Rheinmetall Ag · XETR:RHM
Rheinmetall — Investor Presentation (January 2006)
30 slides from Rheinmetall's investor presentation, January 2006
Slide 1: Rheinmetall Group Corporate Presentation January 2006
Rheinmetall Group Corporate Presentation January 2006 1
Slide 2: Target structure achieved
Rheinmetall Group Target structure achieved Rheinmetall AG Kolbenschmidt Pierburg Rheinmetall Defence Leading automotive supplier in Leading European defence company engine components for ground forces technology Sales: € 1.9 billion Sales: € 1.4 billion Employees: 11,400 Employees: 6,800 2
Slide 3: Restructuring
Rheinmetall Group Restructuring Objective From growth orientation (until 1999) to focused and profitable businesses under full ownership of Rheinmetall Number of business units reduced from six to two Structural Measures Divestment of € 2.5 billion business volume Minorities: € 500 million spent on
Slide 4: New group-performance targets for Rheinmetall
Rheinmetall Group New group-performance targets for Rheinmetall 20% Old target: 15% EBIT-margin and ROCE remain 15.4 13.4 target ratios of the performance 10.9 development 8.6 ROCE* % 4.3 New margin targets should be 9% achieved in three to five years Old target: 7% 6.6 Precondition is a normal 5.2
Slide 5: Stock class consolidation
Rheinmetall Group Stock class consolidation Conversion of preferred into common shares on 1:1 basis More transparent equity structure and thus stronger appeal of Rheinmetall stock especially to foreign investors All Rheinmetall shares listed as ordinary shares since June 27, 2005 Free float 100 perc
Slide 6: Corporate sector Automotive
Corporate sector Automotive 6
Slide 7: Kolbenschmidt Pierburg-Group focuses on products around the engine
Rheinmetall Automotive Kolbenschmidt Pierburg-Group focuses on products around the engine Kolbenschmidt Pierburg AG Sales 2004: € 1.9 billion, Employees: 11,400 Pierburg Pistons Plain Bearings Aluminium Technology Motor Service Air supply Passenger car Plain bearings Aluminium Aftermarket pistons en
Slide 8: Well-balanced customer structure with leading positions in key markets
Rheinmetall Automotive Well-balanced customer structure with leading positions in key markets Business Unit Market Position Pierburg Air supply products (Intake manifolds, etc.) Europe 1-3 14% Emission control (Secondary air syst., etc.) Europe 1 24% Pumps (Oil, water, vacuum) Europe 1-2 13% KS Pist
Slide 9: Optimization of worldwide production structures with emphasis on Asia
Rheinmetall Automotive Optimization of worldwide production structures with emphasis on Asia Germany Berlin Hamburg Hartha Japan, Hiroshima Neckarsulm Establishment of Canada Nettetal Czech Rep./Ùstì a customer service Neuss New plant for Center. Leamington France Papenburg Pierburg on site First de
Slide 10: New production facilities in best cost countries
Rheinmetall Automotive New production facilities in best cost countries Ústí, Czech Republic Celaya, Mexico 760 employees in two factories Purchase of the original equipment piston operation from Pistones Moresa Significant increase in piston production (1995: 2 million, 2005: 9.5 million pist
Slide 11: Sustainable growth trends of the Rheinmetall-Automotive business
Rheinmetall Automotive Sustainable growth trends of the Rheinmetall-Automotive business Rising oil price leads to need for fuel saving Further weight reduction of engine components Stricter emission norms in Europe demand further emission control Outsourcing of production by the OEMs Diesel trend co
Slide 12: Growth trends in the Automotive business: Fuel saving and weight reduction
Rheinmetall Automotive Growth trends in the Automotive business: Fuel saving and weight reduction Electric coolant pump LiteKS piston Innovation from Pierburg: Weight reduction up to 15% Cooling on demand Increase of durability by more than 30% Meets EU4/EU5 norms Modern casting techniques
Slide 13: Growth trends in the Automotive business: Emission control
Rheinmetall Automotive Growth trends in the Automotive business: Emission control Restrictive emission norms in Europe Exhaust gas recirculation valve Particle emission [g/km]* 0,05 EU 3 (since 2000) 0,04 0,03 EU 4 (since 2005) 0,02 0,01 Exhaust gas recirculation valve gaining EU 5 (expected in 20
Slide 14: Growth trends in the Automotive business: Outsourcing and diesel trend
Rheinmetall Automotive Growth trends in the Automotive business: Outsourcing and diesel trend Final machining of engine blocks Diesel pistons Final machining for all Porsche Special technology for diesel-pistons Cayenne engine blocks Very high pressure during the Negotiations for further fin
