WÜRTH GROUP DIRECT SELLING IN THE DIGITAL WORLD COMPANY PRESENTATION Joachim Kaltmaier, CFO & Member of the Central Managing Board LBBW International Fixed Income Conference Stuttgart, 29 September 2015
2 WÜRTH GROUP - DIRECT SELLING IN THE DIGITAL WORLD Würth Group, 09/29/2015
AGENDA 1 2 3 4 Würth Group Business Overview Investment Financial Overview Merits Top Action Points in 2015 Direct Selling in the Digital World Potential Capital Market Offering Activities Overview 3 WÜRTH GROUP - DIRECT SELLING IN THE DIGITAL WORLD Würth Group, 09/29/2015
WÜRTH AT A GLANCE World market leader in the trade with assembly and connecting materials Family business More than 67,000 employees worldwide Annual sales 2014: EUR 10,126 bn. Operating Result 2014: EUR 515 million 4 WÜRTH GROUP - DIRECT SELLING IN THE DIGITAL WORLD Würth Group, 09/29/2015
SALES DEVELOPMENT WÜRTH GROUP 1954 2014, IN MILLION EUR 10'000 7'500 CAGR: 21.6 % (Compound Annual Growth Rate) 10,126 5'000 2'500 0 54 56 58 60 62 64 66 68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 5 WÜRTH GROUP - DIRECT SELLING IN THE DIGITAL WORLD Würth Group, 09/29/2015
STRATEGIC BUSINESS UNITS SALES IN %, 2014 Production 6.9 % reca Group 4.8 % Electronics 5.4 % Financial Services 1.1 % Others 1.1 % Würth Line 55.7 % Electrical Wholesale 9.9 % Trade 9.2 % Tools 3.6 % Screws & Standard Parts 2.3 % 6 WÜRTH GROUP - DIRECT SELLING IN THE DIGITAL WORLD Würth Group, 09/29/2015
STRATEGY & KEY SUCCESS FACTORS Sales Internationalisation Decentralized structure Quality Brand 7 WÜRTH GROUP - DIRECT SELLING IN THE DIGITAL WORLD Würth Group, 09/29/2015
AGENDA 1 2 3 4 Würth Group Business Overview Investment Financial Overview Merits Top Action Points in 2015 Direct Selling in the Digital World Potential Capital Market Offering Activities Overview 8 WÜRTH GROUP - DIRECT SELLING IN THE DIGITAL WORLD Würth Group, 09/29/2015
OVERVIEW SITUATION WÜRTH GROUP YTD DECEMBER Sales in mio. EUR Employees Operating Result in mio. EUR +3.9 % +3.9 % +15.7 % +4.8 %* 9'745 10'126 63'571 66'044 445 515 2013 2014 2013 2014 2013 2014 + 375 mio. EUR + 2,473 MA + 70 mio. EUR * currency adjusted 9 WÜRTH GROUP - DIRECT SELLING IN THE DIGITAL WORLD Würth Group, 09/29/2015
REGIONAL SALES DEVELOPMENT YTD DECEMBER 2014 /2013, IN MIO. EUR +4.2 % 4'403 4'590 +1.3 % 747 757 +4.1 % Germany +1.8 % 1'650 1'679 Scandinavia +5.5 % 460 479 Eastern Europe 916 966 2013 +5,5 % 1'130 1'192 Western Europe Southern Europe +5,5 % 439 463 2014 Asia, Africa, Oceania America 10 WÜRTH GROUP - DIRECT SELLING IN THE DIGITAL WORLD Würth Group, 09/29/2015
EBIT WÜRTH GROUP IN MIO. EUR AND IN %, YTD DECEMBER 800 EBIT EBIT in % 10.0 700 679 9.0 600 500 400 300 549 7.1 8.0 575 6.5 267 398 450 448 4.6 4.6 4.5 495 5.1 554 5.5 8.0 7.0 6.0 5.0 4.0 200 3.5 3.0 2.0 100 1.0 0 06 07 08 09 10 11 12 13 14 0.0 11 WÜRTH GROUP - DIRECT SELLING IN THE DIGITAL WORLD Würth Group, 09/29/2015
