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Forvia — Debt Investor Presentation (June 2024)

40 slides from Forvia's debt investor presentation, June 2024

  1. Slide 1: Credit Investor Presentation

    INTERNAL & PARTNERS Credit Investor Presentation June 2024 5acXjzUk

  2. Slide 2: Disclaimer

    INTERNAL & PARTNERS Disclaimer THESE MATERIALS ARE CONFIDENTIAL AND ARE NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN OR INTO OR FROM THE UNITED STATES OF AMERICA, CANADA, AUSTRALIA, JAPAN OR ANY JURISDICTION WHERE SUCH DISTRIBUTION IS UNLAWFUL. IMPORT

  3. Slide 3: Business Overview

    INTERNAL & PARTNERS 01 Business Overview 3 | Credit Investor Presentation| June 2024 5acXjzUk

  4. Slide 4: Journey so far: now the 7th largest automotive supplier worldwide

    INTERNAL & PARTNERS Journey so far: now the 7th largest automotive supplier worldwide From a spin-off from PSA (now part of Stellantis) to a world’s leading automotive supplier with €27bn revenue, following the transformative acquisition of Hella in January 2022 7th Largest Automotive Supplier Globa

  5. Slide 5: World's 7th largest automotive supplier with leading positions in each business segment

    INTERNAL & PARTNERS World’s 7th largest automotive supplier with leading positions in each business segment Seating Interiors Clean Mobility #1 worldwide #1 worldwide Ambition to become in seat structure systems #1 worldwide in Hydrogen Materi’Act #3 worldwide €2bn sales by 2030 #1 worldwide ULE in

  6. Slide 6: Global market leader for sustainable automotive technologies

    INTERNAL & PARTNERS Global market leader for sustainable automotive technologies FORVIA, the 7th global automotive supplier Overview Key Facts • Public company, listed on Euronext Paris with a market capitalisation of ~€3bn • Leading automotive technology company focused on €27bn Engineers Industria

  7. Slide 7: Comprehensive product lines meeting the need of the automotive industry

    INTERNAL & PARTNERS Comprehensive product lines meeting the need of the automotive industry One-in-two vehicles globally is equipped with FORVIA technology 1 Seating 4 Electronics ❯ Sensors & Actuators ❯ Seat structures ❯ Automated Driving ❯ Lighting/Body Electronics ❯ Complete seats ❯ Energy Manage

  8. Slide 8: Six business groups with differentiating product lines

    INTERNAL & PARTNERS Six business groups with differentiating product lines FORVIA is organised in six business groups: Seating, Interiors, Clean Mobility, Electronics, Lighting and Lifecycle Solutions 31% 22% % Revenue 2023 % EBIT 2023 Seating Interiors Clean Mobility Electronics Lighting Lifecycle

  9. Slide 9: Clear and Focus strategy aligned with automotive megatrends

    INTERNAL & PARTNERS Clear and Focus strategy aligned with automotive megatrends MOBILITY AUTOMOUS CONNECTED ELECTRIFICATION DRIVING VEHICLES BEV MARKET GROWTH AUTOMATED DRIVING MARKET GROWTH COCKPIT ELECTRONICS MARKET GROWTH 23-28 CAGR 23-28 CAGR 23-28 CAGR +24% +11% +10% p.a.1 p.a.2 p.a.3 • Battery

  10. Slide 10: Highly diversified business model across geographies, products and customers

    INTERNAL & PARTNERS Highly diversified business model across geographies, products and customers Sales by Sales by Sales by Region Business Group Customer ✓ Forvia benefits from a high Lifecycle Solutions level of 4% Others VW diversification Asia Lighting Seating 27% across the 14% 31% HKMC board O

  11. Slide 11: Key partner to a broad and diversified base of OEMs around the globe

    INTERNAL & PARTNERS Key partner to a broad and diversified base of OEMs around the globe Selected examples of new car models in 2023 with Forvia contents US and Europe new cars launch Asia new cars launch Jeep Avenger Porsche Cayenne Electric SUV Nissan Ariya European Car of the Year 2023 RAM 1500 F

  12. Slide 12: ESG as business driver with net zero leadership

    INTERNAL & PARTNERS ESG as business driver with net zero leadership forthcoming Scopes 1 & 2: 1st automotive Carbon neutral Inauguration of CO2 criteria in short term compensation for net-zero target in 2025 approved by the 4,800 Science Based Targets initiative 1 year in 2023 managers* ahead of sch

  13. Slide 13: Continuous Innovation Capacity to meet future challenges

    INTERNAL & PARTNERS Continuous Innovation Capacity to meet future challenges Skyline Immersive Display FlatLight | µMX 20% 55% CO2 CO2 savings* savings* eMirror Safe UX NAFILean-R Up to 63% 85% CO2 CO2 savings* savings* 13 | Credit Investor Presentation| June 2024 Note: * in 2030 vs. 2019 5acXjzUk

  14. Slide 14: Experienced management with proven track record and robust governance

    INTERNAL & PARTNERS Experienced management with proven track record and supported by robust governance Highly experienced Management with strong track record Supported by a robust governance Monthly review the Group’s results and oversees the operations and deployment of the strategy Oversees busine

