D ANNUAL REPORT 2019 E E P Y S T INTERROLL ANNUAL REPORT 2019 REPORT ANNUAL INTERROLL I S L S A E U N Q I S A E E_01_GB_Interroll_(Layout) [P]_478401.indd 1 11.03.20 13:58 559.7 MILLION NET SALES 72.3 MILLION EBIT 99.6 MILLION OPERATING CASH FLOW E_01_GB_Interroll_(Layout) [P]_478401.indd 1 11.03.20 13:58 KEY FIGURES in CHF millions, unless stated otherwise 2019 2018 2017 2016 2015 Order intake/net sales Total order intake 546.5 592.6 458.1 405.2 385.1 Drives 172.4 170.9 146.7 123.6 110.3 Rollers 110.1 108.0 105.8 93.5 93.4 Conveyors & Sorters 223.2 220.5 142.6 120.9 107.2 Pallet & Carton Flow * 54.0 60.5 55.6 63.5 49.8 Total net sales 559.7 559.9 450.7 401.5 360.7 Profitability EBITDA 96.1 93.2 66.3 65.7 58.2 in % of net sales 17.1 16.6 14.7 16.4 16.1 EBITA 78.3 78.6 54.1 54.7 47.6 in % of net sales 14.0 14.0 12.0 13.6 13.2 EBIT 72.3 69.4 47.4 47.9 39.8 in % of net sales 12.9 12.4 10.5 11.9 11.0 Result: Net profit 56.0 51.8 39.1 36.2 29.3 in % of net sales 10.0 9.3 8.7 9.0 8.1 Cash flow Operating cash flow 99.6 67.4 46.2 36.8 40.2 in % of net sales 17.8 12.0 10.3 9.2 11.1 Free cash flow 66.9 40.9 20.1 18.0 17.3 in % of net sales 12.0 7.3 4.5 4,5 4.8 Total investments 33.6 28.6 25.4 19.5 24.3 Balance sheet (as at 31.12.) Total assets 435.1 417.6 355.3 324.8 293.0 Goodwill 17.1 17.3 17.6 17.3 16.7 Net financial assets 76.9 52.0 37.1 38.0 31.3 Equity 304.0 284.8 261.7 233.1 207.6 Equity ratio (equity in % of total assets) 69.9 68.2 73.6 71.8 70.9 Return on equity yield (in %) 19.0 19.0 15.8 16.4 14.4 Other key figures RONA (return on net assets in %) 22.6 20.9 16.5 17.1 15.3 Average number of employees (FTE) 2,284 2,198 2,067 1,892 1,820 Net sales per employee (in CHF thousands) 245 255 218 212 198 Productivity (added value/total personnel expenses) 2.09 2.17 2.02 2.11 2.04 Interroll uses alternative performance figures. These alternative performance figures can be found on the Interroll homepage under “Investor Relations” (https://www.interroll.com/). * Listed as “Pallet & Carton Flow” category until 31 December 2019. From 1 January 2020, the product category will be listed as “Pallet Handling” and will include pallet conveyor technology in addition to flow storage solutions E_01_GB_Interroll_(Layout) [P]_478401.indd 2 11.03.20 13:58 ABOUT INTERROLL The Interroll Group is the leading global provider of material handling solutions. The company was founded in 1959 and has been listed on the SIX Swiss Exchange since 1997. Interroll provides system integrators and OEMs with a wide range of platform-based products and services in these categories: Rollers (conveyor rollers), Drives (motors and drives for conveyor systems), Conveyors & Sorters as well as Pallet Handling (flow storage systems). Interroll products and solutions are used in express and postal services, e-commerce, airports, the food & beverage industry, fashion, automotive sectors and many other manufacturing industries. Among the end users are leading brands such as Amazon, Bosch, Coca-Cola, DHL, Nestlé, Procter & Gamble, Siemens, Walmart and Zalando. Headquartered in Switzerland, Interroll has a global network of 34 companies with sales of CHF 559.7 million and around 2,400 employees (average headcount in 2019). www.interroll.com 28,000 34 2,400 CUSTOMERS COMPANIES EMPLOYEES AROUND AROUND AROUND THE WORLD THE WORLD THE WORLD INTERROLL PRODUCT GROUPS DRIVES ROLLERS CONVEYORS & SORTERS PALLET HANDLING E_01_GB_Interroll_(Layout) [P]_478401.indd 2 11.03.20 13:58 ANNUAL REVIEW 2 REPORT BY THE BOARD OF DIRECTORS AND GROUP MANAGEMENT 4 GROUP MANAGEMENT 6 INTERROLL ON THE CAPITAL MARKET 8 OUR BUSINESS 10 INTERVIEW WITH PAUL ZUMBÜHL 12 PRODUCT GROUPS 16 INTERVIEW WITH JENS STRÜWING & DR CHRISTOPH REINKEMEIER 22 REGIONS 26 INTERVIEW WITH DR BEN XIA 30 FINANCIAL POSITION, EARNINGS AND CASH FLOWS 34 CORPORATE RESPONSIBILITY 36 MARKETING 42 ROLLING ON INTERROLL 44 INTERROLL ACADEMY 46 CORPORATE GOVERNANCE 47 REMUNERATION REPORT 57 FINANCIAL STATEMENTS OF THE INTERROLL GROUP 67 FINANCIAL STATEMENTS OF INTERROLL HOLDING AG 121 E_01_GB_Interroll_(Layout) [P]_478401.indd 1 11.03.20 13:58 ANNUAL REVIEW 2 HIGHLIGHTS OF THE 2019 FINANCIAL YEAR SORTER PROJECT IN THE COURIER AND EXPRESS CAPACITY EXPANSION UNDER WAY IN ATLANTA SERVICES FIELD CROSSBELT SORTERS IN DEMAND $11 MILLION INVESTMENT Interroll received a major follow-up order from Siemens Postal, The company is investing in expansion of its site in Hiram (Atlanta, Parcel & Airport Logistics (SPPAL) to supply a total of five