Trelleborg AB Class B · OMXSTO:TREL_B
Trelleborg AB Class B — Q3 2006 Earnings Presentation
28 slides from Trelleborg AB Class B's earnings presentation, Oct 27, 2006
Slide 1: Welcome to 2006 Nine Month Report Update
Welcome to 2006 Nine Month Report Update October 27, 2006
Slide 2: Group Highlights
Group Highlights d Nine months Sales increase of 13 % - organic growth 4.2 % d Group nine months Net Sales rose to 20,342 SEK M (17,988) d Net Sales Q3 6,306 SEK M (5,846) d Group Organic Growth for Q3 1.7 % and for nine months 4.2 % d Continous good development in non-auto businesses d Q3 Operating
Slide 3: EMU Purchasing managers index vs Ind. Production
EMU Purchasing managers index vs Ind. Production Percent change y/y Index SEAL DAMP PROTECT Source: Reuters EcoWin
Slide 4: USA: ISM purchasing managers index vs Ind. production
USA: ISM purchasing managers index vs Ind. production US Industrial Production and ISM 15,0 65,0 12,5 62,5 10,0 60,0 7,5 57,5 Percent change y/y 5,0 55,0 Index 2,5 52,5 0,0 50,0 -2,5 47,5 -5,0 45,0 -7,5 42,5 -10,0 40,0 97 98 99 00 01 02 03 04 05 06 0 Business Surveys, ISM Manufacturing, PMI total SE
Slide 5: Q3 sales & production down in both N. America and Europe
Q3 sales & production down in both N. America and Europe GROUP Light vehicles, Quarterly change YoY NA light vehicle production, European light vehicle production, thousand units thousand units 6,000 6,000 5,000 5,000 4,000 4,000 3,000 3,000 2,000 2,000 1,000 1,000 0 0 Q3’04 Q3’05 Q3’06 Q3’04 Q3’05
Slide 6: Continous good growth in several segments
Continous good growth in several segments Trelleborg Sealing Solutions Q3 EBIT 170 SEK M (170) R12 EBIT 704 SEK M (703 FY05) 2100 210 Organic growth Q3: 6.3 % and 9M: 2.5 % Repositioning of product portfolio continues 1800 180 Good demand and sales in industrial and aerospace segments. Organic
Slide 7: Stable sales could not compensate for higher raw material costs
Stable sales could not compensate for higher raw material costs Trelleborg Automotive 3000 Q3 net sales 2,134 SEK M (2,166) 300 Organic sales growth, 9M: 5.4 % R12 net sales 9,537 SEK M (8,995 FY05) Q3 Sales increased in both AVS and Fluid&Acoustic segments 2500 250 Lower NA light vehicle prod
Slide 8: Big 3 (Ford, GM, DCX) part of sales
Big 3 (Ford, GM, DCX) part of sales Business Area Global sales by Geographical Area, % Asia, 7 % Americas, 26 % Europe, 67 % Big 3 US share of BA global sales, % BA Product Mix in US, % Big 3 in US, 20 % Passenger Cars, 51 % Light Trucks, 49 % Incl SUVs SEAL DAMP PROTECT Source: Trelleborg Estimates
Slide 9: Continous growth and focus on portfolio management
Continous growth and focus on portfolio management Q3 net sales 1,498 SEK M (1,005) Trelleborg Engineered Systems R12 net sales 5,880 SEK M (4,438 FY05) 1600 160 Organic growth 9M: 12.9 % Good and stable demand in most segments 1400 140 effected both sales and profits positively 1200 120 Large
Slide 10: Acquisition of Reeves Brothers Inc.
