Nokian Renkaat Oyj · OMXHEX:TYRES
Nokian Renkaat Oyj — Nokian Tyres — Q2 2023 Earnings Presentation
21 slides from Nokian Renkaat Oyj's earnings presentation, Jul 21, 2023
Slide 1: Building the New Nokian Tyres on Track
BUILDING THE NEW NOKIAN TYRES ON TRACK HALF YEAR FINANCIAL REPORT JANUARY–JUNE 2023 JULY 21, 2023 JUKKA MOISIO – CEO TEEMU KANGAS-KÄRKI – CFO
Slide 2: Strategic Projects Proceeding as Planned
STRATEGIC PROJECTS PROCEEDING AS PLANNED • In Romania, building work underway at the factory site • Building permit received, groundbreaking in May 2023 • Main equipment ordered already in 2022 • First tires in H2/2024, commercial production in 2025 • Application for an investment subsidy of up to E
Slide 3: Profitability Improved in Q2
PROFITABILITY IMPROVED IN Q2 • Segments net sales EUR 293.1 million (332.3), -7.3% with comparable currencies • Lower passenger car tire supply volumes • Demanding car and tire market environment, incl. currency headwinds • Segments operating profit EUR 15.2 million (0.9) • Price increases to combat
Slide 4: Building the New Nokian Tyres on Track
BUILDING THE NEW NOKIAN TYRES ON TRACK CC* CC* EUR million 4–6/23 4–6/22 Change Change 1–6/23 1–6/22 Change Change 2022 Segments net sales 293.1 332.3 -11.8% -7.3% 529.5 655.2 -19.2% -16.1% 1,350.5 Segments EBITDA 41.3 25.9 52.5 84.9 118.7 Segments EBITDA, % 14.1% 7.8% 9.9% 13.0% 8.8% Segments opera
Slide 5: Building Diversified Debt Portfolio
BUILDING DIVERSIFIED DEBT PORTFOLIO • Committed credit limits and EUR 500 million commercial paper program DEBT COMPOSITION in place AS OF Q2 2023 • EUR 300 million long-term bilateral credit facilities withdrawn in May to refinance EUR 150 million bilateral facilities and to finance investments • E
Slide 6: Q2: Passenger Car Tyres
Q2: PASSENGER CAR TYRES Lower supply volumes affected net sales negatively 4–6/ 4–6/ CC* 1–6/ 1–6/ CC* 23 22 Change Change 23 22 Change Change 2022 Net sales, M€ 152.6 185.2 -17.6% -13.6% 285.9 408.7 -30.0% -27.5% 810.7 Segment operating profit, M€ 0.5 -22.7 -4.0 20.3 -24.7 Segment operating profit,
Slide 7: Q2: Passenger Car Tyres Bridge
Q2: PASSENGER CAR TYRES BRIDGE Price/mix impacted segment operating profit positively by EUR 29 million NET SALES, M€ 250 -18% 200 185 -54 29 160 -8 153 150 -29,1% +15,6% -4,0% 0 4-6/2022 Sales Volume Price/Mix Net Sales excl Currency 4-6/2023 FX effect SEGMENT OPERATING PROFIT, M€ 7
Slide 8: Q2: Heavy Tyres
Q2: HEAVY TYRES Net sales impacted by soft aftermarket 4–6/ 4–6/ CC* 1–6/ 1–6/ CC* 23 22 Change Change 23 22 Change Change 2022 Net sales, M€ 67.5 73.7 -8.4% -6.4% 135.7 138.0 -1.7% -0.4% 271.0 Segment operating profit, M€ 8.7 16.8 18.3 28.9 44.1 Segment operating profit, % 13.0% 22.8% 13.5% 20.9% 1
Slide 9: Q2: Vianor
Q2: VIANOR Stable sales performance 4–6/ 4–6/ CC* 1–6/ 1–6/ CC* 23 22 Change Change 23 22 Change Change 2022 Net sales, M€ 94.4 99.1 -4.7% 3.4% 149.9 156.2 -4.0% 3.1% 362.0 Segment operating profit, M€ 9.5 9.6 -4.0 -2.5 3.1 Segment operating profit, % 10.1% 9.7% -2.7% -1.6% 0.9% Number of own servic
Slide 10: Taking Steps Forward in Sustainability
TAKING STEPS FORWARD IN SUSTAINABILITY • In March, we made a science-based commitment to achieve Net-Zero Standard by 2050 to further reduce greenhouse gas emissions • In May, we were awarded a Platinum Medal from EcoVadis for our sustainability performance, placing us in the top1 percentile of comp
