Slide 1: Welcome to Schindler - Full year results presentation 2017
Welcome to Schindler Full year results presentation 2017 February 16, 2018
Slide 2: Agenda
Agenda Market development Strategy and execution Results 2017 Outlook 2018 Full year results presentation 2017presentation 2017 February Full year results l Page16, 2 2018 Your16, l February First Choicel 2018 Schindler
Slide 3: Megatrends remain intact: urbanization and demographic change
Megatrends remain intact Urbanization & demographic change will raise E&E demand Urban population Global middle class Persons aged 60+ Single-person is constantly is set to increase by will soon exceed 1.4 households increasing. By 2030, more than 60% billion globally, are on the rise with almost 9%
Slide 4: Megatrends remain intact: ongoing demand for latest technology
Megatrends remain intact Ongoing demand for latest technology Ageing installed base Digitization and IoT Energy efficiency 20 years is the average age of an Mass connectivity is coming Energy efficient solutions are elevator in developed countries, everywhere. The number of things increasingly in de
Slide 5: Global new installations market with slight growth
Global new installations market with slight growth China has stabilized +3% NI market size (units) by region +3% Stable +3% 2016 | 2017 2016 | 2017 2016 | 2017 2016 | 2017 Americas Europe Asia-Pacific Global NI market size (value) by region 19% 18% 63% 100% North America Growth driven by China with
Slide 6: Global existing installations market grew strongly
Global existing installations market grew strongly China adds more than 500k units per year +6% EI market size (installed base in units) by region +2% +9% +2% 2016 | 2017 2016 | 2017 2016 | 2017 2016 | 2017 Americas Europe Asia-Pacific Global EI market size (installed base in value) by region 26% 32
Slide 7: Agenda
Agenda Market development Strategy and execution Results 2017 Outlook 2018 Full year results presentation 2017presentation 2017 February Full year results l Page16, 7 2018 Your16, l February First Choicel 2018 Schindler
Slide 8: Schindler's response to the megatrends
Schindler’s response to the megatrends Three objectives driving our engagement in all areas Grow faster than the market Improve profitability Foster a winning team Customers & Markets Innovation & Processes People & Organization Customer excellence Digitization (IoEE) Talent management Strategic mar
Slide 9: Top priorities to achieve our three objectives
Top priorities to achieve our three objectives Creating an unrivaled user experience Operational excellence Strategic priorities People New installations User experience Quality Customer Quality & Existing excellence innovation Modularity installations Schindler – Your First Choice Trusted. Professi
Slide 10: Modularity: Making things simple
Modularity Making things simple! Seamless product offering Reduce complexity Competitiveness Product offering tailored to market Less component variants, less Cost savings for increased needs increasing customer value effort for design changes, and competitiveness and enhanced through a seamless pro
Slide 11: Modularity – roadmap to reduce systems and modules
Modularity – roadmap to reduce systems and modules On track to cut product complexity by half Systems Elevator systems Machines Machine types Controller components Controller hardware, inverter types 50% reduction of active and maintained subcomponents Hoistway materials Single components (no «syste
Slide 12: Digital business transformation – roadmap
Digital business transformation – roadmap Digitization (IoEE) Focus 1 – IT rationalization Focus 2 – Operational excellence Focus 3 – Schindler Ahead Global IT system landscape Global business process Leading-edge digital business platform Infrastructure standardization Superior customer a
Slide 13: Schindler Ahead Video
Schindler Ahead Video Full year results presentation 2017presentation 2017 February Full year results l Page16, 13 2018 Your16, l February First Choicel 2018 Schindler
Slide 14: Agenda
Agenda Market development Strategy and execution Results 2017 Outlook 2018 Full year results presentation 2017presentation 2017 February Full year results l Page16, 14 2018 Your16, l February First Choicel 2018 Schindler
Slide 15: Global markets in 2017: key developments
Global markets in 2017 Key developments Global demand for new installations showing slight growth ‒ Demand in China stabilized; pricing under continuous pressure ‒ Indian market still impacted by 2016 monetary reforms as well as by regulatory and fiscal changes; signs of recovery seen in fourth quar
Slide 16: Schindler Highlights 2017
Schindler Highlights 2017 Sustained growth and increased profitability Sustained growth ‒ Overall growth above market ‒ Growth in both new installations and particularly service business ‒ High acceptance of new products ‒ Strong conversion of new installations into service contracts ‒ Execution of
Slide 17: Asia-Pacific: China
Asia-Pacific: China New installations market stabilized Market development ‒ Stabilization driven primarily by residential real estate market ‒ Challenging market conditions in commercial real estate sector ‒ Strong service market growth ‒ Pricing under continuous pressure Schindler performance ‒ Ab
Slide 18: Asia-Pacific: other markets
Asia-Pacific: other markets Overall growth Mixed market development ‒ India: the 2016 currency reform and regulatory changes still affected the progression of real estate projects; signs of recovery seen in fourth quarter ‒ Southeast Asia: residential real estate and infrastructure sectors drove new
