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Aluflexpack AG Half year 2019 results 02 September 2019
Disclaimer
The information contained in this presentation is not for use within any country or jurisdiction or by any persons where such use would constitute a violation of law. If this applies to you, you are not
authorized to access or use any such information. The presentation may not be reproduced, published or transmitted, in whole or in part, directly or indirectly, to any person (whether within or outside
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The attached information is not an offer to sell or a solicitation of an offer to purchase any security in the United States or elsewhere and shall not constitute an offer, solicitation or sale any securities of
Aluflexpack AG (Aluflexpack, Group) in any state or jurisdiction in which, or to any person to whom such an offer, solicitation or sale would be unlawful nor shall it or any part of it form the basis of, or be
relied on in connection with, any contract or investment decision. No securities may be offered or sold within the United States or to U.S. persons absent registration or an applicable exemption from
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an offering circular within the meaning of article 652a of the Swiss Code of Obligations, nor is it a listing prospectus within the meaning of the listing rules of the SIX Swiss Exchange or a prospectus
under any other applicable laws.
This presentation may contain “forward-looking statements” that are based on our current expectations, assumptions, estimates and projections about us and our industry. Forward-looking statements
include, without limitation, any statement that may predict, forecast, indicate or imply future results, performance or achievements, and may contain the words “may”, “will”, “should”, “continue”, “believe”,
“anticipate”, “expect”, “estimate”, “intend”, “project”, “plan”, “will likely continue”, “will likely result”, or words or phrases with similar meaning. Undue reliance should not be placed on such statements
because, by their nature, forward-looking statements involve risks and uncertainties, including, without limitation, economic, competitive, governmental and technological factors outside of the control of
Aluflexpack AG (Aluflexpack, Group), that may cause Aluflexpack’s business, strategy or actual results to differ materially from the forward-looking statements (or from past results). Nothing contained in
this presentation is or should be relied upon as a promise or representation as to the future. It is up to the recipient of the presentation to make its own assessment as to the validity of such forward-
looking statements and assumptions.
The information contained in the presentation does not purport to be comprehensive. Aluflexpack undertakes no obligation to publicly update or revise any information contained herein or forward-
looking statements, whether to reflect new information, future events or circumstances or otherwise. It should further be noted, that past performance is not a guide to future performance. Please also
note that interim results are not necessarily indicative of the full-year results. Persons requiring advice should consult an independent adviser. Some financial information in this presentation has been
rounded and, as a result, the figures shown as totals in this presentation may vary slightly from the exact arithmetic aggregation of the figures that precede them. While we are making great efforts to
include accurate and up-to-date information, we make no representations or warranties, expressed or implied, and no reliance may be placed by any person as to the accuracy and completeness of the
information provided in this presentation and we disclaim any liability for the use of it. Neither Aluflexpack nor any of its directors, officers, employees, agents, affiliates or advisers is under an obligation
to update, correct or keep current the information contained in this presentation to which it relates or to provide the recipient of it with access to any additional information that may arise in connection
with it and any opinions expressed in this presentation are subject to change.
In this presentation, we utilise certain alternative performance measures, including EBITDA, adjusted EBITDA, adjusted Operating Profit, organic growth, Working Capital ratio, and others that in each
case are not recognized under International Financial Reporting Standards (“IFRS”). These non-IFRS measures are presented as we believe that they and similar measures are widely used in the
markets in which we operate as a means of evaluating a company’s operating performance and financing structure. They may not be comparable to other similarly titled measures of other companies
and are not measurements under IFRS or other generally accepted accounting principles, nor should they be considered as substitutes for the information contained in the financial statements included
in this presentation. For a particular definition of any of the mentioned and non-mentioned alternative performance indicators please see either notes in this presentation or definitions in our HY2019
interim financial statement.
By receiving this Presentation, you agree to be bound by the foregoing limitations. Any failure to comply with these restrictions may constitute a violation of applicable securities laws.
This Presentation does not constitute investment, legal, accounting, regulatory, taxation or other advice.
THIS PRESENTATION IS NOT AN INVITATION TO PURCHASE SECURITIES OF ALUFLEXPACK AG OR THE GROUP.
