Skip to main content

AI assistant

Sign in to chat with this filing

The assistant answers questions, extracts KPIs, and summarises risk factors directly from the filing text.

Sign up Log in

Hexagon Composites Investor Presentation 2014

Aug 28, 2014

3619_rns_2014-08-28_0b80648a-6ed8-40e8-94d1-f7fe4c569e0f.pdf

Investor Presentation

Open in viewer

Opens in your device viewer

2QUARTER 2014 ND

Oslo, 28th August 2014

Jon Erik Engeset, CEO David Bandele, CFO

DISCLAIMER AND IMPORTANT NOTICE

This company presentation (the "Presentation") has been prepared by Hexagon Composites ASA ("Hexagon" or the "Company"). The Presentation has not been reviewed or registered with, or approved by, any public authority, stock exchange or regulated market place. The Company makes no representation or warranty (whether express or implied) as to the correctness or completeness of the information contained herein, and neither the Company nor any of its subsidiaries, directors, employees or advisors assume any liability connected to the Presentation and/or the statements set out herein. This presentation is not and does not purport to be complete in any way. The information included in this Presentation may contain certain forward-looking statements relating to the business, financial performance and results of the Company and/or the industry in which it operates. Forward-looking statements concern future circumstances and results and other statements that are not historical facts, sometimes identified by the words "believes", expects", "predicts", "intends", "projects", "plans", "estimates", "aims", "foresees", "anticipates", "targets", and similar expressions. The forward-looking statements contained in this Presentation, including assumptions, opinions and views of the Company or cited from third party sources are solely opinions and forecasts which are subject to risks, uncertainties and other factors that may cause actual events to differ materially from any anticipated development. None of the Company or its advisors or any of their parent or subsidiary undertakings or any such person's affiliates, officers or employees provides any assurance that the assumptions underlying such forward-looking statements are free from errors nor does any of them accept any responsibility for the future accuracy of the opinions expressed in this Presentation or the actual occurrence of the forecasted developments. The Company and its advisors assume no obligation to update any forward-looking statements or to conform these forward-looking statements to the Company's actual results. Investors are advised, however, to inform themselves about any further public disclosures made by the Company, such as filings made with the Oslo Stock Exchange or press releases. This Presentation has been prepared for information purposes only. This Presentation does not constitute any solicitation for any offer to purchase or subscribe any securities and is not an offer or invitation to sell or issue securities for sale in any jurisdiction, including the United States. Distribution of the Presentation in or into any jurisdiction where such distribution may be unlawful, is prohibited. This Presentation speaks as of 28th August 2014, and there may have been changes in matters which affect the Company subsequent to the date of this Presentation. Neither the issue nor delivery of this Presentation shall under any circumstance create any implication that the information contained herein is correct as of any time subsequent to the date hereof or that the affairs of the Company have not since changed, and the Company does not intend, and does not assume any obligation, to update or correct any information included in this Presentation. This Presentation is subject to Norwegian law, and any dispute arising in respect of this Presentation is subject to the exclusive jurisdiction of Norwegian courts with Oslo City Court as exclusive venue. By receiving this Presentation, you accept to be bound by the terms above.

AGENDA

  • •Group Highlights
  • •Group Financials & Segment overview
  • •Outlook
  • •Q & A

CONTINUED GROWTH

OPERATING REVENUES

NOK Million

HIGHLIGHTS Q2 2014

  • • Full capacity utilization at Hexagon Ragasco and Hexagon Lincoln
  • Lincoln has returned to normal delivery times
  • • Introduction of the TITAN™ XL has received positive response
  • First orders taken in Q3
  • •Light Duty in the black
  • •Hexagon Raufoss nominated by major car manufacturer
  • • Partnership with Agility Fuel Systems moving as planned
  • Replacements for competitor products at Agility to begin delivery in Q3.

GAS DISTRIBUTION PRODUCTS (GDP)

  • •Satisfactory quarter
  • • Gaining momentum in the oil & gas industry
  • High Horse Power applications
  • •Solid order intake

HEAVY DUTY VEHICLES

  • • Temporary softening in the U.S. Heavy Duty market
  • ̵ Underlying market drivers unchanged
  • • Bus markets in the U.S. and Europe very strong
  • First bus order to Indonesia secured shortly after end of Q2

LIGHT DUTY VEHICLES

  • • European Passenger car market exhibits stronger than expected growth
  • • Hexagon Raufoss nominated by major car manufacturer ̵First deliveries targeted for 2017

LOW PRESSURE (LPG)

  • •Plant running 24/7/365
  • • Up-time very high in April and May, but disruptions in June EBIT effect MNOK 7
  • •Strong European demand

