STRATEGIC

PLAN 2018

ROAD MAP TO 2020

17 November 2015
STRATEGIC PLAN 2018

ROAD MAP TO 2020

Disclaimer
This document is for information only and does not constitute an offer to sell, exchange or buy, or an invitation to make offers to
buy, securities issued by any of the companies mentioned. This financial information has been prepared in accordance with
International Financial Reporting Standards (IFRS), however, not being audited information is not definitive information and may
be modified in the future.
No representation or warranty is given by Fluidra S.A. as to the accuracy, completeness or fairness or any information contained
in this document and nothing in this report should be relied upon as a promise or representation as to the past, current situation
or future of the company and its group
The information contained in this document may contain statements regarding intentions, expectations or future prospects. All
statements, other than those based on historical fact are forward-looking statements, including, without limitation, those
regarding our financial position, business strategy, management plans and objectives for future operations. Such forward-looking
statements are affected, as such, by risks and uncertainties that could cause what happens in reality does not correspond with
them.
These risks include, among others, seasonal fluctuations that may change demand, industry competition, economic conditions
and legal restrictions on free trade and / or political instability in the markets where the Group Fluidra is present or in those
countries where the Group's products are manufactured or distributed. Fluidra Group makes no commitment to issue updates or
revisions concerning the forward-looking statements included in this financial information, expectations or in events, conditions
or circumstances on which underlying these forward-looking statements.
In any case, Fluidra Group provides information on these and other factors that may affect forward-looking statements, business
and financial results of the Company, in documents filed with the Comisin Nacional del Mercado de Valores of Spain. We invite
all interested persons or entities to consult those documents.

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Index
1. Framework for the Plan
2. Trends & Market and how we compete & win
3. Best practices for profitable growth
Case of Fluidra Comercial Espaa
Case of Metalast

4. Opportunities for profitable growth by geography

5. Financial outlook
6. Closing remarks

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Todays Speakers

Eloi Planes
Chief Executive
Officer (CEO)

Carlos Franquesa
Sales & Operations
General Manager

Xavier Tintor
Corporate
General Manager

With Fluidra for 23 years; appointed General Manager in 2004; CEO since 2006
Industrial Engineer (UPC) and MBA (EADA)
46 years old

With Fluidra since 2007; started as a COO; 2013 General Manager Europe; 2015
appointed GM for Sales & Operations
MBA & Degree in Business Administration by ESADE
52 years old

Joined Fluidra in 2010 as CFO; in 2015 appointed Corporate General Manager

MBA&Degree in Business Administration by ESADE, Master CEMS (HEC), PDG (IESE)
48 years old

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Todays Speakers
Mart Giralt
Managing Director of
Fluidra Comercial Espaa

Jaume Carol
Chief Operating Officer

Joined Fluidra in 2013; as General Manager of Iberia.

MBA & Degree in Business Administration by ESADE; PDD by IESE
49 years old

With Fluidra for 24 years; Has developed numerous positions of increasing responsibility in
operations, HQ and Sales. He currently is COO
Industrial Engineer (UPC)
52 years old

Peter Wallace
Managing Director of
AstralPool Australia

Paulo Flix
Managing Director of
Fluidra Brasil

In the Pool industry since 1982

Founded Hurlcon in 1990 which was acquired by Fluidra in 2006 and remaining the
company General Manager
Life Member of Spasa
55 years old
With Fluidra since 1999; started as Cepex Portugal General Manager; 2005 appointed as Cepex
Sales Manager; 2009 Business Development Manager; 2011 Business & Marketing Manager, 2014
Fluidra Brasil General Manager
Degree in Materials Engineering by FCT-UNL 1991/1996
Executive Development Program by ESADE 2011/2012
42 years old

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Framework for the Plan

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Fluidra evolution VS market evolution

1m
G.D.P.

+2.2%
Growing with the market
Sales CAGR 22.3 %
Ebitda 14.0%

1969

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

2018 2020

Source: IMF-WEO

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Fluidra evolution VS market evolution

-0.2%

+1.3%

G.D.P.

+6.8%

Balancing Evolution of Markets

Sales CAGR: -1.9%
Ebitda 10.6%

1969

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

2018 2020

Source: IMF-WEO

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Fluidra evolution VS market evolution

+1.7%

+2.3%

1m
G.D.P.