3
Executive summary
Half year 2019 results
H1 2019 net sales increased 18.9% to € 101.3m, organic net
Strong growth in net
sales growth reached 10.6% on the back of strong demand
sales
across all end markets
Increase in adjusted EBITDA by 25.5% to € 14.0m from € 11,1m
Further improvement
and in adjusted EBITDA margin from 13.1% to 13.8% underlines
of result
focus on sustainable growth
Capital expenditure of € 17.0m directed to our stand-up pouch
Investments in future business and to additional capacities for our coffee, pharma,
confectionery and dairy end markets
All machines have been cleaned, start-up of affected machines
Business as usual at initiated, no material interruption of deliveries occurred, damage
Eliopack expected to be completely covered by existing insurance
Net sales for the full year 2019 expected between € 200m and €
Guidance 210m. Full year adjusted EBITDA margin expected to be at a
level similar to H1 2019
4Financial Highlights
Growth of 18.9% in H1 2019, thereof 10.6% organic
Net sales Net sales – geographical split
(in €m) (H1 2019)
26% 28%
181.7
160.6
144.1 7%
7% 15%
101.3 8%
9%
85.2
France Germany
Switzerland and Liechtenstein Croatia
Netherlands Turkey
Other
2016 2017 2018 H1 2018 H1 2019
5Financial Highlights
Improvement of adj. EBITDA to € 14.0m, margin to 13.8%
Adj. EBITDA Adj. Operating Profit (EBIT)
(in €m / margin in % of net sales)(1) (in €m / margin in % of net sales)(2)
10.0% 11.3% 11.9% 13.1% 13.8% 2.3% 3.7% 4.4% 5.2% 6.4%
21.6
18.1
14.4 14.0
11.1
8.0
5.9 6.5
4.4
3.3
2016 2017 2018 H1 2018 H1 2019 2016 2017 2018 H1 2018 H1 2019
Drivers
• Economies of scale, cost positions growing slower than top line
• Efficiency improvements across organisation
• Improved product mix
Notes: PARTLY UNAUDITED AND SUBJECT TO CHANGE; (1) Adjustments in 2018 include to voluntary one-off bonuses to management paid by the majority shareholder in the amount of € 1,9m, adoption of a pension plan in the amount of € 0,8m
and gains on the sale & lease back transaction in the amount of € 2,7m; adjustments in H1 2018 include to voluntary one-off bonuses to management paid by the majority shareholder in the amount of € 1,9m; adjustments in H1 2019 include
transaction cost for the initial public offering in the amount of €2,6m, voluntary one-off bonus payment to management by the majority shareholder in the amount of € 8.0, expenses in relation to the fire incident in the amount of € 2,5m and income in
relation to the fire incident in the amount of € 3,3m. (2) In addition to the factors mentioned in (1), adjustments include acquisition related amortizations of € 1.6m in 2016, € 1,6m in 2017, € 1,6m in 2018 and € 0.8m in H1 2018, € 1.0m in H1 2019 and 6
impairments in relation to the fire incident in the amount of € 0.8m.Profit and Loss statement - overview
First six months 2019
(in T€) H1 2019 H1 2018 DELTA (%)
Comments
Net Sales 101,319 85,209 18.9
• Improvement in adj. EBITDA
Adjusted EBITDA(1) 13,979 11,138 25.5 margin to 13.8% on the back
of economies of scale,
Adjusted EBITDA margin 13.8% 13.1% efficiency gains and product
mix
Adjusted Operating Profit (EBIT)(1) 6,482 4,419 46.7
• Increase in adj. Operating
Adjusted Operating Profit margin 6.4% 5.2% Profit (EBIT) to € 6.5m
proves that investments into
Financial result -2,226 -1,470 platform pay off
Result before tax -7,284 270 • Financial result decreased to
-€ 2.2m in H1 2019 mainly
Result for the period -7,953 371 due to increased IC loans
o/w owners of the company -7,863 335 • Due to one-off items,
amongst others in relation to
o/w non-controlling interests -90 36 the listing on the stock
exchange, result for the
period decreased to -€ 8.0m
Notes: (1) A detailed reconciliation between reported and adjusted numbers can be viewed in the appendix of this presentation
7Cost management
Improvement in material costs and other operating costs margins
Material Costs Adj. Other operating costs
75.0% 33.0%
(in €m / in % of net sales)(1) (in €m / in % of net sales)(2)
200
200
28.0%
70.0% 150
150
65.4% 23.0%
64.5%
63.5% 63.1% 63.1% 65.0% 100
100
18.0%
117.3 60.0% 50 12.4% 12.6% 12.2% 12.4%
50 94.3 102.0
10.6% 13.0%
53.8 64.0
17.8 20.3 22.1 10.5 10.8
0 55.0% 0 8.0%
2016 2017 2018 H1 2018 H1 2019 2016 2017 2018 H1 2018 H1 2019
200 35.0%
Adj. Personnel Expenses Comments
(in €m / in % of net sales)(3)
•
30.0% In H1 2019, Material costs in % of net sales improved further reaching a
150 level well below the past three years based on efficiency gains, further
integration of our supply chain and product mix improvement
25.0%
100 • Other Operating costs in % of net sales decreased in H1 2019,
20.0% compared to H1 2018, due to e.g. a lower relative share of energy and
transportation costs
50 14.0%
13.1% 13.5% 13.3% 15.0%
12.7%
• Personnel expenses increased in % of net sales, in H1 2019, compared