2QUARTER 2014 GROUP FINANCIALSND

Q2 2014 GROUP INCOME STATEMENT

N
O
K
T
H
O
U
S
A
N
D-		 O
S
G
*
T
H
R
E
E
M
N
T
H
E
N
D
I
N		 S
O
S
G
*
I
X
M
N
T
H
E
N
D
I
N		 T
W
E
O
M
N
E
N
D
I		 V
E
L
S
T
H
G
*
N
3
0.
0
6.
1
4		 3
0.
0
6.
1
3		 Va
ia
r
nc
e		 3
0.
0
6.
1
4		 3
0.
0
6.
1
3		 Va
ia
r
nc
e		 3
1.
1		 2.
1
3
O
t
in
In
p
e
ra
g
c
o
m
e		 3
9
4
1
6
7		 3
2
1
9
5
7		 7
2
2
1
0		 8
0
4
6
9
6		 6
2
8
6
7
7		 1
7
6
8
2
0		 1
2
1
7		 6
2
2
O
ing
t
p
e
ra
e
xp
e
ns
e
s		 (
)
3
1
3
7
1
8		 (
)
2
5
5
0
4
9		 (
5
8
6
6
9
)		 (
)
6
3
9
1
3
5		 (
)
5
1
3
0
2
2		 (
1
2
6
1
1
3
)		 (
1
0
6
7		 )
2
6
0
E
B
I
T
D
A		 8
0
4
4
9		 6
6
9
0
8		 1
3
4
1
5		 1
6
5
5
6
1		 1
1
4
8
5
4		 0
0
5
7
7		 2
0
4		 3
6
2
De
ia
t
io
d
im
irm
t
p
re
c
n
a
n
p
a
e
n		 (
1
7
6
2
4
)		 (
1
4
8
9
1
)		 (
)
2
7
3
3		 (
3
5
6
1
6
)		 (
2
8
6
0
3
)		 (
)
7
0
1
3		 (
6
2		 2
9
8
)
E
B
I
T		 6
2
8
2
5		 2
0
1
5
7		 1
0
8
0
8		 1
2
9
9
4
5		 8
6
2
1
5		 4
3
6
9
4		 1
4
2		 0
6
4
S
ha
f p
f
i
t
/
(
lo
)
fro
ia
t
re
o
ro
s
s
m
a
s
s
o
c
e
s		 (
1
0
3
6
)		 (
1
6
8
2
)		 6
4
6		 (
1
7
9
2
)		 (
1
8
5
5
)		 6
3		 (
4		 2
2
4
)
O
f
(
)
t
he
ina
ia
l
i
t
t
r
nc
e
m
s
ne		 (
5
0
4
1
)		 5
7
4		 (
6
1
)
5
5		 (
1
3
9
3
2
)		 1
0
0
3		 (
1
4
9
3
)
5		 (
9		 3
9
6
)
f
fo
fro
Pr
i
t
b
t
t.
t
io
o
e
re
ax
m
c
o
n
o
p
e
ra
ns		 5
6
7
4
8		 5
0
9
0
9		 8
3
9
5		 1
1
4
2
2
1		 8
5
3
9
9		 2
8
8
2
2		 1
2
8		 4
4
4
Ta
ex
p
e
ns
e
x		 (
1
7
8
6
6
)		 (
1
7
0
9
4
)		 (
)
7
7
2		 (
3
6
8
1
6
)		 (
2
7
9
1
7
)		 (
)
8
8
9
9		 (
4
1		 7
4
2
)
Pr
f
i
t
f
t
t
fro
t.
t
io
o
a
e
r
ax
m
c
o
n
o
p
e
ra
ns		 3
8
8
8
3		 3
3
8
1
5		 5
0
6
8		 4
0
7
7
5		 4
8
2
5
7		 1
9
9
2
3		 8
6		 0
2
7
Pr
f
i
/
(
lo
)
fro
ie
he
l
d
fo
le
t
o
s
s
m
c
o
m
p
a
n
s
r s
a		 - 1
7
3
2		 (
1
3
2
)
7		 4
8
5
5		 2
3
5
6		 2
4
9
9		 2 9
4
1
f
/
(
)
fo
Pr
i
t
lo
t
he
o
s
s
r
y
e
a
r		 3
8
8
8
3		 3
5
5
4
7		 3
3
3
6		 8
2
2
6
0		 5
9
8
3
8		 2
2
4
2
2		 8
9		 6
4
3
E
B
I
T
D
A
%		 2
0.
4
%		 2
0.
8
%		 2
0.
6
%		 1
8.
3
%		 1
6.
1
%
E
B
I
T
%		 %
1
5.
9		 %
1
6.
2		 %
1
6.
2		 %
1
3.
7		 %
1
1.
2

