Download Report (PDF-File) - Rofin

Rofin-Sinar 

(CDAX, Technology) 

Hold 

USD 22.00 

Eggert Kuls 

ekuls@warburg-research.com 

+49 (0)40-309537-256 

(USD 25.90) 

Price EUR 17.31 

Upside 27.1 % 

Value Indicators: USD Share data: Description: 

DCF: 25.81 

FCF-Value Potential: 21.94 

Bloomberg: RSI GR 

Reuters: RSTI 

ISIN: US7750431022 

C O M M E N T Published 03.08.2012 1 

Rofin-Sinar is one of the two 

worldwide leading manufacturer of 

industrial laser equipment 

Market Snapshot: USD m Shareholders: Risk Profile (WRe): 2011/12e 

Market cap: 499 Freefloat 100.0 % Beta: 1.1 

No. of shares (m): 29 

Price / Book: 1.0 

EV: 426 

Net Gearing: -15 % 

Freefloat MC (ord.): 499 

Debt / Equity: 32 % 

Ø Trad. Vol. (ord./30d): 3.20 m 

Net debt / EBITDA: -1.3 x 

Rofin-Sinar to clearly miss sales guidance; Share buy-back announced 

Stated Figures Q3/2012: Comment on Figures: 

FY End: 30.9. 

in USD m 

Q3 

2012 

Q3 

2012e 

Q3 

2011 yoy 

9M 

2012 

9M 

2012e 

9M 

2011 yoy 

� Sales missed our expectation slightly, mainly due to a higher than 

expected negative currency impact of up to USD 9m 

� Profit figures were also slightly lower than our forecast due to lower 

gross profit margin and higher R&D expenses 

� Order intake of USD 135.3m was clearly below our quarterly forecast of 

USD 150m as the cyclical Laser equipment business suffered from the 

increasingly tough economic environment 

Sales 132 134 155 -15.0 % 393 395 428 -8.3 % 

EBIT 12 13 22 -44.7 % 35 36 62 -43.5 

Margin 9.1 % 9.8 % 14.1 % 8.9 % 9.1 % 14.4 % % 

Net income 8 9 15 -45.2 % 24 25 43 -42.9 

Margin 6.3 % 6.5 % 9.8 % 6.2 % 6.3 % 10.0 % % 

EPS 0.29 0.30 0.53 -45.0 % 0.85 0.86 2.50 -66.0 

% 

� Q3 turnover was burdened to the tune of USD 8.5–9.0m by the strong USD. Rofin-Sinar pointed out that business with the semiconductor 

industry was excellent in the quarter but is expected to slow down going forward. Region-wise North America was strong with an increase of 

18% while Europe and Asia were down 12% and 14% respectively. Order intake for fibre laser, the most modern laser technology, amounted 

to USD 24.5m or 18% of total in the quarter. Lower than expected order intake will very probably lead to Q4 figures on the quarterly levels of 

Q1 to Q3 only. This means that the company will significantly miss its former sales guidance of USD 550–570m for FY 2011/12. Three 

months ago management was rather convinced that things would improve significantly in Q4. In our view, this improvement is unlikely 

because of the worsening worldwide economic environment and as the Laser equipment business is extremely cyclical. While the order 

intake especially is bad news, we regard as positive the announcement that the company will buy back shares to the value of up to USD 20m 

over the next 12 months. Based on the current share price Rofin-Sinar could buy back up to 1.2m shares which is equivalent to ca. 4% of the 

current share capital. The share is trading at book value. Rofin-Sinar can easily afford the share buy back as net cash as of June 30 stood at 

USD 80.5m or USD 2.80 per share. Q4 guidance includes sales of USD 125–130m and EPS of USD 0.25–0.28. This translates into FY sales 

of between USD 518–523m and EPS of USD 1.10–1.13. 

� In accordance with estimates we have lowered our price target from USD 25.90 to 22.00. As we see no positive trigger for the share short 

term we keep our Hold rating for the time being. The start to the next business year 2012/13 will most probably also be sluggish. 

Changes in Estimates: Comment on Changes: 

FY End: 30.9. 

in USD m 

2011/12e 

(old) 

+ / - 2012/13e 

(old) 

+ / - 2013/14e 

(old) 

Sales 556 -6.2 % 595 -6.2 % 654 -6.2 % 

EBIT 57 -20.8 % 73 -18.3 % 90 -16.7 % 

EPS 1.31 -14.9 % 1.68 -18.1 % 2.09 -16.6 % 

DPS 0.00 0.0 % 0.00 0.0 % 0.00 0.0 % 

Net Debt -92 n.m. -131 n.m. -162 n.m. 

