Shaping digital transformation - TAKKT...• Individual quotes • Project consulting • Custom-made products • Digital solution (e-procurement) • Real-time track and trace •

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Unicredit & Kepler Cheuvreux GCC, Frankfurt

Shaping digital transformation

TAKKT AG

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January 2018 Unicredit & Kepler Cheuvreux GCC 2

TAKKT AG

TAKKT is a portfolio of B2B direct marketing specialists


TAKKT AG

TAKKT is organized into seven divisions (as of January 1, 2018)


TAKKT AMERICA TAKKT EUROPE

Kaiser+Kraft group

ratioform group

newport group

Hubert group

Central group

D2G group

NBF group

TAKKT AG

restaurant equipment

Our divisions are product specialists and sell equipment and specialties with an average order value of 470 EUR


Kaiser+Kraft group

plant, warehouse and office equipment

ratioform group

packaging solutions

newport group

new business models and

start-ups

D2G group

display products

Hubert group

merchandising and food

equipment

NBF group

office equipment

Central group

TAKKT EUROPE TAKKT AMERICA

TAKKT AG

newport group established as an additional division to develop new business models


sales brands and start-up investments

• Bundle the web-based brands BiGDUG, certeo and Mydisplays and TAKKT start-up investments

• Provide an environment for the younger, fast-growing business models

• Allow a more independent positioning in their branding, product assortments and technology

• Enable a better focus on the requirements of smaller business customers

strategic target

TAKKT start-up investments

TAKKT AG

Our role in the market – value-add services for customers and suppliers beyond pure distribution


Our suppliers Our portfolio companies Our corporate customers

Fragmented supplier structure:

• Plant and warehouse equipment

• Office equipment

• Packaging solutions

• Display articles

• Food service supplies and sales promotion

Added values:

• Preselection of quality products

• Individual quotes

• Project consulting

• Custom-made products

• Digital solution (e-procurement)

• Real-time track and trace

• Sustainability

Fragmented customer structure:

• Corporations

• Medium-sized companies

• Small businesses

Several hundred suppliers per division Customer solutions along the value chain

Up to 1 million customers per division

TAKKT AG

Our multi-channel strategy offers multiple touch points for our customers according to individual preferences


Small

businesses

Mid-sized

corporates

Large

corporates

Customer Characteristics Channels

• Frequent and regular demand

• Focus on efficiency of procurement process and services

• Customer lifetime value (loyal)

• Less frequent, irregular demand

• Focus on price

• Transaction-oriented and less loyal

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TAKKT AG

B2B direct marketing: business model at a glance


• Most efficient way to market and distribute in the B2B market

• Constant gain of market share versus local, store-based retail network

• Clear business model which will benefit from the trends towards e-commerce and digitalization

• High profitability (EBITDA margin 12-15%) with a comparably low capex need (capex 1-2% of sales)

TAKKT AG

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TAKKT AG

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Strong business model with clearly defined targets


Diversify risk

• Diversified sales across regions and customer groups

• Balanced product range

Organic growth of 4 to 5% p.a. on average

• Efficiency of direct marketing

• Shaping the digital transformation with our digital agenda

Act sustainably

• Industry role model for sustainability

• Sustainability as “built-in” rather than an “add-on”

Growth via opportunistic acquisitions (average 5% p.a.)

• Well-established B2B market leaders in attractive market niches

• Access to new products, markets, customers and business models

EBITDA margin

corridor of 12-15%

TAKKT AG


Organic growth above GDP also due to efficiency of direct marketing model


Total market volume of EUR 100bn+ with growth potential in line with GDP

Store-based business: ~ 70-90%

Direct marketing: ~10-30%

Direct marketing is steadily gaining market share vs store-based business

TAKKT AG


Digitalization: our vision 2020


The implementation of our Digital Agenda will increase our midterm

organic sales growth.

We will invest up to EUR 50 million until 2020 in our people and new technologies.

VISION 2020

We want to double our e-commerce business until 2020 by creating an outstanding customer experience through digitalization.

We strive to transform our organization in a step change by putting digital first and

focusing on customer centricity.

