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14 February 07, page 1 Company Confidential Results 4Q06 and FY06 Martin De Prycker, CEO 14 February 2007.

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Presentation on theme: "14 February 07, page 1 Company Confidential Results 4Q06 and FY06 Martin De Prycker, CEO 14 February 2007."— Presentation transcript:

1 14 February 07, page 1 Company Confidential Results 4Q06 and FY06 Martin De Prycker, CEO 14 February 2007

2 14 February 07, page 2 Company Confidential Operational results 4Q 2006 and full year 2006 in € million4Q 200520054Q 20062006 Growth 4Q 06 / 4Q 05 Growth 06 / 05 Orders196.5730.4195.9817.7-0.3%12.0% Sales210.0712.0222.5750.86.0%*5.4% EBIT19.152.026.860.740.6%16.7% EBIT %9.17.312.08.1 Book-to-bill0.941.030.881.09 * 4Q06/4Q05 sales growth 9.5% at equal currency

3 14 February 07, page 3 Company Confidential Results 4Q 2006

4 14 February 07, page 4 Company Confidential Results per quarter Results per quarter in € million

5 14 February 07, page 5 Company Confidential Overall comments 4Q 2006  Continued high order input in most of our activities  Strong sales growth of 6.0% vs 4Q05 (9.5% at constant currencies), with –Growth in BarcoView and Control Rooms –Decline in Media & Entertainment  Book-to-bill at 0.88, due to strong sales  Gross profit margin at 41.5% stable vs 41.4%  EBIT negatively impacted with € 4.5 million, due to replacement of a new product introduced in Media & Entertainment  EBIT at € 26.8 million, 40.6% better than 4Q05

6 14 February 07, page 6 Company Confidential Evolution of results per division in € million 4Q054Q06 Sales% EBITSales% EBIT View69.913.578.712.9 Media & Entertainment61.656.8-5.8 Control Rooms34.217.242.524.9 Presentation & Simulation30.811.932.916.2 Vision13.010.913.418.8 Manufacturing Services21.6-3.326.15.7 Eliminations-21.0-27.8 Total210.09.1222.512.0

7 14 February 07, page 7 Company Confidential BarcoView (1) in € million

8 14 February 07, page 8 Company Confidential BarcoView (2)  Orders –Book-to-bill ratio at 0.98 –Orders growing with 53.1% vs 4Q05 in medical with a very successful RSNA show in Chicago, in defense with further confirmation of order improvement and in avionics. Traffic Management remains weak  Sales –Sales growth of 13% –Strong sales growth in medical confirms our market leadership –Defense sales flat vs 4Q05 –Avionics sales slightly higher than 4Q05 –Traffic Management strongly declining, with stable high market share  Margins –Gross profit margin at 44.7% vs 51.8%, much lower than last year, due to volume and price decline in traffic management display –Good profit margin stable at 12.9% vs 13.5% in 4Q05  Impairment of € 10.4 million on Voxar acquisition (2004) –Slower market acceptance of 3D software, resulting in lower sales than anticipated

9 14 February 07, page 9 Company Confidential Barco Media & Entertainment (1) in € million

10 14 February 07, page 10 Company Confidential Barco Media & Entertainment (2)  Orders –Book-to-bill ratio at 0.77 –Orders 38% lower than 4Q05  Media orders much lower than 4Q05  Lower orders in Events, yet strongly above quarterly average of 2006  Orders in Digital Cinema slightly lower than 4Q05, but the outlook for DC in 2007 looks better  Sales –Sales 8% lower vs 4Q05  Events sales lower vs 4Q05  Strong sales growth in media  DC sales lower than last year, mainly because of slower than anticipated roll out outside US  Margins –Gross profit margin at 23.9% vs 22.8 %, better than last year –Profit margin weak at -5.8%, due to a provision of € 4.5 million for the replacement of a new product in media. Operational profit margin (excluding exceptional provision) at +2.1 %

11 14 February 07, page 11 Company Confidential Barco Control Rooms (1) in € million

12 14 February 07, page 12 Company Confidential Barco Control Rooms (2)  Orders –Book-to-bill at 0.76, lower than 4Q05, mainly because of extremely high sales volume –Orders flat vs 4Q05  Sales –Sales in all market segments strongly growing vs 4Q05 supported by a streamlined supply chain  Margins –Gross profit margin decreased to 46.2% vs 48.3 % in 4Q05, due to some large projects with lower margin –Very good profit margin at 24.9% vs 17.2% in 4Q05, thanks to very high sales volume

13 14 February 07, page 13 Company Confidential Barco Presentation & Simulation (1) in € million

14 14 February 07, page 14 Company Confidential Barco Presentation & Simulation (2)  Orders –Book-to-bill at 0.96 –Orders declined slightly vs 4Q05, both in Corporate AV and Simulation –Important reference order for the new LCOS projector received from CAE for their future simulator family  Sales –Sales increased vs 4Q05, both in Corporate AV and Simulation –Simulation strongly recovered in US after a weaker first year half –Corporate AV market remains extremely strong in China  Margins –Gross profit margin at 43.9 % vs 39.9% in 4Q05 –Very good profit margin at 16.2%, higher than 11.9% in 4Q05

