Deutz AG · XETR:DEZ
Deutz — FY2008 Earnings Presentation
38 slides from Deutz's earnings presentation, Mar 19, 2009
Slide 1: Annual Results Press Conference Financial year 2008
ANNUAL RESULTS PRESS CONFERENCE Financial year 2008 Cologne, 19 March 2009
Slide 2: Agenda
Agenda Overview of FY 2008 Dr.-Ing. Helmut Leube, Chairman of the Management Board Key performance indicators for FY 2008 Helmut Meyer, CFO Outlook and "MOVE" programme Dr.-Ing. Helmut Leube, Chairman of the Management Board Appendix Annual Results Press Conference - Financial year 2008 Colo
Slide 3: Overview of financial year 2008
Overview of financial year 2008 The year 2008 ended with the greatest financial and economic crisis in decades - Good business performance in H1 2008; no drop in orders seen - Decline in demand grows in intensity after mid-year - Significant consumer industries of DEUTZ affected including the cons
Slide 4: 5-year comparison of sales trends
5-year comparison of sales trends units -12% Ø +18% p.a. 285,861 252,359 236,679 195,082* 172,684* 151,242 148,687 134,619 103,672 2004 2005 2006 2007 2008 H1 H2 H1 H2 After several years of growth in a row, the global financial and economic crisis prevents the occurrence of another record year.
Slide 5: Unit sales overview
Unit sales overview units -11.7% -43.5% 285,861 36,890 252,359 79,451 32,678 248,971 11,790 219,681 67,661 44,868 8,571 36,297 FY 2007 FY 2008 Q4 2007 Q4 2008 Reduction in unit sales impacts all regions and all application segments, especially construction equipment and material handling equipment
Slide 6: Revenue overview
Revenue overview € million -1.9% -25.7% 1,524.2 1,495.0 338.2 351.8 423.5 1,186.0 1,143.2 100.1 314.7 323.4 93.9 220.8 FY 2007 FY 2008 Q4 2007 Q4 2008 Mix effects soften the decline in revenue compared to unit sales; year on year increase in revenue for DEUTZ Customised Solutions (+4%) Group-wid
Slide 7: Revenue by region
Revenue by region FY 2008 (FY 2007/change in %) Africa/Middle East 6% €86.4 million (-2.7%) Germany 24% Asia-Pacific 8% €364.7 million (+8.7%) €118.6 million (-4.2%) €1,495.0 million (€1,524.2 million) Americas 12% €180.7 million (-12.8%) Rest of Europe 50% €744.6 million (-3.2%) Annual Results Pres
Slide 8: New orders overview
New orders overview € million -13.9% -42.4% 1,584.5 380.6 1,363.5 331,0 1,203.9 369.1 1,032.5 88.6 280.5 212.6 54.4 158.2 FY 2007 FY 2008 Q4 2007 Q4 2008 Decline in demand accelerated even further in Q4 2008; particularly in Mobile Machinery Development of new orders reflects forecasts of releva
Slide 9: Segments overview: Compact Engines
Segments overview: Compact Engines FY FY Delta Q4 Q4 Delta € million 2008 2007 in % € million 2008 2007 in % New orders 1,032.5 1,203.9 -14.2 New orders 158.2 280.5 -43.6 Unit sales (units) 219,681 248,971 -11.8 Unit sales (units) 36,297 67,661 -46.4 Revenue 1,143.2 1,186.0 -3.6 Revenue 220.8 323.4
Slide 10: Compact Engines: Revenue by application segment
Compact Engines: Revenue by application segment FY 2008 (FY 2007/change in %) Other 1% €8.1 million Mobile Machinery 40% (-52.4%) €454.8 million (-12.0%) Service 9% €100.6 million (+8.8%) €1,143.2 million Agricultural Machinery 16% (€1,186.0 million) €186.0 million (+37.0%) Stationary Equipment 15%
Slide 11: Segments overview: DEUTZ Customised Solutions
Segments overview: DEUTZ Customised Solutions FY FY Delta Q4 Q4 Delta € million 2008 2007 in % € million 2008 2007 in % New orders 331.0 380.6 -13.0 New orders 54.4 88.6 -38.6 Unit sales (units) 32,678 36,890 -11.4 Unit sales (units) 8,571 11,790 -27.3 Revenue 351.8 338.2 4.0 Revenue 93.9 100.1 -6.2
Slide 12: DEUTZ Customised Solutions: Revenue by application segment
DEUTZ Customised Solutions: Revenue by application segment FY 2008 (FY 2007/change in %) Agricultural Machinery 3% Service 32% €9.8 million (-64.9%) €111.4 million (+0.4%) Other 7% €23.8 million (+18.4%) €351.8 million Automotive 12% (€338.2 million) €43,1 million (+2.1%) Stationary Equipment 25% Mo
Slide 13: Agenda
Agenda Overview of FY 2008 Dr.-Ing. Helmut Leube, Chairman of the Management Board Key performance indicators for FY 2008 Helmut Meyer, CFO Outlook and "MOVE" programme Dr.-Ing. Helmut Leube, Chairman of the Management Board Appendix Annual Results Press Conference - Financial year 2008 Colo
