Slide 1: Fixed Income Presentation FY 2020
OK Fixed Income Presentation FY 2020 Daimler AG Daimler AG Fixed Income Presentation | FY 2020 1
Slide 2: Agenda
OK AGENDA I. DAIMLER AG REVIEW FY 2020 II. DIVISIONAL REVIEW FY 2020 III. OUTLOOK 2021 IV. PROJECT FOCUS V. FUNDING VI. SUSTAINABILITY Daimler AG Fixed Income Presentation | FY 2020 2
Slide 3: Daimler: Key messages
Daimler: Key messages Financial targets achieved Restructuring measures increased Strategy in all divisions refocused Future corporate structure planned Significant earnings progress expected in 2021 Daimler AG Fixed Income Presentation | FY 2020 3
Slide 4: Daimler: Key figures
Daimler: Key figures Free Cash Net Industrial Sales Revenue EBIT EBIT adj. in million units in billion euros in billion euros in billion euros Flow (IB) Liquidity in billion euros in billion euros 3.35 172.7 10.3 8.3 17.9 154.3 2.84 8.6 6.6 11.0 4.3 -15% -11% 53% -16% 504% 62% 1.4 2019 2020 2019 202
Slide 5: Daimler 2020 Group EBIT
Daimler 2020 Group EBIT in million euros -1,994 +651 +5,963 10,276 -232 -60 8,641 -2,038 6,603 Mercedes-Benz Cars & Vans: • Legal proceedings -154 • Restructuring measures -1,476 4,313 Daimler Trucks & Buses: • Restructuring measures -153 • Legal Daimler Mobility: proceedings +5,448 • Restructuring
Slide 6: Reconciliation from CFBIT to Free Cash Flow
Daimler 2020 Reconciliation from CFBIT to Free Cash Flow: improved cash flow steering +2,513 -806 in million euros +21 -517 +896 9,155 8,259 7,048 • Legal proceedings +896 CFBIT CFBIT Income Interest Other Free cash flow Adjustments Free cash flow Mercedes-Benz Daimler taxes paid reconciling (indust
Slide 7: Net Industrial Liquidity: achieving a comfortable level of net cash
Daimler Net Industrial Liquidity: achieving a comfortable level of net cash in billion euros +8.7 -8.5 +2.6 -0.4 -1.0 -0.4 17.9 +5.9 Free cash flow industrial business 11.0 FY 2020: € 8,259 million Net industrial Earnings and Working Depreciation and Additions to Investments in Dividend Other Net in
Slide 8: YTD Q4 2020 development of gross industrial liquidity
Daimler YTD Q4 2020 development of gross industrial liquidity Financial Services in billion euros Industrial Business 5.2 -6.6 8.3 11.3 -17.7 -8.6 11.1 0.2 29.4 27.5 -1.2 3.6 3.9 23.7 25.8 Gross Dividend FCF FCF Other ABS New Bond New FX & Gross Liquidity Payment IB DMO Debt Maturities ABS Maturitie
Slide 9: Q4 2020 Financial flexibility over a 12-month period
Daimler Q4 2020 Financial flexibility over a 12-month period in billion euros 70.0 Bridge loan facility Other incl. Net industrial liquidity at €17.9 billion improved significantly 50.5 Fin. Lease ABS potential Commercial Gross industrial liquidity at €25.8 billion paper Bank loans Financial flexibi
Slide 10: 2020 Dividend: Proposal in line with our dividend policy
Daimler 2020 Dividend: Proposal in line with our dividend policy Earnings Net profit Dividend in billion euros per share proposed in euros in euros 4.0 1.35 2.7 3.39 0.9 2.22 48% 53% 50% 2019 2020 2019 2020 2019 2020 Daimler AG Fixed Income Presentation | FY 2020 10
Slide 11: Agenda
OK AGENDA I. DAIMLER AG REVIEW FY 2020 II. DIVISIONAL REVIEW FY 2020 III. OUTLOOK 2021 IV. PROJECT FOCUS V. FUNDING VI. SUSTAINABILITY Fixed Income Presentation | FY 2020 11
Slide 12: Mercedes-Benz Cars: Highlights
Mercedes-Benz Cars: Highlights Mercedes-Benz: The world’s leading luxury car brand; new sales record in China Tripled worldwide xEV sales; met European CO2 targets for passenger cars in 2020; next steps towards “Ambition 2039” New Mercedes-Benz strategy targeting a leading position in electric drive
Slide 13: Mercedes-Benz Cars: Business recovery faster than expected in H2-2020
Mercedes-Benz Cars: Business recovery faster than expected in H2-2020 Group sales of Mercedes-Benz passenger cars per month in thousand units 2019 China Europe United States 80 90 40 70 80 35 60 70 30 60 50 25 50 40 20 40 30 15 30 20 20 10 10 10 5 0 0 0 Jan 20 Dec 20 Jan 20 Dec 20 Jan 20 Dec 20 Daim
Slide 14: Mercedes-Benz Cars: CO2 compliance Europe
