Nemak Sab De Cv · BMV:NEMAK/A
Nemak Sab De Cv — Q1 2022 Earnings Presentation
29 slides from Nemak Sab De Cv's earnings presentation, April 2022
Slide 1: 1Q22 Results
1Q22 Results APRIL 2022 ©Nemak | Internal
Slide 2: Agenda
Agenda • 1Q22 Highlights • Financial Overview Armando Tamez Alberto Sada Adrián Althoff CEO CFO IR Officer ©Nemak | Internal
Slide 3: Forward-Looking Statement
This presentation contains forward-looking information based on numerous variables and assumptions that are inherently uncertain. They FORWARD- involve judgments with respect to, among other LOOKING things, future economic, competitive and financial market conditions and future business decisions, a
Slide 4: Volume improvement amidst global semiconductor shortage
Volume improvement amidst global semiconductor shortage New product launches in our e-mobility and structural applications segment Higher aluminum prices drove a y-o-y increase in revenue ©Nemak | Internal
Slide 5: War in Ukraine presented additional challenges
War in Ukraine presented additional challenges Pressure on energy prices and inflation Temporary vehicle production reduction in Western Europe ©Nemak | Internal
Slide 6: Steps to support business continuity and resilience amidst industry volatility
We took steps to support business continuity and resilience amidst industry volatility Prudent approach to cost and expense management Ramping up production for electric vehicles Commercial negotiations to address effects of inflation ©Nemak | Internal
Slide 7: New contracts to produce battery housings for fully electric vehicles
New contracts to produce battery housings for fully electric vehicles for US$350 M annually Single-largest business award in our company’s history across product lines Total capex of approximately US$200 million to support production of these parts Opportunity to further scale our capabilities in hi
Slide 8: Pursuing new opportunities in EV/SC segment
Pursuing new opportunities in EV/SC segment for more than US$1.4 B annually ©Nemak | Internal
Slide 9: Growing order book in EV/SC segment
We aim to grow our order book in our EV/SC segment to US$2 B annually well ahead of time ©Nemak | Internal
Slide 10: EV/SC segment accounts for majority of investment needs
EV/SC segment accounts for majority of investment needs Intensive phase of capex deployment to support our transformation strategy ©Nemak | Internal
Slide 11: Focus resources on immediate investment and operating needs
We will focus our resources on immediate investment and operating needs We prioritize long-term value creation and the needs of our business ©Nemak | Internal
Slide 12: Awarded contracts across product lines
Awarded contracts across product lines for ~US$390 M annually 100% represented incremental business Includes contracts to produce ICE powertrain components for ~US$40 M annually ©Nemak | Internal
Slide 13: GM Supplier of the Year award
In 2021, we received GM’s “Supplier of the Year” award for the 20th time ©Nemak | Internal
Slide 14: Investing in transition to carbon-free energy sources
We are committed to investing in support of the transition to carbon-free energy sources We expect to bring our share of renewables in our energy mix to 70% by 2030 In line with our roadmap to achieve a 28% reduction in greenhouse gas emissions by 2030 ©Nemak | Internal
Slide 15: Financial Results
Financial Results ©Nemak | Internal
Slide 16: 1Q results keep us positioned to meet full-year guidance
Despite challenges, our 1Q results keep us well positioned to meet our full-year guidance Stronger volume Ongoing measures to control costs ©Nemak | Internal
Slide 17: Light-vehicle sales increased sequentially, below 1Q21
Light-vehicle sales increased sequentially, but remained below 1Q21 Global semiconductor shortage War in Ukraine ©Nemak | Internal
Slide 18: Sequential recovery trend in certain markets
Sequential recovery trend in certain markets Vehicle SAAR (M Units) Vehicle Production (M Units) 35.0 2.5 2.2 30.0 22.6 China 2.0 25.0 1.5 1.4 20.0 USA 1.3 13.3 15.0 1.0 9.8 10.0 W. Europe 0.5 5.0 0.2 1.6 Brazil - 0.0 Apr-21 Jul-21 Oct-21 Jan-22 Apr-21 Jul-21 Oct-21 Jan-22 Source: S&P Global Mobilit
Slide 19: Industry outlook in line with guidance assumptions
We continue to see our industry outlook in line with our guidance assumptions Light-vehicle production in key markets could potentially see further recovery in coming periods ©Nemak | Internal
Slide 20: Volume lower than last year but higher sequentially
Volume was lower than last year but higher sequentially 1Q22 vs 1Q21 -6.7% 10.7 10.0 9.0 8.2 +20.9% 7.8 1Q21 2Q21 3Q21 4Q21 1Q22 ©Nemak | Internal
Slide 21: 1Q22 Results
1Q22 Results EBITDA (US$ M) Unitary EBITDA (US$/Eq. Unit) 169 16.7 16.2 15.8 150 14.7 134 115 115 11.6 1Q21 2Q21 3Q21 4Q21 1Q22 1Q21 2Q21 3Q21 4Q21 1Q22 Eq. Vol 10.7 9.0 7.8 8.2 10.0 M units ©Nemak | Internal
Slide 22: Higher costs impacted our results
Higher costs impacted our results Increased energy prices Inflation-related impacts across categories Strict control of costs and expenses ©Nemak | Internal
Slide 23: Operating Income US$36 M and Net Income US$6 M
Operating Income in the quarter was US$36 M and Net Income was US$6 M This reflects the same factors that affected EBITDA ©Nemak | Internal
Slide 24: Capex investment during 1Q22 was US$89 M
On the CAPEX side, investment during 1Q22 was US$89 M 41% higher y-o-y Increased expenditures in our e-mobility and structural applications segment ©Nemak | Internal
Slide 25: Capital allocation focused on strategic CAPEX
We plan to focus capital allocation on strategic CAPEX Investment in EV-related opportunities to drive shareholder value creation ©Nemak | Internal
Slide 26: Net Debt was US$1.3 B
Net Debt was US$1.3 B Leverage (Net debt-to-LTM EBITDA): 2.5x Interest Coverage: 5.0x* *6.7x excluding bonds refinancing effect ©Nemak | Internal
Slide 27: Summary of regional results 1Q22
Summary of regional results 1Q22 Revenues 1Q22 1Q21 % Var. North America 602 520 15.7 Europe 390 397 (1.8) Rest of World 139 121 15.2 Total 1,131 1,039 8.9 EBITDA 1Q22 1Q21 % Var. North America 68 82 (17.2) Europe 41 75 (45.9) Rest of World 7 12 (42.3) Total 115 169 (32.0) ©Nemak | Internal
Slide 28: Q&A
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Slide 29: For more information contact us
For more information contact us at: investors.nemak.com investor@nemak.com ©Nemak | Internal