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Datalogic

Investor Presentation Mar 19, 2019

4452_ct_2019-03-19_18842f14-3c5b-4baa-8ac6-19e803b69b88.pdf

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FY 2018 Results Conference Call

19 MARCH 2019

Disclaimer

This document has been prepared by Datalogic S.p.A. (the "Company") for use during meetings with investors and financial analysts and is solely for information purposes. The information set out herein has not been verified by an independent audit company. Neither the Company nor any of its subsidiaries, affiliates, branches, representative offices (the "Group"), as well as any of their directors, officers, employees, advisers or agents (the "Group Representatives") accepts any responsibility for/or makes any representation or warranty, express or implied, as to the accuracy, timeliness or completeness of the information set out herein or any other related information regarding the Group, whether written, oral or in visual or electronic form, transmitted or made available. This document may contain forward-looking statements about the Company and/or the Group based on current expectations and opinions developed by the Company, as well as based on current plans, estimates, projections and projects of the Group. These forward-looking statements are subject to significant risks and uncertainties (many of which are outside the control of the Company and/or the Group) which could cause a material difference between forward-looking information and actual future results. The information set out in this document is provided as of the date indicated herein. Except as required by applicable laws and regulations, the Company assumes no obligation to provide updates of any of the aforesaid forward-looking statements. Under no circumstances shall the Group and/or any of the Group Representatives be held liable (for negligence or otherwise) for any loss or damage howsoever arising from any use of this document or its contents or otherwise in connection with the document or the aforesaid forward-looking statements. This document does not constitute an offer to sell or a solicitation to buy or subscribe to Company shares and neither this entire document or a portion of it may constitute a recommendation to effect any transaction or to conclude any legal act of any kind whatsoever.

This document may not be reproduced or distributed, in whole or in part, by any person other than the Company. By viewing and/or accepting a copy of this document, you agree to be bound by the foregoing limitations.

Revenues acceleration in Q4

Vertical Results

FY 2018

Double digit growth in NA thanks to projects on Fixed Retail Scanners And Mobile Computers Double digit growth in China & NA (Net FX) mainly driven by industrial barcode scanners Double digit growth mainly driven by big project in NA with TIER1 parcel companies Decrease due to big projects in NA in 2017

Best quarter of the year driven by NA Double digit growth in NA partially offset by slow down in APAC Slow down in all region due to big project fasing Best quarter of the year with signs of recovery thanks to new project in NA

* Includes Revenues not directly allocated to the Verticals

weight
on Total
€m FY 2018 Var % Net Fx
50.4% Retail 295.4 5.4% 8.0%
29.8% Manufacturing 174.6 11.5% 13.1%
11.8% Transportations & Logistic 69.2 13.6% 15.8%
3.5% Healthcare 20.2 (28.6%) (26.9%)
4.5% Channel (Unallocated)* 26.3 (30.7%) (30.3%)
93% Datalogic 585.7 3.9% 5.9%
4% Solution Net Systems 28.3 14.5% (0.5%)
3% Informatics 19.6 (4.9%) 20.2%
0% Elimination (2.6)
100% Group 631.0 4.1% 6.4%
weight
on Total
€m Q4 2018 Var % Net Fx
52.5% Retail 81.3 9.4% 8.0%
28.3% Manufacturing 43.8 5.7% 5.4%
12.0% Transportations & Logistic 18.6 (7.7%) (8.7%)
4.2% Healthcare 6.6 (5.7%) (7.2%)
2.9% Channel (Unallocated)* 4.4 31.0% 31.3%
94% Datalogic 154.7 5.8% 4.8%
4% Solution Net Systems 5.9 8.5% 5.1%
3% Informatics 5.0 17.9% 14.2%
0% Elimination (0.6)
100% Group 164.9 6.2% 5.1%

