IMPROVED INVENTORY MANAGEMENT*
€ 56m as of Q1 24
€ 72m as of Q1 24
* Q4 2023 preliminary unaudited figures
** Apr – Dec 2024 company forecast; Trade working capital = Inventories + accounts receivable ./. accounts payable
CHERRY
Cherry SE Analyst & Investor Day • 19
FREE CASH FLOW* EXPECTED TO BREAK-EVEN AT THE END OF THE YEAR
€ 1m / -8m as of Q1 24
Cumulative capex and free cash flow development
- Q4 2023 preliminary unaudited figures, company forecast for Q2-Q4 2024
CHERRY
Cherry SE Analyst & Investor Day • 20
CHERRY
Oliver Kaltner, CEO CHERRY SE
ROADWAP 2025: STATUS REPORT IMPLEMENTATION
CHERRY SE Analyst & Investor Day • 21
STEPS TO REVITALIZE CHERRY SE
CHERRY
Cherry SE Analyst & Investor Day • 22
SWITCH BUSINESS
PERIPHERALS FOR GAMING AND (HYBRID) OFFICE
HEALTH & SECURITY
Digital Health & Solutions
E-Health terminals /
encryption & disinfection devices
SUCCESSFUL POSITIONING OF BUSINESS ACTIVITIES IN CORE MARKETS ALONG MAJOR GLOBAL TRENDS
STREAMLINED PRODUCT PORTFOLIO, FOCUS ON GLOBAL TRENDS
Efficiency gain: from 1,500 to 500 product and component versions (SKUs) until 2027
Product cycle:
- MX1 – 39 years
- MX2 – 3 years
- MX3 - 2025
CHERRY
Cherry SE Analyst & Investor Day • 23
CHERRY GROUP HOLDING STRUCTURE TO BECOME LEANER
CHERRY
Cherry SE Analyst & Investor Day • 24
EXPERIENCED LEADERSHIP TEAM:
SELECTED CHERRY LEADERSHIP PROFILES (I)
René Schulz, MD Gaming & Office Peripherals
- Joined Cherry in 2022
- 19 years in high-tech industry, leading strategic growth and digital transformation
- Before joining Cherry, he grew Logitech's B2B biz from USD 0.5 to 1.0 bn and established the Global Account Program at GN Netcom (Jabra)
Gerrit Schick, MD Digital Health & Solutions
- Joined Cherry in 2022
- 25+ years experience in Healthcare and Medical products businesses of HP, Agilent Technology, and Philips
- Various leadership roles in Sales, Marketing, Operations, Strategy, and R&D
Andreas Zacher, MD Components
- Joined Cherry in 2023
- 19 years in various leadership roles of international partner sales with Microsoft Corp
- 25+ years in IT
Nadine Meier, Head of Procurement
- Joined Cherry in 2006
- 15+ years in Supply Chain Operations
- Since 2018 Head of Supply Chain Operations
Polly Fu, APAC Sales & Marketing Director
- Joined Cherry in 2021
- Leads CHERRY BUP APAC commercial team
- 22 years in consumer electronics; 10 years marketing and 12 years sales experience
Albert Karl, Senior Director Operation Europe
- Joined in 2017 & leads the Cherry Operations Europe
- 20+ years of experience in various production areas (Metal / Electro / Renewable Energies)
- Previously at Stihl Switzerland
CHERRY
Cherry SE Analyst & Investor Day • 25
EXPERIENCED LEADERSHIP TEAM:
SELECTED CHERRY LEADERSHIP PROFILES (II)
Josh Philipps, CEO and MD Cherry Americas, LLC
- Joined Cherry in 2024
- 21 years in consumer electronics with computer and wireless device peripherals focus
- Formerly CRO of Vinci Brands, VP of Sales at Zagg, VP of SteelSeries, Americas
Tanja Knahn, Head of Brand & Communication
- Joined Cherry in 1991
- 30+ years Marketing Communication and Public Relations experience
- Accompanied Cherry in all transition phases from owner managed company to stock listed company
Claus Stehlik, SD Technology & Engineering
- Joined Cherry in 2021
- 30+ years in software and hardware development and 20+ years managerial experience
- Technology evangelist at Cherry
- Compliance Officer and ESG reporting responsibility
Peter Göbel, SVP People and Culture
- Joined Cherry in 2022
- 17+ years in different local & global People & Culture leadership roles
- Experience in various industries; previously responsible as HR Director EMEA for a 5000+ employee workforce.
