Ferronordic Ab · OMXSTO:FNM
Ferronordic Ab — Q3 2023 Earnings Presentation
19 slides from Ferronordic Ab's earnings presentation, November 2023
Slide 1: Ferronordic Third quarter 2023
Ferronordic Third quarter 2023
Slide 2: Q3 2023: Weak operationally. Key strategically.
Q3 2023: Weak operationally. Key strategically. • Subsequent event: Ferronordic acquires major Volvo CE dealer in the US Group • 56% increase in revenue with growth in both operating segments • Lower margins, higher costs, higher working capital • Operating result decreased to SEK -28m and operating
Slide 3: Q3 2023 Tough but transformational
Q3 2023 Ferronordic agreed to Tough but transformational acquire the Rudd • On 13 November, Ferronordic agreed to acquire the Rudd Equipment Equipment Company Company, a major dealer of Volvo CE and certain other brands in the US • In 2022, Rudd had revenue of USD 308m and operating result of USD 16
Slide 4: Q3 2023 Group summary financials
Q3 2023 Group summary financials SEK 643m Group revenue +56% to SEK 643m (+56%) revenue • German revenue +60% to SEK 574m (+44% in EUR) • Truck sales +88% (+69% in EUR), aftermarket sales +27% (+14%) and other sales -14% (-22%) • CA revenue +30% (+23% in local currency) to SEK 69m SEK -28m • Equipme
Slide 5: Q3 2023 Germany operational highlights
Q3 2023 Our new truck sales in Germany operational highlights units increased by 45% • Based on registrations of new trucks, the total German market for to 241 units in Q3 2023 heavy trucks increased by 45% in Q3 20231 • Tractors grew by 50% and rigids by 40% • The market grew mainly as supply impro
Slide 6: Q3 2023 CA operational highlights
Q3 2023 Sales of new machines CA operational highlights in units increased by 6% to 17 • The Kazakh market for construction equipment is supported by Kazakhstan’s growing role as a regional hub, strong commodity prices and big infrastructure projects • Excluding Chinese wheel loaders, the Kazakh mar
Slide 7: Business development
Business development Germany We acquired the Rudd Equipment Company • Ferronordic started operations in Northeim in October 2023 • In e-trucks, we rented out our two first heavy-duty tractors • Our e-trucks became eligible for the “THG Quote” (greenhouse gas quota) • We launched a cost optimisation
Slide 8: German network expansion
German network expansion • Fulda - Transaction closed in January 2021 • Limburg - Transaction closed in April 2021 • Nordhausen - Transaction closed in June 2021 Hanover • Bergstrasse - Transaction closed in October 2021 Peine Barleben Coswig • Bingen, Kirn and Simmern -Transaction closed in Northei
Slide 9: Kazakhstan network
Kazakhstan network Astana Ust-Kamenogorsk Aktobe Karaganda Atyrau Aschaffenburg Almaty Shymkent 9 (7) Ferronordic outlets in Kazakhstan as of October 2023
Slide 10: Economic development
Economic development Germany’s economy • Germany -0.8% in Q3 2023 • +0.2% GDP in Q1, -0.4% GDP in Q2 and -0.8% GDP in Q3 20231 • -0.1% GDP expected in 20232 • +0.9% GDP expected in 20242 Inflation reached 3.8% Y-o-Y in • Inflation rate at +7.9% in 2022 and +3.8% in October 20233 • Manufacturing PMI
Slide 11: Q3 2023 Income statement
Q3 2023 Income statement Q3 2022 Q3 2022 Q3 2022 Q3 2023 Q3 2023 Q3 2023 % change • Total revenue up by +56% to SEK 643m SEK MM CA Germany Group CA Germany Group Group o 89% Germany and 11% CA o 70% equipment and trucks, 27% FX (SEK/KZT, EUR/SEK) 45.15 10.62 42.10 11.76 aftermarket and 3% other New
Slide 12: Segment reporting
Q3 2023 Segment reporting Unallocated Germany CA Group costs1 Total Q3 Q3 Q3 Q3 Q3 Q3 Q3 Q3 SEK m (or as stated) 2023 2022 2023 2022 2023 2022 2023 2022 External revenue 574 359 69 53 643 412 Equipment and truck sales 396 211 54 38 449 249 Aftermarket sales 158 125 15 15 173 140 Other revenue 20 23
Slide 13: Germany: Trend in operating result and margin
Germany: Trend in operating result and margin 10 2% 5 5 0.8% 2 0.3% 0 0% -0.4% -2 -5 -5 -1.4% -10 -2% -2.8% -15 -16 -20 -4% Q3 2022 Q4 2022 Q1 2023 Q2 2023 Q3 2023 Operating profit (SEK m) Operating margin (%) 13
Slide 14: Kazakhstan: Trend in operating result and margin
Kazakhstan: Trend in operating result and margin 10 10% 9% 9% 8 8% 8% 7 7 6 5 6% 6% 4 4 4% 2 2% 0 0% 0 0% Q3 2022 Q4 2022 Q1 2023 Q2 2023 Q3 2023 Operating profit (SEK m) Operating margin (%) 14
Slide 15: Q3 2023 Balance sheet
Q3 2023 Balance sheet SEK MM Q3 2022 Q2 2023 Q3 2023 • PP&E decreased Y-o-Y mainly due to the disposal of Russian subsidiaries FX (SEK/KZT, EUR/SEK) 42.17, 10.92 42.05, 11.79 43.84, 11.49 • In CA, net working capital decreased Q-o-Q from 32% to 23% of LTM revenue Property, plant and equipment 1,263
Slide 16: Group NAV Q3 2023
SEKm 0 1,000 2,000 3,000 4,000 Cash and equivalents 950 Trade and other EBIT Q4 19 318 receivables Inventory 699 Group NAV Q3 2023 Property, plant and 655 equipment Other assets 197 Trade and other 470 payables Borrowings 497 Lease and other liabilities 101 65 EBIT Q4 20 NAV 1,750 16
Slide 17: Group net cash development Q3 2023
Group net cash development Q3 2023 600 -66 -38 400 -44 -13 539 SEKm 200 378 65 0 Net cash EoP CAPEX FX (cash) Other Net cash BoP Working capital increase EBIT Q4 19 EBIT Q4 20 17
Slide 18: Outlook
Outlook Uncertainty about the German economy increased during the third quarter. Although there were some signs of improvement in recent weeks, higher interest rates and inflation make customers more cautious. The market recovery seen in 2023 will likely slow down. However, we expect stronger demand
Slide 19: In Ferronordic
IN FERRONORDIC