Durr AG · XETR:DUE
Durr — Warburg German Industrials Conference (May 2008)
34 slides from Durr's conference presentation, May 19, 2008
Slide 1: Investor Presentation Warburg German Industrials Conference
Investor Presentation Warburg German Industrials Conference Dürr Aktiengesellschaft Ralf W. Dieter, CEO Günter Dielmann, IR Frankfurt, May 19, 2008
Slide 2: Disclaimer
Disclaimer This investor presentation has been prepared independently by Dürr AG (“Dürr”). The presentation contains statements which address such key issues as Dürr´s strategy, future financial results, market positions and product development. Such statements should be carefully considered, and it
Slide 3: Global systems partner to the automotive and supplier industry
Global systems partner to the automotive and supplier industry § World market leader in painting, balancing and cleaning technology, leading position in final assembly technology, with market shares of up to 50% § Appr. 60% of paint shops and appr. 50% of assembly plants worldwide are equipped with
Slide 4: Group structure
Group structure DÜRRAG DÜRR AG Paint and Assembly Systems Measuring and Process Systems Share of sales ~ 70% Share of sales ~ 30% § Paint and Final Assembly Systems § Balancing and Assembly Products Turnkey paint shops and final assembly plants; Balancing and diagnostic systems (automotive, service
Slide 5: Automotive industry in FOCUS
Automotive industry in FOCUS © Dürr Aktiengesellschaft, CCI, Investors Presentation, May 19, 2008 -5-
Slide 6: What makes Dürr unique?
What makes Dürr unique? § 55% of business is plant engineering; 45% is mechanical engineering (assembly). In the mechanical engineering business only key components are manufactured in house § Low production depth limits fixed costs and risks in an economic downturn § Dürr is the only truly global c
Slide 7: 2007 (2006) incoming orders and sales: Well balanced structure
2007 (2006) incoming orders and sales: Well balanced structure Incoming orders Sales revenues 14.9% 17.9% 20.0% 18.6% (28.9%) (16.3%) (20.6%) (20.7%) 31.3% 22.2% (19.9%) 35.9% (21,0%) 39.2% (34.9%) (37.7%) Germany Europe excluding Germany North & South America Asia, Africa, Australia § US & Mexico r
Slide 8: Dürr development since 2005
Dürr development since 2005 2005 - 2007: 2008 - 2010: Successful Restructuring Profitable growth § Focus on profitable business § Emerging markets § New products § Expansion of aircraft assembly business § Individual acquisitions § Leaner organizational structure Growth § Earnings at initiatives ben
Slide 9: 2007 & 2008: Strong demand
2007 & 2008: Strong demand 2007 2006 2005 in € m Incoming orders 1,781.5 1,459.8 1,216.9 Sales revenues 1,476.6 1,361.2 1,400.6 Orders on hand (December 31) 1,082.0 805.2 723.5 § Incoming orders up by 22% in 2007 and 20% in 2006 § Q1 2008: - Book to bill 1.5 - Orders on hand increased by 12% compare
Slide 10: EBIT up by 68% in 2007
EBIT up by 68% in 2007 2007 2006 2005 in € m Gross profit on sales 240.0 220.2 220.2 EBITDA 73.6 52.2 -16.2 EBIT 55.7 33.1 -70.3 Net income 21.2 8.2 -104.5 § Turnaround in US-business and Cleaning and Filtration business unit successfully achieved in 2007 § SG&A costs under control § Q1 2008: EBIT m
Slide 11: Figures/Analysis: Cash flow/Free cash flow
Figures/Analysis Cash flow/Free cash flow 2007 2006 2005 2004 in € m 2005 2005 2004 2004 EBT 34.8 14.8 -106.6 4.5 Income taxes -5.8 -5.6 -4.6 0.8 Interest result 22.9 21.0 35.1 24.5 Amortization and depreciation 17.8 19.1 54.2 21.3 Changes - NWC 37.0 8.8 -82.1 -110.8 - Provisions -4.1 -20.2 -25.1 -2
Slide 12: Solid financial structure