Dr. Anna Wolschner, General Counsel
- Joined Cherry in 2023
- 7 years of experience as General Counsel at listed companies
- 8 years with international law firms specializing in Corporate Law, Capital Markets, and M&A
Nicole Schillinger, SVP Investor Relations
- Joined Cherry in 2024
- Previously 6 years IR leadership roles at Sixt SE and Reimann Investors
- 13 years in Equity Research and Sales with Deutsche Bank, Dresdner Kleinwort Wasserstein, and Barclays Capital
CHERRY
Cherry SE Analyst & Investor Day • 26
COST REDUCTION OF € 10-15M P.A.
DRIVEN BY RESTRUCTURING AND OVERHEAD SAVINGS
CHERRY
Cherry SE Analyst & Investor Day • 27
TOP PRIORITY: LIQUIDITY MANAGEMENT, CASH FLOW GENERATION, AND COST STEERING
Inventory reduction to drive net cash (schematic)
SG&A costs to decline significantly
- as % of revenue
CHERRY
Cherry SE Analyst & Investor Day • 28
CHERRY
Oliver Kaltner, CEO CHERRY SE
UPDATE BUSINESS DIVISIONS:
COMPONENTS
Cherry SE Analyst & Investor Day • 29
CHERRY'S PORTFOLIO COVERS THE WHOLE RANGE OF SWITCHES FOR MECHANICAL GAMING AND OFFICE KEYBOARDS
MX Switch Series – the Gold Standard
- Cherry has produced several billions of mechanical switches in total.
- High-profile MX2 with gold-plated contacts sets the standard for gaming keyboards. Multipoint feature serves strategy and shooting gamers.
- The MX switch family will soon be entering its third generation (2025).
- Version MX Multipoint with inductive contact closure without metal contact.
- Can close 10 times per button press.
Low Profile Switch – high scalability
- Hybrid switch for gamers as well as for office keyboards and therefore suitable for a wide target group.
- Silent LP versions are also available.
Ultra Low Profile Switch – notebook gamechanger
- 3.5 mm ULP switch installed in own and partners’ gaming (e.g. Corsair) and office (e.g. Mistel) keyboards, but above all in top tier gaming notebooks from partners as Dell (Alienware), Medion (Erazer), MSI and starting in Q4 also in HP (Omen series).
- In talks with three major OEMs
- Next gen. ULP will also be suitable for thinner gaming and office notebooks.
CHERRY
Cherry SE Analyst & Investor Day • 30
SWITCHES VOLUMES TO THIRD PARTIES EXPECTED TO RECOVER STRONGLY
External shipments (in units)
- Production in D for switch families LP and ULP as well as for all MX switches used in Cherry's own keyboards
- Assembly in China for partner product switches
- High degree of automation in Auerbach
- Revival of previously terminated business relationships with third party peripherals producers due to competitive pricing
- Market share to recover from current c. 10%
CHERRY
Cherry SE Analyst & Investor Day • 31
GAMING & OFFICE PERIPHERALS
CHERRY
Cherry SE Analyst & Investor Day • 32
IMPROVED RESOURCE ALLOCATION IN FOCUS MARKETS
CHERRY
Cherry SE Analyst & Investor Day • 33
KEYBOARD AND MOUSE MARKET TO REACH USD 12.2BN BY 2032*
Global keyboard and mouse market*
Global USD 4.9bn keyboard market split**
- Source: Dataintello ** Source: Statista 2024
CHERRY
Cherry SE Analyst & Investor Day • 34
CHERRY
CAMING ON GROWTH PATH
Cherry SE Analyst & Investor Day • 35
CAMING ON GROWTH PATH
PROMISING GAMING MARKET TRENDS IN GERMANY
In 2022, 38% of Germans played video games on personal computers at least weekly
Computer gamers play very frequently: 26% play at least 10 or more hours per week, 12% even 20 or more hours.