Q2 '14* V '13* INCOME STATEMENT HIGHLIGHTS

  • • High-pressure drives NOK 51 million growth (24%) •
  • • Low-pressure drives 21 million growth (19%)
  • High-pressure at 21.0% margin
  • Low-pressure at 23.9% margin
  • NOK 3 million depreciation effect (Low-pressure 1, High-pressure 2)
  • •Tax effect of -NOK 1 million

•

  • Finance and other contributions effect of -NOK 5million (FX 3; Interest 2)
  • • Divested business –NOK 2 million

Consolidating growth and stabilising margins

•

www.hexagon.no

H1 '14* V '13* INCOME STATEMENT HIGHLIGHTS

  • • High-pressure drives NOK 108 million growth (25%) •
  • • Low-pressure drives 69 million growth (33%)
  • High-pressure at 20.6% margin
  • Low-pressure at 26.2% margin
  • NOK 7 million depreciation effect (Low-pressure 4, High-pressure 3)
  • •Tax effect of -NOK 9 million
  • Finance and other contributions effect of -NOK 15 million (FX 10; Interest 5)
  • • Divested business +NOK 2 million

Strong organic growth and margins

•

•

GROUP EBITDA Q2 '14* V Q2'13*

Low-pressure – solid turnover in quarter but lower margin than prior year

*Figures have been restated according to the Equity accounting method for Joint Ventures as of 1st January 2014 14

www.hexagon.no

FINANCIAL POSITION V PREVIOUS QUARTER

N
O
K
T
H
O
U
S
A
N
D		 3
0.
6.
2
0
1
4
*		 3
1.
3.
2
0
1
4
*		 C
ha
ng
e
In
ta
i
b
le
ts
ng
as
se		 9
2
7
0
0		 1
0
0
9
5
5		 (
8
2
5
5
)
Ta
i
b
le
f
ixe
d
ts
ng
as
se		 2
3
9
8
4
7		 2
3
3
4
2
9		 6
4
1
8
O
t
he
t
ts
r
no
n-
cu
rre
n
as
se		 3
9
0
4		 3
5
4
7		 3
9
3
To
l
No
As
ta
t
ts
n-
cu
rre
n
se		 3
3
6
4
8
7		 3
3
7
9
3
1		 (
1
4
4
4
)
Inv
ies
to
en
r		 2
4
9
0
5
6		 2
1
6
7
6
5		 3
2
2
9
1
Re
iva
b
les
ce		 2
0
0
0
7
7		 2
0
3
2
4
7		 (
3
1
7
0
)
Ba
k
de
i
ts
h a
d s
im
i
lar
n
p
os
ca
s
n
,		 1
6
8
9
1
2		 1
8
9
3
6
2		 (
2
0
4
0
)
5
To
ta
l
Cu
t
As
ts
rre
n
se		 6
1
8
0
4
5		 6
0
9
3
4
7		 8
6
1
7
To
l
As
ta
ts
se		 9
5
4
5
3
2		 9
4
7
3
0
5		 7
2
2
7
To
ta
l
Eq
i
ty
u		 3
8
8
7
8
6		 3
9
0
1
9
5		 (
)
1
4
0
9
Pr
is
ion
ov
s		 1
8
5
1
2		 1
8
4
8
7		 2
5
Lo
-te
in
te
t-
be
ing
de
b
t
ng
rm
re
s
ar		 2
9
6
9
0
3		 2
9
6
7
3
6		 1
6
7
To
ta
l
No
t
L
ia
b
i
l
i
t
ies
n-
cu
rre
n		 3
1
5
4
1
5		 3
1
5
2
2
3		 1
9
2
S
ho
t-
te
in
te
t-
be
ing
de
b
t
r
rm
re
s
ar		 - - -
O
he
l
ia
b
i
l
i
ies
t
t
t
r
cu
rre
n		 2
5
0
3
3
1		 2
4
1
8
8
7		 8
4
4
4
To
l
Cu
ia
b
i
l
i
ies
ta
t
L
t
rre
n		 2
5
0
3
3
1		 2
4
1
8
8
7		 8
4
4
4
To
ta
l
L
ia
b
i
l
i
t
ies		 5
6
5
7
4
6		 5
5
7
1
1
0		 8
6
3
6
To
ta
l
Eq
i
ty
d
L
ia
b
i
l
i
t
ies
u
a
n		 9
4
3
2
5
5		 9
4
3
0
7
5		 2
2
7
7
  • • Additional Liquidity reserves are NOK 420 million
  • • Net Interest-bearing debt increased by NOK 21 million (Q1 2014: 107 v Q2 2014: 128)
  • • Dividend of Nok 44 million paid in the quarter

