Kongsberg Automotive ASA · OSL:KOA
Kongsberg Automotive ASA — Q2 2019 Earnings Presentation
26 slides from Kongsberg Automotive ASA's earnings presentation, Jul 26, 2019
Slide 1: Kongsberg Automotive ASA Second quarter 2019
Kongsberg Automotive ASA Second quarter 2019 - July 26, 2019
Slide 2: Highlights Q2 2019
Highlights Q2 2019 ▪ Revenues grew by MEUR 6 (2.0%) YoY to MEUR 294 including positive FX effects of MEUR 4. This despite a declining market. ▪ Excluding FX effects, our growth rate was 1% compared to a passenger car market Sales decline of 6%. ▪ We were awarded new business worth MEUR 110 in annual
Slide 3: Revenues and Adjusted EBIT
Revenues and Adjusted EBIT Revenue and adj. EBIT figures have improved substantially over the last years Revenues Adjusted EBIT MEUR MEUR and percent 2016 2017 2018 2019 2016 2017 2018 2019 7.0% 7.2% 7.2% 307 7.0% 288 6.9% 280 288 294 288 5.4% 5.1% 4.8% 5.2% 268 267 257 259 4.9% 3.2% 3.0% 251 241 25
Slide 4: EBIT and Net Income
EBIT and Net Income Net Income continues to grow YoY driven by fundamentals and reduction of restructuring expenses EBIT Net Income MEUR MEUR 2016 2017 2018 2019 20.3 19.2 17.9 14.8 15.0 14.1 13.8 12.7 13.0 10.5 9.7 8.0 7.7 6.2 5.7 4.9 4.2 3.3 2.9 1.6 2.1 -0.2 0.2 0.3 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 -5.0 -7
Slide 5: New Business Wins
New Business Wins
Slide 6: New business wins - Group
New business wins - Group Booking momentum remains despite softening markets New business wins per quarter (per annum revenues) New business wins per quarter (lifetime revenues*) MEUR MEUR 140 600 561 122 121 537 120 110 500 459 463 99 100 400 77 349 338 339 80 71 323 66 65 288 62 300 60 36 200 40 1
Slide 7: New business wins by segment
New business wins by segment Awards in Specialty products and Interior are picking up again New business wins per quarter (per annum revenues) New business wins per quarter (lifetime revenues*) MEUR MEUR 130 600 122 121 561 SPP SPP 120 550 537 PAC PAC 110 110 INT INT 500 135 99 459 463 100 148 50 28
Slide 8: Strong book-to-bill performance over the last 2+ years ensures long-term growth
Strong book-to-bill performance over the last 2+ years ensures long-term growth MEUR Book-to-bill 2,200 1.95 Book-to-bill ratio NBW (Lifetime rev*., LTM) 1.71 1.80 2,000 1.65 1.54 1.48 1.50 1.49 1.48 1.42 1.45 1,880 1.50 1.41 1.38 1,800 1.35 1.24 1,697 1,701 1,681 1.20 1,607 1,600 1.05 1,520 1,485 1
Slide 9: Market Summary
Market Summary
Slide 10: Q2 2019 market summary
Q2 2019 market summary The decline in the passenger car market is hardly offset by the increase in the truck market ➢ Global Passenger Car Production Global Passenger Car Production, Units in millions – Global light vehicles production in Q2 2019 was 22.7m, a YoY decrease of 6.1%, or approx. 1.5m un
Slide 11: China dominated the decline in global car production
China dominated the decline in global car production FY 2019 LDV output forecast (in mill.) Annual China LDV output forecast annual output IHS Q3-18 (in mill.) annual output IHS Q2-19 (in mill.) -3.7 30.8 30.2 29.4 28.3 28.0 -3.0 27.4 27.5 26.3 26.9 98.3 25.7 91.6 24.0 23.0 22.0 21.3 CMD 2018 China
Slide 12: Segment Highlights
Segment Highlights
Slide 13: Segment financials last five quarters
Segment financials last five quarters Interior Powertrain & Specialty Revenues Chassis Products MEUR 77 77 75 119 72 112 113 116 110 103 103 66 103 98 90 Adjusted EBIT* MEUR and percent 5.9% 5.6% 5.1% 4.9% 16.6% 17.6% 17.6% 3.7% 15.6% 2.7% 3.3% 13.8% 2.5% 2.4% 19.4 1.8% 5.8 5.7 17.1 17.2 16.1 4.2 4.
