Schaeffler Ag · XETR:SHA0

Schaeffler — Schaeffler Ag Ord — Q1 2024 Earnings Presentation

39 slides from Schaeffler's earnings presentation, May 7, 2024

Slide 2: Disclaimer
Disclaimer This presentation contains forward-looking statements. The words “anticipate”, “assume”, “believe”, “estimate”, “expect”, “intend”, “may”, “plan”, “project”, “should” and similar expressions are used to identify forward-looking statements. Forward-looking statements are statements that ar
Slide 3: Agenda
1 Overview 2 Business Highlights Q1 2024 3 Financial Results Q1 2024 4 Outlook
Slide 4: Schaeffler Group – Strong Q1 results in a continued difficult market environment
1 OVERVIEW Schaeffler Group – Strong Q1 results in a continued difficult market environment Key messages Q1 2024 Sales growth1 Q1 Gross Margin2 Q1 1 Q1 Sales flat1 on high comps – Automotive Technologies with positive outperformance, Vehicle Lifetime Solutions up strongly, weaker sales in Bearings &
Slide 5: Schaeffler Group Q1 2024 – Highlights and lowlights
1 OVERVIEW Schaeffler Group Q1 2024 – Highlights and lowlights Automotive Technologies Bearings & Industrial Solutions Strong Order Intake driven by new business, Topline impacted by continued challenging market strong EBIT margin2 by mature business environment, in particular Wind in China Vehicle
Slide 6: Business Highlights Q1 2024
1 Overview 2 Business Highlights Q1 2024 3 Financial Results Q1 2024 4 Outlook
Slide 7: Group – Extraordinary impact in Gross Profit by new inventory valuation
2 BUSINESS HIGHLIGHTS Q1 2024 Group – Extraordinary impact in Gross Profit by new inventory valuation, not impacting our adj. EBIT margin Key Aspects Sales EBIT3 in EUR mn in EUR mn Growth1 driven by automotive divisions despite high comps; -13 mn Americas growing1 across all flat1 Divisions 335 93
Slide 8: Sales Performance Q1 2024 – Flat sales, heterogeneous development vs. strong comps
2 BUSINESS HIGHLIGHTS Q1 2024 Sales Performance Q1 2024 – Flat sales, heterogeneous development vs. strong comps Automotive Vehicle Lifetime Bearings & Technologies2 Solutions2 Industrial Solutions2 Q1 2024 1 % of Group Region Growth Sales 43% 15% 41% Europe 45% +1.9% +3.7% -5.4% -0.4% Americas 23%
Slide 9: Automotive Technologies – Slight sales growth, EBIT margin improving
2 BUSINESS HIGHLIGHTS Q1 2024 Automotive Technologies1 – Slight sales growth, EBIT margin4 improving Key Aspects Sales EBIT4 in EUR mn in EUR mn E-Mobility continues growth path in Europe and Americas, +6 mn double-digit growth2 in Chassis +0.8%2 Systems 93 93 1,778 1,770 87 Strong Q1 EBIT margin of
Slide 10: Automotive Technologies – Strong Q1 Order Intake of EUR 1.5 bn in E-Mobility
2 BUSINESS HIGHLIGHTS Q1 2024 Automotive Technologies – Strong Q1 Order Intake of EUR 1.5 bn in E-Mobility Order Intake1,2 Key aspects in EUR bn Thereof 3.2 5.0 5.1 1.5 E-Mobility New OEM nominations for E-Motor and Inverter in our 10.5 strongly growing global 9.5 E-Mobility Heavy Duty Business 8.2
Slide 11: Vehicle Lifetime Solutions – Strong sales growth and very strong EBIT margin
2 BUSINESS HIGHLIGHTS Q1 2024 Vehicle Lifetime Solutions1 – Q1 with strong sales growth2 and very strong EBIT margin4 Key Aspects Sales EBIT4 in EUR mn in EUR mn High-single-digit sales growth2 on strong comps driven by +19 mn strong demand in ongoing +8.6%2 favorable market environment 109 All regi
Slide 12: Vehicle Lifetime Solutions – Customer Portal setting new standards
2 BUSINESS HIGHLIGHTS Q1 2024 Vehicle Lifetime Solutions – Customer Portal is setting new standards for customer interactions Key Aspects • Schaeffler Customer Portal is the new digital touchpoint for our distribution and retail customers • Personalized user experience for pre-sales services, Order
Slide 13: Bearings & Industrial Solutions – Challenging market remains
2 BUSINESS HIGHLIGHTS Q1 2024 Bearings & Industrial Solutions1 – Challenging market remains, Sales2 and EBIT4 driven by lower volume Key Aspects Sales EBIT4 in EUR mn in EUR mn Lower Q1 sales2 on high comps -16 mn impacted by continued weak -4.1%2 market environment 159 Ongoing challenging Wind 1,78
