Slide 1: Second Quarter 2023
SECOND QUARTER 2023 Krister Blomgren, CEO and Jens Blom, CFO 20 July 2023
Slide 2: Vision, How, What
VISION HOW WHAT Change the world of digging Superior value proposition Full-range product suite Productivity Tiltrotators 360° rotation +/- 45° tilt Efficiency Quick couplers ~98% of global Efficient tool changes digging1 without leaving the cab Flexibility Tools Advanced hydraulic and mechanic atta
Slide 3: Exceptional history of organic sales growth and margin expansion
EXCEPTIONAL HISTORY OF ORGANIC SALES GROWTH AND MARGIN EXPANSION 1 938 Net sales, SEKm EBIT margin1 (pre-IPO expenses) 1 488 1 194 1 065 1 077 951 780 589 22% 22% 441 444 496 20% 20% 18% 17% 15% 15% 16% 13% 11% 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Note: Information is derived from
Slide 4: Q2 Business Highlights
Q2 BUSINESS HIGHLIGHTS • Good profitability and strong cash flow despite lower net sales. • Lower order intake due to the macroeconomic situation and dealer stock. • Gradual improvement of order intake on parts of the European market. • Compatibility of next generation control systems (DC3) with Cat
Slide 5: Q2 Figures in Brief
Q2 FIGURES IN BRIEF Decreased organic net sales and good profitability -10% -38% 41% 20% 73% Organic net Organic order Gross Text EBIT ReturnText on capital sales intake margin margin employed Q2 2023 5
Slide 6: Business and Financial Development
BUSINESS AND FINANCIAL DEVELOPMENT Q2 2023 6
Slide 7: Lower order intake in Q2
LOWER ORDER INTAKE IN Q2 Order intake and net sales development per quarter, MSEK Key comments Order intake Net sales • Net sales decreased -5%, organic -10%, currency effect of 26 MSEK. 774 • Record net sales in the period 691 Jan – Jun. 582 • Order intake decreased -34%, 553 519 534 541 508 organi
Slide 8: Q2 – Slowdown in Nordics and Europe
Q2 – SLOWDOWN IN NORDICS AND EUROPE Organic order intake and net sales per geographic region, MSEK Nordics Europe Americas Asia-Oceania Chungcheongnam-do Mature Early Early Early market days days days Strömsund Tewkesbury Veenendaal Vasa Wertheim Oslo Paris Montréal Connecticut Odense Sydney 311 179
Slide 9: YTD - Strong net sales growth outside Nordics
YTD - STRONG NET SALES GROWTH OUTSIDE NORDICS Organic order intake and net sales per geographic region, MSEK Nordics Europe Americas Asia-Oceania Chungcheongnam-do Mature Early Early Early market days days days Strömsund Tewkesbury Veenendaal Vasa Wertheim Oslo Paris Montréal Connecticut Odense Sydn
Slide 10: Net sales split by region Jan - Jun
NET SALES SPLIT BY REGION JAN - JUN YTD 2022 YTD 2023 Asia-Oceania Asia-Oceania 6% 7% Americas 7% Americas 14% Europe Nordics Nordics 27% 60% 46% Europe 33% Q2 2023 10
Slide 11: Good EBIT and lower net sales
GOOD EBIT AND LOWER NET SALES EBIT and EBIT margin per quarter Key comments EBIT, MSEK EBIT margin, % • Good EBIT, improved by 5% to 104 (99) MSEK. +5% • EBIT margin of 20.5% (18.5%). 198 • The lower net sales gives a negative effect on gross margin. 121 • Strong EBIT level despite slight 99 104 104
Slide 12: Overview of costs and EBIT
OVERVIEW OF COSTS AND EBIT Key comments 2023 2022 2023 2022 MSEK Q2 Q2 R12 FY Net sales 508 534 2,156 1,938 COGS -302 -307 -1,210 -1,105 • EBIT Stablemargin gross pre-IPO margin 20.5% (20,8%) and 24.5% in R12. Gross margin 40.6% 42.5% 43.9% 43.0% • Price increases in January and Selling expenses -64
Slide 13: Strong cash flow
STRONG CASH FLOW Cash flow and net working capital overview, MSEK Operating cash flow per quarter, MSEK 2023 2022 2022 277 MSEK Q2 Q2 FY Cash flow before changes in working 110 132 449 capital Inventories 396 393 443 92 Accounts recievables 286 298 347 63 56 36 45 5 5 Other receivables 16 62 29 2021
Slide 14: Record high ROCE level
RECORD HIGH ROCE LEVEL Return on capital employed overview Average capital employed and ROCE 2023 MSEK 2019 2020 2021 2022 R12 Average capital employed, MSEK ROCE, % EBT 192 218 341 415 512 800 750 100,0 717 720 Interest expense 3 2 2 8 16 700 621 Capital employed, 80,0 beginning 484 543 699 735 666
Slide 15: Financial Targets YTD
FINANCIAL TARGETS YTD Growth Profitability Capital efficiency Capital structure Exceed the growth in existing Have an EBIT margin in Continue to achieve an Maintain a strong capital market through organic excess of 20 per cent, industry-leading capital structure supporting further growth. measured o
Slide 16: Summary and Outlook
SUMMARY AND OUTLOOK • Good result and a strong cash flow in the quarter. • Record high net sales and profitability in the period. Ska bytas mot Bauma-bild! • Less guidance from orderbook for coming quarters and higher dependence on order intake. • Next generation tiltrotator estimated to Q1 2024. •
Slide 17: Increased stakeholder dialogue
INCREASED STAKEHOLDER DIALOGUE Environmental and safety benefits In dialogue with ~25% efficiency gains ~2.2 number of tools or machines End Construction that can be replaced customers companies ~6,000 litres fuel saved per year Legislators / ~113,000 kg CO 2 OEM / OED* Unions saved over excavator l
Slide 18: For more information visit www.engcongroup.com
For more information visit www.engcongroup.com