+7%

Profitable growth

1969

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

2018 2020

Source: IMF-WEO

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Evolution of the Global Pool Market

Global Evolution of Total Pool Base (In 000)

Global Evolution of New Pools (In 000)

18,000

600

15,000

500

12,000

400

9,000

300

6,000

200

3,000

100

2007

Europa

Australia

2009

2011

N. America

Asia

2013

LatAm

2015E

Africa&RoW

Europa

2007

2009

Australia

N. America

2011

Asia

2013

LatAm

2015E

Africa&RoW

Continued recovery of global pool market after the 2008 financial crisis
Strong recovery expected in mature markets (Europe & North America). Sustained growth in emerging markets.

Growth of pool market across the board expected to boost the industry and increase
the size of the potential market
Source: Associations reports, trade publications, annual reports, Internal studies & estimates
Note: Only refers to In Ground Pools

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Evolution new pools in key markets

Europe-Evolution of New Pools (in 000)

North America-Evolution of New Pools (in 000)

180

200

160

180

140

160
140

120

120

100

100

80

80

60

60

40

40

20

20
2007

2009

Europa

2011

2013

2015E

2007

2009

2011

2013

2015E

Spain

New pool builds is at its lowest point and should recover in the next years reflecting
a healthier industry
Source: Associations reports, trade publications, annual reports, Internal studies & estimates
Note: Only refers to In Ground Pools

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11

Fluidra is now stronger

more balanced and with great potential

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12

Fluidra is now stronger

in a healthier market
European Pool Market Model (2008)

European Pool Market Model (2014)

New
Construction
New
Construction

48%

31%
Existing
Base

Existing
Base

52%

69%

Fluidra benefits from recurring revenues coming from the pool base as well as
from a recovery of new construction

Source: Associations reports, trade publications, annual reports, Internal studies & estimates

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13

Strong geographical footprint

5.3M
76K

5.2M
87K
Robots

80%

2.5M
115K

86%

0.9M
18K

90%

Full strategy

0.3M
17K

Category strategy

73%
Total pools

1.3M
17K

100%

New pools

Branch coverage

International expansion in last years has developed a network that covers 89% of the park (Ex-US)

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14

Unbeatable product portfolio

CATEGORIES

MARKET
POSITION

2006

45

2015

>70

2006

50

2015

>100

2006

15

2015

>80

1/2

INNOVATION
Basic

Maintenance

Added value

Consistent investment in R&D and integration of new technologies has built an

unbeatable offering

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15

Experienced & passionate team

Board of directors
Mr. Joan Planes, Chairman
Mr. Eloi Planes, Chief Executive officer

Mr. Juan Ignacio Acha-Orbea, Independent Director: Finance

Mr. Gabriel Lpez, Independent Director: Audit
Mr. Richard J. Cathcart, Independent Director: US
Mr. Jordi Constans, Independent Director: Sales & Marketing
Mr. Carles Ventura, Director: Banc Sabadell
Mr. Oscar Serra, Director: Boyser

Mr. Albert Collado, Secretary

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Mr. Bernat Corbera, Director: Edrem

Mr. Bernat Garrigs, Director: Aniol

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16

Experienced & passionate Team

Top management

NUMBER OF PEOPLE

EXPERIENCE YEARS/PAX

AGE

COUNTRY

General
Management

13

49

Industry

16

52

Markets

13

11

45

12

46

Corporate

Balanced, motivated team of more than 4.000 employees with great know-how
of the business and high entrepreneurial spirit

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Proven & Efficient Best Practices

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.but heterogeneous in product categories

EUROPE

AUSTRALIA

ASIA

AFRICA

LATAM

Category 1
Category 2
Category 3
Category 4
Category 5
Category 6
Category 7
Achieving homogeneous penetration in all categories will drive incremental sales

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.but heterogeneous in best practices

EUROPE AUSTRALIA

ASIA

AFRICA

LATAM

USA

Sales & Customer Mng

Cash & Carry Branches
Engineering Solution
Logistic Model
Manufacturing Model
Consolidation

Achieving homogeneous best practices will drive incremental sales & profitability

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Focus on profitable growth

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21

In summary

Capitalize
all our
strengths

More
favourable
environment

Fluidras
Excellent
Position

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Strategic
Plan
Road Map
to 2020

22

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23

Trends & Market

How we compete & win

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Better prospects in key markets

Developed countries have overcome the 09 crisis
GDP per Capita (US$)- Developed

GDP per Capita (US$)- Emerging

80.000

14.000

70.000

12.000

60.000

10.000

50.000

8.000
40.000

6.000

30.000

4.000

20.000

2.000

10.000
0

0
2000

2005
Euro Area

2010
USA

2015

2020

Australia

2000
Brazil

2005
China

India

2010

2015

Mexico

South Africa

2020
Turkey

Housing recovery will drive pool construction.