Slide 14: Interior
Interior Revenues Adj. EBIT The increase was driven by a 10% 4.2 The fall through from the overall YoY growth in ICS*. This was offset revenues in ICS was satisfactory. +4.9% by a 9% market driven decline in the However, the revenue decline and the LDC* business. -1.7 additional Mexican labor cost i
Slide 15: Powertrain and Chassis (P&C)
Powertrain and Chassis (P&C) Revenues Adj. EBIT In Q2, P&C grew in both, the 5.7 Most of the YoY increase was passenger car and the truck & bus attributed to the fall through from +3.0% markets. the additional revenues in North The passenger car growth was driven 2.8 America and Asia. 116 by an incr
Slide 16: Specialty Products Segment
Specialty Products Segment Revenues Adj. EBIT The YoY revenues in the segment A slightly unfavorable product mix and were flat with small variations in the increased Mexican labor rates between the different business units. negatively impacted profitability. 0.0% A challenging market for the outdoor
Slide 17: Financial Update
Norbert Loers Financial Update
Slide 18: Q2 2019 - Revenue development
Q2 2019 - Revenue development Interior and Powertrain & Chassis segments driving revenue growth ► Group MEUR – Revenues of MEUR 294.3, which is a YoY growth of +2.4%. 296 ► Business segments 3.6 – Interior’s positive YoY development was driven by volume growth in ICS business, but offset by a declin
Slide 19: Q2 2019 - Adjusted EBIT development
Q2 2019 - Adjusted EBIT development 23 MEUR ► Group – Adjusted EBIT MEUR 20.4, MEUR 0.4 lower than Q2 2018. 22 2.6 -1.2 ► Business Segments – Fall through from increased volumes offset 21 -1.6 by: -0.2 • Increased custom duties • Unfavorable product mix • Increased Mexican labor cost 20 ► FX and Oth
Slide 20: Q2 2019 - Net Profit development
Q2 2019 - Net Profit development ► Group MEUR 12 – Net Profit was MEUR 0.6 above Q2 2018 mainly driven by lower 4.4 -5.4 restructuring costs, but strongly 10 impacted by prior year tax adjustments. 4.7 -2.6 ► Restructuring costs – Prior year restructuring cost (MEUR 5.9) 8 related to the transfer of
Slide 21: Free Cash Flow
Free Cash Flow* MEUR ► Operational cash flow MEUR 13.9 – Overall NWC increase in line with 30 seasonality effects. – Inventory decreased by MEUR 7.9. 23 – Cash out related to restructuring 20 activities amounted to MEUR -1.3 14 for Q2 2019. – IFRS 16 effects on reduced leasing 10 8 cost as offset in
Slide 22: Q2 2019 - Liquidity development
Q2 2019 - Liquidity development MEUR Cash (unrestricted) Unutilized RCF 31.0 -4.3 -16.4 -3.7 -1.3 -4.9 82.4 -1.0 -6.5 75.2 75.2 32.4 25.2 35.2 -10.0 50.0 50.0 40.0 Q1 2019 Adjusted Change in Net Interest paid Cash Tax Currency Other Q2 2019 Net RCF Q2 2019 EBITDA Total NWC Investments and other rest
Slide 23: Net financial items - Breakdown
Net financial items - Breakdown MEUR ► Currency effects Net financial Items – The currency loss of MEUR Other items 0.5 consisted of MEUR 0.3 Currency effects realized FX gains and MEUR 0.8 unrealized FX loss. Net interest 1.2 1.0 ► Interest -1.2 -2.6 -2.8 – Main elements were the -5.4 -5.8 -5.8 IFR
Slide 24: Financial ratios
Financial ratios Adjusted gearing ratio (NIBD/EBITDA, LTM*) Adjusted ROCE* (%, LTM) Incl. IFRS 16 effect Incl. IFRS 16 effect 3.0 3.0 2.2 2.2 2.3 13.9 15.3 14.9 13.8 14.0 13.2 2.1 1.9 13.1 Q2 2018 Q3 2018 Q4 2018 Q1 2019 Q2 2019 Q2 2018 Q3 2018 Q4 2018 Q1 2019 Q2 2019 Equity Ratio** (%) Capital Empl
Slide 25: Summary
Summary
Slide 26: Summary & Conclusion
Summary & Conclusion ➢ Continuing strong topline performance in a declining market. ➢ Supported by strong new business wins. ➢ On an adjusted EBIT level, we perform at the levels outlined during the Q1 Earnings Announcement which are slightly below prior year due mainly to macro effects. ➢ At the EB