Sandvik Ab · OMXSTO:SAND
Sandvik Ab — Q2 2010 Earnings Presentation
28 slides from Sandvik Ab's earnings presentation, Jul 20, 2010
Slide 1: Sandvik Q2 Interim results
Sandvik Q2 Interim results 20 July 2010 SANDVIK |__|
Slide 2: Quarterly highlights
Quarterly highlights Continued market recovery Increased order intake in all markets Energy, automotive and mining strong drivers Operating profit 3,471 MSEK, 16.8% Lower cost level Increased invoicing and production volumes Favorable product mix Positive metal price and currency eff
Slide 3: Markets
Markets +18% +29% 40% +12% 17% 18% +15% 9% +24% 7% -10% 9% % Invoicing (p/v) Q2 2010, change compared with Q2 2009 % Share of Group total 3
Slide 4: Customer segments
Customer segments Mining Invoicing vs Q2 2009 > 10% Mining 0 to 10% 0 to -10% < -10% Sequential trend from last quarter Mining Pie chart representing share of invoicing 2009 4
Slide 5: Order intake
Order intake MSEK -14% P/V +43% P/V Order intake 23,179 MSEK Change y-o-y +43% 5
Slide 6: Invoicing
Invoicing MSEK -22% P/V +15% P/V Invoicing 20,603 MSEK Change y-o-y +15% 6
Slide 7: Operating profit
Operating profit MSEK Operating profit 3,471 MSEK Operating margin 16.8% 7
Slide 8: Cash flow
Cash flow MSEK Cash flow from operating activities 2,626 MSEK 8
Slide 9: Sandvik Tooling
Sandvik Tooling Continued improved demand Increase in all markets Global automotive production a strong driver Positive price effect Operating profit, 1,283 MSEK, 21.0% Lower cost level Increased sales and production volumes Positive product mix Negative currency effect Net Worki
Slide 10: Sandvik Mining and Construction
Sandvik Mining and Construction Improved demand Improvement in all markets Strong order intake from aftermarket Equipment improved from a low level Invoicing flat but increased from Q1 Operating profit, 1,283 MSEK, 15.3% Lower cost level Increased invoicing and production volumes F
Slide 11: Sandvik Materials Technology
Sandvik Materials Technology Continued improved demand Favorable development in energy, automotive and mining Two new orders to nuclear industry Alloy surcharges contributing 11% to order growth Invoicing increased 23% Alloy surcharges contributed 9% Operating profit, 699 MSEK, 15.1%
Slide 12: Quarterly financials
Quarterly financials vs MSEK Q2 2009 Q2 2010 Q2 2009 Order intake 16,503 23,179 +43%* Invoicing 18,011 20,603 +15%* EBIT -1,985 3,471 - EBIT margin -11.0% 16.8% - Operating cash flow 2,753 2,626 -5% Cash flow after 772 1,770 +129% investing activities * Change in price/volume 12
Slide 13: Bridge analysis
Bridge analysis Price/ Structure, MSEK Q2 2009 volume/ Currency one-offs* Q2 2010 productivity Sandvik Group Invoiced sales 18,011 +2,390 -320 +520 20,603 Operating profit -1,985 +2,660 +160 +2,630 3,471 Profit margin -11.0% +111% - - 16.8% * Includes metal price effects 13
Slide 14: Summary Q2
Summary Q2 Improved demand in all markets Sequential improvement from Q1 Improved operating profit Lower cost level Increased invoicing Increased production rates Favorable product mix Favorable metal price and currency effects Reduced Net Working Capital Good cash flow 14
Slide 15: Q&A session
Sandvik Q2 22) 5 é E A
Slide 16: Back-up slides
Sandvik Q2 Back-up slides
Slide 17: Sandvik Tooling
Sandvik Tooling Q2 2010 Order intake 6,295 MSEK Invoicing 6,122 MSEK EBIT 1,283 MSEK, 21.0% 17
Slide 18: Sandvik Mining and Construction
Sandvik Mining and Construction Q2 2010 Order intake 9,629 MSEK Invoicing 8,375 MSEK EBIT 1,283 MSEK, 15.3% 18
Slide 19: Sandvik Materials Technology
Sandvik Materials Technology Q2 2010 Order intake 5,752 MSEK Invoicing 4,618 MSEK EBIT 699 MSEK, 15.1% 19
Slide 20: Income statement
Income statement MSEK Q2 2009 Q1 2010 Q2 2010 Invoiced sales 18,011 18,534 20,603 Cost of goods sold -14,857 -12,270 -12,683 Gross profit 3,154 18% 6,264 34% 7,920 38% Admin, sales and R&D costs -4,897 -27% -4,340 -23% -4,597 -22% Other operating income and expenses -242 -27 +148 Operating profit -1
Slide 21: Bridge analysis
Bridge analysis Price/ Structure, MSEK Q2 2009 volume/ Currency one-offs Q2 2010 productivity Sandvik Tooling Invoiced sales 4,541 +1,630 -230 +180 6,122 Operating profit -463 +1,200 -100 +640 1,283 Profit margin -10.2% 74% - - 21.0% Sandvik Mining and Construction Invoiced sales 8,487 -150 +40 0 8,
Slide 22: Cash flow
Cash flow MSEK Q2 2009 Q1 2010 Q2 2010 Profit after financial items -2, 443 1,502 3,037 Depreciations, tax etc +1,301 +630 +501 Cash flow from operations before NWC -1,142 +2,132 +3,538 Change in inventories +3,454 +218 -1,301 Change in receivables and liabilities +578 -67 +395 Change in rental flee
Slide 23: Balance sheet
Balance sheet vs MSEK Q2 2009 Q1 2010 Q2 2010 Q2 2009 Intangible fixed assets 15,093 13,721 14,062 -7% Tangible fixed assets 27,620 25,713 26,017 -6% Financial fixed assets 5,504 6,044 6,240 +13% Inventories 24,995 19,401 21,234 -15% Receivables 20,813 18,975 19,993 -4% Cash and cash equivalents 6,0
Slide 24: Loan and duration profile
Loan and duration profile Amount Average MSEK duration Long term 85% US Private Placement 6,700 9 years Fin institutions, EIB, NIB 3,200 4 years Swedish MTN 9,600 5 years European MTN 5,700 4 years Bank loans 2,200 1 year Short term 15% Commercial paper 300 1 months Swedish MTN 2,400 6 months Bank l
Slide 25: Loan maturity profile
Loan maturity profile MSEK 25
Slide 26: Financial key figures
Financial key figures Q2 2009 Q3 2009 Q4 2009 Q1 2010 Q2 2010 Cash flow from 2,753 3,521 3,883 2,287 2,626 operations, MSEK Capex, MSEK 1,120 804 630 515 691 ROCE, 12 months 6.2% 1.3% -1.3% 1.0% 8.8% ROE, 12 months 3.3% -4.0% -7.9% -3.7% 9.5% Net debt/equity ratio 1.2 1.1 1.0 1.0 0.9 EPS, SEK 12 mon
Slide 27: Guidance 2010
Guidance 2010 Metal price effects Given currency rates, stock levels and metal prices at quarter end, no material effect on EBIT is expected for Q3 2010. Currency effects Net financial items Given currency rates at quarter The estimate is -450 MSEK for Q3 end, the effect is estimated to and -1.7 BSE
Slide 28: Cautionary statement
Cautionary statement “Some statements herein are forward-looking and the actual outcome could be materially different. In addition to the factors explicitly commented upon, the actual outcome could be materially effected by other factors like for example, the effect of economic conditions, exchange-