Rel. Performance vs CDAX: 

1 month: -10.4 % 

6 months: -32.1 % 

Year to date: -36.7 % 

Trailing 12 months: -40.0 % 

Company events: 

11/08/12 Q4 

11/29/12 2011/2012 

FY End: 30.9. 

in USD m 

+ / - 

� Weak order intake in Q3 has prompted us to revise down our 

assumptions for Q4. We now expect turnover of USD 521m in FY 

2011/12, down 6.2% compared to our former estimate. This also means 

that Rofin will clearly miss the sales guidance of USD 550–570m 

reiterated in May. 

� Earnings figures are also lowered due to our revised sales assumptions 

CAGR 

(11-14e) 2007/08 2008/09 2009/10 2010/11 2011/12e 2012/13e 2013/14e 

Sales 0.9 % 575 350 424 598 521 558 614 

Change Sales yoy 19.9 % -39.2 % 21.2 % 41.1 % -12.8 % 7.0 % 10.0 % 

Gross profit margin 43.1 % 37.8 % 39.3 % 38.8 % 37.1 % 38.2 % 39.4 % 

EBITDA -2.6 % 119 21 56 97 59 73 89 

Margin 20.8 % 6.0 % 13.1 % 16.2 % 11.3 % 13.1 % 14.5 % 

EBIT -3.7 % 96 8 44 84 45 59 75 

Margin 16.7 % 2.3 % 10.4 % 14.0 % 8.7 % 10.6 % 12.2 % 

Net income -5.7 % 65 9 30 60 29 40 50 

EPS -5.4 % 2.09 0.32 1.04 2.06 1.12 1.37 1.75 

EPS adj. - n.a. n.a. n.a. n.a. n.a. n.a. n.a. 

DPS - 0.00 0.00 0.00 0.00 0.00 0.00 0.00 

Dividend Yield 0.0 % 0.0 % 0.0 % 0.0 % 0.0 % 0.0 % 0.0 % 

FCFPS 2.98 1.30 1.00 0.75 -0.48 1.01 0.61 

EV / Sales 1.6 x 1.5 x 1.4 x 1.4 x 0.8 x 0.7 x 0.6 x 

EV / EBITDA 7.5 x 24.9 x 10.6 x 8.9 x 7.2 x 5.4 x 4.2 x 

EV / EBIT 9.3 x 65.0 x 13.4 x 10.2 x 9.4 x 6.7 x 5.1 x 

P / E 14.6 x 63.9 x 21.9 x 15.7 x 15.5 x 12.6 x 9.9 x 

P / E adj. n.a. n.a. n.a. n.a. n.a. n.a. n.a. 

FCF Yield Potential 8.4 % 3.3 % 6.1 % 7.6 % 8.3 % 11.6 % 15.0 % 

Net Debt -38 -70 -77 -90 -77 -110 -131 

ROE 15.3 % 2.2 % 7.2 % 13.5 % 5.9 % 7.7 % 9.1 % 

ROCE n.a. 1.1 % 6.3 % 12.0 % 5.5 % 7.3 % 8.6 % 

Guidance: Fiscal 11/12: Sales between USD 518-523m, PBT-margin 9-10%


Sales development 

in EUR m 

Source: Warburg Research 

Company Background 

Sales by regions 

2011; in % 



EBIT development 

in EUR m 


� Laser technology company Rofin-Sinar was founded in 1975. In 1996 the company was listed on the American technology stock 

exchange, Nasdaq, as the first 100% spin-off of Siemens AG. 

� The company has production sites in the USA, Germany, UK, Finland, Sweden, Spain, Singapore and China. The two operating 

headquarters are based in Plymouth (Michigan, USA) and Hamburg. 

� Rofin-Sinar develops and produces laser sources and laser-based system solutions. The technology basis includes CO2 laser, lamp 

and diode-pumped solid-state lasers as well as fibre and diode lasers. 

� In addition to its main customer industries, automotive, machine tools as well as semiconductors and electronics, Rofin-Sinar supplies 

various other industries. 

Competitive Quality 

� With a world market share of ca. 23% Rofin-Sinar is the clear world market leader in industrial lasers together with the non-listed 

Trumpf (Germany). 

� The most important competitors in macro applications are Trumpf, Fanuc, Coherent and Synrad for CO2 lasers and Laserline and 

Jenoptik for diode lasers. 