Mercedes-Benz Cars: CO2 compliance Europe NEDC WLTP2) Target: 125g3) WLTP Target: 107g NEDC1) 1) Incl. UK and Phase-In, Super Credits & Eco Innovation Credits 2) Excl. UK and Phase-In, Super Credits & Eco Innovation Credits 2019 2020 20212) 3) Target depends on fleet emission value 2020 (NEDC/WLTP)
Slide 15: Mercedes-Benz Cars & Vans: Indicators of change
Mercedes-Benz Cars & Vans: Indicators of change Headcount Fixed Costs R&D Investment in pp&e in thousand employees in billion euros in billion euros in billion euros 177.2 Further improve profitability until 2025** 8.1 170.5 7.2 5.9 Fixed Cost reduction > 20% 4.9 -4% -14% -11% -17% CapEx and R&D red
Slide 16: Mercedes-Benz Cars & Vans financials: CFBIT more than tripled
Mercedes-Benz Cars & Vans financials: CFBIT more than tripled, demonstrating focus on cash flow Sales Revenue EBIT adj. CFBIT adj. in million units in billion euros in billion euros in billion euros 2.82 106.9 7.9 98.6 6.8 2.46 6.2 -13% -8% 11% 308% 1.9 2019 2020 2019 2020 2019 2020 2019 2020 For mo
Slide 17: Mercedes-Benz Cars & Vans EBIT FY & RoS
Mercedes-Benz Cars & Vans EBIT FY & RoS: Lower unit sales, model mix and pricing continued to develop favorably Lower unit sales Favorable Net pricing in million euros Efficiency measures overcompensate expenses for enhanced vehicle equipment and higher level of depreciation Gross profit -1.700 Sign
Slide 18: Mercedes-Benz Cars & Vans Reconciliation from EBIT to CFBIT
Mercedes-Benz Cars & Vans Reconciliation from EBIT to CFBIT: continued cost and cash preservation measures in million euros 7,917 +869 +1,560 +881 7,048 -301 -7,567 +7,303 • Restructuring +301 5,172 • Legal Proceedings +568 EBIT Change in Net financial Net investments Depreciation and Other CFBIT Ad
Slide 19: Daimler Trucks & Buses: Highlights
MD Daimler Trucks & Buses: Highlights Challenging first half of the year with significant sales decrease due to Covid-19; strong comeback in second half Incoming orders recovering fast; order backlog significantly above 2019 level Focus on cash preservation measures incl. strict inventory management
Slide 20: Daimler Trucks & Buses Financials: sales decline from high levels in 2019
Daimler Trucks & Buses Financials: sales decline from high levels in 2019 Sales Revenue EBIT adj. CFBIT adj. in thousand units in billion euros in million euros in billion euros 521 44.4 34.7 379 2,672 2.7 2.5 -27% -22% -75% -5% 678 2019 2020 2019 2020 2019 2020 2019 2020 For more details on financi
Slide 21: Daimler Trucks & Buses EBIT & RoS
Daimler Trucks & Buses EBIT & RoS: Market decrease in our core regions, pricing at the level of the previous year Significantly lower unit sales in all regions due to market downturns Gross profit -2,875 in million euros Significantly lower contribution from aftermarket due to lower demand Negative
Slide 22: Trucks & Buses: Reconciliation from EBIT to CFBIT
Daimler Trucks & Buses: Reconciliation from EBIT to CFBIT: positive impact from a stricter working capital management in million euros +624 2,513 +1,349 +980 -77 -888 525 EBIT Change in Net financial Net investments Depreciation and Provisions, other CFBIT 2020 working capital investments in pp&e an
Slide 23: Daimler Mobility: Highlights
Daimler Mobility: Highlights Continuous high customer support during pandemic driving loyalty & retention Positive effects from cost saving measures Ongoing conservative risk management with strong focus on credit quality Flattening of credit risk reserves in second half of year Mobility services co
Slide 24: Daimler Mobility Financials: Decrease in new business
Daimler Mobility Financials: Decrease in new business in a challenging market environment New Contract EBIT adj. business volume in billion euros in billion euros in billion euros 162.8 74.4 150.6 67.8 1.8 1.6 -9% -8% -13% 2019 2020 2019 2020 2019 2020 For more details on financials please see Daiml
Slide 25: Daimler Mobility EBIT & RoE: Main impact from higher cost of credit risk
Daimler Mobility EBIT & RoE: Main impact from higher cost of credit risk Increase of cost of credit risk due to Covid-19 in million euros Impairment of software in context of streamlining IT-architecture Fixed cost reductions in all areas Gross profit* -490 2,140 -313 1,827 -54 --398 RoE: +184 +61 1
Slide 26: Agenda