TAKKT AG


E-Commerce channels today account for just below half of the business


28.0% 30.1%

36.5% 39.0%

46.3%

2013 2014 2015 2016 9M/2017

21.0%

15.7%

9.6%

from multi-channel webshops

from web-focused webshops

from e-procurement

9M/2017

Share of e-commerce in order intake (in %) Split between e-commerce channels (in %)

TAKKT AG


Gross profit margin stable above 40 percent, also due to private label and direct imports


13.9% 14.7%

15.9%

18.3%

20.6%

2013 2014 2015 2016 9M/2017

9.6% 10.0%

12.1%

13.7%

15.0%

2013 2014 2015 2016 9M/2017

Share of private labels in order intake (in %) Share of direct imports in purchase volume (in %)

TAKKT AG


Our 6 focus areas of the digital agenda


Strategy & Innovation

Process Automation

Technology

Customer Journey

Organization & Culture

• Marketplaces

• newport group

• TAKKT start-up investments

• Vendor Integration

• Smart shipping solutions

• Digitalization of workflows

• New ERP systems

• Improve web-shop technology

• Focused customer segmentation

• Personalized marketing

• Self service features

• Recruitment of 100 talents

• New ways of working

• New workspace

Data & Analytics

• Better use of customer data

• Business Intelligence

TAKKT AG


Our plan is to invest up to EUR 50 million until 2020 for the implementation of our digital agenda


(in EUR million) 2017 2018 2019 2020

opex investment (incl. personnel) 10 m 5 m 5 m 5 m

capex investment 10 m 5 m 5 m 5 m

We will recruit up to 100 additional employees with digital expertise

TAKKT AG


M&A activity as further driver for growth


2000 2006 2007 2009 2012 2012 2014 2015 2015 2017

Acquisition criteria

• mainly medium-sized companies (and smaller ones as add-on acquisitions)

• high EBITDA and gross margins • well established market leaders • ensure diversification and gain new expertise for the Group

Divestment criteria

• strategic fit • growth potential • profitability expectations

TAKKT AG


Diversification of regions, customer groups and product ranges


48%

29%

22% 1%

Regions

USAEurope without GermanyGermanyOthers

2016

Balanced contribution to sales from two continents

28%

28% 13%

14%

17%

Customer groups

ManufacturingServicesTradeNon-profit and public organizationsOthers

2016

Low dependency from single customer groups

18%

18%

22%

17%

9%

14% 2%

Product ranges

Storage and TransportPlant and EnvironmentOfficeFood and DiningPackaging and ShippingSales Promotion

2016

Broad product portfolio – multi-purpose use

TAKKT AG


Role model for sustainability in our industry


New long-term goal for the year 2020 have been defined

9.8%

1.7%

2016

2011

Examples

Percentage of sales from sustainable product ranges

Paper consumption per EUR million sales in t

13.7

34.9

2016

2011

TAKKT AG

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TAKKT AG


Key financial indicators


in EUR million 2012 2013 2014 2015 2016

Organic turnover development in percent -2.8 -2.6 5.5 4.7 5.2

Number of orders in thousand 2,016 2,171 2,182 2,225 2,409

Average order value in EUR 465 440 450 482 469

Gross profit margin in percent 43.3 43.6 42.6 42.6 42.6

EBITDA margin in percent 14.2 12.9 14.0 14.8 15.2

TAKKT cash flow in EUR million 92.7 83.4 98.7 114.2 125.6

Capital expenditure ratio in percent 0.9 1.0 1.4 1.3 1.4

TAKKT AG


Value-based KPIs


18.1%

12.5%

14.4% 15.7%

16.5%

2012 2013 2014 2015 2016

Return on capital employed (in %)

32.4

9.7

18.9

28.5

38.3

5.9

8.3

7.6

8.4

8.5 38.3

18.0

26.5

36.9

46.8

2012 2013 2014 2015 2016

TAKKT value added (in EUR million)

* Adjusted for amortization of intangible assets resulting from acquisitions and the related tax impact.

*

*

*

*

*

TAKKT AG


Strong free cash flow and solid balance sheet


324.9

273.0

217.5 244.0

177.5

2012 2013 2014 2015 2016

34.7% 39.0%

43.8% 49.1%

55.2%

2012 2013 2014 2015 2016

2.4 2.2

1.6 1.6

1.0

2012 2013 2014 2015 2016

95.3

68.4

88.1 89.5 101.4

2012 2013 2014 2015 2016

Free TAKKT cash flow (in EUR million)

• Strong cash conversion

• Low maintenance capex

Net financial debt (in EUR million)

• Quick deleve-raging in years without acquisitions

Equity ratio (in %)

• Equity ratio guided in a range between 30 and 60%

Net financial debt/EBITDA

• Comparably low debt to EBITDA ratio

TAKKT AG


TAKKT dividend policy


Annual payment of base dividend increased or stable since IPO in 1999

Payout ratio of 40% for 2016

EUR 0.55 per share

Reliable dividend policy

• Future payout ratio within a corridor of 35 to 45 percent of the profit

• TAKKT aims for a consistent and reliable dividend stream

• Willingness to return funds to shareholders via a special dividend when equity ratio is high and funds cannot be reinvested. Payment of special dividend in 2007, 2008 and 2011.

