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1
Innovators in image processing
Martin De Prycker, President & CEO
BARCO
Results third quarter 2002
November 7, 2002
2
Operational results Q302
in € million Q302 YTD02 Q301 YTD01
Orders 163.6 521.8 146.8 525.3
Sales 145.8 474.2 153.7 492.5
EBIT 11.2 39.9 2.2 42.9
EBIT % 7.7% 8.4% 1.4% 8.7%
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Orders higher than Sales for 3rd consecutive quarter
* Results 2001 “pro forma” i.e. incl. dotrix n.v., Barco Graphics not consolidated
0
50
100
150
200
Q101 Q201 Q301 Q401 Q102 Q202 Q302
OrdersSalesEBI T
(in € million)
4
Results Barco
• Orders: order book has further increased in Q302 by € 18 million
• Sales: sales Q302 traditionally weak because of reduction in shipments to European customers due to holiday seasonAdditional impact from• Delayed internal deliveries due to transfer of mechanical
manufacturing from Belgium to Czech Republic• Yield problems with external suppliers
• EBIT: • Slight increase of gross margin from 55% for 1H02 to 56% in
Q302 by• Ongoing introduction of new features, compensating price pressure• Ongoing cost improvement
• Further reduction of manpower from 4132 end 2001, to 4000 employees worldwide
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BarcoProjection (1)
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70
80
90
100
Q101 Q201 Q301 Q401 Q102 Q202 Q302
Orders
Sales
EBI T
(in € million )
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BarcoProjection (2)• Sales
• Control Rooms: • Growth in new markets compensates low investments from Telecom• Orders Telecom picking up again in Q4
• New stand-alone projector iQ • Has won several awards• Not taking off fast enough yet
• Higher market share in V&AR thanks to growth in US market and TAN acquisition
• Events: • Q3: weaker investments by Events customers, picking up again in Q4
• Media• Media projects delayed• New product for Media applications available as of begin ‘03
• Hopeful signs from Digital Cinema, particularly in China
• EBIT: margin well maintained at 10.1% vs comparable quarters, Q301 (2.1%) and Q102 (9.3%), despite lower sales
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BarcoView (1)
-10
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60
70
80
Q101 Q201 Q301 Q401 Q102 Q202 Q302
Orders
Sales
EBI T
(in € million)
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BarcoView (2)
• Orders: • Orders in Security and Defense picking up again for existing and
new programs• Ongoing strong orders for ATC and Medical
• Sales: ongoing successes in • Air Traffic Control (ATC)
• Further market penetration of flat LCD panel, also in USA• Strengthening of market position by acquisition of Orthogon
• Medical• Introduction of high-end flat screens for Medical of 1, 2 and 5
megapixel besides 3 megapixel
• EBIT: much better than Q301
9
Orthogon joined Barco (Oct 1, 2002)Strategy:ATC is extending its portfolio with software and integration services, also towards end users
Market Share Orthogon:• Mainly ATC (80%) and expanding into Security & Defense to offer software and integration services• System integrators and end users• Mainly Europe (80%) with market
leadership• Short term growth potential in
USA in ATC• Long term growth potential
in Security & Defense
ATC I ndustry74%
Security & Defense
2%
Others14%
Eurocontrol10%
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BarcoVision
• Textile machine market in China and Turkey continues to go strong
• Sales weaker in Q3 due to seasonal effect
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5
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15
20
25
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Q101 Q201 Q301 Q401 Q102 Q202 Q302
Orders
Sales
EBI T
(in € million)
11
Barco Subcontracting
• Increase in manufacturing with components in consignment results in lower sales but yields higher gross margin
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5
10
15
20
25
30
Q101 Q201 Q301 Q401 Q102 Q202 Q302
Orders
Sales
EBI T
(in € million)
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Geographical breakdown of Turnover per Activity (%)
EU Nafta Asia ROW
BarcoProjection 37 35 24 4BarcoView 28 57 13 3BarcoVision 60 11 17 12
Total Q302 42 35 19 5
Total 1H02 46 32 16 6
Total 2001 48 30 16 6
13
OWC: Inventory• Inventory on same level as end Q202 due to slack in deliveries
and in preparation of higher sales in Q402
in € million
143132
126 128119
0
20
40
60
80
100
120
140
160
End 01 Mar J une Sept Target Dec
14
OWC: Accounts Receivable
92
84
7580
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20
30
40
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60
70
80
90
100
End 01 Mar J une Sept
(incl. BG)
Days outstanding
15
Net cash position
67.8
5655.2
11.8
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10
20
30
40
50
60
70
80
end 01 Q102 Q202 Q302
in € million
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Results Q3 & YTD
in € million Q302 YTD02 Q301* YTD01*
EBIT 11.2 39.9 2.2 42.9
Current Result 11.6 40.7 1.4 42.3
Taxes (3.2) (9.6) (0.3) (12.9)
Curr. Res. after Taxes 8.4 31.1 1.1 29.4
Extra-Ordinaries 0 (28.1) 0 (0.4)
Amort. Of goodwill 1.4 3.6 1.7 5.1
Net result 7.0 (0.5) (0.6) 23.9
Current EPS** 0.68 2.51 0.09 2.37
Current cash Flow 23.7 77.5 15.8 74
*”pro forma”, i.e. incl. dotrix n.v., Barco Graphics not consolidated
** in euro
17
Expectations Q402 and Full Year 2002
1. Sales Q4: 175/185 million euro, bringing 2002 sales to slightly lower level than 2001• Outspoken growth in BarcoView vs Q401 leading to
increase in sales Year on Year• Sales BarcoProjection lower vs Q401 resulting in
slightly lower sales Year on Year• Higher sales in BarcoVision vs Q401 but still lower
Year on Year
2. Profitability expected in the range of 21/25 million euro leading to considerably higher EBIT Year on Year
3. Current EPS full year 2002 expected between € 3.80 and € 4, i.e. an increase of at least about 40% compared to 2001
18
Innovators in image processing
Questions & Answers
www.barco.com