Slide 15: Corporate sector Defence
RHEINMETALL Corporate sector Defence 15
Slide 16: Rheinmetall Defence systems and components for the ground forces
Rheinmetall Defence Rheinmetall Defence systems and components for the ground forces Rheinmetall Defence Sales 2004: € 1.4 billion, Employees: 6,800 Land Systems Air Defence Systems Weapon Munition Defence Electronics • Armoured wheeled and • Air defence systems • Weapons and ammunition • Command co
Slide 17: Leading systems integrator for ground forces technology in Europe
Rheinmetall Defence Leading systems integrator for ground forces technology in Europe Sales 2003 in € billion 1.6 0.8 0.7 0.7 0.7 0.5 0.3 Rheinmetall KMW Diehl GIAT Alvis / Alenia / GD / Defence Hägglunds Oto Melara Mowag Source: Defence News 17
Slide 18: Army transformation as growth driver in the defence business
Rheinmetall Defence Army transformation as growth driver in the defence business Real time reconnaissance Protection of soldiers in action High strategic and tactical mobility for out of area-missions Rising importance of air defence systems Increased demand for services: Maintenance and upgrading P
Slide 19: Growth trends in the defence business: Reconnaissance and protection
Rheinmetall Defence Growth tends in the defence business: Reconnaissance and protection UAV/Drones Protective wheeled and armoured vehicles Unmanned aerial reconnaissance High degree of protection against Air-transportable armoured vehicle keeps soldiers out of harm‘s way battlefield hazards s
Slide 20: Growth trends in the defence business: High mobility and rising importance of air defence
Rheinmetall Defence Growth trends in the defence business: High mobility and rising importance of air defence Puma Multi Mission Effects Vehicle Can be airlifted to crisis regions in the Mobile system for varying missions: new A400M transport aircraft Anti-Tank and Air-Defence capabilities Exc
Slide 21: Growth trends in the defence business: Maintenance, upgrading and public security
Rheinmetall Defence Growth trends in the defence business: Maintenance, upgrading and public security Sale of used Leopards Protection of power plants EOD-robots Greece Smoke-screen system Remote controlled Explosive Ordnance Disposal (EOD) Expected order volume for RHM: Conceals exact locat
Slide 22: Rheinmetall Group – Financials and Outlook
Rheinmetall Group – Financials and Outlook 22
Slide 23: Q3/2005 highlights
Rheinmetall Group Q3/2005 highlights Rheinmetall confirms stable organic growth trend: sales plus 4% Order intake Defence plus 81% Adjusted EBIT goes up by € 8 million to € 129 million Interest result further improved 23
Slide 24: Organic growth in key businesses
Rheinmetall Group Organic growth in key businesses Sales Q3/2004 like-for-like (LFL) vs. Q3/2005 Organic growth € million 2004 2,320 Rheinmetall 2,420 + 4.3% 2005 Group 2004 1,465 Automotive + 4.4% 2005 1,530 2004 850 Defence + 4.2% 2005 885 24
Slide 25: Interest result further improved
Rheinmetall Group Interest result further improved in € million Q1-Q3/2004 Q1-Q3/2005 Change EBIT 136 119 (17) Interest result (49) (38) 11 EBT 87 81 (6) Taxes (28) (26) 2 Group earnings after 3 quarters 59 55 (4) 25
Slide 26: Adjusted EBIT goes up
Rheinmetall Group Adjusted EBIT goes up in € million Q1-Q3/2004 Q1-Q3/2005 Change EBIT 136 119 (17) Extraordinary gains/losses (15) 10 25 Adjusted EBIT 121 129 8 Adjusted EBIT-margin 5.0% 5.3% 26
Slide 27: Automotive: Financials
Rheinmetall Group Automotive: Financials in € million Q1-3/2004 Q1-3/2005 Change Sales 1,465 1,530 65 EBIT 108 101 (7) EBIT-margin 7.4% 6.6% Adjusted EBIT 100 102 2 Adjusted EBIT-margin 6.8% 6.7% EBT 88 87 (1) Capex 74 111 37 Depreciation 89 88 (1) 27
Slide 28: Defence: Financials
Rheinmetall Group Defence: Financials in € million Q1-3/2004 Q1-3/2005 Change Sales 853 885 32 Order intake 639 1,154 515 Order backlog (9/30) 2,485 2,695 210 EBIT 23 32 9 EBIT-margin 2.7% 3.6% Adjusted EBIT 25 36 11 Adjusted EBIT-margin 2.9% 4.1% EBT 9 19 10 28
Slide 29: Outlook 2005
Rheinmetall Group Outlook 2005 Organic sales growth continues through 2005 Earnings improved on prior year Reduction of net interest expense 29
Slide 30: Disclaimer
Rheinmetall Group Disclaimer Any statements contained in this document that are not historical facts are forward-looking statements as defined in the U.S. Private Securities Litigation Reform Act of 1995. Any forward-looking statement contained in this presentation represents our best judgment as to