% of gamers who would buy tech brand from country
Most important brand attributes to gamers when buying tech
| How its quality compares to other brands | 56% |
|---|---|
| It is a brand I have experience with | 51 |
| How its price compares to other brands | 50 |
| Online reviews of the brand from other users | 27 |
| It is a well-known brand | 26 |
| It is a brand recommended by my friends and family | 21 |
Source: All data from GfK Gaming Consumers DACH Report, October 2023
CHERRY
Cherry SE Analyst & Investor Day • 36
EXPANSION FROM CHINA TO EUROPE AND THE USA
Gaming keyboard sales in China (ths. units)**
US markets still flattish***
- China is the world's largest market with USD c. 300m in keyboard sales and 2% CAGR 24 -28; Cherry with 7% market share*
- Strong competition from local brands
- 7% share of USD c. 35m S. Korean market**
-
2023 Cherry grew 7% vs. flat market
-
EUR 120m EU3 market size**
- Room for improvement: low brand awareness and c. 1% market share
- Germany: 4% share;
-
38% of gamers play at least weekly; 56% regard quality most important attribute
-
World's 2nd largest market with USD c. 200m in keyboard sales***
- Increasing preference for high-quality mechanical gaming keyboards
- Cherry present since 2023; <1% market share
-
New MD hired from the US gaming scene
-
Source: Statista
** Source: GfK. To facilitate the presentation of market growth and share data we focus on keyboards, our largest product category.
*** Source: NPD
CHERRY
Cherry SE Analyst & Investor Day • 37
CHERRY
OFFICE PERIPHERALS: FOCUS MARKETS
CHERRY SE Analyst & Investor Day • 38
OFFICE BENEFITING FROM WORK-FROM-ANYWHERE AND UPGRADING TRENDS
Post pandemic market recovery on track* (% yoy)
2 in Germany with high corded share**
- New distribution partners and retail listings
- Stronger focus on core markets
- From push to pull in non-core markets
- Margin upside from wireless push
- Market opportunity in mice from current low market share of 7%
- Working capital management aided by more focused SKU planning
-
Accelerated E-Commerce activities
-
EU3 (D + F + GB) keyboard without Gaming market size of EUR 300m. Source: GfK. ** In Q4 2023 unit sales. Source: GfK.
CHERRY
Cherry SE Analyst & Investor Day • 39
SIGNIFICANT POTENTIAL THROUGH INTERNATIONAL EXPANSION
Favorable market conditions
- 83% of US employees consider good technology and important factor (vs. 76% globally)***
- Increasing demand for higher value mechanical keyboards
- C. 70% online sales
- Chip manufacturers bellwether show sales uptick
Recent strategic steps
- Management change
- Shift from POS equipment to omnichannel & consumer focus
APAC market share potential
- Office segment still underpenetrated
- Trend towards higher quality keyboards as Gaming users grow up into business world
Recent strategic steps
- Optimized management alignment
- Increased penetration of APAC markets like S-Korea, Taiwan, and Japan
- Portfolio expansion: mechanical office keyboards
*** OWL Labs, The State of Hybrid Work 2023.
CHERRY
Cherry SE Analyst & Investor Day • 40
DIGITAL HEALTH & SOLUTIONS
CHERRY
Cherry SE Analyst & Investor Day • 41
SIGNIFICANT POTENTIAL THROUGH INTERNATIONAL EXPANSION
CHERRY
Cherry SE Analyst & Investor Day • 42
E-HEALTH DRIVEN BY PRODUCT INNOVATION AND SERVICES INTRODUCTION ON A MICRO AND REGULATORY DECISIONS / GOVERNMENTAL BUDGETS ON A MACRO LEVEL
PIN-Pad
- Extension for E-Health terminals; payment option
- Required with introduction of e-patient file
- Mobile version for mobile care and midwives
E-Health Terminal
- Gematik-certified* and NFC-capable
- Cherry with >75% share of newly installed terminals in a duopolistic market
- Late start due to delayed intro of e-prescription (Jan 24) and e-patient file (expected Jan 25)
- Strong acceleration in sales since Nov 23
- Large single order secured
Service offerings
- Terminal-as-a-Service = leasing model
- Terminal Management Service
- ☑ Remote terminal management from April 24; reduction of c. 50% of technician onsite visits
-
☑ 1st step on premise; mid-term as cloud solution
-
Gematik = national agency for digital medicine, controlled by the Federal Ministry of Health
CHERRY
Cherry SE Analyst & Investor Day • 43
MEDICAL AND OTHER HYGIENE SOLUTIONS – US OPPORTUNITY
Medical and Hygiene
- Focus markets: DACH; UK, F, USA, Southern and Eastern Europe
- Increasing demand in Europe, market share c. 20%
- Opportunity in North American HC market: Medical keyboards and mice market at c. USD 225m by 2027
- First orders from US hospitals secured
- Cherry perceived as best quality / price ratio
- Sustainable positive post-Covid effect on demand
- Work-on-wheel market to grow to USD 2.2 bn by 2027.