15 14 February 07, page 15 Company Confidential BarcoVision (1) in € million

16 14 February 07, page 16 Company Confidential BarcoVision (2)  Sales & Orders –Book-to-bill ratio at 1.02 –Orders and sales in textile slightly better than in 4Q05  Margins –Gross profit margin stable at 50.9% vs 50.6% in 4Q05 –Profit margin much better at 18.8% vs 10.9% in 4Q05  Divestment process started

17 14 February 07, page 17 Company Confidential Barco Manufacturing Services (1) in € million

18 14 February 07, page 18 Company Confidential Barco Manufacturing Services (2)  Sales & Orders –Sales and orders much stronger than 4Q05, thanks to large internal orders from all Barco divisions for delivery in 4Q06 and 1Q07  Margins –EBIT margin much better at 5.7% vs -3.3 % in 4Q05, thanks to lower cost and high volume –Sale of Electronic Manufacturing Services to IPTE and Prints to Elprinta finalized and signed –Discussions with partners for Mechanical business unit are ongoing –Negative impact of sale to IPTE and Elprinta: € 1.4 million non-operating result before taxes

19 14 February 07, page 19 Company Confidential Geographical breakdown of sales EMEA AMERICAS ASIAPAC. 4Q06 4Q05

20 14 February 07, page 20 Company Confidential Key figures Income Statement 4Q06 in € million4Q05%4Q06% Sales Cost of goods sold 210.0 -123.1 100.0 -58.6 222.5 -130.1 100.0 -58.5 Gross Profit Research & Development Sales & Marketing General & Administration Other operating result 86.9 -18.8 -30.6 -13.0 -5.4 41.4 -9.0 -14.6 -6.2 -2.6 92.4 -16.7 -31.4 -14.7 -2.9 41.5 -7.5 -14.1 -6.6 -1.3 EBIT Goodwill 19.1 -4.0 9.1 -1.9 26.8 -11.5 12.0 -5.2 Operating Result15.17.215.36.9 Non-operating result1.80.9-1.8-0.8 Income Taxes-3.3-1.6-5.4-2.4 Net Income13.76.58.13.6 Current Cash Flow31.214.934.215.4 Current Earnings per Share (in €)1.221.70 Net Earnings per Share (in €)1.120.67

21 14 February 07, page 21 Company Confidential Results Full Year 2006

22 14 February 07, page 22 Company Confidential Operational results full year 2006 in € million20052006Growth 06/05 Orders730.4817.712.0% Sales712.0750.85.4% EBIT52.060.716.7% EBIT %7.38.1 Book-to-bill1.031.09

23 14 February 07, page 23 Company Confidential Headlines 2006  Strong growth in sales (5.4%), orders (12.0%) and profit (16.7%), thanks to our focused approach on growth markets, mainly in –Medical Imaging –Control Rooms –Events  Keeping our gross margin stable at 41.3% with a larger product portfolio  Improving our profit margin to 8.1% in 2006 vs 7.3% in 2005  Investing in growth markets –Digital Cinema –Media –Avionics –Simulation

24 14 February 07, page 24 Company Confidential Evolution of results per division in € million 20052006 Sales% EBITSales% EBITSales Growth 06/05 View236.010.5%248.29.0%5.2% Media & Entertainment188.3-0.2%216.81.2%15.1% Control Rooms117.413.1%126.612.9%7.8% Presentation & Simulation103.26.8%111.78.4%8.2% Vision57.814.0%55.511.3%-4.0% Manufacturing Services93.4-3.2%86.44.4%-7.5% Total712.07.3%750.88.1%5.4%

25 14 February 07, page 25 Company Confidential BarcoView 2006  Orders –Strong growth in orders (27%) vs 2005 with book-to-bill ratio of 1.16 –Strongly growing orders in medical and avionics vs 2005, building up an order book for 2007 and beyond –Defense orders picking up again after a weak 2005 with a growth of 18% –Traffic Management orders declining in 2006 vs 2005, with major LCD upgrade projects being postponed  Sales –Growth in sales of 5% –Strong growth in medical, both in PACS and modality, but flat in 3D software –Defense sales slightly declining (3%) vs 2005 –Avionics continued to grow as a result of the strong order book built over the last years –Traffic Management sales strongly declining, but keeping our market share in a slow market  Margins –Gross profit margin declining from 47.1% to 44.4% due to a different product mix and price erosion in traffic management displays –EBIT margin declined from 10% to 9% due to a lower gross profit margin. Growth in sales volume faster than growth in indirect cost, partially compensating this lower gross profit margin  Impairment of € 12.0 million on Voxar acquisition –Slower market acceptance of 3D software, resulting in lower sales than anticipated

