Slide 1: Results Presentation FY2021
Results Presentation FY2021 24 February 2022
Slide 2: Table of contents
Table of contents 1. Key Highlights 2. Other materials I. Business performance II. Financial results ANNEX 1
Slide 3: Key Highlights
Key Highlights Manufacturing activity: Maintenance Challenging activity recovery: inflationary >90% environment Commercial Health and Safety: activity: 8.51 AFI1 519 €m new orders 0.25 ASI2 (0.9x Book-to-bill) I. Business performance FY22 Outlook: III. Outlook II. Financial - >13% EBITDA results Pro
Slide 4: I. Business performance (I/III)
I. Business performance (I/III) ORP1 main figures ▪ Talgo Operational Excellence Model consider Health & Safety as main priority, with a clear objective to 2019 2020 2021 2 target zero accidents in the business activity. Frequency Index: Talgo 7.47 7.85 8.51 ▪ Strong measures still in place for the
Slide 5: I. Business performance (II/III)
I. Business performance (II/III) ▪ Challenging environment with increasing prices and Main figures 2021 supply chain disruptions still in place, which has led Talgo to adapt operations, thus strengthening its business model to enhance efficiency and productivity. ✓ Maint. activity International: 100
Slide 6: I. Business performance (III/III)
I. Business performance (III/III) ▪ High quality backlog with 519 €m of new orders Main figures 2021 signed in 2021. o Manufacturing of VHS locomotives for RENFE (Spain) and extensions of current project for DSB (Denmark). ✓ Order intake: 519 €m o Overhaul and refurbishment projects in Spain. ✓ Pipe
Slide 7: II. Financial results – P&L
II. Financial results – P&L ▪ High Revenue recognition driven by manufacturing Main figures 2021 activity in the period and supported by recovery of maintenance services. ▪ Reaching cost-cutting measures objectives, (objective to reduce by 15% the overhead expenses in ✓ Revenues reached 555 €m the p
Slide 8: II. Financial results – Balance Sheet (I/II)
II. Financial results – Balance Sheet (I/II) Main figures 2021 ▪ Positive working capital performance in the year. ▪ Capex in line with expectations (25 €m), highly ✓ Working Capital: 156 €m focused on R&D activities (14 €m), highlighting the (28% over revenues) development of green technologies and
Slide 9: II. Financial results – Balance Sheet (II/II)
II. Financial results – Balance Sheet (II/II) Main figures 2021 ▪ Sound financial profile with reduced leverage ratios in the year despite a higher manufacturing activity. ✓ Net Debt1: 36 €m (0.5x Adj. EBITDA) ▪ Financial debt was renegotiated in 2021…: - Avg. debt cost: 1.0% o Maturity extended (fr
Slide 10: III – Outlook FY2021 review and FY2022 targets
III – Outlook FY2021 review and FY2022 targets Performance Targets FY2021 FY2022 Profitability ✓ Adjusted EBITDA FY2021: 11-12% P 12% >13%1 ✓ WC in 2021: Contained cash consumption P +16 €m Cash consumption Capital structure ✓ Net Debt in 2021: c. 1.2x Adj. EBITDA P 0.5x c. 1.5x ✓ Capex in 2021: c.
Slide 11: Table of contents
Table of contents 1. Key Highlights 2. Other materials I. Business performance II. Financial results ANNEX 10
Slide 12: Commercial activity
Commercial activity Order intake (€m) Pipeline by geographical region 2022-2023(1) LTM2 Book- 8% to-bill ratio 2.8x 0.8x 0.9x 14% 1,134 9.4 €bn1 72% Avg. 3y5: 680 €m (1.4x Book-to-bill ratio) 519 22% 387 Europe MENA APAC Other 2019 2020 2021 ▪ Order intake amounted to 519 €m in FY2021, of ▪ Positive
Slide 13: Backlog breakdown
Backlog breakdown Backlog 2021 (€m) LTM times1 8.3x 6.5x 5.9x Revenues Manufacturing 0.8 €bn (25%) 3,347 Maintenance 3.2 €bn 3,249 2.2 €bn (69%) 3,184 Remodelling 0.1 €bn (5%) 2019 2020 2021 ▪ Backlog as of December 2021 amounted to 3.2 €bn which provides: o High level of industrial activity expecte
Slide 14: Manufacturing projects – High Speed
Manufacturing projects – High Speed Backlog 2021 (€m) Renfe Avril VHS (Spain) ▪ Project scope – 900 €m: Manufacturing o Manufacture of 30 VHS “Avril” trains. 0.8 €bn (25%) o Maintenance for a period of 30 years1. ▪ Project execution: o In last manufacturing phases and already 3.2 €bn under testing a
Slide 15: Manufacturing projects – Long distance / Passenger coaches
