Datalogic — Call Transcript 2016

May 13, 2016

1Q2016 Conference Call

May 13th, 2016

Agenda

1Q 2016

Outlook

1Q 2016

* new products refer to products announced in the last 24 months

1Q 2016 Highlights

Revenues

• +10.7% YoY to 135.4 mln Euro (+9.6% at constant exchange rate) mainly thanks to Europe and North America, the primary markets for the Group
• Booking at 140 mln Euro

EBITDA

• +19.9% YoY to 18.8 mln Euro (+21.8% at constant exchange rate) EBITDA margin at 13.9% (14.3% at constant exchange rate)
• Investment in R&D grew by 4.4% YoY with an incidence of 9% on revenues

Net Profit

• Financial costs almost halved due to refinancing
• Around 1 mln Euro loss on exchange rate vs a 4 mln Euro gain in 1Q 2015
• Net profit is in line with last year result

€000	1Q2016	1Q2015	YoY%	4Q2015	QoQ %
Revenues	135,353	122,316	10.7%	143,773	(5.9%)
Gross Operating Profit	62,127	57,887	7.3%	65,869	(5.7%)
EBITDA	18,820	15,689	19.9%	20,670	(9.0%)
EBITDA Margin	13.9%	12.8%		14.4%
EBIT	14,210	10,785	31.8%	14,856	(4.3%)
Net Profit	10,073	9,893	1.8%	10,125	(0.5%)

Identification AV7000 High Performance Linear Camera

• New generation CMOS sensor with 40% greater sensitivity
• Pulsed Lighting System (PLS), patented technology
• The only camera in the Auto-ID industry able to collect high quality "single shot" complete images on large conveyors avoiding "puzzle effect"

Machine Vision 11.8 IMPACT SW Release

New Camera calibration modes

• Pin Point Pattern Find tool improvements
• IMPACT SDK
• Extended camera support

Machine Vision MX-E Series

• New line of Vision Processors powered by IMPACT Software.
• Ethernet (GigE Vision) connectivity and multi-camera support

1Q 2016 Profit and Loss

€000	1Q2016		1Q2015		Var %
Revenues	135,353	100.0%	122,316	100.0%	10.7%
COGS	(73,226)	(54.1%)	(64,430)	(52.7%)	13.7%
Gross Operating Profit	62,127	45.9%	57,886	47.3%	7.3%
Other Revenues	372	0.3%	691	0.6%
R&D	(12,100)	(8.9%)	(11,594)	(9.5%)	4.4%
Distribution Costs	(25,162)	(18.6%)	(24,008)	(19.6%)	4.8%
Administrative Expensives	(9,466)	(7.0%)	(9,776)	(8.0%)	(3.2%)
Other operating expensives	(327)	(0.2%)	(458)	(0.4%)
Total Operating expenses and others	(47,055)	(34.8%)	(45,836)	(37.5%)	2.7%
Non recurring costs/rev	-	-	(462)	(0.4%)
Amort. Intang. Assets from acquis.	(1,234)	(0.9%)	(1,495)	(1.2%)	(17.5%)
Operating Profit (EBIT)	14,210	10.5%	10,785	8.8%	31.8%
Financial (costs)/rev.	(1,032)	(0.8%)	(2,421)	(2.0%)	(57.4%)
Foreign exchange (costs)/rev	(919)	(0.7%)	3,944	3.2%
EBT	12,259	9.1%	12,308	10.1%	(0.4%)
Taxes	(2,186)	(1.6%)	(2,415)	(2.0%)
Net Income	10,073	7.4%	9,893	8.1%	1.8%
Depreciation	(2,145)	(1.6%)	(1,808)	(1.5%)	18.6%
Ammortization	(1,231)	(0.9%)	(1,140)	(0.9%)	8.0%
EBITDA	18,820	13.9%	15,690	12.8%	19.9%
Exchange Rate	1.102		1.1261

Revenues Trend by Division

• ADC Division is the driver in Europe and in North America (+10.9%, +9.9% at constant exchange rate)
• POS check out fixed scanners with the new imaging technology and hand held scanners are driving growth in Retail
• The Industrial Automation division is improving +11.8% (+10.9% at constant exchange rates) and net of the BU Systems, the division's revenues increased by 6.5% (+5.9% at constant exchange rates)
• BU Systems: revenues +65.2% thanks to new orders from major clients like Royal Mail and others in the postal and retail markets (print and apply solutions)

REVENUES BY DIVISION (%)