Other Protected
- Protection membrane for usage in libraries, restaurants, universities etc.
- Industrial: Food processing, agriculture, and construction industries
CHERRY
Cherry SE Analyst & Investor Day • 44
SECURITY AND EMBEDDED SOLUTIONS
Security for authorities, corporates, and the military
- >90% of revenues with card reader keyboard Synergies with GOP and Hygiene/Protect
- Large deals
- Current tender with very large customer
- Cost management: In-house production of the sophisticated PC board component
- Product pipeline: Contactless reader units
Cherry Embedded Solutions
- Theobroma Systems – acquired in 2021 – fully vertically integrated and highly scalable
- 3rd party business: Linux based IOT-smartboards
- Focus area: healthcare markets, e.g. medical dispensers
- Upside from large orders
- Customers: Medical products and autonomous robot companies
CHERRY
Cherry SE Analyst & Investor Day • 45
CHERRY
Cherry SE Analyst & Investor Day • 46
BREAK
Dr. Udo Streller, COO CHERRY SE
TRANSFORMATION UPDATE
CHERRY
Cherry SE Analyst & Investor Day • 47
OPERATIONS – TEAM STRUCTURE
- As of Jan. 1, 2024
CHERRY
Cherry SE Analyst & Investor Day • 48
OPERATIONS AT A GLANCE – ESG & COST, SPEED, QUALITY
[A] For ESG incl. Compliance the strategy review and 2024 roadmap cycle was completed, the Non-Financial Report 2023 will be published timely.
(B) For Cost, Speed & Quality the development of performance shows a stable & positive trend for all of Cost Elements like Materials/Purchasing, Logistics, CDF-Program, Yields/Scrap rates, Cost of poor Quality, ... The Project North & Delivery Performance are very well on track and Quality & Customer returns well under control.
The originally challenging inventory level shows a significant and steady improvement trend with target to keep an inventory corridor of 50 – 55 MEUR in Q2'24.
| Act 07'23 | Act 12'23 | Act 01'24 | Act 02'24 | Act 03'24 | FC 06'24 | |
|---|---|---|---|---|---|---|
| Group | 82,24 | 62,72 | 62,06 | 59,18 | 56,19 | 51,7 |
| GOP | 42,15 | 38,23 | 37,80 | 35,69 | 33,40 | 32,4 |
| DHS | 14,47 | 12,93 | 12,91 | 12,37 | 11,46 | 10,9 |
| COMP | 13,22 | 9,20 | 9,29 | 9,13 | 8,20 | 7,3 |
| Others | 2,40 | 2,36 | 1,85 | 1,98 | 3,13 | 2,1 |
CHERRY
Cherry SE Analyst & Investor Day • 49
FOOTPRINT 2024 (PROJECT „NORTH“)
| Phase 1 (06-11'23)
Evaluation & decision | Phase 2 (11'23)
Announcement & preparation | Phase 3 (12'23 – 09'24)
Execution |
| --- | --- | --- |
| ✓ Footprint eval
✓ Business case eval
✓ Subcon pre-eval
✓ Pre-team
✓ SVB / EB alignment
✓ SVB authorization 3rd Nov'23
✓ Communication & material prep | ✓ Investor info Nov'23
✓ Employee info Nov'23
✓ Kick-off Project Team
✓ Kick-off ARB
✓ Kick-off Subcon China contract
✓ Materials & Toolings to China
✓ Kick-off 2^{nd} source Plastics China | ✓ M1a: Subcon contract signed E12'23
✓ M1b: Interessenausgleich ARB E12'23
✓ M2a: 1^{st} Assembly MX2 E01'24
✓ M2b: People global
✓ M3: SOP Assembly MX2 E03'24
○ M4: 2^{nd} source Plastics Qual E06'24
✓ M5: kick-off Project MX3
07'24 → 03'24 (Gate A) |
CHERRY
Cherry SE Analyst & Investor Day • 50
FOOTPRINT 2024 (PROJECT „NORTH“) – STATUS @ APRIL'24
