Kendrion N.v. · EURONEXT:KENDR
Kendrion — Shareholder Meeting (June 2020)
32 slides from Kendrion's shareholder meeting presentation, Jun 24, 2020
Slide 1: General Meeting of Shareholders Kendrion N.V.
GENERAL MEETING OF SHAREHOLDERS KENDRION N.V. 24 JUNE 2020
Slide 2: Cautionary Note Regarding Forward Looking Statements
CAUTIONARY NOTE REGARDING FORWARD LOOKING STATEMENTS Certain statements contained in this presentation constitute forward-looking statements. These statements may include, without limitation, statements concerning future results of operations, the Company's share of new and existing markets, general
Slide 3: Agenda
AGENDA 1. Kendrion overview 2. COVID-19 3. Business review 4. Strategic and operational update 5. Summary 6. Q&A 3
Slide 4: 1. Kendrion overview
1. Kendrion overview 4
Slide 5: Our Organisation
KENDRION PRECISION. SAFETY. MOTION. OUR ORGANISATION ‘Sweden 4 /, Ww Great Britain [ ‘ 4 Germany \ The Netherlands | eo | Czech Republic ° I 5 Employees | we | Austria 2,522 _— \ C i Romania ° » . United States ° \ Revenue mix / ° \ "qT China Industrial | yi | Actuators and / i Controls . / india a
Slide 6: New Business Units
NEW BUSINESS UNITS Markets that offer opportunity for profitable growth AUTOMOTIVE INDUSTRIAL BRAKES INDUSTRIAL ACTUATORS AND CONTROLS Innovative mobility solutions for Full-line provider of electromagnetic passenger cars and commercial brakes, spring-applied brakes and Industrial automation, lockin
Slide 7: Our Organisation's Structure
OUR ORGANISATION’S STRUCTURE Management Team as of 1 January 2020 Executive Board Group HR Group IT General Counsel President Kendrion BU Manager BU Manager COO Automotive CCO Automotive FD Automotive Asia/Strategic Industrial Actuators Industrial Brakes Purchasing and Controls 7
Slide 8: Agenda
AGENDA 1. Kendrion overview 2. COVID-19 3. Business review 4. Strategic and operational update 5. Summary 6. Q&A 8
Slide 9: 2. COVID-19
2. COVID-19 9
Slide 10: Leadership in Times of Crisis
LEADERSHIP IN TIMES OF CRISIS Decisions, decisions! Be brave Unity of effort: we are all in the same boat Learn and correct if needed We stick to our values 10
Slide 11: Consumer spending is taking a hit around the world
Preliminary — not client shareable Consumer spending is taking a hit around the world SELECTED EXAMPLES cv) ? 95% 70% i1@) Decrease in on-site Decrease in air travel diners across the US, demand in China, the UK and Germany South Korea, Japan, and Italy iv) iv) 6 p>) 45% 30% Decrease in foot Reducti
Slide 12: Scenarios for the Economic Impact of the COVID-19 Crisis
Updated April 20, 2020 Scenarios for the Economic Impact of the COVID-19 Crisis GDP Impact of COVID-19 Spread, Public Health Response, and Economic Policies Rapid and effective control of virus spread B1 A3 A4 Strong public health response succeeds in controlling spread in each country within 2-3 mo
Slide 13: Scenario A3: virus contained, growth returns
Updated April 20, 2020 Scenario A3: virus contained, growth returns Large economies China1 United States Real GDP, indexed Real GDP Drop 2020 GDP Return to Pre- Eurozone 2019Q4-2020Q2 Growth Crisis Level Local Currency Units, 2019 Q4=100 World % Change % Change Quarter (+/- 1Q) 110 Lockdown April-Ma
Slide 14: Scenario A1: virus recurrence, with muted recovery
Updated April 20, 2020 Scenario A1: virus recurrence, with muted recovery Large economies China1 United States Real GDP, indexed Real GDP Drop 2020 GDP Return to Pre- Eurozone 2019Q4-2020Q2 Growth Crisis Level Local Currency Units, 2019 Q4=100 World % Change % Change Quarter (+/- 1Q) 110 Lockdown Ap
Slide 15: COVID-19: Priorities
COVID-19: PRIORITIES 1. Keep our employees and their families healthy and safe 2. Protect the job of everybody currently employed at Kendrion, in all parts of the world 3. Safeguard the Group’s continuity so that when we come out of this, our prospects are better than ever 15
Slide 16: Key Actions
KEY ACTIONS 1. Kurzarbeit direct workers 2. Kurzarbeit indirect workers 3. A voluntary reduction in salary of 15% by management including RvC 4. Minimal capital investment protecting current and future revenue 5. No use of consulting or other external services 6. Aggressive managing of inventory, bo
Slide 17: 3. Business review
KENDRION PRECISION. SAFETY. MOTION.
