Rheinmetall Ag · XETR:RHM

Rheinmetall — Investor Day (December 2016)

32 slides from Rheinmetall's investor day presentation, Dec 9, 2016

Slide 1: Capital Market Day 2016 – Rheinmetall Defence – Markets and Strategic Development
Capital Market Day 2016 Rheinmetall Defence – Markets and Strategic Development Armin Papperger, CEO Düsseldorf | 9 December 2016
Slide 2: Development of markets and internationalization strategy; Strategic targets of our divisions
1 Development of markets and internationalization strategy 2 Strategic targets of our divisions © Rheinmetall AG I 9 December 2016 2
Slide 3: Global defence budgets growth
Global defence budgets growth Defence is at the beginning of long lasting market growth North America Europe 2017-2020 +0.9% World 2016 - 2020 Expected average annual growth ~1.5% NATO-Target MENA Moving defence budgets +3.0% to 2% of GDP in all Latin America member states until 2025 Asia/Pacific +2
Slide 4: NATO Defence budgets
NATO Defence budgets Efforts to reach the 2%-target Selected NATO countries – Defence expenditures in % of GDP 2015 Latvia 1,0% Italy 1,0% 2015: Five countries exceed the Czech Republic 1,1% Lithuania 1,1% NATO-standard of 2% Netherlands 1,2% Germany 1,2% 2016: Increasing budgets in 22 of 28 NATO No
Slide 5: US defence policy
US defence policy New approach by the new administration? Speech on national security, September 07, 2016 “We currently have the smallest Army since 1940 …” “As soon as I take office, I will ask Congress to fully eliminate the defense sequester and will submit a new budget to rebuild our military.”
Slide 6: The German role in global defence
The German role in global defence A new political mindset becomes evident Ursula von der Leyen, Minister of Defence Joachim Gauck, Federal President Angela Merkel, Federal Chancellor “Germany has to carry over more “The Federal Republic must also be ready “Certainly, this means, that a country respo
Slide 7: The German defence budget
The German defence budget Government determined to raise expenditures German Defence budget 2014-2020 in EUR bn 60,1** 2%-GDP +6% +14% 37,9 39,2 36,6 36,9 32,4 33,0 34,3 1,2% GDP 6.7* 2014 2015 2016 2017 2018 2019 2020 ** Reference GDP 2015 *Procurement/R&D Source: Federal Ministry of Finance, Feder
Slide 8: Order potential from Germany
Order potential from Germany A number of projects targeted by Rheinmetall 2016 Gladius soldier system Combat training center Potential: ~ EUR 250 m Additional equipment Potential: EUR >50 m Long-term potential: EUR ~300 m Service contract Potential: EUR 50-100 m Leopard 2 Upgrade order for 104 tanks
Slide 9: Order potential from Germany
Order potential from Germany A number of projects targeted by Rheinmetall 2016 Puma Additional equipment Potential: EUR 600 m Demand for additional IFVs Long term potential: EUR 900 m Ammunition partnering agreement Potential: EUR ~300 m p.a. Net centric digital battlefield Key project of German arm
Slide 10: Progress in the internationalization strategy
Progress in the internationalization strategy © Rheinmetall AG I 9 December 2016 10
Slide 11: Internationalization strategy
Internationalization strategy Recent developments in establishing hubs and JVs Russia / Scandinavia Kazakhstan Canada United Kingdom Poland: New company Romania: New JV USA Netherlands Turkey: New JV North Africa Israel Mexico: New company India GCC Saudi Arabia Indonesia: New JV planned Brazil Sout
Slide 12: International order potential
International order potential Focus on new huge projects BEYOND Australia Australia Land 400 program Logistic Vehicles Boxer with Lance turret Demand for further orders Potential: EUR ~2.5 bn Potential: EUR >300 m United Kingdom United Kingdom Challenger 2 Mechanized Infantry Vehicle- Life extension
Slide 13: International order potential
International order potential Focus on new huge projects 2016 Middle East customer Asian customer Logistic Vehicles Air Defence Demand for further orders Potential: EUR >200 m Potential: EUR ~600 m Asia/Pacific region Algeria Munition Fox kits Potential: EUR 300-400 m Potential: EUR >200 m © Rheinme
Slide 14: Markets and Competition
Markets and Competition News about consolidation in Europe Governmental shareholding restricts room for cross-border consolidation Big common armament programs as Nammo Patria catalyst for further consolidation are not Saab at European mid-term horizon Cobham BAE Systems Chemring Rheinmetall CH PL T
Slide 15: Public Security Market
Public Security Market Police forces and budgets Germany 290.000 HC EUR 20 bn thereof equipment Europe EUR 1.8 bn North America 2.305.000 HC 876.000 HC USD 150 bn USD 128 bn China 5.000.000 HC India USD 80 bn Africa 1.580.000 HC 908.500 HC USD 92 bn USD 12 bn South America 1.260.000 HC USD 40 bn Aus
Slide 16: Public security gains importance
Public security gains importance … with chances for our technical capabilities Law Enforcement Airport Security Special Purpose Vehicles Equipment for Police Forces Protection of Critical Infrastructure and Events © Rheinmetall AG I 9 December 2016 16
Slide 18: Division Weapon and Ammunition – Strategic Targets
Division Weapon and Ammunition – Strategic Targets Sustaining and extending the business Maintaining the globally leading market position by organic growth and new strategic partnerships Expanding leadership in technology by shifting innovations to serial production Securing independence of exports
Slide 19: Achieving organic growth based on recently received orders
Strategic targets Achieving organic growth based on recently received orders Sales weapon and ammunition business in EUR m 700 In 2016, sales of weapon and ammunition will exceed the level of EUR 700 m and rise to a new 500 peak In 2016, large orders with a value of up to EUR 770 m acquired from int
Slide 20: Growing by various strategic partnerships
Strategic targets Growing by various strategic partnerships United Kingdom United States, Defense Munitions International (DMI) Partnering agreements with Defence Equipment and 50:50-JV with General Dynamics Ordnance and Support (DE&S) and with BAE Systems Tactical Systems Netherlands New: United St
Slide 21: Shifting innovations to serial orders
Strategic targets Shifting innovations to serial orders Large Caliber Munition DM 11 High Energy Laser Technology Advanced multipurpose Successfully tested by German ammunition with Navy, ready for operations in programmable fuses 2-4 years Market potential for 20 Domestic R&D orders of internationa
Slide 22: Secure independency of German export regulations and profitability
Strategic targets Secure independency of German export regulations and profitability RWM Italia Switzerland Austria Sales in EUR m 100 Italy United States 60 Rheinmetall Denel Munition 48 (South Africa) Sales 42 250 in EUR m 11 150 150 Indonesia (planned) 113 2011 2014 2015 2016e Mid- term 85 South
Slide 23: Division Electronic Solutions – Strategic targets
Division Electronic Solutions – Strategic targets Reshaping and complementing the business Widening the Air Defence product portfolio by forming an exclusive partnership with a missile house to complement the canon-based SHORAD (Short Range Air Defence) product portfolio Expanding the customer struc
Slide 24: Strategic targets – Simulation and Training
Strategic targets – Simulation and Training Expanding the customer structure by marketing of civil applications Off-shore maritime simulation for Pemex Simulation and Training for Emergency and crisis management EUR 250 million Exploration and production process Plant operation © Rheinmetall AG I 9
Slide 25: Strategic targets – Mission Equipment
Strategic targets – Mission Equipment Moving from a component manufacturer to a system provider Component supplier for (Rheinmetall) System house “Armored infantryman” Net-centric digital battlefield/ military vehicles Gladius Soldier System Mobile tactical communication Puma Position Rheinmetall as
Slide 27: Foundation of the Division Vehicle Systems in 2016
Foundation of the Division Vehicle Systems in 2016 A Competitive International Supplier Leading European supplier of military vehicle systems Sole provider of the complete product portfolio of military vehicles in the West New vehicles are ready for market launch Strong track record through successf
Slide 28: Division Vehicle Systems – Strategic targets
Division Vehicle Systems – Strategic targets Securing growth by serial and upgrade orders Benefitting from the present status as the leading European system house for tracked and wheeled military vehicles Shaping the profile of Vehicle Systems as a one-stop-shop for a wide spectrum of innovative mil
Slide 29: Shaping profile of an one-stop-shop with the most modern fleet
Strategic target Shaping profile of an one-stop-shop with the most modern fleet Tr a c k e d Ve h i c l e s W h e e l e d Ve h i c l e s L o g i s t i c Ve h i c l e s Tu r r e t Te c h n o l o g y NBC / C-IED MBT Advanced Tech BOXER Armored Multirole SX – Tactical Truck System Medium Caliber LANCE
Slide 30: Securing growth by acquisition of further large-scale orders
Strategic targets Securing growth by acquisition of further large-scale orders UK: Challenger life extension Scandinavia: Military trucks UK: MIV Boxer Lithuania: Boxer Canada: Modernization Leopard Netherlands: Boxer Poland: Modernization program Germany: Military trucks Romania: Wheeled vehicles A
Slide 31: Summary
Summary Defence in an encouraging market environment Rethinking of Western defence policy results in higher budgets and market growth The high order book and current order potentials trigger organic growth of Rheinmetall Defence New threats and higher demand in public security lead to additional cha