CAPITAL STRUCTURE

Continued strong cash, equity and low net debt positions

www.hexagon.no

SEGMENT SHARES Q2 2014

BEFORE INTERCOMPANY ELIMINATIONS AND GROUP CHARGES*

Q2: HIGH-PRESSURE CYLINDERS

  • • Some temporary weakness in heavy duty demand in North America balanced by strong global bus market
  • • Global market for TITAN™ and SMARTSTORE™ transportation and storage systems on target
  • • Continued positive developments in European passenger car market
N
O
K
T
H
O
U
S
A
N
D		 S
C
S
U
M
M
A
R
Y
F
I
N
A
N
I
A
L
Q
2
2
0
1
4		 Q
2
2
0
1
3		 Va
ia
r
nc
e
O
t
ing
In
p
e
ra
c
o
m
e		 2
6
3
4
4
5		 2
1
2
8
6
3		 0
9
1
5
5
O
ing
t
p
e
ra
e
xp
e
ns
e
s		 (
)
2
0
8
0
2
1		 (
)
1
7
5
6
8
7		 (
)
3
2
3
3
4
E
B
I
T
D
A		 5
5
4
3
3		 3
7
1
7
6		 1
8
2
5
7
De
ia
t
io
d
im
irm
t
p
re
c
n
a
n
p
a
e
n		 (
7
7
5
8
)		 (
6
1
1
3
)		 (
1
6
4
5
)
E
B
I
T		 4
6
7
7
5		 3
1
0
6
3		 1
6
6
1
2

Q2: LOW-PRESSURE LPG CONTAINERS

  • •Strong sales, especially in Europe
  • • Continued geographical expansion into new markets in and outside Europe
  • •Margins negatively impacted by non-standard production runs
  • •Russia/Ukraine conflict not impacting results materially
  • • Production balanced to cater for Middle Eastern orders for rest of year; Assumes no interruptions to Iraq order
N
O
K
T
H
O
U
S
A
N
D		 S
U
M
M
A
R
Y
F
I
N
A
N
C
I
A
L
S
Q
2
2
0
1
4		 Q
2
2
0
1
3		 Va
ia
r
nc
e
O
t
ing
In
p
e
ra
c
o
m
e		 1
3
2
8
0
6		 1
1
2
0
4
5		 2
0
7
6
1
O
t
ing
p
e
ra
e
xp
e
ns
e
s		 (
1
0
1
0
9
4
)		 (
9
9
2
4
)
7		 (
2
1
1
0
)
7
E
B
I
T
D
A		 3
1
7
1
2		 3
2
1
2
1		 (
)
4
0
9
De
ia
t
io
d
im
irm
t
p
re
c
n
a
n
p
a
e
n		 (
9
2
7
3
)		 (
8
6
4
8
)		 (
6
2
5
)
E
B
I
T		 2
2
4
3
9		 2
3
4
7
3		 (
1
0
3
4
)

2QUARTER 2014 OUTLOOKND

www.hexagon.no

SOME CHALLENGES IN Q3 – Q4 LOOKING GOOD

  • •LPG on steady course to record year
  • • Temporary softening in US Heavy Duty Class 7-8 truck market Partnership with Agility beneficial
  • • Strong US and European bus market extending into new regions
  • • Gas Distribution Products looking strong, but some deliveries could slip into 2015

CAPACITY EXPANSION HEXAGON LINCOLN

  • • Expansion Phase I nearing completion
  • Challenges with curing installations have affected up-time
  • • Normal lead times have been restored
  • • Second TITANTM winder being commissioned in Q3
  • • Expansion Phase II is on-going with key equipment on order
  • • Capacity constraints not expected in the foreseeable future

MEDIUM AND LONG TERM OUTLOOK REMAINS STRONG

  • • Performance resting on several segments and geographies, all of which represent significant growth opportunities
  • • Organizational development and recruitments on-going
  • ̵Geographical expansion
  • New segments
  • ̵Broadening of services
  • Innovation

QUESTIONS PLEASE

Jon Erik Engeset, CEO

David Bandele, CFO

More from Hexagon Composites

Major Shareholding Notification 2026
May 27
Proxy Solicitation & Information Statement 2026
May 13
Proxy Solicitation & Information Statement 2026
May 13
Major Shareholding Notification 2026
May 8
Major Shareholding Notification 2026
May 8
Capital/Financing Update 2026
May 8
Capital/Financing Update 2026
May 7
Capital/Financing Update 2026
May 7
Regulatory Filings 2026
May 7
Interim / Quarterly Report 2026
May 7
View all filings →