Volvo AB Class A · OMXSTO:VOLV_A

Volvo AB Class A — Q3 2001 Earnings Presentation

26 slides from Volvo AB Class A's earnings presentation, Oct 24, 2001

  1. Slide 1: First Nine Months 2001 Telephone conference

    Volvo Group First Nine Months 2001 Telephone conference October 24, 2001 AB Volvo Pressconf-Q2/010724/

  2. Slide 2: Highlights

    Volvo Group Highlights 1 Third Quarter In Focus Going Forward l Weak earnings - positive Cash Flow Short Term - Positive Cash Flow in all Business Areas l Adapting to changing market conditions l Exciting new products - Continuous adjustment of capacity - New Renault Magnum Truck - Focus on generati

  3. Slide 3: Sales by Market Area

    Volvo Group Sales by Market Area 2 First Nine Months 2001 Percent of Third Quarter Change First Nine Months Change SEK M Total 2001 2000 % 2001 % Western Europe 49 20,124 13,565 48 67,445 53 Eastern Europe 3 1,328 744 78 3,954 68 North America 33 13,381 9,234 45 42,176 46 South America 4 1,439 1,414

  4. Slide 4: Sales by Business Area

    Volvo Group Sales by Business Area 3 First Nine Months 2001 Percent of Total Third Quarter Change First Nine Months Change SEK M % 2001 2000 % 2001 % Global Trucks 64 26,354 13,635 93 86,444 94 Buses 10 4,001 3,883 3 12,631 3 Construction Equipm. 13 5,388 4,804 12 16,143 8 Marine & Ind. Power Sys. 4

  5. Slide 5: Operating Income by Business Area

    Volvo Group Operating Income by Business Area 4 Third Quarter Change First Nine Months Change SEK M 2001 2000 % 2001 % Global Trucks (340) 53 na 449 (38) Buses (185) 65 na (293) na Construction Equipm. 266 282 (6) 755 (43) Marine & Ind. Power Sys. 141 121 17 530 26 Aero 118 72 64 564 23 Financial Se

  6. Slide 6: Renault V.I. And Mack Integration

    Volvo Group Renault V.I. And Mack Integration 5 Restructuring Costs Q3 - 2001 • Winnsboro closure • Consolidate support functions • Strengthening customer support system and product offering Restructuring Cost SEK 1280M AB Volvo Pressconf-Q2/010724/

  7. Slide 7: First Nine Months 2001 Consolidated Results

    Volvo Group First Nine Months 2001 Consolidated Results 6 Third Quarter Change First Nine Months Change SEK M 2001 2000 % 2001 2000 % Net sales 41,134 27,911 47 131,982 87,155 51 Gross income 7,101 5,086 40 22,826 16,596 37 R&D expenses (1,279)¹ (1,122) (4,030) 2 (3,585) Selling expenses (3,444) (2,

  8. Slide 8: First nine months 2001 Consolidated Results (normalized)

    Volvo Group First nine months 2001 Consolidated Results 7 First nine months Adjustments Normalized Change SEK M 2001 2000 2001 2000 2001 2000 % Sales 131,982 87,155 131,982 87,155 51 Operating income (312) 4,998 636¹ (1619)² 324 3,379 Financial Net (1,007) (139) (1,007) (139) Income after fin. items

  9. Slide 9: Global Trucks

    Volvo Group Volvo Global Trucks 8 First Nine Months 2001 Third Quarter First Nine Months SEK M 2001 2000 1) Change 2001 Change Volume (units) 31 142 39 008 (20%) 113 226 (16%) Sales 26 354 25 661 3% 86 444 1% Operating income (340) 2) 36 n/a 449 (68%) Operating margin (1.3%) 0.1% -1.4 0.5% (0.3) ROC

  10. Slide 10: Global Trucks Deliveries

    Volvo Group Volvo Global Trucks 9 Deliveries - y.t.d. Jan - Sep Change Units 2001 2000 % Total Europe 70 979 76 013 (7) of which: Western Europe 66 057 71 506 (8) Eastern Europe 4 922 4 507 9 North America 26 982 44 144 (39) South America 4 406 3 797 16 Net orders: • Europe -3% Asia 3 955 4 694 (16)

  11. Slide 11: Heavy Trucks in North America

    Volvo Group Volvo Global Trucks 10 Heavy Trucks in North America Units 30 000 25 000 Industry build Industry Build Market situation first 9 months Net Order Intake • Industry build rate above order 20 000 intake • Continued price pressure 15 000 • Tough dealer situation 10 000 • Major restructuring

  12. Slide 12: Cash Flow Activities - Cash2 Grow Program

    Volvo Group Cash Flow Activities - Cash2 Grow Program 11 • Education and training - on going þ •dd. • Communication - on going þ. • Activity plans and task forces - on going þ. • Bonus system þ. • Internal benchmarking - ongoing þ. • Strict Investment policy þ. • Strict Credit Limit Management þ. AB