  15. Slide 15: Our Competitive Advantages

    INTERNAL & PARTNERS Our Competitive Advantages A portfolio A broad, The adequate size Strategic positions of key international, balanced to meet current in thriving geographic technologies customer portfolio and future challenges markets Leadership A permanent focus A robust One step ahead, in all o

  16. Slide 16: Financial Performance & Outlook

    INTERNAL & PARTNERS 02 Financial Performance & Outlook 16 | Credit Investor Presentation| June 2024 5acXjzUk

  17. Slide 17: Strong operating performance over the last three years

    INTERNAL & PARTNERS Strong operating performance over the last three years In €m Revenue up +74% In €m Operating margin since 2022: +100bps Acquisition of Hella +17% organic +14% organic Adj. EBITDA margin since 2022: +40bps closed on 1st Feb-2022 growth vs. growth vs. Acquisition of Hella Automotiv

  18. Slide 18: 2023 in three key figures

    INTERNAL & PARTNERS 2023 in three key figures ORGANIC SALES OPERATING MARGIN NET DEBT GROWTH OF IMPROVED BY REDUCED BY CLOSE TO 14% 100bps €1bn Outperforming by 430bps To 5.3% of sales Strong NCF of €649m LVP growth (+9.7%) vs. 4.3% in 2022 Completion of the first €1bn disposal program Net debt/Adj.

  19. Slide 19: Building sustainable growth momentum

    INTERNAL & PARTNERS Building sustainable growth momentum Strong and selective order intake of >€31bn in 2023 Electronics Electric Vehicles Asia BEVs & FCEVs EV #1 EV #2 >€7bn >€14bn >€11bn 25% 46% 36% PROFITABILITY CONSISTENT WITH POWER25 TARGETS WITH REDUCED UPFRONT COSTS 19 | Credit Investor Prese

  20. Slide 20: Sales of €27.2bn, up 14% vs. 2022 on an organic basis

    INTERNAL & PARTNERS Sales of €27.2bn, up 14% vs. 2022 on an organic basis (+430bp vs. market) Seating(3): Interiors(3): Clean Mobility(3): +16% in 2023 +12% in 2023 +11% in 2023 In €m +22% in 2022 +17% in 2022 +11% in 2022 3,431 515(1) (1,272) 27,248 +2.1% +14.0% (5.2)% 6,512 674 25,458 24,574 +41.7

  21. Slide 21: Operating margin up 100bps in 2023, recovering from 2022 margin erosion

    INTERNAL & PARTNERS Operating margin up 100bps in 2023, recovering from 2022 margin erosion Seating(2): Interiors(2): Clean Mobility(2): +110bps in 2023 Flat in 2023 +80bps in 2023 In €m (210)bps in 2022 +30bps in 2022 (240)Bps in 2022 50 139 12 1,439 390 (75) (138) 346 1,115 1,061 126 5.3% 862 of s

  22. Slide 22: Synergies ahead of roadmap

    INTERNAL & PARTNERS Synergies ahead of roadmap 2025 Objective revised upwards from >€300m to >€350m Net cost synergies with FORVIA HELLA • €139m incremental net synergies (from €51m to €190m) in 2023 driven by: >€350m ⚬ Direct & indirect purchasing €300m ⚬ Operations >€300m Previous ⚬ Global Busines

  23. Slide 23: Continued deleveraging with Net Debt ratio at 2.1x

    INTERNAL & PARTNERS Continued deleveraging with Net Debt ratio at 2.1x Net Leverage Ratio Fast deleveraging supported by: 3,1x • Robust Net Cash Flow of €649m in FY23 2,7x 2,4x 2,1x • Net financial investment & other of €567m including 1,6x ⚬ Above €700m cash proceeds from completion of the €1bn dis

  24. Slide 24: Our Strategic Projects

    INTERNAL & PARTNERS Our Strategic Projects Op.Margin >7% 4% NCF/sales <1.5x net debt/adj. EBITDA ratio in 2025 in 2025 in 2025 VIAs Strengthen our intimacy with Japanese OEMs Europe 2028: c.40% TO Asia 2028: >35% of our global sales of our global sales Op. Margin >7% SUCCESS Op. Margin >10% Benefit

  25. Slide 25: Launch of EU-Forward project in February 2024

    INTERNAL & PARTNERS Launch of EU-Forward project in February 2024 A five-year 2024-2028 project to reinforce competitiveness in Address specific overcapacities in some Forvia’s divisions in Europe Europe • Up to 10,000 jobs impacted over the 5-year period, • Adapt to structural volume drop and accel

  26. Slide 26: Phase 1 of the asset disposal program already achieved, Phase 2 on track

    INTERNAL & PARTNERS Phase 1 of the asset disposal program (€1bn) already achieved, while Phase 2 (€1bn) is well on track Second asset disposal program (c. €1bn) ONGOING TOTAL Further simplification of the Group’s portfolio • Other assets for disposal similar to the first program: equity in joint ven