Slide 14: Bearings & Industrial Solutions – Orderbook Industrial gaining momentum
2 BUSINESS HIGHLIGHTS Q1 2024 Bearings & Industrial Solutions – Orderbook Industrial still below prior-year level, but gaining momentum Orderbook Industrial 3-month1, 2 Orderbook 3M1 Sales2 Key aspects yoy growth % 40 New multi-year contract with key Aerospace gearbox manufacturer 30 in Europe runni
Slide 15: Capital allocation – Continued prioritization of Capex for growth business
2 BUSINESS HIGHLIGHTS Q1 2024 Capital allocation – Continued prioritization of Capex for growth business Investment1 allocation Key Aspects in EUR mn • Reinvestment Rate Target: Continued prioritization of E-Mobility FY 2022 2 FY 2023 Q1 2023 Q1 2024 and Bearings & Industrial Solutions businesses; c
Slide 16: Transaction update – Excellent deal execution and diligent preparation for Day One
2 BUSINESS HIGHLIGHTS Q1 2024 Transaction update – Excellent deal execution and diligent preparation for Day One Timeline – Key steps Key aspects January 5, 2024 Closing of Tender Offer Disciplined Execution pays off – Approval of mergers in AGMs February 2, 2024 EGM – Conversion of Schaeffler Non-
Slide 17: Financial Results Q1 2024
1 Overview 2 Business Highlights Q1 2024 3 Financial Results Q1 2024 4 Outlook
Slide 18: Sales – Region Americas growing, strong performance by Vehicle Lifetime Solutions
3 FINANCIAL RESULTS Q1 2024 Sales – Region Americas growing, strong performance by Vehicle Lifetime Solutions Sales Key Aspects in EUR mn -1.6%1 0.0%2 • Automotive Technologies: +0.8% growth2 in Q1, driven by Europe, Americas and Asia/Pacific 4,152 4,056 4,062 4,043 4,085 • Vehicle Lifetime Solution
Slide 19: Gross Profit – Impacted by change of accounting estimates in inventory valuation
3 FINANCIAL RESULTS Q1 2024 Gross Profit – Impacted by change of accounting estimates in inventory valuation Gross Profit Q1 2023 vs. Q1 2024 Key Aspects in EUR mn • Pricing: Maintained pricing levels driven by Vehicle Lifetime Solutions and Bearings & Industrial Solutions +117 1,086 • Volumes: Mark
Slide 20: Overhead costs – Increased ratio due to business & M&A activities
3 FINANCIAL RESULTS Q1 2024 Overhead costs – Increased ratio due to business & M&A activities Overhead costs Key Aspects in EUR mn +8.0% • R&D: R&D expenses at prior-year level • Selling expenses: Increase due to volume-driven logistic costs in 692 Vehicle Lifetime Solutions 641 615 622 626 208 • Ad
Slide 21: EBIT margin – Strong, almost at prior year level
3 FINANCIAL RESULTS Q1 2024 EBIT margin1 – Strong EBIT margin1, almost at prior year level despite challenging environment EBIT1 Key Aspects in EUR mn -0.2pp • Automotive Technologies: EBIT margin1 up yoy driven by volume and favorable product mix 335 340 322 • Vehicle Lifetime Solutions: Strong EBI
Slide 22: Automotive Technologies – New Business growing, EBIT margin up
3 FINANCIAL RESULTS Q1 2024 Automotive Technologies1 – New Business growing, EBIT margin3 up yoy driven by volume and mix Sales by business division yoy growth EBIT3 Q1 2023 vs. Q1 2024 in EUR mn Q1 2023 Q1 2024 ∆2 +46 E-Mobility 335 337 +2.2% -1 Engine & Transmission 1,335 1,317 -0.3% -14 87 93 Cha
Slide 23: Vehicle Lifetime Solutions – Strong EBIT margin driven by volume and pricing
3 FINANCIAL RESULTS Q1 2024 Vehicle Lifetime Solutions1 – Strong EBIT margin6 driven by both volume and pricing carry-over Sales by region yoy growth EBIT6 Q1 2023 vs. Q1 2024 in EUR mn Q1 2023 Q1 2024 ∆2 Europe 393 415 +3.7% +37 Americas 120 132 +17.7% Greater China 34 41 +29.4% -1 +9 109 Asia/Paci
Slide 24: Bearings & Industrial Solutions – Region Americas growing
3 FINANCIAL RESULTS Q1 2024 Bearings & Industrial Solutions1 – Region Americas growing, EBIT margin3 almost at prior year level despite significantly lower volume Sales by region yoy growth EBIT3 Q1 2023 vs. Q1 2024 in EUR mn Q1 2023 Q1 2024 ∆2 Europe 775 732 -5.4% Americas 347 357 +4.1% +87 Greater
Slide 25: Net Income – EPS reached EUR 0.35, ROCE at 12.0%
3 FINANCIAL RESULTS Q1 2024 Net Income1 – EPS² reached EUR 0.35, ROCE³ at 12.0% Net income1 Key Aspects in EUR mn +103 mn • Q1 Net income1 significantly higher yoy driven by the one-off measurement gain from the initial application of the new method for 231 inventory valuation 138 150 • ROCE³ and Sc