Solid financial structure 03/31/2008 12/31/2007 12/31/2006 12/31/2005 in € m Equity 253.0 257.1 245.7 248.1 Equity ratio 23.3% 23.9% 23.6% 20.9% Net financial debt 57.2 60.7 96.5 84.9 Cash 145.9 147.5 101.5 124.7 Net working capital 96.5 119.9 154.7 171.5 ROCE - 15.0% 7.6% - § Net financial debt sig
Slide 13: 2008: Profitable growth
2008: Profitable growth § 2008: Sales growth of up to 10% § 2008: Strong earnings improvement driven by ► improved processes ► higher margin orders ► turnaround at loss-making final assembly business § 2008: EBIT margin goal of 5% (2007: 3.7%) § Requests for quotation remain strong. The automobile m
Slide 14: Strategy "Dürr 2010"
Strategy “Dürr 2010“ § Emerging markets § New products § Expansion of aircraft assembly business § Individual acquisitions Growth § Earnings at initiatives benchmark level § Optimization of unit costs § ROCE > capital costs Customer Value § Innovation “Dürr 2010“ § Long-term benefit creation positiv
Slide 15: Strategy "Dürr 2010": Customer benefit
Strategy “Dürr 2010“: Customer benefit Dürr will leverage its leading technology and market position Cost-per-unit as value proposition (e.g. RoDip) § Ensure competitive operating costs for our customers § Provide ROI for investments into Dürr equipment Innovative solutions (e.g. LeanLine for small
Slide 16: Strategy "Dürr 2010": Customer benefit (RoDip)
Strategy “Dürr 2010“: Customer benefit Example Cost-per-unit: Latest generation of rotational painting system RoDip Dürr‘s value proposition § 36% less energy § 18% less chemicals § 8% lower capex 16% lower cost-per-unit for pretreatment and anti-corrosion process © Dürr Aktiengesellschaft, CCI, Inv
Slide 17: Strategy "Dürr 2010": Customer benefit (LeanLine)
Strategy “Dürr 2010“: Customer benefit Example Innovative solutions: Addressing the mega trend „low cost cars“ Dürr‘s value proposition: LeanLine concept § Reduced capex by up to 30% § Standardized products and plant layouts § Localization approaches Dürr equipment for Tata Nano plant: Paint shop, r
Slide 18: Strategy "Dürr 2010": Customer benefit, service potential
Strategy “Dürr 2010“: Customer benefit Service: Future potential Age of paint shops* 80% 75 § 60% of all paint shops worldwide are older 71 than 20 years 70% 67 62 60% § Average lifetime in US/Europe up to 50% 30 years, in Asia up to 20 years 39 40% 34 30% 25 26 27 Huge modernization and 17 19 19 20
Slide 19: Strategy "Dürr 2010": Growth initiatives
Strategy “Dürr 2010“: Growth initiatives Dürr will grow above market average by explicit growth initiatives § Further expansion in emerging markets § New products in existing business fields (e.g. consulting, sealing) § Selective smaller acquisitions (e.g. “bolt-on” acquisition in balancing) § Aircr
Slide 20: Strategy "Dürr 2010": Growth initiatives, emerging markets
Strategy “Dürr 2010“: Growth initiatives Example emerging markets: Leveraging our global footprint Incoming orders in % Further building our revenue share from emerging markets, e.g. § Paint Systems in Russia, Turkey, Romania 57 48 and others 73 § Assembly products in Asia 52 43 § Environmental and
Slide 21: Strategy "Dürr 2010": Aircraft and Technology Systems
Strategy “Dürr 2010“: Growth initiatives Example Aircraft and Technology Systems: New business unit Creating a new platform for growth § Providing focus for sales and engineering resources § Bringing together paint and assembly competence § Joint venture with EDAG for Airbus China © Dürr Aktiengesel
Slide 22: Strategy "Dürr 2010": Success with Japanese OEMs
Strategy “Dürr 2010“: Growth initiatives Increasing success with Japanese OEM´s: Gaining market share 80 70 60 50 40 30 20 10 0 2005 2006 2007 sales in € m © Dürr Aktiengesellschaft, CCI, Investors Presentation, May 19, 2008 - 22 -