Manufacturing projects – Long distance / Passenger coaches Backlog 2021 (€m) DB Talgo 230 km/h (Germany) ▪ Project scope – 550 €m (2.3 €bn)1: Manufacturing o Framework contract for the manufacture of up to 0.8 €bn (25%) 100 Talgo 230 trains. o Initial order for the manufacture of 23 trains. o Mainte
Slide 16: Light maintenance projects
Light maintenance projects Backlog 2021 (€m) Fleet maintained in # of units(1) 3,580 2,806 2,452 3.2 €bn Maintenance + 354 units 2.2 €bn (69%) + 2.3% CAGR 2015 2021 2023E ▪ Covid-19 mobility restrictions have progressively been lifted-up in the last months, thus resuming normal services in almost al
Slide 17: Overhaul / heavy maintenance projects
Overhaul / heavy maintenance projects Backlog 2021 (€m) Conversion of night trains into VHS (Spain) ▪ Project scope – 107 €m: Overhaul o Conversion of Talgo S7 compositions(1). 0.1 €bn (5%) o The initial project includes 156 coaches (13 compositions) with an option for additional 72 coaches (6 compo
Slide 18: Table of contents
Table of contents 1. Key Highlights 2. Other materials I. Business performance II. Financial results ANNEX 17
Slide 19: Profit & loss – Revenues
Profit & loss – Revenues Cumulative revenues - YoY (€m) Quarterly revenues (€m) +14% 555.4 147.7 147.1 146.5 133.7 128.4 487.1 122.7 2020 2021 3Q20 4Q20 1Q21 2Q21 3Q21 4Q21 ▪ Revenues increased by 14% to reach 555.4 €m in 2021, reflecting the expected cycle of high revenue recognition: o Manufacturi
Slide 20: Profit & loss – EBITDA and Net Profit
Profit & loss – EBITDA and Net Profit Adjusted EBITDA(1) (€m) and margin (%) Adjusted Net Profit (€m) 35 70 66.2 29.2 30 60 25 50 20 40 34.2 30 11.9% 15 20 7.0% 10 10 5 (7.4) 0 0 2020 2021 -5 -10 Adjusted EBITDA Adj. EBITDA margin 2020 2021 ▪ Talgo is actively implementing measures to adapt it costs
Slide 21: Balance Sheet – Working Capital
Balance Sheet – Working Capital ▪ The Working Capital remained stable in the period at 155.9 €m in 2021, and slightly lower than 1H2021 (172.7 €m) due to measures aimed to improve cash management through cash collection programs and optimization of inventory, among others. ▪ Talgo also started to us
Slide 22: Balance Sheet – Net Financial Debt
Balance Sheet – Net Financial Debt Net Financial Debt (€m)(1) LT bank debt – Repayment schedule (€m) NFD / LTM Adjusted 1.4x 0.5x EBTIDA 88 48.1 109 35.9 52 32 20 2020 2021 2022 2023 2024 2025 >2026 Financial debt breakdown (€m) ▪ Increased average debt maturity from 3.12 to €m 2021 3.40 years in 20
Slide 23: Cash Flow – Free Cash Flow
Cash Flow – Free Cash Flow ▪ EBITDA generated in the period was partially offset mainly by expected Working Capital and capex requirements. However, business generated 16.4 €m of FCF in the period (25% conversion), which contributed to deleverage the balance sheet to reach 0.5x Adjusted Ebitda. ▪ Ca
Slide 24: Table of contents
Table of contents 1. Key Highlights 2. Other materials I. Business performance II. Financial results ANNEX 23
Slide 25: Annex 1. P&L
Annex 1. P&L Profit & Loss Account (€m) 2021 2020 % Change Total net turnover 555.4 487.1 14.0% Other income 12.4 14.8 (15.9%) Procurement costs (317.2) (296.6) 6.9% Employee welfare expenses (142.5) (123.7) 15.2% Other operating expenses (47.5) (53.6) (11.2%) EBITDA 60.6 28.0 116.5% % Ebitda margin
Slide 26: Annex 2. Balance sheet
Annex 2. Balance sheet Balance Sheet (€m) Dec 2021 Dec 2020 Dec 2019 FIXED ASSETS 262.9 257.0 249.9 Tangible + intangible assets 122.0 115.2 106.0 Goodwill 112.4 112.4 112.4 Other long term assets 28.5 29.3 31.5 CURRENT ASSETS 768.6 645.9 632.9 Inventories 133.2 145.3 129.8 Non- current assets held
Slide 27: Annex 2. Balance sheet (2)
Annex 2. Balance sheet (2) Financial debt (€m) Dec 2021 Dec 2020 Dec 2019 Long term financial liabilities 248.1 238.4 198.7 Short term financial liabilities 36.0 41.1 58.6 Financial leasings 4.7 6.9 8.9 Cash & cash equivalents (253.0) (238.3) (325.6) Net financial debt 35.9 48.1 (59.3) Adjusted EBIT
Slide 28: Annex 3. Cash flow statement
Annex 3. Cash flow statement Cash flow statement (€m) 2021 2020 % Change Net income 27.5 (17.4) n.a. Corporate income tax 8.2 5.1 58.5% Depreciation & Amortization 18.6 16.7 11.2% Financial income/Financial expenses 8.1 6.2 31.4% Other result adjustments (5.0) 14.2 n.a. Changes in working capital (1
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