� In the Micro and Marking segments the main competitors are Trumpf, GSI Group, Unitek Miyachi, Lasag, IPG and Control Laser. 

� IPG Photonics is market leader in the field of fibre lasers. This technology in part has advantages over the common laser technologies 

such as improved energy efficiency. Rofin-Sinar is the No. 2 here. 

� In the past the sector generally grew by ca. 10% p.a. and more over an economic cycle. Growth in the laser industry benefits from a 

continuous expansion of the application possibilities. 

EBT development 

in EUR m 


Sales by segments 

2011; in % 


Net income development 

in EUR m 

Source: Warburg Research


DCF model 

Detailed forecast period Transitional period Term. Value 

Figures in USD m 2011/12 2012/13e 2013/14e 2014/15e 2015/16e 2016/17e 2017/18e 2018/19e 2019/20e 2020/21e 2021/22e 2022/23e 2023/24 

Sales 

e 

521 558 614 663 716 773 835 901 974 1,051 1,136 1,192 

e 

1,252 

Sales change -12.8 % 7.0 % 10.0 % 8.0 % 8.0 % 8.0 % 8.0 % 8.0 % 8.0 % 8.0 % 8.0 % 5.0 % 5.0 % 2.5 % 

EBIT 45 59 75 80 86 93 100 108 117 126 136 143 150 

EBIT-margin 8.7 % 10.6 % 12.2 % 12.0 % 12.0 % 12.0 % 12.0 % 12.0 % 12.0 % 12.0 % 12.0 % 12.0 % 12.0 % 

Tax rate (EBT) 35.6 % 32.2 % 31.6 % 32.0 % 32.0 % 32.0 % 32.0 % 32.0 % 32.0 % 32.0 % 32.0 % 32.0 % 32.0 % 

NOPAT 29 40 51 54 58 63 68 74 79 86 93 97 102 

Depreciation 14 14 15 16 17 19 20 22 23 25 27 27 29 

in % of Sales 2.6 % 2.5 % 2.4 % 2.4 % 2.4 % 2.4 % 2.4 % 2.4 % 2.4 % 2.4 % 2.4 % 2.3 % 2.3 % 

Changes in provisions 0 1 1 -20 0 0 0 0 0 0 0 0 0 

Change in Liquidity from 

- Working Capital 1,962 3,271 4,978 2 24 26 28 30 32 35 38 26 27 

- Capex 16 17 18 19 20 22 23 25 27 29 32 32 34 

Capex in % of Sales 3.1 % 3.0 % 2.9 % 2.8 % 2.8 % 2.8 % 2.8 % 2.8 % 2.8 % 2.8 % 2.8 % 2.7 % 2.7 % 

Other 1,149 3,902 5,797 0 0 0 0 0 0 0 0 0 0 

Free Cash Flow (WACC 

Model) 

0 0 0 29 32 34 37 40 43 47 50 67 70 78 

PV of FCF 0 0 0 22 22 22 22 21 21 21 21 26 25 428 

share of PVs 0.00 % 34.13 % 65.87 % 

Model parameter Valuation (m) 

Derivation of WACC: Derivation of Beta: Present values 2023/24e 222 

Terminal Value 428 

Debt ratio 15.00 % Financial Strength 1.00 Financial liabilities 23 

Cost of debt 4.2 % Liquidity 1.00 Pension liabilities 18 

Market return 9.00 % Cyclicality 1.50 Hybrid capital 0 

Risk free rate 4.00 % Transparency 1.00 Minority interest 5 

Others 1.20 Market val. of investments 0 

Liquidity 130 No. of shares (m) 28.5 

WACC 8.88 % Beta 1.14 Equity Value 736 Value per share (USD) 25.81 

Sensitivity Value per Share (USD) 

Terminal Growth Delta EBIT-margin 

Beta (WACC) 1.75 % 2.00 % 2.25 % 2.50 % 2.75 % 3.00 % 3.25 % Beta (WACC) -1.5 pp -1.0 pp -0.5 pp 0.0 +0.5 pp +1.0 pp +1.5 pp 

1.38 (9.9 %) 20.78 21.11 21.47 21.85 22.26 22.69 23.16 1.38 (9.9 %) -288.69 -287.35 -286.00 -284.65 -283.30 -281.95 -280.60 

1.26 (9.4 %) 22.38 22.78 23.22 23.68 24.17 24.71 25.29 1.26 (9.4 %) -289.86 -288.41 -286.95 -285.50 -284.04 -282.58 -281.13 