REVENUES BY DIVISION
€mln	1Q 2016	1Q 2015	Var %
ADC	93.2	84.0	10.9%
IA	35.5	31.7	11.8%
- IA ex BU Systems	30.7	28.9	6.5%
Informatics	7.4	7.0	4.7%
Corporate and Adj.	(0.7)	(0.5)	n.m.
Total Revenues	135.4	122.3	10.7%

Revenues Trend by Country

REVENUES BY GEOGRAPHIC AREA

€mln	1Q 2016	1Q 2015	Var %
Europe	73.1	63.9	14.4%
North America	39.6	33.6	17.7%
Asia Pacific	14.9	15.6	(4.5%)
ROW	7.8	9.2	(15.4%)
Total Revenues	135.4	122.3	10.7%

• Europe continues to generate robust growth both in ADC (+13.2%) and IA (+19.3%), confirming the leadership of the Group
• North America: strong growth of ADC (+ 24.3%, + 21.7% at constant exchange rate) driven by retailers while in IA good improvements of the BU Systems
• Asia Pacific experienced a delay in products delivery in Q1 expected to be recovered in Q2 as confirmed by current booking
• ROW affected by the economic downturn in Latin America

1Q2016 Segment Reporting: GOP and EBITDA

ADC IA Informatics Corporate Total Group 1Q 2015 1Q 2016

Gross Operating Profit	1Q 2016	1Q 2015	EBITDA* Margin	1Q 2016	1Q 2015
ADC	47.2%	48.4%	ADC	23.8%	22.1%
Industrial Automation	42.1%	45.0%	Industrial Automation	1.3%	1.6%
- IA ex BU Systems	45.8%	51.6%	- IA ex BU Systems	2.3%	8.1%
Informatics	46.3%	45.3%	Informatics	4.0%	0.5%
Total Group	45.9%	47.3%	Total Group	13.9%	12.8%

(*) With the purpose to better report the operating sectors economic performances, it was deemed appropriate to highlight the Divisional EBITDA as monitoring KPI.

1Q2016 Segment Reporting: R&D and TWC

1Q 2015				1Q 2016

R&D/Revenues	1Q 2016	1Q 2015
ADC	6.9%	7.4%
Industrial Automation	10.8%	11.3%
Informatics	5.4%	3.8%
Total Group	8.9%	9.5%

TWC/Annualized Revenues	1Q 2016	1Q 2015
ADC	10.5%	11.7%
Industrial Automation	16.1%	18.0%
Informatics	12.9%	14.1%
Total Group	11.5%	13.2%

Consolidated Balance Sheet at 31.03.2016

	TOTAL ASSETS	EQUITY	AND NFP
€ mln
Other Assets	33.1
Trade Working Capital	62.0	113.8	Other Liability
		34.7	Net Financial Position
Total Fixed Assets	352.5	299.1	Equity

Outlook

2016 Outlook

• Double Digit Growth in Europe and North America improving Market Share
• Expected benefit from the "ONE " Datalogic approach in China
• Expected recovery of Operations Efficiency going forward thus reducing weight of COGS on revenues thanks to:
• the new Procurement Centre in China
• to plants rationalisation (new Hungarian plant for IA)
• insourcing of components in the second half of 2016
• Continuous focus on R&D and launch of new products
• Maintain strong performance on cash

Contact

IR CONTACTS

IR Manager Vincenza Colucci CDR Communication Srl Tel. +39 335 6909547 E-mail vincenza.colucci@cdrcommunication.it E-mail ir@datalogic.com

IR Assistant Daniela Giglioli Tel. +39 051 3147109 Fax +39 051 3147205 E-mail daniela.giglioli@datalogic.com

Via Candini, 2 40012 Lippo di Calderara di Reno Bologna – Italy

NEXT EVENTS

August 4th, 2016 6M results

November 11th, 2016 9M results

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This presentation contains statements that are neither reported financial results nor other historical information. These statements are forwardlooking statements. These forward-looking statements rely on a number of assumptions and are subject to a number of risks and uncertainties, many of which are outside the control of Datalogic S.p.A., that could cause actual results to differ materially from those expressed in or implied by such statements, such as future market conditions, currency fluctuations, the behavior of other market participants and the actions of governmental and state regulators

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Datalogic S.p.A. Via Candini, 2 40012 Lippo di Calderara di Reno Bologna – Italy Tel. +39 051 3147011 Fax +39 051 3147205 E-mail corporate@datalogic.com