Wealth increase will push pool construction.

Better outlook will increase

refurbishment/remodeling market.

Tourism will drive increase in commercial

segment of pool industry.

Source: International Monetary Fund-WEO

Note: Refers to GDP per Capita at current prices in US dollars

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25

Key trends help industry fundamentals

Larger older population will live in big cities
Growth in Number of Megacities (population>10m)
100
80

Numberofmegacitieshasalmost
tripledbetween19902014

Increased Life Expectancy

90
80

x8

60

70

40

60

20

50

40
1990

2014

2030

2050

2075

2100

1960

1980

2000
USA

Development of commercial pool &

wellness facilities

2020
Europe

2040

2060

Asia

Development of health and

well-being products

Source: Data360, Global Cities Institute, United Nations, World Bank

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26

Water & energy will impact the industry

driving the upgrading of the existing park of pools
Energy Consumption/Climate Change
TemperatureAnomaly(C)

0,8

9.000

0,6
6.000
0,4
3.000
0,2
0

0
1960

1970

1980

Carbon Emissions

Scarce

Stressed

Caution

Not Stressed

1990

2000

MillionMetricTonsofCarbon

Water Scarcity

2010

Temperature Change

No Data

Development of sustainable products Upgrading of existing pool base Green water treatment

Source: Carbon Dioxide Information Analysis Center, EPA, Few Resources, Growing Blue, NASA, United Nations
Notes: 1) Water Stress Level based on Growing Blue Index
2) Temperature change refers to Global Annual Mean Land-Ocean Temperature change

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27

Internet of Things offers great opportunity

to develop new business models
Estimated that approximately 50m
devices & objects will be connected
to the internet by 2020.
Economic impact of this
development estimated to be in the
range of US$4-11tn by 2025
captured mainly by business
applications.
Connectivity of products is a must Development of new business models

Source: Cisco, Internal Research, McKinsey & Company

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28

Focus on Pool
Building on our strengths

Pool

68%
Pool Water
Treatment

13%

Pool &
Wellness
Pool Fluid
Handling

8%

89%
Irrigation
& D.W.T

7%

Industrial
& Others

4%

Our business revolves around the pool

Note: Sales by business unit as % of total sales.

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29

Focus on Pool but outside of the US

Building on our strengths
Distributors perspective

Manufacturers perspective

8%

2014
Pool Market
(US)
43%

3.6B

16%

49%

2014
Pool Market
(US)

Distributor 1
Distributor 2
Others

2.7B

10%
5%

Manufacturer 1
Manufacturer 2
Manufacturer 3
Others

69%

The US is a consolidated market. Fluidra's business model faces significant barriers to entry

Source: Company elaboration based on country pool associations data and other public company data.

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The opportunity is significant

In terms of product and geographies
18%

Basic-Filter, Pump

41%

16%

Maintenance
Added Value - Robots,
Chlorinators

22%
2014
Pool Market
(ex US)

Commercial equipment

19%

3.2B
8%

84%

Europe

17%

Africa
Australia

Fluidra
Others

56%

14%
5%

LatAm
Asia & ME

Source: Company elaboration based on country pool associations data and other public company data.

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to continue building our international leadership

Clear #1 in most relevant markets
% of
Global
No. of
Countries Pool Base

Market Leader

31

40%

Export Leader

12

1%

Key Player

13

21%

5%

Export Player

Source: Company elaboration based on country pool associations data and other public company data.

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to continue building our international leadership

Competing with different players in every geography
Global leader
Fluidra

Others

16%

46%
Pool Market
(ex US)
Local/Regional
Players
Chemoform,
Waterco,FIJA
Group, Neptune,
Nextpool, Procopi,
Myrtha, QP,
Maytronics,

3.2B

23%
15%

Other Global
Players
Zodiac, Pool Corp,
Hayward, Pentair,
Lonza

Source: Company elaboration based on country pool associations data and other public company data

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Residential Pool
17%

2.6B
ex US
83%

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34

Unbeatable Product Portfolio

Residential-Split by Group and Application
GROUP

SALES

POSITION (2015)

NEW
CONSTRUCTION

EXISTING
POOLS

BASIC

208M

46%

54%

MAINTENANCE

94M

0%

100%

ADDED VALUE

147M

13%

87%

46%
21%

33%

Broad product portfolio that meets the needs of every step of the pool building & maintenance process

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Unbeatable Residential offering

Basic Category Products

SALES

POSITION
(2015)

NEW
CONSTR.

