SAF-Holland SE · XETR:SFQ
SAF-Holland — FY2020 Earnings Presentation
30 slides from SAF-Holland's earnings presentation, Mar 25, 2021
Slide 1: Financial Results FY 2020
FINANCIAL RESULTS FY 2020 ALEXANDER GEIS, CEO INKA KOLJONEN, CFO MARCH 25, 2021 Financial Results FY 2020 < 1 >
Slide 2: Agenda
AGENDA 1 HIGHLIGHTS 2020 Alexander Geis 2 STRONG FINANCIAL PERFORMANCE Inka Koljonen 3 OUTLOOK Alexander Geis 4 APPENDIX Financial Results FY 2020 < 2 >
Slide 3: Review 2020: Revised guidance achieved or even exceeded
REVIEW 2020: REVISED GUIDANCE ACHIEVED OR EVEN EXCEEDED • Sales in line with guidance influenced by unfavourable Sales Capex ratio market conditions and COVID-19 • Adj. EBIT margin on par with previous year and above € 960 MN 2.5% revised guidance of 5 to 6 per cent • Capex ratio more efficient than
Slide 4: Review 2020: Robust performance in a challenging environment
REVIEW 2020: ROBUST PERFORMANCE IN A CHALLENGING ENVIRONMENT Resilience of business Preserved Financial discipline Continued strategy model profitability execution • Strong market position • FORWARD 2.0 • Effective working • Roll-out of SAF- in main regions restructuring program capital management H
Slide 5: Group: Structural margin improvements achieved across all regions
GROUP: STRUCTURAL MARGIN IMPROVEMENTS ACHIEVED ACROSS ALL REGIONS MAIN DRIVERS SALES (€ MN) SALES BY QUARTER (€ MN) - 25.3 % • Sales decrease by 25 per cent mainly driven by the Americas region (-38 per cent), while the EMEA 1,284 region was the most resilient (-12 per cent) 2019 960 2020 • After bo
Slide 6: EMEA: FY 2020 adj. EBIT margin on par with previous year despite COVID-19
EMEA: FY 2020 ADJ. EBIT MARGIN ON PAR WITH PREVIOUS YEAR DESPITE COVID-19 MAIN DRIVERS SALES (€ MN) SALES BY QUARTER (€ MN) - 11.7 % • Due to excellent market position and high share of 2019 aftermarket business, EMEA most resilient with only 626 12 per cent sales decrease and still 6 per cent adj.
Slide 7: Americas: Restructuring investment is paying off
AMERICAS: RESTRUCTURING INVESTMENT IS PAYING OFF MAIN DRIVERS SALES (€ MN) SALES BY QUARTER (€ MN) - 37.8 % • With 38 per cent sales decline and adj. EBIT margin 534 2019 down to 0.6 per cent in Q2, the Americas region was 2020 strongly hit by the pandemic 332 • FX effects (-2.1 per cent respectivel
Slide 8: APAC: Lockdown and delayed ramp-up weigh on sales and profitability
APAC: LOCKDOWN AND DELAYED RAMP-UP WEIGH ON SALES AND PROFITABILITY MAIN DRIVERS SALES (€ MN) SALES BY QUARTER (€ MN) - 39.8 % • China: Consolidation of production network and cleaning up of the balance sheet completed 123 2019 2020 • APAC (excl. China): Positive adj. EBIT margin despite 74 sales dr
Slide 9: Investments: Disciplined investment policy
INVESTMENTS: DISCIPLINED INVESTMENT POLICY • Investment approval process and capital allocation INVESTMENTS (€ MN) INVESTMENTS (AS % OF SALES)* worked very well in 2020 • Focus of investing activities: further automation of 60 5.0% production processes at various locations in the Americas region and
Slide 10: Net working capital: Substantial improvements achieved
NET WORKING CAPITAL: SUBSTANTIAL IMPROVEMENTS ACHIEVED • Net working capital significantly down both in absolute NET WORKING CAPITAL (€ MN) NET WORKING CAPITAL (IN % OF SALES)* and relative terms 14.5% 14.3% • Inventories down by 24.8 per cent to € 126 mn 200 13.6% 15% 13.5% 14% • Trade receivables
