Voith Group New growth with expertise for the digital industry

Transcription

1 voith.com Voith Group New growth with expertise for the digital industry Stuttgart Dec. 6, 2018

2 Your contact Dr. Toralf Haag President & CEO and CFO Dr. Roland Münch Member of the Corporate Board of Management and President & CEO of Digital Ventures Press briefing Dr. Toralf Haag public 2

3 Contents 1. Where we are today 1.1 Highlights of the 2017/18 fiscal year 1.2 Financial performance indicators for the 2017/18 fiscal year 2. Our plans 2.1 Strategic outlook: our growth agenda 2.2 Operating outlook: the 2018/19 fiscal year Press briefing Dr. Toralf Haag public 3

4 2017/18 fiscal year Financial basis strengthened, important milestones reached Sound growth in the operating business Further financial strength achieved. Group structure streamlined Increase in power and efficiency within the Voith organization. Digital agenda advanced First market successes apparent. Core business robust Market positions further improved thanks to innovations. Press briefing Dr. Toralf Haag public 4

5 1. Sound growth in the operating business Further financial strength achieved Group s orders received and sales higher after adjustment for currency effects, weaker performance by Hydro prevents stronger growth. Operating result of the core business robust despite currency effects and Hydro s weakness, adjusted group net result risen perceptibly. Voith s financial position remains excellent, equity ratio at an all-time high. Press briefing Dr. Toralf Haag public 5

6 2. Group structure streamlined Increase in power and efficiency Reduction in the number of legal entities in Germany from 70 to around 15 implemented over only a few months. Simplification of the structures means less bureaucracy, a more rapid response and more efficiency. Comparable reorganization of the legal structures also outside of Germany under review. Press briefing Dr. Toralf Haag public 6

7 3. Digital agenda advanced Profile of Digital Ventures sharpened Sales-focused structure in order to generate even greater momentum for the Group. Bringing together all digital start-up activities under the umbrella of Digital Ventures (previously: Digital Solutions). Oversight of new venture activities and function as incubator for new, digital business models in all areas of the Voith Group. Support for the activities of the core businesses to refine their portfolios in the digital realm. Press briefing Dr. Toralf Haag public 7

8 3. Digital Agenda advanced First market successes apparent Industrial Internet-of-Things data platform OnCumulus taken to market maturity first market successes achieved. Extensive portfolio of smart digital solutions to improve the performance of hydropower plants developed and placed on the market. Joint venture Voith Robotics and cooperation with Franka Emika open up new potential in the strongly growing market for lightweight robot systems. Press briefing Dr. Toralf Haag public 8

9 4. Core business in robust condition Market positions improved thanks to innovations Innovative StreamDiver technology for small hydropower plants established at an international level. Expertise as a full-line supplier pays off: first complete production line for the manufacture of corrugated medium sold in the USA. Voith benefits from the e-mobility megatrend: innovative electric drive system for buses successfully launched on the market. Press briefing Dr. Toralf Haag public 9

10 Where we are today Conclusion Voith enjoyed sound growth in the 2017/18 fiscal year on a currencyadjusted basis in a challenging environment. The core business of the Voith Group is in a robust condition despite the temporary weakness at Hydro and in a good position for a positive development over the long term. Digital Ventures is growing and is developing an increasing momentum that will benefit the entire Voith Group. Voith is distinguishing itself by actively shaping the digital transformation. We are systematically building up a network of expertise for digital industry and are thus tapping into new growth potential. Press briefing Dr. Toralf Haag public 10

11 Contents 1. Where we are today 1.1 Highlights of the 2017/18 fiscal year 1.2 Financial performance indicators for the 2017/18 fiscal year 2. Our plans 2.1 Strategic outlook: our growth agenda 2.2 Operating outlook: the 2018/19 fiscal year Press briefing Dr. Toralf Haag public 11

12 Group orders received High level orders on hand remain in excess of 5 billion Orders received Group in millions 4,367 4, / /18 Orders received Group ( 4,285 million) by Group Division (rounded) Voith Turbo 32% Voith Hydro 20% Adjusted for currency effects, orders received increased by 2%, slight decrease depending on currency. Heterogeneous picture in the Group Divisions: strong growth at Paper and slight growth at Turbo just about balance out appreciable decrease at Hydro. At 5.17 billion, orders on hand remain high (previous year: 5.19 billion). Voith Paper 47% Press briefing Dr. Toralf Haag public 12

13 Group sales Currency-adjusted rise by 4% Sales Group in millions 4,224 4, / /18 Considerable currency effects and Hydro s failure to meet targets prevent stronger growth. After currency effects, slight decrease in Group s sales. Sales Group ( 4,209 million ) by Group Division (rounded) Voith Turbo 31% Voith Hydro 26% Voith Paper 42% Press briefing Dr. Toralf Haag public 13

14 Operating result Robust performance in the core business Profit from operations of the core business in million = profit from operations of the three Group Divisions on aggregate Hydro Paper Turbo / /18 254* * / / Comparison profit from operations Group/core business in millions = profit from operations Group Aggregate result of the three core businesses down on previous year primarily on account of unexpectedly weaker development at Hydro. In total, core business remains robust, however, with a very good performance at Paper and a sound one at Turbo. In the current fiscal year, change in central operating performance indicator: EBIT in the future instead of profit from operations with minor effects overall. * Without discontinued operations; previous-year figure restated. Press briefing Dr. Toralf Haag public 14

15 Group net result Appreciable rise Group net result* in millions / /18 * Without discontinued operations. Previous year additionally adjusted for effect on results from sale of the KUKA shareholding. Group net result increased by 61%, adjusted for KUKA effect in the previous year. Improvement mainly driven by interest and tax effects (specifically use of previously unused tax losses thanks to improved earnings situation). Press briefing Dr. Toralf Haag public 15