26 14 February 07, page 26 Company Confidential Barco Media & Entertainment 2006  Orders –Orders growing with 17% vs 2005, with a book-to-bill ratio of 1.12 –Orders in Events growing vs 2005, in line with the positive trend in the market –Orders in Media flat, including a large order in Dubai –Orders in Digital Cinema strongly growing, as the Digital Cinema market expanded  Sales –Sales growing with 15% vs 2005 –Sales in Events strongly growing with 13% –Media sales flat vs last year –Digital Cinema sales growing with 25%, but not as fast as orders, as the roll out is not yet running at full speed  Margins –Gross profit margin slightly improved to 29.4% vs 28.6% in 2005 –Growth in sales and growth of absolute gross profit resulted in a moderate profit growth, because of exceptional items related to new product warranty issues. Actions have been taken to avoid these issues in the future –EBIT margin switched from slightly negative to slightly positive

27 14 February 07, page 27 Company Confidential Barco Control Rooms 2006  Orders –Orders growing at a moderate pace of 3% with a book-to-bill ratio of 1.0  Sales –Sales growing 8% vs 2005, in all segments of the market, with some supply chain issues in 1Q06, but completely solved afterwards  Margins –Gross profit margin declining from 45.3% to 43.2%, mainly because of end of life of a product and the resulting inventory write down –EBIT margin stable at 12.9%

28 14 February 07, page 28 Company Confidential Barco Presentation & Simulation 2006  Orders –Orders slightly growing with 1% vs 2005, with a book-to-bill of 1.02 –Orders in Corporate AV growing vs last year and declining in Simulation, but Simulation recovering from a weaker first half. Positive market reaction to new LCOS projectors built foundation for future growth  Sales –Overall sales growing at 8% vs 2005 –Corporate AV market growing with 16%, thanks to growing market share, as new products are positively accepted in the market –Simulation slightly down, recuperating from a weaker first half  Margins –Gross profit margin stable at 41.9% –EBIT margin improving to 8.4% vs 6.8%, thanks to increased volume

29 14 February 07, page 29 Company Confidential BarcoVision 2006  Orders –Increasing with 4% vs 2005, with a shift from open end to ring spinning sensors –Book-to-bill at 1.04  Sales –Declining moderately (4%) vs 2005, with the same product shift as for the orders  Margins –Gross profit margin remaining stable at 47.6% vs 47.2% in 2005 –EBIT margin lower at 11.3% vs 14.0% last year, which was positively influenced by a one time sale of buildings

30 14 February 07, page 30 Company Confidential Barco Manufacturing Services 2006  Orders –Strongly growing orders, as internal demand for new products is picking up, especially in the second half of the year –Book-to-bill at 1.21  Sales –Sales declining, especially in the first half, but recovering in the second half  Margins –EBIT margin strongly improving vs 2005, thanks to a strong cost reduction program and restructuring done in 2005  Divestment of 2 of the 3 business units finalized; for the third business unit, discussions with interested partners are ongoing  Negative impact of sale to IPTE and Elprinta (€ 1.4 million non-operating result before taxes)

31 14 February 07, page 31 Company Confidential Key figures Income Statement 2006 in € millionFY 05%FY 06% Sales Cost of goods sold 712.0 -419.8 100.0 -59.0 750.8 -440.4 100.0 -58.7 Gross Profit Research & Development Sales & Marketing General & Administration Other operating result 292.2 -67.7 -114.8 -52.7 -4.9 41.0 -9.5 -16.1 -7.4 -0.7 310.4 -69.2 -120.3 -55.3 -4.9 41.3 -9.2 -16.0 -7.4 -0.7 EBIT Goodwill Impairment 52.0 -4.0 7.3 -0.6 60.7 -13.1 8.1 -1.7 Operating Result48.06.747.66.3 Non-operating result0.90.1-2.4-0.3 Income Taxes-10.3-1.5-11.8-1.6 Net Income38.65.433.34.4 Current Cash Flow98.013.8104.213.9 Current Earnings per Share (in €)3.253.91 Net Earnings per Share (in €)3.152.76

32 14 February 07, page 32 Company Confidential Key figures Balance Sheet in € million 31/12/0530/06/0631/12/06 Accounts Receivable188.8175.2218.6 Inventory141.4167.0146.7 Cash106.383.481.4 Financial debt84.381.393.8

33 14 February 07, page 33 Company Confidential Geographical breakdown of sales EMEA AMERICAS ASIAPAC. 2006 2005

34 14 February 07, page 34 Company Confidential Expectations 2007

35 14 February 07, page 35 Company Confidential Outlook 2007  Focus our company on growth markets with –Main segments where significant organic growth is expected  Medical  Control Rooms  Events  Digital Cinema –Further growth in NA and APAC expected  Comparable sales growing stronger organically than in 2006, but not yet double digit  Increase profitability through higher operational efficiency  Finalize our focusing exercise on selected professional markets by divesting BarcoVision and the remaining part of Manufacturing Services

36 14 February 07, page 36 Company Confidential Dividend Proposal of the Board of Directors to the annual shareholders’ meeting on April 26, 2007 Dividend will be increased to € 2.30 vs € 2.15 last year, resulting in  Pay out ratio of over 80%  Gross dividend yield around 3.4%

37 14 February 07, page 37 Company Confidential Questions & Answers


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