OK AGENDA I. DAIMLER AG REVIEW FY 2020 II. DIVISIONAL REVIEW FY 2020 III. OUTLOOK 2021 IV. PROJECT FOCUS V. FUNDING VI. SUSTAINABILITY Daimler AG Fixed Income Presentation | FY 2020 26
Slide 27: Performance: Market Guidance 2021
Performance: Market Guidance 2021 ASSUMPTION Daimler assumes that the economic conditions in our most important markets continue to normalize and in particular that no further setbacks occur as a result of the Covid-19 pandemic. Although bottlenecks in the semiconductor industry will impact sales ma
Slide 28: Performance: Daimler Group Guidance 2021
Performance: Daimler Group Guidance 2021 ASSUMPTION Daimler assumes that the economic conditions in our most important markets continue to normalize and in particular that no further setbacks occur as a result of the Covid-19 pandemic. Although bottlenecks in the semiconductor industry will impact s
Slide 29: Performance: Divisional Guidance 2021
Performance: Divisional Guidance 2021 ASSUMPTION Daimler assumes that the economic conditions in our most important markets continue to normalize and in particular that no further setbacks occur as a result of the Covid-19 pandemic. Although bottlenecks in the semiconductor industry will impact sale
Slide 30: Agenda
OK AGENDA I. DAIMLER AG REVIEW FY 2020 II. DIVISIONAL REVIEW FY 2020 III. OUTLOOK 2021 IV. PROJECT FOCUS V. FUNDING VI. SUSTAINABILITY Daimler AG Fixed Income Presentation | FY 2020 30
Slide 31: Project Focus: two independent businesses with maximum focus
Project Focus: We want to create two independent businesses with maximum focus Today Tomorrow One face to the market Two separate credits Separate ▸ Capital Structure and Rating ▸ Capital Market Access ▸ Group Funding and Liquidity Management Schematic representation for both groups after spin-off D
Slide 32: Daimler Truck AG majority spin-off: key messages
Daimler Project TruckFixed Focus: AG majority Income spin-off: Intended transaction structure and key messages details Strong balance sheet: 18bn Euro Net Industrial liquidity end of 2020 Solid financial position for both entities at Day 1: net industrial liquidity exceeding pensions deficit Daimler
Slide 33: Project Focus: Mercedes-Benz, the pre-eminent luxury car business
Project Focus: Mercedes-Benz, the pre-eminent luxury car business Mercedes-Benz Leading Global “pure play” OEM with unique brand recognition automotive “Ambition 2039” amplifying clear commitment to Sustainability as strategic priority luxury brand Attractive captive financial services business supp
Slide 34: Project Focus: Daimler Truck unlocking the full potential
Project Focus: Daimler Truck unlocking the full potential Daimler Truck Global Global market presence with market-leading brands in triad markets #1 Ready to seize opportunities in emerging markets CV player Leverage existing global platforms to turn scale into profit Lead in Powertrain: technologic
Slide 35: Structure of the planned transaction
Structure of the planned transaction Separate listing of Daimler Truck Distribution of Daimler Truck shares held by Daimler to existing Daimler shareholders Majority in free-float, Daimler ceases control over DT but intends to retain a minority shareholding No additional investment needed from share
Slide 36: Daimler Truck AG majority spin-off: transaction structure and details
Daimler Daimler Truck Truck AGAG majority majority spin-off: spin-off: Intended Intended transaction transaction structure structure and and details details Transfer of the majority of Daimler Truck to Daimler shareholders True independent governance of Attractive financial profiles Prime listing fo
Slide 37: Listing of Daimler Truck planned to be complete by year-end 2021
The listing of Daimler Truck is planned to be complete by year-end 2021 Decision & Extraordinary Listing of Announcement of Shareholder Meeting Daimler Truck Project Focus planned targeted February 3, 2021 May 2021 Fall 2021 End of 2021 Introductory Capital Market Capital Market Day Truck Event for
Slide 38: Agenda
OK AGENDA I. DAIMLER AG REVIEW FY 2020 II. DIVISIONAL REVIEW FY 2020 III. OUTLOOK 2021 IV. PROJECT FOCUS V. FUNDING VI. SUSTAINABILITY Fixed Income Presentation | FY 2020 38
