Knorr-bremse Ag · XETR:KBX
Knorr-bremse — Q1 2023 Earnings Presentation
25 slides from Knorr-bremse's earnings presentation, May 11, 2023
Slide 1: Financial Results Q1/23
FINANCIAL RESULTS Q1/23 MARC LLISTOSELLA I CEO FRANK WEBER I CFO MAY 11, 2023
Slide 2: Key take-aways for today
Key take-aways for today Q1/23 development as expected – strong revenues and EBIT growth but margin impacted predominantly by inflation Robust demand in both divisions continues Portfolio review with good progress – Kiepe sale with good progress; sale of Sheppard foundry signed Russia – lega
Slide 3: Good underlying demand in rail and truck markets continues
Good underlying demand in rail and truck markets continues Current situation Outlook FY23 EU/ NA: strong support by stimulus programs and Ridership: EU full recovery to pre-Covid-19 level expected sustainability efforts EU/ NA: good demand should continue CN: good momentum of ridership supporting AM
Slide 4: Financial highlights Q1/23: strong demand and high order book lead to revenue growth
Financial highlights Q1/23: Strong demand and high order book lead to revenue earnings growth but weaker profitability REVENUES OF € 1.91bn 10.0% op. EBIT MARGIN (14.3% yoy) (PY: 10.9%) € 855m €1,053m 13.1% 9.0% € -199m FREE CASHFLOW (PY: € -231m) -150% Cash Conversion Rate ORDER INTAKE € 2.18bn ORD
Slide 5: Continuous invest into ability to deliver and revenue growth
Continuous invest into ability to deliver (“Customer First”) and revenue growth ahead while focused spending and stringent NWC management in place CapEx NWC ROCE (annualized) €m % of sales Scope of days % 71.7 67.4 3.9% 3.4% 18.0% 1,521 16.3% 64 64 1,250 Q1/22 Q1/23 31.03.22 31.03.23 31.03.22 31.03.
Slide 6: FCF improved but still impacted by higher NWC
FCF improved but still impacted by higher NWC while FY23 expectations remain unchanged Free Cashflow1 Cash Conversion Rate €m ▪ Built-up of inventory due to ongoing supply constraints, uncertain market environment and safeguarding revenue increase in the coming quarters resulted in higher NWC ▪ Acco
Slide 7: RVS: Good order intake and order book on new record level
RVS: Good order intake and order book on new record level Order intake Order book €m +20.2% Order intake on high level 1.39 Book-to-bill 1.17 ▪ EU: OE softer in HS and freight, partially 5,026 compensated by increase in metro; AM higher, also driven by acquisition of DSB -7.4% 1,081 4,181 ▪ APAC: Ov
Slide 8: RVS: Good demand driving revenue growth, but reduced profitability
RVS: Good demand driving revenue growth in Q1/23, but reduced profitability Revenue op. EBIT €m Revenue higher yoy in Q1/23 supported by AM business 15.7% ▪ EU: Higher revenues driven by AM +10.3% ▪ APAC: Higher revenues in CN and rest of APAC 13.1% (OE stable, AM higher), India softer incl. weaker
Slide 9: RVS: Q1 profitability expected on the lower side, Q2-Q4 better
RVS: Q1 profitability expected to be on the lower side while Q2-Q4 expected to be better Profitability RVS in RoS (%) 15.7% >13.1% 13.1% -1.6% -1.0% Volume Operating leverage (e.g. China) PCPP Ongoing inflationary Inflation/ price cost pressure Mix PCPP (incl. pricing) R&D Planned sale of Kiepe Q1/2
Slide 10: CVS: Order intake strong and order book on high level
CVS: Order intake strong and order book on high level Order intake Order book €m Order intake increases qoq and yoy, BtB remains well above 1 1.15 Book-to-bill 1.12 +14.1% 2,091 ▪ EU/ NA: Demand remains on high level, still +14.2% customers shift orders on short notice without 1,832 cancelling, stro
Slide 11: CVS: Revenues significantly up and profitability started to recover
CVS: Revenues significantly up and profitability started to recover Revenue op. EBIT €m Growth of revenues in OE based on better market and pricing, AM remains strong 8.5% 9.0% ▪ EU/ NA: revenue increase yoy supported by price +17.7% agreements, higher TPR and good AM (Cojali) 30 9 1,053 ▪ APAC: CN
Slide 12: Guidance FY23 confirmed
Guidance FY23 confirmed Revenue op. EBIT margin (RoS) Free Cashflow Assumptions €m % €m ▪ Current exchange rates 7,300-7,700 ▪ Essentially stable geopolitical 7,150 and macroeconomic 350-550 conditions 10.5-12.0% 11.1% ▪ No new lockdowns due to Covid ▪ Inflationary cost increases will be compensated
