Wacker Neuson Se · XETR:WAC
Wacker Neuson — FY2017 Earnings Presentation
36 slides from Wacker Neuson's earnings presentation, Mar 20, 2018
Slide 1: Press Conference, Analysts' and Investors' Conference – Results FY 2017
Wacker Neuson SE Press Conference, Analysts’ and Investors’ Conference – Results FY 2017 Martin Lehner (CEO), Wilfried Trepels (CFO), Alexander Greschner (CSO) March 20, 2018
Slide 2: Agenda
Agenda Overview Strategy 2022 Financial Information Outlook 2018 Sales & Service 2
Slide 3: Summary of FY 2017: Revenue and earnings in line with raised forecast
Summary of FY 2017: Revenue and earnings in line with raised forecast Favorable business climate and upswing in all key regions Revenue Asia-Pacific -5% yoy, Group revenue +13% yoy, substantial rise in EBIT (+48% yoy) (e. g. drop in gasoline breakers, initial stocking of new Strong growth in
Slide 4: 2017: Increasing demand for construction equipment worldwide
2017: Increasing demand for construction equipment worldwide Global construction equipment market Construction business climate Germany 1,000,000 Business climate construction industry Sales of construction ifo business climate 900,000 +15% equipment grew by 15% in Actuall business 800,000 2017 Ex
Slide 5: 2017: Recovery of ag markets
2017: Recovery of ag markets Development of agricultural sector in Germany Price developments for butter & milk in the EU Index: 0 baseline corresponds to mean value for years 2000 to 2006. Source: German Farmers’ Association, December 2017. Source: Nilesen, Milchindustrieverband, Die Welt, 2017 5
Slide 6: 2017: Wacker Neuson improved all relevant key figures
2017: Wacker Neuson improved all relevant key figures Q4/17 FY 2017 Revenue EBIT Adj. EBIT Revenue EBIT Adj. EBIT +13% +73% +107% +13% +48% +70% (391.5 m€) (margin: 7.8%) (margin: 9.3%) (1,533.9 m€) (margin: 8.6%) (margin: 9.4%) Op. CF FCF EPS Op. CF FCF EPS +96% +141% +50% +74% +180% +54% (63.1 m€)
Slide 7: Agenda
Agenda Overview Strategy 2022 Financial Information Outlook 2018 Sales & Service 7
Slide 8: Business performance: Revenue and EBIT by region
Business performance: Revenue and EBIT by region1 Revenue and EBIT Q4/17 Revenue and EBIT FY 2017 m€ m€ share yoy EBIT1 share yoy EBIT1 Europe 294 75% +14% 39 Europe 1.130 1,130 74% +11% 150 Americas 84 22% +13% -3 Americas 358 23% +23% -1 Asia-Pacific 13 3% -7% -4 Asia-Pacific 47 3% -5% -10 Total 3
Slide 9: Business performance: Revenue by segment
Business performance: Revenue by segment1 Revenue Q4/17 Revenue FY 2017 m€ m€ share yoy share yoy Light Equipment 97 24% +15% Light Equipment 423 27% +12% Compact Equipment 217 54% +15% Compact Equipment 818 52% +15% Services 86 22% +6% Services 320 21% +8% Total 399 392 100% +13% Total 1.561 1,534
Slide 10: Quarter-on-quarter comparison: Revenue and EBIT margin
Quarter-on-quarter comparison: Revenue and EBIT margin Acceleration of growth in H2/17 10
Slide 11: Development of revenue and profitability Q4/17
Development of revenue and profitability Q4/17 Income statement (extract) and number of employees Gross Profit (in m€) Q4/17 Q4/16 Change in % Volume effect: +11.6 m€ Revenue 391.5 347.9 12.5 Margin effect: +5.7 m€ Capacity utilization improved Gross profit (as a % of revenue) 110.2 (28.1) 9
Slide 12: Development of revenue and profitability FY 2017
Development of revenue and profitability FY 2017 Gross Profit Income statement (extract) and number of employees Volume effect: +47.8 m€ (in m€) FY 17 FY 16 Change in % Margin effect: +11.2 m€ Capacity utilization improved at production sites Revenue 1,533.9 1,361.4 12.7 Sale of “old inven
Slide 13: Key figures from balance sheet – excellent credit standing
Key figures from balance sheet – excellent credit standing Net financial debt and gearing1 Net financial debt/EBITDA2 (in m€) 250 -28% 50% 206 1.3 -46% 199 1.2 1.2 200 177 180 40% 148 0.9 150 30% 0.7 19% 18% 19% 19% 100 13% 20% 50 10% 0 00% 2013 2014 2015 2016 2017 2013 2014 2015 2016 2017 1 calcula
Slide 14: Business performance: Increased Free Cash Flow – Reduced inventory & NWC
Business performance: Increased Free Cash Flow – Reduced inventory & NWC Free Cash Flow Inventory / DIO1 (in m€) (in m€) (in days) 459 -22 m€ 150 500 449 437 195 2.8 x 400 379 99 347 185 100 170 300 166 -15% 175 64 158 165 200 154 50 35 155 30 25 145 100 145 0 0 135 2013 2014 2015 2016 2017 2013 201
Slide 15: Share & Dividend proposal to AGM on May 30, 2018
Share & Dividend proposal to AGM on May 30, 2018 2017: Outperfomance of market and peergroup 2,5 Stable dividend policy (40 – 50% payout ratio) 100% 80% +93% 62% % 53% 2 46% 48% 60% 200 Market Cap > 2 bn€1 38% 40% 180 1,5 20% 1,30 1,25 160 0% 140 1 0,87 0,94 -20% 0,81 0,60 -40% 120 0,50 0,50 0,50 0,
Slide 16: Agenda
Agenda Overview Strategy 2022 Financial Information Outlook 2018 Sales & Service 16
Slide 17: 2017: Ag business was a growth driver (14% of group revenue)
2017: Ag business was a growth driver (14% of group revenue) Weidemann and Kramer Ag business revenue1 +17% yoy (in m€) 216 +17% 184 2016 2017 New partnership with John Deere since Q3/17 After 3 difficult years upbeat mood in agricultural industry (overcompensation of revenues with former allian