Slide 11: Assumptions for 2023
ASSUMPTIONS FOR 2023 • The second half of the year is expected to be supported by the winter tire and all-season tire season and contract manufacturing volume. • The general economic development may have a negative impact on demand in the second half of 2023. • Changes in foreign currencies, especia
Slide 12: Guidance for 2023 (Unchanged)
GUIDANCE FOR 2023 (UNCHANGED) In 2023, Nokian Tyres’ segments net sales are expected to be between EUR 1,300–1,500 million and segments operating profit percentage of net sales between 6–8%. It is expected that due to seasonality, the segments operating profit will be generated in the second half of
Slide 13: Building the New Nokian Tyres Together
BUILDING THE NEW NOKIAN TYRES TOGETHER PURPOSE EMPOWER THE WORLD TO DRIVE SMARTER BUSINESS AREA AND UNIT ROLES FINANCIAL TARGETS BACK TO • NORDICS: Strengthen #1 position • Net sales EUR 2 billion OUR • NORTH AMERICA: Grow sales by ~100% • Segments operating profit LONG-TERM EUR 2 BILLION • CENTRAL
Slide 14: Appendix
/ nokia’ TYRES APPENDIX 6
Slide 15: Group Segments Operating Profit per Quarter 2019–H1/2023
APPENDIX GROUP SEGMENTS OPERATING PROFIT PER QUARTER 2019–H1/2023 Cumulative Segment Operating Profit per Review Period 400 1–6/2023 350 300 • Segments net sales 529.5 M€ 250 200 (655.2), -19.2% 150 100 • Segments operating profit 50 1.1 M€ (35.5) 0 1-3 1-6 1-9 1-12 -50 4–6/2023 Segment Operating Pr
Slide 16: H1: Passenger Car Tyres Bridge
APPENDIX H1: PASSENGER CAR TYRES BRIDGE Price/mix impacted segment operating profit positively by EUR 85 million NET SALES, M€ -30% 450 409 -197 400 350 85 296 -11 286 300 250 200 -48,2% +20,7% -2,6% 0 1-6/2022 Sales Volume Price/Mix Net Sales excl Currency 1-6/2023 FX effect SEGMENT OPERATING PROFI
Slide 17: Passenger Car Tyres Net Sales - Quarterly Changes
APPENDIX PASSENGER CAR TYRES NET SALES - QUARTERLY CHANGES YoY Change % Sales Volumes Price / Mix Currency 24,1% 15,6% -29,1% -1,5% -4,0% -62,9% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2023 2023 2023 17
Slide 18: Material Cost Development
APPENDIX MATERIAL COST DEVELOPMENT MATERIAL COST DEVELOPMENT INDEX 2010–E2023 150 138 140 140 MATERIAL COSTS (€/KG) 130 131 131 • Increased by 4.8% in Q2/2023 vs. 120 114 Q2/2022 110 100 98 100 96 96 92 92 • Decreased by 4.4% in Q2/2023 vs. 90 83 84 Q1/2023 80 79 70 • Increased by 11.0% in H1/2023 v
Slide 19: Net Debt and Debt Maturities
APPENDIX NET DEBT AND DEBT MATURITIES Net Debt Debt Maturities Q2/2023 Q2/2022 Q2/2023 700 700 400 400 350 350 600 600 129 24 300 300 500 500 101 250 250 EUR million EUR million 200 400 147 400 200 200 300 27 300 150 301 150 29 30 200 409 200 100 100 289 100 100 100 50 104 99 50 19 17 10 0 2 1 1 1 2
Slide 20: Nokian Tyres Network
APPENDIX NOKIAN TYRES NETWORK Vianor and NAD; -402 stores H1/2023 VIANOR – 678 SERVICE CENTERS IN 11 COUNTRIES • Nordic countries: 338 service centers (-1 vs. year-end 2022) • Central Europe: 340 service centers (unchanged vs. year-end 2022) NOKIAN TYRES AUTHORIZED DEALERS (NAD) NAD – 1,752 STORES I
Slide 21: Disclaimer
Disclaimer Statements in this presentation, which are not historical facts, such as expectations, anticipations, beliefs and estimates, are forward-looking statements within the meaning of the United States Private Securities Litigation Reform Act of 1995. Such statements involve risks and uncertain