OPERATING CASHFLOW WÜRTH GROUP DEVELOPMENT 2005-2014 800 455 411 506 434 540 618 599 612 216 05 06 07 08 09 10 11 12 13 14 12 WÜRTH GROUP - DIRECT SELLING IN THE DIGITAL WORLD Würth Group, 09/29/2015
BALANCE SHEET STRUCTURE WÜRTH GROUP AS OF DECEMBER Assets Liabilities & Equity 7.978 8.142 7.978 8.142 Non-current Assets 3.573 3.651 3.399 (42,6%) 3.683 (45,2%) Equity capital Current Assets 4.406 4.491 2.150 1.978 2.430 2.480 Long-term Liabilities Short-term Liabilities 2013 2014 2013 2014 13 WÜRTH GROUP - DIRECT SELLING IN THE DIGITAL WORLD Würth Group, 09/29/2015
AVERAGE DIVIDEND PAY OUT RATIO 2004-2014 IN % 100% 90% 93.30% 80% 70% 60% 50% 40% 30% 28.33% 42.74% 44.91% 46.40% 48.50% 52.53% 20% 10% 0% 15.00% Würth Group BMW Allianz Daimler Siemens BASF Bayer Otto * * For Otto Group only the years 2007-2013 14 WÜRTH GROUP - DIRECT SELLING IN THE DIGITAL WORLD Würth Group, 09/29/2015
SELECTED FINANCIAL FIGURES WÜRTH GROUP (IN MILLION EUR) & RATIOS 2010 2011 2012 2013 2014 Sales Mio. EUR 8,633 9,699 9,985 9,745 10,126 Gross profit margin % 53% 53% 51% 52% 52% EBIT Mio. EUR 398 450 448 495 554 EBITDA Mio. EUR 690 736 762 798 831 EBITDA margin % 8.0% 7.6% 7.6% 8.2% 8.2% Equity Mio. EUR 2,867 3,042 3,204 3,399 3,683 Capex Mio. EUR 283 455 465 433 367 Net debt / EBITDA Multiple 1.5x 1.4x 1.3x 1.3x 1.3x Collection Days Days 52d 52d 52d 53d 52d Stock Turnover Multiple 5.8x 5.3x 5.3x 5.2x 5.1x Fluctuation (employees) % 15% 15% 16% 15% 14% 15 WÜRTH GROUP - DIRECT SELLING IN THE DIGITAL WORLD Würth Group, 09/29/2015
CREDIT RATING GUIDELINE FOR STRATEGY & COMPANY MANAGEMENT SINCE 2000: S&P RATING A outlook stable 16 WÜRTH GROUP - DIRECT SELLING IN THE DIGITAL WORLD Würth Group, 09/29/2015
AGENDA 1 2 3 4 Würth Group Business Overview Investment Financial Overview Merits Top Action Points in 2015 Direct Selling in the Digital World Potential Capital Market Offering Activities Overview 17 WÜRTH GROUP - DIRECT SELLING IN THE DIGITAL WORLD Würth Group, 09/29/2015
OVERVIEW SITUATION WÜRTH GROUP YTD JUNE Sales in mio. EUR Employees Operating Result in mio. EUR +8.7 % +3.9 % unchanged +5.5 %* 64'891 67'779 235 235 5'020 5'459 2014 2015 2014 2015 2014 2015 + 375 mio. EUR + 2,888 MA unchanged * currency adjusted 18 WÜRTH GROUP - DIRECT SELLING IN THE DIGITAL WORLD Würth Group, 09/29/2015
WHAT IS RUNNING WELL IN 2015? DEVELOPMENT IN ITALY DEVELOPMENT IN SPAIN DEVELOPMENT IN USA STANDARDIZATION OF IT EXPANSION OF CUSTOMER BASE E-COMMERCE ACTIVITIES ENGAGE MORE SALES PERSONS 19 WÜRTH GROUP - DIRECT SELLING IN THE DIGITAL WORLD Würth Group, 09/29/2015