(A) Achievements
- China Contract signed ahead of target (27.12.23),
- 1st tool set in place ahead of target (29.1.24), production area / facilities in place
- 1st set released for assembly production ahead of target (07.03.24)
- 2nd tool set with +20% performance delivered and will be released within April'24
- All People (globally) related task closed
(B) Next steps (May/June'24)
- Material Qualification / localisation in progress according timeline
- China compression moulding tooling definition & order
- Order of assembly equipment set 3-6
CHERRY
Cherry SE Analyst & Investor Day • 51
OPERATIONS AT A GLANCE – TECHNOLOGY & INNOVATION
(C) For Technology / Innovation incl. Project Management
- a revised Product development Process, KPI & reporting scheme is in place since end Jan'24
- a company-wide aligned new innovative approach, a Switch Technology strategy for 2024 and respective innovation team is in place with 1st significant results (Community Switches 2024, MX Gen3 Gate A,...)
- a Software & Firmware Strategy was (pre)defined and respective Innovation team software/firmware was kicked-off @ 19th March'24
- an overall Technology roadmap process was developed & 2024 revision cycle put in place with 9 Focus Technologies per content & roadmap defined and in execution for 2024
- the Re-org & rescope for global Project Management done by Jan'24 with standardized reporting & KPI setup in place
CHERRY
Cherry SE Analyst & Investor Day • 52
CHERRY
Cherry SE Analyst & Investor Day • 53
Oliver Kaltner, CEO CHERRY SE OUTLOOK
OUTLOOK FY 2024: TOPLINE EXPECTED TO INCREASE BY MORE THAN 12%
CHERRY
Cherry SE Analyst & Investor Day • 54
OUTLOOK FY 2024: PROFITABILITY TO INCREASE BY 5.9PPT. YOY
CHERRY
Cherry SE Analyst & Investor Day • 55
THE NEXT QUARTER: WHAT WE AIM FOR IN Q2
Revenues
Q2 2024e: above previous year
Q2 2023: € 32.6m
Adj. EBITDA margin
Q2 2024e: approx. 5%
Q2 2023: 13.8%
GAMING & OFFICE PERIPHERALS
Europe: Retail listings with major chains
China: Building on successful launch of 8k mice
Americas: Increased channel visibility, Staples listing
DIGITAL HEALTH & SOLUTIONS
Germany: Ongoing strong demand for E-Health terminals
Americas: Active Key products the standard in two hospitals
COMPONENTS
Basis effect, strong comps in Q2 2023
Agreements with OEM and hardware partners
Delivery on optimized financial calendar
Preliminary Q2 figures to be announced at our AGM on 24 July 2024
CHERRY
Cherry SE Analyst & Investor Day • 56
OUTLOOK FY 2024: INTERNAL PLANNING BASIS
- Positive sell-out allows budgeted sell-in into distribution channels
- Increased market presence through new sales partnerships
- Regulatory market opening for digitalization in the healthcare sector
- Market growth for Gaming and hygienic peripherals in the USA
- Tight internal budget management
- Cost reduction and relocation of production, cash-effective in 2024
CHERRY
Cherry SE Analyst & Investor Day • 57
CHERRY
Cherry SE Analyst & Investor Day • 58
Nicole Schillinger, CHERRY SE
Q&A
IR CONTACT
NICOLE SCHILLINGER
SVP INVESTOR RELATIONS
E-MAIL [email protected]
PHONE +49 9643 2061 848
WEB https://ir.cherry.de
CHERRY