Slide 18: Full-Year Results 2019
FULL-YEAR RESULTS 2019 Normalised (in EUR million) FY 2019 FY 2018 delta Revenue 412.4 448.6 -8% EBITDA 43.4 58.5 -26% EBITA 19.4 35.4 -45% Net profit 10.6 22.6 -53% EBITDA as a % of revenue 10.5% 13.0% EBITA as a % of revenue 4.7% 7.9% Return on invested capital (12 months rolling) 7.1% 12.4% Norma
Slide 19: First Quarter Results 2020
FIRST QUARTER RESULTS 2020 1% increase in revenue. Organic revenue (excluding INTORQ) decrease of 12% EUR 5 million structural cost savings implemented in Q4 2019 fully effective and an additional EUR 0.6 million savings implemented One-off costs of EUR 1.1 million for incurred related to the
Slide 20: 4. Strategic and operational update
4. Strategic and operational update 20 20
Slide 21: Kendrion Strategic House
KENDRION STRATEGIC HOUSE STRATEGIC INTENT AUTO BRAKES IAC 'ACES' INTORQ ENERGY ROBOTS CONTROLS TRANSPORT CHINA CHINA CHINA KENDRION GLOBAL ORGANISATION 21
Slide 22: Nominations Automotive
NOMINATIONS Automotive 2018 2019 100% = EUR 340 million 100% = EUR 320 million 39% 35% 61% 65% Independent ICE technology Independent ICE technology book-to-bill 1.20 book-to-bill 1.25 22
Slide 23: Lighthouse Platforms Automotive
LIGHTHOUSE PLATFORMS Automotive Combination of modular valve systems and electronic control units, aligned with future car computer architecture Smart actuation Development is proceeding as planned Nomination in OEM platform for battery cooling platform Supporting the legal sound requirements fo
Slide 24: INTORQ at a Glance
INTORQ AT A GLANCE Brakes Key statistics Presence 2018-2019 revenue: EUR 57 million (April year-end) Aerzen (HQ, Germany) Employees: ~300 Shanghai (China) Units per year: ~1 million Atlanta (USA) Global network: 63 sales partners in 49 countries Pune (India) Application areas Main pr
Slide 25: Compelling Strategic Rationale
COMPELLING STRATEGIC RATIONALE Brakes Substantial strengthening of our position in industrial brakes Further expansion of our footprint in the Chinese growth market INTORQ's strength in spring-applied brake technology complementary to Kendrion's Strong leading position in permanent magnet brak
Slide 26: Industrial Actuators and Controls
INDUSTRIAL ACTUATORS AND CONTROLS ICS/IMS Combination of Industrial Control Systems and Industrial Magnetic Systems Effective as of 1 January 2020 Focus on profitability in four distinct verticals Key market segments Machinery Transportation Energy distribution Fluid control 26 26
Slide 27: Commercial Traction China
COMMERCIAL TRACTION China Business review Year-on-year growth of 29% despite difficult market Successful ramp of park lock production for local key automotive car player Lifetime nominations 2019 significantly higher than size of business Permanent magnet brake project awarded for Germany +
Slide 28: Progressing on CSR
PROGRESSING ON CSR Target framework 2019-2023 Completed the five-year CSR roadmap and started with implementation 2.5% absolute energy reduction in 2019 8.5% decrease in absolute CO₂ emission Established a health task force to further reduce illness rate from current level of 2.9% 28 28
Slide 29: 5. Summary
KENDRION PRECISION. SAFETY. MOTION.
Slide 30: Summary
SUMMARY The effects of the COVID-19 corona virus on our business are severe Automotive most affected Industrial more stable China ‘back to normal’ Kendrion has taken maximum measures with the objective to optimise and protect liquidity and cash flow The global economic outlook is highly
Slide 31: 6. Questions & answers
KENDRION PRECISION. SAFETY. MOTION. 6. Questions & answers \.
Slide 32: Kendrion
KENDRION