EXISTING
POOLS

208M

46%

54%

VIRON VARIABLE SPEED PUMP

The Viron pump was developed in Australia to deliver numerous advantages vs.
a traditional pump:

Energy savings of up to 85% ( 900/year).

Up to 75% quieter.

Strong performance both in new pools, and in upgrading of existing pools.

Sold over 25,000 units in Australia, and recently launched in Europe with great success.

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Unbeatable Residential offering

Maintenance Category Products

SALES

POSITION
(2015)

NEW
CONSTR.

EXISTING
POOLS

94M

0%

100%

100% of pools use Chemicals, its sales are stable even in unstable economic cycles

There is a real opportunity with specialty chemicals (preventive vs. reactive, specific application,
natural based), which are growing at a high rate and offer a substantially higher margin

Key will be combining a competitive position in the chlorine chemicals while growing steadily with
differentiated and exclusive specialty products

Chlorine based products have become a commoditized market, but changing formats and dosing
allows to differentiate and add value again to this category

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Unbeatable Residential offering

Added Value Category Products

SALES

POSITION
(2015)

NEW
CONSTR.

EXISTING
POOLS

147M

13%

87%

Added value products offer an opportunity to upgrade the existing park of pools
One of the best examples is the salt chlorinators systems:

Growth potential: Australia show a 95% penetration of this technology vs. 15% in Europe
Provides a better user experience by swimming in a salt pool
More comfort to pool owner by using less chemicals
The cell of the salt chlorinator is a consumable that needs to be replaced every 2 years

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38

Continued leadership in innovation

Multi-center & open R&D model

Innovation
Committee
Partners
Network

Customers

R&D+i

13
Centers of
Excellence

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R&D Invested: 1,4% of sales

New Product Sales: 10% - 2015
15% - 2018

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39

Delivering incremental value

Value

From product to service and solutions in less than 10 years

Basic
Product

Automated
Product

Sustainable
Product

System &
Solution

Service

Time
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40

Fluidra Connect: the Internet of Pools

Potential for new revenue streams
The smart solution offering to
the pool professional a
complete online pool control,
diagnosis and management.
Pool Professional
1. Expand Business
2. Gain efficiency
3. Increase customer loyalty

Pool owner
1. Peace of mind
2. Manage comfort features

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41

Business model: how we compete

Integrated value chain with own distribution

Installers
Retailers

Manufacturing
R+D+I

Builders
Other distributors B2B

PRIVATE LABEL

Mass Market B2C

KEYS OF
INTEGRATED
MODEL

Allows multichannel
approach with
differentiated brands &
personalized product.

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Pool Owners

Own distribution

PRIVATE LABEL

Integrated margin
High barrier to entry
Minimizes business risk

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42

A model that meets our customer needs

Excellent match of our model with industry success factors

PUSH STRATEGY
KEY
SUCCESS
FACTORS

One stop shop: pool, irrigation, fluid handling, water treatment.

Technical support & training
Availability in branch/on time delivery
After sales service

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43

Commercial Pool
11%

0.6B
89%

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ex US

44

Commercial Pool

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Unbeatable Product Portfolio

Commercial Products

SALES

POSITION
(2015)

NEW
CONSTR.

EXISTING
POOLS

67M

54%

46%

Development has been directed towards energy and water efficient products and systems
An example of an innovative solution is

a water treatment system validated by

Efficient: saves water and energy (-66% water renewal)

Comfort: clean environment without the smell of chlorine (-75% concentration of oxidants)

Health: avoids skin irritation, reduces ocular and respiratory problems (-20% reduction of
combined chloramines)

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46

Understanding decision making for commercial

owners play a key role on choosing the solution
DEVELOPERS
OWNERS

IDEA

PRE DESIGN

Preliminary design
Initial engineering
Initial cost estimates
Initial duration

DESIGN &
ENGINEERING
Design to build
Final engineering
Project costs
Planning
Tender preparation

EXECUTION

Project management
Cost management
Installation

Provide Engineering Services

to prescribe the use of Fluidra
products as the best solution for
Commercial pool installations

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47

A model that delivers to our customer needs

Owners

Complete match of industry success factor and our model

PUSH
KEY
SUCCESS
FACTORS

PULL

Technical support & training

On time delivery
After sales service

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Design & Engineering

Integrated solutions
Project management

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48

In summary

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Best practices
for profitable growth

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Proven & Efficient Best Practices

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52

Sales & Customer Management

Set of practices to maximize sales
impact:
35%

Professional pricing management

by product and client segment
Sales Activity Management (SAM):
Understand in every client where we
have opportunities to grow and
how to attack them. Sales Reps or
Inside Sales for smaller customers.

