Schaeffler Ag · XETR:SHA0
Schaeffler — Non-Deal Roadshow (March 2023)
51 slides from Schaeffler's roadshow presentation, Mar 9, 2023
Slide 1: Q4 and FY 2022 Schaeffler AG earnings
Q4 and FY 2022 Schaeffler AG earnings Deutsche Bank – Roadshow London March 9, 2023 London PUBLIC
Slide 2: Disclaimer
Disclaimer This presentation contains forward-looking statements. The words “anticipate”, “assume”, “believe”, “estimate”, “expect”, “intend”, “may”, “plan”, “project”, “should” and similar expressions are used to identify forward-looking statements. Forward-looking statements are statements that ar
Slide 3: Agenda
Agenda 1 Overview 2 Business Highlights Q4 and FY 2022 3 Financial Results Q4 and FY 2022 4 Outlook Mar 9, 2023 Deutsche Bank – Roadshow London 3 PUBLIC
Slide 4: Schaeffler Group with solid performance in FY 2022 – Cautious Outlook for 2023
1 Overview Schaeffler Group with solid performance in FY 2022 – Cautious Outlook for 2023 Key messages FY 2022 Sales FY EBIT FY2 FY Group sales1 +9.4% – Strong growth driven by positive volume and 1 price effects EUR 15.8 bn EUR 1,046 mn Business development – Record Order Intake in E-Mobility, robu
Slide 5: FY 2022 Guidance – Group metrics and divisional EBIT margins achieved
1 Overview FY 2022 Guidance – Group metrics and divisional EBIT margins achieved Group Results FY 2022 Divisional Results FY 2022 Automotive Automotive Industrial Technologies Aftermarket Guidance4 Actuals Guidance4 Actuals Guidance4 Actuals Guidance4 Actuals Sales growth1 6 - 8% 9.4% Outperf. Moder
Slide 6: Schaeffler Group FY 2022 – Highlights and lowlights
1 Overview Schaeffler Group FY 2022 – Highlights and lowlights Topline – Effective price recovery after successful Earnings quality – Current margin level not satisfying, negotiations across all divisions performance management will continue Structural measures – Implementation on track following Op
Slide 7: Agenda
Agenda 1 Overview 2 Business Highlights Q4 and FY 2022 3 Financial Results Q4 and FY 2022 4 Outlook Mar 9, 2023 Deutsche Bank – Roadshow London 7 PUBLIC
Slide 8: Automotive Technologies – Strong Outperformance in Q4, EBIT margin lower
2 Business Highlights Q4 and FY 2022 Automotive Technologies – Strong Outperformance in Q4, EBIT margin2 lower due to higher input costs Sales +7.7%1 Strong Outperformance of 830 bps in Q4 (FY: 150 bps), driven by Regions Europe in EUR mn 9,500 and Americas +10.0%1 8,436 2,150 2,430 Positive price e
Slide 9: Automotive Technologies – Strong Order Intake in FY 2022, E-Mobility reaching EUR 5 bn
2 Business Highlights Q4 and FY 2022 Automotive Technologies – Strong Order Intake in FY 2022, E-Mobility Order Intake reaching EUR 5 bn Order Intake1 Business Highlights in bn EUR Thereof 4.1 2.7 3.2 5.0 E-Mobility “Outstanding Contribution Award” 15.0 received from Geely for significant 12.3 capac
Slide 10: Automotive Technologies – Driving compelling investments and delivering innovation
2 Business Highlights Q4 and FY 2022 Automotive Technologies – Driving compelling investments and delivering innovation to our Customers Symposium in Bühl, Detroit, San Diego China: Majority of and Tokyo presenting nominated projects innovative solutions for application to from component to New Ener
Slide 11: Automotive Aftermarket – Strong growth in Q4, profitability to improve
2 Business Highlights Q4 and FY 2022 Automotive Aftermarket – Strong growth in Q4, profitability to improve Sales Strong Sales growth in Q4, driven by both price and volume – Strong performance in EUR mn +7.0%1 by the Independent Aftermarket business; all regions grew in Q4, in particular +16.6%1 1,