Rheinmetall — Investor Day (December 2016) on 6ix

Rheinmetall — Investor Day (December 2016)

Slide 1: Capital Market Day 2016 – Rheinmetall Defence – Markets and Strategic Development

Slide 2: Development of markets and internationalization strategy; Strategic targets of our divisions

Slide 3: Global defence budgets growth

Slide 4: NATO Defence budgets

Slide 5: US defence policy

Slide 6: The German role in global defence

Slide 7: The German defence budget

Slide 8: Order potential from Germany

Slide 9: Order potential from Germany

Slide 10: Progress in the internationalization strategy

Slide 11: Internationalization strategy

Slide 12: International order potential

Slide 13: International order potential

Slide 14: Markets and Competition

Slide 15: Public Security Market

Slide 16: Public security gains importance

Slide 17: Strategic targets

Slide 18: Division Weapon and Ammunition – Strategic Targets

Slide 19: Achieving organic growth based on recently received orders

Slide 20: Growing by various strategic partnerships

Slide 21: Shifting innovations to serial orders

Slide 22: Secure independency of German export regulations and profitability

Slide 23: Division Electronic Solutions – Strategic targets

Slide 24: Strategic targets – Simulation and Training

Slide 25: Strategic targets – Mission Equipment

Slide 26: Division Vehicle Systems

Slide 27: Foundation of the Division Vehicle Systems in 2016

Slide 28: Division Vehicle Systems – Strategic targets

Slide 29: Shaping profile of an one-stop-shop with the most modern fleet

Slide 30: Securing growth by acquisition of further large-scale orders

Slide 31: Summary

Slide 32: © Rheinmetall AG I 9 December 2016