Slide 26: Free Cash Flow – Seasonal increase in working capital
3 FINANCIAL RESULTS Q1 2024 Free Cash Flow – Seasonal increase in working capital and one-off financing transaction payments Free Cash Flow before M&A1 in EUR mn Reconciliation Q1 2024 in EUR mn -93 mn 659 182 210 103 -374 -222 -84 -90 -55 -166 -73 EBITDA ∆ Net Capex Net Interest Taxes Others FCF Q1
Slide 27: Leverage ratio at 2.1x LTM EBITDA bsi
3 FINANCIAL RESULTS Q1 2024 Leverage ratio at 2.1x LTM EBITDA bsi – Technically impacted until consolidation of Vitesco Net financial debt and Leverage ratio1 Key Aspects in EUR mn 4,613 • Gross debt sequentially higher in Q1 2024 notably due to bond issuance for the financing of the acquisition of
Slide 28: Outlook
1 Overview 2 Business Highlights Q1 2024 3 Financial Results Q1 2024 4 Outlook
Slide 29: FY 2024 Guidance – Confirmed for all metrics
4 OUTLOOK FY 2024 Guidance – Confirmed for all metrics FY 2024 Guidance1 KEY ASPECTS • In transition year 2024 we will only guide Schaeffler Group on Group level • FY 2024 Group Guidance is based on: FY 2023 Q1 2024 FY 2024 − Vitesco accounted for „at equity“ from Actuals Actuals Guidance1 acquisiti
Slide 30: Conclusion & Outlook – On track to build the leading Motion Technology Company
4 OUTLOOK Conclusion & Outlook – Strong Q1 results, Guidance confirmed for transition year 2024 1 Financial performance – Strong Q1 earnings quality despite high comps thanks to our diversified and resilient portfolio across regions and businesses 2 Strong Balance Sheet – Full focus on Free Cash Flo
Slide 31: Financial calendar and selected IR events
4 OUTLOOK Financial calendar and selected IR events Roadshows & Conferences Financial calendar 2024 with Top Management participation May 15 Citi Virtual Autos Trip – Citi Aug 6 H1 2024 Earnings Release May 22 European Champions Conference – Nov 5 9M 2024 Earnings Release Frankfurt, Deutsche Bank Ju
Slide 34: Transition year 2024 – Schaeffler transitory operating model and reporting
BACKUP Transition year 2024 – Schaeffler transitory operating model and reporting Adjusted comparative figures 2023 Key Aspects • Automotive Aftermarket and Automotive Technologies in EUR mn Bearings & Industrial Solutions in EUR mn Industrial divisions are renamed Q1 23 Q2 23 Q3 23 Q4 23 FY 23 Q1 2
Slide 35: Market assumptions
BACKUP Market assumptions Global LVP1 2024 Global LV Parc3 Industrial Production4 90.4 90.3 ~90 5.4% World 4.4% 3.1% 1.5% World 2.6% 21.4 22.2 22.6 24.2 21.2 1.0% 1.2% -0.9% Q1 Q2 Q3 Q4 2023 Q1 2024e 2024e Europe Americas Greater China Asia/Pacific Europe Americas Greater China Asia/Pacific S&P SHA2
Slide 36: Key figures Q1 2024
BACKUP Key figures Q1 2024 Q1 2024 in EUR mn Q1 2023 Q1 2024 vs. Q1 2023 -1.6% Sales 4,152 4,085 0.0%1 Gross Profit 959 1,086 +127 mn Gross margin 23.1% 26.6% +3.5pp EBIT2 335 322 -13 mn EBIT margin2 8.1% 7.9% -0.2pp Net income3 128 231 +103 mn EPS4 (in EUR) 0.19 0.35 +0.16 Schaeffler Value Added5 2
Slide 37: Net Income – EBIT reconciliation and special items
BACKUP Net Income1 – EBIT reconciliation and special items Reconciliation Q1 2024 in EUR mn Key aspects • Special items amounted to EUR 93 mn in Q1, mainly related to a one-off EUR 117 m measurement gain from the initial application +93 415 of the new method for the actual cost valuation of inventor
Slide 38: Working Capital ratio 21.0% – Capex ratio 5.4% in Q1
BACKUP Working Capital ratio 21.0% – Capex ratio 5.4% in Q1 Working capital1 Capex2 in EUR mn in EUR mn +190 mn +1 mn 3,309 3,413 3,223 3,165 3,030 273 247 221 222 198 Q1 Q2 Q3 Q4 Q1 Q1 Q2 Q3 Q4 Q1 2023 2023 2023 2023 2024 2023 2023 2023 2023 2024 in % of Sales (LTM) in % of Sales 20.0% 19.3% 20.4%
Slide 39: Overview Corporate and Financing Structure
BACKUP Overview Corporate and Financing Structure Financing structure as of March 31, 2024 A IHO Verwaltungs GmbH Corporate structure (simplified) as of March 31, 2024 Debt instrument Nominal Nominal Interest Maturity Rating USD mn EUR1 mn Fitch/Moody’s/S&P Loans RCF (EUR 800 mn) - 120 E+3.25% Jun-2