Slide 23: Strategy "Dürr 2010": Process optimization
Strategy “Dürr 2010“: Process optimization Continuous improvements in operating performance by eight point program 1. Product standardization: reduce engineering hours 2. Design-to-cost: simplify product design 3. Global production: increase share of low cost country manufacturing 4. Global sourcing
Slide 24: Strategy "Dürr 2010": Value creation
Strategy “Dürr 2010“: Value creation Sustained value creation by managing key financial value drivers Achieve returns at benchmark levels § Plant engineering business: 4 - 6% EBIT margin § Machinery business: 8 - 10% EBIT margin Drive ROCE and FCF generation § Focus on asset utilisation, NWC managem
Slide 25: Strategy "Dürr 2010": Goals for 2010
Strategy “Dürr 2010“: Value creation GOALS for 2010 Sales revenues ≥ € 1.7 bn EBIT margin approx. 6% ROCE approx. 22% Equity ratio 30-35% © Dürr Aktiengesellschaft, CCI, Investors Presentation, May 19, 2008 - 25 -
Slide 26: Financial calendar
Financial calendar 08/07/2008 Interim report half year 2008 08/27/2008 Capital Goods & Steel Conference Commerzbank, Frankfurt 09/02/2008 Mechanical Engineering Conference BHF-Bank, Frankfurt 11/06/2008 Interim report January - September 2008 11/10/2008 Deutsches Eigenkapitalforum, Frankfurt Contact
Slide 27: © Dürr Aktiengesellschaft, CCI, Investors Presentation, May 19, 2008
© Dürr Aktiengesellschaft, CCI, Investors Presentation, May 19, 2008 - 27 -
Slide 28: Shareholder structure May 2, 2008
Shareholder structure May 2, 2008 © Dürr Aktiengesellschaft, CCI, Investors Presentation, May 19, 2008 - 28 -
Slide 29: Competitive situation/market shares
Competitive situation/market shares* Business units Paint and Final Assembly Systems Dürr 40%, Eisenmann 20%, Taikisha 13%, Local Competitors: Scivic, Giffin, Geico, Trinity (Toyota) Application Technology Dürr 50%, Fanuc 13%, ABB 12%, Eisenmann 6% Environmental and Energy Systems Dürr 30% Competito
Slide 30: Market outlook
Market outlook The macro-economic environment clearly holds risks for the future But… § Global automotive market is expected to remain a growth industry and to grow by 4% p.a. from 2009 onwards, especially driven by strong emerging market demand § Pipeline includes greenfield projects in India, Chin
Slide 31: Markets - Forecast by growth drivers
Markets - Forecast by growth drivers Emerging markets, new OEM’s and suppliers drive our growth Light vehicle production Light vehicle production Automotive investments volume by region volume by OEM’s (global; € bn) (m units) (m units) 190 +3.7% 73.8 +3.7% 73.8 New players +6.0% CAGR CAGR - China C
Slide 32: Outlook
Outlook Light vehicle production: Forecast 2008-20121) in m units 35 +5.3 30 25 20 +1.7 +1.0 15 +2.3 2008 10 +0.6 +0.6 5 2012 0 North Mercosur Western Eastern Asia Others (incl. America Europe Europe Iran) Source: own estimates, CSM, J.D. Power, PwC © Dürr Aktiengesellschaft, CCI, Investors Presenta
Slide 33: Markets - Our own perceptions
Markets - Our own perceptions Full project pipeline and growing market share Logarithmic illustration in € bn 10 10 5 Projects in the market Paint and Assembly 11 Systems order intake Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 annualized 2004 2005 2006 2007 2008 Source: Own calculations © Dü
Slide 34: Management
Management Ralf Dieter, CEO Ralph Heuwing, CFO § Born in 1961 § Born in 1966 § Chairman of the Board § With Boston Consulting of Management since Group (BCG) since 1990 January 1, 2006 § Since 2001 Partner and § Responsible for Paint and Vice President at BCG in Assembly Systems and Munich; before M
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