Group Revenues by geography

Declining trend entirely due to Retail; positive growth for T&L and Manufacturing Stellar performance in 2019 driven by double digit growth in Retail, T&L and Manufacturing (Fx Net) Entirely driven by China (+13,9%) thanks to Manufacturing (+29,7%)

FY 2018

Q4

Growth driven by Retail

Results impacted by Retail (mainly Italy) and T&L project seasonality Double digit growth driven by Retail

Positive trend due to Retail in APAC, slow down Manufacturing in China

weight
on Total
€m FY 2018 Var % constant FX
50.9% EMEA 320.9 (2.0%) (1.6%)
32.6% North America 205.6 13.8% 18.4%
13.8% Asia Pacific 87.3 9.7% 13.3%
2.7% Latin America 17.2 (5.3%) 2.0%
100.0% Total Revenues 631.0 4.1% 6.4%
weight
on Total
€m Q4 2018 Var % constant FX
50.2% EMEA 82.9 (7.7%) (7.9%)
32.1% North America 52.9 33.9% 29.7%
14.0% Asia Pacific 23.0 12.2% 11.7%
3.7% Latin America 6.1 11.1% 14.7%
100.0% Total Revenues 164.9 6.2% 5.1%

Memor™ 10, new PDA validated for the Google™-led initiative "Android Enterprise Recommended" program for rugged devices.

  • 24 New Product launched in 2019 (12 only in Q4).
  • Main accomplishments:

  • R&D investments reaching 9.8% on Revenues (10.2% on DL Business)

  • New SLS launched
  • Hired 90+ people in R&D, reaching 500 people
  • Patents above 1.200 items; +53 IDs harvested in 2018

2018 New Product Launches and innovation

PowerScan PD9530 becomes PD9531

S3Z Miniature Sensor

AREX 400 family of Fiber Laser Marker

Q4 2018 P&L

Q4 2018 Q4 2017 Var%
164.9 155.3 6.2%
Acceleration in Q4 driven by NA +33.9% vs LY
(+29.7% vs Net FX)
79.2 75.9 4.4%
Revenues
up 6.2% to €164.9m (+5.1% Net FX)
48.0% 48.9%
(55.2) (54.3) 1.8%
Gross Margin up 4.4% to €79.2m.
(33.5%) (34.9%)
Operating expenses up by 1.8% to €55.2m.
28.0 25.4 10.3%
17.0% 16.4%
EBITDA margin from 16.4% to 17.0% thanks to
higher volumes compensating Operating
22.4 20.4 9.9% expenses increase.
13.6% 13.1%
1.14 1.18

FY 2018 P&L

2018 2017 Var%
4.1%
306.0 288.4 6.1%
48.5% 47.6%
(215.6) (199.8) 7.9%
(34.2%) (33.0%)
105.5 103.3 2.2%
16.7% 17.0%
83.5 82.9 0.8%
13.2% 13.7%
77.8 75.5 3.2%
(15.6) (15.4)
62.2 60.1 3.5%
9.9% 9.9%
1.18 1.13
631.0 606.0

Revenues
up
4.1%
to
€631.0
m
(+6.4%
at
constant
exchange
rate)

Gross
Margin
showing
steady
improving
trend
at
48.5%
(around
+90
bps
vs
2017)

Operating
expenses
up
by
7.9%
to
€215.6m.

R&D
on
revenues
up
to
9.8%
(10.2%
on
DL
Business)

S&D
on
revenues
from
16.5%
to
17.8%
(+130
bps
YoY)
due
to
strengthening
of
commercial
organization

G&A
on
revenues
decreased
by
7.9%.
moving
from
7.4%
to
6.6%
on
revenues

EBITDA
margin
at
16.7%
improved
Gross
Margin
and
volumes
partially
offsets
higher
R&D
and
Distribution
expenses