1.20 (9.1 %) 23.27 23.72 24.19 24.70 25.25 25.85 26.50 1.20 (9.1 %) -290.37 -288.85 -287.34 -285.82 -284.31 -282.79 -281.28 

1.14 (8.9 %) 24.23 24.72 25.25 25.81 26.43 27.09 27.82 1.14 (8.9 %) -290.81 -289.23 -287.65 -286.07 -284.49 -282.91 -281.33 

1.08 (8.6 %) 25.26 25.81 26.39 27.02 27.71 28.45 29.27 1.08 (8.6 %) -291.19 -289.54 -287.89 -286.24 -284.59 -282.94 -281.29 

1.02 (8.4 %) 26.38 26.98 27.63 28.34 29.10 29.94 30.86 1.02 (8.4 %) -291.48 -289.75 -288.03 -286.30 -284.58 -282.85 -281.13 

0.90 (7.9 %) 28.91 29.65 30.47 31.35 32.33 33.40 34.59 0.90 (7.9 %) -291.77 -289.88 -287.98 -286.08 -284.18 -282.28 -280.38 

� … 

C O M M E N T Published 03.08.2012 3


Free Cash Flow Value Potential 

Warburg Research's valuation tool "FCF Value Potential" reflects the ability of the company to generate sustainable free cash flows. It is based on the 

"FCF potential" - a FCF "ex growth" figure - which assumes unchanged working capital and pure maintenance capex. A value indication is derived by 

discounting the “FCF potential” of a given year with the weighted costs of capital. The fluctuating value indications over time add a timing element to the 

DCF model (our preferred valuation tool). 

in USD m 2007/08 2008/09 2009/10 2010/11 2011/12e 2012/13e 2013/14e 

Net Income before minorities 64 10 30 61 30 41 51 

+ Depreciation + Amortisation 23 13 12 13 14 14 15 

- Net Interest Income 3 0 0 0 0 0 0 

- Maintenance Capex 9 5 6 9 8 8 9 

+ Others 0 0 0 0 0 0 0 

= Free Cash Flow Potential 76 18 36 65 35 46 57 

Free Cash Flow Yield Potential 8.4 % 3.3 % 6.1 % 7.6 % 8.3 % 11.6 % 15.0 % 

WACC 8.88 % 8.88 % 8.88 % 8.88 % 8.88 % 8.88 % 8.88 % 

= Enterprise Value (EV) 899 525 591 857 426 397 378 

= Fair Enterprise Value 855 198 407 732 397 520 639 

- Net Debt (Cash) -108 -108 -108 -108 -95 -129 -151 

- Pension Liabilities 18 18 18 18 18 19 20 

- Others 0 0 0 0 0 0 0 

- Market value of minorities 5 5 5 5 5 5 8 

+ Market value of investments 0 0 0 0 0 0 0 

= Fair Market Capitalisation 940 283 492 818 470 625 763 

No. of shares (total) (m) 29 29 29 29 29 29 29 

= Fair value per share (USD) 32.65 9.83 17.10 28.39 16.30 21.71 26.50 

premium (-) / discount (+) in % -5.8 % 25.4 % 53.1 % 

Sensitivity Fair value per Share (USD) 

11.88 % 25.41 8.18 13.67 22.20 12.95 17.33 21.10 

10.88 % 27.47 8.66 14.65 23.96 13.91 18.58 22.65 

9.87 % 29.95 9.23 15.83 26.09 15.06 20.09 24.50 

WACC 8.88 % 32.99 9.93 17.27 28.69 16.47 21.94 26.77 

7.88 % 36.80 10.81 19.09 31.95 18.24 24.25 29.62 

6.87 % 41.71 11.95 21.43 36.16 20.53 27.24 33.30 

5.88 % 48.30 13.47 24.57 41.81 23.59 31.25 38.23 

� … 



Valuation 

2007/08 2008/09 2009/10 2010/11 2011/12e 2012/13e 2013/14e 

Price / Book 2.3 x 1.4 x 1.6 x 2.0 x 1.0 x 0.9 x 0.9 x 

Book value per share ex intangibles 9.82 10.73 10.75 12.76 12.62 13.52 14.97 

EV / Sales 1.6 x 1.5 x 1.4 x 1.4 x 0.8 x 0.7 x 0.6 x 

EV / EBITDA 7.5 x 24.9 x 10.6 x 8.9 x 7.2 x 5.4 x 4.2 x 

EV / EBIT 9.3 x 65.0 x 13.4 x 10.2 x 9.4 x 6.7 x 5.1 x 

EV / EBIT adj.* 9.3 x 65.0 x 13.4 x 10.2 x 9.4 x 6.7 x 5.1 x 

P / FCF 51.6 x 12.4 x 23.5 x 33.4 x n.a. n.a. n.a. 