Schaeffler Ag Ord — Q1 2024 Earnings Presentation on 6ix

Schaeffler — Schaeffler Ag Ord — Q1 2024 Earnings Presentation

Slide 1: Q1 2024 Schaeffler AG earnings

Slide 2: Disclaimer

Slide 3: Agenda

Slide 4: Schaeffler Group – Strong Q1 results in a continued difficult market environment

Slide 5: Schaeffler Group Q1 2024 – Highlights and lowlights

Slide 6: Business Highlights Q1 2024

Slide 7: Group – Extraordinary impact in Gross Profit by new inventory valuation

Slide 8: Sales Performance Q1 2024 – Flat sales, heterogeneous development vs. strong comps

Slide 9: Automotive Technologies – Slight sales growth, EBIT margin improving

Slide 10: Automotive Technologies – Strong Q1 Order Intake of EUR 1.5 bn in E-Mobility

Slide 11: Vehicle Lifetime Solutions – Strong sales growth and very strong EBIT margin

Slide 12: Vehicle Lifetime Solutions – Customer Portal setting new standards

Slide 13: Bearings & Industrial Solutions – Challenging market remains

Slide 14: Bearings & Industrial Solutions – Orderbook Industrial gaining momentum

Slide 15: Capital allocation – Continued prioritization of Capex for growth business

Slide 16: Transaction update – Excellent deal execution and diligent preparation for Day One

Slide 17: Financial Results Q1 2024

Slide 18: Sales – Region Americas growing, strong performance by Vehicle Lifetime Solutions

Slide 19: Gross Profit – Impacted by change of accounting estimates in inventory valuation

Slide 20: Overhead costs – Increased ratio due to business & M&A activities

Slide 21: EBIT margin – Strong, almost at prior year level

Slide 22: Automotive Technologies – New Business growing, EBIT margin up

Slide 23: Vehicle Lifetime Solutions – Strong EBIT margin driven by volume and pricing

Slide 24: Bearings & Industrial Solutions – Region Americas growing

Slide 25: Net Income – EPS reached EUR 0.35, ROCE at 12.0%

Slide 26: Free Cash Flow – Seasonal increase in working capital

Slide 27: Leverage ratio at 2.1x LTM EBITDA bsi

Slide 28: Outlook

Slide 29: FY 2024 Guidance – Confirmed for all metrics

Slide 30: Conclusion & Outlook – On track to build the leading Motion Technology Company

Slide 31: Financial calendar and selected IR events

Slide 32: Thank you

Slide 33: May 7, 2024 Q1 2024 Schaeffler AG earnings Copyright Schaeffler AG, 2024 – All

Slide 34: Transition year 2024 – Schaeffler transitory operating model and reporting

Slide 35: Market assumptions

Slide 36: Key figures Q1 2024

Slide 37: Net Income – EBIT reconciliation and special items

Slide 38: Working Capital ratio 21.0% – Capex ratio 5.4% in Q1

Slide 39: Overview Corporate and Financing Structure