11.648

Sales Activity Management:

1.691

35%

278 Customers Qualified

Gap Opportunity (k)

1.996
1.666
1.209
1.152

65%

1.116
702

Potential Turnover: 18M

Total

Share of Wallet

Opportunity gap

STRATEGIC PLAN 2018

Public
Pool

Chem.

ROAD MAP TO 2020

Robots

CEPE
X

Covers

Spas

Pumps

511

1.540

Revest.

Others

53

Sales & Customer Management

Training programmes to increase
impact and efficiency:
35%

Product training: on-line

FluidrAcademy to train reps on
product and its advantages.
Coaching sales management to
capture full potential impact on
Pricing and Sales Activity
Management.
Tools: Implementation of Force
Manager to track effort, performance
and plans defined in Sales Activity
Management and Pricing.

Gain market share

Gain margin

From 5 to 25 countries

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Cash & Carry Branch

From old distribution warehouse branch to cash and carry concept:

35%

Concept
Size
# SKU
Headcount

Warehouse

Cash & Carry

Order & Wait

Self -service

1.200-1.500m2

600-800m2

9.000

1.500

6-7

3-4

Long waiting time

Brand awareness
Cross selling
Promotion

Expand concept from

37 branches to 88 in
next 3 years
Gain market share

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Fluidra Engineering Solutions

a model to serve commercial pool customers
35%

A team of people focused on:

Developing pre-design and final

design & engineering proposals.
Developing integrated solutions.
Project Management.
Project Installation (if needed).
From 35% of markets to 100% of
markets covered.
Hotels

Integrated
Solutions for
Verticals

Wellness centers
Aquatic Parks
Aquariums
Gyms & Clubs

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56

Logistic Model
Before

Now

Our model in Europe before 2011:

Shipments to customer from our branches.
Inefficiencies:
3 levels of warehouse generating
excess of inventory and logistic cost.
Irregular delivery service.

Our model in South Europe from 2011: Fluidra Direct

Direct shipment from Distribution Center to customer

Eliminates old style Fluidra branches and creates opportunity
to Cash& Carry concept in all potential branches.
27% inventory & 15% logistic cost reductions.

25%
Selfservice

75%
24-48h

Drivers for our logistic model:

Availability
Service at right cost

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Logistic Model
Our model 2015-2018
Expand Fluidra Direct where possible opening
Regional Distribution Center
Direct shipment from Regional Distribution
Center to customer
Maintains Country Traditional Branch

EU
SUPPLY

LOCAL
SUPPLY

Cash& Carry where possible

Next Distribution Centers:

Australia 2016
India 2016
Central Europe 2017
South Africa 2017
20%

Maintain our focus on Service and Working Capital

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F. Direct
max 5 days

50%

Deliveries max
3 days

30%

Selfservice

58

Manufacturing Model
3 practices to maximize Efficiency
expanding them worldwide:
Footprint consolidation
Product Category rationalization
Lean Manufacturing: Continuous improvement
and total quality.
(Productivity from 2010: 2% annual in Europe)
(Quality: Claimed order lines from 1,5% to 1,1% in 4 years).
(From 39 to 21 plants in 5 years)
World Class 33

35
30

Drivers for our

manufacturing model:

25
20

Average 14

Product range

15
10

Competitive cost

5
0

PT 1

PT 2

PT 3

PT 4

Flexibility

PT 5

Gain productivity

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Consolidator in a fragmented industry

Fluidra has been the consolidator of the
industry outside of the US since year 2000 with:
Technology: Salt chlorinators, Robots.
Distribution: Australia, Austria, Brazil,
Indonesia, China, UK, Russia, South Africa.
Acquisition approach: Small size acquisitons
of family run businesses with a risk/benefit
sharing approach that fits well with our industry.