Slide 11: Cash conversion: Record level operating cash flow
CASH CONVERSION: RECORD LEVEL OPERATING CASH FLOW * • Working Capital Management key factor in improving CASH FLOW (€ MN) the operating free cash flow before taxes Operating • One-time fly-off cash conversion rate of 177 per cent Other cash flow* driven by cyclical effects, mitigation measures and C
Slide 12: Cash conversion rate: Exceptional result
CASH CONVERSION RATE: EXCEPTIONAL RESULT in EUR thousands 2016 2017 2018 2019 2020 EBITDA 101,058 97,355 107,491 88,213 82,092 Change in NWC 1,949 -25,412 -38,395 9,669 48,481 Other Cash and Non-Cash Items 3,390 2,132 -2,577 11,226 14,534 Operating cash flow * 106,397 74,075 66,519 109,108 145,107 C
Slide 13: Net debt/EBITDA: Significant deleveraging in challenging environment
NET DEBT/EBITDA*: SIGNIFICANT DELEVERAGING IN CHALLENGING ENVIRONMENT • Q2 2020 strongly hit by COVID-19 with substantially 5.00 lower EBITDA and higher Net Debt Net Debt/EBITDA* target range 2-3x 4.42 4.50 • Q4 2020 shows strong improvement driven by 4.00 significantly lower Net Debt and substantia
Slide 14: Strategic focus 2021: High quality growth in global recovery
STRATEGIC FOCUS 2021: HIGH QUALITY GROWTH IN GLOBAL RECOVERY Managing profitable growth Strengthening individual Expanding technological Driving ESG in uncertain environment market positions advantages excellence • EMEA: building on excellent • Product improvements for • Further improving • Securing
Slide 15: Truck and trailer production 2021: Strong upswing
TRUCK AND TRAILER PRODUCTION 2021: STRONG UPSWING NORTH SOUTH EUROPE CHINA INDIA AMERICA AMERICA* Truck Trailer Truck Trailer Truck Trailer Truck Trailer Truck Trailer +15% +16% +41% +32% +30% +6% -15% to -20% -5% to -10% +30% +40% • SIGNIFICANT REBOUND IN • HIGHER VOLUMES IN EUROPE • CHINA WITH DEC
Slide 16: Guidance 2021
GUIDANCE 2021* FY 2020 FY 2021 € 1,050 mn to Sales € 959.5 mn € 1,150 mn Adj. EBIT margin 6.1 per cent Around 7 per cent Around 2.5 per cent CAPEX 2.5 per cent of sales of sales • The EBIT guidance for FY 2021 is based on the assumption that in the remainder of the year there will be no unexpected i
Slide 17: Key takeaways
KEY TAKEAWAYS 1. Proven margin and cash flow performance during pandemic environment 2. Resilient and high aftermarket share 3. Best positioned for recovery with leaner structures and improved product portfolio 4. Benefiting from an upswing in Europe, North America, Brazil and India based on leading
Slide 18: Financial calendar & IR contact
FINANCIAL CALENDAR & IR CONTACT DATE EVENT INVESTOR RELATIONS CONTACT 25.03.2021 Publication of the Annual Report 2020 Michael Schickling 31.03.2021 Jefferies Pan-European Mid-Cap Virtual Conference T: +49 (0) 6095 301 617 E: ir@safholland.de 14.04.2021 Virtual Management Roadshow Alexander Pöschl 1
Slide 19: Appendix
APPENDIX Financial Results FY 2020 < 19 >
Slide 20: Truck and trailer production 2020: Strongly influenced by COVID-19
TRUCK AND TRAILER PRODUCTION 2020: STRONGLY INFLUENCED BY COVID-19 NORTH SOUTH EUROPE CHINA INDIA AMERICA AMERICA** Truck* Trailer Truck Trailer Truck Trailer Truck Trailer Truck Trailer -27% -23% -38% -39% -20% +6% +50% -5% -60% -60% • SIGNIFICANT DECLINES IN EUROPE, • MIXED RESULTS IN SOUTH NORTH
Slide 21: P&L FY 2020: Extraordinary items