Slide 14: Overview of key performance indicators financial year 2008
Overview of key performance indicators financial year 2008 Significant decline in unit sales, higher cost of material, start-up losses of DEUTZ Dalian (DDE) and one-off items have negative impact on EBIT - EBIT before one-off items €31.8 million (€95.5 million) thereof DDE start-up losses €11.1 mi
Slide 15: Key performance indicators: EBIT before one-off items
Key performance indicators: EBIT before one-off items € million -66.7% 95.5 5.5 44.7 24.5 31.8 45.3 13.4 -12.1 47.1 11.2 11.9 -13.6 -0,1 -22.6 -1,7 -1.4 FY 2007 FY 2008 Q4 2007 Q4 2008 EBIT margin 6.3% 2.1% 5.8% -3.8% Compact Engines DEUTZ Customised Solutions Other Annual Results Press Conference -
Slide 16: Key performance indicators: R&D and capital expenditure
Key performance indicators: R&D and capital expenditure € million R&D Capital expenditure +61.8% -29.5% 90.3 167.8**) 7.3 11.6 160.5**) 78.7 118.1 55.8 11.5 8.5 106.6 47.3 2007 2008 2007 2008 R&D ratio*) 3.7% 6.0% Planned investments for capacity expansion were Increased expenditures for R&D in
Slide 17: Key performance indicators: net financial position and working capital
Key performance indicators: net financial position and working capital € million Net financial position Working capital +4.1% 205.0 89.7 196.9 -12.2 Working 2007 2008 2007 2008 capital ratio (ø) 13.3% 16.2% Previous year's value influenced by inflow of funds Increased inventories result in highe
Slide 18: Financial liabilities and due dates
Financial liabilities and due dates € million 31 Dec. 2008 31 Dec. 2007 Convertible bonds -- 2.7 Bond (U.S. private placement)*) 196.2 190.1 Liabilities to banks 23.4 28.5 Liabilities from finance leases 0.1 0.1 Total 219.7 221.4 *) amount of bond on date of placement: $274 million Total financial l
Slide 19: Agenda
Agenda Overview of FY 2008 Dr.-Ing. Helmut Leube, Chairman of the Management Board Key performance indicators for FY 2008 Helmut Meyer, CFO Outlook and "MOVE" programme Dr.-Ing. Helmut Leube, Chairman of the Management Board Appendix Annual Results Press Conference - Financial year 2008 Colo
Slide 20: Outlook FY 2009
Great economic uncertainty makes it difficult to make reliable forecasts Outlook FY 2009 New orders/unit sales/revenue significantly below previous year EBIT slightly positive operating earnings + successful implementation of "MOVE" at the level of FY 2008*), Capital expenditure (excl. R&D) flexible
Slide 21: DEUTZ MOVE programme
DEUTZ "MOVE" programme MOVE Programme to safeguard earnings and future viability Short-term measures for safeguarding profitability focus in 2009 Reduction of overhead cost (personnel and administrative costs) Reduction of cost of materials Adjustment of employee working hours to changed unit
Slide 22: Adjustment of workforce structures to the changed unit sales situation
Adjustment of workforce structures to the changed unit sales situation Number of flex-time employees significantly reduced since mid-year - 06/2008: about 1,200 persons, 12/2008: about 400 persons - Expiry of additional temporary contracts throughout 2009 Short-time work since December 2008 - FY
Slide 23: 21st century challenges for R&D: tightened limits, reduced emissions
21st century challenges for R&D: tightened limits, reduced emissions Particulates [g/kWh] 10 0,9 1999 to 2014: Particulates and nitrogen oxides (NOx) must each be reduced by approximately 96% 0,8 Engine manufacturers are responsible for compliance with limits 0,7 US Tier 1 / EU Stage I 0,6 75 -
Slide 24: 21st century challenges for R&D: additional technologies
21st century challenges for R&D: more stringent directives require additional technologies 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 kW 130 – 560 75 – 130 Engine-internal and engine-external Engine-internal 56 – 75 measures measures 37 – 56 19 – 37 Constant Speed EU Stage II EU Stage III A E
Slide 25: Installation impacts of EU Stage III B and IV technology
Installation impacts brought about by EU Stage III B and EU Stage IV technology – design study for Stage IV / 4 litre engine Min. 30 L equipment-side components Engine-side components approximately 80 L ? L components or open space for ventilating the engine compartment*) Total Metering pump: 10 L a
Slide 26: Closing statement by Dr. Helmut Leube
