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    MIPS   SE0009216278

MIPS AB (PUBL)

(MIPS)
  Report
Delayed Quote. Delayed Nasdaq Stockholm - 08/02 11:29:50 am
939 SEK   +3.30%
07/23MIPS : Interim Report
PU
07/22MIPS : Interim report January – June 2021
PU
07/22MIPS : Interim report January - June 2021
AQ
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MIPS : rsquo; presentation of the Q3 interim report 2020

11/19/2020 | 07:07am EDT

6 NOVEMBER 2020

MIPS' presentation of the Q3 interim report 2020

Key highlights

  • Strong performance in the quarter with 94% net sales growth (108% organic)
  • Continued high customer interaction with large amount of new projects
  • Launch of Team MIPS, first athlete out is Henrik Harlaut
  • Good consumer demand, mainly driven by bike helmets. Good growth anticipated coming quarters
  • Long-termfinancial target remains intact

2020 | Q3 Report

2

Bike - Strong demand for MIPS

  • High demand for MIPS solutions in bike helmets
  • We do expect the high demand situation to carry over to 2021
  • Increase both in bike helmets for commuting and recreational use all over the world
  • Historically bike helmet volumes have been concentrated at Q3 and Q4, however due to the demand situation we do expect high production will continue into 2021

2020 | Q3 Report

3

Snow - Recovered, but still soft numbers

  • Improvement in sales to ski helmet manufacturers in the quarter, mainly relating to the late orders due to the pandemic situation
  • The uncertainty of winter holiday season remains
    • Booking situation at ski resorts has improved vs. last quarter
    • Infrastructure challenges at ski resorts remains
    • Even if there is a strong season, there is limited possibility for brands to react to sales uplift, given the heavy demand situation in bike and limited capacity at factories
    • Due to the current restrictions, the outlook for the winter season may change rapidly

2020 | Q3 Report

Moto - Strong sales in the quarter

  • Strong sales, volumes improved vs. previous quarter, as communicated before
  • Similar trend in Moto as in bike, but not to the same magnitude
  • More brands launching MIPS. Demand is supported by the implementation of new standard (ECE 22.06), which includes rotational motion in the test protocol
  • Good consumer demand expected coming quarters

2020 | Q3 Report

5

Safety - Lined up for a good 2021

  • Good interest in Safety category from both helmet manufacturers and construction companies
  • Intensified debate and media attention around work related injuries with focus on brain traumas
  • We only announce new brands when first orders are delivered
  • Increased interest of MIPS internationally and volumes will start to ramp up in 2021

2020 | Q3 Report

6

Launch of Team MIPS

  • MIPS should be the obvious choice when buying a helmet
  • Key strategic initiative to increase awareness of the MIPS brand
  • Revision of brand platform done; several activities being rolled out, one of them is to create a Team MIPS with Mips ambassadors
  • Henrik Harlaut, the most decorated x-games skier in the world is the first athlete to join Team
    MIPS
  • Additional athletes will be announced coming months, great way to increase awareness of the MIPS brand

2020 | Q3 Report

MIPS - Makes helmets safer

7

Development in our different categories

SPORTS

MOTO

SAFETY

Third quarter/YTD 2020

Third quarter/YTD 2020

Third quarter/YTD 2020

Revenue, SEKm

96 / 210

Revenue, SEKm

6 / 14

Revenue, SEKm

0 / 0

Growth, %

91 / 24

Growth, %

142 / 24

Growth, %

- / -

No. of brands

102 (+3)

No. of brands

22 (+1)

No. of brands

2

MIPS has in total 111 buying customers (a customer can be active in several categories but only counted once in the "total customer" number)

2020 | Q3 Report

8

Development in the third quarter

  • Net Sales increased by 94%, organic growth was 108%
  • Gross profit up 91%, gross margin down 80 bps to 72.2%
  • OPEX - continue to invest in strategic priorities
  • EBIT was SEK 55m (20), EBIT margin 53.6% (38.6)
  • Cash flow - strong increase of operating cash flow to SEK 29m (12)

MIPS Group (SEKm)

Q3 20

Q2319

%

Net sales

102

53

94

Gross profit

74

39

91

Gross margin %

72.2

73.0

-

Operating profit (EBIT)

55

20

169

Operating margin (EBIT) %

53.6

38.6

-

Cash flow from operating activities

29

12

138

2020 | Q3 Report

Organic growth

108%

EBIT margin

53.6%

Operating cash flow

29

SEKm

9

Development first nine months

  • Net Sales increased by 24%, organic growth was 27%
  • Gross profit up 22%, gross margin down 120 bps to 72.5%. Adjusting for acquisitions, gross margin down 60 bps to 73.0%
  • OPEX - continue to invest in strategic priorities
  • Adjusted EBIT was SEK 92m (71), adjusted EBIT margin 41.0% (39.2)
  • Cash flow - increase in operating cash flow to SEK 66m (43)

MIPS Group (SEKm)

YTD 20

YTD 19

%

Net sales

225

180

24

Gross profit

163

133

22

Gross margin %

72.5

73.7

-

Operating profit (EBIT)

91

69

32

Operating margin (EBIT) %

40.5

38.3

-

Adjusted Operating profit (EBIT)

