Conference Call on Q November 6, 2018

Transcription

1 Conference Call on Q November 6, 2018

2 Q Headlines Top line growth of +0.5% to EUR million, organically up by +5.3% EBIT pre PPA at EUR 23.8 million, EBIT margin pre PPA at 5.9% Solid order book ensures future growth: order intake of EUR 412 million (+8%) and order backlog with EUR 1,027 million again at a high level Sharpening the focus in the area of fuel cell technology Future emphasis on PEM low-temperature fuel cell systems used in mobile applications Interests in new enerday GmbH sold to Dresden-based sunfire GmbH Successful closing effective from September 30, 2018 External and internal factors are weighing on ElringKlinger market environment still characterized by uncertainties Updated guidance for FY 2018 confirmed Conference Call Q November 6,

3 Status quo A number of external and internal factors External Ongoing accusations of fraud as well as discussions about diesel bans in cities WLTP impact in Europe, esp. Germany International trade disputes US tariffs on steel and aluminum Surging raw material prices Risk of market decline in China Internal High follow-on costs in NAFTA region due to continuously high demand Cost optimization potential at Swiss location (to be finalized by end of 2019) Conference Call Q November 6,

4 Markets European auto market particularly impacted by WLTP Production Light Vehicles Q3 2018/Q in % China Trade conflict and tariffs start to show negative effects on new registrations Production volumes still strong, but demand becoming slower and weakening expected going forward European Union Introduction of WLTP leads to decreasing production volumes, especially in Germany (-13%) France and Spain growing UK and Italy down North America Slight growth on high prior-year level Ongoing strong demand for SUVs +11% -1% +2% Japan Production fell short again after a year of recovery India Growth on more normalized level after pre-emptive effects in Q2 due to looming tax increase in H2 Brazil Ongoing strong market development on low levels -5% +9% +10% Source: PWC Autofacts, ElringKlinger research Conference Call Q November 6,

5 Financials

6 Q Sales expand by 5.3% organically Order intake in EUR million % (FX adj.: +11.5%) Order backlog in EUR million 977 1, % (FX adj.: +6.6%) 1,027 1,038 1,027 Q Q4 Q1 Q2 Q Q Q4 Q1 Q2 Q Sales in EUR million +0.5% Sales in EUR million +0.5% % % % Q Q4 Q1 Q2 Q Q FX M&A Organic Q Conference Call Q November 6,

7 Q Earnings still affected by high NAFTA demand and raw material prices EBITDA in EUR million % Q Q4 Q1 Q2 Q EBIT pre PPA in EUR million % % 38.4 Oneoff Hug 17.3 Q Q4 Q1 Q % Q EBIT margin pre PPA (Q1 adjusted for one-off) Net income (attr. to shareholders) in EUR million Earnings per share in EUR -32.9% % Q Q4 Q1 Q2 Q Q Q4 Q1 Q2 Q Conference Call Q November 6,

8 Q Comprehensive measures in NAFTA region start to unfold ElringKlinger NAFTA sales in EUR million (left-hand side) LV production NAFTA in thousand units (right-hand side) ,000 4,500 0 Q Q Q Q Q Q [ ] 0 Production Installation of additional production lines Logistics Personnel Optimization of logistics processes Hiring additional personnel and implementing trainings programs Sales Gradual adjustment of product prices EBIT improvement due to enhanced execution Cost Optimizing fixed cost base Conference Call Q November 6,

9 Q Global sales split reflecting strong growth in NAFTA region Sales by region in EUR million resp. in % South America/Rest of World 18.9 Asia-Pacific % (20%) 5% (5%) 25% (26%) Germany NAFTA % (20%) 28% (29%) Rest of Europe Previous year s Q3 figures in brackets Conference Call Q November 6,

10 Q OE: Lightweighting division increases sales share Sales by segment in EUR million Share of total sales in % Aftermarket 37.6 (40.2) 9% (10%) 5 Engineered Plastics 30.2 (28.9) 7% (7%) Services 2.3 (2.4) 1% (1%) Industrial Parks 1.0 (1.0) <1% (<1%) Original Equipment (OE) (331.1) 83% (82%) Cylinder-Head Gaskets: 12% (12%) Specialty Gaskets: 19% (18%) Lightweighting/Elastomer: 27% (24%) Shielding Technology: 23% (24%) Exhaust Gas Purification: 1% (3%) E-Mobility: 1% (1%) Other OE business: <1% (<1%) Previous year s Q3 figures in brackets Conference Call Q November 6,

11 Segments Strong performance by Engineered Plastics Sales in EUR million EBIT margin in % Original Equipment (OE) Aftermarket +1.1% -6.5% Q Q4 Q1 Q2 Q Q Q4 Q1 Q2 Q Engineered Plastics Services & Industrial Parks +4.5% Industrial Parks Services Q Q4 Q1 Q2 Q Q Q4 Q1 Q2 Q Conference Call Q November 6,