P / E 14.6 x 63.9 x 21.9 x 15.7 x 15.5 x 12.6 x 9.9 x 

P / E adj.* n.a. n.a. n.a. n.a. n.a. n.a. n.a. 

Dividend Yield 0.0 % 0.0 % 0.0 % 0.0 % 0.0 % 0.0 % 0.0 % 

Free Cash Flow Yield Potential 8.4 % 3.3 % 6.1 % 7.6 % 8.3 % 11.6 % 15.0 % 

*Adjustments made for: - 



Consolidated profit and loss 

In USD m 2007/08 2008/09 2009/10 2010/11 2011/12e 2012/13e 2013/14e 

Sales 575 350 424 598 521 558 614 

Change Sales yoy 19.9 % -39.2 % 21.2 % 41.1 % -12.8 % 7.0 % 10.0 % 

COGS 327 218 257 366 328 344 372 

Gross profit 248 132 166 232 193 213 242 

Gross margin 43.1 % 37.8 % 39.3 % 38.8 % 37.1 % 38.2 % 39.4 % 

Research and development 41 32 30 38 44 46 49 

Sales and marketing 0 0 0 0 0 0 0 

Administration expenses 104 89 90 108 102 106 115 

Other operating expenses 0 0 0 0 0 0 0 

Other operating income 0 0 0 0 0 0 0 

Unfrequent items 0 0 0 0 0 0 0 

EBITDA 119 21 56 97 59 73 89 

Margin 20.8 % 6.0 % 13.1 % 16.2 % 11.3 % 13.1 % 14.5 % 

Depreciation of fixed assets 16 9 9 10 11 12 12 

EBITA 103 12 n.a. n.a. n.a. n.a. n.a. 

Amortisation of intangible fixed assets 7 4 2 3 2 2 2 

Goodwill amortization 0 0 0 0 0 0 0 

EBIT 96 8 44 84 45 59 75 

Margin 16.7 % 2.3 % 10.4 % 14.0 % 8.7 % 10.6 % 12.2 % 

EBIT adj. 96 8 44 84 45 59 75 

Interest income 5 1 1 1 1 1 1 

Interest expenses 2 2 1 1 1 1 1 

Other financial income (loss) -1 7 2 3 0 0 0 

EBT 98 14 46 86 45 58 74 

Margin 17.1 % 4.1 % 10.8 % 14.4 % 8.5 % 10.4 % 12.0 % 

Total taxes 33 5 15 26 16 19 23 

Net income from continuing operations 64 10 30 61 30 41 51 

Income from discontinued operations (net of tax) 0 0 0 0 0 0 0 

Net income before minorities 64 10 30 61 30 41 51 

Minority interest 1 0 -1 -1 -1 -1 -1 

Net income 65 9 30 60 29 40 50 

Margin 11.3 % 2.6 % 7.0 % 10.0 % 5.5 % 7.1 % 8.2 % 

Number of shares, average 30 29 29 29 30 30 30 

EPS 2.09 0.32 1.04 2.06 1.12 1.37 1.75 

EPS adj. n.a. n.a. n.a. n.a. n.a. n.a. n.a. 

*Adjustments made for: 

Guidance: Fiscal 11/12: Sales between USD 518-523m, PBT-margin 9-10% 

Financial Ratios 

2007/08 2008/09 2009/10 2010/11 2011/12e 2012/13e 2013/14e 

Total Operating Costs / Sales n.a. n.a. n.a. n.a. n.a. n.a. n.a. 