Slide 12: Automotive Aftermarket – How we win with future-ready business solutions
2 Business Highlights Q4 and FY 2022 Automotive Aftermarket – How we win with future-ready business solutions focused on our customers Market Drivers Future-ready business solutions Automotive Aftermarket ➔ Aftermarket pioneer for e-mobility repair solutions, e. g. launch of E-Axle repair • Continuo
Slide 13: REPXPERT and BILSTEIN partnership: Enhanced reach and quality of platform
2 Business Highlights Q4 and FY 2022 Automotive Aftermarket – SCHAEFFLER REPXPERT and BILSTEIN partnership: Enhanced reach and quality of platform Key aspects • Successful partnership with BILSTEIN on the REPXPERT Garage Portal further strengthened • REPXPERT attracts partners for Corporate cooperat
Slide 14: Industrial – Strong growth trajectory continued in Q4, EBIT margin flat
2 Business Highlights Q4 and FY 2022 Industrial – Strong growth trajectory continued in Q4, FY 2022 EBIT margin2 flat Sales Industrial with now seven consecutive quarters of growth – Strong contributions in EUR mn +14.7%1 across all regions and market clusters, especially from Greater China (+20.8%)
Slide 15: Industrial – Stabilisation of Orderbook trend; compelling acquisitions
2 Business Highlights Q4 and FY 2022 Industrial – Stabilisation of Orderbook trend in Q4; compelling acquisitions in 2022 in attractive verticals Orderbook 3-month Business Highlights 2 Orderbook 3M YOY growth % Sales 1 Cutting-edge product 40 technology for the high- 35 growth industrial robots 30
Slide 16: Industrial – How we harness secular trends in Renewables and Industrial Automation
2 Business Highlights Q4 and FY 2022 Industrial – How we harness secular trends and increasing opportunities in Renewables and Industrial Automation Renewable energy transition further accelerating Industrial Automation benefiting from key megatrends Favourable external environment Key megatrends •
Slide 17: Capital allocation – Investments increased in all regions
2 Business Highlights Q4 and FY 2022 Capital allocation – Investments increased in all regions Investment1 allocation | in EUR mn Key aspects Q4 2022 • Reinvestment Rate: Continued prioritization of investments in Industrial FY 20 FY 21 Q4 21 Q4 22 FY 22 division and New Business in Auto Tech; > 1.5
Slide 18: M&A – We continue to expand our ecosystem in a focused way
2 Business Highlights Q4 and FY 2022 M&A – We continue to expand our ecosystem in a focused way M&A Radar Collaborations and partnerships Automotive Hydrogen Power electronics & Electronics Mechatronics manufacturing and systems 1 Chassis 2 Rotative and linear Mechatronics components Lifetime Automo
Slide 19: Sustainability Update – Important milestones achieved in FY 2022
2 Business Highlights Q4 and FY 2022 Sustainability Update – Important milestones achieved in FY 2022 Sustainability Report 2022 Climate Targets validated CDP “A” Score for released by SBTi Climate and Water • 10 Action Fields along the dimensions of • Science Based Targets initiative (SBTi) • Impro
Slide 20: Agenda
Agenda 1 Overview 2 Business Highlights Q4 and FY 2022 3 Financial Results Q4 and FY 2022 4 Outlook Mar 9, 2023 Deutsche Bank – Roadshow London 20 PUBLIC
Slide 21: Sales – All divisions and regions, except Greater China, with double-digit growth in Q4
3 Financial Results Q4 and FY 2022 Sales – All divisions and regions, except Greater China, with double-digit growth in Q4 Sales | in EUR mn Key aspects +14.6%1 • Auto Technologies: Region China with -7% growth2 yoy as impacted by +11.8%2 Covid and vs. high comps; all other regions reaching double-d