12 Q Continued disciplined capex approach despite increase in Q3 Net working capital in EUR million Capex (in PPE) in EUR million % % Q Q4 Q1 Q2 Q Q Q4 Q1 Q2 Q Operating free cash flow in EUR million Net financial debt in EUR million +47.6% +13.1% Q Q4 Q1 Q2 Q Q Q4 Q1 Q2 Q Conference Call Q November 6,

13 Balance sheet Well-balanced debt structure Net financial debt in EUR million Maturity structure of financial debt in EUR million +11.1% Current financial debt Non-current financial debt Dec. 31, Sep. 30, 2018 Cash and cash equivalents Cash and Credit cash lines equivalents unused Credit lines used Current (2018/19) Noncurrent ( ) Noncurrent (beyond 2023) Conference Call Q November 6,

14 Strategic remarks

15 Group strategy ElringKlinger s sales structure of products will change Sales split (actual and ambition) in % of total sales Actual 2017 Ambition 2030 Structural lightweight and e-mobility products Aftermarket 4% Non-Automotive products 9% 5% Aftermarket Non-Automotive products ~10% ~10% 82% Functional components Structural lightweight and e-mobility products >25% <55% Functional components Conference Call Q November 6,

16 Group strategy Nominated e-mobility volumes create a healthy basis for future sales Nominated volumes* in EUR million 1,000 ~10% ~20% ~10% ~30% ~10% ~30% Strong growth particularly in the battery business Acceleration especially after ramp-up year 2019 ~20% ~20% ~60% ~70% ~60% ~60% Includes systems as well as components nominations by different OEMs worldwide 2019e 2020e 2021e 2022e 2023e EDU Fuel cell systems Battery systems and components * Scheduled revenues in e-mobility products according to received OEM nomination letters, final revenues dependent on definitely called volumes Conference Call Q November 6,

17 Group strategy Generating future growth in new business areas Battery systems Fuel cell systems Electric drive unit Structural lightweighting Established e-mobility supplier due to series orders for cell contacting systems Cooperation with battery manufacturers Next step: industrialization PEM fuel cell stack ready for marketing Components available as well Next step: installation of automated production line Strategic minority stake in engineering service provider hofer powertrain Next step: small series production Unique production technology Launching order in full-delivery phase, further contracts ramping up Next step: further ramp-up of new contracts Focused capex spending Strong growth of e-mobility areas from 2020/21 on with lightweighting further ramping up Conference Call Q November 6,

18 Group strategy Managing the growth in classical business areas Cylinder-head gaskets Specialty gaskets Shielding technology Plastic housing modules Strong market positions associated with technological niches Benefitting from global production network Utilizing profound and detailed product and process know-how Concentrating on improved processes to avoid additional costs Optimizing inventories Reducing financial debt Disciplined investments for managing the growth Stable growth path of sales according to market development Conference Call Q November 6,

19 Outlook

20 Expectations for 2018 Global production growth expected to slow down due to weaker H2 Light vehicle production growth in % vs % NAFTA Rising truck market LV market flat on high level +10% South America Low basis Turnaround achieved +1% Europe WLTP impact in Germany Growth in Spain and France UK down +1-2% Global Slight growth to be expected Supported by Europe, India and China +2% Asia-Pacific Slowdown in China Upturn in India Japan taking a breather Source: PWC Autofacts, OICA, JP Morgan, ElringKlinger research Conference Call Q November 6,

21 Group Outlook Mid-term 2 4 percentage points above global market growth Organic sales Above global market growth ~ 7% EBIT margin pre PPA Successive improvement Conference Call Q November 6,

22 Group Further indicators for FY 2018 FY 2017 actual FY 2018 updated ROCE in % 8.2% Slightly below prior-year level Mid-term Increasing based on earnings and NWC improvements R&D costs in % of total sales 4.6% ~ 5-6% ~ 5-6% Capex (in PPE) in % of total sales 9.3% ~ 9-10% Continuation at comparable level Net working capital (NWC) in % of total sales 33.3% Slightly above prior-year level Operating FCF in EUR million Slightly below prior-year level Slight step-by-step improvement Steady improvement Equity ratio in % of total assets % Continuation at comparable level Conference Call Q November 6,

23 Q&A

24 Appendix

25 Group Consolidated statement of financial position Assets As at Sept 30, 2018 As at Dec 31, 2017 Intangible assets Property, plant, and equipment Investment property Financial assets 3 1 Shares in associates Non-current income tax assets 0 0 Other non-current assets 4 4 Deferred tax assets Contract performance costs 3 0 Non-current contract assets 1 0 Non-current assets 1,237 1,188 Inventories Current contract assets 5 0 Trade receivables Current income tax assets 8 7 Other current assets Cash and cash equivalents Current assets Assets held for sale 0 62 Total assets 2,087 2,022 Liabilities and equity As at Sept 30, 2018 As at Dec 31, 2017 Share capital Capital reserves Revenue reserves Other reserves Equity attr. to shareh. of ElringKlinger AG Non-controlling interest in equity Equity Provisions for pensions Non-current provisions Non-current financial liabilities Deferred tax liabilities Other non-current liabilities 3 4 Non-current liabilities Current provisions Trade payables Current financial liabilities Tax payable Other current liabilities Current liabilities Liabilities in connection with assets held for sale 0 24 Total liabilities and equity 2,087 2,022 All figures in EUR million unless otherwise describe, differences due to rounding Conference Call Q November 6,