Operating Leverage 0.7 x 2.3 x 21.0 x 2.2 x 3.6 x 4.4 x 2.6 x 

EBITDA / Interest expenses 51.2 x 12.0 x 57.0 x 131.9 x 73.7 x 91.6 x 111.6 x 

Tax rate (EBT) 34.0 % 36.2 % 33.6 % 30.3 % 35.6 % 32.2 % 31.6 % 

Dividend Payout Ratio 0.0 % 0.0 % 0.0 % 0.0 % 0.0 % 0.0 % 0.0 % 

Sales per Employee 338,399 200,103 241,902 303,125 254,268 268,143 286,687 

Sales, EBITDA 

in EUR m 


Operating Performance 

in % 



Performance per Share 



Consolidated balance sheet 

In USD m 2007/08 2008/09 2009/10 2010/11 2011/12e 2012/13e 2013/14e 

Assets 

Goodwill and other intangible assets 103 105 100 103 128 128 128 

thereof other intangible assets 11 11 10 12 25 25 25 

thereof Goodwill 92 94 90 91 103 103 103 

Property, plant and equipment 56 56 53 66 74 79 85 

Financial assets 0 0 0 0 14 14 14 

Other long-term assets 6 15 18 18 -6 4 3 

Fixed assets 166 175 171 187 210 224 229 

Inventories 153 136 152 189 202 185 197 

Accounts receivable 118 79 98 119 105 119 127 

Liquid assets 116 119 116 130 111 145 167 

Other short-term assets 19 20 22 29 29 26 18 

Current assets 406 355 387 467 447 475 509 

Total Assets 584 540 558 654 657 699 738 

Liabilities and shareholders' equity 

Subscribed capital 0 0 0 0 0 0 0 

Capital reserve 189 196 205 218 223 228 233 

Retained earnings 294 304 333 394 426 466 516 

Other equity components -82 -82 -125 -138 -149 -166 -173 

Shareholder's equity 402 418 414 474 500 529 572 

Minority interest 2 3 4 5 5 5 8 

Total equity 405 422 417 479 505 534 580 

Provisions 75 63 80 101 96 103 107 

thereof provisions for pensions and similar obligations 12 17 18 18 18 19 20 

Financial liabilites (total) 67 31 21 23 16 16 16 

thereof short-term financial liabilities 55 19 5 8 10 10 10 

Accounts payable 21 13 23 27 27 26 28 

Other liabilities 18 10 17 24 22 24 15 

Liabilities 181 118 141 175 160 170 166 

Total liabilities and shareholders' equity 584 540 558 654 657 699 738 


2007/08 2008/09 2009/10 2010/11 2011/12e 2012/13e 2013/14e 

Efficiency of Capital Employment 

Operating Assets Turnover n.a. n.a. n.a. n.a. n.a. n.a. n.a. 

Capital Employed Turnover 1.2 x 0.7 x 0.9 x 1.2 x 1.0 x 1.0 x 1.0 x 

ROA 39.2 % 5.2 % 17.5 % 32.2 % 13.7 % 17.6 % 22.0 % 

Return on Capital 

ROCE n.a. 1.1 % 6.3 % 12.0 % 5.5 % 7.3 % 8.6 % 

ROE 15.3 % 2.2 % 7.2 % 13.5 % 5.9 % 7.7 % 9.1 % 

Adj. ROE 15.3 % 2.2 % 7.2 % 13.5 % 5.9 % 7.7 % 9.1 % 

Balance sheet quality 

Net Debt -38 -70 -77 -90 -77 -110 -131 

Net Financial Debt -50 -88 -96 -108 -95 -129 -151 

Net Gearing -9.3 % -16.7 % -18.6 % -18.8 % -15.3 % -20.6 % -22.6 % 

Net Financial Debt / EBITDA -41.7 % -415.7 % -172.0 % -111.2 % -161.2 % -175.9 % -169.4 % 