WÜRTH GROUP TOP ACTION FIELDS 2015 5 Customer Growth 6 Products, Solutions and Services, offering Added-Value to Customers TOP ACTION FIELDS 1 Further Build-Up of Sales Force Globally 2 Strengthen Multi-Channel- Distribution E-Commerce Branch Office Network 4 Continued Diversifaction as Stabilising Factor Acquisitions Industry Electronics Regional & strat. Realignment 3 20 WÜRTH GROUP - DIRECT SELLING IN THE DIGITAL WORLD Würth Group, 09/29/2015
E-COMMERCE COMPETITION THE FIGHT FOR MARKET SHARE IS IN FULL SWING AND RIGHT IN THE MIDDLE OF IT 21 WÜRTH GROUP - DIRECT SELLING IN THE DIGITAL WORLD Würth Group, 09/29/2015
2. STRENGTHEN THE MULTI-CHANNEL DISTRIBUTION: TO INCREASE MARKET SHARE Customer type Potential utilization in % Only branch offices 9 5x Only sales representative 9 Branch offices & sales representative 34 Branch office, sales representative & system 52 22 WÜRTH GROUP - DIRECT SELLING IN THE DIGITAL WORLD Würth Group, 09/29/2015
2. STRENGTHEN THE MULTI-CHANNEL DISTRIBUTION: WITH AN ENLARGED BRANCH OFFICE NETWORK 1.600 Branch Offices in 50 Countries Plan 12.2015: +50 Branch Offices 23 WÜRTH GROUP - DIRECT SELLING IN THE DIGITAL WORLD Würth Group, 09/29/2015
2. STRENGTHEN THE MULTI-CHANNEL DISTRIBUTION: WITH E-COMMERCE DE-Würth 2014: 161,5 Mio. (+21,0 %) 2013: 133,5 Mio. E-BUSINESS E-COMMERCE E-PROCUREMENT/EDI M-COMMERCE SYSTEME + 17,4 % + 27,4 % + 230,0 % + 1,1 % 2014 135,8 Mio. EUR 14,5 Mio. EUR 6,7 Mio. EUR 4,5 Mio. EUR 2013 115,7 Mio. EUR 11,4 Mio. EUR 2,0 Mio. EUR 4,4 Mio. EUR Source: DE-Würth, SAP BW 24 WÜRTH GROUP - DIRECT SELLING IN THE DIGITAL WORLD Würth Group, 09/29/2015
Configurator & planer Inventory management Product finder 2. STRENGTHEN THE MULTI-CHANNEL DISTRIBUTION: WITH ADDED-VALUE E-SERVICES Online-Shop KD-App Fahrzeug-Zubehör-Finder Aufmaßskizzen Dübel Assy Dämmkappen Dichtstoff Dichtband Klebstoff Unterkeile Scheibenkleben Gehörschutz Fensterbau Sonnenschutz Insektenschutz Türen Technical Software Holzbau Glasauskunft Kabeltrommel 25 WÜRTH GROUP - DIRECT SELLING IN THE DIGITAL WORLD Würth Group, 09/29/2015
EXAMPLE PRODUCT FINDER ANCHOR Since Sept. 2014 Shop: 4.200 access/mth. App: 1.500 access/mth. 26 WÜRTH GROUP - DIRECT SELLING IN THE DIGITAL WORLD Würth Group, 09/29/2015
3. ACQUISITIONS RECENT TRANSACTIONS Company Sales 2014 in MEUR United Plywoods (USA, Würth Line Wood) 29 MEF (Italy, Electro Wholesale), 65% stake 120 Stelvio (Italy, Electronics) 21 Timberline Fasteners (USA, Würth Line Industry) 18 TOGE Dübel (Germany, Anchors) 7 AC Word (Czech Republic, Electro Wholesale) 5 Northern Safety (USA, Personal Protective Equipment) 170 Paravan (Germany, Car Customization for Disabled), 51% stake 20 Total 390 27 WÜRTH GROUP - DIRECT SELLING IN THE DIGITAL WORLD Würth Group, 09/29/2015