Slide 13: We take stringent measures to improve our profitability
We take stringent measures to improve our profitability Profit and Cash Protection Program and Portfolio Adjustment Geopolitics Restructuring China Kiepe (in progress) (RVS and CVS) Challenging Supply environment with Business Further chain climate measures net cost burden of under € ~300m vs. FY22
Slide 14: Update CEO agenda
Update CEO agenda KB onboarding First 4 months Strengthening team spirit Creation of KB’s target picture started Portfolio optimization Coming months Identification of further efficiency measures Identification of new profitable growth segments Communication of STRATEGY UPDATE on July 18 14
Slide 15: Q&A / Backup
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Slide 16: Financial calendar: Upcoming events
Financial calendar: Upcoming events Date Event May 15, 2023 Post Q1/23 roadshow, virtually May 16, 2023 Post Q1/23 roadshow, Swisse June 7, 2023 BNP Paribas CEO Conference, Paris June 8, 2023 JP Morgan CEO Conference, Pennyhill June 21, 2023 dbAccess Conference, Frankfurt August 10, 2023 Q2/23 finan
Slide 17: Order intake and order book in Q1/23 underline strong ongoing demand
Order intake and order book in Q1/23 underline strong ongoing demand in both markets Order intake Order book €m €m 1.26 Book-to-bill 1.14 +18.6% 7,116 +3.2% 5,998 2,109 3 54 10 2,176 RVS RVS 0.1% RVS 737 RVS RVS 5,026 1,000 1,081 4,181 CVS CVS 1,176 CVS CVS 1,030 CVS 1,832 2,091 1,657 Q1/22 Organic
Slide 18: Group revenue development positive driven by all regions
Group revenue development positive driven by all regions Revenue €m By type By region +14.3% 53 3 1,908 1,908 SA 182 0.5% 35 1,669 1,669 34 422 Asia/ 10.9% 5.4% Pacific RVS RVS 400 775 855 27.5% 495 NA 388 CVS CVS 12.9% 957 EU 895 1,053 847 Q1/22 Organic M&A FX Q1/23 Q1/22 Q1/23 y-o-y growth 18
Slide 19: Q1/23 – Group op. EBIT growth vs. prior year
Q1/23 – Group op. EBIT growth vs. prior year op. EBIT/ EBIT Margin €m 10.9% 10.0% +5.6% Reported: 182 (10.9%) 182 11 6 192 Reported: 190 (10.0%) -7 RVS RVS 112 122 (13.1%) (15.7%) CVS CVS 95 76 (9.0%) (8.5%) Q1/22 Organic M&A FX Q1/23 19
Slide 20: Q1/23: income statement
Q1/23: income statement INCOME STATEMENT 2022 2023 €m Q1/22 Q2/22 Q3/22 Q4/22 FY22 Q1/23 Revenues 1,669.4 1,736.7 1,792.0 1,951.7 7,149.7 1,907.6 Change in inventory of unfinished/finished products 54.0 8.3 43.6 -76.0 30.0 5.4 Own work capitalized 24.6 24.1 28.1 28.1 105.0 27.1 Total operating perfo
Slide 21: Q1/23: cashflow
Q1/23: cashflow CASHFLOW STATEMENT (shortened) 2022 2023 €m Q1/22 Q2/22 Q3/22 Q4/22 FY 2022 Q1/23 Net cash flows from/used in operating activities -189.6 36.7 121.6 572.9 541.6 -137.0 Net cash flows from/used in investing activities -35.3 -125.8 -69.5 -274.3 -505.0 -110.7 Net cash flows from/used in
Slide 22: Q1/23: balance sheet / assets
Q1/23: balance sheet / assets 2022 2023 €m 31.03.2022 30.06.2022 30.09.2022 31.12.2022 31.03.2023 Assets Intangible assets and goodwill 1,016.5 1,017.4 1,068.5 1,340.2 1,337.7 Property, plant and equipment 1,798.8 1,786.0 1,850.5 1,814.5 1,820.0 Investments accounted for using the equity method 22.5
Slide 23: Q1/23: balance sheet / liabilities
Q1/23: balance sheet / liabilities 2022 2023 €m 31.03.2022 30.06.2022 30.09.2022 31.12.2022 31.03.2023 Equity Subscribed capital 161.2 161.2 161.2 161.2 161.2 Capital reserves 13.9 13.9 13.9 13.9 13.9 Retained earnings 10.3 10.0 10.3 10.3 10.3 Other components of equity -157.9 -93.2 -49.7 -123.9 -13
Slide 24: Investor relations contact
Investor relations contact Andreas Sophia Spitzauer Kursawe +49 89 3547 182310 +49 89 3547 187311 +49 175 5281320 +49 151 62330709 Andreas.Spitzauer@knorr-bremse.com Sophia.Kursawe@knorr-bremse.com 24
Slide 25: Disclaimer
Disclaimer IMPORTANT NOTICE This presentation has been prepared for information and background purposes only. It does not constitute or form part of, and should not be construed as, an offer of, a solicitation of an offer to buy, or an invitation to subscribe for, underwrite or otherwise acquire, an