Slide 18: 2017: Relocation of skid steers production to the US already pays off
2017: Relocation of skid steers production to the US already pays off Skid steer as key product for North American market Development of contracted dealers in North America Skid Steer market North America 2016 – 2020e (units) 100,000 89,000 91,000 81,000 +2% 75,000 +10% 50,000 25,000 0,000 2016 2017
Slide 19: 2017: Setting the base for further growth in Asia
2017: Setting the base for further growth in Asia Successful start of production of mini excavators in Pinghu (China) Building on local/regional presence Demand for repair and maintenance of infrastructure is growing, especially in megacities Mini excavators for China and the region Plot of
Slide 20: 2017: Strategic alliances and partnerships leveraged our sales
2017: Strategic alliances and partnerships leveraged our sales Core Markets: Europe & North America OEM (global1) OEM (global) Distribution (EMENA & CIS2) Wacker Neuson produces for Caterpillar1 HAMM produces for Wacker Neuson Kramer3 distributes via JD‘s dealer network Latin America and Asia OEM (L
Slide 21: Leading alternative drive technologies
Leading alternative drive technologies 21
Slide 22: New products & innovations 2018 (extract)
New products & innovations 2018 (extract) Battery plate AP1850e New wheel loader Weidemann & Kramer Dual view Dumper One battery New all-wheel steered Kramer and Wheel dumper with rotating seat for articulated steered Weidemann driving in both directions machines extend range on the upper end
Slide 23: Voice of customer
“Voice of customer” Customer centric product development – Voice of customer, Frontloading, …and more! Integrate our Customers in the complete Product Development Process Contractors and Channels (Dealers, Rentals, Service companies, etc.) 23
Slide 24: Services
Services Core Market segments and geographies - “Close to our Customers” Contractors, rental companies, farms, railway, industrial groups, retailers … Training E-Business Rental Service Spare Parts Financing Telematics Used We work in markets… …where we provide a competitive product & service packag
Slide 25: Agenda
Agenda Overview Strategy 2022 Financial Information Outlook 2018 Sales & Service 25
Slide 26: Tailwind from global construction industry
Tailwind from global construction industry 2017–2021 machinery sales +11% Wacker Neuson’s expectations 1,000,000 +11% Most major regional equipment markets are 900,000 +15% expected to see growth in 2018 800,000 Europe and Americas main growth drivers 700,000 Europe: strong business in the con
Slide 27: Guidance: 2018 and mid-term (2022)
Guidance: 2018 and mid-term (2022) Financial Forecast Expectations for 2018 Challenges Mid-term goal 2017 2018e1 Rising prices of raw material due to high (2022) demand and trend to protectionism Possible supply shortage could lead to Revenue EUR bn 1.53 1.65 – 1.70 >2 production delays Strong
Slide 28: Agenda
Agenda Overview Strategy 2022 Financial Information Outlook 2018 Sales & Service 28
Slide 29: Our Strategy Process
Our Strategy Process Vision 5. Where we are headed Equity € Targets 4. How we measure success Strategy 3. What drives us forward Strengths & Values 2. What we build on Mission 1. What do we stand for 29
Slide 30: Our Mission
Our Mission What do we stand for Everything we do, think and learn is inspired by the success of our customers in the construction and agricultural sectors. We stay close to our customers around the world so we are always getting quicker and better at understanding their regional needs, challenges a
Slide 31: Our Vision 2022
Our Vision 2022 Where we are headed We are the most innovative trendsetter in the industry, growing twice as fast as the market. We are the partner of choice for our customers. Our core strengths lie in closer customer ties, customer-centric product development, digitalization and product/service ne
Slide 32: What will drive us forward?
What will drive us forward? To reach our goals 2022 32
Slide 33: How we measure success
How we measure success Mid-term targets 2022 33
Slide 34: Strategy 2022
STRATEGY 2022 Wacker Neuson Group WHERE WE ARE HEADED “aA MEASURE Top3 = 2times «= >€2bn => 11% =< 30% Suecess whee reduce tttaouh Ree — nme “a WHAT DRIVES US FORWARD Focus Products & Services | Customer Benefits Markets: CUSTOMER CENTRICITY anita EXCELLENCE ACCELERATION Innovation Digitalization Qu
Slide 35: Disclaimer
Disclaimer Cautionary note regarding forward-looking statements The information contained in this document has not been independently verified and no representation or warranty expressed or implied is made as to, and no reliance should be placed on, the fairness, accuracy, completeness or correctn
Slide 36: Financial Calendar
Financial Calendar March 20, 2018 Publication of annual report 2017; Analysts’ and Investors’ Conference, Frankfurt April 20, 2018 Deutschlandkonferenz Bankhaus Lampe, Baden-Baden May 8, 2018 Publication of Q1 report 2018; Analyst Conference Call May 14, 2018 Roadshow London May 15, 2018 Roadshow Zu