Slide 39: Our funding strategy is built on strict principles
Our funding strategy is built on strict principles No dependence from single markets, instruments, banks or investors Targeting Diversification of funding sources and instruments: Financial Bank Loans, Bonds, ABS, CP, Deposits Independence No Covenants, no MAC, no asset pledges, no CSAs Maximizing K
Slide 40: Portfolio of Daimler Mobility on a high level
Portfolio of Daimler Mobility on a high level Wholesale 163 Loan 154 150 140 Lease 133 117 99 Trucks & Buses about 20% of 84 portfolio Trucks 80 72 74 Others 72 71 68 Portfolio 62 Buses (in bn €) 58 48 38 41 Vans Acquisitions 34 (in bn €) 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Passengers
Slide 41: Daimler Mobility business model: credit management and solid refinancing
Daimler Mobility business model based on stringent credit management and solid refinancing Net credit losses as a percentage of portfolio, subject to credit risk Net credit losses still on a very favorable level, not showing any severe CoViD-19 impact Based on the potential macroeconomic cool-down,
Slide 42: Maturity profile further lengthened
Maturity profile further lengthened in billions of € as of 31 December 2020 Issued in 2020 Maturities 17.8 0.5 14.5 1.4 11.2 3.1 17.3 7.4 0.2 13.1 5.9 2.3 4.3 3.5 8.1 7.2 1.3 3.1 3.0 0.1 2.3 2.0 3.6 3.4 2.2 1.3 3.0 0.5 0.9 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2034 2037 Note: Figure
Slide 43: Financing liabilities show a diversified funding mix
Financing liabilities show a diversified funding mix in billions of € Fin. Lease (IFRS 16) Acc. Deposits Other (ex Fin. Lease) Bank Loans Com. Paper Bonds ABS 161.8 4.2 145.0 0.0 145.8 3.7 2.0 13.9 1.8 1.3 127.4 0.0 12.5 2.8 3.3 13.1 16.6 0.7 117.6 0.0 2.0 11.0 11.8 1.0 1.0 14.5 10.6 1.7 11.5 39.8 1
Slide 44: Balanced mix of funding instruments
To ensure sustainable portfolio growth, we mitigate risk and volatility through a balanced mix of funding instruments Capital Markets Strengthen our global footprint and use market opportunities Other Fin. Lease (IFRS 16) 1% 3% Deepen our excellent Bank Loans bank relationships Bank loans Bank loans
Slide 45: Development to global capital market funding
Consequent development to global capital market funding - diversification will continue Canada EMTN Domestic Bonds Euro Market ABS EMTN Program Korea CP Italian domestic Domestic Bond Prog. Hungarian domestic EUR CP Program ABS China USA Japan Turkey Domestic Bonds 144a / RegS PP Domestic CP ABS CP
Slide 46: Funding base further diversified to a true global set-up
Funding base further diversified to a true global set-up in billions of € 145.8 3% 1% 11% 0% Currency Volume % 10% EUR 39,4 52% USD 22,1 29% CNY 3,3 4% GBP 2,8 4% 22% CAD 2,1 3% Currency Volume % ZAR 1,4 2% EUR 19,5 66% JPY 0,6 1% Fin. Lease (IFRS 16) USD 7,8 27% AUD 0,6 1% 0% 57.3 ZAR 0,8 3% KRW 0,
Slide 47: Financial KPIs set to support a strong rating
Daimler‘s financial KPIs set to support a strong rating Agency Long-term Outlook Short-term Standard & Poor's: BBB+ Stable A-2 Moody’s: A3 Negative P-2 Current Ratings: Fitch: BBB+ Stable F1 DBRS: BBB (high) Stable R-2 (high) Scope: A Stable S-1 Daimler AG Fixed Income Presentation | FY 2020 47
Slide 48: High contributions stabilized funded ratio of pensions
In low interest rate environment high contributions stabilized funded ratio 14 11.5 11.0 12 9.8 10 8.6 8.4 7.4 7.8 in EUR bn 8 6.2 6 3.4 4.5 3.7 Significant contributions of EUR 4 3.1 2 2.2 2.0 1.1 1.9 2.4 0.8 17.3bn since 2010 support the 0.3 0.5 0.7 0.7 0 solid capital structure 2010 2011 2012 201
Slide 49: Agenda
OK AGENDA I. DAIMLER AG REVIEW FY 2020 II. DIVISIONAL REVIEW FY 2020 III. OUTLOOK 2021 IV. PROJECT FOCUS V. FUNDING VI. SUSTAINABILITY Daimler AG Fixed Income Presentation | FY 2020 49
Slide 50: Daimler Group 6 + 3 sustainability topics
Daimler Group 6 + 3 sustainability topics as an integral part Climate protection Resource Livable & air quality conservation cities Traffic safety Data responsibility Human rights Integrity People Partnerships Daimler AG Fixed Income Presentation | FY 2020 50
Slide 51: CO2 neutrality at Mercedes-Benz Cars
