Telefonaktiebolaget LM Ericsson Class A · OMXSTO:ERIC_A
Telefonaktiebolaget LM Ericsson Class A — Ericsson — Investor Day (2014)
18 slides from Telefonaktiebolaget LM Ericsson Class A's investor day presentation, 2014
Slide 1: Summary
SUMMARY CEO, Hans Vestberg © Telefonaktiebolaget LM Ericsson | Capital Markets Day 2014 | Page 1 W
Slide 2: A Journey That Continues
A JOURNEY THAT CONTINUES 2008 2013 Net Sales . SEK 227 b. People Sales nd operators ices & SW 66% on Several Few Telco / Competition Telco & ICT Many ICT W 2020 Growth faster the market, >3-: 5% >1 25% >75% Broad ICT landscape Sales beyond operators for the year 2008 considers Ericsson's business of
Slide 3: Growth Driven by Targeted Areas
GROWTH DRIVEN BY TARGETED AREAS ESTIMATED BASED ON MARKET ASSUMPTIONS W SIE, Net Sales — Targeted areas Net sales — Ericsson Group Market growth ~10% cf ~50% of sales increase from ~30 targeted areas 2013 2020 2013 Core Targeted 2020 areas. areas. Outperform market growth in targeted areas Grow fast
Slide 4: Creating Shareholder Value
CF CATING SHAREHOLDER VALUE CUTIVE PERFORMANCE STOCK PLAN (LTV) Best in class margins 2020 SaaS SoS essoscossessccosse @ | i} i} ' Grow faster than the market Strong operating cash flow development > £ re} Ist x = ie) = oO This slide contains forward-looking statements. Actual result may be material
Slide 5: Ericsson
ERICSSON
Slide 6: Capital Structure
CAPITAL STRUCTURE CFO, Jan Frykhammar W
Slide 7: Capital Targets Overview
Ss CAPITAL TARGETS OVERVIEW sf Sep 30 2014 Target Actual Equity ratio 50% 53% 52% > 40% Net Cash SEK 39 b. SEK 38 b. SEK 29 b. Positive Investment grade rating S&P: BBB+ S&P: BBB+ S&P: BBB+ Solid IG Moody’s: A3 Moody’s: A3 Moody’s: Baa‘ Cash Conversion LTM* 116% 79% 93% > 70% Free cash flow before M
Slide 8: Financial Position: Gross and Net Cash
FI POSITION GROSS AND NeT CASH W "Gross Cash (SEK b.) “Net Cash (SEK b.) Net Cash: Cash and cash equivalents plus short-term investments less interest-bearing liabilities and post-employment benefits 2009 2010 2011 2012 2013 Our strong financial position has served us well © Telefonaktiebolaget LM E
Slide 9: Dividend Development
W DEVELOPMENT Dividend (SEK/share) 2.50 2.25 - 2009 2010 2011 2012 2013 change to the policy — we continue to strive for yearly dividend growth e Day 2014| Page 4 This slide contains forward-looking statements. Actual result may be materially different. ktiebolaget LM
Slide 10: Cash Flow 2009-2013
2009-2013 SEK b. 28 38 Cash flow ‘CAPEX Dividends Free Cash Acquisitions Free Cash from paid Flow & Flow after Operations divestments M&A 1) PP&E and Product development 2)incl.other investing activities Pos © Telefonaktiebolaget LM Ericsson | Capital Markets Day 2014 | Page 5 W e free cash flow aft
Slide 11: Debt Maturity Profile
W DEBT MATURITY PROFILE (million SEK) 7000 + 000 SEK 8 b. in debt repaid during 2014 en | Average maturity 6.0 years (4.9 years 12 months ago) aon 4 No maturities until 2017 3000 S&P rate Ericsson liquidity as zm exceptional 1000 5 oO 2014 «#2015 2016 2017 2018 2019 2020 2021 2022 EUR Fixed BOND 201
Slide 12: Key Takeaways
KEY TAKEAWAYS © Telet Targets and financial position Dividend and cash jaktiebolaget LM usage | Capital Markets Day 2014 | Page 7 v v - - - W Maintain strong financial position to support growth in Targeted areas and the execution of our Networked Society Strategy Headroom to increase leverage and s
Slide 13: Ericsson
ERICSSON
Slide 14: Closing
CLOSING CEO, Hans Vestberg © Telefonaktiebolaget LM Ericsson | Capital Markets Day 2014 | Page 1 W
Slide 15: Summary
SUMMARY Grow faster than the market Best-in-class margins Operating cash flow growth A\\ » Strong execution in core business areas » Establish leadership in targeted areas » Increase recurring revenues (software/services) and IPR sales » Monetize the footprint and improve company operating leverage
Slide 16: Growth
W GROWTH >3-5% >10% Grow faster than the market Outperform market growth in targeted areas This slide contains forward-looking statements. Actual result may be materially different.
Slide 17: Profitability
W PROFITABILITY 9b 4.5b SEK in total annual savings SEK in Opex savings from efficiency measures from efficiency measures This slide contains forward-looking statements. Actual result may be materially different.
Slide 18: Ericsson
ERICSSON