“All in all, the prospects are very good that DEUTZ will quickly be able to return to its path of profitable growth once the economic crisis has passed.” Dr.-Ing. Helmut Leube Chairman of the Management Board of DEUTZ AG Annual Results Press Conference - Financial year 2008 Cologne, 19 March 2009 26
Slide 27: Agenda
Agenda Overview of FY 2008 Dr.-Ing. Helmut Leube, Chairman of the Management Board Key performance indicators for FY 2008 Helmut Meyer, CFO Outlook and "MOVE" programme Dr.-Ing. Helmut Leube, Chairman of the Management Board Appendix Annual Results Press Conference - Financial year 2008 Colo
Slide 28: Overview of key performance indicators (I)
Overview of key performance indicators (I) € million 2008 2007 Delta in % Revenue 1,495.0 1,524.2 -1.9 EBITDA 91.9 161.0 -42.9 EBIT 17.5 95.5 -81.7 EBIT before one-off items 31.8 95.5 -66.7 EBIT margin 1.2 6.3 -- EBIT margin before one-off items (in %) 2.1 6.3 -- Net income -4.2 59.4 -- Basic earnin
Slide 29: Overview of key performance indicators (II)
Overview of key performance indicators (II) € million 2008 2007 Delta in % Total equity and liabilities 1,206.3 1,378.6 -12.5 Equity 511.3 557.1 -8.2 Equity ratio (%) 42.4 40.4 -- Cash flow from operating activities 89.7 -38.7 -- Free cash flow -23.3 -111.5 79.1 Net financial position -12.2 89.7 --
Slide 30: Income statement
Income statement € million 2008 2007 Delta in % Revenue 1,495.0 1,524.2 -1.9 Change in inventories and other own work capitalised 25.4 30.1 -15.6 Other operating income 65.0 66.7 -2.5 Cost of materials -1,039.7 -1,029.7 1.0 Staff costs -290.0 -275.0 5.5 Depreciation and amortisation -71.8 -65.5 9.6
Slide 31: Balance sheet: assets
Balance sheet: assets Assets, in € million 31 Dec 2008 31 Dec. 2007 Delta in % Non-current assets (before deferred tax assets) 539.7 511.3 5.6 Deferred tax assets 33.1 49.4 -33.0 Inventories 222.0 214.2 3.6 Trade receivables 121.1 188.8 -35.9 Other receivables and assets 82.0 102.9 -20.3 Cash and ca
Slide 32: Balance sheet: equity and liabilities
Balance sheet: equity and liabilities Equity and liabilities, in € million 31.12.2008 31.12.2007 Delta in % Equity 511.3 557.1 -8.2 Provisions for pensions and similar obligations 169.3 176.7 -4.2 Deferred tax provisions 0.1 -- -- Other provisions 45.7 46.5 -1.7 Financial liabilities 214.1 216.0 -0.
Slide 33: Summary cash flow statement
Summary cash flow statement € million 31.12.2008 31.12.2007 EBIT 17.5 95.5 Cash flow from operating activities (continuing operations) 89.7 -38.7 Cash flow from operating activities (discontinued operations) 0.0 -9.1 Cash flow from operating activities (total) 89.7 -47.8 Capital expenditure on intan
Slide 34: Segments overview FY 2008
Segments overview FY 2008 FY FY Delta FY FY Delta New orders (€ million) 2008 2007 in % Unit sales (units) 2008 2007 in % Compact Engines 1,032.5 1,203.9 -14.2 Compact Engines 219,681 248,971 -11,8 DEUTZ Customised Solutions 331.0 380.6 -13.0 DEUTZ Customised Solutions 32,678 36,890 -11,4 Total acti
Slide 35: Segments overview Q4 2008
Segments overview Q4 2008 Q4 Q4 Delta Q4 Q4 Delta New orders (€ million) 2008 2007 in % Unit sales (units) 2008 2007 in % Compact Engines 158.2 280.5 -43.6 Compact Engines 36,297 67,661 -46.4 DEUTZ Customised Solutions 54.4 88.6 -38.6 DEUTZ Customised Solutions 8,571 11,790 -27.3 Total activities 21
Slide 36: Financial Dates 2009
Financial Dates 2009 Annual Results press conference Cologne 19 March 2009 Publication Annual Report 2008 Analysts' meeting Frankfurt/Main 20 March 2009 Annual General Meeting Cologne 30 April 2009 Publication Report 1st Quarter 2009 7 May 2009 Conference call with analysts and investors P
Slide 37: Contact
Contact DEUTZ AG Gerhard Zaiss Corporate Communications Ottostrasse 1 51149 Cologne (Porz-Eil) Phone: +49 (0)221 822 2455 Fax: +49 (0)221 822 15 2455 E-mail: zaiss.g@deutz.com www.deutz.com Annual Results Press Conference - Financial year 2008 Cologne, 19 March 2009 37
Slide 38: Disclaimer
Disclaimer All financial data in this presentation relates to continuing operations unless otherwise stated. The details given in this document are based on the information available at the time it was prepared. This presents the risk that actual figures may differ from forward-looking statements. S