Attractive dividend

0.32 0.32 0.32

0.48 0.48 0.53

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Dividend per share in Euro 0.85 0.80 0.80

0.32 0.32 0.32 0.32 0.32

0.50 0.55

TAKKT AG

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TAKKT AG


Sales growth in the first nine months slowed down by US activities


137.4

119.7

16.3% 14.2%

9M/16 9M/17

841.8 845.4

9M/16 9M/17

Sales (in EUR million)

+0.4% growth +0.5% organic growth

Adjusted for one-offs, the margin in 9M/16 was 15.3%

EBITDA (in EUR million) and margin (in %)

TAKKT AG


Good growth in Europe


81.9

74.1

19.8% 17.5%

9M/16 9M/17

413.9 423.2

9M/16 9M/17

Sales (in EUR million) EBITDA (in EUR million) and margin (in %)

+2.2% growth +2.8% organic growth


TAKKT AG


Uncertainty in food retail und food service markets weighs on performance in the US


-1.3% decline -1.7% organic decline

65.3

53.9

15.3%

12.7%

9M/16 9M/17

428.1 422.4

9M/16 9M/17

Sales (in EUR million) EBITDA (in EUR million) and margin (in %)


TAKKT AG


High cash flow margin


in EUR million 9M/16 9M/17

EBITDA 137.4 119.7

- net interest exp. -6.3 -6.4

- current taxes -31.0 -27.7

TAKKT CF 100.1 85.6


profit 75.0 61.9

+ depreciation +21.4 +20.4

+ deferred taxes +3.7 +3.3

TAKKT CF 100.1 85.6

100.1

85.6

11.9% 10.1%

9M/16 9M/17

TAKKT cash flow (in EUR million) and margin (in %)

TAKKT AG


Strong cash flow generation



TAKKT cash flow 100.1 85.6

Change of net working capital as well as other adjustments -4.1 +2.2

Cash flow from operating activities 96.0 87.8

Capital expenditure on non-current assets -11.2 -20.0

Divestiture from non-current assets +0.3 +0.2

Proceeds from the disposal of consolidated companies +1.5 +0.0

Free TAKKT cash flow (for acquisitions, payout to shareholders and loan repayments)

86.6 68.0

TAKKT AG

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TAKKT AG

Organic growth overview


Organic growth 2014 2015 2016 Q1/17 Q2/17 Q3/17 9M/17

TAKKT Group +5.5% +4.7% +5.2% +4.1% -2.3% -0.1% +0.5%

TAKKT Europe +3.3% +0.7% +3.5% +6.6% -2.5% +4.6% +2.8%

TAKKT America +8.1% +10.0% +7.0% +1.5% -2.2% -3.8% -1.7%

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TAKKT AG

Outlook for 2017

• After Q3, TAKKT anticipates organic sales growth of 0 to 1 percent for the financial year 2017.

• At the same time, the Board continues to expect the EBITDA margin to come in at the middle of the target corridor. The EBITDA margin is anticipated to be between 13.2 and 13.5 percent.


TAKKT AG

Trennseite mit Hintergrund in Grau: Immer vollflächig. Das Logo in der Fußzeile wird in geschriebener Form eingesetzt. Kommt dann zum Einsatz, wenn innerhalb der Präsentation Themen optisch voneinander getrennt werden sollen. Trennfolientitel: Calibri Regular, 50 pt., Farbe Dunkelgrau Subtitel: Calibri Regular, 24 pt., Farbe Dunkelgrau TAKKT equity story


TAKKT AG


Group companies are market-leaders in attractive market niches with high operational margins

TAKKT equity story at a glance


TAKKT is a worldwide, diversified portfolio of B2B direct-marketing specialists for business equipment

Growth opportunities through organic initiatives (digital agenda) as well as upside from opportunistic acquisitions

Business model generates high free cash flows and allows stable dividend payouts

EBITDA margin corridor between 12 and 15%

Stable, long-term oriented shareholder structure with Franz Haniel & Cie. GmbH as majority shareholder

TAKKT AG


February 15.02. Preliminary figures 2017 March 21.03. Publication of the annual report 2017 and analysts' conference

TAKKT investor relations


IR Contact

Christian Warns / Benjamin Bühler Phone: +49 711 3465-8222 / -8223 Fax: +49 711 3465-8100 e-mail: [email protected] www.takkt.com TAKKT AG is headquartered in Stuttgart, Germany.

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Basic data TAKKT share Historic share price development (Xetra)

ISIN / WKN / Ticker DE0007446007 / 744600 / TTK

No. shares 65,610,331

Type No-par-value bearer shares

Share capital EUR 65,610,331

Listing September 15, 1999

Index SDAX, prime standard

Designated sponsors Equinet, Oddo Seydler, Kepler, Hauck & Aufhäuser

TAKKT AG

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http://www.takkt.com/

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Shaping digital transformation - TAKKT...• Individual quotes • Project consulting • Custom-made products • Digital solution (e-procurement) • Real-time track and trace •