26 Group Income statement Q Q Sales revenue Cost of sales Gross profit Gross margin (in %) Selling expenses General and administrative expenses Research and development costs Other operating income 5 3 Other operating expenses -2-3 Operating result (EBIT) EBIT margin (in %) Finance income 7 6 Finance costs Share of result of associates 0 0 Net finance costs -1-8 Earnings before taxes Income tax expense Net income of which: attributable to non-controlling interests 2 1 of which: attributable to shareholders of ElringKlinger AG Basic and diluted earnings per share (in EUR) All figures in EUR million unless otherwise describe, differences due to rounding Conference Call Q November 6,

27 Group Consolidated statement of cash flows Q Q Earnings before taxes (EBT) Depreciation/amortization (less write-ups) of non-current assets Net interest Change in provisions Gains/losses on disposal of non-current assets Share of result of associates Change in inventories, trade receivables and other assets not resulting from financing and investing activities Change in trade payables and other liabilities not resulting from financing and investing activities Income taxes paid Interest paid Interest received 0 0 Other non-cash expenses and income Net cash from operating activities Q Q Proceeds from disposals of PPE, intangible assets and investment property Proceeds from disposals of financial assets Payments received for the disposal of subsidiaries 1 0 Payments for investm. in intangible assets Payments for investments in PPE and investment property Payments for investments in financial assets Net cash from investing activities Dividends paid to shareholders and to noncontrolling interests Proceeds from addition of financial liabilities Payments for the repayment of financial liabilities Changes in current loans Net cash from financing activities Changes in cash Effects of currency exchange rates on cash Cash at beginning of the period Cash at end of period All figures in EUR million unless otherwise describe, differences due to rounding Conference Call Q November 6,

28 Q Key figures Q Q D abs. D rel. Order intake % Order backlog 1, % Sales % EBITDA % EBIT pre PPA % EBIT margin pre PPA (in %) pp - EBIT (reported) % EBT % Net income attributable to shareholders % Earnings per share (in EUR) % Capex (in PPE) % Operating free cash flow % Net working capital % Equity ratio (in %) pp - Net financial debt % Employees (as at quarter-end) 10,231 9, % All figures in EUR million unless otherwise described Conference Call Q November 6,

29 Last 5 quarters Key figures Q Q Q Q Q Order intake Order backlog 1,027 1,038 1,027 1, Sales EBITDA EBIT pre PPA EBIT margin pre PPA (in %) EBIT (reported) EBT Net income attributable to shareholders Earnings per share (in EUR) Capex (in PPE) Operating free cash flow Net working capital Equity ratio (in %) Net financial debt Employees (as at quarter-end) 10,231 9,954 9,618 9,611 9,376 All figures in EUR million unless otherwise described Conference Call Q November 6,

30 Last 5 quarters Segmental figures Q Q Q Q Q Group Sales EBIT (reported) EBIT margin (in %) Original Equipment Sales EBIT (reported) EBIT margin (in %) Aftermarket Sales EBIT (reported) EBIT margin (in %) Engineered Plastics Sales EBIT (reported) EBIT margin (in %) Services Sales EBIT (reported) EBIT margin (in %) Industrial Parks Sales EBIT (reported) EBIT margin (in %) Conference Call Q November 6,

31 IR calendar and contact Date Event Mar 27, 2019 Annual Report 2018 May 7, 2019 Q May 16, 2019 Annual General Meeting From left to right: Heiderose Mall, Christoph Staib, Kathrin Graf (on maternity leave), Sabrina Haufler, Dr. Jens Winter ElringKlinger AG Strategic Communications Max-Eyth-Str Dettingen/Erms Germany E: investor-relations@elringklinger.com Investor contacts Dr. Jens Winter Head of Strategic Communications E: jens.winter@elringklinger.com T: M: Sabrina Haufler Senior Manager Strategic Communications E: sabrina.haufler@elringklinger.com T: M: Conference Call Q November 6,

32 Disclaimer Forward-looking statements and predictions This presentation contains statements about the future. These statements are based on current expectations, market evaluations and predictions by the Management Board, and on information that is currently available to them. The statements about the future should not be interpreted as guarantees of the future developments and results that they refer to. Whilst the Management Board is convinced that the statements that have been made, and the convictions and expectations on which they are based, are realistic, they rely on suppositions that may conceivably prove to be incorrect; future results and developments are dependent on a multitude of factors, they involve various risks and imponderabilities that can affect whether the ongoing development deviates from the expectations that have been expressed. These factors include, for example, changes to the general economic and business situation, variations of exchange rates and interest rates, poor acceptance of new products and services, and changes to business strategy. Conference Call Q November 6,