18.4 21.0 24.5 11.3 14.2 to H1 2018, mainly due to the ramp-up at our Umag (Croatia) plant
0 10.0%
2016 2017 2018 H1 2018 H1 2019
Notes: (1) Material costs is defined as Cost of materials, supplies and services less temporary personnel, less income from disposal from recycling products, less income from insurance (incl. income from business interruption insurance of EUR 0.2m
in H1 2019), less income from claims and adjusted for changes in finished and unfinished goods; (2) Adjusted for costs for listing on the sock exchange; (3) Adjusted for temporary personnel costs and one-off bonus payments paid by the majority
shareholder 8Financial Position - overview
As of June 30, 2019
(in T€) 30 Jun 2019 31 Dec 2018
ASSETS Comments
Non-current assets 124,840 100,440
• Increase in non-current assets
o/w Property plant and equipment 93,690 68,508
due to investments into our
o/w Intangible assets and goodwill 29,797 30,585 platform and Umag expansion
o/w other non current assets 1,353 1,347
Current assets 236,267 96,510 • IPO proceeds are reflected in
Other receivables and assets at
o/w Inventories 47,871 49,390
the balance sheet date, as the
o/w Trade receivables 22,663 22,630 proceeds were only transferred
o/w Other receivables and assets 142,052 5,514 on 2 July 2019.
o/w Cash and cash equivalents 23,681 18,976
Total assets 361,107 196,949 • Equity ratio rose to 46.4%
• Net debt position of € 108.7m at
EQUITY AND LIABILITIES the balance sheet date,
Total equity 167,600 25,927 effective net cash position as of
Non-current liabilities 52,607 84,116 2 July 2019 with pay-out of IPO
proceeds
Current liabilities 140,889 86,906
Total equity and liabilities 361,107 196,949 • Decrease in working capital
9Working Capital management
Working Capital Ratio(1) (LTM) decreased to 16.9%
60.0 30.0%
Comments
50.0 25.0%
21.0%
40.0 20.0% • Despite increase in sales, inventories decreased by € 1.5m from
16.1% 16.9%
31 December 2018 to 30 June 2019
14.3%
30.0 15.0%
• Trade receivables remained on a stable level despite an
20.0 10.0% increase in sales
38.1
33.4
10.0 23.2 23.0 5.0% • Increase in Operative Payables by € 3.4m driving improvement
in Working Capital Ratio
0.0 0.0%
2016 2017 2018 H1 2019
Notes: (1) Working Capital is calculated as the sum of total inventories and trade receivables less total operative payables. Working Capital ratio is calculated by dividing end of period working capital through the sales of the last 12 months.
10Cashflow statement - overview
First six months 2019
(in T€) H1 2019 H1 2018
Comments
• Increase in cash and cash
Cash and cash equivalents at the beginning of the period 18,976 3,778 equivalents due to capital
increase before listing
Net cash provided / used in operating activities 8,309 1,032
• IPO proceeds were
transferred after the balance
Net cash used in investing activities -16,989 -11,419
sheet date on 2 July 2019
Net cash used in / from financing activities 13.090 10,137
• Operating cash flow
improved significantly yoy
+/- effect of exchange rate fluctuations on cash held 297 14 and was negatively impacted
by € 2.2m due to FX
Cash and cash equivalents at the end of the period 23,681 3,542 valuation of the deferred
receivable Aluflexpack
booked for recognizing the
IPO proceeds at the balance
sheet date
• Investments of €17.0m
mainly into Umag expansion
11Capital allocation in H1 2019
€ 17.0m invested into future
Finalization of expansion of stand-up pouch
manufacturing capacities
Capex H1 2019 Additional capacities for Pharma and Coffee/tea, as
€ 17m well as Dairy and Confectionery end markets
Efficiency and product quality improvements
12Construction of Umag well advancing
Over € 20m already invested in infrastructure and new machinery
Rotogravure printing Slitter/ Rewinder/ Pouch-Making/ Spout/
1 & laminating machine 2 Laser 3 Thomson Die/ Zip 4 Infrastructure Umag
installed installed installed Well on track
• • One pouch making machine and • Construction of main production
Rotogravure printing machine up • Rewinder and laser are up and
and running since end of July 2019. one spout machine installed and building almost finished
running
Several products already tested and running
• Slitter will be installed in October • Recuperation will be connected until
produced successfully • Additional pouch machine and middle of September
• Laminator also up and running since Thomson Die/ Zip will be installed in
September with start of production • Expansion incl. Relocation of
mid August 2019 – acceptance tests
machines and warehouse, planned
ongoing, bigger production start in • Theoretical installed capacity of mainly to be finished in Q3 and
September 500m pcs by September partly in Q4
“1bn Pouches” expansion
• Installed capacity: 500m stand-up pouches p.a. by September 20191
• Targeted end markets: Pet food, baby food, liquids etc.