Acquisition plan 2018

Sales size
Type
Valuation
criteria
Number
Inorganic
growth %
Geography

1-35M
Distribution, [Technology]
Target 4X EBITDA in 3 years
8-10
2-4% per year
Europe, LatAm, Asia

Gain market share

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Proven & Efficient Best Practices

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Distribution
Spain: Proven
successful practices

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Spain: Pool Market today

The Spanish pool market has 1.1M installed pools and is
valued at 300M

Fluidra Comercial Espaa

90M

On average, Spain has 1 pool for every 37 people.

New Pools: 16.000 built in 2014 / (estim.) 18.000 in 2015.
Market trend is back to growth (+2%).
Business remains on renovation/upgrade of the installed pool park.

208 Employees
19 Branches

15%

Fluidra Comercial Espaa

40%
30%

Residential

Competitor 1
Competitor 2

Commercial

Competitor 3

6%

85%

7%

17%

Rest. Compet.

Note: Fluidras share does not include sales done in Spain through other channels by other group companies..

STRATEGIC PLAN 2018

ROAD MAP TO 2020

63

New logistic model

Branches
(From Old Branches to C&C)

Inventory level
Logistic FTEs
(Average per Branch)

Transport Cost
(% of Net Sales)

Service Level
(% Perfect & Full Order delivery)

2011

2015

30

19

17 M

6 M

5.8

3.5

5.1%

4.0%

80%

90%

Closer to market, better service and more efficiently

STRATEGIC PLAN 2018

ROAD MAP TO 2020

64

New customer approach

2011

2015

79

68

GENERALIST
3 COMPANIES

SPECIALIST
Force Manager, Mobility

200-250

150

---

3,500 / 22

28%

30%

Company Consolidation
(From Companies to Business Units)

Sales Network
(Number of Reps)

Sales Activity Model

(Commercial Tools)

Capillarity and Efficiency

(Average num. Customers per Rep)

Inside Sales
(Num. Customer / Contacts per Day)

Market share

Closer to market, better service and more efficiently

STRATEGIC PLAN 2018

ROAD MAP TO 2020

65

Results 2008 - 2015

38.8%
6.3

126
95

2008

2011

-7.4%
88

2012

-8.0%

2.5%

81

83

2013

2014

48.5%

9.6%
91

E2015

SALES

2.8

2008

2011

175.0%
3.3

6.8

4.9

-57.1%
1.2

2012

2013

2014

E2015

EBITDA

Proven best practices deliver excellent operating leverage

STRATEGIC PLAN 2018

ROAD MAP TO 2020

66

Spain: Strategy 2018

Extend our current capillarity with 3 new Cash&Carry.
Consolidate our reliable Logistic Model.
Reinforcing and fostering our continuous training for a more specialized sales force.
Full speed on the implementation of SAM.
Replicate model in Portugal creating an Integrated team in Iberia.

Share 2018
32%

Perfect
Delivery
95%

STRATEGIC PLAN 2018

Sales
Growth
+3%

ROAD MAP TO 2020

Ebitda
Target
9.1%

67

Manufacturing
Metalast: Proven
successful practices

STRATEGIC PLAN 2018

ROAD MAP TO 2020

Metalast
Established: 1969
Location: Poliny (Barcelona)
Number of employees in 2015: 144
Production technology: Metal processing - Thermoplastics blowing

Business development until 2007:

Continued annual sales growth:

2001: 33M. 2007: 59M.

CAGR. 10%

Manufacturing of new family products addressed to new construction

Industrial management focused on growing.
From 2008 until 2015:

Decrease in sales volume:

2007: 59M. 2015: 36M.

CAGR. -4,3%

Adapt to environment by continuous improvement: gain profitability

STRATEGIC PLAN 2018

ROAD MAP TO 2020

69

Our Changes: Lean Manufacturing

Lay-out optimization

2007

2015

23.000 m2

18.000 m2

5 / 33

20 / 33

188

176

40,9% Gross Mg

45,5% Gross Mg

Continuous
improvement
(Level of excellence)

Footprint integration
Inventory turns
(In days)

Product redesign and

new developments

Implantation of LEAN manufacturing and new product development

STRATEGIC PLAN 2018

ROAD MAP TO 2020

70

Results 2007-2015

7.4

59

6.1

5,5
40

2007

2011

35

31

2012

2013

34

36

2014 E2015

SALES

2007

2011

4.6

4.7

2012

2013

6.7

2014 E2015

EBITDA

Continuous improvement to gain profitability

STRATEGIC PLAN 2018

ROAD MAP TO 2020

71

Strategy 2018
Full speed on the Lean implementation to reach 100% excellence
Productive plants consolidation.
Adapt capacity to support sales growth.
Reengineering and product development.
Reinforcing our continuous training for a deeper involvement of the staff.
Expand experience to rest of Intl plants: France, China

Level of
Excellence
33/33

Inventory
Turns
151

STRATEGIC PLAN 2018

Growth
+ 7,5%
Annual

ROAD MAP TO 2020

and South Africa.