Acquisition of Reeves Brothers Inc. Trelleborg creates a world leading position in polymer-coated high-precision materials Turnover of approx. 1,400 MSEK Approx. 1,000 employees Head office in Spartanburg, South Carolina, US 2 production units in US, 1 in Italy and 1 in China Profit margin
Slide 11: Rationales for the acquisition of Reeves
Rationales for the acquisition of Reeves Strategic fit with several of the Trelleborg Group’s own positions Polymer-coated high-precision materials Adds technical, manufacturing and market expertise in prioritized growth segments Global leadership in polymer based systems for printing blanke
Slide 12: Global footprint for Reeves
Global footprint for Reeves Lodi Vecchio, Italy Manufacturing Printing Products Rutherfordton, NC Engineered Coated Fabrics Manufacturing (296 employees) Engineered Coated Products (240 employees) Shanghai, China Manufacturing Printing Products (138 employees) Spartanburg, SC Admin & Manufacturing P
Slide 13: Reeves is organised in two divisions based on similar technology
Reeves is organised in two divisions based on similar technology SEAL DAMP Printing Blankets Engineered Fabrics PROTECT
Slide 14: Market overview Coated Fabrics
Market overview Coated Fabrics 5 BUSD Global Coated Fabrics market Highly fragmented with > 300 manufacturers 75% of market served by non-rubber coated fabrics – primarily PVC Highest volume applications include automotive interior, wall coverings and furniture 500-700 MUSD 500-700 MUSD Printing bla
Slide 15: Reeves adds to our portfolio of polymer-coated high-precision materials
Reeves adds to our portfolio of polymer-coated high-precision materials Pneumatic Protective Fenders Products Inflatable Gangways products Defence Applications Engineered Applications Rubber sheeting Polymer-coated high precision materials Aircraft Safety Trelleborg portfolio Auto Overlapping portfo
Slide 16: New factory for Syntactic Materials and Glass Microballoons
New factory for Syntactic Materials and Glass Microballoons Approx. 50 MSEK investment. 7,500 square metres. Significant increase of capacity Syntactic Materials Unique composites for the uniform entrainment of reinforced air Glass Microballoons Free-flowing Hollow Glass Spheres SEAL DAMP PROTECT
Slide 17: Continously stable sales development
Continously stable sales development Trelleborg Wheel Systems Q3 net sales 728 SEK M (721) R12 net sales 3,124 SEK M (3,023 FY05) 1000 100 Organic growth 9M: 3.1 % Stable demand in Agricultural segment. Increased sales for Industrial segment. 800 80 Increased sales in growth markets Increased
Slide 18: Rebranding Campaign – Trelleborg TM
Rebranding Campaign – Trelleborg TM SEAL DAMP PROTECT
Slide 19: Improved sales and profits in Q3
Improved sales and profits in Q3 Q3 EBIT 84 SEK M (73) Trelleborg Building Systems R12 EBIT 196 SEK M (197 FY05) 1000 100 Organic growth 9M: 5.5 % Q3 net sales 704 SEK M (626) R12 net sales 2,529 SEK M Generally good demand in all markets (2,304 FY05) 800 80 Results effected positively by In
Slide 20: Strengthening roofing activities in Nordic region
Strengthening roofing activities in Nordic region agreement in principle to acquire Hetags Danish roofing operations Rationales for the acquisition include; Strengthened market position in Denmark, administrative and logistics synergies. Agreement includes operations of Hetag Tagmaterialer A/S (Ro
Slide 21: Raw materials still on a high level at a Year-on-Year comparison
Raw materials still on a high level at a Year-on-Year comparison Historically very high price levels in 2006 Price impact (positive or negative) laggs behind by 3-9 months Higher raw material prices in Q4 compared to the same period previous year. Negative effects expected on Group level also
Slide 22: Operating Profit
Operating Profit Operating profit July - Sep Jan - Sep Oct 2005 - Full year SEK M 2006 2005 2006 2005 Sep 2006 2005 Continuing operations excluding restructuring costs and impairment losses Trelleborg Automotive -26 85 183 357 297 471 Trelleborg Sealing Solutions 170 170 544 543 704 703 Trelleborg E
Slide 23: Key operating ratios
Key operating ratios July - Sep Jan - Sep Oct 2005 - Full year Operating key ratios 2005 2006 2006 2005 Sep 2006 2005 Continuing operations excluding restructuring costs and impairment losses Operating profit 364 413 1 339 1 343 1 734 1 738 Profit before tax 285 381 1 116 1 193 1 453 1 530 Profit fo
Slide 24: Income Statement
Income Statement Income Statements Group July - Sep Jan - Sep Oct 2005 - Full year SEK M 2006 2005 2006 2005 Sep 2006 2005 Continuing operations Net sales 6 306 5 677 20 096 17 504 26 101 23 509 Cost of goods sold -4 744 -4 179 -15 050 -12 787 -19 505 -17 242 Gross profit 1 562 1 498 5 046 4 717 6 5
Slide 25: Cash Flow Report
Cash Flow Report Trelleborg Group, SEK M Change Total cash flow EBITDA, Capital Fixed in excl. assoc. expendi- assets working Jan - Sept companies ture sold capital 2006 2005 R12 Trelleborg Automotive 532 -348 3 -93 94 364 149 Trelleborg Sealing Solutions 690 -115 57 -97 535 411 834 Trelleborg Engin
Slide 26: Q3 Earnings Per Share SEK 2.20 (3.00)
Q3 Earnings Per Share SEK 2.20 (3.00) Earnings per share, Light Blue, and also for continuing operations excl. restructuring costs/impairment losses, Blue , SEK 5,00 3,90 3,85 4,00 3,30 3,35 3,15 3,10 3,20 3,10 3,05 3,00 2,95 3,00 2,70 2,65 2,55 2,60 2,20 2,20 2,00 1,00 0,00 -1,00 -0,75 Q3 Q4 Q1 Q2
Slide 27: Outlook for the fourth quarter 2006
Outlook for the fourth quarter 2006 ▼ Within industry in general, continued good growth is forecasted. ▼ Demand is expected to remain very strong within the aerospace industry and oil and gas segments. ▼ Within automotive-related operations, the announced production cuts, mainly among North American
Slide 28: More details on this report
More details on this report can be found on www.trelleborg.com. Calendar Full Year Report February 13, 2007 This report contains forward-looking 1st Quarter Report April 25, 2007 statements that are based on the current expectations of the management of Trelleborg. Although management believes that