Slide 22: Gross Profit – Positive volume and further improved pricing
3 Financial Results Q4 and FY 2022 Gross Profit – Positive volume and further improved pricing compensating for higher production costs Gross Profit Q4 2021 vs. Q4 2022 | in EUR mn Key aspects • Pricing: Further sequential improvement, mainly driven by price recovery measures in Automotive Technolog
Slide 23: Overhead costs – Cost ratio slightly below previous year
3 Financial Results Q4 and FY 2022 Overhead costs – Cost ratio slightly below previous year, continued high logistics costs Overhead costs | in EUR mn Key aspects • R&D: Slight increase to previous year, driven by investments in Robotics +11.5% and Hydrogen 648 • Selling: Increase yoy due to higher
Slide 24: Solid EBIT margin – All divisions impacted by higher input costs
3 Financial Results Q4 and FY 2022 Solid EBIT margin1 – All divisions impacted by higher input costs, despite successful price recovery EBIT1 | in EUR mn Key aspects • Accounting for collective agreement (“Inflationsausgleichsprämie”)2 in -1.6pp Germany, impacting Q4 margin with -0.6 %-pts; all divi
Slide 25: Automotive Technologies – Mixed Regional Outperformance in FY 2022
3 Financial Results Q4 and FY 2022 Automotive Technologies – Mixed Regional Outperformance in FY 2022, Q4 EBIT margin2 lower yoy Sales by business division | yoy growth EBIT2 Q4 2021 vs. Q4 2022 | in EUR mn Q4 2021 Q4 2022 ∆1 E-Mobility 306 357 +14.2% Engine & Transmission 1,189 1,302 +5.7% Bearings
Slide 26: Automotive Aftermarket – Strong growth in Europe and Asia-Pacific
3 Financial Results Q4 and FY 2022 Automotive Aftermarket – Strong growth1 in Europe and Asia-Pacific, EBIT margin5 on prior year level Sales by region | yoy growth EBIT5 Q4 2021 vs. Q4 2022 | in EUR mn Q4 2021 Q4 2022 ∆1 Europe 291 355 +22.5% -1 Americas 92 107 +3.0% Greater China 24 24 +2.1% Asia/
Slide 27: Industrial – Strong growth continued, EBIT margin lower yoy
3 Financial Results Q4 and FY 2022 Industrial – Strong growth1 continued, EBIT margin2 lower yoy Sales by region | yoy growth EBIT2 Q4 2021 vs. Q4 2022 | in EUR mn Q4 2021 Q4 2022 ∆1 Europe 401 449 +12.4% Americas 151 193 +15.2% -3 Greater China 226 277 +20.8% +16 -20 Asia/Pacific 140 147 +4.1% +11
Slide 28: Dividend – Proposed dividend EUR 45 cents, Payout Ratio 48%
3 Financial Results Q4 and FY 2022 Dividend – Proposed dividend EUR 45 cents1, Payout Ratio 48%2 Dividend and payout ratio2| in % Key aspects EUR per common non-voting share • EUR 45 cents1 dividend proposed (PY: EUR 50 cents), payout ratio 48%2 (PY: 44%) • Payout Ratio constantly within our mid-ter
Slide 29: Net Income – FY EPS at EUR 0.84, ROCE at 11.9%
3 Financial Results Q4 and FY 2022 Net Income1 – FY EPS2 at EUR 0.84, ROCE3 at 11.9% Net income1 | in EUR mn Key aspects • Q4 Net income1 at prior year’s level -5 mn 235 227 149 145 136 113 169 140 Q1 21 Q2 21 Q3 21 Q4 21 Q1 22 Q2 22 Q3 22 Q4 22 ROCE3 and Schaeffler Value Added4 | in EUR mn 16.7% 14
Slide 30: Free Cash Flow – Strongly positive in Q4
3 Financial Results Q4 and FY 2022 Free Cash Flow – Strongly positive in Q4, mainly driven by disciplined Working Capital management Free Cash Flow before M&A1 | in EUR mn Reconciliation Q4 2022 | in EUR mn +189 mn +222 -240 -48 225 55 14 240 244 -88 130 113 482 -83 244 -219 EBITDA ∆ Net Capex Net T
Slide 31: Net debt of EUR 2.2 bn – Leverage ratio at 1.1x