EBT
up
by
3.2%
thanks
to
financial
charges
decrease

Tax
Rate
at
20.1%
in
line
with
previous
year

Net income at €62.2m

Group EBITDA by division

  • Datalogic EBITDA increasing by 2.2% vs 2017.
  • Solution Net Systems EBITDA substantially in line with 2017 (2.9 m€); EBITDA margin decreased by 110 bps due to Royal mail big Postal projects.
  • Informatics EBITDA improvement thanks to cost control and mix
Division FY 2018 Var %
DL Business 102.1 1.9%
% on Revenues 17.4%
Solution Net Systems 2.9 3.0%
% on Revenues 10.4%
Informatics 0.7 358.2%
% on Revenues 3.4%
Adjustments (0.2)
Group 105.9 2.5%
% on Revenues 16.8%

EBITDA: actual vs last year

* Excluding Service and other non significant items

€m 2018
Dec 2018
2017
Dec 2017
€m 2018
Dec 2018
2017
Dec 2017
Total Fixed Assets 369.7 347.9 Net Financial Position (23.8) (30.1)
Trade receivables 90.4 85.8
% on 12m rolling sales 14.3% 14.2%
Inventories 95.8 85.9
% on 12m rolling sales 15.2% 14.2%
Trade payables (117.1) (110.3) Net Equity 375.8 353.0
% on 12m rolling sales -18.6% -18.2%
Trade Working Capital 69.1 61.5
% on 12m rolling sales 11.0% 10.1%
Other assets/liabilities (86.9) (86.5)
Net Invested Capital 352.0 322.9 Total Sources 352.0 322.9
€m 2018
Dec 2018
2017
Dec 2017
€m 2018
Dec 2018
Total Fixed Assets 369.7 347.9 Net Financial Position (23.8)
Net Equity 375.8
Net Invested Capital 352.0 322.9 Total Sources 352.0

Consolidated Balance Sheet

Net Debt & Cash Flow Analysis : Dec'17 – Dec'18

2019 Outlook

Verticals

Group Financials

  • Keep growth trend on Revenues.
  • Substantially stable EBITDA margin.
  • Maintain a strong Cash Generation from operations .

  • Focus on Innovation: increase R&D investment.

  • Commercial organization: Selective hiring in key areas NA and APAC.
  • Ramp up of new products launched in the last 12 months (ie: Shift to Android OS).
  • Strong new products pipeline.àò

Retail: outlook remain very positive in NA; expected recovery in EMEA and APAC along the year thanks to new

Manufacturing: NA as growth engine of 2019 thanks to increase coverage.

T&L: keep the pace in NA and leveraging cross selling thanks to new products.

  • products.

  • HC: back to growth.

  • the channel.

Channel: SMB expected recovery thanks to new products particularly suitable for

April 30, 2019 Shareholders' meeting

May 14, 2019 1Q 2019 Results

August 7, 2019 6M Results

November 13, 2019 9M Results

Contact

IR CONTACTS

IR Manager Vincenza Colucci CDR Communication Srl Tel. +39 335 6909547 [email protected]

IR Assistant Daniela Giglioli Tel. +39 051 3147109 Fax +39 051 3147205 E-mail [email protected]

[email protected] Via Candini, 2 40012 Lippo di Calderara di Reno Bologna – Italy

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www.datalogic.com

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This presentation contains statements that are neither reported financial results nor other historical information. These statements are forward-looking 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

© 2019 Datalogic S.p.A. and/or its affiliates - All rights reserved. • Without limiting the rights under copyright, no part of this documentation may be reproduced, stored in or introduced into a retrieval system, or transmitted in any form or by any means, or for any purpose, without the express written permission of Datalogic S.p.A. and/or its affiliates • Datalogic and the Datalogic logo are registered trademarks of Datalogic S.p.A. in many countries, including the U.S. and the E.U. • All other trademarks and brands are property of their respective owners.

Datalogic S.p.A.

Via Candini, 2 - 40012 Lippo di Calderara di Reno - Bologna (Italy) Tel. +39 051 3147011 | Fax +39 051 3147205 [email protected] ww.datalogic.com

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