Ebitda Target
19,0%

72

STRATEGIC PLAN 2018

ROAD MAP TO 2020

73

Opportunities for
profitable growth
Geographical markets

STRATEGIC PLAN 2018

ROAD MAP TO 2020

Geographical Markets
USA: Robotic cleaner niche strategy

Market size 65 M
4% of our sales

Core for pool: Mainly business of

residential pool and a huge base of
professional customers

Market size 2.5B

77% of our sales

Emerging for pool: Mainly commercial pool

business through projects

Market size 684 M

19% of our sales

STRATEGIC PLAN 2018

ROAD MAP TO 2020

75

USA: Niche strategy - Robotic cleaners market

Market size 2014 estimated in 65 M
Only 10% penetration of robots per installed pool.
Expected to grow in coming years.

Competitors Situation in US
Robots Market in volume

USRobotsMarketinunits
2014

Market

Fluidra market

Segments

% segment

share

Entry-mid

53%

59%

Fluidra

30%
28%
14%
14%
12%

Mid- high

47%

12%

Total

100%

34%

2%
0%

10%

20%

30%

40%

Our opportunity is to consolidate our predominant position in entry-mid

and gain market share in mid-high segment.

STRATEGIC PLAN 2018

ROAD MAP TO 2020

76

USA: Robotic cleaner strategy

Continue introducing new products from

Israel to the mid-high segment.
Implement Fluidras best practices to
reinforce our sales activity in the country.
Be the leader in all segments

STRATEGIC PLAN 2018

ROAD MAP TO 2020

77

Core Pool Markets: Penetration

8.5M
2.5B
16%
Total pools

Market trends:

Capillarity
Focus on installed base pools: Added value
Perfect service level
Commercial market already developed by actual customers
Few global players & major competitors are locals

Market size

Market share

Our opportunity is to further develop our business model to gain penetration

STRATEGIC PLAN 2018

ROAD MAP TO 2020

78

Core Pool Markets: Share by category

EUROPE

AUSTRALIA

S. AFRICA

BRAZIL

Category 1
Category 2
Category 3
Category 4
Category 5
Category 6
Category 7
Increase penetration in all categories to minimun 20% is 210M

STRATEGIC PLAN 2018

ROAD MAP TO 2020

79

Core Pool Markets: Best practices at full speed

Gain capillarity by opening new cash & carry
branches.

Perfect delivery to our customers.

Customer management to optimize share.
Introduce new product in added value categories.
Engineering solutions to improve penetration.
Expand success story of Spain and Australia

STRATEGIC PLAN 2018

ROAD MAP TO 2020

80

Australia:
Capillarity and local
vertical integration

STRATEGIC PLAN 2018

ROAD MAP TO 2020

Brazil:
Replicate successful
Australian case

STRATEGIC PLAN 2018

ROAD MAP TO 2020

Emerging Pool Markets: Focus on Commercial Pool

Market based on Commercial Pool
Residential market is not relevant
Highly fragmented markets
Market size: 684 M
Fluidra share: 15%
Fluidra Coverage from 73% to 90%
Market trends:

Tourism is the major driver

Prescription in Developers/Engineering companies
Our opportunity is to become a reference in Engineering Solutions

STRATEGIC PLAN 2018

ROAD MAP TO 2020

83

Emerging Pool Markets: Our strategy

Develop Engineering solutions concept:

From product prescription to project
management.
Further development of regional centres
of engineering (existing in Dubai and Singapore).
Global leader in Commercial Pool

STRATEGIC PLAN 2018

ROAD MAP TO 2020

84

Organic growth expected in all continents

384M
+3%

38M
+6%

71M
+5%

19M
+6%

15M
+9%

52M
+8%

Global organic growth will be around 5%

Note: Net sales for 2014 adjusted for divestitures. Expected organic CAGR from 2014 to 2018.