Slide 19: Americas: Robust US market
Americas Robust US market Diverging market developments ‒ North America: positive development in US construction sector continued; accelerated demand for residential properties and improved commercial real estate sector ‒ Latin America: very challenging environment in Brazil, signs of turnaround Sch
Slide 20: Europe: Strong markets
Europe Strong markets Overall positive development ‒ Northern Europe: positive developments, particularly in Germany; good growth in most Eastern European countries; UK with uncertainties surrounding Brexit ‒ Southern Europe: robust growth, especially in residential markets in France and Spain Schin
Slide 21: Q4 2017 – key figures
Q4 2017 – key figures October to December In CHF million 2017 2016 Δ% Δ% in LC Orders received 2 906 2 699 7.7 5.9 Revenue 2 820 2 629 7.3 6.0 Operating profit (EBIT) reported 327 352 –7.1 –9.1 in % 11.6 13.4 Net profit reported 236 237 –0.4 Before exceptional items Operating profit (EBIT) 342 1) 31
Slide 22: Full year 2017 – key figures
Full year 2017 – key figures January to December In CHF million 2017 2016 Δ% Δ% in LC Orders received 10 989 10 374 5.9 5.5 Revenue 10 179 9 683 5.1 4.6 Operating profit (EBIT) reported 1 187 1 133 4.8 3.3 in % 11.7 11.7 Net profit reported 884 823 7.4 Before exceptional items Operating profit (EBIT
Slide 23: Order backlog and revenue by region
Order backlog and revenue by region Robust order backlog provides solid base for future growth Revenue growth by region (in LC) Order backlog 2017: CHF 10 707 million (+6.3% in LC) 8% 2016: CHF 10 004 million 7% 2017 2016 Asia-Pacific 42% 43% 6% Americas 29% 31% Europe 29% 26% 5% 4% 3% Revenue 2017:
Slide 24: Full year 2017 – key figures
Full year 2017 – key figures January to December In CHF million 2017 2016 Δ% Δ% in LC Cash flow from operating activities 810 929 –12.8 Investments in property, plant, and equipment 227 189 20.1 31.12.2017 31.12.2016 Order backlog 10 707 10 004 7.0 6.3 Number of employees 61 019 58 271 4.7 Full year
Slide 25: Dividend proposal of CHF 4.00
Dividend proposal of CHF 4.00 Target pay-out ratio increased to 35% – 65%1) In CHF 6.00 Special dividend 5.00 Ordinary dividend 4.00 3.00 2.00 1.00 0.00 2013 2014 2015 2016 2017 2) Pay-out ratio in % 59.6 41.9 44.0 70.5 52.3 1) previously: 35% – 45% 2) Pay-out ratio in % of net profit attributable t
Slide 26: Agenda
Agenda Market development Strategy and execution Results 2017 Outlook 2018 Full year results presentation 2017presentation 2017 February Full year results l Page16, 26 2018 Your16, l February First Choicel 2018 Schindler
Slide 27: Outlook 2018
Outlook 2018 Status as of February 16, 2018 Business environment Schindler guidance ̶ Long-term growth drivers remain intact ̶ Focus on profitable growth unchanged ̶ Global elevator and escalator market is ̶ Revenue expected to increase by estimated to continue growing along 3% to 5% in local curren
Slide 28: Financial calendar
Financial calendar 2018 2019 Full year results media conference February 16 February Closing date of shareholders' register March 14 Ordinary General Meeting Schindler Holding Ltd. March 20 March 26 First trading date ex-dividend March 221) Date of Schindler Holding Ltd. dividend payment March 261)
Slide 29: Additional charts
Additional charts Full year results presentation 2017presentation 2017 February Full year results l Page16, 29 2018 Your16, l February First Choicel 2018 Schindler
Slide 30: Balance sheet
Balance sheet In CHF million 31.12.2017 31.12.2016 in % Cash and cash equivalents 1 709 19.8 1 988 23.9 Other current assets 3 771 43.7 3 432 41.4 Total current assets 5 480 63.5 5 420 65.3 Non-current assets 3 146 36.5 2 883 34.7 Total assets 8 626 100.0 8 303 100.0 Current liabilities 4 379 50.8 4
Slide 31: Quarterly overview 2017/2016
Quarterly overview 2017/2016 In CHF million 2017 2016 Q4 Q3 Q2 Q1 Q4 Q3 Q2 Q1 Orders received 2 906 2 737 2 739 2 607 2 699 2 592 2 616 2 467 Revenue 2 820 2 590 2 509 2 260 2 629 2 409 2 469 2 176 Operating profit (EBIT) 327 302 298 260 352 277 269 235 in % 11.6 11.7 11.9 11.5 13.4 11.5 10.9 10.8 F
Slide 32: Financing and investing activities
Financing and investing activities In CHF million 2017 2016 Interest income net 10 11 Net income from securities 18 4 Net interest on employee benefits, increase in the present value of provisions –20 –21 Net losses on foreign exchange –6 –32 Revaluation/exchange of 0.375% exchangeable bond 2013 – 2
Slide 33: Q4 2017 – key figures
Q4 2017 – key figures October to December In CHF million 2017 2016 Δ% Δ% in LC Cash flow from operating activities 266 270 –1.5 Investments in property, plant, and equipment 86 76 13.2 31.12.2017 30.9.2017 Order backlog 10 707 10 766 –0.5 –1.7 Number of employees 61 019 60 232 1.3 Full year results
Slide 34: IFRS 15 – Revenue recognition
IFRS 15 – Revenue recognition Changes and impacts Until end of 2017 Until end of 2017 Gradual revenue recognition over duration of new installations and modernization projects (percentage-of-completion, starting with first costs allocated to project) Accumulated costs and estimated margins repor
Slide 35: IFRS 15 – Revenue recognition: restatement
IFRS 15 – Revenue recognition Restatement as of January 1, 2018 Approach ‒ Transition from old accounting standard to IFRS 15 recognized in equity as of January 1, 2018 ‒ No restatement of comparative figures 2017 reported in 2018 (modified retrospective approach) Financial impacts ‒ Negative equity