4. CONTINUED DIVERSIFICATION AS STABILISING FACTOR ACTIVITIES IN OVER 80 COUNTRIES BUSINESS UNITS 13 LARGEST CUSTOMER 65,1 MIO. EUR LARGEST SUPPLIER 59,3 MIO. EUR 3,2 MIO. ACTIVE CUSTOMERS 38 MIO. ORDERS PER YEAR 28 WÜRTH GROUP - DIRECT SELLING IN THE DIGITAL WORLD Würth Group, 09/29/2015
6. DIFFERENTIATION: WITH TAILOR-MADE DELIVERY SOLUTIONS Standard Order 48 HOURS Full Product Range Service 24 24 HOURS Full Product Range Immediate Shipping Service 3 HOURS Branch Product Range Click & Collect 60 MINUTES Branch Product Range Branch 15 MINUTES Branch Product Range Orsy Shelf 3 MINUTES Individual Product Range 29 WÜRTH GROUP - DIRECT SELLING IN THE DIGITAL WORLD Würth Group, 09/29/2015
AGENDA 1 2 3 4 Würth Group Business Overview Investment Financial Overview Merits Top Action Points in 2015 Direct Selling in the Digital World Potential Capital Market Offering Activities Overview 30 WÜRTH GROUP - DIRECT SELLING IN THE DIGITAL WORLD Würth Group, 09/29/2015
CAPITAL MARKET ACTIVITIES CORE ELEMENTS OF THE FINANCIAL POLICY transparency Active Benchmarking $ Safety before profit High equity ratio Capital market orientation A+ A Rating as a key indicator 31 WÜRTH GROUP - DIRECT SELLING IN THE DIGITAL WORLD Würth Group, 09/29/2015
CAPITAL MARKET ACTIVITIES 1st Note Issue 1988 17 further note issues amounting EUR 2,5 Bio. 1st USPP 2004 Source: Bloomberg 32 WÜRTH GROUP - DIRECT SELLING IN THE DIGITAL WORLD Würth Group, 09/29/2015
CAPITAL MARKET ACTIVITIES GROUP DEBT ISSUANCE PROGRAMME VOLUME ISSUER GUARANTOR OFFERINGS ISSUING CURRENCIES TERMS LISTING ARRANGER DEALER EUR 3 billion Würth Finance International B.V. Adolf Würth GmbH & Co. KG Public and Private Various fixed / floating Luxembourg, regulated market Deutsche Bank BofA Merrill Lynch, Credit Suisse, Deutsche Bank, DZ BANK AG, HSBC, Hypo Vorarlberg, Landesbank Baden-Württemberg, Nordea, Santander Global Banking & Markets, UBS Investment Bank, UniCredit Bank, Zürcher Kantonalbank 33 WÜRTH GROUP - DIRECT SELLING IN THE DIGITAL WORLD Würth Group, 09/29/2015
CAPITAL MARKET ACTIVITIES CASH HOLDINGS 2010-2015 (IN MIO. EUR) ø 598 Mio. EUR 34 WÜRTH GROUP - DIRECT SELLING IN THE DIGITAL WORLD Würth Group, 09/29/2015
CAPITAL MARKET ACTIVITIES DEBT CAPITAL MATURITY PROFILE MEUR 35 WÜRTH GROUP - DIRECT SELLING IN THE DIGITAL WORLD Würth Group, 09/29/2015
36 WÜRTH GROUP - DIRECT SELLING IN THE DIGITAL WORLD Würth Group, 09/29/2015
INVESTOR RELATION CONTACTS Adolf Würth GmbH & Co. KG Press and Public Relations Reinhold-Würth-Straße 12-17 74653 Künzelsau Germany Telephone: +49 7940 15-1186 Fax: +49 7940 15-4400 presse@wuerth.com Würth Finance International B.V. Postal address: P.O. Box 344 NL-5201 AH 's-hertogenbosch The Netherlands Telefon: +31 (0)73 681 49 00 Telefax: +31 (0)73 681 49 10 E-Mail: info@wuerthfinance.net 37 WÜRTH GROUP - DIRECT SELLING IN THE DIGITAL WORLD Würth Group, 09/29/2015