16 Hydro Weaker than anticipated but remains in a good position in a challenging environment Press briefing Dr. Toralf Haag public 16

17 Hydro Financial performance indicators weaker than expected Sales in millions 1,381 Orders received in millions 1,103 1, Failure to meet targets on account of delays in construction work for some major contracts and delays in projects being awarded. 2016/ / / /18 In addition, considerable burden from negative currency effects. Profit from operations in millions / /18 Employees 4,507 3, Orders received, sales and results below targets and below previous year. Weakness only temporary, prospects for rapid recovery intact, large-volume orders the offer pipeline. Press briefing Dr. Toralf Haag public 17

18 Paper Success story continues Press briefing Dr. Toralf Haag public 18

19 Paper Very good fiscal year with figures at new highs Sales in millions 1, / /18 Profit from operations in millions 107 1, Orders received in millions Employees 1,813 1, / /18 6,449 6,618 Targets exceeded despite considerable negative currency effects: Paper returns to being a sustainably strengthened pillar of the Group following its successful turnaround. Central performance indicators up on the high previous-year figures: orders received, sales and result further increased. 2016/ / Press briefing Dr. Toralf Haag public 19

20 Turbo Robust development in demanding markets Press briefing Dr. Toralf Haag public 20

21 Turbo Stable operating performance Sales in millions Orders received in millions 1,283 1,302 1,344 1, / / / /18 Sales and orders received slightly increased despite negative currency effects. Build-up costs for planned joint venture in China push result slightly below the high level seen in the previous year. Profit from operations in millions Employees 5,408 5, / / Press briefing Dr. Toralf Haag public 21

22 Digital Ventures Start-up momentum building up Press briefing Dr. Toralf Haag public 22

23 Digital Ventures Strong sales growth and negative operating result reflect the start-up character of the Group Division Sales in millions 40 Sales growth mainly driven by first-time full consolidation of Ray Sono and Flow Link / /18 Profit from operations in millions 2016/ /18 Scheduled increase to around 2,250 employees and high level of development expense for new digital applications. Slight increase in shortfall seen as conscious investment in future growth potential Once again more than 200 million sales generated in the core business Group Divisions with the assistance of the digital segment. Press briefing Dr. Toralf Haag public 23

24 Research & development More than 1 billion invested over 5 years Expenses for F&E in millions / /18 R&D to sales ratio in percent / /18 With a portfolio of more than 4,000 active patents, the Group is one of the most innovative companies in its sector. Another increase in R&D expenditure in the past year and higher R&D to sales ratio driven primarily by Digital Ventures. Press briefing Dr. Toralf Haag public 24

25 Balance sheet ratios Voith Group financially strong Equity ratio in percent Net liquidity in millions At end of year under review / /18 Thanks to reduction in debt, equity ratio at historical high. Net liquidity still remains at a very comfortable level. Voith has considerable funds at its disposal to finance organic growth and acquisitions Press briefing Dr. Toralf Haag public 25

26 2017/18 financial performance indicators Conclusion On a currency-adjusted basis, sound growth in orders received and sales within the Group, currency effects and weak development at Hydro prevent stronger growth. Operating result robust, Group net result appreciably higher due to structural improvements. The Voith Group is in a better financial position than ever before with an equity ratio at a historically strong level and an ongoing high level of net liquidity. This means that Voith has the necessary financial strength to make powerful investments in the next phase of its development. Press briefing Dr. Toralf Haag public 26

27 Contents 1. Where we are today 1.1 Highlights of the 2017/18 fiscal year 1.2 Financial performance indicators for the 2017/18 fiscal year 2. Our plans 2.1 Strategic outlook: our growth agenda 2.2 Operating outlook: the 2018/19 fiscal year Press briefing Dr. Toralf Haag public 27

28 Our strategic agenda By 2025, Voith will be distinctly larger and more profitable than today Sales target: sustainable higher growth than the global economy 4.2 BEUR Today +X% Digital Organic Growth M&A 2025 Focus on the core business: tapping into potential for organic growth by expanding the service business, innovations in all Group Divisions and geographical expansion (e.g. Africa). Additional growth from digitalization: through start-up activities and new digital applications in all areas. Active M&A strategy: focus on supplements to existing activities but also opening up new areas. Voith has the financial strength to invest in organic growth AND acquisitions. Press briefing Dr. Toralf Haag public 28

29 Contents 1. Where we are today 1.1 Highlights of the 2017/18 fiscal year 1.2 Financial performance indicators for the 2017/18 fiscal year 2. Our plans 2.1 Strategic outlook: our growth agenda 2.2 Operating outlook: the 2018/19 fiscal year Press briefing Dr. Toralf Haag public 29

30 Outlook for 2019 Environment favorable overall for Voith Ongoing sound growth in the global economy expected, despite increasing geopolitical uncertainties Above-average growth in emerging markets, particularly in Asia, but increasingly also in Africa Robust growth in most of the leading industrialized countries Positive business environments in all key Voith markets Increasing energy needs driving demand in the field of energy generation Paper market continues to grow and support demand for paper machines Far-reaching transformation of mobility markets is opening up market opportunities Constantly increasing demand in all industries for digital solutions developed by Voith Press briefing Dr. Toralf Haag public 30

31 Outlook for 2019 Increased growth dynamics by increasing focus Concentration on strengthening the core business and defined focal points for growth is already starting in the current year; first visible effects anticipated in this context. Group s orders received expected to increase perceptibly driven not only by the digital activities but also by the three established Group Divisions. Group sales similarly anticipated to be up on previous year, specifically due to further development of the core business. Improvement in Group s EBIT, supported by all Group Divisions, expected. Profitability (ROCE) also expected to increase. Press briefing Dr. Toralf Haag public 31

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