• Production for selected blue chip customers
• Increased demand for high value-added products at industrial scale
• Potential features: zippers, spouts, special formats, etc.
Notes: (1) Stated capacity is referring to 100g standard format
13Eliopack update
As reported previously, a fire occurred at the manufacturing facility of Aluflexpack’s subsidiary
Eliopack in the industrial zone of Ajeux in La Ferté-Bernard, France, on 24 June 2019
Production areas not affected by fire have been fully operational within one week. Other machines
started production within three weeks; electrical infrastructure completely reinstalled; cleaning and
decontamination process of remaining machines completed by end August. The start-up of the
affected machines has been initiated and the fine-tuning is ongoing
Close cooperation with customers, effective contingency plans and alternative production routes
assured no significant interruption of deliveries
Based on current facts, management expects all costs related to the incident to be covered by
existing insurance policies
As of 30 June, 2019, € 2.5m in depreciation on inventories and € 0.8m impairments on technical
equipment and machinery recognized, as well as insurance income of € 3.5m1
Notes: Amount of € 3.5m includes income from business interruption of €0.2m for H1 2019.
14Strategic positioning
Focus on proven cornerstones in Aluflexpack’s business model
Development & Focus on Deep integration Leverage on
manufacturing of fast growing of the economies of
high value adding end markets value chain scale/operating
products leverage
Developments H1
- Expansion in SUP Strengthen position Leverage existing Decrease of other
business in coffee/tea, pet lacquering, operating costs in
- Further develop- food and pharma extrusion, % of net sales
ment of coffee end markets lamination and achieved, e.g.
capsules and blister printing capacities energy and
foil business transportation costs
Source(s): Company information
15Major building blocks for accelerated growth
Capacity
Stand-up
expansion & Value accretive
pouch business
efficiency acquisitions
improvements
Organic growth Bolt-on M&A
16Outlook for full year 2019
• Positive momentum expected to continue in H2 2019
• Based on healthy end market demand and a gradual ramp-up of our SUP capacities, full
year net sales are expected to be in a corridor of € 200m to € 210m
• In addition, the full year adjusted EBITDA margin (in %) is expected to be at a similar level
to the one reached in H1 2019
17Appendix
Overview over earnings adjustments
ADJUSTMENTS ON EBITDA LEVEL (in T€) H1 2019 H1 2018
EBITDA - IFRS reported 4,199 9,226
Transaction costs of the initial public offering 2,596 0
Extraordinary personnel expenses1 7,987 1,911
Expenses in relation to fire incident2 2,505 0
Income in relation to fire incident3 -3,308 0
EBITDA - adjusted 13,979 11,138
ADJUSTMENTS ON EBIT LEVEL (in T€) H1 2019 H1 2018
Operating Profit (EBIT) - IFRS reported -5,058 1,740
Transaction costs of the initial public offering 2,596 0
Extraordinary personnel expenses 7,987 1,911
Expenses in relation to fire incident 2,505 0
Income in relation to fire incident -3,308 0
Impairment in relation to fire incident4 803 0
Acquisition related amortizations 957 768
Operating Profit (EBIT) - adjusted 6,482 4,419
Notes: (1) Voluntary one-off bonus payment to management by majority shareholder; (2) Expenses refer to potential write off of stock in relation to the fire incident that occurred at Eliopack on 24 June 2019; (2) Income refers to expected reimbursements for
stock write off and tangible book value write off in relation to the fire incident that occurred at Eliopack on 24 June 2019 and exclude gains from business interruption insurance in the amount of EUR 0.2 million; (3) Impairments were made to technical
equipment in relation to the fire incident that occurred at Eliopack on 24 June 2019; 19Income statement