cross- USA). Completion of the second factory in mid-2020 will double belt sorters. The fully automated high-performance sorting system Interroll’s capacity in Atlanta. is to be installed in the existing system infrastructure of a Swiss reference customer. TRAINING COOPERATION WITH FRAUNHOFER Strengthening skills: The Interroll Academy began a cooperation SOLUTIONS FOR INDUSTRY 4.0 with the Fraunhofer Institute for Material Flow and Logistics The DC Platform, a perfectly coordinated range of motor rollers, (Dortmund, Germany) to train employees on the subject of controls and power supplies in 48-volt or 24-volt technology, “Management of material flow processes”. enables a unique range of conveyor applications. MAJOR FOLLOW-UP ORDER FROM KOREA VERSATILE PALLET CONVEYOR Interroll filled a major follow-up order from a Korean e-commerce Interroll is bringing a versatile pallet conveyor to market – the company, delivering around 12 km of Modular Conveyor Plat- Modular Pallet Conveyor Platform (MPP). form (MCP). This follows a major project for another distribution centre for the same client in 2017. Q1 Q2 E_01_GB_Interroll_(Layout) [P]_478401.indd 2 11.03.20 13:58 ANNUAL REVIEW 3 PRODUCTION BEGINS IN THE NEW THAILAND SITE END-TO-END SOLUTION GREATER CAPACITY FOR SOUTH EAST ASIA END-TO-END SOLUTION FOR AUTOMATED STORAGE Interroll has moved to a new, advanced plant in Phantong Interroll is expanding its Modular Pallet Conveyor Platform (Thailand) to better realise growth opportunities in South East (MPP) to include a new dynamic storage stacker crane and trans- Asia. The plant has a production line for the Modular Conveyor fer car that can enable fast, safe shipping of up to 100 pallets per Platform (MCP). hour into and out of storage. This means that Interroll solutions can provide the vital link between automated conveying and auto- SERVICE ENHANCED mated storage. In August 2019, Interroll acquired agents in Reykjavik, Iceland, strengthening its sales and service activities in the food & beverage NEW CFO IN 2020 segment, in particular in the fish industry. Interroll has announced that Heinz Hössli, 50, will be joining Interroll in the first half of 2020 in the function of Group Chief NEW PLANT IN MOSBACH Financial Officer. He will be replacing Daniel Bättig, who left the For optimal positioning ahead of future requirements, Interroll is company in late November 2019. reorganising its site configuration in southern Germany. The con- struction phase for a projected plant in Mosbach (Heidelberg SUCCESS IN CANADA region) will begin shortly. A total investment of EUR 40 million In December 2019, Interroll completed delivery of a 315-metre has been earmarked for the project. sorter for the Canadian courier service Loomis Express. The pro- ject value is in the low seven figures (CHF). Q3 Q4 E_01_GB_Interroll_(Layout) [P]_478401.indd 3 11.03.20 13:58 REPORT BY THE BOARD OF DIRECTORS AND GROUP MANAGEMENT 4 FOCUS ON CONTINUED SOLID GROWTH Paul Zumbühl, Chief Executive Officer Dear shareholders, valued customers, employees, EBIT grew by 4.2% to CHF 72.3 million (previous and business partners, year: CHF 69.4 million). Net profit rose by 8.2% to CHF 56.0 million (previous year: CHF 51.8 million) Following on from a record year in 2018, the Interroll with the net profit margin at 10.0% (previous year: Group significantly improved its performance in key 9.3%). areas in 2019 and also secured its future growth strategy. Operating cash flow increased significantly by 47.8% The rise in the Swiss franc had a noticeable effect on to CHF 99.6 million (previous year: CHF 67.4 mil- sales, which reached CHF 559.7 million almost lion). Gross investments reached CHF 33.6 million, an unchanged on the previous year (CHF 559.9 million), increase on the previous year (CHF 28.6 million). Free while sales growth in local currency increased by 2.3%. cash flow increased sharply again, by 64.5% to CHF Interroll was able to fully compensate for the one-off 66.9 million (previous year: CHF 40.9 million). large orders in the US in 2018 by increasing its product business and, in particular, by generating higher sales INNOVATION AND ENHANCEMENT from smaller and medium-sized project orders in the OF THE INTERROLL PLATFORM 2019 financial year. Our high level ofcustomer loyalty, Interroll’s consistent ability to innovate is one of the speedy delivery and extensive global network played a main drivers behind the Group’s sustained growth, key part in these strong results.