  27. Slide 27: 2024 guidance and 2025 ambition

    INTERNAL & PARTNERS 2024 guidance and 2025 ambition SALES OPERATING MARGIN NET CASH FLOW NET DEBT/ADJ. EBITDA 2024 BETWEEN BETWEEN €27.5bn AND 5.6% AND ≥2023 ≤ 1.9x €28.5bn 6.4% OF SALES LEVEL IN VALUE at December 31, 2024 Worldwide automotive production broadly stable Full-year average currency rat

  28. Slide 28: Conclusion and Q&A

    INTERNAL & PARTNERS 03 Conclusion and Q&A 28 | Credit Investor Presentation| June 2024 5acXjzUk

  29. Slide 29: Key take-aways

    INTERNAL & PARTNERS Key take-aways 7 TH GLOBAL The world’s seventh largest automotive supplier with leading positions in each of its 01 business segments THE AUTOMOTIVE SUPPLIER Mobility Autonomous Connected electrification driving vehicles 02 Attractive industry benefitting from key automotive mega

  30. Slide 30: Appendix

    INTERNAL & PARTNERS Appendix 30 | Credit Investor Presentation| June 2024 5acXjzUk

  31. Slide 31: High degree of customer proximity with international reach

    INTERNAL & PARTNERS High degree of customer proximity with international reach Forvia’ footprint enables to support customers’ programs close to their local production sites and end markets c.153,000 257 90 Leading technology Employees in 41 countries with platform Plants Worldwide Customers in 2023

  32. Slide 32: Key partner to a broad and diversified base of OEMs around the globe

    INTERNAL & PARTNERS Key partner to a broad and diversified base of OEMs around the globe Long standing relationship with OEMS with ability to serve across the value chain from mass market to premium segments Mass market OEMs Premium OEMs Chinese OEMs US EV maker 32 | Credit Investor Presentation| Ju

  33. Slide 33: Current capital structure

    INTERNAL & PARTNERS Current capital structure As of December 2023 Dec-23 Adj. for SSD & Dec-23 Pro x EBITDA Pricing Maturity Amount (€m) EUR Notes Forma Cash and cash equivalents (4,274) (4,274) (1.3)x Other current financials assets included in net debt (26) (26)0 (0.0)x Senior credit facility (€1,

  34. Slide 34: Double-digit organic sales growth and improved margin in all regions in 2023

    INTERNAL & PARTNERS Double-digit organic sales growth and improved margin in all regions in 2023 In €m EMEA Americas Asia Group EMEA: margin improved yoy but far from targeted level Regional auto. prod. YoY* ▪ Operating margin up 90bps to 2.5% of sales, penalized 2022 sales (€m) 11,050 6,822 6,701 2

  35. Slide 35: 2023 Adjusted EBITDA at 12.2% of Group Sales

    INTERNAL & PARTNERS 2023 Adjusted EBITDA at 12.2% of Group Sales Net Cash Flow of €649m, at 2.4% of Group Sales Capex to sales decreased significantly from 4.6% to In €m 2022* 2023 Change 4.2% while Capitalized R&D to sales slightly decreased Operating income 1,061 1,439 +13.6% from 3.9% to 3.8% Dep

  36. Slide 36: Q1 2024 update: sales of €6.5bn, up 3.1% on an organic basis

    INTERNAL & PARTNERS Q1 2024 update: sales of €6.5bn, up 3.1% on an organic basis Outperformance of 390bps Reported sales growth of -1.7% €206m €(38)m €(281)m Organic growth of 3.1% -0.6% with all Business Groups €6,644bn +3.1% + Consolidation of HBBL -4.2% outperforming the market Lighting JV in Chi

  37. Slide 37: Q1 2024 sales driven by strong outperformance in North America

    INTERNAL & PARTNERS Q1 2024 sales driven by strong outperformance in North America EMEA In €m EMEA Americas Asia Group 440bps outperformance in Europe ex. Russia • Limited organic decline in Europe (-0.3%) and +17.5% organic growth in the RoW Regional auto. prod. YoY* -1.6% +0.3% -0.9% -0.8% • Low t

  38. Slide 38: Extended debt maturity through active debt management

    INTERNAL & PARTNERS Extended debt maturity through active debt management €1,400m of new debt issued in 2024 BREAKDOWN OF GROSS DEBT BY MATURITY • €1,200m of a dual tranche senior bond In €m At the end of 2023 Pro forma end of May 2024 • €500m June 2029 at 4.96%* • €700m June 2031 at 5.34%* • €200m

  39. Slide 39: Glossary

    INTERNAL & PARTNERS Glossary Sales growth Operating income ▪ FORVIA’s year-on-year sales evolution Operating income is the FORVIA group’s principal performance indicator. It corresponds to net income of fully consolidated companies is made of three components: before: ▪ A “Currency effect”, calculat

  40. Slide 40: 40 | Credit Investor Presentation| June 2024

    INTERNAL & PARTNERS 40 | Credit Investor Presentation| June 2024 5acXjzUk

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