CO2 neutrality at Mercedes-Benz Cars 2039 2030 We aim to achieve CO2 neutrality for our new Our goal is to have plug-in 2025 hybrids or all-electric vehicles passenger car fleet by 2039. account for more than 50 2022 Depending on how conditions develop, we plan to have all- percent of our car sales
Slide 52: Daimler Trucks & Buses: Making CO2-neutral transport a reality
Daimler Trucks & Buses: Making CO2-neutral transport a reality 2039 Ambition: By 2039, new vehicles in Europe, Japan and North America will be CO2 Second half neutral in operation (tank-to-wheel). of 2020s Hydrogen-based series- production vehicles in the second half of the decade. 2022 Battery-elec
Slide 53: Daimler Mobility and Mercedes-Benz Bank: CO2-neutral locations
Daimler Mobility und Mercedes-Benz Bank: CO2-neutral locations and administration 2022 Globally CO2-neutral locations and administration. 2020 Sustainability – firmly anchored in our corporate values. Daimler AG Fixed Income Presentation | FY 2020 53
Slide 54: CO2 neutrality at Mercedes-Benz Cars: electric model rollout
CO2 neutrality at Mercedes-Benz Cars 2019 2020 2021 2022 Stay tuned for more EQC EQV Compacts EV Purpose World‘s first fully-electric e.g. EQA, EQB SUVs Frontrunner. premium MVP by Mercedes. eVito Tourer EV Purpose Next generation eVito mid-size van launched in 2018. Limousines smart from China e.g.
Slide 55: Customers may decide for electric or hydrogen
Customers may decide for electric or hydrogen based on their specific needs: GenH2 Truck • Based on fuel cell and hydrogen • Range up to1000km • First customer testing in 2023 • Series production in second half of 2020s Battery Electric Truck: Hydrogen Truck: - Lower Weight, - Heavy Weight, - Shorte
Slide 56: Aim to achieve CO2-neutral production
… and our aim to achieve CO2-neutral production By 2022: CO -neutral production at our Mercedes-Benz Car and Van plants worldwide* 2 By 2022: CO -neutral production at our European plants of Daimler Trucks & Buses* 2 By 2030: Fifty percent CO emissions reductions from production operations 2 SBTI By
Slide 57: Committed investments as part of our electrification strategy
Committed investments as part of our electrification strategy €10 bn About €10 billion to expand our fleet of electric vehicles. €1 bn More than €1 billion to expand our battery production. Buying battery cells for more than €20 billion in €20 bn order to systematically promote our Group’s entry int
Slide 58: Strategy guided by international framework agreements
Our strategy is guided by international framework agreements,… The ten principles of the UN Global Compact provide a fundamental guide for our business operations. Our internal principles and policies are founded on this international frame of reference and other international principles. Our goal i
Slide 59: Corporate principles and integrity
… our corporate principles and integrity Doing the right thing by living our values We adhere to internal and external rules, we act according to our corporate principles and we listen to our inner compass. We have incorporated integrity-related issues in our culture and our compliance management sy
Slide 60: Daimler's green finance framework
Daimler’s green finance framework is part of our sustainable business strategy Project Management of Use of proceeds evaluation and Reporting External review proceeds selection Daimler’s green finance framework is developed to be in line with both the ICMA Green Bond Principles, as well as LMA and A
Slide 61: Second Opinion by leading provider of independent reviews of green bonds
Second Opinion by leading provider of independent reviews of green bonds SHADES OF GREEN Daimler’s green finance framework was rated by CICERO CICERO Green provides second as Dark Green. Dark Green is allocated to projects and opinions on institutions’ solutions that correspond to the long-term vi
Slide 62: Daimler FY 2020 Disclaimer
DAIMLER FY 2020 DISCLAIMER This document contains forward-looking statements that reflect our current views about future events. The words “anticipate,” “assume,” “believe,” “estimate,” “expect,” “intend,” “may,” ”can,” “could,” “plan,” “project,” “should” and similar expressions are used to identif