(in T€) H1 2019 H1 2018
Gross Sales 102 729 86 384
Sales deductions -1 410 -1 175
Net Sales 101 319 85 209
Change in finished and unfinished goods 387 3 897
Other operating income 7 463 4 106
Cost of materials, supplies and services -69 890 -60 379
Personnel expenses -21 729 -13 065
Other operating expenses -13 351 -10 542
EBITDA 4 199 9 226
Depreciation and amortisation -9 257 -7 486
Operating Profit -5 058 1 740
Interest income 25 1
Interest expenses -2 481 -1 821
Other financial income 939 1 401
Other financial expenses -709 -1 051
Financial result -2 226 -1 470
Result before tax -7 284 270
Tax expense/benefit -669 101
Result for the period -7 953 371
Thereof attributable to:
Owners of the company -7 863 335
Non controlling interests -90 36
Result for the period -7 953 371
20Balance Sheet – Assets
(in T€) 30 Jun 2019 31 Dec 2018
ASSETS
Intangible assets and goodwill 29 797 30 585
Property, plant and equipment 93 690 68 508
Other receivables and assets 114 114
Deferred tax assets 1 239 1 233
Non-current assets 124 840 100 440
Inventories 47 871 49 390
Trade receivables 22 663 22 630
Other receivables and assets 142 052 5 514
Cash and cash equivalents 23 681 18 976
Current assets 236 267 96 510
TOTAL ASSETS 361 107 196 949
21Balance Sheet – Equity and Liabilities
(in T€) 30 Jun 2019 31 Dec 2018
Capital stock 15 553 86
Capital reserves 136 426 1 958
Retained earnings 14 828 23 000
Equity attributable to owners of the Company 166 806 25 044
Non controlling interests 793 883
Total equity 167 600 25 927
Loans from affiliated companies 0 43 979
Bank loans and borrowings 26 164 23 527
Other financial liabilities 20 631 9 934
Deferred tax liabilities 4 136 4 343
Employee benefits 1 443 1 383
Other liabilities 233 950
Non-current liabilities 52 607 84 116
Bank loans and borrowings 16 726 17 581
Loans from affiliated companies 65 784 23 776
Other financial liabilities 3 065 923
Current tax liabilities 849 978
Provisions 2 162 23
Employee benefits 1 292 978
Trade payables and advances received from customers 37 150 33 695
Accruals 8 239 2 316
Other liabilities 5 632 6 636
Current liabilities 140 899 86 906
TOTAL LIABILITIES 193 506 171 022
TOTAL EQUITY AND LIABILITIES 361 107 196 949
22Cash flow statement
(in T€) H1 2019 H1 2018
Income/Loss before tax -7 284 270
+/- Financial results excluding other financial income/expense 2 456 1 820
+/- Other non-cash expenses and income 7 192 1 417
+ Depreciation and amortisation 9 257 7 486
-/+ Gains and losses from disposals of PPE and intangible assets 0 -2
-/+ increase and decrease in inventories 1 705 -4 023
-/+ Increase and decrease in current trade receivables 79 -2 096
-/+ Increase and decrease in other assets -5 040 258
+/- Increase and decrease in trade payables 631 -3 789
+/- Increase and decrease in accruals 1 864 666
+/- Increase and decrease in other payables -1 750 -969
+/- Increase and decrease in provisions 203 74
+/- Increase and decrease in liablities for employee benefits 13 0
-/+ Income taxes paid -1 017 -81
Net cash provided / used in operating activities 8 309 1 032
+ Payments received for disposals of PPE and intangible assets 0 7
- Payments made for purchases of PPE and intangible assets -17 015 -11 431
+ Interest received 25 1
+/- Other payments received/made for investing activities 0 4
Net cash used in investing activities -16 989 -11 419
+ Proceeds from the issue of ordinary shares 16 564 0
- Payments of lease liabilities (2018: Payments of financial lease liabilities) -1 752 -429
+ Issuances of financial liabilities (3rd parties) 5 255 519
+ Issuances of financial liabilities (MTC group companies) 0 14 628
- Repayments of financial liabilities (3rd parties) -3 655 -3 634
- Repayments of financial liabilities (MTC group companies) -2 290 -23
- Interest paid -1 032 -925
Net cash used in / from financing activities 13 090 10 137
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