92

71

30

Adjusted Operating margin (EBIT) %

41.0

39.2

-

Cash flow from operating activities

66

43

54

2020 | Q3 Report

Organic growth

27%

Adjusted

EBIT

margin

41.0%

Operating cash flow

66

SEKm

10

Balance sheet and cash flow

  • Strong improvement of Cash flow from operating activities with SEK 29m (12) in the quarter
  • Cash and Cash Equivalents at SEK 233m (176)
  • Equity ratio 84% (86)

2020 | Q3 Report

CASH FLOW FROM OPERATING ACTIVITIES (SEKm)

31

29

24

24

23

20

12

15

10

6

8

8

12

4

6

3

1

0

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3

2016 2017 2018 2019 2020 -9

KEY BALANCE SHEET ITEMS AND CASH FLOW

MIPS Group (SEKm)

Q3 20

Q3 19

Total Assets

432

306

Equity

364

262

Equity ratio %

84

86

Cash & Equivalents

233

176

MIPS Group (SEKm)

Q3 20

Q3 19

Cash flow from operating

29

12

activities

11

Summary

  • Strong quarter mainly driven by good demand for bike helmets
  • The increased demand expected to continue into next year, assuming no dramatic change to current situation
  • Continued high project activity, strong momentum in all three categories
  • Roll out of the new brand platform continues, launch of Team MIPS
  • Good position to deliver according to the 2025 plan

2020 | Q3 Report

Net sales and adjusted EBIT-margin 12 months rolling

42%

350

41%

41%

41%

41%

45%

39%

37%

38%

40%

300

34%

312

35%

279

250

26%

268

263

30%

241

243

200

22%

22%

214

25%

193

171

20%

150

147

126

128

15%

100

10%

50

5%

0%

0

Q4 17

Q1 18

Q2 18

Q3 18

Q4 18

Q1 19

Q2 19

Q3 19

Q4 19

Q1 20

Q2 20

Q320

Net Sales SEKm

Adjusted EBIT-margin*

*Adjusted for costs in connection with the company's IPO during 2016 and 2017 and costs relating to acquisitions during 2019 and first and second quarter 2020. Adjusted EBIT margin includes legal costs relating to the company's previous litigation processes

12

Q&A

DISCLAIMER

Important message from MIPS AB

This presentation has been prepared by MIPS AB (publ) (the "Company") solely for use at this presentation and is furnished to you solely for your information and may not be reproduced or redistributed, in whole or in part, to any other person. The presentation does not constitute an invitation or offer to acquire, purchase or subscribe for securities. By attending the meeting where this presentation is made, or by reading the presentation slides, you agree to be bound by the following limitations.

Statements in this presentation, which are not historical facts, such as expectations, anticipations, beliefs and estimates, are forward-looking statements within the meaning of the United States Private Securities Litigation Reform Act of 1995. Such statements involve risks and uncertainties which may cause actual results to materially differ from those expressed in such forward-looking statements.

This presentation may contain various forward-looking statements that reflect management's current views with respect to future events and financial and operational performance. The words "believe," "expect," "anticipate," "intend," "may," "plan," "estimate," "should," "could," "aim," "target," "might," or, in each case, their negative, or similar expressions identify certain of these forward-looking statements. Others can be identified from the context in which the statements are made. These forward-looking statements involve known and unknown risks, uncertainties and other factors, which are in some cases beyond the Company's control and may cause actual results or performance to differ materially from those expressed or implied from such forward-looking statements. These risks include but are not limited to the Company's ability to operate profitably, maintain its competitive position, to promote and improve its reputation and the awareness of the brand, to successfully operate its growth strategy and the impact of changes in pricing policies, political and regulatory developments in the markets in which the Company operates, and other risks.

The information and opinions contained in this document are provided as at the date of this presentation and are subject to change without notice.

No representation or warranty (expressed or implied) is made as to, and no reliance should be placed on, the fairness, accuracy or completeness of the information contained herein. Accordingly, none of the Company, or any of its principal shareholders or subsidiary undertakings or any of such person's officers or employees accepts any liability whatsoever arising directly or indirectly from the use of this document.

2020 | Q3 Report

14

Attachments


ę Publicnow 2020
All news about MIPS AB (PUBL)
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Financials
Sales 2021 535 M 62,3 M 62,3 M
Net income 2021 215 M 25,1 M 25,1 M
Net cash 2021 393 M 45,8 M 45,8 M
P/E ratio 2021 111x
Yield 2021 0,50%
Capitalization 24 581 M 2 866 M 2 864 M
EV / Sales 2021 45,2x
EV / Sales 2022 35,2x
Nbr of Employees 74
Free-Float 100,0%
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Mean consensus OUTPERFORM
Number of Analysts 2
Last Close Price 909,00 SEK
Average target price 990,00 SEK
Spread / Average Target 8,91%
EPS Revisions
Managers and Directors
Max Strandwitz President & Chief Executive Officer
Karin Mari Bohlin Rosenthal Chief Financial Officer
Jan Magnus Welander Chairman
Hans Peter Halldin Chief Science Officer
Shuyi Isaksson Head-Operations
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