Slide 1: 2nd Quarter 2018 Financial Results
1st Earnings Conference Call and Webcast 2nd Quarter 2018 Financial Results July 27, 2018 1 July 27, 2018 ALV – Q2-2018 Earnings Call and Webcast Copyright Autoliv Inc., All Rights Reserved Copyright Autoliv Inc., All Rights Reserved
Slide 2: Safe Harbor Statement
Safe Harbor Statement* This presentation contains statements that are not historical facts but rather forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements include those that address activities, events or developments t
Slide 3: Q2´18 Highlights
Q2´18 Highlights ▪ Successful completion of the spin-off of Veoneer on June 29, 2018 − ~$1 billion capital injection into Veoneer while keeping long-term credit rating unchanged A- (with stable outlook) ▪ The management team is giving its full focus on 2020 target delivery. The full year growth and
Slide 4: Q2´18 Financial Highlights
Q2´18 Financial Highlights Step-up in sales growth from past three years order intake Consolidated Sales Operating Income adjusted* EPS adjusted* $ million $ million $ >11% >6% ~48% 2,212 230 2.22 216 1.50 1,984 Q2´17 Q2´18 Q2´17 Q2´18 Q2´17 Q2´18 (*) Non-US GAAP measures exclude costs for capacity
Slide 5: Q2´18 Sales Growth
Q2´18 Sales Growth Sales Bridge Regional Organic Growth** $ million +11.5% Org. growth +7.3% EUROPE 0.3% JAPAN LVP* 4% 3.5% LVP* 1% AMERICAS CHINA 12.8% LVP* 0% 18.0% LVP* 9% REST OF ASIA 1.4% LVP* 5% (*) Light Vehicle Production (LVP) according to IHS @ July 16, 2018, (**) Non-US GAAP measure. 5 Ju
Slide 6: 2018 - Key Models
2018 - Key Models Contributing to the ramp-up of organic sales* growth Honda Accord Tesla Model 3 Infinity QX50 Nissan Altima Volkswagen Jetta Honda Odyssey VW Polo Jeep Compass Ram Truck Honda CR-V Nissan Qashqai / Rogue Hyundai Genesis G70 Jeep Wrangler These models are anticipated to contribute ~
Slide 7: Number of Launches
Product Launches per Quarter Q2’18 increased >70% YoY +25% 250 ~740 200 ~600 ~600 Number of Launches 150 100 50 0 2016 2017 2018 2019 7 July 27, 2018 ALV – Q2-2018 Earnings Call and Webcast Copyright Autoliv Inc., All Rights Reserved
Slide 8: Overall Market Conditions
Overall Market Conditions Light Vehicle Sales LTM** Major light vehicle markets remain uncertain ▪ Asia − In Q2´18, China’s LV sales rose by 8% to nearly 6.5 million behind strong deliveries in April and May − China inventory** levels are in line with last year, but have increased sequentially from
Slide 9: Trade and Regulatory Update
Trade and Regulatory Update ▪ Autoliv continues to monitor the trade and regulatory environment ▪ Monitoring the potential U.S. auto tariff and potential NAFTA re-negotiations ▪ China/S.Korean/U.S. trade tariffs − Autoliv has imports/exports with both China and South Korea − Our U.S. suppliers are n
Slide 10: Q2´18 Financial Overview
Q2´18 Financial Overview (US $ Millions unless specified) 2018 2017 Sales $2,212 $1,984 Gross Profit $440 19.9% $415 20.9% Operating Income* $230 10.4% $216 10.9% EPS* (assuming dilution) $2.22 $1.50 RoCE* 21% n/a RoE* 25% n/a Operating cash flow** $47 $179 Dividend per share $0.62 $0.60 GLVP** (ann
Slide 11: Operating Margin Bridge Q2'18 vs. Prior Year
Operating Margin* Bridge Q2’18 vs. Prior Year (0.5%) Adj. EBIT +6.4% Adjusted Operating Margin of 10.4% includes ~70 bps increase in Raw material and Currency impact (*) Non-US GAAP measures exclude costs for capacity alignments and antitrust related matters. 11 July 27, 2018 ALV – Q2-2018 Earnings
Slide 12: Cash Flow – including discontinued operations
Cash Flow – including discontinued operations Investments for growth and shareholder returns (US $ Millions unless specified) Q2’18 Q2’17 LTM* 2017 2016 2015 Net Income 34 128 189 303 562 458 Depreciation & Amortization*** 114 100 435 660 383 319 Other, net 33 10 29 (27) 1 0 Change in operating WC**
Slide 13: Underlying EPS improvement
Underlying EPS* improvement Driven by lower tax and higher operating income Continuing Operations Continuing Operations excluding items affecting comparability* $ $ +43% +48% $2.20 $2.22 The main items impacting EPS* were ▪ ~58 cents from tax rate $1.54 $1.50 ▪ ~12 cents from operating income Q2´17
Slide 14: Capital Structure
Capital Structure Higher ROCE* and ROE* in the new corporate structure ROCE* ROE* Shareholder returns $M 800 Share Repurchase 21% 25% Dividend 20% 20% Free Cash flow 600 13% 15% 14% 400 7% 200 0 2015 2016 2017 Q2´18 2015 2016 2017 Q2'18 '09 '11 '13 '15 '17 LTM Additionally we distributed approximate
Slide 15: Strong Balance Sheet and Prudent Financial Policy
Strong Balance Sheet and Prudent Financial Policy Committed to Maintain “Strong Investment Grade” Rating Supported by High FCF Conversion Net Debt/ EBITDA(1) x ✓ Provided $1B of cash liquidity for Veoneer at time of spin-off 2.0 ‒ Mix of new debt and existing cash 1.6 ✓ S&P confirmed long-term credi
Slide 16: Long Term Debt
Long Term Debt Maturity Structure of Long Term Debt Considerations 600 500 Well-balanced debt maturity profile 400 US $ (M) ‒ 500M€ Eurobond maturing 2023 ‒ $1.3B USPP notes with various maturities 300 Unutilized RCF of $1.1B maturing in 2023 200 100 0 2018 2019 2020 2021 2022 2023 2024 2025 202
Slide 17: Financial Outlook
Financial Outlook Consolidated sales, net and operating margin* FY’18 Sales Organic* ~8% Fx** ~2% Consolidated Sales, net ~10% Operating Margin* >11% Exchange rates** FY’18 EUR / US$ 1,1915 US$ / JPY 110,31 US$ / KRW 1100 US$ / MXN 19,03 US$ / CNY 6,52 (*) Non-US GAAP measures exclude costs for capa
Slide 18: Each year, Autoliv's products save over 30,000 lives
Each year, Autoliv’s products save over 30,000 lives autoliv.com