  13. Slide 13: Activity List First 300 Days

    Volvo Group Activity List First 300 Days 12 Integration Volvo Trucks / Renault V.I. / Mack First 100 days Third 100 days þþ Secure Securestart-up start-upcapturing þ capturing þCore CoreProject Projectprogram programrollout rollout þþ Implement Implementglobal globalorganization organizationand and

  14. Slide 14: Renault Magnum

    Volvo Group 13 Renault Magnum • New cab exterior • New interior • Improved vehicle safety • Euro 3 engines AB Volvo Pressconf-Q2/010724/

  15. Slide 15: Global Trucks Summary

    Volvo Group Volvo Global Trucks 14 Summary •• European Europeanmarkets marketsholding holdingup up •• North NorthAmerican Americanmarket marketnot notimproving improving •• Core CoreProject ProjectProgram Programrolled rolledout out •• Major Majorrestructuring restructuringprogram programininNorth N

  16. Slide 16: Buses

    Volvo Group Volvo Buses First Nine Months 2001 Third Quarter First Nine Months SEK M 2001 2000 Change, % 2001 Change, % Volume (units) 2,318 2,636 (12) 7,162 (11) Sales 4,001 3,883 3 12,631 3 Operating income (185)¹ 65 na (293) na Operating margin (4.6)% 1.7% (6.3) (2.3)% (4.6) ROC, 12M (3.1)% 6.5%

  17. Slide 17: Volvo awarded: Bus Builder of the year 2002

    Volvo Group 16 Volvo awarded: Bus Builder of the year 2002 for the new product range and Grand Prix Daniël Parmentier for the best and safest coach exhibit on Busworld 2001 show AB Volvo Pressconf-Q2/010724/

  18. Slide 18: Construction Equipment

    Volvo Group Volvo Construction Equipment 17 First Nine Months 2001 Third Quarter First Nine Months SEK M 2001 2000 Change, % 2001 Change, % Sales 5,388 4,804 12 16,143 8 Operating income 266¹ 282 (6) 755 (43) Operating margin 4.9% 5.9% (1.0) 4,7% (4.3) ROC, 12M 8.4% 17.6% (9.2) 8.4% (9.2) Highlights

  19. Slide 19: Crawler Excavators

    Volvo Group 18 Crawler Crawler Excavators Excavators Volvo EC140 Volvo EC150 Volvo EC160 Volvo EC210 Volvo EC240 Volvo EC290 Volvo EC360 Volvo EC460 AB Volvo Pressconf-Q2/010724/

  20. Slide 20: Articulated Haulers

    Volvo Group 19 Articulated Haulers Volvo A20C 6x6 Volvo A25C 4x4 Volvo A25C 6x6 Volvo A25C 6x6 Volvo A25C 6x6 Volvo A30C 6x6 Volvo A35D 6x6 Volvo A40D 6x6 Container Light Material AB Volvo Pressconf-Q2/010724/

  21. Slide 21: Volvo Penta

    Volvo Group Volvo Penta 20 First Nine Months 2001 Third Quarter First Nine Months SEK M 2001 2000 Change, % 2001 Change, % Sales 1,774 1,610 10 5,486 12 Operating income 141¹ 121 17 530 26 Operating margin 7.9% 7.5% 0.4 9.7% 1.1 ROC, 12M 48,4% 42,0% 6.4 48,4% 6,4 Highlights In Focus • Strong sales d

  22. Slide 22: Volvo Penta D2-55

    Volvo Group Volvo Penta D2-55 21 AB Volvo Pressconf-Q2/010724/

  23. Slide 23: Volvo Penta KAD300/DP

    Volvo Group 22 Volvo Penta KAD300/DP AB Volvo Pressconf-Q2/010724/

  24. Slide 24: Aero

    Volvo Group Volvo Aero 23 First Nine Months 2001 Third Quarter First Nine Months SEK M 2001 2000 Change, % 2001 Change, % Sales 2,994 2,814 6 8,661 11 Operating income 118¹ 72 64 564 23 Operating margin 3.9% 2.6% 1.3 6.5% 0.6 ROC, 12M excl. Aero Serv. 22,2% 28,3% (6.1) 22,2% (6.1) Highlights In Focu

  25. Slide 25: Financial Services

    Volvo Group Volvo Financial Services 24 First Nine Months 2001 Third quarter Nine months SEK M 2001 2000 Change, % 2001 Change,% Operating income 69 220 (69) 245 (82) ROE 5.2% 17.0% (11.8) 5.2% (11.8) Assets, MSEK 72,614 63,144 15 72,614 15 Equity ratio 11,0% 11,7% (0,7) 11,0% (0,7) Highlights In Fo

  26. Slide 26: Summary

    Volvo Group Summary 25 l Business conditions - Continued recession in North America - Downturn in Europe l Cyclical adjustments and structural changes l Focus on generating positive cash flow l Global Trucks - Integration proceeding on schedule - Major restructuring program in North America l Exciti

Volvo Group — Q3 2001 Earnings Presentation on 6ix