STRATEGIC PLAN 2018

ROAD MAP TO 2020

85

STRATEGIC PLAN 2018

ROAD MAP TO 2020

86

Financial outlook & Closing

STRATEGIC PLAN 2018

ROAD MAP TO 2020

Accelerated growth & operating leverage

ANNUAL
IMPACT
Market Growth

2-4%

Market share gains

2-3%

Organic Growth

4-7%

Acquisitions

2-4%

Total Growth

6-11%

STRATEGIC PLAN 2018

Operating leverage will drive

EBITDA growth x 2

Financial leverage & tax will

drive Net Income growth
even further

ROAD MAP TO 2020

88

Generating
More value

Profitable
Growth

Outlook of increasing returns for shareholders

2014(*)

TARGET 2018

CAGR14-18

Sales

579

750

7%

EBITDA

56

100

15%

Net Income

30

100%

ROCE

3%

10%

NWC/Sales

31%

28%

Capex/Sales

4%

4%

NFD/EBITDA

2.7X

2.2X

(*) Adjusted for divestitures and extraordinary expenses

STRATEGIC PLAN 2018

ROAD MAP TO 2020

89

Self funded strategic plan

Financial debt finances
liquid assets

Clear uses of Cash

POLICY

Dividends

50% payout

Acquisitions

Target 4X
EBITDA in
3 years

TARGET
2018

2014

TARGET
2018

15M

Net
Working
Capital

176M

210M

10-20M/year

Net
Financial
Debt

151M

220M

STRATEGIC PLAN 2018

ROAD MAP TO 2020

90

Cash generation & uses of cash

ACCUMULATED
2018

ACCUMULATED
2018

Free Cash Flow

123M

Dividends

52M

Change in NFD

68M

Acquisitions

80M

191M

Minority interest

15M

Earn out

31M

Other cash items

13M

191M
Note 1: Minority interest reflects cash used to purchase shares from minority owners in subsidiaries.
Note 2: Other cash items includes bank refinancing fees, purchase of shares and other balance sheet accounts of minor value.

STRATEGIC PLAN 2018

ROAD MAP TO 2020

9
1

Are we on the right track for 2018?

10%
642

6%
680

CAGR14
15%

CAGR14
7%
714

750

15%
29%
37%

579

92

100

83

72

56

2014

Guidance
2015

Guidance
2016

2017

Target 2018

2014

Guidance 2015Guidance 2016

SALES

2017

Target 2018

EBITDA

The evolution of 2015 and preliminary guidance for 2016

show that we are on the path to achieving targets

Note: 2014 adjusted for divestitures and extraordinary expenses

STRATEGIC PLAN 2018

ROAD MAP TO 2020

9
2

Closing Remarks

STRATEGIC PLAN 2018

ROAD MAP TO 2020

Fluidra is in growth mode again

Profitable growth

1969

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

2018 2020

Source: IMF-WEO

STRATEGIC PLAN 2018

ROAD MAP TO 2020

94

Fluidra is now a stronger company

in a healthier market

STRATEGIC PLAN 2018

ROAD MAP TO 2020

95

with proven best practices

STRATEGIC PLAN 2018

ROAD MAP TO 2020

96

and a clear roadmap

Sales & Customer Mng
(Number of countries implemented

2015

2018

5 countries

25 countries

37

88

35%

100%

84%

95%

14 over 33

22 over 33

Cash & Carry

(C&C over total branches)

Engineering Solutions
(% regions implementing)

Logistic Model
(% perfect delivery)

Manufacturing Model
(Level of excellence)

Consolidator

8-10

(Acquisitions)

STRATEGIC PLAN 2018

ROAD MAP TO 2020

97

to reach profitable growth

10%
642

CAGR14
15%

CAGR14
7%

6%

100

750
29%

680
37%

579

15%
83

72

56

2014

Guidance
2015

Guidance
2016

2017

Target 2018

2014

Guidance
2015

SALES

Guidance
2016

2017

Target 2018

EBITDA

Profitable growth targets

STRATEGIC PLAN 2018

ROAD MAP TO 2020

98

In summary: Why Fluidra?

with an attractive valuation

STRATEGIC PLAN 2018

ROAD MAP TO 2020

99

with an attractive valuation

6,5
100
94,7

83

82

72
3,5

50

65,7

64,9

3,1
2,6

47,7

2,28
1,91
2006

2007

2008

2009

72

72

70

2010

2011

STRATEGIC PLAN 2018

2,72

2,22

2012

2013

2014

ROAD MAP TO 2020

2015

2016

2017

2018

2020

100

THANK YOU

STRATEGIC PLAN 2018

ROAD MAP TO 2020