Book Value / Share 13.2 14.3 14.2 16.3 16.9 17.8 19.3 

Book value per share ex intangibles 9.8 10.7 10.7 12.8 12.6 13.5 15.0 

ROCE Development 


Net debt 

in EUR m 



Book Value per Share 

in EUR 



Consolidated cash flow statement 

In USD m 2007/08 2008/09 2009/10 2010/11 2011/12e 2012/13e 2013/14e 

Net income 64 9 30 61 30 41 51 

Depreciation of fixed assets 16 9 9 10 11 12 12 

Amortisation of goodwill 0 0 0 0 0 0 0 

Amortisation of intangible assets 7 4 2 3 2 2 2 

Increase/decrease in long-term provisions 1 -17 18 18 -5 7 4 

Other non-cash income and expenses -2 22 -14 -15 -10 -10 -10 

Cash Flow 86 27 47 77 28 51 60 

Increase / decrease in inventory -15 21 -21 -28 -13 17 -12 

Increase / decrease in accounts receivable -12 39 -23 -23 14 -14 -8 

Increase / decrease in accounts payable 2 -9 11 3 -1 0 2 

Increase / decrease in other working capital positions -28 -22 24 21 0 0 0 

Increase / decrease in working capital -53 28 -10 -27 1 3 -18 

Net cash provided by operating activities 33 55 37 50 31 45 35 

Investments in intangible assets 0 0 0 0 0 0 0 

Investments in property, plant and equipment 14 8 9 22 16 17 18 

Payments for acquisitions 30 12 1 11 25 0 0 

Financial investments 129 2 11 9 14 9 10 

Income from asset disposals 225 4 13 13 10 10 10 

Net cash provided by investing activities -52 18 8 29 45 16 18 

Change in financial liabilities 25 -36 -10 -3 -7 0 0 

Dividends paid 0 0 0 0 0 0 0 

Purchase of own shares -120 0 -19 -9 0 0 0 

Capital measures 5 0 3 7 5 5 5 

Others 0 0 0 0 -1 0 0 

Net cash provided by financing activities -90 -36 -27 -5 -3 5 5 

Change in liquid funds -6 2 2 17 -16 34 22 

Effects of exchange-rate changes on cash 2 0 -7 0 0 0 0 

Cash and cash equivalent at end of period 114 116 111 127 111 145 167 


2007/08 2008/09 2009/10 2010/11 2011/12e 2012/13e 2013/14e 

Cash Flow 

Free Cash Flow 85 37 29 21 -14 29 17 

Free Cash Flow / Sales 3.1 % 13.6 % 6.7 % 4.7 % 2.9 % 5.0 % 2.8 % 

Free Cash Flow Potential 76 18 36 65 35 46 57 

Free Cash Flow / Sales 3.1 % 13.6 % 6.7 % 4.7 % 2.9 % 5.0 % 2.8 % 

Free Cash Flow / Net Profit 27.9 % 519.6 % 94.6 % 47.0 % 53.5 % 70.6 % 34.3 % 

Interest Received / Avg. Cash 3.1 % 1.2 % 0.5 % 0.7 % 0.7 % 0.6 % 0.5 % 

Interest Paid / Avg. Debt 4.3 % 3.6 % 3.7 % 3.4 % 4.1 % 4.9 % 4.9 % 

Management of Funds 

Investment ratio -2.5 % -2.2 % -2.0 % -3.6 % -3.1 % -3.0 % -2.9 % 

Maint. Capex / Sales 1.5 % 1.5 % 1.5 % 1.5 % 1.5 % 1.5 % 1.5 % 

Capex / Dep -62.6 % -60.0 % -74.0 % -167.2 % -118.5 % -121.4 % -124.1 % 

Avg. Working Capital / Sales n.a. n.a. n.a. n.a. n.a. n.a. n.a. 

Trade Debtors / Trade Creditors 556.8 % 603.7 % 421.3 % 440.9 % 396.2 % 452.5 % 453.6 % 

Inventory Turnover 2.1 x 1.6 x 1.7 x 1.9 x 1.6 x 1.9 x 1.9 x 

Receivables collection period (days) 75 83 84 73 74 78 76 

Payables payment period (days) 24 22 33 27 29 28 27 

Cash conversion cycle (Days) n.a. n.a. n.a. n.a. n.a. n.a. n.a. 

CAPEX and Cash Flow 

in EUR m 


Free Cash Flow Generation 



Working Capital 



LEGAL DISCLAIMER 

This research report was prepared by the Warburg Research GmbH, a subsidiary of the M.M.Warburg & CO KGaA and is passed on 

by the M.M.Warburg & CO KGaA. It contains selected information and does not purport to be complete. The report is based on 

publicly available information and data ("the information") believed to be accurate and complete. Warburg Research GmbH neither 

does examine the information to be accurate and complete, nor guarantees its accuracy and completeness. Possible errors or 

incompleteness of the information do not constitute grounds for liability of M.M.Warburg & CO KGaA or Warburg Research GmbH for 

damages of any kind whatsoever, and M.M.Warburg & CO KGaA and Warburg Research GmbH are not liable for indirect and/or direct 

and/or consequential damages. In particular, neither M.M.Warburg & CO KGaA nor Warburg Research GmbH are liable for the 

statements, plans or other details contained in these analyses concerning the examined companies, their affiliated companies, 

strategies, economic situations, market and competitive situations, regulatory environment, etc. Although due care has been taken in 

compiling this research report, it cannot be excluded that it is incomplete or contains errors. M.M.Warburg & CO KGaA and Warburg 

Research GmbH, their shareholders and employees are not liable for the accuracy and completeness of the statements, estimations 

and the conclusions derived from the information contained in this document. Provided a research report is being transmitted in 

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and Warburg Research GmbH shall be restricted to gross negligence and wilful misconduct. In case of failure in essential tasks, 

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Warburg Research GmbH or affiliated companies may serve in a position of responsibility, i.e. on the board of directors of companies 

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prohibited and punishable. This applies, in particular, to reproductions, translations, microfilming, and storage and processing on 

electronic media of the entire content or parts thereof. 