3 Financial Results Q4 and FY 2022 Net debt of EUR 2.2 bn – Leverage ratio1 at 1.1x, strong balance sheet and liquidity position Net financial debt and Leverage ratio1 | in EUR mn Key aspects Leverage ratio1 • Increased Revolving Credit Facility from EUR 1.8 bn to EUR 2.0 bn with maturity earliest i
Slide 32: Agenda
Agenda 1 Overview 2 Business Highlights Q4 and FY 2022 3 Financial Results Q4 and FY 2022 4 Outlook Mar 9, 2023 Deutsche Bank – Roadshow London 32 PUBLIC
Slide 33: Market assumptions – Environment assumed to remain challenging in 2023
4 Outlook Market assumptions – Environment assumed to remain challenging in 2023 Automotive Technologies – Global LVP1 2023 Automotive Aftermarket – Global LV Parc2 Industrial – Industrial Production3 ~82- 8% 4% 3.4% 82.0 85 2.6% 83.6 3% 6% 5.2% 2% World 1% 4% 0% 21.5 2.3% 19.9 19.0 21.5 World -1% 2
Slide 34: FY 2023 Guidance – Cautious Outlook for 2023
4 Outlook FY 2023 Guidance – Cautious Outlook for 2023 Group Guidance Divisional Guidance Automotive Automotive Industrial Technologies Aftermarket Actuals Guidance FY 2022 FY 20231 Actuals Guidance Actuals Guidance Actuals Guidance FY 2022 FY 2023 FY 20225 FY 2023 FY 20225 FY 2023 Sales growth2 9.4
Slide 35: Conclusion & Outlook
4 Outlook Conclusion & Outlook Solid delivery of FY 2022 – Especially on top line and cash generation, striving for further 1 improving operating efficiency going forward Compelling usage of cash – Investments in growing businesses, highly fitting acquisitions, 2 attractive dividend proposal, thanks
Slide 36: Financial calendar and selected IR events
4 Outlook Financial calendar and selected IR events Roadshows & Conferences – With Top Management participation Financial calendar 2023 Mar 8 Conference – Paris, BNP Paribas Exane Global Autos Mar 7 FY 2022 Earnings Release Mar 9 Roadshow – London, Deutsche Bank Apr 20 AGM Mar 16 Roadshow – Frankfur
Slide 37: IR Contact
IR Contact Investor Relations Phone: + 49 9132 82-4440 Email: ir@schaeffler.com Web: www.schaeffler.com/ir PUBLIC
Slide 38: Equity Story – Positioning Schaeffler for long-term value creation
Backup Equity Story – Positioning Schaeffler for long-term value creation 1 Roadmap 2025 in execution – Focus on capital allocation, portfolio management and FCF generation Automotive Technologies – Conquer leadership positions in New Business for electrified 2 Powertrains and Chassis applications 3
Slide 39: Ancillary comments to support the Equity Story
Backup Ancillary comments to support the Equity Story Additional KPIs FY 2023 Comments Order Intake E-Mobility EUR 2 - 3 bn Starting from 2022 onwards the new target of EUR 2 - 3 bn applied Focus areas include Digitalization, Sustainability, Innovation & Technology and investments in New Capex Aroun
Slide 40: Key figures Q4 and FY 2022
Backup Key figures Q4 and FY 2022 Q4 2022 FY 2022 in EUR mn Q4 2021 Q4 2022 vs. Q4 2021 FY 2021 FY 2022 vs. FY 2021 +14.6% +14.1% Sales 3,506 4,019 13,852 15,809 +11.8%1 +9.4%1 Gross Profit 846 893 +47 mn 3,440 3,579 +139 mn Gross margin 24.1% 22.2% -1.9pp 24.8% 22.6% -2.2pp EBIT2 260 233 -27 mn 1,2
Slide 41: Q4 2022 Sales development – Strong polarization across Regions and Divisions
Backup Q4 2022 Sales1 development – Strong polarization across Regions and Divisions in the last quarter of the year Automotive Automotive Schaeffler Group Industrial Technologies Aftermarket % of Group 27% 60% 13% sales Q4 2022 Europe 42% +18% +18% +23% +12% Americas 22% +15% +18% +3% +15% Greater
Slide 42: FY 2022 Sales development – All regions and divisions contributed to growth