P&L FY 2020: EXTRAORDINARY ITEMS Total FY 2020 in % Total FY 2019 in % in EUR thousands FY 2020 Adjustments adjusted* of sales FY 2019 Adjustments adjusted* of sales Sales 959,519 – 959,519 100.0% 1,284,155 – 1,284,155 100.0% Cost of sales -790,673 9,985 -780,688 -81.4% -1,082,414 15,857 -1,066,557
Slide 22: Group: Reconciliation EBIT to adjusted EBIT
GROUP: RECONCILIATION EBIT TO ADJUSTED EBIT in EUR thousands FY 2020 FY 2019 Change absolute Change in % EBIT 31,102 35,199 -4,097 -11.6% EBIT margin in % 3.2% 2.7% – – Additional depreciation and amortization of property, plant 10,184 9,673 511 5.3% and equipment and intangible assets from PPA Good
Slide 23: EMEA: Reconciliation EBIT to adjusted EBIT
EMEA: RECONCILIATION EBIT TO ADJUSTED EBIT in EUR thousands FY 2020 FY 2019 Change absolute Change in % EBIT 45,721 50,486 -4,765 -9.4% EBIT margin in % 8.3% 8.1% – – Additional depreciation and amortization of property, plant 4,637 4,611 26 0.6% and equipment and intangible assets from PPA Goodwill
Slide 24: Americas: Reconciliation EBIT to adjusted EBIT
AMERICAS: RECONCILIATION EBIT TO ADJUSTED EBIT in EUR thousands FY 2020 FY 2019 Change absolute Change in % EBIT 2,470 15,714 -13,244 -84.3% EBIT margin in % 0.7% 2.9% – – Additional depreciation and amortization of property, plant 2,352 2,484 -132 -5.3% and equipment and intangible assets from PPA
Slide 25: APAC: Reconciliation EBIT to adjusted EBIT
APAC: RECONCILIATION EBIT TO ADJUSTED EBIT in EUR thousands FY 2020 FY 2019 Change absolute Change in % EBIT -17,089 -31,001 13,912 -44.9% EBIT margin in % -23.0% -25.1% – – Additional depreciation and amortization of property, plant 3,195 2,578 617 23.9% and equipment and intangible assets from PPA
Slide 26: D&A ratio: At peak level
D&A RATIO: AT PEAK LEVEL 2019 • Investments in plant, property, INVESTMENTS (IN % OF SALES) INVESTMENTS BY QUARTER (IN % OF SALES) equipment and intangible assets 2020 reached 2.5 per cent of Group sales 5.9% (FY 2020 guidance: around 2.5 per cent of Group sales) 4.1% 4.2% 4.0% 3.3% • Operating cash
Slide 27: Adj. EBITDA margin
ADJ. EBITDA MARGIN GROUP ADJ. EBITDA MARGIN ADJ. EBITDA MARGIN BY QUARTER 2019 13.1% 10.2% 2020 9.7% 9.8% 10.1% 8.9% 9.2% 8.6% 7.4% 7.8% FY Q1 Q2 Q3 Q4 EMEA ADJ. EBITDA MARGIN ADJ. EBITDA MARGIN BY QUARTER 12.3% 13.1% 16.1% 14.3% 11.5% 12.3% 11.9% 12.0% 13.1% 10.0% FY Q1 Q2 Q3 Q4 NOTE: All figures s
Slide 28: Adj. EBITDA margin
ADJ. EBITDA MARGIN AMERICAS ADJ. EBITDA MARGIN ADJ. EBITDA MARGIN BY QUARTER 2019 13.0% 2020 9.2% 10.2% 10.3% 8.0% 8.0% 7.3% 7.6% 6.1% 5.8% FY Q1 Q2 Q3 Q4 APAC ADJ. EBITDA MARGIN ADJ. EBITDA MARGIN BY QUARTER 5.1% 0.9% -1.8% -4.6% -6.5% -7.5% -7.4% -10.5% -12.0% -18.0% FY Q1 Q2 Q3 Q4 NOTE: All figur
Slide 29: Current financing structure
CURRENT FINANCING STRUCTURE MATURITY PROFILE (€ MN) 100** 20 200* Amount Maturity 9 Product € mn date 5 Loan RMB 9.0 06/2022 141 Promissory note loan old (7 years) 5.0 11/2022 Promissory note loan new (3 years) 141.0 03/2023 Promissory note loan new (3.5 years) 20.0 09/2023 69 Revolving credit facil
Slide 30: Disclaimer
Disclaimer Not for general release, publication or distribution in the United States, Australia, Canada or Japan. By attending this presentation you agree to be bound by the following limitations: This presentation has been prepared by SAF-HOLLAND SE (“SAF-HOLLAND”) and comprises written materials c