DISCLOSURE ACCORDING TO § 34B OF THE GERMAN SECURITIES TRADING ACT AND FINANV 

The valuation underlying the rating of the company analysed in this report is based on generally accepted and widely used methods of 

fundamental valuation, such as the DCF model, Free Cash Flow Value Potential, peer group comparison and – where applicable – a 

sum-of-the-parts model. 

M.M.Warburg & CO KGaA and Warburg Research GmbH have set up internal organisational and administrative arrangements to 

prevent and avoid possible conflicts of interest and, where applicable, to disclose them. 

Valuations, ratings and price targets for the companies analysed by Warburg Research GmbH are subject to constant reviews and 

may therefore change, if any of the fundamental factors underlying these items do change. 

All share prices given in this equity analysis are closing prices on the date given in the analysis, except where stated otherwise. 

Neither Warburg Research GmbH’s analysts nor M.M.Warburg & CO KGaA’s analysts do receive any payments directly or indirectly 

from any investment banking activity of M.M.Warburg Bank or an affiliated company. 

M.M.Warburg & CO KGaA and Warburg Research GmbH are under supervision of the BaFin – German Federal Financial Supervisory 

Authority. 

SOURCES 

All data and consensus estimates have been obtained from FactSet except where stated otherwise. 



Section 34b of the German Securities Trading Act in combination with the FinAnV requires an enterprise preparing a 

securities analysis to point out possible conflicts of interest with respect to the company that is the subject of the analysis. 

A conflict of interest is assumed, in particular, when the enterprise preparing the analysis … 

-1- … or companies affiliated with this enterprise holds 5% or more of the share capital of the analysed company 

-2- 

-3- 

-4- 

… or companies affiliated with this enterprise was a member in a consortium which acquired the shares of the 

analysed company within the last twelve months 

… or companies affiliated with this enterprise manages the securities of the analysed company on the basis of 

an existing contract 

… or companies affiliated with this enterprise over the previous 12 months has been providing investment 

banking services for the analysed company for which a compensation has been or will be paid 

-5- … effected an agreement with the analysed company for the preparation of the financial analysis 

-6- … or companies affiliated with this enterprise regularly trade in shares or derivatives of the analysed company 

-7- 

… or the analyst responsible for this company has other important financial interests in relation to the analysed 

company such as e.g. the performance of mandates for the analysed company 

Company Disclosure Link to the historical price targets and rating changes (last 12 months) 

Rofin-Sinar 3, 6 http://www.mmwarburg.com/disclaimer/disclaimer_en/US7750431022.htm 



INVESTMENT RECOMMENDATION 

Investment recommendation: expected direction of the share price development of the financial instrument up to the given price target 

in the opinion of the analyst who covers this financial instrument. 

-B- Buy: The price of the analysed financial instrument is expected to rise over the next 12 months. 

-H- Hold: 

The price of the analysed financial instrument is expected to remain mostly flat over the 

next 12 months. 

-S- Sell: The price of the analysed financial instrument is expected to fall over the next 12 months. 

“-“ Rating suspended: The available information currently does not permit an evaluation of the company. 

WARBURG RESEARCH GMBH – RESEARCH UNIVERSE BY RATING 

Rating Number of stocks % of Universe 

Buy 113 60 

Hold 62 33 

Sell 9 5 

Rating suspended 4 2 

Total 188 100 

WARBURG RESEARCH GMBH – ANALYSED RESEARCH UNIVERSE BY RATING … 

… Looking only at companies for which a disclosure according to § 34b of the Germany Securities Trading Act and the 

FinAnV has to be made. 

Rating Number of stocks % of Universe 

Buy 99 65 

Hold 45 30 

Sell 5 3 

Rating suspended 3 2 

Total 152 100 

PRICE AND RATING HISTORY ROFIN-SINAR AS OF 03.08.2012 


The chart has markings if Warburg Research GmbH 

changed its rating in the last 12 months. Every marking 

represents the date and closing price on the day of the 

rating change.


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