Backup FY 2022 Sales1 development – All regions and divisions contributed to growth despite high volatility of end markets Automotive Automotive Schaeffler Group Industrial Technologies Aftermarket % of Group 27% 60% 13% sales FY 2022 Europe 42% +13% +12% +6% +20% Americas 22% +13% +14% +7% +12% Gre
Slide 43: Gross Profit – Positive pricing and increased volumes
Backup Gross Profit – Positive pricing and increased volumes partially compensating higher production costs Gross Profit FY 2021 vs. FY 2022 | in EUR mn Key aspects • Pricing: Clearly positive for all three divisions in 2022 • Volumes: All divisions reporting volume increases with Industrial showing
Slide 44: Automotive Technologies – Strong Outperformance in Q4 achieved
Backup Automotive Technologies – Strong Outperformance in Q4 achieved, EBIT margin2 down yoy due to higher input cost Sales by business division | yoy growth EBIT2 FY 2021 vs. FY 2022 | in EUR mn FY 2021 FY 2022 ∆1 E-Mobility 1,038 1,349 +24.2% Engine & Transmission 4,688 5,152 +4.5% Bearings 2,422
Slide 45: Automotive Aftermarket – Good growth in all regions
Backup Automotive Aftermarket – Good growth1 in all regions, EBIT margin5 down yoy due to higher selling costs Sales by region | yoy growth EBIT5 FY 2021 vs. FY 2022 | in EUR mn FY 2021 FY 2022 ∆1 Europe 1,276 1,355 +6.4% -2 Americas 363 434 +6.5% Greater China 101 117 +6.7% +38 -46 -1 +10 Asia/Paci
Slide 46: Industrial – Double-digit top line growth, EBIT margin flat
Backup Industrial – Double-digit top line growth1, EBIT margin2 flat yoy due to higher input costs Sales by region | yoy growth EBIT2 FY 2021 vs. FY 2022 | in EUR mn FY 2021 FY 2022 ∆1 Europe 1,472 1,764 +20.4% Americas 588 734 +11.6% -13 -69 +18 +4 Greater China 983 1,156 +8.8% +138 Asia/Pacific 52
Slide 47: Net Income – EBIT reconciliation and special items
Backup Net Income1 – EBIT reconciliation and special items Reconciliation FY 2022 | in EUR mn Key aspects • Special items amounted to EUR 72 mn in FY 2022, mainly related to the provision of EUR 130 mn for our structural measures announced in November as well as the consolidation of the Footprint in
Slide 48: Working Capital ratio 18.8% – Capex ratio 6.0% in Q4
Backup Working Capital1 ratio 18.8% – Capex ratio2 6.0% in Q4 Working capital1 | in EUR mn Capex2 | in EUR mn +276 mn +52 mn 2,543 2,726 2,752 2,700 2,803 3,184 3,368 2,976 132 136 215 188 156 175 219 240 Q1 21 Q2 21 Q3 21 Q4 21 Q1 22 Q2 22 Q3 22 Q4 22 Q1 21 Q2 21 Q3 21 Q4 21 Q1 22 Q2 22 Q3 22 Q4 22
Slide 49: Automotive Technologies (AT) outperformance by quarters
Backup Automotive Technologies (AT) outperformance by quarters FY 22 Q1 22 Q2 22 Q3 22 Q4 22 Outperformance: +1.5pp Outper- Outper- Outper- Outper- S&P1 AT2 formance S&P1 AT2 formance S&P1 AT2 formance S&P1 AT2 formance World -3.5% -3.2% +0.3pp +1.5% +1.3% -0.2pp +29.5% +25.2% -4.3pp +1.7% +10.0% +8
Slide 50: Key figures by Group and division
Backup Key figures by Group and division Group | in EUR mn Automotive Aftermarket | in EUR mn Q1 21 Q2 21 Q3 21 Q4 21 Q1 22 Q2 22 Q3 22 Q4 22 Q1 21 Q2 21 Q3 21 Q4 21 Q1 22 Q2 22 Q3 22 Q4 22 Sales 3,560 3,454 3,332 3,506 3,758 3,790 4,242 4,019 Sales 444 467 500 437 463 506 547 522 Sales Growth1 +12.
Slide 51: Overview Corporate and Financing Structure
Backup Overview Corporate and Financing Structure Corporate structure (simplified) | as of December 31, 2022 Financing structure | as of December 31, 2022 A IHO Verwaltungs GmbH INA-Holding Schaeffler Debt instrument Nominal Nominal Interest Maturity Rating GmbH & Co. KG (USD m) (EUR1 m) (Fitch/Mood